To
The Members of
Nitin Fire Protection Industries Limited ("the Company or
Corporate Debtor")
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 ('CIRP'):
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 w.r.t.
earlier period) |
- |
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 w.r.t.
earlier period) |
0.34 |
(0.55) |
Profit after Tax |
(655.60) |
(416.87) |
Share of Net Profit / (Loss) of Associates |
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:
"The system of internal financial Controls with reference to
financial statements with regar? 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."
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.
Henee, the operations and management of the Company are being monitored and controlled by
Liquidator in the best possible eapaeity within the provisions of IBC to maintain the
status of the Company as a going concern. As required, the report on Corporate Governanee
has been prepared and signed by the Liquidator being part of this Annual Report as
Annexure III. The Certifieate on Corporate Governanee issued by AVS & Associates,
Company Seeretary, Navi Mumbai, for the financial year ended Mareh 31, 2024 is enelosed 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 Direetors including
independent direetors were suspended due to Liquidation order passed against the Company.
Accordingly, provisions about retirement by rotation of direetors 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
Direetors including independent direetors whieh 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 Seeretary eum
Complianee Offieer, Chief Financial Offieer, Chief Operating Officer resigned from their
position.
e) Declaration by Independent Directors:
The Company was under Liquidation leading to continuance in suspension
of powers of the Board of Direetors, deelarations by the Independent Direetors were not
reeeived 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. Henee, 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 remam 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: liauidation.nfpil@email.com |
Date : 21/01/2025 |
Place : Mumbai |