Your Directors have pleasure in submitting the Forty-first Annual Report of the Company together with the audited Annual Accounts showing the financial position of the Company for the year ended on 31st March 2024.
Management Discussion & Analysis
i) Industry structure and development: The company is a Non-Systemically Important Non-Deposit taking Non-Banking Finance Company (NBF C) registered with Reserve Bank of India Act, 1934. The company is engaged in investments and finance.
ii) Opportunities & Threats: The Company keeps a close watch on the trends in industry for making investments and giving loans in accordance with its size of operations considering the possible threats including external ongoing factors.
iii) Segment-wise or product-wise performance: The Company operates only in the segment of finance and investment and as such there is no reportable segments wise or product wise performance.
iv) Outlook - The Company being engaged in investment and finance business faces challenges and opportunities in the capital and finance market. The company has been able to achieve good performance during the financial year 2023-2024. There are challenges in future for interest rates movement and volatility in stock market. The volatility in stock indices represents both an opportunity and challenge for the Company. The company continues to see movements in the market and uses periods of weakness as investment opportunities for long term.
v) Risks and concerns: The Company has exposure in shares, securities, properties, loans & advances and any adverse development in stock market and industry will have an impact on the Company’s performance.
vi) Internal control systems and their adequacy: The Company has adequate internal control systems commensurate for its limited operations. The Company has appointed Internal Auditors to observe the Internal Controls, and to assess that the workflow of the organization is being done through the approved policies of the Company. The observations of internal auditors are considered by the Audit Committee of the Board.
vii) Financial & Operational performance
The Financial and Operational performance during the year was as under:
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Rupees in Lakhs
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Gross Income
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317.11
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Gross Operating Profit
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295.71
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Provision for Taxation
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14.12
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Profit After Tax
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281.59
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Dividend and Transfer to Reserves
Your Directors do not recommend any dividend for the year ended on 31st March 2024. An amount of Rs. Two Crore Fifty Lac has been transferred from surplus balance in Statement of Profit and Loss to general reserve during the year. An amount of Rs. Fifty Six Lakhs Fifty Thousand has been classified as special reserve as per RBI guidelines.
Directors and Key Managerial Personnel
Mr. Sandeep Rathi, an Independent Director of the company retires on 29th September 2024 after completing his ten years term of appointment. The board wishes to acknowledge the valuable contribution made by Mr. Rathi during his tenure as Independent Director.
On the recommendation of the Nomination & Remuneration Committee, the board of directors propose to appoint Mr. Girish Kumar Joshi (DIN 09659780) as an Independent Director of the company for a period of consecutive five years subject to approval of shareholders at the ensuing Annual General Meeting (AGM). Mrs. Sanju Tulsyan retires from the Board by rotation and being eligible, offers herself for re-appointment as director at the ensuing AGM.
The re-appointment of Mr. Ashok Tulsyan as a Whole Time Director for further period of two years shall also be placed for consideration of shareholders at the ensuing AGM. The appointment of Mr. Ashok Tulsyan as Whole Time Director shall continue to be without any remuneration, perks or benefits payable to him.
During the year six board meetings were convened and held.
The Independent Directors of the company have given declarations under Section 149(7) of the act that they meet the criteria of independence as provided under Section 149(6) of the Act.
Apart from sitting fees paid to the independent directors no other remuneration is paid to directors. Commensurate with the limited size of operations of the company the Board has, on recommendation of Nomination and Remuneration Committee -
i) Framed a policy for selection and appointment of Directors and Senior Management and their remuneration. As per company’s policy the independent director should possess fair professional qualification, sound ethics and attributes, and should meet the criteria of independence.
ii) Adopted a framework for performance evaluation of the Board, its Committees, individual directors and chairperson through a survey questionnaire. The survey questionnaire broadly covers various aspects of board functioning, composition of the Board and its committees, culture, execution and performance of specific duties, obligation and governance.
NBFC Activities
The Company is classified as an Investment and Credit Company (NBFC-ICC) as per RBI guidelines under the base category. The Company is not accepting/holding public deposits and as such no amount on account of principal or interest on public deposit was outstanding on the date of balance sheet. Further the company has not accessed any public borrowings or funds.
Particulars of Loans, Guarantees or Investment The Company being an NBFC registered with Reserve Bank of India, the provisions of section 186 of The Companies Act, 2013 are not applicable to it.
Audit Committee
The Company has constituted an audit committee with Mr. S Rathi, Mr. Mukesh Sarswat and Mr. A. Tulsyan as members.All recommendations of the audit committee have been accepted by the board.
Directors’ Responsibility Statement
To the best of their knowledge and belief, and according to the information and explanations obtained, your Directors make the following statements in terms of Section 134(3)(C) of the act:
a. That in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanations relating to material departures.
b. That the directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period.
c. That the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities.
d. That the directors have prepared the annual accounts on a going concern basis.
e. That the directors have laid down internal financial controls to be followed by the company and that such internal financial controls were adequate and operating effectively.
f. That the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
Related Party Transactions
Related party transactions were on arm’s length basis and were in the ordinary course of the business. Details of the transactions with Related Parties are provided in the accompanying financial statements. There was no transaction during the year which would require to be reported in Form AOC.2.
Statutory Auditors
M/s. Patel Shah & Joshi, Chartered Accountants, are the statutory auditors of the company. There are no qualifications, reservations or adverse remarks or disclaimers made by Statutory Auditors in their Report on the financial statements for the period. Their term of appointment for five years is up to the ensuing AGM. On the recommendation of audit committee the proposal for their reappointment for another term of five years shall be placed before the shareholders at the ensuing Annual General Meeting. Secretarial Auditors
Priyanka Borana, the secretarial auditors, has given a Secretarial Audit Report in form MR3 for the period. There are no qualifications, reservations or adverse remarks or disclaimers made by her in the Report.
Risk Management Policy
Commensurate with its limited size of operations the Company is keeping a close watch on the trends in industry for lending of funds and making investments. It is also considering the possible threats due to external factors.
Disclosures with respect to Demat Suspense Account/ Unclaimed Suspense Account
Number of shareholders and the outstanding shares in the suspense account lying at the beginning of the year - NIL, Number of shareholders who approached listed entity for transfer of shares from suspense account during the year - NIL, Number of shareholders to whom shares were transferred from suspense account during the year - NIL, Aggregate number of shareholders and the outstanding shares in the suspense account lying at the end of the year - NIL.
Declaration that the voting rights on shares in the suspense account shall remain frozen till the rightful owner of such shares claims the shares - Not Applicable Corporate Social Responsibility
It is your company’s belief that its primary goal is to fulfill responsibility towards all its constituents i.e., shareholders, customers, government, regulatory bodies, etc. The company maintains fair and ethical practices in its dealings as part of its social responsibility. Further provisions of section 135 of the act and submission of corporate governance report are not applicable to the company.
Vigil Mechanism/Whistle Blower Policy
Your Company has adopted and disseminated its Whistle-Blower Policy to provide a secure environment and encourage employees to report unethical, unlawful, or improper practices, acts or activities and to prohibit any adverse action against those who
report such practices in good faith. The Whistle-Blower Policy is disclosed on the website of the Company.
Annual Return
As per Section 92 of the Companies Act, 2013, the copy of annual return of the company has been placed on the website of the company and can be accessed at www.sitaenterprises.com. Subsidiaries, Associates and Joint Ventures The company does not have any subsidiary or joint venture. The company has an associate company namely - Bombay Mercantile & Leasing Company Ltd (BML). The accounts of this associate concern have not been consolidated with that of the company as there is no requirement for the same as per provisions of Accounting Standard - Ind (AS) 28 for the reasons mentioned in the prescribed form AOC- I, annexed separately. A proposal for sale or disposal of company’s holdings in BML is being placed before shareholders at the ensuing AGM.
Other Information
The disclosure under Section 197 of the Companies Act, 2013 has been annexed to this report. The company has no employee of the category specified in Section 197(12) of the Act.
The Company has not consumed any significant quantity of energy; therefore, no comments are made on conservation of energy and technology absorption. There has been no foreign exchange income/outflow during the year under review. The provision of cost audit is not applicable to the Company.
The company prepares its financial statements as per Indian Accounting Standard (IndAS). Secretarial Standards issued by The Institute of Company Secretaries of India, applicable to the company are complied with.
The shares of the company are listed at BSE Limited (Bombay Stock Exchange). The company has paid the due listing fees to the exchange.
There have been no other material changes and commitments, if any, affecting the financial position of the company, which have occurred between the end of the financial year and date of the report. During the year - there has been no change in nature of business conducted by the company, there has been no change in share capital, no share has been transferred in suspense account, no fraud has been reported to the audit committee, no order or penalty was passed against the company by any authority. The company has adopted adequate measures for prevention of insider trading.
The Company has the Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee. The Company has in place internal financial control systems, commensurate with the size and complexity of its operations, to ensure proper recording of financial and monitoring of operational effectiveness and compliance of various regulatory and statutory requirements.
The company is following the guidelines of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. There have been no cases reported during the year.
The Company is giving effect to various compliances applicable to it and adopting policies commensurate with its limited size of operations.
The board places on record its appreciation for the continued support and cooperation extended by employees, customers, bankers, and all other constituents.
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