26 Apr 2017 | Livemint.com

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Dhanuka Agritech Ltd.

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  • BSE Code: 507717
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  • NSE Code: DHANUKA
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Dhanuka Agritech Ltd. Accounting Policy

Report on Corporate Governance

Dhanuka's philosophy on Corporate Governance is embedded in the rich legacy of ethical governance practices, committed to value creation by taking principled business decisions. Good Corporate Governance results in enhancement of Shareholder's value and enables the Company to meet its obligations towards all stakeholders with integrity, equity, transparency, fairness, disclosure, accountability and commitment.

This includes its Corporate Structure, Culture, Policies and the manner in which it deals with various stakeholders. At Dhanuka, it is imperative that our Corporate Affairs are managed in a fair and transparent manner which in turn brings trust, faith and belief in the system. Therefore, timely and accurate disclosure of information regarding the financial situation, performance, ownership and governance of the Company is an important part of our Corporate Governance.

(1) Company's Philosophy On Corporate Governance

Your Company believes in adopting the 'best practices' that are followed in the area of Corporate Governance across the Industry to ensure fiscal accountability and ethical corporate behavior, in addition to meeting the legal requirements. At Dhanuka, the Board is at the core of our Corporate Governance Practice and considers itself as a Trustee of its Shareholders and acknowledges its responsibilities towards them for creating and safeguarding their wealth. The philosophy of the Company in relation to Corporate Governance is to ensure transparency and accountability in all its operations, make appropriate disclosures and simultaneously, enhance Shareholders' value without compromising, in any way, compliance with laws and regulations.

Your Company is in compliance with the requirements of the revised guidelines on Corporate Governance stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

(2) The Board of Directors

The Board has an appropriate mix of Executive and Non  Executive Directors. There is also one Woman Director on the Board. The strength of the Board was Thirteen, represented by Six Executive and seven Non-Executive Directors as on 31st March, 2016. The Company has an Executive Chairman.

More than Fifty percent of the Board is Independent, i.e. there are Seven Independent Directors on the Board. The size and composition of the Board conforms to the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Companies Act, 2013 ("Act").

Independent Directors are non-executive Directors. The qualifications, appointment, maximum tenure of the Independent Directors comply with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. All the Independent Directors of the Company have confirmed that they meet the criteria as mentioned under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Section 149 of the Companies Act, 2013.

Terms and conditions of appointment of the Independent Directors are disclosed on the website of the Company.

Directorships:

In compliance with the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, none of the Directors on Company's Board is a Director in more than 10 Public Limited Companies (including Dhanuka Agritech Limited) or is a Member of more than 10 Board Committees (Committees being Audit Committee and Stakeholders' Relationship Committee) or Chairman of more than 5 Board Committees as on 31stMarch, 2016.

Necessary disclosures regarding the Committee position in Dhanuka Agritech Limited and other Public Companies as on 31st March, 2016 have been made by all the Directors. Other Directorships do not include Directorships of Private Limited Companies, LLP and Companies incorporated under Section 8 of the Companies Act, 2013.

*Kapil Garg was appointed as Company Secretary and Additional / Executive Director w.e.f. 09.02.2016.

The details of Chairmanship and Membership of the Directors in the Audit Committee and Stakeholder Relationship Committee are given.

Necessary Quorum was present in all the Meetings.

All the Directors have informed the Company about any changes in their Directorship or Committee Membership and the same is disclosed to the Board in the next Meeting.

Board Procedure and Functioning:

The Board meets at least once every quarter to review the

Quarterly Results and to take decisions on matters pertaining to Company's working. Whenever necessary, additional Meetings are held. In case of business exigencies, Resolutions are passed by circulation.

All Board/Committee Members are given advance Notice of the Meetings in compliance with the Companies Act, 2013. The Meetings are governed by structured Agenda. The Agenda along with the explanatory notes is also circulated in advance as per the provisions of the Act. The Board/Committee Members have access to Company's information. The following information as stated in Regulation 17 (7) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is provided to the Directors:

Annual operating plans and budgets and any updates. Capital Budgets and any updates.

Quarterly, Half Yearly and Annual Financial Results, Analysis of Financial Data and its operating divisions or business segments.

The information on recruitment and remuneration of Senior Officers just below the Board level, including appointment or removal of Chief Financial Officer and the Company Secretary.

Show cause, demand, prosecution notices and penalty notices which are materially important, if any.

Fatal or serious accidents, dangerous occurrences, any material effluent or pollution problems, if any.

Any issue, which involves possible public or product liability claims of substantial nature, including any judgment or order which, may have passed strictures on the conduct of the Company or taken an adverse view regarding another enterprise that can have negative implications on the Company, if any.

Details of important Joint Venture or Collaboration Agreement, if any.

Transactions that involve substantial payment towards goodwill, brand equity, or intellectual property, if any.

Signifcant labour problems and their proposed solutions. Any signifcant development in Human Resources / Industrial Relations front like signing of wage agreement, implementation of Voluntary Retirement Scheme etc, if any.

Sale of material nature, of investments, subsidiaries, assets, which is not in normal course of business.

Quarterly details of Foreign Exchange Exposures and the steps taken by management to limit the risks of adverse exchange rate movement, if material.

Minutes of the Annual General Meetings/Extraordinary General Meetings/Board Meetings/Meetings of all Committees of the Board.

Statutory Compliance Report of the laws applicable to the Company, as well as steps taken by the Company to rectify instances of non-compliances, if any.

Minutes of the Board Meetings, Annual General Meetings of Subsidiary Company and significant transactions, if any.

Notice of Interest of Directors and Related Party Transactions.

• Any material default in the financial obligations to or by the Company or substantial non-payment for goods sold to or by the Company.

• Risk Identification and Mitigation measures including Foreign Exchange exposure.

• Non-compliance of any regulatory, statutory, listing requirements or Shareholders' services such as non-payment of Dividend, delay in share transfer, etc.

Independent Directors are regularly updated on performance of each product segment of the Company, business strategy and new initiatives being taken/ proposed to be taken by the Company.

We have created more opportunities to update the members of the Board through discussion of strategic issues, both formally and informally.

The Board has laid down a Code of Conduct for all the Board Members and Senior Management of the Company. The Code of Conduct is available on Company's website www.dhanuka.com All the Members of the Board and the Senior Management personnel of Company have confirmed their compliance with the Code of Conduct during the Financial Year ended 31st March, 2016.

Directors' Responsibilities:

Responsibilities of the Board of Directors:

The primary responsibilities of the Board of Directors are summarized hereunder:-

(i) Disclosure of information:

(1) Members of Board of Directors and Key Managerial Personnel disclose to the Board of Directors whether they, directly, indirectly, or on behalf of third parties, have a material interest in any transaction or matter directly affecting the listed entity.

(2) The Board of Directors and Senior Management conduct themselves so as to meet the expectations of operational transparency to stakeholders while at the same time maintaining confidentiality of information in order to foster a culture of good decision-making.

(ii) Key functions of the Board of Directors-

(1) Reviewing and guiding corporate strategy, major plans of action, risk policy, annual budgets and business plans, setting performance objectives, monitoring implementation and corporate performance, and overseeing major capital expenditures, acquisitions and divestments.

(2) Monitoring the effectiveness of the Company's governance practices and making changes as needed.

(3) Selecting, compensating, monitoring and, when necessary, replacing Key Managerial Personnel and overseeing succession planning.

(4) Aligning Key Managerial Personnel and remuneration of Board of Directors with the longer term interests of the listed entity and its Shareholders.

(5) Ensuring a transparent nomination process to the Board of Directors with the diversity of thought, experience, knowledge, perspective and gender in the Board of Directors.

6) Monitoring and managing potential conflicts of interest of management, members of the Board of Directors and Shareholders, including misuse of corporate assets and abuse in related party transactions.

(7) Ensuring the integrity of the listed entity's accounting and financial reporting systems, including the independent audit, and that appropriate systems of control are in place, in particular, systems for risk management, fnancial and operational control, and compliance with the law and relevant standards.

(8) Overseeing the process of disclosure & communications.

(9) Monitoring and reviewing Board of Director's evaluation framework.

Board Meetings held during Financial Year 2015-16:

During the year, Six Board Meetings were held and the time gap between any of the two Meetings was not more than one hundred and twenty days. The Board Meetings were held on 28.05.2015, 12.08.2015, 05.11.2015, 02.12.2015, 09.02.2016 & 17.03.2016.

Facility of Video conferencing had been offered to the Directors to participate in the Meetings.

During the year, a separate Meeting of the Independent Directors was held on 9th day of February, 2016 to review the performance of the Directors and the Board as a whole.

Re-appointment of Directors retiring by rotation:

The following are the Directors who are retiring by rotation and are eligible for re-appointment at the forthcoming AGM:

1. Mr. M.K. Dhanuka

2. Mr. Arun Kumar Dhanuka

Their brief resume, nature of their expertise in specifc functional areas, their Directorships and their Membership of the Board Committees are mentioned in explanatory statement to Notice of Annual General Meeting.

(3) Board Committees

The Board Committees play a crucial role in the Governance structure of the Company and have been assigned specific areas /activities which need closer review. They are set up under the formal approval of the Board, to carry out their clearly defined roles. The Board delegates them the necessary powers and supervises their working.

Currently, the Board has following committees:

A. Audit Committee

B. Nomination and Remuneration Committee

C. Stakeholders' Relationship Committee

D. Banking, Finance and Operations Committee

E. Corporate Social Responsibility Committee

. Audit Committee

The Audit Committee of the Company is constituted in line with the Regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Section 177 of the Companies Act, 2013 and the Rules notified by the Central Government in this regard. The Board decides the Membership and terms of reference of the Audit Committee. The present Audit Committee has four Directors. All the Members of the Audit Committee are financially literate and Mr. Priya Brat, Chairman of the Committee, has expertise in finance.

The Managing Director, Mr. Mahendra Kumar Dhanuka is a Permanent Invitee of the Audit Committee since 18thMay, 2013.

During the Financial Year 2015-16, Five Audit Committee Meetings were held on 28.05.2015, 12.08.2015, 05.11.2015, 02.12.2015 & 09.02.2016. The gap between two Meetings did not exceed four months. The necessary quorum was present for all the Meetings. The Chairman of the Audit Committee, Mr. Priya Brat was present at the last Annual General Meeting of the Company. The Statutory Auditors, Internal Auditors, Chief Financial Offcer are invited to attend the Audit Committee Meetings and the Company Secretary acts as the Secretary of the Committee.

Terms of Reference:

(1) 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;

(2) Recommendation for appointment, remuneration and terms of appointment of Auditors of the listed entity;

(3) Approval of payment to Statutory Auditors for any other services rendered by the Statutory Auditors;

(4) Reviewing, with the management, the annual financial statements and auditor's report thereon before submission to the board for approval, with particular reference to:

(a) Matters required to be included in the Director's Responsibility Statement to be included in the Board's Report in terms of Clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013;

(b) Changes, if any, in accounting policies and practices and reasons for the same;

(c) Major accounting entries involving estimates based on the exercise of judgment by management;

(d) Significant adjustments made in the financial statements arising out of audit fndings;

(e) Compliance with listing and other legal requirements relating to financial statements;

(f) Disclosure of any related party transactions;

(g) Modified opinion(s) in the draft audit report;

(5) Review with the management, the quarterly financial statements before submission to the board for approval;

(6) Review with the management, the statement of uses/application of funds raised through an issue (public issue, rights issue, preferential issue, etc.), the statement of funds utilized for purposes other than those stated in the offer document/prospectus/notice and the report submitted by the monitoring agency monitoring the utilization of proceeds of a public or rights issue, and making appropriate recommendations to the board to take up steps in this matter;

(7) Review and monitoring the auditor's independence and performance, and effectiveness of audit process;

(8) Approval or any subsequent modification of transactions of the listed entity with related parties;

(9) Scrutiny of inter-corporate loans and investments;

(10) Valuation of undertakings or assets of the listed entity, wherever it is necessary;

(11) Evaluation of internal financial controls and risk management systems;

(12) Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems;

(13) 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;

(14) Discussion with internal auditors of any significant findings and follow up there on;

(15) 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;

(16) Discussion with Statutory Auditors before the audit

. Audit Committee

The Audit Committee of the Company is constituted in line with the Regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Section 177 of the Companies Act, 2013 and the Rules notified by the Central Government in this regard. The Board decides the Membership and terms of reference of the Audit Committee. The present Audit Committee has four Directors. All the Members of the Audit Committee are financially literate and Mr. Priya Brat, Chairman of the Committee, has expertise in finance.

The Managing Director, Mr. Mahendra Kumar Dhanuka is a Permanent Invitee of the Audit Committee since 18thMay, 2013.

During the Financial Year 2015-16, Five Audit Committee Meetings were held on 28.05.2015, 12.08.2015, 05.11.2015, 02.12.2015 & 09.02.2016. The gap between two Meetings did not exceed four months. The necessary quorum was present for all the Meetings. The Chairman of the Audit Committee, Mr. Priya Brat was present at the last Annual General Meeting of the Company. The Statutory Auditors, Internal Auditors, Chief Financial Officer are invited to attend the Audit Committee Meetings and the Company Secretary acts as the Secretary of the Committee.

Terms of Reference:

(1) 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;

(2) Recommendation for appointment, remuneration and terms of appointment of Auditors of the listed entity;

(3) Approval of payment to Statutory Auditors for any other services rendered by the Statutory Auditors;

(4) Reviewing, with the management, the annual financial statements and auditor's report thereon before submission to the board for approval, with particular reference to:

(a) Matters required to be included in the Director's Responsibility Statement to be included in the Board's Report in terms of Clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013;

(b) Changes, if any, in accounting policies and practices and reasons for the same;

(c) Major accounting entries involving estimates based on the exercise of judgment by management;

(d) Significant adjustments made in the financial statements arising out of audit fndings;

(e) Compliance with listing and other legal requirements relating to financial statements;

(f) Disclosure of any related party transactions;

(g) Modified opinion(s) in the draft audit report;

(5) Review with the management, the quarterly financial statements before submission to the board for approval;

(6) Review with the management, the statement of uses/application of funds raised through an issue (public issue, rights issue, preferential issue, etc.), the statement of funds utilized for purposes other than those stated in the offer document/prospectus/notice and the report submitted by the monitoring agency monitoring the utilization of proceeds of a public or rights issue, and making appropriate recommendations to the board to take up steps in this matter;

(7) Review and monitoring the auditor's independence and performance, and effectiveness of audit process;

(8) Approval or any subsequent modification of transactions of the listed entity with related parties;

(9) Scrutiny of inter-corporate loans and investments;

(10) Valuation of undertakings or assets of the listed entity, wherever it is necessary;

(11) Evaluation of internal financial controls and risk management systems;

(12) Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems;

(13) 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;

(14) Discussion with internal auditors of any significant findings and follow up there on;

(15) 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;

(16) 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;

(17) To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors;

(18) To review the functioning of the Whistle Blower Mechanism;

(19) Approval of appointment of Chief Financial Offcer after assessing the qualifications, experience and background, etc. of the candidate;

(20) Carrying out any other function as is mentioned in the terms of reference of the audit committee.

B. Nomination and Remuneration Committee:

The Nomination and Remuneration of the Directors, their relatives and Key Managerial Personnel, if any, are recommended by the Nomination and Remuneration Committee which comprises of Independent Directors, in terms of Schedule V of the Companies Act, 2013 and Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The recommendations of the Nomination and Remuneration Committee are submitted to the Board for its approval, subject to the consent of the Shareholders, wherever necessary.

During the Financial Year 2015-16, Two Nomination and Remuneration Committee Meetings were held on 28.05.2015 & 09.02.2016. The necessary quorum was present at the Meeting.

Terms of Reference:

The Nomination and Remuneration Committee:

a. Identify 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 their appointment and removal and shall carry out evaluation of every Director's performance. The Company shall disclose the Remuneration Policy and the evaluation criteria in its Annual Report;

b. To formulate the criteria for determining qualifications, positive attributes and independence of a Director and recommend to the Board a Policy, relating to the  remuneration for the Directors, Key Managerial Personnel and other employees;

c. Formulation of criteria for performance evaluation of Independent Directors and the Board;

d. To Devise a Policy on Board diversity;

e. Review and reassess the adequacy of this charter periodically and recommend any proposed changes to the Board for approval from time to time;

f. 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;

g. Any other matter, as may be required by the Companies Act, 2013, Companies (Meetings of Board and its Powers) Rules, 2014 and Regulations of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, any other law for the time being in force or as directed by the Board of Directors.

The Executive Directors are not paid any Sitting Fees. The Company pays only sitting fees to Non-Executive/Independent Directors for attending Board/Committee Meetings. The Non-Executive Directors were paid sitting fees of Rs. 20,000/- for each Board Meeting attended and Rs. 10,000/- for each Committee Meeting attended till 29th May, 2015 and thereafter Rs. 30,000/- for each Board Meeting attended and Rs. 10,000/- for each Committee Meeting attended.

None of the Non-Executive Directors hold any Equity Shares of the Company, except Eight Hundred Equity Shares held by Mr. Indresh Narain.

Details of Equity Shares of the Company held by the Directors as on 31stMarch, 2016 are given below:

The Company has not issued any ADR/GDR/Warrants/any kind of convertible Securities or Employee Stock Option Plan.

Remuneration Policy

The objective of the Company's Remuneration Policy is to ensure that all the employees, including Executive Directors and Key Managerial Personnel are sufficiently incentivised for enhanced performance. The Nomination and Remuneration Committee takes into account various factors to determine this Policy and to amend it from time to time. The Policy ensures that due regard is given to the Company's financials and interests of Shareholders. It ensures that levels of remuneration are sufficient to attract and retain exceptional employees who can take the Company forward.

Within the terms of agreed Policy, the Company determines the entire individual remuneration package for all its employees. The Company provides due weightage to the Corporate and individual performance while deciding on the remuneration package of all employees.

Company follows geography wise approach in determining the remuneration of all employees. Due weightage is given to relevant experience, educational and professional qualifications. Both variable and fixed components of the remuneration packages are set as per the market practices followed in India and our industry. Total remuneration will comprise:-

a) Basic Salary to perform day to day operations.

b) Variable pay payable to Sales team on achievement of prescribed growth over the last year's turnover on Specialty and Lifeline products.

c) Sales Incentives payable to Sales team as per the incentive Policy of the Company devised to motivate its sales employees to "Sell More, Earn More".

d) A performance linked incentive for non-sales team based on the corporate performance, departmental achievements and individual contribution.

e) Relevant long term employee benefits - Provident Fund, Gratuity, Superannuation etc. are paid in accordance with the applicable laws.

f) Commissions and Perquisites are provided to Executive Directors and Senior Executives as per the market practices.

g) Business tools like car/driver/laptops/phones, etc. are provided, as per Company Policy.

C. Stakeholders' Relationship Committee:

During the Financial Year 2015-16, Four Stakeholders' Relationship Committee Meetings were held on 28.5.2015, 12.08.2015, 5.11.2015 & 09.02.2016. The necessary quorum was present for all the Meetings.

Terms of Reference:

The Stakeholders' Relationship Committee

a. Shall review for the timely redressed of investors' complaints and to consider measures in the larger interest of investors.

b. Shall review the redressed of requests relating to share transfer, transmission, transposition, issuance of duplicate share certificates etc.

Name, designation and address of Compliance Officer:

Mr.Kapil Garg  Company Secretary & Compliance Officer  Dhanuka Agritech Limited  (CIN:L24219DL1985PLC020126)  14thFloor, Building 5A, DLF Epitome,  DLF Phase III, Cyber City, Gurgaon, Haryana -122002

Number of Shareholders complaints received:

During the Financial Year 2015-16, the Company has received 137 correspondences (including 15 complaints) from its Shareholders and resolved all of them. Further, all the complaints were resolved within the prescribed time and there was no complaint pending as on 31stMarch, 2016.

D. Banking, Finance and Operations Committee:

During the Financial Year 2015-16, Eight Meetings of the Banking, Finance and Operations Committee were held on 2.06.2015, 13.07.2015, 12.08.2015, 14.09.2015, 05.10.2015, 14.12.2015, 09.02.2016 & 17.03.2016. The necessary quorum was present for all the Meetings.

Terms of Reference:

a. To open/close bank accounts, including modifcation of authorities for operating them;

b. To approve all borrowings, including those from banks/financial institutions etc., including availing ad-hoc funds for working capital purpose, accepting sanction of loans and giving security for the same;

c. To invest surplus funds of the Company;

d. To apply for licenses, registrations, etc. to all Central and State Government departments, to deal with and represent the Company before various Regulatory Authorities, to initiate and defend legal proceedings, by/against the Company, to execute Power of Attorney;

e. To approve acceptance of security deposits in the routine course of business of the Company for the performance of contract for supply of goods;

f. To give Bank guarantees;

g. To perform any other activity relating to afore-said matters subject to all applicable laws and shall have the power to delegate such of its functions, from time to time, as may be considered necessary.

E. Corporate Social Responsibility Committee:

Keeping in view the requirements of Section 135 of the Companies Act, 2013, read with Companies (Corporate Social Responsibility Policy) Rules, 2014, the Board has constituted the Corporate Social Responsibility Committee ("CSR Committee") in its Meeting held on 6th February, 2014.

During the Financial Year 2015-16, CSR Committee Meeting was held on 05.11.2015. The necessary quorum was present for the Meeting.

Terms of Reference:

a. Formulate and recommend to the Board, a Corporate Social Responsibility ("CSR") Policy which shall indicate the activities to be undertaken by the Company as specified in Schedule VII of the Companies Act, 2013;

b. Recommend the amount of expenditure to be incurred on CSR activities; and

c. Monitor the CSR Policy of the Company from time-to-time. The Company is involved in various CSR activities.

The objective of CSR Policy is to lay down guidelines to bring effectiveness in its CSR activities which are being undertaken to assist in the Sustainable Development of the Society. The Company strives to actively contribute to the social and economic development of the communities in which it operates. The Company believes in making sustained efforts towards promoting education; eradicating hunger, poverty and mal­nutrition; conservation of water, deployment of water for agriculture and human use.

The thrust is on training and educating farmers and dealers and transfer of technology to improve food production. The Company's CSR efforts have been to conserve "Gaon ka paani, gaon mein aur khet ka paani, khet mein" and will continue its CSR activities in this direction.

The Company undertakes CSR activities that aim at improving the lives of the agricultural and rural community holistically. The Company's CSR Policy is available on the Company's website.

Restructuring Committee

Restructuring Committee was constituted by the Board of Directors in their Meeting held on 6th October, 2014 for operational ease in the matter of Amalgamation of A.M. Bros. Fintrade Private Limited ('AMB') and Dhanuka Finvest Private Limited ('DFPL') with Dhanuka Agritech Limited ('DAL' or 'the Company') and their respective Shareholders and Creditors ('the Scheme').

The aforementioned scheme of amalgamation has been approved by the High Court and the order of the High Court has been filed on 01.12.2015 with the Registrar of Companies. Hence, the Restructuring Committee has been dissolved.

 (5) Role of the Company Secretary:

Mr. Kapil Garg, Company Secretary and Compliance Officer is responsible for following:-

(a) To ensure conformity with the regulatory provisions applicable to the listed entity in letter and spirit.

(b) Co-ordination with and reporting to the Board, recognized stock exchange(s) and depositories with respect to compliance with rules, regulations and other directives of these authorities in manner as specified from time to time.

(c) To ensure that the correct procedures have been followed that would result in the correctness, authenticity and comprehensiveness of the information, statements and reports filed by the listed entity under these regulations.

(d) To Monitor email address of grievance redressal division as designated by the listed entity for the purpose of registering complaints by investors:

The provisions of the Companies Act, 2013, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, various SEBI guidelines including Substantial Acquisition of Shares and Takeovers Regulations, 2011 and (Prohibition of Insider Trading Regulations), 2015 and all other applicable Laws and Regulations in this regard are completely adhered to.

The Secretarial Standards in relation to Board Meeting and Annual General Meeting issued by the ICSI are followed.

(6) Disclosures:

a) Related Party Transactions:

Pursuant to the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, necessary approvals for transactions with Related Parties were obtained from Audit Committee, Board and General body of Members, during the Financial Year 2015-16.

The Board has approved a Policy for Related Party Transactions which has been uploaded on the Company's website at the following link <http://www.dhanuka.com/> compliance-report-on-corporate-governance/.

b) Disclosures on materially significant Related Party Transactions that may have potential conflict with the interest of the Company at large:

The disclosures with regard to transactions with Related Parties are given in the Notes to Accounts of the Audited Financial statements for the Financial Year ended 31st March, 2016. These transactions are not in conflict with the Company's interest.

(5) Role of the Company Secretary:

Mr. Kapil Garg, Company Secretary and Compliance Officer is responsible for following:-

(a) To ensure conformity with the regulatory provisions applicable to the listed entity in letter and spirit.

(b) Co-ordination with and reporting to the Board, recognized stock exchange(s) and depositories with respect to compliance with rules, regulations and other directives of these authorities in manner as specified from time to time.

(c) To ensure that the correct procedures have been followed that would result in the correctness, authenticity and comprehensiveness of the information, statements and reports filed by the listed entity under these regulations.

(d) To Monitor email address of grievance redressal division as designated by the listed entity for the purpose of registering complaints by investors:

The provisions of the Companies Act, 2013, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, various SEBI guidelines including Substantial Acquisition of Shares and Takeovers Regulations, 2011 and (Prohibition of Insider Trading Regulations), 2015 and all other applicable Laws and Regulations in this regard are completely adhered to.

The Secretarial Standards in relation to Board Meeting and Annual General Meeting issued by the ICSI are followed.

(6) Disclosures:

a) Related Party Transactions:

Pursuant to the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, necessary approvals for transactions with Related Parties were obtained from Audit Committee, Board and General body of Members, during the Financial Year 2015-16.

The Board has approved a Policy for Related Party Transactions which has been uploaded on the Company's website at the following link <http://www.dhanuka.com/> compliance-report-on-corporate-governance/.

b) Disclosures on materially signiicant Related Party Transactions that may have potential conflict with the interest of the Company at large:

The disclosures with regard to transactions with Related Parties are given in the Notes to Accounts of the Audited Financial statements for the Financial Year ended 31st March, 2016. These transactions are not in conflict with the Company's interest.

c) Details of non-compliance by the Company, penalties and strictures imposed on the Company by the Stock Exchanges or SEBI or any other Statutory Authority on any matter related to the Capital Markets during the last three years:

The Company has been strictly adhering to the applicable Rules and Regulations made by SEBI. No penalties or strictures were imposed on the Company by the BSE/NSE or SEBI or any Statutory Authority, on any matter related to the capital markets during last three years.

d) Disclosure of Accounting Treatment:

In the preparation of Financial Statements, the Company has followed the Accounting Standards issued by the Institute of Chartered Accountants of India. The significant Accounting Policies, which are consistently applied, have been set out in the Notes to the Accounts of the Audited Financial Statements for the Financial Year ended 31st March, 2016 Regulation 48 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

e) Compliance Certificate

The Compliance Certificate as stipulated in clause Regulation 17(8) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 was placed before the Board along with the Financial Statements for the Financial Year ended 31st March, 2016 and the Board reviewed the same. The said Certificate is annexed to this report.

f) Whistle Blower Policy and affirmation that no personnel has been denied access to Audit Committee:

Your Company has adopted a Whistle Blower Policy as a mechanism for any stake-holder to report concerns about unethical behavior or actual or suspected fraud of all kinds, including alleged fraud by or against the Company, abuse of authority, whether made by a named complainant or anonymously. No person has been denied access to the Chairman of the Audit Committee. The Policy is available on the Company's website.

g) Internal Complaints Committee:

Your Company has constituted an Internal Complaints Committee ("ICC"), in accordance with the provisions of the Sexual H arassm ent of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013. The ICC comprises of Mrs. Shubha Minz (Chairperson), Mr. Rajesh Sahni, Mr. Ankur Dhanuka and Mrs. Seema Salwan. Female employees can report of sexual harassment incidents at workplace and the Committee strives towards unbiased resolution of the same.

The Policy is available on the Company's website. There were no complaints during the Financial Year 2015-16.

h) Details of the familiarization programme of the Independent Directors are available on the website of the Company <http://www.dhanuka.com> /compliance-report-on-corporate-governance/.

(7) Means of Communication:

a) The Quarterly Results of the Company are approved and taken on record by the Board of Directors of the Company within 45 days (for I, II, III quarter)/60 days (for IV quarter) from the end of quarter. The Approved Results are also published within 48 hours in Financial Express i.e. English newspaper and Jansatta i.e. Hindi leading newspaper.

b) The Company publishes the Audited Annual Results within the stipulated period of 60 days from the close of the Financial Year as per the requirement of Listing Agreement.

c) Website: The Company's website provides comprehensive information on Company's profile, its business lines, Management, Corporate Governance, news releases. An exclusive section is dedicated to Investors consolidated information on the Quarterly, Half Yearly, Annual Financial Statements and Shareholding patterns in downloadable format, as a measure of added convenience to the investors. It provides all the information as prescribed under Regulation 46 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

d) Annual Report: Annual Report containing, inter alia, Audited Annual Accounts, Consolidated & Standalone Financial Statements, Directors' Report, Cash Flow Statement, Auditor's Report and other important information is circulated to Members and others entitled thereto. In accordance with the Green initiatives of the MCA, the Annual Report is e-mailed to those Shareholders who hold Shares in dematerialized form and whose e-mail id is registered with the Depository Participants. Hard copies are sent to the rest of the Shareholders. The Annual Report of the Company is also available on the Company's website in a user-friendly and downloadable form.

e) The Quarterly Unaudited Financial Results as well as Annual Audited Financial Results are promptly communicated to BSE and NSE where the Company's Shares are listed.

f) Management Discussion and Analysis (MDA) Report: The  Report on MDA forms part of the Annual Report.

g) Intimation to the Stock Exchanges: The Company intimates the Stock Exchanges all price sensitive information and material events, in accordance with its Materiality Policy on disclosure of Material Events.

The objective of the Materiality Policy is to ensure timely and adequate disclosure of material events and price sensitive information under Regulations (30) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 by the Company. All such disclosures are signed by the Chairman or Managing Director or Company Secretary. This information is also posted on the website of the Company.

h) Code for Prevention of Insider Trading: The Company has comprehensive guidelines on Prevention of Insider Trading in line with the SEBI (Prohibition of Insider Trading) Regulations, 2015.

The Company has implemented a Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information for Prevention of Insider Trading, referred to as the "Fair Disclosure Code".

The Trading Window is closed prior to the Board Meeting at which Unpublished Price Sensitive Information is discussed and re-opens after the public announcement of this information by the Company, in accordance with the Code. The Company observes a Silent period when the Trading Window is closed.

The procedure for dissemination of Unpublished Price Sensitive Information is complied with by the Chief Investors Relations Offcer and Authorized Spokespersons, as stated in the Fair Disclosure Code.

The Company has also implemented Code of Conduct to regulate, monitor and report trading by Insiders, referred to as the "Insider Trading Code". This Code is applicable to all the Insiders of the Company for Trading in Company's securities.

The disclosures, reporting requirements, restrictions on communication of Unpublished Price Sensitive Information are scrupulously followed.

I) Public Announcements made by the Company from time to time are also displayed on the Company's website. Corporate Presentations made to the Institutional Investors and analysts after the declaration of the quarterly, half-yearly and annual results are also displayed on the Company's website.

(1) GENERAL SHAREHOLDER INFORMATION:

a) 31st Annual General Meeting for the Financial Year ended 31stMarch, 2016

Day & Date: Thursday, 11th August, 2016

Time: 11:00 A.M.

Venue: Shri Purushottam Hindi Bhawan, 11, Vishnu Digambar Marg (Rouse Avenue), New Delhi- 110002

b) Date of Book Closure: 10th August 2016 to 11th August 2016

BSE Limited Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai-400 001.

Scrip Code: 507717

National Stock Exchange of India Ltd. Exchange Plaza, Plot no. C/1, G Block, Bandra-Kurla Complex, Bandra (E), Mumbai - 400 051.

Scrip Code: Dhanuka

Annual listing fees for the Financial Year 2016-17 have been paid to the above Stock Exchanges.

e) Financial Calendar

Financial reporting for the ?rst quarter ending on 30 June, 2016 Within 45 days of the end of the quarter

 Financial reporting for the second quarter ending on 30 September, 2016 Within 45 days of the end of the quarter

 Financial reporting for the third quarter ending on 31 December, 2016 Within 45 days of the end of the quarter

 Financial reporting for the Financial Year ending on 31 March, 2017 Within 60 days of the end of the Financial Year

 Annual General Meeting for the Financial Year ending on 31 March, 2016 Within 6 months of the end of the Financial Year

Share Transfer System:

Abhipra Capital Limited is the Registrar and Transfer Agent (RTA) of the Company and carries out the process of share transfers and transmissions. Stakeholders' Relationship Committee takes note of the transfers and transmissions executed by RTA on quarterly basis. Shares are also received by the RTA for dematerialization from the Shareholders. Such Shares are dematerialized by RTA within stipulated time and a monthly Demat Statement is sent to the Company.

Investor's Correspondence:

All enquiries relating to share transfer/transmission, change of address, loss of share certificate etc. should be addressed to the RTA- M/s. Abhipra Capital Limited.

The queries relating to non receipt of Dividend and Annual Reports should be addressed to the Company Secretary at the Corporate Office of the Company or e-mailed to investors@dhanuka.com

Registrar and Transfer Agents:

M/s. Abhipra Capital Limited,  Ground Floor, Abhipra Complex, Dilkhush Industrial Area, A-387, G.T.Karnal Road, Azadpur, Delhi- 110033, India Phone Nos: (91) (011) 27127362, 27249773/4, 42390708, 42390783 Website: www.abhipra.com E-mail: info@abhipra.com, rta@abhipra.com

i) Plant Locations:

1. Dualatabad Road, Gurgaon, Haryana.

2. Ajanta Industrial Estate, Vasna lyava, Sanand, District, Ahmedabad, Gujarat.

3. SIICOP Industrial Estate, Battal Ballian, Udhampur (J&k)

4. Keshwana Insdustrial Area, Kotputli, Jaipur, Rajasthan.

j) Dematerialization of Shares and Liquidity:

In compliance with the SEBI Circular dated 30th September, 2011, 100% of the Company's Promoters and Promoter - Group Shareholding is in demat mode. As on 31st March, 2016, 4,92,23,918 Equity Shares of the Company were held in dematerialized form. The Equity Shares of the Company are actively traded on the BSE Ltd. and National Stock Exchange of India Limited in demat form. All the requests for nomination, change of address, change of Bank mandate / Bank particulars and rematerialisation of Shares etc. are to be made only to the Depository Participant with whom the Shareholders have opened their Demat Account.

Shareholders' Initiative:

Pursuant to Sections 20, 101 and 136 of the Companies Act, 2013 and Rules made there under, Companies can send notices/documents in electronic form to their Members. To enable the Company to send its Annual Report, Notice of AGM and other documents for the FY 2015-16 electronically, Members are requested to update their email ids with their Depository Participants (in case the Shares are held in dematerialized form) or RTA of the Company (in case the Shares are held in physical form) and accord their consent for receiving documents through electronic mode.

SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 mandates the Company to obtain a Certificate either from the Auditors or from the Practicing Company Secretary regarding the compliance of Corporate Governance as stipulated in Listing Regulations and annex the Certificate with the Directors' Report, which is sent annually to the Shareholders and also send the same to the Stock Exchanges. We have obtained a Certificate from our Statutory Auditors to this effect and the same is annexed herewith.

Corporate Governance Compliance

Compliance with Mandatory & Non-mandatory Requirements.

The Company has complied with all the mandatory requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Company has fulfilled the following non-mandatory requirements as prescribed in Schedule II, PART E of Regulation 27(1) of (Listing Obligations and Disclosure Requirements) Regulations, 2015.

A. Audit Qualifications

It is always the Company's endeavour to Audit present unqualified Financial Statements. There is no Audit Qualification in the Statutory Audit Report of the Company for the Financial Year ended 31stMarch, 2016.

B. Separate posts of Chairman and Managing Director

The Company's Chairman is Mr. Ram Gopal Agarwal and Managing Director is Mr. Mahendra Kumar Dhanuka.

C. Reporting of Internal Auditor

The Internal Auditor has been reporting directly to the Audit Committee

D. The Company has a Subsidiary Company but that is not a Material Subsidiary Company.

E. Your Company has complied with all the requirement of Regulations 17 to 27 and clause (b) to (i) of sub-regulation 46 of SEBI( Listing obligations and Disclosure Requirements) Regulations, 2015 except regulation 24(1) which is not applicable to the Company.