Dear Members,
The Board of Directors present the Company?s 95th Annual Report and the Company?s audited financial statements for the financial year ended March 31, 2024 (the "Report").
1. FINANCIAL RESULTS
The summarized financial results of the Company for the financial year ended March 31, 2024 are presented below:
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Note: The above figures are extracted from the standalone financial statements prepared in compliance with Indian Accounting Standards (IND AS). The Financial Statements of the Company complied with all aspects with Indian Accounting Standards (IND AS) notified under section 133 of the Companies Act, 2013 (the Act) read with the Companies (Indian Accounting Standards) Rules, 2015, as amended from time to time and other relevant provisions of the Act.
2. STATE OF COMPANY?S AFFAIRS, BUSINESS OVERVIEW AND FUTURE OUTLOOK
The Company was engaged in the business of Textile Manufacturing. However the Company has not been carrying on any business activities due to labour unrest during the year. The Company went into BIFR and the under the revival scheme approved by the BIFR Board and as per direction in the sanctioned scheme the company has to set up a same textile product with similar modern textile machinery on 40% of the company?s land and remaining 60% land can be utilized for real Estate Development and the funds generated from real estate operation will be utilized to redeemed Debentures as well as set up the New Textile units with working capital Requirements. The Company is in process of taking necessary approvals from the Municipal Corporation and other Government departments and it is hopeful that the construction activities can be started in due course of time.
However, during the year under review, the Company has not earned any revenue from operation and earned other income of Rs.75 lakhs against Rs.125 lakhs of the previous year. The Company has incurred net loss of Rs.412 lakhs as compared to Rs. 364 lakhs of the previous year.
During the year, there were no changes in business of the Company, the detailed discussion on Company?s overview and future outlook has been given in the section on ‘Management Discussion and Analysis? (MDA).
3. DIVIDEND
The Company has incurred losses, hence the Board of Director could not recommend any dividend for the financial year under review.
As per Regulation 43A of the SEBI (Listing Obligation and Disclosures Requirements) Regulations, 2015 (the Listing Regulations) the top 1000 listed Companies shall formulate a Dividend Distribution Policy. The Company does not come under the category of top 1000 listed Companies based on the market capitalization.
4. TRANSFER TO RESERVES
The Company has not transferred any amount of profit to the reserves during the financial year under review. Further, the details of movement in Reserve and Surplus is given in note no. 9 of the Financial Statement.
5. DEBENTURES
The Debenture holder after considering the situation of Covid-19 affect the business operation of the Company, has agreed to extend the maturity date of series A Debentures of Rs.30 Crores to 31st March, 2025 on condition that the premium on redemption shall increase by 40% of the face value of the debentures over and above agreed earlier (i.e. 19.2 Crores being 40% of 48 Crores) and series B Debentures of Rs.5 Crores to 31st March, 2025 on condition that the premium on redemption shall increase by 40% of the face value of the debentures over and above agreed earlier (i.e. 2 Crores being 40% of 5 Crores).
6. DEPOSITS
During the year, your Company has not accepted any deposits within the meaning of sections 73 and 76 of the Companies Act, 2013 read with the Companies (Acceptance
of Deposits) Rules, 2014, hence there are no details to disclose as required under Rule 8 (5) (v) and (vi) of the Companies (Accounts) Rules, 2014.
7. DETAILS OF SUBSIDIARIES/JOINT VENTURES/ASSOCIATE COMPANIES
During the year under review, no Company has become or ceased to be a Subsidiary/Joint Venture/ Associate Company of your Company.
8. SHARE CAPITAL
• During the year under review, there were no changes in Authorised and Paid up Share Capital of the Company. The Company has not issued any equity shares with differential rights as to dividend, voting or otherwise, during the year under review.
• The Company has not issued any sweat equity shares to its directors or employees, during the period under review.
9. DIRECTORS AND KEY MANAGERIAL PERSONNEL
The Board as on March 31,2024, comprised of 4 (Four) Directors out of which 3 (Three) are Independent Directors and 1 (One) is Whole Time Director.
Mrs. Shweta Dhruv Shah (DIN 03287393), Whole Time Director, Mr. Dhruv Nikunj Shah, CFO and Ms. Nidhi Vinodkumar Darak, Company Secretary are the Key Managerial Personnel as per the provisions of the Companies Act, 2013 and rules made there under.
None of the Directors of the Company have been debarred or disqualified from being appointed or continuing as Director of company by the Securities and Exchange Board of India (SEBI) and Ministry of Corporate Affairs (MCA) or any such other Statutory Authority.
a. Appointments and Resignations of Directors and Key Managerial Personnel
During the year under consideration, no such changes have been occurred.
However, after the closure of the financial year following changes occurred:
• Mr. Bhavik Shah (DIN: 09605363) was appointed as an Additional NonExecutive & Independent Director on the Board with effect from May 29, 2024 to hold office up to the date of ensuing Annual General Meeting. Based upon the notice received from a member under Section 160(1) of the Act proposing the candidature of Mr. Bhavik Shah for the office of Independent Director, Nomination and Remuneration Committee and the Board have recommended regularisation of his directorship by the shareholders at the ensuing Annual General Meeting, for a period of 5 (five) consecutive years commencing with effect from May 29, 2024 up to May 28, 2029 and in the opinion of the Board, he possesses requisite expertise, integrity and experience (including proficiency).
• Mr. Mihir Rajesh Parikh (DIN: 02896949), was appointed as an Additional Director of the Company to hold office up to the date of ensuing Annual General Meeting of the Company and has been designated as Non-executive and NonIndependent Director of the Company with effect from May 29, 2024. Further, the Board recommends regularisation of his appointment by the members at the ensuing Annual General Meeting.
• Mr. Ratan Karanjia (DIN: 00033108) and Mr. Girishbhai Shah (DIN:03009213), Independent Directors of the Company resigned from the position of Directorship of the Company with effect from the closure of business hours on May 29, 2024.
b. Director Liable to Retire by Rotation
In terms of Section 152 of the Companies Act, 2013, Shweta Dhruv Shah (DIN: 03287393), Director liable to retire by rotation shall retire at the ensuing Annual General Meeting and being eligible for re-appointment, offers herself for reappointment. The information as required to be disclosed under Regulation 36 of the Listing Regulations will be provided in the notice of ensuing Annual General Meeting.
c. Independent Directors
The Company has received declarations/ confirmations from each Independent Directors under section 149(7) of the Companies Act, 2013 and regulation 25(8) of the Listing Regulations confirming that they meet the criteria of independence as laid down in the Companies Act, 2013 and the Listing Regulations.
The Company has also received requisite declarations from Independent Directors of the Company as prescribed under rule 6(3) of Companies (Appointment and Qualification of Directors) Rules, 2014.
All Independent Directors have affirmed compliance to the Code of Conduct for Independent Directors as prescribed in Schedule IV to the Companies Act, 2013.
In the opinion of the Board, Independent Directors of the Company possess requisite qualifications, experience and expertise and hold highest standards of integrity. Further, 3(Three) independent directors of the Company were in process of inclusion of their name in Data Bank of Independent Directors and one independent director have registered his names in the online databank of Independent Directors.
10. NUMBER OF MEETINGS OF BOARD OF DIRECTORS
The Board meets at regular intervals to discuss and decide on Company/business policies and strategies apart from other Board businesses. The Board/Committee Meetings are prescheduled, and a tentative annual calendar of the Board and Committee Meetings is circulated to the Directors in advance to facilitate them to plan their schedule and to ensure meaningful participation in the meetings.
The Board of Directors of your Company met 4 (Four) Times during the year to carry the various matters.
The maximum interval between any two consecutive Board Meetings did not exceed the period prescribed under the Companies Act, 2013, the Listing Regulation and circular issued by MCA in this regard.
The Composition of Audit Committee are as under:
Further, during the year, there are no such cases where the recommendation of any Committee of Board, have not been accepted by the Board.
11. DIRECTORS? RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134 (3) (c) of the Companies Act, 2013, the Directors hereby confirm and state that:
(a) in the preparation of the annual accounts for the financial year ended March 31, 2023, the applicable accounting standards have been followed and that no material departures have been made from the same;
(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 safeguarding 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 were operating effectively; and
(f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
12. POLICY ON DIRECTORS? APPOINTMENT AND REMUNERATION
The Nomination and Remuneration Committee (‘NRC?) works with the Board to determine the appropriate characteristics, skills and experience for the Board as a whole as well as for its individual members with the objective of having a Board with diverse backgrounds and experience in business, government, education and public service. Characteristics expected of all Directors include independence, integrity, high personal and professional ethics, sound business judgement, ability to participate constructively in deliberations and willingness to exercise authority in a collective manner. The Company has in place a Policy on appointment & removal of Directors (‘Policy?).
The salient features of the Policy are:
• It acts as a guideline for matters relating to appointment and re-appointment of Directors.
• It contains guidelines for determining qualifications, positive attributes for Directors and independence of a Director.
• It lays down the criteria for Board Membership
• It sets out the approach of the Company on board diversity
• It lays down the criteria for determining independence of a Director, in case of appointment of an Independent Director.
The Nomination and Remuneration Policy is posted on website of the Company and may be viewed at http://www.gaekwarmills.in
13. PERFORMANCE EVALUATION OF THE BOARD
The Board evaluation framework has been designed in compliance with the requirements under the Companies Act, 2013 and the Listing Regulations, and in accordance with the Guidance Note on Board Evaluation issued by SEBI on January 05, 2017. The Board evaluation was conducted through questionnaire designed with qualitative parameters and feedback based on ratings.
The Nomination and Remuneration Committee of the Company has laid down the criteria for performance evaluation of the Board, its Committees and individual directors including Independent Directors covering various aspects of the Board?s functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance.
Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 of the Listing Regulations, based on the predetermined templates designed as a tool to facilitate evaluation process, the Board has carried out the annual performance evaluation of its own performance, the Individual Directors including Independent Directors and its Committees on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interest of the Company and its minority shareholders etc.
14. CORPORATE SOCIAL RESPONSIBILITY(CSR)
Your company does not fall in the ambit of limit as specified in Section 135 of the Companies Act, 2013 read with Rule framed there under in respect of Corporate Social Responsibility. However, the directors of the Company, in their personnel capacity, are engaged in philanthropy activities and participating for cause of upliftment of the society.
15. MANAGEMENT DISCUSSION & ANALYSIS REPORT
The Management Discussion and Analysis Report for the year under review as stipulated under Regulation 34(2)(e) of the Listing Regulations is presented in a separate section and forming part of this Report.
16. CORPORATE GOVERNANCE
As your Company?s Paid up Equity Share Capital and Net Worth not exceeding Rs.10 Crores and Rs.25 Crores respectively, there corporate governance provision as specified in regulations 17, 17A, 18, 19, 20, 21,22, 23, 24, 24A, 25, 26, 27 and clauses
(b) to (i) and (t) of sub-regulation (2) of regulation 46 and para C , D and E of Schedule V shall not apply to the Company.
17. VIGIL MECHANISM / WHISTLE BLOWER POLICY
Your Company has in place Whistle Blower Policy ("the Policy"), to provide a formal mechanism to its directors and employees for communicating instances of breach of any statute, actual or suspected fraud on the accounting policies and procedures adopted for any area or item, acts resulting in financial loss or loss of reputation, leakage of information in the nature of Unpublished Price Sensitive Information (UPSI), misuse of office, suspected/actual fraud and criminal offences. The Policy provides for a mechanism to report such concerns to the Chairman of the Audit Committee through specified channels. The frame work of the Policy strives to foster responsible and secure whistle blowing. In terms of the Policy of the Company, no employee including directors of the Company has been denied access to the chairman of Audit Committee of the Board. During the year under review, no concern from any whistle blower has been received by the Company. The whistle blower policy is available at the link http://www.gaekwarmills.in
18. STATEMENT ON RISK MANAGEMENT POLICY
Risk assessment and management are critical to ensure long-term sustainability of the business. The Company has in place, a strong risk management framework with regular appraisal by the top management. The Board of Directors reviews the Company?s business risks and formulates strategies to mitigate those risks. The Senior Management team, led by the Whole Time Director, is responsible to proactively manage risks with appropriate mitigation measures and implementation thereof.
19. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
During the year, the Company has not made investment in security of body corporate and however given loan to Private Limited Company, the details of the same is given in note no.4, 6 and related party notes of the Financial Statement. Further, the Company has not given any guarantees or provided security in connection with a loan to any other body corporate or person.
20. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All the transactions with related parties are in the ordinary course of business and on arm?s length basis and there are no ‘material? contracts or arrangement or transactions with related parties and thus disclosure in Form AOC-2 [Pursuant to clause (h) of subsection (3) of Section 134 of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014] is not required.
The statement showing the disclosure of transactions with related parties in compliance with applicable provisions of Ind AS, the details of the same are provided in Note No. 21 of the Standalone Financial Statement. All related party transactions were placed before the Audit Committee and the Board, wherever applicable for their approval.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board is available at https://www.gaekwarmills.in
21. INTERNAL FINANCIAL CONTROL SYSTEM
The Company has in place adequate standards, processes and structures to implement internal financial controls with reference to financial statements. Internal control systems comprising of policies and procedures are designed to ensure sound management of your Company?s operations, safekeeping of its assets, optimal utilizations of resources, reliability of its financial information and compliance.
Systems and procedures are periodically reviewed to keep pace with the growing size and complexity of your company?s operation.
22. LISTING REGULATIONS, 2015
The Equity Shares of the Company are listed on BSE Limited (BSE). The Company has paid its Annual Listing Fees to the stock exchanges for the Financial Year 2023-2024.
The Company has formulated following Policies as required under the Listing Regulations, the details of which are as under:
1. "Documents Preservation & Archival Policy" as per Regulation 9 and Regulation 30 which may be viewed at https://www.gaekwarmill.in
2. "Policy for determining Materiality of events/information" as per Regulation 30 which may be viewed at https://www.gaekwarmill.in
Further, during the year under review, the Board of Directors at their meeting held on February 14, 2024 appointed M/s. Bigshare Services Private Limited as the new Registrar and Share Transfer Agent (RTA) of the Company and initialled the process of change of RTA
23. AUDITORS
(a) Statutory Auditor
M/s. M.D. Pandya & Associates, Chartered Accountants (Firm Registration No. 107325W) has been appointed as Statutory Auditors of the Company for a period of 5 Years from the conclusion of 93rd Annual General Meeting till the conclusion of 98th Annual General Meeting of the Company. Your Company has received necessary confirmation from them stating that they satisfy the criteria provided under section 141 of the Companies Act, 2013.
The report of the Statutory Auditor forms part of the Annual Report. The said report does not contain any qualification, reservation, adverse remark or disclaimer
(b) Secretarial Auditor
Pursuant to provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed Mr. Anish Gupta, M/s VKMG & Associates LLP, Practicing Company Secretaries, as the Secretarial Auditors of the Company to undertake Secretarial Audit for the financial year ended March 31,2024. The Secretarial Audit Report for the financial year ended March 31, 2024 is annexed herewith and marked as ‘Annexure-1? to this Report.
SECRETARIAL AUDITOR?S OBSERVATIONS & COMMENTS FROM BOARDS: -
(a) The Company has not updated its website and uploaded the documents and information as required under provisions of the Companies Act 2013 Regulation 46 of SEBI (LODR) Regulations 2015.
Comments by the Board: - The Directors have taken the note of the same and will do the compliance at the earliest.
(b) The Company has not filed e-Form DPT-3 in respect of Particulars of transactions by a company not considered as deposit as per rule 2(1)(c) of the Companies (Acceptance of Deposit) Rules, 2014 for the year ended March 31, 2023, as required under rule 16 of Companies (Acceptance of Deposits) Rules, 2014.
Comments by the Board:- The Company has already filed DPT-3 for the year ended 31st March, 2023 with late filing fees.
(c) The Company appointed Mr. Girish Shah, Mr. Ratan Karanjia and Mr. Mipan Shah as an Independent Directors under section 149 of the Companies Act, 2013 however, directors have not registered their names as per The Companies (Creation and Maintenance of databank of Independent Directors) Rules, 2019 and also not appeared for Online Proficiency Test.
Comments by the Board:- The Independent Directors of the Company possess requisite qualifications, experience and expertise and hold highest integrity. However, Mr. Mipan Shah is in process of inclusion of his name in Data Bank of Independent Directors and Mr. Ratan Karanjia and Mr. Girish Shah has tendered their resignations w.e.f. 29th May, 2024.
(d) The Company has not filed e-Form MGT-14, to grant loans or give guarantee or provide security in respect of loans as required under Section 117 read with 179(3) of the Companies Act, 2013.
Comments by the Board:- The Company will ensure its compliances.
(e) There was a delay in publication of financial result in newspapers and subsequently delay in submission with stock exchange for the quarter ended June, 2023 and September 2023.
24. REPORTING OF FRAUDS BY AUDITORS
During the year under review, the Auditors of the Company have not reported to the Audit Committee, under section 143(12) of the Companies Act, 2013, any instances of fraud committed against the Company by its Officers or Employees, the details of which would need to be mentioned in the Board's Report.
25. MATERIAL CHANGES AND COMMITMENTS
There were no material changes and commitments, affecting the financial position of the Company, which has occurred between the end of the financial year of the Company, i.e. March 31, 2024 till the date of this Directors? Report.
26. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS
There were no other significant and material orders passed by the regulators/ courts/ tribunals, which may impact the going concern status and the Company?s operations in future.
27. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
(a) The ratio of the remuneration of each Director to the median employee?s remuneration and other details in terms of sub-section 12 of Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are as under:
1. the Ratio of the Remuneration of each Director to the median employee?s remuneration, the percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year
During the year 2023-2024, the Company has only paid remuneration to Ms. Nidhi Vinodkumar Darak, the Company Secretary of the Company of an amount of Rs.1.8 lakhs and not paid any remuneration to its Directors CFO, and other employees of the Company. Ms. Nidhi Vinodkumar Darak appointed w.e.f 1st November, 2021, hence percentage increase in remuneration is not comparable.
2. The percentage increase in the median remuneration of employees in the financial year and number of permanent employees on the rolls of the Company.
The Company has only paid remuneration to the Company Secretary of the Company and justification for percentage increase in salary already provided in point no. 1 above. The Number of permanent employees on the rolls of the Company as on 31st March 2024 is 1(one).
3. Average percentile increase 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:
The Company has not paid any managerial remuneration and only paid salary to Company Secretary of the Company, therefore average percentile increase could not be provided.
4. Affirmation that the remuneration is as per the remuneration policy of the Company:
The Company has only paid remuneration to Company Secretary of the Company as per the NRC policy of the Company.
(b) In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the requisite details are as under:
The Company has only paid remuneration to its Company Secretary, the disclosure of the same areas under:
28. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
The Company does not have any unpaid/unclaimed amount which is required to be transferred, under the provisions of Companies Act, 2013 into the Investor Education and Protection Fund (IEPF) of the Government of India.
29. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION
The disclosures to be made under Section 134 (3) (m) of the Companies Act, 2013 read with Rule 8 (3) of the Companies (Accounts) Rules, 2014 by the Company are as under:
(A) Conservation of Energy
(i) The steps taken or impact on conservation of energy:
Though business operation of the Company is not energy-intensive, the Company, being a responsible corporate citizen, makes conscious efforts to reduce its energy consumption. The Company has not carried our any business activities during the year.
(ii) Steps taken by the Company for utilizing alternate source of energy.
Apart from above no other steps were taken as the Company has not carried our any business activities during the year.
(iii) The capital investment on energy conservation equipment:
There is no capital investment on energy conservation equipment during the year under review.
(B) Technology Absorption
The Company has not imported any technology during last three years from the beginning of the financial year. The Company has not incurred any expenditure on Research and Development during the year under review.
(C) Foreign Exchange Earnings and Outgo
There were neither earnings nor outgo in foreign exchange during the year under consideration.
30. ANNUAL RETURN
Pursuant to sub-section 3(a) of Section 134 and sub-section (3) of Section 92 of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the copy of Annual Return of the Company as on March 31, 2024 is available on the Company?s website and can be accessed at https://www.gaekwarmills.in.
31. SECRETARIAL STAN DARD OF ICSI
The Company has complied with the Secretarial Standards on Meeting of the Board of Directors (SS-1) and General Meetings (SS-2) specified by the Institute of Company Secretaries of India (ICSI).
32. MAINTENANCE OF COST RECORDS
Maintenance of cost records as prescribed by the Central Government under subsection (1) of Section 148 of the Companies Act 2013 is not applicable to the Company.
33. PREVENTION OF SEXUAL HARASSMENT
Your Company is fully committed to uphold and maintain the dignity of women working in the Company and has zero tolerance towards any actions which may fall under the ambit of sexual harassment at workplace. Since, the Company has less than Ten Employees constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 is not applicable. Further, during the year the Company has not received any case related to sexual harassment.
The policy framed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 read with Rules framed thereunder may be viewed at https://www.gaekwarmills.in.
34. GENERAL DISCLOSURES
The Company has been engaged in the business of manufacturing Fabrics (Textile Industry), however the said unit was declared sick and to set up fresh unit, clear all liabilities and pursuant to a Scheme u/s 391 of Companies Act, 1956 sanctioned by Bombay High Court, Company at present is into development of 60% of its own land at Bilimora.
Your directors state that no disclosure or reporting is required in respect of the following matters as there were no transactions on these matters during the year under review:
- Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.
- Issue of shares under ESOP scheme
- Scheme of provision of money for the purchase of its own shares by employees or by trustees for the benefit of employees.
- Instance of one-time settlement with any Bank or Financial Institution.
- Application or proceedings under the Insolvency and Bankruptcy Code, 2016
35. ACKNOWLEDGEMENTS
Your Directors take the opportunity to express our deep sense of gratitude to all users, vendors, government and non-governmental agencies and bankers for their continued support in Company?s growth and look forward to their continued support in the future.
Your Directors would also like to express their gratitude to the shareholders for reposing unstinted trust and confidence in the management of the Company.