Mar 31, 2016
DIRECTORSâ REPORT
The Directors have pleasure in presenting before you the 6th Annual Report of the Company together with the Audited Accounts for the year ended March 31, 2016.
The Financial Results and the Consolidated Financial Results of the company for the year ended March 31, 2016 are as under:
A. BUSINESS AND FINANCIAL HIGHLIGHTS
Standalone Financial Results:__ Rs. In Lakhs
Particulars |
2015 - 2016 current year |
2014 - 2015 previous year |
Net Sales/Income from Operations |
- |
- |
Other Income |
1.54 |
3.30 |
Total Expenditure |
||
a. (Increase)/Decrease in Stock |
- |
- |
b. Cost of materials consumed |
- |
- |
c. Employee benefits expense |
150.94 |
73.71 |
d. Purchase of traded products |
- |
- |
e. Power and fuel |
- |
- |
f. Other expenses |
167.98 |
484.33 |
Total |
318.92 |
558.04 |
Finance cost |
12.01 |
7.95 |
Depreciation and amortization |
2.12 |
2.12 |
Profit/ (Loss) before exceptional items, extra-ordinary items and tax |
(331.51) |
(564.81) |
Exceptional Items |
- |
40,000.00 |
Profit/ (Loss) before extra-ordinary items and tax |
(331.51) |
(40,564.81) |
Extra-ordinary items |
- |
- |
Profit/(Loss) before tax |
(331.51) |
(40,564.81) |
Provision for tax |
- |
- |
Deferred tax |
- |
- |
Profit / (Loss) after tax |
(331.51) |
(40,564.81) |
Dividend - equity shares |
- |
- |
Tax on proposed dividend |
- |
- |
Balance c/d to balance sheet |
(331.51) |
(40,564.81) |
Paid Up equity share capital (Face value of Rs. 1/- per share) |
4281.82 |
4281.82 |
Reserves excluding revaluation reserve |
32,179.46 |
32,510.97 |
Earning per share (annualized) - in Rs. Basic and Diluted |
(0.08) |
(9.47) |
The Company proposes to further provide for diminution in the value of investment during the current year in view of the present status of the project coupled with the offer since received by the company from a prospective investor.
Extension of time for holding Annual General Meeting
The Registrar of Companies (ROC), Hyderabad, has granted extension of time to the company for holding the 6th Annual General Meeting, up to December 29,2016.
Status of the Oil Refinery Project
Your company holds 46.78% of equity share capital of Nagarjuna Oil Corporation Limited (NOCL) which is involved in setting-up a 6 MMTPA refinery project at Cuddalore, Tamil Nadu.
The implementation of the Project was impacted by cyclone ''Thane''. The physical completion of the Project as ontiate is 58%.
Consolidated Financial Results Rs. in Lakhs
Particulars |
2015 - 2016 Current year |
2014 - 2015 Previous year |
Net sales/income from operations |
||
Other income |
1.54 |
- |
Total expenditure |
||
a. (Increase)/Decrease in Stock |
||
b. Cost of materials consumed |
||
c. Employee benefits expense |
150.94 |
- |
d. Purchase of traded products |
||
e. Power and fuel |
||
f. Other expenses |
167.98 |
- |
Total |
318.92 |
- |
Finance cost |
wmmzam: |
- |
Depreciation and amortization |
2.12 |
- |
Profit/ (Loss) before exceptional items, extra-ordinary items and tax |
(331.51) |
- |
Exceptional Items |
- |
- |
Profit/ (Loss) before extra-ordinary items and tax |
(331.51) |
- |
Extra-ordinary items |
» |
- |
Profit/ (Loss) before exceptional items, extra-ordinary items and tax |
(331.51) |
- |
Provision for tax |
* |
- |
Deferred tax |
- |
- |
Profit / (loss) after tax before Minority interest |
(331.51) |
- |
Share of Loss transferred to Minority Interest |
- |
- |
Share of Loss from Associate Company |
(92.58) |
. |
Profit / (Loss) for the year |
(424.09) |
- |
Dividend-equity shares |
- |
|
Tax on proposed dividend |
- |
- |
Balance c/d to Balance Sheet |
(424.09) |
- - |
Paid-up equity share capital (Face value of Rs. 1/- per share) |
(4281.82) |
- |
Reserves excluding revaluation reserve |
29809.68 |
- |
Earnings per share (annualized) - in Rs. Basic and Diluted |
(0.10) |
- |
NOCL has been actively pursuing with strategic investors to participate in equity investment in view of escalation in the project cost.
The company has been approached by Allied Machineries and Resources Holdings Inc., ("AMR") a Company incorporated in Ras Al Khaimah RAS 065114 2014 with principal place of business located at 36-05 Central Park, Dubai International Financial Centre Dubai UAE, to acquire the 77,62,20,000 equity shares held in NOCL at Rs.2.50/- per equity share of face value of Rs.10/- apart from AMR acquiring the entire equity shareholding of other shareholders of NOCL except TIDCO.
AMR, with backing of ultra high net worth individuals, who have strategic interest in the oil and gas sector, have the resources and capabilities not only to implement the current project but also propose to undertake expansion / diversification that will result in economies of scale.
AMR Group is a Dubai based fund with assets exceeding USD 2 billion The AMR Group has high profile investors from China, Japan, Korea and Gulf.
The Group is involved in Aviation, Transportation, Infrastructure, Oil & Natural Resources, Media, Entertainment, Information Technology, Education and Social Services.
AMR is also in discussion with Lenders of NOCL for retiring the debt of the company.
AMR is in the process of completing all its due diligences on NOCL The proposed sale of NOCL shares to AMR is beneficial to the Company in view of NORL having invested substantial funds and being unable to bring further funds to take the Project forward, the Project being at stand still since March ''2012, the escalation in the Project cost being to the company''s dis-advantage, the Lenders not willing to have further exposure of debt on NOCL in view of the present status of the Project, there being substantial diminution in the value of investment and the offer of AMR being the best as compared to the various offers received by the company earlier in the course of identifying a strategic investor.
In view of the above and various legal cases having been filed against NOCL which could result in its winding-up and non-realization of investment by the shareholder due to loss of value of shares, the Board of Directors of the company considered it necessary to dis-invest the shareholding in NOCL in favour of an investor so as to enable the Project move forward as also enable NORL to realize funds to look at new avenues in the interest of the shareholders.
The sale of shares will also relieve the onerous responsibility of NORL as Promoter of all obligations and comfort provided to the lenders.
The sale of shares held by the company in NOCL will require approval of the Members of the company through a process of Postal Ballot.
The company is issuing notice pursuant to Section 110 of the Companies Act, 2013 read with Companies (Management and Administration) Rules 2014 for obtaining the consent of the Members. The Postal Ballot Notice and Instructions on remote e-voting for postal ballot is appended to the Annual Report at page 50 and page 52. The Members are requested to peruse the documents and exercise their vote either in electronic mode or physical mode in accordance with the instructions and within the timelines prescribed therein.
Share Capital
The paid-up equity capital of the company as on March 31, 2016 is Rs.42,81,81,821/- consisting of 42,81,81,821 equity shares of Re.1/- each. Subsidiaries, Joint Ventures or Associate Companies:
There has been no change in relation to any subsidiary, joint venture or associate company during the year.
Accounts of Associates
Consolidated financial statements are enclosed along with the financial statements of the company. The Associate considered in the preparation of the consolidated financial statements is Nagarjuna Oil Corporation Limited (NOCL).
Statement containing salient features of the financial statement of subsidiaries/ associate companies/ joint ventures appears as Annexure I to this Report.
There is no material fact that requires mention on the performance and financial position of the Associate other than that mentioned in this report under "Status of Oil Refinery Project."
B. DIRECTORS, BOARD COMMITTEES, KEY MANAGERIAL PERSONNEL AND REMUNERATION
Directors Retiring by Rotation
In accordance with Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Mr. K S Raju who is liable to retire by rotation and being eligible, offers himself for re-appointment as Director of the Company, subject to retirement by rotation.
Declaration by independent Directors:
The Independent Directors have submitted their disclosure to the Board that they fulfill all the requirements as to qualify as an Independent Director under Section 149(6) of the Companies Act, 2013, as well as SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Key Managerial Personnel:
There are no changes in relation to Key Managerial Personnel of the Company
Meetings of the Board
The Board of Directors of your company, during the period under review met six times on May 16,2015, June 10,2015, July 23,2015, September 08, 2015, November03,2015 and February 04,2016.
Remuneration and other particulars of the Directors/ Key Managerial Personnel/ Employees
The information relating to remuneration and other particulars of the Directors/ Key Managerial Personnel/Employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 appears as Annexure - II
Personnel
In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules appears as Annexure - III.
Committees
Audit Committee:
In compliance with the provisions of Section 177 of the Companies Act, 2013 and the Erstwhile Listing Agreement entered into with the Stock Exchanges (now Regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015), the company had constituted an Audit Committee consisting of qualified and experienced members from various fields. The Committee consists of three Independent Directors and one nonexecutive Director. The Chairman of the Committee is Dr. N C B Nath, an Independent Director. The Committee meets periodically to review the internal audit report, quarterly Financial Results and Annual Financial Statements and recommends its decisions to the Board apart from taking action independently whenever required. The Statutory Auditors and Company Secretary attend the Audit Committee Meetings.
The Audit Committee comprises of
Dr. NCBNath Chairman-Independent Director
Mr.SRRamakrishnan : Member-Independent Director
Ms. Lalitha Raghuram Member-Independent Director
Mr. KS Raju Member
Nomination and Remuneration Committee:
The Nomination and Remuneration Committee was constituted in compliance with the provisions of the Companies Act, 2013 and Erstwhile Listing Agreement entered into with the Stock Exchanges (now Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The Company has adopted a Nomination and Remuneration Policy for determining, inter-alia, qualifications, positive attributes and independence of a Director, matters relating to the remuneration, appointment, removal and evaluation of performance of the Directors, Key Managerial Personnel, Senior Management and other employees. Stakeholders Relationship Committee:
The Stakeholders Relationship Committee was constituted in compliance with the provisions of the Companies Act, 2013 and Erstwhile Listing Agreement entered into with the Stock Exchanges (now Regulation 20 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
C. DISCLOSURES
Company Policy Matters
Your company''s endeavor has always been to maintain transparency and accountability to its stakeholders. In this direction, various policies mentioned in the Corporate Governance Report have been implemented to enable the stakeholders to appreciate the various interventions the company has taken.
The implementation of these policies are reviewed periodically by the Board of Directors and updated regularly.
The company has during the year drawn-up Policy for preservation and archival of documents that sets out the standard for Classifying, Managing and Storing of records of the Company and Policy on Disclosure of Material Events for the purpose of making disclosures to Stock Exchanges effective from December 01,2015.
Risk Management Policy:
The Board has put in place the Risk Management Policy for the company to address various risks impacting the company.
The company has setup an Enterprise Risk Management System to manage and mitigate risks.
Policy on Board Evaluation
The Policy on Board Evaluation was adopted with effect from November 10, 2014, by the Board of Directors in compliance of Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The purpose of the policy is to assess the effectiveness of the Board as a whole, Committees of the Board and Individual Directors (Independent and Non-Independent) on regular basis and to take necessary steps for improving the effectiveness of the Board.
The Nomination and Remuneration Committee has devised the methodology, identified sample tools for evaluation and also laid down the parameters for evaluation of Non-Executive Directors, Independent Directors, Chairman, Board of Directors and Committees of the Board.
The Nomination and Remuneration Committee, have based on the responses received from Directors, evaluated the Directors, conveyed the opinion of the Committee to the Directors, Committees and the Board.
In view of the evaluation not linked to payment of remuneration, the company has opted only for payment of sitting fees, the evaluation has no financial implications on the company.
Whistle Blower Policy/Vigil Mechanism
The company has formulated the policy on Whistle Blower/Vigil Mechanism in compliance with Clause 49 of Erstwhile Listing Agreement. The same is in conformity with Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and Section 177(9) of the Companies Act, 2013. The Policy aims to prohibit managerial personnel from taking adverse personnel action against employees disclosing in good faith, alleged wrongful conduct on matters of public concern involving violation of any law, mismanagement, misappropriation of public funds, among others.
Employees aware of any alleged wrongful conduct are encouraged to make a disclosure to the Audit Committee.
No personnel of the company were denied access to the Audit Committee.
Corporate Social Responsibility
The provisions relating to Corporate Social Responsibility does not apply to the Company.
Corporate Governance
Your company firmly believes that building a culture of compliance is more than meeting regulations and standards. Your company is always proactive in meeting mandated standards and practicing Corporate Governance in spirit and not just the letter of the law.
As Mandated by SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 a report on Corporate Governance along with a Certificate from Practicing Company Secretary on the compliance of conditions of Corporate Governance is annexed hereto. Your company is happy to inform you that there were no adverse remarks/qualifications/ reservations raised in the Corporate Governance Report.
Related Party Transactions
There are no contracts or arrangements entered into by the company with related parties in accordance with the provisions of Section 188(1) of the Companies Act, 2013, other than the transaction entered into with Nagarjuna Fertilizers and Chemicals Limited pursuant to the order of the jurisdictional High Courts in relation to the Composite Scheme of Arrangement and Amalgamation between Ikisan Limited, Kakinada Fertilizers Limited, Nagarjuna Fertilizers and Chemicals Limited and Nagarjuna Oil Refinery Limited.
The Policy on Related Party Transactions appears on the website of the Company at www.norl.co.in.
Particulars of Loans, Guarantees or Investments
The company has not provided any loans, guarantees or made investments pursuant to Section 186 of the Companies Act, 2013 other than executing a Sponsored Undertaking in favor of the lenders of Nagarjuna Oil Corporation Limited.
Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo
In relation to the information required to be furnished under the Companies Act, 2013 read with Companies (Accounts) Rules, 2014, the company is not undertaking any manufacturing activity and accordingly there is no information available pertaining to Conservation of Energy and Technology Absorption. There is no Foreign Exchange Earnings and Outgo.
Extract of Annual Return
The Extract of the Annual Return for the year ended March 31,2016 appears as Annexure- IV to this report
Significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company''s operations in future
There were no orders passed by Regulators or Courts or Tribunals impacting the going concern status and future business operations of the Company. Adequacy of Internal Financial Controls
The company has established and is maintaining internal controls and procedures based on the internal control over financial reporting criteria established by the Company
The Board of Directors have evaluated the effectiveness of the company''s internal financial controls and procedures and confirm that they are adequate in all material respects based on the size and the nature of its business and such internal financial controls over financial reporting were operating effectively as at March 31,2016 Deposits
The company has not accepted any deposits within the purview of the Companies Act, 2013 and the Rules made there under during the Financial Year 2015-16.
AUDITORS AND AUDIT REPORT
Statutory Auditors
M/s. M Bhaskara Rao & Co., Chartered Accountants (Firm Registration No-0004595), Hyderabad, were appointed as the Statutory Auditors''for a term of five (5) years commencing from the conclusion of the 4th Annual General Meeting up to the conclusion of the 9th Annual General Meeting subject to ratification by the members of the company every year at the Annual General Meeting.
M/s. M Bhaskara Rao & Co have signified their willingness to accept ratification of appointment and have further confirmed their eligibility underSectionl41 of the Companies Act, 2013.
The company''s Statutory Auditors have also furnished a certificate from the Peer Review Board of the ICAI confirming that they have undergone the process of peer review.
The Board of Directors in accordance with the provisions of Section 139 of the Companies Act, 2013 and Rules made there under commend the ratification of the appointment of Statutory Auditors for the Financial Year 2016-17 for consideration of the members.
Statutory Audit Report
There are no adverse comments in the Report of the Statutory Auditors'' of the company.
Secretarial Auditor
The Board of Directors have appointed Mr. C S S Krishna, Partner, M/s KBG Associates, Company Secretaries, Hyderabad as the Secretarial Auditor of the Company to undertake Secretarial Audit for the Financial Year2016-17. Secretarial Audit Report
The Secretarial Audit Report for the Financial Year 2015-16 appears as Annexure - V to this Report. There are no qualifications or adverse remarks in the report.
Internal Audit
The company has a well established system of Internal Audit which carries out audit on Risk Management framework covering all the functions.
An Internal Auditor of the company has been appointed by the Board of Directors, in compliance with the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
D. DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant to Section 134 (3)(c) and 134(5) of the Companies Act, 2013, the Board of Directors of the Company hereby report:-
(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 that period;
(c) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
(d) the directors had prepared the annual accounts on a going concern basis; and
(e) the Directors, in the case of a listed 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.
(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.
ACKNOWLEDGEMENT
Your Directors place on record their gratitude to the Government of India and the financial institutions and company''s bankers for their assistance and cooperation.
Further, the company places on record its sincere appreciation for the continuing support and unstinting efforts of investors, associates and all stakeholders.
By Order of the Board
Hyderabad K S Raju
November 08,2016 Chairman
Mar 31, 2015
Dear Members,
The Directors have pleasure in presenting before you the 5th Annual
Report of the Company together with the Audited Statements of Accounts
for the year ended March 31, 2015.
The Financial Results of the Company for the year ended March 31, 2015
are as under :
A. BUSINESS AND FINANCIAL HIGHLIGHTS
Standalone Financial Results: Rs In Lakhs
Particulars 2014 - 2015 2013 - 2014
Current Year Previous Year
Net Sales/Income from Operations - -
Other Income 3.30 -
Total Expenditure
a. Increase/(decrease) in Stock - -
b. Cost of materials consumed - -
c. Employee benefits expense 73.71 75.86
d. Purchase of traded products - -
e. Power and fuel - -
f. Other expenses 484.33 95.03
Total 558.04 170.89
Finance cost 7.95 -
Depreciation and amortization 2.12 4.03
Exceptional Items 40,000.00 -
Profit before tax (40,564.81) (174.92)
Profit after tax (40,564.81) (174.92)
Balance c/d to balance sheet (40,564.81) (174.92)
Paid Up equity share capital
(Face value of Rs.1/- per share) 4281.82 4281.82
Reserves excluding revaluation reserve 32,510.97 73,075.83
Earning per share (annualized) - in Rs.
Basic and Diluted (9.47) (0.04)
Financial Summary
The Loss after tax for the year was Rs.40,564.81 Lakhs against loss after
tax of Rs.174.92 Lakhs for the previous year.
The main contributors to the loss was on exceptional item representing
a provision of Rs. 40,000 lakhs towards diminution in the value of
investment in Nagarjuna Oil Corporation Limited (NOCL), considering the
delay in induction of partner and consequently, achieving financial
closure for re-assessed cost of project.
Status of the Oil Refinery Project
Your Company holds 46.78% of equity share capital in Nagarjuna Oil
Corporation Limited (NOCL) which is involved in setting-up a 6 MMTPA
refinery project at Cuddalore, Tamil Nadu.
The implementation of the Project was impacted by cyclone 'Thane'. The
physical completion of the Project as on date is 58%.
NOCL is actively pursuing with strategic investors to participate in
equity investment in view of escalation in the project cost. The due
diligence by some of the Investors has been completed and the Company
is awaiting their decision.
In view of the escalation in project cost, NOCL is making all efforts
to achieve financial closure at the earliest.
Share Capital
The paid-up equity capital of the Company as on March 31, 2015 is
Rs.42,81,81,821/- consisting of 42,81,81,821 equity shares of Rs.1/- each.
Subsidiaries, Joint Ventures or Associate Companies:
Nagarjuna Oil Corporation Limited (NOCL) an associate of the Company,
is setting up a petroleum refinery project at Cuddalore, Tamil Nadu.
The Ministry of Corporate Affairs, Government of India has granted
exemption for the consolidation of financial statement in respect of
associate companies which does not have a subsidiary or subsidiaries.
Accordingly, Financial Statements of the Associate Company is not
attached to the Annual Accounts of the Company.
A statement containing salient features of the Financial Statement of
Associate Company appears as Annexure-I to this Report
B. DIRECTORS, BOARD COMMITTEES, KEY MANAGERIAL PERSONNEL AND
REMUNERATION
Directors Retiring by Rotation
In accordance with Section 152 of the Companies Act, 2013 and the
Articles of Association of the Company, Mr. Chandra Pal Singh Yadav who
is liable to retire by rotation and being eligible, offers himself for
re-appointment as Director of the Company, subject to retirement by
rotation.
Independent Director
In accordance with Section 149, 152 and Schedule IV read with relevant
Rules of the Companies Act, 2013, Ms. Lalitha Raghuram is proposed to
be appointed as Independent Director of the Company not liable to
retire by rotation upto the conclusion of the 10th Annual General
Meeting pursuant to the provisions of Section 149 of the Companies Act,
2013 and the Listing Agreement.
Declaration by Independent Directors
The Independent Directors have submitted their disclosure to the Board
that they fulfill all the requirements as to qualify as an Independent
Director under Section 149(6) of the Companies Act, 2013, as well as
Clause 49 of the Listing Agreement
Key Managerial Personnel:
Company Secretary
The Board has appointed Ms. Ankita Mathur as the Company Secretary of
the Company with effect from March 5, 2015 in place of Mr. T Vamsi
Krishna who has separated from the service of the Company.
There are no other changes in relation to other Key Managerial
Personnel.
Meetings of the Board
The Board of Directors of your Company, during the period under review
met five times on May 29, 2014, July 30, 2014, October 18, 2014,
November 10, 2014 and February 13, 2015.
Remuneration and other particulars of the Directors/Key Managerial
Personnel/Employees
The information relating to remuneration and other particulars of the
Directors/Key Managerial Personnel/Employees as required under Section
197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014
appears as Annexure - II.
Personnel
In terms of the provisions of Section 197(12) of the Companies Act,
2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, a statement showing
the names and other particulars of the employees drawing remuneration
in excess of the limits set out in the said rules appears as Annexure -
III.
Committees:
Audit Committee
In compliance with the provisions of Section 177 of the Companies Act,
2013 and the Listing Agreement entered into with the Stock Exchanges,
the Company had constituted an Audit Committee consisting of qualified
and experienced members from various fields. The Committee consists of
three independent Directors and one non- executive Director. The
Chairman of the Committee is Dr. N C B Nath, an Independent Director.
The Committee meets periodically to review the internal audit report
and quarterly financial statements and recommends its decisions to the
Board apart from taking action independently whenever required. The
Statutory Auditors and Secretary attend the Audit Committee Meetings.
The Audit Committee comprises of
Dr. N C B Nath : Chairman - Independent Director
Mr. S R Ramakrishnan : Member - Independent Director
Ms. Lalitha Raghuram : Member - Independent Director
Mr. K S Raju : Member
Nomination and Remuneration Committee
The Nomination and Remuneration Committee was constituted in compliance
with the provisions of the Companies Act, 2013 and revised Clause 49 of
the Listing Agreement
The Company has also adopted a Nomination and Remuneration Policy for
determining, inter-alia, qualifications, positive attributes and
independence of a Director, matters relating to the remuneration,
appointment, removal and evaluation of performance of the Directors,
Key Managerial Personnel, Senior Management and other employees.
Stakeholders Relationship Committee
The Stakeholders Relationship Committee was constituted in compliance
with the provisions of Companies Act, 2013 and Clause 49 of the Listing
Agreement
C. DISCLOSURES
Company Policy Matters
Your Company's endeavor has always been to maintain transparency and
accountability to its stakeholders. In this direction, various policies
mentioned in the Corporate Governance Report have been implemented to
enable the stakeholders to appreciate the various interventions the
Company has taken.
The implementation of these policies are reviewed periodically by the
Board of Directors and updated regularly.
The Company has during the year drawn-up a Nomination and Remuneration
Policy and Board Evaluation Policy and made it effective from November
10, 2014.
Risk Management Policy
The Board has put in place the Risk Management Policy for the Company
to address various risks impacting the Company.
The Company has setup an Enterprise Risk Management System to manage
and mitigate risks.
Policy on Board Evaluation
The Policy on Board Evaluation was adopted with effect from Nobember
10, 2014, by the Board of Directors in compliance of Companies Act,
2013 and Clause 49 of the Listing Agreement entered into with the Stock
Exchanges.
The purpose of the policy is to assess the effectiveness of the Board
as a whole, Committees of the Board and Individual Directors
(Independent and Non-Independent) on regular basis and to take
necessary steps for improving the effectiveness of the Board.
The Nomination and Remuneration Committee has devised the methodology,
identified sample tools for evaluation and also laid down the
parameters for evaluation of Non-Executive Directors, Independent
Directors, Chairman, Committees of the Board and the Board.
The Nomination and Remuneration Committee, have based on the responses
received from Directors, evaluated the Directors, conveyed the opinion
of the Committee to the Directors, Committees and the Board.
In view of the evaluation not linked to payment of remuneration, as the
Company has opted only for payment of sitting fees, the evaluation has
no financial implications on the Company.
Whistle Blower Policy
The Company formulated a policy to prohibit managerial personnel from
taking adverse personnel action against employees disclosing in good
faith, alleged wrongful conduct on matters of public concern involving
violation of any law, mismanagement, misappropriation of public funds,
among others.
Employees aware of any alleged wrongful conduct are encouraged to make
a disclosure to the Audit Committee.
No personnel of the Company were denied access to the Audit Committee.
Corporate Social Responsibilty
The provisions relating to Corporate Social Responsibility does not
apply to the Company.
Corporate Governance
Your Company firmly believes that building a culture of compliance is
more than meeting regulations and standards. Your Company is always
proactive in meeting mandated standards and practicing Corporate
Governance in spirit and not just the letter of the law.
As Mandated by Clause 49 of the Listing Agreement a report on Corporate
Governance alongwith a Certificate from Practicing Company Secretary on
the compliance of conditions of Corporate Governance is annexed hereto.
Your Company is happy to inform you that there were no adverse
remarks/qualifications/reservations raised in the Corporate Governance
Report.
Related Party Transactions
There are no contracts or arrangements entered into by the Company with
related parties in accordance with the provisions of Section 188(1) of
the Companies Act, 2013, other than the transaction entered into with
Nagarjuna Fertilizers and Chemicals Limited pursuant to the Order of
the jurisdictional High Courts in relation to the Composite Scheme of
Arrangement and Amalgamation between ikisan Limited, Kakinada
Fertilizers Limited, Nagarjuna Fertilizers and Chemicals Limited and
Nagarjuna Oil Refinery Limited.
Particulars of Loans, Guarantees or Investments
The Company has not provided any loans, guarantees or made investments
pursuant to Section 186 of the Companies Act, 2013 other than executing
a Sponsored Undertaking in favor of the lenders of Nagarjuna Oil
Corporation Limited.
Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings and Outgo
In relation to the information required to be furnished under the
Companies Act, 2013 read with Companies (Accounts) Rules, 2014, the
Company is not undertaking any manufacturing activity and accordingly
there is no information available pertaining to
Conservation of Energy and Technology Absorption. There is no Foreign
Exchange Earnings and Outgo.
Extract of Annual Return
The Extract of the Annual Return for the year ended March 31, 2015
appear as Annexure- IV to this report
Significant and material orders passed by the regulators or courts or
tribunals impacting the going concern status and Company's operations
in future
There were no orders passed by Regulators or Courts or Tribunals
impacting the going concern status and future business operations of
the Company.
Adequacy of Internal Financial Controls
The Company has established and is maintaining internal controls and
procedures.
The Board of Directors have evaluated the effectiveness of the
Company's internal controls and procedures and confirm that they are
adequate based on the size and the nature of its business.
Deposits
The Company has not accepted any deposits within the purview of the
Companies Act, 2013 and the Rules made thereunder during the financial
year 2014-15.
D. AUDITORS AND AUDIT REPORT Statutory Auditors
M/s. M Bhaskara Rao & Co., Chartered Accountants, Hyderabad, were
appointed as the Statutory Auditors' for a term of five (5) years
commencing from the conclusion of the 4th Annual General Meeting up to
the conclusion of the 9th Annual General Meeting subject to
ratification by the members of the Company every year at the Annual
General Meeting.
M/s. M Bhaskara Rao & Co have signified their willingness to accept
ratification of appointment and have further confirmed their
eligibility under Section 141 of the Companies Act, 2013.
The Company's Statutory Auditors have also furnished a certificate from
the Peer Review Board of the ICAI confirming that they have undergone
the process of peer review.
The Board of Directors in accordance with the provisions of Section 139
of the Companies Act, 2013 and Rules made thereunder commend the
ratification of the appointment of Statutory Auditors for the Financial
year 2015-16 for consideration of the members.
Statutory Audit Report
There are no adverse comments in the report of the Statutory Auditors'
of the Company.
Secretarial Auditor
The Board of Directors at their meeting held on May 16, 2015 pursuant
to the provisions of Section 203 of the Companies Act, 2013 have
appointed Mr. C S S Krishna, Partner, M/s KBG Associates, Company
Secretaries, Hyderabad as the Secretarial Auditor of the Company to
undertake Secretarial Audit for the Financial Year 2015-16.
Secretarial Audit Report
Pursuant to Section 204 of the Companies Act, 2013, the Secretarial
Audit Report for the Financial Year 2014-15 appears as Annexure - V to
this Report. There are no qualifications or adverse remarks in the
report.
Internal Audit
The Company has a well established system of Internal Audit which
carries out audit on Risk Management framework covering all the
functions.
An Internal Auditor of the Company has been appointed by the Board
of Directors, in compliance of the Companies Act, 2013 and Clause 49
of the Listing Agreement.
E. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134 (3)(c) and Section 134(5) of the Companies
Act, 2013, the Board of Directors of the Company hereby report:
(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 that period;
(c) the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities;
(d) the Directors had prepared the annual accounts on a going concern
basis; and
(e) the Directors, in the case of a listed 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.
(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.
ACKNOWLEDGEMENT
Your Directors place on record their gratitude to the Government of
India and the financial institutions and Company's bankers for their
assistance and cooperation.
Further, the Company places on record its sincere appreciation for the
continuing support and unstinting efforts of investors and all
stakeholders.
By Order of the Board
Hyderabad K S Raju
July 23, 2015 Chairman
Mar 31, 2014
Dear Members,
The Directors have pleasure in presenting the Fourth Annual Report
together with the Audited Accounts of the Company for the year ended
March 31, 2014.
FINANCIAL SUMMARY
Rs.in Lakhs
Particulars 2013 - 2014 2012-2013
current year previous year
Net Sales/Income from Operations - -
Other Income - -
Total Expenditure
a. Increase/(decrease) in Stock - -
b. Cost of materials consumed - -
c. Employee benefits expense 75.86 70.17
d. Purchase of traded products - -
e. Power and fuel - -
f. Other expenses 95.03 83.16
Total 170.89 153.33
Finance cost - -
Depreciation and amortization 4.03 4.82
Profit before tax (174.92) (158.15)
Provision for tax - -
Deferred tax - -
Profit after tax (174.92) (158.15)
Dividend - equity shares - -
Tax on proposed dividend - -
Balance c/d to balance sheet (174.92) (158.15)
Paid Up equity share capital
(Face value of Re.1/- per share) 4281.82 4281.82
Reserves excluding revaluation reserve 73,075.83 73,250.75
Earning per share (annualized) - in Rs.
Basic and Diluted (0.04) (0.04)
STATUS OF THE OIL REFINERY PROJECT
The company as on date holds 46.78% of Equity Capital in Nagarjuna Oil
Corporation Limited (NOCl). NOCL is setting-up 6MMTPA refinery project
at Cuddalore, Tamil Nadu.
The implementation of the Project was impacted by cyclone ''Thane''. The
physical completion of the Project as on date is 58%.
NOCL is actively pursuing with Strategic Investors to participate in
equity investment in view of escalation in the Project Cost and the due
diligence by some of the Investors has completed and awaiting their
decision.
In view of the escalation in project cost, NOCL is making all efforts
to achieve financial closure at the earliest.
CORE INVESTMENT COMPANY
The company has made application to Reserve Bank of India for
registration as ''Core Investment Company'' to comply with Core
Investment Companies (Reserve Bank) Directions, 2011.
SHARE CAPITAL
The paid-up equity capital of the company as on March 31, 2014 is Rs.
42,81,81,821/ - consisting of 42,81,81,821 equity shares of Rs. 1/-
each.
CORPORATE GOVERNANCE
The company firmly believes that building a culture of compliance is
more than meeting regulations and standards. Your company is always
proactive in meeting mandated standards and practicing corporate
governance in spirit and not just the letter of the law.
As Mandated by Clause 49 of the Listing Agreement a report on Corporate
Governance alongwith a Certificate from Practicing Company Secretary on
the compliance of conditions of Corporate Governance is annexed hereto.
Your company is happy to inform you that there were no adverse remarks
/ qualifications/ reservations raised in the Corporate Governance
Report.
NUMBER OF BOARD MEETINGS
The Board of Directors of your company, during the period under review
met Four times on May 03, 2013, August 08, 2013, November 07, 2013 and
February 06, 2014.
DIRECTORS
Nominee Director
Mr Chandra Pal Singh Yadav, Vice Chairman of Krishak Bharati
Cooperative Limited (KRIBHCO) was appointed as Nominee Director of
KRIBHCO on the Board of the company with effect from April 15, 2014.
Mr N Sambasiva Rao, Managing Director of KRIBHCO was appointed as
Alternate Director to Shri Chandra Pal Singh Yadav with effect from May
29, 2014
Independent Directors
In accordance with Section 149, 152 and Schedule IV read with relevant
Rules of the Companies Act, 2013 and the revised Clause 49 of the
Listing Agreement it is proposed to appoint Dr NCB Nath, Shri S R
Ramakrishnan and Shri D Ranga Raju as Independent Directors of the
company not liable to retire by rotation up to the conclusion of 9th
Annual General Meeting or September 25, 2019, whichever is later.
The appointments are being placed before the members of the company at
the 4th Annual General Meeting to be held on September 26, 2014 for
their approval.
Retiring by Rotation
In accordance with Section 152 of the Companies Act, 2013 and the
Articles of Association of the Company, Mr K S Raju and Mr K Rahul
Raju, who are liable to retire by rotation being eligible, offer
themselves for re-appointment as Directors of the Company, subject to
retirement by rotation.
Key Managerial Personnel:
Manager:
The Board has re-appointed Mr K Soma Raju as Manager of the company for
a period of three years with effect from August 31, 2014, subject to
the approval of members of the Company.
There are no other changes in relation to other Key Managerial
Personnel.
DECLARATION BY INDEPENDENT DIRECTORS
The Independent directors have submitted their disclosure to the Board
that they fulfill all the requirements as to qualify for their
appointment as an Independent Director under section 149(6) of the
Companies Act, 2013 as well as revised Clause 49 of the Listing
Agreement.
AUDITORS AND AUDIT REPORT
M/s. M Bhaskara Rao & Co., Chartered Accountants, Hyderabad, the
company''s auditors retire at the conclusion of the ensuing Annual
General Meeting. They have signified their willingness to accept
re-appointment and have further confirmed their eligibility under
Section 141 of the Companies Act, 2013.
The company''s Statutory Auditors have also furnished a certificate from
the Peer Review Board of the ICAI confirming that they have undergone
the process of peer review.
The Board of Directors in accordance with the provisions of Section 139
of the Companies Act, 2013 and rules made thereunder recommends their
appointment for a term of five years from the conclusion of 4th Annual
General Meeting to the conclusion of 9th Annual General Meeting subject
to ratification every year at the Annual General Meeting for
consideration of the shareholders.
VIGIL MECHANISM
The Company already has put in place a policy to prohibit managerial
personnel from taking adverse personnel action against employees
disclosing in good faith, alleged wrongful conduct on matters of public
concern involving violation of any law, mismanagement, misappropriation
of public funds, among others.
Employees aware of any alleged wrongful conduct are encouraged to make
a disclosure to the Audit Committee.
No personnel of the company was denied access to the Audit Committee.
SECRETARIAL AUDITOR
The Board of Directors at their meeting held on May 29, 2014 pursuant
to the provisions of Section 203 of the Companies Act, 2013 has
appointed Mr CSS Krishna, Practicing Company Secretary as the
Secretarial Auditor of the Company to undertake the Secretarial Audit
for the financial year 2014-15.
PERSONNEL
There are no employees as on date on the rolls of the Company who are
in receipt of remuneration which requires disclosures under provisions
of Section 217(2A) of the Companies Act, 1956.
DISCLOSURES
There are no disclosures in terms of Companies (Disclouser of
Particulars in the Report of the Board of Directors) Rules, 1988 in
respect of conservation of energy, technology absorption, earnings and
outgo of foreign exchange.
AUDIT COMMITTEE CONSTITUTION
In compliance with the provisions of the Section 177 of the Companies
Act, 2013 and the listing agreement entered into with the stock
exchanges, the company had constituted an Audit Committee consisting of
highly qualified and experienced members from various fields. The
committee consists of two independent Directors and one non-executive
Director. The Chairman of the committee Dr. N C B Nath, is an
Independent Director and the committee meets periodically to review the
quarterly financial statements and recommends its findings to the Board
apart from taking action independently whenever required. The Statutory
Auditors and Secretary attend and participate in the Audit Committee
Meetings.
The Audit Committee comprises of
Dr. N C B Nath : Chairman, Independent Director
Shri S R Ramakrishnan : Member & Independent Director
Shri K S Raju : Member
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act, 2013.
The Directors hereby report:
(a) that in the preparation of the annual accounts, the applicable
accounting standards had been followed along with proper explanation
relating to material departures;
(b) 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 that period;
(c) that the directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the company and
for preventing and detecting fraud and other irregularities;
(d) that the directors had prepared the annual accounts on a going
concern basis;
(e) that the directors, had laid down internal financial controls to be
followed by the company and that such internal financial controls are
adequate and were operating effectively.
(f) that 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.
ACKNOWLEDGEMENT
Your Directors place on record their gratitude to the Government of
India, Government of Andhra Pradesh, Government of Telangana and the
financial institutions and company''s bankers for their assistance and
cooperation.
Further, the company places on record its sincere appreciation for the
continuing support and unstinting efforts of investors, associates and
all stakeholders in ensuring an excellent all round operational
performance.
On behalf of the Board
Hyderabad K S Raju
July 30, 2014 Chairman
Mar 31, 2013
The Directors have pleasure in presenting the Third Annual Report
together with the Audited Accounts of the Company for the year ended
March 31, 2013 Status of the Oil Refinery Project
Your company as on date holds 46.78% of Equity Capital in Nagarjuna Oii
Corporation Limited (NOCL). NOCL is setting-up 6MMTPA refinery project
at Cuddalore, Tamil Nadu.
The implementation of the Project was impacted by cyclone ''Thane''. The
physical completion of the Project as on date is 58%.
NOCL is actively pursuing with Strategic Investors to participate in
equity investment in view of escalation in the Project Cost and the due
diligence by some of the Investors in under progress.
In view of the escalation in project cost, NOCL is making all efforts
to achieve financial closure at the earliest.
Core Investment Company
Your company has made application to Reserve Bank of India for
registration as ''Core Investment Company1 to comply with Core
Investment Companies (Reserve Bank) Directions, 2011.
Postal Ballot
Your company, in terms of approval of the shareholders under section
192A of the Companies Act, 1956 read with Companies (passing of the
resolution by postal ballot) rules, 2001 had sought the approval for
subscribing to shares, making loans, providing guarantee in form of
Sponsor Undertaking to the Lenders of Nagarjuna Oil Corporation Limited
(NOCL).
The Postal Ballot results indicated that special resolution was passed
with requisite majority and the results were declared by the Chairman
Shri K S Raju on August 22, 2012.
CORPORATE GOVERNANCE
Your company firmly believes that building a culture of compliance is
more than meeting regulations and standards. Your company is always
proactive in meeting mandated standards and practicing corporate
governance in spirit and not just the letter of the law.
As Mandated by Clause 49 of the Listing Agreement a report on Corporate
Governance alongwith a Certificate from Practicing Company Secretary on
the compliance of conditions of Corporate Governance is annexed hereto.
Your company is happy to inform you that there were no adverse remarks
/ qualifications/ reservations raised in the Corporate Governance
Report.
DIRECTORS
In accordance with the Companies Act, 1956 and the Articles of
Association of the Company, Dr. N C B Nath and Shri S R Ramakrishnan,
who are liable to retire by rotation being eligible, offer themselves
for re-appointment as Directors of the Company, subject to retirement
by rotation.
AUDITORS
M/s. M. Bhaskara Rao & Co., Chartered Accountants, Hyderabad, the
Statutory Auditors of the Company retires at the conclusion of the
ensuing Annual General Meeting. They have signified their willingness
to accept re-appointment vide letter dated April 18, 2013, and have
further confirmed their eligibility under section 224(1 B) of the
Companies Act, 1956.
The Company''s Statutory Auditors have also furnished us a certificate
dated May 25, 2012 from the Peer Review Board of the ICAI confirming
that they have undergone the process of peer review.
PERSONNEL
There are no employees as on date on the rolls of the Company who are
in receipt of remuneration which requires disclosures under Sec 217
(2A) of Companies Act, 1956 and Companies (Particulars of Employees)
Rules, 1975.
DISCLOSURES
Disclosure in terms of Companies (Disclosure of particulars in the
Report of the Board of Directors) Rules, 1988 in respect of
conservation of energy, technology absorption, earnings and outgo of
foreign exchange are not applicable.
AUDIT COMMITTEE CONSTITUTION
In compliance with the provisions of the Section 292A of the Companies
Act, 1956 and the listing agreement entered into with the stock
exchanges, the company had constituted an Audit Committee consisting of
highly qualified and experienced members from various fields. The
committee consists of two independent Directors and one non-executive
Director. The Chairman of the committee Dr. N C B Nath, is an
Independent Director and the committee meets periodically to review the
quarterly financial statements and recommends its findings to the Board
apart from taking action independently whenever required. The Statutory
Auditors and Secretary attend and participate in the Audit Committee
Meetings.
The Audit Committee comprises of
Dr. N C B Nath : Chairman & Independent Director
Shri S R Ramakrishnan : Member & Independent Director
Shri K S Raju : Member
DIRECTORS RESPONSIBILITY STATEMENT
Your Directors wish to state the following, with regard to the
preparation of Annual
Accounts for the year ended March 31, 2013
1. That in preparation of Annual Accounts, the applicable and relevant
Accounting Standards have been followed and there have been no major or
material departure from the standards.
2. That they have selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the company at the end of financial year and Statement of Profit and
Loss of the* company for the year under review.
3. That proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the company and for
preventing and detecting frauds and other irregularities.
4. That the Annual Accounts have been prepared on a ''going concern''
basis.
By Order of Board
May 03, 2013 K.S. Raju
Hyderabad Chairman
Mar 31, 2012
The Directors have pleasure in presenting the Second Annual Report
together with the Audited Accounts of the Company for the year ended
March 31, 2012
RESTRUCTURING
The Composite Scheme of Arrangement and Amalgamation between Kakinada
Fertilizers Limited (KFL), iKisan Limited (iKisan), Nagarjuna
Fertilizers and Chemicals Limited (NFCL) and Nagarjuna Oil Refinery
Limited (NORL) (Scheme) was approved by the Hon'ble High Court of
Bombay at Mumbai on June 17, 2011 and by the Hon'ble High Court of
Andhra Pradesh at Hyderabad on June 27, 2011. Consequent to the
approval of the Jurisdictional High Courts, the Composite Scheme was
made Effective on July 30, 2011 i.e., Effective Date but operative from
Appointed Date i.e., April 1, 2011. The 'Oil Business Undertaking' of
Erstwhile NFCL was demerged into your company with effect from July 30,
2011 and the residual NFCL along with iKisan were merged into KFL.
Your company had filed applications for listing of its equity shares
with Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) on
October 7, 2011. BSE approved application of the company for listing
of 42,81,81,821 equity shares on December 8, 2011 and NSE provided
in-principle approval for listing of 42,81,81,821 equity shares on
January 13, 2012.
SEBI vide letter dated February 29, 2012 granted relaxation under Rule
19(2)(b) of Securities Contracts (Regulation) Rules, 1957. The trading
in the equity shares of the Company had commenced from March 28, 2012.
All the assets and liabilities of Oil Business Undertaking were
transferred to and vested in your company with effect from the
Appointed Date, and recorded at their respective book values.
Your company has drawn up the financial statements for the year
2011-2012 as per the revised Schedule VI of the Companies Act, 1956
which provides for a new presentation of the information compared to
the earlier format.
Core Investment Company
Your company has made application to Reserve Bank of India for
registration as 'Core Investment Company' to comply with Core
Investment Companies (Reserve Bank) Directions, 2011.
CORPORATE GOVERNANCE
Your company firmly believes that building a culture of compliance is
more than meeting regulations and standards. Your company is always
proactive in meeting mandated standards and practicing corporate
governance in spirit and not just the letter of the law.
A report on Corporate Governance along with the Practicing Company
Secretary's Certificate on its compliance is annexed hereto. Your
company is happy to inform you that there were no adverse remarks /
qualifications/ reservations raised in the Corporate Governance Report.
DIRECTORS
In accordance with the Companies Act, 1956 and the Articles of
Association of the Company, Shri K.S.Raju and Shri K Rahul Raju being
eligible, offer themselves for re-appointment as Directors of the
Company, subject to retirement by rotation. Shri D Ranga Raju who was
appointed as Additional Director of the Company and who holds office up
to the conclusion of this Annual General Meeting, and being eligible,
offer himself for appointment as Director of the Company, subject to
retirement by rotation.
AUDITORS
M/s. M. Bhaskara Rao & Co., Chartered Accountants, Hyderabad, the
Statutory Auditors of the Company retires at the conclusion of the
ensuing Annual General Meeting. They have signified their willingness
to accept re-appointment vide letter dated March 16, 2012, and have
further confirmed their eligibility under Section 224(1B) of the
Companies Act, 1956.
The Company's Statutory Auditors have also furnished us a certificate
dated May 25, 2012 from the Peer Review Board of the ICAI confirming
that they have undergone the process of peer review.
Share Capital
During the year the following changes were effected to the equity share
capital of the company:
- One equity share of Rs.10/- each was sub-divided into ten equity
shares of Rs.1/- each
- Pursuant to the Composite Scheme 42,81,81,821 equity shares of Rs.1/-
each were issued to the shareholders of Erstwhile nFcL
- The pre-scheme equity paid-up capital of Rs.5 Lakhs consisting of
5,00,000 equity shares of Rs.1/- each held by Promoters was cancelled.
The paid-up equity capital of the company as on March 31, 2012 is Rs.
42,81,81,821/- SUBSIDIARY COMPANIES
During the year upon making the Composite Scheme effective, Nagarjuna
Oil Corporation Limited (NOCL) became a subsidiary of your company with
effect from July 30, 2011.
NOCL ceased to be subsidiary of the company with effect from March 29,
2012, consequent to the shareholding of the company in NOCL being
reduced to 46.78% of the total paid-up share capital of the company.
PERSONNEL
There are no employees as on date on the rolls of the Company who are
in receipt of remuneration which requires disclosures under Sec 217
(2A) of Companies Act, 1956 and Companies (Particulars of Employees)
Rules, 1975.
DISCLOSURES
Disclosure in terms of Companies (Disclosure of particulars in the
Report of the Board of Directors) Rules, 1988 in respect of
conservation of energy, technology absorption, earnings and outgo of
foreign exchange are not applicable AUDIT COMMITTEE CONSTITUTION
In compliance with the provisions of the Section 292A of the Companies
Act, 1956 and the listing agreement entered into with the stock
exchanges, the Company had constituted an Audit Committee consisting of
highly qualified and experienced members from various fields. The
committee consists of two independent Directors and one non-executive
Director. The Chairman of the committee Dr. N C B Nath, is an
Independent Director and the committee meets periodically to review the
quarterly financial statements and recommends its findings to the Board
apart from taking action independently whenever required. The Statutory
Auditors and Secretary attend and participate in the Audit Committee
Meetings.
The Audit Committee comprises of
Dr. N C B Nath : Chairman & Independent Director
Shri S R Ramakrishnan : Member & Independent Director
Shri K S Raju : Member
DIRECTORS RESPONSIBILITY STATEMENT
Your Directors wish to state the following, with regard to the
preparation of Annual Accounts for the year ended March 31, 2012
1. That in preparation of Annual Accounts, the applicable and relevant
Accounting Standards have been followed and there have been no major or
material departure from the standards.
2. That they have selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of financial year and of Statement of Profit and
Loss of the Company for the year under review.
3. That proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting frauds and other irregularities.
4. That the Annual Accounts have been prepared on a 'going concern'
basis.
By Order of Board
June 20, 2012 K.S. Raju
Hyderabad Chairman
Mar 31, 2011
The Directors have pleasure in presenting the First Annual Report
together with the Audited Accounts of the Company for the year ended
March 31, 2011
ACTIVITIES OF THE COMPANY
Your Company was established to carry the business of extraction of Oil
from various commodities by mechanical, electrical and/or chemical
means.
Your company has taken various initiatives like identifying possible
locations for setting-up a Plant and marketing of the Oil Business.
RESTRUCTURING
Your Directors in order to achieve market Leadership position, expand
the Oil Business and give focused attention to the respective
businesses, consider it advantageous to implement a Composite Scheme of
Arrangement and Amalgamation (Scheme) of the company subject to the
company obtaining requisite approvals of the shareholders, banks,
Financial institutions and jurisdictional High Courts.
The Scheme envisages the Merger of Like business and demerger of unlike
business resulting in synergies in businesses, inorganic growth and
capturing the untapped market share by enhancing the product portfolio,
service offerings, customer base, market positioning apart from
attracting fresh investment in the respective sectors.
The Company has filed a Petition with the Hon'ble High Court of
Andhra Pradesh for a Composite Scheme of Arrangement and Amalgamation
between Kakinada Fertilizers Limited and iKisan Limited and Nagarjuna
Fertilizers and Chemicals
Limited and Nagarjuna Oil Refinery Limited and their respective
shareholders and creditors
Pursuant to the approval of the Scheme by the Court, the Oil Business
undertaking of NFCL would be merged into the Company and the shares of
the company will list on Bombay Stock Exchange and National Stock
Exchange.
DIRECTORS
In accordance with the Companies Act, 1956 and the Articles of
Association of the Company, Shri K.S.Raju, Shri. K.Rahul Raju, and Shri
K Soma Raju, who were named as First Directors under Article 112 of the
Articles of Association of the Company and who holds office up to the
conclusion of this Annual General Meeting, and being eligible, offer
themselves for re-appointment as Directors of the Company, subject to
retirement by rotation.
Dr. N C B Nath and Shri S R Ramakrishnan who were appointed as
Additional Directors of the Company and who holds office up to the
conclusion of this Annual General Meeting, and being eligible, offer
themselves for re-appointment as Directors of the Company, subject to
retirement by rotation.
AUDITORS
M/s. M. Bhaskara Rao & Co., Chartered Accountants, Hyderabad, the
Statutory Auditors of the Company retires at the conclusion of the
ensuing Annual General Meeting. They have signified their willingness
to accept re-appointment vide letter dated April 05, 2011 and have
further confirmed their eligibility under section 224(1 B) of the
Companies Act, 1956.
PERSONNEL
There are no employees as on date on the rolls of the Company who are
in receipt of remuneration which requires disclosures under Sec 217
(2A) of Companies Act, 1956 and Companies (Particulars of Employees)
Rules, 1957. DISCLOSURES
There are no particulars to be disclosed in relation to Conservation of
Energy, Technology Absorption, Foreign Exchange Earnings and Outgo as
required under the Companies (Disclosure of Particulars in the Report
of Board of Directors) Rules, 1988.
DIRECTORS RESPONSIBILITY STATEMENT
Your Directors wish to state the following, with regard to the
preparation of Annual Accounts for the year ended March 31, 2011
1. That in preparation of Annual Accounts, the applicable and relevant
Accounting Standards have been followed and there have been no major or
material departure from the standards.
2. That they have selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the company at the and of financial year and of Profit and Loss Account
of the company for the year under review.
3. That proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the company and for
preventing and detecting frauds and other irregularities.
4. That the Annual Accounts have been prepared on a 'going
concern' basis.
June 17, 2011 By Order of Board
Hyderabad Chairman