The State Trading Corporation of India Limited
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ANNUAL REPORT 2018-19 THE STATE TRADING CORPORATION OF INDIA LIMITED REGISTERED & CORPORATE OFFICE (CIN: L74899DL1956GOI002674) Jawahar Vyapar Bhawan, Tolstoy Marg, New Delhi-110001 Tel.: #011-23313177, Fax #011-23701123, 23701191 Email: [email protected] Website: www.stclimited.co.in BOARD OF DIRECTORS CMD AND FUNCTIONAL DIRECTORS Shri Rajiv Chopra, Director (Marketing) [Addl. Charge of CMD] Shri Sanjeev Kumar Sharma, Director (Personnel) Shri Umesh Sharma, Director (Finance),MMTC with Addl. Charge of STC Shri Prasanta Kumar Das, Director (Marketing) (upto 31.03.2019) Shri Ashwani Sondhi, Director (Marketing) MMTC with Addl. Charge of STC (from 01.04.2019 upto 24.07.2019) Shri N.A.N. Jeyakumar, Director (Marketing) (from 12.06.2019) PART-TIME OFFICIAL DIRECTORS (GOVERNMENT NOMINEES) Shri Sunil Kumar, AS, Dept. of Commerce (from 21.10.2017) Shri Subhash Chandra Pandey, SS&FA, Dept. of Commerce (from 27.03.2018 upto 30.06.2019) PART-TIME NON-OFFICIAL DIRECTORS (INDEPENDENT DIRECTORS) Dr. Amitabh Rajan (from 14.02.2017) Shri Mohan Lal Pareek (from 14.02.2017) Ms. Bharathi Magdum (from 24.03.2017) Shri Bharatsinh Parmar (from 31.03.2017) Dr. N.Sundaradevan (from 03.08.2016 upto 14.06.2019) Dr.K.Rangarajan (from 03.08.2016 upto 14.06.2019) Shri Sunil H. Trivedi (from 03.08.2016 upto 14.06.2019) Shri Arvind Gupta (from 03.08.2016 upto 14.06.2019) COMPANY SECRETARY Shri Deepak C S REGISTRAR & SHARE TRANSFER AGENT STATUTORY AUDITORS MCS Shares Transfer Agent Limited M/s. Thakur Vaidyanath Aiyar & Co st F-65, 1 Floor, Okhla Industrial Area, No. 221-223, Deen Dayal Marg, Phase-I, New Delhi 110020 New Delhi 110002 Tel: 011-41406150 Tel: 011- 2323 6958 E-mail: [email protected] BANKERS SECRETARIAL AUDITORS State Bank of India Allahabad bank M/s. P.C. Jain & Co, Bank of Baroda Bank of India Company Secretaries, Canara Bank Indian Overseas Bank 2382, Ist Floor, Sector-16 Indian Bank ICICI Bank Faridabad-121002 UCO Bank Syndicate Bank Vijaya Bank Union Bank of India HDFC Bank ICBC Bank Indusind Bank Axis Bank IDBI Bank CONTENTS 1 Board’s Report 2018-19 along with the following Annexures: 5-11 I Management Discussions & Analysis Report 12-16 II Extract of Annual Return (MGT-9) 17-28 III Annual Report on CSR Activities 29-30 IV Report on Corporate Governance 31-48 V Compliance Certificate on Corporate Governance 49-51 VI Secretarial Auditors’ Report 52-54 2. Highlights: Ten Years at a Glance 55 3. Standalone Financial Results 56 • Independent Auditors’ Report 57-68 • Accounts for the year 2018-19 69-125 • Management’s Replies to Statutory Auditor’s Report 126-130 • CAG Comments 131-132 4. Statement Pursuant to Section 129(3) of the Companies Act., 2013 133 related to subsidiary Company and Joint Ventures 5. Consolidated Financial Results 134 • Independent Auditors’ Report 135-142 • Accounts for the year 2018-19 143-203 • Management’s Replies to Statutory Auditor’s Report 204-208 • CAG Comments 209-210 6. Green Initiative in Corporate Governance: Go Paperless 211 BOARD’S REPORT The Board of Directors presents the 63rd Annual Report on During the year 2018-19, pursuant to Hon’ble Supreme Court the business and operations of the Company and its Audited Order dated 06.12.2018, the Company recovered an amount Statement of Accounts for the year ended March 31, 2019 of `1400 Crore from one its major debtors, namely, GSHL/ together with the Auditors’ Report and Comments on the GSPI. With a view to settle the outstanding dues of banks, Accounts by the Comptroller and Auditor General (CAG) of the Company had submitted a One Time Settlement (OTS) India. proposal to the lender banks. After a series of meetings held FINANCIAL RESULTS with the Joint Lenders Forum (JLF) of banks and discussions/ The performance of the Company during the year 2018-19 vis- meetings held at various other platforms, the broad terms of à-vis the previous year is summarized in the table below: settlement have been finalised with the lender banks. Out of the total dues of `1906 Crore approx. (as on 31.12.2018) (` Crore) crystallized with the lender banks, an amount of `1100 Crore TURNOVER 2018-19 2017-18 has already been paid by STC to the lender banks. The balance Exports 11 266 amount is also proposed to be paid partly through sale of its immovable properties and partly out of the trade receivables to Imports 8437 10216 be realized by the Company. Domestic 445 343 In the meantime, the lender banks had filed petitions against Grand Total 8893 10825 STC in DRT/NCLT and the proceedings are going on. FINANCIALS The Company is in the process of entering into Master Profit Before Tax (897) 32 Restructuring Agreement (MRA) with the lender banks towards Profit After Tax (881) 38 settlement of their dues. Net Worth (833) 46 DIVIDEND The Board of Directors has not recommended any dividend for OPERATIONS AND BUSINESS PERFORMANCE the year 2018-19 in view of current liquidity crunch, difficulties During the year 2018-19, the Company achieved a total in borrowing adequate funds from banks for its day-to-day turnover of `8,893 Crore as against `10,825 Crore achieved working capital requirement and net loss of approx. `881 in the previous year. The decline in turnover was mainly due Crore reported by the Company during the year 2018-19. to lower import of bullion as well as inability of the Company to undertake trade transactions due to non-availability of (OTHER EQUITY) RESERVES working capital. During the year, the Company continued to An amount of `870.82 Crore (including revaluation reserve of focus on undertaking business with central/state government `884.60 Crore) was available in the other equity of the company departments and their entities, where there is no involvement as on 01.04.2018. An amount of (-) `879.46 Crore (PAT : (-) of STC’s funds. `881.08 Crore and other comprehensive income `1.62 Crore has been transferred to retained earnings. Accordingly, as on The Company reported a net loss (after tax) of `881 Crore 31st March, 2019, the other equity stood at (-) `8.64 Crore. during 2018-19 as compared to net profit (after tax) of approx `38 Crore reported during the year 2017-18. The net loss HUMAN RESOURCE reported during the year was mainly due to write-offs amounting Manpower to `626 Crore approx made in the books of accounts in respect STC had 441 employees on its rolls as on 31.03.2019, which of GSPI/GSHL and expenses of approx `86 Crore booked included 305 Managers and 136 Staff. towards dues payable to M/s. Helm Dungemittel as per the Recruitments Arbitration award in the matter relating to import of urea on During the year, the Company recruited 2 professionals - Govt. behalf. Company Secretary and Assistant Company Secretary. SETTLEMENT OF OUTSTANDING DUES WITH THE Industrial Relations BANKS During the year 2018-19, the company continued to maintain STC is facing severe liquidity crisis as all the lender banks have harmonious industrial relations. No man days were lost. reported STC’s account as NPA due to non-payment of interest Personnel policies and welfare schemes were suitably improved on the banking limits availed by the Company, Therefore, at / amended so as to bring them in line with the overall business present, the Company has no banking limits, funded or non- interests of the company. funded, available with it. THE STATE TRADING CORPORATION OF INDIA LIMITED | 5 Recruitment of SC/ST/OBC/PWD Measures were also taken for systemic improvements in the The Company has been implementing the Government of areas of record management and timely payment of bills. India’s directives and guidelines for SC/ST/OBC/PWD issued During the year, the vigilance team of the company inspected the from time to time with regard to recruitment of SC/ST/OBC Branch Office, Mumbai. During the visit, CTE Type and surprise and differently abled candidates. inspections were also carried out to check the implementation Human Resource Development of instructions and guidelines issued by the Company from time During the year 2018-19, due to precarious financial position to time. of the company, no budget was allocated for Training and The Company observed Vigilance Awareness Week 2018 Development. However, the Company took initiatives to th rd nominate employees for various training programmes which from 29 October 2018 to 3 November 2018 on the theme had no financial implications. “Eradicate Corruption - Building a New India” at its Corporate Office and Branch Offices. The outreach activities focussing on In all, 10 employees were nominated to attend trainings in inculcating greater awareness on corruption and anti-corruption various domains wherein 21 man days were dedicated. measures were also held in many schools. The school students, OFFICIAL LANGUAGE employees of the Company and citizens were encouraged to In line with the requirements of the Official Language Policy of take E-pledge/Integrity pledge to fight corruption. the Government of India, continuous efforts are being made An interactive workshop/seminar on “Prevention of Frauds’ by the Company for implementation of Official Language was organised on 1st November 2018 for the executives of the Hindi. For this purpose, the employees are being provided necessary training through Hindi workshops. Apart from this, Company. the Official Language Incentive Scheme is in place with the aim With a view to sensitize employees about the critical aspects to of promoting the use of Hindi language in the Company. be kept in view while processing trade financing related matter In view of most of the official work being done in computers and to disseminate information about new developments in in today's era of technology, employees are being trained to the area of procurements, trade and vigilance, an In-house use Hindi and the related e-tools in the day-to-day work of the quarterly e-newsletter “NAI DISHA” containing articles on company.