Dear Shareholders,
The Hon'ble National Company Law Tribunal,
(‘‘NCLT''), had vide its order dated December 20, 2022 admitted the
application for the initiation of the corporate insolvency resolution process
("CIRP") against Sumeet Industries Limited ("Company")
("Admission Order") in terms of the Insolvency and Bankruptcy Code, 2016 read
with the rules and regulations framed thereunder, as amended from time to time
("Code"). Mr. Kuresh Hatim Khambati (having registration number
IBBI/IPA-001/IP-P-01521/2018- 19/12454) had been appointed as an Interim Resolution
Professional under the provisions of Code vide the admission Order. As per Section 17 of
the Code, on commencement of the Corporate Insolvency Resolution Process (CIRP), the
powers of the Board of Directors of the Company stand suspended and the same have been
vested with Mr. Kuresh Hatim Khambati as the Interim Resolution Professional.
Subsequently, vide NCLT order dated 15th February, 2022
appointed Mr. Satyendra P. Khorania (Reg. No. IBBI/IPA-002/IP-N00002/2016-17/10002) as
Resolution Professional ("RP") to act Resolution Professional in place of Mr.
Kuresh Hatim Khambati in terms of the provisions of the Code.
The powers of Board of Directors of the Company stand suspended
effective from the CIR Process commencement date and such powers along with the management
of affairs of the Company are vested with the RP in accordance with the provisions of
Section 17 and 23 of the Insolvency Code read with Regulation 15(2A) & (2B) of the
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015 ("SEBI Listing Regulations").
The financial performance of the Company (Standalone and Consolidated )
for the financial year ended 31st March, 2023 is summarized below :-
FINANCIAL RESULTS :
(Rs. in Lakh)
| Particulars |
Standalone |
Consolidated |
|
2022-23 |
2021-22 |
2022-23 |
2021-22 |
| Sales & Income from operation |
103312.41 |
89350.44 |
103312.41 |
89350.44 |
| Other Income |
1022.58 |
2099.88 |
1022.58 |
2099.64 |
| Profit ( Loss )before Financial cost, |
|
|
|
|
| Depreciation and Exceptional items & Tax (EBITDA) |
(2920.35) |
5529.20 |
(2920.35) |
5519.52 |
| Interest |
705.57 |
2654.51 |
705.57 |
2654.51 |
| Depreciation |
2749.24 |
3140.99 |
2749.24 |
3140.99 |
| Profit/(Loss) before Exceptional and |
|
|
|
|
| Extraordinary items |
(6375.16) |
(266.30) |
(6375.16) |
(275.98) |
| Exceptional & Extraordinary items |
(1.80) |
(3.55) |
(1.80) |
(3.55) |
| Profit/(Loss) before Tax |
(6376.96) |
(269.85) |
(6376.96) |
(279.53) |
| Provision for Taxation |
|
|
|
|
| Current tax |
|
|
|
|
| Mat Credit |
|
|
|
|
| Deferred Tax |
(504.81) |
(570.91) |
(504.81) |
(570.91) |
| Profit after Tax |
(5872.15) |
301.06 |
(504.81) |
291.38 |
| Taxation for previous year profit available for appropriation |
|
|
|
|
| Dividend on Equity & Pref. Shares |
|
|
|
|
| Transfer to General Reserve |
(5872.15) |
301.06 |
(5872.15) |
291.38 |
OPERATIONS
During the year under review, the Company witnessed up trend in demand
coupled with rising power and fuel and raw material & other costs that impacted the
overall profitability. Despite the challenges, the Company ensured continuous supply of
products in the markets and sales has been achieved more than 15% in comparison to the
previous year.
The Company has produced 97530.09 Tons of Pet Chips/Polyester and
Texturized Yarn and dispatched 100500.89 Tons of Pet Chips / Polyester and Texturized
yarns.
Income from operation (Consolidated) of the company has increased from
Rs. 893.50 Crores to Rs.1033.12 Crores. The Company has incurred Consolidated Loss of Rs.
58.72 Crores against profit of Rs. 2.91 Crores in previous year. We are reassessing our
strategies in line with the larger macro picture and have made some significant changes to
drive our growth focussed and opportunity driven strategies.
A detailed analysis of the operations of your Company during the year
under report is included in the Management Discussion and Analysis Report, forming part of
this Annual Report.
DIVIDEND
The Board of directors do not recommended dividend for the year under
review due to loss incurred by the company.
CORPORATE INSOLVENCY RESOLUTION PROCESS (CIRP)
A petition for initiation of Corporate Insolvency Resolution Process
under Section 7 of the Insolvency and Bankruptcy Code, 2016 filed by IDBI Bank Ltd.
(Financial Creditor) has been admitted against the Company vide Honorable National Company
Law Tribunal, Ahmedabad bench order dated 20.12.2022 and Mr. Mr. Kuresh Hatim Khambati has
been appointed as Interim Resolution Professional by Hon'ble bench of NCLT, Ahmedabad
under section 13(1)(c) of the Insolvency and Bankruptcy Code, 2016.
Later on petition moved by the Lead Bank i.e. Bank of Baroda, for
replacement of RP and the Hon'ble Bench of NCLT vide order dated 15th February, 2023
appointed Mr. Satyendra P. Khorania (Reg. No. IBBI/IPA-002/IP-N00002/2016-17/10002) as
Resolution Professional ("RP") to act Resolution Professional in place of Mr.
Kuresh Hatim Khambati in terms of the provisions of the Code.
MATERIAL CHANGES AND COMMITMENTS
The company evaluates events and transactions that occur subsequent to
the balance sheet date but prior to the financial statements to determine the necessity
for recognition and/or reporting of any of these events and transactions in the financial
statements.
There have not been any material changes and commitments affecting the
financial position of the Company between the end of the financial year as on 31st March,
2022 and the date of this report, i.e.10.08.2023.
OVERSEAS SUBSIDIARY COMPANY
The company has a wholly owned subsidiary company named "Sumeet
Global Pte Limited" incorporated at Singapore in the year 30.09.2012 registered
with Registrar of Companies and Business, Singapore. Pursuant to Accounting Standard AS-21
issued by the Institute of Chartered Accountants of India and the provisions of the
Listing Agreement with Stock Exchanges, the company has prepared Consolidated Financial
Statements of the Company and its subsidiaries are included in the Annual Report. There
were no any business activities is going on at Singapore Branch.
M/s. S. Renganathan & Co, Chartered Accountants, Singapore address
at 101, Cecil Street, #23-06 Tong Building, Singapore -069533 has been appointed as
Statutory Auditor of the overseas subsidiary company on dated 13.10.2022.
Pursuant to Section 129(3) of the Act, a statement containing salient
features of the Financial Statements of the subsidiary in the prescribed Form AOC-1 as Annexure:2
forms part of the Annual Report.
Pursuant to the provision of section 136 of the Act, the financial
statements of the company, consolidated financial statements along with the relevant
documents and separate audited accounts in respect of Sumeet Global Pte Limited are
available on the website of the company.
EXPORTS
The company has been exploring all the possibilities for exporting its
products. During the year under review, your company has exported products worth of Rs.
454.21 Lakhs (P.Y. Rs. 4488.90 Lakhs).
DEPOSITORY SYSTEM
As members are aware, the company's shares are compulsorily
tradable in the electronic form. As on March 31, 2022 almost 97.78% of the Company's
total paid-up capital representing 10,13,36,411 shares were in dematerialized form. In
view of the numerous advantages offered by the Depository system, members holding shares
in physical mode are advised to avail of the facility of dematerialization on either of
the Depositories.
FIXED DEPOSITS
The Company has invited deposits from public in accordance with the
Section 73 and 74 of the Companies Act, 2013 (corresponding Section 58 A of the Companies
Act, 1956) to the tune of Rs. 396.14 Lakh during the financial year 2013-14. No fresh
deposits have been invited and nor any deposits have been renewed in the financial year
2022-23. Total outstanding deposits after repaying on maturity as on 31.03.2023 has been
remained Rs.2,90,000.00. There were no deposits, which were claimed but not paid by the
Company as on date.
DIRECTORS APPOINTMENT
Mr. Shankarlal Somani (DIN No.00165238), Executive Director of the
Company, retire by rotation at the ensuing Annual General Meeting and being eligible,
offer himself for re-appointment.
The Board recommends the re-appointment of Mr. Shankarlal Somani as
Director for the consideration of the members of the Company at the ensuing Annual General
Meeting. The brief resume of the Director and other related information has been provided
in the notes to the Notice convening 35th Annual General Meeting (AGM) of the
Company.
AUDITORS
a) Statutory Auditors
In compliance with the Companies (Audit and Auditors) Rules, 2014, the
Members, at the 32nd Annual General Meeting of the Company held on 17th day of September,
2020 has appointed M/s. H. Tosniwal & Co., Chartered Accounts (Firm Registration no.
111032W), as a Statutory Auditors of the Company to hold the office until the conclusion
of the 35th Annual General Meeting of the Company.
The present term of the Statutory Auditors will be completed on the
conclusion of 35th Annual General Meeting of the Company scheduled to be held on September
27, 2023. The Board of Directors at their meeting held on 30th Day of May, 2023
has decided to continue to appoint M/s. H. Tosniwal & Co., Chartered Accounts (Firm
Registration no. 111032W), as a Statutory Auditors of the Company who holds office upto
the conclusion of this Annual General Meeting, be and are hereby re-appointed as Statutory
Auditors of the Company for the period of three (3) consecutive financial years commencing
from the conclusion of 35th Annual General Meeting till the conclusion of 38th
Annual General Meeting subject to the approval of Shareholders at ensuing Annual General
Meeting.
The Company has received a certificate from them to the effect that
their appointment as Statutory Auditors of the Company, would be within the limit
prescribed u/s 139 & 141 of the Companies Act, 2013 & also received a peer review
certificate issued by the ICAI ‘Peer Review Board', as required under the
provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
There have been no instances of fraud reported by the Statutory Auditors under Section 143
(12) of the Act and Rules framed there under.
In the Report dated 30th May,2023 of the company, M/s. H. Tosniwal
& Co, Chartered Accountant has given a qualified opinion in relation to the Financial
Statements of the company for the Financial year ended 31st March 2023.
Statement on Impact of Audit Qualifications for the year under review is annexed as Annexure
- 6. The Board's response in relation to the said opinion is as under: -
| Sl. No |
Audit-Qualification |
Board's Response |
| 1. |
1) The company has not created any provision for interest on
loan taken from bank and financial institutions for the year ending 31.03.2023 and had
paid only interest of Rs.5,75,16,938/- for 3 months out of the total period. The financial
impact is not quantifiable as the provision amount cannot be ascertained based on the
material existing. |
In the meeting held on 19th February 2022 of Joint Consortium
Lenders, it was proposed that on continuing sustainable debts of Rs. 376.42 Crores,
interest to be charged as per rate proposed in the meeting. Accordingly, the company has
booked interest amount of Rs. 5.75 Crores in the books of accounts for three months
(01.04.2022 to 30.06.2022) shown under Finance cost on the basis of interest proposed as
per plan approved in JLM meeting. From 01.07.2022 onwards, the company has not made any
provision for interest being NPA status of the company. |
|
|
The Interest is not provided on balance amount of
unsustainable debts as mentioned in the audit qualification. |
|
|
Pursuant to the Order dated 20th December, 2022 of
the Hon'ble National Company Law Tribunal, Ahmedabad ("NCLT Order"),
Corporate Insolvency Resolution Process ("CIR Process") has been initiated
against the Company |
|
2) The company has not created provision for Interest
amounting to Rs. 69, 83, 207/- on delayed payment of MSME dues resulting in overstatement
of profit. |
Provision for Interest on delayed payment to MSME has not
been provided because most of payment is delayed due to disputes standing with parties in
terms of quality issue, rate differences, discounts etc which were remained unresolved
from the parties. Management is taking clarification from the department concerned and
instructed to clear the dues to concerned MSME parties after settle the issues. |
Emphasis of matter in Audit Report:
| Sl. No. |
Emphasis of matter |
Board's Response |
| 1. |
As mentioned in point no. 31 of the Standalone Financial
Statement, Creditors were called upon to submit the financial claims., The Resolution
Professional has examined and admitted the claims from Secured Financial Creditors
amounting to Rs. 583.48 Cr, Unsecured Financial Creditors amounting to Rs. 107.61 Cr and
from Operational Creditors (other than Workmen, Employees and Government dues) amounting
to Rs. 36.64 Cr. The variations between balances as per books and amount claimed by the
Secured financial creditors is due to charging of interest and other charges claimed by
the financial creditors and by unsecured financial creditors amounting is due to claim by
Bank of Baroda against Corporate Guarantee by Company to overseas subsidiary |
1) Due to pending outcome of the Crip, no accounting impact
in the books of accounts has been given in respect of excess, short, or non-receipts of
claims for operational and financial creditors. Hence consequential impact, if any, on the
financial statements is currently unascertainable. |
|
|
2) We have been informed by Resolution Professional that the
certain information including the minutes of the meeting of the Committee of Creditor and
the outcome of certain procedures carried out as a part of the CIRP are confidential in
nature and could not be shared with anyone other than the Committee of Creditors and NCLT.
Accordingly, we are unable to comment on the possible financial impact, presentation and
disclosure, if any, that may arise if we have been provided access to those information. |
b) Cost Auditors
The Company has been maintaining cost accounting records in respect of
manufacture of Polyester yarns pursuant to directives of the Central Government. The
company has appointed M/s. V.M. PATEL & ASSOCIATES, (Firm Registration No. 10519) as
Cost Auditors, for conducting the audit of cost records for the financial year 2023-24 and
approval of the members is being sought for ratification of their appointment and
remuneration.
c) Internal Auditors
The Board has appointed M/s. A R V P & Co., Chartered Accountants (
ICAI Registration Number: 101482W ) as Internal Auditors of your company for the financial
year 2023-24. The report prepared by the Internal Auditors is to be reviewed by the
Statutory Auditors & Audit Committee of the company.
d) Secretarial Auditors
M/s. Dhirren R. Dave, Practising Company Secretaries (CP No. 2496,
Membership No. 4889) were appointed as Secretarial Auditor, to conduct secretarial audit
of the company for the financial year 202223. The Secretarial Audit Report for the
financial year ended 31st March, 2023 is annexed herewith and forms part of the Annual
Report as Annexure-1. The Secretarial Audit Report contains qualification,
reservation or adverse remark.
The Board has re-appointed Dhirren R. Dave & Co., Company
Secretaries, as Secretarial Auditor of the Company for the financial year 2023-24.
CREDIT RATING
During the year under review, no credit rating has been obtained from
any credit rating agency.
MANAGEMENT DISCUSSION AND ANALYSIS
In terms of Regulations 34 of the Listing regulations, a separate
section on Management Discussion and Analysis and Corporate Governance Report together
with a certificate from the Company's Statutory Auditors confirming compliance with
regulations relating to Corporate Governance of the Listing regulation is set out and
forms part of this Annual report.
CONSOLIDATED FINANCIAL STATEMENTS
In accordance with provisions of sub-section (3) of Section 129 of the
Act and the Listing Regulations, the Consolidated Financial Statements of the company,
including the financial details of the subsidiary company forms part of this Annual
report. The Consolidated Financial Statements have been prepared in accordance with the
Accounting Standards prescribed under Section 133 of the Act.
PERSONNEL AND RELATED DISCLOSURES
The Board of Directors wishes to express their appreciation to all the
employees for their outstanding contribution to the operations of the company. Pursuant to
the provisions of the Companies (Appointment & Remuneration of Managerial Personnel)
Rules 2014, no employee is drawing remuneration in excess of the prescribed limits. Your
company also appreciates that revenue and profit growth cannot take place without the
right equality of people. To that effect, your company has undertaken a series of measures
that ensures the most appropriate people are recruited in to the organization.
Disclosures pertaining to remuneration and other details as required
under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 are provided in Annexure-3 forming
part of the Annual Report.
INTERNAL CONTROL SYSTEM
Your Company has put in place adequate internal financial controls with
reference to the financial statements. The Board has adopted the policies and procedures
for ensuring the orderly and efficient conduct of its business including adherence to the
Company's policies, the safeguarding of its assets, prevention and detection of
frauds and errors, accuracy and completeness of the accounting records and timely
preparation of reliable financial disclosures. During the year, such controls were tested
and no reportable material weaknesses in design or operation and fraud were observed. 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, the 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.
CORPORATE SOCIAL RESPONSIBILITY
Corporate Social Responsibility (CSR) is an integral part of the
Company's ethos and policy and it has been pursuing on a sustained basis. The Company
has assisted schools situated at nearby villages by distributing dresses & books among
poor students and computers nearby situated primary schools etc. Technical education and
training are imparted to the employees through Industrial Training and Workshops. Emphasis
was laid on creation of awareness amongst the villagers about the need to protect the
environment. CSR activities carried out by the Company have strengthened the relationship
with local people. The main focus areas taken in the policy are Education, Health Care,
Animal Care, Environment safety, contribution to any relief fund set up by Government,
Semi-Governments etc.
The brief outline of the Corporate Social Responsibility (CSR) Policy
of the company and the initiatives undertaken by the company on CSR activities during the
year are set out in Annexure of this Report in the format prescribed in the Companies
(Corporate Social Responsibility Policy) Rules 2014 as provided in Annexure- 4. The
Policy is available on the website of the Company. Since the company has been making
losses since last 4 years so it is not participating much in CSR activities.
HUMAN RESOURCES & INDUSTRIAL RELATIONS
We continued imparting team building and collaboration training to our
workmen to enhance the team cohesiveness. The total employee strength was 614 as on 31st
March, 2023.
We continue to step up efforts to accelerate our value-based growth
strategy and the overall development of human capital. We nurture our people by investing
in their empowerment through learning and development, wellness, and safety besides
providing contemporary workplace facilities.
PREVENTION OF SEXUAL HARASSMENT POLICY
The Company has in place Prevention of Sexual Harassment Policy in line
with the requirements of The Sexual Harassment of Women at Workplace (Prevention,
Prohibition & Redressal) Act, 2013. All employees (permanent, contractual, temporary,
trainees) are covered under this policy.
Your Directors state that during the year under review, there were no
cases filed and reported in pursuant to The Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013.
RISK MANAGEMENT
Risk Management is the systematic process of understanding, measuring,
controlling and communicating organization's risk exposures while achieving its
objectives. Risk Management is an important business aspect in the current economic
environment and its objective is to identify, monitor
and take mitigation measures on a timely basis in respect of the events
that may pose risks for the business. The Company's risk-management strategy is to
identify, assess and mitigate any significant risks. We have established processes and
guidelines, along with a strong overview and monitoring framework at the Board and Senior
Management levels.
The key risks identified by the Company include, cyber security and
data protection risk, financial & economic risk, competition risk, operational risk
and compliance of all applicable statutes and regulations.
The Board of Directors regularly review risks and threats and takes
suitable steps to safeguard its interest. The focus shifts from one area to another area
depending upon the prevailing situation. A detailed report on significant risks and
mitigation is forming part of Management's Discussion and Analysis.
SAFETY, HEALTH & ENVIRONMENT
Safety & Health of the employees have always assumed the highest
importance in your company. The management is committed to ensure zero harm to its
employees and to all persons within the Company premises. Safety and occupational health
responsibilities are integral to the Company's business processes, as spelt out in
the Company's Safety, Health and Environment Policies and Procedure.
INSURANCE
All the properties of the Company including buildings, plant and
machineries and stocks have been adequately insured.
LOANS, GUARANTEES OR INVESTMENT MADE UNDER SECTION 186 OF THE COMPANIES
ACT, 2013
The loans given, investments made and guarantees given & securities
provided during the year under review, are in compliance with the provisions of the Act
and rules made there under and details thereof are given in the notes to the Standalone
Financial Statements.
DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUB-SECTION
(12) OF SECTION 143 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT
During the year under review, the Statutory Auditors, Cost Auditors and
Secretarial Auditors have not reported any instances of frauds committed in the Company by
its Officers or Employees, to the Audit Committee under Section 143(12) of the Act,
details of which needs to be mentioned in Director's Report.
EMPLOYEE STOCK OPTION
The company has not issued any equity shares under Employee Stock
Option during the year.
FOREIGN EXCHANGE TRANSACTIONS
In order to hedge the company's exposure to foreign exchange and
interest rate, the company enters into forward contracts. The volatility witnessed in the
global markets has reiterated the need for robust forex management systems and prudent
investment practices. All forex exposures are hedged upon the occurrence of an exposure.
In case of liabilities in respect of foreign currency loans obtained for acquisition of
fixed assets, the variation in the liabilities arising out of exchange rates at the year
end have been capitalized during the year as per Companies (Accounting Standard) Amendment
Rules, 2009.
ENERGY, TECHNOLOGY AND FOREIGN EXCHANGE
Information in accordance with the provisions of Section 134 (3) (m) of
the Companies Act, 2013 regarding conservation of energy, technology absorption and
foreign exchange earnings and outgo is given in the Annexure- 5, forming part of
the report.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:
The Hon'ble National Company Law Tribunal, ("NCLT''),
had vide its order dated December 20, 2022 admitted the application for the initiation of
the corporate insolvency resolution process ("CIRP") agains Sumeet Industries
Limited ("Company") ("Admission Order") in terms of the Insolvency and
Bankruptcy Code, 2016 read with the rules and regulations framed thereunder, as amended
from time to time ("Code").
RELATED PARTY TRANSACTIONS:
All revised related party transactions that were entered into during
the financial year were in the ordinary course of business and were on an arm's
length basis. There are no materially significant related party transactions entered into
by the Company with Promoters, Directors, Key Managerial Personnel or othei related
parties which may have a potential conflict with the interest of the Company at large.
During the year, the Company has not entered into related party transactions which could
be considered as material in accordance with the Policy on Related Party Transactions of
the Company.
Accordingly, the disclosure of related party transactions as required
under section 134(3)(h) of the Companies Act, 2013 in Form AOC -2 is not applicable to
your Company. All related party transactions for the year are placed before the Audit
Committee as well as before the Board for approval. The transactions entered into with
related parties are reviewed on a quarterly basis by the Audit Committee.
The Policy on Related Party Transactions as approved by the Audit
Committee and Board is uploaded on the Company's website at the link https://
www.sumeetindustries.com. Members can refer to Note (24) Related parties transactions
under Notes to Financial Statements to the Standalone Financia Statements which sets out
related party disclosures.
CORPORATE GOVERNANCE
The Company is committed to maintain the highest standards of corporate
governance and adhere to the corporate governance requirements set out by Securities and
Exchange Board of India (SEBI). A separate report on Corporate Governance along with
Certificate from M/s. H Tosniwal & Co., Charterec Accounts on compliance with the
conditions of Corporate Governance as stipulated under SEBI (Listinc Obligations &
Disclosure Requirements) Regulations, 2015 is provided as part of this Annual Report.
EXTRACT OF ANNUAL RETURN
Pursuant to Section 134(3)(a) and Section 92(3) of the Act read with
Companies (Management and Administration) Rules, 2014, the Annual Return of the Company in
Form MGT-7 has been placed on the Company's website link:
http://www.sumeetindustries.com/wp- content/uploads/2023/07/Form MGT 7 2023.pdf
DIRECTORS' RESPONSIBILITY STATEMENT
In accordance with the provisions of Section 134(5) of the Companies
Act, 2013, the Board hereby submits its responsibility Statement:
(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 judgements 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.
CODE OF CONDUCT
As prescribed under the provisions of Section 149 of the Companies Act,
2013 read with Schedule IV thereto and Regulation 26 of the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 for its Board of Directors and senior
management and employees, the Company has formulated a comprehensive Code of Conduct (the
Code). The Code is applicable to Directors and senior management and employees to such
extent as may be applicable to them depending upon their roles and responsibilities. The
Code gives guidance and support needed for ethical conduct of business and compliance of
law. The Code reflects the values of the Company viz. Customer Value, Integrity, one team
and Excellence.
A copy of the Code has been uploaded on the Company's website
www.sumeetindustries.com. The Code has been circulated to all the Directors and Management
Personnel and its compliance is affirmed by them annually.
A declaration signed by the Company's Managing Director for the
compliance of this requirement is published in this Report.
CODE OF CONDUCT TO REGULATE, MONITOR AND REPORT TRADING BY INSIDERS
In terms of SEBI (Prohibitions of Insider Trading) Regulations, 2015,
as amended from time to time, the Company has adopted a Code of Conduct for Prevention of
Insider Trading (Insider Code) as approved by the Company's Board. Any Insiders (as
defined in Insider Code) including designated employees & persons and their relatives
are, inter-alia, prohibited from trading in the shares and securities of the Company or
counsel any person during any period when the "unpublished price sensitive
information" are available with them. The Insider Code also requires pre-clearance
for dealing in the Company's shares and prohibits dealing in Company's shares by
the Directors and the designated employees while in possession of unpublished price
sensitive information in relation to the Company and during the period when the Trading
Window is closed.
A structured digital database is being maintained by the company under
guidance with Registrar and Transfer Agents (RTA) of the Company, which contains the names
and other particulars as prescribed of the persons covered under the Codes drawn up
pursuant to the Prohibition of Insider Trading Regulations. We have also adopted an
automated tracking system to monitor insider trading, generating reports and sending
reminders to employees about prohibited transactions, if any occurs.
COMPLIANCE WITH SECRETARIAL STANDARDS
The Board of Directors affirms that the Company has complied with the
applicable Secretarial Standards issued by the Institute of Company Secretaries of India
which have mandatory application during the year under review.
DECLARATION OF INDEPENDENCE BY THE INDEPENDENT DIRECTORS
Pursuant to Section 149(6) of the Companies Act, 2013, Independent
Directors of the Company have made a declaration confirming the compliance of the
conditions of the independence stipulated in the aforesaid section.
WHISTLE BLOWER MECHANISM
In order to ensure that the activities of the Company and its
directors, employees and Vendors are conducted in a fair and transparent manner by
adoption of highest standards of professionalism, honesty, integrity and ethical
behaviour, the Company has adopted a Vigil mechanism/Whistle Blower Policy. This policy is
explained in Corporate Governance Report and also uploaded on the website of the company
i.e. www.sumeetindustries.com.
DISCLOSURE RELATED TO BAORD, COMMITTEES AND POLICIES
A) BOARD MEETINGS:
The Board of Directors met 8 times during the financial year ended 31st
March, 2023 in accordance with the provisions of the Companies Act, 2013 and rules made
there under. The details thereof are given in the Corporate Governance Report forming part
of the Annual report.
B) COMMITTEE MEETINGS:
AUDIT COMMITTEE
The Audit Committee of the Company has been constituted in line with
the provisions of Regulation 18 of the Listing Regulation read with Section 177 of the
Companies Act, 2013. All members of the Audit Committee are financially literate and have
relevant experience in financial matters. During the year the Audit Committee of the
Company consisted of three members viz; Mr. Manojkumar Ganeshmal Jain, Mr. Sumeet
Shankarlal Somani, Mr. Saurav Santosh Dugar, consisting of 1 Executive Director and 2 Non-
Executive and Independent Directors. Mr. Manojkumar Ganeshmal Jain is the Chairman of the
Audit Committee.
All recommendations made by the Audit Committee were accepted by the
Board during the year 202223. Pursuant to the Order dated 20th December, 2022
of the Hon'ble National Company Law Tribunal, Ahmedabad ("NCLT Order"),
Corporate Insolvency Resolution Process ("CIR Process") has been initiated
against the Company in accordance with the provisions of the Insolvency and Bankruptcy
Code, 2016, ("Code") and related rules and regulations issued thereunder and
thereby powers of the Board/ Committee stand suspended w.e.f. 20.12.2022 and be exercised
by IRP/RP.
The brief details of the Audit Committee are given in Corporate
Governance Report forming part of the Annual report.
NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee and the Policy are in
compliance with Section 178 of the Companies Act, 2013 read along with the applicable
rules thereto and Listing Regulations (as may be amended from time to time). Emphasis is
given to persons from diverse fields or professionals. The Nomination and Remuneration
Committee comprises of three members viz; Mr. Manojkumar Ganeshmal Jain, Mr. Vikashkumar K
Chandaliya and Mr. Saurav Santosh Dugar, consisting of 3 Non-Executive Directors. Mr.
Manoj kumar Ganeshmal Jain is the Chairman of the Nomination and Remuneration Committee.
Pursuant to the Order dated 20th December, 2022 of the
Hon'ble National Company Law Tribunal, Ahmedabad ("NCLT Order"), Corporate
Insolvency Resolution Process ("CIR Process") has been initiated against the
Company in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016,
("Code") and related rules and regulations issued thereunder and thereby powers
of the Board/ Committee stand suspended w.e.f. 20.12.2022 and be exercised by IRP/RP.
The Nomination and remuneration Committee has framed the
"nomination & Remuneration and Evaluation Policy" can be accessed
http://www.sumeetindustries.com/wp-
content/uploads/2016/04/Nomination-Remuneration-and-Evaluation-Policy.pdf and
"Policy on Board Diversity" can be accessed
http://www.sumeetindustries.com/wp-content/uploads/2016/04/Policy-on-
Board-Diversity.pdf
The brief details of the Nomination and Remuneration Committee are
given in Corporate Governance Report forming part of the Annual report.
STAKEHOLDERS RELATIONSHIP COMMITTEE
The Committee is constituted in line with the provisions of Regulation
20 of the SEBI Listing Regulations read with Section 178 of the Companies Act, 2013.. The
Stakeholders Relationship Committee now comprises of three members viz; Mr. Manojkumar
Ganeshmal Jain, Mr. Sumeet Shankarlal Somani and Mr. Vikashkumar K Chandaliya, consisting
of 1 Executive Director and 2 Non-Executive Directors. Mr. Manojkumar Ganeshmal Jain is
the Chairman of the Stakeholders Relationship Committee.
Pursuant to the Order dated 20th December, 2022 of the
Hon'ble National Company Law Tribunal, Ahmedabad ("NCLT Order"), Corporate
Insolvency Resolution Process ("CIR Process") has been initiated against the
Company in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016,
("Code") and related rules and regulations issued thereunder and thereby powers
of the Board/ Committee stand suspended w.e.f. 20.12.2022 and be exercised by IRP/RP.
The brief details of the Stakeholders Relationship Committee are given
in Corporate Governance Report forming part of the Annual report.
CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
The Board has laid down the Company's policy on Corporate Social
Responsibility (CSR) and the CSR activities of the company are carried out as per the
instructions of the Committee. The CSR Committee now comprises of three members viz; Mr.
Sumeet Shankarlal Somani, Mr. Manojkumar Ganeshmal Jain, Mr. Vikashkumar K Chandaliya,
consisting of 1 Executive Director and 2 Non-Executive Directors. Mr. Sumeet Shankarlal
Somani is the Chairman of the CSR Committee.
Pursuant to the Order dated 20th December, 2022 of the
Hon'ble National Company Law Tribunal, Ahmedabad ("NCLT Order"), Corporate
Insolvency Resolution Process ("CIR Process") has been initiated against the
Company in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016,
("Code") and related rules and regulations issued thereunder and thereby powers
of the Boad/ Committee stand suspended w.e.f. 20.12.2022 and be exercised by IRP/RP.
The brief details of the Corporate Social Responsibility Committee are
given in Corporate Governance Report forming part of the Annual report.
BOARD EVALUATION
Pursuant to the provisions of the Companies Act, 2013 and Listing
Regulations, the Board has carried out an annual performance evaluation of its own
performance, the Directors individually as well as the evaluation of the working of its
Audit Committee, Nomination and Remuneration Committee.
The evaluation process covered the aspects which included Board
structure and composition, frequency of Board meetings, participation in the long term
strategic planning, contribution to and monitoring of corporate governance practices and
the fulfilment of Directors' obligation and fiduciary responsibilities, including but
not limited to, active participation at the Board and committee meetings.
This evaluation is led by the Chairman of the Board Governance,
Nomination and Remuneration Committee with specific focus on the performance and effective
functioning of the Board. The result of the evaluation is satisfactory and adequate and
meets the requirement of the Company.
FAMILIAZATION PROGRAMME FOR INDEPENDENT DIRECTORS
In compliance with the requirements of Listing Regulations, the Company
has put in place a Familiarization Programme for Independent Directors to familiarize them
with the workings of the Company, their roles, rights and responsibilities vis-a-vis the
Company, the industry in which the company operates, business model etc. along with
updating on various amendments in the Listing Regulations and the Companies Act, 2013. The
policy on Familiarization Programme is uploaded on the website of the Company and can be
accessed through web link http://www.sumeetindustries.com/wp-
content/uploads/2016/04/Familirisation-of-Independent-Director.pdf
KEY MANAGERIAL PERSONNEL
In terms of Section 203 of the Companies Act, 2013 & section 2(51)
of the Companies Amendment Act, 2017, the following are designated as Key Managerial
Personnel of your Company by the Board:
| SL No. Name |
Designation |
| 1. Sumeet Kumar Somani |
Mg. Director (Suspended) |
| 2. Anil Kumar Jain |
Company Secretary |
| 3. Abhishek Prasad |
C.F.O. |
ACKNOWLEDGEMENT
Your Directors would like to express their grateful appreciation for
the assistance and co-operation received from the Financial Institutions, Banks,
Government Authorities and Shareholders during the year under review. Your Directors wish
to place on record their deep sense of appreciation for devoted services of the
Executives, Staff and workers of the Company for its success.
| SUMEET INDUSTRIES LIMITED (Under CIRP) |
| Shankarlal Somani |
| Director |
| (Member of Suspended Board of Directors) |
| DIN:00165238 |
| Noted By |
| Mr. Satyendra P. Khorania |
| Resolution Professional |
| (Reg. No. IBBI/IPA-002/IP-N00002/2016-17/10002) |
| Place: Surat |
| Date: 10/08/2023 |
|