Mar 31, 2023
On behalf of Board of Directors, I present the 60th Annual Report on your company''s performance for the financial year ended 31st March 2023 along with Audited Statements of Accounts and Statutory Auditor''s Report.
OPERATIONAL RESULTS
Your company has recorded a turnover of Rs.271.77 crores during 2022-23 as against the turnover of Rs.7840.78 crore registered during last fiscal. This business turnover which is mainly consists of domestic trade of Rs. 271.77 crores. The Company has reported a net profit of Rs.1076.07 crores during 2022-23 as compared to net loss of Rs. 237.77 crores reported during the previous financial year. The reduction of revenue is mainly due to discontinuance of business operations of the company as per the instructions of Administrative Ministry.
Company''s performance during 2022-23 is given below: -
(Rs. in crores) |
(Rs. in crores) |
|
2022-23 |
2021-22 |
|
Sales of products |
267.09 |
7,836.28 |
Sales of services |
4.68 |
4.50 |
Other Trade Earnings |
0.78 |
552.51 |
Total Revenue from Operations |
272.55 |
8,393.29 |
Cost of Sales |
258.30 |
7,799.79 |
Gross Profit from Operations |
14.25 |
593.50 |
Add: Dividend and other Income |
15.75 |
50.14 |
Less: Establishment & Administrative Overheads, etc. |
135.15 |
160.56 |
Less: Debts/Claims Written off |
0.03 |
0.02 |
Less: Provisions for Doubtful Debts/Claims/Advances/ Investments |
1.72 |
1.05 |
Profit Before Interest, Depreciation and Amortization Expenses and Taxes |
(106.90) |
482.01 |
Less: Interest Paid(Net) (Interest Paid minus Interest earned) |
26.76 |
201.64 |
Profit Before Depreciation and Amortization Expenses and Taxes |
(133.66) |
280.37 |
Less: Depreciation and Amortization Expenses |
4.44 |
4.57 |
Less: Exceptional Items |
(1417.26) |
155.20 |
Profit Before Taxes |
1279.16 |
120.60 |
Less: Provision for Current Taxes |
143.11 |
17.34 |
Less: Provision for Deferred Taxes |
59.98 |
341.03 |
Profit After Taxes |
1076.07 |
(237.77) |
Add: Balance brought forward from the previous year |
(546.63) |
(308.86) |
Balance |
||
Items of other comprehensive income recognized directly in retain earnings |
||
Items recognized directly in retain earnings |
- |
- |
Dividend & Dividend Tax |
- |
- |
Appropriations: |
||
General Reserve |
- |
- |
Leaving a Balance to be carried forward |
529.44 |
(546.63) |
The performance of different business groups of your Company is highlighted in the Management Discussion and Analysis Report, which is annexed and forms part of this Report. Auditor / CAG report along with management replies and Notes to accounts contain important information affecting company financials such as Loan Re-structuring, Anglo Coal dispute, disinvestment of NINL, etc.
EQUITY SHARE CAPITAL & DIVIDEND
There is no change in equity capital of the company during the year. The paid up equity of the company stood at Rs.150 crores comprising of 150 crores number of equity shares of the face value of Re.1/- each, as on 31.3.2023. The Board of Directors has not recommended any dividend for the year 2022-23 in view of current liquidity crunch, exhaustion of bank limits and difficulties in meeting its day-to-day working capital requirement and net loss incurred by the Company during 2020-21 & 2021-22.
A sum of Rs.50.34 crores was available in the reserves and surplus of your Company as on 1st April, 2022. An amount of Rs. 1126.41 crores is available in "Reserves and Surplus" of your Company as on 31st March, 2023.
FOREIGN EXCHANGE EARNINGS AND OUTGO
The Foreign Exchange earnings and outgo of your Company during 2022-23 has been as under:-
EARNINGS (Rs./Cr) |
OUTGO (Rs./Cr) |
|||||
Exports |
3.76 |
Imports |
61.15 |
|||
Others |
0.21 |
Others |
- |
|||
Total |
3.97 |
Total |
61.15 |
|||
Awards MMTC has been awarded by CAPEXIL Awards for Excellence in Exports for the year 2017-18 to 2021-22(five years) in the following categories: |
||||||
Year |
Panel/Sector |
Award |
||||
2017-18 |
Bulk Minerals and Ores/Canalised Agency |
Highest |
||||
2018-19 |
Bulk Minerals and Ores/Canalised Agency |
Highest |
||||
2019-20 |
Bulk Minerals and Ores/Canalised Agency |
Highest |
||||
2020-21 |
Bulk Minerals and Ores/Canalised Agency |
Highest |
||||
2021-22 |
Bulk Minerals and Ores/Canalised Agency |
Certificate of Merit |
During the financial year 2022-23 MTPL achieved sales turnover of USD 405.15 million as against USD 456.58 million recorded during last fiscal. The Net Profit of MTPL during the financial year 2022-23 amounted to USD 0.51 million as against USD 0.69 million earned during 2021-22. The net worth of MTPL stood at USD 5.68 million as on 31st March 2023. Overall dividend declared by MTPL since inception is USD 27.945 million which includes a dividend of USD 1 million received from MTPL during FY 2022-23.
Recently there are reports of lapses/cases of default by MTPL Singapore to the tune of around Singapore Dollar 23 million in July, 2023. The auditors/CAG/MoC/BSE/NSE have been informed.
Pursuant to the provisions of Section 129 of the Companies Act, 2013, the audited financial statements of MTPL together with Directorsâ Report & Auditor''s Report are attached herewith.
MMTC''s Joint Venture - Neelachal Ispat Nigam Ltd. (NINL)
The divestment process of NINL, the joint venture company got completed on 04.07.2022 under the aegis of DIPAM. In this process, MMTC recovered an amount of Rs.1872.35 Crore (net of withholding tax) through distribution of sale consideration to promoters in the form of equity on 4th July 2022. MMTCâs share in total divestment proceeds is Rs.5335 crores. Tata Steel Long Products Limited now owns NINL.
Other Projects/ Joint Ventures
A brief on the current status of such JVs set up in past years is given hereunder:
(I) Your company presently holds 6% equity capital in Indian Commodity Exchange Limited (ICEX) as on 31.3.2023. As per regulation, 17 of SECC Regulations, 2018 in terms of SEBI Circular Reference no. CIR/CDMRD/DEA/03/2015 dated 26 November 2015 holding has to be reduced to 5% or less. MMTC in 2018 and 2019 appointed consultants for valuation and disinvestment of equity in ICEX. However, MMTC did not receive any bids against the RFPs for sale of stake in ICEX. As of March 31,2023, the shares of ICEX are not available for purchase on any stock exchange. MMTC tried to sell its equity in ICEX in FY 2017-18 and again from FY 2019-20 to 2021-22, but MMTC was unable to find any buyers. SEBI passed order dated 10.05.2022 for withdrawal of recognition to ICEX vide official gazette of India on 18.05.2022. However, Securities Appellate Tribunal (SAT), by its order dated 13 June 2022 has Quashed SEBI order derecognizing ICEX and has given ICEX one-year time from 13.6.2022 to complete all compliances to SEBIâs satisfaction during this period all trading activities would remain suspended. ICEX Board in February 2023, approved the voluntary surrender of the License/Recognition of the Exchange to Regulator (SEBI) and to discontinue the Commodity derivatives business. Further, ICEX Board decided to consider new line of business(es) at appropriate time.
(ii) Your company had participated in the equity of Currency Futures Exchange under the name and style of "United Stock Exchange of India Ltd which had been merged with âBSE Limited" (BSE) wherein your Company presently holds 116883 (post bonus issue) equity shares of Rs. 2/- each in BSE. During the year BSE earned a PAT of Rs.166.91 crores as against Rs195.12 crores earned during 2022-23 and paid dividend of Rs.12/- on equity share of Rs. 2/- each for the Financial Year 2022-23.
(iii) MMTC-PAMP India Pvt. Ltd., a joint venture Company between MMTC Limited and PAMP SA, Switzerland, operates a precious metals processing facility. MPIPL is Indiaâs first and only LBMA Good Delivery Refinery accredited for Gold and Silver. The Joint Venture achieved a turnover of Rs.31,503.75 crore and a profit (after tax) of Rs.118.61 crore during the period FY 2022-23. The JV company has declared a dividend of Re.2/- per share for 2022-23.
(iv) The JV company - SICAL Logistics Limited (SLL), MMTC Ltd and L&T Infrastructure Development Projects Limited (L&T IDPL) entered into a Share Purchase Agreement on 25.02.2009 and held 63%, 26% and 11% equity respectively to form a Special Purpose Vehicle Company i.e. SICAL Iron Ore Terminal Limited (SIOTL), for development of an Iron Ore berth at Kamarajar Port (earlier known as Ennore Port) near Chennai to handle Iron Ore capacity of 12 MMTPA.
M/s SICAL Iron Ore Terminals Limited (SIOTL) could not commence commercial operations due to non availability of iron ore from Bellary-Hospet Sector in Karnataka State and banning of mining / movement of iron ore for exports by state govt. In view of uncertain future of iron ore exports and to utilize the infrastructure created, Kamarajar Port Trust (erstwhile Ennore Port Trust) decided to award the facility through bidding process for modification of the facility to handle common user coal. As coal does not have synergy with MMTCâs existing line of business, In Septâ2016, MMTC Board decided to exit from the JV. MMTC invited bids through online tender for sale of its entire 26% equity in the SIOTL, however no response was received. Meanwhile, as per âRight of First Refusal" in Shareholders Agreement of SIOTL, SICAL Logistics Ltd; (lead promoter of SIOTL) offered to purchase MMTCâs equity at reserve price fixed by MMTC which MMTC Board decided to accept. Share Purchase Agreement was signed with Sical Logistics Ltd on 31.05.2018 for sale of MMTCâs equity in SIOTL and in terms of the agreement M/s Sical Logistics Ltd had deposited Rs.0.50 Cr (PY Rs.0.50 Cr) with MMTC towards performance of agreement. Time to time, the validity of the SPA was extended. Last extension was valid till 31.03.2020. On account of financial crisis, M/s Sical Logistics could not pay the sale value against SPA and therefore provision for Rs.33.80 crore was created by MMTC on 31.03.2020 towards diminution in value of investment.
In the March 2021, NCLT pronounced an order as against M/s Sical Logistics Limited initiating corporate insolvency resolution process pursuant to the application preferred by MOL Toyofuji Automotive Logistics [India] Private Limited and an Insolvency Resolution Professional (IRP) was been appointed. MMTC lodged its claim for Rs.34.26 crores with CIRP (Corporate Insolvency Resolution Professional) towards unpaid share sale consideration based on the SPA.
Meanwhile, on 21.12.2020, KPL issued a Notice of Intent to Terminate to SIOTL alleging a financial default under the License Agreement dated 11.07.2016. On 22.03.2021, KPL issued a 90 daysâ Termination Notice to SIOTL with effect from 22.03.2021. On the same date, KPL has also issued a Transfer Information Notice calling for information from JV Co within 30 days, i.e. by 20.04.2021. As suggested by advocates, MMTC filed a writ petition on 24/06.2021 in Madras High Court for settlement of dispute through Administrative Mechanism of Resolution of Dispute (AMRD).
However, Honâble MHC while referring to (Administrative Mechanism for Resolution of Commercial Disputes) AMRCD has opined that âsuch being position of law, this court of the view that remedy available to petitioner is elsewhere and not this court". The Honâble Court vide its order dated 30.11.2021 held that the âwrit petition filed by MMTC itself is not maintainable". MMTC has challenged the order vide WA 498 of 2022 & was listed on 28.3.2022/7.4.2022 and is still pending for admission.
The Resolution Professional (RP) in CIRP of SICAL also challenged the impugned termination notice dated 22.03.2021 passed by KPL before NCLT. MMTC moved an application to be impleaded in the said application of the RP. The application of RP was dismissed by NCLT for want of jurisdiction vide Order dated 11.03.2022. As a result, MMTC application was also dismissed.
M/s SIOTLâs have initiated corporate insolvency resolution process against SIOTL in NCLT under Insolvency and Bankruptcy Code 2016. Vide order dated 01.03.2022, NCLT Chennai has admitted their applications and have appointed an IRP.
MMTC has also taken legal opinion of ASG whether MMTC can proceed under AMRCD against KPL and options available to recover its investment.
NCLT vide it order dated 08.12.2022 has approved the resolution plan of SLL and the successful resolution applicant has been appointed.
Subsequently MMTC had also written to RP of Sical Iron Ore Terminal Limited (SIOTL) submitting MMTCâs claim for recovery of its investment of Rs 34.26 crore and enforcing of the Share Purchase Agreement (SPA) entered between MMTC and Sical Logistics Limited (SLL), alongwith RP of SLL for enforcing the SPA against SLL or against the revived entity after resolution. MMTC also wrote a letter to M/s Pristine Malwa Logistics Park private limited (As the successor of SLL after the resolution) requesting to enforce the SPA against SLL or against the revived entity.
Further RP of SIOTL vide letter dated 02.03.2023 had rejected MMTCâs claim and subsequently NCLT vide its Order dated 23rd Juneâ23 has decided to initiate the liquidation process in respect of Sical Iron Ore Terminal Limited (SIOTL) and has accordingly appointed the Liquidator for the same.
In the meantime MMTC is exploring possibilities to make an appeal in NCLAT against NCLTâs order dated 08.12.22 to recover its investment in SIOTL.
(v) To promote the concept of Free Trade Warehousing Zones in India as declared in the EXIM Policy, MMTC and IL&FS established SPV IN 2004-05 in the name of Free Trade Warehousing Pvt Ltd. The equity is held on 50:50 basis between MMTC and IL&FS. Two 100% owned subsidiaries of FTWPL were established to administer the land banks at Kandla and Haldia. In view of financial situation of the promoters and the need for infusion of the substantial funds for development of the Project, it was decided by the promoters to exit from the project. Accordingly, the land at Kandla has been surrendered to the Project Authority. With regard to Haldia Land, local farmers had filed petition against Haldia Development Authority challenging the land acquisition in 2015 and stay was granted by Honâble High Court of Calcutta. Due to prolonged litigation and stay not being lifted, promoters decided to surrender the land to Haldia Development Authority(HDA). Accordingly in March, 2020, land was surrendered to HAD and refund of amount of Rs.36 crores is being followed up.
(vi) A 15 MW capacity Wind Mill project with 25 Wind Energy Generators was commissioned by MMTC in March, 2007 at Gajendragad in Karnataka. The power generated by the project is sold to HESCOm. The project is running successfully and has contributed to the development of area by meeting some of the power needs of Karnataka State. The turnover of the Wind Mill project during 2022-23 was Rs. 5.13 crores by sale of wind power generated by the wind farm at Gajendragad in Karnataka.
INDUSTRIAL RELATIONS & HUMAN RESOURCE MANAGEMENT
Cordial and harmonious industrial relations were maintained in your company during the year. No man days were lost due to any industrial unrest during the year. Further, meetings with representatives of Federation of Officers Associations/ Staff Unions/ SC&ST Associations, were held to share information / ideas with a view to achieve Companyâs goals and objectives.
The aggregate manpower of your company as on 31st March, 2023 stood at 522, comprising of 3 Board level Executives, 1 CVO, 236 officers and 282 staff/ worker. The manpower also includes 1 officer and 40 staff/ worker of erstwhile Mica Trading Company Ltd., which had been merged with your company pursuant to the orders of BIFR.
The composite representation of the total manpower is - women employees representing 20.50% (107 employees) of the total manpower; SC, ST, OBC & Persons with Benchmark Disabilities (PwBD) to the extent of 21.65% (113 employees), 12.07% (63 employees), 12.07% (63 employees) and 2.30% (12 employees) respectively.
No recruitment was made during the year.
IMPLEMENTATION OF RESERVATION POLICY
Your company has been complying with the Presidential Directives and other instructions/guidelines issued from time to time by the Government of India regarding the reservation in services for Scheduled Castes (SCs), Scheduled Tribes (STs), Other Backward Classes (OBCs), Economically Weaker Sections (EWS), Persons with Benchmark Disabilities (PWBDs) and Ex-servicemen. During the year, MMTC has successfully responded to the study visit of Honâble Parliamentary Committee on the Welfare of SCs & STs at Panaji (Goa) and also review meeting by Honâble Member of National Commission for Scheduled Castes (NCSC) at Bengaluru. A statement showing representation of employees belonging to SC/ST/OBC is as below:
Representation of SCs/STs/OBCs/Divyang as on 31.03.2023 |
||||||||||||||
Group |
Total No. |
SCs of Employees |
%age SCs |
STs |
%age Sts |
OBCs |
%age OBCs |
Divyang |
%age Divyang |
|||||
A |
240 |
51 |
21.25 |
19 |
7.92 |
30 |
12.50 |
10 |
4.17 |
|||||
B |
162 |
34 |
20.99 |
32 |
19.75 |
3 |
1.85 |
2 |
1.23 |
|||||
C |
48 |
6 |
12.50 |
3 |
6.25 |
12 |
25.00 |
0 |
- |
|||||
D |
72 |
22 |
30.55 |
9 |
12.50 |
18 |
25.00 |
0 |
- |
|||||
Total |
522 |
113 |
21.65 |
63 |
12.07 |
63 |
12.07 |
12 |
2.30 |
|||||
Recruitment of SCs/STs/OBCs/Divyang during the year 2022-23 |
||||||||||||||
Group |
Total Recruitment |
SCs |
%age SCs |
STs |
%age STs |
OBCs |
%age OBCs |
Divyang |
%age Divyang |
|||||
A |
No recruitment made. |
|||||||||||||
B |
No recruitment made. |
|||||||||||||
C |
No recruitment made. |
|||||||||||||
D |
No recruitment made. |
|||||||||||||
Total |
- |
- |
- |
- |
- |
- |
- |
- |
- |
|||||
Promotion of SCs/STs during the year 2022-23 |
||||||||||||||
Group |
Total Promotions |
SCs |
%age SCs |
STs |
%age Sts |
|||||||||
A |
42 |
8 |
19.05 |
7 |
16.67 |
|||||||||
B |
1 |
1 |
100 |
- |
- |
|||||||||
C |
- |
- |
- |
- |
- |
|||||||||
D |
- |
- |
- |
- |
- |
|||||||||
Total |
43 |
9 |
20.93 |
7 |
16.28 |
For further enhancing / upgrading the skills of employees in the constantly changing business scenario, 189 employees were imparted training during the year in different spheres of companyâs activities. The training interventions held covered both functional & behavioural trainings. The employees deputed for training programmes included 30 employees belonging to SC, 18 to ST and 112 women employees.
IMPLEMENTATION OF OFFICIAL LANGUAGE
Your company is committed to complying with the Official Language Policy of the Government of India. During the year 2022-23 the company made continuous efforts with the aim of promoting the use of Hindi and achieving the targets set in the annual program issued by the Department of Official Language (Ministry of Home Affairs, Government of India). To meet the targets given in the Official Language Annual Programme, discussions were held in the regular meetings of the Official Language Implementation Committee held at Corporate Office and Regional Offices and the decisions taken in the meetings were implemented effectively. To promote the use of official language by the employees of the company, Hindi workshops, Hindi day/week/fortnight etc. were organized in the Corporate Office and all regional offices during the year under review. At the same time, the employees/officers were personally apprised of the tools related to the official language so that they can do their work in Hindi in a better way. Consequent upon this, there was a considerable increase in the use of Hindi in day-to-day official work.
During the year, along with other items of official language implementation, Hindi website of MMTC was regularly updated in line with English. During the year, two of its Regional Offices were inspected by the Corporate Office to review the progress of implementation of official language and suggestions were given for improvement in the use of Hindi in the office accordingly. As a result of which there has been a considerable improvement in the implementation of official language. No inspection was done by the Parliamentary Committee on Official Language and the Department of Official Language during the year.
CORPORATE SOCIAL RESPONSIBILITY & SUSTAINABLE DEVELOPMENT
Your companyâs CSR Policy is in line with Section 135 of the Companies Act â2013 and the CSR Rules as notified by the Ministry of Corporate Affairs and the CSR projects have been undertaken in terms of Section 135 of the Companies Act. The CSR Policy is hosted on the Companyâs website in bilingual form.
Your company incurred losses during FY 2019-20, FY 2020-21 and FY 2021-22. Accordingly, the CSR budget calculated in accordance with the Section 198 of the Companies Act, 2013 i.e. 2% of average net profit of preceding 3
years was negative. Therefore, there was no annual CSR budget approved by Board of Directors for the year 202223. As such, no fresh CSR project was undertaken during FY 2022-23. However, your company only executed ongoing CSR projects of FY 2019-20 which were carried forward to FY 2022-23.
In terms of Section-21(b) of the Companies (Amendment) Act 2019, a Special CSR Bank Account was opened for the unspent CSR funds during FY 2020-21. As on 01.04.2022, an unspent amount of Rs. 5.27 lakhs was available in the account. The utilization of funds from this account during FY 2022-23 is as below:
Opening Balance (as on 01.04.2022) |
Rs. 5.27 lakhs |
Expenditure during FY 2022-23: |
|
Payment of final installment towards Construction of New Waiting Hall for |
|
Maternity & Child Health (MCH) Ward in District Hospital, Baran (Rajasthan) |
|
(CSR Project of FY 2019-20). |
Rs. 5.27 lakhs |
Closing Balance (as on 31.03.2023) |
Nil |
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTIVE, PROHIBITION & REDRESSAL) ACT, 2013
Your company has put in place a policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up at Corporate Office & Regional Offices to redress complaints received regarding sexual harassment at workplace. All employees (permanent, contractual, temporary, trainees) are covered under this policy.
No complaint was received by the company under the above Act during the year.
INFORMATION UNDER RIGHT TO INFORMATION (RTI) ACT
Your company as a Public Authority has responded to various compliances under RTI Act â2005. Details of designated First Appellate Authority (FAA), Chief Public Information Officer (CPIO)/ Nodal CPIO, Public Information Officers (PIOs) etc. have been displayed on public domain. During the year, a total of 57 RTI applications were received directly / under Sec.6(3) of the RTI Act and all the RTIs have been disposed off. Further, a total of 13 First Appeals were received by FAA, which were also disposed off. Your company has also undertaken âSelf-Assessment Auditâ of the Voluntary Disclosures to be made on public domain (www.mmtclimited.com) in terms of provisions laid down in Section-4 of the RTI Act 2005 and same is submitted for third party audit and final evaluation by CIC.
During the year 2022-23, there was no activity in MICA group of your company. Therefore, pursuant to rule 8(3) of the Companies (Accounts) Rules, 2014, the company does not have anything to report under this head.
In the light of Department of Commerce, Ministry of Commerce & Industryâs directions for winding down MMTC and pending final decision on closure of MMTC, Vigilance Division of MMTC is laying its emphasis on Preventive Vigilance Measures and systemic improvement. During the year, 44 inspections were conducted by Vigilance Officers (VOs) and 21 by Non-Vigilance Officers (NVOs) of Regional Offices and the inspection reports submitted were processed at Vigilance Division at Corporate Office and appropriate actions were taken, wherever required. In addition 6 CTE type inspections were also carried out of the tenders floated by Regional Offices. 10 Audit Reports of Internal Auditors have been examined and shortcoming observed were communicated for corrective action. Apart from inspections, division has also scrutinized 114 Annual Property Returns of the employees.
During the year Vigilance Division processed 17 complaints (CVC-3, Others-14), out of which 16 complaints have been disposed of and action on remaining 1 complaint was in progress as on 31.03.2023. Further during the year Vigilance Division dealt with two case of Departmental Proceeding involving six officials. In one case involving three officials proceeding have been finalized by the Disciplinary Authority by issuing penalty orders and in another case involving three officials, oral departmental proceedings have been completed and case is with Disciplinary Authority for final orders.
Compliance with respect to ODI, Agreed List(s), MIS updation of DoPT Solve, QPR, CTE-type QPR, Structured Meetings have been responded to in line with extant guidelines and reports submitted to CVC.
As per instructions of CVC, MMTC has conducted three months campaign (16th August, 2022 to 15th November, 2022) on Preventive Vigilance measures cum housekeeping activities as a precursor to VAW 2022, started from 31st October, 2022 to 6th November, 2022 on the theme âCorruption Free India for a Developed Nationâ. During this period preventive vigilance cum internal housekeeping activities viz. property management, management of assets, recording management, updation of guidelines/circulars/manuals, and disposal of complaints were taken up. In addition, lectures from spiritual personalities were also organized on the theme corruption in life and affects thereon and presentation on rules/guidelines was also conducted by Director/CVC. On successful completion of the campaign, compliance report was furnished to CVC.
In accordance with the provisions of Section 177 of Companies Act 2013, the Board of your company introduced a Scheme on âVigil Mechanismâ in 2014. The vigil mechanism is established for Directors and employees to report their genuine concerns. The concerns, if any, from any employee/Director shall be addressed to the Chairman of the Audit Committee. During the year under review, no such complaint has been received. This mechanism is apart from the Whistle Blower Policy, already in force.
Integrity Pact is promoted as part of series of steps taken by Central Vigilance Commission for ensuring transparency, equity and competitiveness in public procurement. Your Company has also implemented the same to promote transparency/equity amongst the bidders and to plug any possibility of corrupt practices in trade conducted by the Company. Shri Bal Raj, ITS (Retd.), has been appointed to function as Independent External Monitor(IEM).
Corporate Governance has emerged as an important tool to the business community to become efficient, competitive and successful enterprise. Your Company reposes its firm faith in continuous development, adoption and dedication towards the best corporate governance practices. Towards this end, the norms prescribed under the Companies Act, 2013, SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 and Guidelines as applicable for CPSEs issued by the Department of Public Enterprises in this regard are being implemented regularly. Recently, three Independent Directors have been appointed and inducted on the Board of Directors, including one Independent Woman Director. With these inductions, the company has fulfilled the requirement of minimum number of Independent Directors on the Board i.e. one third in case of non-executive chairperson.
A separate Report on Corporate Governance along with certificate from M/s VAP & Associates (CP No.13901) regarding compliance of the stipulations relating to corporate governance specified in Listing Regulations is annexed hereto and forms part of this report. It may be mentioned that the company has complied with the CG norms prescribed by the Department of Public Enterprises applicable for CPSEs and the quarterly reports on compliance of Guidelines of Corporate Governance for CPSEs are sent regularly.
Pursuant to Regulation 15(5) of Listing Regulations, the Code of Conduct applicable to the Board members & senior management personnel has been posted on the website of your company. All Board Members and Senior Management Personnel as on 31st March, 2023 to whom the said Code is applicable have affirmed compliance of the same for the period ended 31st March, 2023. Based on the affirmation received from Board Members and Senior Management Personnel, declaration regarding compliance of Code of Conduct made by the Chairman & Managing Director is given below:
Declaration as required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and DPEâs Guidelines on Corporate Governance
âAll the members of the Board and Senior Management Personnel have affirmed compliance of the âCode of Business Conduct & Ethics for Board Members and Senior Management Personnelâ of the company for the financial year ended on March 31,2023.â
BUSINESS RESPONSIBILITY REPORT
In accordance with the provisions of regulation 34(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has prepared the Business Responsibility & Sustainability Report for inclusion in the Annual Report for the year 2022-23. The framework and principles suggested by SEBI is to assess compliance with environment, social and governance norms pertaining to Sustainable Development Goals. The said Business Responsibility Report is annexed herewith and forms part of the Annual Report.
PUBLIC PROCUREMENT POLICY FOR MICRO & SMALL ENTERPRISES
Under Public Procurement Policy (PPP) issued by the Ministry of Micro, Small and Medium Enterprises, Government of India for Micro & Small Enterprises (MSEs), a minimum of 25% share out of the total procurement of goods and services by Central Ministries/Departments/PSUs are to be made from MSEs. Further out of the 25% target of annual procurement from MSEs, a sub-target of 5% annual procurement from MSEs owned by SC/ST Entrepreneurs and an additional 3% reservation for the Women owned MSEs within the above 25% reservation is applicable vide Gazette Notification dated 09.11.2018. Preference will be given to firms registered with the M/o MSME as per guidelines prescribed under MSMEs Act, 2006.
Pursuant to Public Procurement Policy, during the year 2022-23, total annual procurement by MMTC in respect of administrative requirements was Rs.7.80 Cr., out of which goods and services worth Rs.6.86 Cr. (i.e. 87.9%) were procured from MSEs including MSEs owned by SC/ST Entrepreneurs, Rs.0.49 Cr. (i.e. 7.26%) from MSEs owned by SC/ST entrepreneurs and 1.54 Cr. (22.48%) from MSEs owned by Women Entrepreneurs. On successful execution of the work orders placed on them, payments were released to MSEs..
As on 1st April 2022, there were no outstanding public deposits and the company did not invite/ accept any public deposit during the year ended 31st March, 2023.
Pursuant to Section 92(3) of Companies Act, 2013 a copy of the Annual Return filed during 2022-23 is available on the website of the company: www.mmtclimited.com.
The report of Statutory Auditors for the year 2022-23 along with Management''s reply to the observations of the Statutory Auditors is annexed herewith.
COMMENTS OF COMPTROLLER & AUDITOR GENERAL OF INDIA
The Comptroller & Auditor General of India (C&AG) has given âNILâ comments under section 143 (6) (b) of the Companies Act, 2013 on the Standalone and Consolidated Accounts of the Company for the year ended 31.03.2023 vide Communications dated 28-07-2023 and 03-08-2023 respectively.
Pursuant to provisions of Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, your Company engaged the services of M/s. VAP & Associates, Company Secretaries, New Delhi to conduct the Secretarial Audit of the Company for the financial year ended March 31, 2023. The Secretarial Audit Report (in Form MR-3) along with Managementâs Reply on the observations of the Secretarial Auditor is annexed herewith.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013
Details of investments, loans and guarantees covered under the provisions of Section 186 of the Companies Act, 2013 are given in Notes forming part of the financial statements.
All transactions entered by the Company with Related Parties were in the Ordinary Course of Business. The Audit Committee granted omnibus approval for the transactions undertaken during 2022-23. Suitable disclosures as required under Ind AS-24 have been made in Note 42 of Notes to the financial statements. Details of the transaction are provided in Form AOC-2 which is annexed herewith.
The Policy on Related Party Transactions as approved by the Board of Directors has been uploaded on the Companyâs website at the following link: http://mmtclimited.com/files/related%20party%20transaction%20policy% 20eng.pdf
The Board of Directors approved the Risk Management Policy after the same has been duly recommended by the Audit Committee of Directors to take care of various risks associated with the business undertaken by your company. The details of various Risks associated with the trade conducted by the company and its risk management as practiced by the Company are provided as part of Management Discussions and Analysis Report which is annexed
herewith. Further, the company has implemented Fraud Prevention Policy in order to enforce controls and to aid in prevention and detection of frauds in the Company. The Policy intends to promote consistent legal and ethical organizational behaviour by assigning responsibility for the development of controls, and providing guidelines for reporting and conduct of investigations of suspected fraudulent behaviour.
The Company does not take exposure in volatile commodities/ market condition. Generally, it makes purchases only against confirmed orders backed by appropriate margin money. Guidelines are in place requiring forward foreign exchange cover to be taken in respect of transactions involving MMTC funds.
During the year 2022-23, there was no activity in MICA group of your company. Therefore, pursuant to rule 8(3) of the Companies (Accounts) Rules, 2014, the company does not have anything to report under this head.
As per provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, every listed company is required to disclose the ratio of the remuneration of each director to the median employeeâs remuneration and details of employees receiving remuneration exceeding limits as prescribed from time to time in the Directorsâ Report. However, as per notification dated 5th June, 2015 issued by the Ministry of Corporate Affairs, Government Companies are exempted from complying with provisions of Section 197 of the Companies Act, 2013. Therefore, such particulars have not been included as part of Directorsâ Report.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134(5) of the Companies Act, 2013, your Directors state that:
a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
b) the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for the year ended 31.3.2023;
c) the Directors have taken a 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;
d) the Directors had prepared the annual accounts on a going concern basis.
e) the Directors of your company had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and
f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
g) At present, MMTC is not carrying out any business activity
h) Auditors/CAG comments on annual accounts of MMTC for the year 2022-23 form part of the annual accounts and are available in this report.
DISPUTE BETWEEN MMTC & ANGLO AMERICAN COAL
The Execution Petition No.19/2018 filed by Anglo Coal against MMTC post Honâble Supreme Court award in favour of Anglo Coal in respect of non performance of coking coal contract is pending in Delhi High Court. MMTC deposited Rs.1087 crores approx. on 20.7.2022 to secure the interest of the decree holder. Next date posted to 30.10.2023 for hearing on the application filed by MMTC to stay the proceedings in view of pending CBI complaints.
Following are the changes in the Board of Directors of your company since 1st April 2022: -
Name of the Director |
Category |
Date of Appointment/ Cessation |
Cessation Appointment/ |
Shri Vibhu Nayar |
CMD (Addl. Charge) |
31-08-2022 |
Cessation |
Shri Hardeep Singh |
CMD (Addl. Charge) |
27-10-2022 |
Appointment |
Shri Shashank Priya |
Govt. Nominee Director |
10-01-2023 |
Cessation |
Dr.(Mrs.) Swadhinta Krishna |
Independent Director |
21-01-2023 |
Cessation |
Ms Arti Bhatnagar |
Govt. Nominee Director |
13-03-2023 |
Appointment |
Ms S. Meenakshi |
Independent Director |
9-06-2023 |
Appointment |
Shri Srinivas Rao Maddi |
Independent Director |
10-06-2023 |
Appointment |
Shri Nabarun Nayak |
Independent Director |
3-8-2023 |
Appointment |
Shri J Ravi Shanker |
Executive Director |
4-07-2023 |
Cessation |
The Board places on record its deep appreciation for the commendable services and the contributions made by Shri Vibhu Nayar, Shri Shashank Priya and Dr.(Mrs.) Swadhinta Krishna& Shri J Ravi Shanker Directors who ceased to be on the Board. The Board welcomes new Directors on the Board and expresses its confidence that the Company shall immensely benefit from their rich and varied experience.
In terms of provisions of Article 87(4)(A) of Articles of Association of the Company regarding rotational retirement of Directors, Shri Kapil Kumar Gupta, Director(Finance) shall retire at the AGM and, being eligible, has offered himself for re-appointment.
Your Directors would like to acknowledge and place on record their sincere appreciation of all stakeholders-Shareholders, Department of Commerce, all Govt. Agencies, RBI and other Banks, Railways, Customs, Ports, Customers, Suppliers and other business partners for the excellent support and cooperation received from them during the year. Your Directors also recognize and appreciate the efforts and hard work of all the employees of the Company and their continued contribution towards its progress.
Sd/-
(Hardeep Singh ) Chairman and Managing Director
Dated: 22.09.2023
Mar 31, 2022
On behalf of Board of Directors, I present the 59th Annual Report on your companyâs performance for the financial year ended 31 st March 2022 along with Audited Statements of Accounts and Statutory Auditorsâ Report.
OPERATIONAL RESULTS
Your company has recorded a turnover of Rs.7840.78 crores during 2021-22 as against the turnover of Rs. 26,364.50 crores registered during last fiscal. This business turnover includes Exports of Rs.34.40 crores, Imports of Rs.7070.58 crores and domestic trade of Rs. 735.80 crores. The Company has reported a net loss of Rs. 241.93 crores during 2021-22 as compared to net loss of Rs. 769.69 crores reported during the previous financial year.
Company''s performance during 2021 -22 is given below: -
(Rs. in crores) |
(Rs. in crores) |
|
2021-22 |
2020-21 |
|
Sales of products |
7,836.28 |
26,361.59 |
Sales of services |
4.50 |
2.91 |
OtherTrade Earnings |
552.51 |
17.11 |
Total Revenue from Operations |
8,393.29 |
26,381.61 |
Cost of Sales |
7,799.79 |
26,267.23 |
Gross Profit from Operations |
593.50 |
114.38 |
Add: Dividend and other Income |
50.14 |
36.97 |
Less: Establishment & Administrative Overheads, etc. |
160.56 |
163.33 |
Less: Debts/Claims Written off |
0.02 |
5.80 |
Less: Provisions for Doubtful Debts/Claims/Advances/ Investments |
1.05 |
1.06 |
Profit Before Interest, Depreciation and Amortization Expenses and Taxes |
482.01 |
(18.84) |
Less: Interest Paid(Net) (Interest Paid minus Interest earned) |
201.64 |
193.26 |
Profit Before Depreciation and Amortization Expenses and Taxes |
280.37 |
(212.10) |
Less: Depreciation and Amortization Expenses |
4.57 |
4.94 |
Less: Exceptional Items |
155.20 |
877.17 |
Profit Before Taxes |
120.60 |
(1.094.22) |
Less: Provision for Current Taxes |
21.50 |
0.07 |
Less: Provision for Deferred Taxes |
341.03 |
(324.60) |
Profit After Taxes |
(241.93) |
(769.69) |
Add: Balance brought forward from the previous vear |
(308.86) |
460.83 |
Balance |
||
Items of other comprehensive income recognized directly in retain earnings |
||
Items recoanized directlv in retain eaminqs |
- |
- |
Dividend & Dividend Tax |
- |
- |
Appropriations: |
||
General Reserve |
- |
- |
Leaving a Balance to be carried forward |
(550.79) |
(308.86) |
The performance of different business groups of your Company is highlighted in the Management Discussion and Analysis Report, which is annexed and forms part of this Report. Auditor / CAG report along with management replies and Notes to accounts contain important information affecting company financials such as Loan Re-structuring, Anglo Coal dispute, disinvestment of NINL, etc.
EQUITYSHARE CAPITAL & DIVIDEND
There is no change in equity capital of the company during the year. The paid up equity of the company stood at Rs. 150 crores comprising of 150 crores number of equity shares of the face value of Re.1/- each, as on 31.3.2022. The Board of Directors has not recommended any dividend for the year 2021-22 in view of current liquidity crunch, exhaustion of bank limits and difficulties in meeting its day-to-day working capital requirement and net loss of approx. Rs.241.93 crores incurred by the Company during the year 2021 -22.
A sum of Rs.288.11 crores was available in the reserves and surplus of your Company as on 1st April, 2021. An amount of Rs.46.18 crores is available in "Reserves and Surplus" of your Company as on 31 st March, 2022.
FOREIGN EXCHANGE EARNINGS AND OUTGO
The Foreign Exchange earnings and outgo of your Company during 2020-21 has been as under: -
EARNINGS (Rs./Cr) |
OUTGO (Rs./Cr) |
||
Exports |
116.68 |
Imports |
5994.35 |
Others |
Others |
- |
|
Total |
116.68 |
Total |
5994.35 |
To tap South East Asian market for trading in commodities, MMTC Transnational Pte. Ltd. (MTPL), Singapore, the wholly owned subsidiary of your Company has been engaged in commodity trading and has established itself as a credible and reputable trading outfit in Singapore. During the financial year 2021-22 MTPL achieved sales turnover of USD 456.58 million as against USD 486.20 million recorded during last fiscal. The Net Profit of MTPL during the financial year 2021-22amounted to USD 0.69 million as against USD 1.12 million earned during 2020-21. The net worth of MTPL stood at USD 6.17 million as on 31st March 2022. Overall dividend declared by MTPL since inception is USD 26.94 million which includes a dividend of USD 5.00 million received from MTPL during FY2021-22.
Pursuant to the provisions of Section 129 of the Companies Act, 2013, the audited financial statements of MTPLtogetherwith Directorsâ Reports Auditor''s Report are attached herewith.
MMTC''s Joint Venture-Neelachal IspatNigam Ltd. (NINL)
Your Company set up Neelachal Ispat Nigam Limited (NINL) - an Iron & Steel Plant of 1.1 million tonnes capacity, 0.8 million tone coke oven and by product unit with capitive power plant, jointly with PSUsof Govt, of Odisha and other CPSEs.
Cabinet Committee on Economic Affairs (CCEA) on 8th Jan 2020 had given âin principleâ approval for strategic disinvestment of equity shareholding of MMTC (49.78%), NMDC (10.10%), MECON (0.68%), BHEL (0.68%), IPICOL (12.00%) and OMC (20.47%) in Neelachal Ispat Nigam Limited (NINL) to a strategic buyer, identified through a two-stage auction procedure. Accordingly, Department of Investment and Public Asset Management (DIPAM), under the aegis of Ministry of Finance carried out the due diligence process by appointing Transaction Advisor (TA), Legal Advisor (LA) & Asset Valuer (AV) and by conducting various Inter Ministerial Group (IMG), Evaluation Sub-Committee (ESC) meetings.
The Expression of Interest (EOI) for sale of NINL got completed on 29th March, 2021 and prospective bidders were shortlisted for further due diligence. The shortlisted bidders were issued Request for Proposal (RFP) on 03.12.2021 with closing date as 23.12.2021. Subsequently, evaluation of Technical bids was carried out with due diligence and thereafter, the financial bids were opened on 26.01.2022 after declaration of technically qualified bidders by DIPAM as per due diligence carried out by SBI Caps, Transaction Advisor (TA) and Luthra & Luthra, Legal Advisor (LA). M/s. Tata Steel Long Products Limited (TSLP) emerged as Highest Bidder (H-l) at Bid Enterprise Value (EV) of Rs.12,100 Crore as declared by DIPAM through its Press Release published on 30.01.2022. M/s. TSLP executed LoA acceptance letter covering payment security of Rs.1210 Crore being 10% of the purchase consideration in the form of Bank Guarantee (BG) alongwith the countersigned Letter of Acceptance (LoA) issued by DIPAM to M/s. TSLP.
Share Sale Purchase Agreement (SPA) and Escrow Agreement were executed on 10.03.2022 by and between NINL, Selling Shareholders, M/s. Tata Steel Long Products Limited (TSLP), Tata Steel Limited (TSL), Govt, of India (Represented by MoC)and Govt, of Odisha. TSLP deposited an amount of Rs.1210 crore (10% of bid value) in Escrow Account No.1 (NINL) and the balance amount (90%) was deposited by TSLP into Escrow Account on 01.07.2022. As per SPA, the completion date was scheduled for 24.04.2022.
As per the provisions of SPA & subsequent mutually agreed Long Stop Date, the divestment process of NINL got completed on 04.07.2022 by carrying out all the due diligence process involving all the stake holders, statutory auditor of NINL. In this process, MMTC recovered an amount of Rs.1872.35 Crore (net of withholding tax) through distribution of sale consideration to promoters in the form of equity on 4th July 2022. Total divestment proceeds received by MMTC is Rs.5335 crores as against in equity investment of49.78% in NINL.
Other Projects/ Joint Ventures
To take advantage of new opportunities emerging in the free market environment, your company had promoted a
number of joint ventures following the public-private partnership model in earlier years. A brief on the current status of
such JVs set up in past years is given hereunder:
(I) Your company presently holds 6% equity capital in Indian Commodity Exchange Limited (ICEX) as on 31.3.2022. As per regulation, 17 of SECC Regulations, 2018 in terms of SEBI Circular Reference no. CIR/CDMRD/DEA/03/2015 dated 26 November 2015 holding has to be reduced to 5% or less. MMTC in 2018 and 2019 appointed consultants for valuation and disinvestment of equity in ICEX. However, MMTC did not receive any bids against the RFPs for sale of stake in ICEX; the last such RFP closed on 8.11.2021 .ICEX has not yet finalized its annual report for 2021-22. However, in the financial year 2020-21 operating income was Rs. 1.42 crores and ICEX net loss after tax for the year ended on 31 March 2021 was Rs. 25.67 crores. Balance of loss brought forward was Rs. 204.89 crores. SEBI passed order dated 10.05.2022 for withdrawal of recognition to Indian Commodity Exchange Ltd. and published in the official gazette of India on 18.05.2022. However, Securities Appellate Tribunal (SAT), by its order dated 13 June 2022 has Quashed SEBI order derecognizing ICEX. SAT in its order, dated 13.6.2022 has given ICEX one-year time from 13.6.2022 to complete all compliances to SEBIâs satisfaction, and all trading activities would remain suspended during this period.
(ii) Your company had participated in the equity of Currency Futures Exchange under the name and style of "United Stock Exchange of India Ltd which had been merged with âBSE Limitedâ (BSE) wherein your Company presently holds 116883 (post bonus issue) equity shares of Rs. 21- each in BSE. During the year BSE earned a PAT of Rs.195.12 crores as against Rs. 97.26 crores earned during 2020-21 and paid in the current financial year a dividend of Rs. 15,77,920.50 (Rs. 13.50 on equity share of Rs. 21- each) for the Financial Year 2021-22.
(iii) MMTC-PAMP India Pvt. Ltd., a joint venture Company between MMTC Limited and PAMP SA, Switzerland, operates a precious metals processing facility. MPIPL is Indiaâs first and only LBMA Good Delivery Refinery accredited for Gold and Silver. The Joint Venture achieved a turnover of Rs.29,263.50 crore and a profit (after tax) of Rs.44.79 crore during the period FY 2021-22. No dividend was paid by the JV Company during the last 3 years.
(iv) The JV company - M/s SICAL Iron Ore Terminals Limited (SIOTL) could not commence commercial operations due to non availability of iron ore from Bellary-Hospet Sector in Karnataka State and banning of mining / movement of iron ore for exports by state govt. In view of uncertain future of iron ore exports and to utilize the infrastructure created, Kamarajar Port Trust (erstwhile Ennore Port Trust) decided to award the facility through bidding process for modification of the facility to handle common user coal. As coal does not have synergy with MMTCâs existing line of business, In Septâ2016, MMTC Board decided to exit from the JV. MMTC invited bids through online tender for sale of its entire 26% equity in the SIOTL JV, however no response was received. Meanwhile, as per âRight of First Refusalâ in Shareholders Agreement of SIOTL, SICAL Logistics Ltd; (lead promoter of SIOTL) offered to purchase MMTCâs equity at reserve price fixed by MMTC which MMTC Board decided to accept. Share Purchase Agreement was signed with Sical Logistics Ltd on 31.05.2018 for sale of MMTCâs equity in SIOTL and in terms of the agreement M/s Sical Logistics Ltd had deposited Rs.0.50 Cr (PY Rs.0.50 Cr) with MMTC towards performance of agreement. Time to time, the validity of the SPA was extended. Last extension was valid till 31.03.2020. On account of financial crisis, M/s Sical Logistics could not pay the sale value against SPA and therefore provision for Rs.33.80 crore was created by MMTC on 31.03.2020 towards diminution in value of investment.
In March 2021, NCLT pronounced an order as against M/s Sical Logistics Limited initiating corporate insolvency resolution process pursuant to the application preferred by MOL Toyofuji Automotive Logistics [India] Private Limited and an Insolvency Resolution Professional (IRP) was been appointed. MMTC lodged its claim for Rs.34.26 crores with CIRP (Corporate Insolvency Resolution Professional) towards unpaid share sale consideration based on the SPA.
Meanwhile, on 21.12.2020, KPL issued a Notice of Intent to Terminate to SIOTL alleging a financial default under the License Agreement dated 11.07.2016. On 22.03.2021, KPL issued a 90 daysâTermination Notice to SIOTL with effect from 22.03.2021. On the same date, KPL has also issued a Transfer Information Notice calling for information from JV Co within 30 days, i.e. by 20.04.2021. As suggested by advocates, MMTC filed a writ petition on 24/06.2021 in Madras High Court for settlement of dispute through Administrative Mechanism of Resolution of Dispute (AMRD).
However, Honâble MHC while referring to (Administrative Mechanism for Resolution of Commercial Disputes) AMRCD has opined that âsuch being position of law, this court of the view that remedy available to petitioner is elsewhere and not this courtâ. The Honâble Court vide its order dated 30.11.2021 held that the âwrit petition filed by MMTC itself is not maintainableâ. MMTC has challenged the order vide WA 498 of 2022 & was listed on 28.3.2022/7.4.2022 and is still pending for admission.
The Resolution Professional (RP) in CIRP of SICAL also challenged the impugned termination notice dated 22.03.2021 passed by KPL before NCLT. MMTC moved an application to be impleaded in the said application of the RP. The application of RP was dismissed by NCLT for want of jurisdiction vide Order dated 11.03.2022. As a result, MMTC application was also dismissed.
MMTC has taken opinion of ASG whether MMTC can proceed under AMRCD against KPLand options available to recover its investment. MMTC will be proceeding as per the opinion of ASG. Application is being prepared for settlement of dispute with KPL in AMRCD.
(v) The name of M/s. T M Mining Company Limited has been struck off from the register of companies and the said company dissolved w.e.f. 28.10.2021.
(vi) To promote the concept of Free Trade Warehousing Zones in India as declared in the EXIM Policy, MMTC and I L&FS established SPVIN 2004-05 in the name of Free Trade Warehousing Pvt Ltd. The equity is held on 50:50 basis between MMTC and IL&FS. Two 100% owned subsidiaries of FTWPL were established to administer the land banks at Kandla and Haldia. In view of financial situation of the promoters and the need for infusion of the substantial funds for development of the Project, it was decided by the promoters to exit from the project. Accordingly, the land at Kandla has been surrendered to the Project Authority. KASEZ has raised a claim of Rs.5.57 crores approx, in the JV towards pending lease rentals and user charges. With regard to Haldia Land, local farmers had filed petition against Haldia Development Authority challenging the land acquisition in 2015 and stay was granted by Honâble High Court of Calcutta. Due to prolonged litigation and stay not being lifted, promoters decided to surrender the land to Haldia Development Authority(HDA). Accordingly in March, 2020, land was surrendered to HDAand refund of lease premium as per agreement is being followed up by JV. Refund of proportionate upfront lease rent of Rs.33.48 crores (approx.) is being followed continuously by the SPV (Haldia Free Trade Warehousing Pvt Ltd) out of which MMTC''s share would beRs.16.74cr.
(vii) A15 MW capacity Wind Mill project with 25 Wind Energy Generators was commissioned by MMTC in March, 2007 at Gajendragad in Karnataka. The power generated by the project is sold to HESCOM. The project is running successfully and has contributed to the development of area by meeting some of the power needs of Karnataka State. The turnover of the Wind Mill project during 2021-22 was Rs. 5.42 crores by sale of wind power generated by the wind farm at Gajendragad in Karnataka.
INDUSTRIAL RELATIONS & HUMAN RESOURCE MANAGEMENT
Cordial and harmonious industrial relations were maintained in your company during the year. No man days were lost due to any industrial unrest during the year. Further, meetings with representatives of Federation of Officers Associations/ Staff Unions/ SC&ST Associations, were held with a view to maintain cordial and harmonious industrial relations.
The aggregate manpower of your company as on 31st March, 2022 stood at 597, comprising of 3 Board level Executives, 1 CVO, 277 officers and 320 staff/ worker. The manpower also includes 1 officer and 50 staff/ worker of erstwhile MicaTrading Company Ltd., which had been merged with your company pursuant to the orders of BIFR.
The composite representation of the total manpower is - women employees representing 20.10% (120 employees) of the total manpower; SC, ST, OBC & Persons with Benchmark Disabilities (PwBD) to the extent of 21.61% (129 employees), 11 % (66 employees), 12.06% (72 employees) and 2.34% (14 employees) respectively.
No recruitment was made during the year.
IMPLEMENTATION OF RESERVATION POLICY
Your company has been complying with the Presidential Directives and other instructions/guidelines issued from time to time by the Government of India regarding the reservation in services for Scheduled Castes (SCs), Scheduled Tribes (STs), Other Backward Classes (OBCs), Economically Weaker Sections (EWS), Persons with Benchmark Disabilities (PWBDs) and Ex-servicemen. A statement showing representation of employees belonging to SC/ST/OBC is as below:
Representation of SCs/STs/OBCs/Divyang as on 31.03.2022 |
|||||||||
Group |
Total No. |
SCs of Employees |
%age SCs |
STs |
%age Sts |
OBCs |
%age OBCs |
Divyang |
%age Divyang |
A |
277 |
55 |
19.86 |
21 |
7.58 |
33 |
11.91 |
12 |
4.33 |
B |
182 |
39 |
21.43 |
31 |
17.03 |
4 |
2.20 |
2 |
1.10 |
C |
64 |
14 |
21.88 |
4 |
6.25 |
24 |
37.50 |
0 |
- |
D |
74 |
21 |
28.38 |
9 |
12.16 |
12 |
16.22 |
0 |
- |
Total |
597 |
129 |
21.61 |
65 |
10.89 |
73 |
12.23 |
14 |
2.34 |
Recruitment of SCs/STs/OBCs/Divyang during the year 2021-22 |
|||||||||||||
Group |
Total Recruitment |
SCs |
%age SCs |
STs |
%age STs |
OBCs |
%age OBCs |
Divyang |
%age Divyang |
||||
A |
No recruitment made. |
||||||||||||
B |
No recruitment made. |
||||||||||||
C |
No recruitment made. |
||||||||||||
D |
No recruitment made. |
||||||||||||
Total |
- |
- |
- |
- |
- |
- |
- |
- |
- |
||||
Promotion of SCs/STs during the year 2021-22 |
|||||||||||||
Group |
Total Promotions |
SCs |
%age SCs |
STs |
%age Sts |
||||||||
A |
|||||||||||||
B |
|||||||||||||
C |
|||||||||||||
D |
|||||||||||||
Total |
For further enhancing / upgrading the skills of employees in the constantly changing business scenario, 205 employees were imparted training during the year in different spheres of companyâs activities. Due to pandemic situation in the country and restrictions imposed by the Government to contain it, mostly online training programmes (webinars) were organized. The training interventions held covered both functional & behavioural trainings. The employees deputed for webinars included 33 employees belonging to SC, 12 to ST and 89 women employees.
IMPLEMENTATION OF OFFICIAL LANGUAGE
Your company is fully committed to implement the Official Language Policy of the Government of India. All efforts were made by the company to achieve the targets prescribed in the Annual Programme for the year 2021-22 issued by the Department of Official Language (Ministry of Home Affairs, Govt, of India). In order to promote the usage of Hindi in Company''s day to day work, several programmes viz. Hindi Workshops, Hindi Day/Week/Fortnight were organized at Corporate Office and Regional Offices during the year. This had brought positive results in use of Hindi in day to day official work.
During the year, Dy. Director from Department of Official Language had inspected the Corporate Office for reviewing the progress of implementation of Hindi. He found the implementation of Official Language and the work being done in Hindi in the office as satisfactory. The Hindi website of MMTC has been updated as per English website regularly. During the year, e-version of quarterly Hindi magazine âManikanchanâ was published by MMTC keeping in view the Covid SOP issued by the Govt.
Vigilance Division of MMTC has been laying its emphasis on efficient response system -as per procedure laid down in CVCâs Compliant Handling System while dealing with various CVC referred Complaints/direct complaints. Simultaneously, the scope for Systemic Improvements, if any, while investigating the complaints, is also being taken up as focussed area to strengthen internal controls in Vigilance Division.
During the year Vigilance Division processed 22 complaints (CVC-2, other-20), out of which 20 complaints have been disposed off and action on remaining 2 complaints was in progress as on 31.03.2021. Further during the year Vigilance Division dealt with three Departmental Inquiry Proceedings (2 CVC and 1 Non-CVC) progressing at various stages. In one case of 2016, total 5 officials involved as per CVCâs - SSA, exoneration orders issued by DA for 2 officials. Proceedings in respect of other 3 officials are in progress. In another case involving CVCâs 1 st stage advice, departmental proceeding in respect of 03 officials is under progress. In a non-CVC case involving 09 officials, departmental proceedings have been completed and final order have been issued.
During the year, 50 inspections were conducted by Vigilance Officers(VOs) and 32 by Non-Vigilance Officers(NVOs) of Regional Offices and the inspection reports submitted were processed at Vigilance Division and appropriate action was taken, wherever required. Vigilance Division has conducted 2 CTE type inspections inhouse and also responded with replies to observations of TE,CVC in 2 pending CTE type observations of tenders floated by various divisions of MMTC. Audit Reports of Internal Auditors have also been examined and shortcoming observed were communicated for corrective action. Apart from inspections, Vigilance Division has also scrutinized 145 Annual Property Returns of the employees.
Compliances with respect to ODI, Agreed List(s), MIS updation on DOPT Solve, QPR, CTE-Type QPR, Structured Meetings have been responded to in line with extant guidelines.
Vigilance Division has also conducted various activities during Vigilance Awareness Week 2021, across all its offices from 26.10.2021-01.11.2021 as per instructions of CVC on the theme '' Independent India @75: Self Reliance with Integrityâ. During the week, various activities including Preventive Vigilance Practices, online Integrity Pledge Administration and inhouse (housekeeping) activities were undertaken and compliance report as per Reporting Format was furnished to CVC.
In accordance with the provisions of Section 177 of Companies Act 2013, the Board of your company introduced a Scheme on ''Vigil Mechanismâ in 2014. The vigil mechanism is established for Directors and employees to report their genuine concerns. The concerns, if any, from any employee/Director shall be addressed to the Chairman of the Audit Committee. During the year under review, no such complaint has been received. This mechanism is apart from the Whistle Blower Policy, already in force.
Integrity Pact is promoted as part of series of steps taken by Central Vigilance Commission for ensuring transparency, equity and competitiveness in public procurement. Your Company has also implemented the same to promote transparency/equity amongst the bidders and to plug any possibility of corrupt practices in trade conducted by the Company. Shri Bal Raj, ITS (Retd.), has been appointed to function as Independent External Monitor(IEM)
CORPORATE SOCIAL RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT
Your companyâs CSR Policy is in line with Section 135 of the Companies Act â2013 and the CSR Rules as notified by the Ministry of Corporate Affairs and the CSR projects have been undertaken in terms of Section 135 of the Companies Act. The CSR Policy is hosted on the Companyâs website in bilingual form.
Your company incurred losses during FY 2019-20 and FY 2020-21. Accordingly, the CSR budget calculated in accordance with the Section 198 of the Companies Act, 2013 i.e. 2% of average net profit of preceding 3 years was negative. Therefore, there was no annual CSR budget approved by Board of Directors for the year 2021-22. As such, no fresh CSR project was undertaken during FY 2021-22. However, your company only executed ongoing CSR projects of FY 2019-20 which were carried forward to FY 2021 -22.
In terms of Section-21(b) of the Companies (Amendment) Act 2019, a Special CSR Bank Account was opened for the unspent CSR funds and an unspent amount as on 31.03.2021 amounting Rs. 10.01 lakhs was transferred to the account. The utilization of funds from this account during FY 2021-22 is as below:
Opening Balance (as on 01.04.2021) |
Rs. 10.01 lakhs |
Expenditure during FY2021-22: |
|
(I) Payment of final installment to Shri Deep Chand Educational Society towards Skill Development Program (CSR Project of FY 2019-20). |
Rs. 1.50 lakhs |
(ii) Payment offinal installment to CKS Foundation towards Education of slum children (CSR Project of FY 2019-20). |
Rs. 3.24 laks |
Closing Balance (as on 31.03.2022) |
Rs. 5.27 lakhs |
Corporate Governance has emerged as an important tool to the business community to become efficient, competitive and successful enterprise. Your Company reposes its firm faith in continuous development, adoption and dedication towards the best corporate governance practices. Towards this end, the norms prescribed under the Companies Act, 2013, SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 and Guidelines as applicable for CPSEs issued by the Department of Public Enterprises in this regard are being implemented regularly. However, appointment of vacant positions of Independent Directors as required as on 31.3.2022 is yet to be made by the Government.
A separate Report on Corporate Governance along with certificate from M/s VAP & Associates (CP No. 13901) regarding compliance of the stipulations relating to corporate governance specified in Listing Regulations is annexed hereto and forms part of this report. It may be mentioned that the company has complied with the CG norms prescribed by the Department of Public Enterprises applicable for CPSEs and the quarterly reports on compliance of Guidelines of Corporate Governance for CPSEs are sent regularly.
Pursuant to Regulation 15(5) of Listing Regulations, the Code of Conduct applicable to the Board members & senior management personnel has been posted on the website of your company. All Board Members and Senior Management Personnel as on 31st March, 2022 to whom the said Code is applicable have affirmed compliance of the same for the period ended 31st March, 2022. Based on the affirmation received from Board Members and Senior
Management Personnel, declaration regarding compliance of Code of Conduct made by the Chairman & Managing Director is given below:
Declaration as required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and DPEâs Guidelines on Corporate Governance
âAll the members of the Board and Senior Management Personnel have affirmed compliance of the ''Code of Business Conduct & Ethics for Board Members and Senior Management Personnelâ of the company for the financial yearended on March 31,2022.â
sd/-( on 9.6.2022) VIBHU NAYAR
Ex-CMD DIN: 03590141
BUSINESS RESPONSIBILITY REPORT
In accordance with the provisions of regulation 34(2) of SEBI(Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has prepared the Business Responsibility Report for inclusion in the Annual Report for the year 2021 -22. The framework and principles suggested by SEBI is to assess compliance with environment, social and governance norms pertaining to Sustainable Development Goals. The said Business Responsibility Report is annexed herewith and forms part of the Annual Report.
PUBLIC PROCUREMENT POLICY FOR MICRO & SMALL ENTERPRISES
Under Public Procurement Policy (PPP) issued by the Ministry of Micro, Small and Medium Enterprises, Government of India for Micro & Small Enterprises (MSEs), a minimum of 25% share out of the total procurement of goods and services by Central Ministries/Departments/PSUs are to be made from MSEs. Further out of the 25% target of annual procurement from MSEs, a sub-target of 5% annual procurement from MSEs owned by SC/ST Entrepreneurs and an additional 3% reservation for the Women owned MSEs within the above 25% reservation is applicable vide Gazette Notification dated 09.11.2018. Preference will be given to firms registered with the M/o MSME as per guidelines prescribed under MSMEs Act, 2006.
Pursuant to Public Procurement Policy, during the year 2021-22, total annual procurement by MMTC in respect of administrative requirements was Rs.7.77 Cr., out of which goods and services worth Rs.6.37 Cr. (i.e. 82%) were procured from MSEs including MSEs owned by SC/ST Entrepreneurs, Rs.0.81 Cr. (i.e. 12.83%) from MSEs owned by SC/ST entrepreneurs and 1.4 Cr. (22.09%) from MSEs owned by Women Entrepreneurs.
As on 1st April 2021, there were no outstanding public deposits and the company did not invite/ accept any public deposit during the year ended 31 st March, 2022.
Pursuant to Section 92(3) of Companies Act, 2013 a copy of the Annual Return filed during 2021-22 is available on the website of the company: www.mmtclimited.com.
The report of Statutory Auditors for the year 2021-22 along with Management''s reply to the observations of the Statutory Auditors is annexed herewith.
COMMENTS OF COMPTROLLER & AUDITOR GENERAL OF INDIA
The Comptroller & Auditor General of India (C&AG) has given âNILâ comments under section 143 (6) (b) of the Companies Act, 2013 on the Standalone and Consolidated Accounts of the Company for the year ended 31.03.2022 vide Communication dated 13th September, 2022.
Pursuant to provisions of Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, your Company engaged the services of M/s. VAP & Associates, Company Secretaries, New Delhi to conduct the Secretarial Audit of the Company for the financial year ended March 31, 2022. The Secretarial Audit Report (in Form MR-3) along with Managementâs Reply on the observations of the Secretarial Auditor is annexed herewith.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013
Details of investments, loans and guarantees covered under the provisions of Section 186 of the Companies Act, 2013 are given in Notes forming part of the financial statements. The company''s exposure to JV Company M/s. Neelachal Ispat Nigam Ltd as on 31.3.2022 is Rs.3463.11 crores, including working capital credit facilities.
All transactions entered by the Company with Related Parties were in the Ordinary Course of Business. The Audit Committee granted omnibus approval for the transactions undertaken during 2021-22. Suitable disclosures as required under Ind AS-24 have been made in Note 42 of Notes to the financial statements. Details of the transaction are provided in Form AOC-2 which is annexed herewith.
The Policy on Related Party Transactions as approved by the Board of Directors has been uploaded on the Companyâs website at the following link: http://mmtclimited.com/ files/related%20party%20transaction%20policy %20eng.pdf
The Board of Directors approved the Risk Management Policy after the same has been duly recommended by the Audit Committee of Directors to take care of various risks associated with the business undertaken by your company. The details of various Risks associated with the trade conducted by the company and its risk management as practiced by the Company are provided as part of Management Discussions and Analysis Report which is annexed herewith. Further, the company has implemented Fraud Prevention Policy in order to enforce controls and to aid in prevention and detection of frauds in the Company. The Policy intends to promote consistent legal and ethical organizational behaviour by assigning responsibility for the development of controls, and providing guidelines for reporting and conduct of investigations of suspected fraudulent behaviour.
The Company does not take exposure in volatile commodities/ market condition. Generally, it makes purchases only against confirmed orders backed by appropriate margin money. Guidelines are in place requiring forward foreign exchange coverto be taken in respect of transactions involving MMTC funds.
During the year 2021-22, there was no activity in MICA group of your company as the plant is inoperative. Therefore, pursuant to rule 8(3) of the companies (Accounts) Rules, 2014, the company does not have anything to report under this head.
As per provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, every listed company is required to disclose the ratio of the remuneration of each director to the median employee''s remuneration and details of employees receiving remuneration exceeding limits as prescribed from time to time in the Directorsâ Report. However, as per notification dated 5th June, 2015 issued by the Ministry of Corporate Affairs, Government Companies are exempted from complying with provisions of Section 197 of the Companies Act, 2013. Therefore, such particulars have not been included as part of Directorsâ Report.
DIRECTORS''RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134(5) of the Companies Act, 2013, your Directors state that:
a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
b) the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company forthe year ended 31.3.2022;
c) the Directors have taken a 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;
d) the Directors had prepared the annual accounts on a going concern basis.
e) the Directors of your company had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and
f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
g) At present, MMTC is not carrying out any business activity
h) Auditors/CAG comments on annual accounts of MMTC for the year 2021-22 form part of the annual accounts and are available in this report.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTIVE, PROHIBITION & REDRESSAL) ACT, 2013
Your company has put in place a policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up at Corporate Office & Regional Offices to redress complaints received regarding sexual harassment at workplace. All employees (permanent, contractual, temporary, trainees) are covered under this policy.
No complaint was received by the company under the above Act during the year.
INFORMATION UNDER RIGHT TO INFORMATION (RTI) ACT
Your company as a Public Authority has responded to various compliances under RTI Act,2005. Details of designated First Appellate Authority (FAA), Transparency Officer, Chief Public Information Officer (CPIO)/ Nodal CPIO, Public Information officer (PIOâs) etc. have been displayed on public domain. During the year, a total of 26 RTI applications were received directly / under Sec.6(3) of the RTI Act and all the RTIs have been disposed off. Further, a total of 4 First Appeals were received by FAA during the year, which were also disposed off. Your company has also undertaken âSelf-Assessment Auditâ of the Voluntary Disclosures to be made on public domain (www.mmtclimited.com) in terms of provisions laid down in Section-4 of the RTI Act 2005 and same is submitted for third party audit and final evaluation by CIC.
DISPUTE BETWEEN MMTC & ANGLO AMERICAN COAL
The Execution Petition No. 19/2018 filed by Anglo Coal against MMTC post Hon''ble Supreme Court award in favour of Anglo Coal in respect of non performance of coking coal contract is pending in Delhi High Court. MMTC deposited Rs.1087 crores approx, on 20.7.2022 to secure the interest of the decree holder. Next date of hearing posted to 29.11.2022 for the interim application and 14.12.2022 for the execution petition.
Following are the changes in the Board of Directors of your company since 1 stApril 2021: -
Name of the Director |
Category |
Date of Appointment/ Cessation |
Cessation Appointment/ |
Dr. Pradip Kumar Varma |
Non official Independent Director |
13.11.2021 |
Appointment |
ShriShyamalMisra |
Govt. Nominee Director |
07.12.2021 |
Cessation |
Shri Manjunath G |
Non official Independent Director |
16.12.2021 |
Cessation |
Shri Vipul Bansal |
Govt. Nominee Director |
20.12.2021 |
Appointment |
ShriSanjayChadha |
CMD (Addl. Charge) |
28.02.2021 |
Cessation |
Shri Vibhu Nayar |
CMD (Addl. Charge) |
01.03.2022 31.08.2022 |
Appointment Cessation |
Shri Hardeep Singh |
CMD (Addl. Charge) |
27.10.2022 |
Appointment |
The Board places on record its deep appreciation for the commendable services and the contributions made by the Directors who ceased to be on the Board w.e.f. 1.4.2021 onwards. The Board welcomes Shri Hardeep Singh, CMD(Addl. Charge) who joined the Company after the lastAGM held on 23.4.2022 and expresses its confidence that the Company shall immensely benefit from his rich and varied experience.
In terms of provisions of Article 87(4)(A) of Articles of Association of the Company regarding rotational retirement of Directors, Shri Kapil Kumar Gupta, Director(Finance) shall retire at the AGM and, being eligible, has offered himself for re-appointment.
Your Directors would like to acknowledge and place on record their sincere appreciation of all stakeholders-Shareholders, Department of Commerce, all Govt. Agencies, RBI and other Banks, Railways, Customs, Ports, Customers, Suppliers and other business partners for the excellent support and cooperation received from them during the year. Your Directors also recognize and appreciate the efforts and hard work of all the employees of the Company and their continued contribution towards its progress.
Sd/-
(Hardeep Singh ) Chairman and Managing Director
Dated: 9.11.2022
Mar 31, 2018
DIRECTORS'' REPORT
The Members MMTC Limited,
New Delhi.
Ladies & Gentlemen,
On behalf of Board of Directors, I have the pleasure of presenting the 55th Annual Report on your company''s performance for the financial year ended 31st March 2018 along with Audited Statements of Accounts and Statutory Auditor''s Report.
OPERATIONAL RESULTS
Your company, one of the leading trading companies in India, recorded a turnover of Rs, 15,757 crore during 2017-18 as against the turnover of Rs, 11,593 crore registered during last fiscal. This business turnover includes Exports of Rs, 1795 crore, Imports of Rs, 11,878 crore and domestic trade of Rs, 2084 crore. The Company has reported a net profit of Rs, 48.84 crore in the current fiscal compared to Rs, 57.06 crore earned last year. The outgo has increased this year on account of pay revision and one time provision of gratuity due to enhancement in ceiling of gratuity limit.
The highlights of the Company''s performance during 2017-18 are as below:_(Rs,in crore)
2017-18 |
2016-17 |
|
Sales of products |
15,746.49 |
11,568.00 |
Sales of services |
10.43 |
25.43 |
Other Trade Earnings |
693.89 |
114.93 |
Total Revenue from Operations |
16,450.81 |
11,708.36 |
Cost of Sales |
16,117.36 |
11,483.91 |
Gross Profit from Operations |
333.45 |
224.45 |
Add: Dividend and other Income |
46.43 |
14.57 |
Less: Establishment & Administrative Overheads, etc. |
307.12 |
247.71 |
Less: Debts/Claims Written off/withdrawn |
0.05 |
0.66 |
Less: Provisions for Doubtful Debts/ Claims/Advances/Investments |
- |
0.48 |
Profit Before Interest, Depreciation and Amortization Expenses and Taxes |
72.71 |
(9.83) |
Add: Interest Earned (Net) (Interest earned minus Finance Cost) |
0.07 |
6.47 |
Profit Before Depreciation and Amortization Expenses and Taxes |
72.78 |
(3.36) |
Less: Depreciation and Amortization Expenses |
5.24 |
6.68 |
Less: Exceptional Items |
8.41 |
(91.27) |
Profit Before Taxes |
59.13 |
81.23 |
Less: Provision for Current Taxes |
13.32 |
27.45 |
Less: Provision for Deferred Taxes |
(3.03) |
(3.28) |
Profit After Taxes |
48.84 |
57.06 |
Add: Balance brought forward from the previous year |
718.94 |
697.98 |
Balance |
||
Items of other comprehensive income recognized directly in retained earnings |
||
Re-measurements of post-employment benefit obligation net of tax |
- |
0.01 |
Dividend & Dividend Tax |
(36.11) |
(36.11) |
Appropriations: |
||
General Reserve |
(10.00) |
- |
Leaving a Balance to be carried forward |
721.67 |
718.94 |
The performance of different business groups of your Company is highlighted in the Management Discussion and Analysis Report, which is annexed and forms part of this Report.
Awards and rankings
f "Gold Trophy" for the year 2014-15 under Merchant Exporter category by Northern Region of EEPC
f "pecial Trophy for Exports of MEIS items in the Merchant Category in the National Award category by EEPC
f IIGC 201 7 award for "Promising Government Nominated Agency for supply of bullion for 2017".
f "FGC 2017 Award for "The Best Nominated Agency for supply of silver to exporters" f "Best Agency supplying gold to Highest Number of Clients" FY 2017-18 by GJEPC.
EQUITY SHARE CAPITAL & DIVIDEND
The Board of Directors recommends declaration of dividend @ 30% on the paid up equity capital of Rs, 100 crore of the Company as on 31.3.2018 for the year 2017-18 out of profits of the Company which is equivalent to 20% on the post-bonus issue paid up capital of Rs, 150 crores. During the year, in accordance with the directives of Department of Public Assets & Management (DIPAM), Govt. of India applicable for all CPSEs, on 19th March 2018 Board of your company has recommended issue of bonus shares to the existing shareholders of the company in the ratio of 1:2 i.e. one bonus share of Re.1/- each for every two equity shares held by the shareholders as on the record date. During the current Financial Year upon receipt of approval of shareholders through postal ballot, the Authorized Share Capital was increased from Rs, 100 crores to Rs, 200 cr. Post bonus issue, the paid up capital of the company has increased from Rs, 100 crores to Rs, 150 crores comprising of 150 crores of equity shares of Re.1/- per share(face value). The entire process of bonus issue has since been completed with the transfer of appropriate proceeds being effected to the shareholders on fractional bonus shares upon disposal of such fractional bonus shares through the Independent Trustee appointed by the Board of Directors.
RESERVES
A sum of Rs, 1336.72 crore was available in the reserves and surplus of your Company as on 1st April, 2017. Your Directors have proposed that Dividend at the rate of 30% on the equity capital as on 31st March, 2018 (Rs, 100 crore) be paid out of profits of the Company which comes to 20% on the post Bonus Paid Up Capital of Rs, 150 crores. Accordingly, an amount of Rs, 1348.64 crore was available in "Reserves and Surplus" of your Company as on 31st March, 2018.
FOREIGN EXCHANGE EARNINGS AND OUTGO
The Foreign Exchange earnings and outgo of your Company during 2017-18 has been as under:-
EARNINGS |
OUTGO |
||
Rs, in crore |
Rs, in crore |
||
Exports |
1795.37 |
Imports |
11,007.75 |
Others |
1.57 |
Others |
41.49 |
Total |
1,796.94 |
Total |
11,049.24 |
SUBSIDIARY COMPANY
The wholly owned subsidiary of your Company - MMTC Transnational Pte. Ltd. Singapore (MTPL) incorporated in October 1994 with the objective to take advantage of liberalization/globalization of trade and commerce to tap South East Asian market for trading in commodities has been engaged in commodity trading and has established itself as a credible and reputable trading outfit in Singapore. During the financial year 2017-18 MTPL achieved sales turnover of US$ 11.84 million as against US$ 113.17 million during last fiscal. The Net Loss of MTPL during the financial year 2017-18 amounted to US$ 0.38 million as against Net Profit of US$ 0.04 million earned during 2016-17. The net worth of MTPL stood at US$ 12.01 million as on 31st March 2018.
Pursuant to the provisions of Section 129 of the Companies Act, 2013, the audited financial statements of MTPL together with Directors'' Report & Auditor''s Report are attached herewith.
MMTC''S PROMOTED PROJECT- Neelachal Ispat Nigam Ltd. (NINL)
Your company has set up Neelachal Ispat Nigam Limited (NINL) - an iron & steel plant of 1.1 million tonnes capacity, 0.8 million tonne coke oven and by product unit with captive power plant, jointly with Govt. of Odisha and others. The phase-II of the Project for production of steel, with Basic Oxygen Furnace, Oxygen Plant and SMS has been commissioned and Steel Billets Production was done on trial basis. During the year 2017-18, NINL achieved a turnover of Rs, 882.58 crore and incurred net loss of Rs, 377.67 crore. This was primarily due to recession in the economy and steel sector in particular and increase in cost of raw materials imported for the Plant. After lot of persuasion and efforts, finally NINL could sign Iron Ore Mining Lease on captive basis with Govt. of Odisha for 874.24 hectare having 92 million tonne of mineable iron ore reserves in the State of Odisha. Mines are planned to commission iron ore production by March, 2019. NINL has also signed MOU with NALCO for setting up of Coal Tar Pitch Plant. With the stabilization of steel making facility and starting of iron ore mining by end of current financial year, NINL''s performance is expected to improve considerably as also increase in production capacity.
Projects/ Joint Ventures
To take advantage of new opportunities emerging in the free market environment, your company has promoted a number of joint ventures following the public-private partnership model in earlier years. A brief on the current status of such JVs set up in past years is given hereunder:
(i) Your Company holds 9.55% equity capital in Indian Commodity Exchange Limited (ICEX) as on 31.3.2018 out of total paid up capital of Rs, 167.5 crores. During the year under review ICEX has reported a net loss of Rs, 13.36 crore as against net loss of Rs, 14.85 crore during 2016-17. ICEX has got necessary approval from SEBI for launching diamond contracts apart from obtaining ''in principle'' approval for trading in contracts for Brent Crude and WTI Crude. It has since got clearance from SEBI for restarting its trading operations. It has also been decided by ICEX and NMEX to merge NMEX with ICEX.
(ii) Your company had participated in the equity of Currency Futures Exchange under the name and style of "United Stock Exchange of India Ltd which had been merged with "BSE Limited" (BSE) wherein your Company holds 38,961 equity shares of Rs, 2/- each in BSE. During the year BSE earned a net profit of Rs, 563.95 crore against Rs, 198.64 crore in 2016-17 and recommended a dividend of Rs, 31/- on equity share of Rs, 2/- each. The shares of BSE has since been listed on National Stock Exchange(NSE).
(iii) The joint venture for medallion manufacturing unit participated as 26% equity partner in collaboration with PAMP Switzerland in the name of MMTC-PAMP India Pvt. Ltd. achieved a turnover of Rs, 34022.43 crore and profit after tax of Rs, 43.69 crore during 2017-18. MMTC has received an interim dividend of 30% for its investment in MMTC-PAMP India Pvt. Ltd. for FY 2017-18. MMTC-PAMP India Pvt. Ltd became India''s first LBMA accredited refiner for Gold and silver. During 2017-18 MMTC has sold Gold Bars produced by MPIPL in the domestic market achieving a turnover of Rs, 481 crore and sale of silver bar of Rs, 170 crore.
(iv) For effective marketing of the finished products of both medallions and jewellery, your company had set up a JV Company, in partnership with a leading Indian company under the name and style of MMTC Gitanjali Limited for setting up retail stores at various cities in India. MMTC Gitanjali Limited has not reported turnover for the year 2017-18 as against turnover of Rs,26.62 crore during 2016-17. The business got interrupted midway during the year 2017-18 and MMTC has exercised the "Exit" option from the said joint venture in terms of SHA signed with the Promoters of the Company.
(v) The JV Company - M/s. SICAL Iron Ore Terminals Limited (SIOTL) could not commence commercial operations due to non-availability of iron ore for exports from Bellary-Hospet Sector in Karnataka State. In view of uncertain future of iron ore exports and to utilize the infrastructure created, Kamarajar Port Trust (erstwhile Ennore Port Trust) decided to award the facility through bidding process for modification of the facility to also handle common user coal. As coal does not have synergy with MMTC''s existing line of business, MMTC Board has decided to exit from the JV. MMTC invited bids through open tender for sale of its entire 26% equity in the SIOTL JV, however, no response was received. Meanwhile, as per "Right of First Refusal'' in Shareholders Agreement of SIOTL, Sical Logistics Ltd(lead promoter of SIOTL) offered to purchase MMTC''s equity at reserve price fixed by MMTC which MMTC Board has decided to accept. Currently, process is on for sale of MMTC''s 26% equity in SIOTL to Sical Logistics Ltd.
(vi) TM Mining Company Ltd.-your company''s JV with M/s TATA Steel Ltd. for mining, exploration and allied activities. However, as the JV company was not able to generate any business since inception, MMTC Board has accorded approval for filing of necessary documents with Registrar of Companies (RoC) by the JV Company to ''strike off'' the name of the JV company from the records of RoC. Lead promoter (Tata Steel) has been apprised accordingly.
(vii) To facilitate promotion of two-way trade, the SPV promoted by your Company in association with IL&FS IIDC has been allotted land to set up International Cargo hub at Haldia and Free Trade and Warehousing Zone at Kandla on lines similar to Special Economic Zone. Two plots of 2.75 acres of land in the Kandla FTWZ has been leased in March, 2016 and the annual revenue is Rs, 24.73 lakhs. Discussions are on with the other units for leasing out the plots. The Development Commissioner had granted approval for setting up a unit within Kandla FTWZ.
(viii) A 15 MW capacity Wind Mill project with 25 Wind Energy Generators commissioned by MMTC way back in March, 2007 at Gajendragad in Karnataka, is running successfully and has contributed to the development of the area by meeting some portion of energy needs of Karnataka state. The power generated from the project is sold to HESCOM. The turnover of the project during 2017-18 was Rs, 6.90 crore with a profit of Rs, 5.18 crore.
INDUSTRIAL RELATIONS & HUMAN RESOURCE MANAGEMENT
Cordial and harmonious industrial relations were maintained in the Company during the year. No man days were lost due to any industrial unrest during the year. Regular meetings were held with the Federation/ Unions / Associations of Officers, Staff and SC/ST Employees under Joint Consultative Machinery Forum. The aim of these meetings is to mitigate the grievances of the employees, exchange of information/ideas with a view to achieve Company''s goals and objectives.
The aggregate manpower of the company as on 31st March, 2018 stood at 1127, comprising of 5 Board level functional executives, 1 CVO, 441 Officers and 579 staff. This manpower includes 3 officers, 98 staff / workers of erstwhile Mica Trading Company Ltd., which had been merged with your company pursuant to the orders of BIFR. The composite representation of the total manpower is - women employees representing 21.30% (240 employees) of the total manpower; SC, ST, OBC & persons with disabilities (PWD) to the extent of 20.67% (233 employees), 9.41% (106 employees), 10.20% (115 employees) and 2.04% (23 employees) respectively. During the year 12 officers were inducted through open advertisement.
RESERVATION POLICY
Policy for reservations for SCs, STs, OBCs and PWD categories in services was followed fully as per the government guidelines in recruitment and promotion.
TRAINING AND DEVELOPMENT
For further enhancing / upgrading the skills of employees in the constantly changing business scenario, 436 employees were imparted training during the year in different spheres of company''s activities. This was done through programs organized in association with in-house faculty as well as external resource persons from renowned institutions/organizations. The employees deputed for training had adequate representation of SC, ST and women employees (SC- 78, ST- 46 and women -180). In terms of man days, such training works out to 688 training man days during the year 2017-18.
IMPLEMENTATION OF OFFICIAL LANGUAGE
The Company is fully committed to implement Official Language Policy of the Government of India. Best efforts were made to achieve the targets prescribed in the Annual Programme for the year 2017-18 issued by the Department of Official Language, Ministry of Home Affairs, Govt. of India. To promote the usage of Hindi in Company''s day-to-day work, several programs viz. Hindi Workshops/Hindi Typing, training on Computers/Hindi Day/Week/Fortnight were organized at Corporate Office and Regional Offices during the year. This has brought positive results and a considerable increase of use of Hindi was observed in day to day official work.
During the year under review, the Hon''ble Drafting and Evidence Sub Committee of Parliament on Official Language had included our Delhi Regional Office in their Discussion Programme while the Committee of Parliament on Official Language inspected our Regional Office Visakhapatnam for reviewing the progress of implementation of Hindi. Both the Committees had found our performance satisfactory. Three of our officials from Corporate Office had been awarded by Town Official Language Implementation Committee(PSUs), Delhi-I for their participation in the competitions conducted by different members of TOLIC.
VIGILANCE
The Vigilance Wing of your Company continued its focus on preventive vigilance to foster the goodwill & confidence stemming from value based business practices and for strengthening the Company as a professionally managed, globally competitive and internationally reputed organization. With the initiatives of Vigilance Division of your Company, various drills/manuals have been prepared and implemented. Under the new initiatives through video conference, quick redressal of problem and issues at regional level was introduced. Vigilance Division is also instrumental in overhauling of Systems and Procedures to detect and deal with the system failures and effective observance of conduct rules. During the period under review, a total number of 8 cases (involving 38 officials) were dealt by Vigilance Division. One fresh case (involving 1 official) was added to the opening tally of 7 cased (involving 37 officials). Status of the disciplinary cases as on 31.03.2018 is as under:
Position as on |
Receipt during |
Disposed |
Balance as on |
1.4.2017 |
1.4.2017 to |
1.4.2017- |
31.03.2018 |
31.3.2018 |
31.3.2018 |
||
7 cases |
1 case (involving 1 |
4 cases (involving 19 |
5 cases |
(involving 37 officials) |
officials) |
officials) |
(involving 19 officials) |
Steps have been taken to streamline vigilance inspections conducted by VOs/NVOs. A system of quarterly/ yearly review of such inspections by Vigilance Division/CO is already in place. During the period under review, 186 vigilance and 42 non-vigilance inspection reports were received from VOs posted at various Regional Offices of MMTC. The same were timely processed and appropriate action was taken, wherever required. During the year, the vigilance division also processed 6 complaints (5 were carried over from last year and 1 new complaint was received). Out of 6 complaints. 5 complaints have been disposed of and action on remaining 1 complaint is in progress. Division is also instrumental in organizing "Vigilance Awareness Week" in various offices of MMTC from 30.10.2017 to 4.11.2017 with the theme of "My Vision - Corruption Free India". Training to Vigilance and Non-Vigilance Officers has been imparted on zonal basis for sensitizing the employees about the preventive vigilance aspect. During the period under review knowledge sharing sessions were held at Corporate Office to share the knowledge on trade activities, law, RTI and Vigilance matters to the newly joined executives and update the knowledge of other officers.
VIGIL MECHANISM
In accordance with the provisions of Section 177 of Companies Act 2013, the Board of your company introduced a Scheme on ''Vigil Mechanism'' in 2014. The vigil mechanism is established for Directors and employees to report their genuine concerns. The concerns, if any, from any employee/Director shall be addressed to the Chairman of the Audit Committee. During the year under review, no such complaint has been received. This mechanism is apart from the Whistle Blower Policy, already in force.
INTEGRITY PACT
Integrity Pact is promoted as part of series of steps taken by Central Vigilance Commission for ensuring transparency, equity and competitiveness in public procurement. Your Company has also implemented the same to promote transparency/equity amongst the bidders and to plug any possibility of corrupt practices in trade conducted by the Company. Shri D.R.S. Chaudhary IAS (Retd.), has been appointed to function as Independent External Monitor(IEM).
CORPORATE SOCIAL RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT
MMTC''s CSR Policy is in line with Section 135 of the Companies Act and the CSR Rules as notified by the Ministry of Corporate Affairs. The CSR Projects are being undertaken in terms of Section 135 of the Companies Act. The new CSR Policy is hosted on MMTC''s website.
In compliance to CSR Rules, your Company in its endeavor to continue its commitment towards CSR & Sustainability initiatives during the year 2017-18 a sum of '' 1.26 crore was allocated for undertaking the CSR activities which was equivalent to 2% of the average net profit of preceding three years.
The funds allocated during 2017-18 under CSR were spent towards activities majorly related to the Swachh Bharat Abhiyan, Clean Ganga Mission, Skill India Mission, Promotion of Art & Culture and Sports. Besides this, MMTC supported distribution of artificial limbs and assistive devices to the differently abled. The annual report on CSR activity undertaken by your Company during 2017-18 is annexed to this Report.
CORPORATE GOVERNANCE
Your Company reposes its firm faith in continuous development, adoption and dedication towards the best corporate governance practices. Towards this end, the norms prescribed under the Companies Act, 2013, SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 and Guidelines applicable for CPSEs issued by the Department of Public Enterprises in this regard are being implemented in letter and spirit. However, appointment of woman director on the Board of the company including two Independent Directors as required as on 31.3.2018 is yet to be made by the Government.
A separate Report on Corporate Governance along with certificate from M/s Blak & Co.(CP No.11714) regarding compliance of the stipulations relating to corporate governance specified in Listing Regulations is annexed hereto and forms part of this report. It may be mentioned that the company has complied with the CG norms prescribed by the Department of Public Enterprises applicable for CPSEs and a quarterly reports in this regard are sent regularly.
CODE OF CONDUCT
Pursuant to Regulation 15(5) of Listing Regulations, the Code of Conduct applicable to the Board members & senior management personnel has been posted on the website of your company. All Board Members and Senior Management Personnel as on 31st March, 2018 to whom the said Code is applicable have affirmed compliance of the same for the period ended 31st March, 2018 except one CGM(under suspension). Based on the affirmation received from Board Members and Senior Management Personnel, declaration regarding compliance of Code of Conduct made by the Chairman & Managing Director is given below:
Declaration as required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and DPE''s Guidelines on Corporate Governance
"All the members of the Board and Senior Management Personnel except one CGM(under suspension), have affirmed compliance of the ''Code of Business Conduct & Ethics for Board Members and Senior Management Personnel'' of the company for the financial year ended on March 31, 2018.
BUSINESS RESPONSIBILITY REPORT
In accordance with the provisions of regulation 34(2) of SEBI(Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has prepared the Business Responsibility Report for inclusion in the Annual Report for the year 2017-18. The framework and principles suggested by SEBI to assess compliance with environment, social and governance norms pertaining to Corporate Social Responsibility and Sustainable Development activities of the Company. The Business Responsibility Report of your Company is annexed herewith and forms part of the Annual Report.
PUBLIC PROCUREMENT POLICY FOR MICRO & SMALL ENTERPRISES
With effect from 1st April, 2015 it is mandatory to procure 20% of total procurement of products and services from the Micro and Small Enterprises (MSEs). Out of 20% target of annual procurement from MSEs, a sub target of 20% (i.e. 4% of 20%) shall be earmarked for MSEs owned SC/ST entrepreneurs. Pursuant to Public Procurement Policy, during the year 2017-18, total annual procurement by MMTC in respect of administrative requirements was '' 10.82 Cr., out of which goods and services worth '' 5.73 Cr.(i.e. 52.96% against minimum required percentage of 20%) were procured from MSEs including MSEs owned by SC/ST Entrepreneurs and '' 0.86 Cr.(i.e. 39.74% approx. as against the stipulated guidelines of 4% out of 20%) from MSEs owned by SC/ST entrepreneurs. On successful execution of the work orders placed on them, timely payments were released to MSEs.
PUBLIC DEPOSIT SCHEME
As on 1st April 2018, there were no outstanding public deposits and the company did not invite/ accept any public deposit during the year ended 31st March, 2018.
ANNUAL RETURN
The extracts of Annual Return pursuant to provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is furnished in prescribed form-MGT-9 and the same is annexed herewith.
STATUTORY AUDITOR''S REPORT
The report of Statutory Auditors for the year 2017-18 along with Management''s reply to the observations of the Statutory Auditors is annexed herewith.
COMMENTS OF COMPTROLLER & AUDITOR GENERAL OF INDIA
The Comptroller & Auditor General of India (C&AG) has given nil comments under section 143 (6) (b) of the Companies Act, 2013 on the Standalone Accounts of the Company for the year ended 31.03.2018. The Communication dated 30.7.2018 of C&AG of India in this regard is annexed herewith. However, the comments of C&AG of India on the consolidated accounts of the company for the year ended 31.3.2018 are yet to be received and the same along with Management''s reply thereon, if any, shall be placed on the table at the Annual General Meeting.
SECRETARIAL AUDIT
Pursuant to provisions of Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, your Company engaged the services of M/s. Blak & Co., Practicing Company Secretaries, New Delhi to conduct the Secretarial Audit of the Company for the financial year ended March 31, 2018. The Secretarial Audit Report (in Form MR-3) along with Management''s Reply on the observations of the Secretarial Auditor is annexed herewith.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013
Details of investments, loans and guarantees covered under the provisions of Section 1 86 of the Companies Act, 2013 are given in Note 6,11,34 & 36 respectively of the Notes forming part of the financial statements. The company has extended working capital credit facilities limit of '' 80 crores during the financial year 2017-18 in addition to previous existing limit of '' 1345 crore to meet the day to day operational activities of the JV company - M/s Neelachal Ispat Nigam Limited in accordance with provisions of Section 186 of Companies Act 2013 duly approved by the Board.
RELATED PARTY TRANSACTIONS
All transactions entered by the Company with Related Parties were in the Ordinary Course of Business and not at Arm''s Length basis. The Audit Committee granted omnibus approval for the transactions undertaken during 2017-18. The approval of the Board and Shareholders at the AGM for such Related Party Transactions were taken. Suitable disclosures as required under Ind AS-24 have been made in Note 42 of Notes to the financial statements. Details of the transaction are provided in Form AOC-2 which is annexed herewith.
The Policy on Related Party Transactions as approved by the Board of Directors has been uploaded on the Company''s website at the following link:
http://mmtclimited.com/files/related%20party%20transaction%20policy%20eng.pdf
RISK MANAGEMENT POLICY
The Board of Directors approved the Risk Management Policy after the same has been duly recommended by the Audit Committee of Directors to take care of various risks associated with the business undertaken by your company. The details of Risk Management as practiced by the Company is provided as part of Management Discussion and Analysis Report which is annexed herewith.
CONSERVATION OF ENERGY
During the year 2017-18, there was no activity in Mica group of your company. Hence the provisions of Rule 8(3) of Companies (Accounts) Rules, 2014 are not applicable.
PARTICULARS OF EMPLOYEES
Pursuant to provisions of Rule 5(2) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, as amended from time to time, it is stated that there were no employees who were in receipt of remuneration exceeding '' 60 lakhs per annum or '' 5.00 lakhs per month during the year 2017-18.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134(5) of the Companies Act, 2013, your Directors state that:
a) i n the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
b) t he Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for the year ended 31.3.2018;
c) the Directors have taken a 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;
d) the Directors had prepared the annual accounts on a going concern basis.
e) the directors of your company had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and
f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013
The Company has put in place a Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. An Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment at work place. All employees (permanent, contractual, temporary, trainees) are covered under this policy.
No complaints were received by the Company under the above Act during the year under review.
INFORMATION UNDER RTI ACT, 2015
During the year 2017-18, in all 44 applications seeking information under RTI Act, 2005 were received from the RTI applicants. The information sought by the RTI applicants were provided in time to all the applicants without any delay. Also online RTI Quarterly Returns were filed on the website of Central Information Commission.
BOARD OF DIRECTORS
Following are the changes in the Board of Directors of your company since 1st April 2017:-
Name of the Director |
Category |
Date of Appointment/ Cessation |
Appointment/ Cessation |
Shri Anand Trivedi |
Director(Marketing) |
03.07.2017 |
Cessation |
Dr. Inder Jit Singh |
Govt. Nominee Director |
28.09.2017 |
Cessation |
Shri Sunil Kumar |
Govt. Nominee Director |
17.10.2017 |
Appointment |
Shri J.K. Dadoo |
Govt. Nominee Director |
16.03.2018 |
Cessation |
Dr. S.C. Pandey |
Govt. Nominee Director |
19.03.2018 |
Appointment |
Shri Umesh Sharma |
Director(Finance) |
11.10.2017 |
Appointment |
Shri RK. Jain |
Director(Marketing) |
14.05.2018 |
Cessation |
Shri J.Ravi Shanker |
Director(Marketing) |
04.07.2018 |
Appointment |
The Board places on record its deep appreciation for the commendable services and the contributions made by the Directors who ceased to be on the Board w.e.f. 1.4.201 7 onwards. The Board also welcomes S/Sh Sunil Kumar, Dr.S.C. Pandey, Shri Umesh Sharma and Shri J.Ravi Shanker and expresses its confidence that the Company shall immensely benefit from their rich and varied experience.
In terms of provisions of Article 87(4)(A) of Articles of Association of the Company regarding rotational retirement of Directors, Shri A Sondhi, Director(Marketing) shall retire at the AGM and, being eligible, has offered himself for reappointment.
ACKNOWLEDGEMENTS
Your Directors would like to acknowledge and place on record their sincere appreciation of all stakeholders-Shareholders, Department of Commerce, all Govt. Agencies, RBI and other Banks, Railways, Customs, Ports, Customers, Suppliers and other business partners for the excellent support and cooperation received from them during the year. Your Directors also recognize and appreciate the efforts and hard work of all the employees of the Company and their continued contribution towards its progress.
By the Order of the Board
Sd/-
Dated: 14.08.2018 (Ved Prakash)
Chairman & Managing Director
DIN No: 02988628
Mar 31, 2017
DIRECTORS'' REPORT
The Members MMTC Limited,
New Delhi.
Ladies & Gentlemen,
On behalf of Board of Directors, I have the pleasure of presenting the 54th Annual Report on your companyâs performance for the financial year ended 31st March 2017 along with audited statements of accounts and Statutory Auditor''s Report.
OPERATIONAL RESULTS
Your company, one of the leading trading companies in India, recorded a turnover of Rs,115934.28 million during 2016-17 as against the turnover of Rs,124606.41 million registered during last fiscal. This business turnover includes Exports of Rs,15801.4 million, Imports of Rs,84802.6 million and domestic trade of Rs,15330.3 million. The Company has reported a net profit of Rs,570.59 million in the current fiscal compared to Rs.548.93 million earned last year.
The highlights of the Company''s performance during 2016-17 are as below: -
(Rs, in Million)
2016-17 |
2015-16 |
|
Sales of products |
115,680.01 |
124,344.04 |
Sales of services |
254.27 |
262.37 |
Other Trade Earning |
1,149.30 |
1,083.19 |
Total Revenue from Operations |
117,083.58 |
125,689.59 |
Cost of Sales |
114,839.06 |
123,724.47 |
Gross Profit from Operations |
2,244.52 |
1,965.12 |
Add: Dividend and other Income |
145.71 |
278.37 |
Less: Establishment & Administrative Overheads, etc. |
2,477.12 |
2,549.60 |
Less: Debts/Claims Written off |
6.61 |
0.97 |
Less: Provisions for Doubtful Debts/ Claims/ Advances / Investments |
4.80 |
2.80 |
Profit Before Interest, Depreciation and Amortization Expenses and Taxes |
(98.30) |
(309.89) |
Add: Interest Earned (Net) (Interest earned minus Finance Cost) |
64.66 |
293.33 |
Profit Before Depreciation and Amortization Expenses and Taxes |
(33.64) |
(16.55) |
Less: Depreciation and Amortization Expenses |
66.78 |
57.97 |
Less: Exceptional Items |
(912.74) |
(653.67) |
Profit Before Taxes |
812.32 |
579.14 |
Less: Provision for Current Taxes |
274.53 |
44.20 |
Less: Provision for Deferred Taxes |
(32.80) |
(14.00) |
Profit After Taxes |
570.59 |
548.93 |
Add: Balance brought forward from the previous year |
6,979.76 |
6,824.29 |
Items of other comprehensive income recognized directly in retain earnings |
Remeasurements of post employment benefit obligation net of tax |
0.09 |
(8.54) |
Unamortized premium on forward contract |
- |
7.36 |
Transfer from Corporate Social Responsibility |
- |
0.07 |
Dividend & Dividend Tax |
(361.07) |
(300.89) |
Appropriations: |
||
General Reserve |
- |
(100.00) |
Other Adjustments |
- |
8.54 |
Leaving a Balance to be carried forward |
7,189.37 |
6,979.76 |
The performance of different business groups of your Company is highlighted in the Management Discussion and Analysis Report, which is annexed and forms part of this Report.
Awards and rankings
- CAPEXIL Award for total minerals exports during 2014-15. It is the 24th time in a row that MMTC has won CAPEXIL''s most coveted award in the highest category.
- âBest Agency Supplying Gold to Highest Number of Clientsâ FY 2015-16 by GJEPC.
- âBest Nominated Agencyâ for FY 2015-16 at the Indian International Gold Convention 2016.
- âBest Nominated Agencyâ for FY 2015-16 at the Bullion Federation Global Convention 2016.
- Special Trophy for Excellence in Exports of MEIS Items in the Merchant category by EEPC.
- Star Performer Award for year 2014-15 in the product group - Basic Iron and Steel (Large Enterprise) by the Engineering Export Promotion Council
- India Lead Zinc Development Association for contributions to international trade in minerals & metals.
- Best Achiever Award for major industries (PSU) at Utkal Chamber of Commerce and Industry (UCCI) EXPO 2017
- Navbharat CSR Leadership Summit Award for best CSR Practices in community development 2016
- Special Incentive Award for best performance in official language in 2016-17.
EQUITY SHARE CAPITAL & DIVIDEND
The Board of Directors recommends declaration of dividend @ 30% on the equity capital of Rs,1,000 million of the Company for the year 2016-17 out of profits of the Company.
RESERVES
A sum of Rs,13149.58 million was available in the reserves and surplus of your Company as on 1st April, 2016. Your Directors have proposed that Dividend at the rate of 30% be paid out of profits of the Company. Accordingly, an amount of Rs,13359.15 million was available in "Reserves and Surplusâ of your Company as on 31st March, 2017.
FOREIGN EXCHANGE EARNINGS AND OUTGO
The Foreign Exchange earnings and outgo of your Company during 2016-17 has been as under:-
EARNINGS |
OUTGO |
||
Rs, In Million |
Rs, In Million |
||
Exports |
15,473.32 |
Imports |
100,786.97 |
Others |
1.02 |
Others |
111.16 |
Total |
15,474.34 |
Total |
100,898.13 |
SUBSIDIARY COMPANY
The wholly owned subsidiary of your Company - MMTC Transnational Pte. Ltd. Singapore (MTPL) incorporated in October 1994 with the objective to take advantage of liberalization/globalization of trade and commerce to tap South East Asian market for trading in commodities has been engaged in commodity trading and has established itself as a credible and reputable trading outfit in Singapore. During the financial year 2016-17 MTPL achieved sales turnover of USD 113.17 million as against US$108.28 million during last fiscal. The Net Profit earned by MTPL during the financial year 201617 amounted to US$ 0.04 million. The net worth of MTPL stood at US$ 15.40 million as on 31st March 2017.
Pursuant to the provisions of Section 129 of the Companies Act, 2013, the audited financial statements of MTPL together with Directorsâ Report & Auditor''s Report are attached herewith.
MMTC''S PROMOTED PROJECT- Neelachal Ispat Nigam Ltd. (NINL)
Your company has set up Neelachal Ispat Nigam Limited (NINL) - an iron & steel plant of 1.1 million tonnes capacity, 0.8 million tonne coke oven and by product unit with captive power plant, jointly with Govt. of Odisha and others. The phase-II of the Project for production of steel, with Basic Oxygen Furnace, Oxygen Plant and SMS has been commissioned and Steel Billets Production was done on trial basis. During the year 2016-17, NINL achieved a turnover of ''12687.3 million, EBDITA of ''14.4 million and incurred net loss of ''3567.44 million. This was primarily due to recession in the economy and steel sector in particular. After lot of persuasion and efforts, finally NINL could sign Iron Ore Mining Lease on captive basis with Govt. of Odisha for 874.24 hectare having 92 million tonne of mineable reserves in the State of Odisha. Mines are expected to commission iron ore production by June, 2018. NINL has also signed MOU with NALCO for setting up of Coal Tar Pitch Plant. With the stabilization of steel making facility and starting of iron ore mining by end of current financial year, NINL''s performance is expected to improve financially.
Projects/ Joint Ventures
To take advantage of new opportunities emerging in the free market environment, your company has promoted a number of joint ventures following the public-private partnership model in earlier years. A brief on the current status of such JVs is given hereunder:
(i) The joint venture for medallion manufacturing unit participated as 26% equity partner in collaboration with PAMP Switzerland in the name of MMTC-PAMP India Pvt. Ltd. achieved a turnover of ''243901.61 millions and profit after tax of ''149.29 million during 2016-17. MMTC has received a dividend of 20% for its investment in MMTC-PAMP India Pvt. Ltd. for FY 2016-17. MMTC-PAMP became Indiaâs first LBMA accredited refiner for Gold and silver. During 2016-17 MMTC has sold Gold Bars produced by MPIPL in the domestic market achieving a turnover of ''7922.2 million.
(ii) A 15 MW capacity Wind Mill project with 25 Wind Energy Generators commissioned by MMTC way back in March, 2007 at Gajendragad in Karnataka, is running successfully and has contributed to the development of the area by meeting some portion of energy needs of Karnataka state. The power generated from the project is sold to HESCOM. The turnover of the project during 2016-17 was '' 77.3 million with a profit of '' 68.6 million.
(iii) To facilitate promotion of two-way trade, the SPV promoted by your Company in association with IL&FS IIDC has been allotted land to set up International Cargo hub at Haldia and Free Trade and Warehousing Zone at Kandla on lines similar to Special Economic Zone. Two plots of 2.75 acres of land in the Kandla FTWZ has been leased in March, 2016 and the annual revenue is ''5.39 million. Discussions are on with the other units for leasing out the plots. The Development Commissioner had granted approval for setting up a unit within Kandla FTWZ.
(iv) Your company had participated in the equity of Currency Futures Exchange under the name and style of "United Stock Exchange of India Ltd which has been merged with âBSE Limitedâ (BSE) during the year and as a result your Company holds 38,961 equity shares of Rs, 2/- each in BSE. During the year BSE earned a net profit of Rs,1986.4 millions against Rs,1328.6 millions in 2015-16 and declared an interim dividend of Rs,5/- on equity share of Rs, 2/- each. The shares of BSE has since been listed on National Stock Exchange (NSE).
(v) Your Company holds 9.55% equity capital in Indian Commodity Exchange Limited (ICEX) as on 31.3.2017 out of total paid up capital of Rs,1675 millions subsequent to the Rights Issue by ICEX(Rs,850 millions) in which MMTC has not participated. During the year ICEX has reported a net loss of Rs,148.5 million for the year 2016-17. ICEX has got necessary approval from SEBI for launching diamond contracts apart from obtaining âin principleâ approval for trading in contracts for Brent Crude and WTI Crude. It has since got clearance from SEBI for restarting its trading operations.
(vi) The JV Company - M/s. SICAL Iron Ore Terminals Limited (SIOTL) could not commence commercial operations due to non-availability of iron ore for exports from Bellary-Hospet Sector in Karnataka State. In view of uncertain future of iron ore exports and to utilize the infrastructure created, Kamarajar Port Trust (erstwhile Ennore Port Trust) decided to award the facility through bidding process for modification of the facility to also handle coal. SIOTL emerged successful to bag the project during such process. As coal does not have synergy with MMTCâs existing line of business, MMTC Board has decided to exit from the JV, process for which is in progress.
(vii) For effective marketing of the finished products of both medallions and jewellery, your company has set up a JV Company, in partnership with a leading Indian company under the name and style of MMTC Gitanjali Limited for setting up retail stores at various cities in India. MMTC Gitanjali Limited has reported a turnover of Rs,266.24 million for the year 2016-17 as against turnover of Rs,283.24 million during 2015-16 and net loss of Rs,24.8 million for the year 2016-17.
(viii) TM Mining Company Ltd.-your companyâs JV with M/s TATA Steel Ltd. for mining, exploration and allied activities has obtained certificate for commencement of operations. Efforts are on by the JV company to identify suitable projects to work on.
INDUSTRIAL RELATIONS & HUMAN RESOURCE MANAGEMENT
Cordial and harmonious industrial relations were maintained in the Company during the year. No man days were lost due to any industrial unrest during the year. Regular meetings were held with the Federation/ Unions / Associations of Officers, Staff and SC/ST Employees under Joint Consultative Machinery Forum. The aim of these meetings is to promote exchange of information/ideas with a view to achieve Companyâs goals and objectives.
The aggregate manpower of the company as on 31st March, 2017 stood at 1225, comprising of 5 Board level executives, 1 CVO, 469 Officers and 639 staff. This manpower includes 6 officers, 105 staff / workers of erstwhile Mica Trading Company Ltd., which had been merged with your company pursuant to the orders of BIFR. The composite representation of the total manpower is - women employees representing 21.06% (258 employees) of the total manpower; SC, ST, OBC & persons with disabilities (PWD) to the extent of 20.89% (256 employees), 9.14% (112 employees), 9.39% (115 employees) and 1.96% (24 employees) respectively. During the year 08 officers were inducted through open advertisement.
RESERVATION POLICY
Policy for reservations for SCs, STs, OBCs and PWD in services was followed fully as per the government guidelines in recruitment and promotion.
TRAINING AND DEVELOPMENT
For further enhancing / upgrading the skills of employees in the constantly changing business scenario, 556 employees were imparted training during the year in different spheres of companyâs activities. This was done through programmes organized in association with in-house faculty as well as external resource persons from renowned institutions/organizations. The employees deputed for training had adequate representation of SC, ST and women employees (SC- 71, ST- 33 and women -162). In terms of man days, such training works out to 745 training man days during the year 2016-17.
IMPLEMENTATION OF OFFICIAL LANGUAGE
The Company is committed to implement Official Language Policy of the Government of India. Best efforts were made to achieve the targets prescribed in the Annual Programme for the year 2016-17 issued by the Department of Official Language, Ministry of Home Affairs, Govt. of India. To promote the usage of Hindi in Company''s day-to-day work, several programmes viz. Hindi Workshops/Hindi Typing, training on Computers/Hindi Day/Week/Fortnight were organized at Corporate Office and Regional Offices during the year. This has brought positive results and a considerable increase of use of Hindi was observed in day to day official work.
During the year the Honâble Committee of Parliament on Official Language inspected our Regional Office at Mumbai and Jaipur for reviewing the progress of implementation of Hindi. The Companyâs Corporate Office and Sub Regional Office Bangalore were awarded with Vishesh Prashansa Purasakar and First Prize respectively by Town Official Language Implementation Committee(PSUs), Delhi and Town Official Language Implementation Committee, Bangalore for the outstanding work done in the area of Official Language implementation.
VIGILANCE
The Vigilance Wing of your Company continued its focus on preventive vigilance to foster the goodwill & confidence stemming from value based business practices and for strengthening the Company as a professionally managed, globally competitive & internationally reputed organization. With the initiatives of Vigilance Division of your Company, various drills/manuals have been prepared and implemented. Under the new initiatives through video conference, quick redressal of problem and issues at regional level was introduced. Vigilance Division is also instrumental in overhauling of
Systems and Procedures to detect and deal with the system failures and effective observance of conduct rules. During the year, the vigilance division processed 18 complaints (13 were carried over from last year and there were 5 new complaints). Out of these, 9 complaints have been disposed of and action on remaining 9 complaints is in progress, and two new vigilance cases were registered. Division is also instrumental in organizing âVigilance Awareness Weekâ in various offices of MMTC from 31.10.2016 to 5.11.2016 with the theme of âPublic participation in promoting integrity and eradication of corruptionâ. Training to Vigilance and Non-Vigilance Officers has been imparted on zonal basis for sensitizing the employees about the preventive vigilance aspect.
VIGIL MECHANISM
In accordance with the provisions of Section 177 of Companies Act 2013, the Board of your company introduced a Scheme on âVigil Mechanismâ in 2014. The vigil mechanism is established for Directors and employees to report their genuine concerns. The concerns, if any, from any employee/Director shall be addressed to the Chairman of the Audit Committee. This mechanism is apart from the Whistle Blower Policy, already in force. During the year under review, no complaint has been received either under the Vigil Mechanism or under the provisions of Whistle Blower Policy. Further, it is affirmed that no person was restrained from accessing the Chairman of Audit Committee.
INTEGRITY PACT
Integrity Pact is promoted as part of series of steps taken by Central Vigilance Commission for ensuring transparency, equity and competitiveness in public procurement. Your Company has also implemented the same to promote transparency/equity amongst the bidders and to plug any possibility of corrupt practices in trade conducted by the Company. Shri D.R.S. Chaudhary IAS (Retd.), has been appointed to function as Independent External Monitors (IEM).
CORPORATE SOCIAL RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT
MMTCâs CSR Policy is in line with Section 135 of the Companies Act and the CSR Rules as notified by the Ministry of Corporate Affairs. The CSR Projects are being undertaken in terms of Section 135 of the Companies Act. The new CSR Policy is hosted on MMTCâs website.
In compliance to CSR Rules, your Company in its endeavor to continue it commitment towards CSR & Sustainability initiatives during the year 2016-17 a sum of ''8.14 million was allocated for undertaking the CSR activities which was equivalent to 2% of the average net profit of preceding three years.
The funds allocated during 2016-17 under CSR were spent towards activities majorly related to the Swachh Bharat Abhiyan, Clean Ganga Mission, Skill India Mission, Promotion of healthcare and Yoga and Promotion of sports/para-sports. Besides this, MMTC supported distribution of artificial limbs and assistive devices to the differently abled. The annual report on CSR activity undertaken by your Company during 201617 is annexed to this Report.
CORPORATE GOVERNANCE
Your Company reposes its firm faith in continuous development, adoption and dedication towards the best corporate governance practices. Towards this end, the norms prescribed under the Companies Act, 2013, SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015(Listing Regulations) and Guidelines applicable for CPSEs issued by the Department of Public Enterprises in this regard are being implemented in letter and spirit. However, appointment of woman director on the Board of the company including two Independent Directors as required on 31.3.2017 is yet to be made by the Government.
A separate Report on Corporate Governance along with certificate from M/s Blak & Co.(CP No.11714) regarding compliance of the stipulations relating to corporate governance specified in Listing Regulations is annexed hereto and forms part of this report. It may be mentioned that the company has complied with the CG norms prescribed by the Department of Public Enterprises applicable for CPSEs and a quarterly reports in this regard are sent regularly.
CODE OF CONDUCT
Pursuant to Regulation 15(5) of Listing Regulations, the Code of Conduct applicable to the Board members & senior management personnel has been posted on the website of your company. All Board Members and Senior Management Personnel as on 31st March, 2017 to whom the said Code is applicable, except one suspended Director(Marketing), have affirmed compliance of the same for the period ended 31st March, 2017. Based on the affirmation received from Board Members and Senior Management Personnel, declaration regarding compliance of Code of Conduct made by the Chairman & Managing Director is given below:
Declaration as required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and DPEâs Guidelines on Corporate Governance
âAll the members of the Board and Senior Management Personnel except one Director(Marketing) have affirmed compliance of the âCode of Business Conduct & Ethics for Board Members and Senior Management Personnelâ of the company for the financial year ended on March 31, 2017.â
BUSINESS RESPONSIBILITY REPORT
In accordance with the provisions of regulation 34(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has prepared the Business Responsibility Report for inclusion in the Annual Report for the year 2016-17. The framework and principles suggested by SEBI to assess compliance with environment, social and governance norms pertaining to Corporate Social Responsibility and Sustainable Development activities of the Company. The Business Responsibility Report of your Company is annexed herewith and forms part of the Annual Report.
PPP for MSEs
In pursuance of Public Procurement Policy (PPP) for Micro and Small Enterprises (MSEs), in its endeavor, MMTC have been making efforts to procure goods and services from MSEs equivalent to 20% of the value of its annual requirement. Out of 20%, 4% of items are to be procured from the entrepreneurs belonging to the category of SCs and STs.
During 2016-17, MMTC in respect of its administrative requirements, procured goods and services (which mainly include office equipments, stationery items, office maintenance, housekeeping & security services etc.) has procured 58.26% (Rs.46.8 million) from annual procurement of Rs,81.8 millions and Rs,5.1 millions from MSEs owned by SC/ST entrepreneurs which is 31.19% against a sub-target of 4% out of 20% MSE target of annual procurement, earmarked for procuring from MSEs owned by SC/ST entrepreneurs.
During 2017-18, MMTC, in respect of administrative requirements, intends to procure goods and services amounting to Rs,80 millions ( /-10%) (approx.) In compliance of Public Procurement Policy for Micro & Small Enterprises.
PUBLIC DEPOSIT SCHEME
As on 1st April 2017, there were no outstanding public deposits and the company did not invite/ accept any public deposit during the year ended 31st March, 2017.
ANNUAL RETURN
The extracts of Annual Return pursuant to provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is furnished in prescribed form-MGT-9 and the same is annexed herewith.
STATUTORY AUDITORâS REPORT
The report of Statutory Auditors for the year 2016-17 along with Management''s reply to the observations of the Statutory Auditors is annexed herewith.
COMMENTS OF COMPTROLLER & AUDITOR GENERAL OF INDIA
The Comptroller & Auditor General of India (C&AG) has given âNilâ comments under section 143 (6) (b) of the Companies Act, 2013 on the accounts of the Company for the year ended 31.03.2017. The communication dated 25.07.2017 of C&AG of India in this regard is annexed herewith.
SECRETARIAL AUDIT
Pursuant to provisions of Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, your Company engaged the services of M/s. Blak & Co., Practicing Company Secretaries, New Delhi to conduct the Secretarial Audit of the Company for the financial year ended March 31, 2017. The Secretarial Audit Report (in Form MR-3) along with Managementâs Reply on the observations of the Secretarial Auditor is annexed herewith.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013
Details of investments, loans and guarantees covered under the provisions of Section 186 of the Companies Act, 2013 are given in Note 8,10,13 and 36 respectively of the Notes forming part of the financial statements. The company has extended working capital credit facilities limit of Rs,14050 millions during the financial year 2016-17 (reduced to Rs,13450 millions as on 31.3.2017) to meet the day to day operational activities of the JV company - M/s Neelachal Ispat Nigam Limited in accordance with provisions of Section 186 of Companies Act 2013 duly approved by the Board out of which the total outstanding as on 31.3.2017 is Rs, 13274.8 millions.
RELATED PARTY TRANSACTIONS
All transactions entered by the Company with Related Parties were in the Ordinary Course of Business and not at Armâs Length basis. The Audit Committee granted omnibus approval for the transactions undertaken during 2016-17. The approval of the Board and Shareholders at the AGM for such Related Party Transactions were taken. Suitable disclosures as required under Ind AS-24 have been made in Note 44 of Notes to the financial statements. Details of the transaction are provided in Form AOC-2 which is annexed herewith.
The Policy on Related Party Transactions as approved by the Board of Directors has been uploaded on the Companyâs website at the following link: http: // mmtclimited.com/files/.pdf/95_party_policy.pdf
RISK MANAGEMENT POLICY
The Board of Directors approved the Risk Management Policy after the same has been duly recommended by the Audit Committee of Directors to take care of various risks associated with the business undertaken by your company. The details of Risk
Management as practiced by the Company is provided as part of Management Discussion and Analysis Report which is annexed herewith.
CONSERVATION OF ENERGY
During the year 2016-17, there was no production activity in (Mica group) of your company. Hence, the provisions of Rule 8(3) of Companies (Accounts) Rules, 2014, are not applicable.
PARTICULARS OF EMPLOYEES
Pursuant to provisions of Rule 5(2) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, as amended from time to time, it is stated that there were no employees who were in receipt of remuneration exceeding Rs,60 lakhs per annum or Rs, 5.00 lakhs per month during the year 2016-17.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134(5) of the Companies Act, 2013, your Directors state that:
a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
b) the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for the year ended 31.3.2017;
c) the Directors have taken a 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;
d) the Directors had prepared the annual accounts on a going concern basis.
e) the directors of your company had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and
f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013
The Company has in place a Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. An Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment at work place. All employees (permanent, contractual, temporary, trainees) are covered under this policy.
No complaints were received by the Company under the above Act during the year under review.
BOARD OF DIRECTORS
Following are the changes in the Board of Directors of your company since 1st April 2016: -
Name of the Director |
Category |
Date of Appointment / Cessation |
Appointment/ Cessation |
Mr. Rana Som |
Non-official (Independent) Director |
09.04.2016 |
Cessation |
Mr. N.Bala Baskar |
Non-official (Independent) Director |
09.04.2016 |
Cessation |
Dr. Subas Pani |
Non-official (Independent) Director |
09.04.2016 |
Cessation |
Mr. S.R.Tayal |
Non-official (Independent) Director |
09.04.2016 |
Cessation |
Mr. R.Anand |
Non-official (Independent) Director |
15.06.2016 |
Appointment |
Mr. B.K. Shukla |
Non-official (Independent) Director |
04.07.2016 |
Appointment |
Mr. M.G. Gupta |
Director(Finance) |
08.12.2016 |
Cessation |
Mr. Rajeev Jaideva |
Director(Personnel) |
31.12.2016 |
Cessation |
Mr. A.K. Bhalla |
Govt. Nominee Director |
02.11.2016 |
Cessation |
Dr. Inder Jit Singh |
Govt. Nominee Director |
02.11.2016 |
Appointment |
Mr. T.K. Sengupta |
Director(Personnel) |
02.01.2017 |
Appointment |
Mr. Rajnish Goenka |
Non-official (Independent) Director |
27.01.2017 |
Appointment |
Dr.Jayant Dasgupta |
Non-official (Independent) Director |
07.02.2017 |
Appointment |
Mr. R.R.Jadeja |
Non-official (Independent) Director |
11.02.2017 |
Appointment |
Mr Anand Trivedi |
Director(Marketing) |
02.7.2017 |
Cessation |
The Board places on record its deep appreciation for the commendable services and the contributions made by the Directors who ceased to be on the Board w.e.f. 1.4.2016 onwards. The Board also welcomes S/Sh.. R. Anand, Balkrishna K. Shukla, Dr. Inder Jit Singh, T.K. Sengupta, Rajnish Goenka, Dr. Jayant Dasgupta and R.R. Jadeja and expresses its confidence that the Company shall immensely benefit from their rich and varied experience.
During the year two whole time directors - Shri M G Gupta and Shri Anand Trivedi were placed under suspension on 7.11.2016 & 6.12.2016 respectively by the administrative ministry.
In terms of provisions of Article 87(4)(A) of Articles of Association of the Company regarding rotational retirement of Directors, Shri P.K. Jain, Director(Marketing) shall retire at the AGM and, being eligible, has offered himself for reappointment.
ACKNOWLEDGEMENTS
Your Directors would like to acknowledge and place on record their sincere appreciation of all stakeholders- Shareholders, Department of Commerce, all Govt. Agencies, RBI and other Banks, Railways, Customs, Ports, Customers, Suppliers and other business partners for the excellent support and cooperation received from them during the year. Your Directors also recognize and appreciate the efforts and hard work of all the employees of the Company and their continued contribution towards its progress.
By the Order of the Board
sd/-
( Ved Prakash )
Chairman & Managing Director
DIN No: 02988628
Dated: 09.8.2017
Mar 31, 2015
To The Members of MMTC Limited, New Delhi.
Ladies & Gentlemen,
On behalf of Board of Directors, I have pleasure in presenting 52nd
Annual Report on the performance of your company for the financial year
ended 31st March 2015 along with audited statements of accounts and
Statutory Auditor's Report.
RESULTS OF OPERATIONS
Your company, one of the leading trading companies in India, recorded a
business turnover of Rs.182,415.04 million (including sale of services
Rs.46.20 million) during 2014-15 as against the business turnover of
Rs.250,744.94 million registered during last fiscal. This business
turnover includes Exports of Rs.23007.00 million, Imports of Rs.
145301.50 million and domestic trade of Rs.14065.90 million. The other
trade related earnings contributed Rs.427.78 million. The trading
profit earned by your Company stood at Rs.2079.12 million as against
Rs.3455.79 million during last fiscal. The Company has reported Profit
After Tax of Rs.479.10 million in the current fiscal compared to
Rs.186.42 million earned last year.
The highlights of the Company's performance during 2014-15 are as
below:- (Rs ln Millions)
2014-15 2013-14
Sale of Products 182,374.40 250,706.69
Sale of Services 46.20 39.62
Other Trade Earnings 427.78 1,950.15
Less : Excise Duty 5.56 1.37
Total Revenue from Operations 182,842.82 252,695.09
Cost of Sales 180,763.70 249,239.30
Trading Profit 2,079.12 3,455.79
Add: Dividend and other Income 252.05 845.88
Less: Establishment & Administrative 2,053.66 2,597.39
Overheads, and exceptional items etc
Less: Debts/Claims Written off 299.96 10.74
Less: Provisions for Doubtful Debts/ 12.36 12.74
Claims / Advances / Investments
Profit Before Interest,
Dep., Prior Period & (34.81) 1,680.80
Taxes
Add: Interest Earned (Net)(Interest
earned 827.65 707.59
minus Finance cost)
Profit Before Pep., Prior
Period & Taxes 792.84 2,388.39
Less: Depreciation 178.17 124.22
Less: Prior Period Expenses 15.99 15.17
Profit Before extra ordinary
items and 598.68 2,249.00
Taxes
Less: Extraordinary item - 2,104.42
Less: Provision for Current Taxes 136.99 765.48
Less: Provision for Deferred Taxes (17.41) (807.32)
Profit After Taxes 479.10 186.42
Add: Balance brought forward from the 6,448.82 6,444.49
previous year
Balance
Which the Board has appropriated
as under to:
(I) Proposed Dividend 250.00 150.00
(II) Dividend Tax 50.89 25.49
(III) General reserve 100.00 9.40
(IV) Opening Adjustment of Depreciation 4.97 -
(V) Sustainable Development Reserve - (2.11)
(VI) Corporate Social Responsibility
Reserve - (4.23)
(VII) Research and Development
Reserve - 3.54
Leaving a balance to be carried
forward 6,522.06 6,448.82
The performance of different business groups of your Company is
highlighted in the Management Discussion and Analysis Report, which is
annexed and forms part of this Report.
EQUITYSHARE CAPITALS DIVIDEND
The Board of Directors recommends declaration of dividend @25% on the
equity capital of Rs 1,000 million of the Company for the year 2014-15
out of profits of the Company.
RESERVES
Asum of Rs.12418.70 million was available in the reserves and surplus
of your Company as on 1st April, 2014. Your Directors have proposed
that Dividend at the rate of 25% be paid out of profits of the Company.
Accordingly, an amount of Rs. 12591.95 million was available in
"Reserves and Surplus" of your Company as on 31st March, 2015.
FOREIGN EXCHANGE EARNINGS AND OUTGO
The Foreign Exchange earnings and outgo of your Company during 2014-15
has been as under:-
EARNINGS OUTGO
Rs. In Million Rs. In Million
Exports 22,937.86 Imports 137,267.75
Others 58.99 Interest 2.60
Others 814.86
Total 22,996.85 Total 138,085.21
SUBSIDIARY COMPANY
The wholly owned subsidiary of your Company - MMTC Transnational Pte.
Ltd., Singapore (MTPL) was incorporated in October 1994 under the laws
of Singapore with a share capital of US$ 1 million. During the year
2014-15, MTPL achieved business turnover of US$ 248.02 million as
against US$369.46 million during last fiscal. The Profit After Tax
earned by MTPL during 2014-15 amounted to US$ 0.13 million. The net
worth of MTPL stood at US$ 15.64 million as on 31 st March 2015 as
against net worth of US$ 15.51 million as on 31.03.2014.
MTPL enjoyed prestigious "Global Trader Programme" (GTP) status awarded
to it by International Enterprise, Singapore, an arm of the Govt.
ofSingaporefromtheyear2000to2013.
Pursuant to the provisions of Section 129 of the Companies Act, 2013,
the audited financial statements of MTPL together with Director's
Report &Auditor's Reportare attached herewith.
MMTC'S PROMOTED PROJECT-Neelachal Ispat Nigam Ltd. (NINL)
Your company has set up Neelachal Ispat Nigam Limited (NINL)-an iron &
steel plant of 1.1 million tonnes capacity, 0.8 million tonne coke oven
and by product unit with captive power plant, jointly with Govt, of
Odisha and others. The project has been granted Iron ore mining lease
with an estimated reserves of 110 million tonnes. The phase-ll of the
Project for production of steel, with Basic Oxygen Furnace, Oxygen
Plant and SMS got commissioned in March 2013 and Steel Billets
Production also started. During the year 2014-15, NINL achieved a sales
turnover of Rs. 13156 million and loss of Rs.2327 million due to
recession in the economy and steel sector in particular. With the
stabilization of steel making facility and starting of iron ore mining
by end of this financial year, NINL's performance is expected to
improve substantially.
PROJECTS/JOINT VENTURES
To evolve a new business model for taking advantage of new
opportunities emerging in the free market environment, your company has
promoted a number of joint ventures following the public- private
partnership route in earlier years. A brief on the current status of
such JVs is given hereunder:
(i) M/s Indian Commodity Exchange Limited in which MMTC has a stake of
26% of the total paid up capital of Rs.100 crores has reported a net
loss of Rs.81.56 million for the year 2014-15 as against a net loss of
Rs.89.84 million during 2013-14.
(ii) The JV Company - Currency Futures Exchange under the name and
style of "United Stock Exchange of India Ltd in which MMTC has invested
an amount of Rs.30 million. The said JV Company is in the process of
merger with BSE Ltd as per the approval of SEBI, CCI and shareholders
of the exchange. The merger of United Stock Exchange with BSE was
approved by the Hon'ble High Court of Bombay which will be effective
from the date the order is filed with ROC.
(iii) The joint venture for medallion manufacturing unit in
collaboration with PAMP Switzerland in the name of MMTC- PAMP India
Pvt. Ltd. achieved a turnover of Rs.220639.73 million and reported a
net profit of Rs. 1124.72 million for the year 2014-15 and has declared
70% dividend on the paid up capital. During the year, MMTC-PAMP became
India's first LBMA accredited refiner for Gold and Silver.
(iv) For effective marketing of the finished products of both
medallions and jewellery, your company has set up a JV Company, in
partnership with a leading Indian company under the name and style of
MMTC Gitanjali Limited for setting up retail stores at various cities
in India. MMTC Gitanjali Limited has reported a turnover of Rs. 111.96
million and net loss of Rs.9.70 million for the year 2014-15 as against
net loss of Rs.7.86 million during 2013-14.
(v) The JV Company - M/s. SICAL Iron Ore Terminals Limited (SIOTL)
could not make any progress during 2014-15 due to non-availability of
iron ore for exports from Bellary-Hospet Sector in Karnataka State. The
JV company has been pursuing with Kamarajar Port Limited(KPL) for
permission to convert this facility for handling discharge of coal
imports instead of iron ore exports, so as to meet growing demand of
thermal power plants in Tamil Nadu. Ministry of Surface Transport,
Govt, of India have agreed to the proposal of KPL and KPL has already
issued tender for selection of operator with first right of refusal to
SICAL.
(vi) M/s Blue Water Iron Ore Terminal Private Ltd, one of the other
joint ventures of your Company could not commence operation. The JV
Company is being wound up.
(vii) TM Mining Company Ltd.-your company's JV with M/s TATA Steel Ltd.
for mining, exploration and allied activities has obtained certificate
for commencement of operations. Efforts are on to identify suitable
projects to operationalise.
(viii) To facilitate promotion of two-way trade, the SPV promoted by
your Company in association with IL&FS has been allotted land to setup
International Cargo hub at Haldia and Free Trade and Warehousing Zone
at Kandla on lines similar to Special Economic Zone. The SPV promoted
by MMTC jointly with ILFC IDC Fund has been allotted 75 acres of land
at Kandla for development of Phase-1 of Kandla FTWZ Project which is
currently in progress. 200 acres of land have also been allotted to the
SPV at Haldia to set up an International Cargo Hub outside the purview
of SEZAct, as per State Government policy. Part construction of
Compound Wall to secure physical possession of the land for the Haldia
project has been started. Work Orders for preparation of Business Plan
and architectural Master Plan for the Haldia Project have been issued
to the selected bidders. Development work at Kandla has also been
started.
(ix) Your Company has set up a 15 MW Wind Mill Project with 25 Wind
Energy Generators(WEGs) of 600 KVAeach which was commissioned in March,
2007 by MMTC through M/s.RRB Energy Ltd. Sale of power from the project
till 31.3.2015 amount to Rs.70 crores. Full return of capital on 'real
cash receipt basis' has been achieved in February, 2015.The project is
connected to 110/33 KV Grid at Gajendragad Sub-station controlled by
Karnataka State owned Enterprise i.e. M/s. Hubli Electricity Supply
Company Ltd. (HESCOM).The project is running successfully for the last
8 years and has contributed to the development of the area by meeting
some portion of the energy needs of Karnataka State.
INDUSTRIAL RELATIONS & HUMAN RESOURCE MANAGEMENT
Cordial and harmonious industrial relations continued to prevail in
your company with no man-days lost during the year. Regular meetings
were held with the Unions /Associations/ Federation for attaining an
amicable resolution of HR related issues to achieve Company's goals and
objectives.
The aggregate manpower of the company as on 31st March, 2015 stood at
1439, excluding Board level executives, comprising of 542 Officers and
897 staff. This includes 8 officers, 112 staff / workers of erstwhile
Mica Trading Company Ltd., which had been merged with your company
pursuant to the orders of BIFR. While the composite representation of
the total manpower consisted of women employees representing 20.92%
(301 employees) of the total manpower, the representation of SC, ST,
OBC & persons with disabilities (PWD) was to the extent of 21.26% (306
employees), 8.89% (128 employees), 8.61% (124 employees) and 2.29% (33
employees) respectively. During the year 16 officers were inducted
through campus recruitment and open advertisement. Policy for
reservations for SCs, STs, OBCs and PWD in services was followed fully
in recruitment and promotion.
With the objective of further enhancing / upgrading the skills of
employees in the constantly changing business scenario, 1057 employees
were imparted training during the year in different spheres of
company's activities. This was done through programmes organized both
with in-house expertise as well as external resources from renowned
institutions / organizations. The employees deputed for training
included 166 employees belonging to SC, 79 to ST and 302 women
employees. In terms of man-days such training works out to 2070
training man-days during the year 2014-15.
During the year an understanding was reached between MMTC and
IIM-Ahmedabad that MMTC would depute senior officers for "Advanced
Leadership" program once a year. In December 2014, 35 senior officers
of MMTC underwent Advanced Leadership Training at the IIM-Ahmedabad.
Out of 35 officers, 7 belonged to SC and 3 belonged to ST, which
amounts to 28.57%.
IMPLEMENTATION OF OFFICIAL LANGUAGE
Your Company is committed to implement Official Language Policy of the
Government. During the year 2014-15 your company consistently strived
to adhere and implement the Official Language Policy to meet the
targets given in the annual programme issued by the Department of
Official Language, Ministry of Home Affairs, Govt, of India. To promote
usage of the Official Language by employees of the company, several
programs in the form of Hindi Workshops, Hindi Seminars, Hindi
Day/Week/Fortnight were organized at the Corporate Office and Regional
Offices during the year under review.
Hon'ble Parliamentary Committee on Official Languages inspected your
company's Mumbai Regional Office and Bengaluru Regional Offices. During
the year, the Company was awarded Rajbhasha Trophy for excellence in
implementation of Official Language Policy in the Company by Ministry
of Commerce.
VIGILANCE
Continuing to foster the goodwill & confidence stemming from value
based business practices and strengthening the Company as a
professionally managed, globally competitive & internationally reputed
organization, the vigilance group of your company carried further its
focus on preventive vigilance. With the efforts of Vigilance Division
of your Company, a comprehensive Finance and Accounts Manual as well as
a standardized Business Manual, Corporate Risk Management Policy have
been prepared and circulated for implementation. During the period
under review, Vigilance Division processed 38 complaints (18 were
carried forward from last year and 20 new complaints have been added to
the tally) out of which 27 complaints have been disposed of and action
on the remaining 11 complaints is in progress. Scrutiny of Annual
property returns for the calendar year 2014 from MMTC employees have
been done.
During the year under report Vigilance group of your Company was also
instrumental in organizing "Vigilance Awareness Week" in various
offices of MMTC from 27.10.2014 to 01.11.2014. The theme for the week
was "Combating Corruption - Technology as an enabler".
New initiatives undertaken by Vigilance Division include vigilance
training and skill up gradation to vigilance & non- vigilance officers
on zonal basis for sensitizing employees about the preventive vigilance
aspect, ERP system up- gradation work for plugging the gaps in existing
ERP Module, installation of voice recording in the cabin of Head of
Finance for recording forex fixings, installation of video camera in
premises where gold/silver is delivered, strengthening of KYC norms,
and introduction of multi-layer system of audit.
VIGIL MECHANISM
In accordance with the provisions of Section 179 of Companies Act 2013,
the Board of your company introduced a Scheme on 'Vigil Mechanism' in
compliance with the directions of Audit Committee of Directors. This
Audit Committee Vigil Mechanism is established for Directors and
employees to report their genuine concerns. The scheme has been
notified vide Circular dated 14th August 2014. The concerns if any from
any employee/Director shall be addressed by the Chairman of the Audit
Committee. During the year under review, no such complaint has been
received.
INTEGRITY PACT
Integrity Pact has been implemented to promote transparency/equity
amongst the bidders so as to plug possibility of corrupt practices in
trade conducted in the Company. Integrity Pact is being implemented as
part of series of steps taken by Central Vigilance Commission for
ensuring transparency, equity and competitiveness in public
procurement. Shri Bijoy Chatterjee, IAS (Retd.) & Shri DRS Chaudhary
IAS (Retd.), have been appointed to function as Independent External
Monitors (IEM).
CORPORATE SOCIAL RESPONSIBILITYAND SUSTAINABLE DEVELOPMENT
As a responsible corporate body, your Company has always been committed
to discharge its social responsibility in the best possible way.
Various initiatives have been taken for the benefit of society and the
environment since 2006-07. With a view to address the CSR issues, your
Company had revised its Corporate Social Responsibility Policy in line
with the Guidelines issued by Department of Public Enterprises, Govt,
of India and in accordance with the Companies Act, 2013. The average
net profit of the preceding 3 years in case of your Company being
negative, MMTC was statutorily not required to undertake any CSR
initiative during 2014-15. In view that MMTC since 2006 has been
continuously undertaking CSR initiatives, it was decided by the Board
of Directors, to voluntarily make an allocation of Rs.49 lakhs for
undertaking CSR activities during 2014-15, to maintain continuity in
its socially responsible stature.
Your Company is a member of the Global Compact Network, India and apart
from undertaking CSR/SD initiatives in line with the Global Compact
Principles, it also submits its Communication on Progress (COP) to UN
Global Compact every year.
The funds allocated for CSR were utilized for construction of two
public toilets at Haiderpur in North Delhi, which was undertaken in
association with "Sulabh International Social Service Organization",
operation and maintenance of which has been assigned to Sulabh
International. Besides, a small contribution was made towards Clean
Ganga Fund established by the Government of India for the rejuvenation
of River Ganga.
In accordance with the provisions of the Companies Act, 2013 a report
on CSR activities of your Company in the prescribed format is annexed
herewith and forms part of the Annual Report.
CORPORATE GOVERNANCE
Your Company reposes its firm faith in continuous development, adoption
and dedication towards the best corporate governance practices. Towards
this end, the CG norms enshrined under the Companies Act, 2013 as also
the SEBI guidelines in this regard are being implemented in letter and
spirit. However, appointment of women director on the Board of the
Company is yet to be complied with owing to the fact that all the
directors on the board are appointed by the President of India in the
case of CPSEs.
Aseparate report on corporate governance along with certificate from
M/s Blak& Co.(CP No. 11714) regarding compliance of the stipulations
relating to corporate governance specified in clause 49 of the Listing
Agreement(s) signed with stock exchanges is annexed hereto and forms
part of this report.
CODE OF CONDUCT
Pursuant to Clause 49 (I) (D) of the Listing Agreement signed with
Stock Exchanges, a detailed Code of Business Conduct and Ethics for
Board Members and Senior Management Personnel has been laid down and
hosted on the website of your company. All Board Members and Senior
Management Personnel, except one General Manager (under suspension) on
the regular rolls of the Company as on 31 st March, 2015, to whom the
said Code is applicable, have affirmed compliance of the same for the
period ended 31st March, 2015.
BUSINESS RESPONSIBILITY REPORT
In accordance with the directives of SEBI and provisions of Clause 55
of Listing Agreement signed with stock exchanges, based on the list of
top 100 companies given by BSE, your Company has prepared the Business
Responsibility Report for inclusion in the Annual Report for the year
2014-15. The framework and principles suggested by SEBI to assess
compliance with environment, social and governance norms pertain to
Corporate Social Responsibility and Sustainable Development activities
of the Company. The Business Responsibility Report of your Company is
annexed herewith and forms part of the Annual Report.
PUBLIC DEPOSIT SCHEME
As on 1st April 2014, there were no outstanding public deposits and
the company did not invite/ accept any public deposit during the year
ended 31st March, 2015.
DECLARATION OF INDEPENDENT DIRECTORS
The Independent Directors have submitted their disclosures to the Board
that they fulfill all the requirements as stipulated in Section 149(6)
of the Companies Act, 2013 so as to qualify themselves to be appointed
as Independent Directors under the provisions of the Companies Act,
2013 and the relevant rules.
ANNUALRETURN
The extracts of Annual Return pursuant to provisions of Section 92 read
with Rule 12 of the Companies (Management and Administration) Rules,
2014 is furnished in prescribed form-MGT-9 and the same is annexed
herewith.
STATUTORY AUDITOR'S REPORT
The report of Statutory Auditors for the year 2014-15 along with
Management's reply to the observations of the Statutory Auditors is
annexed herewith.
COMMENTS OF COMPTROLLER & AUDITOR GENERAL OF INDIA
The Comptroller & Auditor General of India (C&AG) has given 'NIL'
comments under section 143 (6) (b) of the Companies Act, 2013 on the
accounts of the Company for the year ended 31.03.2015. The
communication dated 22nd July, 2015 of C&AG of India in this regard is
annexed herewith.
SECRETARIAL AUDIT
Pursuant to provisions of Section 204 of the Companies Act, 2013 read
with Rule 9 of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules 2014, your Company engaged the services of
M/s. Black & Company, Practicing Company Secretaries, New Delhi to
conduct the Secretarial Audit of the Company for the financial year
ended March 31,2015. The Secretarial Audit Report (in Form MR-3)
along with Management's Reply on the Observations of the Secretarial
Auditor is annexed herewith.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF
THE COMPANIES ACT, 2013
Details of loans, guarantees and investments covered under the
provisions of Section 186 of the Companies Act, 2013 are given in Note
7.5,6.2 and 19 respectively of the Notes forming part of the financial
statements.
RELATED PARTY TRANSACTIONS
All transactions entered by the Company with Related Parties were in
the Ordinary Course of Business and not at Arm's Length basis. The
Audit Committee granted omnibus approval for the transactions
undertaken during 2014-15. The approval of the Board and Shareholders
through postal ballot for such Related Party Transactions were taken.
Suitable disclosures as required under AS-18 have been made in Sub-Note
25 of No. 20 of the Notes to the financial statements. Details of the
transaction are provided in Form AOC-2 which is annexed herewith.
The Board approved Policy on Related Party Transactions has been
uploaded on the Company's website at the following link:
http://mmtclimited.gov.in/files/.pdf/95_party_policy.pdf
RISK MANAGEMENT POLICY
The Board of Directors approved the Risk Management Policy after the
same has been duly recommended by the Audit Committee of Directors to
take care of various risks associated with the business undertaken by
your company. The details of Risk Management as practiced by the
Company is provided as part of Management Discussion and Analysis
Report, is annexed herewith.
CONSERVATION OF ENERGY
During the year 2014-15, there was no activity in Mica group of your
company. Pursuant to rule 8(3) of Companies (Accounts) Rules, 2014, a
statement on conservation of energy is annexed to this report.
PARTICULARS OF EMPLOYEES
Pursuant to provisions of section 217(2A) of the Companies Act, 1956
read with the Companies (Particulars of Employees) Rules, 1975, as
amended from time to time, it is stated that there were no employees
who were in receipt of remuneration exceeding Rs.60 lakhs per annum or
Rs. 5.00 lakhs per month during the year 2014-15.
DIRECTORS'RESPONSIBILITYSTATEMENT
Pursuant to the provisions of Section 134(5) of the Companies Act,
2013, your Directors state that:
a) in the preparation of the annual accounts, the applicable accounting
standards had been followed along with proper explanation relating to
material departures;
b) the Directors had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the profit and loss
of the Company for the year ended 31.3.2015;
c) the Directors have taken a 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;
d) the Directors had prepared the annual accounts on a going concern
basis.
e) the directors of your company had laid down internal financial
controls to be followed by the company and that such internal financial
controls are adequate and were operating effectively; and
f) the Directors had devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate and operating effectively.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE
(PREVENTION, PHOHIBITION& REDRESSAL) ACT, 2013
The Company has in place an Anti Sexual Harassment Policy in line with
the requirements of The Sexual Harassment of Women at the Workplace
(Prevention, Prohibition & Redressal)Act, 2013. Internal Complaints
Committee (ICC) has been set up to redress complaints received
regarding sexual harassment. All employees (permanent, contractual,
temporary, trainees) are covered under this policy.
The following is a summary of sexual harassment, complaints received
and disposed off during each calendar year:
No. of complaints received : Nil
No. of complaints disposed off : Nil
BOARD OF DIRECTORS
Following are the changes in the Board of Directors of your company
since 1st April 2014: -
Smt. Anita Agnihotri, SS&FA, Department of Commerce, Ministry of
Commerce & Industry relinquished the charge of Part Time Director on
the Board of MMTC on 16th June, 2014.
Shri Bhagwati Prasad Pandey, AS & FA, Department of Commerce, Ministry
of Commerce & Industry took charge of Part Time Director on the Board
of MMTC vice Smt. Anita Agnihotri w.e.f. 16*' June, 2014.
Shri Anil Razdan relinquished the charge of Part Time Non Official
(Independent) Director on 12*'July, 2014.
Shri G.S.Vedi relinquished the charge of Part Time Non Official
(Independent) Director on 13th July, 2014.
Shri Arun Balakrishnan relinquished the charge of Part Time Non
Official (Independent) Director on 15th July, 2014.
Shri Ved Prakash, Director(Mktg) took the additional charge of CMD
w.e.f. 31.12.2014 from Shri D.S. Dhesi who relinquished the charge of
CMD, MMTC on 30.12.2014 consequent upon his demitting the office of
Additional Secretary in Department of Commerce, Ministry of Commerces
Industry.
Shri R.R. Rashmi, Additional Secretary, Department of Commerce took
charge of Part Time Director on the Board of MMTC w.e.f. 24.2.2015 vice
Shri Madhusudan Prasad, Special Secretary, Deptt. Of Commerce.
Shri Ved Prakash assumed the charge of Chairman and Managing Director
of MMTC Ltd on 19.3.2015.
Shri A.K. Bhalla, Additional Secretary, Department of Commerce took
charge of Part Time Director on the Board of MMTC Ltd. w.e.f. 29.4.2015
vice Shri R.R. Rashmi.
Shri Bhagwati Prasad Pandey, AS&FA, Department of Commerce relinquished
the charge of Part Time Director on the Board of MMTC on 6.8.2015.
Shri J.K. Dadoo, Additional Secretary & Financial Advisor, Department
of Commerce took charge of Part Time Director on the Board of MMTC Ltd.
w.e.f. 6.8.2015 vice Shri Bhagwati Prasad Pandey.
The Board places on record its deep appreciation for the commendable
services and the contributions made by Smt. Anita Agnihotri, Shri Anil
Razdan, Shri G.S. Vedi, ShriArun Balakrishanan, Shri Madhusudan Prasad,
Shri D.S. Dhesi, Shri R.R. Rashmi and Shri Bhagwati Prasad Pandey. The
Board also welcomes Shri A.K. Bhallaand Shri J.K. Dadoo and expresses
its confidence that the Company shall immensely benefitfrom their rich
and varied experience.
In terms of provisions of Article 87(4)(A) of Articles of Association
of the Company regarding rotational retirement of Directors, Shri M.G.
Gupta, Director(Finance) and Shri P.K. Jain, Director(Marketing) shall
retire at the AGM and, being eligible, have offered themselves for
reappointment.
ACKNOWLEDGEMENTS
Your Directors would like to acknowledge and place on record their
sincere appreciation of all stakeholders- Shareholders, Department of
Commerce, all Govt. Agencies, RBI and other Banks, Railways, Customs,
Ports, NMDC, Customers, Suppliers and other business partners for the
excellent support and cooperation received from them during the year.
Your Directors also recognize and appreciate the efforts and hard work
of all the employees of the Company and their continued contribution
towards its progress.
By the Order of the Board
sd/-
(Ved Prakash)
Chairman and Managing Director
Dated: 13.8.2015
Mar 31, 2014
The Members
MMTC Limited,
New Delhi.
Ladies & Gentlemen,
On behalf of Board of Directors, I have pleasure in presenting 51st
Annual Report on the performance of your company for the financial year
ended 31st March 2014 along with audited statements of accounts and
Statutory Auditor''s Report.
RESULTS OF OPERATIONS
Your company, one of the leading trading companies in India, recorded a
business turnover of Rs. 250746.31 million during 2013-14 as against
the business turnover of Rs.284156.23 million registered last fiscal.
This business turnover includes Exports of Rs.41270.27 million, Imports
of Rs.187134.51 million and domestic trade of Rs.22341.53 million. The
other trade related earnings contributed Rs.1948.78 million. The
trading profit earned by your Company stood at Rs.3455.79 million as
against Rs.2997.48 million during last fiscal. The Company has reported
Net Profit of Rs.186.42 million in the current fiscal compared to net
loss of Rs.706.24 million during last year.
The highlights of the Company''s performance during 2013-14 are as
below: -
(Rs in Millions)
2013-14 2012-13
Sales 250,746.31 284,156.23
Other Trade Earnings 1948.78 1827.36
Total Revenue from Operations 252,695.09 285,983.59
Cost of Sales 249,239.30 282,986.11
Trading Profit 3,455.79 2,997.48
Add: Dividend and other Income 845.88 382.58
Less: Establishment & Administrative
Overheads, and 2,597.39 2639.80
exceptional items etc
Less: Debts/Claims Written off 10.74 0.70
Less: Provisions for Doubtful Debts/ 12.74 62.53
Claims/Advances/Investments
Profit Before Interest, Dep., Prior
Period & Taxes 1,680.80 677.03
Add: Interest Earned (Net)(Interest
earned minus 707.59 601.81
Finance cost)
Profit Before Dep., Prior Period & Taxes 2,388.39 1278.84
Less: Depreciation 124.22 119.70
Less: Prior Period Expenes 15.17 (6.12)
Profit Before extra ordinary items
and Taxes 2,249.00 1165.26
Less: Extraordinary item 2,104.42 2,443.64
Less: Provision for Current Taxes 765.48 167.14
Less: Provision for Deferred Taxes (807.32) (739.28)
Profit After Taxes 186.42 (706.24)
Add: Balance brought forward from the
previous year 6,444.49 7,257.19
Balance Which the Board has appropriated
as under to:
(I) Proposed Dividend 150.00 100.00
(II) Dividend Tax 25.49 -
(III) General reserve 9.40 -
(IV) Sustainable Development Reserve (2.11) 2.11
(V) Corporate Social Responsibility Reserve (4.23) 4.36
(VI)Research and Development Reserve 3.54 -
Leaving a balance to be carried forward 6,448.82 6,444.48
The performance of different business groups of your Company is
highlighted in the Management Discussion and Analysis Report, which is
annexed and forms part of this Report.
AWARDS & RANKINGS
Following Awards and Rankings were conferred on your Company during
2013-14:
- CAPEXIL''s Highest Export Award for the year 2011-12 for its export
achievement in respect of Canalized Agency(Minerals & Ores Sector) -
21st time in a row.
- Certificate of Excellence from the Directorate of Export Promotion
and Marketing, Government of Odisha for outstanding performance in the
export of Pig Iron under Metallurgy group and in the Export of Iron
ore, Chrome Ore & Concentrate under Minerals Group for the year
2010-11.
- Rajbhasha Trophy for FY 2013-14 by Ministry of Commerce. Second prize
for excellence in implementation of Official Language Policy
EQUITY SHARE CAPITAL & DIVIDEND
The Board of Directors recommends declaration of dividend @15% on the
equity capital of Rs 1,000 million of the Company for the year 2013-14
out of profits of the Company.
OFFER FOR SALE TO EMPLOYEES
In terms of CCEA''s approval dated 14.9.2012 and Department of
Disinvestment''s Communication dated 10.10.2013 and 24.3.2014, Offer for
Sale of MMTC''s Equity Shares by Government of India to the eligible
Employees was successfully concluded and the proceeds amounting to
Rs.4,16,80,566 was credited to the account of Government of India. A
total of 7,31,238 shares were allotted to 309 employees.
Consequent upon sale of shares from Government of India to the eligible
employees, the equity holding of Government of India in MMTC has been
reduced to 89.93% from 90%.
RESERVES
A sum of Rs.12,407.78 million was available in the reserves and surplus
of your Company as on 1st April, 2013. Your Directors have proposed
that Dividend at the rate of 15% be paid out of profits of the Company.
Accordingly, an amount of Rs.12,418.70 million was available in
"Reserves and Surplus" of your Company as on 31st March, 2014.
SUBSIDIARY COMPANY
The wholly owned subsidiary of your Company - MMTC Transnational Pte.
Ltd., Singapore (MTPL) was incorporated in October 1994 under the laws
of Singapore with a share capital of US$ 1 million. During the year
2013-14, MTPL achieved business turnover of US$ 369 million. The
Profit after tax earned by MTPL during 2013-14 amounted to US$ 0.06
million. The net worth of MTPL stood at US$ 15.51 million as on 31st
March 2014. MTPL has so far paid total dividends of US$ 15.04 million
as against capital of US$ 1 million contributed by your company.
MTPL continues to enjoy prestigious "Global Trader Programme" (GTP)
status awarded to it by International Enterprise, Singapore since FY
2000.
Pursuant to the provisions of Section 129 of the Companies Act, 2013,
the audited financial statements of MTPL together with Director''s
Report & Auditor''s Report are attached herewith.
MMTC''S PROMOTED PROJECT-Neelachal Ispat Nigam Ltd. (NINL)
Your company has set up Neelachal Ispat Nigam Limited (NINL) - an iron
& steel plant of 1.1 million tonnes capacity, 0.8 million tonne coke
oven and by product unit with captive power plant, jointly with Govt.
of Orissa and others. The project has been granted Iron ore mining
lease with an estimated reserves of 110 million tonnes. The phase-II of
the Project for production of steel, with Basic Oxygen Furnace, Oxygen
Plant and SMS got commissioned in March 2013 and Steel Billets
Production also started. During the year 2013-14, NINL achieved a sales
turnover of Rs.15481.92 million and loss of Rs.1,472.17 million due to
recession in the economy and steel sector in particular. With the
stabilization of steel making facility and starting of iron ore mining
by end of this financial year, NINL''s performance is expected to
improve substantially.
Projects/ Joint Ventures
To evolve a new business model for taking advantage of new
opportunities emerging in the free market environment, your company has
promoted a number of joint ventures following the public- private
partnership route. These value multiplier initiatives are briefed
hereunder:
(i) Your company had promoted a Commodity Exchange under the name and
style of "Indian Commodity Exchange Limited" which commenced operations
in November, 2009. The said exchange has reported a net loss of
Rs.89.84 million for the year 2013-14 as against a net loss of
Rs.102.60 million during 2012-13. This is because of extremely
competitive environment in the commodity exchange market place in the
country.
(ii) Your company has participated in the equity of a Currency Futures
Exchange under the name and style of "United Stock Exchange of India
Ltd." The said Currency Futures Exchange which commenced its operations
in September, 2010 has reported a loss of Rs.39.30 million for the year
2013-14 as against a net profit of Rs.4.64 million during 2012-13.
(iii) Your company has joined hands with an international producer as a
joint venture partner for setting up a gold/silver medallion
manufacturing unit, which would also include a gold refinery as an
integral part, under the name and style of "MMTC-PAMP India Private
Limited". The said medallion manufacturing unit which commenced
commercial production in April, 2011 has reported a net profit of
Rs.737.45 million for the year 2013- 14 and has declared 30% dividend.
During the fiscal, MPIPL has been accredited as "Good Delivery"
Refinery for Silver from LBMA, achieving the coveted status of First
and Only Refinery having such status in India.
(iv) For effective marketing of the finished products from above unit,
as well as jewellery from other sources, your company has set up, in
partnership with a leading Indian company, a chain of retail stores at
various cities in India for medallions, jewellery and its homegrown
brand of ''SANCHI'' silverware. Towards this end, a JV Company was
promoted under the name and style of "MMTC-Gitanjali Limited" and 8
retail outlets are presently functioning. MMTC-Gitanjali Limited has
reported a net loss of Rs.7.86 million for the year 2013-14 as against
net profit of Rs.3.52 million during 2012-13.
(v) Your company had set up a permanent berth with loading facilities
for iron ore at Ennore Port jointly with SICAL and L&T Infrastructure
Ltd. under the name and style of M/s. SICAL Iron Ore Terminals Limited
(SIOTL). Due to non-availability of iron ore for exports from
Bellary-Hospet Sector in Karnataka State, commercial operations of
SIOTL could not commence. The JV company has been pursuing with Ennore
Port Authorities for permission to convert this facility for handling
coal discharge instead of iron ore exports, so as to meet growing
demand of thermal power plants in Tamil Nadu.
(vi) Your company had participated in the development of a deep draught
iron ore loading berth at Paradeep Port (Orissa) jointly with Noble
Group Ltd. and Gammon Infrastructure Projects Ltd. under the name and
style of M/s. Blue Water Iron Ore Terminal Private Ltd. It could not
commence construction in view of the project being rendered unviable as
a result of inordinate delay in getting mandatory clearances, change in
iron ore export trade scenario, restrictions imposed by State
Governments on mining of iron ore, refusal of Paradip Port Trust to
give concessions, etc. The JV Company is being wound up.
(vii) For exploring opportunity for investment in mines, your Company
has set up a joint venture company with M/s. TATA Steel Ltd. under the
name and style of TM Mining Ltd.(TMML) for mining exploration and
allied activities. Efforts are on to identify suitable projects to work
on.
(viii) To facilitate promotion of two-way trade, the SPV promoted by
your Company in association with IL&FS has been allotted land to set up
International Cargo hub at Haldia and Free Trade and Warehousing Zone
at Kandla on lines similar to Special Economic Zone. The SPV promoted
by MMTC has been allotted 75 acres of land at Kandla to set up a Free
Trade Warehousing Zone(FTWZ). Development of Phase-1 of Kandla FTWZ
Project is currently in progress. 200 acres of land have also been
allotted to the SPV at Haldia to set up an International Cargo Hub
outside the purview of SEZ Act, as per State Government policy.
Construction of Compound Wall to secure physical possession of the land
for the Haldia project has since started. Process for selection of a
Consultant for preparation of Business Plan/Detailed Project Report for
the Haldia Project has also been initiated.
(ix) Your company has been allotted a coal mine in the Jharkhand State
having estimated reserves of about 251.18 million tonnes classified
with proved category. Prospecting license for the same has since been
issued by the concerned authorities and the pre- feasibility study
completed. The drilling/exploration work in conformity with Govt of
India norms has since been completed in April, 2013 and the final
Geological Report has been prepared. Your Company has signed an MOU
with M/s Singareni Collieries Ltd, (A Govt of India Enterprise) for
joint mining of coal from the said coal block. The coal block allocated
to MMTC is overlapping with the CBM block allocated to ONGC which is
being sorted out in consultation with Ministry of Coal, Ministry of
Petroleum and Natural Gas and jointly with ONGC/SECL etc. Work for
preparation of mining plan & Project Report has been given to M/s.
SCCL.
INDUSTRIAL RELATIONS & HUMAN RESOURCE MANAGEMENT
Cordial and harmonious industrial relations continued to prevail in
your company with no man- days lost during the year. Regular meetings
were held with the Unions / Associations/ Federation for attaining an
amicable resolution of HR related issues to achieve Company''s goals and
objectives.
The aggregate manpower of the company as on 31st March, 2014 stood at
1530, excluding Board level executives, comprising of 567 Officers and
963 staff. This includes 12 officers, 131 staff / workers of erstwhile
Mica Trading Company Ltd., which had been merged with your company
pursuant to the orders of BIFR. While the composite representation of
the total manpower consisted of women employees representing 20.26%
(310 employees) of the total manpower, the representation of SC, ST,
OBC & persons with disabilities (PWD) was to the extent of 21.56% (330
employees), 8.49% (130 employees), 8.69% (133 employees) and 2.02% (31
employees) respectively. During the year 21officers were inducted
through campus recruitment. Presidential Directives on reservations for
SCs, STs, OBCs and PWD in services were followed fully in recruitment
and promotion.
With the objective of further enhancing / upgrading the skills of
employees in the constantly changing business scenario, 806 employees
were imparted training during the year in different spheres of
company''s activities. This was done through programmes organized both
with in- house expertise as well as external resources from renowned
institutions / organizations. The employees deputed for training
included 125 employees belonging to SC, 55 to ST and 187 women
employees. In terms of man-days such training works out to 1995
training man-days during the year 2013-14.
IMPLEMENTATION OF OFFICIAL LANGUAGE
Your Company is committed to uphold Official Language Policy of the
Government. During the year 2013-14 your company consistently strived
to adhere and implement the Official Language Policy to meet the
targets given in the annual programme issued by the Department of
Official Language, Ministry of Home Affairs, Govt. of India. Towards
this and to promote usage of the Official Language by employees of the
company, several programs in the form of Hindi Workshops, Hindi
Seminars, Hindi Day/Week/Fortnight were organized at the Corporate
Office and Regional Offices.
During the year, the Company had the privilege of interacting with the
Parliamentary Committee on Official Languages, which inspected your
company''s Mumbai Regional Office and expressed satisfaction with regard
to Implementation of Official Language Policy in the Organization.
During the year, the Company was awarded the Second Prize in the form
of Rajbhasha Trophy for excellence in implementation of Official
Language Policy in the Company by Ministry of Commerce.
VIGILANCE
Continuing to foster the goodwill & confidence stemming from value
based business practices and strengthening the Company as a
professionally managed, globally competitive & internationally reputed
organization, the vigilance group of your company carried further its
focus on preventive vigilance. During the period under review, a total
number of 13 cases (involving 47 officials) were dealt by Vigilance
Division. Five fresh cases(involving 21 officials) were added to the
opening tally of 9 cases. Progress of vigilance work/disciplinary cases
is being reviewed regularly by the Board of Directors. During the
period under review, 60 vigilance and 19 non- vigilance inspection
reports were received from VOs posted at various regional offices of
MMTC. Corporate Risk Management Policy has been implemented. During
the period under reference, Vigilance Division processed 36 complaints
out of which 18 complaints have been disposed of and action on the
remaining 18 complaints is in progress.
Your Company has filed a suit in the Hon''ble Mumbai High Court against
National Spot Exchange Limited, Financial Technologies and others for
recovery of Rs.227 crores on account of unsettled transactions which
took place on the platform of NSEL during 2013-14. An amount of
Rs.14.23 crores has been realized by your Company from weekly payments
disbursed by NSEL since August, 2013. Your Company has also filed a
criminal complaint against NSEL with Economic Offence Wing, Delhi
Police & CBI Mumbai have registered a regular case in July 2014 where
investigation is in progress. As per reports EOW, Mumbai Police has
attached properties of defaulters valuing Rs.5100 crores under
Maharashtra Protection of Interest of depositors act and the court has
permitted auction of the properties. NSEL is also under investigation
by Enforcement Directorate, Income Tax Department, Ministry of
Corporate Affairs and Forward Market Commission. Along with the 13000
other investors, with total dues of Rs.5600 crores, your Company is
hopeful of realizing its dues through liquidation of the defaulters''
properties attached by the investigating agencies.
During the year under report Vigilance group of your Company was also
instrumental in organizing "Vigilance Awareness Week" in various
offices of MMTC from 29.10.2013 to 02.11.2013. The theme for the week
was "Promoting Good Governance-Positive Contribution of Vigilance".
New initiatives undertaken by Vigilance Division include scheduling the
workshops/training programmes for vigilance & non-vigilance officers on
zonal basis, ERP system up-gradation work for plugging the gaps in
existing ERP Module, issuing instructions to all regional heads
reiterating the provisions of MMTC Bullion Drill pertaining to KYC
norms with regard to verification of new bullion customer/their
credentials/financial standing and also emphasizing the need for
obtaining adequate financial security etc.
INTEGRITY PACT
During the year, Integrity Pact has been implemented in the Company to
promote transparency/equity amongst the bidders so as to plug
possibility of corrupt practices. Integrity Pact is being implemented
as part of series of steps taken by Central Vigilance Commission for
ensuring transparency, equity and competitiveness in public
procurement. Shri Bijoy Chatterjee, IAS (retd.) has been appointed to
function as Independent External Monitor(IEM).
CORPORATE SOCIAL RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT
As a truly responsible enterprise, your Company has always been
committed to discharge its social responsibility in the best possible
way. Various initiatives have been taken for the benefit of society and
the environment since 2006-2007. With a view to address the CSR issues,
your Company had revised its Corporate Social Responsibility Policy in
line with the Guidelines issued by Department of Public Enterprises,
Govt. of India. In terms of the prevailing CSR guidelines, there being
no profits for the year 2012-13, no funds were earmarked for CSR/SD
projects. However, the unutilized amounts of previous years carried
forward to the financial year 2013-14 were used for undertaking CSR &
SD Projects in the area of livelihood creation for increasing
employability and employment generation in Jajpur District, Odisha, and
installation of energy efficient lighting system in MMTC premises at
Delhi.
Your Company is a member of the Global Compact Network, India and apart
from undertaking CSR/SD initiatives in line with the Global Compact
Principles, it also submits its Communication on Progress(COP) to UN
Global Compact every year.
CORPORATE GOVERNANCE
Corporate governance is an area of major significance not only to
governments and businesses but to all who are connected with
organizations, whether as investors, directors, employees, suppliers,
customers or the community in general. Your Company reposes its firm
faith in continuous development, adoption and dedication towards the
best corporate governance practices.
A separate report on corporate governance along with Statutory Auditor
certificate regarding compliance of the stipulations relating to
corporate governance specified in clause 49 of the Listing Agreement(s)
signed with stock exchanges is annexed to and forms part of this
report.
CODE OF CONDUCT
Pursuant to Clause 49 (I)(D) of the Listing Agreement signed with Stock
Exchanges, a detailed Code of Conduct for Board Members and Senior
Management Personnel has been laid down and hoisted on the website of
your company. All Board Members and Senior Management Personnel, except
one General Manager(under suspension) on the regular rolls of the
Company as on 31st March, 2014, to whom the said Code is applicable,
have affirmed compliance of the same for the period ended 31st March,
2014.
PRESIDENTIAL DIRECTIVES
Pursuant to Article 136 of Articles of Association of MMTC Limited,
during the year 2013-14, the Company received a Presidential Directive
vide Communication dated 28.9.2013 from Department of Commerce,
Ministry of Commerce & Industry directing Shri Ved Prakash, the senior
most Functional Director of MMTC Ltd. to act as Chairman at the AGM
held on 30.9.2013 in the absence of Shri D.S. Dhesi, CMD.
BUSINESS RESPONSIBILITY REPORT
In accordance with the directives of SEBI and provisions of Clause 55
of Listing Agreement signed with stock exchanges, based on the list of
top 100 companies given by BSE, your Company has prepared the Business
Responsibility Report for inclusion in the Annual Report for the year
2013-14. The framework and principles suggested by SEBI to assess
compliance with environment, social and governance norms pertain to
Corporate Social Responsibility and Sustainable Development activities
of the Company. The Business Responsibility Report of your Company is
annexed herewith and forms part of the Annual Report.
PUBLIC DEPOSIT SCHEME
As on 1st April 2013, there were no outstanding public deposits and the
company did not invite/ accept any public deposit during the year ended
31st March, 2014.
STATUTORY AUDITOR''S REPORT
The report of Statutory Auditors for the year 2013-14 alongwith
Management''s reply to the observations of the Statutory Auditors is
annexed herewith.
COMMENTS OF COMPTROLLER & AUDITOR GENERAL OF INDIA
The comments of Comptroller & Auditor General of India(C&AG) under
section 619(4) of the Companies Act, 1956 on the accounts of the
Company for the year ended 31.03.2014 are yet to be received and the
same alongwith Management''s reply thereon, if any shall be placed on
the table at the Annual General Meeting.
CONSERVATION OF ENERGY
During the year 2013-14, there was no activity in Mica group of your
company. Pursuant to Section 217(i)(e) of the Companies Act, 1956, a
statement on conservation of energy is annexed to this report.
PARTICULARS OF EMPLOYEES
Pursuant to provisions of section 217(2A) of the Companies Act, 1956
read with the Companies (Particulars of Employees) Rules, 1975, as
amended from time to time, it is stated that there were no employees
who were in receipt of remuneration exceeding Rs.60 lakhs per annum or
Rs. 5.00 lakhs per month during the year 2013-14.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 217(2AA) of the Companies Act,
1956, your Directors state:
i) That in the preparation of the annual accounts, the applicable
accounting standards had been followed along with proper explanation
relating to material departures;
ii) That the Directors had selected such accounting policies and
applied them consistently and made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
profit and loss of the Company for the year ended 31.3.2014;
iii) That the Directors have taken a proper and sufficient care for the
maintenance of the adequate accounting records in accordance with the
provisions of Companies Act, 1956 for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities;
iv) That the Directors have prepared the annual accounts on ongoing
concern basis.
BOARD OF DIRECTORS
Following are the changes in the Board of Directors of your company
since 1st April 2013: -
- Shri Arvind Kalra took over the charge of Part Time
Non-Official(Independent)Director on the Board of MMTC w.e.f. 1st
April, 2013.
- Shri Rana Som took over the charge of Part Time
Non-Official(Independent)Director on the Board of MMTC w.e.f. 17th
April, 2013.
- Shri N. Bala Baskar took over the charge of Part Time
Non-Official(Independent) Director on the Board of MMTC w.e.f. 22nd
April 2013.
- Dr. Subas Pani took over the charge of Part Time Non-Official
(Independent) Director on the Board of MMTC w.e.f. 7th May, 2013.
- Shri P.K. Jain took over the charge of Director(Marketing) on the
Board of MMTC w.e.f. 15th May, 2013.
- Shri Skand Ranjan Tayal took over the charge of Part Time
Non-Official (Independent) Director on the Board of MMTC w.e.f. 9th
July 2013.
- Smt. Anita Agnihotri, AS&FA, Department of Commerce, Ministry of
Commerce & Industry relinquished the charge of Part Time Director on
the Board of MMTC on 16th June, 2014.
- Shri Bhagwati Prasad Pandey, AS&FA, Department of Commerce, Ministry
of Commerce & Industry took charge of Part Time Director on the Board
of MMTC vice Smt. Anita Agnihotri w.e.f. 16th June, 2014.
- Shri Anil Razdan relinquished the charge of Part Time Non
Official(Independent) Director on 12th July,2014.
- Shri G.S. Vedi relinquished the charge of Part Time Non
Official(Independent) Director on 13th July, 2014.
- Shri Arun Balakrishnan relinquished the charge of Part Time Non
Official(Independent) Director on 15th July 2014
The Board places on record its deep appreciation for the commendable
services and the contributions made by Smt. Anita Agnihotri, Shri Anil
Razdan, Shri G.S. Vedi and Shri Arun Balakrishnan and also welcomes
Shri B.P. Pandey and expresses its confidence that the Company shall
immensely benefit from his rich and varied experience.
In terms of provisions of Article 87(4)(A) of Articles of Association
of the Company regarding rotational retirement of Directors, Shri P.K.
Jain, Director(Marketing) and Shri Anand Trivedi, Director(Marketing)
shall retire at the AGM and, being eligible, have offered themselves
for reappointment.
ACKNOWLEDGEMENTS
Your Directors would like to acknowledge and place on record their
sincere appreciation of all stakeholders- Shareholders, Department of
Commerce, all Govt. Agencies, RBI and other Banks, Railways, Customs,
Ports, NMDC, Customers, Suppliers and other business partners for the
excellent support and cooperation received from them during the year.
Your Directors also recognize and appreciate the efforts and hard work
of all the employees of the Company and their continued contribution
towards its progress.
By the Order of the Board
sd/-
(D.S. Dhesi)
Chairman-cum-Managing Director
Dated: 13.08.2014
Mar 31, 2013
The Members of MMTC Limited, New Delhi.
Ladies & Gentlemen,
The behalf of Board of Directors, I have pleasure in presenting 50th
Annual Report on the performance of your company for the financial year
ended 31st March 2013 along with audited statements of accounts and
Statutory Auditor''s Report.
RESULTS OF OPERATIONS
Your company, one of the leading trading companies in India, recorded a
business turnover of Rs. 284156.2 million during 2012-13 as against the
business turnover of Rs. 659291.1 million registered last fiscal. This
business turnover includes Exports of Rs.29795.4 million, Imports of
Rs. 209544.1 million and domestic trade of Rs. 44816.7 million. The
other trade related earnings contributed Rs.1837.9 million. The trading
profit earned by your Company stood at Rs. 2997.5 million as against Rs
2766.1 million during last fiscal. The Company has reported Net Loss of
Rs.706.2 million during the year due to provisions made in respect of
Extraordinary items relating to bullion transactions at Regional
Offices Hyderabad and Chennai amounting to Rs.2443.6 million .
The highlights of the Company''s performance during 2012-13 are as
below: -
(Rs in Millions)
2011-12 2012-13
Net Sales/Trade Earnings 663,248.84 285,983.59
Cost of Sales 660482.70 282,986.11
Trading Profit 2766.14 2,997.48
ADD: Dividend and other Income 811.94 382.58
Less: Establishment & Administrative
Overheads, and 2364.59 2639.80
exceptional items etc
Less: Debts/Claims Written off 1.35 0.70
Less: Provisions for Doubtful Debts/ 133.11 62.53
Claims/Advances/Investments
Profit Before Interest, Dep., Prior
Period & Taxes 1,079.03 677.03
Add: Interest Earned (Net) 693.92 601.81
Profit Before Dep., Prior Period & Taxes 1,772.15 1278.84
Less: Depreciation 120.03 119.70
Less: Prior Period Adjustment (109.26) (6.12)
Profit Before Taxes and extra ordinary items 1,762.18 1165.26
Less: Extraordinary item 1,002.05 2,443.64
Less: Provision for Current Taxes 432.41 167.14
Less: Provision for Deferred Taxes (379.47) (739.28)
Profit After Taxes 707.19 (706.24)
Add: Balance brought forward from the
previous year 6,915.56 7,257.19
Balance
Which the director have appropriated as
under to:
(I) Proposed Dividend 250.00 100.00
(II) Dividend Tax 40.56 -
(III) General reserve 75.00 -
(IV) Sustainable Development Reserve - 2.11
(V) Corporate Social Responsibility Reserve - 4.36
TOTAL
Leaving a balance of to be carried forward 7,257.19 6444.48
The performance of different business groups of your Company is
highlighted in the Management Discussions and Analysis Report, which is
annexed and forms part of this Report.
AWARDS & RANKINGS
Following Awards and Rankings were conferred on your Company during
2012-13:
- Most Caring Companies of India Award to MMTC presented by "The
World CSR Congress" recognizing Organisations for contributions made in
the field of CSR.
- Star Performer Award for the year 2011-12 in the product group of
Basic Iron and Steel (Large Enterprise) by EEPC (National Award)
- Top Exporters for the year 2010-11, Silver Trophy, Medium
Enterprise by EEPC India (N.R.)
- TCC Exim Award (II position) in the import category for 2011-12 by
The Tamil Chamber of Commerce, Chennai.
- 11th rank in 2012 on the basis of net sales and 14th rank in terms
of Market Capitalization by Business India''s Super 100 rankings
published in Business India on 23rd Dec.2012.
EQUITY SHARE CAPITAL & DIVIDEND
The Board of Directors recommends declaration of dividend @10% on the
equity capital of Rs 1,000 million of the Company for the year 2012-13
out of accumulated past profits of the Company.
DISINVESTMENT BY THE GOVERNMENT
In accordance with the SEBI directions on minimum public shareholding
requirement in the listed companies, Govt. of India, the promoter of
your Company holding 99.33% of the total equity capital as on 31.3.2013
divested its 9.33% equity through "Offer for Sale" of shares through
stock exchange mechanism pursuant to SEBI guidelines in this regard.
The said OFS issue was made by the Govt through stock exchange platform
at NSE and BSE on 13th June, 2013 thereby reducing Govt. of India''s
equity to 90% of the total paid up equity of your Company.
RESERVES
A sum of Rs.13214.01 million was available in the reserves and surplus
of your Company as on 1st April 2012. Your Directors have proposed that
Dividend at the rate of 10% to be paid out of accumulated past profits
of the Company. Accordingly an amount of Rs.12407.78 million shall be
available in "Reserves and Surplus" of your Company as on 31st March
2013.
SUBSIDIARY COMPANY
The wholly owned subsidiary of your Company - MMTC Transnational Pte.
Ltd. Singapore (MTPL) was incorporated in October 1994 under the laws
of Singapore with a share capital of USD 1 million. During the year
2012-13, MTPL achieved business turnover of USD 600 million. The
Profit after tax earned by MTPL during 2012-13 amounted to USD 2.11
million. The net worth of MTPL stood at USD 15.45 million as on 31st
March 2013. MTPL has so far paid total dividends of US$ 15.04_million
as against capital of US$ 1 million contributed by your company.
MTPL continues to enjoy prestigious "Global Trader Programme" (GTP)
status awarded to it by International Enterprise, Singapore since FY
2000
Pursuant to the provisions of Section 212 of the Companies Act, 1956,
the audited financial statements of MTPL together with Director''s
Report & Auditor''s report are attached herewith.
MMTC''S PROMOTED PROJECT-Neelachal Ispat Nigam Ltd. (NINL)
Your company has set up Neelachal Ispat Nigam Limited (NINL) - an iron
& steel plant of 1.1 million tonnes capacity, 0.8 million tonne coke
oven and by product unit with captive power plant, jointly with Govt.
of Orissa. The project has been granted Iron ore mining lease with an
estimated reserves of 110 million tons. The phase-II of the Project for
production of steel, with Basic Oxygen Furnace, Oxygen Plant and SMS
got commissioned in March 2013 and Steel Billets Production also
started. During the year 2012-13, NINL achieved a sales turnover of
Rs.16,256.1 million which includes export of pig iron worth Rs.2657.0
million, domestic sales of pig iron valued at Rs 8680.7 million and BF
coke valued at Rs.2400.2 million as against the total turnover of
Rs.19391.17 million during 2011-12. With the commissioning and
stabilization of steel making facility and starting of iron ore mining
probably during later part of current year, NINL''s performance is
expected to improve. In the first five months of the current financial
year we have finalized contracts for export of 7 vessels of pig iron
compared to only 4 vessels exported in FY 2012-13.
Projects/ Joint Ventures
To evolve a new business model for taking advantage of new
opportunities emerging in the free market environment, your company has
promoted a number of joint ventures following the public- private
partnership route. These value multiplier initiatives are briefed
hereunder:
(i) Your company had promoted a Commodity Exchange under the name and
style of "Indian Commodity Exchange Limited" which commenced operations
in November 2009. The said exchange has reported a net loss of
Rs.102.6 million for the year 2012-13 as against a net loss of Rs.255.6
million during 2011-12.
(ii) Your company has participated in the equity of a Currency Futures
Exchange under the name and style of "United Stock Exchange of India
Ltd." The said Currency Futures Exchange which commenced its operations
in September 2010 has reported a profit of Rs.4.6 million for the year
2012-13 as against a net loss of Rs.47.1 million during 2011-12.
(iii) Your company has joined hands with an international producer as a
joint venture partner for setting up a gold/silver medallion
manufacturing unit, which would also include a gold refinery as an
integral part, under the name and style of "MMTC-Pamp India Private
Limited". The said medallion manufacturing unit which commenced
commercial production in April 2011 has reported a net profit of
Rs.378.48 million for the year 2012- 13 as against a net loss of
Rs.220.5 million during 2011-12.
(iv) For effective marketing of the finished products from above unit,
as well as jewellery from other sources, your company has set up in
partnership with a leading Indian company, a chain of retail stores at
various cities in India for medallions, jewellery and its homegrown
brand of ''SANCHI'' silverware. Towards this end a JV Company was
promoted under the name and style of "MMTC-Gitanjali Private Limited"
with 8 retail outlets presently functioning. MMTC-Gitanjali Private
Limited has reported a net profit of Rs.3.52 million for the year
2012-13 as against Rs.1.2 million during 2011-12.
(v) Your company had set up a permanent berth with loading facilities
for iron ore at Ennore Port jointly with SICAL and L&T Infrastructure
Ltd. under the name and style of M/s. SICAL Iron Ore Terminals Limited
(SIOTL). Due to non-availability of iron ore for exports, commercial
operations of SIOTL could not commence. The Jv company has been
pursuing with Ennore Port Authorities for permission to modify the
facility for handling coal discharge instead of iron ore so as to meet
growing demand for thermal power plants in Tamil Nadu.
(vi) Your company had participated in development of a deep draught
iron ore loading berth at Paradeep Port (Orissa) jointly with Noble
Group Ltd. and Gammon Infrastructure Projects Ltd. under the name and
style of M/s. Blue Water Iron Ore Terminal Private Ltd. It could not
commence construction in view of the project being rendered unviable as
a result of inordinate delay in getting mandatory clearances, change in
iron ore export trade scenario, restrictions imposed by State Govts. on
mining of iron ore, refusal of Paradip Port Trust to give concessions,
etc. The JV Company is being wound up.
(vii) Towards investing in mining exploration your Company has set up a
joint venture company with M/s. TATA Steel Ltd. under the name and
style of TM Mining Ltd.(TMML) for mining exploration and allied
activities had applied for mineral concession(mining leases) for
manganese ore in Odisha. One of the lease applications has been cleared
by the Forest and Mining Depts. while clearance from Revenue Dept. is
awaited. Once clearance from the Revenue Dept. is received, the same
would be forwarded to Mines Dept. of Govt. of Odisha.
(viii) To facilitate promotion of two-way trade, the SPV promoted by
your Company in association with IL&FS has been allotted land to set up
free trade and warehousing zones at Haldia and Kandla on lines similar
to Special Economic Zones. Action is being taken to develop these Zones
for promotion of trade.
(ix) Your company has been allotted a coal mine in the Jharkhand State
having estimated reserves of about 251.18 million tones classified with
proved category. Prospecting license for the same has since been issued
by the concerned authorities and the pre- feasibility study completed.
The drilling/exploration work in conformity with Govt of India norm has
since been completed in April, 2013 and the final Geological Report has
been prepared. Your Company has signed an MOU with M/s Singareni
Collieries Ltd, (A Govt of India Enterprise) for joint mining of coal
from the said coal block.
INDUSTRIAL RELATIONS & HUMAN RESOURCE MANAGEMENT
Cordial and harmonious industrial relations continued to prevail in
your company with no man- days lost during the year. Regular meetings
were held with the Unions / Associations/ Federation for attaining an
amicable resolution of HR related issues to achieve Company''s goals
and objectives.
The aggregate manpower of the company as on 31st March 2013 stood at
1,605, excluding Board level executives, comprising of 602 Officers and
1,003 staff. This includes 15 officers, 138 staff / workers of
erstwhile Mica Trading Company Ltd., which had been merged with your
company pursuant to the orders of BIFR. While the composite
representation of the total manpower consisted of women employees
representing 19.31% (310 employees) of the total manpower, the
representation of SC, ST, OBC & persons with disabilities (PWD) was to
the extent of 21.62% (347 employees), 8.35% (134 employees), 8.53% (137
employees) and 2.30% (37 employees) respectively. During the year 26
officers were inducted through campus recruitment. Presidential
Directives on reservations for SCs, STs, OBCs and PWD in services were
followed fully in recruitment and promotion.
Aiming towards further enhancing / upgrading the skills of employees in
the constantly changing business scenario 666 employees were imparted
training during the year in different spheres of company''s
activities. This was done through programmes organized both with
in-house expertise as well as external resources from renowned
institutions / organizations. The employees deputed for training
included 127 employees belonging to SC, 50 to ST, 23 to OBC, 9 to PWD
and 149 women employees. In terms of man-days such training works out
to 2,102 training man-days during the year 2012-13.
IMPLEMENTATION OF OFFICIAL LANGUAGE
Your Company is committed to uphold Official Language Policy of the
Government. During the year 2012-13, your company consistently strived
to adhere and implement the Official Language Policy to meet the
targets given in the annual programme issued by the Department of
Official Language, Ministry of Home Affairs, govt. of India. Towards
this and to promote usage of the Official Language by employees of the
company, several programs in the form of Hindi Workshops, Hindi Week/
Fortnight were organized at the Corporate Office and Regional Offices.
During the year, the Company had the privilege of interacting with the
Parliamentary Committee on Official Languages, which inspected your
company''s Hyderabad, Bengaluru Regional Office and Kochi Sub Regional
Office whereat the Hon''ble Committee gave valuable suggestions with
regard to the implementation of the Official Language Policy in MMTC..
VIGILANCE
Continuing to foster the goodwill & confidence stemming from value
based business practices and strengthening the Company as a
professionally managed, globally competitive & internationally reputed
organization, the vigilance group of your company carried further its
focus on preventive vigilance. During the year regular inspections were
conducted by vigilance & non- vigilance officers and based on the
feedback received, corrective/ preventive measures were suggested.
Special emphasis was also laid on updation of trade related drills/
manuals and suggesting systemic improvements in the areas related to
e-tendering, KYC norms, creation of price monitoring cell,
implementation of integrity pact, whistle blower policy and preparation
of vigilance manual.
During the year under report Vigilance group of your Company was also
instrumental in organizing "Vigilance Awareness Week" in various
offices of MMTC from 29.10.2012 to 3.11.2012. The theme for the week
was "Transparency in the Public Procurement".
Your company has made an extraordinary ad-hoc provision of Rs 2,288.20
millions in the accounts for the year ended 31st March 2013 against
amount recoverable from debtors pertaining to previous years arising on
account of certain acts of commission and omission at your company''s
Regional Office, Hyderabad relating to Bullion transactions. A
reference in the matter has been made to CBI which registered a case in
January 2013 against the defaulting Party, officers of MMTC and unknown
public and private persons.
CORPORATE SOCIAL RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT
Your Company has been a constructive partner in the communities in
which it has operated since its inception in 1963, embracing
responsibility and encouraging a positive impact on the environment,
communities, stakeholders and the society at large. Based on Profit
After Tax(PAT) of 2011-12 of Rs.707.2 million, the MMTC Board of
Directors approved CSR and SD budget of Rs.21.2 million and Rs.3.5
million respectively in accordance with the DPE guidelines on CSR &
Sustainable Development. During 2012-13, projects valuing Rs.19.7
million were undertaken under CSR and Rs.3.5 million under Sustainable
Development.
The Sustainable Development initiatives of MMTC had Energy conservation
and management as a major focus area. An "energy audit" of corporate
office was conducted by Energy Efficiency Services Limited.
Implementation of recommendations are underway. The various energy
efficiency measures would be introduced in phases.
In addition, MMTC underwent a third party assessment for measuring the
impact of its CSR activities undertaken during the year. A Prospective
Plan outlining the CSR/SD initiatives was also drawn up with external
assistance which would guide the CSR/SD activities of MMTC over the
next ten years.
CORPORATE GOVERNANCE
Corporate governance is an area of major significance not only to
governments and business but to all who are affected by organizations
in some way, whether as investors, directors, employees, suppliers,
customers or the community in general. Your Company reposes its firm
faith in continuous development, adoption and dedication towards the
best corporate governance practices.
A separate report on corporate governance along with Statutory Auditor
certificate regarding compliance of the stipulations relating to
corporate governance specified in clause 49 of the listing agreement(s)
signed with stock exchanges is annexed to and forms part of this
report.
CODE OF CONDUCT
Pursuant to Clause 49 (I)(D) of the Listing Agreement signed with Stock
Exchanges, a detailed Code of Conduct for Board Members and Senior
Management Personnel has been laid down and hoisted on the website of
your company. All Board Members and Senior Management Personnel, except
one General Manager(under suspension) on the regular rolls of the
Company as on 31st March 2013, to whom the said Code is applicable have
affirmed compliance of the same for the period ended 31st March 2013.
BUSINESS RESPONSIBILITY REPORT
In accordance with the directives of SEBI and provisions of Clause 55
of Listing Agreement signed with stock exchanges, based on the list of
top 100 companies given by BSE, your Company has prepared the Business
Responsibility Report for inclusion in the Annual Report for the year
2012-13. The framework and principles suggested by SEBI to assess
compliance with environment, social and governance norms pertaining to
Corporate Social Responsibility and Sustainable Development activities
of the Company. The first Business Responsibility Report of your
Company is annexed herewith and forms part of the Annual Report.
PUBLIC DEPOSIT SCHEME
As on 1st April 2013, there were no outstanding public deposits and the
company did not invite/ accept any public deposit during the year ended
31st March 2013.
STATUTORY AUDITOR''S REPORT
The report of Statutory Auditors for the year 2012-13 alongwith
Management''s reply to the observations of the Statutory Auditors is
annexed herewith.
COMMENTS OF COMPTROLLER & AUDITOR GENERAL OF INDIA
The comments of Comptroller & Auditor General of India(C&AG) under
section 619(4) of the Companies Act, 1956 on the accounts of the
Company for the year ended 31.03.2013 alongwith Management''s reply on
the comments are annexed herewith.
CONSERVATION OF ENERGY
During the year 2012-13, there was no activity in Mica group of your
company. Pursuant to Section 217(i)(e) of the Companies Act, 1956, a
statement on conservation of energy is annexed to this report.
PARTICULARS OF EMPLOYEES
Pursuant to provisions of section 217(2A) of the Companies Act, 1956
read with the Companies (Particulars of Employees) Rules, 1975, as
amended from time to time, it is stated that there were no employees
who were in receipt of remuneration exceeding Rs.60 lakhs per annum or
Rs. 5.00 lakhs per month during the year 2012-13.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 217(2AA) of the Companies Act,
1956, your Directors state:
i) That in the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
ii) That the Directors had selected such accounting policies and
applied them consistently and made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
loss of the Company for the year ended 31.3.2013;
iii) That the Directors have taken a proper and sufficient care for the
maintenance of the adequate accounting records in accordance with the
provisions of Companies Act, 1956 for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities;
iv) That the Directors have prepared the annual accounts on a going
concern basis.
BOARD OF DIRECTORS
Following are the changes in the Board of Directors of your company
since 1st April 2012: -
- Shri D.S. Dhesi, Additional Secretary, Department of Commerce &
Industry assumed the additional charge of Chairman-cum-Managing
Director on 08th October 2012.
- Smt. Vijaylaxmi Joshi, Additional Secretary, Department of Commerce
& Industry relinquished the additional charge of CMD on 05th October
2012.
- Dr. Rajan Katoch, AS&FA, Department of Commerce, Ministry of
Commerce & Industry relinquished the charge of Part Time Director on
the Board of MMTC on 22nd May, 2012.
- Smt. Anita Agnihotri, AS&FA, Department of Commerce, Ministry of
Commerce & Industry took the charge of Part Time Director on the Board
of MMTC vice Dr. Rajan Katoch w.e.f. 22nd May, 2012.
- Shri Anil Baijal relinquished the charge of Part Time
Non-Official(Independent) Director on 11th June, 2012.
- Smt. Aruna Makhan relinquished the charge of Part Time Non-
Official(Independent)Director on 14th June, 2012.
- Shri H.L. Zutshi relinquished the charge of Part Time
Non-Official(Independent) Director on 11th June, 2012.
- Shri Anand Trivedi took over the charge of Director(Marketing) on
the Board of MMTC w.e.f. 3rd July, 2012.
- Shri Sunir Khurana relinquished the charge of Director(Marketing)
on 18th September, 2012.
- Shri Arvind Kalra took over the charge of Part Time
Non-Official(Independent) Director on the Board of MMTC w.e.f. 1st
April, 2013.
- Shri Rana Som took over the charge of Part Time
Non-Official(Independent)Director on the Board of MMTC w.e.f. 17th
April, 2013.
- Shri N. Bala Baskar took over the charge of Part Time
Non-Official(Independent) Director on the Board of MMTC w.e.f. 22nd
April 2013.
- Dr. Subas Pani took over the charge of Part Time Non-Official
(Independent) Director on the Board of MMTC w.e.f. 7th May, 2013.
- Shri P.K. Jain took over the charge of Director(Marketing) on the
Board of MMTC w.e.f. 15th May, 2013.
- Shri Skand Ranjan Tayal took over the charge of Part Time
Non-Official (Independent) Director on the Board of MMTC w.e.f. 9th
July 2013.
The Board places on record its deep appreciation for the commendable
services and the contributions made by Smt. Vijaylaxmi Joshi, Dr Rajan
Katoch, Shri Anil Baijal, Shri H L Zutshi, Smt Aruna Makhan and Shri
S.Khurana towards effective discharge of the functions of the Board and
its Committees. The Board also welcomes Shri D.S. Dhesi, Smt Anita
Agnihotri, Shri Anand Trivedi, Shri Arvind Kalra, Shri Rana Som, Shri
N. Bala Baskar, Dr. Subas Pani, Shri P.K. Jain and Shri Skand Ranjan
Tayal and expresses confidence that the Company shall immensely benefit
from their rich and varied experience.
In terms of provisions of Article 87(4)(A) of Articles of Association
of the Company regarding rotational retirement of Directors, Shri Arun
Balakrishnan, Non-official Part Time(Independent) Director, Shri M.G.
Gupta, Director(Finance), Shri Madhusudan Prasad, Part Time Director
and Smt. Anita Agnihotri, Part Time Director shall retire at the AGM
and being eligible have offered themselves for reappointment.
ACKNOWLEDGEMENTS
Your Directors would like to acknowledge and place on record their
sincere appreciation of all stakeholders- shareholders, Department of
Commerce, all Govt. Agencies, RBI and other Banks, Railways, Customs,
Ports, NMDC, Customers, Suppliers and other business partners for the
excellent support and cooperation received from them during the year.
Your Directors also recognize and appreciate the efforts and hard work
of all the employees of the Company and their continued contribution to
its progress.
By the Order of the Board
sd/-
(D.S. Dhesi)
Chairman-cum-Managing Director
Dt. 14.8.2013
Mar 31, 2012
To The Members of MMTC Limited
On behalf of Board of Directors, I have pleasure in presenting 49th
Annual Report on the performance of your company for the financial year
ended 31st March 2012 along with audited statements of accounts and
Statutory Auditor's Report.
RESULTS OF OPERATIONS
Your company, currently holding the no. 1 rank amongst trading
companies in India, recorded a business turnover of Rs. 659,291 million
during 2011-12 as against the business turnover of Rs.688,545 million
registered last fiscal. This business turnover includes Exports of Rs.
20,454 million, Imports of Rs. 610,418 million and domestic trade of
Rs. 28,419 million. The other trade related earnings contributed
Rs.3,958 million. The trading profit earned by your Company stood at
Rs.2,766 million as against Rs 3,300 million during last fiscal. The
net profit earned by your company during 2011-12 amounted to Rs. 707
million.
The highlights of the Company's performance during 2011-12 are as
below: -
(Rs in Millions)
2010-11 2011-12
Net Sales/Trade Earnings 690,560.02 663,248.84
Cost of Sales 687,260.02 660,482.84
Trading Profit 3,300.00 2,766.00
ADD: Dividend and other Income 327.05 811.94
Less: Establishment &
Administrative Overheads,etc 2,181.03 2,383.44
Less: Debts/Claims Written off 0.92 1.34
Less: Provisions for Doubtful Debts/ 229.39 114.10
Claims/Investments
Profit Before Interest, Dep.,
Prior Period & Taxes 1,215.71 1,079.06
Add: Interest Earned (Net) 821.96 693.91
Profit Before Dep., Prior
Period & Taxes 2,037.67 1,772.97
Less: Depreciation 123.42 120.03
Less: Prior Period Adjustment 15.22 (109.26)
Profit Before Taxes and
extra ordinary items 1,899.03 1,762.20
Less: Adhoc Provision
(Extraordinary item) 0.00 1,002.05
Less: Provision for Current Taxes 791.42 432.40
Less: Provision for Deferred Taxes (108.82) (379.47)
Profit After Taxes 1,216.43 707.22
Add: Balance brought forward
from the previous 6,119.65 6,915.53
year
Balance
Which the director have
appropriated as under to:
(I) Proposed Dividend 250.00 250.00
(II) Dividend Tax 40.55 40.56
(III) General reserve 130.00 75.00
TOTAL
Leaving a balance of to be
carried forward 6,915.53 7,257.19
The performance of different business groups of your Company is
highlighted in the Management Discussions and Analysis Report, which is
annexed and forms part of this Report.
AWARDS & RANKINGS
Following Awards and Rankings were conferred on your Company during
2011-12:
- MOU Excellence Award for 2009-10.
- CAPEXIL's award for Highest Export in Minerals and Ores Sector for
the year 2010-11(20th time in a row).
- DHL-CNBC-TV18 International Trade Award 2010-11, powered by ICRA.
- EEPC India Gold Trophy (Top Exporter) for the year 2009-10.
- EEPC India National Award for export excellence - "Star Performer
Award" for the year 2010-11 in the product group of Basic Iron & Steel.
- EEPC India (Northern Region) Award (Silver Trophy) for the year
2010-11.
- Dun & Bradstreet Rolta Corporate Awards 2011- Top Indian Company in
the Trading sector amongst "India's Top 500 Companies 2011".
- Dun & Bradstreet PSU Awards 2012- top Indian public Sector
enterprises in the Trading sector.
- Public Relations Society of India's PRSI National Awards - 2011-
second prize for Event Management for Festival of Gold organized by
MMTC.
- BT Star PSU Excellence Award 2012 for excellence in Corporate Social
Responsibility.
- 17th rank in BT 500 (publication of Business Today) amongst "India's
most valuable companies"
- Trophy for commendable work done in the field of "Rajbhasha" under
the aegis of Department of Commerce, MOC&I.
EQUITY SHARE CAPITAL & DIVIDEND
The Board of Directors recommends declaration of dividend @25% on the
equity capital of Rs 1,000 million of the Company for the year 2011-12.
RESERVES
A sum of Rs. 12,797.35 million was available in the reserves and
surplus of your Company as on 1st April 2011. Your Directors have
proposed that out of Rs.416.66 million available out of the profits for
the year 2011-12, after payment of dividend and tax thereon, an amount
of Rs.75 million be transferred to General Reserves of the Company and
balance profit of Rs.341.66 million be carried forward as retained
profits. Accordingly an amount of Rs. 13,214.01 million shall be
available in "Reserves and Surplus" of your Company as on 31st March
2012.
SUBSIDIARY COMPANY
The wholly owned subsidiary of your Company - MMTC Transnational Pte.
Ltd. Singapore (MTPL) was incorporated in October 1994 under the laws
of Singapore with a share capital of USD 1 million. During the year
2011-12, MTPL achieved business turnover of USD 708.65 million. The
Profit after tax earned by MTPL during 2011-12 amounted to USD 1.87
million. The net worth of MTPL stood at USD 15.21 million as on 31st
March 2012. MTPL has so far paid total dividends of US$ 13.17 million
as against capital of US$ 1 million contributed by your company besides
multiplying its net worth by over 15 times since its inception.
MTPL continues to enjoy prestigious "Global Trader Programme" (GTP)
status awarded to it by International Enterprise, Singapore since FY
2000
Pursuant to the provisions of Section 212 of the Companies Act, 1956,
the audited financial statements of MTPL together with Director's
Report & Auditor's report are attached herewith.
MMTC'S PROMOTED PROJECT-Neelachal Ispat Nigam Ltd. (NINL)
Your company has set up Neelachal Ispat Nigam Limited (NINL) - an iron
& steel plant of 1.1 million tonnes capacity, 0.8 million tonne coke
oven and by product unit with captive power plant, jointly with Govt.
of Orissa. The project has been granted Iron ore mining lease with an
estimated reserves of 110 million tons. The phase-II of the Project
(Steel making facilities) with an estimated cost of Rs.18,550 million
is in the verge of completion & is likely to commence trial production
shortly. During the year 2011-12, NINL achieved a sales turnover of
Rs.20,558.06 million which includes export of 328,771 tonnes of pig
iron worth Rs. 7,925.10 million, domestic sales of 247,429 tonnes of
pig iron valued at Rs 6,527.20 million and 88,409 tonnes of BF coke
valued at Rs. 2,358.30 million. During the year 2011-12 NINL generated
a cash profit and net profit of Rs. 1,377.50 million and Rs. 294.50
million respectively
Future Projects/ Joint Ventures
To evolve a new business model for taking advantage of new
opportunities emerging in the free market environment, your company has
promoted a number of joint ventures following the public- private
partnership route. These value multiplier initiatives are briefed
hereunder:
(i) Your company had promoted a Commodity Exchange under the name and
style of "Indian Commodity Exchange Limited" which commenced operations
in November 2009. The said exchange has reported a net loss of Rs.
25.56 crores during the fiscal ended 31.3.2012.
(ii) Your company has participated in the equity of a Currency Futures
Exchange under the name and style of "United Stock Exchange of India
Ltd." which deals in currency futures and options for pairs like
rupee-dollar, rupee-yen, rupee-sterling pound and rupee-euro. The said
Currency Futures Exchange has commenced operations in September 2010
and has reported a loss of Rs. 4.57 crores for the year 2011-12 with a
cumulative loss of Rs.37.84 crores
(iii) Your company has joined hands with an international producer as a
joint venture partner for setting up a gold/silver medallion
manufacturing unit, which would also include a gold refinery as an
integral part, under the name and style of "MMTC-Pamp India Private
Limited". The said medallion manufacturing unit has since commenced
commercial production in April 2011. M/s MMTC-Pamp India Private
Limited has reported a net loss of Rs. 22.05 crores during the fiscal
ended 31.3.2012
(iv) For effective marketing of the finished products from above unit,
as well as jewellery from other sources, your company has set up in
partnership with a leading Indian company, a chain of retail stores at
various cities in India for medallions, jewellery and its homegrown
brand of 'SANCHI' silverware. Towards this end a special purpose
vehicle (SPV) under the name and style of "MMTC-Gitanjali Private
Limited" has been incorporated and retail outlets have already been
opened in various cities/ towns in India. M/s MMTC-Gitanjali Private
Limited has reported a net profit of Rs.0.12 crores during the fiscal
ended 31.3.2012
(v) Your company had set up a permanent berth with loading facilities
for iron ore at Ennore Port jointly with SICAL and L&T Infrastructure
Ltd. under the name and style of M/s. SICAL Iron Ore Terminals Limited
(SIOTL). The berth is operationally ready since October 2010 but due to
non- availability of iron ore for exports due to ban on exports of iron
ore of Karnataka origin, the terminal has not been operationalized as
yet. SIOTL has approached Ennore Port Ltd with a proposal to convert
the facility from iron ore loading to coal unloading, who in turn have
forwarded the proposal to Ministry of Shipping, Govt of India for its
approval.
(vi) Your company had participated in development of a deep draught
iron ore loading berth at Paradeep Port (Orissa) jointly with Noble
Group Ltd. and Gammon Infrastructure Projects Ltd. under the name and
style of M/s. Blue Water Iron Ore Terminal Private Ltd. The Paradeep
port
Trust has obtained the forest clearance for the project only in July
2012 and has sought confirmation of BWIOTL for its acceptance. However
in view of inordinate delay & consequential steep increase in the
project cost, BWIOTL has decided to shelve the project and has sought
approval of the same from all its shareholders.
(vii) Towards investing in mining exploration your Company has set up a
joint venture company with M/s. TATA Steel Ltd. under the name and
style of TM Mining Ltd.(TMML) for exploration and development of mines
for minerals, ferrous and non-ferrous ores, precious metals, diamonds
and coal etc., both in India and abroad. The company is continuously
making efforts to explore possibilities and studying various proposals
to identify suitable mines for exploration, erecting related projects
etc.
(viii) To facilitate promotion of two-way trade, the SPV promoted by
your Company in association with IL&FS has been allotted land to set up
free trade and warehousing zones at Haldia and Kandla on lines similar
to Special Economic Zones. To facilitate the same, process to induct
strategic partner in the projects has been initiated.
(ix) Your company has been allotted a coal mine in the Jharkhand State
having estimated reserves of about 287 million tonnes. Prospecting
license for the same has since been issued by the concerned authorities
and the pre-feasibility study completed. The work of detailed
exploration in conformity with Govt of India norms is being awarded
shortly. Your company has also signed an MOU with M/s Singareni
Collieries Ltd, (A Govt of India Enterprise) for joint mining of coal
from the said coal block.
INDUSTRIAL RELATIONS & HUMAN RESOURCE MANAGEMENT
Cordial and harmonious industrial relations continued to prevail in
your company with no man-days lost during the year. Regular meetings
were held with the Unions / Associations/ Federation for attaining an
amicable resolution of HR related issues to achieve Company's goals and
objectives.
The aggregate manpower of the company as on 31st March 2012 stood at
1,673, including four Board level executives, the balance comprising of
603 Officers and 1,066 staff. This includes 18 officers, 168 staff /
workers of erstwhile Mica Trading Company Ltd., which had been merged
with your company pursuant to the orders of BIFR. While the composite
representation of the total manpower consisted of women employees
representing 19.44% (325 employees) of the total manpower, the
representation of SC, ST, OBC & persons with disabilities (PWD) was to
the extent of 21.54% (360 employees), 8.07% (135 employees), 2.03% (34
employees) and 1.97% (33 employees) respectively. During the year 19
officers were inducted through campus recruitment. Presidential
Directives on reservations for SCs, STs, OBCs and PWD in services were
followed fully in recruitment and promotion.
Aiming towards further enhancing / upgrading the skills of employees in
the constantly changing business scenario 979 employees were imparted
training during the year in different spheres of company's activities.
This was done through programmes organized both with in-house expertise
as well as external resources from renowned institutions /
organizations. The employees deputed for training included 89 employees
belonging to SC, 47 to ST and 153 women employees. In terms of man-days
such training works out to 2,418 training man-days during the year
2011-12.
IMPLEMENTATION OF OFFICIAL LANGUAGE
Your Company is committed to uphold Official Language Policy of the
Government. During the year 2011-12, your company consistently strived
to adhere and implement the Official Language Policy to meet the
targets given in the annual programme issued by the Department of
Official Language, Ministry of Home Affairs, govt. of India. Towards
this and to promote usage of the Official Language by employees of the
company, several programs in the form of Hindi Workshops, Hindi Week/
Fortnight were organized at the Corporate Office and Regional Offices.
During the year, the Company had the privilege of interacting with the
Parliamentary Committee on Official Languages, which inspected your
company's Goa Regional Office whereat the Hon'ble Committee gave
valuable suggestions with regard to the implementation of the Official
Language Policy in MMTC.
VIGILANCE
Continuing to foster the goodwill & confidence stemming from value
based business practices and strengthening the Company as a
professionally managed, globally competitive & internationally reputed
organization, the vigilance group of your company carried further its
focus on preventive vigilance. During the year regular inspections
were conducted by vigilance & non-vigilance officers and based on the
feedback received, corrective/ preventive measures were suggested.
Special emphasis was also laid on updation of trade related drills/
manuals and suggesting systemic improvements in the areas related to
e-tendering, KYC norms, creation of price monitoring cell,
implementation of integrity pact, whistle blower policy and preparation
of vigilance manual
During the year under report Vigilance group of your Company was also
instrumental in organizing "Vigilance Awareness Week" in various
offices of MMTC from 30th October 2011 to 5th November 2011 whereat
stress was laid upon "participative vigilance". 'Integrity Pact' was
adopted as the in house theme in MMTC during the "Vigilance awareness
week-2011".
Your company has made an extraordinary ad-hoc provision of Rs 1,002.05
million in the accounts for the year ended 31st March 2012 against
amount recoverable from debtors pertaining to previous years arising on
account of certain acts of commission and omission at your company's
Regional Office, Chennai relating to Bullion transactions. Your company
has ordered a special audit for the years 2007-08 to 2010-11 which is
being conducted through a firm of Chartered Accountants. A reference in
the matter has been made to Central Vigilance Commission. A FIR has
been filed by your company with CBI. Two separate cases no. RC MA1
2012A 0024 and RC MA1 2012A 25 have been registered by the CBI in the
matter. Also Directorate of Enforcement has registered an offence under
Prevention of money Laundering Act 2002 against two ex- officials of
MMTC and the debtors from whom the amounts are recoverable by your
company.
CORPORATE SOCIAL RESPONSIBILITY
Your Company has been a constructive partner in the communities in
which it has operated since its inception in 1963, embracing
responsibility and encouraging a positive impact on the environment,
communities, stakeholders and the society at large. However, Corporate
Social Responsibility was adopted as a Corporate Policy in the year
2006-07 which was subsequently aligned to the CSR Guidelines laid down
by the Department of Public Enterprises in 2009-10. During 2011-12,
your company's CSR activities have been further aligned to the
"Millennium Development Goals" laid down by the Govt of India which
include eradication of extreme hunger and poverty, achieve universal
primary education, promote gender equality and empower women, ensure
environmental sustainability and develop a global partnership for
development. During 2011-12, Rs.30.00 million and Rs.4.5 million were
spent by MMTC Ltd on CSR and SD activities respectively.
CORPORATE GOVERNANCE
Corporate governance is an area of major significance not only to
governments and business but to all who are affected by organizations
in some way, whether as investors, directors, employees, suppliers,
customers or the community in general. Your Company reposes its firm
faith in continuous development, adoption and dedication towards the
best corporate governance practices.
A separate report on corporate governance along with Statutory Auditor
certificate regarding compliance of the stipulations relating to
corporate governance specified in clause 49 of the listing agreement(s)
signed with stock exchanges is annexed to and forms part of this
report.
CODE OF CONDUCT
Pursuant to Clause 49 (I)(D) of the Listing Agreement signed with Stock
Exchanges, a detailed Code of Conduct for Board Members and Senior
Management Personnel has been laid down and hoisted on the website of
your company. All Board Members and Senior Management Personnel, except
one General Manager (under suspension) on the regular rolls of the
company as on 31st March 2012, to whom the said Code is applicable have
affirmed compliance of the same for the period ended 31st March 2012.
The said defaulting official has since been removed from the services
of MMTC.
PUBLIC DEPOSIT SCHEME
As on 1st April 2012, there were no outstanding public deposits and the
company did not invite/ accept any public deposit during the year ended
31st March 2012.
STATUTORY AUDITOR'S REPORT
The Statutory Auditors have not given any comments having an impact on
the profit for the year 2011-12. Applicable disclosures have been made
in the 'notes forming part of accounts' in respect of other
observations contained in the report of statutory Auditors, as annexed,
which have no financial impact on the profit for the year 2011-12.
COMMENTS OF COMPTROLLER & AUDITOR GENERAL OF INDIA
The comments of Comptroller & Auditor General of India(C&AG) under
section 619(4) of the Companies Act, 1956 on the accounts of the
Company for the year ended 31.03.2012 are still to be received and the
same along with management's reply on the comments, if any, shall be
placed on the table at the ensuing AGM.
CONSERVATION OF ENERGY
During the year 2011-12, there was no activity in Mica group of your
company. Pursuant to Section 217(i)(e) of the Companies Act, 1956, a
statement on conservation of energy is annexed to this report.
PARTICULARS OF EMPLOYEES
Pursuant to provisions of section 217(2A) of the Companies Act, 1956
read with the Companies (Particulars of Employees) Rules, 1975, as
amended from time to time, it is stated that there were no employees
who were in receipt of remuneration exceeding Rs.60 lakhs per annum or
Rs. 5.00 lakhs per month during the year 2011-12.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 217(2AA) of the Companies Act,
1956, your Directors state:
i) That in the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
ii) That the Directors had selected such accounting policies and
applied them consistently and made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
profit of the Company for the year ended 31.3.2012;
iii) That the Directors have taken a proper and sufficient care for the
maintenance of the adequate accounting records in accordance with the
provisions of Companies Act, 1956 for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities;
iv) That the Directors have prepared the annual accounts on a going
concern basis.
BOARD OF DIRECTORS
Following are the changes in the Board of Directors of your company
since 1st April 2011: -
- Smt. Vijaylaxmi Joshi, Additional Secretary, Department of Commerce,
MOC&I assumed the additional charge of Chairman-cum-Managing Director
w.e.f. 22nd July 2011.
- Shri H S Mann relinquished the charge of Director (Marketing) &
additional charge of Chairman & Managing Director on 22nd July 2011.
- Shri Anil Razdan took over the charge of Part Time Non-official
(Independent) Director on the Board of MMTC w.e.f. 13th July 2011.
- Shri S Krishnan held the charge of Part Time Non-official
(Independent) Director on the Board of MMTC from 14th July 2011 till
18th October 2011.
- Shri G S Vedi took over the charge of Part Time Non-official
(Independent) Director on the Board of MMTC w.e.f. 14th July 2011.
- Shri Arun Balakrishnan took over the charge of Part Time Non-official
(Independent) Director on the Board of MMTC w.e.f. 16th July 2011.
- Shri P K Chaudhery, relinquished the charge of Part Time Govt Nominee
Director on the Board of MMTC w.e.f. 14th November 2011.
- Shri M G Gupta assumed the charge of Director (Finance) on the Board
of MMTC w.e.f. 9th December 2011.
- Shri Madhusudan Prasad Additional Secretary, Department of Commerce,
Ministry of Commerce & Industry took over as Part Time Govt Nominee
Director on the Board of MMTC w.e.f. 3rd January 2012.
- Dr Rajan Katoch, relinquished the charge of Part Time Govt Nominee
Director on the Board of MMTC w.e.f. 22nd May 2012.
- Smt Anita Agnihotri Additional Secretary & Financial Advisor,
Department of Commerce, Ministry of Commerce & Industry took over as
Part Time Govt Nominee Director on the Board of MMTC vice Dr Rajan
Katoch w.e.f. 22nd May 2012.
- Shri Anil Baijal, relinquished the charge of Part Time Non-official
(Independent) Director on the Board of MMTC w.e.f. 11th June 2012.
- Shri H L Zutshi relinquished the charge of Part Time Non-official
(Independent) Director on the Board of MMTC w.e.f. 11th June 2012.
- Smt Aruna Makhan relinquished the charge of Part Time Non-official
(Independent) Director on the Board of MMTC w.e.f. 14th June 2012.
- Shri Anand Trivedi assumed the charge of Director (Marketing) on the
Board of MMTC w.e.f. 3rd July 2012.
The Board places on record its deep appreciation for the commendable
services and the contributions made by Shri H S Mann, Shri Anil Baijal,
Shri S Krishnan, Shri P K Chaudhery, Dr Rajan Katoch, Shri H L
Zutshi,and Smt Aruna Makhan towards effective discharge of the
functions of the Board and its Committees. The Board also welcomes Smt
Vijaylaxmi Joshi, Shri Anil Razdan, Shri Madhusudan Prasad, Smt Anita
Agnihotri, Shi Arun Balakrishnan, Shri G S Vedi, Shri M G Gupta and
Shri Anand Trivedi and expresses confidence that the Company shall
immensely benefit from their rich and varied experience.
In terms of provisions of Article 87(4)(A) of Articles of Association
of the Company regarding rotational retirement of Directors, Shri Ved
Prakash, Director (Marketing), Shri Rajeev Jaideva, Director
(Personnel), Shri Anil Razdan, Non Official Part time Director and Shri
G S Vedi, Non Official Part time Director, shall retire at the AGM and
being eligible have offered themselves for reappointment.
ACKNOWLEDGEMENTS
Your Directors would like to acknowledge and place on record their
sincere appreciation of all stakeholders- shareholders, Department of
Commerce, all Govt. Agencies, RBI and other Banks, Railways, Customs,
Ports, NMDC, Customers, Suppliers and other business partners for the
excellent support and cooperation received from them during the year.
Your Directors also recognize and appreciate the efforts and hard work
of all the employees of the Company and their continued contribution to
its progress.
By the Order of the Board
sd/-
Place: New Delhi (Vijaylaxmi Joshi)
Dated: 28.08.2012 Chairman-cum-Managing Director
Mar 31, 2011
The Members
MMTC Limited, New Delhi.
Ladies & Gentlemen,
On behalf of Board of Directors, I have pleasure in presenting 48th
Annual Report on the performance of your company for the financial year
ended 31st March 2011 along with audited statements of accounts,
Auditor's Report & Review of Accounts by the Comptroller and Auditor
General of India.
RESULTS OF OPERATIONS
Your Company recorded its highest ever topline consecutively for the
seventh year. Your company achieved record level business turnover of
Rs. 688,545 million during 2010-11 registering a growth of over 53%
over the previous year. This best ever business turnover since MMTC's
inception in 1963 includes Exports of Rs. 36,934 million, highest ever
Imports of Rs. 633,008 million and domestic trade of Rs. 18,603
million. The other trade related earnings contributed Rs. 2,015
million. The trading profit earned by your Company stood at Rs. 3,300
million as against Rs 3,176 million during last year. The net profit
earned by your company during 2010-11 amounted to Rs. 1,216 million
The highlights of the Company's performance during 2010-11 are as
below: -
(Rs. in million)
2009-10 2010-11
Exports 32,228 36,934
Imports 399,690 633,008
Domestic 19,324 18,603
Other trade earnings 1,397 2,015
Net Sales/ Trading Earnings 452,639 690,560
Trading profit 3,176 3,300
Profit Before Taxes 3,331 1,918
Profit after Taxes 2,162 1,216
Dividend
(i) Proposed Dividend 450 250
(ii) Dividend Tax 75 41
Reserves and Surplus 12,371 12,797
The performance of different business groups of your Company is
highlighted in the Management Discussions and Analysis Report, which is
annexed and forms part of this Report.
AWARDS & RANKINGS
Following Awards and Rankings were conferred on your Company during
2010-11:
- CAPEXILÃs award for Highest Export in Minerals and Ores Sector for
the year 2009-10(19th time in a row).
- ÃTop Exporters for the year 2008-09,Gold Trophy(Merchant Exporter)Ã
by EEPC(Northern Region).
- Dun & Bradstreet (D&B) and Rolta Corporate Award 2010 in Trading
Sector.
- Ranked 4th by Business Today in their publication ÃBT 500 - 2010
Public Sector Companiesà .
- Ranked 8th by Dun & Bradstreet in their publications ÃIndiaÃs Top 500
Companies 2010Ã and ÃIndiaÃs Top PSUs 2011Ã
- Ranked 11th by Business Standard in their publication ÃBS1000Ã
released in March 2011.
EQUITY SHARE CAPITAL & DIVIDEND
During the year under report equity shares of your company of face
value Rs.10/- each were sub- divided into ten shares of face value
Re.1/- each. Also, Bonus Shares in the ratio of 1:1 were issued on 5th
August 2010. This resulted in increase of the equity capital of your
company from Rs.500 million comprising of 50 million shares of Rs.10/-
each to Rs.1000 million comprising of 1000 million shares of Re.1/-
each. The Board of Directors recommends declaration of dividend of 25%
on the enhanced post Bonus equity capital of the Company for the year
2010-11.
RESERVES
A sum of Rs. 12,371.47 million was available in the reserves and
surplus of your Company as on 1st April 2010. During the year 2010-11
an amount of Rs. 500 million was withdrawn from the reserves for
issuance of bonus shares in the ratio of 1:1. Your Directors have
proposed that out of Rs.925.88 million available out of the profits for
the year 2010-11, after payment of dividend and tax thereon, an amount
of Rs.130 million be transferred to General Reserves of the Company and
balance profit of Rs.795.88 million be carried forward as retained
profits. Accordingly an amount of Rs.12,797.35 million shall be
available in "Reserves and Surplus" of your Company as on 31st March
2011.
SUBSIDIARY COMPANY
The wholly owned subsidiary of your Company - MMTC Transnational Pte.
Ltd. Singapore (MTPL) was incorporated in October 1994 under the laws
of Singapore with a share capital of USD 1 million. During the year
2010-11, MTPL achieved its best business turnover of USD 710 million,
since its inception. The Profit after tax earned by MTPL during
2010-11 amounted to USD 2.32 million. The net worth of MTPL stood at
USD 18.23 million as on 31st March 2011. MTPL has so far paid total
dividends of US$ 8.27 million as against capital of US$ 1 million
contributed by your company besides multiplying its net worth by over
18 times since its inception.
MTPL continues to enjoy prestigious "Global Trader" (GT) status awarded
to it by International Enterprise Singapore since FY 2000.
Pursuant to the provisions of Section 212 of the Companies Act, 1956,
the audited financial statements of MTPL together with Director's
Report & Auditor's report are attached herewith.
MMTC'S PROMOTED PROJECT-Neelachal Ispat Nigam Ltd. (NINL)
Your company had set up Neelachal Ispat Nigam Limited (NINL) - an iron
& steel plant of 1.1 million tonnes capacity, 0.8 million tonne coke
oven and by product unit with captive power plant, jointly with Govt.
of Orissa. The project has firm Iron ore supply linkages and also has
captive Iron ore mining rights for reserves estimated at about 150
million tons. The construction of phase-II of the Project (Steel making
facilities) with an estimated cost of Rs.18,550 million is in advance
stages & is likely to commence trial production by end of current
financial year. During the year 2010-11, NINL achieved a sales turnover
of Rs.16,158 million which includes export of 405,900 tonnes of pig
iron worth Rs. 8,237 million, domestic sales of 114,491 tonnes of pig
iron valued at Rs 2,553 million and 156,277 tonnes of BF coke valued at
Rs. 2,814 million.
Future Projects/ Joint Ventures
Aiming at diversification and with a view to add value to its existing
trading operations, your Company has participated in various joint
ventures under public- private partnership route. These value
multiplier initiatives to enhance your companyÃs future sustainability
are briefed hereunder:
(i) Your company has promoted a Commodity Exchange under the name and
style of "Indian Commodity Exchange Limited" which has since commenced
operations in November 2009.
(ii) Your company is participating in the equity of a Currency Futures
Exchange under the name and style of "United Stock Exchange of India
Ltd." which has commenced operations in September 2010.
(iii) Your company has joined hands with an international producer as a
joint venture partner for setting up a gold/silver medallion
manufacturing unit, which would also include a gold refinery as an
integral part, under the name and style of "MMTC-Pamp India Private
Limited". The civil construction activities for medallion manufacturing
unit in Haryana have already been completed and the medallion
manufacturing unit commenced trial production in February 2011. The
said medallion manufacturing unit has since commenced commercial
production in April 2011.
(iv) For effective marketing of the finished products from above unit,
as well as jewellery from other sources, your company is setting up, in
partnership with a leading Indian company, a chain of retail stores at
various cities in India for medallions, jewellery and its homegrown
brand of 'SANCHI' silverware. Towards this end a special purpose
vehicle (SPV) under the name and style of "MMTC-Gitanjali Private
Limited" has been incorporated and 17 retail outlets have already been
opened in various cities/ towns in India.
(v) Your company has set up a permanent berth with loading facilities
for iron ore at Ennore Port jointly with SICAL and L&T Infrastructure
Ltd. under the name and style of M/s. SICAL Iron Ore Terminals Limited.
The berth is operationally ready since October 2010 but due to ban on
exports of iron ore by Karnataka State Govt. the terminal has not been
formally commissioned as yet. Once exports resume, the terminal will
provide an important outlet for such exports.
(vi) Your company is also developing a deep draught iron ore loading
berth at Paradeep Port (Orissa) jointly with Noble Group Ltd. and
Gammon Infrastructure Projects Ltd. under the name and style of M/s.
Blue Water Iron Ore Terminal Private Ltd. The project is in the initial
phase and is expected to commence construction by end of the current
calendar year after forest clearance has been received from the
authorities concerned.
(vii) Towards investing in mining exploration your Company has set up a
joint venture company with M/s. TATA Steel Ltd. under the name and
style of TM Mining Ltd. for exploration and development of mines for
minerals, ferrous and non-ferrous ores, precious metals, diamonds and
coal etc., both in India and abroad.
(viii) To facilitate promotion of two-way trade, the SPV promoted by
your Company in association with IL&FS has been allotted land to set up
free trade and warehousing zones at Haldia and Kandla on lines similar
to Special Economic Zones. To facilitate the same, process to induct
strategic partner in the projects has been initiated.
(ix) Your company has been allotted a coal mine in the Jharkhand State
having estimated reserves of about 700 million MT. Prospecting license
for the same has since been issued by the concerned authorities and the
pre-feasibility study completed. Actions for further exploration of the
coal block for preparing geological report /mining plans has since been
initiated.
INDUSTRIAL RELATIONS & HUMAN RESOURCE MANAGEMENT
Cordial and harmonious industrial relations continued to prevail in
your company with no man-days being lost during the year. Regular
meetings were held with the Unions / Associations for arriving at
amicable resolution of personnel issues with a view to achieve
CompanyÃs goals and objectives.
The aggregate manpower of the company as on 31st March 2011 stood at
1,767, including five Board level executives, the balance comprising of
584 Officers, 1094 staff and 84 workers. This includes 20 officers, 126
staff & 84 workers of erstwhile Mica Trading Company Ltd., which had
been merged with your company pursuant to the orders of BIFR. While the
composite representation of the total manpower consisted of women
employees representing 18.68% (330 employees) of the total manpower,
the representation of SC, ST, OBC & persons with disabilities (PWD) was
to the extent of 21% (371 employees), 7.53% (133 employees), 1.75% (31
employees) and 1.87% (33 employees) respectively. During the year 21
officers were inducted through campus recruitment. Presidential
Directives on reservations for SCs, STs, OBCs and PWD in services were
followed fully in recruitment and promotion.
Aiming towards further enhancing / upgrading the skills of employees in
the constantly changing business scenario 1,251 employees were imparted
training during the year in different spheres of companyÃs activities.
This was done through programmes organized both with in-house expertise
as well as external resources from renowned institutions /
organizations. The employees deputed for training included 182
employees belonging to SC, 81 to ST and 313 women employees. In terms
of man-days such training works out to 2,197 training man-days during
the year 2010-11.
IMPLEMENTATION OF OFFICIAL LANGUAGE
Your Company is committed to uphold Official Language Policy of the
Government. During the year 2010-11, your company consistently strived
to adhere and implement the Official Language Policy and meet the
targets given in the annual programme issued by the Department of
Official Language, Ministry of Home Affairs, govt. of India. Towards
this and to promote usage of the Official Language by employees of the
company, several programs in the form of Hindi Workshops, Hindi Week/
Fortnight were organized at the Corporate Office and Regional Offices.
During the year the Company had the privilege of interacting with the
Drafting and Evidence Sub- Committee of the Committee of Parliamentary
on Official Languages when it inspected SRO Cochin of your company.
VIGILANCE
To enhance the goodwill & confidence emanating from value based
business practices, the Vigilance group of your company carried further
its focus on system improvement and preventive vigilance. An annual
calendar of vigilance inspections was prepared by the group well in
advance to ensure systematic and regular vigilance inspections. During
the year regular inspections were conducted by vigilance &
non-vigilance officers and based on the feedback received, corrective/
preventive measures were suggested. Special emphasis was also laid on
updation of trade related drills/ manuals, streamlining of tendering
and other procedures in line with the guidelines issued by Central
Vigilance Commission
During the year under report Vigilance group of your Company was also
instrumental in organizing ÃVigilance Awareness Weekà in various
offices of MMTC in November 2010 whereat stress was laid upon
increasing vigilance awareness amongst employees and business
associates, to bring enhanced transparency in public dealings.
CORPORATE SOCIAL RESPONSIBILITY
Your Company has been a responsible corporate citizen since its
inception in 1963, responding through resources and manpower in times
of need. Corporate Social Responsibility was adopted as a Corporate
Policy in the year 2006-07 with specific guidelines. The focus being
education, health care, promotion of art & culture and community
activities including relief in times of natural calamities. The CSR
Policy was subsequently aligned to the CSR Guidelines laid down by the
Department of Public Enterprises in 2009-10. Your companyÃs CSR focus
during 2010-11 was on building educational infrastructure for deprived
sections of society and tsunami affected areas, literacy promotion,
facilitating computer education and creating drinking water & health
care facilities. In addition, your company also contributed towards the
promotions of sports, art & culture. During this period sustainable
development initiatives like afforestation at Bellary (Karnataka) and
Jajpur & Baril (Odisha) by planting saplings and construction of two
check dams to facilitate irrigation in Jajpur District (Odisha) were
also undertaken. A total of Rs. 36.15 million was spent on these
initiatives during the year.
CORPORATE GOVERNANCE
Corporate governance is an area of major significance not only to
governments and business but to all who are affected by organizations
in some way, whether as investors, directors, employees, suppliers,
customers or the community in general. Your Company reposes its firm
faith in continuous development, adoption and dedication towards the
best corporate governance practices.
A separate report on corporate governance along with Statutory Auditor
certificate regarding compliance of the stipulations relating to
corporate governance specified in clause 49 of the listing agreement(s)
signed with stock exchanges is annexed to and forms part of this
report.
CODE OF CONDUCT
Pursuant to Clause 49 (I)(D) of the Listing Agreement signed with Stock
Exchanges, a detailed Code of Conduct for Board Members and Senior
Management Personnel has been laid down and hosted on the website of
your company. All Board Members and Senior Management Personnel (except
one) on the regular rolls of the company as on 31st March 2010, to whom
the said Code is applicable have affirmed compliance of the same for
the period ended 31st March 2011. Action against the one defaulting
General Manager (under suspension) is in progress.
PUBLIC DEPOSIT SCHEME
As on 1st April 2010, there were no outstanding public deposits and the
company did not invite/ accept any public deposit during the year ended
31st March 2011.
STATUTORY AUDITORÃS REPORT
The Statutory Auditors have not given any comments having an impact on
the profit for the year 2010- 11. Applicable disclosures have been made
in the Ãnotes forming part of accountsà in respect of other
observations contained in the report of statutory Auditors, as annexed,
which have no financial impact on the profit for the year 2010-11.
COMMENTS OF COMPTROLLER & AUDITOR GENERAL OF INDIA
The Comptroller & Auditor General of India(C&AG) has given ÃNilÃ
comments under section 619(4) of the Companies Act, 1956 on the
accounts of the Company for the year ended 31.03.2011.The communication
dated 17th August 2011 of C & AG in this regard is annexed herewith.
CONSERVATION OF ENERGY
During the year 2010-11, there was no activity in Mica group of your
company. Pursuant to Section 217(i)(e) of the Companies Act, 1956, a
statement on conservation of energy is annexed to this report.
PARTICULARS OF EMPLOYEES
Pursuant to provisions of section 217(2A) of the Companies Act, 1956
read with the Companies (Particulars of Employees) Rules, 1975, as
amended from time to time, it is stated that there were no employees
who were in receipt of remuneration exceeding Rs.60 lakhs per annum or
Rs. 5.00 lakhs per month during the year 2010-11.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 217(2AA) of the Companies Act,
1956, your Directors state:
i) That in the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
ii) That the Directors had selected such accounting policies and
applied them consistently and made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
profit of the Company for the year ended 31.3.2011;
iii) That the Directors have taken a proper and sufficient care for the
maintenance of the adequate accounting records in accordance with the
provisions of Companies Act, 1956 for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities;
iv) That the Directors have prepared the annual accounts on a going
concern basis.
BOARD OF DIRECTORS
Following are the changes in the Board of Directors of your company
since 1st April 2010:- - Shri S K Kar relinquished the charge of Whole
Time Director (Finance) on 30th June 2010 on superannuation.
- Shri A Mahapatra relinquished the charge of Whole Time Director
(Personnel) on 30th July 2010 on superannuation.
- Shri Sanjiv Batra relinquished the charge of Chairman & Managing
Director on 30th September 2010 on superannuation.
- Shri H S Mann, Director (Marketing) assumed the additional charge of
CMD w.e.f. 6th October, 2010 until 22nd July 2011
- Dr S Behuria, relinquished the charge of part-time Director on the
Board of MMTC and Shri Saurabh Chandra AS&FA, DIP&P & Department of
Commerce, Ministry of Commerce & Industry took over as part time
Director on the Board of MMTC vice Dr S Behuria w.e.f. 6th October
2010.
- Shri Saurabh Chandra, relinquished the charge of part-time Director
on the Board of MMTC and Dr. Rajan Katoch, AS& FA, Department of
Commerce, Ministry of Commerce & Industry took over as part time
Director on the Board of MMTC vice Shri Saurabh Chandra w.e.f.7th
December 2010.
- Shri Rajeev Jaideva took over the charge of Whole Time Director
(Personnel) on the Board of MMTC w.e.f. 3rd December 2010.
- Shri Anil Razdan took over the charge of Part Time Non-official
(Independent) Director on the Board of MMTC w.e.f. 13th July 2011.
- Shri S Krishnan took over the charge of Part Time Non-official
(Independent) Director on the Board of MMTC w.e.f. 14th July 2011.
- Shri G S Vedi took over the charge of Part Time Non-official
(Independent) Director on the Board of MMTC w.e.f. 14th July 2011.
- Shri Arun Balakrishnan took over the charge of Part Time Non-official
(Independent) Director on the Board of MMTC w.e.f. 16th July 2011.
- Shri H S Mann relinquished the charge of Director(Marketing) &
additional charge of Chairman & Managing Director on 22nd July 2011.
- Smt Vijaylaxmi Joshi, Additional Secretary, Department of Commerce,
MOC&I assumed the additional charge of Chairman-cum-Managing Director
w.e.f. 22nd July 2011 vice Shri H S Mann.
The Board places on record its deep appreciation for the commendable
services and the contributions made by Dr S Behuria, Shri Saurabh
Chandra, Shri Sanjiv Batra, Shri S K Kar, Shri A Mahapatra and Shri H S
Mann towards effective discharge of the functions of the Board and its
Committees. The Board also welcomes Smt Vijaylaxmi Joshi, Dr. Rajan
Katoch, Shri Rajeev Jaideva, Shri Anil Razdan, Shri S Krishnan, Shri G
S Vedi & Shri Arun Balakrishnan and expresses confidence that the
Company shall immensely benefit from their rich and varied experience.
In terms of provisions of Article 87(4)(A) of Articles of Association
of the Company regarding rotational retirement of Directors, Smt Aruna
Makhan, Non Official Part time Director, Shri P K Chaudhery, Govt
Nominee Part time Director, Shri Ved Prakash, Director (Marketing) and
Shri Anil Baijal, Non Official Part time Director, shall retire at the
AGM and being eligible have offered themselves for reappointment.
ACKNOWLEDGEMENTS
Your Directors would like to acknowledge and place on record their
sincere appreciation of all stakeholders- shareholders, Department of
Commerce, all Govt. Agencies, RBI and other Banks, Railways, Customs,
Ports, NMDC, Customers, Suppliers and other business partners for the
excellent support and cooperation received from them during the year.
Your Directors also recognize and appreciate the efforts and hard work
of all the employees of the Company and their continued contribution to
its progress.
By the Order of the Board
Sd/-
Place : New Delhi (Vijaylaxmi Joshi)
Dated : 18.08.2011 Chairman-cum-Managing Director
Mar 31, 2010
On behalf of Board of Directors, I have pleasure in presenting 47th
Annual Report on the performance of your Company for the financial year
ended 31 st March 2010 along with audited statements of accounts,
Auditors Report & Review of Accounts by the Comptroller and Auditor
General of India.
RESULTS OF OPERATIONS
Your Company exhibited outstanding performance in recording its highest
ever topline for the sixth consecutive year. Your company achieved
record level business turnover of Rs. 451,242 million during 2009-10
registering a growth of more than 22% over the previous year. This best
ever business turnover since MMTCs inception in 1963 includes exports
of Rs. 32,228 million, highest ever imports of Rs. 399,690 million and
domestic trade of Rs. 19,324 million The other trade related earnings
contributed Rs. 1397 million. The net profit of Rs. 2162 million earned
by your Company registered a growth of 54% over previous year and is
the highest ever net profit after tax earned by the Company in its
history.
This noteworthy performance is despite intense competition faced by the
Company in all its trade activities - both from local as well as
international players which put considerable pressure on margins. This
was responded to through growth in core operations by competitive
offering of products bundled with efficient services, as also by
successfully tapping new areas of business by innovative value
addition, aggressive marketing efforts and better utilization of
available resources.
The highlights of the Companys performance during 2009-10 areas
below:- (Rs in million)
2009-10 2008-09
Exports 32,228 45,759
Imports 399,690 306,951
Domestic 19,324 15,497
Other trade earnings 1,397 1,967
Net Sales/ Trading Earnings 452,639 370,174
Trading profit 3176 3209
Profit Before Taxes 3331 2174
Prof it after Taxes 2162 1402
Dividend
(i) Interim Dividend on Equity Shares - 200
(ii) Proposed Dividend 450 200
(iii) Dividend Tax 75 68
Reserves and Surplus 12371 10734
The performance of different business groups of your Company is
highlighted in the Management Discussion and Analysis Report, which is
annexed and forms part of this Report.
AWARDS & RANKINGS
Following Awards and Rankings were conferred on your Company during
2009-10:
1. MOU Excellence Award for the year 2007-08
2. All India Export excellence award (Silver Trophy) for the Year
2008-09 in Merchant Enterprise category by EEPC;
3. CAPEXIL highest award for Highest Export in Minerals and Ores
sector for the year 2008-09 (18th time in a row);
4. Ranked 5th by CAPITAL MARKET in their 2009 Compendium of TOP 500
Companies in India.
5. Top Indian Company in the Trading Sector by Dun & Bradstreet in
their rankings "Indias Top 500 companies 2009". In the same
publication your Company was ranked 11 th based on total income for the
year 2008-09.
6. Amity Excellence Award in the category "Wealth Creator of the Year"
for 2009-10.
7. Ranked 14th amongst Indias top Companies by "Business Standard" in
its publication "BS1000" released in February 2010.
8. Ranked 10th in the list of Indias Top PSUs 2010 released by Dun &
Bradstreet
DIVIDEND
The Board of Directors recommended declaration of dividend of 90% on
the pre-split and pre- Bonus equity capital of the Company for the year
2009-10.
RESERVES
A sum of Rs. 10734 million was available in the reserves and surplus of
your Company as on 1 st April 2009. Your Directors have proposed that
out of Rs.1637.64 million available out of the profits for the year
2009-10, after payment of dividend and tax thereon, an amount of Rs.220
million be transferred to General Reserves of the Company and balance
profit of Rs. 1417.64 million be carried forward as retained profits.
Accordingly an amount of Rs. 12371.47 million shall be available in
"Reserves and Surplus" of your Company as on 31st March 2010.
FOREIGN EXCHANGE EARNINGS AND OUTGO
The Foreign Exchange earnings and outgo of your Company during 2009-10
have been as under: -
EARNINGS OUTGO
Rs. In Million Rs. In Million
Exports 32247.14 Imports 405703.64
Others 226.15 Interest 362.63
Others 877.03
Total 32473.29 Total 406943.30
SUBSIDIARY COMPANY
The wholly owned subsidiary of your Company - MMTC Transnational Pte.
Ltd. Singapore (MTPL) was incorporated in October 1994 under the laws
of Singapore with a share capital of USD 1 million. During the year
2009-10, MTPL achieved its second best ever business turnover of USD
525 million & second highest Profit after tax of USD 6.54 million since
inception. The net worth of MTPL stood at USD 18.03 million as on 31 st
March 2010. MTPL has so far paid total dividends of US$ 6.15 million as
against capital of US$ 1 million contributed by your company, besides
multiplying its net worth by nearly 18 times since its inception.
MTPL continues to enjoy prestigious "Global Trader" (GT) status awarded
to it by International Enterprise. Singapore since FY 2000.
Pursuant to the provisions of Section 212 of the Companies Act, 1956,
the audited financial statements of MTPL together with Directors
Report & Auditors report are attached herewith.
MMTCS PROMOTED PROJECT - Neelachal Ispat Niqam Ltd. (NINL)
Your company had set up Neelachal Ispat Nigam Limited (NINL) - an iron
& steel plant of 1.1 million tonnes per annum capacity, 0.8 million
tonne coke ovens and by-product unit with captive power plant, jointly
with Govt, of Orissa. The project has firm Iron ore supply linkages and
also has captive Iron ore mining rights for reserves estimated at about
150 million tons. The construction of phase-lI of the Project with an
estimated cost of Rs. 18550 million is under progress.. During the year
2009-10, NINL achieved a sales turnover of Rs.15800 million and
generated net profit of Rs. 379 million. Future Projects/Joint
Ventures
Aiming at diversification and with a view to add value to its existing
trading operations, your Company has undertaken various strategic
initiatives following public- private partnership route. Brief details
of these value multiplier strategic initiatives to enhance your
Companys future sustainability are given below:
(i) Your Company has promoted a Commodity Exchange under the name and
style of "Indian Commodity Exchange Limited" which has since commenced
operations in November 2009.
(ii) Your Company is participating in the equity of a Currency Futures
Exchange under the name and style of "United Stock Exchange of India
Ltd." which is also likely to commence operations soon.
(iii) Your Company has joined hands with an international producer as a
joint venture partner for setting up a gold/silver medallion
manufacturing unit, which would also include a gold refinery as an
integral part, under the name and style of "MMTC-Pamp India Private
Limited". The civil construction activities for medallion manufacturing
unit located in Haryana are already 95% complete and the medallion
manufacturing unit is likely to commence trial production in the last
quarter of 2010 and commercial production in first quarter of 2011.
(iv) For effective marketing of the finished products from above unit,
as well as jewellery from other sources, your company is setting up, in
partnership with a leading Indian Company, a chain of retail stores at
various cities in India for sales of medallions, jewellery and its
homegrown brand of SANCHI silverware. Towards this end a special
purpose vehicle (SPV) under the name and style of "MMTC-Gitanjali
Private Limited" has been incorporated and 14 retail outlets have
already been opened in various cities/towns in India.
(v) Your Company is setting up permanent berth with loading facilities
for iron ore at Ennore Port jointly with SICAL and L&T Infrastructure
Ltd. under the name and style of M/s. SICAL Iron Ore Terminals Limited.
The permanent berth being constructed by M/s. SICAL Iron Ore Terminals
Limited is likely to be operational by end August 2010.
(vi) Your Company is also developing a deep draught iron ore berth al
Paradeep Port (Orissa) jointly with Noble Group Ltd. and Gammon
Infrastructure Projects Ltd. under the name and style of M/s. Blue
Water Iron Ore Terminal Private Ltd. The project is in the initial
phase and will be ready only towards end 2013.
(vii) Towards investing in mining exploration your Company has executed
a joint venture agreement with M/s. TATA Steel Ltd. for exploration and
development of mines for minerals, ferrous and non-ferrous ores,
precious metals, diamonds and coal etc., both in India and abroad.
(viii) To facilitate promotion of two-way trade, your Company is
setting up free trade and warehousing zones at Haldiaand Kandlaon lines
similarto Special Economic Zones.
(ix) Your Company has been allotted a coal mine in the Jharkhand State
having estimated reserves of about 700 million MT The prospecting
license for the said mine has since been issued by the concerned
authorities and pre-feasibility study commenced.
INDUSTRIAL RELATIONS & HUMAN RESOURCE MANAGEMENT
Cordial and harmonious industrial relations continued to prevail in
your Company with no man-days lost during the year. Regular meetings
were held with the Unions / Associations for arriving at amicable
resolution of personnel issues with a view to achieve Companys goals
and objectives.
The aggregate manpower of the company as on 31 st March 2010 stood at
1838, including six Board level executives, the balance comprising of
608 Officers, 1139 staff & 91 workers. This manpower strength includes
21 officers, 130 staffs 91 workers of erstwhile Mica Trading Company
Ltd., which had been merged with your company pursuant to the orders of
BIFR. While the composite representation of the total manpower
consisted of women employees representing 18.28% (336 employees) of the
total manpower, the representation of SC, ST, OBC & persons with
disabilities (PWD) was to the extent of 21.10% (388 employees), 7.29%
(134 employees), 1.41% (26 employees) and 1.68% (31 employees)
respectively. During the year 8 officers were inducted through campus
recruitment and 2 through lateral induction . Presidential Directives
on reservations for SCs, STs, OBCs and PWD in services were followed
fully in recruitment and promotion. In an effort for rightsizing the
manpower, Voluntary Retirement Scheme was offered which was availed by
10 officers, 11 staff cadre employees and 03 workers.
Aiming towards further enhancing / upgrading the skills of employees in
the constantly changing business scenario, 1270 employees were imparted
training during the year in different spheres of Companys activities.
This was done through programmes organized, both with in-house
expertise as well as external resources, by renowned institutions
/ organizations. The employees deputed for training included 221
employees belonging to SC, 70 to ST and 299 women employees. In terms
of man-days such training works out to 2773 training man-days during
the year 2009-10.
IMPLEMENTATION OF OFFICIAL LANGUAGE
Your Company is committed to uphold Official Language Policy of the
Government. Towards this and to promote usage of the Official Language
by employees of the Company, several programmes in the form of Hindi
workshops, Hindi seminars, Hindi Day/Week/Fortnight were organized at
the Corporate Office and Regional Offices.
During the year the Company had the privilege of interacting with the
Parliamentary Committee on Official Languages. This Committee
inspected/ visited corporate office & reviewed the measures/ steps
taken for implementation of the Official Language policy. The Honble
Committee expressed satisfaction on the steps/ measures taken and the
progress made in implementation of Official Language.
VIGILANCE
Continuing to foster the goodwill & confidence stemming from value
based business practices and strengthening the Company as a
professionally managed, globally competitive & internationally reputed
organization, the Vigilance group of your Company carried further its
focus on preventive vigilance by stepping up surprise inspections.
During the year 311 vigilance and 120 non-vigilance inspections were
conducted and based on the feedback received, corrective/ preventive
measures were suggested. An annual calendar of vigilance inspections
was prepared by the group well in advance to ensure systematic and
regular vigilance inspections. Special emphasis was also laid on
updation of trade related drills/ manuals, streamlining of tendering
and other procedures in line with the guidelines issued by Central
Vigilance Commission.
During the year under report Vigilance group of your Company was also
instrumental in organizing "Vigilance Awareness Week" in various
offices of MMTC in November 2009 whereat stress was laid upon
increasing vigilance awareness amongst employees and business
associates, to bring enhanced transparency in public dealings.
CORPORATE SOCIAL RESPONSIBILITY
Your Company had already adopted Corporate Social Responsibility as
Policy initiative in the year 2006-07. The main focus of the Companys
CSR policy is in the areas of infrastructure development, promotion of
literacy, health care, promotion of afforestation in mining areas and
relief & restoration in times of natural calamities in the vicinity of
MMTCs operations. Recently your Company has reoriented its CSR policy
in accordance with the guidelines issued by Department of Public
Enterprises on the subject.
CORPORATE GOVERNANCE
Corporate governance is an area of major significance for all those who
are affected by organizations directly or indirectly, whether as
investors, directors, employees, suppliers, customers or the community
in general. Your Company remains committed and dedicated to continuous
development and adoption of the best corporate governance practices,
which include honesty, trust and integrity, transparency, performance
orientation, responsibility and accountability, mutual respect, and
commitment to the organization.
A separate report on corporate governance along with Statutory
Auditors certificate regarding compliance of the stipulations relating
to corporate governance specified in clause 49 of the listing
agreement(s) signed with stock exchanges is annexed to and forms part
of this report.
CODE OF CONDUCT
Pursuant to Clause 49 (l)(D) of the Listing Agreement signed with Stock
Exchanges, a detailed Code of Conduct for Board Members and Senior
Management Personnel has been laid down and hosted on the website of
your Company. All Board Members and Senior Management Personnel
(except one) on the regular rolls of the Company as on 31 st March
2010, to whom the said Code is applicable have affirmed compliance of
the same for the period ended 31 st March 2010. Action against the one
defaulting General Manager is in progress.
PUBLIC DEPOSIT SCHEME
As on 1st April 2009, there were no outstanding public deposits and the
Company did not invite/ accept any public deposit during the year ended
31 st March 2010.
STATUTORY AUDITORS REPORT
The Statutory Auditors have not given any comments having an impact on
the profit for the year 2009-10. Applicable disclosures have been made
in the notes forming part of accounts in respect of other
observations contained in the report of statutory Auditors, as annexed,
which have no financial impact on the profit for the year 2009-10.
COMMENTS OF COMPTROLLER & AUDITOR GENERALOF INDIA
The Comptroller & Auditor General of India(CSAG) has given Nil
comments under section 619(4) of the Companies Act, 1956 on the
accounts of the Company for the year ended 31.03.2010.The communication
dated 26th July 2010 of C & AG in this regard is annexed herewith.
CONSERVATION OF ENERGY
During the year 2009-10, there was no activity in Mica group of your
company. Pursuant to Section 217(i)(e)ofthe Companies Act, 1956, a
statement on conservation of energy is annexed to this report.
PARTICULARS OF EMPLOYEES
Pursuant to provisions of section 217(2A) of the Companies Act, 1956
read with the Companies (Particulars of Employees) Rules, 1975, as
amended from time to time, a statement of the particulars of employees
who were in receipt of remuneration exceeding Rs.24 lakhs per annum or
Rs. 2.00 lakhs per month during the year 2009-10 is annexed to this
report.
DIRECTORSRESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 217(2AA) of the Companies Act,
1956, your Directors state:
i) That in the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
ii) That the Directors had selected such accounting policies and
applied them consistently and made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
profit of the Company for the year ended 31.3.2010;
iii) That the Directors have taken a proper and sufficient care for the
maintenance of the adequate accounting records in accordance with the
provisions of Companies Act, 1956 for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities;
Iv) That the Directors have prepared the annual accounts on a going
concern basis.
BOARD OF DIRECTORS
Mr. R Gopalan, relinquished the charge of part-time Director on the
Board of MMTC and Mr. P K Chaudhery AS, Department of Commerce,
Ministry of Commerce & Industry took over as part time Director on the
Board of MMTC vice Mr. R Gopalan w.e.f.14th January 2010.
Mr. Ved Prakash took over the charge of Whole Time Director (Marketing)
on the Board of MMTC w.e.f. 19th February 2010.
Mr. Adarsh R Goyal relinquished the charge of Whole Time Director
(Marketing) on 31 st December 2009 on superannuation.
Mr. S K Kar relinquished the charge of Whole Time Director (Finance) on
30th June 2010 on superannuation.
The Board places on record its appreciation for the commendable
services and the contributions made by Mr. R Gopalan, Mr. S K Kar and
Mr. Adarsh R Goyal towards effective discharge of the functions of the
Board and its Committees. The Board also welcomes Mr. P K Chaudhery &
Mr. Ved Prakash and expresses confidence that the Company shall
immensely benefit from their rich and varied experience.
In terms of provisions of Article 87(4)(A) of Articles of Association
of the Company regarding rotational retirement of Directors, Dr. S
Behuria, Director, Mr. Sunir Khurana, Director (Marketing), Mr. Anil
Baijal, Non Official Part time
Director and Mr. H L Zutshi, Non Official Part time Director shall
retire at the AGM and being eligible have offered themselves for
reappointment.
ACKNOWLEDGEMENTS
Your Directors are thankful to the Department of Commerce, all Govt.
Agencies, RBI and other Banks, Railways, Customs, Ports, NMDC,
Customers and Suppliers for their valuable support and cooperation
during the year. Your Directors also wish to place on record their deep
sense of appreciation for the committed services rendered by managers
and staff of your company without which it would not have been possible
to realize vastly improved business turnover and profit recorded during
the year.
By the Order of the Board
Sd/-
Place : New Delhi (Sanjiv Batra)
Dated: 28th July 2010 Chairman and Managing Director