explanatory statement
The following Explanatory Statement, pursuant to Section 102 of the Companies Act, 2013 ("Act"), sets out all material facts relating to the business mentioned at Item Nos. 4 to 12 of the accompanying Notice dated May 29, 2014:
Item No.4
This explanatory statement is provided though strictly not required as per Section 102 of the Act.
Deloitte Haskins & Sells (DHS) Chartered Accountants (ICAI Firm Registration No. 117366W), Mumbai were appointed as the statutory auditors of the Company for the financial year 2013-14 at the Annual General Meeting (AGM) of the Company held on August 21, 2013. DHS converted itself into a Limited Liability Partnership (LLP) under the provisions of the Limited Liability Partnership Act, 2008 and is now known as M/s Deloitte Haskins & Sells LLP, Chartered Accountants (ICAI Firm Registration No. 117366W/W – 100018) with effect from November 20, 2013. In terms of the Ministry of Corporate Affairs, Government of India, General Circular No. 9/2013 dated April 30, 2013, the Board of Directors of the Company have taken due note of this change.
DHS LLP have been the Auditors of the Company since FY 2006-07 and have completed a term of eight years. As per the provisions of Section 139 of the Act, no listed company can appoint or re-appoint an audit firm as auditor for more than two terms of five consecutive years. Section 139 of the Act has also provided a period of three years from the date of commencement of the Act to comply with this requirement.
In view of the above, DHS LLP, being eligible for re-appointment and based on the recommendation of the Audit Committee, the Board of Directors has, at its meeting held on May 29, 2014, proposed the appointment of DHS LLP as the statutory auditors of the Company for a period of three years to hold office from the conclusion of this AGM till the conclusion of the seventy-second AGM of the Company to be held in the year 2017 (subject to ratification of their appointment at every AGM).
The Board commends the Resolution at Item No. 4 for approval by the Members.
None of the Directors or Key Managerial Personnel (KMP) or relatives of Directors and KMP is concerned or interested in the Resolution at Item No. 4 of the accompanying Notice.
Item Nos.5 to 10
The Company had, pursuant to the provisions of Clause 49 of the Listing Agreement entered with the Stock Exchanges, appointed Mr Nusli Wadia, Dr Raghunath Mashelkar, Mr Subodh Bhargava, Mr Nasser Munjee, Mr Vineshkumar Jairath and Ms Falguni Nayar as Independent Directors at various times, in compliance with the requirements of the said clause.
As per the provisions of Section 149(4) which has come into force with effect from 1st April, 2014, every listed company is required to have at least one-third of the total number of Directors as Independent Directors. Further, Section 149(10) of the Act provides that an Independent Director shall hold office for a term up to five consecutive years on the Board of a company and is not liable to retire by rotation pursuant to Section 149(13) read with Section 152 of the Act.
The Securities and Exchange Board of India (SEBI) has amended Clause 49 of the Listing Agreement which would be effective from October 1, 2014 inter alia stipulates the conditions for the appointment of Independent Directors by a listed company.
The Nomination & Remuneration Committee has recommended the appointments of these Directors as Independent Directors from July 31, 2014 upto July 30, 2019 except for Mr Nusli Wadia, Dr Raghunath Mashelkar and Mr Subodh Bhargava who would be retiring on February 14, 2019, December 31, 2017 and March 29, 2017 respectively on attaining the age of 75 years in accordance with the retirement age policy for Directors.
The above Independent Directors have given a declaration to the Board that they meet the criteria of independence as provided under Section 149 (6) of the Act. In the opinion of the Board, the above Independent Directors fulfill the conditions specified in the Act and the Rules made thereunder for appointment as Independent Directors and they are independent of the management.
In compliance with the provisions of Section 149 read with Schedule IV of the Act, the appointment of the above Directors as Independent Directors is now being placed before the Members in General Meeting for their approval.
The terms and conditions of appointment of Independent Directors shall be open for inspection by the Members at the Registered Office of the Company on all working days, except Saturdays, during business hours upto the date of the Meeting.
The brief profile of the Independent Directors to be appointed is given below:
Mr Nusli Wadia
Educated in the UK, Mr Wadia is the Chairman of the Bombay Dyeing & Manufacturing Company Limited and heads the Wadia Group. He is also the Chairman/Trustee of various charitable institutions and non-profit organisation.
Mr. Wadia has been on the Company's Board since December 22, 1998 and is an Independent Director.
Dr Raghunath Mashelkar
Dr Mashelkar is an eminent chemical engineering scientist retired from the post of Director General from the CSIR and is the President of Indian National Science Academy (INSA), National Innovation Foundation, Institution of Chemical Engineers, UK and Global Research Alliance. The President of India honored Dr Mashelkar with the Padmashri (1991), the Padmabhushan (2000) and the Padma Vibhushan (2014). Dr Mashelkar holds a Ph.D. in Chemical Engineering from the Bombay University.
He was appointed as an Independent Director of the Company w.e.f. August 28, 2007.
Mr Nasser Munjee
Mr Nasser Munjee served with HDFC for over 20 years at various positions including as its Executive Director. He was the Managing Director of Infrastructure Development Finance Co. Ltd. (IDFC) up to March 2004. Presently he is the Chairman of Development Credit Bank (DCB) since June 2005 and is also on the Board of various Multinational Companies and Trusts.
Mr Munjee is a Technical Advisor on the World Bank-Public Private Partnership Infrastructure and Advisory Fund. Mr Munjee holds a Bachelor's degree and a Master's degree from the London School of Economics, UK.
He was appointed as an Independent Director of the Company w.e.f. June 27, 2008.
Mr Subodh Bhargava
Mr Bhargava retired from Eicher Group of Companies as Group Chairman and Chief Executive in March 2000. He was the past President of the Confederation of Indian Industry (CII) and the Association of Indian Automobile Manufacturers and the Vice President of the Tractor Manufacturers Association.
He is currently associated as a Director of several Indian corporates, including Tata Communications Limited and Tata Steel Limited. Mr Bhargava holds a degree in Mechanical Engineering from the University of Roorkee.
He was appointed as an Independent Director of the Company w.e.f. June 27, 2008.
Mr Vineshkumar Jairath
Mr Jairath served as the Principal Secretary (Industries), Government of Maharashtra and has over 25 years of experience in public administration, rural development, poverty alleviation, infrastructure, finance, industry, urban development, environmental management and a touch of the private sector occupying various important positions in the Government of India and the State Government of Maharashtra.
Mr Jairath holds Bachelor of Arts Degree in Public Administration and Bachelor of Laws Degree, both, from the Punjab University, Masters in Economics from the University of Manchester, UK and joined Indian Administrative Service in 1982.
He was appointed as an Independent Director of the Company w.e.f. March 31, 2009.
Ms Falguni Nayar
Ms Falguni Nayar has spent over 19 years with Kotak Mahindra Bank with the last 6 years as Managing Director and CEO of Kotak Investment Bank. She is currently the founder and CEO of Nykaa.com, an online shopping website for beauty and wellness products and also offers an online magazine, expert advice and virtual makeover tools.
She was recognised as the 'Top Business Woman' by Business Today in 2009 and 2011 and has received the FICCI Ladies Organisation award for 'Top Woman Achiever' in the field of banking in 2008. She holds a B.Com degree from the Mumbai University and a PGDM from IIM, Ahmedabad.
She was appointed as an Independent Director of the Company w.e.f. May 29, 2013.
The Board commends the Ordinary Resolutions set out at Items Nos. 5 to 10 of the Notice for approval by the Members.
The above Independent Directors are interested in the Resolutions mentioned at Item Nos. 5 to 10 of the Notice with regard to their respective appointments. Other than the above Independent Directors, no other Director, Key Managerial Personnel or their respective relatives are concerned or interested in the Resolutions mentioned at Items Nos. 5 to 10 of the Notice.
Item No.11
The Board had on May 29, 2014 on the recommendation of the Audit Committee, approved the appointment and remuneration of M/s Mani & Co., the Cost Auditors to conduct the audit of the Cost records pertaining to motor vehicle and other revelent product groups maintained by the Company for the Financial Year ending March 31, 2015 and remuneration of Rs.20,00,000/- plus service tax, out-of-pocket, travelling and living expenses have been fixed for this purpose.
In accordance with the provisions of Section 148 of the Act read with the Companies (Audit and Auditors) Rules, 2014, ratification for the remuneration payable to the Cost Auditors for the Financial Year 2014-15 by way of an Ordinary Resolution is being sought from the members as set out at Item No.11 of the Notice.
The Board commends the Ordinary Resolution set out at Item No.11 of the Notice for approval by the Members.
None of the Directors or Key Managerial Personnel of the Company or their relatives is, in any way, concerned or interested, in the resolution set out at Item No.11 of the Notice.
Item No.12
The Board of Directors at their meeting held on May 29, 2014, have in-principle approved and recommended the invitation and acceptance of Fixed Deposits from the members and public pursuant to Sections 73 and 76 of the Companies Act, 2013 ("Act") and Companies (Acceptance of Deposits) Rules, 2014 ("Rules") as one of the modes to meet the ongoing fund requirements of the Company. The Fixed Deposit program would be credit rated on an annual basis and the Company may provide deposit insurance cover, if required under the Act read with the said Rules. It is proposed to authorise the Board or a committee thereof to negotiate and finalise the terms of Fixed Deposit Scheme and to do such other acts and deeds as may be necessary or incidental thereto.
In compliance with the provisions of Section 73 and 76 of the Act, read together with Rule 2(e) of the Companies (Acceptance of Deposits) Rules, 2014, approval of the Members by way of special resolution is being sought. The Company has vide Postal Ballot Notice dated May 22, 2014 sought the approval of the members to empower the Board to borrow upto an amount of Rs.30,000 crores (apart from temporary loans obtained or to be obtained from the Company's bankers in the ordinary course of business) pursuant to Section 180 (1) (c) of the Act and the results of the Ballot would be announced on June 30, 2014. The funds to be borrowed through the Fixed Deposits program would be within the said borrowing limit.
The Board commends the Resolution set out at Item No.12 of the Notice for approval by the Members.
None of the Directors or Key Managerial Personnel of the Company or their relatives is, in any way, concerned or interested, in the said resolution, except to the extent of any Fixed Deposits that may be placed with company by the them, their relatives or by the companies/institutions in which they are directors.
By Order of the Board of Directors
h k sethna
Company Secretary
Mumbai, May 29, 2014
Registered Office:
Bombay House, 24, Homi Mody Street, Mumbai 400 001
Tel: +91 22 6665 8282 Fax: +91 22 6665 7799
Email: [email protected] Website: www.tatamotors.com
CIN - L28920MH1945PLC004520