DIRECTOR'S REPORT TO THE MEMBERS GYSCOAL ALLOYS LIMITED DEAR SHAREHOLDERS, Your Directors have pleasure in presenting the Sixteenth Annual Report and the Audited Statement of Accounts for the financial year ended 31st March, 2015. 2. DIVIDEND & RESERVES: Due to inadequate profit your directors are not in a position to recommend any dividend for the financial year ended 31st March, 2015. NIL amount has been transferred to General Reserve. 4. UNPAID AND UNCLAIMED SHARE APPLICATION AMOUNT : Pursuant to the provision of Section 125(2) of the Companies Act, 2013, dividends, matured fixed deposits, redeemed debentures, Share Application money due for refund and interest thereon, which remained unclaimed up to 23rd October, 2017 will be deposited to Investors' Education and Protection Fund (IEPF) of the Central Government. Amount of Rs.25560/- is lying as the Amount of Application money received and due for refund in respect of the IPO of the company in F.Y. 2010-2011. The last date on which the amount will be transferred to IEPF account will be 23rd October, 2017 Therefore, the shareholders are advised to claim such amounts immediately. 5. BUSINESS PERFORMANCE & PROSPECTS: Information on operational and financial performance, etc. of the Company for the financial year is given in the Management Discussion and Analysis which is setout as Annexure E to the directors' Report. 6. PUBLIC DEPOSITS: The Company has not accepted any fixed deposit from public within the meaning of Section 73 of the Companies Act, 2013 and rules made thereunder. 7. SUBSIDIARY COMPANIES & CONSOLIDATED FINANCIAL STATEMENT: In accordance with Companies Act, 2013 ("the Act") and Accounting Standard (AS)-21 on consolidated financial statement read with As-23 on Account for investment in associates and AS-27 on financial reporting of interest in Joint ventures. The audited consolidated financial is provided in the Annual Report. The Company has prepared Consolidated Financial Statements of the Company and while preparing the consolidated financial statements, Company has consolidated the accounts of one subsidiary namely Thai Indo Steel Co. Ltd. as per the requirements of Accounting Standards issued by the Institute of Chartered Accountants of India. 8. BRIEF DESCRIPTION OF THE COMPANY'S WORKING DURING THE YEAR/STATE OF COMPANY'S AFFAIR The company is operating in only one segment i.e. Metal Industry. The company mainly manufactures SS Angles, SS Flats & SS Rounds and the % wise breakup of the products of the total turnover of the company is as under:- S.S. ANGLE BARS 18 % S.S. FLAT BARS 15 % S.S. ROUND BARS 28% 9. DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS Your Company has a comprehensive system of internal controls to safeguard the Company's assets against loss from unauthorized use and ensure proper authorization of financial transactions. The Company has an exhaustive budgetary control system to monitor all expenditures against approved budgets on an ongoing basis. The Company maintains a system of internal controls designed to provide assurance regarding the effectiveness and efficiency of operations, the reliability of financial controls and compliance with applicable laws and regulations as applicable in the various jurisdictions in which the Company operates. 10. CORPORATE GOVERNANCE CERTIFICATE In terms of clause 49 of listing agreement with the Stock Exchange, a certificate from Secretarial Auditor of the Company on compliance of conditions of Corporate Governance is annexed to the Annual Report. A report on Corporate Governance as provided in clause 49 of the Listing Agreement is included in the Annual Report. 11. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO The information pertaining to conservation of energy, technology absorption, Foreign exchange Earnings and outgo as required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is furnished in "Annexure - A" and is attached to this report. 12. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY Pursuant to section 134 (3) (n) of the Companies Act, 2013 & Clause 49 of the listing agreement, the company has framed Risk Management Policy. The details of the policy are as updated on website of the company www.gyscoal.com. The risk management includes identifying types of risks and its assessment, risk handling and monitoring and reporting. At present the company has not identified any element of risk which may threaten the existence of the company. 13. DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIAL RESPONSIBILITY INITIATIVES The Company has not developed and implemented any Corporate Social Responsibility initiatives as the said provisions are not applicable. 14. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013 The details of Loans, Guarantee and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements. 15. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES All contracts/arrangements/transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on arm's length basis. During the year, the Company had not entered into any contract/arrangement/transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions. The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company's website at the link: <http://www.gyscoal.com/wp-content/uploads/> 2014/03/related_party_transaction_policy.pdf Your Directors draw attention of the members to Note 32 to the financial statement which sets out related party disclosures. 16. AUDITORS & AUDITORS REPORT M/s. B K Patel & Co., Chartered Accountants (ICAI Registration No. 112647W), Ahmedabad were appointed as Statutory Auditors for a period of 1 (one) year in the Annual General Meeting held in last year. Their continuance of appointment and payment of remuneration are to be confirmed and approved in the ensuing Annual General Meeting. The Company has received a certificate from the above Auditors to the effect that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013. The notes to the accounts referred to in the Auditors Report are self- explanatory and does not contain any qualification, reservation or adverse mark and therefore do not call for any further comments. The explanation on adverse remarks / qualification(s) in the Auditor's Report - Point No. (vii) (a) to the Standalone Financial Statements: According to the information and explanations given to us, the Company has been generally regular in depositing undisputed statutory dues including provident fund, employees' state insurance, income-tax, sales-tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory applicable to it with the appropriate authorities during the period. However, in some cases such statutory dues are paid after its due dates along with interest during the year. Point No. (vii) (b) to the Standalone Financial Statements: According to the information and explanations given to us, the disputed statutory dues aggregating Rs. 416000397/- that have not been deposited on account of disputed matter pending before appropriate authorities Explanation to Point No. (vii) (a) and Point No. (vii) (b) to the Standalone Financial Statements: The Management is in the process of taking necessary steps to resolve pending statutory dues as mentioned in the Auditor's Report Point No. (vii) (b) and taking measures to pay them within due course as mentioned in Point No. (vii) (a). 17. SECRETARIAL AUDIT REPORT: The Board has appointed M/s A G Shah & Associates, Practicing Company Secretaries (ICSI Membership No. 29017 & CPN 10642), to conduct Secretarial Audit for the financial year 2014-15. The Secretarial Audit Report for the financial year ended March 31, 2015 is annexed herewith marked as "Annexure D" to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse mark. The explanation on comments / observation(s) in the Secretarial Audit Report - Point 1. Company did not Filed MGT 14 for appointment of Secretarial Auditor, M/s. AG Shah & Associates who were appointed under the Board Meeting held on 03.02.2015 Explanation 1: The Company has appointed M/S. A G Shah & Associates as Secretarial Auditor of the Company to conduct audit for the year 2014 - 2015 in Board Meeting held on 3rd February, 2015. The Company is in process to file e Form MGT - 14 for the appointment of Secretarial Auditor in line with the requirement of Act. 18. COST AUDITOR: Pursuant to Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014, your Directors had, on recommendation of the Audit Committee, appointed Shri V.H. Shah, Practicing Cost Accountant (ICWAI Registration No. 100257), Ahmedabad as Cost Auditor for conducting audit of cost accounting records maintained by the Company for "Steel Plant" for the financial year 2015-16. As required under the Companies Act, 2013, the remuneration payable to the cost auditor is required to be placed before the Members in a general meeting for their ratification. Accordingly, the resolution seeking Members' ratification is included in the Notice convening the Annual General Meeting. 19. COMPANY'S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF REMUNERATION AND DISCHARGE OF THEIR DUTIES The Company has adopted a Remuneration Policy for the Directors, Key Managerial Personnel and other employees, pursuant to Section 178(3) of the Companies Act, 2013 and Clause 49 of the Listing Agreement. The philosophy for remuneration of Directors, Key Managerial Personnel and all other employees of the Company is based on the commitment of fostering a culture of leadership with trust. The Remuneration Policy of the Company is aligned to this philosophy. It is affirmed that the remuneration paid to Directors, Key Managerial Personnel and all other employees is as per the Remuneration Policy of the Company. Details of the Remuneration Policy are given in the Corporate Governance Report. Your company has adopted a defined policy and procedure for Appointment of Independent Directors which has been put on Company website www.gyscoal.com 20. ANNUAL RETURN The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and administration) Rules, 2014 is furnished in "ANNEXURE B" and is attached to this Report. 21. NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW The Company had 7 (Seven) Board meetings during the financial year under review. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. 22. DIRECTORS RESPONSIBILITY STATEMENT In accordance with the provisions of Section 134(5) of the Companies Act, 2013 the Board hereby submits its responsibility Statement 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; 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. 23. PARTICULARS OF EMPLOYEES The information required pursuant to Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees' particulars which is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company upto the date of the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard. 24. DIRECTORS AND KEY MANAGERIAL PERSONNEL: As per Section 152 of the Companies Act, 2013 Mr. Viral M Shah, Managing Director retire at this Annual General Meeting and being eligible offer himself for re election. The Board of Directors recommended his re- appointment at the forthcoming Annual General Meeting. Mr. Dileep Panchal has joined as Company Secretary & Compliance Officer w.e.f.30th July,2014 in place of Ms. Neha Choksi who has resigned on the same date and resigned from the post w.e.f. 16/03/2015. Mr. Manish M Shah (DIN - 00014195) who was appointed as Whole Time Director as well as CFO - Chief Financial Officer of the Company ceased as a Director as well as CFO - Chief Financial Officer w.e.f. 21/08/2014 due to death. The Board expresses their deep condolence at the untimely and sad demise of Mr. Manish M Shah. Mrs. Giraben Solanki(DIN - 00014248) who was appointed as Additional Director on 26/03/2014 resigned as a director w.e.f. 15/05/2015 due to her pre occupation. The Board expresses its appreciation for the services rendered by her during her tenure with the Company. Mrs. Bharti Dhanak (DIN - 03268121) who was appointed as Additional Director on 15/10/2014 and holds the said office till the date of the Annual General Meeting. A notice has been received from a member proposing her candidature for her reappointment. Pursuant to the provisions of Section 203, Mr. Kalpesh Patel has been appointed as Chief Financial Officer of the company w.e.f. 03/02/2015. Mrs. Nidhi Bhatt served the company as Company Secretary & Compliance Officer as well as KMP from 1st April, 2015 to 31st July, 2015. Ms. Shrima Dave appointed as Company Secretary & Compliance Officer as well as KMP of the Company w.e.f. 1st August, 2015. 25. DECLARATION OF INDEPENDENT DIRECTORS The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules. 26. FORMAL ANNUAL BOARD EVALUATION Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an evaluation of its own performance and the Directors individually. A process of evaluation was followed by the Board for its own performance and that of its Committees and individual Directors. A familiarization programme was conducted for Independent Directors to familiarize them with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters and the said was updated on website of the Company http:/ /www.gyscoal.com/wp-content/uploads/2014/13/Familiarisation_Programme_for_the_year_14_15.pdf 27. DISCLOSURE OF COMPOSITION OF AUDIT COMMITTEE AND PROVIDING VIGIL MECHANISM The Audit Committee consists of the following members: a) Shri. Sunial Talati - Chairman b) Shri. Surendra Patel - Member c) Shri Viral Shah - Member The Company has established a vigil mechanism and overseas through the committee, the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the chairman of the Audit Committee on reporting issues concerning the interests of co employees and the Company. 28. GENERAL No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future. 29. ACKNOWLEDGEMENTS Your Directors place on record their sincere thanks to bankers, business associates, consultants, and various Government Authorities for their continued support extended to your Companies activities during the year under review. Your Directors also acknowledges gratefully the shareholders for their support and confidence reposed on your Company. For and on behalf of Board Of Directors Viral Shah (Chairman & Managing Director) DIN - 00014182 Date : 13/08/2015 Place : Ahmedabad |