Your Directors are pleased to present the 32nd Annual Report together with the Audited
Standalone Financial Statements of the Company for the Financial Year ended 31st March 2024.
Members may kindly note that till 12th May 2023, your Company was under Corporate
Insolvency Resolution Process (“CIRP”) and the affairs of the Company were vested with the
ERP. On 12th May 2023, the Hon’ble National Company Law Tribunal, New Delhi Bench
(“NCLT”), approved the Resolution Plan submitted by the consortium of Manjeet Cotton
Private Limited and Vitthal Corporation Limited prepared in accordance with the provisions of
the Insolvency and Bankruptcy Code, 2016.
Thereafter, the Implementation & Monitoring Committee (IMC) was formed for
implementation of the aforesaid Resolution Plan and pending for dissolution and the new Board
was constituted on 31st August 2023 and subsequently formed various committee in the Board
meeting held on 9th October 2023 as per applicable law.
SUCCESSFUL IMPLEMENTATION OF RESOLUTION PLAN:
Upon successful implementation of the Resolution Plan, the following activities have been
made in the Company:
a. Reconstitution of the Board of Directors of the Company and its Committees;
b. Slump-sale of Company’s units located at Butibori, Pithampur and Solapur;
c. Reduction and extinguishment of Share Capital of the Company, detailed in Note No: 14
to standalone financial statements;
d. Allotment of securities;
EFFECTS OF IMPLEMENTATION OF RESOLUTION PLAN:
Your Company has become a subsidiary of Manjeet Cotton Private Limited, CIN-
U00171MH2005PTC246580, Chhatrapati Sambhajinagar-431003, Maharashtra with effect from
27th December, 2023.
FUTURE OUTLOOK:
With the implementation of the Resolution Plan, your Company is hopeful and confident of
accomplishing improved sales and EBIDTA over period of time.
As of now, your company is under revamping situation after CIRP period. Although, your
Directors/Management are committed to start commercial production very soon.
1. STANDALONE FINANCIAL RESULTS:
Highlights of Financial Results for the year are as under' in lakhs except EPS)
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Particulars
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2023-24
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2022-23
|
|
Revenue from operation
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-
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-
|
|
Other Income
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789.34
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0.63
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Profit /(Loss) before finance cost, depreciation and amortization
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-1,944.94
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-193.69
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Finance cost
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370.72
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-
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Profit/(Loss) before depreciation and amortization
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-2,315.66
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-193.69
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Depreciation and amortization
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1,001.72
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900.73
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Profit/(Loss) before tax
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-3,317.39
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-1,094.42
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Tax Expenses
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110.69
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-
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Net Profit/(Loss) for the period
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-3,428.08
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-1,094.42
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EPS (Basic & Diluted) ?
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-4.97
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-1.22
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2. CHANGE IN THE NATURE OF BUSINESS:
During the year under review, there has been no material change in the nature of business of the
Company.
3. STATE OF COMPANY’S AFFAIRS:
There were no business operations during the year under review as the Company is in the process
of regularizing various statutory compliances including revamping the business operation of the
Company. In view of this the turnover of the Company for the Financial Year 2023-24 was Nil.
The Net Loss after tax stood at ? 3428.08 Lakhs as against ? 1,094.42 lakhs over last year.
4. DIVIDEND:
The Board of Directors does not recommend dividend for the Financial Year ended on 31st March,
2024 in view of losses suffered by the Company for the year under review.
5. TRANSFER TO RESERVES:
During the year under review, no amount was proposed to be transferred to Reserves due to
losses.
6. MATERIAL CHANGES AND COMMITMENTS:
No material changes and commitments affecting the financial position of the Company have
occurred between the end of the Financial Year of the Company to which the financial statements
relate and the date of the report.
7. SHARE CAPITAL:
As a part of the implementation of the Resolution Plan approved by the Hon’ble NCLT under
Section 30(6) of the Insolvency and Bankruptcy Code, 2016, vide its order dated 12th May 2023,
the following changes have taken place in the share capital of your Company during the year
under review:
Paid-up Share Capital
The Approved Resolution Plan provides for reduction of existing paid-up capital of the Corporate
Debtor in the below mentioned manner:
• to extinguish the 100% shares of the erstwhile Promoter/Promoter group shareholders
• to reduce the paid-up share capital to the extent of 99% which was held by the public
shareholders.
To give effect to the said capital reduction, Company has taken 2 steps as mentioned under:
• Firstly, Company has issued 98,74,932 equity shares of ? 10/- each to the new promoter
i.e. Manjeet Cotton Private Limited along with its nominee on 27th December 2023.
• Secondly, alloted 5,19,748 new equity shares of ? 10/- each to the Public Shareholder as
on the Record Date i.e. 12th January 2024.
Pursuant to the aforesaid action, the issued, subscribed and paid-up equity share capital of the
Company shall stand as 1,03,94,680 equity shares of 10/-each fully paid-up which aggregate to
paid-up capital of ? 10,39,46,800/- as 31st March 2024.
8. EMPLOYEE STOCK OPTION SCHEME (ESOS):
During the year under review, the Company has not bought back any of its securities/ not issued
any sweat equity shares / not provided any Stock Option Scheme to its employees / not issued any
equity shares with differential rights.
9. DEPOSITS:
During the year under review, your Company has not accepted/ renewed any public deposits
within the meaning of Sections 73 to 76A of the Companies Act, 2013 read with the Companies
(Acceptance of Deposits) Rules, 2014.
10. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER
SECTION 186 OF THE COMPANIES ACT, 2013:
During the year under review, your company has not given any loans, guarantees or investments
under Section 186 of the Act. Members may send their request through email to the Company for
the inspection of Register maintained under Section 186 of the Act.
11. DETAILS OF POLICY DEVELOPED AND IMPLEMENTED ON CORPORATE
SOCIAL RESPONSIBILITY:
As the average net profit of the Company during previous three Financial Years is negative, the
Company is not required to spend any amount for the CSR purpose during the year under review.
The policy on CSR as approved by the Board of Directors is also hosted on the website of the
Company and can be accessed from web link: http://www.clcindia.com/disclosure.php#
12. ADEQUACY OF INTERNAL FINANCIAL CONTROL SYSTEM:
The Company has in place adequate internal financial controls with reference to financial
statements. A report on the Internal Financial Controls under clause (i) of sub-section 3 of section
143 of the Companies Act, 2013 as given by the Statutory Auditors of the Company forms part
of Independent Auditor’s Report on Standalone Financial Statements as Annexure A.
13. RISK MANAGEMENT:
The newly appointed Board of Directors at their meeting held on 9th October, 2023 has adopted
the Risk Management Policy for the Company. The Audit Committee shall review the status of
key risks and steps to be taken by the Company to mitigate such risks at regular intervals.
14. VIGIL MECHANISM/WHISTLE BLOWER POLICY:
Your Company has adopted a Vigil Mechanism/Whistle Blower Policy in terms of the provisions
of Companies Act, 2013 and the Listing Regulations, to provide a formal mechanism to the all
directors, employees, business associates and other stakeholders which are a part of the business,
ecosystem of the Company to report their genuine concerns and grievances about unethical
behavior, actual or suspected fraud or violation of the Company’s Code of Conduct or Ethics.
The policy provides adequate safeguards against victimization of the all directors, employees,
business associates and other stakeholders who avail such mechanism and also provides for direct
access to the Vigilance Officer and the Chairman of Audit Committee. The Audit Committee of
the Board is entrusted with the responsibility to oversee the vigil mechanism.
During the year, no personnel was denied access to the Chairman of the Audit Committee. The
Vigil Mechanism/Whistle Blower Policy is available on the website of the Company at
http: //www.clcindia. com/disclosure .php
15. SUBSIDIARY / JOINT VENTURE / ASSOCIATE COMPANY:
The subsidiary, namely Amit Spinning Industries Limited (ASIL) has under gone CIRP, pursuant
to which NCLT, Ahmedabad Bench approved the Resolution plan vide its order dated 31st July
2018. In view of this, entire share capital held in ASIL has become Nil.
Further, subsidiary, namely Spentex Netherlands B.V. has been transferred to erstwhile
promoters of the Company in accordance with the relevant terms of the Resolution Plan approved
by the Hon’ble National Company Law Tribunal vide its order dated 12th May, 2023.
In view of above, the Company does not have any subsidiaries / joint venture / associate Company
as on 31st March 2024 and the disclosure in Form AOC-1 shall not be applicable to the Company
for the Financial Year 2023-24.
16. IMPLEMENTATION & MONITORING COMMITTEE (IMC):
On 12th May 2023 formed the IMC for implementing approved Resolution plan and Mr. Subhash
Kumar Kundra, Erstwhile Resolution Professional is the Chairman of the Implementation and
Monitoring Committee formed for implementing the approved Resolution plan.
17. CHANGE IN DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Liable to retire by Rotation:
In accordance with the provisions of the Articles of Association of the Company, Mr. Sanchit
Singh Rajpal, Managing Director of the Company, retires by rotation at the conclusion of the
forthcoming Annual General Meeting and being eligible, offers himself for re-appointment. The
Board recommended his re-appointment for the consideration of the Members of the Company
at the ensuing Annual General Meeting.
Appointment of Directors:
During the year under review, IMC appointed Mr. Bhupendra Singh Rajpal as an Additional
Director of the Company w.e.f. 12th July 2023 and thereafter Board had been re-constituted on
31st August 2023 and appointed Mr. Sanchit Singh Rajpal as an Additional Director, Mr. Gautam
Nandawat as an Additional Independent Director and Mrs. Satinder Kaaur, as an Additional
Independent Woman Director.
The newly constituted Board of Directors as referred above at their first meeting held on 9th
October 2023 have appointed Mr. Bhupendra Singh Rajpal as Chairman of the Company for the
period of 5 years and Mr. Sanchit Singh Rajpal appointed as Managing Director of the Company
for the period of 5 years, subject to approval of the members of the Company at the ensuing
Annual General Meeting. Subsequently, they had been regularized in the Annual General
Meeting of the Company.
Cessation from Directorship:
During the year under review, as per Hon’ble NCLT order dated 12th May 2023, all the existing
directors i.e. Mukund Choudhary, Managing Director, Kapil Choudhary, Deputy Managing
Director, Ms. Honey Deep Kaur, Independent Woman Director and Mohd. Asim, Independent
Director of the Company, without any further action being required on the part of any Person,
shall deemed to have resigned w.e.f order date from the Board of Directors of the Company.
Key Managerial Personnel:
Mr. Shrutisheel Jhanwar was appointed as Chief Financial officer of the Company with effect
from 20th December 2023 on the basis of recommendation made by Nomination and
Remuneration Committee of the Board of Director.
18. FORMAL ANNUAL EVALUATION:
The erstwhile Board of Directors of the Company were replaced by the new Board of Directors
with effect from 31st August, 2023. The new Board was not evaluated during the year under
review after re-constitution. The Company has put in place a policy containing, inter alia, the
criteria for performance evaluation of the Board, its committees and individual Directors
(including independent directors).
19. DISCLOSURE REQUIRED UNDER SECTION 134(3)(e) AND SECTION 178(3) OF
THE COMPANIES ACT, 2013:
The Board has on the recommendation of the Nomination and Remuneration Committee, framed
a policy for selection and appointment of Directors, Key Managerial Personnel and Senior
Management and their remuneration. The Policy broadly lays down the guiding principles,
philosophy and the basis for payment of remuneration to Executive and Non-Executive Directors,
Key Managerial Personnel and Senior Management. The policy also provides the criteria for
determining qualifications, positive attributes and Independence of Director and criteria for
appointment and removal of Directors, Key Managerial Personnel/Senior Management and
performance evaluation which are considered by the Nomination and Remuneration Committee
/ Board of Directors.
The terms and conditions of appointment of Independent Director stipulates the manner of
appointment, role & functions, duties, relevant provisions of section 149, 150 and 152 of the Act
and ‘Guidelines for Professional Conduct’ pursuant to Schedule IV to the Act and are forming
part of appointment letter.
The policy is available on the website of the Company at http://www.clcindia.com/disclosure.php
20. FAMILIARIZATION PROGRAM FOR THE INDEPENDENT DIRECTORS:
In compliance with the requirements of SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015, the Company has put in place a familiarization programme for the Independent
Directors to familiarize them with their role, rights and responsibility as Directors, the working of
the Company, nature of the industry in which the Company operates, business model etc. The
details of the familiarization programme are explained in the Corporate Governance Report and
policy was disclosed on the Company’s website at http://www.clcindia.com/disclosure.php
21. STATEMENT ON DECLARATION BY INDEPENDENT DIRECTORS:
The Company has received the necessary declaration from each independent director who are
part of re-constituted Board confirming that he/she meets the criteria of independence as laid out
in Section 149(6) of the Companies Act, 2013 read with the schedules, rules made thereunder
and Regulation 16(1) (b) of the Listing Regulations.
22. BOARD AND COMMITTEE’S MEETINGS:
A calendar of Meetings is prepared and circulated in advance to the Directors. During the year
under review, 7 meetings of the Board were held. The details of the Board and Committee
meetings are provided in the Corporate Governance Report forming part of this Report.
23. COMMITTEES OF BOARD:
With an objective of strengthen the governance standards and to comply with the applicable
statutory provisions, the Board has constituted various committees with effect from 9th October,
2023. Details of such committees constituted by the Board are given in the Corporate Governance
Report, which forms part of this Annual Report.
24. DIRECTORS’ RESPONSIBILITY STATEMENT:
Pursuant to Section 134(3) (c) of the Act, the Board of Directors to the best of its knowledge and
ability confirm that:
(a) in preparation of the annual accounts, the applicable accounting standards have been followed.
(b) they 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 Profit and Loss of the
Company for that period.
(c) they 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) they have prepared the annual accounts on a going concern basis.
(e) they have laid down internal financial controls to be followed by the Company and such
internal financial controls are adequate and operating effectively.
(f) the directors have devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems are adequate and operating effectively.
25. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED
PARTIES:
The Board of Directors of the Company, acting upon the recommendation of its Audit Committee
of Directors, has approved the policy and procedures with regard to Related Party Transactions
for reviewing, approving and ratifying Related Party transactions and in providing disclosures
with respect to the above transactions, as required under the Companies Act, 2013, SEBI (Listing
Obligations Disclosure Requirements) Regulations, 2015 (“Listing Regulations”) as amended
from time to time and other applicable provisions, rules and regulations made thereunder.
All related party contracts/arrangements/ transactions that were entered into during the financial
year were on an arm’s length basis and were in the ordinary course of business. All Related Party
Transactions are placed before the Audit Committee for approval. Prior omnibus approval of the
Audit Committee was obtained for the transactions which are of a foreseen and repetitive nature.
The statement of transactions entered into pursuant to the omnibus approval so granted is placed
before the Audit Committee for approval on a quarterly basis. Accordingly, transactions are being
reported in Form AOC-2 in terms of Section 134 of the Act read with Rule 8 of the Companies
(Accounts) Rules,2014. is Annexure ‘A’, The details of the transactions with Related Parties are
provided in the Note no-38 of the Standalone financial statements in accordance with the
Accounting Standards.
The updated policy on Related Party Transactions as approved by the Board is uploaded on the
Company’s website, the weblink of which is as under: http://www.clcindia.com/disclosure.php
26. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR
COURTS OR TRIBUNALS IMPACTING THE GOING CONCERNS STATUS AND
COMPANY’S OPERATIONS IN FUTURE:
During the Company was under Corporate Insolvency Resolution Process (“CIRP”) since 3rd
January, 2020 till 12th May 2023. On this day the Hon'ble National Company Law Tribunal
("NCLT"), Principal Bench, New Delhi passed an order and approved the Resolution plan
submitted by Manjeet Cotton Private Limited & Vitthal Corporation Limited in consortium
(“Resolution Applicants”) as approved by the Committee of Creditors with the requisite majority
as per Section 30(4) of the IBC in accordance with Section 30(6) of the Insolvency and
Bankruptcy Code (“IBC”).
Except above, no other significant or material orders were passed by the Regulators or Courts or
Tribunals impacting the going concern status and Company’s operations in future.
27. AUDITORS AND THEIR REPORTS:
Statutory Auditor
In terms of provisions of Companies Act 2013 read with Companies (Audit & Auditors) Rules
2014 M/s. Ashok R. Majethia & Co., Chartered Accountants (Firm Registration No. 127769W),
have been appointed as Statutory Auditors for the first term of 5 consecutive years by the
shareholders with effect from the conclusion of 31st Annual General Meeting till the conclusion
of 36th Annual General Meeting.
There are no cases of fraud detected and reported by the Auditor under Section 143(12) during
the Financial Year. The auditors have not reported any fraud during the year and hence
information under Section 134(3) (ca) may be treated as NIL.
During the Financial Year under review, there are qualifications made by the Statutory Auditor
on the Standalone Financial Statements of the Company.
BOARD’S EXPLANATION OR COMMENTS ON QUALIFICATIONS MADE BY THE
AUDITOR IN HIS REPORT ARE AS UNDER:
a. No provision is made in respect of Security Deposit ?124.19 Lakhs, Balance with
Government Authorities ?3908.20 Lakhs considered doubtful of recovery in absence of
adequate details and liability in respect of gratuity and compensated absences for which
liability has not been ascertained- We are trying to get relevant details from old software
through RP office, so we can recover the money. Further there will not be any financial impact,
if we will not be in position to recover the same will be adjusted over a period of time out of
Capital Reserve.
b. The details in respect of Income tax refund receivable of ?113.21 Lakhs, and Balances
with Government Authorities of ?5402.98 Lakhs are not available with the company- We
shall explore to get the money. Further there will not be any financial impact, if we will not be
in position to recover the same will be adjusted over a period of time out of Capital Reserve.
c. The company has written off cash balance of ?40.62 Lakhs in the books of account on the
plea of the present management that the same is not handed over to the new management-
As we have not received such cash balance at the time of getting hand over, therefore write off.
As such there is no financial impact.
d. The fixed deposits receipts of ?340.51 Lakhs were not found on record and no
confirmation was made available for ?8.68 lakhs from the bank- Fixed deposit receipt lying
with RP, as he is responsible for making payment, we shall get copies from them. As such there
is no financial impact.
e. The balances of Trade Receivable, bank balances including fixed deposits, Trade Payable,
Unsecured Loans, Employees, current and non-current Loans and Advances, and
Liabilities are subject to confirmations and reconciliation-We don’t have address, but still
try to get address from Software through RP office, and through Bank in case of Fixed deposit.
Further, we have reconciliation with them but no written confirmation. Further there will not
be any financial impact, if we will not be in position to recover the same will be adjusted over
a period of time out of Capital Reserve.
Cost Auditor
As per the provisions of Section 148 of the Companies Act, 2013, read with the Companies (Audit
and Auditors) Rules, 2014 framed thereunder, the maintenance of Cost records and appointment
of Cost Auditor is not applicable to the Company during the year under review.
Secretarial Auditor
Mr. Ajit Kumar (CP No. 10990), Practicing Company Secretary was appointed as a Secretarial
Auditor of the Company as per Section 204 of the Companies Act, 2013 for the Financial Year
2023-24. The Secretarial Audit Report is annexed herewith as Annexure ‘B’ and this Report is
self-explanatory and requires no comments.
28. ENHANCING SHAREHOLDERS’ VALUE:
The Company is committed to creating value for its other stakeholders by ensuring that its
positively impact the socio-economic and environmental dimensions and contribute to
sustainable growth and development.
29. CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION AND
ANALYSIS REPORT:
The Corporate Governance Report and Management Discussion & Analysis, which form part of
this Report, together with the Certificate from the Practicing Company Secretary of the Company
regarding compliance of conditions of Corporate Governance as stipulated in Schedule V of
Regulation 34(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015 and the declaration by the Chairman regarding affirmations for compliance with the
Company’s Code of Conduct are annexed to this report as Annexure ‘C to F’.
30. SECRETARIAL STANDARDS:
During the year under review, the Company has complied with the provisions of Secretarial
Standard-1 and Secretarial Standard - 2 issued by the Institute of Company Secretaries of India.
31. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN
EXCHANGE EARNINGS AND OUTGO:
No business activity has been carried out during the year under review: -
A. Conservation of Energy
As there were no transaction during the period under review as plant was under repair and
maintenance.
B. Technology Absorption:
As there were no transaction during the period under review as plant was under repair and
maintenance.
C. Foreign Exchange Earning and Outgoing
There were no foreign exchange earnings and outgo during the Financial Year as per the audited
financial statements.
32. ANNUAL RETURN:
A copy of Annual Return as provided under section 92(3) and section 134(3)(a) of the Companies
Act, 2013 ('the Act') is made available on the website of the Company and can be accessed at
http://www.clcindia.com/disclosure.php
33. PARTICULARS OF EMPLOYEES:
Disclosures pertaining to remuneration and other details as required pursuant to Section 197(12)
of the Companies Act, 2013 read with Rule 5(1)/ (2)/(3) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 is not applicable to the Company during the
period under review.
34. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013:
The Company has adopted a policy on prevention, prohibition and redressal of sexual harassment
at workplace in line with the provisions of Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder. The aim of the
policy is to provide protection to women employees at the workplace and prevent and redress
complaints of sexual harassment and for matters connected or incidental thereto, with the
objective of providing a safe working environment, where women employees feel secure.
All women employees (permanent, contractual, temporary, trainees) are covered under the said
policy.
Your Company has complied with provisions relating to the constitution of Internal Complaints
Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013, to redress complaints received on sexual harassment.
No complaint was pending at the beginning of the year and none was received during the year.
35. LISTING:
Your Company’s shares were listed on BSE Limited (BSE) and National Stock Exchange of India
Limited (NSE), however trading was suspended due to procedural reasons.
36. GENERAL:
The Board of Directors state that no disclosure or reporting is required in respect of the following
matters as there were no transactions or applicability pertaining to these matters during the year
under review:
a. Payment of remuneration or commission from any of its holding or subsidiary companies to
the Managing Director/ Whole Time Director of the Company.
b. Voting rights which are not directly exercised by the employees in respect of shares for the
subscription/ purchase of which loan was given by the Company (as there is no scheme pursuant
to which such persons can beneficially hold shares as envisaged under section 67(3)(c) of the
Companies Act, 2013).
c. Details of any application filed for corporate insolvency under Corporate Insolvency
Resolution Process under the Insolvency and Bankruptcy Code, 2016.
d. One time settlement of loan obtained from the banks or financial institutions.
ACKNOWLEDGEMENTS
The Board expresses its sincere thanks to all the employees, customers, suppliers, investors,
lenders, regulatory and government authorities and stock exchanges for their co-operation and
support and look forward to their continued support.
On behalf of the Board of Directors
CLC Industries Limited
(Formerly known as Spentex Industries Limited)
Sd/- Sd/-
Bhupendra Singh Rajpal Sanchit Singh Rajpal
Chairman Managing Director
DIN: 00311202 DIN: 00311190
Place: Chhatrapati Sambhajinagar (Aurangabad)
Date: 30th May 2024
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