Dear Members,
Winsome Yarns Limited (herein after referred as "the
Company") (Company Under Corporate Insolvency Resolution Process)
The Resolution Professional/Suspended Board of Directors present the
34th Annual Report and the Financial Statements of the Company for the year ended 31st
March, 2024.
INITIATION OF CORPORATE INSOLVENCY RESOLUTION PROCESS (CIRP):
The Hon'ble Adjudicating Authority, i.e., National Company Law
Tribunal, Chandigarh Bench, has admitted the Company Petition i.e. C.P (IB) No.
291/Chd/Chd/2018, filed by M/s. Edelweiss Asset Reconstruction Company Limited, the
Financial Creditor initiating Corporate Insolvency Resolution Process ("CIRP")
vide order dated 22.12.2023 under Insolvency & Bankruptcy Code, 2016 (hereinafter
referred to as "Code") in the matter of M/s. Winsome Yarns Ltd. ("Corporate
Debtor"). The Adjudicating Authority vide the said Order appointed Mr. Sanjay Gupta
having Registration No. IBBI/IPA-002/IP-N00982-C01/2017-2018/10354 as Interim Resolution
Professional (IRP).r dated 22.12.2023.
The Committee of Creditors in its meeting held on 23.01.2024 approved
the appointment of M/s. ARCK Resolution Professionals LLP, having Registration No.
IBBI/IPE-0030/IPA-1/2022-23/50013 as Resolution Professional ("RP") thereby
replacing Mr. Sanjay Gupta. Thereupon an application was filed by the CoC, before
Hon'ble NCLT, for the appointment of M/s. ARCK Resolution Professionals LLP as
Resolution Professional in the captioned matter. Subsequently, the Hon'ble NCLT
allowed the application and appointed M/s. ARCK Resolution Professionals LLP as Resolution
Professional in this matter vide its Order dated 14.03.2024.
The Company is under the Corporate Insolvency Resolution Process. A
summary of the financial results is given below.
SUMMARISED FINANCIAL RESULTS: (Rs. in lakhs)
INCOME |
Year ended 31.03.2024 |
Year ended 31.03.2023 |
| Revenue from operations |
2542.58 |
3093.37 |
| Other income |
463.07 |
470.70 |
| Total Income |
3005.66 |
3564.07 |
EXPENSES |
|
|
| Cost of material consumed |
517.94 |
755.54 |
| Purchase of stock-in-trade |
-- |
-- |
| Excise duty |
-- |
-- |
Change in inventories of
finished goods, work in process and stock in trade |
152.86 |
411.22 |
| Employees benefit expenses |
1114.20 |
1606.54 |
| Finance costs |
-- |
-- |
| Depreciation and amortisation |
1148.68 |
1387.32 |
| Other expenses |
1166.21 |
2045.30 |
| Total Expense |
4099.89 |
6205.92 |
Profit/ (Loss) before
exceptional items and tax |
(1094.24) |
(2641.85) |
| Less: Exceptional items |
-- |
-- |
| Profit/ (Loss) before tax |
(1094.24) |
(2641.85) |
| Less/(-Add): Tax expense |
-- |
-- |
| Current tax |
-- |
-- |
| Deferred tax |
-- |
-- |
| Profit/ (Loss) after tax |
(1094.24) |
(2641.85) |
| Other comprehensive income |
-- |
-- |
| Total Comprehensive Income |
(1094.24) |
(2641.85) |
The Company's business of Yarn Spinning has been continuing on job
work basis. The initiation of CIRP from 22nd December, 2023, effected the marketability of
Company's products and the Knitwear business has also been mainly carried out on
job-work basis for third parties, which is continuing to the extent possible within
limited resources available with the Company.
A detailed review of the operations of the Company for the Financial
Year ended 31st March, 2024,is given below which forms as part of this report.
STATUS OF CORPORATE INSOLVENCY RESOLUTION PROCESS UNDER INSOLVENCY AND
BANKRUPTCY CODE 2016 (IBC) AFTER INITIATION:
The Corporate Insolvency Resolution Process ("CIRP")
in the case of Winsome Yarns Limited ("Company/ Corporate Debtor") was initiated
the Hon'ble National Company Law Tribunal, Chandigarh Bench ("Adjudicating
Authority") under Section 7 of the IB Code vide its order dated 22nd December 2023.
The Adjudicating Authority vide the order of the same date appointed Mr. Sanjay Gupta
having Registration No. IBBI/IPA-002/IP-N00982-C01/2017-2018/10354 as the Interim
Resolution Professional ("IRP") to conduct the CIRP of the Corporate Debtor.
Later, in the CoC Meeting of the Corporate Debtor held on 23 rd January, 2024,
M/s. ARCK Resolution Professionals LLP, having Registration No.
IBBI/IPE-0030/IPA-1/2022-23/50013 was appointed as the Resolution Professional
("RP") to run the CIRP of the Corporate Debtor.
Interim Resolution Professional had issued invitation for Expression of
Interest (hereinafter referred as ‘'EOI'') in FORM G on February 20,
2024 in compliance with Regulation 36A of CIRP Regulations, 2016 in the newspaper in
English language for the submission of a resolution plan in accordance with the provision
of the code.
As per the published FORM G, the last date for submission of EOI was
stipulated as March 5, 2024, and last date stipulated for submission of resolution plan
was April 20, 2024 which was later on extended till 31.03.2024.
The Resolution Professional received three Resolution plans which were
duly opened in presence of the COC Members in its 6th COC Meeting. Due discussion and
negotiation on all three resolutions plans were conducted by the COC. The members of the
COC in its COC Meeting decided that another FORM G be published for exploring more
potential bidders and for wealth maximization to all Stakeholders.
Thereafter, Resolution Professional had re-published invitation for
Expression of Interest (hereinafter referred as ‘'EOI'') in FORM G on
July 18, 2024 in compliance with Regulation 36A of CIRP Regulations, 2016 in the newspaper
in English and Vernacular (Punjabi) language for the submission of a resolution plan in
accordance with the provision of the code.
As per the published FORM G, the last date for submission of EOI was
stipulated as August 2, 2024 through Email and August 3, 2024 original in physical form at
the office of the RP, and last date stipulated for submission of resolution plan was
September 12, 2024, which was later on extended till 28.09.2024.
The Resolution Professional received four Resolution plans which were
duly opened in presence of the COC Members in its 15th COC Meeting. The members of the COC
duly discussed and negotiated in terms and clauses of the Resolution Plans including the
financial bid and thereafter decided to go for inter-se bidding for challenge mechanism.
Pursuant to inter se bidding convened on 22.10.2024, final Resolution Plans were submitted
by all 4 RAs. All 4 compliant Resolution Plans have duly been placed to e-voting before
the members of the COC for their approval.
A One-time settlement (OTS) proposal letter under section 12A of the
Code has also been submitted by the promoters. However, as per the requirement laid down
in Section 12 A read with Regulation 30 A, FORM FA along with requisite Bank Guarantee was
not submitted by the Applicant, EARC to the Resolution Professional.
In terms of Section 17 of the Code, on commencement of the Corporate
Insolvency Resolution Process (CIRP), the powers of the Board of Directors of Winsome
Yarns Limited stands suspended and the same are being exercised by Mr. Anil Kohli, Partner
of M/s. ARCK Resolution Professionals LLP, Resolution Professional. The management of the
affairs of Winsome Yarns Limited is vested with Mr. Anil Kohli, Partner of M/s. ARCK
Resolution Professionals LLP.
OPERATIONS & PERFORMANCE:
During the year under review, the Company's operations continued to be
affected due to lack of sufficient working capital funds required for operations resulting
in lower capacity utilization and the gross margins have suffered due to high input costs.
Furthermore, the constraints of funds have affected Company's plans to undertake
de-bottlenecking and regular capital expenditure as per industry norms, which are needed
for proper maintenance and upkeep of its plant, machinery and equipment.
During the year ended 31.03.2024, the Company incurred a loss of Rs.
1094.24 lakhs in comparison to the loss of Rs. 2641.85 lakhs during the previous year
ended 31.03.2023. Your Company's turnover of Rs. 2542.58 lakhs were marginally low against
the previous year turnover of Rs. 3093.37 lakhs for the aforementioned reasons. The
Company has since undertaken manufacturing for third parties on job work basis and is able
to recover variable costs and part of fixed costs.
As per report of overseas investment manager, the remaining amount out
of GDR issued earlier by the Company in 2011, then invested in Units of market instruments
had lost value after the crisis due to covid and wars as the underlying investments eroded
to NAV of NIL, and the Units were thereafter discarded. The Company's dealings with a
vendor who had supported the Company's operations over 5 years by providing raw
materials and sales arrangements for finished goods, got into dispute, and on settlement
reached in 2019 the vendor waived its claims and continued providing business support and
the vendor availed the option to purchase 48 bigha 11 biswas of agricultural land of the
Company at fair market value assessed by approved valuer, which sale was concluded during
the financial year.
CLAIMS AGAINST THE COMPANY:
EARC has claimed that it is an assignee of debt recoverable by certain
banks from the Company, and the Company has a counter claim against the claimants for the
losses caused by them to the Company which are pending adjudication before the
Hon'ble debt Recovery Tribunal.
The actions of the Banks and EARC, amongst others, for recovery from
the Company and the petitions filed by them to initiate insolvency against the Company,
though disputed by the Company, amongst other, for reasons of being barred by limitation,
the Company had without prejudice to its rights in the matter and without acknowledging
its liability, had initiated discussions with claimants to settle the disputes, which had
failed.
The Financial Commissioner of the State of Punjab had determined that
the Agreements for Assignment of debt by certain lenders to the Company in favour of EARC
are insufficiently stamped, and therefore, defective. A demand of Rs. 4.46 crores
(interest and penalty not applied as yet) was raised against EARC. A writ petition filed
by EARC before the Hon'ble Punjab and Haryana High Court at Chandigarh against the
proceedings initiated by the Financial Commissioner was allowed.
The State of Punjab and the Company have filed Letters Patent Appeal
(LPA) against the order of the Single Judge Bench of the Hon'ble Punjab and Haryana
High Court, which is being heard.
EARC acting in the matter as assignee of debt by certain banks in case
wherein the State of Punjab has held stamp duty to have been unpaid, had Petitioned the
Hon'ble NCLT to initiate insolvency proceedings against the Company, which was
dismissed by the Hon'ble NCLT vide its order dated 17th March 2020 as the assignment
deed was held as unenforceable. In an appeal filed by EARC against the order of the
Hon'ble NCLT, the Hon'ble NCLAT vide order dated 21 Jul 2022 has set aside the
order of the Hon'ble NCLT and remanded the matter to the Hon'ble NCLT for
rehearing and without touching the merits of the case and permitting the parties to take
all arguments before the Hon'ble NCLT. The Hon'ble NCLT vide its Order dated 22nd
December 2023, appointed Mr. Sanjay Gupta as an Interim Resolution Professional (IRP), who
took over control of management and affairs of the Company. The NCLT, Chandigarh Bench,
vide its Order dated 14.03.2024, appointed M/s. ARCK Resolution Professionals LLP having
IBBI Registration No. IBBI/IPE-0030/IPA-1/2022-23/50013, as the Resolution Professiona lto
conduct CIRP of the Company, and the powers of the Board of Directors of the Company,
earlier suspended on commencement of CIRP, are now vested with the RP. In the event of a
Resolution Plan, if one is received and is found compliant with the laws, is approved by
the Committee of Creditors and the Authorities, the insolvency of the Company may stand
resolved, which resolution may also include reliefs, concessions and waivers from
creditors of the Company, and the Company will remain a Going Concern; failure of the
aforementioned resolution process will lead to liquidation of the Company. The resolution
of disputes was initiated by the Company without prejudice to its rights in the matter,
and though the Company did not consider itself liable to the claimants, the financial
statements of the Company have been prepared on ‘Going Concern' basis.
MSME REGISTRATION:
The Company is registered with Ministry of Micro, Small and Medium
Enterprises, Government of India as 'Medium Enterprise' w.e.f. 18.07.2020 vide Udyam
Registration No. UDYAM-CH-01-0000261.
TRADING OF EQUITY SHARES OF THE COMPANY:
The equity shares of the Company are traded on BSE Limited (under Scrip
Code 514348) and National Stock Exchange of India (under Symbol ‘WINSOME').
SUBSIDIARY COMPANIES/ JOINT VENTURES/ ASSOCIATES:
There are no Subsidiary Companies/ Joint Ventures/ Associates of the
Company.
DIVIDEND AND TRANSFER TO RESERVE:
In view of losses incurred during the period under review, the Company
does not recommend any dividend on the equity shares for the financial year ended as on
March 31, 2024.
During the year under review, the Company has made no transfer to
reserves.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report for the year under review
detailing economic scenario and outlook, as stipulated under Schedule V of the SEBI
(Listing Obligations and Disclosures Requirements) Regulations, 2015 ("SEBI LODR
Regulations") is presented in a separate section and forms integral part of this
Report.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Company is not required to undertake any activities under the CSR
as per section 135 of the Companies Act, 2013 as it does not meet applicable criteria as
defined in section 135(1) of the Act and hence there is no CSR Committee constituted.
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)
The Company is not fall under Regulation 34(2)(f) of the SEBI (LODR),
Regulations, 2015, hence there is no need to annex the Business Responsibility and
Sustainability Report to the Annual Report.
COMPLIANCE OF SECRETARIAL STANDARD
The Company has complied with the Secretarial Standards issued by The
Institute of Company Secretaries of India and approved by the Central Government as
required under Section 118(10) of the Companies Act, 2013.
SHARE CAPITAL:
During the financial year 2023-24, there was no change in the Share
Capital of the Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
(a) Shri Manish Bagrodia, is Managing Director of the Company.
Furthermore, the tenure of Mr. Manish Bagrodia, as Managing Director of the Company were
completed on June 30, 2024. Accordingly, w.e.f. 1st July, 2024 Mr. Manish
Bagrodia, continued as Non-Executive and Non-Independent Director of your Company, liable
to retire by rotation and being eligible, offers himself for re-election. (b) Mrs. Mridula
Goyal is Non-Executive, Non-Independent Director has resigned from the Directorship of the
Company w.e.f. 02.10.2024 due to citing health reasons. The said resignation letter is not
accepted by the Resolution Professional and requested to revoke the intimation being filed
by her to the concerned authorities. It is pertinent to mention here that requisite
application has been filed before Hon'ble NCLT to bring on record the non-acceptance
of resignation by Resolution Professional.
(c) Shri Rajiv Chadha and Shri Pankaj Mahajan are Non-Executive,
Independent Director and not liable to retire by rotation.
(d) Ms. Anupma Kashyap was appointed as Additional Director in the
capacity of Independent Director of the Company on 22.05.2023 and resigned from the
directorship w.e.f. 22.12.2023.
(e) The tenure of five years of Shri Tilak Raj Dembla as Independent
Director has been completed on 13th September, 2024. Accordingly, Mr. Tilak Raj Dembla
(DIN:02605451) ceased to be independent director of the company w.e.f closure of business
hour of 13th September, 2024.
(f) As per available information Ms. Neha Singhal, Company Secretary
and Compliance officer of the Company has resigned from the company w.e.f. 22.12.2023.
Pursuant to which, it has become difficult to appoint another CS as the company is under
CIRP and professionals are reluctant to join a company under CIRP.
In view of the order of the Hon'ble National Company Law Tribunal,
dated December 22, 2023, the powers of the Board of Directors of the Company stood
suspended and such powers are vested with the Resolution Professional.
DECLARATION/ DISCLOSURES BY DIRECTORS:
The Directors have made the requisite declaration/ disclosures under
the provisions of Companies Act, 2013 and under the regulations of the SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015. None of the Directors are
disqualified under the provisions of Section 164(2) of the Companies Act, 2013.
PERFORMANCE EVALUATION OF BOARD:
The Company having been admitted under CIRP under Section 7 of the Code
w.e.f 22.12.2023, and the powers of the Board of Directors of the Company having been
suspended as per Section 17 of the Code and the same are now exercisable by the Resolution
Professional, there is no evaluation of Board of Directors of the Company carried out
during the year under review.
NO. OF BOARD MEETINGS:
During the period under review, falling prior to the commencement of
CIRP, the Board of Directors met five times. The details regarding the attendance and the
date of Board Meetings are provided in the "Corporate Governance Report". After
the Commencement of CIRP, the role and responsibilities of the Board of
Directors are being fulfilled by the Resolution Professional in
accordance with sections 17 and 23 of IBC 2016 and powers of the Board of Directors are
suspended. Hence, no meetings of the Directors were held after the Commencement of CIRP,
i.e., December 22, 2023.
CREDITORS MEETING:
Creditors' Meetings (CoC) were conducted during the course of the
financial year after commencement of CIRP and matters relevant to IBC Proceedings and
revival plans were duly placed before the meetings, amongst all other items that required
confirmation from Creditors.
INDEPENDENT DIRECTORS' DECLARATION:
As specified above that w.e.f December 22, 2023 the Company has been
admitted to CIRP under Section 7 of the Code. Thereafter, in accordance with Section 17 of
the Code, the powers of the Board stood suspended and be exercised by the Interim
Resolution Professional until replaced by Resolution Professional. Accordingly, the
Company does not have the necessary declaration, for period under review, from the
Independent Director as required in accordance with Section 149(7) of the Companies Act,
2013, that he/she meets the criteria of independence as laid out in sub-section (6) of
Section 149 of the Companies Act, 2013 read with Clause 16(1)(b) and 25 of the Listing
Regulations, 2015.
FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS:
On appointment, a Letter of Appointment is issued to the Independent
Directors setting out in details, the terms of appointment, duties, responsibilities and
expected time commitments. The Independent Director on being inducted on the Board, is
familiarised by way of programme with their roles, rights, responsibilities in the
Company, nature of the industry in which the Company operates, interaction with the senior
management which in turn will help them to understand business model of the Company, its
process, products etc. It also includes visit to different plants, as & when required,
to providing them thorough insight in to business operations. The Company follow such
approach for familiarisation not only for Independent Directors but any new appointee on
the Board, whenever required. To enhance their knowledge and skills, Directors are
regularly updated about recent changes/ developments in law, policies, regulations etc.
The details of familiarisation programmes are available on the following weblink of the
Company's website: :
https://www.winsomeyarns.com/_files/ugd/199b2d_7988df291e814459829db83f4be8b893.pdf
During the period one Familiarization programme was conducted on
29.05.2023.
AUDITORS:
Pursuant to Section 139 of the Companies Act, 2013, read with the
Companies (Audit and Auditors) Rules, 2014, the members of the Company in its 33rd Annual
General Meeting held on 29th September, 2023 approved the reappointment of M/s. Dhana and
Associates (Formerly known as M/s. Khandelia and Sharma), Chartered Accountants (Firm
Registration Number: 510525C) as the Statutory Auditors of the Company for a further
period of five consecutive years (second term) from the conclusion of 33rd Annual General
Meeting till the conclusion of 38th Annual General Meeting of the Company.
Further, as per the notification dated 7th May 2018, issued by Ministry
of Corporate Affairs, the appointment of Statutory Auditors, is no more required to be
ratified by members of the Company in every Annual General Meeting.
AUDITORS' REPORT:
M/s. Dhana & Associates (Erstwhile- Khandelia and Sharma),
Statutory Auditors of the Company have submitted Auditors' Report on the accounts of the
Company for the financial year ended March 31, 2024. The statement on the Impact of Audit
Qualifications of Financials have been given after the Independent Auditor's Report.
THE EXPLANATION/ COMMENTS OF THE BOARD ON QUALIFICATION/ RESERVATION OR
ADVERSE REMARKS GIVEN BY AUDITORS IN ITS REPORT FOR THE FINANCIAL YEAR 2023-24:
Explanation of management on the audit qualifications contained in the
Auditors' Report are given in the statement of impacts of audit qualifications of the
financials.
COST AUDITORS:
As per Section 148 of the Companies Act, 2013, the Company is required
to have the audit of its cost records conducted by a Cost Accountant in practice. In this
connection, the Company appointed M/s Vijay Kumar Mishra & Associates; Cost
Accountant, as the Auditor of the Cost records of the Company for the year ending 31st
March, 2025. Further, as specified above, as the powers of the board stood suspended and
be exercised by the Interim Resolution Professional until replaced by Resolution
Professional. The Committee of Creditors also approved the appointment of M/s Vijay Kumar
Mishra & Associates, Cost Accountant, as the cost auditors of the Company for the year
ending 31st March, 2025, at a remuneration, subject to approval and ratification by the
shareholders, of Rs. 29,000 (Rupees Twenty-Nine Thousand Only) plus Taxes Plus out of
pocket expenses.
The cost audit report of M/s Vijay Kumar Mishra & Associates, Cost
Accountant, for the financial year 2023-24 does not contains any adverse qualification or
remarks.
COST AUDIT REPORT:
Pursuant to Section 148 of the Companies Act, 2013, read with The
Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records
maintained by the Company in respect of various activities are required to be audited. The
same had been audited by the Cost Auditor of the Company. The Board of Directors in their
meeting held on 8.11.2023, vide Resolution No. 191.14(2), had approved the Cost Audit
Report for the financial year 2022-23, and thereafter the cost audit report for the
financial year 2022-23 had been filed with ROC on 24.11.2023 vide SRN-F83128132.
PUBLIC DEPOSIT:
During the year, the Company has not accepted any deposits from the
public and as such. There are no outstanding deposits in terms of the Companies
(Acceptance of Deposits) Rules, 2014.
SHARE REGISTRATION ACTIVITY:
The Company has appointed "LINK INTIME INDIA PRIVATE LIMITED"
a category-I Registrar and Share Transfer Agent reregistered with Securities and Exchange
Board of India (SEBI) to handle the work related to Share Registry.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The particulars of loans, guarantees given, security provided and
investments made during the year as per Section 186 of the Companies Act, 2013 form part
of the notes and schedules of the Financial Statements provided in this Annual Report.
DIRECTORS' RESPONSIBILITY STATEMENT:
The Board of Directors acknowledge the responsibility for ensuring
compliance with the provisions of Section 134(3)(c) read with Section 134(5) of the
Companies Act, 2013, in the preparation of annual accounts for the year ended on 31st
March, 2024, and 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 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; e) 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; 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.
KEY MANAGERIAL PERSONNEL:
Mr. Sanjay Sharma, Chief Financial Officer, is the Key Managerial
Personnel of the Company.
CORPORATE GOVERNANCE:
A separate report on 'Corporate Governance' is enclosed as a
part of this Annual Report. The certificates from the Secretarial Auditor of the Company
regarding compliance with Corporate Governance norms stipulated under the regulations of
the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, are annexed
to the Report on Corporate Governance.
AUDIT COMMITTEE:
During the period under review but prior to the commencement of the
CIRP, the Audit Committee met three times. The details regarding the composition,
attendance and the date of Audit Committee are provided in the "Corporate
Governance Report". After the Commencement of CIRP the role and responsibilities
of the Board of Directors are being fulfilled by the Resolution Professional in accordance
with sections 17 and 23 of IBC Code and powers of the Board of Directors are suspended.
Hence, no meetings of the Audit Committee were held after the Commencement of CIRP, i.e.,
December 22, 2023.
NOMINATION AND REMUNERATION COMMITTEE:
During the period under review but prior to the commencement of the
CIRP, the Nomination & Remuneration Committee met once. The details regarding the
composition, attendance and the date of Nomination and Remuneration Committee are provided
in the "Corporate Governance Report". After the Commencement of CIRP the
role and responsibilities of the Board of Directors are being fulfilled by the Resolution
Professional in accordance with sections 17 and 23 of IBC Code and powers of the Board of
Directors are suspended. Hence, no meetings of the Nomination & Remuneration Committee
were held after the Commencement of CIRP i.e. December 22, 2023.
The Committee formulated Remuneration Policy which is attached as ANNEXURE
‘A' and forms a part of this Report of the Directors.
STAKEHOLDERS RELATIONSHIP COMMITTEE:
During the period under review but prior to the commencement of the
CIRP, the Stakeholders Relationship Committee met three times. The details regarding the
composition, attendance and the date of Stakeholders Relationship Committee are provided
in the "Corporate Governance Report". After the Commencement of CIRP the
role and responsibilities of the Board of Directors are being fulfilled by the Resolution
Professional in accordance with sections 17 and 23 of IBC Code and powers of the Board of
Directors are suspended. Hence, no meetings of the Stakeholders Relationship Committee
were held after the Commencement of CIRP i.e. December 22, 2023.
RISK MANAGEMENT COMMITTEE:
During the period under review but prior to the commencement of the
CIRP, the Risk Management Committee met two times. The details regarding the composition,
attendance and the date of Risk Management Committee are provided in the "Corporate
Governance Report". After the Commencement of CIRP the role and responsibilities
of the Board of Directors are being fulfilled by the Resolution Professional in accordance
with sections 17 and 23 of IBC Code and powers of the Board of Directors are suspended.
Hence, no meetings of the Risk Management Committee were held after the Commencement of
CIRP i.e. December 22, 2023.
SEXUAL HARASSMENT COMMITTEE:
As required under the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013, the Company has already constituted the
Internal Complaint Committees at all the work places of the Company. The composition of
the Committee and contact numbers of the persons to be approached have been uploaded on
the website of the company i.e. www.winsomeyarns.com and has been properly displaced on
the Notice Boards at all the premises of the Company, including works and head office. The
Committees have been regularly addressing the staff/ workers, particularly the female
staff/ workers to make them aware about their rights under the Act and as to how and to
whom the complaint, if any can be lodged.
The details of the sexual harassment cases received, disposed of and
pending are given below:-
Number of Sexual Harassment
Cases pending in the beginning of the Financial Year i.e. 01.04.2023 |
Number of Sexual Harassment
cases received during the Financial year 2023- 24 |
Number of Sexual Harassment
cases disposed off during the Financial year 2023-24 |
Number of Sexual Harassment
cases pending at the end of Financial year 2023-24 |
| NIL |
NIL |
NIL |
NIL |
VIGIL MECHANISM / WHISTLE BLOWER POLICY:
Pursuant to the provision of section 177(9) of the Companies Act, 2013,
and as required under the provisions of regulations of the Listing Regulation, 2015, the
Company has adopted the ‘Whistle Blower Policy‘ and authorized to the Audit
Committee of the Board to look after all the matters relating to Whistle Blower Policy and
to submit its report to Board at regular intervals, on the receipt of any concerned
matter, for any appropriate action. The details of the vigil mechanism Policy/ Whistle
Blower Policy are explained in the Corporate Governance Report and also posted on the
website of the Company. It can be accessed on www.winsomeyarns.com
RELATED PARTY TRANSACTIONS:
All transactions entered into with related parties as defined under the
Companies Act, 2013, and under the regulations of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, during the financial year were in the ordinary course of
business and on an arm's length pricing basis and do not attract the provisions of
Section 188 of the Companies Act, 2013. There were no materially significant related party
transactions with the Company's Promoters, Directors Management or their relatives,
which could have had a potential conflict with the interests of the Company. Transactions
with related parties entered by the Company in the normal course of business are
periodically placed before the Audit Committee for its review/approval under omnibus
approved route. There was no material contract or arrangement or transactions with Related
Party during the year. Thus, disclosure in form AOC-2 is not required. Suitable disclosure
as required by the Accounting Standard has been made in the notes to the Financial
Statements.
Related Party Transactions upto the date of commencement of CIRP were
placed before the Audit Committee and Board of the Company. Prior omnibus approval of the
Audit Committee and Board is obtained for the transactions which are of a foreseen and
repetitive nature. The transactions entered into pursuant to the omnibus approval so
granted are audited and a statement giving details of all related party transactions was
placed before the Audit Committee and Board for their approval on a quarterly basis.. The
policy on Related Party Transactions as approved by the Board is uploaded on the
Company's website (www.winsomeyarns.com). None of the Directors have had any
pecuniary relationship or transactions with the Company.
LISTING OF SHARES:
The Equity Shares of your Company are listed on National Stock Exchange
of India Limited (NSE) and Bombay Stock Exchange Limited (BSE). The Listing fee for the
financial year 2024-25 has been paid to BSE and NSE.
SIGNIFICANT AND MATERIAL ORDER:
The same is provided and explained under the heading of status of
corporate insolvency resolution process under insolvency and bankruptcy code 2016 (IBC)
after initiation.
RATINGS, AWARDS, ACHIEVEMENTS & RECOGNITIONS:
The data pertaining to the Credit Rating, awards, achievements is not
available.
INTERNAL FINANCIAL CONTROLS:
The Company has in place internal financial control systems,
commensurate with the size and complexity of its operations to ensure proper recording of
financial and operational information and compliance of various internal controls and
other regulatory and statutory compliances. The internal auditor monitors and evaluates
the efficacy and adequacy of internal control systems in the Company. Based on the report
of the internal auditor, respective departments undertake corrective action in their
respective areas and thereby strengthen the controls. Significant audit observations and
corrective actions thereon are presented to the Audit Committee of the Board.
MINI HYDRO POWER PROJECTS:
There are five mini hydro power projects of the Company situated at
Sidhwan Canal, Distt. Ludhiana, Punjab. The details of the same are as under:
Site Name in State of
Punjab |
Date of Commissioning |
Installed Generated
Capacity |
| Barewal |
Commissioned on 12th June, 2010 |
900 KW |
| Bharowal |
Commissioned on 12th January, 2013 |
750 KW |
| Isewal |
Commissioned on 15th July, 2011 |
900 KW |
| Mansian |
Commissioned on 22nd Sep., 2010 |
500 KW |
| Raowal |
Commissioned on 29th August, 2011 |
850 KW |
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO:
The information on conservation of energy, technology absorption and
foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies
Act, 2013 read with Rule 8(3) of The Companies (Accounts) Rules, 2014, is annexed as ANNEXURE
‘B'.
ENERGY SAVING INITIATIVES:
The Company is continually making its best efforts to save the energy
consumption. ENVIRONMENT AND POLLUTION CONTROL:
Top priority continues to be given to preservation of the environment
by all the units of the Company. To combat pollution and strengthen the area ecology,
considerable emphasis is placed on plantation of fragrant and shady trees. We are cautious
of preserving water through recycling and rainwater harvesting to the extent possible. All
manufacturing facilities possess the required environmental clearance from the respective
Pollution Control Boards and do comply with the relevant legislation.
The Company is well aware of its responsibility towards a better and
clean environment. Our efforts in environment management go well beyond mere compliance
with statutory requirements. The Company has always maintained harmony with nature by
adopting eco-friendly technologies and upgrading the same from time to time incidental to
its growth programs.
PARTICULARS OF EMPLOYEES:
The prescribed particulars of employees required under Rule 5(1) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached
as ANNEXURE ‘C' and forms a part of this Report of the Directors.
EXTRACT OF ANNUAL RETURN:
The annual return of the company will be available on the Company's
website www.winsomeyarns.com.
SECRETARIAL AUDIT:
Pursuant to the provisions of Section 204 of the Companies Act, 2013
and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the
Company has appointed M/s Girish Madan & Associates, a firm of Company Secretaries in
practice (C.P. No. 3577) to undertake the Secretarial Audit of the Company for the
financial year 2024-25. The Secretarial Audit Report (MR-3) for the financial year ended
31st March, 2024, is annexed as ANNEXURE 'D' to this Report.
WEBSITE:
Pursuant to the provisions of Regulation 46 of the Securities and
Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations,
2015, the Company is maintaining a website i.e. www.winsomeyarns.com.
CASH FLOW ANALYSIS:
In conformity with the provisions of regulations of Listing
Regulations, the Cash Flow Statement for the financial year is annexed with financial
statements.
INSURANCE:
The properties of the Company have been adequately insured against
fire, flood, earthquake and explosive risks etc.
ACKNOWLEDGEMENTS:
Your Directors thank the various Central and State Government
Departments, Organizations and Agencies for the continued help and co-operation extended
by them. The Directors also gratefully acknowledge all stakeholders of the Company viz.
customers, members, dealers, vendors, banks and other business partners for the excellent
support received from them during the year. The Directors place on record their sincere
appreciation to all employees of the Company for their unstinted commitment and continued
contribution to the Company.
ANNEXURE ‘A' REMUNERATION POLICY
Extract From Nomination and Remuneration Policy:
POLICY RELATING TO THE REMUNERATION FOR THE MANAGING DIRECTOR,
NON-EXECUTIVE/INDEPENDENT DIRECTOR, KMP AND SENIOR MANAGEMENT PERSONNEL.
General: a. The remuneration/ compensation/ commission etc.
to the Managing Director, Non-Executive/ Independent Director, KMP and Senior Management
Personnel will be determined by the Committee and recommended to the Board for approval.
The remuneration/ compensation/ commission etc. shall be subject to the prior/post
approval of the shareholders of the Company and Central Government, wherever required. b.
The remuneration and commission to be paid to the Managing Director shall be in
accordance with the percentage/ slabs/ conditions as per the provisions of the Companies
Act, 2013, and the Rules made thereunder. c. Increments to the existing
remuneration/ compensation structure linked to performance, should be clear and meet
appropriate performance benchmarks and may be recommended by the Committee to the Board
which should be within the slabs approved by the Shareholders in the case of Managing
Director. d. The Committee does not propose to fix the actual amounts of
remuneration that may be payable to each individual key managerial personnel or senior
management personnel. However, the management, whilst fixing the remuneration of any such
key personnel must consider the following: i) The Industry practice for the same level of
employment/office. ii) Past performance/seniority of the concerned appointee. iii) The
nature of duties and responsibilities cast upon such person by reason of his holding that
office. iv) The remuneration should be such that it provides adequate incentive to the
person to give his best to the Company and feel essence of high satisfaction with his
employment.
v) The perquisites to be given to Managing Director/s, KMP & Senior
Management Personnel will be as per industry practice and as may be recommended by the
Committee to the Board.
Remuneration to Managing Director, KMP and Senior Management Personnel:
The Managing Director/ KMP and Senior Management Personnel shall be
eligible for a monthly remuneration as may be approved by the Board on the recommendation
of the Committee. The break-up of the pay scale and quantum of perquisites including,
employer's contribution to P.F, pension scheme, medical expenses, club fees etc.
shall be decided and approved by the Board on the recommendation of the Committee and
approved by the shareholders and Central Government, wherever required, reflecting the
short and long term performance objectives appropriate to the working of the Company and
its goals.
Remuneration to Non-Executive / Independent Director: a. Remuneration/
Commission:
The Committee noted that if the Company's net profits computed for
the purpose under the applicable provisions of the Companies Act, 2013, so permits in
future, the commission may be paid to executive and non-executive directors within the
monetary limit fixed and approved by the Board subject to the overall limit not exceeding
1% of the net profits of the Company computed as per the applicable provisions of the
Companies Act, 2013. b. Sitting Fees:
The Non-Executive/ Independent Director may receive remuneration by way
of sitting fees for attending meetings of Board or Committees thereof as may be
recommended by the Committee and approved by the Board provided that the amount of such
fees shall not exceed amount prescribed by the Central Government from time to time. So
far as the Sitting Fees are concerned, presently, for meetings of the various Committees,
the same are at par for all the Committees which is per the industry practice.
ANNEXURE ‘B'
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO:
Information as required under Rule 8(3) of the Companies (Accounts)
Rules, 2014.
A. CONSERVATION OF ENERGY i) The steps taken or impact on conservation
of energy;
The Company has been giving high priority to conservation of energy by
close monitoring of energy consuming equipments. All efforts are made for installing
energy saving devices wherever required. ii) The steps taken by the company for
utilising alternate sources of energy;
The Company has already installed five micro hydel power projects with
total generation capacity of 3.90 MW and the power so generated is being adjusted in the
power bill raised by the concerned electricity department of Government of Punjab for
Derabassi plant. iii) The capital investment on energy conservation equipments;
Additional Investments, wherever required, are being made for reduction
of consumption of energy.
B. TECHNOLOGY ABSORPTION i) The Efforts made towards technology
absorption;
Research & Development (R&D) a) Specific area in which R&D
carried by the Company: - Latest new technology has been adopted. b) Future plan of
Action:
- This is an ongoing process and continuous improvements are being
carried out in the Plant & Machinery maintenance and the quality of finished products.
ii) The benefits derived like product improvement, cost reduction, product development
or import substitution;
- There has been benefit in respect of quality and Productivity of the
product. - Productivity International quality products. iii) In case of imported
technology (imported during the last three years reckoned from the beginning of the
financial year). --- Nil iv) The expenditure incurred on Research and Development.
| Capital |
Nil |
| Recurring |
Rs. 5.20 lacs |
| Total R & D expenditure as a percentage
of total turnover |
= 0.20 % |
C. FOREIGN EXCHANGE EARNING AND OUTGO; Rs.
in Lacs |
2023-24 |
2022-23 |
(a) Foreign exchange earned in terms
of actual inflow during the year |
10.58 |
6.89 |
(b) Foreign exchange outgo in terms of
actual outflow during the year |
176.39 |
39.98 |
ANNEXURE ‘C'
DETAILS PERTAINING TO REMUNERATION 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.
(i) The percentage increase in remuneration of each Director, Chief
Financial Officer and Company Secretary during the financial year 2023-24, ratio of the
remuneration of each Director to the median remuneration of the employees of the Company
for the financial year 2023-24 and the comparison of remuneration of each Key Managerial
Personnel (KMP) against the performance of the Company are as under:
(Amount in Rupees)
Sr. No. Name of Director/ KMP
and Designation |
Remuneration of Director/ KMP
for financial year 2023- 24 |
% increase in Remuneration
in the Financial year 2023-24 |
No. of times of remuneration
of each Person to median remuneration of employees |
Comparison of the
Remuneration of the KMP against the performance of the Company (as % of Revenue) |
1 Shri Manish Bagrodia Non-
Independent Director |
-- |
-- |
-- |
-- |
2 Mrs. Mridula Goyal Non-Independent
Director |
-- |
-- |
-- |
-- |
3 Shri Tilak Raj Dembla Independent
Director |
10000 |
-- |
0.63 |
-- |
4 Shri Rajiv Chadha Independent
Director |
25000 |
-- |
1.56 |
0.01 |
5 Pankaj Mahajan Appointed
as Independent Director on 22.05.2023 |
50000 |
-- |
3.13 |
0.02 |
6 Anupma Kashyap Appointed
as Independent Director on 22.05.2023 and resigned on 22.12.2023. |
45000 |
-- |
2.81 |
0.02 |
7 Shri Sanjay Sharma Chief
Financial Officer |
1072012 |
-- |
67.01 |
0.41 |
8 Ms. Neha Singhal Company
Secretary |
137888 |
-- |
8.62 |
0.05 |
(ii) The median remuneration of employees of the Company during
the financial year was Rs. 15,998.
(iii) In the financial year, there was an increase/(decrease) of
24.40% in the median remuneration of employees. (iv) There were 379 employees
of Company as on March 31, 2024.
(v) Relationship between average increase in remuneration and company
performance:-
The Loss after Tax for the financial year ended March 31, 2024, reduced
by 43.31% whereas the Increase/(decrease) in median remuneration was 24.40%. The average
median remuneration was in line with the average of salary in the industry.
(vi) Comparison of Remuneration of the Key Managerial
Personnel(s) against the performance of the Company:- (Rs. in lacs)
| Average remuneration of Key Managerial
Personnel (KMP) in 2023-24 |
6.05 |
| Revenue |
2640.39 |
| Aggregate Remuneration of KMP (as % of
revenue) |
0.23% |
| Profit/ (Loss) before Tax (PBT) |
-1094.24 |
| Remuneration of KMP (as % of PBT) |
N.A. |
(vii) a) Variations in the market capitalization of the Company: As on
31.03.2024, the closing price of shares on BSE and NSE was Rs. 2.95. The market
capitalization as on March 31, 2024, was Rs. 20.86 crore. b) Price Earnings Ratio of the
Company as at March 31, 2024, was Rs. (-) 1.39 and as at March 31, 2023 was Rs. (-)3.74.
c) Percent increase over/ decrease in the market quotations of the shares of the company
as compared to the rate at which the company came out with the last public offer. The
Company has not made any public issue or rights issue of securities in the recent past, so
comparison have not been made of current share price with public offer price. The
Company's shares are listed on BSE Limited and National Stock Exchanges of India
Limited.
(viii) Average percentage increase made in the salaries of employees in
the financial year i.e. 2023-24 was about 11.95%, whereas the increase in the key
managerial remuneration for the same financial year was also 24.69%. (ix) There are no
variable component of remuneration availed by the directors. (x) The ratio of the
remuneration of the highest paid director to that of the employees who are not directors
but receive remuneration in excess of the highest paid director during the year. –
Not Applicable (xi) It is hereby affirmed that the remuneration paid is as per the
Remuneration Policy for Directors, Key Managerial Personnel and other Employees.
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