Shree Ganesh Jewellery House I Ltd Directors Report

Dear Shareholders,

Your Directors have pleasure in presenting the Thirteenth Annual Report of the Company, together with the audited statement of accounts for the financial year ended 31st March, 2015.

1. FINANCIAL RESULTS

		(Rs in lacs)
For the year ended 31st March	Standalone
	Year ended 31st March, 2015	Year ended 31st March, 2014
Revenue from Operations	44,886.70	9,83,087.67
Other Income	10,241.36	174.60
Total Revenue/(Loss)	55,128.06	9,83,262.27
Profit/(Loss) Before Interest, Depreciation and Tax	7,629.61	(47,052.49)
Less: Depreciation/amortization	1,033.51	2,242.51
Less: Interest and finance charge (Net)	31,317.33	28,827.70
Profit/(Loss) Before Exceptional Items & Tax	(24,721.23)	(78,122.70)
Exceptional Item	-	39,059.14
Profit/(Loss) Before Tax	(24,721.23)	(1,17,181.84)
Provision for taxes	51,316.10	(39,994.82)
Profit/(Loss) After Tax	(76,037.33)	(77,187.02)
Surplus at the beginning of the year	25,396.23	1,00,333.74
Amount available for Appropriation	(50,641.10)	23,146.72

2. REVIEW OF OPERATIONS AND STATE OF COMPANYS AFFAIRS

The Companys total revenue was Rs 55,128.06 lacs for the year ended 31st March, 2015 as compared to Rs 9,83,262.27 lacs for the previous year. Your Company registered a loss after tax of Rs 76,037.33 lacs for the year ended 31st March, 2015 as compared to a loss of Rs 77,187.02 lacs incurred in the previous financial year.

3. material changes and commitments

No material changes and commitments have occurred from the close of the financial year till the date of this Report, which affects the financial position of the Company.

4. DIVIDEND

In view of the loss for the current financial year, your Directors do not recommend any dividend for the financial year ended 31st March, 2015.

5. TRANSFER TO RESERVES

The Company is not statutorily required to transfer any amount to the General Reserve, as no dividend has been recommended for the financial year 2014-15.

6. CONSOLIDATED FINANCIAL STATEMENT

In accordance with the Companies Act, 2013 ("the Act") and Accounting Standard (AS) - 21 on Consolidated Financial Statements read with AS - 23 on Accounting for Investments in Associates and AS - 27 on Financial Reporting of Interests in Joint Ventures, the audited consolidated financial statement is provided in the Annual Report.

7. SUBSIDIARY/ASSOCIATE/JOINT VENTURE COMPANIES

Easy Fit Jewellery Limited, Sumit Jewels Private Limited, Gaja Finance Private Limited, Gaja Fincorp Private Limited (formerly known as Veeyu India Private Limited), Alex Mercury Power Private Limited, Shree Ganesh Jewellery House FZE, Shree Ganesh Jewellery House (Singapore) Pte Ltd. and Shree Ganesh Jewellery House (Ghana) Limited continued to be wholly owned subsidiaries of the Company and Gaja Retail Private Limited (formerly known as Gokul Jewellery House Private Limited) continued to be a subsidiary of the Company.

Further, Shree Ganesh Jewellery House DMCC, Shirdi Commodities Private Limited, Shirdi Commosale Private Limited, Kamalraj Merchandise Private Limited and Chaturbhuj Vyapaar Private Limited continued to be step down subsidiaries of the Company. Further, Shree Ganesh Jewellery House (HK) Limited was incorporated as a wholly owned subsidiary of Shree Ganesh Jewellery House (DMCC) on 15th August, 2014.

Further, Oroitalia Chains Pvt. Ltd. also continued to be a Joint Venture of your Company whereas Alex Astral Power Pvt. Ltd., Alex Spectrum Radiation Pvt. Ltd. and Alex Green Energy Pvt. Ltd. continued to be Associate companies during the year under review.

In line with Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, the Listing Agreement with the Stock Exchanges and in accordance with the Accounting Standard 21 (AS-21), Consolidated Financial Statements prepared by your Company include financial information of its subsidiary Companies. Further, a report on the performance and financial position of each of the subsidiaries, associates and joint venture companies included in the Consolidated Financial Statements prepared by your Company as per Rule 8(1) of the Companies (Accounts) Rules, 2014, forms part of a separate statement in Form AOC-1.

The financial statements of the subsidiary companies and related information are available for inspection by the members at the Registered Office of your Company during business hours on all working days, except Saturdays, Sundays and public holidays, between 11.00 a.m. and 1.00 p.m. upto the date of the Annual General Meeting (AGM) as required under Section 136 of the Companies Act, 2013. Any member desirous of obtaining a copy of the said financial statements may write to the Company Secretary at the Registered Office of your Company.

8. PAID UP CAPiTAL

The paid up Equity Share capital as at 31st March, 2015 stood at Rs 7,190.65 lacs. During the year under review the Company has not altered its share capital.

9. LISTING OF EQUITY SHARES

Your Companys equity shares are listed on National Stock Exchange of India Limited (NSE) and BSE Limited (BSE). Further, the Non-Convertible Debentures of the Company are listed on the Debt segment of BSE Limited (BSE).

10. human resources

The Company has always given maximum importance for development of human resource, the vital asset responsible for continued success of the Company.

The Companys relentless effort to improve the performance of the employees by sharpening and honing their knowledge, skill and most importantly attitude continues to receive high priority.

As on 31st March, 2015, our Company had 108 employees on its rolls.

The Company wishes to put on record its deep appreciation for the co-operation and efforts of its employees for the betterment of the organisation.

11. CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Corporate Social Responsibility Committee (CSR Committee) of the Company has formulated the CSR Policy and the said Policy is available on your Companys website, the link to the Policy is provided elsewhere in the Annual Report.

The required details as specified in Companies (Corporate Social Responsibility Policy) Rules, 2014 is appended as Annexure I to the Directors Report.

12. code of conduct

The Directors and Senior Management have affirmed compliance with the Code of Conduct for Directors and Senior Management of the Company. A declaration to this effect has been signed by the Chairman and Whole-time Director and forms part of the Corporate Governance Report.

13. public deposits

The Company has not accepted any public deposits falling within the ambit of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014 and as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.

14. particulars of employees

Statement on the particulars of employees pursuant to Section 134(3)(q) and 197(12) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given in Annexure II to this Report and also forms part of the Annual Report.

15. PARTICULARS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars of conservation of energy, technology absorption and foreign exchange earnings and outgo in accordance with the provisions of Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is annexed as Annexure III and forms part of this Report.

16. RESPONSE TO QUALIFiED OPiNION iN THE AUDiTORS REPORT

A) The Statutory Auditors in their report to the Members, have given qualified opinion and the response of your Directors with respect to them are as follows:

Response to point no. (i) and (iii) - Fixed Deposit amounting to Rs 3,031.08 lacs was pledged with Axis Bank against various fund and non fund based limit sanctioned by the bank. On the maturity of the fixed deposit, it was adjusted with the cash credit balance in the Companys books as all the fund based and non fund based limits are debited to cash credit account. However, at the Banks end the matured amount was not adjusted in the cash credit account but was transferred to a separate account of the Bank and Bank is providing interest on the same. Your Company has taken up the matter with the bank and has requested for adjustment of the matured fixed deposit with respective sanctioned limit as per the sanction terms.

Response to point no. (ii) - Cash credit balance of Dhanalakshmi Bank as per Companys book was Rs 1,827.27 lacs and as per Bank confirmation was Rs 1,918.86 lacs as the Bank had charged an excess amount of Rs 91.59 lacs. Your Company had contested the excess amount claimed by the Bank in the Honble High Court at Calcutta and had received a stay order on the excess claim made by the Bank.

Response to point no. (iv) - Note. No. 7 includes Short term borrowings of Rs 44,655.46 lacs have not been confirmed as on 31st March, 2015. Your Company is in the process of obtaining confirmation as on 31st March, 2015. However, your Company has already obtained Bank Statement as on 31st March, 2015 to reconcile the same and the outstanding is since being reconciled.

B) The Statutory Auditors in their report to the Members, have stated "Emphasis of Matter" and the response of your Directors with respect to the same are as follows :

Response to point no. (a) - Various sales tax matters pertaining to assessment years 2006-07 to 2011-12 are pending at various stages with respective competent authorities. However, the Directors believe that these shall be in favour of the Company.

Response to point no. (b) - As explained in the "Emphasis of Matter" itself, although company has suffered significant operating losses during the year and is facing financial crunch with its inability to meet the financial obligations, your Company had applied for Composite Corporate Debt Restructuring with the banks to mitigate the above which was withdrawn by the banks in the consortium meeting held on 22nd January, 2015. The company had again requested for reconsideration of restructuring proposal by all the lenders. These facts have been disclosed in the notes by the management, in view of which, the accounts have been continued to be prepared under the going concern assumption. These facts have fully been disclosed in note No.51 and 54 of the Financial Statements.

C) The Statutory Auditors in their report to the Members on other legal and statutory reqiurements have provided their remarks as per Section 143(3) of the Companies Act, 2013 and the response of your Directors with respect to the same are as follows:

Response to point no. (2)(a) and (b) - The explanation on the same have been provided in Paragraph 1 and 3 of Point 16(A) of the Directors Report.

Response to point no. (2)(f) - The explanation of the same have been provided in Point 33(A) of the Directors Report.

17. AUDiTORS

The auditors, M/s Chaturvedi & Partners, Chartered Accountants, having Registration No. 307068E allotted by the Institute of Chartered Accountants of India hold office till the conclusion of the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

Your Company has received a confirmation from M/s Chaturvedi & Partners, Chartered Accountants to the effect that their re-appointment, if made, would be within the limits prescribed under Section 139 of the Companies Act, 2013 and the Rules framed thereunder. The Audit Committee and the Board of Directors of your Company recommend the re-appointment of M/s Chaturvedi & Partners, Chartered Accountants, as the Auditors of your Company. Members are requested to consider their reappointment as Auditors of your Company to hold office from conclusion of ensuing AGM until the conclusion of next AGM on remuneration to be decided by the Board of Directors based on recommendation of the Audit Committee of your Company.

18. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT-9, as required under Section 92(3) of the Companies Act, 2013, read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, is included as an Annexure iv to the Directors Report.

19. DiRECTORS

During the year under review, Mrs. Sukla Mitra and Mr. Rezaul Haque, on the recommendation of the Nomination and Remuneration Committee of the Company, were appointed as Additional Directors (Category - Independent) on the Board of the Company w.e.f. 6th November, 2014 and 12th February, 2015 respectively and also resigned from the Company as Directors w.e.f. 13th April, 2015 on medical grounds.

Mr. Raman Chopra was appointed as an Additional Director (Category - Independent) of the Company w.e.f. 11th May, 2015 and Mrs. Arvinder Kaur Sodhi and Mr. Pradeep Dhir were appointed as Additional Directors (Category - Independent) w.e.f. 30th May, 2015. Further, during the year under review, Mr. Ashok Prakash Sahni, Chief Financial Officer of the Company, was appointed as Additional Director w.e.f. 11th May, 2015 and as a Whole-time Director w.e.f. 1st June, 2015 for a term of 11 months, subject to the approval of the shareholders, liable to retire by rotation.

Further, during the year under review, Mr. Raj Mohan Choubey resigned as a Director of your Company w.e.f. 29th September, 2014 due to unavoidable personal reasons. Further, EXIM Bank also withdrew the nomination of Mr. Lokesh Kumar as Director from the Board of the Company which was accepted w.e.f. 1st December, 2014. Mr. D. P. Mathur also ceased to be a Director of your Company on account of sad demise on 7th December, 2014. Further, Mr. Paban Singh Ingty resigned as a Director of your Company w.e.f. 9th April, 2015 on medical ground.

Mr. Paban Singh Ingty and Mr. Umesh Parekh are deemed to have vacated their office w.e.f. 9th April, 2015 and close of business hours of 30th May, 2015 respectively under Section 167(1)(a) of the Companies Act, 2013. Further, Mr. Nillesh Parrekh is liable to vacate office under Section 167(1)(a) of the Act w.e.f. 30th June, 2015, on termination of his term of office as Wholetime Director (designated as Executive Chairman).

The Board wishes to place on record its sincere appreciation of the contribution, advice and guidance extended by Mr. Raj Mohan Choubey, Mr. Lokesh Kumar, Mr. D. P. Mathur, Mr. Paban Singh Ingty, Mrs. Sukla Mitra, Mr. Rezaul Haque and Mr. Umesh Parekh during their tenure as Directors of your Company. The Company has received requisite notice in writing from members proposing Mr. Raman Chopra, Mrs. Arvinder Kaur Sodhi, Mr. Pradeep Dhir for appointment as Independent Directors and Mr. Ashok Prakash Sahni as a Director (Category - Executive).

In view of the reconstituency of the Board comprising of Additional Directors and Mr. Nillesh Parrekh (Chairman and Wholetime Director), non-rotational Director, none of the Directors retire by rotation at the ensuing AGM.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed both under sub-section (6) of Section 149 of the Companies Act, 2013 and under Clause 49 of the Listing Agreement with the Stock Exchanges.

The brief resume / details relating to Directors who are to be appointed / re-appointed are furnished in the Notice of the ensuing AGM. The Board of Directors of your Company recommends the appointment of Mr. Ashok Prakash Sahni as Director and Wholetime Director, and Mr. Raman Chopra, Mrs. Arvinder Kaur Sodhi and Mr. Pradeep Dhir as Independent Directors.

20. KEY MANAGERiAL PERSONNEL

During the year under review, Mr. Ashok Prakash Sahni, being the Chief Financial Officer (CFO) of the Company was designated as Key Managerial Personnel u/s 203 of the Companies Act, 2013 w.e.f. 30th May, 2014.

Mr. Mukund Chandak resigned from the post of Company Secretary of the Company vide letter dated 1st October, 2014. Further, Mrs. Neha Jhunjhunwala, Associate Company Secretary bearing Membership No. A23732 and possessing requisite qualifications was appointed as the Company Secretary and Key Managerial Personnel of your Company w.e.f. 15th January, 2015.

Mr. Umesh Parekh, Managing Director of the Company, vacated his office u/s 167(1)(a) of the Companies Act, 2013 w.e.f. the close of business hours of 30th May, 2015 and is appointed as a Chief Executive Officer (CEO) and Key Managerial Personnel of the Company u/s 203 of the Companies Act, 2013 w.e.f. 1st June, 2015.

21. BoARD MEETiNGS

During the year under review, five Board Meetings were held on 30th May, 2014, 12th August, 2014, 21st October, 2014, 12th November, 2014 and 12th February, 2015 in accordance with Section 173 of the Companies Act, 2013. Further, due to urgency of matters, resolutions were passed by circulation on 6th November, 2014 and 18th December, 2014 and confirmed in the subsequent Board Meetings.

22. VIGIL MECHANISM/WHISTLE BLOWER POLICY

Pursuant to the Companies Act, 2013 and SEBIs Circular dated 17th April 2014, the Board of Directors of your Company has adopted the Vigil Mechanism/Whistle Blower Policy and the same is available on the website of the Company under the Investors Section, the link of which is provided elsewhere in the Annual Report.

23. AUDIT COMMITTEE

The Audit Committee has been reconstituted in accordance with the terms of reference of Section 177 of the Companies Act, 2013 and Clause 49 of the Listing Agreement. The details of the Audit Committee are given in the Corporate Governance Report.

24. POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION

The Company has a Nomination and Remuneration Committee (NRC) and the details of the Committee and terms of reference are set out in the Corporate Governance Report forming part of the Directors Report. The NRC has framed a Policy which lays down a framework in relation to appointment and remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. The weblink to the aforesaid Policy is provided elsewhere in the Annual Report.

25. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Particulars of loans given, investments made, guarantees given and securities provided, if any, is furnished in Notes 12, 14, 19, 32 and 33 to the financial statement.

26. particulars of contracts or arrangements with related parties

All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arms length basis. During the year, the Company had not entered into any contract/ arrangement / transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form AOC-2 is not required.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board is available on the website of the Company and the link to the same is provided elsewhere in this Annual Report.

27. Risk MANAGEMENT

The Company has in place a mechanism to identify, assess, monitor and mitigate various risks associated with the business. Major risks identified by the business and functions such as financial risks, regulatory risks are reviewed and discussed at the Audit Committee and Board Meetings. A Risk Management Policy has also been formulated and adopted by the Board.

28. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS/COURTS

During the year under review, the Banks withdrew their support for restructuring the credit facilities under Corporate Debt Restructuring mechanism. Your Company, thereafter, filed a Writ Petition before the Honble High Court challenging inter-alia the actions of the Corporate Debt Restructuring Empowered Group. An Interim Order was thereafter passed by the Honble High Court, Calcutta, directing continuation of the holding on operation of your Company.

29. PerfoRMANCE EVALUATION OF BOARD

Pursuant to the provisions of Section 134 of the Companies Act, 2013 and Clause 49 of the Listing Agreement, an annual performance evaluation of the Board as a whole, Board Committees and Directors was carried out during the relevant financial year.

The evaluation framework for assessing the performance of Directors comprises attendance of Board and Committee Meetings, quality of contribution to Board deliberations, and strategic perspectives or inputs in the growth of the Company. Further, a Member of the Board does not participate in the discussion of his/her evaluation.

30. familiarisation programme of independent directors

At the time of appointment of a Director, a formal letter of appointment is given to the Director which inter-alia explains the role, functions and responsibilities expected of him as a Director. The Directors are also familiarized with the business model, operations and functions of the Company, etc at the Board Meetings. The Directors are also updated on the changes in relevant corporate laws, rules, regulations and guidelines on a continuous basis.

The new Directors are provided with a copy of the Memorandum and Articles of Association, Annual Reports, various policies and documents of the Company to enable them to familiarize them with the Companys code, procedures and practices.

31. INTERNAL cONTROL systems AND THEIR ADEQuacY

Your companys internal control systems are adequate and commensurate with the nature and size of operations.

The Internal Auditors carried out audit in different areas of your Companys operations. The Audit Committee reviewed the audit programme and findings of the Internal Auditors.

32. DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has zero tolerance for sexual harassment at workplace and has put in place a policy on prevention, prohibition and redressal of sexual harassment at workplace as per the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules framed thereunder. As per the Policy, any employee may report his/her complaint to the Internal Complaints Committee constituted for this purpose. The said Policy can be viewed at the weblink provided elsewhere in the Report.

The following is the summary of sexual harassment complaints received and disposed off during the year:

i. No. of complaints received: Nil

ii. No. of complaints disposed off: Nil

33. SECRETARIAL AUDIT

M/s M R & Associates was appointed as the Secretarial Auditor of your Company pursuant to Section 204 of the Companies Act, 2013. The Secretarial Audit conducted by M/s M R & Associates for the financial year ended 31st March, 2015 is annexed as Annexure V to the Directors Report.

The explanation to the remarks in the Secretarial Audit Report are as follows:

A) The Directors are disqualified under Section 164(2) of the Companies Act, 2013 and are not eligible to be re-appointed as Directors since debentures have not been redeemed on the due date. Mr. Paban Singh Ingty has resigned w.e.f. 9th April, 2015 whereas Mr. Umesh Parekh has vacated office w.e.f. the close of business hours of 30th May, 2015. Further, Mr. Nillesh Parrekh, being non-rotational Director, shall continue his office till the expiry of his term i.e. upto 30th June, 2015 and shall not be re-appointed. Requisite e-form has been filed with the competent authority for disqualification of Directors.

B) The Company has a pending case under Section 217(1)(e) and Section 217(2A) of the Companies Act, 1956 and the matter is subjudice with the competent authority.

34. DIRECTORS RESPONSIBILITY STATEMENT:

In terms of provisions of Section 134 of the Companies Act, 2013, your Directors confirm that:

a. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

b. the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the Companys state of affairs at the end of the financial year and of the loss of the Company for the period under review;

c. the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. the Directors have prepared the annual accounts for the period ended 31st March, 2015 on a going concern basis;

e. the Directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and operating effectively; and

f. the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

35. ACKNOWLEDGEMENT

Your Directors take this opportunity to offer their thanks and deep sense of gratitude for the co-operation and support received from the government authorities, financial institution/banks, customers, vendors, shareholders and the society at large. We would also like to place on record, our sincere appreciation for the total commitment, dedication, contribution and hard work of employees across all levels. The credit for the Companys achievement goes to them. We are deeply grateful to our shareholders for the confidence and faith reposed on us. Your Company looks forward to their continued co-operation in realisation of the corporate goals in the years ahead.

	For and on behalf of the Board of Directors
	Sd/-
	Nillesh Parrekh
Place : Kolkata	Chairman
Date : 30th May, 2015	DIN : 00050671