| The Directors have pleasure in submitting 33rd Annual Report of the
Company together with the Audited Statements of Accounts for the year
ended 31st March, 2015.
1. FINANCIAL RESULTS
The Company's financial performance for the year under review alongwith
previous year's figures are given hereunder:
(Rs. in lacs)
PARTICULARS F.Y. 2014-15 F.Y. 2013-14
Net Sales / Income from
Business Operations 325.69 270.36
Other Income 55.77 17.78
Total Income 381.46 288.14
Total Expenditure 358.97 270.60
Profit Before Tax 22.49 17,54
Less:_Tax Expenses 1.66 0.73
Profit/(Loss) After Tax 20.83 16.81
Basic & Diluted Earnings
per Equity Share 0.21 0.17
2. OPERATIONAL REVIEW
Gross revenues increased to Rs. 38,146,316.21 a growth of around 32 %
against Rs. 28,814,253.41 in the previous year. Profit before
depreciation and taxation is Rs. 2,249,086.58 against Rs. 1,754,043.47
in the previous year. After providing for depreciation and taxation the
net profit of the Company for the year under review was placed at Rs.
2,083,036.58 as against Rs. 1,681,223.47 in the previous year. Due to
good market conditions the company's turnover in terms of value has
increased at a rate of 32 % during the year under review. The profit
after tax has also increased by 24 %.
3. DIVIDEND
No Dividend was declared for the current financial year due to
conservation of Profits incurred by the Company. The provisions of
Section 125[2] of the Companies Act, 2013 relating to transfer of
Unclaimed Dividend to Investor Education and Protection Fund do not
apply as there was no dividend declared and paid by the Company.
4. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION
186 OF THE COMPANIES ACT, 2013
The company has not given any lo.ans or guarantees covered under the
provisions of section 186 of the Companies Act, 2013. The details of
the investments made by company are given in the notes to the financial
statements.
5. DEPOSITS
Your Company has not accepted any deposits within the meaning of
Section 73 of the Companies Act, 2013 and the Companies (Acceptance of
Deposits] Rules, 2014.
6. SHARE CAPITAL
The paid up equity capital as on March 31, 2015 was Rs. 100,140,000. No
Bonus Shares were issued neither company bought back any of its
securities during the year under review. The company has not issued any
shares with differential voting rights nor granted stock options nor
sweat equity.
7. EXTRACTS OF ANNUAL RETURN
The extracts of Annual Return pursuant to the provisions of Section 92
read with Rule 12 of the Companies (Management and Administration)
Rules, 2014 in prescribed Form - MGT 9 is furnished in Annexure A and
is attached to this Report.
8. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
There was no contract or arrangements made with related parties as
defined under Section 188 of the Companies Act, 2013 during the year
under review. However, the Board has adopted this Policy in terms of
Clause 49(VIII) [A] (2) of the Listing Agreement to ensure that all
Related Party Transactions shall be subject to this policy and approval
or ratification in accordance with Applicable Law. This Policy contains
the policies and procedures governing the review, determination of
materiality, approval and reporting of such Related Party Transactions.
The Policy on Related Party Transactions is uploaded in the Company's
website i.e. www.aarccl.in under the link
http://v7WW.aarccUn/images/pdf-reports/other-corporate-announcements/
Policy'On-Related- Partv-Transactions.pdf
9. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK
MANAGEMENT POLICY OF THE COMPANY
Management and Business Risk Evaluation is an ongoing process within
the Organization. Pursuant to Section 134(3)(n) of the Companies Act,
2013, the Board has framed a Risk Management Policy for the Company.
The Company has in place a mechanism to identify, assess, monitor and
mitigate various risks to key business objectives. Major risks
identified by the business and functions are systematically addressed
through mitigating actions on a continuing basis. At present the
Company has not identified any element of risk which may threaten the
business or existence of the Company.
10. CODE OF CONDUCT
The Board of Directors has approved a Code of Conduct which is
applicable to the Members of the Board and all employees in the course
of day to day business operations of the company. The Company believes
in "Zero Tolerance" against bribery, corruption and unethical dealings
/ behaviors of any form and the Board has laid down the directives to
counter such acts. The code laid down by the Board is known as "model
code of conduct". The Code has been posted on the Company's website
www.aarcl.in. The Code lays down the standard procedure of business
conduct which is expected to be followed by the Directors and the
designated employees in their business dealings and in particular on
matters relating to integrity in the work place, in business practices
and in dealing with stakeholders. All the Board Members and the Senior
Management personnel have confirmed compliance with the Code. All
Management Staff were given appropriate training in this regard.
11. PREVENTION OF INSIDER TRADING
The Company has adopted a Code of Conduct for Prevention of Insider
Trading with a view to regulate trading in securities by the Directors
and designated employees of the Company. The Code requires
pre-clearance for dealing in the Company's shares and prohibits the
purchase or sale of Company shares by the Directors and the designated
employees while in possession of unpublished price sensitive
information in relation to the Company and during the period when the
Trading Window is closed. The Board is responsible for implementation
of the Code. All Board Directors and the designated employees have
confirmed compliance with the Code.
12. COMPANY'S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF
REMUNERATION AND DISCHARGE OF THEIR DUTIES
The Company's Policy relating to appointment of Directors, payment of
Managerial remuneration, Directors' qualifications, positive
attributes, independence of Directors and other related matters as
provided under Section 178(3} of the Companies Act, 2013 is furnished
in Annexure B and is attached to this report.
13. NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW
The Company held 17 Board meetings during the financial year under
review. Detailed information is given in the Corporate Governance
Report.
14. DIRECTORS AND KEY MANAGERIAL PERSONNEL
Pursuant to provisions of Section 152(6] of the Companies Act, 2013 and
Articles of Association of the Company Mrs. Uma Sharma (DIN : 06862354)
will retire by rotation at the ensuing AGM of the Company and being
eligible, offers herself for re-appointment.
Pursuant to provisions of Section 149 of the Companies Act, 2013 which
came into effect from 1st April, 2014, Mr. Rajendra Yadav (DIN:
06980909), Mr. Udit Agarwal (DIN: 07036864) and Mr. Kumar Deepak (DIN:
07052877) were appointed as Independent Directors at 30th September,
2014 ; 6th December,2014 ; 30th December, 2014 respectively. They have
submitted a declaration that each of them meets the criteria of
Independence as provided in Section 149(6) of the Act and there has
been no change in the circumstances which may affect their status as
Independent Director during the year.
Pursuant to provisions of Section 203 of the Companies Act, 2013 which
came into effect from April 1, 2014, the Company has appointed Mr.
Robin Keshri (PAN: AJLPK2935L) as Company Secretary and Mr. Avijit Das
(PAN: AHXPD4883E) as Chief Financial Officer with effect from 2nd
January, 2015 and 20th January, 2015 respectively.
15. PARTICULARS OF MANAGERIAL REMUNERATION
The information required under Section 197 of the Act read with rule
5(1) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 are given below:
I. The ratio of the remuneration of each director to the median
remuneration of the employees of the Company for the financial year:
DIRECTORS RATIO TO MEDIAN
REMUNERATION
Mr. Anupam Khetan 2.50
Mrs. Uma Sharma 0.73
Mr. Rajendra Yadav 0.40
Mr. Sachin Kumar 0.16
Mr. Udit Agarwal 0.27
Mr. Kumar Deepak 0.20
II. There was no increase in remuneration of directors, chief financial
officer, company secretary in the financial year so the percentage
increase in remuneration cannot be expressed. Moreover some
appointments were made during the financial year and hence information
is for part of the year, the same is not comparable.
HI. Percentage increase in the median remuneration of employees in the
financial year: Nil
IV. Number of permanent employees on the rolls of Company: 8
V. Explanation on the relationship between average increase in
remuneration and Company performance: There was no increase in average
remuneration during the financial year.
VI. Comparison of the remuneration of the key managerial personnel
against the performance of the Company:
Aggregate remuneration of key managerial personnel 1.47
(KMP) in FY2Q14-15 [Rs. in lacs)
Revenue (Rs. in lacs] 381.46
Remuneration of KMPs [as % of revenue) 0.39
VII. Variations in the market capitalisation of the Company, price
earnings ratio as at the closing date of the current financial year and
previous financial year:
PARTICULARS 31st MARCH, 2015 31st MARCH, 2014 % CHANGE
Market Capit
lisation [Rs. in
lacs) 4840 4819.18 0.43
Price
Earnings Ratio 230.14 283.06 (18.70)
VIII. Average percentile increase already made in the salaries of
employees other than the managerial personnel in the last financial
year and its comparison with the percentile increase in the managerial
remuneration and justification thereof and point out if there are any
exceptional circumstances for increase in the managerial remuneration:
There was no increase in remuneration during the financial year.
IX. Comparison of the each remuneration of the Key Managerial
Personnel against the performance of the company:
Mr. Anupam Khetan Mr. Avijit Das Mr. Robin Keshri
Whole-time Director Chief Financial
Officer Company Secretary
[w.e.f. 27/10/2014) [w.e.f.
20/01/2015) [w.e.f. 02/01/2015)
Remu
neration
in FY2014- 0.75 0.49 0.24
15 (Rs.
in lacs)
Revenue
(Rs. in
lacs) 381.46
Remune
ration
as % of 0.20 0.13 0.06
revenue
X. The key parameters for any variable component of remuneration
availed by the directors:
N.A.
XI. The ratio of the remuneration of the highest paid director to that
of the employees who are not directors but receive remuneration in
excess of the highest paid director during the year: NA
XII. Affirmation that the remuneration is as per the remuneration
policy of the company:
The Company affirms remuneration is as per the remuneration policy of
the Company.
XIII. There is no employee whose remuneration exceeds the limits
prescribed under Section 197(12) of the Companies Act, 2013 read with
Rule 5(2) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014.
16. REMUNERATION OF DIRECTORS
The details regarding remuneration to Directors are shown separately in
the Corporate Governance Report which forms part of the Annual Report.
17. DECLARATION OF INDEPENDENT DIRECTORS
The Independent Directors have submitted their disclosures to the Board
that they fulfill all the requirements as stipulated in Section 149(6)
of the Companies Act, 2013 so as to qualify themselves to be appointed
as Independent Directors under the provisions of the Companies Act,
2013 and the relevant rules. In terms of Clause 49(II)[B)[7)Cb) of the
Listing Agreement, the Company has adopted a familiarization programme
for Independent Directors. The details of the said programme is
available on the website of the Company i.e. www.aarccl.in under the
link http://www.aarccl.in/images/pdf-reports/other-corporate
announcements/ AAR COMM FAMILARISATION PROGRAMME OF INDEPENDENT
DIRECTORS.pdf
18. DISCLOSURE OF COMPOSITION OF AUDIT COMMITTEE AND PROVIDING VIGIL
MECHANISM
The Audit Committee consists of the following three Independent
Directors:
(a) Mr. Rajendra Yadav - Chairman
(b) Mr. UditAgarwal
(c) Mr. Kumar Deepak
The Company has established a vigil mechanism and overseas through the
committee, the genuine concerns expressed by the employees and other
Directors. The Company has also provided adequate safeguards against
victimization of employees and Directors who express their concerns.
The Company has also provided direct access to the chairman of the
Audit Committee on reporting issues concerning the interests of
co-employees and the Company. The policy on vigil mechanism is attached
with this report as Annexure C and is also available on the website of
the company i.e. www.aarccl.in under the link
http://www.aarccl.in/images/pdf-reports/other-
corporate-announcements/Whistle-BIower-PoIicy.pdf
19. BOARD EVALUATION
Pursuant to the provisions of Section 134(3)(p) of the Companies Act,
2013 and Clause 49(II)(B)(5)(b) of the Listing Agreement with Stock
Exchanges, the Board has carried out an annual performance evaluation
of its own performance, the individual directors' performance including
that of independent directors. The parameters based on which the
evaluation process is being carried out is fixed by the Board in terms
of the provisions of Companies Act, 2013. In a separate meeting of
independent directors, performance of non-independent directors,
performance of the board as a whole and performance of the Chairman was
evaluated, taking into account the views of executive directors and
non-executive directors. The same was discussed in the board meeting
that followed the meeting of the independent Directors, at which the
performance of the Board, its committees and individual directors was
also discussed.
20. DIRECTORS' RESPONSIBILITY STATEMENT
In accordance with the provisions of Section 134(5) of the Companies
Act, 2013 the Board hereby submits its Responsibility Statement:-
a) In the preparation of the annual accounts, the applicable accounting
standards had been followed and there are no material departures;
b) The directors had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the company at the end of the financial year and of the profit and loss
of the company for that period;
c) The directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets^^s of the company and
for preventing and detecting fraud and other irregularities; rfaO^
d) The directors had prepared the annual accounts on a going concern
basis;
e] The directors had laid down internal financial controls to be
followed by the company and that such internal financial controls are
adequete and operating efficiently,
Internal financial control means the policies and procedures adopted by
the Company 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. fj The directors had
devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems are adequate and operating
effectively.
21. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
The Company does not have any Subsidiary, Joint venture or Associate
Company.
22. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL
POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR
TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT
No material changes and commitments affecting the financial position of
the Company occurred between the end of the financial year to which
this financial statements relate on the date of this report.
23. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
The Company has not developed and implemented any Corporate Social
Responsibility initiatives as the said provisions are not applicable.
24. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The provisions of Section 134fjn) of the Companies Act, 2013 do not
apply to our Company. There was no foreign exchange inflow or outflow
during the year under review.
25. STATUTORY AUDITORS
Pursuant to Section 139 of the Companies Act, 2013 and Rules made
thereunder, M/s Agrawal S. Kumar & Associates, Chartered Accountants
(ICAI Firm Registration No. 322324E] were appointed as Statutory
Auditors at the 32nd Annual General Meeting held on September 30, 2014
to hold office until the conclusion of the 35th Annual General Meeting,
subject to ratification by shareholders at each Annual General Meeting.
Ratification of appointment of Statutory Auditors, M/s Agrawal S. Kumar
& Associates and payment of their remuneration for the financial year
2015-16 are to be confirmed and approved in the ensuing Annual General
Meeting.
26. SECRETARIAL AUDIT REPORT
Ms. Sneha Agarwal, Practising Company Secretary (ICSI Membership No.
A38284) has been appointed as Secretarial Auditors of the Company for
financial year ended 31st March, 2015. The Secretarial Audit Report
received from the Secretarial Auditor is annexed to this report marked
as Annexure - D and forms part of this report.
27. EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE
REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND THE PRACTICING COMPANY
SECRETARY IN THEIR REPORTS
Certain observations made in the Secretarial Audit Report with regard
to few lapses under the Companies Act, 2013 relating to filing of
e-forms, investments held by the company, maintenance of statutory
registers were mainly due to ambiguity and uncertainty of the
applicability of the same for the relevant period, However, the company
would ensure in future that all the provisions are, complied to the
fullest extent.
28. CORPORATE GOVERNANCE
The Company is committed to maintain transparency in its operations &
hence it complies with the Corporate Governance requirements.
The Corporate Governance Report as per Clause 49 of the Listing
Agreement and requisite Certificate of Compliance from Statutory
Auditor regarding compliance of conditions of Corporate Governance are
annexed and forms part of the Annual report.
29. MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report of the Company comprising
of management perception, risks and concerns, internal control systems
are annexed and forms part of the Annual report.
30. ACKNOWLEDGEMENTS
The Board takes this opportunity to record its sincere appreciation for
the dedicated services rendered by the employees at all levels and
express their gratitude for the assistance and support extended by its
bankers, business associates, stakeholders and various Government
Authorities during the year under review.
FOR AND ON BEHALF OF THE BOARD OF DIRECTORS
AAR COMMERCIAL COMPANY LTD.
Director / Authorised Signatory
Anupam Khetan
Director
DIN:07003797
Date: 19th August, 2015
Place: Kolkata
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