POLICIES FOR DETERMINING THE MATERIAL SUBSIDIARY (IES)

BACKGROUND

The policy for determining “material” subsidiary has been framed in accordance with the provisions of Regulation 16(1) (c) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (hereinafter called as “Listing Regulations”). The policy will be used to determine Material Subsidiary of the Company and to provide the governance framework for such companies. All the words and expressions used in this policy, unless defined otherwise, shall have meaning respectively assigned to them under the Listing Regulations and in the absence of its definitions or explanations therein, as per the Companies Act, 2013 and the Rules, Notifications and Circulars made thereunder, as amended, from time to time. 

OBJECTIVE

The objective of the policy is to define the Material Subsidiary of SSMD AGROTECH INDIA LIMITED and to provide good corporate governance framework of such subsidiaries in compliance with the applicable regulatory requirements.

DEFINITIONS

The terms and expressions not defined hereunder shall have the meaning as defined under the Companies Act, 2013, SEBI Act, 1992 and Listing (LODR) Regulations.

“Audit Committee” means committee constituted pursuant to Section 177 of the Companies Act, 2013 read with Regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 including any statutory modifications or re-enactments thereof.

“Control” shall have the meaning as assigned to the term in SEBI (Substantial Acquisition of shares and Takeovers) Regulations 2011.

“Independent Directors” shall have the meaning as assigned to the term under Regulation 16(1) (b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 read with Section 149 of Companies Act, 2013 including any modifications, amendments, clarifications, circulars or re-enactments thereof.

“Subsidiary Company” shall means a subsidiary as defined under Section 2(87) of the Companies Act, 2013 and rules related thereto.

IDENTIFICATON OF MATERIAL SUBSIDIARY

A subsidiary shall be considered as material, if its income or net worth exceeds 10 per cent of the consolidated income or net worth respectively, of the company and its subsidiaries in the immediately preceding accounting year.

PROCEDURE AND POLICY

  1. One Independent Director of the company shall be a Director on the board of the material unlisted subsidiary company.
  2. The Audit Committee of the Board of the Company shall review the financial statements, in particular, the investments made by the unlisted subsidiary company.
  3. The minutes of the unlisted subsidiary company shall be placed before the Board of the Company.
  4. The management shall periodically bring to the attention of the Board of Directors of the Company, a statement of all significant transactions and arrangements entered into by the unlisted subsidiary company.

A Transaction or Arrangement shall be considered significant if, it exceeds or is likely to exceed 10 per cent of total revenues or total expenses or total assets or total liabilities, as the case may be, of unlisted subsidiary company for the immediately preceding financial year.

  1. The company shall not dispose of the shares in material subsidiary resulting in reduction of its shareholding (either on its own or together with other subsidiaries) to less than or equal to 50% or cease the exercise of control over subsidiary without passing a special resolution in its General Meeting except in cases where such disinvestments is made under a scheme of arrangement duly approved by Court/ Tribunal or under a resolution plan duly approved under Section 31 of the Insolvency Code and such an event is disclosed to the relevant stock exchanges within one day of the resolution plan being approved.
  2. Selling, disposing and leasing of assets amounting to more than 20 per cent of the assets of the material subsidiary on an aggregate basis during a financial year shall require prior approval of the shareholders of the company by way of Special Resolution in its General Meeting, unless the sale/ dispose/ lease is made under a scheme of arrangement duly approved by Court/ Tribunal or under a resolution plan duly approved under Section 31 of the Insolvency Code and such an event is disclosed to the relevant stock exchanges within one day of the resolution plan being approved.
  3. Every material unlisted subsidiary company incorporated in India shall undertake Secretarial Audit and the Secretarial Audit Report shall be annexed with the Annual Report of the Company.

AMENDMENT

Any change in policy shall be approved by the Board of the Company. The board shall have the right to withdraw/ and or amend any part of this policy or the entire policy, at any time, as it deems fit, or from time to time, and the decision of the Board in this respect shall be final and binding.

In case any provisions of this policy are contrary to or inconsistent with the provisions of Companies Act, 2013 rules framed thereunder and Listing Regulations (“Statutory Provisions”), the provisions of statutory provisions shall prevail.

DISSEMINATION OF THE POLICY

The policy shall be hosted on the website of the company i.e. www.houseofmanohar.com