reliance jute 2017 (1) · reliance jute mills (international) limited (2) reliance jute mills...

21st

ANNUAL REPORT

APRIL 2016 – MARCH 2017

RELIANCE JUTE MILLS (INTERNATIONAL) LIMITED


(1)


BOARD OF DIRECTORS : Shri P. K. Kanoria – Executive Chairman

Shri S. Hada – Managing Director & CEO

Shri P. K. Jain – Independent Director

Dr. P. K. Mookerjee – Independent Director

Shri P. Bhartia – Independent Director

Shri V. K. Chaukhani – Whole-time Director

Smt. Smita Poddar – Non-Executive Director

PRESIDENT (FINANCE)

& COMPANY SECRETARY : Shri S. K. Agarwal

& CFO

REGISTERED OFFICE : Ideal Plaza, South Block, 4th Floor

11/1, Sarat Bose Road, Kolkata-700 020

Phone : (033) 2280 7017/18, Fax: (033) 2280 7016

E-mail: [email protected]

Website: www.reliancejute.com

CIN : L17125WB1996PLC081382

WORKS : Reliance Jute Mills

Bhatpara-743 123

24 Parganas (North), West Bengal

AUDITORS : Singhi & Co.

Chartered Accountants

161, Sarat Bose Road, Kolkata-700 026

REGISTRAR : S. K. Infosolutions Pvt. Ltd.

34/1A, Sudhir Chatterjee Street, Kolkata-700 006

Phone No.: (033) 2219 6797, Fax : (033) 2219 4815

E-mail:[email protected]

BANKER : Punjab National Bank

135, B.R.B.B. Road, Kolkata-700 001

LISTING OF SHARE : The Calcutta Stock Exchange Limited

7, Lyons Range, Kolkata-700 001

CONTENTS

Page No. Page No.

Notice ……………………………………. 2-10 Profit & Loss Account………………... 63

Directors’ Report………………………… 11-52 Cash Flow……………………………... 64

Auditors’ Report…………………………. 53-61 Notes…………………………………... 65-87

Balance Sheet……………………………. 62 Road Map……………………………… 88


(2)


CIN : L17125WB1996PLC081382

Regd. Office: Ideal Plaza, South Block, 4th Floor

11/1, Sarat Bose Road, Kolkata-700 020

Telephone No. (033) 2280 7017/18

Fax No.: (033) 2280 7016

E~mail: [email protected]


NOTICE TO THE MEMBERS

Notice is hereby given that the 21st Annual General Meeting of the Members of Reliance Jute Mills

(International) Limited will be held on Thursday, the 14th day of September, 2017 at 4.00 P.M at

Keshari Devi Kanoria Hall, 123, Dr. Meghnad Saha Sarani, (Southern Avenue), Kolkata-700 029 to

transact the following business :

ORDINARY BUSINESS :

1 To receive, consider and adopt the Audited Financial Statements of the Company for the year

ended 31st March, 2017 including the Audited Balance Sheet as at 31st March, 2017, Statement

of Profit & Loss for the year ended on that date, and the Reports of the Auditors and the Board of

Directors thereon.

2. To appoint a Director in place of Shri Vijendra Kumar Chaukhani (DIN: 00309895), who retires

by rotation and being eligible, offers himself for re-appointment.

3. To appoint the Auditors in place of the existing Auditors (who are not eligible to be re-appointed

due to expiry of the maximum permissible tenure as the Auditors of the Company), to fix their

remuneration, and to pass the following Resolution, as an Ordinary Resolution.

“RESOLVED THAT pursuant to the recommendations of the Audit Committee of the Board of

Directors of the Company and in terms of the provisions of Sections 139, 141, 142 and other

applicable provisions, if any, of the Companies Act, 2013 and the Companies (Audit and Auditors)

Rules, 2014 including amendment(s), statutory modification(s) or re-enactment(s) thereof for the

time being in force, M/s. Jitendra K Agarwal & Associates, Chartered Accountants (ICAI Firm

Registration No. 318086E), be and are hereby appointed the Auditors of the Company, in place

of the retiring Auditors, M/s. Singhi & Co., Chartered Accountants (ICAI Firm Registration No.

302049E), to hold office from the conclusion of this Annual General Meeting until the conclusion

of the Twenty Sixth Annual General Meeting of the Company to be held in the year 2022, subject

to ratification of their appointment by the Members of the Company, if required, at every Annual

General Meeting.”

“FURTHER RESOLVED THAT the Audit Committee of the Board of Directors of the Company

be and is hereby authorized to determine the remuneration and reimbursement of out of pocket

expenses, as may be payable to the Auditors.”


(3)

SPECIAL BUSINESS :

4. To consider and if thought fit, to pass with or without modification(s), the following Resolution

as an Ordinary Resolution :

“RESOLVED THAT pursuant to the provisions of Section 148 and all other applicable provisions

of the Companies Act, 2013 and Companies (Audit and Auditors) Rules, 2014 (including any

statutory modification(s) or re-enactment thereof, for the time being in force) and any amendment

of such provisions from time to time, subject to the receipt of the order of the Central Government,

M/s. N. Radhakrishnan & Co. (Registration No. 000056), Cost Accountants, appointed by the

Board of Directors of the Company to conduct the Audit of Cost Records of the Company for the

financial year ending 31st March, 2018, be paid a remuneration of Rs.30,000/-(Rupees Thirty

Thousand) only plus applicable taxes and reimbursement of out-of-pocket expenses.”

By Order of the Board

For Reliance Jute Mills (International) Ltd.

S. K. Agarwal

President (Finance) &

Kolkata, the 30th day of May, 2017 Company Secretary

NOTES :

1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE ANNUAL GENERAL MEETING

IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF/

HERSELF AND A PROXY NEED NOT BE A MEMBER OF THE COMPANY. THE

INSTRUMENT APPOINTING PROXY MUST BE DEPOSITED AT THE REGISTERED

OFFICE OF THE COMPANY NOT LESS THAN FORTY EIGHT HOURS BEFORE THE TIME

FIXED FOR THE MEETING.

Pursuant to provisions of Section 105 of the Companies Act, 2013, read with the applicable rules

thereon, a person can act as a proxy on behalf of members not exceeding fifty and holding in the

aggregate not more than ten percent of the total share capital of the Company carrying voting

rights. A member holding more than ten percent of the total share capital of the Company carrying

voting rights may appoint a single person as proxy and such person shall not act as proxy for any

other person of shareholder.

2. Information as required under Regulation 36(3) of the SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015 (‘Listing Regulations’) and the Secretarial Standard on General

Meetings (SS-2) issued by the Institute of Company Secretaries of India (ICSI), in respect of the

Director seeking re-appointment at the AGM is provided hereunder.


(4)

3. As required under SS-2 issued by the ICSI, a route map, including a prominent landmark, showing

directions to reach the AGM venue is annexed to the Annual Report.

4. Pursuant to Section 113 of the Companies Act, 2013 and Rules framed thereunder, the corporate

members intending to send their authorized representatives to attend the meeting are requested to

send to the Company a certified copy of the Board Resolution authorizing their representative to

attend and vote, on their behalf, at the meeting.

5. The relative Explanatory Statement pursuant to Section 102 of the Companies Act, 2013 in respect

to the Special Business to be transacted at the Meeting is annexed hereto.

6. Pursuant to Section 91 of the Companies Act, 2013 and Rule 10 of the Companies (Management

and Administration) Rules, 2014 read with Regulation 42(5) of the Listing Regulations, the Share

Transfer Books and Register of Members of the Company will remain closed from 9th September,

2017 to 14th September, 2017 (both days inclusive).

7. As per Regulation 40(7) of the Listing Regulations read with Schedule VII to the said Regulations,

for registration of transfer of shares, the transferee(s) as well as transferor(s) shall mandatorily

furnish copy of their Income Tax Permanent Account Number (PAN). Additionally, for securities

market transactions and/or for off market / private transactions involving transfer of shares in

physical mode of listed Companies, it shall be mandatory for the transferee(s) as well as

transferor(s) to furnish copy of PAN Card to the Company / RTA for registration of such transfer

of shares. In case of transmission of shares held in physical mode, it is mandatory to furnish a

copy of the PAN Card of the legal heir(s) / Nominees (s).

8. The Ministry of Corporate Affairs (MCA), Government of India has introduced a ‘Green initiative

in Corporate Governance’ by allowing paperless compliances by the Companies for service of

documents to their Members through electronic mode, which will be in compliance with Section

20 of the Companies Act, 2013and Rules framed thereunder.

In case you have not registered your e-mail Id, please communicate the same to the Company or

RTA at their communication address given in the Annual Report in respect of the shares held in

physical mode or communicate to your DPs concerned in respect of shares held in demat / electronic

mode. Although you are entitled to receive physical copy of the Notices, Annual Reports, etc.

from the Company, we sincerely seek your support to enable us to forward these documents to

you only by e-mail, which help us participate in the Green Initiatives of the MCA and to protect

our environment.

9. This notice is being sent to all the members whose name appears as on 18th August, 2017 in the

register of members or beneficial owners as received from M/s. S. K. Infosolutions Pvt. Ltd., the

Registrar and Transfer Agent of the Company.

A person whose name is recorded in the register of members or in the register of beneficial

owners maintained by the depositories as on 8th September, 2017 (“the Cut off Date”) only

shall be entitled to vote through Remote E-voting and at the AGM. The voting rights of Members

shall be in proportion to their share of the paid-up equity share capital of the Company as on the

Cut off Date.


(5)

10. Members are requested to notify promptly any change in their address to the Company’s Registrars

and Share Transfer Agent, M/s. S. K. Infosolutions Pvt. Ltd. The members are also requested to

send all correspondence relating to Shares, including transfers and transmissions to the above

Registrars and Share Transfer Agent.

11. The facility for making nominations is available for members in respect of the shares held by

them. Nomination Form can be obtained from the Company’s Registered Office.

12. Electronic copy of the Annual Report for the year 2016-17, Notice of the Annual General Meeting

along with Attendance Slip and Proxy Form are being sent to all the members whose E-mail IDs

are registered with the Company/Depository Participants(s) for communication purposes unless

any member has requested for a hard copy of the same. For members who have not registered

their E-mail address, physical copies of the Annual Report for the year 2016-17 is being sent in

the permitted mode.

13. Members desirous of obtaining information in respect of accounts and operations of the Company

are requested to send queries in writing to the Company at the registered office, so as to reach at

least seven days before the date of the meeting so that proper information can be made available

at the meeting.

14. The shares of the Company have been listed at The Calcutta Stock Exchange Limited and Company

has already paid Listing Fees to the said Stock Exchanges for the year 2017-18.

15. Register of Directors and Key Managerial Personnel and their shareholding maintained under

Section 170 of Companies Act, 2013 and Register of Contracts or arrangements in which Directors

are interested maintained under Section 189 of the Companies Act, 2013 will be available for

inspection by the members at the Annual General Meeting.

16. All the documents referred to in the Notice and Explanatory Statement will be available for

inspection by the Members at the Registered Office of the Company between 11.00 a.m. and 1.00

p.m. on all working days from the date hereof upto the date of the Meeting.

17. The voting for the agenda items as mentioned in the Notice shall be done in the following manner:

(i) Members may cast their votes through electronic means by using an electronic voting

system from a place other than the venue of AGM (“Remote E-voting”) in the manner

provided below during the e-voting period mentioned below in Para (18)(C).

(ii) At the venue of AGM, voting shall be done through ballot papers (“Ballot Paper”) and the

members attending AGM who have not casted their vote by Remote E-voting shall be

entitled to cast their vote through Ballot Paper.

(iii) A Member may participate in the AGM even after exercising his right to vote through

Remote E-voting but shall not be allowed to vote again at the venue of the AGM. If a

Member casts votes through Remote E-voting and also at the AGM, then voting done


(6)

through Remote E-voting shall prevail and voting done at the AGM shall be treated as

invalid.

18. Pursuant to Section 108 of the Companies Act, 2013, read with Rule 20 of the Companies

(Management and Administration) Rules, 2014 as amended by the Companies (Management and

Administration) Amendment Rules, 2015 and Regulation 44 of the SEBI (Listing Obligations

and Disclosure Requirements) Regulations, 2015, the Company is pleased to provide facility of

Remote E-voting to all its Members, to enable them to cast their votes on all Resolutions set forth

in this Notice electronically and the business mentioned in the Notice may be transacted through

e-voting. Remote E-voting is optional and not mandatory. The Company has engaged the services

of National Securities Depository Limited (NSDL) for the purpose of providing Remote E-voting

facility to all its Members. The process and manner of Remote E-voting are as under :

A. Instruction for E-voting by Members whose E-mail IDs are registered with the Company/

Depository Participant(s) :

(a) Members whose E-mail addresses are registered with the Company/Depository

Participant(s) will receive an E-mail from NSDL informing the “USER-ID” and

“PASSWORD”.

(b) Open e-mail and open PDF file viz. ‘RJM e-voting.pdf’ with your Client ID No. or

Folio No. as password. The said PDF file contains your user ID and password/PIN

for remote e-voting. Please note that the password is an initial password.

(c) Launch internet browser by typing the URL: https://www.evoting.nsdl.com.

(d) Click on Shareholder – Login.

(e) Enter user ID and password as initial password/PIN noted in step (a) above. Click

Login.

(f) Password change menu appears. Change the password with a new password of your

choice with minimum 8 digits / characters or combination thereof. Note new

password. It is strongly recommended not to share your password with any other

person and take utmost care to keep your password confidential.

(g) Home page of remote e-voting opens. Click on e-voting Active Voting Cycles.

(h) Select “EVEN” (E Voting Event Number) of Reliance Jute Mills (International)

Limited.

(i) Now you are ready for e-voting as Cast Vote page opens.

(j) Cast your vote by selecting appropriate option and click on “Submit” and also

“Confirm” when prompted.


(7)

(k) Upon confirmation, the message “Vote cast successfully” will be displayed.

(l) Once you have voted on the Resolution, you will not be allowed to modify your

vote.

(m) Institutional Members (i.e. other than individuals, HUF, NRI etc.) are required to

send scanned copy (in PDF / JPG Format) of the relevant Board Resolution /

Authority letter etc. together with attested specimen signature of the duly authorised

signatory(ies) who are authorised to vote, to the Scrutinizer through E-mail to

[email protected] with a copy marked to [email protected].

B. Instruction for E-voting by Members whose E-mail IDs are not registered with Company/

Depository Participant(s) or requesting physical copy :

(a) For Members whose E-mail IDs are not registered with the Company/Depository

Participant(s), will be receiving notice of AGM by post.

(b) Initial password is provided on the attendance slip for the AGM.

(c) Please follow all steps from Sl. No. (c) to (m) of (A) above, to cast vote.

Notes :

(i) Login to the e-voting website will be disabled upon five unsuccessful attempts to

key in the correct password. In such an event, you will need to go through the

“Forgot Password” option available on the site to reset the password.

(ii) If you are already registered with NSDL for e-voting then you can use your existing

User ID and password for casting your vote.

(iii) You can also update your mobile number and E~mail ID in the user profile details

of the folio, which may be used for sending future communication(s).

(iv) Once the vote on a Resolution is cast by a Member, he/she shall not be allowed to

change it subsequently or cast the vote again.

C. E-voting Period

The Remote E-voting period commences on Monday, 11th September, 2017 (9.00 a.m.)

and ends on Wednesday, 13th September, 2017 (5.00 p.m.). During the aforesaid period,

Members of the Company may opt to cast their votes through Remote E-voting. After 13th

September, 2017 (5.00 p.m.) the Remote Evoting facility will be blocked.

D. User ID and Password for the members who became Members after dispatch of AGM

notice :


(8)

Persons who have acquired shares and became members of the Company after dispatch of

the notice of AGM but before the cut off date of 8th September, 2017, may obtain their

user ID and password for e-voting from the Company’s Registrar and Share Transfer Agent

or NSDL.

E. Queries in relation to E-voting:

In case of any queries, you may refer to the “Frequently Asked Questions (FAQs) for

members and e-voting user manual for members” available at the ‘downloads’ section of

www.evoting.nsdl.com. For any further grievance related to the Remote E-voting members

may contact NSDL at the following contact information:

Phone No.: +91 22 24994600/24994738, Toll free no. 1800222990

E-mail ID: [email protected]

19. Members who have not exercised the option of Remote E-voting shall be entitled to participate

and vote at the venue of the AGM on the date of the AGM. Voting at the venue of AGM shall be

done through Ballot Papers and Members attending the AGM shall be able to exercise their

voting rights at the meeting through Ballot Papers. After the agenda item has been discussed, the

Chairman will instruct the Scrutinizer to initiate the process of voting on all the Resolutions

through Ballot Papers. The Ballot Paper/s will be issued to the Shareholders/Proxy holders/

Authorised Representatives present at the AGM. The shareholders may exercise their right of

vote by tick marking (ü) against “FOR” or “AGAINST” as his/her choice may be, on the agenda

item in the Ballot Paper and drop the same in the Ballot Box(es) kept at the meeting hall for this

purpose.

20. Shri Navin Kothari, Company Secretary in practice (Membership No. 5935) of M/s. N. K. &

Associates, Company Secretaries having consented to act as Scrutinizer has been appointed as

Scrutinizer (“Scrutinizer”) for scrutinizing the voting process (Ballot Paper as well as Remote

E-voting) in a fair and transparent manner.

The Scrutinizer shall immediately after the conclusion of voting at the AGM, first count the votes

cast at the AGM by Ballot Papers and thereafter unblock the votes casted through e-voting in the

presence of at least two witnesses not in the employment of the Company. The Scrutinizer shall,

within a period not exceeding three days from the conclusion of the AGM, prepare and present a

consolidated report of the total votes cast in favour or against, if any, to the Chairman of the

Company or a person authorised by him in writing who shall countersign the same.

21. The result of voting (Remote E-voting and the voting at the AGM) on the Resolutions shall be

declared within 3 days from the date of AGM by the Chairman or any person authorised by him

for this purpose. The results declared along with the report of the Scrutinizer shall be placed on

the website of the company i.e. www.reliancejute.com in the investor’s relation section and on

the website of NSDL i.e. www.evoting.nsdl.com immediately after the result is declared and

simultaneously communicated to The Calcutta Stock Exchange Ltd.


(9)

22. Members holding shares in physical form and desirous of making a nomination in respect of their

shareholding in the Company, as permitted under Section 72 of the Companies Act, 2013 or any

statutory re-enactment thereof, are requested to submit the request in prescribed form SH-3 to

the RTA.

INFORMATION RELATING TO THE RE-APPOINTMENT

OF DIRECTORS AT THE AGM

Item No. 2: Re-appointment of Shri Vijendra Kumar Chaukhani (DIN: 00309895) as a Director of

the Company, liable to retire by rotation.

In accordance with the provisions of Section 152 of the Companies Act, 2013, Rules framed thereunder

and the Articles of Association of your Company, Shri Vijendra Kumar Chaukhani, Director is due to

retire by rotation at the ensuing AGM and being eligible, offers himself for re-appointment. The Company

has received necessary disclosures and declarations from Shri Vijendra Kumar Chaukhani under the

Companies Act, 2013 and the Listing Regulations, confirming his eligibility to be re-appointed as a

Director of the Company, liable to retire by rotation.

Shri Vijendra Kumar Chaukhani (Shri. Chaukhani), aged 67 years, is currently the Whole-time Director

of the Company. Shri Chaukhani is Bachelor of Commerce (B. Com.) with more than 45 years of post-

qualification experience in Marketing and has been associated with the Company for the last several

years in various capacities.

There is no inter-se relationship between Shri Chaukhani and other Directors and Key Managerial

Personnel of the Company. Shri Chaukhani holds 20 Nos. of equity shares in the Company.

None of the Directors or Key Managerial Personnel of the Company or their relatives, except Shri

Chaukhani himself, to the extent of his directorship, is concerned or interested financially or otherwise,

in the aforesaid proposed Resolution.

EXPLANATORY STATEMENT PURSUANT TO SECTION 102

OF THE COMPANIES ACT, 2013 :

Item No. 4

The Board of Directors, on recommendation of the Audit Committee, has approved the appointment of

M/s. N. Radhakrishnan & Co., Cost Accountants, as Cost Auditors to conduct the audit of the cost

accounts and cost records maintained by the Company in respect of its products for the financial year

ended 31st March, 2017.

In accordance with the provisions of Section 148 of the Companies Act, 2013 read with the Companies

(Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditors has to be ratified by

the Members of the Company. Accordingly, consent of the Members is sought for passing an Ordinary

Resolution as set out at Item No. 4 of the Notice for ratification of the remuneration payable to the Cost

Auditors for the financial year ended 31st March, 2018.


(10)

The Board recommends the approval of the remuneration payable to M/s N. Radhakrishnan & Co., Cost

Accountants for conducting the cost audit and passing of the Resolution set out at Item No. 4 of the

Notice.

None of the Directors or Key Managerial Personnel or their relatives are in any way concerned or

interested in the passing of the Resolutions.

Note : In respect of Item No. 3 of the Notice, following information is provided by way of note as

the item being an Ordinary Business, a statement is not required to be given under Section 102 of

the Companies Act, 2013 :

M/s. Singhi & Co., Chartered Accountants (ICAI Registration No. 302049E), Statutory Auditors of the

Company was appointed as Statutory Auditors of the Company to hold office from the conclusion of the

Annual General Meeting held on 27th September, 2014 until the conclusion of the third consecutive

Annual General meeting on a remuneration to be mutually agreed upon with the Board of Directors

subject to ratification by the members at every Annual General Meeting. The term of its appointment

will expire at the ensuing Annual General Meeting and another auditor is required to be appointed in its

place. The Board of Directors has passed resolution for appointment of M/s. Jitendra K Agarwal &

Associates (Firm Registration No. 318086E), Chartered Accountants as the statutory auditors of the

Company to hold office from the conclusion of this Annual General Meeting until the conclusion of the

26th Annual General Meeting of the Company, to be held in the year 2022 subject to ratification by the

shareholders at every Annual General Meeting.

In view of the above, the Board seeks approval of the members for appointment of M/s. Jitendra K

Agarwal & Associates (Firm Registration No. 318086E), Chartered Accountants as Statutory Auditors

of the Company as above.

By Order of the Board

For Reliance Jute Mills (International) Ltd.

S. K. Agarwal

President (Finance) &

Kolkata, the 30th day of May, 2017 Company Secretary


(11)

Directors’ Report

Dear Members,

Your Directors have pleasure in presenting the 21st Annual Report of the Company together with Audited

Statement of Accounts for the year ended 31st March, 2017.

FINANCIAL RESULTS Year ended

31.03.2017

(Rs.)

During the year before providing for depreciation

and finance costs, there was a surplus of 89,05,937

Out of which, provision has been made for

Finance costs 3,75,28,758

Depreciation 1,47,11,149

Thus there is a deficit of (4,33,33,970)

OPERATIONS AND STATE OF COMPANY’S AFFAIRS

During the financial year 2016-17 production was 28,310 MT as compared to 30,274 MT in the previous

year. Production decreased due to suspension of work from 21st November, 2016 to 9th December,

2016, followed by continuous disturbance of production due to labour trouble during the year under

review. Consequently, profitability of the Company was adversely affected. However, the sales turnover

of the Company increased marginally to Rs.229.33 Crores during the financial year 2016-17 as compared

to Rs. 227.22 Crores during the previous year. During the year under review, the productivity was much

better and there was also reduction in interest cost but due to labour trouble resulting in lower production

in the month of November and December’ 2016 there was a decline in production compared to last year.

It is expected that due to normal monsoon forecast by Met Office in current year too cultivation of jute

crop and consequently, availability of raw jute at reasonable prices coupled with adequate demand of

sacking for packaging of food good is encouraging. Your Company is making all out efforts to focus on

increasing production and improving productivity as well as to diversify its products.

As an effort towards modernization and also to mitigate the shortage of workmen, the Company imported

and installed S4 type Rapier Looms to replace the conventional Shuttle less Looms. Orders for further

fully Automatic Shuttle less Weaving S4A Looms have been placed. The Company has installed ‘Adelphi’

Brand Chinese Flexible Automatic Rapier Looms for production of diversified and value added jute

products. Besides, a programme has been undertaken to renovate Spinning Frame to increase productivity.

Those Spinning Frame which are not in good condition are being replaced by higher capacity modern

43/4” Spinning Machine of 120 Sprindles Bauxter Flyer, Slep Draft System for higher production and

saving in wages cost.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

a) Industry structure and developments :

Jute Industry dates back about one and half century in India and its importance lies in its long


(12)

life. India is a country of farmers and a large number of farmers and workers depend on this

industry for their livelihood. The Government understands the importance of this industry

and that is why it has been taking interminable steps to protect this industry including extension

of the mandatory packaging norms, promotion of jute diversified products like promotion of

jute geo textiles, etc.

Further, it may be worthwhile to note that Indian Roads Congress (IRC) – the apex body of

highway engineers in the country, has recognized certain patterns of jute as geo-textile which

makes it apt for use in road construction. The recognition by IRC is expected to have a positive

impact on the future of the jute industry in India.

The introduction of Jute ICARE Programme by National Jute Board would help in cultivation

of good quality raw jute in good quantity which would ensure regular smooth running of the

Jute Industry.

b) Opportunity and Threats / Risks and Concerns

It is expected that there will be good jute crop during the current year and should augur well

for the Industry going forward, barring unforeseen circumstances. Opportunity also lies in

diversification of products range by installing new generation equipments and innovation of

value added diversified products. Awareness to use eco-friendly, bio-degradable jute goods

across the world will keep jute goods always in demand. Steps taken by the Govt. of India to

assist the jute mills to upgrade old/obsolete machineries and to promote jute diversified

products will provide opportunity to increase market of jute goods.

The following areas of risks and concerns continue to pose threat to Jute Industry.

ü The jute industry is under threat for partial dilution of the mandatory jute packaging order

for 2017-18 for food grain packaging to 80 per cent against 90 per cent now. Union Food

Ministry has recommended 75 per cent for foodgrain and freeing sugar from jute packaging

order. In simple terms, the Jute Packaging Materials (Compulsory Use in Packaging

Commodities) Act 1987 mandates governments to use jute sackings for mandatory food

grain and sugar packaging. It is a matter of concern for the jute industry.

ü Cut throat competition from Bangladesh which continues to enjoy benefits in the form

of lower costs and government subsidies.

ü Import of finished goods from Bangladesh.

ü Increase in wage cost which constitutes high proportion of production costs in a labour

intensive industry.

ü Heavy shortage of workers resulting in lower capacity utilization in the Mills.

c) Segment-wise or Product-wise Performance

Jute goods remain the Company’s only area of business in the year under review, hence requires

no disclosure under AS 17 in respect of business segment.


(13)

d) Outlook

The outlook seem to be satisfactory since there is not any likely to shortage of raw jute and

demand for packaging of food grain will continue to be good.

e) Internal control system and their adequacy

The Company has an adequate system of internal control which not only ensures proper and

timely recording and reporting of transactions but also provide avenue for exercising effective

safe guards over Company’s assets. For this purpose, the Company has appointed independent

Internal Auditors. Observations of internal auditor are circulated to senior management for

their perusal and necessary action. Corrective actions are taken as per requirements. In

consultation with Internal Auditor, the Audit Committee formulates the scope, functioning,

periodicity and methodology for conducting the internal audit.

f) Discussion on Financial Performance with respect to Operational Performance

During the year under review, the performance of the Company did not improve much. Due to

increase in raw jute prices on account of its poor availability in the first part of the financial

year and suspension of work in the months of November, 2016 and December, 2016, the

Company could not increase production much in spite of better productivity.

g) Material Development in Human Resources/Industrial Relations front, including number

of people employed

Industrial relations remained more or less cordial during the year under review although there

was suspension of work in the months of November, 2016 and December, 2016 due to

indiscipline in some section of workers. As on 31st March, 2017, the Company had 5,062

employees.

The Company provides benefits and facilities to deserving staffs. Workers employed at new

scale are imparted with in-house training to bring all round improvement in their working

knowledge and skill.

Collective participation is encouraged at all level and workers are given incentive for good

performance. Labour issues are mostly addressed by negotiations and conciliation.

h) Cautionary Statement

Statement made above in this section of the report with regard to future outlook and performance

is on the basis of prevailing industry scenario and market conditions as envisaged by us.

Actual results may differ materially from those expressed in the statement.

DIVIDEND

Your Directors don’t recommend dividend on equity shares.


(14)

GENERAL RESERVE

The Company has not transferred any amount to the General Reserve during the financial year ended

31st March, 2017 due to loss incurred by the Company during the year under review.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION

BETWEEN END OF THE FINANCIAL YEAR AND DATE OF REPORT

Subsequent to the end of the financial year on 31st March, 2017 till date, there has been no material

change and/or commitment which may affect the financial position of the Company.

CREDIT RATING

During the year under review, CARE Ratings Ltd. (formerly, The Credit Analysis & Research Ltd.) has

reaffirmed the Credit Rating BB– for Fund Based Facilities of the Company.

DIRECTORS

During the year under review, there was no change in the composition of the Board of Directors except

one Independent Director, Shri Prabir Chakravarti who left for his heavenly abode on 5th February,

2017. The Board of Directors placed on record its appreciation for contribution made by Shri Prabir

Chakravarti during his long association with the Company.

Whole-Time Director

Shri Vijendra Kumar Chaukhani, (holding DIN: 00309895) was re-appointed as Whole-time Director

of the Company for a period of 2 years with effect from 1st August, 2016 whose period of office is liable

to determination by retirement of directors by rotation.

Shri Vijendra Kumar Chaukhani, (holding DIN: 00309895) retires from the Board by rotation at the

forthcoming AGM, and being eligible, offers himself for re-appointment.

Executive Chairman

Shri Pawan Kumar Kanoria, (holding DIN: 00305297) was re-appointed as Executive Chairman of the

Company for a further period of 5 (five) years with effect from. 1st April, 2017.

Statement of Declarations Given by Independent Directors

All Independent Directors of the Company have given declarations that they meet the criteria of

Independence as provided in Section 149(6) of the Companies Act, 2013.

Evaluation of the Performance of the Board, its Committee and Individual Directors

Nomination and Remuneration Committee (NRC) of the Board have devised the criteria for evaluation

of the independent directors, the Board and its Committees. The Board has carried out annual evaluation

of its own performance and that of its Committee and individual Directors. More details on the same are

given in Corporate Governance Report.


(15)

Company’s Policy on Directors’ Appointment and Remuneration including criteria for determining

qualifications, positive attributes, independence of Director and other matters

Pursuant to the requirements of Companies Act, 2013 and SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015, the Nomination and Remuneration Committee review the composition

and diversity of the Board and identify persons who are qualified to become directors in accordance

with the criteria laid down by the Board of Directors of the Company. Nomination and Remuneration

Committee recommend to the Board about the appointment/re-appointment of eligible candidates

including their terms of appointment and remuneration. The remuneration policy including criteria for

determining qualifications, positive attributes, independence of a director have been disclosed in the

report on Corporate Governance.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Sec. 134(5) of the Companies Act, 2013 and to the best of our knowledge

and belief and according to information and explanation received from the day to day operating

management, your directors state that :

(a) in the preparation of annual accounts, the applicable accounting standards have been followed

along with proper explanation relating to material departures;

(b) the Directors have selected such accounting policies and applied them consistently and made

judgments and estimates that are reasonable and prudent so as to give a true and fair view of

the state of affairs of the company at the end of the financial year and of the loss of the

Company for that period;

(c) the Directors have taken proper and sufficient care for the maintenance of adequate

accounting records in accordance with the provisions of this Act, for safe-guarding the assets

of the Company and for preventing and detecting fraud and other irregularities;

(d) the Directors have prepared the annual accounts on a going concern basis;

(e) the Directors have laid down internal financial controls to be followed by the Company and

that such internal financial controls are adequate and are operating effectively; and

(f) there is a proper system to ensure compliance with the provisions of all applicable laws and

that such systems are adequate and operating effectively.

NUMBER OF MEETINGS OF THE BOARD

The Board of Directors met 5 (Five) times during the year under review. More details are available in

the Corporate Governance Report.

KEY MANAGERIAL PERSONEL

There was no change in Key Managerial Personnel (KMP) during the year under review except Shri

Vijendra Kumar Chaukhani who resigned from the post of Chief Financial Officer (CFO) and Shri Shiv

Kumar Agarwal was designated with additional responsibility of Chief Financial Officer (CFO) with

effect from. 9th February, 2017.


(16)

CORPORATE GOVERNANCE

The Corporate Governance Report and certificate from M/s. N. K. & Associates, Practicing Company

Secretaries, certifying compliance of conditions of Corporate Governance as required under Schedule

V to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is attached as

Annexure – I which forms part of this report.

STATUTORY AUDITORS

M/s Singhi & Co., Chartered Accountants (ICAI Registration No. 302049E), Statutory Auditors of the

Company was appointed for a consecutive tenure of three years to hold office upto 2017 subject to

ratification by the members in the every Annual General Meeting . The tenure of appointment of the

Statutory Auditors expires at the ensuing Annual General Meeting and they shall not be eligible for re-

appointment due to expiry of the maximum permissible tenure as the Auditors of your Company.

Based on the recommendation of the Audit Committee, your Board at its meeting held on 30th May,

2017 appointed M/s. Jitendra K Agarwal & Associates, Chartered Accountants, (ICAI Firm Registration

No. 318086E), as Statutory Auditors of the Company in place of the retiring Auditors, M/s Singhi &

Co., Chartered Accountants (ICAI Registration No. 302049E), to hold office from the conclusion of the

ensuing Annual General Meeting until the conclusion of the 26th Annual General Meeting to be held in

2022 subject to approval of the Members of the Company at the ensuing Annual General Meeting and

ratification by the Members of the Company every year thereafter, if required.

A certificate from M/s. Jitendra K Agarwal & Associates, Chartered Accountants, (ICAI Firm Registration

No. 318086E), has been received to the effect that they meet the criteria as laid down under Sections

139 and 141 of the Companies Act, 2013 read with Companies (Audit and Auditors) Rules, 2014, and

also under the provisions of Regulations 33 of the Listing Regulations and are willing to be appointed as

Statutory Auditors of the Company. The proposal for their appointment has been included in the Notice

convening the 21st Annual General Meeting for obtaining approval of the Members of the Company.

SECRETARIAL AUDITOR

A Secretarial Audit was conducted by the Secretarial Auditor, M/s. N. K. & Associates, a firm of Practicing

Company Secretaries, in accordance with the provisions of Sec. 204 of the Companies Act, 2013. The

Secretarial Audit Report in the prescribed format MR-3 is attached as Annexure – II and forms part of

this Report of the Directors. There are no qualifications or observations or remarks made by the Secretarial

Auditor in the Report.

EXTRACT OF THE ANNUAL RETURN

The extract of the Annual Return in Form No. MGT-9 of the Company as provided under sub-section 3

of Section 92 of the Companies Act, 2013 as on 31st March, 2017 is given in Annexure – III forming

part of this report.


(17)

COST AUDITORS

In terms of Section 148 of the Companies Act, 2013 read with rule 14 of the Companies (Audit and

Auditors) Rules, 2014, on the recommendation of Audit Committee the Board of Directors had appointed

M/s N. Radhakrishnan & Co., Cost Accountants (Registration No. 000056), being eligible and having

sought re-appointment, as Cost Auditor of the Company, for a remuneration of Rs. 30,000/- plus applicable

taxes and re-imbursement of out of pocket expenses incurred by them to conduct an audit of the cost

accounting records maintained by the Company for the current financial year beginning from 1st April,

2017 and ending on 31st March 2018 as required in terms of the Companies (Cost Records and Audit)

Amendment Rules, 2015.

As required under Section 148 of the Companies Act, 2013 read with rule 14 of the Companies (Audit

and Auditors) Rules, 2014, the remuneration payable to Cost Auditor is being placed at the ensuing

Annual General Meeting for ratification by the members. M/s N. Radhakrishnan & Co., Cost Accountants

have furnished a declaration as required under Section 141(3)(g) read with Section 148(3) and 148(5)

of the Companies Act, 2013.

As per The Companies (Cost Audit Report) Rules, 2011, the due date for filing the Cost Audit Report

for the previous financial year ended 31st March, 2016 with the Central Government was 30th September,

2016 and the said report was filed by the Cost Auditor within the due date.

QUALIFICATION, RESERVATION OR ADVERSE REMARK IN STATUTORY AUDIT REPORT

AND SECRETARIAL AUDIT REPORT

Qualified opinions by the Statutory Auditors in their Report have been adequately dealt with in the Note

of the Accounts, which is explained hereunder,

The finished goods destroyed by fire were fully insured with the Insurance Company. The Company

received Rs.11,17,81,171/- out of the claim amount of Rs.15,28,61,208/- during the year under review.

Since the Company has filed a case before Kolkata High Court to recover the balance amount of Rs.

4,10,80,037/- and it expects the claim is recoverable, the company will carry out final adjustment after

outcome of the legal case.

The Company has not provided additional bonus liability for the previous year i.e. 2014-15 based on

judicial pronouncement including interim stay order granted for retrospective application of the Act in

case of same industry on similar grounds of which it expects decision in its favour.

Further the Company has planned and also taken several steps which will not only wipe out its losses but

make it profitable and hence the management is confident that it will be able to realize the carry over

deferred tax and MAT Credit Entitlement amount.

There is no qualification, reservation or adverse remark made by the Secretarial Auditor or by the Cost

Auditor for the financial year ended 31st March, 2017.

DEPOSITS

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.


(18)

DISCLOSURE

Following disclosures are made under The Companies (Accounts) Rules, 2014 :

(i) The financial summary or highlights are discussed at the beginning of this report;

(ii) There is no change in the nature of business;

(iii) There is no company which has become or ceased to be the Company’s subsidiary, joint venture

or associate company during the year.

(iv) No significant and material order was passed by the regulators or courts or tribunals impacting

the going concern status and the Company’s operations in future.

LOANS, GUARANTEES AND INVESTMENTS

Particulars of loans and investments made by the Company have been disclosed in the Note No. 2.10

and 2.12 to the Financial Statement.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All the transactions with related parties entered during the year under review were in the ordinary course

of business and on arm’s length basis. Thus, disclosure in Form AOC-2 is not required. Disclosures as

required under Accounting Standard 18 have been made in Note No. 2.28 to the financial statement for

the year ended 31st March, 2017. The Company has not given any loan or advance to its associate

holding or firms/companies in which directors are interested, no disclosure is required to be made as per

Point A(2) to Schedule V to the SEBI (Listing Obligations and Disclosure Requirements) Regulations,

2015.

INFORMATION PURSUANT TO SECTION 134(3) OF THE COMPANIES ACT, 2013

The prescribed particulars of Conservation of Energy, Technology Absorption and Foreign Exchange

Earnings and Outgo required under Sec. 134(3)(m) read with Rule 8(3) of the Companies (Accounts)

Rules, 2014 is attached as Annexure-IV and forms part of this Report of Directors.

PARTICULARS OF EMPLOYEES

Disclosure in terms of provisions of Section 197(12) of the Companies Act, 2013 read with rule 5 of the

Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been made in

Annexure – V forming part of this Report.

ESTABLISHMENT OF VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company has established a vigil mechanism / whistle blower policy. The policy allows intimation

of concern or misconduct made in good faith by affected persons through a written communication.

Audit Committee oversees the vigil mechanism for disposal of the complaint. Direct access to the

Chairperson of the Audit Committee is also allowed in exceptional cases. The vigil mechanism/whistle

blower policy is available on Company’s website www.reliancejute.com


(19)

ANNEXURE FORMING PART OF THIS REPORT OF THE DIRECTORS

The Annexure referred to in this Report and other information which are required to be disclosed are

annexed herewith and form a part of this Report of the Directors :

Annexure Particulars

I. Corporate Governance Report

II. Secretarial Audit Report

III. Extract of the Annual Return in Form MGT-9

IV. Prescribed particulars of Conservation of Energy, Technology Absorption and

Foreign Exchange Earnings and Outgo

V. Particulars of Employees

APPRECIATION

Your Directors record their sincere appreciation of the dedication and commitment of all employees at

all levels in achieving and sustaining excellence in all areas of the business. Your Directors thank

shareholders, customers, suppliers, bankers and other stakeholders for their continuous support to the

Company.

For and on behalf of the Board

P. K. KANORIA

Ideal Plaza, 11/1, Sarat Bose Road, Chairman

Kolkata, the 30th day of May, 2017 (DIN : 00305297)


(20)

ANNEXURE – I

REPORT ON CORPORATE GOVERNANCE

[Pursuant to Part C of Schedule V of SEBI (Listing Obligations and

Disclosure Requirements) Regulations, 2015, “Listing Regulations”]

1. Company’s Philosophy on Code of Governance

Reliance Jute Mills (International) Ltd. firmly believes in the implementation of best practices of

corporate governance so that the company could achieve its corporate goals and further enhance

stakeholders’ value. It has been its endevour to attach a great deal of importance on ensuring

fairness, transparency, accountability and responsibility towards all stakeholders, besides

consistently implementing the best possible practices by providing optimum level of information

and benefits to all the stakeholders.

2. Board of Directors

a. Composition and Category of Directors

The Board of Directors (the Board) consists of 7 (seven) Directors of which there are three

Non-Executive Independent Directors, one is Executive Director belonging to promoter group

(Executive Chairman), one Executive Director (Managing Director & CEO) and one Executive

Director (Whole-time Director) and one Non-Executive Woman Director belonging to

promoter group.

No director is, inter-se, related to any other director on the Board, except Shri Pawan Kumar

Kanoria (Executive Chairman), Shri Sanjay Hada (Managing Director & CEO) and

Smt. Smita Poddar (Director) of the Company.

b. Details of Directors

Shri Pawan Kumar Kanoria was re-appointed as Executive Chairman of the Company w.e.f.

1st April, 2017 for a period of 5 (five) years. He is vested with powers of overall management

of the affairs of the Company subject to the superintendence and guidance of the Board of

Directors. He is also involved in policy planning, vision & strategy and long term development

activities of the Company, besides Corporate Governance and Board co-ordination. He is the

Chairman of the Board of Directors of the Company.

Shri Sanjay Hada is Managing Director & CEO of the Company. He is responsible for

production, purchase and resource management. He is also responsible for and involved for

improving the production and productivity, policy planning, vision & strategy and long term

development activities of the Company.

Shri Vijendra Kumar Chaukhani was re-appointed as Whole-time Director of the Company

with effect from 1st August, 2016. He was also designated as Chief Financial Officer (CFO)

with effect from 5th May, 2015. He has resigned from the office of Chief Financial Officer


(21)

(CFO) with effect from 9th February, 2017. He is responsible for overall marketing work of

the Company.

Shri Vijendra Kumar Chaukhani retires by rotation and being eligible offers himself for

re-appointment. His re-appointment proposal has been incorporated in the item of agenda of

the notice convening the Annual General Meeting.

All Independent Directors have confirmed that they have complied with the Code for

Independent Directors mentioned in Schedule IV of the Companies Act, 2013 and that they

are not disqualified to act as an independent director in compliance with the provisions of

Sec. 149 of the Companies Act, 2013.

c. Declaration on compliance with Code of Conduct

All Directors and Senior Management have adhered to the Code of Conduct of the Company

during the year and have signed declarations of compliance to the Code of Conduct. The

declaration signed by Shri Sanjay Hada, Managing Director & CEO affirming the compliance

of the Code of Conduct by the Board Members and Senior Management is given separately

in the Annual Report.

d. Shareholding of Directors and Key Managerial Personnel

As on 31st March, 2017 following shares of the Company were held by Directors and Key

Managerial Personnel of the Company :

Name Designation No. of shares held

as on 31.03.2017

Shri Pawan Kumar Kanoria Executive Chairman 6,33,436

Smt. Smita Poddar Non-Executive Director 96,400

Dr. Pranab Kumar Mookerjee Independent Director 1,126

Shri Vijendra Kumar Chaukhani Whole-time Director 20

Shri Shiv Kumar Agarwal President (Finance) & 50

Company Secretary

e. Board Meetings, Annual General Meeting and Attendance

During the financial year ended 31st March, 2017, five Board Meetings were held on 6th

May, 2016, 29th July, 2016, 27th September, 2016, 8th November, 2016 and 9th February,

2017.

Maximum time gap between two meetings was less than 120 days. In terms of Schedule V of

the Companies Act, 2013 and Regulation 25(3) of the SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015, a separate meeting of the independent directors was held

on 31st March, 2017 which was attended by all independent directors.


(22)

The Attendance of the Directors at the Board meetings and the Annual General Meeting and

remuneration paid to them for attending the Board meetings is given below:

Name of Directors No. of Meetings Fees Attendance at

Held AttendedPaid last AGM held

Rs. on 27.09.2016

Shri Pawan Kumar Kanoria 5 5 Nil Yes

Shri Sanjay Hada 5 5 Nil Yes

Shri Vijendra Kumar Chaukhani 5 5 Nil No

Shri Prabir Chakravarti* 5 4 12,000 Yes

Dr. Pranab Kumar Mookerjee 5 4 12,000 No

Shri Pradeep Kumar Jain 5 5 15,000 Yes

Shri Piyush Bhartia 5 2 6,000 Yes

Smt. Smita Poddar 5 4 12,000 No

*Expired on 5th February, 2017.

The Company Secretary is the Secretary of the Board of Directors and attended all meetings

of the Board of Directors.

f. Board Committee

The Board of Directors had already constituted the Audit Committee, Nomination and

Remuneration Committee and Stakeholders Relationship Committee in compliance with the

requirements of the Companies Act, 2013 and Corporate Governance requirements under

Listing Regulations.

The composition, terms of reference, attendance and other details of these Committees are

mentioned later in this Report.

g. Directorships and Committee membership in other Companies

None of the Directors on the Board is a member of more than 10 Committees and Chairman

of more than 5 Committees as specified in Regulation 26(1) of SEBI (Listing Obligations

and Disclosure Requirements) Regulations, 2015.

Independent Directors don’t serve in more than 7 listed companies.

Directorships and membership of Committees in other Companies held by Directors as on

31st March, 2017 are given below :


(23)

Name of Directors No. of other No. of other Committees*

Directorships Chairmanships/Memberships

Chairman Member

Shri Pawan Kumar Kanoria 1 – –

Shri Sanjay Hada 4 – –

Shri Vijendra Kumar Chaukhani 1 – –

Dr. Pranab Kumar Mookerjee 2 – –

Shri Pradeep Kumar Jain – – –

Shri Piyush Bhartia 2 – 2

Smt. Smita Poddar – – –

*Only Audit Committee, Nomination & Remuneration Committee and Stakeholders

Relationship Committee are considered.

3. Audit Committee

a) Constitution and Composition

The details of composition of the Audit Committee under the provisions of Sec. 177 of the

Companies Act, 2013 and Regulation 18 of the Listing Regulations are as under :

Name of Directors Designation Category

Shri Pradeep Kumar Jain Chairman Independent Director

Dr. Pranab Kumar Mookerjee Member Independent Director

Shri Prabir Chakravarti* Member Independent Director

Shri Sanjay Hada Member Executive Director


b) Terms of Reference

The role and terms of reference of the Audit Committee are in accordance with the provisions

of Section 177 of the Companies Act, 2013 and as specified under Part C of Schedule II of

the Listing Regulations. The role of the Audit Committee includes the following :

• oversight of the listed entity’s financial reporting process and the disclosure of its

financial information to ensure that the financial statement is correct, sufficient

and credible;

• recommendation for appointment, remuneration and terms of appointment of auditors

of the listed entity;

• approval of payment to statutory auditors for any other services rendered by the statutory

auditors;

• reviewing, with the management, the quarterly financial statements and annual financial

statements together with auditor’s report thereon before submission to the board

for approval;


(24)

• reviewing, with the management, the statement of uses / application of funds raised

through an issue (public issue, rights issue, preferential issue, etc.);

• reviewing and monitoring the auditor’s independence and performance, and

effectiveness of audit process;

• approval or any subsequent modification of transactions of the listed entity with related

parties;

• scrutiny of inter-corporate loans and investments;

• valuation of undertakings or assets of the listed entity, wherever it is necessary;

• evaluation of internal financial controls and risk management systems;

• reviewing, with the management, performance of statutory and internal auditors,

adequacy of the internal control systems;

• reviewing the adequacy of internal audit function, if any, including the structure of the

internal audit department, staffing and seniority of the official heading the department,

reporting structure coverage and frequency of internal audit;

• discussion with internal auditors of any significant findings and follow up there on;

• reviewing the findings of any internal investigations by the internal auditors into matters

where there is suspected fraud or irregularity or a failure of internal control systems

of a material nature and reporting the matter to the board;

• discussion with statutory auditors before the audit commences, about the nature and

scope of audit as well as post-audit discussion to ascertain any area of concern;

• to review the functioning of the whistle blower mechanism;

• approval of appointment of chief financial officer after assessing the

qualifications, experience and background, etc. of the candidate;

• carrying out any other function as is mentioned in the terms of reference of the audit.

c) Internal Audit

The Internal Auditor appointed by the Company conducts the internal audit and submit its

report to the Audit Committee on half-yearly basis.

d) Meetings and attendance

During the financial year 4 meetings of the Audit Committee were held on 6th May, 2016,

29th July, 2016, 8th November, 2016 and 9th February, 2017. The Attendance of the Directors

at these Audit Committee meetings and remuneration paid to them is given below:

Name of Directors No. of Meetings Fees Paid

Held Attended Rs.

Shri Pradeep Kumar Jain 4 4 2,000

Shri Sanjay Hada 4 4 –

Shri Prabir Chakravarti* 4 3 1,500

Dr. Pranab Kumar Mookerjee 4 4 2,000



(25)

Representative of the Statutory Auditors was invited to the meeting of the Audit Committee.

Minutes of the Audit Committee are placed before the Board meeting for noting. The Chairman

of the Audit Committee was present at the last Annual General Meeting. The Company

Secretary acts as the Secretary of the Audit Committee meeting and accordingly, Shri Shiv

Kumar Agarwal, President (Finance) & Company Secretary, had attended all these meetings.

4. Nomination and Remuneration Committee

a) Constitution and Composition

The details of composition of Nomination and Remuneration Committee pursuant to the

provisions of Sec. 178 of the Companies Act, 2013 and Regulation 19 of the Listing

Regulations are as under :


Shri Pradeep Kumar Jain Member Independent Director

Dr. Pranab Kumar Mookerjee Member Independent Director


Shri Piyush Bhartia Member Independent Director


Terms of Reference

The role and terms of reference of the Nomination and Remuneration Committee are in

accordance with the provisions of Section 178 of the Companies Act, 2013 and as specified

under Part D(A) of Schedule II of the Listing Regulations. The role of the Nomination and

Remuneration Committee includes the following :

• formulation of the criteria for determining qualifications, positive attributes and

independence of a director and recommend to the board of directors a policy

relating to the remuneration of the directors, key managerial personnel and other

employees;

• formulation of criteria for evaluation of performance of independent directors and the

board of directors;

• devising a policy on diversity of board of directors;

• identifying persons who are qualified to become directors and who may be

appointed in senior management in accordance with the criteria laid down and

recommend to the board of directors their appointment and removal;

• whether to extend or continue the term of appointment of the independent director on

the basis of the report of performance evaluation of independent directors.

b) Attendance

During the financial year ended 31st March, 2017, 1(one) meeting of the Nomination and

Remuneration Committee were held on 6th May, 2016. The Attendance of Directors at these

Committee meetings and remuneration paid to them are given below :


(26)


Held Attended Rs.

Shri Pradeep Kumar Jain 1 1 500

Dr. Pranab Kumar Mookerjee 1 1 500

Shri Prabir Chakravarti* 1 1 500

Shri Piyush Bhartia 1 1 500


c) Remuneration Policy

The Remuneration Policy is available on the Company’s website www.reliancejute.com

5. Remuneration to Directors

a) The Non-Executive Directors are entitled to sitting fees for every meeting of the Board or

Committee thereof attended by them. They are also entitled to commission not exceeding 1%

of the net profits of the Company. The Chairman, Managing Director & CEO and Whole-

time Director don’t receive sitting fees for attending the meetings of the Board or any

Committee thereof.

b) Details of remuneration paid to Non-Executive Directors

Total Remuneration paid to Non-Executive Directors for attending meetings of the Board

and Committees during the year ended 31st March, 2017 is given below :

Name of Directors Sitting Fees Commission Total

(Rs.) (Rs.) (Rs.)

Dr. Pranab Kumar Mookerjee 14,500 – 14,500

Shri Prabir Chakravarti* 14,000 – 14,000

Shri Pradeep Kumar Jain 17,500 – 17,500

Shri Piyush Bhartia 6,500 – 6,500

Smt. Smita Poddar 12,000 – 12,000


c) Details of remuneration paid to Executive Directors

Particulars Shri P. K. Shri S. Hada Shri V. K.

Kanoria (Rs.) (Rs.) Chaukhani (Rs.)

Salary and Allowances 84,00,000 60,00,000 19,57,209

Cont. to Provident Fund 8,40,000 6,00,000 1,44,978

Cont. to Superannuation Fund 1,00,000 1,00,000 1,00,000

Total 93,40,000 67,00,000 22,02,187

The appointment of the Executive Directors is governed by the Articles of Association of the

Company and the resolutions passed by the Board of Directors and the members of the

Company.

All appointments and terms of remuneration are being considered by the Board based on the

recommendation of the Nomination and Remuneration Committee.


(27)

As per terms of appointment, the Company and the Executive Directors have the right to

terminate the appointment by giving one months’ prior notice in writing to the other. There is

no provision for payment of severance fees under the resolutions governing the appointment

of Executive Directors.

The Company has not issued any stock options to its Directors.

None of the Non-Executive Directors except Smt. Smita Poddar, Shri Vijendra Kumar

Chaukhani and Dr. Pranab Kumar Mookerjee hold any share in the Company.

The Company has not entered into any material pecuniary relationship or transactions with

the Non-Executive Directors.

6. Constitution of Stakeholders Relationship Committee

a) Composition

Dr. Pranab Kumar Mookerjee, an Independent Director of the Company, is the Chairman of

the Stakeholders Relationship Committee. The composition of Stakeholders Relationship

Committee is as follows:


Dr. Pranab Kumar Mookerjee Chairman Independent Director


Shri V. K. Chaukhani Member Whole-time Director


b) Meetings and attendance

During the financial year four meetings of Stakeholders Relationship Committee were held

on 6th May, 2016, 29th July, 2016, 8th November, 2016 and 9th February, 2017. The

Attendance of the Directors at these Stakeholders Committee meetings and fees paid to them

is given below :


Held Attended Rs.

Dr. Pranab Kumar Mookerjee 4 4 –

Shri Prabir Chakravarti* 4 3 –

Shri V. K. Chaukhani 4 4 –


c) Scope of Stakeholders Relationship Committee

The Committee deals with various matters relating to redressal of shareholders' and investors'

queries and grievances such as transfers and transmissions of shares, issue of duplicate share

certificates, sub-division and consolidation of certificates, non- receipt of annual reports,

dividend warrants etc.

The Committee also reviews the status of dematerialisation / re-materialisation of shares and

suggest measures for improvement of procedures and systems.

d) Compliance Officer

Shri S. K. Agarwal, President (Finance) & Company Secretary acted as the Secretary to all the

Committees and Compliance Officer of the Company and his contact details are as given below :

Shri Shiv Kumar Agarwal

President (Finance) & Company Secretary


(28)

Reliance Jute Mills (International) Ltd.

Ideal Plaza, South Block, 4th Floor

11/1, Sarat Bose Road

Kolkata-700 020

Tel. No. : (033) 2280 7017/18, Dir. : 8232018850

Fax No.: (033) 2280 7016

E-mail : [email protected]

e) Pledge of shares

No pledge of shares has been created over the Equity Shares held by the Promoters as on 31st

March, 2017.

f) Details of complaints from shareholders

No. of complaints remaining unresolved as on 01.04.2016 Nil

No. of complaints received during the year Nil

No. of complaints resolved during the year Nil

No. of complaints unresolved as on 31.03.2017 Nil

7. Risk Management Committee

Pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, constitution

of Risk Management Committee was made applicable to only top 100 listed entities, determined

on the basis of market capitalisation, as at the end of immediate previous financial year. Since the

Company doesn’t fall under the category of aforesaid listed Companies, it was decided to discontinue

existing Risk Management Committee which was formed by the Board of Directors at its meeting

held on 5th May, 2015. Audit Committee, apart from its existing responsibilities, also monitor the

areas of risks, its assessment and mitigation.

8. General Body Meetings

a) Location and date/time where last three Annual General Meetings (AGM) were held

and No. of Special Resolutions passed :

AGM Relating to Date Time Venue No. of

No. Financial Special

Year Resolutions

passed

18th 31.03.2014 27.09.2014 4.00 PM Keshari Devi Kanoria Hall, 5

123, Dr. Meghnad Saha Sarani

(Southern Avenue), Kolkata-700 029








(29)

At the Annual General Meeting held on 27th September, 2014, five Special Resolutions were

passed for (i) increase in remuneration of Shri Pawan Kumar Kanoria, Executive Chairman

of the Company, (ii) for appointment of Shri Sanjay Hada as Managing Director of the

Company for a period of 5 (five) years with effect from 1st January, 2014, (iii) for appointment

of Shri Vijendra Kumar Chaukhani as Whole-time Director of the Company for a period of 2

(two) years with effect from 1st August, 2014, (iv) for determining the maximum limit per

annum of related party transactions by the Company with related parties for a period upto 5

(five) years and (v) for determining the maximum limit for making contribution by the

Company to the charitable and other funds.

At the Annual General Meeting held on 28th August, 2015, three Special Resolutions were

passed for (i) adoption of new Articles of Association in substitution of existing one, (ii)

increase in Authorized Share Capital of the Company and (iii) approval of the members for

issuance of Preference Shares.

At the Annual General Meeting held on 27th September, 2016, one Special Resolution was

passed for appointment of Shri Pawan Kumar Kanoria as Executive Chairman of the Company

for a period of 5 (five) years with effect from 1st April, 2017.

b) Postal Ballot

No Special Resolution was passed during the previous year through postal ballot.

9. Disclosures

a) Details of transactions with related parties have been reported in the Notes to Accounts.

These disclosures are also made for the purpose of Regulation 10(1)(a) of the Securities and

Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations,

2011. All the transactions with related parties are at arm’s length basis and there are no

materially significant related party transactions which may have potential conflict with the

interests of the Company at large.

b) There were no instances of non-compliance by the Company or any penalties or strictures

imposed on the Company by Stock Exchange or SEBI or any statutory authority on any matter

related to capital markets during the last three years.

c) The Company has in place an Employee Concern (Whistle Blower Policy) which is also

available on the Company’s website www.reliancejute.com. No personnel have been denied

access to the Audit Committee to lodge their grievances.

d) The Company has made compliance with corporate governance requirements as specified in

Regulations 17 to 27 and clause (b) to (i) of sub-regulation (2) of Regulation 46 read with

Schedule V of Listing Regulations.

All mandatory requirements and all the non-mandatory requirements have appropriately been

complied with except that the Company doesn’t bear the expenses of the Chairman’s Office

and doesn’t send the half yearly financial performance to each household of shareholders

who have not registered their E~mail ID with the Company or the Depository Participants.

e) The Management Discussion and Analysis Report forms a part of the Directors’ Report.

f) No presentations were made to institutional investors and analysts during the year.


(30)

g) The Company doesn’t have any subsidiary.

h) There was no public issue, rights issues or other public offerings during the past five years.

The Company has not issued any GDRs/ADRs/Warrants or any convertible instruments.

i) Plant location of the Company are given separately in the Annual Accounts of the Company

and are also available on the Company’s website www.reliancejute.com

j) The Company has applied for listing of its equity shares with Metropolitan Stock Exchange

of India Ltd. (MSEI).

10. Means of Communication :

a) The quarterly, half yearly and annual financial results of the Company are forwarded to The

Calcutta Stock Exchange Limited (CSE) upon approval by the Board of Directors and are

published in Newspapers in English and Bengali (Regional Language). The financial results

are displayed on the Company’s website www.reliancejute.com. The shareholding patterns

are also displayed on the company’s website on quarterly basis.

b) Shareholders communication including Notices and Annual Reports are being sent to the

E~mail address of Members available with the Company and the Depositories. Annual

Accounts are sent to Members at least 25 days before the date of Annual General Meeting.

c) The Company’s website www.reliancejute.com makes online announcement of Board meeting

dates, results of the meetings, quarterly financial results, announcement of the date of Annual

General Meeting, changes in Directors and other announcements. Copies of Notices and

Annual Reports sent to Shareholders are also available on the website.

d) Address for Communication

All communication regarding share transactions, change of address, bank mandates,

nominations etc. should be addressed to the Registrars and Share Transfer Agents of the

Company at the following address :

S. K. Infosolutions Pvt. Ltd.

34/1A, Sudhir Chatterjee Street

Kolkata-700 006

Tel. No.: (033) 2219 6797

Fax No. : (033) 2219 4815

E~mail : [email protected]

Complaints, if any, may also be addressed to the Company Secretary at the Registered Office

at Ideal Plaza., South Block, 4th Floor, 11/1, Sarat Bose Road, Kolkata-700 020 or sent by

E~mail at [email protected]

11. General Shareholders Information:

a) AGM: Date, Time and Venue : 14th September, 2017 at 4.00 P. M. at Keshari Devi

Kanoria Hall, 123, Dr. Meghnad Saha Sarani (Southern

Avenue), Kolkata – 700 029.


(31)

b) Financial Year : The Financial Year of the Company ended on 31st

March, 2017.

c) Date of Book Closure : From 9th September, 2017 to 14th September, 2017

(both days inclusive).

d) Dividend payment date : No dividend was recommended for declaration for the

year ended 31st March, 2017.

e) Listing of Securities : The Calcutta Stock Exchange Ltd.

7, Lyons Range, Kolkata-700 001

Annual Listing Fees have been paid and all

requirements of the Stock Exchange where the shares

of the Company are listed, including submission of

quarterly reports and certificates, were complied with.

f) Stock Code-Physical : 28387 at The Calcutta Stock Exchange Ltd.

Demat ISIN Number INE297E01016

for NSDL & CDSL

g) Market Price Data (High / Low : Information has been given at the end of Clause 11

during each month in 2016-17)

h) Stock performance of the Company : Such information is not available with the CSE.

in comparison to CSE Sensex.

(April, 2016 to March, 2017)

i) Registrar and Share : M/s. S. K. Infosolutions Pvt. Ltd.

Transfer Agent 34/1A, Sudhir Chatterjee Street

Kolkata-700 006

Tel. No. (033) 2219 6797

Fax No. (033) 2219 4815

E-mail: [email protected]

j) Share Transfer System : Information has been given at the end of Clause 11

k) Distribution of Shareholding : Information has been given at the end of Clause 11

as on 31st March, 2017

l) Dematerialization of shares : As on 31st March, 2017, 76.63% of the Company’s

and liquidity paid-up share capital representing 1984189 shares is

held in dematerialized form.

m) Outstanding GDRs / ADRs / : Not issued

Warrants or any convertible

instruments, conversion date

likely impact on equity

n) Plant location : The Company’s plant is located at :

80, West Ghosh Para Road, Bhatpara-743 123

24, Parganas (North), West Bengal


(32)

o) Address for correspondence : Reliance Jute Mills (International) Ltd.

CIN: L17125WB1996PLC081382

“VNSS” Business Centre


11/1, Sarat Bose Road

Kolkata-700 020

Phone: (033) 2280 7017/18

Fax: (033) 2280 7016

E~mail: [email protected]


Information in respect of clause 11(g)

Market Price data: High, Low during 2016-17 is given in the table below :

Month / Year High Low

(Rs.) (Rs.)

April, 2016 2.65 2.65

May, 2016 2.65 2.65

June, 2016 2.65 2.65

July, 2016 2.65 2.65

Aug., 2016 2.65 2.65

Sept., 2016 2.65 2.65

Oct., 2016 2.65 2.65

Nov., 2016 2.65 2.65

Dec., 2016 2.65 2.65

Jan., 2017 2.65 2.65

Feb., 2017 2.65 2.65

March, 2017 2.65 2.65

Information in respect of clause 11(j)

Share Transfer System

Share transfers in physical and demat form are processed by the Registrar and Share Transfer

Agent, M/s S. K. Infosolutions Pvt. Ltd. on regular basis. The transfer/transmission of shares are

approved in accordance with the powers delegated by the Board of Directors to the Chairman,

Managing Director & CEO, Whole-time Director and President (Finance) & Company Secretary.

The shares lodged for transfers/dematerialisation are processed within 15 days from the date of

their lodgement, if transfer instruments are found valid and complete in all respects.

As stipulated by SEBI, M/s. N. K. & Associates, a firm of Practicing Company Secretaries, carries

out the secretarial audit to reconcile the total admitted capital in dematerialised form (held with

NSDL and CDSL) and total number of shares in physical form and to confirm that the total listed

and paid-up capital are in agreement with the aggregate number of shares. This audit is carried out

in every quarter and the report is submitted to The Calcutta Stock Exchange Limited.


(33)

Information in respect of clause 11(k)

(a) Distribution of shareholdings as on 31st March, 2017:

Category No. of Percentage No. of Shares Percentage

(No. of shares) shareholders

Upto 500 1448 91.82 163710 6.33

501 – 1000 77 4.88 53908 2.08

1001 – 2000 22 1.40 28530 1.10

2001 – 3000 12 0.76 30628 1.18

3001 – 4000 3 0.20 10608 0.41

4001 – 5000 1 0.06 4582 0.18

5001 – 10000 - - - -

10001 – 50000 3 0.19 82094 3.17

50001 – 100000 7 0.44 552322 21.33

100001 & above 4 0.25 1663108 64.22

Total 1577 100.00 2589490 100.00

(b) Shareholding Pattern as on 31st March, 2017 :

Category No. of Shares Percentage

Promoter/ Promoter Group 1940878 74.95

Financial Institutions/Banks 6386 0.25

Other Corporate Bodies 373938 14.44

General Public 262522 10.14

Non-Resident Individuals 5766 0.22

Total 2589490 100.00

12. CEO/CFO Certification

Shri Pawan Kumar Kanoria, Executive Chairman, Shri Sanjay Hada, Managing Director & CEO,

Shri Vijendra Kumar Chaukhani, Whole-time Director, Shri Pradeep Kumar Jain, Director and

Shri Shiv Kumar Agarwal, Company Secretary & CFO of the Company have provided annual

certification on the financial statements and cash flow statement to the Board as required under

Regulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

13. Declaration on Compliance of Company’s Code of Conduct

The Board of Directors of the Company have formulated a Code of Conduct applicable to all its members

and Senior Management of the Company incorporating duties of independent directors which has been

posted on the website of the Company www.reliancejute.com. A declaration signed by the Managing

Director & CEO of the Company affirming compliance of the code of conduct by the members of the

Board of Directors and Senior Management of the Company is attached to this report.

14. Corporate Governance Compliance

The Company has complied with the requirements as laid down in the SEBI (Listing Obligations

and Disclosure Requirements) Regulations, 2015 for the purpose of ensuring Corporate Governance.


(34)

A certificate to this effect obtained from Shri Navin Kothari of M/s. N. K. & Associates, Company

Secretaries (FCS No. 5935, CP No. 3725) of the Company, has been attached to this Annual Report.


P. K. KANORIA

Ideal Plaza, 11/1, Sarat Bose Road Chairman

Kolkata, Dated : 30th May, 2017 (DIN:00305297)

Declaration regarding compliance of Code of Conduct as required under SEBI (Listing Obligations

and Disclosure Requirements) Regulations, 2015

I hereby declare that all the Board Members and Key Managerial Personnel (including Senior Management

Personnel) of the Company have affirmed compliance with the Company’s Code of Conduct for the

financial year ended 31st March, 2017.


Ideal Plaza, S. Hada

11/1, Sarat Bose Road, Managing Director & CEO

Kolkata, the 30th day of May, 2017 DIN:00305476

Chief Executive Officer (CEO) and Chief Financial Officer (CFO) Certification as required under

Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

To

The Board of Directors


We, the undersigned, in our respective capacities as Managing Director & CEO and Company Secretary

& CFO of Reliance Jute Mills (International) Ltd. (‘the Company’) to the best of our knowledge and

belief certify that :

(a) We have reviewed financial statements and the cash flow statement for the year ended 31st March,

2017 and based on our knowledge and belief, we state that

(i) these statements do not contain any materially untrue statement or omit any material fact or

contain statements that might be misleading;

(ii) these statements together present a true and fair view of the Company’s affairs and are in

compliance with existing Accounting Standards, applicable laws and regulations.

(b) There are, to the best of our knowledge and belief, no transactions entered into by the Company

during the year which are fraudulent, illegal or violative of the Company’s Code of Conduct.

(c) We accept responsibility for establishing and maintaining internal controls for financial reporting

and have evaluated the effectiveness of internal control systems of the Company pertaining to

financial reporting and we have disclosed to the Auditors and the Audit Committee, deficiencies in

the design or operation of such internal controls, if any, of which we are aware and the steps we

have taken or propose to take to rectify these deficiencies.


(35)

(d) We have indicated to the Auditors and the Audit Committee that –

(i) there have not been any significant changes in internal control over financial reporting during

the year under reference;

(ii) there have not been any significant changes in accounting policies during the year requiring

disclosure in the notes to the financial statements.

(iii) there have not been any instances during the year of significant fraud of which we had become

aware and the involvement therein, if any, of the management or an employee having a

significant role in the Company’s internal control system over financial reporting.

Place: Kolkata S. Hada S. K. Agarwal

Date: 30th May, 2017 Managing Director & CEO Company Secretary & CFO

Practicing Company Secretaries Certificate on compliance with the conditions of Corporate

Governance under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

To the Members


We have examined the compliance of conditions of corporate governance by Reliance Jute Mills

(International) Limited, (the Company) for the year ended 31st March, 2017, as stipulated in SEBI

(Listing Obligations and Disclosure Requirements) Regulations, 2015.

The compliance of conditions of corporate governance is the responsibility of the management. Our

examination was limited to procedures and implementation thereof, adopted by the Company for ensuring

the compliance of the conditions of corporate governance. It is neither an audit nor an expression of

opinion on the financial statements of the Company.

In our opinion and to the best of our information and according to the explanations given to us, we

certify that the Company has complied with the conditions of corporate governance as stipulated in the

above mentioned listing agreement.

We have been explained that no investor grievances are pending for a period exceeding one month

against the Company as per the records maintained by the Company.

We further state that such compliance is neither an assurance as to the future viability of the Company

nor the efficiency or effectiveness with which the management has conducted the affairs of the Company.

For N. K. & Associates

Company Secretaries

(NAVIN KOTHARI)

Proprietor

Kolkata FCS No.5935

Dated the 30th day of May, 2017 C. P. No.3725


(36)

ANNEXURE – II

MR-3

SECRETARIAL AUDIT REPORT

FOR THE FINANCIAL YEAR ENDED ON 31ST MARCH, 2017

[Pursuant to section 204(1) of the Companies Act, 2013 and rule No.9 of the Companies

(Appointment and Remuneration of Managerial Personnel) Rules, 2014]

To,

The Members,

Reliance Jute Mills (International) Limited


11/1 Sarat Bose Road

Kolkata – 700020

I have conducted the secretarial audit of the compliance of applicable statutory provisions and the

adherence to good corporate practices by Reliance Jute Mills (International) Limited (hereinafter called

the company).Secretarial Audit was conducted in a manner that provided me a reasonable basis for

evaluating the corporate conducts/statutory compliances and expressing my opinion thereon.

Based on my verification of the Company’s books, papers, minute books, forms and returns filed and

other records maintained by the company and also the information provided by the Company, its officers,

agents and authorized representatives during the conduct of Secretarial Audit, I hereby report that in my

opinion, the company has, during the audit period covering the financial year ended on 31st March,

2017 complied with the statutory provisions listed hereunder and also that the Company has proper

Board-processes and compliance-mechanism in place to the extent, in the manner and subject to the

reporting made hereinafter :

I have examined the books, papers, minute books, forms and returns filed and other records maintained

by the Company for the financial year ended on 31st March, 2017 according to the provisions of :

(i) The Companies Act, 2013 (the Act) and the rules made thereunder;

(ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the rules made thereunder;

(iii) The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder;

(iv) Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to

the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial

Borrowings;

(v) The following Regulations and Guidelines prescribed under the Securities and Exchange

Board of India Act, 1992 (‘SEBI Act’):-

a) SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;

b) SEBI (Prohibition of Insider Trading) Regulations, 2015;

c) SEBI (Registrars to an Issue and Share Transfer Agents) Regulations, 1993;

d) SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009 (Not applicable

to the Company during the Audit Period);


(37)

e) SEBI (Share Based Employee Benefits) Regulations, 2014 (Not applicable to the

Company during the Audit Period);

f) SEBI (Issue and Listing of Debt Securities) Regulations, 2008 (Not applicable to the

Company during the Audit Period);

g) SEBI (Delisting of Equity Shares) Regulations, 2009 (Not applicable to the Company

during the Audit Period);

h) SEBI (Buyback of Securities) Regulations, 1998 (Not applicable to the Company during

the Audit Period);

I have also examined compliance with the applicable clauses of the following :

(i) The Secretarial Standards issued by The Institute of Company Secretaries of India.

(ii) The SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

During the period under review the Company has complied with the provisions of the Act, Rules,

Regulations, Guidelines, Standards, etc. mentioned above subject to the following observation :

I further report that,

The Board of Directors of the Company is duly constituted with proper balance of Executive Directors,

Non-Executive Directors and Independent Directors. All appointment was made in compliance of the

provision of the Act. However in case of Independent Directors, the company did not have minimum

required 50% Independent Director during the period from 05.02.2017 onwards till date as per the

Regulation 17(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015,

since the Company is having an Executive Director.

Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on

agenda were sent at least seven days in advance, and a system exists for seeking and obtaining further

information and clarifications on the agenda items before the meeting and for meaningful participation

at the meeting.

Majority decision is carried through while the dissenting members’ views are captured and recorded, if

any, as part of the minutes.

I further report that there are adequate systems and processes in the company commensurate with the

size and operations of the company to monitor and ensure compliance with applicable laws, rules,

regulations and guidelines.


Company Secretaries

(NAVIN KOTHARI )

Proprietor

Place : Kolkata FCS No. 5935

Dated : 29th May, 2017 C P No.: 3725

Note : This report is to be read with our letter of even date which is annexed as ‘Annexure A’ and forms

an integral part of this report.


(38)

ANNEXURE – A

To,

The Members

Reliance Jute Mills (International) Limited


11/1 Sarat Bose Road

Kolkata – 700020

My report of even date is to be read along with this letter.

1. Maintenance of secretarial record is the responsibility of the management of the company.

My responsibility is to express an opinion on these secretarial records based on our audit.

2. I have followed the audit practices and processes as were appropriate to obtain reasonable

assurance about the correctness of the contents of Secretarial records. The verification was

done on test basis to ensure that correct facts are reflected in secretarial records. I believe

that the process and practices, I followed provide a reasonable basis for my opinion.

3. In view of applicable financial laws like direct and indirect tax laws, financial records and

books of accounts being subjected to audit by the Internal Auditor, Statutory Auditor and

Cost Auditor and relying on the reports submitted by the above agencies from time to time, I

have not separately verified the financial records and books of accounts of the company.

4. Where ever required, I have obtained the Management representation about the compliance

of laws, rules and regulations and happening of events etc.

5. The compliance of the provisions of corporate and other applicable laws, rules and regulations,

standards is the responsibility of management. My examination was limited to the verification

of procedure on test basis.

6. The Secretarial Audit report is neither an assurance as to the future viability of the company

nor of the efficacy or effectiveness with which the management has conducted the affairs of

the company.


Company Secretaries

(NAVIN KOTHARI)

Proprietor

Place : Kolkata FCS No. 5935

Dated : 29th May, 2017 C P No.: 3725


(39)

ANNEXURE – III

FORM No. MGT-9

EXTRACT OF ANNUAL RETURN

as on financial year ended 31st March, 2017

[Pursuant to Sec. 92(3) of the Companies Act, 2013 and Rule 12(1)

of the Companies (Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS

(i) CIN : L17125WB1996PLC081382

(ii) Registration Date : 18th September, 1996

(iii) Name of the Company : Reliance Jute Mills (International) Ltd.

(iv) Category / Sub-Category : Company limited by shares /

of the Company Indian Non-Government Company

(v) Address of the Registered : Ideal Plaza, South Block, 4th Floor

Office and contact details 11/1, Sarat Bose Road

Kolkata-700 020

Tel. No. (033) 2280 7017/18

Fax No. (033) 2280 7016


(vi) Whether listed company : Yes. Listed at The Calcutta Stock Exchange Ltd.

(vii) Name, Address and Contact : M/s. S. K. Infosolutions Pvt. Ltd.

details of Registrar and 34/1A, Sudhir Chatterjee Street

Transfer Agent , if any Kolkata-700 006

Tel. No. (033) 2219 6797

Fax: (033) 2219 4815


II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

All the business activities contributing 10% or more of the total turnover of the Company shall be

stated :

Sl. Name and Description of NIC Code of the % to total turnover

No. main products/services Products/services of the company

1. Hessian/Decorative 2679 10.66%

2. Sacking 2679 86.46%

3. Yarn 2679 2.88%


(40)

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES

IV. SHARE HOLDING PATTERN (Equity Share Capital Break-up as percentage of Total Equity)

(i) Category-wise Share Holding


(41)


(42)

(ii) Shareholding of Promoters

(iii) Change in Promoters’ Shareholding (Please specify, if there is no change)


(43)

(iv) Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders

of GDRs and ADRs) :


(44)


(45)

(v) Shareholding of Directors and Key Managerial Personnel


(46)

V. INDEBTEDNESS

Indebtedness of the Company including interest outstanding / accrued but not due for payment

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

A. Remuneration to Managing Director, Whole-time Director and/or Manager

(Amount in Rs.)



(47)

B. Remuneration to other Directors



(48)

C. Remuneration to Key Managerial Personnel other than MD/Manager/WTD

VII. PENALTIES / PUNISHMENT/COMPOUNDING OF OFFENCES


(49)

ANNEXURE – IV

Information under Sec. 134(3)(m) of the Companies Act, 2013, read with Rule 8(3) of Companies

(Accounts) Rules, 2014 forming part of the Boards’ Report for the financial year ended 31st March,

2017.

A. CONSERVATION OF ENERGY

a. Awareness towards energy conservation is further enhanced by forming core group consisting

of Department Heads and monitoring areas of further improvement with the help of outside

experts. Some of the measures taken are as follows :

i) All prime movers are regularly checked and monitored for containing power

consumption.

ii) Installations of Philips/Letta/Evergreen make LED tube lights of 18 watt in place of 28

watt.

iii) To reduce consumption of lubricants for energy conservation drive. Measures taken by

using self lubricating bushes like oilite and nylon high quality bushes for minimizing

lubricants consumption in different machines. Using best quality oil to avoid wear and

tear of costly parts in Spreaders and Drawing machines.

iv) Power losses are being eliminated and minimized by taking necessary measures in

changing proper make of electrical switches and appliances.

v) To save power consumption and improve P.F. by adding new capacitors and replacing

defective capacitors regularly as and when required.

vi) Using Teflon coating on steam cylinder for saving power and also re-utilization of

condensate water for different purposes.

vii) To use individual drive motor in place of group drive motor to save power consumption.

b. Additional investment and proposal, if any, being implemented for reduction of consumption

of energy :

During the period under review, several suggestions of energy audit carried out by an outside

agency were implemented, some of which are as follows :

(i) Installation of Power Capacitor to improve line Power factor.

(ii) Replacement of important parts / portion of machines to make them more power efficient.

c. Impact of measures at (a) and (b) above for reduction of energy consumption and consequent

impact on the cost of production of goods – The measures taken shall lead to saving in the

consumption of power in future.

d. Total energy consumption and energy consumption per unit of production – as Form ‘A’


(50)

FORM –A

(A) POWER AND FUEL CONSUMPTION

1. ELECTRICITY Current Year Previous Year

01.04.2016 01.04.2015

To To

31.03.2017 31.03.2016

a. Purchased Units 1,40,65,216 1,42,55,552

Total Amount (Rs.) 11,43,76,740 11,33,87,726

Rate per Unit (Rs.) 8.13 7.95

b. Own Generation through

Diesel Generator (Unit) 2,621 4,636

Unit per litre of Diesel Oil 2.90 1.76

Cost per Unit (Rs.) 19.89 30.48

2. COAL

(B Grade, used for generation of steam in boiler)

Quantity (M.T.) 77.05 29.70

Total Cost (Rs.) 8,23,357 3,07,298

Average Rate (Rs.) per M.T. 10,686 10,347

(B) CONSUMPTION PER UNIT OF PRODUCTION

Products: Jute Goods Unit

Production M. T. 28,310 30,274

Consumption :

Electricity Unit 497 471

Coal K. G. 2.72 0.98

Lower capacity utilization due to shortage of workers has lead to increase in power

consumption unit per ton.

B. TECHNOLOGY ABSORPTION, RESEARCH AND DEVELOPMENT

e. FORM B

Research and Development (R & D)

Specific areas in which R & D carried out by the Company, benefits derived as a result of

R & D and future plan of action :

There is no specific area where R & D has been carried out by the Company because there

is not much of research and development work in individual unit of Jute Industry. However,

there are continuous activities to improve the process and mechanical condition of

equipments adopting new technologies and improved mechanical gadgets as well as testing

system to cope with the rigid norm of export yarn quality and value added products. Dust


(51)

extraction equipments are being adopted at Spreader stage for better environment. New

jute geo-textiles are being developed for newer uses / development projects. We are

involving outside experts in the area of process development and fibre up-grading by using

latest developed chemicals and enzymes. Further, Indian Jute Industries’ Research

Association (IJIRA) of which the Company is a member, is carrying out research and

development work for Industry. The Company participates in many schemes of technology

transfer to the shop floor conducted by IJIRA and Institute of Jute Technology.

Technology absorption, adaptation and innovation

(i) Efforts in brief, made towards technology absorption, adaptation and innovation:

The Company is making continuous efforts in installing the modern machines by

keeping track of latest development.

(ii) Benefits derived as a result of the above efforts e.g. product improvement, cost

reduction, substitutions, etc.:

Improvement of operational efficiency and in quality.

(iii) Details of imported technology:

Modern S4A Looms and Automatic Rapier Looms were imported during the current

year.

C. FOREIGN EXCHANGE EARNINGS AND OUTGO

f. Activities relating to exports, initiatives taken to increase exports, development of

new export markets for product and services and export plan :

The Company continues to explore avenues to increase exports. Every possible effort

is being taken for exploration of export business.

g. Total Foreign Exchange used and earned during the period

(Rs. in Lacs)

(i) Total Foreign Exchange Used : 896.68

(ii) Total Foreign Exchange Earned : 254.99


P. K. KANORIA


Kolkata, the 30th day of May, 2017 (DIN:00305297)


(52)

ANNEXURE – V

Information as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of

the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014


P. K. KANORIA


Kolkata, Dated: 30th May, 2017 (DIN:00305297)


*


(53)

INDEPENDENT AUDITOR’S REPORT

TO THE MEMBERS OF RELIANCE JUTE MILLS (INTERNATIONAL) LIMITED

REPORT ON THE STANDALONE FINANCIAL STATEMENTS

We have audited the accompanying financial statements of RELIANCE JUTE MILLS

(INTERNATIONAL) LIMITED (‘the Company’), which comprise the Balance Sheet as at 31 March

2017, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a

summary of significant accounting policies and other explanatory information.

MANAGEMENT’S RESPONSIBILITY FOR THE STANDALONE FINANCIAL STATEMENTS

The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies

Act, 2013 (“the Act”) with respect to the preparation of these financial statements that give a true and

fair view of the financial position, financial performance and cash flows of the Company in accordance

with the accounting principles generally accepted in India, including the Accounting Standards specified

under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This

responsibility also includes maintenance of adequate accounting records in accordance with the provisions

of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and

other irregularities; selection and application of appropriate accounting policies; making judgments and

estimates that are reasonable and prudent; and design, implementation and maintenance of adequate

internal financial controls, that were operating effectively for ensuring the accuracy and completeness

of the accounting records, relevant to the preparation and presentation of the financial statements that

give a true and fair view and are free from material misstatement, whether due to fraud or error.

AUDITOR’S RESPONSIBILITY

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters

which are required to be included in the audit report under the provisions of the Act and the Rules made

there under.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10)

of the Act. Those Standards require that we comply with ethical requirements and plan and perform the

audit to obtain reasonable assurance about whether the financial statements are free from material

misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures

in the financial statements. The procedures selected depend on the auditor’s judgment, including the


(54)

assessment of the risks of material misstatement of the financial statements, whether due to fraud or

error. In making those risk assessments, the auditor considers internal financial control relevant to the

Company’s preparation of the financial statements that give a true and fair view in order to design audit

procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness

of the accounting policies used and the reasonableness of the accounting estimates made by the Company’s

Directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for

our qualified audit opinion on the standalone financial statements.

BASIS FOR QUALIFIED OPINION

a) The company has received an amount of Rs.11,17,81,171/- from the Insurance Company

during the quarter ended September, 2016 against an Insurance claim of Rs.15,28,61,208/

- on finished goods destroyed by fire during the financial year 2014-15. The balance

recoverable amount of Rs.4,10,80,037/- has not been adjusted for the reasons stated in

Note 2.32(a) of the financial statements.

b) The company has not provided liability of Rs. 1,69,96,092/- on account of revision of

Bonus for financial year 2014-15 as detailed in Note 2.31 of the financial statements.

c) The company has carry forward Deferred Tax Asset (Net) & MAT Credit Entitlement, as

recognized in earlier years, amounting to Rs.5,73,45,575/- & Rs.1,573,207/- respectively

as detailed in note no. 2.11 (a) and note no.2.12(c) based on future profitability projections.

In our opinion, in the absence of virtual certainty/ convincing evidence about the above

projections, the deferred tax assets and MAT credit entitlement recognized in earlier years

should also have been reversed.

In view of the observation made in paragraph (a) to (c) above, reported loss for the year Rs. 4,33,33,970/-

would have been Rs. 16,03,28,881/- and reported Net Surplus under Reserves and Surplus as at Balance

Sheet date of (-) Rs. 10,85,73,875/- would have been (-) Rs.22,55,68,786/-.

QUALIFIED OPINION

In our opinion and to the best of our information and according to the explanations given to us, except

for the possible effects of the matter described in the basis for qualified opinion paragraph, the aforesaid

standalone financial statements give the information required by the Act in the manner so required and

give a true and fair view in conformity with the accounting principles generally accepted in India, of the

state of affairs of the Company as at 31 March 2017 and its loss and its cash flows for the year ended on

that date.


(55)

EMPHASIS OF MATTER

Attention is drawn to the following :

a) Attention is drawn to Note No. 2.33 regarding the cash loss incurred by the company

during the current as well as the previous financial year substantially eroding its Net worth

and the company’s current liabilities exceeds its current assets as at the balance sheet.

These conditions indicate the existence of material uncertainty that may cast significant

doubt about the company’s ability to continue as a going concern. However, the financial

statements of the company have been prepared on a going concern basis for the reasons

stated in the said note.

b) Attention is drawn to Note No.2.12(a) & 2.12(b) regarding non-recognition of Interest

Income, on Inter-Corporate deposits aggregating to Rs.1,50,00,000/-, due to uncertainty

amounts to Rs.91,59,808/- (Rs.25,00,000/- for the year ended 31st March, 2017).

Our opinion is not qualified in respect of above matter.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”) issued by the Central

Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure

‘A’ a statement on the matters specified in the paragraph 3 and 4 of the Order.

2. As required by Section 143 (3) of the Act, we report that :

a. We have sought and obtained all the information and explanations which to the best of our

knowledge and belief were necessary for the purposes of our audit.

b. In our opinion proper books of account as required by law have been kept by the Company

so far as it appears from our examination of those books;

c. The balance sheet, the statement of profit and loss and the cash flow statement dealt with

by this Report are in agreement with the books of account;

d. Except for the possible effects of the matter described in Basis for qualified opinion

paragraph, in our opinion, the aforesaid standalone financial statements comply with the

Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the

Companies (Accounts) Rules, 2014;


(56)

e. On the basis of the written representations received from the directors as on 31stMarch

2017 taken on record by the Board of Directors, none of the directors is disqualified as on

31stMarch 2017 from being appointed as a director in terms of Section 164 (2) of the Act;

f. The matter described in the Basis of Qualified opinion paragraph and the going concern

matter described under Emphasis of Matter paragraph, in our opinion, may have an adverse

effect on the functioning of the company.

g. With respect to the adequacy of the internal financial controls over financial reporting of

the Company and the operating effectiveness of such controls, refer to our separate Report

in Annexure ‘B’, and

h. With respect to the other matters to be included in the Auditor’s Report in accordance with

Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best

of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigation on its financial position

in its financial statement. [Refer Note 2.12(a) & (b) and 2.30 (a) and (b)];

ii. The Company did not have any long term contracts including derivative contracts for

which there were any material foreseeable losses;

iii. There were no amounts which were required to be transferred to the Investor Education

and Protection Fund by the company.

iv. The Company has provided requisite disclosures in the financial statements as regards

to its holding and dealings in Specified Bank Notes [as defined in the Notification

S.O. 3407(E) dated the 8th November, 2016 of the Ministry of Finance] during the

period from 8th November 2016 to 30th December 2016. Based on audit procedures

and relying on the management representation, we report that the disclosures are in

accordance with books of account maintained by the Company and as produced to us

by the Management – Refer Note 2.35 to the financial statements.

For Singhi &Co.


Firm‘s Registration No. 302049E

(Ankit Dhelia)

Place : Kolkata Partner

Date : 30th day of May, 2017 Membership No. 069178


(57)

ANNEXURE-A TO THE INDEPENDENT AUDITORS’ REPORT

The Annexure referred to in our Independent Auditors’ Report to the members of the Company on the

standalone financial statements for the year ended 31 March 2017, we report that :

i. (a) In respect of fixed assets, the Company has maintained proper records to show full

particulars including quantitative details and situation of its fixed assets except the fixed

assets acquired pursuant to Scheme of Arrangement during 1997-98 in respect of which

individual values are not available.

(b) According to the information and explanation given to us, the fixed assets of the Company

have been physically verified by the management based on a phased manner and no material

discrepancies between the book records and the physical assets have been noticed. In our

opinion, the frequency of verification is reasonable.

(c) According to the information and explanation given to us and on the basis of our examination

of the records of the company, the title deeds of immovable properties are held in the

name of the Company.

ii. In respect of inventories, physical verification has been conducted at reasonable intervals during

the year by the management and in our opinion the frequency of verification is reasonable.

According to the information and explanation given to us No material discrepancies were noticed

on physical verification of inventories as compared to the book records.

iii. The Company has not granted any loan to parties covered in the register maintained under section

189 of the Companies Act, 2013. Accordingly, paragraph 3(iii) of the Order is not applicable.

iv. In our opinion and according to the information and explanations given to us, the Company has

complied with the provisions of section 185 and 186 of the Act, with respect to the loans and

investments made.

v. The Company has not accepted any deposits from the public.

vi. We have broadly reviewed the accounts and records maintained by the Company pursuant to the

Order made by the Central Government for the maintenance of cost records under Section 148(1)

of the Companies Act, 2013. We are of the opinion, that prime-facie, the prescribed accounts and

records have been made and maintained. However, we have not carried out a detailed examination

of the same.

vii. (a) According to the information and explanations given to us and on the basis of our

examination of the books of accounts, the Company is generally regular in depositing

undisputed statutory dues including Provident Fund, Employees’ State Insurance, Income

Tax, Sales Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and

any other statutory dues during the year with the appropriate authorities. According to the


(58)

information and explanations given to us, no undisputed dues as above were outstanding

as at 31st March, 2017 for a period of more than six months from the date they became

payable

(b) According to the information and explanations given to us, the dues of Income Tax, Sales

Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax and Cess which

have not been deposited on account of any dispute and the forum where the dispute is

pending are as under :

Name of the Nature of Amount Year to which Forum where

Statute the Dues (Rs) amount relates dispute is pending

Central Excise Act, 1944 Cess 6,96,631 October, 1980 to Superintendent of Central Excise

September, 1984

CST Act 1956 Sales Tax 1,61,383 2001-02 Commissioner of Commercial Taxes

WBST Act, 1994 Sales Tax 24,43,452 2004-05

CST Act, 1956 Sales Tax 72,72,668 2004-05

CST Act, 1956 Sales Tax 5,35,122 2005-06

VAT Act, 2003 VAT 22,97,852 2005-06

CST Act, 1956 Sales Tax 19,09,020 2006-07

VAT Act, 2003 VAT 40,782 2006-07

CST Act, 1956 Sales Tax 24,29,837 2007-08

VAT Act, 2003 VAT 1,02,694 2007-08

CST Act, 1956 Sales Tax 12,00,281 2008-09

VAT Act, 2003 VAT 10,62,631 2008-09 Appellate and Revisional Board

CST Act, 1956 Sales Tax 1,20,937 2009-10 (WB Commercial Taxes)

VAT Act, 2003 VAT 7,97,981 2009-10

CST Act, 1956 Sales Tax 1,14,24,389 2010-11

VAT Act, 2003 VAT 68,83,715 2010-11

CST Act, 1956* Sales Tax 57,65,522 2011-12

VAT Act, 2003* VAT 11,82,350 2011-12

CST Act, 1956 * Sales Tax 7,13,989 2012-13

VAT Act, 2003* VAT 18,23,109 2012-13

CST Act, 1956 * Sales Tax 5,55,047 2013-14

VAT Act, 2003* VAT 1,10,95,316 2013-14

* Net of amount deposited under appeal.

viii. Based on our audit procedures and according to the information and explanations given to us,

we are of the opinion that the Company has not defaulted in repayment of dues to banks or

financial institutions. There were no debentures outstanding at any time during the year.


(59)

ix. The company did not raise any money by way of initial public offer or further public offer

(including debt instruments) and term loans during the year. Accordingly, paragraph 3(ix) of the

Order is not applicable.

x. According to the information and explanations given to us, no material fraud by the Company or

on the Company by its officers or employees has been noticed or reported during the course of

our audit.

xi. According to the information and explanations given to us and on the basis of our examination

of the records of the company, the company has paid/provided for managerial remuneration in

accordance with the requisite approvals mandated by the provisions of Section 197 read with

Schedule V to the Act.

xii. According to the information and explanation given to us, the company is not a Nidhi Company.

Accordingly, paragraph 3(xii) of the Order is not applicable.

xiii. According to the information and explanations given to us and based on our examination of the

records of the Company, transactions with the related parties are in compliance with sections

177 and 188 of the Act where applicable and details of such transactions have been disclosed in

the financial statements as required by the applicable accounting standards.

xiv. According to the information and explanations given to us and based on our examination of the

records of the Company, the Company has not made any preferential allotment or private

placement of shares or fully or partly convertible debentures during the year.

xv. According to the information and explanations given to us and based on our examination of the

records of the Company, the Company has not entered into non-cash transactions with directors

or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable.

xvi. The Company is not required to be registered under section 45-IA of the Reserve Bank of India

Act, 1934.

For Singhi &Co.



(Ankit Dhelia)




(60)

ANNEXURE - B TO THE INDEPENDENT AUDITOR’S REPORT

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the

Companies Act, 2013 (“the Act”)

We have audited the internal financial controls over financial reporting of RELIANCE JUTE MILLS

(INTERNATIONAL) LIMITED (“the Company”) as of 31stMarch 2017 in conjunction with our audit

of the financial statements of the Company for the year ended on that date.

MANAGEMENT’S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS

The Company’s management is responsible for establishing and maintaining internal financial controls

based on the internal control over financial reporting criteria established by the Company considering

the essential components of internal control stated in the Guidance Note on Audit of Internal Financial

Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (‘ICAI’).

These responsibilities include the design, implementation and maintenance of adequate internal financial

controls that were operating effectively for ensuring the orderly and efficient conduct of its business,

including adherence to company’s policies, the safeguarding of its assets, the prevention and detection

of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation

of reliable financial information, as required under the Companies Act, 2013.

AUDITOR’S RESPONSIBILITY

Our responsibility is to express an opinion on the Company's internal financial controls over financial

reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of

Internal Financial Controls over Financial Reporting (the “Guidance Note”) and the Standards on

Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act,

2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of

Internal Financial Controls and both issued by the Institute of Chartered Accountants of India. Those

Standards and the Guidance Note require that we comply with ethical requirements and plan and perform

the audit to obtain reasonable assurance about whether adequate internal financial controls over financial

reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal

financial controls system over financial reporting and their operating effectiveness. Our audit of internal

financial controls over financial reporting included obtaining an understanding of internal financial

controls over financial reporting, assessing the risk that a material weakness exists, and testing and

evaluating the design and operating effectiveness of internal control based on the assessed risk. The

procedures selected depend on the auditor’s judgment, including the assessment of the risks of material

misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for

our audit opinion on the Company’s internal financial controls system over financial reporting.


(61)

MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING

A company's internal financial control over financial reporting is a process designed to provide reasonable

assurance regarding the reliability of financial reporting and the preparation of financial statements for

external purposes in accordance with generally accepted accounting principles. A company's internal

financial control over financial reporting includes those policies and procedures that: (1) pertain to the

maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and

dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded

as necessary to permit preparation of financial statements in accordance with generally accepted

accounting principles, and that receipts and expenditures of the company are being made only in

accordance with authorizations of management and directors of the company; and (3) provide reasonable

assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of

the company's assets that could have a material effect on the financial statements.

INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL

REPORTING

Because of the inherent limitations of internal financial controls over financial reporting, including the

possibility of collusion or improper management override of controls, material misstatements due to

error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial

controls over financial reporting to future periods are subject to the risk that the internal financial

control over financial reporting may become inadequate because of changes in conditions, or that the

degree of compliance with the policies or procedures may deteriorate.

OPINION

In our opinion, the Company has, in all material respects, an adequate internal financial controls system

over financial reporting and such internal financial controls over financial reporting were operating

effectively as at 31 March 2017, based on the internal control over financial reporting criteria established

by the Company considering the essential components of internal control stated in the Guidance Note

on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered

Accountants of India.

For Singhi &Co.



(Ankit Dhelia)




(62)

CIN : L17125WB1996PLC081382

BALANCE SHEET AS AT 31ST MARCH, 2017

As at 31st As at 31stParticulars Note March, 2017 March, 2016

Rs. Rs.

EQUITY AND LIABILITIESSHAREHOLDERS' FUNDShare Capital 2.1 7,58,94,900 7,58,94,900Reserves and Surplus 2.2 84,39,041 5,04,02,081

8,43,33,941 12,62,96,981NON-CURRENT LIABILITIESLong-Term Borrowings 2.3 7,64,00,000 10,66,00,000Other Long-Term Liabilities 2.4 12,000 12,000Long-Term Provisions 2.5 23,82,86,210 25,27,58,352

31,46,98,210 35,93,70,352CURRENT LIABILITIESShort-Term Borrowings 2.6 22,48,37,826 15,24,43,820Trade Payables 2.7

Total outstanding dues of MSEs – –Total outstanding dues of Creditors other than MSEs 32,53,30,508 40,63,59,551

Other Current Liabilities 2.8 6,44,72,431 8,52,59,521Short-Term Provisions 2.5 5,61,19,546 4,67,76,417

67,07,60,311 69,08,39,309 TOTAL 1,06,97,92,462 1,17,65,06,642ASSETSNON-CURRENT ASSETSFixed Assets

Tangible Assets 2.9 42,20,35,720 40,42,03,487Intangible assets 2.9 2,83,076 4,82,926Capital Work-In-Progress 2.9 2,66,835 31,84,605

42,25,85,631 40,78,71,018Non-Current Investments 2.10 9,028 9,028Deferred Tax Assets (net) 2.11 5,73,45,575 5,73,45,575Long-Term Loans and Advances 2.12 3,17,41,400 2,64,51,983

8,90,96,003 8,38,06,586CURRENT ASSETSInventories 2.13 31,65,03,803 27,93,31,333Trade Receivables 2.14 12,74,82,262 17,34,35,726Cash and Bank Balances 2.15 3,04,75,530 3,12,06,160Short-Term Loans and Advances 2.12 2,01,92,111 2,22,10,653Other Current Assets 2.16 6,34,57,122 17,86,45,166

55,81,10,828 68,48,29,038

TOTAL 1,06,97,92,462 1,17,65,06,642

Significant Accounting Policies 1The Notes are an integral part of the Financial Statements

As per our Report annexed On behalf of the Board of Directors

For Singhi & Co.Chartered Accountants P. K. Kanoria – Chairman (DIN : 00305297)

FRN No.-302049E S. Hada – Managing Director & CEO (DIN : 00305476)

Ankit Dhelia V. K. Chaukhani – Whole time Director (DIN : 00309895)

Partner P. K. Jain – Director (DIN : 00372338)

Membership No. 069178Kolkata, the 30th day of May, 2017 S. K. Agarwal – Company Secretary & CFO


(63)

CIN : L17125WB1996PLC081382

STATEMENT OF PROFIT & LOSS FOR THE YEAR ENDED 31ST MARCH, 2017

For the Year Ended For the Year Ended

Particulars Note 31st March, 2017 31st March, 2016

Rs. Rs.

INCOME

Revenue from Operations (Gross) 2.17 2,31,57,74,086 2,29,35,69,530

Less : Jute Manufacturing Cess 2,24,97,284 2,13,35,234

Revenue from Operations (Net) 2,29,32,76,802 2,27,22,34,296

Other Income 2.18 25,50,903 37,73,192

Total Revenue 2,29,58,27,705 2,27,60,07,488

EXPENDITURE

Cost of Materials Consumed 2.19 1,34,47,92,934 1,45,32,97,140

Purchases of Stock-in -Trade – 1,33,50,910

Changes in Inventories of

Finished Goods & Work-in-Progress 2.20 1,03,50,899 (8,05,09,890)

Employee Benefits Expenses 2.21 64,03,49,009 60,90,39,307

Finance Costs 2.22 3,75,28,758 4,37,47,770

Other Expenses 2.23 29,14,28,926 27,37,78,284

Total 2,32,44,50,526 2,31,27,03,521

Profit/ (Loss) before Tax, Depreciation & Amortization (2,86,22,821) (3,66,96,033)

Depreciation and Amortization Expense 2.24 1,47,11,149 2,08,34,746

Profit/ (Loss) before Tax (4,33,33,970) (5,75,30,779)

Tax Expense :

Current Tax – –

Deferred Tax – –

Income Tax for earlier years – –

Profit/ (Loss) for the year (4,33,33,970) (5,75,30,779)

Earnings Per Share

Basic and Diluted earning per share (in Rs.) (16.73) (22.22)

(Refer Accompanying Note 2.29)

Significant Accounting Policies 1

The Notes are an integral part of the Financial Statements


For Singhi & Co.

Chartered Accountants P. K. Kanoria – Chairman (DIN : 00305297)




Membership No. 069178

Kolkata, the 30th day of May, 2017 S. K. Agarwal – Company Secretary & CFO


(64)

CIN : L17125WB1996PLC081382

CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2017For the year ended For the year ended

PARTICULARS 31st March, 2017 31st March, 2016

A. CASH FLOW FROM OPERATING ACTIVITIES Rs. Rs. Rs. Rs.

Net Profit before tax and extraordinary items (4,33,33,970) (5,75,30,779)

Adjustment for :

Depreciation 1,47,11,149 2,08,34,746

Interest (Net) 3,67,07,989 4,31,16,227

(Profit)/loss on sale of Fixed Assets (10,91,973) 1,14,193

Bad Debts Written off 2,26,779 11,89,778

Sundry Balances Written Off 1,351 3,24,936

(Profit)/loss on sale of Investments – (1,94,523)

Liability no longer required written back – (12,45,481)

5,05,55,295 6,41,39,876

Operating profit before working Capital changes 72,21,325 66,09,097

Adjustment for :

Trade Receivable and other Current Assets 15,58,63,959 (4,53,00,075)

Inventories (3,71,72,470) (9,94,03,250)

Trade Payables & Other Current Liabilities (8,65,48,660) 3,21,42,829 20,42,46,751 5,95,43,426

Cash Generated from Operations 3,93,64,154 6,61,52,523

Direct Taxes Paid / Refund * (79,450) (56,359)

Net Cash from / (Used in) Operating Activities 3,92,84,704 6,60,96,164

B CASH FLOW FROM INVESTING ACTIVITIES

Purchase of Fixed Assets (3,26,15,234) (18,49,552)

Sale of Investments – 6,94,523

Sale of Fixed Assets 12,04,975 3,11,429

Investment in Fixed Deposit (7,05,881) (22,63,449)

Interest Received 8,13,763 7,58,282

Net Cash from / (used in) Investing Activities (3,13,02,377) (23,48,767)

C CASH FLOW FROM FINANCING ACTIVITIES

Issue of Preference Shares – 5,00,00,000

Receipt of Capital Subsidy 63,12,400 8,87,812

Proceeds from Long Term borrowings (3,02,00,000) 1,72,21,572

Proceeds from Short Term borrowings (1,49,72,910) (1,01,89,077)

Proceeds from working capital borrowings from banks 7,23,94,006 (7,21,41,327)

Interest paid (4,29,52,334) (4,87,63,327)

Net Cash from / (used in) Financing Activities (94,18,838) (6,29,84,347)

Net Increase/(Decrease) in

Cash and Cash Equivalents (A+B+C) (14,36,511) 7,63,050

Cash and Cash Equivalents at the beginning of the year

Cash and Cheques in hand 40,51,446 53,05,852

Balances with Scheduled Bank in Current Account 1,70,00,203 2,10,51,649 1,49,82,747 2,02,88,599

Cash and Cash Equivalents at the close of the year

Cash and Cheques in hand 20,26,779 40,51,446

Balances with Scheduled Bank in Current Account 1,75,88,359 1,96,15,138 1,70,00,203 2,10,51,649

Net Increase/(Decrease) in Cash and Cash Equivalents (14,36,511) 7,63,050

Notes to the Cash Flow Statement :

1 This statement has been prepared under indirect method as prescribed by AS-3.

2 Cash and cash equivalents consists of Cash, Cheques in hand and balance with scheduled banks.

3 Previous year figures have been regrouped/rearranged wherever necessary.

* Although investing activities attract tax on income arising out of these activities, for the purposes of the Cash Flow entire tax refund and tax

payment has been considered as part of Operating activities only.


For Singhi & Co.








(65)

1 SIGNIFICANT ACCOUNTING POLICIES

1.1 BASIS OF PREPARATION OF ACCOUNTING STATEMENTS

(a) The financial statements have been prepared to comply in all material respects with the Accounting standards

notified under section 133 of the Companies Act, 2013 ("Act"), read with Rule 7 of the Companies

(Accounts) Rules 2014 and the relevant provisions of the Act. The financial statements have been prepared

on the historical cost basis except for Freehold Land which have been revalued. The accounting policies

adopted in the preparation of financial statements are consistent with those followed in the previous years.

(b) Accounting policies, unless specifically stated to be otherwise, are consistent and are in consonance with

generally accepted accounting principles.

1.2 REVENUE RECOGNITION

Unless specifically stated to be otherwise, all expenses and income have been accounted for on accrual basis.

1.3 INCOME

(a) Sales is net of Cess wherever applicable and realisable. Claims, returns, rebates, discount etc. are excluded

there from.

(b) Claims/Subsidy are accounted for on acceptance/ascertainment of the same.

1.4 EMPLOYEE BENEFITS

(a) Short term employee benefits are recognised as an expense at the undiscounted amount in the Statement of

Profit & Loss of the year in which the related service is rendered.

(b) Post employment and other long-term employee benefits are recognised in the Statement of Profit & Loss

for the year in which the employee has rendered service. The expense is recognised at the present value of

amount payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of

post employment and other long-term benefits are charged to the Statement of Profit & Loss.

1.5 FIXED ASSETS

(a) Gross Block (Tangible Assets)

Fixed Assets have been stated at cost of acquisition or construction inclusive of inward freight, duties and

taxes etc. Freehold Land have been stated at revalued cost.

(b) Intangible Assets

Intangible assets are stated at cost. Cost includes any directly attributable expenditure on making the

assets ready for its intended use.

(c) Depreciation and Amortization

i.) Depreciation on Fixed Assets, other than "Plant & Machinery", "Computer" & "Motor Vehicles", has been

provided on Straight Line Method at applicable useful life prescribed in Schedule II to the Companies

Act, 2013 (‘the Act’) except in "Plant & Machinery" where the useful life is considered as 20 years which

is in excess than life prescribed under Schedule - II as estimated by Chartered Engineers on the basis of

technical evaluation. Certain components where useful life is less than life of Plant & Machinery has been

amortised over the shorter life of that component.

ii) Depreciation on Plant & Machinery, Computers and Vehicles, on Written Down Value method.

iii) Proportionate depreciation on the "Plant & Machinery" eligible for capital subsidy is transferred from

Capital Reserve to the Statement Profit & Loss.

iv) Intangible assets internally generated and/or purchased is amortised over a period of 3 years.

(d) Impairment of Assets

Impairment loss is recognised wherever the carrying amount of an asset is in excess of its recoverable

amount and the same is charged to the Statement of Profit & Loss and carrying amount of the asset is

reduced to its recoverable amount.

Reversal of impairment loss recognised in prior years is recorded when there is an indication that there has

been a change in the estimate of recoverable amount.


(66)

1.6 INVESTMENTS

(a) Long Term Investments are carried at cost after deducting provision in cases where the fall in market

value has been considered of permanent nature.

(b) Current Investments are stated at lower of cost and fair value.

1.7 INVENTORIES

(a) Stores and Spare parts are valued at cost, which is computed on weighted average basis.

(b) Raw Materials are valued at cost or net realisable value whichever is lower. Cost is computed on individual

lot basis and includes procurement charges. Materials and other items held for use in the production of

Inventories are not written down below the cost of the finished products in which they will be incorporated

are expected to be sold at or above cost.

(c) Finished Goods and work in process are valued at lower of the cost or net realisable value. Cost is estimated

cost which represents direct material and appropriate portion of direct labour and manufacturing overheads.

(d) Cess on Finished goods lying in the factory is provided and included in the valuation of stock of finished

goods.

1.8 BORROWING COST

Borrowing Cost incurred in connection with qualifying assets is capitalised as a part of cost till the period

such asset is ready for its intended use. Other Borrowing Costs are charged to the Statement of Profit & Loss.

1.9 CAPITAL SUBSIDY

Capital Subsidy on eligible plant & machinery is credited to Capital Reserve and is recognised as income

in the Statement of Profit & Loss to the extent of depreciation charge of related assets.

1.10 FOREIGN CURRENCY TRANSACTIONS

(a) Foreign Currency realisations/ payments are accounted for on the basis of rates prevailing at the time of

the negotiation/ booked rates.

(b) Year-end balance of foreign currency transaction is translated at the year- end rates and the corresponding

effect is given in the respective accounts. Transactions completed during the year are adjusted on actual basis.

(c) The company uses derivative financial instruments such as forward exchange contracts, futures etc. to

hedge its risks associated with foreign currency fluctuations relating to underlying transactions, highly

probable forecast transactions and firm commitments. In respect of forward exchange contracts with

underlying transactions, the premium or discount arising at the inception of such contract is amortised as

expense or income over the life of contract.

(d) Other Derivative contracts outstanding at the Balance Sheet date are marked to market and resulting loss,

if any, is provided for in the financial statement. Any profit or losses arising on cancellation of derivative

instruments are recognised as income or expense for the period.

1.11 TAXATION

Provision for current tax is made in accordance with the provisions of the Income Tax, 1961. Deferred tax

assets and liabilities are recognised at substantively enacted tax rates, subject to the consideration of

prudence, on timing difference, being the difference between taxable income and accounting income that

originate in one period and are capable of reversal in one or more subsequent periods.

1.12 PROVISION

Provisions are recognised when an enterprise has a present obligation as a result of past event, it is probable

that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate

can be made. Provisions are not discounted to present value and are determined based on best estimate

required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date

and adjusted to reflect the current best estimates.

1.13 CONTINGENT LIABILITIES & CONTINGENT ASSETS

Contingent Liabilities are not provided for in the accounts but are disclosed in the notes. Contingent

Assets are neither recognised nor disclosed in the financial statements.


(67)

Notes to Financial Statements for the year ended 31st March, 2017

As at 31st As at 31st

2.1 : SHARE CAPITAL March, 2017 March, 2016

Number Rs. Rs.

Authorised

30,10,000 Equity Shares of Rs. 10/- each 3,01,00,000 3,01,00,000

(30,10,000)

10,00,000 6% Redeemable Cumulative 10,00,00,000 10,00,00,000

(10,00,000) Preference Shares of Rs.100/- each

13,01,00,000 13,01,00,000

Issued


(25,89,490)



7,58,94,900 7,58,94,900

Subscribed and Paid-up


(25,89,490)



7,58,94,900 7,58,94,900

a) Rights, Preferences & Restrictions attached to shares

i) The company has issued equity shares having par value of Rs.10/- per share. Each holder

of ordinary shares is entitled to one vote per share and equal right for dividend. The

dividend proposed by the Board of Directors is subject to the approval of shareholders in

the ensuing Annual General Meeting, except in case of interim dividend. In the event of

liquidation, the equity shareholders are eligible to receive the remaining assets of the

Company after payment of all preferential amounts, in proportion to their shareholding.

ii) The company has issued 500000, 6% Redeemable Cumulative Preference Shares of Rs.100/-

each on 06th November, 2015 & 12th February, 2016 redeemable at par within 20 years

from the date of allotment. The Preference shareholders shall be entitled to all rights and

privileges as are available under the Companies Act,2013. However, the company may at

its discretion of Board of Directors at any time redeem the shares at par out of the

distributable profits of the Company. Payment of redemption would be made by cheque

within a period of 30 days from the date of receipt of the duly discharged share certificate.


(68)

b) There has been no change/movements in number of equity shares outstanding at the beginning

and at the end of the reporting period. The details of movement in Preference Shares is given

below :

6% Redeemable Cumulative Preference As at 31st March, 2017 As at 31st March, 2016

Shares of Rs. 100/- each No. of Shares Amount (Rs) No. of Shares Amount (Rs)

Opening 5,00,000 5,00,00,000 – –

Add : Shares issued during the year – – 5,00,000 5,00,00,000

Less : Shares redeemed during the year – – – –

Closing 5,00,000 5,00,00,000 5,00,000 5,00,00,000

c) The Company does not have any holding company/ultimate holding company.

d) Details of shareholders holding more than 5% shares in the company:

As at 31st March, 2017 As at 31st March, 2016

Equity Shares of Rs. 10/- each fully paid No. of Shares % Holding No. of Shares % Holding

Shri Pawan Kumar Kanoria 6,33,436 24.46 6,33,436 24.46

B.P. Investments Limited 5,12,078 19.78 5,12,078 19.78

Smt. Usha Kanoria 2,78,382 10.75 1,52,876 5.90

Ajay Investment Enterprise Limited 2,39,212 9.24 2,39,212 9.24

6% Redeemable Cumulative Preference

Shares of Rs. 100/- each fully paid

P.K.Business Enterprise Limited 1,35,000 27.00 1,00,000 20.00

Shraddha Investments Limited 1,25,000 25.00 2,50,000 50.00

Ajay Investment Enterprise Limited 1,00,000 20.00 1,50,000 30.00

Shri Pawan Kumar Kanoria 1,00,000 20.00 – –

Smt. Usha Kanoria 40,000 8.00 – –

e) No shares have been reserved for issue under options and contracts/ commitments for the sale of

shares/disinvestment as at the balance sheet date.

f) No shares have been allotted by way of bonus shares or pursuant to contracts or has been bought

back by the company during the period of 5 years preceeding the date as at which the Balance

Sheet is prepared.

g) No convertible securities has been issued by the company during the year.

h) No calls are unpaid by any Director and Officer of the Company during the year.


(69)



2.2 : RESERVES AND SURPLUS March, 2017 March, 2016

Rs. Rs.

Capital Reserve

As per last Financial Statements 2,03,88,987 2,25,22,738

Add : Capital Subsidy received during the year 44,47,400 –

Less : Transferred to Statement of Profit &

Loss being year's depreciation on related Fixed Assets 30,76,470 21,33,751

2,17,59,917 2,03,88,987

Capital Redemption Reserve

As per last Financial Statements 35,00,000 35,00,000

35,00,000 35,00,000

Revaluation Reserve

As per last Financial Statements 8,85,33,821 8,85,33,821

8,85,33,821 8,85,33,821

General Reserve

As per last Financial Statements 32,19,178 32,19,178

32,19,178 32,19,178

Surplus

As per last Financial Statements (6,52,39,905) (77,09,126)

Add: Profit/ (Loss) for the year (4,33,33,970) (5,75,30,779)

(10,85,73,875) (6,52,39,905)

Net Surplus 84,39,041 5,04,02,081


(70)


2.3 : LONG-TERM BORROWINGS

Non-current portion Current Maturities

(Rs.) (Rs.)

As at 31st As at 31st As at 31st As at 31st

March, 2017 March, 2016 March, 2017 March, 2016

Term Loans from Punjab National Bank – – – 1,40,47,037

Rupee Loans from Body Corporate 3,39,00,000 3,90,00,000 – –

Rupee Loans from Directors – 1,02,50,000 – –

Rupee Loans from Members 4,25,00,000 5,73,50,000 – –

Vehicle Loan from Bank – – – 4,79,812

Vehicle Loan from Others – – – 4,46,061

Total Borrowings 7,64,00,000 10,66,00,000 – 1,49,72,910

Amount disclosed under the head

"Other Current Liability"(Note 2.8) – – – (1,49,72,910)

7,64,00,000 10,66,00,000 – –

The above amount includes

Secured Borrowings – – – 1,49,72,910

Unsecured Borrowings 7,64,00,000 10,66,00,000 – –

7,64,00,000 10,66,00,000 – 1,49,72,910

a) Term Loans from Punjab National Bank

Secured by hypothecation of all movable block assets of the company, present and future, excluding

exclusive charges created with Banks and Financial Institutions for vehicle loans and exclusive

charge by way of mortgage on company's factory land with building & structure, both present and

future and also secured by corporate guarantees and personal guarantee of a director and ex-

director of the company. The term loan has been fully repaid during the year and no dues certificate

has been received from the bank.

b) Rupee Loans from Body Corporate, Directors & Members

The above loans are repayable after March 31, 2018 and carries interest rate @ Nil to 14% p.a.

c) Vehicle Loans

Vehicle Loans are secured by hypothecation of specific vehicles. The vehicle loan has been fully

repaid during the year.


(71)



March, 2017 March, 2016

2.4 :OTHER LONG -TERM LIABILITIES Rs. Rs.

Other Liabilities

Security Deposits 12,000 12,000

12,000 12,000

Long Term Short Term

(Rs.) (Rs.)



2.5 : PROVISION

Provision for Employee Benefits

Bonus – – 2,47,08,598 2,48,75,309

Leave Encashment 70,45,893 70,49,738 14,10,948 19,01,108

Gratuity (Net of Fund 23,12,40,317 24,57,08,614 3,00,00,000 2,00,00,000

Rs.2,67,07,273/-, Previous

year Rs.2,55,71,776/-)

[Refer Accompanying

Note No. 2.27]23,82,86,210 25,27,58,352 5,61,19,546 4,67,76,417



Rs. Rs.

2.6 : SHORT TERM BORROWINGS

Working Capital Borrowings

Cash Credit (Punjab National Bank) 15,87,67,469 6,68,50,085

Packing Credit (Punjab National Bank) 1,35,00,000 –

Buyer's Credit in Foreign Currency (Punjab National Bank) 5,25,70,357 5,71,14,077

Buyer's Credit in Local Currency (South Indian Bank) – 2,84,79,658

22,48,37,826 15,24,43,820

The above amount represents

Secured Borrowings 22,48,37,826 15,24,43,820

22,48,37,826 15,24,43,820

a) Working Capital borrowings and Buyer's Credit are secured by hypothecation of stock of raw materials,

work-in-process, finished goods, stores and spare parts, book debts and charge created on certain fixed

assets and also secured by corporate guarantees and personal guarantee of a director and an ex-director

of the Company.


(72)




Rs. Rs.

2.7 : TRADE PAYABLES

For Goods & Services

Total outstanding dues of Micro and – –

Small Enterprises (MSEs) [Refer Note: 2.7a]

Total outstanding dues of Creditors 32,53,30,508 40,63,59,551

other than Micro and Small Enterprises (MSEs)

32,53,30,508 40,63,59,551

a) Based on the information available with the company from vendors regarding their status under the

Micro, Small and Medium Enterprises Development Act,2006, there are no outstanding dues to suppliers

/ service providers covered under Micro, Small and Medium Enterprises Development Act, 2006

(‘MSMED’). The disclosures as required under the said Act are as under :-


Particulars March, 2017 March, 2016

Rs. Rs.

i) Principal amount and interest due to Supplier

under MSMED act and remaining unpaid. Nil Nil

ii) Interest paid and any payment made to supplier beyond

appointed date (under section 16 of the Act) Nil Nil

iii) Interest due and payable to Suppliers under MSMED Act. Nil Nil

iv) Interest accrued and remaining unpaid as at 31st March, 2017 Nil Nil

v) Interest remaining due and payable under section 23 of the Act Nil Nil

b) Certain Creditor balances are subject to confirmation.



2.8 : OTHER CURRENT LIABILITIES Rs. Rs.

Current maturities of Long Term Debt (Note 2.3)

Term Loans from Punjab National Bank – 1,40,47,037

Vehicle Loan from Bank – 4,79,812

Vehicle Loan from Others – 4,46,061

– 1,49,72,910

Interest payable (other than on borrowings) 1,16,051 83,19,906

Interest accrued but not due on Borrowings 1,40,60,685 1,12,80,406

Duties & Taxes Payable 1,84,63,001 1,96,19,975

Security Deposit 27,36,189 29,05,102

Employee Related Liability 2,56,23,633 2,53,14,591

Advances Received from Customers 34,27,972 28,26,466

Others 44,900 20,165

6,44,72,431 8,52,59,521


(73)

NO

TE

S :

I.N

eces

sary

Appli

cati

on h

as b

een m

ade

for

exem

pti

on u

nder

Sec

tion 2

0 o

f U

rban

Lan

d (

Cei

ling A

nd

Reg

ula

tio

n) A

ct,

1976 f

or

the

exce

ss l

and t

hat

may

be

hel

d u

nder

the

Act

.

II.

a)"F

reeh

old

Lan

d h

ave

bee

n r

eass

esse

d b

y a

gover

nm

ent

appro

ved

val

uer

on t

he

bas

is o

f N

et R

epla

cem

ent

Val

ue

and c

onse

quen

tial

incr

ease

of

Rs.

18,2

8,2

4,0

00/-

hav

e bee

n

cred

ited

to R

eval

uat

ion R

eser

ve

Acc

ount.

Fre

ehold

Lan

d h

ad e

arli

er b

een r

eval

ued

by R

s.5,2

2,4

6,6

46/-

&

Rs.

9,5

1,2

7,9

67/-

on 3

0th

June,

1999 a

nd 3

1st

Au

gu

st,

20

02

resp

ecti

vel

y."

b)

Tota

l dep

reci

atio

n p

rovid

ed d

uri

ng t

he

yea

r in

cludes

Rs.

30,7

6,4

70/-

(P

revio

us

yea

r R

s.21,3

3,7

51/-

) pro

vid

ed o

n P

lant

& M

achin

ery e

ligib

le f

or

capit

al s

ubsi

dy h

as b

een

tran

sfer

red

from

Cap

ital

Res

erve

Acc

ount

to S

tate

men

t of

Pro

fit

& L

oss

.

* o

ther

than

inte

rnal

ly g

ener

ated

No

tes

to F

ina

ncia

l S

tate

men

ts f

or t

he y

ea

r en

ded

31

st M

arch

, 2

01

7

2.9

:

FIX

ED

AS

SE

TS

A)

Tan

gib

le A

sset

s :

Fre

e H

old

Lan

d33,0

8,0

0,0

00

––

33,0

8,0

0,0

00

––

––

33,0

8,0

0,0

00

33,0

8,0

0,0

00

Buil

din

gs

77,0

1,1

14

––

77,0

1,1

14

27,6

4,9

76

4,5

1,4

17

–32,1

6,3

93

44,8

4,7

21

49,3

6,1

38

Pla

nt &

Mac

hin

ery

34,0

2,6

3,0

90

3,4

7,6

5,7

18

22,5

0,2

29

37,2

7,7

8,5

79

27,7

9,2

9,7

51

1,5

2,1

5,2

54

21,3

7,7

25

29,1

0,0

7,2

80

8,1

7,7

1,2

99

6,2

3,3

3,3

39

Furn

iture

& F

ixtu

res

20

,71

,116

––

20,7

1,1

16

12,6

2,8

80

1,7

5,0

08

–14,3

7,8

88

6,3

3,2

28

8,0

8,2

36

Off

ice

Equip

men

ts 3

5,1

8,0

72

3,7

3,5

10

–38,9

1,5

82

25,3

8,9

33

2,4

7,7

28

–27,8

6,6

61

11,0

4,9

21

9,7

9,1

39

Com

pute

rs36,2

3,0

61

3,9

3,7

76

–40,1

6,8

37

34,7

6,1

03

1,5

7,4

57

–36,3

3,5

60

3,8

3,2

77

1,4

6,9

58

Veh

icle

s1,4

3,8

8,1

56

–1,9

0,7

44

1,4

1,9

7,4

12

1,0

1,8

8,4

79

13,4

0,9

05

1,9

0,2

46

1,1

3,3

9,1

38

28,5

8,2

74

41,9

9,6

77

Tota

l70,2

3,6

4,6

09

3,5

5,3

3,0

04

24,4

0,9

73

73,5

4,5

6,6

40

29,8

1,6

1,1

22

1,7

5,8

7,7

69

23,2

7,9

71

31,3

4,2

0,9

20

42,2

0,3

5,7

20

40,4

2,0

3,4

87

B)

Inta

ng

ible

Ass

ets

:

Com

pute

r S

oft

war

e *

14,2

0,0

50

––

14,2

0,0

50

9,3

7,1

24

1,9

9,8

50

–11,3

6,9

74

2,8

3,0

76

4,8

2,9

26

Tota

l 7

0,3

7,8

4,6

59

3,5

5,3

3,0

04

24,4

0,9

73

73,6

8,7

6,6

90

29,9

0,9

8,2

46

1,7

7,8

7,6

19

23,2

7,9

71

31,4

5,5

7,8

94

42,2

3,1

8,7

96

40,4

6,8

6,4

13

C) C

apit

al W

ork

-in

-Pro

gres

s2,

66,8

3531

,84,

605

Tota

l 7

0,3

7,8

4,6

59

3,5

5,3

3,0

04

24,4

0,9

73

73,6

8,7

6,6

90

29,9

0,9

8,2

46

1,7

7,8

7,6

19

23,2

7,9

71

31,4

5,5

7,8

94

42,2

5,8

5,6

31

40,7

8,7

1,0

18

Pre

vio

us

Yea

r 7

0,1

9,7

1,3

39

30,0

4,5

29

11,9

1,2

09

70,3

7,8

4,6

59

27,6

8,9

5,3

36

2,2

9,6

8,4

97

7,6

5,5

87

29,9

0,9

8,2

46

40,7

8,7

1,0

18

Gro

ss B

lock

Dep

reci

ati

on

/ A

mort

izati

on

Net

Blo

ck

Des

crip

tion

As

at

Ad

dit

ion

sD

edu

ctio

ns

As

at

As

at

for

the

Ded

uct

ion

sA

s a

tA

s a

tA

s at

01.0

4.2

016

31.0

3.2

017

01.0

4.2

016

yea

r31.0

3.2

017

31.0

3.2

017

31.0

3.2

016

(Am

ou

nt

in R

s.)


(74)


As at 31st As at 31stMarch, 2017 March, 2016

Rs. Rs.

2.10 : NON-CURRENT INVESTMENTS

a) Investment in Equity Instruments

(Quoted, Non-Trade & Valued At Cost)

Akshat Gases Limited 1,160 fully paid shares

of Rs. 10/- each (Previous year 1,160) 9,028 9,028

9,028 9,028

a) Aggregate Book Value of Quoted Investments 9,028 9,028

b) Aggregate Market Value of Quoted Investments 7,830 7,830

2.11 : DEFERRED TAX ASSETS (NET)Deferred Tax Assets

Arising on account of :

Depreciation 71,92,204 55,75,274

Section 43B items & Others 8,60,49,355 8,71,32,501

Business Losses & Unabsorbed Depreciation 5,99,27,779 4,49,22,334

Deferred Tax Assets 15,31,69,338 13,76,30,109

Less : Not recognised on grounds of prudence 9,58,23,763 8,02,84,534

Deferred Tax Assets (Net) 5,73,45,575 5,73,45,575

a) During the previous year, the company has assessed the status of Deferred Tax Asset (Net) and Deferred

Tax Asset amounting to Rs.15,31,69,338/- (P.Y. Rs. 13,76,30,109/- ) has been arrived at as on 31st

March, 2017. The difference of Rs.9,58,23,763/- (P.Y. Rs.8,02,84,534/-) has not been recognised on

the grounds of prudence. Based on future profitability projections, the management is hopeful of realising

the carry over Deferred Tax Asset amounting to Rs. 5,73,45,575/-.

2.12 : LOANS & ADVANCES Long Term (Rs.) Short Term (Rs.)



Unsecured, considered good

Capital Advances 14,88,318 – – –

Security Deposits 2,09,23,269 2,09,23,269 – –

(A) 2,24,11,587 2,09,23,269 – –

Other Loans and Advances

Advance Tax and TDS 41,03,340 40,23,890 – –

[Net of provision Rs.31,05,000/-,

Previous year Rs.31,05,000/-]

Advance against supply of Goods – – 27,73,807 40,71,528

and Services

Prepaid Expenses 13,12,305 1,96,301 13,87,064 16,64,470

Loans & Advances to Employees – – 32,26,026 38,26,211

Balances with Government

& Statutory Authorities – – 12,32,007 10,75,237

Deposits against demand under dispute 39,14,168 13,08,523 – –

Loan & Advances to Body Corporate – – 1,00,00,000 1,00,00,000

[Refer Note2.12(b)]

MAT Credit Entitlement – – 15,73,207 15,73,207

(B) 93,29,813 55,28,714 2,01,92,111 2,22,10,653


(75)


Long Term (Rs.) Short Term (Rs.)



Unsecured, considered doubtful

Loan & Advances to Body Corporate – – 50,00,000 50,00,000

Less : Provision for doubtful advance – – 50,00,000 50,00,000

(C) – – – –

Total (A+B+C) 3,17,41,400 2,64,51,983 2,01,92,111 2,22,10,653

a) Loan and Advance to Body Corporate includes an Inter-Corporate Loan amounting to Rs.

50,00,000/- advanced to M/s Varun Industries Limited. However, the said company had failed to

repay the principal as well interest on the above amount from May, 2012 onwards due to which

the company has filed a suit with the appropriate authority and accordingly interest income of

Rs.41,33,562/- (including Rs.8,50,000/- for the year) has not been recognised since May, 2012.

However, as an abundant caution the management has made a provision for the above loan amount

in the earlier year.

b) Loan and Advance includes Rs. 50,00,000/- each advanced to two Body Corporates on which

legal proceedings has been initiated. Accordingly, no interest income of Rs. 50,26,246/- (including

Rs.16,50,000/- for the year) has been recognised till 31st March, 2017. However, the management

is confident of recoverability of the principal amount in the near future.

c) The company had recognized MAT Credit Entitlement of Rs.15,73,207/- during the financial

year 2012-13 which could not be availed due to loss incurred in the current and previous financial

year. The management is hopeful of utilizing the MAT Credit Entitlements carried forward based

on the future profitability projections.

e) Security Deposits include following amounts paid to Related Parties :

i) Smt. Vinita Ahmed 52,50,000 52,50,000

ii) Smt. Smita Poddar 70,00,000 70,00,000

iii) Ms. Ashima Jain 52,50,000 52,50,000

iv) M/s Excellent Dealers Limited 15,00,000 15,00,000

v) M/s Vanila Tracom Private Limited 17,00,000 17,00,000


(76)


As at 31st March, 2017 As at 31st March, 2016

2.13 : INVENTORIES Rs. Rs.

(As taken, valued and certified

by the Management)

Raw Materials (Raw Jute) 11,82,57,135 7,43,86,944

Work-in -progress (Jute Goods) 10,32,75,929 12,40,74,034

Finished Goods (Jute Goods)

At Mill 6,35,10,068 5,79,72,473

In Transit 1,44,86,282 7,79,96,350 95,76,671 6,75,49,144

Stores & Spares 1,69,74,389 1,33,21,211

31,65,03,803 27,93,31,333

Current



Rs. Rs.

2.14 : TRADE RECEIVABLES

Outstanding for a period exceeding six months

Unsecured, considered good 40,81,089 67,93,691

(A) 40,81,089 67,93,691

Other Receivables

Unsecured, considered good 12,34,01,173 16,66,42,035

(B) 12,34,01,173 16,66,42,035

Total (A+B) 12,74,82,262 17,34,35,726

a) Certain Debtors balances are subject to confirmation.



2.15 : CASH AND BANK BALANCES Rs. Rs.

Cash and Cash Equivalents

Balances With Banks :

In Current Account 1,75,88,359 1,70,00,203

Cheques/drafts on hand 14,44,044 31,45,780

Cash on hand 5,82,735 9,05,666

(A) 1,96,15,138 2,10,51,649

Other Bank Balances

Balances with Bank held as margin money 1,08,60,392 1,01,54,511

(B) 1,08,60,392 1,01,54,511

Total (A+B) 3,04,75,530 3,12,06,160


(77)




2.16 : OTHER CURRENT ASSETS Rs. Rs.

Unsecured, Considered Good

Interest accrued on Fixed Deposits 2,98,530 2,91,524

Interest accrued on Other Deposits 8,28,123 8,28,123

Insurance Claim Receivable [Refer Note 2.32a] 4,10,80,037 15,48,50,208

Export Incentives Receivable 12,78,830 8,38,770

Capital Subsidy Receivable 1,04,77,000 1,23,42,000

Interest Subsidy Receivable 84,00,000 84,00,000

Others 10,94,602 10,94,541

6,34,57,122 17,86,45,166

For the year ended For the year ended

31st March, 2017 31st March, 2016

2.17 : REVENUE FROM OPERATIONS (Rs.) (Rs.)

Sale of Products (Jute Goods)

i) Domestic

Hessian / Decorative 24,60,41,615 20,75,12,682

Sacking 1,99,30,81,609 1,96,16,36,945

Yarn 4,22,15,751 2,28,13,38,975 60,50,752 2,17,52,00,379

ii) Export

Hessian / Decorative – 12,95,736

Sacking 17,24,116 13,66,813

Yarn 2,41,26,294 2,58,50,410 9,61,40,751 9,88,03,300

(A) 2,30,71,89,385 2,27,40,03,679

Other Operating Revenues

Scrap Sales 34,50,813 79,64,044

Insurance Claim 3,18,995 19,89,000

Sewing & Branding 30,38,867 32,14,867

Export Incentives

(MEIS, Duty Drawback &

Focus Market Scheme) 17,76,026 63,97,940

(B) 85,84,701 1,95,65,851

Total (A+B) 2,31,57,74,086 2,29,35,69,530


(78)




2.18 : OTHER INCOME (Rs.) (Rs.)

Interest Income

On Banks Deposits (TDS Rs. 79,450/-, 7,95,261 5,66,047

Previous year Rs.56,359/-)

On Others (TDS Rs. Nil, 25,508 8,20,769 65,496 6,31,543

Previous year Rs. Nil/-)

Other Non Operating Income

Gain on sale of Investments (Net) – 1,94,523

Gain on sale/discard of Fixed Assets (Net) 10,91,973 –

Net Gain / (Loss) on Foreign Currency

Transaction / Translation 5,71,378 12,06,346

Liability no longer required written back – 12,45,481

Sundry Receipts 66,783 17,30,134 4,95,299 31,41,649

25,50,903 37,73,192



2.19 : COST OF MATERIALS CONSUMED (Rs.) (Rs.)

Raw Materials (Raw Jute) 1,34,47,92,934 1,45,32,97,140

1,34,47,92,934 1,45,32,97,140



(Rs.) (Rs.)

2.20 : (INCREASE)/ DECREASE IN INVENTORIES

OF FINISHED GOODS & WORK-IN-PROGRESS

Inventories at the beginning of the year

Finished Goods 6,75,49,144 4,55,23,365

Work-in -progress 12,40,74,034 6,55,89,923

19,16,23,178 11,11,13,288

Inventories at the end of the year

Finished Goods 7,79,96,350 6,75,49,144

Work-in -progress 10,32,75,929 12,40,74,034

18,12,72,279 19,16,23,178

1,03,50,899 (8,05,09,890)


(79)




2.21 : EMPLOYEE BENEFITS EXPENSE (Rs.) (Rs.)

Salaries & Wages 55,02,54,950 52,26,84,050

Contribution to Provident & Other Funds 8,77,12,199 8,40,81,890

Staff Welfare Expenses 23,81,860 22,73,367

64,03,49,009 60,90,39,307

2.22 : FINANCE COST

Interest Expenses

On Term Loan 6,90,339 35,72,554

On Cash Credit 1,10,69,072 1,31,42,173

On Unsecured Loan 1,58,21,667 1,18,21,817

On Buyer's Credit 11,76,037 26,51,156

On Car Loan 34,857 2,50,963

2,87,91,972 3,14,38,663

Other Borrowing Cost

Applicable Net Gain / Loss on Foreign

Currency Transaction /Translation 1,27,276 15,43,872

Other Financial Charges 86,09,510 1,07,65,235

3,75,28,758 4,37,47,770


2.23 : OTHER EXPENSES 31st March, 2017 31st March, 2016

MANUFACTURING (Rs.) (Rs.)

Stores & Spares consumed 9,91,39,505 9,10,90,239

Power & Fuel 11,82,64,642 11,57,47,455

Repairs To Machinery 63,64,450 81,10,155

Repairs To Buildings 9,58,239 6,80,444

Insurance 44,05,933 39,63,920

(A) 22,91,32,769 21,95,92,213

SELLING AND ADMINISTRATION

Rent 19,92,000 20,28,000

Motor Car Expenses 26,29,067 26,40,856

Travelling Expenses 17,11,555 14,23,753

Rates & Taxes 17,50,071 15,54,835

Export Expenses (including Freight

Rs. 3,44,504/-, Previous year Rs. 3,14,039/-) 18,08,723 37,82,503

Auditor's Remuneration

As Statutory Audit Fees 2,75,000 2,75,000

For Taxation Matters 40,000 40,000

In Other Capacity 1,75,000 4,90,000 1,75,000 4,90,000

Forwarding & Delivery charges 91,14,315 77,89,390

Brokerage & Commission on Sales 31,15,497 31,73,558

Sundry Balances written off (Net) 1,351 3,24,936

Loss on sale/discard of Fixed Assets (Net) – 1,14,193

Bad debts written off 2,26,779 11,89,778

Directors' Fees 64,500 77,500

Charity & Donation 1,50,000 –

Miscellaneous Expenses 3,92,42,299 2,95,96,769

(B) 6,22,96,157 5,41,86,071

Total (A+B) 29,14,28,926 27,37,78,284


(80)


a) Stores and spares consumed includes Rs.1,53,60,977/- on account of Repairs to Machinery

(Previous year Rs.1,40,04,815/-) (fully indigenous).



2.24 : DEPRECIATION AND (Rs.) (Rs.)

AMORTIZATION EXPENSES

Depreciation on Tangible Assets 1,75,87,769 2,28,51,872

Less : Transferred from Capital Reserve 30,76,470 1,45,11,299 21,33,751 2,07,18,121

Amortization of Intangible Assets 1,99,850 1,16,625

1,47,11,149 2,08,34,746

2.25 : a) The Company uses foreign currency forward contracts to hedge its risk associated with foreign

currency fluctuations relating to firm commitments and forecast transactions. The use of such

contracts is consistent with the Company's risk management policy. The Company does not use

forward contracts for speculative purpose.

The particulars of derivative contracts entered into for hedging purposes outstanding as at 31st

March, 2017 are as under :


Particulars March, 2017 March, 2017 March, 2016 March, 2016

INR USD INR USD

Forward contract / Future for receivables 1,87,95,690 2,91,000 67,09,808 98,428

Forward contract / Future for payables 3,07,53,989 4,71,687 2,63,46,167 3,95,054

b) Foreign currency exposure in respect of Purchases (Trade Payables & Buyer's Credit) which are

not hedged by derivative instruments as on 31st March, 2017 amounts to Rs.2,62,66,622/-

(Previous year Rs.3,11,65,774/-).

2.26 : Segment Reporting as per Accounting Standard – 17 prescribed under the Act.

a) Primary Segment (Business)

The Company operates within a single business segment i.e. Jute and Jute Products and accordingly

has considered the Business Segment to be the Primary Segment.


(81)


b) Secondary Segment Information



(Rs.) (Rs.)

Sales - Inside India 2,28,13,38,975 2,17,52,00,379

Sales - Outside India 2,58,50,410 9,88,03,300

Trade Receivable - Inside India 12,40,29,092 17,32,08,947

Trade Receivable - Outside India 34,53,170 2,26,779

Advance Received from Customers - Inside India 34,27,972 28,26,466

Advance Received from Customers - Outside India – –

2.27 : Employee Benefits as per Accounting Standard -15 (Revised)

a) Defined Contribution Plan

The company makes contribution towards Provident Fund, ESIC, Superannuation Fund to a defined

contribution retirement benefit plan for qualifying employees. The Provident fund plan is operated

partly by Regional Provident Fund Commissioner and partly by an independent trust, ESIC by

government agencies and Superannuation Fund by a trust created for the purpose . Under the said

schemes the company is required to contribute a specific percentage of pay roll costs in respect

of eligible employees to the retirement benefit scheme to fund the benefits.

Contribution to Defined Contribution Plan, recognised as expense for the period is as under :



(Rs.) (Rs.)

Employer's Contribution to Provident Fund 95,74,469 97,00,589

Employer's Contribution to Superannuation Fund 4,94,454 5,05,614

Employer's Contribution to Pension Scheme 3,36,44,789 3,31,76,295

Employer's Contribution to Employees State Insurance Scheme 2,25,84,998 2,12,03,514

b) Defined Benefits Plan

The employees' gratuity is a defined benefit plan. The present value of obligation is determined

based on actuarial valuation using the Projected Unit Credit Method, which recognises each

period of service as giving rise to additional unit to employee benefit entitlement and measures

each unit separately to build up the final obligation. The obligation for leave encashment in

respect of all the employees of the Company is recognised in the manner as aforesaid.


(82)

The following Table sets forth the particulars in respect of the Defined Benefit Plans of the Company for the

year ended 31st March, 2017.

Description For the year ended For the year ended


(Rs.) (Rs.)

Leave Leave

Gratuity Encashment Gratuity Encashment

(Funded) (Unfunded) (Funded) (Unfunded) (a) Reconciliation of Opening and Closing balances

of the Defined Benefit Obligation :Defined Benefit obligation at beginning of the year 29,12,80,390 89,50,846 31,64,22,575 91,94,300Current Service Cost 1,56,33,551 11,51,635 1,47,46,799 9,36,902Interest Cost 2,09,33,838 6,97,669 2,37,54,487 7,37,113Actuarial (Gain) / Loss (1,55,75,120) 1,03,62,936 (24660,514) 99,35,918Benefits Paid (2,43,25,069) (1,27,06,246) (38982,957) (1,18,53,387)Defined Benefit obligation at year end 28,79,47,590 84,56,840 291280,390 89,50,846

(b) Reconciliation of the Opening andClosing balances of the Fair Value of Plan Assets :Fair Value of Plan Assets at the beginning of the year 2,55,71,776 – 4,98,02,581 –Expected Return on Plan Assets 19,17,883 – 40,59,511 –Actuarial Gain /(Loss) 6,92,683 – (66,57,359) –Employer contribution 2,28,50,000 – 1,73,50,000 –Benefits paid (2,43,25,069) – (3,89,82,957) –Fair value of plan assets at year end 2,67,07,273 – 2,55,71,776 –Actual return on plan assets 26,10,566 – (25,97,848) –

(c) Reconciliation of fair value of assets and obligationsFair value of plan assets 2,67,07,273 – 2,55,71,776 –Present value of obligation 28,79,47,590 84,56,840 29,12,80,390 89,50,846(Asset)/Liability recognised in Balance Sheet 26,12,40,317 84,56,840 26,57,08,614 89,50,846

(d) Expense recognised in the Statement ofProfit and LossCurrent Service Cost 1,56,33,551 11,51,635 1,47,46,799 9,36,902Interest Cost 2,09,33,838 6,97,669 2,37,54,487 7,37,113Expected Return on Plan Assets (19,17,883) – (40,59,511) –Actuarial (Gain) / Loss (1,62,67,803) 1,03,62,936 (1,80,03,155) 99,35,918Net cost 1,83,81,703 1,22,12,240 1,64,38,620 1,16,09,933Expenses for Gratuity and Leave have beendisclosed under the items "Contribution toProvident and other funds" &" Salaries & Wages" respectively.

(e) Principal Actuarial AssumptionsMortality Table LIC (1994-96) LIC (1994-96) LIC (1994-96) LIC (1994-96)Discount rate (per annum) 7.50% 7.30% 8.00% 7.80%Expected rate of return on plan assets (per annum) 7.50% N.A. 8.00% N.A.Rate of escalation in salary (per annum) 4.00% 4.00% 5.00% 4.00%Expected Average remaining working 18.00 17.64 20.00 18.63lives of employees (Year)Withdrawal Rates Varying between 2%per annum Varying between 2%per annum

and 1% per annum depending on and 1% per annum depending onduration and age of the employees duration and age of the employees

Method Used Projected Unit Credit Method Projected Unit Credit Method

(f) The company expects to contribute Rs.3,00,00,000/- (P.Y. Rs.2,00,00,000/-) to its Gratuity Fund in the 2017-18.

(g) Disclosures showing Funded Status :

Gratuity (Funded) Particulars As at As at As at As at As at

31.03.2017 31.03.2016 31.03.2015 31.03.2014 31.03.2013(12 months) (12 months) (12 months) (12 months) (12 months)

Present Value of Obligation at year end 28,79,47,590 29,12,80,390 31,64,22,575 33,79,00,591 34,45,66,735Fair Value of Plan Asset at year end 2,67,07,273 2,55,71,776 4,98,02,581 8,68,51,265 10,68,86,495Funded Status (26,12,40,317) (26,57,08,614) (26,66,19,994) (25,10,49,326) (23,76,80,240)Unrecognised actuarial gain / loss at end of the year – – – – –Net Asset / (Liability) recognised in Balance Sheet. (26,12,40,317) (26,57,08,614) (26,66,19,994) (25,10,49,326) (23,76,80,240)


(83)


2.28 RELATED PARTY DISCLOSURES AS IDENTIFIED BY THE MANAGEMENT IN

ACCORDANCE WITH ACCOUNTING STANDARD – 18 ARE GIVEN BELOW :

a) Name of Related Parties

i) Key Management Personnel

Shri Pawan Kumar Kanoria Executive Chairman

Shri Sanjay Hada Managing Director & CEO

Shri Vijendra Kumar Chaukhani Whole Time Director

ii) Relatives of Key Management Personnel

Smt.Usha Kanoria

Smt. Vinita Ahmed

Smt. Smita Poddar

Smt. Sonal Hada

Ms.Ashima Jain

iii) Enterprises over which significant control exists

B.P. Investments Limited

Excellent Dealers Limited

Vanila Tracon Private Limited

P.K.Business Enterprise Limited

Vapi Investments Ltd.

Softlinks Merchants Private Limited

Devang Tradecom Private Limited

Aravali Niwas Private Limited

Ajay Investment Enterprise Limited

Shraddha Investments Limited

Pawan Kumar Kanoria (HUF)


(84)

b) Particulars of Transactions during the year ended 31st March, 2017

Nature of Key Management Relatives of Enterprise where

Transaction Personnel Key Management control exists

Personnel

(Rs.) (Rs.) (Rs.)

Issue of Preference Shares – – –

(–) (–) (5,00,00,000)

Remuneration 1,82,42,187 – –

(1,95,25,468) (–) (–)

Purchase of Raw Jute – – 16,79,95,257

(–) (–) (50,40,81,014)

Rent Paid – 16,80,000 3,12,000

(–) (16,80,000) (3,12,000)

Interest Paid – 72,79,348 8,40,000

(–) (4,15,605) (–)

Service Charges – – 1,44,000

(–) (–) (1,44,000)

Director Fees – 12,000 –

(–) (12,000) (–)

Loan Taken 3,19,50,000 3,31,50,000 –

(1,75,50,000) (5,61,20,000) (60,00,000)

Loan Repaid 4,22,00,000 4,80,00,000 –

(85,00,000) (1,53,70,000) (1,28,00,000)

Balance Outstanding at

the year end

Security Deposit – 1,75,00,000 32,00,000

(–) (1,75,00,000) (32,00,000)

Loan – 3,65,00,000 60,00,000

(1,02,50,000) (5,13,50,000) (60,00,000)

Interest Payable – 57,17,397 7,56,000

(–) (4,15,605) –

Trade Payable – – 6,03,95,951

(–) (–) (3,44,85,873)

Figures in brackets relates to corresponding previous year

2.29 : EARNINGS PER SHARE


PARTICULARS 31st March, 2017 31st March, 2016

(Rs.) (Rs.)

(i) Net Profit for the year (Rs.) (4,33,33,970) (5,75,30,779)

(ii) Basic & Weighted average number of 25,89,490 25,89,490

Equity Shares outstanding during the year

(iii) Nominal Value of Shares (Rs.) 10.00 10.00

(iv) Basic & Diluted EPS (Rs.) (16.73) (22.22)



(85)


2.30 : CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF :

a) Cess duty matters in dispute / under appeal Rs. 6,96,631/- (Previous year Rs.6,96,631/-) pertaining

to financial years 1980-81 to 1984-85.

b) Sales Tax & VAT payable due to non-collection of certain declaration forms and the demand

pending under appeal Rs.6,37,32,245/- (Previous year Rs.6,45,15,465/-) pertaining to financial

years 2001-02 to 2013-14. Against the above, an amount of Rs.39,14,168/- (Previous year

Rs.13,08,523/-) has been paid to relevant authorities as deposit against appeal.

c) Bills discounted with Banks and outstanding as at 31st March, 2017 Rs.Nil (Previous year

Rs.68,59,269/-).

d) Outstanding Bank guarantee of Rs. 2,85,99,929 /- (Previous year Rs.2,75,77,289/- ).

e) Estimated amount of contracts remaining to be executed on capital account net of advance/deposit

is Rs. 48,29,688/- (Previous year Rs.Nil/-).

f) Cumulative Preference Share Dividend is in arrear for the period amounting to Rs.37,97,260/-

(Previous year Rs. 7,97,260/-).

2.31 : The company has not provided additional bonus liability of Rs.1,69,96,092/- for the previous year

2014-15 based on judicial pronouncements including interim stay order granted for retrospective

application of Act in case of same industry on similar grounds.

2.32 : a) During the financial year 2014-15, the company had accounted for the insurance claim of

Rs.15,28,61,208/- pending acceptance / ascertainment from insurance company as against the

policy of accounting for insurance claims on acceptance basis. Against the above, an amount of

Rs.11,17,81,171/- was received in the month of September, 2016. A case has been filed before

Kolkata High Court to recover the balance amount along with interest. Pending decision, the

balance amount of Rs. 4,10,80,037/- is carried forward as considered recoverable by the

management and final adjustment will be carried out on outcome of the legal case.

b) As a result of delay of around two years in settlement of claims above, the Compnay had to bear

interest cost of approximately Rs. Three crores. Further on account of non receipt of balance

amount of Rs. Four crores from the insurance company, the company has incurred additional

interest cost of Rs. one and a half crores upto the end of the current financial year.

2.33 : During the year the functioning of Jute Mill was interrupted due to suspension of work between 21st

November, 2016 to 9th December, 2016, followed by continuous disturbance of production due to

labour trouble. Further, due to delay of around 2 years in settlement of insurance claim in respect of

huge fire at Mill, the Company had to incur substantial additional interest cost burden besides loss of

opportunity to purchase raw jute during the period of price rise trend. During the current year the

company has been able to cut down the conversion cost and efforts are on to further reduce such cost.

As a result of cash losses incurred in current as well as previous year, the net worth of the company is

eroding, which may cast significant doubt on the company’s ability to continue as a going concern. The

management is confident of raising further finance, if necessary. The promoters continue to be committed

to provide the required operational and financial support to the company. Accordingly, the financial

statements has been prepared on the basis that the company is a going concern and that no adjustments

are required to the carrying values of assets and liabilities.


(86)


2.34 :Additional Information



a) CIF Value of Imports during the year

Particulars Rs. Rs.

Raw Materials 9,73,22,840 6,24,29,969

Capital Goods 1,78,54,856 –

b) Value of Raw Materials and Store & Spare Parts Consumed

Particulars % Rs. % Rs.

Raw Material

Imported 6.67 8,96,55,664 3.99 5,79,72,358

Indigenous 93.33 1,25,51,37,270 96.01 1,39,53,24,782

100.00 1,34,47,92,934 100.00 1,45,32,97,140

Store & Spare Parts

Imported 0.01 12,515 0.05 42,385

Indigenous 99.99 9,91,26,990 99.95 9,10,47,854

100.00 9,91,39,505 100.00 9,10,90,239

c) Earnings in Foreign Exchange

FOB Value of Exports 2,54,99,582 9,84,89,261

d) Expenditure in Foreign Currency

Foreign Travelling – 2,38,843


(87)


2.35 : Details of Specified Bank Notes held and transacted during the period 8th November 2016 to

30th December 2016 as defined in the Notification S.O. 3407(E) are provided as below :

PARTICULARS SBNs Other Total

Closing cash in hand as on 8th November 2016 13,77,000 9,18,395 22,95,395

Add: Withdrawal from Bank Accounts – 13,25,000 13,25,000

Add: Permitted Receipts – 5,47,468 5,47,468

Less: Permitted Payments – 21,11,136 21,11,136

Less: Amount deposited in Banks 13,77,000 200 13,77,200

Closing cash in hand as on 30th December 2016 – 6,79,527 6,79,527

2.36 : Previous years figures have been re-arranged/re-grouped wherever considered necessary.


For Singhi & Co.







reliance jute 2017 (1) · reliance jute mills (international) limited (2) reliance jute mills...

Documents