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Directors Report of Nitin Fire Protection Industries Ltd.
Mar 31, 2024
The Annual Report of the Company together with the Audited Standalone and Consolidated
Financial Statements for the year ended 31st March, 2024:
1. CORPORATE INSOLVENCY RESOLUTION PROCESS TCIRPT:
Nitin Fire Protection Industries Limited is a company incorporated under the provisions of
Companies Act, 1956 (and validly existing under the provisions of the Companies Act, 2013)
having CIN L29193MH1995PLC092323. The Company has its registered office at 501, Delta,
Technology Street, Hiranandani Gardens, Powai, Mumbai - 400076, Maharashtra, India.
The CIRP of the Company commenced under the terms of Chapter II of the Insolvency and
Bankruptcy Code, 2016 (''IBC, 2016 or IBC'') vide the order (C.P.(IB) 1890/I&BP/MB/2018)
dated 22nd October, 2018 ("CIRP Commencement date") passed by Hon''ble National
Company Law Tribunal, Mumbai bench ("NCLT") and appointed Mr. Uliyar Balakrishna
Bhat (Registration No.: IBBI/IPA-001/IP-P00658/2017-18/11107) as Interim Resolution
Professional ("IRP") of the Company.
Subsequently, Committee of Creditors (CoC) in it''s meeting held on 20th November, 2018,
passed the resolution for the appointment of Mr. Uliyar Balakrishna Bhat as the Resolution
Professional (henceforth shall be referred as RP).
Thereafter the Company went under Liquidation vide NCLT order in MA No. 2727 /2019
IN C.P.(IB)-1890(MB)/2018 dated 18th January, 2022 in terms of the provisions of Insolvency
and Bankruptcy Code, 2016 (''IBC'') and the regulations framed thereunder.
Pursuant to the aforesaid orders and the provisions of IBC, the powers of the Board of
Directors have been suspended and such powers are vested with Mr. Uliyar Balakrishna
Bhat
2. FINANCIAL POSITION:
a. FINANCIAL RESULTS:
The Company''s performance for the Financial Year (F.Y.) ended 31st March, 2024 as
compared to the previous financial year is summarized below:
Standalone Financial Statements Summary:
(Amount in INR Lakhs)
|
Particulars |
31st March, 2024 |
31st March, 2023 |
|
Total Income |
683.82 |
2,708.82 |
|
Less: Expenses |
1328.30 |
3,050.64 |
|
Profit/ (Loss) before tax |
(644.48) |
(341.82) |
|
Prior period Expenses |
- |
6.21 |
|
Less: Provision for tax (Adjustments |
- |
0.46 |
|
Profit after Tax |
(644.48) |
(348.49) |
Consolidated Financial Statements Summary:
(Amount in INR Lakhs)
|
Particulars |
31st March, 2024 |
31st March, 2023 |
|
Total Income |
970.94 |
3,307.52 |
|
Less: Expenses |
1626.20 |
3,718.74 |
|
Profit/ (Loss) before tax |
(655.26) |
(411.22) |
|
Prior period Expenses |
- |
6.21 |
|
Less: Provision for tax (Adjustments |
0.34 |
(0.55) |
|
Profit after Tax |
(655.60) |
(416.87) |
|
Share of Net Profit / (Loss) of |
17.03 |
- |
|
Profit for the year |
(638.58) |
(416.87) |
b. OPERATIONS:
The Corporate Debtor is inter alia engaged in the business of manufacturing of Fire Fighting
Equipment (Gas based and Water based Fire Extinguishers) under the brand name NITIE,
providing Turnkey Solutions including Procurements, designing, system integration,
commissioning and installation of firefighting systems including Annual Maintenance
Contracts (AMC) for fire protection systems.
Subsequent to the Company went under Liquidation and in view of the provisions of
Section 20 of the IBC, 2016, the Liquidator is required to manage the affairs & operations of
the Company as a going concern.
During the year under review, Liquidator was in charge of the operations or the
management of the Corporate Debtor. Further, the erstwhile management and employees
associated with the Corporate Debtors at that time have been co-operative and put their
utmost efforts to gather the data / documents / information of the Company and providing
access to Liquidator into the books of account and other records of the Company for the
earlier years including for the period under review i.e. F.Y.2023-24. The accounts for the
year ended 31st March 2024 have been prepared on the basis of information / documents
made available.
There was no change in the nature of business of the Company during the year under
review.
c. DIVIDEND:
The Company was under Liquidation during the year, no dividend was recommended or
declared during / for the Financial Year ended March 31, 2024.
d. TRANSFER TO RESERVES:
No amount was transferred to the Reserves during the financial year under review.
e. REPORT ON PERFORMANCE OF SUBSIDIARIES, ASSOCIATES AND TOINT
VENTURE COMPANIES:
The Company has an investment in its wholly owned subsidiaries named Eurotech
Cylinders Private Limited ("ECPL");. Further, The Company has an associate Company
namely, Worthington Nitin Cylinders Private Limited (WNCPL).
During the year under review, there are no companies which have become Subsidiary /
Associate of the Corporate Debtors nor that the Corporate Debtor became the subsidiary /
Associate of other entity.
After due efforts of Liquidator and the erstwhile management of the Company to collect the
relevant data of Company''s Subsidiaries, Associate or Joint Venture Companies for the
purpose of identifying financial position of the Company including preparation of the
financial statements of the subsidiaries, associates and joint venture companies for the
financial year ended 31st March 2024, the Consolidated Financial statement has been
prepared and accordingly, presented in Annexure I which is ''Form AOC-1'' to this board
report.
Further, it is to be noted that as provided by promoters, the Liquidator has no access to
financial statements of subsidiary any time as they are not governed by the provisions of the
Insolvency and Bankruptcy Code, 2016.
f. DEPOSITS:
The Company has not accepted nor renewed any amount falling within the purview of
provisions of Section 73 of the Companies Act 2013 ("the Act") read with the Companies
(Acceptance of Deposit) Rules, 2014 during the year under review.
g. PARTICULARS OF CONTRACTS OR ARRANGEMENT WITH RELATED PARTIES:
All Related Party Transactions entered during the year were in Ordinary Course of the
Business and at Arm''s Length basis. During the year under review, the Company has not
entered into any contracts/ arrangements/ transactions with related parties which qualify
as material in accordance with the Policy of the Company on materiality of related party
transactions. Hence, the disclosure of Related Party Transactions as required under Section
134(3)(h) of the Companies Act, 2013 in ''Form AOC-2'' is not applicable.
The details of such related party transactions are available in the Note no. 36 to the
Standalone financial statements section of this Annual Report.
h. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN
EXCHANGE EARNINGS AND OUTGO:
The particulars as required under the provisions of Section 134(3)(m) of the Companies Act,
2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 in respect of conservation of
energy, technology absorption and foreign exchange earnings and outgo, etc. for the year
ended March 31, 2023, are furnished in ''Annexure - II'' which forms part of the Board''s
Report.
i. INVESTOR EDUCATION AND PROTECTION FUND ("IEPF"):
As per Sections 124 and 125 of the Companies Act, 2013, read with the Investor Education
and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016,
(notified on September 5, 2016) and the Investor Education and Protection Fund Authority
(Accounting, Audit, Transfer and Refund) Amendment Rules, 2016 (notified on February 28,
2017) ("IEPF Rules"), all dividends which remain unclaimed and unpaid for a period of
seven years from the date they became due for payment were required to be transferred to
the Investor Education and Protection Fund established by the Central Government.
No dividend was declared by the Company in the financial year 2016-17. Therefore, the
requirement of transfer of Unclaimed and Unpaid Dividend amount to Investor Education and
Protection Fund (''IEPF'') does not arise.
j. COST RECORDS:
During the financial year under review, the Company was required to maintain cost records as
specified by the Central Government under sub-section (1) of section 148 of the Companies Act,
2013. Despite the Liquidation proceedings initiated against the Company, during which the
powers of the management and the Board of Directors were vested in the Liquidator, significant
efforts were made to maintain the Company''s status as a Going Concern and to keep records
updated. While every effort was made by the Liquidator to comply with the requirements, there
were certain limitations in maintaining cost records as prescribed under the provisions, which
have been duly noted by the Auditors in their Audit Report.
k. PARTICULARS OF INVESTMENTS, LOANS, GUARANTEES AND SECURITIES:
Particulars of Loans, Guarantees, and Investments made, if any, under the provisions of
Section 186 of the Companies Act, 2013 read with rules made thereunder as on March 31,
2024 are set out in Notes to the Standalone Financial Statements of the Company.
l. WEBSITE AND EXTRACT OF ANNUAL RETURN:
The Company has a website; however, not updated till the end of the review period
m. DISCLOSURE UNDER SEXUAL HARASSMENT ACT:
The Company being under Liquidation during the year, the Liquidator has made efforts to
maintain the going concern status of the Company and monitoring the activities of existing
employees of the company. Further, due steps have been taken to maintain the data as
required under applicable laws and to comply with provisions of the Sexual Harassment of
Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Liquidator further
confirmed that no complaints / incidents w.r.t. Sexual Harassments occurred during the
period under review.
n. DISCLOSURES UNDER SECTION 134(3)(l) OF THE COMPANIES ACT, 2013:
The Company being under Liquidation during the year, the Liquidator is responsible for
running the Company as a Going Concern and therefore, maintaining the said status during
the period under review. Except the above and as disclosed elsewhere in this report and /
or in the financial statement read with the auditor report and other reports being part of
Directors Report for the year ended March 31, 2024, no material changes and commitments
which could affect the Company''s financial position have occurred between the end of the
financial year of the Company and date of this report.
o. DETAIL OF FRAUD AS PER AUDITORS REPORT:
The Auditors in its report has made observations / remarks w.r.t. Company''s financial
position / maintenance of data, etc. Except that the Auditors have not highlighted any
instances of Fraud happened in the Company / its operations during the period under
review.
p. SECRETARIAL STANDARDS COMPLIANCE:
The Company being under Liquidation during the year and the powers and
responsibilities of the Board of Directors and other Committees of the Company stand
suspended and vested with the Liquidator under the provisions of IBC, 2016. Therefore,
compliance with the Secretarial Standards does not arise. However, the meetings of the
Committee of Creditors along with the Liquidator are held during the year under review as
per Rules / Guidelines provided under IBC, 2016.
q. INTERNAL FINANCIAL CONTROLS:
An extract of the comment made by the Statutory Auditor in the Internal Audit report
issued by him is as placed hereunder:
âThe system of internal financial controls with reference to financial statements with regard to the
Company were not made available to us to enable us to determine if the Company has established
adequate internal financial controls with reference to financial statements and whether such internal
financial controls were operating effectively as at March 31, 2024.â
r. VIGIL MECHANISM / WHISTLE BLOWER POLICY:
The Company has framed Vigil Mechanism / Whistle Blower Policy, however the same is
not updated till the end of the review period. The Company being under Liquidation, the
operations and management of the Company are being monitored and controlled by
Liquidator in the best possible capacity within the provisions of IBC. Further, no instance
were noticed for any Whistle Blower during the year under review.
s. MANAGEMENT DISCUSSION AND ANALYSIS:
The Company being under Liquidation, the operations and management of the Company
are being monitored and controlled by Liquidator in the best possible capacity within the
provisions of IBC to maintain the status of the Company as a going concern. Therefore, the
report about Management Discussion and analysis pursuant to Company''s performance
and future prospects were not provided for the period under review.
t. CORPORATE GOVERNANCE & CERTIFICATE THEREON:
The Company is under Liquidation pursuant to the order issued by NCLT. Hence, the
operations and management of the Company are being monitored and controlled by
Liquidator in the best possible capacity within the provisions of IBC to maintain the status
of the Company as a going concern. As required, the report on Corporate Governance has
been prepared and signed by the Liquidator being part of this Annual Report as Annexure
III. The Certificate on Corporate Governance issued by AVS & Associates, Company
Secretary, Navi Mumbai, for the financial year ended March 31, 2024 is enclosed in the
report as ''Annexure - IV''.
3. MATTERS RELATED TO DIRECTORS AND KEY MANAGERIAL PERSONNEL:
a) Director liable to Retirement by Rotation:
The powers and responsibilities of the Board of Directors including independent directors
were suspended due to Liquidation order passed against the Company. Accordingly,
provisions about retirement by rotation of directors are not applicable to the Company for the
period under review.
b) Board of Directors, Independent Directors and Key Managerial Personnel:
Post the initiation of CIRP and thereafter with the passing of order for Liquidation against
the Company, the powers and responsibilities of the Board of Directors including
independent directors which was suspended and vested with Liquidator when the
Company was admitted into CIRP; the suspension of the powers of the Board and vesting of
the same with Liquidator continued with the Liquidation order. Further, during the F.Y.
2019-20 the Key Managerial Personnel including the Company Secretary cum Compliance
Officer, Chief Financial Officer, Chief Operating Officer resigned from their position.
c) Declaration by Independent Directors:
The Company was under Liquidation leading to continuance in suspension of powers of the
Board of Directors, declarations by the Independent Directors were not received by the
Company.
4. DISCLOSURES RELATED TO BOARD, COMMITTEES AND POLICIES:
a) BOARD MEETINGS:
Due to the supersession of the Board of Directors, no Board Meetings were held during the
year under review after CIRP commencement.
In continuation to the suspension of the powers of the Board of Directors of the Company,
the various Committees formed under the Companies Act and other applicable laws were
discontinued and therefore, no committee meetings were held during the period under
review.
b) COMMITTEE OF CREDITORS MEETINGS:
The Committee of Creditors (COC) of the Corporate Debtor was duly constituted under
Section 21 of the IBC read with Regulation 17 of the CIRP Regulations. Further, the
meetings of COC were duly convened and held as per provisions of Regulation 18 of the
CIRP Regulations.
c) RISK MANAGEMENT POLICY:
The Company doesn''t have an updated Risk Management Policy for the year under review.
However, the Company being under CIRP, the risks identification and mitigation,
framework & strategies are being monitored and controlled in the best possible capacity by
a Liquidator within the provisions of IBC and CIRP regulations.
5. AUDITORS AND REPORTS:
a. APPOINTMENT OF AUDITORS:
Pursuant to the provisions of Section 139 of the Companies Act, 2013 and the Companies
(Audit and Auditors) Rules, 2014, M/s. Parekh Shah & Lodha, Chartered Accountants,
(FRN: 107487W) the Statutory Auditors of the Company have been appointed to conduct
statutory audit from the financial year 2020-21 to financial year 2024-25 (both inclusive). The
Company has received eligibility certificate from the Statutory Auditor certifying that they
continue to be eligible to be the Statutory Auditor of the Company for the financial year
2023-24.
b. OBSERVATIONS OF STATUTORY AUDITORS ON ACCOUNTS FOR THE
FINANCIAL YEAR ENDED 31st MARCH, 2022:
The observations/qualifications/disclaimers made by the Statutory Auditors,
M/s. Parekh Shah & Lodha, Chartered Accountant LLP for Standalone Financial Statements
and for Consolidated Financial Statement in their report for the financial year ended 31st
March, 2023 read with the explanatory notes, formed part of respective financial statements,
are self-explanatory and therefore, do not call for any further explanation or comments from
the Liquidator under Section 134(3) of the Companies Act, 2013.
c. SECRETARIAL AUDIT:
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Liquidator
appointed M/S AVS & Associates, Practicing Company Secretaries, to undertake the
Secretarial Audit of the Company for the F.Y. 2023-24. The Secretarial Audit Report for the
financial year 2023-24 is annexed with this report as "Annexure -V".
On the basis of available data, records and details, the Secretarial Auditor''s report for the
financial year ended March 31, 2024 contains various observations and qualifications. These
remarks are self-explanatory, and as such, no further explanation or comments from the
Liquidator are warranted under Section 134(3) of the Companies Act, 2013.
d. INTERNAL AUDIT:
Being under Liquidation, the Company has not appointed any Internal Auditor for the
financial year ended 31st March 2024.
6. NOMINATION AND REMUNERATION POLICY:
Considering the Company had been admitted into CIRP and pursuant to the subsequent
Liquidation proceedings and suspension of the board of directors since the admission into
CIRP, the requirements of formulation of the Nomination & Remuneration Policy and criteria of
remuneration to board of directors and senior management is not applicable to the Company
during the period under review.
7. EVALUATION OF PERFORMANCE OF THE BOARD, ITS COMMITTEES, AND
INDIVIDUAL DIRECTORS:
The powers and responsibilities of the Board of Directors including the Committee of the Board were
suspended by virtue of the company being under CIRP followed by Liquidation and the same vested
with the Liquidator under the provisions of IBC. In view of the above, evaluation of the performance
of Directors, Board or the Committees could not be carried out and no separate meeting of
Independent Directors could be held.
8. OTHER DISCLOSURES:
Other disclosures as per provisions of Section 134 of the Act read with Companies (Accounts) Rules,
2014 are furnished as under:
a. DISCLOSURE OF ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNAL:
In F.Y. 2018-19, CIRP of the Company commenced under the terms of Chapter II of the
Insolvency and Bankruptcy Code, 2016 (IBC) vide the order (C.P.(IB)
1890/I&BP/MB/2018) dated 22nd October, 2018 ("CIRP Commencement date") passed
by Hon''ble National Company Law Tribunal, Mumbai bench ("NCLT") and NCLT
appointed Mr. Uliyar Balakrishna Bhat (Registration No.: IBBI/IPA-001/IP-
P00658/2017-18/11107) as Interim Resolution Professional ("IRP") of the Company.
Subsequently, Committee of Creditors (CoC) in its meeting held on 20th November, 2018,
passed the resolution for appointment of Mr. Uliyar Balakrishna Bhat as the Resolution
Professional.
Thereafter Liquidation order was passed against the Company vide NCLT order in MA
No. 2727 /2019 IN C.P.(IB)-1890(MB)/2018 dated 18* January, 2022 in terms of the
provisions of Insolvency and Bankruptcy Code, 2016 (''IBC'') and the regulations framed
thereunder.
Pursuant to the aforesaid orders and the provisions of IBC, the powers of the Board of
Directors have been suspended and such powers are vested with Mr. Uliyar Balakrishna
Bhat in the capacity of a Liquidator.
In addition to the above, BSE Limited had issued notice dated 09th February, 2022
suspending the trading in equity shares of the company with effect from 11th
February, 2022. Further, National Stock Exchange of India Limited, has also
communicated to the Company about suspension in trading of equity shares of the
Company with effect from same date.
b. DIRECTOR''S RESPONSIBILITY STATEMENT:
The powers of the Board of Directors were suspended by the virtue of the company being
under CIRP and thereafter the Liquidation order. Hence, no director''s responsibility
statement is declared in this report for the year under review.
c. DISCLOSURE UNDER SECTION 43(a)(ii) OF THE COMPANIES ACT, 2013:
The Company has not issued any shares with differential rights and therefore no
information as per provisions of Section 43(a)(ii) of the Act read with Rule 4(4) of the
Companies (Share Capital and Debenture) Rules, 2014 is furnished.
d. DISCLOSURE UNDER SECTION 54(1)(d) OF THE COMPANIES ACT, 2013:
The Company has not issued any sweat equity shares during the year under review.
Therefore, no information as per provisions of Section 54(1)(d) of the Act read with Rule
8(13) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished.
e. DISCLOSURE UNDER SECTION 62(1)(b) OF THE COMPANIES ACT,2013:
The Company has not issued any equity shares under Employees Stock Option Scheme
during the year under review. Therefore, no information as per provisions of Section
62(1)(b) of the Act read with Rule 12(9) of the Companies (Share Capital and Debenture)
Rules, 2014 is furnished.
f. DISCLOSURE UNDER SECTION 67(3) OF THE COMPANIES ACT,2013:
During the year under review, there were no instances of non-exercising of voting rights in
respect of shares purchased directly by employees under a scheme pursuant to Section 67(3)
of the Act read with Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014.
g. HUMAN RESOURCES MANAGEMENT AND MANAGERIAL REMUNERATION:
Pursuant to the initiation of CIRP, the powers of the Board of Directors were suspended. In
the absence of Top-Level Management, including Managerial Personnel, no managerial
remuneration was payable to any directors or managerial personnel during the year under
review. While a few employees continued to remain associated with the Company post¬
initiation of the CIRP process, the absence of managerial remuneration eliminated the
requirement for disclosures under Section 197 of the Companies Act, 2013, and the rules
made thereunder. Consequently, particulars of remuneration to Directors and employees, as
well as the ratio of remuneration of each director to the median employee''s remuneration,
were not provided in this report.
9. ACKNOWLEDGEMENTS:
Liquidator takes this opportunity to thank the continuing employees post this CIRP process and
the subsequent Liquidation order, the members of the Committee of Creditors and other
professionals for their consistent support to run the Company as a Going Concern during the
process of CIRP and also post passing of the Liquidation order.
For and on behalf of the (Suspended) Board of
Nitin Fire Protection Industries Limited
Sd/-
Uliyar Balakrishna Bhat
Resolution Professional in the matter of
Nitin Fire Protection Industries Limited
(Registration No.: IBBI/PA-001/IP-P00658/2017-18/11107)
Communication Address
A-005, Ground Floor, Western Edge II,
Off Western Express Highway, Borivali (East),
Mumbai - 400 066
Email: liquidation.nfpil@gmail.com
Date : 21/01/2025
Place : Mumbai
Mar 31, 2014
Dear Members,
The Directors have pleasure in presenting the Nineteenth Annual Report
together with the Audited Statement of Accounts for the year ended
March 31, 2014.
FINANCIAL RESULTS
Accounting Policy
The Company follows the Generally Accepted Accounting Principles (GAAP)
in India applicable accounting standards/provisions of the Companies
Act, 1956, for the preparation of its financial statements. The Company
also follows accrual basis of accounting except in cases of revaluation
of assets and impairment, if any.
Summarised Profit and Loss Statement (Rs. in lacs)
Particulars Standalone Consolidated
For the For the For the For the
year year year year
2013-14 2012-13 2013-14 2012-13
Sales & other income 45664.73 36286.29 101801.70 72293.54
Profit before depreciation,
amortization & tax 1496.09 2325.18 8014.83 7099.74
Depreciation/amortization 116.20 105.01 1058.64 473.16
Profit before tax 1379.89 2220.17 6956.19 6626.58
Provision for income tax
including deferred tax &
wealth tax 241.18 446.34 263.49 469.93
Tax adjustments of earlier
years (net) 41.14 19.98 40.29 19.98
Profit aftertax 1097.57 1753.85 6652.41 6136.68
Add: Share of (loss)/profit
in an associate - - - (435.98)
Profit brought forward from
previous year 4893.93 3656.15 21020.03 15835.41
Profit available for
appropriation 5991.50 5410.00 27672.44 21536.11
APPROPRIATIONS
Transferred to General Reserve - - - -
Proposed dividend 438.41 441.10 438.41 441.10
Corporate dividend tax on
proposed dividend 74.51 74.97 74.51 74.97
Surplus carried forward to
Balance Sheet 5478.58 4893.93 27159.52 21020.03
DIVIDEND
The Board of Directors encouraged with the above financial performance
of the Company recommends dividend of Rs. 0.20/- per share on
21,92,06,111 Equity Shares of Rs. 2/- each (Previous year Rs. 0.20/-
per share on 22,05,52,694 Equity Shares of Rs. 2/- each).
BUY-BACK OF SHARES
During the year under review, pursuant to approval of the Board of
Directors of the Company, for buy-back of shares under section 77A of
the Companies Act, 1956, upto 10% of the paid-up equity share capital
and free reserves of the Company, the Company has bought back 13,46,583
fully paid up equity shares of the Company through open market
transactions for an amount of Rs. 7,69,86,186/- by utilizing Securities
Premium Account to the extent of Rs. 7,42,93,020/- and the Company has
not allotted any shares and there is no change in the Authorized Share
Capital of the Company.
TRANSFER TO RESERVES
The Board has not recommended the divided exceeding 10% of the face
value of the equity share. As per the Companies (Transfer of Profits to
Reserves) Rules, 1975, the Company has not proposed to transfer its
profit to the General Reserve out of the amount available for
appropriation and an amount of Rs. 5,478.58 Lacs proposed to be
retained in the Statement of Profit and Loss.
RESERVE AND SURPLUS
Total Reserves and Surplus stood at Rs. 10465.84 lacs as at March 31,
2014, compared to Rs. 10631.13 lacs as at March 31, 2013.
OPERATION RESULTS AND BUSINESS
The Company continued to see strong and profitable growth in the
Financial Year 2013-14 across all markets driven by good performance
across all business segments.
The performance of your Company during the year under report has
registered an improvement over the previous year. Total income during
the year ended March 31, 2014, stood at Rs. 45664.73 lacs registering
an increase of 25.84% as compared to the previous year. As per the
Consolidated Financial Statements total income was Rs. 101801.71 lacs
registering an increase of 40.82% as compared to the previous year. The
working of the Company is considered satisfactory. Barring unforeseen
circumstances, the Board of Directors are hopeful of better performance
of the Company during the current year.
The Company is among the leading fire fighting equipment manufacturing
companies in India and continues to retain its leadership position
among the Indian companies. It has continued to win new engagements and
grow existing relationships in the traditional area of development
manufacturing and distribution of fire protection and electronic
security systems, CNG cascades commissioning and installation of safety
and security solutions and execution of annual maintenance contracts
for fire protection systems. It provides automated water and gas based
fire suppression systems along with fire detection and security systems
on turnkey basis. The broad range of products and services enables the
Company to provide "end -to-end" services to its customers combined
with its industry focus and its geographical spread, the Company is
able to provide comprehensive and high value added services to its
customers. Considering the need to deepen relationships with customers
in the industry to acquire new customers in the markets where your
Company is already a significant force and to expand in emerging
markets.
Cost Audit Report
As per section 233B of the Companies Act, 1956 and subject to the
approval of the Central Government, the Company has appointed Mr.
Vinayak B. Kulkarni, Practising Cost Accountant, Mumbai, as the cost
auditor of the company to conduct audit of cost accounting records
maintained by the Company for product(s)/Services covered under MCA
Cost Audit Order(s) for the year ending on March 31, 2014.
SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS
During the year 2012-13, the Company has formed two wholly owned
subsidiaries viz. Nitin Fire Protection Systems Private Limited and
Nitin Fire Protection Appliances Private Limited. Since the said
subsidiaries has not carried out any business activities during the
financial year 2013-14, the Board of Directors of the said Companies
has decided to apply the Registrar of Companies under section 560 of
the Companies Act, 1956 (Proposed Section 248 of the Companies Act,
2013), declaring the said Companies as defunct companies.
Now, your Company has three subsidiaries namely (1) Eurotech Cylinders
Private Limited, India (2) Nitin Venture FZE, UAE including its
subsidiary New Age LLC, UAE and Firetec Systems Limited, UK , and (3)
Nitin Global Pte Limited, Singapore.
We believe that the presentation of the Consolidated Financial
Statement presents a more comprehensive picture rather than the
Standalone Financial Statements of the Company and each of its
subsidiaries.
However, summary of financial information of each subsidiary regarding
Capital Reserves, Total Assets, Total Liabilities, Details of
Investment, Turnover, Profit before Taxation, Provision for Taxation
Profit after tax and Proposed Dividend have been separately furnished
forming part of this Annual Report.
Eurotech Cylinders Private Limited, India (ECPL)
ECPL is in the business of purchase and supply of high pressure
seamless/compressed natural gas cylinders (CNG) and valves. The
Company''s products are sold under the brand name ''EURO'' and basically
cater to domestic markets. ECPL supplies the above products to dealers
of industrial/medical gases, fire fighting equipments, CNG-NGV
vehicles, CNG Cascades etc.
Nitin Venture, FZE, UAE (NV)
NV is set up in the free trade zone at Jebel Ali, Dubai, to meet the
demands of the international customers and providing simple standalone
conventional to intelligent integrated fire protection solutions backed
by a product portfolio consisting of complete spectrum of fire and
safety products with international approvals. NV is strategically
placed to be an international one stop source to discerning customers
for conventional to intelligent standalone/integrated fire detection
systems, water and gas based fire extinguishing systems, gas detection
systems, CCTV access control & intrusion detection systems, high
pressure storage cylinders & accessories and integrated building
management systems.
Firetec Systems Limited, UK
FSL (Firetec Systems Ltd.) was launched at the 2013 Firex exhibition in
Birmingham with great success. Our fledgling organisation, backed by a
long-standing international specialist company, aims to set itself
apart from competitors in gaseous suppression systems by providing a
more flexible, personal service and higher level of customer care. FSL
brings a fresh outlook to the market place and wish to utilise
available technology in order to make life easier for customers;
whether that be through an online BOM & quote generator, large file
share or quotation storage. FSL is positioning itself as the
independent option for trade organisations seeking gaseous suppression
systems.
New Age LLC, UAE (NA)
New Age LLC ("NA"), UAE was established in 1976 at UAE. NA has got
office and representation in all seven Emirates.
NA is a Professional Fire Protection Engineering Company providing
Equipments, Fire Protection System, Fire Detection System, Emergency
Lighting System and Water Mist Fire Protection Systems.
NA has taken several projects like Municipality, Airport Development
Board, Port Authority, Telecommunication Sites, Cement Plants, Ministry
of Education and Civil Defense. NA has also got Major Overseas
License(s) along with Local License with staff over 140 personnel
directly employed by the Company.
Nitin Global Pte Limited, Singapore (NGPL)
NGPL was incorporated in July, 2009, to meet the demands of South-East
Asian market and for providing simple standalone conventional to
intelligent integrated fire protection solutions backed by a product
portfolio consisting of complete spectrum of fire and safety products
with international approvals. NGPL is strategically placed to be an
international one stop source to discerning customers for conventional
to intelligent standalone / integrated fire detection systems, water
and gas based fire extinguishing systems, gas detection systems, CCTV
access control & intrusion detection systems, high pressure storage
cylinders & accessories and integrated building management systems.
There has been no other material change in the nature of the business
of the subsidiaries. A statement containing brief financial details of
the subsidiaries is included in the Annual Report.
ANNUAL REPORT OF SUBSIDIARY COMPANIES
In terms of general exemption given by the Ministry of Corporate
Affairs, Government of India, vide General Circular No. 2/2011 dated
February 8, 2011, under section 212(8) of the Companies Act, 1956, a
copy of Audited Balance Sheet, Audited Statement of Profit and Loss,
Report of the Board of Directors and the Auditors of the above
mentioned five subsidiary companies for the year ended March 31, 2014,
have not been attached with the Annual Report of the Company. We
believe that the presentation of the Audited Consolidated Financial
Statements present a true and fair picture of the state of affairs and
the financial conditions.
The Company has also annexed a statement at the end of this Annual
Report pursuant to general exemption granted by the Ministry of
Corporate Affairs, Government of India, under section 212(8) of the
Companies Act, 1956, related to its subsidiary companies for the year
ended March 31, 2014.
The Company shall make available these documents/details upon request
by any shareholder of the Company interested in obtaining the same.
The Annual Accounts of the Company and its subsidiary companies are
also available for inspection by the shareholders during business hours
at the registered office of the Company.
CONSOLIDATED FINANCIAL STATEMENTS
Consolidated Financial Statements have been prepared in accordance with
the Accounting Standard 21, ''Accounting Standard 27 ''Financial
Reporting of Interest in Joint Ventures'' for previous year, the Company
has followed the Accounting Standard 23, Accounting for Investments in
Associates in Consolidated Financial Statements'', your Directors have
pleasure in attaching the Consolidated Financial Statements which form
part of the Annual Report.
FIXED DEPOSITS
The Company has not invited/accepted any public deposits and as such,
no amount on account of principal or interest on public deposits was
outstanding on the date of the Balance Sheet.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Mr. Nitin M. Shah (DIN - 00073232) shall retire by rotation at the
forthcoming Annual General Meeting of the Company and being eligible
offers himself for reappointment.
Changes in Independent Directors
Dr. Surendra A. Dave, Independent Director, has resigned from the
directorship of the Company w.e.f. February 18, 2014.
As per the provisions of Section 149 of the Companies Act, 2013 ("the
Act"), which has come into force with effect from April 1, 2014, an
Independent Director shall hold office for a term up to five
consecutive years on the Board of a company and is not liable to retire
by rotation. In compliance with the provisions of Section 149 read with
Schedule IV of the Act, the appointment of Mr. Ramakant M. Nayak, Mr.
Krishnakant Jha and Mr. S. K. Dheri as Independent Directors is being
placed before the Members in the ensuing Annual General Meeting for
their approval. The Company has received necessary declaration from all
the three Independent Directors to the effect to the Board that they
meet the criteria of independence as provided under Section 149 (6) of
the Act. In the opinion of the Board, they fulfill the conditions
specified in the Act and the Rules made there under for the appointment
as Independent Directors and are independent of the management. Members
are requested to refer to the Notice of the Annual General Meeting and
the Explanatory Statement for details of the qualifications and
experience of the Directors and the period of their appointment. The
Board recommends the passing of the Resolutions at Item Nos. 5 to 7 of
the Notice of the Annual General Meeting. The Company will post the
detailed profile of the above mentioned Independent Directors on the
website of the Company shortly. Brief particulars and expertise of
these Directors have been given in the Report on the Corporate
Governance and in the Notice of the ensuing Annual General Meeting.
Changes in Key Managerial Personnel
Pursuant to Section 203 of the Companies Act, 2013, the Company has
appointed Mr. Nitin M. Shah, Managing Director and Mr. Kamlesh Gandhi
as the Chief Financial Officer and Mr. Abhishek Shrivastava, Company
Secretary, all as Key Managerial Personnel of the Company w.e.f. May 17
2014.
Mr. Nitin M. Shah has resigned from the post of Managing Director and
also as Key Managerial Personnel of the Company w.e.f. May 17, 2014.
However, he will continue as Director and Non-Executive Chairman of the
Company.
Mr. Rahul N. Shah has resigned from the directorship of the Company
w.e.f. May 17, 2014.
Mr. Kunal N. Shah was appointed as an Executive Director of the Company
w.e.f. April 1, 2014 and he has resigned from the directorship of the
Company w.e.f. May 17, 2014.
Mr. Rahul N. Shah is appointed as an additional director of the Company
and also as Whole-time Director and Key Managerial Personnel of the
Company on August 14, 2014, for a term of three years. The Company has
received a notice from a member proposing his candidature as a director
of the Company along with deposit of requisite amount under section 160
of the provisions of the Companies Act, 2013. Mr. Rahul N. Shah is not
disqualified from being appointed as director in terms of section 164
of the Act and has given his consent to act as a Director, Whole-time
Director and Key Managerial Personnel of the Company. Mr. Rahul N.
Shah, Whole-time Director, look after all plants manufacturing
/production and marketing in India. He also looks after Finance and
statutory compliances of the company. The Board recommends resolution
No. 8 & 9 for the approval of the members.
Mr. Kunal N Shah is appointed as an additional director of the Company
and also as Whole-time Director of the Company on August 14, 2014 for a
term of three years. The Company has received a notice from a member
proposing his candidature as a director of the Company along with
deposit of requisite amount under section 160 of the provisions of the
Companies Act, 2013. Mr. Kunal N. Shah has given his consent to act as
a director and whole-time director of the Company. Mr. Kunal N. Shah,
Whole-time Director look after all plants manufacturing /production and
marketing in India. He also looks after Finance and statutory
compliances of the company. The Board recommends resolution No. 10 & 11
for the approval of the members.
ADOPTION OF VARIOUS POLICIES OF THE COMPANY
The Board of Directors of the Company has approved and adopted the
following policies during the period from April 1, 2014 till August 14,
2014:
1) Related party transactions policy pursuant to Section 188 of the
Companies Act, 2013
2) Vigil mechanism policy pursuant to Section 177 of the Companies Act,
2013
3) Remuneration policy pursuant to Section 178 of the Companies Act,
2013
4) Corporate Social Responsibility policy pursuant to Section 135 of
the Companies Act, 2013
WEBSITE OF THE COMPANY:
The Company agrees to post the following details on the website of the
Company viz. www.nitinfire.com:
* Establishment of Whistle Blower Policy & Vigil Mechanism & Related
Part Transaction Policy & Remuneration Policy including the evaluation
criteria
* Letter of resignation(s) with the detailed reasons of resignation
* Letter of appointment of the Independent Directors
INSURANCE
The properties of the Company viz. building, plant and machinery and
stocks have been adequately insured.
EMPLOYEES
Employee''s relations remained cordial during the year under review.
Particulars of employees as required under Section 217(2A) of the
Companies Act, 1956, read with the Companies (Particulars of Employees)
Rules, 1975, as amended and forming part of the Directors'' Report for
the year ended March 31, 2014, are as under:
Name Age Designation & Remuneration
Nature of duties Received (Rs.)
Nitin M. 57 Chairman and Managing Director 1,32,48,000/-
Shah (*) (Managing day to day activities
and Engineering business development
activities)
Partho Roy 48 Director-Marketing 66,00,000/-
(Responsible for Marketing on all
Computer India basis Marketing for
fire safety Science systems)
Name Qualification Experience Date of Particulars of
(in years) commencement pervious
of employment employers
Nitin M. Diploma in 38 March 16, 2006 None
Shah(* Mechanical
Engineering
Partho Roy Bachelor in 28 December 1, 2012 New Age
Computer LLC, UAE
Science
(*) Relatives of Mr. Rahul N. Shah & Mr. Kunal N Shah, Directors of the
Company and Mr. Nitin M. Shah has resigned from the post of the
Managing Directorship, but, continue to act as a Director and
Non-Executive Chairman w.e.f. May 17, 2014
INTERNAL CONTROL SYSTEMS AND ITS ADEQUACY
The Company has adequate internal control systems and procedures in
place for effective and smooth conduct of business and to meet
exigencies of operation and growth. The key business processes have
been documented. The transactions are recorded and reported in
conformity with generally accepted accounting practices. The Company
has an in house internal audit system and procedures to ensure
reliability of financial reporting compliance with the Company''s
policies and practices governmental regulations and statutes.
INTERNAL AUDITOR
Pursuant to Section 138 of the Companies Act, 2013, read with the
Clause 49 of the Listing Agreements with Stock Exchanges, the Company
has appointed M/s Tolia and Associates, Chartered Accountants (Firm
Registration Number:111017W) as the Internal Auditor of the company for
the financial year 2013-14 and also appointed them for the financial
year 2014-15.
RISK AND CONCERNS
Indian Economy has been on a growth track again. The growth is expected
to accelerate during the current year. However, excess liquidity and
inflation induced by supply constraints and anxiety about the eventual
withdrawal of stimulus continue to cause concern. The Company had
reported good growth in the Financial Year''s 2012-13 and 2013-14.
The Management continues to monitor the risks concerning the Company
and take actions as appropriate to the situation.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars relating to energy conservation, technology absorption,
foreign exchange earnings and outgo as required to be disclosed under
Section 217(1)(e) of the Companies Act, 1956, read with the Companies
(Disclosure of Particulars in the Report of Board of Directors)
Rules,1988, are provided in annexure to this Report.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to the Directors'' Responsibility Statement the
Directors confirm that:
i. In the preparation of the annual accounts for the Financial Year
ended March 31, 2014, the applicable accounting standards have been
followed and no material departures have been made from the same;
ii. Appropriate accounting policies have been selected and applied
consistently and have 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 as at March 31, 2014 and of the Profit for that period;
iii. Proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
iv. The annual accounts have been prepared on a going concern basis.
AUDITORS
The Auditors of the Company M/s. Haribhakti & Co. LLP (converted on
June 17, 2014 from a firm M/s. Haribhakti & Co.) (FRN - 103523W) retire
at the conclusion of the ensuing Annual General meeting of the Company
and being eligible, offer themselves for re-appointment as statutory
auditors for the Financial Year 2014-2015.
The Company has received a letter from M/s. Haribhakti & Co. LLP,
Chartered Accountants, to the effect that their appointment, if made,
would be within the prescribed limits under Section 141 of the
Companies Act, 2013 and that they are not disqualified within the
meaning of Section 141 of the said Act.
Members are requested to consider their appointment on a remuneration
to be decided by the Board of Directors thereof for the ensuing
Financial Year i.e. 2014-2015.
AUDITOR''S REPORT
The Board has duly examined the statutory Auditor''s Report to the
financial statements and clarifications wherever necessary have been
included in the Notes to the Financial Statements section of the Annual
Report.
EXPLANATION TO THE AUDITORS OBSERVATION:
Reply to qualification given by the auditors in the Standalone Auditors
Report:
Auditors Qualification: Para (A) of the Auditors Report: As more fully
explained in Note No 34 to the notes to the financial statements, no
provision has been made by the Company in respect of its dispute with a
bank for claim made by the bank for Rs. 50,133,481/- on a derivative
contract entered into by its erstwhile subsidiary (now an associate),
the liability for which has been taken over by the Company. The Company
has not determined the quantum of mark to market losses as of the
balance sheet date on the above contract and have relied on a legal
opinion in the matter wherein, no liability is expected. Pending final
settlement of the matter, we are unable to quantify the extent of
provision required, if any, in this regard.
Managements Reply: Consequent to part sale of equity stake in an
erstwhile subsidiary in December, 2010, the Company has taken over an
outstanding claim of a derivative contract amounting to Rs. 501.33 Lacs
(excluding interest). Based on a legal opinion the Company has filed a
petition in the Hon''ble High Court of Bombay challenging the legality
of the contract. Pending decision, no provision is made in the books of
account for this claim.
Auditors Qualification: Para (B) of the Auditors Report: As more fully
explained in Note No. 41 to the Notes to the Financial Statements
provisions of Rs. 4,50,000/- has been made for penalty towards
compounding of offence petition filed for the alleged non-compliance of
several provisions of the Act before Ministry of Corporate Affairs.
Based on opinion obtained, the Company expects maximum penalty Rs.
450000/- on disposal of its petitions. Pending disposal of petition, we
are unable to quantify the extent of additional provision required if
any in this regard.
Management Reply:
The Company has filed the requisite applications with the Ministry of
Corporate Affairs (the MCA) for compounding for non-compliance of few
sections of the Companies Act, 1956 on 28th January, 2013, 30th
January, 2013, 2nd February, 2013, 11th February, 2013 & 11th April,
2013 and same has been compounded.
Further, the Company has filed the requisite applications with the
Ministry of Corporate Affairs (the MCA) for compounding for
non-compliance of few sections of the Companies Act, 1956 on February
27, 2014, January 31, 2014 and January 24, 2014. The Company is waiting
for hearing from the MCA.
Reply to qualification given by the auditors in the Consolidated
Auditors Report:
Auditors Qualification: Para (A) of the Auditors Report: As more
clarified in Note no. 36 to the notes to the Consolidated Financial
Statements, no provision has been made by the Company in respect of its
dispute with a bank for a claim made by the bank for Rs. 50,133,481 on
a derivative contract entered into by its erstwhile subsidiary (now an
associate), the liability for which has been taken over by the Company.
The Company has not determined the quantum of mark to market losses as
of the Balance Sheet date on the above contract and have relied on a
legal opinion in the matter wherein no liability is expected. Pending
the final settlement of the matter, we are unable to quantify the
extent of provision required, if any in this regard.
Managements Reply: Consequent to part sale of equity stake in an
erstwhile subsidiary in December, 2010, the Company has taken over an
outstanding claim of a derivative contract amounting to Rs. 501.33 Lacs
(excluding interest). Based on a legal opinion, the Company has filed a
petition in the Hon''ble High Court of Bombay challenging the legality
of the contract. Pending decision, no provision is made in the books of
account for this claim.
Auditors Qualification: Para (B) of the Auditors Report: As more
clarified in Note no. 37 to the notes to the Consolidated Financial
Statements, provision of Rs. 4,50,000 has been made for penalty towards
compounding of offence petitions filed for the alleged non-compliance
of several provisions of the Act before Ministry of Finance, Department
of Company Affairs. Based on opinion obtained, the Company expects
maximum penalty of Rs. 4,50,000 on disposal of its petitions. Pending
disposal of petition, we are unable to quantify the extent of
additional provision required, if any, in this regard.
Management reply:
The Company has filed the requisite applications with the Ministry of
Corporate Affairs (the MCA) for compounding for non-compliance of few
sections of the Companies Act, 1956 on 28th January, 2013, 30th
January, 2013, 2nd February, 2013, 11th February, 2013 & 11th April,
2013 and same has been compounded.
Further, the Company has filed the requisite applications with the
Ministry of Corporate Affairs (the MCA) for compounding for
non-compliance of few sections of the Companies Act, 1956 on February
27, 2014, January 31, 2014 and January 24, 2014. The Company is waiting
for hearing from the MCA.
MANAGEMENT DISCUSSION AND ANALYSIS
A Report on Management Discussion and Analysis is annexed and same
forms part of this Report.
CORPORATE GOVERNANCE REPORT
The Company has adopted the best possible Corporate Governance norms
and it has been our endeavor to comply and upgrade to the changing
norms.
A separate section on corporate governance and a certificate from the
Practicing Company Secretary regarding compliance of conditions of
Corporate Governance as stipulated under the Clause 49 of the Listing
Agreement with the stock exchanges form part of this Report.
In terms of sub-clause (v) of the Clause 49 of the Listing Agreement, a
certificate of the Chairman & Director, inter alia, confirming the
correctness of the financial statements adequacy of the internal
control measures and reporting to matters to the Audit Committee in
terms of the said Clause is also enclosed as a part of this Report.
ACKNOWLEDGMENTS
The Board acknowledges with appreciation the efforts put in by its
employees during the year under review. The Company is grateful to its
customers, shareholders, suppliers, financial institutions, bankers,
Central and State Governments for their constant support to the Company
The Directors also place on record their deep appreciation of the
contribution made by employees at all levels the consistent growth of
the Company was made possible by their hard work, loyalty, dedication,
co-ordination and support.
For and on behalf of the Board
Sd/-
Mumbai Nitin M Shah
August 14, 2014 Chairman & Director
Mar 31, 2013
To the Members of Nitin Fire Protection Industries Limited
The Directors have pleasure in presenting the Eighteenth Annual Report
together with the Audited Statement of Accounts for the year ended
March 31, 2013.
FINANCIAL RESULTS
Accounting Policy
The Company follows the Generally Accepted Accounting Principles (GAAP)
in India, applicable accounting standards/provisions of the Companies
Act, 1956 for the preparation of its financial statements. The Company
also follows accrual basis of accounting except in cases of revaluation
of assets and impairment, if any.
Summarised Profit and Loss Statement (Rs. in lacs)
Particulars Standalone Consolidated
For the year For the year For the year For the year
2012-13 2011-12 2012-13 2011-12
Sales & other
income 36286.79 16535.44 72293.54 53906.88
Profit before
depreciation,
amortization & tax 2325.18 1358.33 7099.74 5378.52
Depreciation/
amortization 105.01 99.75 473.16 296.88
Profit before tax 2220.17 1258.58 6626.58 5081.64
Provision for
income tax
including deferred
tax & wealth tax 446.34 253.88 469.93 373.97
Tax adjustments of
earlier years (net) 19.98 -0.83 19.98 3.20
Profit after tax 1753.85 1005.53 6136.68 4704.47
Less: Share of
Minority Interest
in income - - - -
Add: Share of
(loss)/profit in
an associate - - -435.98 -302.75
Profit brought
forward from
previous year 3656.15 3822.35 21536.11 13862.12
Surplus on
Amalgamation - -66.41 - -1323.10
Profit available
for appropriation 5410.00 4761.47 21536.11 16940.75
APPROPRIATIONS
Transferred to
General Reserve - 80.00 - 80.00
Proposed dividend 441.10 882.21 441.10 882.21
Corporate dividend
tax on proposed
dividend 74.97 143.12 74.97 143.12
Surplus carried
forward to Balance
Sheet 4893.93 3 656.15 21020.03 15835.41
DIVIDEND
The Board of Directors encouraged with the above financial performance
of the Company, recommends dividend of Rs. 0.20/- per share on
22,05,52,694 Equity Shares of Rs. 2/- each (Previous year Rs. 0.40/-
per share on 22,05,52,694 Equity Shares of Rs. 2/- each).
SHARE CAPITAL
During the year, Company has not allotted any share and not changed its
Authorized Capital.
TRANSFER TO RESERVES
The Board has not recommended the divided exceeding 10% of the face
value of the equity share. As per Companies (Transfer of Profits to
Reserves) Rules, 1975, the Company has not proposes to transfer its
profit to the General Reserve out of the amount available for
appropriations and an amount of Rs. 4893.92 lacs is proposed to be
retained in the Profit and Loss Account.
RESERVE AND SURPLUS
Total Reserves and Surplus stood at Rs. 10631.13 lacs as at March 31,
2013 compared to Rs. 9401.47 lacs as at March 31, 2012. The increase
was due to retained earnings.
OPERATION RESULTS AND BUSINESS
The Company continued to see strong and profitable growth in the
Financial Year 2012-13 across all markets driven by good performance
across all business segments.
The performance of your Company during the year under report has
registered an improvement over the previous year. Total income during
the year ended March 31, 2013 stood at Rs. 36286.79 lacs registering an
increase of 119.45% as compared to the previous year. As per the
Consolidated Financial Statements, total income was Rs. 72293.54 lacs
registering an increase of 34.11% as compared to the previous year. The
working of the Company is considered satisfactory. Barring unforeseen
circumstances, the Board of Directors are hopeful of better performance
of the Company during the current year.
The Company is among the leading fire fighting equipment manufacturing
companies in India and continues to retain its leadership position
among the Indian companies. It has continued to win new engagements and
grow existing relationships in the traditional area of development,
manufacturing and distribution of fire protection and electronic
security systems, CNG cascades, commissioning and installation of
safety and security solutions and execution of annual maintenance
contracts for fire protection systems. It provides automated water and
gas based fire suppression systems along with fire detection and
security systems on turnkey basis. The broad range of products and
services enables the Company to provide "end -to-end" services to
its customers, combined with its industry focus and its geographical
spread, the Company is able to provide comprehensive and high value
added services to its customers. Considering the need to deepen
relationships with customers in the industry, to acquire new customers
in the markets where your Company is already a significant force and to
expand in emerging markets.
Cost Audit Report
As per section 233B of the Companies Act, 1956 and subject to the
approval ofthe Central Government, the Company has appointed Mr.
Vinayak B. Kulkarni, Practising Cost Accountant, as the cost auditor of
the company to conduct audit of cost accounting records maintained by
the Company for product(s)/Services covered under MCA Cost Audit
Order(s) for the year ending on March 31, 2013.
SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS
During the year 2012-13, the Company has formed two wholly owned
subsidiaries viz. Nitin Fire Protection Systems Private Limited and
Nitin Fire Protection Appliances Private Limited. Since, the said
subsidiaries has not carried out any business activities during the
financial year 2012- 13, the Board of Directors of the said Companies
has decided to apply the Registrar of Companies under section 560 of
the Companies Act, 1956, declaring the said Companies as defunct
companies.
Now, your Company has three subsidiaries, namely, Eurotech Cylinders
Private Limited, India, Nitin Venture FZE, UAE including its subsidiary
New Age LLC, UAE and Nitin Global Pte Limited, Singapore.
We believe that the presentation of the Consolidated Financial
Statement presents a more comprehensive picture rather than the
Standalone Financial Statements ofthe Company and each of its
subsidiaries.
However, a summary of financial information of each subsidiary
regarding Capital, Reserves, Total Assets, Total Liabilities, Details
of Investment, Turnover, Profit before Taxation, Provision for
Taxation, Profit after tax and Proposed Dividend have been separately
furnished forming part of this Annual Report.
Eurotech Cylinders Private Limited, India (ECPL)
ECPL is in the business of purchase and supply of high pressure
seamless/compressed natural gas cylinders (CNG) and valves. The
Company''s products are sold under the brand name ''EURO'' and basically
cater to domestic markets. ECPL supplies the above products to dealers
of industrial/medical gases, fire fighting equipments, CNG-NGV
vehicles, CNG Cascades etc.
Nitin Venture FZE, UAE (NV)
NV is set up in the free trade zone at Jebel Ali, Dubai to meet the
demands of international customers and providing simple, standalone
conventional to intelligent, integrated fire protection solutions
backed by a product portfolio consisting of complete spectrum of fire
and safety products with international approvals. NV is strategically
placed to be an international one stop source to discerning customers
for conventional to intelligent standalone/integrated fire detection
systems, water and gas based fire extinguishing systems, gas detection
systems, CCTV, access control & intrusion detection systems, high
pressure storage cylinders & accessories and integrated building
management systems.
New Age LLC, UAE (NA)
New Age LLC ("NA"), UAE was established in 1976 at UAE. NA has got
office and representation in all seven Emirates.
NA is Professional Fire Protection Engineering Company providing
Equipments, Fire Protection System, Fire Detection System, Emergency
Lighting System and Water Mist Fire Protection Systems.
NA has taken several projects like Municipality, Airport Development
Board, Port Authority, Telecommunication Sites, Cement Plants, Ministry
of Education and Civil Defense. NA has also got Major Overseas License
along with Local License with staff over 140 personnel directly
employed by the Company.
Nitin Global Pte Limited, Singapore (NGPL)
NGPL was incorporated in July 2009 to meet the demands of South-East
Asian market and for providing simple, standalone conventional to
intelligent, integrated fire protection solutions backed by a product
portfolio consisting of complete spectrum of fire and safety products
with international approvals. NGPL is strategically placed to be an
international one stop source to discerning customers for conventional
to intelligent standalone / integrated fire detection systems, water
and gas based fire extinguishing systems, gas detection systems, CCTV,
access control & intrusion detection systems, high pressure storage
cylinders & accessories and integrated building management systems.
There has been no other material change in the nature of the business
of the subsidiaries. A statement containing brief financial details of
the subsidiaries is included in the Annual Report.
ANNUAL REPORT OF SUBSIDIARY COMPANIES
In terms of general exemption given by the Ministry of Corporate
Affairs, Government of India, vide General Circular No. 2/2011 dated
February 8, 2011 under section 212(8) of the Companies Act, 1956, a
copy of Balance Sheet, Profit and Loss Account, Report of the Board of
Directors and the Auditors of the above mentioned three subsidiary
companies for the year ended March 31, 2013 have not been attached with
the Annual Report of the Company. We believe that the presentation of
the Audited Consolidated Financials present a true and fair picture of
the state of affairs and the financial conditions.
The Company has also annexed a statement at the end of this Annual
Report pursuant to general exemption granted given by the Ministry of
Corporate Affairs, Government of India under section 212(8) of the
Companies Act, 1956, related to its subsidiary companies for the year
ended March 31, 2013.
The Company shall make available these documents/details upon request
by any shareholder of the Company interested in obtaining the same.
The Annual Accounts of the Company and its subsidiary companies are
also available for inspection by the shareholders during business hours
at the registered office of the Company.
CONSOLIDATED FINANCIAL STATEMENTS
Consolidated Financial Statements have been prepared in accordance with
the Accounting Standard 21 ''Consolidated Financial Statements'',
Accounting Standard 23 Accounting for Investments in Associates in
Consolidated Financial Statements'' and Accounting Standard 27
''Financial Reporting of Interest in Joint Ventures'', your Directors
have pleasure in attaching the Consolidated Financial Statements which
form part of the Annual Report.
FIXED DEPOSITS
The Company has not invited/accepted any public deposits and as such,
no amount on account of principal or interest on public deposits was
outstanding on the date ofthe Balance Sheet.
DIRECTORS
The Board of Directors at its meeting held on May 23, 2013 has subject
to the approval ofthe members at the ensuing Annual General Meeting;
the Board of Directors ofthe Company has proposed to revise
remuneration of Mr. Nitin M. Shah, Chairman and Managing Director and
Mr. Rahul N. Shah, Executive Director ofthe Company w.e.f. April 1,
2013 for a balance period of 2 years.
Mr. K. H. Vaidyanathan, shall retire by rotation at the forthcoming
Annual General Meeting of the Company and being eligible, offers
himself for reappointment.
Mr. Ramakant M. Nayak, shall retire by rotation at the forthcoming
Annual General Meeting ofthe Company and being eligible, offers himself
for reappointment.
Brief particulars and expertise of these Directors have been given in
the Report on the Corporate Governance and in the Notice of the ensuing
Annual General Meeting.
INSURANCE
The properties ofthe Company viz. building, plant and machinery and
stocks have been adequately insured.
EMPLOYEES
Employee''s relations remained cordial during the year under review.
INTERNAL CONTROL SYSTEMS AND ITS ADEQUACY
The Company has adequate internal control systems and procedures in
place for effective and smooth conduct of business and to meet
exigencies of operation and growth. The key business processes have
been documented. The transactions are recorded and reported in
conformity with generally accepted accounting practices. The Company
has an in house internal audit system and procedures to ensure
reliability of financial reporting, compliance with the Company''s
policies and practices, governmental regulations and statutes. The
Company has appointed M/s Tolia and Associates, Chartered Accountants
as Internal Auditor of the company from financial year 2012-13 and also
appointed for the financial year 2013-14.
RISK AND CONCERNS
Indian Economy has been on a growth track again. The growth is expected
to accelerate during the current year. However, excess liquidity and
inflation induced by supply constraints and anxiety about the eventual
withdrawal of stimulus continue to cause concern. The Company had
reported good growth in the Financial Year''s 2011-12 and 2012-13.
The Management continues to monitor the risks concerning the Company
and take actions as appropriate to the situation.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars relating to energy conservation, technology absorption,
foreign exchange earnings and outgo as required to be disclosed under
Section 217(1)(e) ofthe Companies Act, 1956 read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules,
1988 are provided in annexure to this Report.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to the Directors'' Responsibility Statement, the
Directors confirm that:
i. In the preparation of the annual accounts for the Financial Year
ended March 31, 2013, the applicable accounting standards have been
followed and no material departures have been made from the same;
ii. Appropriate accounting policies have been selected and applied
consistently and have made judgments and estimates that are reasonable
and prudent so as to give a true and fair view ofthe state of affairs
ofthe Company as at March 31, 2013 and ofthe Profit for that period;
iii. Proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets ofthe Company and for
preventing and detecting fraud and other irregularities, and
iv. The annual accounts have been prepared on a going concern basis.
AUDITOR''S REPORT
The Board has duly examined the statutory Auditor''s Report to the
financial statements and clarifications, wherever necessary, have been
included in the Notes to the Financial Statements section ofthe Annual
Report.
EXPLANATION TO AUDITORS OBSERVATION:
Reply to qualification given by the auditors in the Auditors Report:
Auditors Qualification: Para (a) ofthe Auditors Report: As more fully
explained in note No 34 to the notes to the financial statements, no
provision has been made by the Company in respect of its dispute with a
bank for claim made by the bank for Rs. 50,133,481/- on a derivative
contract entered into by its erstwhile subsidiary(now an associate),
the liability for which has been takenover by the Company. The Company
has not determined the quantum of mark to market losses as of the
balance sheet date on the above contract and have relied on a legal
opinion in the matter wherein no liability is expected. Pending to
final settlement ofthe matter, we are unable to quantify the extent of
provision required, if any, in this regard.
Managements Reply: Consequent to part sale of equity stake in an
erstwhile subsidiary in December 2010, the Company has taken over an
outstanding claim of a derivative contract amounting to Rs. 501.33 Lacs
(excluding interest). Based on a legal opinion, the Company has filed a
petition in the Hon''ble High Court of Bombay challenging the legality
of the contract. Pending decision, no provision is made in the books of
account for this claim.
Auditors Qualification: Para (b) of the Auditors Report: As more fully
explained in Note No. 42 to the Notes to the Financial Statements,
provisions of Rs. 4,50,000/- has been made for penalty towards
compounding of offences. Petition filed for alleged non-compliance of
several provisions of the Act before Ministry of Corporate Affairs.
Based on opinion obtained, the Company expects maximum penalty
Rs.4,50,000/- on disposal of its petitions. Pending disposal of
petition, we are unable to quantify the extent of additional provision
required, if any, in this regard.
MANAGEMENT REPLY:
The Company has filed the requisite applications with the Ministry of
Corporate Affairs (the MCA) for compounding for non-compliance of few
sections of the Companies Act, 1956 on January 28, 2013, January 30,
2013, February 2, 2013, February 11, 2013 & April 11, 2013. The Company
is awaiting for hearing from the MCA.
AUDITORS
The Auditors of the Company, M/s. Haribhakti & Co., Chartered
Accountants (FRN - 103523W) retire at the conclusion of ensuing Annual
General Meeting ofthe Company and being eligible offer themselves for
re-appointment as a statutory auditors for the Financial Year
2013-2014.
The Company has received a letter from M/s. Haribhakti & Co., Chartered
Accountants to the effect that their appointment, if made, would be
within the prescribed limits under Section 224 (1B) of the Companies
Act, 1956 and that they are not disqualified within the meaning of
Section 226 ofthe said Act.
Members are requested to consider their appointment, on a remuneration
to be decided by the Board of Directors thereof for the ensuing
Financial Year i.e. 2013-2014.
The Notes to the Financial Statements referred to in the Auditor''s
Report are self-explanatory and therefore do not call for any further
comments.
MANAGEMENT DISCUSSION AND ANALYSIS
A Report on Management Discussion and Analysis is annexed and same
forms part of this Report.
CORPORATE GOVERNANCE REPORT
The Company has adopted the best possible Corporate Governance norms
and it has been our endeavor to comply and upgrade to the changing
norms.
A separate section on corporate governance and a certificate from a
Practicing Company Secretary regarding compliance of conditions of
Corporate Governance as stipulated under the Clause 49 ofthe Listing
Agreement with the stock exchanges form part of this Report.
In terms of sub-clause (v) of the Clause 49 of the Listing Agreement, a
certificate of the Managing Director and Vice President Finance, inter
alia, confirming the correctness of the financial statements, adequacy
of the internal control measures and reporting to matters to the Audit
Committee in terms ofthe said Clause, is also enclosed as a part of
this Report.
ACKNOWLEDGEMENTS
The Board acknowledges with appreciation the efforts put in by its
employees during the year under review. The Company is grateful to its
customers, shareholders, suppliers, financial institutions, bankers
Central and State Governments for their constant support to the
Company. The Directors also place on record their deep appreciation of
the contribution made by employees at all levels, the consistent growth
of the Company was made possible by their hard work loyalty,
dedication, co-ordination and support.
For and on behalf of the Board
Mumbai Sd/-
May 23, 2013 Nitin M. Shah
Chairman and Managing Director
Mar 31, 2012
To the Members of Nitin Fire Protection Industries Limited
The Directors have pleasure in presenting the Seventeenth Annual
Report together with the Audited Statement of Accounts for the year
ended March 31, 2012.
FINANCIAL RESULTS
Accounting Policy
The Company follows the Generally Accepted Accounting Principles (GAAP)
in India, applicable accounting standards/provisions of the Companies
Act, 1956 for the preparation of its financial statements. The Company
also follows accrual basis of accounting except in cases of revaluation
of assets and impairment, if any.
Summarised Statement of Profit and Loss
(Rs. in lacs)
Particulars Standalone Consolidated
For the year For the year For the year For the year
2011-12 2010-11 2011-12 2010-11
Sales & other
income 16,535.44 16,225.28 53,906.88 45,226.08
Profit before
depreciation,
amortisation & tax 1,358.34 2,855.33 5,378.52 6,822.37
Depreciation/
amortisation 99.75 28.33 296.88 534.30
Profit before tax 1,258.58 2,827.00 5,081.64 6,288.07
Provision for
income tax
including
deferred tax 253.51 349.20 373.21 375.09
Provision for
wealth tax 0.37 0.07 0.76 1.35
Tax adjustments
of earlier years
(net) (0.83) 105.91 3.20 110.39
Profit after tax 1,005.53 2,371.82 4,704.47 5,801.24
Less: Share of
Minority Interest
in income - - - 122.85
Add: Share of
(loss)/profit in
an associate - - (302.75) (342.37)
Profit brought
forward from
previous year 3,822.35 2,362.28 13,862.12 9,538.48
Surplus on
Amalgamation (66.41) - (1323.09) -
Profit available
for appropriation 4,827.89 4,734.10 18,263.83 14,874.50
APPROPRIATIONS
Transferred to
General Reserve 80.00 237.50 80.00 280.00
Proposed dividend 882.21 630.15 882.21 630.15
Corporate dividend
tax on proposed
dividend 143.12 44.10 143.12 102.23
Surplus carried
forward to Balance
Sheet 3,656.15 3,822.35 15,835.41 13,862.12
DIVIDEND
The Board of Directors encouraged with the above financial performance
of the Company, recommends dividend of Rs. 0.40/- per share on
22,05,52,694 Equity Shares of Rs. 2/- each (Previous year Rs. 1/- per share
on 63,015,705 Equity Shares of Rs. 2/- each)
SHARE CAPITAL
During the year, the Company has allotted 15,75,36,989 Bonus Shares .
The paid up share capital of the Company has been increased from
63,015,705 Equity Shares of Rs. 2/- each to 22,05,52,694 Equity Shares of
Rs. 2/- each.
TRANSFER TO RESERVES
The Company proposes to transfer Rs. 80.00 lacs to the General Reserve
out of the amount available for appropriations and an amount of Rs.
3,656.15 lacs is proposed to be retained in the Profit and Loss Account
RESERVE AND SURPLUS
Reserves and Surplus stood at to Rs. 9,401.46 lacs as at March 31, 2012
compared to Rs. 11,380.32 lacs as at March 31, 2011. The decreases is due
to issue of bonus shares.
OPERATION RESULTS AND BUSINESS
The Company continued to see strong and profitable growth in the
Financial Year 2011-12 across all markets driven by good performance
across all business segments.
The performance of your Company during the year under report has
registered an improvement over the previous year. Total income during
the year ended March 31, 2012 stood at Rs. 16,535.44 lacs registering an
increase of 1.91% as compared to the previous year. As per the
Consolidated Financial Statements, total income was Rs. 53,906.88 lacs
registering an increase of 19.19% as compared to the previous year. The
working of the Company is considered satisfactory. Barring unforeseen
circumstances, the Board of Directors are hopeful of better performance
of the Company during the current year.
The Company is among the leading fire fighting equipment manufacturing
companies in India, and continues to retain its leadership position
among the Indian companies. It has continued to win new engagements and
grow existing relationships in the traditional area of development,
manufacturing and distribution of fire protection and electronic
security systems, CNG cascades, commissioning and installation of
safety and security solutions and execution of annual maintenance
contracts for fire protection systems. It provides automated water and
gas based fire suppression systems along with fire detection and
security systems on turnkey basis. The broad range of products and
services enables the Company to provide "end -to-end" services to
its customers, combined with its industry focus and its geographical
spread, the Company is able to provide comprehensive and high value
added services to its customers. Considering the need to deepen
relationships with customers in the industry, to acquire new customers
in the markets where your Company is already a significant force and to
expand in emerging markets.
AMALGAMATION
Alert Fire Protection Systems Private Limited and Logicon Building
Systems Private Limited, wholly owned subsidiaries of the Company has
on May 16, 2011 filed a Scheme for amalgamation with the Company with
the Hon'ble High Court of Bombay. The Scheme shall be given effect to
in the Books with effect from the Appointed Date of April 1, 2010. The
Company has received approval from the Hon'ble High Court of Bombay on
January 13, 2012.
SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS
Your Company has four subsidiaries, namely, Eurotech Cylinders Private
Limited, India, Nitin Venture FZE, UAE, New Age LLC, UAE, and Nitin
Global Pte Limited, Singapore .
We believe that the presentation of the Consolidated Financial
Statements presents a more comprehensive picture rather than the
Standalone Financial Statements of the Company and each of its
subsidiaries.
However, a summary of financial information of each subsidiary
regarding Capital, Reserves, Total Assets, Total Liabilities, Details
of Investment, Turnover, Profit before Taxation, Provision for
Taxation, Profit after tax and Proposed Dividend have been separately
furnished forming part of this Annual Report.
Eurotech Cylinders Private Limited, India (ECPL)
ECPL is in the business of purchase and supply of high pressure
seamless/compressed natural gas cylinders (CNG) and valves. The
Company's products are sold under the brand name 'EURO' and basically
cater to domestic markets. ECPL supplies the above products to dealers
of industrial/medical gases, fire fighting equipments, CNG-NGV
vehicles, CNG Cascades etc.
Nitin Venture FZE, UAE (NV)
NV is set up in the free trade zone at Jebel Ali, Dubai to meet the
demands of international customers and providing simple, standalone
conventional to intelligent, integrated fire protection solutions
backed by a product portfolio consisting of complete spectrum of fire
and safety products with international approvals. NV is strategically
placed to be an international one stop source to discerning customers
for conventional to intelligent standalone/integrated fire detection
systems, water and gas based fire extinguishing systems, gas detection
systems, CCTV, access control & intrusion detection systems, high
pressure storage cylinders & accessories and integrated building
management systems.
New Age LLC, UAE (NA)
New Age LLC, UAE was established in 1976 at UAE. NA has got office and
representation in Abu Dhabi, Cubai, Sharjah, with experience in
installation in all seven Emirates.
NA is Professional Fire Protection Engineering Company providing
Equipments, Fire Protection System, Fire Detection System, Emergency
Lighting System and Water Mist Fire Protection Systems.
NA has taken several projects like Municipality, Airport Development
Board, Port Authority, Telecommunication Sites, Cement Plants, Ministry
of Education and Civil Defense. NA has also got Major Overseas License
along with Local License with staff over 140 personnel directly
employed by the Company.
Nitin Global Pte Limited, Singapore (NGPL)
NGPL was incorporated in July 2009 to meet the demands of South-East
Asian market and for providing simple, standalone conventional to
intelligent, integrated fire protection solutions backed by a product
portfolio consisting of complete spectrum of fire and safety products
with international approvals. NGPL is strategically placed to be an
international one stop source to discerning customers for conventional
to intelligent standalone / integrated fire detection systems, water
and gas based fire extinguishing systems, gas detection systems, CCTV,
access control & intrusion detection systems, high pressure storage
cylinders & accessories and integrated building management systems.
There has been no other material change in the nature of the business
of the subsidiaries. A statement containing brief financial details of
the subsidiaries is included in the Annual Report
ANNUAL REPORT OF SUBSIDIARY COMPANIES
In terms of general exemption given by the Ministry of Corporate
Affairs, Government of India, vide General Circular No. 2/2011 dated
February 8, 2011 under section 212(8) of the Companies Act, 1956, a copy
of Balance Sheet, Statements of Profit and Loss, Report of the Board of
Directors and the Auditors of the above mentioned four subsidiary
companies for the year ended March 31, 2012 have not been attached with
the Annual Report of the Company. We believe that the presentation of the
Audited Consolidated Financials present a true and fair picture of the
state of affairs and the financial conditions.
The Company has also annexed a statement at the end of this Annual
Report pursuant to general exemption granted given by the Ministry of
Corporate Affairs, Government of India under section 212(8) of the
Companies Act, 1956, related to its subsidiary companies for the year
ended March 31, 2012.
The Company shall make available these documents/details upon request
by any shareholder of the Company interested in obtaining the same.
The Annual Accounts of the Company and its subsidiary companies are
also available for inspection by the shareholders during business hours
at the registered office of the Company.
CONSOLIDATED FINANCIAL STATEMENTS
Consolidated Financial Statements have been prepared in accordance with
the Accounting Standard 21 'Consolidated Financial Statements',
Accounting Standard 23 Accounting for Investments in Associates in
Consolidated Financial Statements' and Accounting Standard 27
'Financial Reporting of Interest in Joint Ventures', your Directors
have pleasure in attaching the Consolidated Financial Statements which
form part of the Annual Report.
FIXED DEPOSITS
The Company has not invited/accepted any public deposits and, as such,
no amount on account of principal or interest on public deposits was
outstanding on the date of the Balance Sheet.
DIRECTORS
The Board of Directors at its meeting held on May 29, 2012 has subject
to the approval Central Government and members of the Company at the
ensuing Annual General Meeting, reappointed Mr. Nitin M. Shah as
Managing Director designated as Chairman & Managing Director of the
Company w.e.f. April 1, 2012 for a further period of 3 years.
The Board of Directors at its meeting held on May 29, 2012 has subject
to the approval of the members at the ensuing Annual General Meeting,
reappointed Mr. Rahul N. Shah as Executive Director of the Company
w.e.f. April 1, 2012 for a further period of 3 years.
Mr. Krishnakant Jha, shall retire by rotation at the forthcoming Annual
General Meeting of the Company and being eligible, offers himself for
reappointment.
Mr. Satish K. Dheri was appointed as an Additional Director of the
Company at meeting of the Board held on May 29, 2012. Mr. Satish K.
Dheri is holding office of Director until the date of the ensuing
Annual General Meeting. The Company had received Notice and requisite
fee from a shareholder for proposing appointment of Mr. Satish K. Dheri
in the Board.
Brief particulars and expertise of these Directors have been given in
the Report on the Corporate Governance and in the Notice of the ensuing
Annual General Meeting.
INSURANCE
The properties of the Company viz. building, plant and machinery and
stocks have been adequately insured.
EMPLOYEES
None of the employees of the Company has received remuneration
exceeding the limits prescribed under Section 217(2A) of the Companies
Act, 1956 read with the Companies (Particulars of Employees) Rules,
1975.
Employee's relations remained cordial during the year under review.
INTERNAL CONTROL SYSTEMS AND ITS ADEQUACY
The Company has adequate internal control systems and procedures in
place for effective and smooth conduct of business and to meet
exigencies of operation and growth. The key business processes have
been documented. The transactions are recorded and reported in
conformity with generally accepted accounting practices. The Company
has an in house internal audit system and procedures to ensure
reliability of financial reporting, compliance with the Company's
policies and practices, governmental regulations and statutes.
RISK AND CONCERNS
Indian Economy has been on a growth track again. The growth is expected
to accelerate during the current year. However, excess liquidity and
inflation induced by supply constraints and anxiety about the eventual
withdrawal of stimulus continue to cause concern. The Company had
reported good growth in the Financial Year 2011-12.
The Management continues to monitor the risks concerning the Company
and take actions as appropriate to the situation.
CONSERVATION OF ENERGY
The Company is not required to furnish the prescribed information under
Section 217(I) (e) of the Companies Act, 1956 relating to conservation
of energy, as the Company does not fall under the Industries included
in the Schedule to relevant rules. However, your Directors report that
operations of the Company do not involve much use of energy. The
Company makes every possible effort to conserve energy at all levels of
its operations. Statement of particulars of the conservation of energy
forms part of this Report
TECHNOLOGY ABSORPTION
The Company is presently carrying its business with in-house Indian
technology. Statement of particulars of the technology absorption forms
part of this Report
FOREIGN EXCHANGE EARNINGS AND OUTGO
Statement of particulars of the foreign exchange earnings and outgo
forms part of this Report
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to the Directors' Responsibility Statement, the
Directors confirm that:
i. In the preparation of the annual accounts for the Financial Year
ended March 31, 2011, the applicable accounting standards have been
followed and no material departures have been made from the same,
ii. Appropriate accounting policies have been selected and applied
consistently, and have 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 as at March 31, 2011 and of the Statements of Profit &
Loss for the year than ended.
iii. Proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities, and
iv. The annual accounts have been prepared on a going concern basis.
AUDITORS
The Auditors of the Company, Haribhakti & Co, Chartered Accountants
retire at the conclusion of ensuing Annual General meeting of the
Company and being eligible offer themselves for re-appointment as
statutory auditors for the Financial Year 2012-2013.
The Company has received a letter from Haribhakti & Co, Chartered
Accountants to the effect that their appointment if made, would be
within the prescribed limits under Section 224(1B) of the Companies
Act, 1956 and that they are not disqualified within the meaning of
Section 226 of the said Act.
Members are requested to consider their appointment, on a remuneration
to be decided by the Board of Directors thereof for the ensuing
Financial Year i.e. 2012-2013.
The Notes to the Financial Statements referred to in the Auditor's
Report are self-explanatory and therefore do not call for any further
comments. AUDITOR'S REPORT
The Board has duly examined the statutory Auditor's Report to the
financial statements and clarifications, wherever necessary, have been
included in the Notes to the Financial Statements section of the Annual
Report.
EXPLANATION TO AUDITORS OBSERVATION:
Reply to qualification given by the auditors in the Auditors Report:
Auditors Qualification: Para 5(a) of the Auditors Report: the Company
executes composite contracts with its customers for the supply and
installation of fire protection system. Based on the nature of the
activity, execution of work and the contracts entered into by the
company, the contract revenue and contract costs need to be accounted
by adopting the percentage of completion method as prescribed under AS
7 "Construction Contracts". However the Company has accounted the
revenue as per AS 9 "Revenue Recognition" based on the dispatch of
material and on completion of installation work. The impact due to
above is presently not ascertainable.
Managements Reply: The Company is under the process of implementing an
ERP system and accordingly will ensure compliance with Accounting
Standard-7.
Auditors Qualification: Para 5(b) of the Auditors Report: The Company
is in dispute with a bank for a claim made by the bank for Rs.
50,133,481/- on a derivative contract entered into by its erstwhile
subsidiary, the liability for which has been taken over by the Company.
The erstwhile subsidiary is now an associate based on a sale of its 40%
share and increase in paid up capital of the associate. The Company has
not determined the quantum of mark to market losses as of the balance
sheet date on the above contract and have relied on a legal opinion in
the matter wherein no liability is expected. Pending the final
settlement of the matter, we are unable to quantify the extent of
provision required, if any in this regard.
Managements Reply: Consequent to part sale of equity stake in an
erstwhile subsidiary in December 2010, the Company has taken over an
outstanding claim of a derivative contract amounting to Rs. 50,133,481/-
(excluding interest). Based on a legal opinion, the Company has filed a
petition in the Hon'ble High Court of Bombay challenging the legality
of the contract. Pending decision, no provision is made in the books of
account for this claim.
Auditors Qualification: Para 5(c) of the Auditors Report: The Company
is in the process of obtaining details regarding identification of
creditors registered under the Micro, Small and Medium Enterprise
Development Act, 2006.
Managements Reply: The Company is in the process of obtaining necessary
information relating to the registration status of suppliers under the
Micro, Small and Medium Enterprises Development Act, 2006. Hence, the
information required under the said Act, could not be compiled and
disclosed. However, the Company since obtained few confirmations to
this effect.
MANAGEMENT DISCUSSION AND ANALYSIS
A Report on Management Discussion and Analysis is annexed and same
forms part of this Report.
CORPORATE GOVERNANCE REPORT
The Company has adopted the best possible Corporate Governance norms
and it has been our endeavor to comply and upgrade to the changing
norms.
A separate section on corporate governance and a certificate from the
Practicing Company Secretary regarding compliance of conditions of
Corporate Governance as stipulated under the Clause 49 of the Listing
Agreement with the stock exchanges form part of this Report.
In terms of sub-clause (v) of the Clause 49 of the Listing Agreement, a
certificate of the Managing Director inter alia, confirming the
correctness of the financial statements, adequacy of the internal
control measures and reporting to matters to the Audit Committee in
terms of the said Clause, is also enclosed as a part of this Report.
ACKNOWLEDGEMENTS
The Board acknowledges with appreciation the efforts put in by its
employees during the year under review. The Company is grateful to its
customers, shareholders, suppliers, financial institutions, bankers
Central and State Governments for their constant support to the Company
The Directors also place on record their deep appreciation of the
contribution made by employees at all levels, the consistent growth of
the Company was made possible by their hard work loyalty, dedication,
co-ordination and support.
For and on behalf of the Board
Sd/-
Mumbai Nitin M Shah
May 29, 2012 Chairman & Managing Director
Mar 31, 2011
To the Members,
The Directors have pleasure in presenting the Sixteenth Annual Report
together with the Audited Statement of Accounts for the year ended
March31,2011.
FINANCIALRESULTS
Accounting Policy
The Company follows the Generally Accepted Accounting Principles (GAAP)
in India, applicable accounting standards/provisions of the Companies
Act, 1956 for the preparation of its financial statements The Company
also follows accrual basis of accounting except in cases of
revaluation of assets and impairment losses, if any.
Summarised Profit and Loss Statement
(Rs. in lacs)
Particulars Standalone Consolidated
For the
year For the
year For the
year For the
year
2010-11 2009-10 2010-11 2009-10
Sales & other income 16,226.99 9,425.05 45,330.91 31,625.94
Profit before depreciation
/ amortisation & tax 2,855.33 1,489.79 6,822.36 4,999.92
Depreciation/ amortisation 28.33 48.36 534.30 415.21
Profit before tax 2,827.00 1,441.43 6,288.06 4,584.71
Provision for income tax
including deferred tax 349.20 207.26 375.62 808.71
Provision for wealth tax 0.07 0.15 0.82 1.25
Tax adjustments of earlier
years (net) 105.91 58.92 110.39 75.73
Profit after tax 2,371.82 1,175.10 5,801.23 3,699.02
Less: Share of minority
interest in income - - 122.85 -
Add: Share of (loss)/
profit in an associate - - (342.36) 481.46
Add: Prior period adjustments - - - 12.80
Profit brought forward from
previous year 2,362.28 1,863.26 9,538.48 6,021.28
Profit available for
appropriation 4,734.10 3,038.36 14,874.50 10,214.56
APPROPRIATIONS
Transferred to General Reserve 237.50 160.00 280.00 160.00
Proposed dividend 630.15 441.11 630.15 441.11
Corporate dividend tax on
proposed dividend 44.10 74.97 102.23 74.97
Surplus carried forward to
Balance Sheet 3,822.35 2,362.28 13,862.12 9,538.48
DIVIDEND
The Board of Directors encouraged with the above financial performance
of the Company, recommends dividend of Rs.1/- per share on 6,30,15,705
Equity Shares of Rs. 21- each (Previous year Rs. 3.50 per share on
1,26,03,141Equity Shares of Rs.10/-each)
SHARE CAPITAL
During the year, the Company has sub-divided (split) its shares from
Rs. 10/- each to Rs. 21- each. There was no change in the paid up share
capital of the Company during the year
TRANSFERTO RESERVES
The Company proposes to transfer Rs. 237.5 lacs to the General Reserve
out of the amount available for appropriations and an amount ofRs.
3,822.35 lacs is proposed to be retained in the Profit and Loss Account
RESERVE AND SURPLUS
Reserves and Surplus stood at toRs. 11,380.32 lacs as at March31,2011
compared toRs.9,693.60 lacs as at March31,2010. The increase was due to
retainedearnings
OPERATION RESULTS AND BUSINESS
The Company continued to see strong and profitable growth during the
Financial Year 2010-11 across all markets driven by good performance
across allbusiness segments.
The performance of your Company during the year under report has
registered an improvement over the previous year. Total income during
the year ended March 31, 2011 stood at Rs. 16,226.99 lacs registering
an increase of 72% as compared to the previous year. As per the
Consolidated Financial Statements, total income was Rs. 45,330.91 lacs
registering an increase of 43.33% as compared to the previous year The
working of the Company is considered satisfactory. Barring unforeseen
circumstances, the Board of Directors are hopeful of better performance
of the Company duringthecurrentyear.
The Company is among the leading fire fighting equipment manufacturing
companies in India, and continues to retain its leadership position
among the Indian companies. It has continued to wm new engagements and
grow existing relationships in the traditional area of development,
manufacturing and distribution of fire protection and electronic
security systems, CNG cascades, commissioning and installation of
safety and security solutions and execution of annual maintenance
contracts for fire protection systems. It provides automated water and
gas based fire suppression systems along with fire detection and
security systems on turnkey basis The broad range of products and
services enables the Company to provide "end to-end" services to its
customers, combined with its industry focus and its geographical
spread, the Company is able to provide comprehensive and high value
added services to its customers. Considering the need to deepen
relationships with customers in the industry, to acquirenew customers
in the markets where your Company is already a significant force and to
expand in emerging markets.
SUBSIDIARY COMPANIES AND CONSOLROATED FINANCIAL STATEMENTS
Your Company has six subsidiaries, namely' Alert Fire Protection
Systems Private Limited, India Eurotech Cylinders Private Limited,
India, Logicon Building Systems Private Limited, India, Nitin Venture
FZE, UAE, New Age Company LLC, UAE and Nitin Global Pte Limited,
Singapore. One domestic subsidiary i.e. Nitin Cylinders Limited has
become associate of the Company which has changed its name to
Worthington Nitin Cylinders Limited. A Foreign associate Company i.e.
New Age LLC, UAE, has become a step down subsidiary with the holding
being throug haforeign subsidiary.
We believe that the presentation of the Consolidated Financial
Statements presents a more comprehensive picture rather than the
Standalone Financial Statements of the Company and each of its
subsidiaries. As per terms of general exemption, a summary of financial
information of each subsidiary regarding Capital, Reserves, Total
Assets, Total Liabilities, Details of Investment, Turnover, Profit
before Taxation, Provision for Taxation, Profit after Rs. Tax and
Proposed Dividend have been separately furnished forming part of this
Annual Report.
Alert Fire Protection Systems Private Limited, India (Alert)
Alert is in the business of purchase and supply of fire alarm and
detection equipments, control panels and related components/spare parts
which are mainly sourced from all.K. based Company viz. Apollo Fire
Detectors and Fire Fighting Enterprise.
Eurotech Cylinders Private Limited, India (ECPL)
ECPL is in the business of purchase and supply of high pressure
seamless and valves. The Company's products are sold under the brand
name 'EURO' and basically cater to domestic markets. ECPL supplies the
above products to dealers of industrial/medical gases, fire fighting
equipments.
Logicon Building Systems Private Limited, India (Logicon)
Logicon is in the business of setting up of turnkey contracts for
intelligent building management systems, clean agent and fire detection
alarm systems including water based hydrant systems, CCTV and security
systems including designing, integration, installation of such systems
and maintenance services. Such systems are used for security and
building automation of all kindsof buildings, be it I.T complexes,
shopping malls, industrial plant buildings, hospitals, hotels, banks,
datacenters etc.
Nitin VentureFZE, UAE (NV)
NV is set up in the free trade zone at Jebel Ali, Dubai to meet the
demands of international customers andprovides simple, standalone
conventional to intelligent, integrated fire protection solutions
backed by a product portfolio consisting of complete spectrum of fire
and safety products with international approvals. NV is strategically
placed to be an international one stop source to discerning customers
for conventional to intelligent standalone/integrated fire detection
Systems, water and gas based fire extinguishing systems, gas detection
systems, CCTV, access control & intrusion detection systems,
highpressure storage cylinders & accessories and integrated building
management systems.
New Age Company LLC, UAE (NA)
NA was established in 1976 at UAE. NAhas got offices and
representations in Abu Dhabi, Dubai, and Sharjah with experience in
installation in all the seven emirates.
NA is professional fire protection engineering company providing
equipments, fire protection system, fire detection system, emergency
lighting systeirland water mist fire protectionsystems
NA has taken several projects for Municipality, Airport Development
Board, Port Authority, Industrial Warehouses, Commercial Warehouses,
Electricity Board etc and also other government bodies.
Nitin GlobalPteLimited,Singapore(NGPL)
NGPL was incorporated in July 2009 to meet the demands of South-East
Asian markets and for providing simple, standalone conventional to
intelligent, integrated fire protection solutions backed by a product
portfolio consisting of complete spectrum of fire and safety products
with international approvals. NGPL is strategically placed to be an
international one stop source to discerning customers for conventional
to intelligent
standalone / integrated fire detection systems, water and gas based
fire extinguishing systems, gas detection systems, CCTV, access control
& intrusion detection systems, highpressure storage cylinders &
accessories and toegratedbuilding management systems.
There has been no other material change in the nature of the business
of the subsidiaries. A statement containing brief financial details of
the subsidiariesisincludedintheAnnualReport
PROPOSED AMALGAMATION OF SUBSIDIARY COMPANIES WITH THECOMPANY
The Board of Directors of the Company in its board meeting held on
February 11, 2011 has approved the amalgamation with itself of Alert
Fire Protection Systems Private Limited and Logicon Building Systems
Private Limited with April 1, 2010 being the appointed date. In this
regard, your Company has received an in principle approval from both
the stock exchanges. Your Company has since filed a joint petition
before the Hon'ble High Court of Bombay for the sanction of the scheme
and approval is awaited.
ANNUALREPORT OF SUBSIDIARY COMPANIES
In terms of general exemption givenbythe Ministry ofCorporateAffairs,
Government of lndia, vide General Circular No.2/2011 dated February
8,2011 under section 212(8) ofthe Companies Act,l 956, acopy of Balance
Sheet, Profit and Loss Account, Report of the Board of Directors and
the Auditors of the abovementioned six subsidiary companies for the
year ended March 31,2011 have not been attached with the Annual Report
of the Company. We believe that the presentation of the Audited
Consolidated Financials present a true and fair picture of the state of
affairs and the financial conditions.
The Company has also annexed a statement at the end of this Annual
Report pursuant to general exemption granted given by the Ministry of
Corporate Affairs, Government of rndia under section 212(8) of the
Companies Act, 1956, related to its subsidiary companies for the year
ended March31,2011.
The Company shall make available these documents/details upon request
by any shareholder of the Company interested in obtaining the same.
The annual accounts of the Company and its subsidiary companies are
also available for inspection by the shareholders during business hours
at theregisteredofficeoftheCompany
CONSOLIDATED FINANCIAL STATEMENTS
Consolidated Financial Statements have been prepared in accordance with
the Accounting Standard 21 'Consolidated Financial Statements',
Accounting Standard 23 'Accounting for Investments in Associates in
Consolidated Financial Statements' and Accounting Standard 27
'Financial Reporting of Interest in Joint Ventures'. Your Directors
have pleasure in attaching the Consolidated Financial Statements which
form part of the Annual Report.
FIXEDDEPOSITS
The Company has not invited/accepted any public deposits and, as such,
no amount on account of principal or interest on public deposits was
outstanding on the date of the Balance Sheet
DIRECTORS
Dr. Surendra A. Dave, shall retire by rotation at the forthcoming
Annual General Meeting of the Company and being eligible, offers
himself for reappointment.
Mr. Kunal N. Shah was appointed as an Additional Director of the
Company at meeting of the Board held on May 29,2011. Mr. Kunal N. Shah
is holding office of Director until the date of the ensuing Annual
General Meeting. The Company had received Notice and requisite fee from
a shareholder forproposing appointment of Mr. Kunal N Shah in the
Board.
Brief particulars and expertise of these Directors have been given in
the Report on the Corporate Governance and in the Notice of the ensuing
Annual General Meeting
Insurance
The properties of the Company viz. building, plant and machinery and
stocks have been adequately insured.
EMPLOYEES
None of the employees of the Company has received remuneration
exceeding the limits prescribed under Section 217(2A) of the Companies
Act, 1956 read withthe Companies (Particulars of Employees) Rules,
1975.
Employee's relations remained cordial during the year under review.
INTERNAL CONTROL SYSTEMS AND ITS ADEQUACY
The Company has adequate internal control systems and procedures in
place for effective and smooth conduct of business and to meet
exigencies of operation and growth. The key business processes have
been documented. The transactions are recorded and reported in
conformity with generally accepted accounting practices. The Company
has an in house internal audit system and procedures to ensure
reliability of financial reporting, compliancewiththeCompany'spolicies
andpractices, governmental regulations and statutes.
RISK AND CONCERNS
Indian Economy has been on a growth track again. The growth is expected
to accelerate during the current year. However, excess liquidity and
inflation induced by supply constraints and anxiety about the eventual
withdrawal of stimulus continue to cause concern. The Company had
reported good growth in the Financial Year's 2009-10 and 2010-ll.
The Management continues to monitor the risks concerning the Company
and take actions as appropriate to the situation.
CONSERVATION OF ENERGY
The Company is not required to furnish the prescribed information under
Section 217 (I)(e) of the Companies Act, 1956 relating to conservation
of energy, as the Company does not fall under the industries included
in the Schedule to relevant rules. However, your Directors report that
operations of the Company do not involve much use of energy. The
Company makes every possible effort to conserve energy at all levels of
its operations. Statement of particulars of the conservation of energy
forms part of this Report
TECHNOLOGYABSORPTION
The Company is presently carrying its business with in-house Indian
technology. Statement of particulars of the technology absorption forms
part of this Report
FOREIGN EXCHANGE EARNINGS AND OUTGO
Statement of particulars of the foreign exchange earnings and outgo
forms part of this Report
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to the Directors' Responsibility Statement, the
Directors confirm that:
i. In the preparation of the annual accounts for the Financial Year
ended March 31, 2011, the applicable accounting standards have been
followed and nomaterial departure shave been made from the same,
ii. Appropriate accounting policies have been selected and applied
consistently, and have 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 as at March 31,2011 and of the Profit & Loss Account for
theyearthanended.
iii. Proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities, and
iv. The annual accounts have been prepared on a going concern basis.
AUDITORS
The Auditors of the Company, Haribhakti & Co, Chartered Accountants
retire at the conclusion of ensuing Annual General meeting of the
Company and bemg eligible offer themselves forre - appointment as
statutory auditors for the Financial Year 2011-2012.
The Company has received a letter from Haribhakti & Co, Chartered
Accountants to the effect that their appointment if made, would be
within the prescribed limits under Section 224(1B) of the Companies
Act, 1956 and that they are not disqualified within the meaning of
Section 226 of the saidAct.
Members arerequested to consider their appointment, on a remuneration
to be decided by the Board of Directors thereof for the ensuing
Financial Yearie. 2011-2012.
The Notes to the Financial Statements referred to in the Auditor's
Report are self-explanatory and therefore do not call for any further
comments.
AUDITOR'S REPORT
TheBoardhasduly examined the statutoryAuditor's Report to the financial
statements andclarifications, wherever necessary, have been included in
the Notes to the Financial Statements section of the Annual Report.
EXPLANATIONTOAUDITORSOBSERVATIONS:
Reply to qualifications given by the auditors intheAuditors Report:
Auditors Qualification: Para 5(a) of the Auditors Report: The Company
executes composite contracts with its customers for the supply and
installation of fire protection system. Based on the nature of the
activity, execution of work and the contracts entered into by the
company, the contract revenue and contract costs need to be accounted
by adopting the percentage of completion method as prescribed under AS
- 7 "Construction Contracts". However, the Company has accounted
revenue as per AS - 9 "Revenue Recognition" based on dispatch of
material and on completion of installation work. The impact due to
above is presently not as certainable.
Managements Reply: The Company is under the process of implementing an
ERP system and accordingly will ensure compliance with Accounting
Standard-7 "ConstructionContracts" in the subsequent fcancial years.
Auditors Qualification: Para 5(b) of the Auditors Report: As stated in
note 21 of the Schedule O, the Company is in dispute with a bank for a
claim made by the bank for Rs. 50,133,481 excluding interest on a
derivative contract entered into by its erstwhile subsidiary, the
liability for which has been takenover by the Company. The erstwhile
subsidiary is now an associate based on a sale of its 40% share and
increase in paid up capital of the associate. The Company has not
determined the quantum of mark to market losses as of the balance sheet
date on the above contract and have relied on a legal opinion in the
matter mentioning that no liability is expected. Pending final
settlement of the matter, we are unable to quantify the
extent of provision required, if any in this regard
Managements Reply: Consequentto part sale of equity stake in
Worthington Nitin Cylinders Limited inDecember 2010, the Company has
taken over the outstanding claim of a derivative contract amounting to
Rs. 50,133,481 (excluding interest). The Company has obtained a legal
opinion mentioning that the said contract is in violation of the RBI
regulations andhence, no liability is expected. Further, the Company
has filed a petition in the HonWe High Court of Bombay challen^^^
Auditors Qualification: Para 5(c) of the Auditors Report: As stated
innote 6 of the Schedule O, the Company is in process of obtaining
details regarding identification of creditors register edunder the
Micro, Small and Medium Enterprise Development Act; 2006
Managements Reply: The Company is intheprocess of obtaining necessary
information relating to the registration status of suppliers under the
Micro Small and Medium Enterprises Development Act, 2006. Hence, the
information required under the said Act, could not be compiled and
disclosed. However, the Company since obtained few confirmations to
this effect.
MANAGEMENTDISCUSSIONAND ANALYSIS
AReport on Management Discussion and Analysis is annexed and same forms
part of this Report.
CORPORATE GOVERNANCE REPORT
The Company has adopted the best possible Corporate Governance norms
and it has been our endeavor to comply and upgrade to the changing
norms.
A separate section on corporate governance and a certificate from the
Practicing Company Secretary regarding compliance of conditions of
Corporate Governance as stipulated
underClause49oftheListingAgreementwiththe stock exchanges form part of
this Report.
In terms of sub-clause (v) of the Clause 49 of the Listing Agreement, a
certificate of the Managing Director inter alia, confirming the
correctness of the financial statements, adequacy of the internal
control measures and reporting to matters to the Audit Committee in
terms of the said Clause, is also enclosedas apart ofthis Report.
ACKNOWLEDGEMENTS
The Board acknowledges with appreciation the efforts put in by its
employees during the year under review. The Company is grateful to its
customers, shareholders, suppliers, financial institutions, bankers.
Central and State Governments fortheir constant support to the Company
The Directors also place on record their deep appreciation of the
contribution made by employees at all levels. The consistent growth of
the Company wasmadepossMebytheirhardworkloyalty dedication,
co-ordination and support.
For and on behalf of the Board
Mumbai Sd/-
July8,2011 Nitin M Shah
Chairman & Managing Director
Mar 31, 2010
The Directors have pleasure in presenting the Fifteenth Annual Report
together with the Audited Statement of Accounts for the year ended
March 31,2010.
FINANCIAL RESULTS
Accounting Policy
The Company follows the Generally Accepted Accounting Principles (GAAP)
in India, applicable accounting standards/provisions of the Companies
Act, 1956 for the preparation of its financial statements The Company
also follows accrual basis of accounting except in cases of
revaluationofassetsandimpakment,ifany.
Summarised Profit and Loss Statemen (in lacs)
Particulars Standalone Consolidated
For the For the For the For the
year year year year
2009-10 2009-09 2009-10 2008-09
Sales, operating income &
other income 9,425.05 6,648.39 32,107.40 25,149.13
Profit before depreciation
& tax 1,489.78 1,730.02 5,481.39 4,780.63
Depreciation/amortisation 48.35 46.92 415.21 335.31
Profit before tax 1,441.43 1,683.10 5,066.18 4,445.32
Provision for income tax
including deferred tax 207.26 275.57 808.71 956.27
Provision for fringe
benefit tax - 5.70 - 16.85
Provision for wealth tax 0.15 0.10 1.25 0.65
Tax adjustments of earlier
years (net) 58.92 - 75.73 -
Profit after tax 1,175.10 1,401.73 4,180.48 3,471.55
Add: Prior period adjustments - - 12.80 -
Profit brought forward from
previous year 1,863.26 1,006.39 6,021.28 3,236.08
Profit available for
appropriation 3,038.36 2,408.12 10,214.56 6,707.63
APPROPRIATIONS
Transferred to General
Reserve 160.00 145.00 160.00 244.00
Proposed dividend 441.11 378.09 441.11 378.09
Corporate dividend tax on
proposed dividend 74.97 21.77 74.97 64.26
Surplus carried forward to
Balance Sheet 2,362.28 1,863.26 9,538.48 6,021.28
DIVIDEND
The Board of Directors encouraged with the above financial performance
of the Company, recommends a dividend of ? 3.50 per share (Previous
year? 3.00 per share) on 12,603,141 Equity Shares of ? 10/- each
SHARE CAPITAL
During the year, authorized share capital of the Company was increased
from ? 1,500 lacs to ? 6,000 lacs. The issued and subscribed share
capital
of the Company consists of 12,603,141 equity shares of? 10/- each.
There was no change in the paid up share capital of the Company during
the year P
TRANSFER TO RESERVES
The Company proposes to transfer ? 160 lacs to the General Reserve out
of the amount available for appropriation and an amount of? 2,362.28
lacs is proposed to be retained in the Profit and Loss Account.
RESERVES AND SURPLUS
Reserves and Surplus stood at to ? 9,693.60 lacs as at March 31, 2010
compared to ? 9,047.14 lacs as at March 31, 2009. The increase was due
to retained earnings
OPERATION RESULTS AND BUSINESS
The Company continued to see strong and profitable growth in the
Financial Year 2009-10 across all markets driven by good performance
across all business segments.
The performance of your Company during the year under report has
registered an improvement over the previous year. Total income during
the year ended March 31, 2010 stood at ? 9,425.05 lacs registering an
increase of 41.76% as compared to the previous year. As per the
Consolidated Financial Statements, total income was ? 32,107.40 lacs
registering an increase of 27.67% as compared to the previous year The
working of the Company is considered satisfactory. Barring unforeseen
circumstances, the Board of Directors are hopeful of better performance
of the Company during the current year.
The Company is among the leading fire fighting equipment manufacturing
companies in India, and continues to retain its leadership position
among the Indian companies. It has continued to win new engagements and
grow existing relationships in the traditional area of development,
manufacturing and distribution of fire protection and electronic
security systems, CNG cascades, commissioning and installation of
safety and security solutions and execution of annual maintenance
contracts for fire protection systems. It provides automated water and
gas based fire suppression systems along with fire detection and
security systems on turnkey basis The broad range of products and
services enables the Company to provide "end to-end" services to its
customers, combined with its industry focus and its geographical
spread, the Company is able to provide comprehensive and high value
added services to its customers. Considering the need to deepen
relationships with customers in the
mdustry,toacqukenewcustomLinthemarketswhereyourCompanyisa
lreadyasigrdficantforceand
to expand in emerging markets.
SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS
Your Company has six subsidiaries, namely Alert Fire Protection
Systems Private Limited, India Eurotech Cylinders Private Limited,
india. Logicon Building Systems Private Limited, india, Nitin
Cylinders Limited, India, Nitin Venture FZE, UAE and Nitin Global Pte
Limited: Singapore
We believe that the presentation of the Consolidated Financial
Statement presents a more comprehensive picture rather than the
Standalone Financial Statements of the Company and each of its
subsidiaries. We, therefore, applied to the Ministry of Corporate
Affairs, Government of India and sough texemption from the requirement
to present detaile dfinancial statements of each subsidiary.
However, as per terms of exemption granted, a summary of financial
information of each subsidiary regarding Capital, Reserves, Total
Assets. Total Liabilities, Details of Investment, Turnover, Profit
before Taxation, Provision for Taxation, Profit after Tax and Proposed
Dividend have been separately furnished forming part of this Annual
Report.
Alert Fire Protection Systems Private Limited, India (Alert)
Alert is in the business of purchase and supply of fire alarm and
detection equipments, control panels and related components/spare parts
which are mainly sourced from UK. based companies viz. Apollo Fire
Detectors and Fixe Fighting Enterprise.
Eurotech Cylinders Private Limited, India (ECPL)
ECPL is in the business of purchase and supply of high pressure
seamless/compressed natural gas cylinders (CNG) and valves. The
Companys products are sold under the brand name EURO and basically
cater to domestic markets. ECPL supplies the above products to dealers
of industrial/medical gases, fire fighting equipments, CNG-NGV
vehicles, CNG Cascades etc.
Logicon Building Systems Private Limited, India (Logicon)
Logicon is in the business of setting up of turnkey contracts for
intelligent building management systems, clean agent and fire detection
alarm system including water based hydrant systems, CCTV and security
systems including designing, integration, installation of such systems
and maintenance services. Such systems are used for security and
building automation of all kinds of buildings, be it I.T complexes,
shopping malls, industrial plant buildings, hospitals, hotels, banks,
datacenters etc.
Nitin Cylinders Limited, India (NCL)
NCLs business activity is that of manufacture and sale of high
pressure seamless (CNG) cylinders with its manufacturing facilities
located at Vishakhapatnam Special Economic Zone (VSEZ), Andhra Pradesh
and sales being both within and outside India. The cylinders are
marketed under the brand name NITIE. For this said purpose, NCL has
entered into an agreement with your Company for use of the said brand
name. The
installed/licensedcapacitytomanufacturetneabovecylindersis
500,000cylindersperannum
NitinVentureFZE,UAE(NV)
NV is set up in the free trade zone at Jebel Ali, Dubai to meet the
demands of international customers and providing simple, standalone
conventional to intelligent, integrated fire protection solutions
backed by a product portfolio consisting of complete spectrin of fire
and safety products with international approvals. NV is strategically
placed to be an rntemationalone stop source to discerning customers for
conventional to intelligent standalone/integrated fire detection
systems, water and gas based fire extinguishing systems, gas detection
systems, CCTV, access control & intrusion detection systems,
highpressure storage cylinders & accessories and integrated building
management systems.
Nitin Global Pte Limited, Singapore (NGPL)
NGPL was incorporated in July 2009 to meet the demands of South-East
Asian market and for providing simple, standalone conventional to
intelligent, integrated fire protection solutions backed by a product
portfolio consisting of complete spectrum of fire and safety products
with international approvals. NGPL is strategically placed to be an
international one stop source to discerning Customers for conventional
to intelligent standalone / integrated fire detection systems, water
and gas based fire extinguishing systems, gas detection systems, CCTV,
access control & intrusion detection systems, high pressure storage
cylinders & accessories and integrated building"management systems.
There hasbeennomaterialchangeinthenatureofthebusinessofthesubsidiaries.
Astatementcontamingbrieffinancialdetailsofthesubsidiaries is included
in the Annual Report
ANNUAL REPORTOFSUBSIDIARYCOMPANIES
In terms of approval granted by the Ministry of Corporate Affairs,
Government ofmdia, vide letter datedApril5,2010undersection212(8)ofthe
CompaniesAct, 1956, a copy of Balance Sheet, Profit and Loss Account,
Report ofthe Board of Directors and the Auditors ofthe above mentioned
six subsidiary companies for the year ended March 31, 2010 have not
been attached with the Annual Report ofthe Company. We believe that the
presentationoftheLditedConsolidatedFinancialspresentatmeandf
airpictureofthestateofaffaksandthefmancialcL
The Company has also annexed a statement at the end of this Annual
Report pursuant to exemption received from the Ministry of Corporate
Affairs, Government of India under section 212(8) ofthe Companies Act,
1956, related to its subsidiary companies for the year ended March 31,
2010.
The Company shall make available these documents/details upon request
by any shareholder ofthe Company interested in obtaining the same. The
Annual Accounts ofthe Company and its subsidiary companies are also
available for inspection by the shareholders during business hours at
theregisteredofficeoftheCompany
CONSOLIDATED FINANCIALSTATEMENTS
hi accordance with the Accounting Standard 21 Consolidated Financial
Statements, Accounting Standard 23 Accounting for Investments in
Associates in Consolidated Financial Statements and Accounting
Standard 27 Financial Reporting of Interest in Joint Ventures, your
Directors havepleasureinattachmgtheConsolidatedFinancialStatements
whichformpartoftheAnnualReport.
FIXEDDEPOSITS
The Company has not invited/accepted any public deposits and, as such,
no amount on account of principal or interest on public deposits was
outstanding on the date of the Balance Sheet
DIRECTORS
Mr. Kailat H. Vaidhyanathan shall retire by rotation at the forthcoming
Annual General Meeting ofthe Company and being eligible, offers himself
Reappointment.
Mr.RamakantM.Nayakwas appointed as anIndependentDirectorofthe
CompanyatmeetingoftheBoardheldonAprill2,2010.Mr.Ramakant M. Nayak is
holding office of Director until the date of the ensuing Annual General
Meeting. The Company had received Notice and requisite fee from a
shareholder for proposing appointment of Mr.Ramakant MN ayakintheBoard.
Brief particulars and expertise of these Directors have been given in
the Report on the Corporate Governance and in the Notice of the ensuing
Annual General Meeting
INSURANCE
The properties of the Company viz. building, plant and machinery and
stocks have been adequately insured.
EMPLOYEES
Employees relations remained cordial during the year under review.
Particulars of employees as required under Section 217(2A) of the
Companies Act, 1956, read with the Companies (Particulars of Employees)
Rules, 1975, as amended and forming part ofthe Directors Report for
the year ended March 31, 2010 are not attached to this report as
permitted under theprovisionsofSection219(l)(b)(iv)oftheCompanie^
Company Secretary at the registered office of the Company.
INTERNAL CONTROL SYSTEMS AND ITS ADEQUACY
The Company has adequate internal control systems and procedures in
place for effective and smooth conduct of business and to meet
exigencies of operation and growth. The key business processes have
been documented. The transactions are recorded and reported in
conformity with generally accepted accounting practices. The Company
has an in house internal audit system and procedures to ensure
reliability of financial reporting, compliance with the Companys
policies and practices, governmental regulations and statutes.
RISKAND CONCERNS
Indian Economy has been on a growth track again. The growth is expected
to accelerate during the current year. However, excess liquidity and
inflation induced by supply constraints and anxiety about the eventual
withdrawal of stimulus continue to cause concern. The Company had
reported good growminFinancial Years 2008-09 and2009-10.
The Management continues to monitor the risks concerning the Company
and take actions as appropriate to the situation.
CONSERVATION OF ENERGY
TheCompanyisnotrequkedtofurmshtheprescribedinf"
energy, as the Company does not fall under the Industries included in
the Schedule to relevant rules. However, your Directors report that
operations of the Company do not involve much use of energy. The
Company makes every possible effort to conserve energy at all levels of
its operations. Statement of particulars of the conservation of energy
forms part of this Report
TECHNOLOGYABSORPTION
The Company is presently carrying its business with in-house Indian
technology Statement of particulars of the technology absorption forms
part of this Report
FOREIGN EXCHANGE EARNINGS AND OUTGO
Statement of particulars of the foreign exchange earnings and outgo
forms part of this Report
DIRECTORSRESPONSIBILITYSTATEMENT
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to the Directors Responsibility Statement, the
Directors confirm that:
i. In the preparation of the annual accounts for the Financial Year
ended March 31, 2010, the applicable accounting standards have been
followed and no material departures have been made from the same,
ii. Appropriate accounting policies have been selected and applied
consistently, and have made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state affairs of
the Company as at March 31,2010andoftheProfit&LossAccountforthe year
than ended.
iii. Proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
CompaniesAct,1956forsafeguardingtheassetsoftheCompanyandforpreven
tinganddetectingfraudandother irregularities, and
iv. The annual accounts have been prepared on a going concern basis.
AUDITORS
The Auditors of the Company, Tolia & Associates, Chartered Accountants
retire at the conclusion of ensuing Annual General meeting of the
Companyandbeingeligibteofferthemselvesforre-appomtmentasstatuto
ryauditorsfortheFmancialYear2010-2011^
The Company has received a letter from Tolia & Associates, Chartered
Accountants to the effect that their appointment if made, would be
within theprescribed limits under Section 224(1 B) ofthe Companies Act,
1956 and that they are not disqualified withm the meaning of Section226
ofthe saidAct.
Members are requested to consider their appointment, on a remuneration
to be decided by the Board of Directors thereof forthe ensuing
Financial Yeari.e.2010-2011.
TheNotestotheFmancialStatementsreferredtointheAuditors
Reportareself-explanatoryandthereforedonotcallforanyfurthercomments.
AUDITORS REPORT
TheBoardhasdulyexaminedthestatutoryAuditorsReporttothefinancial
statementsandclarifications,wherevernecessary,havebeen
included in the Notes to the Financial Statements section of the Annual
Report.
AUDITORS OBSERVATION:
The Audit Report and Notes to the Financial Statements referred to in
the Auditors Report are self-explanatory and therefore do not call for
any furthercomments.
MANAGEMENTDISCUSSIONAND ANALYSIS
A Report on Management Discussion and Analysis is annexed and same is
forms part of this Report.
CORPORATE GOVERNANCE REPORT
The Company has adopted the best possible corporate governance norms
and it has been our endeavor to comply and upgrade to the changing
norms.
A separate section on corporate governance and a certificate from a
Practicing Company Secretary regarding compliance of conditions of
Corporate Governance as stipulated under the Clause 49 ofthe Listing
Agreement with the stock exchanges form part of this Report.
In terms of sub-clause (v) of the Clause 49 of the Listing Agreement, a
certificate of the Managing Director inter alia, confirming the
correctness of the financial statements, adequacy of the internal
control measures and reporting to matters to the Audit Committee in
terms of the said Clause, is also enclosed as a part of this Report.
ACKNOWLEDGEMENTS
The Board acknowledges with appreciation the efforts put in by its
employees during the year under review. The Company is grateful to its
customers, shareholders, suppliers,fmancial institutions, bankers
Central and State Governments for their constant support to the Company
The Directors also place on record their deep appreciation of the
contribution made by employees at all levels, the consistent growth of
the Company was made possible by their hard work loyalty, dedication,
co-ordination and support.
For and on behalf of the Board of Directors
Sd/-
NitinMShah
Chairman & Managing Director
London August 17, 2010
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