| Dear Members,
The Directors present to you the 39th Annual report and the Audited
Financial Statements for the Financial Year ended 31st March, 2015
FINANCIAL RESULTS:
Summary of the Company's financial performance for F.Y. 2014-2015 as
compared to the previous financial year is given below:
(Figures in Lacs)
Particulars F.Y. 2014-2015 F.Y. 2013-2014
Income from Textile 357.33 0.00
Income from Share Trading and Finance 307.30 738.43
Total Operational Revenue 664.63 738.43
Other Incomes 1.10 1.25
Total Revenue 665.73 739.68
Profit before Dep & Interest (110.85) (9.62)
Depreciation 0.00 0.00
Interest 0.08 0.00
Profit after depreciation & interest (110.92) (9.62)
Provision for taxation 0.00 0.00
Provision for tax (deferred) (10.15) 0.00
Tax adjustment for earlier years 0.00 0.00
Profit after tax (100.77) (9.62)
Balance carried forward to balance sheet (100.77) (9.62)
HIGHLIGHTS:
During the year your company has diversified its business into textile
business and manage to generate more than 50% revenue out of total
revenue from textile business. During the year under review the total
revenue of the company is '665.73 Lakhs including other income as
compared to '739.68 Lacs in the previous year and thereby registering a
moderate decrease of 10%. This was mainly because of slack market
condition during the year. The volatile market condition affected the
company adversly and resulted in Net loss of (100.77) Lacs against the
Net loss of Rs. (9.62) Lacs in the previous year. The main reason for
incurring such huge loss as compared to previous year is devaluation of
stock and high administrative and business running expenses.
The management of the Company hereby very optimistic regarding
performance of the Company in furture and taking every steps and making
every efferts to turn the Company in to profitable orgnisation.
DIVIDEND:
In view of losses during the year, your Directors have not recommended
any dividend on Equity Shares for the year under review.
BOARD OF DIRECTORS:
During the year under review Ms. Saloni Agrawal due to her pre-
occupation resigned from the directorship of the company w.e.f
13/02/2015. In the same year Mrs. Madhu Rajkumar Goel and Mr. Tushar
Rane also tendered their resignation from the directorship of the
company w.e.f 23/03/2015. The Board is thankful for their efforts and
contribution in the company.
In accordance with the provisions of the Companies Act, 2013, the board
inducted both Mr. Jatinkumar Agarwal and Ms. Seema Sidhu as an
Additional Director of the company in the category of Independent
Director w.e.f 23/03/2015. The Company has received notice in pursuant
to section 160 of the Companies Act, 2013, proposing appointment of Ms.
Seema Sidhu as Independent Director. However Due to sudden demise of
Mr. Jatinkumar Aggarrwal on 17/08/2015, the proposal to appoint him as
and Independent Director of the company cannot be achieved . The
Directors express their profound sorrow at the sad demise. The Company
is thankful for his contribution towards the company.
Ms. Seema Sidhu have given declarations that she meets the criteria of
independence as laid down under Section 149(6) of the Act and Clause 49
of the Listing Agreement.
In accordance with the provisions of the Act and in terms of the
Memorandum and Articles of Association of the Company, Mr. Nirav Shah,
Director of the company retires by rotation at the ensuing AGM and
being eligible, offer himself for reappointment.
The Board also recommended to re-appoint Mrs. Tanu Agarwal, as a Whole
Time Director of the Company, to comply with Section 203 of the
Companies Act, 2013, Whole Time Director for fix term of 5 years w.e.f
11/08/2015.
Profiles of these Directors, as required under Clause 49 of the Listing
Agreement, are given in the Notice of the 39th AGM.
DECLARATIONS GIVEN BY INDEPENDENT DIRECTORS:
All the Non-Executive and Independent Directors have confirmed to the
Board that they qualify to be considered as independent as per the
definition of 'Independent Director' stipulated in Section 149(6) of
the Act and Clause 49(II)(B)(1) of the Listing Agreement. These
confirmations have been placed before, and noted by the Board.
EVALUATION OF BOARD OF DIRECTORS:
Pursuant to the provisions of the Act and Clause 49 of the Listing
Agreement, the Nomination and Remuneration Committee of the Board
carried out the annual evaluation of the performance of the Board as a
whole, the Directors individually as well as of various Committees of
the Board. The performance evaluation of the Independent Directors was
carried out by the Nomination and Remuneration Committee and noted in
turn by the Board.
POLICIES ON DIRECTORS' APPOINTMENT AND REMUNERATION:
The Board has framed a policy which lays down a framework in relation
to remuneration of Directors, Key Managerial Personnel and Senior
Management of the Company.
The key features of the policy are as follows:
1. Criteria for appointment and removal of Director, key managerial
personnel and senior management.
2. Criteria for performance evaluation.
3. Criteria for fixing the remuneration of Director, key managerial
personnel and senior management.
The details of this policy are explained in the Corporate Governance
Report.
DEPOSITS:
Your Company has not accepted any deposits within the meaning of
Section 73 (1) of the Companies Act, 2013.
DIRECTORS' RESPONSIBILITY STATEMENT:
In accordance with the provisions of Section 134 (3) (c) of the
Companies Act, 2013, and based on the information provided by
management, your Directors' state that:
1. In the preparation of the annual accounts for the financial year
ended 31st March, 2015 the applicable accounting standards have been
followed.
2. Accounting policies selected were applied consistently. Reasonable
and prudent judgments and estimates were made so as to give a true and
fair view of the State of affairs of the corporation as at the end of
March 31, 2015 and of the profit of the Company for the year ended on
that date.
3. Proper and sufficient care to the best of their knowledge and
ability for the maintenance of adequate accounting records in
accordance with the provisions of the Companies Act, 2013 for
safeguarding the assets of the Company and for preventing and detecting
fraud and other irregularities.
4. The Annual Accounts of the Company have been prepared on the
ongoing concern basis.
5. That they have laid down internal financial controls commensurate
with the size of the Company and that such financial controls were
adequate and were operating effectively.
6. That systems to ensure compliance with the provisions of all
applicable laws were in place and were adequate and operating
effectively.
AUDITORS:
As per the provisions of section 139 of the Act, no listed company can
appoint/re-appoint an audit firm as auditor for more than two terms of
five consecutive years. Since M/s. Pravin Chandak & Associates,
Chartered Accountants having Registration No. 116627W, has been
Statutory Auditors of the company since last seven years and eligible
to appoint for next three years only hereby retire at the forthcoming
Annual General Meeting and, being eligible, offer themselves for re-
appointment. The Company has received certificate from them under
section 139(1) of the Companies Act, 2013.
AUDITORS REPORT:
Observations made in the Auditors' Report are self-explanatory and
therefore do not call for any further comments under Section 134(1) of
the Companies Act, 2013.
SECRETARIAL AUDIT:
Pursuant to the requirements of Section 204(1) of the Act, and Rule 9
of Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014, the Company has appointed M/s. P.D. Pandya & Associates,
Company Secretary in Practice to conduct the Secretarial Audit for the
financial year 2014-15. The Secretarial Audit Report as received from
M/s. P.D. Pandya & Associates is appended to this Report as Annexure
A.
COMMENTS ON AUDITORS' REPORT:
There are no qualifications, reservations, adverse remarks or
disclaimers made by M/s. Pravin Chandak & Associates., Statutory
Auditors, in their Audit Report.
M/s. P.D. Pandya and Associates, Company Secretary in Practice, in his
Secretarial Audit Report for financial year 2014-15 have drawn the
attention of the management on some the non-compliances, which have
been marked as qualification in his report. In connection with the same
management herewith give the explanation for the same as follow:
Though the Company is doing business of Finance & Investments, Company
had not accepted any deposits from public. The Company is doing
business out of its own fund. However as per section 45IA of Reserve
Bank of India Act, 1934, Company can not do Finance & Investments
business without holding valid Certificate of Registration and which
attracts the penalty of Rs. 5 Lacs u/s 58B (4-A) of the RBI Act, 1934.
However to make good of the said default Company had decided to make
application to RBI for obtaining COR from RBI, however RBI had stop
considering any fresh application for granting COR to existing Company.
With the view of that Company has diversified its business line and
started new business of Trading in Textile and more than 50% of the
total revenue is been generated from Textile Business, which bar the
Company from being NBFC and dispence the requirment of obtaining COR
from RBI and RBI will not impose any penalty and even if penalty
imposed the same will be waived or reduces upon management
re-presenataion.
As far as contigent liablity of Rs.35,16,460/- u/s 147 of Income Tax
Act, 1961 is concered, It is a matter of fact that the demand was
raised by the jurisdictional assessing officer u/s 147 read with
section 143(3) of the Income Tax Act, 1961 for income escaping
assessment conducted by the Income Tax Authorities for the Assessment
Year 2007-08. However the contigent liability for the same is not
provided as the management feels that the demand raised is likely to be
either deleted or substantially reduced as the company has filed appeal
in response to the demand raised by the Assessing Officer.
As far as making of Loan and Advances are concerned, management grants
demand loan only either to the parties known to the Company or by
reference. The Loan and Advances granted by the Company is cosidered as
good and recoverable and do not required any provisions and same has
been closely supervised and monitered on regular basis therefore no
appraisal, renewal, Policies, procedures, committee or documents have
been prescribed and executed.
As pointed out by our Secretarial Auditors in their report, it was a
matter of fact that Income Tax Authority had conducted income tax
search on M/s. Shree Nath Commercial & Finance Limited (Group Company)
on 9th June, 2015 and 10th June, 2015. During their search they had
confiscated Minutes Books and certain other documents for their
reference due to which the company could not produce physical copy of
the minutes books to the secretarial auditor for their verification.
However, the soft copy of the minutes was produced before the auditor
and the same was verified by them.
The size of the Company is very small as compared to its peer group
companies, the Company has also established Risk Management Policy in
place to mitigate unforeseeable risks and frauds. The management things
that Company has adequate internal control system commensurate with the
size of the Company and the Statutory Auditor also conduct test audit
on quarterly basis and submit the limited review certificate and draws
the attention of the management on concerned matters. However the
Management also ensures to strengthen the Internal Control System of
the Company. The Company has appointed M/s. A.M. Gohel & Co. as the
Internal Auditor for conducting periodic internal audit in compliance
of Section 138 of Companies Act, 2013.
Mrs. Tanu Agarwal, Whole Time Director of the Company, was appointed as
the Chief Financial Officer of M/s. Five X Finance & Investment
Limited, a group company as both the companies are group company and
operates from the same place, which allows to devote full time to both
the companies by sitting at same place. However the same contravents
the provision of section 203 of Companies Act, 2013. To ensure the
Compliance with said section Company has suggested to Mrs. Tanu Agarwal
to take resignation from the psot of CFO of M/s. Five X Finance &
Investment Limited and confirmed with Mrs. Tanu Agarwal.
SHIFTING OF REGISTERED OFFICE:
During the year under consideration the Registered Office of the
company has been shifted from Shop No.26, Meera Co.op Hsg Society, New
Link Road, Andheri (West), Mumbai- 400053 to E/109, Crystal Plaza, Opp.
Infinity Mall, New Link Road, Andheri (West), Mumbai- 400053 w.e.f
02/02/2015 for better administration and management of Company's
affairs.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
The particulars of contracts or arrangements with related parties
referred to in Section 188(1), as prescribed in Form AOC - 2 are
appended as Annexure B.
EXTRACT OF ANNUAL RETURN:
Pursuant to the requirements under Section 92(3) and Section 134(3) of
the Act read with Rule 12 of Companies (Management and Administration)
Rules, 2014, an extract of Annual Return in prescribed Form MGT-9 is
given in the Report as Annexure C.
REPORTS ON CORPORATE GOVERNANCE:
The reports on Corporate Governance for the year under review, as
stipulated under Clause 49 of the Listing Agreement form part of the
Annual Report. The certificate from the Auditors of the Company
confirming compliance with the conditions of Corporate Governance is
annexed to the Corporate Governance Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
Further, a separate Management Discussion and Analysis Report covering
a wide range of issues relating to Industry Trends, Company
Performance, SWOT analysis, Corporate Process, Business Outlook among
others is annexed to this Report.
POSTAL BALLOT:
No postal ballot was held during the year 2014-2015.
PARTICULARS OF EMPLOYEES AND RELATED INFORMATION:
The information required pursuant to Section 197 read with rule 5 of
the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 in respect of employees of the Company is as under:
The percentage increase in remuneration of each Director, Chief
Financial Officer and Company Secretary during the financial year
2014-15, ratio of the remuneration of each Director to the median
remuneration of the employees of the Company for the financial year
2014-15 and the comparison of remuneration of each Key Managerial
Personnel (KMP) against the performance of the Company are as under:
Sr. Name of Director/KMP Remuneration
No Received
(In Rs. Lakh)
1 Smt. Tanu Giriraj Kishor Agarwal Nil
(Whole Time Director)
2 Shri. NiravDeepak Shah 0.58
(Executive Director and CFO)
3 Shri. Jatinkumar Chintamani Agarrwal* Nil
(Non-Executive Independent Director)
4 Smt. Seema Nirmal Singh Sidhu* Nil
(Non-Executive Independent Director)
5 Smt. Madhu Rajkumar Goel* Nil
(Non-Executive Independent Director)
6 Shri. Tushar Ramchandra Rane* Nil
(Non-Executive Independent Director)
7 Ms. Saloni GirrajKishor AgrawalA Nil
(Executive Director)
8 Ms. Divya Shashikant Mer 0.22
(Company Secretary)
Sr. Name of Director/KMP % increase in
No Remuneration
in the
Financial year
2014-15
1 Smt. Tanu Giriraj Kishor Agarwal Nil
(Whole Time Director)
2 Shri. NiravDeepak Shah Nil
(Executive Director and CFO)
3 Shri. Jatinkumar Chintamani Agarrwal* Nil
(Non-Executive Independent Director)
4 Smt. Seema Nirmal Singh Sidhu* Nil
(Non-Executive Independent Director)
5 Smt. Madhu Rajkumar Goel* Nil
(Non-Executive Independent Director)
6 Shri. Tushar Ramchandra Rane* Nil
(Non-Executive Independent Director)
7 Ms. Saloni GirrajKishor AgrawalA Nil
(Executive Director)
8 Ms. Divya Shashikant Mer Nil
(Company Secretary)
Sr. Name of Director/KMP Ratio of
No remuneration
of each
Director to median
remuneration of
employees
1 Smt. Tanu Giriraj Kishor Agarwal Nil
(Whole Time Director)
2 Shri. NiravDeepak Shah 0.52
(Executive Director and CFO)
3 Shri. Jatinkumar Chintamani Agarrwal* Nil
(Non-Executive Independent Director)
4 Smt. Seema Nirmal Singh Sidhu* Nil
(Non-Executive Independent Director)
5 Smt. Madhu Rajkumar Goel* Nil
(Non-Executive Independent Director)
6 Shri. Tushar Ramchandra Rane* Nil
(Non-Executive Independent Director)
7 Ms. Saloni GirrajKishor AgrawalA Nil
(Executive Director)
8 Ms. Divya Shashikant Mer 0.20
(Company Secretary)
Note-*Appointed w.e.f 23/03/2015, AResigned w.e.f. 13/02/2015,
*Resigned w.e.f 23/03/2015
* All appointments are / were non-contractual.
* Remuneration as shown above comprises of Salary, Leave Salary, Bonus,
Leave Travel Assistance, Medical Benefit, House Rent Allowance,
Perquisites and Remuneration on Cash basis
* The median remuneration of employees of the Company during the
financial year was Rs. 1.12 Lakh
* There were 8 employees on the rolls of Company as on March 31, 2015.
BOARD COMMITTEES:
During the year under consideration your Company has constituted three
committees of the Board namely, Audit Committee, Stakeholder
Relationship Committee and Nomination & Remuneration Committee.
Details of all the Committees along with their composition, terms of
reference and meetings held during the year are provided in 'Report on
Corporate Governance' forming part of the Annual Report.
VIGIL MECHANISM/WHISTLE BLOWER POLICY:
The Company has established a vigil mechanism to provide appropriate
avenues to the Directors and employees to bring to the attention of the
Management, the concerns about behavior of employees that raise
concerns including fraud by using the mechanism provided in the Whistle
Blower Policy. The details of the said Policy are included in the
Report on Corporate Governance which forms part of the Annual Report.
During the financial year 2014-15, no cases under this mechanism were
reported in the Company and any of its subsidiaries/ associates.
PARTICULARS OF LOANS. GUARANTEES OR INVESTMENTS:
Details of the Investments covered under the provisions of Section 186
of the Companies Act, 2013 (Act) will be produced for verification to
the members at the registered office of the Company on their request.
POLICY FOR PREVENTION. PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT
OF WOMEN AT WORKPLACE:
The Company has framed policy in accordance with The Sexual Harassment
of Women at Workplace (Prevention, Prohibition and Redressal) Act,
2013.
During the financial year 2014-15, no cases in the nature of sexual
harassment were reported at any workplace of the company.
CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION:
The particulars under the companies (Disclosure of Particulars in the
Report of Board of Directors) Rules 1988, on conservation of energy and
Technology absorption is not applicable.
FOREIGN EXCHANGE:
There is no inflow and outflow of Foreign Exchange.
LISTING OF SHARES:
The Shares of the Company are listed on Bombay Stock Exchange (BSE)
only and the Company has paid necessary Listing fees for the year
2015-2016.
CHIEF EXECUTIVE OFFICER (CEO) AND CHIEF FINANCIAL OFFICER (CFO)
CERTIFICATION:
The Chief Executive Officer and Chief Financial Officer Certification
as required under Clause 49 of the Listing Agreements and Chief
Executive Officer declaration about the Code of Conduct is Annexed to
this Report.
GREEN INITIATIVE IN CORPORATE GOVERNANCE:
The Ministry of Corporate Affairs (vide circular nos.17/2011 and
18/2011 dated April 21 and April 29, 2011 respectively), has undertaken
'Green initiative in corporate Governance' and allowed companies to
share documents with its shareholders through an electronic mode.
Members are requested to support their green initiative by
registering/updating their email addresses, in respect of shares held
in dematerialized form with their respective depository participants
and in respect of shares held in physical form with Companies RTA.
ACKNOWLEDGEMENT:
The Board of Directors wishes to express sincere thanks to Bankers,
Shareholders, clients, Financial Institutions, customers, suppliers and
employees of Companies for extending support during the year.
For and On behalf of the Board
Sd/- Sd/-
Tanu Agarwal Jatinkumar Agarrwal
(Whole Time Director) (Director)
Date: 11/08/2015
Place: Mumbai
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