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Shri Lakshmi Cotsyn Ltd
Industry :  Textiles - Processing
BSE Code
ISIN Demat
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As on: Sep 30, 2023 05:40 PM

Your Directors have the pleasure in presenting the 31st Annual Report along with the Audited financial statements of the Company for the financial year ended on 31st March, 2019:


Highlights of financial results (Stand-alone & Consolidated) for the year were as under:

(Rs. in Crores)






Stand Alone

Stand Alone



Sales and other income 61.49 195.79 61.58 195.84
Operating profit before interest, depreciation and tax (41.10) (22.06) (41.04) (22.09)
Interest and other financial charges 0.08 2.14 0.08 2.14
Depreciation 83.73 87.35 84.65 88.16
Exceptional Items 0.04 16.40 0.04 5.72
Prior period item - - - (1.10)
Profit/ Loss before tax (124.95) (127.95) (125.81) (118.11)
Less: Income Tax (including deferred tax) - - 0.09 0.04
Profit/ Loss after tax (124.95) (127.95) (125.72) (118.07)
Proposed dividend - - - -
Dividend tax - - - -
Balance carried to balance sheet (124.95) (127.95) (125.72) (118.07)


Performance Highlights - Stand-alone:

Your Directors wish to inform you that during the year 2018-19, Company faced lot of problems on account of financial stress hence operations of the units were restricted between 5% to 10% of its installed capacity and that too on job work basis due to the non-payment of salary to the workmen and staff. Since February 2019, all the units of the Company were closed.

During 2018-19, the Company recorded sales and other income at Rs. 61.49 crores as compared to Rs. 195.79 crores in 2017-18. The loss (before/after tax) has been decreased to Rs. (124.95) crores in 2017-18 as compared to Rs. (127.95 ) crores in 2017-18 due to more capacity utilization on account of job work.

Performance Highlights - Consolidated:

During 2018-19, the Company recorded consolidated sales and other income at Rs. 61.58 crores as compared to Rs. 195.84 crores in 2017-18. During the year 2018-19, the profit/loss before tax has been increased to Rs. (125.81) crores as compared to Rs. (118.11) crores in 2017-18. The profit/loss after tax stood at Rs. (125.72) Crores in 2018-19 as compared to Rs (118.07) crores in 2017-18.


Till January 2019, the Company was doing Job work only. During the year, company has generated revenue only from job work in view of imported machinery, state of art infrastructure and superior quality products of the Company. Jobwork has enabled the company to reduce its cash losses & increase its capacity utilization..


Hon'ble National Company Law Tribunal (NCLT), Allahabad bench vide Order dated 30.05.2018 has admitted the petition filed by Union Bank of India under Section 7 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as "Code") on behalf of the Financial Creditor against the Company. The Company has filed an application seeking directions from this Hon'ble Adjudicating authority to grant an opportunity to submit a proposed resolution plan and further permit the applicant to run the Company as a going concern.

Mr. Rohit Sehgal, Partner of AAA Insolvency LLP having Insolvency Professional Registration no. IBBI/IPA-001/IP-P00528/2017-18/10953 , Resolution Professional ("RP") has taken over the possession of all the units of the company through security agency and the powers of the existing Board of Directors of the Company has been suspended.

Mr. Sehgal has started the activities towards Corporate Insolvency Resolution Process (CIRP) and appointed Valuer, Forensic Auditor and also floated Expression of Interest to the prospective Investors. But no Resolution Plan for revival of the Company has been received till date. However the existing promoters/management has submitted a settlement plan with NCLT under Section 12A of IBC which is under consideration as yet.


As already mentioned that the Company is under Corporate Insolvency Resolution Process (CIRP) and undergoing with the moratorium period, hence all the Winding-up petitions and Civil suits against the Company are stayed. However, the moratorium period declared by the Hon'ble National Company Law Tribunal (NCLT) does not cover the promoters/guarantors of the company, hence they are contesting the cases filed by the Banks at DRT, Delhi separately.

Besides, the promoters/guarantors are also contesting the cases filed by the Central Bank of India under Section 138 of Negotiable Instrument Act. A List of all the cases shall be available for inspection at ensuing Annual General Meeting .


Despite of all the adverse situations, the Company recorded an export of Rs 12.33 crores in 2018-19 as against Rs 41.44 crores in 2017-18 on Stand-alone basis as well as on Consolidated basis.


The Company has three subsidiary companies which are non-operational at presnt, details of which are as under:

M/s Shri Lakshmi Defence Solutions Ltd.

The company was incorporated on 19.12.2006 and was engaged in manufacturing of bullet proof jacket, bullet proof helmet, armored vehicles, bullet proof morchas and other ballistic products for defense and homeland security. Due to the scarcity of working capital, the Company could not operate its functioning and also could not repay its loan of the Bank of Baroda .The Bank after turning its account as NPA has taken over the possession of the unit and was trying to sale the unit as such. The Company has obtained stay order from DRT Allahabad against the sale of unit.

The company has not generated any sales like previous year as the Company has not done any business but earned other income of Rs. 8,87,291.00 in the financial year 2018-19, as compared to other income of Rs. 4,54,371.00 in the previous financial year 2017-18. The Company has incurred a loss of Rs. (76,62,476/-) during the F.Y. 2018-19, in comparison to a loss of Rs. (76,18,874/-) for the F.Y. 2017-18

M/s SLCL Overseas FZC, Sharjah U.A.E

The Company is a 100% subsidiary of SLCL, which has been set up at Sharjah Airport International Free Zone, Sharjah, at UAE. It was engaged in trading of 100% Polyester fabric material, garments and alike products. During the year 2018-19, the Company has not done any business, therefore there is no turnover or profit in the year 2017-18 as in the previous year 2017-18.

M/s Synergy Global Home Inc.

M/s Synergy Global Home Inc., is a wholly-owned subsidiary and was incorporated at U.S.A.; which was dealing in trading of home furnishing items. During the year 2018-19, M/s Synergy Global Home Inc. has not done any business as in the previous year 2017-18, therefore there is no turnover or profit/loss in the year 2018-19. Further there are other two non-operational subsidiaries viz., M/s ShriLakshmi Power Limited and M/s Shri Lakshmi Nano Technologies Limited of Shri Lakshmi Cotsyn Limited under section 2(87) of the Companies Act 2013. However since incorporation both the companies are not in operation, therefore consolidated Financial statement of M/s Shri Lakshmi Cotsyn Limited does not include the financial statement of M/s ShriLakshmi Power Limited and M/s Shri Lakshmi Nano Technologies Limited


In pursuance with the provisions of Section 129 of the Companies Act, 2013, the requirement of attaching the Financial Statements, Auditors' Report and Directors' Report of the subsidiaries concerned has been dispensed with and therefore, Board of Directors of your Company have given their consent for not attaching the balance sheet of the subsidiary concerned. The Statement in Form AOC-1 containing the salient features of the financial statements of your Company's subsidiary companies pursuant to first proviso to Section 129(3) of the Act read with Rule 5 of the Companies (Accounts) Rules, 2014, forms part of the Annual Report.

The Annual Accounts of the subsidiary companies shall also be kept for inspection by any shareholders at the Registered Office of the holding Company on any working day and of the subsidiary companies concerned. The Company shall furnish a hard copy of details of accounts of subsidiaries to any shareholder on demand.


Changes in Directors and Key Managerial Personnel :

During the financial year 2018-19, there has been no change in Directors. However, Prof. (Dr.) Rakesh Kumar Trivedi, an Independent Director of the company has expressed his intention to resign from the post of Directorship due to his busy schedule and therefore, the Board at its Meeting held on 14th June 2019 has considered and approved his resignation w.e.f. 14.06.2019

Appointment of Mr. R.L. Agarwal as Chief Financial Officer (CFO) of the Company:

Further, in compliance with the provisions of Section 203 of the Companies Act, 2013 read with Rule 8 of the Companies (Appointment and Remuneration of Managerial Person) Rules, 2014 and other applicable provisions, the Board of Directors of the Company at their meeting held on 14.06.2019, have appointed Mr. R.L. Agarwal as Chief Financial Officer (CFO) of the Company with effect from 14.06.2019.

Declaration by an Independent Director (s) & re- appointment, if any

A declaration by an Independent Director that he meets the criteria of independence as provided in sub-section (6) of Section 149 of the Companies Act, 2013 has been obtained.

Number of meetings of the Board of Directors

A calendar of Meetings is prepared and circulated in advance to the Directors. During the Financial year 2018-19, 5 (five) meetings of Board of Directors were held. The meetings were held on 06th June 2018, 13th August 2018, 5th September 2018, 14th November 2018 and 14th February 2019. The maximum time gap between any two meetings was not more than four calendar months.

Audit Committee

The composition of an Audit Committee and details of meeting are stated in the Corporate Governance Report.

Details of establishment of vigil mechanism for directors and employees

The vigil mechanism for directors and employees to report genuine concerns has been established as per the provisions of Section 177(9) read with Rule 7 of the Companies (Meeting of Board and its Powers) Rules, 2014 for directors and employees to report their genuine concerns or grievances.

Particulars of loans, guarantees or investments under section 186:

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

Related Party Transactions:

All related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Listing Regulations , the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Finance, Audit Grievance, Nomination & Remuneration and Compliance Committees etc. The Management evaluates the performance of committees and its functioning at regular intervals.

Remuneration & Nomination Policy

The Board has framed a policy which lays down the framework in relation to selection and appointment of Directors, Senior Management of the Company and in relation to their remuneration.

Risk Management Policy:

A statement indicating development and implementation of a risk management policy for the Company are set out in the corporate governance report forming part of the Board report.

Share Capital

During the Financial Year 2018-19, the Company has not issued any equity shares, so there has been no change in share capital.


Since the Company and its subsidiaries have incurred the loss, hence question of declaration of any dividend for the year ended on 31st March, 2019 does not arise.

Transfer of unpaid and unclaimed dividend amount/ shares to Investor Education and Protection Fund: Pursuant to the applicable provisions of the Companies Act 2013 and the rules made thereunder, all unpaid and unclaimed dividends are transferred by the Company to the pertaining Investor Education and Protection Fund after the completion of 7 years. Further pursuant to the provisions of these Rules, shares in respect of whom the dividend hasn't been claimed by the shareholders, has been credited to a Dematerialisation Account of the Authority. Accordingly the Company has transferred unpaid and unclaimed dividends pertaining to the financial year 2010-11 amounting to Rs. 6, 78,522/- and also 41,357 number of equity shares were transferred during the financial year under review. Please note that no claim shall lie against company in respect of the unclaimed dividend/ shares transferred to the IEPF Authority. However, the unclaimed shares/dividend can be claimed from the IEPF by making necessary application in the prescribed Form available on website www.iepf.gov.in



Pursuant to the provisions of Section 139 of the Act read with Companies (Audit and Auditors) Rules, 2014, as amended from time to time, M/s Tandon & Tandon, Chartered Accountants (Firm Registration No. 002070C), were appointed as the Statutory auditors of the Company to hold office for a period of five consecutive years from the conclusion of the 29th Annual General Meeting of the Company held on 26th September 2017, till the conclusion of the 34th Annual General Meeting to be held in the year 2022, subject to ratification by shareholders at each Annual General Meeting or as required under law.

Accordingly, the necessary resolution for appointment of auditors is being placed before the shareholders for ratification.


The Central Government's Cost Auditor order specifies an audit of cost accounting records of the textile Company every year. This is applicable to the products manufactured by the Company . The Board of Directors, subject to the approval of the Central Government, ratified the appointment of Mr. Arun Kumar Srivastava, Cost Accountants, Kanpur, to carry out cost audit for the current year 2019-20.


The Company ratified the appointment of a firm of Chartered Accountants M/s Srivastava S and Company of Kanpur as internal auditors to review the internal control systems of the Company and report thereon. The Report of the Internal Auditors is reviewed by the Audit Committee.


Pursuant to the provisions of Section 204(1) of the Companies Act 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. Sanjiv Nigam, Company Secretary in Practice, (C. P. No. 8458) to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit is annexed herewith as "Annexure A".


With an increasing concern towards ecology and global warming, consumers are favoring organic and eco-friendly textile products. Therefore, the demand of organic cotton is accelerating with brands and retailers continuing to implement long-term commitment to increase their use of organic cotton. Your Company also continues to pursue its mission for environmental excellence and constantly explores opportunities to improve ecology and the environment.


The company posses in-house R&D facilities which results in cost saving. The continuous R&D efforts enabled the company to product innovation.

Company's R&D strategy is anchored on the development and speedy commercialization of globally competitive products, processes and technologies through best-in-class research interventions backed by world-class infrastructure. It has a strong R&D cell for advanced testing laboratories.


All the insurable assets of your Company including inventories, building, plant and machinery were adequately insured.


The Corporate Governance and Management Discussion & Analysis Report, which form an integral part of this Report, forms part of this Report and is annexed in the Annual Report, together with the Certificate from the auditors of the Company regarding compliance with the requirements of Corporate Governance as stipulated in the Listing Regulations.


In accordance with MCA's circulars bearing no.17/2011 dated 21.04.2011 and 18/2011 dated 29.04.2011, your company mails documents and various other notices (including notice calling Annual General Meeting, Audited Financial Statements, Directors' Report, Auditor's Report etc) to the shareholders through electronic mode to the registered e-mail addresses of shareholders.


(A) Particulars of employees

The industrial relations throughout the year under review remained cordial except from the month of June 2018 when CIRP started and workers felt that their jobs are unsafe.

As none of the employees of the Company was in receipt of remuneration in excess of the limits prescribed, hence the particulars of employees under the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are not given in the report.

(B) Conservation of energy, technology absorption and foreign exchange earnings and outgo

Particulars with respect to conservation of energy, among others, as required under Section 134(3) clause (m) of the Companies Act, 2013 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are set out in the Annexure forming part of this Report.

(C) Directors' responsibility statement

As required under clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, your Directors confirm that:

1. In the preparation of the annual accounts, the applicable accounting standards were followed and there are no material departures;

2. The Directors selected such accounting policies and applied them consistently and made judgments' and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for the period;

3. The Directors took proper and sufficient care to maintain adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. The Directors prepared the annual accounts on a going concern basis.

5. The Directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

6. The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.


None of the Directors are disqualified under the provisions of Section164 (2) of the Companies Act, 2013. The Directors have made the requisite disclosures, as required under the provisions of the Companies Act, 2013 and the Listing Regulations.

Extract of the Annual Return :

The extract of the annual return in Form No. MGT - 9 shall form part of the Board's report. The details forming part of the extract of the Annual Return in form MGT-9 is annexed herewith as " Annexure C".

Corporate Social Responsibility (CSR)

The disclosures under Rule 9 of Companies (Corporate Social Responsibility Policy) Rules, 2014 is not required to be made since clause (o) of sub-section (3) of section 134 of the Act and Rule 9 of the Companies (Corporate Social Responsibility) Rules, 2014 is not applicable to the Company.


The information required under Section 197 of the Act read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below-

(i) The ratio of the remuneration of each director/KMP to the median remuneration of the employees of the company and the percentage increase in remuneration of each director for the financial year 2018- 19 are given below:

S. No. Name of KMP Remuneration as on
As on 31.03.2019 As on 31.03.2018 Percentage increase in remuneration Ratio to median remuneration
(Annual) (monthly)
1. Dr. M.P. Agarwal 400000 200000 nil 4:1
2. Mr. Pawan Kumar Agarwal 250000 125000 nil 2.5:1
3 Mr. Devesh Narain Gupta 2400000 200000 nil 24:1
4 Mrs. Sharda Agarwal 125000 62500 nil 1.25 :1
5 Prof. Dr. R.K Trivedi* 0 0 nil -
6 Mr. Rakesh Kumar Srivastava 1560000 130000 nil 15.6:1

*RESIGNED W.E.F. 14.06.2019

(ii) Percentage increase in the median remuneration of employees in the financial year: nil

(ii) Number of permanent employees on the rolls of company as on 31.03.2019: 2150

(iv) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:

There has been no percentile increase in the salaries of Employees and Key Managerial Personnel in comparison with the increase in the remuneration of other employees for the same period .

(v) The key parameters for any variable component of remuneration availed by the directors:


(vi) Affirmation that the remuneration is as per the remuneration policy of the Company:

The Company affirms that remuneration is as per the remuneration policy of the Company.

Information as per Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:

Statement showing the names of Top 10 Employees in terms of remuneration drawn during the year:

S. N o. Employee Name Designation Remunera tion received ( CTC ) per month Educational Qualification & Experience Date of commence ment of employmen t Age Previous employment & Designation
1 Rakesh Arya Sr. Manager 85000 B. Tech , 21 years 23/10/2013 42 years JCT Mills Pvt. Ltd. Fagwada , Manager
2 Abhishek Pandey Manager 80000 Diploma in Manmade Textile chemistry 17-06-2014 39 Wellspun India Ltd. – Deputy Manager
3 Neeraj Prasad Verma General Manager 78347 B. Tech 54 Shamken Multifab Ltd. Koshi kalan, Mathura. - Sr. Engineer
4 Ram Babu DGM 76500 BA 25-11-2013 48 Orient Bell Ltd. Sikandra Bad, Bulandshher - Manager
5 Subhash Chand Jain VP (Finance) 150000 MSC (Phy.), 45 yrs 07/12/2010 68 Shamken Spinners Ltd, Dy. GM
6 Sujala Gupta Manager 99,975 M.A., 15 years 01/04/2004 62 -
7 Rajeev Anand General Manager 117116 B.Sc, 27 yrs. 11/04/2015 49 OSIL Home Furnishing Products Panipat, General Manager Production
8 Sudha Jain Manager 87000 BSC , 10 years 01/04/2010 65 -
9 Sandeep Chaturvedi DGM 76000 Bsc 10-12-2014 49 Model Denim Ahemdabad – Joint Vice President
10 Devender Singh Rana Manager 73289 Diploma in Mechanical 15.05.2012 54 Chinab Textile J & K, Deputy Manager



? Nature of employment for above mentioned employees are permanent.

? None of the above mentioned employees are holding any percentage of equity shares in the company within the meaning of clause (iii) of sub-rule (2) above except Mrs. Sujala Gupta; and

? None of the above mentioned employees is a relative of any director or manager of the company .

Details of employees drawing a remuneration of Rs. 1.02 crores or above per annum if employed throughout the financial year or Rs. 8.50 Lacs per month if employed for any part of the year and posted in India: NIL


Your Company respects and values diversity reflected in various backgrounds, experiences, and ideas and is committed to providing employees with a workplace that is free from discrimination or harassment. The Company has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Company has Internal Complaints Committee (ICC) established in accordance with the aforesaid Act for addressing sexual harassment incidents. No complaints on sexual harassment were received by the Company during the financial year under review.


Your Directors wish to place on record their appreciation of the support provided by the Company's bankers, all the vendors and tie-up entities and the dedication and commitment of the employees at all levels. Your Directors convey their grateful thanks to all the Government authorities and shareholders for their continued and unstinted assistance, co-operation and patronage. Your Directors also whole heartedly thanks to Resolution Professional Mr. Rohit Shegal for his untiring effort in running the units.We also take this opportunity to thank all the valued customers who have appreciated our products and have patronized them.

For and on behalf of the Board
Dr M P Agarwal Pawan Kumar Agarwal
Place: Kanpur (Chairman and Managing Director) (Joint Managing Director)
Date: 30th October 2019 DIN:00311806 DIN:00311954