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Donear Industries Ltd.

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  • 78.95 1.45 (1.87%)
  • Vol: 23461
  • BSE Code: 512519
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  • Vol: 150483
  • NSE Code: DONEAR
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Donear Industries Ltd. Accounting Policy

CORPORATE GOVERNANCE REPORT

1.COMPANY'S PHILOSOPHY

We, at Donear Industries Limited, believe that for a Company to succeed it must maintain global standards of corporate conduct towards employees, customers and society. The Company believes that it is rewarding to be better managed and governed and to identify and align its activities with national interest. To that end, we, as a Company have always focused on good corporate governance - which is a key driver of sustainable corporate growth and long term value creation.

At Donear Industries Limited, we view Corporate Governance in its widest sense, almost like a trusteeship. Corporate Governance is not simply a matter of creating checks and balances: it is about creating an outperforming organization. The primary objective is to create and adhere to corporate culture of conscience and consciousness, transparency and openness; and to develop capabilities and identify opportunities that best serve the goal of value creation. Good governance is an integral part of Donear Industries Limited Management, in its pursuit of excellence, growth and value creation with a clear focus on its employees, customers, shareholders and the community at large - its stakeholders, beyond the metric of stock market and market capitalization.

Corporate Governance is not merely compliance - it is an ongoing measure of superior delivery of Company's objects with a view to translate opportunities into reality. It involves leveraging its resources and aligning its activities to customer need, shareholder benefit and employee growth, thereby delighting all its stakeholders while minimizing risks.

The Company has established procedures and systems to be fully compliant with the requirements stipulated by the Securities and Exchange Board of India (SEBI) from time to time, under the revised Clause 49 of the Listing Agreement entered into with the Stock Exchanges. The provisions of Clause 49 have been implemented in a manner so as to achieve the objectives of Corporate Governance.

2. RIGHTS OF THE SHAREHOLDERS

The Company believes in protecting the rights of the shareholders. It ensures adequate and timely disclosure of all information to the shareholders in compliance with the applicable laws. Shareholders are furnished with sufficient and timely information concerning the general meetings, issues to be discussed thereat and rules regarding holding and conducting the general meetings. All shareholders are treated equitably.

3.ROLE OF THE STAKEHOLDERS

The Company recognizes the rights of the stakeholders who are provided opportunity to obtain effective redressal for violation of their rights. Keeping the same in view, the Company has laid down an effective whistle blower policy enabling stakeholders, including employees to freely communicate their concerns about illegal or unethical practices.

4.BOARD OF DIRECTORS

a) Composition and Category of Directors

The Board of Directors of the Company have an optimum combination of Executive, Non-Executive and Independent Directors who represents the optimum mix of professionalism, knowledge and experience.

The Board's composition is in accordance with the requirements of Clause 49 of the Listing agreement.

As on 31st March, 2015 The Board of the Company comprises Seven Directors - Two Executive Directors and Five Non-Executive Directors, of whom three are Independent Directors. The current strength of the Board includes one Women Director as required under applicable legislation. The Chairman of the Board is a Non-Executive Promoter Director. Directors' Attendance Record and Directorship / Committee Membership / Chairmanship held as on 31.03.2015

•Number of Directorships/memberships and Committee position held in other companies excludes directorship/member in Private Limited Companies, Foreign Companies and Companies under section 8 of the Companies Act, 2013 and includes Audit Committee, Stakeholders Relationship Committee in Public Limited Companies including Donear Industries Limited.

b)Appointment / Reappointment of Directors:

Mr. Ajay V. Agarwal retires by rotation.

Mrs. Neena Agarwal & Mrs. Medha Pattanayak were appointed as additional directors of the Company on 30.03.2015 & 05.05.2015 respectively. Pursuant to Sec. 161 of the Companies Act, 2013, an additional director ceases to be a director at the commencement of the ensuing Annual General Meeting or the last date on which the Annual General Meeting should have been held whichever is earlier. Accordingly, the above two directors cease to be directors at the ensuing Annual General Meeting and they are eligible for reappointment as regular directors

c)Independent Directors

The Independent Directors of the Company fully meet the requirements laid down under Clause 49 II (B) of the Listing Agreement. As mandated by Clause 49 of the Listing Agreement:

An independent director in relation to a company, means a non executive director other than a nominee director of the Company,

•Who in the opinion of the Board, is a person of integrity and possesses relevant expertise and experience;

•(i) is or was not a promoter of the Company or it's holding, subsidiary or associate Company;

•(ii) is not related to promoters or directors in the Company, its holding, subsidiary or associate Company;

•Apart from receiving directors remuneration who has or had no material pecuniary relationship with the Company, its holding, subsidiary or associate company or their promoters or directors, during the two immediately preceding financial years or during the current financial year;

•None of whose relatives has or had pecuniary relationship or transaction with the Company, its holding, subsidiary or associate company or their promoters or directors amounting to two percent or more of its gross turnover or total income or fifty lakh rupees or such higher amount as may be prescribed, whichever is lower, during the two immediately preceding financial years or current financial year;

•Who neither himself nor any of his relatives -

( i) holds or has held the position of Key Managerial Personnel or is or has been employee of the Company or its holding, subsidiary or associate company in any of the three financial years immediately preceding the financial year in which he is proposed to be appointed;

(ii ) is or has been employee or proprietor or a partner, in any of the three financial years immediately preceding the financial year in which he is proposed to be appointed, of-

(a)A firm of auditors or company secretaries in practice or cost auditors of the company or its holding, subsidiary or associate company ; or

(b)Any legal or a consulting firm that has or had any transaction with the Company, its holding, subsidiary or associate company amounting to ten percent or more of the gross turnover of such firm;

•Holds together with his relatives two per cent or more of the total voting power of the company: or

•Is a Chief Executive or director, by whatever name called , of any non profit organization that receives twenty five percent or more of its receipts from the Company, any of its promoters , directors or its holding, subsidiary or associate company or that holds two per cent or more of the total voting power of the company;

•Is a material supplier, service provider or a customer or a lessor or lessee of the company;

•Who is not less than 21 years of age.

The tenure of the Independent Directors is fixed in accordance with the requirements laid down in the Companies Act, 2013 and clarifications / circulars issued by the Ministry of Corporate Affairs, in this regard, from time to time.

All the Independent Directors have furnished a declaration that he / she meets the criteria of independence as laid down in Section 152 of the Companies Act, 2013.The Company has provided the appointment letter to Independent Directors along with code for independent directors which are also available on the Company's website.

d)Performance Evaluation of Directors

The Nomination and Remuneration Committee has laid down the criteria for performance evaluation of Non Executive Directors. The parameters of performance evaluation of the Non Executive Directors will capture the following points:

•Attendance at meetings of the Board and Committee thereof,

•Participation in Board meetings or Committee thereof,

•Contribution to strategic decision making,

•Review of risk assessment and risk mitigation,

•Review of financial statements, business performance, and

•Contribution to the enhancement of brand image of the Company.

The Board of Directors (excluding the Director being evaluated) had, in their Meeting held on 06th March, 2015 evaluated the performance of all the Directors on the Board.

e) Separate meetings of the Independent Directors

The Independent Directors held a Meeting on 06th March, 2015, without the attendance of Executive Directors and members of Management. At the Meeting, they :

(i)reviewed the performance of non-independent directors and the Board as a whole;

(ii)assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

BOARD MEETINGS AND GENERAL MEETINGS

a) The Board meets at least four times in a year with a maximum time gap of one hundred and twenty days between two Board Meetings is not more than 4 months as per the Clause 49 of the Listing Agreement.

The meetings of the Board of Directors/Committee are held in Mumbai. The Board meets at least once in a quarter interalia to review the quarterly performance and financial results. A total of six Board Meetings were held during the year 2014-2015 on the following dates: 29.04.2014, 30.05.2014, 14.08.2014, 14.11.2014, 14.02.2015 and 25.02.2015.

The Board is apprised and informed of all the important matters relating to the business of the Company including those information as prescribed in Annexure X of the Clause 49 of the Listing Agreement. The Managing Director finalizes the items to be included in the agenda of the meeting and the same is sent to the members of the Board well in advance along with the relevant details and explanatory notes wherever required.

Information Supplied to the Board / Committees

Among others, information supplied to the Board / Committees includes: Annual operating plans and budgets and any update thereof. Capital budgets and any updates thereof.

Quarterly results of the Company and its operating divisions or business segments. Minutes of the Meetings of the audit committee and all other Committees of the Board.

The information on recruitment and remuneration of senior officers just below the Board level, including the appointment or removal, if any, of Chief Financial Officer and Company Secretary.

Show cause, demand, prosecution notices and penalty notices, which are materially important. Fatal or serious accidents, dangerous occurrences, any material effluent or pollution problems.

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

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.

Details of any joint venture or collaboration agreement.

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

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

Sale of material nature of investments, assets which are not in the 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.

Non-Compliance status of any regulatory, statutory nature or listing requirements and shareholders' service, such as non-payment of dividend, delay in share transfer etc.

Compliance with all the laws as applicable to the Company.

6. BOARD COMMITTEES

As mandated by the revised Clause 49 which has become applicable to the Company with effect from 1st October, 2014, none of the Directors on the Board is a Member of more than ten (10) Committees and none is a Chairman of more than five (5) Committees across all the Indian Public Limited Companies in which they are Directors. All the Directors have made necessary disclosures regarding Committee positions held by them in other Companies.

To align with the requirements prescribed for such Board Committees under the provisions of the Companies Act, 2013 and the revised Clause 49 of the Listing Agreement, during the year ended 31 March, 2015, the Board of Directors amended the terms of references, wherever required.

The Board has constituted the following committees of Directors:-

i)Audit Committee.

ii)Nomination and Remuneration Committee.

iii)Stakeholders Relationship Committee.

iv)Corporate Social Responsibility (CSR) Committee.

v)Risk Management Committee i) AUDIT COMMITTEE

a)Terms of Reference

The terms of reference to the Audit Committee include the matters specified under sub clause (iii) of clause 49 of the Listing Agreement.

b)Composition & Meeting Attended

The Audit Committee comprises of three Non Executive Independent Directors including the Chairman of the Audit Committee. The Audit Committee Meeting during the year under report was held on 30th May, 2014, 14th August, 2014, 14th November, 2014 & 14th February, 2015.The details of the members of Audit Committee and meeting attended by them are as under:

The Board has designated Company Secretary to act as Secretary of the Audit Committee. The members of the Audit Committee are financially literate. The Chairman of the Audit Committee was present at the last Annual General Meeting.

c) Power of Audit Committee

The Audit Committee has the following powers:

1) To investigate any activity within the terms of reference

2)To seek information from any employee

3)To obtain outside legal or other professional advice

4)To secure attendance of outside with relevant expertise, if considered necessary.

d)Role of Audit Committee

(i)Overview of the Company's financial reporting process and the disclosure of its financial information to ensure that the financial statements are correct, sufficient and credible.

(ii)Recommending the Board, the appointment, re-appointment and if required replacement or removal of Statutory Auditors and fixation of Audit fees.

(iii)Approval of payment to Statutory Auditors for any other services rendered by Statutory Auditors.

Reviewing with management the annual financial statements before submission to the Board for approval, with particular reference to:

•Matters required being included in Directors' Responsibility statement to be included in the Board's Report in terms of Clause 3 (c) of section 134 of the Companies Act, 2013.

•Changes if any, in accounting policies and practices and reasons for the same.

•Major accounting entries involving estimates based on the exercise of judgment by management.

•Significant adjustments made in the financial statement arising out of audit findings.

•Compliance with Listing Agreement and other legal requirements relating to financial statements.

•Disclosures of related party transactions.

•Qualifications in draft Audit Report.

(iv)Reviewing, with the management, the quarterly financial statement before submission to the Board for approval.

(v)Reviewing, with the management the performance of Statutory and Internal Auditors, adequacy of internal control systems.

(vii)Discussion with the Statutory Auditors before the audit commences, about nature and scope of audit as well as post-audit discussion to ascertain any area of concern.

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

(ix)To review the functioning of Whistle Blower Mechanism, in case, if the same exists.

(x)Carrying out any other function as is mentioned in the terms of reference of Audit Committee.

e)Review of information by the Audit Committee

The Audit Committee reviews the following information:

1)The management discussion and analysis of financial condition and results of operations.

2)The statement of Significant related party transactions (as defined by the Audit Committee) submitted by the management.

3)Management letter / letters of internal control weaknesses issued by Statutory Auditors.

4)The appointment, removal and terms of remuneration of internal auditors shall be subject to review by the Audit Committee.

ii) Nomination and Remuneration Committee

a) Terms of Reference

The Company's Nomination and Remuneration Committee is vested with all the necessary powers and authority to ensure appropriate disclosure on the remuneration of whole-time director and to deal with all the elements of remuneration package of Directors and Management Personnel.

i)Formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a policy, relating to the remuneration of the directors, key managerial personnel and other employees.

ii)Formulation of criteria for evaluation of Independent Directors and the Board;

iii)Devising a policy on Board diversity.

iv)Identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, and recommend to the Board their appointment and removal. The company shall disclose the remuneration policy and the evaluation criteria in its Annual Report.

During the financial year 2014-15, there was no Nomination and Remuneration Committee Meeting. Remuneration Policy

The Remuneration Policy is based on three tenets: Pay for responsibility, Pay for performance and potential and pay for growth.

e) Remuneration paid to Directors

The Remuneration of Managing Director and Whole Time Director has been approved by the Nomination and Remuneration Committee, subsequently by the Board of Directors in accordance with and subject to the limits laid down in Schedule V to the Companies Act, 2013 and subject the approval of the Shareholders at the General Body Meeting.

The Non executive directors of the Company do not draw any remuneration other than sitting fees for attending the Board meetings, Audit Committee meetings, Remuneration Committee Meeting and any other committee meetings of the Board of Directors at Rs. 1000/- per meeting of the Board/ committee meetings.

iii) STAKEHOLDER RELATIONSHIP COMMITTEE:

The Board of Directors had constituted the Stakeholders Relationship Committee. The Committee focuses primarily on monitoring and ensuring that all shareholders and investor services operate in an efficient manner and that shareholders and investor grievances / complaints including that of all other stakeholders are addressed promptly with the result that all issues are resolved rapidly and efficiently Mr. Durgaprasad Agarwal, Non-executive and Independent Director is the Chairman of Stakeholder's Relationship Committee.

IV) CORPORATE SOCIAL RESPONSIBILITY (CSR) COMMITTEE

Pursuant to the provision of Section 135 of the Companies Act, 2013, the Company has constituted a Corporate Social Responsibility (CSR) Committee. The terms of reference of the CSR Committee include the matters specified under Section 135 of Companies Act, 2013. Pursuant to Sec 135 (5) of Companies Act, 2013 the Board shall ensure that the Company spends in every financial year at least 2% of the average net profits of the company during the three immediately preceding financial years. However during the financial year under report the Company has spent Rs. 328,000/- under CSR activities as required under Companies (Corporate Social Responsibility policy) Rules, 2014.

V) RISK MANAGEMENT COMMITTEE:

The terms of reference of the Risk Management Committee include implementation and monitoring the risk management plan for the Company.

After identifying the risks and assessing the level of impact controls are put in place to reduce the risk by the officers concern. During the financial year 2014-15, no meeting was held . The Company Secretary acts as the Secretary of the Committee.

DISCLOSURES:

a) Whistle Blower Policy / Vigil Mechanism

In line with the best Corporate Governance practices, Donear Industries Limited, has put in place a system through which the Directors, employees and business associates may report concerns about unethical behaviour, actual or suspected fraud or violation of the Company's Code of Conduct without fear of reprisal. The Company has put in place a process by which employees and business associates have direct access to the higher level and Compliance Officer. The Company's policy of Whistle Blower/ Vigil mechanism will be posted on Company's website www.donear.com

b) Related Party Transactions

The Company has formulated a policy on Related Party Transactions and also on dealing with Related Parties.

All Related Party Transactions have been approved by the Audit Committee and subsequently the approval of the Board would be taken on the said transactions at the Board meeting. The Company's policy of Related Party Transactions will be posted on Company's website www.donear.com provided the transactions to be entered into individually or taken together with previous transaction during financial year exceeds 10% of the annual turnover of the Company as per the last audited financial statement of the Company.

OTHER DISCLOSURES:

• There were no transactions of material nature with its Promoters, Directors or the Management, their subsidiaries or relatives during the period that may have potential conflict with the interest of the company at large.

• Transactions with related parties are disclosed in Note No. 30 in the notes to the accounts in the Annual Report as required by Accounting Standards under AS 18 issued by Institute of Chartered Accountants of India. The Audit Committee had reviewed the related party transactions as a mandatory requirement under clause 49 of the Listing Agreement and found them to be not materially significant.

• There were no non-compliances by the Company during the year. No penalties or strictures have been imposed on the Company by Stock Exchanges or SEBI or any other Statutory Authorities on any matters related to the capital markets, during the previous three financial years.

•The Board has adopted a Code of Conduct including Business Ethics Policy for its Directors and Senior Management. This is available on the Company's web-site.

•The Managing Director has submitted before the Board a declaration of compliance with the Code of Conduct by the Directors during the financial year ended March 31, 2015.

•No presentation was made/displayed in newspaper on website.

•The Company follows the Accounting Standards as prescribed in Companies Accounting Standards Rules 2006 and in the preparation of the financial statement; the Company has not adopted a treatment different from that prescribed by any Accounting Standard.

•Risk assessment and minimization procedures are periodically reviewed by the Audit Committee and the Board of Directors of the Company.

•The Chief Executive Officer and the Chief Financial Officer have certified to the Board of Directors as per the format prescribed in compliance Clause 49(V) of the Listing Agreement with the Stock Exchanges. This has been reviewed by the Audit Committee and taken on record by the Board of Directors of the Company.

•The Company has complied with all mandatory requirements under Clause 49 of the Listing Agreement with the Stock Exchanges. The adoption of non-mandatory requirements has been dealt with in this Report.

•Management Discussion and Analysis report form part of the Annual Report to the shareholders.

9.MEANS OF COMMUNICATION

a)Quarterly Unaudited Financial Results

Quarterly un-audited Financial Results were published in the Free Press Journal and Navshakti Newspaper. The half yearly report is not sent separately to the Shareholders. Annual Reports are sent to each shareholder at their Registered Address with the Company. The Company's website is: www.donear.com. The Company has updated the quarterly results on its website.

b)Management Discussion and Analysis Report

The Management Discussion and Analysis Report forms part of the Director's Report. All matters relating to Industry Structures and Development, Opportunities and Threats, Segment wise and Product wise performance, Outlook, Risks and Concern, Internal Control System and its adequacy, Discussion on financial performance with respect to operational performance, material development in human resources are discussed in the Director's Report.

10.RECONCIALITION OF SHARE CAPITAL AUDIT REPORT

A qualified Practising Company Secretary carried out secretarial audit to reconcile the total admitted capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) vis-a-vis the issued and listed capital.

The report by M/s. VKM & Associates, a Practising Company Secretary confirms that the total issued/paid up capital is in agreement with the total number of shares in physical form and the total number of dematerialized shares held with NSDL and CDSL.

Also, the Reconciliations of Share Capital audit report by M/s. VKM & Associates, a Practising Company Secretary have no adverse remarks for the year ended 31st March, 2015.The report is self-explanatory.

11. GENERAL SHAREHOLDER INFORMATION

1 Annual General Meeting :  26th September, 2015 11:30:00 AM

Donear House, 9th Floor, Plot No. A-50, Road No. 1, MIDC, Andheri (East), Mumbai – 400 093

2 Financial Calendar (Tentative)

Financials for Quarter ending :  Financial Reporting Date

June 30, 2015 : Second week of August, 2015

September 30, 2015:  Second week of November,2015

December 31, 2015 : Second week of February, 2016

March 31, 2016:  Last week of May 2016

Annual General Meeting for the year ended March. 31, 2015: August-September, 2015

3 Date of Book Closure 17th September, 2015 to 25th September, 2015 (both days inclusive)

4 Dividend Payment Date Within 30 Days from the date of AGM

5 Listing on Stock Exchanges

Name & Address of Stock Exchange Ltd

Stock Code Demat ISIN for NSDL & CDSL

Bombay Stock Exchange Ltd (BSE) 512519 : INE 668D01028

National Stock Exchange of India Ltd (NSE): DONEAREQ :  INE 668D01028  

6 Payment of Annual Listing fees Listing fees for the financial year 2015-2016 has been paid to both the Stock Exchanges BSE & NSE

7 Registrars & Transfer Agents Link Intime India Pvt. Ltd,

C-13, Pannalal Silk Mills Compound, L B S Marg, Bhandup (West), Mumbai - 400 078 Contact person Ms. Sadhna Sawant Contact No 25963838. Extn. 2297 Fax. : 25946969 Email sadhana.sawant@linktime.co.in

8 Custodial Fees to Depositories : The Company has paid custodial fees for the year 2015-16 to NSDL and CDSL.

9 Address for correspondence Donear Industries Limited

Donear House, 8th Floor, Plot No. A-50, Road No. 1, MIDC, Andheri (East), Mumbai – 400 093

10 For any assistance    

Regarding dematerialization of shares, share transfers, transmissions, change of address, non receipt of dividend or annual report or any other query relating to shares be addressed to Link Intime India Private Limited (Formerly Intime Spectrum Registry Limited), C-13, Pannalal Silk Mills Compound, LBS Marg, Bhandup (West), Mumbai - 400 078.; Phone: 022 25963838, Fax: 022 25946969; (Email : sadhana.sawant@linkintime.co.in)

12.SHARE TRANSFER SYSTEM

Securities lodged for transfer at the Registrar's Office are normally processed within 15 days from the date of lodgment, if the documents are clear in all respects. All requests for dematerialization of securities are processed and the confirmation is given to the depositories within 15 days. Company Secretary is empowered to approve transfer of shares and other investor related matters. Grievances received from investors and other miscellaneous correspondence on change of address, mandates, etc are processed by the Registrars within 30 days.

Physical shares received for dematerialization are processed and completed within a period of 21 days from the date of receipt. Pursuant to Clause 47(c) of the Listing Agreement with the Stock Exchanges, certificates, on half-yearly basis, have been issued by a Company Secretary-in-Practice for due compliance of share transfer formalities by the Company. Pursuant to SEBI (Depositories and Participants) Regulations, 1996, certificates have also been received from a Company Secretary-in-Practice for timely dematerialization of the shares of the Company and for conducting a Secretarial Audit on a quarterly basis for reconciliation of the Share Capital of the Company. Members holding shares in Demat mode should address all their correspondence to their respective Depository Participant.

16. TRANSFER OF UNCLAIMED DIVIDEND TO IEPF

As provided in Section 125 of the Companies Act, 2013, dividend amount which was due and payable and remained unclaimed and unpaid for a period of seven years has to be transferred to Investor Education & Protection Fund (IEPF) established by the Central Government.

The dividend for the following years remaining unclaimed for seven years will be transferred by the Company to IEPF according to the schedule given below. Shareholders who have not so far encashed their dividend warrant (s) or have not received the same are requested to seek issue of duplicate warrant (s) by writing to Link Intime India Private Limited (Formerly Intime Spectrum Registry Limited) confirming non - encashment / non - receipt of dividend warrant (s). Once the unclaimed dividend is transferred to IEPF, no claim shall lie in respect thereof.

17. DEMATERIALIZATION OF SHARES

The Company's Shares are required to be compulsorily traded in the Stock Exchanges in dematerialized form .The Company had sent letters to shareholders holding shares in physical form emphasizing the benefits of dematerialization and 99.87% of the shares have been dematerialized so far.

18.REGISTERED OFFICE ADDRESS FOR CORRESPONDENCE

Donear House, 8th Floor, Plot No. A-50, Road No. 1, MIDC, Andheri (East), Mumbai - 400 093Works / Office: Balaji Fabrics

Revenue Block No. 194 & 195 Kadodara Bardoli Road, Village Jolwa, Taluka Palsana, Dist.Surat, Gujarat. Laxmi Fab.

Government Industrial Estate, Masat, Silvassa, Dadra & Nagar Haveli. Umbergaon Unit G.I.D.C. Umbergaon, Dist. Valsad (Gujarat).

19.NON MANDATORY REQUIREMENTS

1.Chairman of the Board -No separate office is maintained for the Non-Executive Chairman.

Mr. Durga Prasad Agrawal, Mr. SantKumar Agrawal and Mr. Rajagopal Sivaraj are independent Directors on the Board of the Company. No specific period has been specified for these Directors. All of them have requisite qualification and experience and in the opinion of the Company this would enable them to contribute effectively to the Company in their capacity as Independent Directors.

2.Shareholder Right - The Company has not sent half yearly financial performance including summary of the significant events to each household of the shareholders, since the results were published in 2 news papers, one in Vernacular and one in English newspaper.

3.Audit Qualifications - During the year under review, there was no audit qualification in the Company's financial statements except internal audit system in the Company which the management is planning to appoint a firm of Chartered Accountants as Internal Auditors. The Company continues to adopt best practices to ensure a regime of unqualified financial statements.

4.Training of Board Members - The Board consists of eminent, qualified and well experienced Directors in various fields. Therefore, the training of Board members is not required.