To the Members of the Company,
The Directors have pleasure in presenting the Twenty-First Annual
Report on the business and operations of your Company with Audited
Accounts for the year ended 31st March 2015. The financial results of
the Company are summarized below:
FINANCIAL RESULTS:
(Rs. In Lacs)
PARTICULARS STANDALONE STANDALONE CONSOLI- CONSOLI-
YEAR ENDED YEAR ENDED DATED DATED
YEAR YEAR
31st MARCH 31st MARCH ENDED 31st ENDED 31st
2015 2014 MARCH 2015 MARCH 2014
Total Revenue 1408.46 1155.26 1425.74 1231.55
Profit Before Depreciation
and Taxes 594.68 (307.65) 553.69 (280.60)
Less: Depreciation 17.64 10.51 17.64 10.51
Less : Provision for
(a) Income Tax 25.66 32.86 25.66 32.86
(b) Deferred tax (3.54) (0.35) (3.54) (0.35)
Income Tax paid of earlier years 1.20 (0.41) 1.20 (0.41)
Total Tax Expenses 23.32 32.00 23.32 32.00
Profit / (loss) for the Year 553.72 (350.26) 512.73 (323.22)
Add: Brought forward
from last year 21.68 371.95 141.10 464.56
Distributable Profits 575.39 21.68 653.84 141.10
Appropriated as under:
Transfer to Special Reserve 110.74 -- 110.74 --
Depreciation Adjustment 1.31 -- 1.31 --
Proposed Equity Dividend 63.99 -- 63.99 --
Tax on Distributed Profits 12.79 -- 12.79 --
Balance Carried Forward to
Balance sheet 386.56 21.68 465.01 141.10
OPERATIONS:
During the year, the Operations of Your Company were satisfactory. Your
Company is in the policy of giving short term loans based on scrutiny
of paying capacity and risk involved.
During the year your Company has received an order from Reserve bank of
India, Ahmedabad for the cancellation of certificate of Registration to
carry on the business of Non-Banking Financial Institution under
section 45-IA(6) of the Reserve Bank of India Act, 1934 vide order
dated September 24, 2014. Your Company has filed an appeal against the
above said order with the Appellate Authority, Ministry of Finance,
Government of India, New-Delhi. The Hearing took place on March 20,
2015 and the order is awaited from the Appellate Authority.
FINANCIAL HIGHLIGHTS:
Consolidated Revenues:
The total consolidated income of the Company for the FY 2014-15
comprises operating revenues of Rs. 1414.08 Lacs and other income of
Rs. 11.66 lacs as compared to previous fiscal operating revenues of Rs.
1230.40 lacs and other income of Rs. 1.15 lacs.
Standalone Revenues:
During the fiscal 2015, the total income of the Company stood at Rs.
1408.46 Lacs as compared to previous fiscal of Rs. 1155.26 Lacs.
Consolidated Profits / (Loss):
Profit stood at Rs. 536.05 Lacs before tax and Profit after Tax stood
at Rs. 512.73 Lacs as compared to previous fiscal Loss before Tax stood
at Rs. (291.12) Lacs and Loss after Tax stood at Rs. (323.22) Lacs.
Standalone Profits / (Loss):
Profit stood at Rs. 577.04 Lacs before tax and Profit after tax stood
at Rs. 553.72 Lacs for the fiscal 2015 as compared to the previous year
Loss before tax Rs. (318.17) Lacs and after tax Rs. (350.26) Lacs.
Your Company has proposed a dividend of 2% i.e Rs. 0.02 paise per
equity share amounting to Rs. 63,98,762/- for the accounting year ended
31st March 2015.
Your company already intimated you regarding Wholly Owned Subsidiary in
the name of Finsolution Services FZE, in United Arab Emirates. During
the fiscal 2015, the gross operational income of the subsidiary stood
at AED 1.03 lacs and Operating Loss for the fiscal year 2015 stood at
AED (2.46) lacs as compared to the previous year AED 4.91 lacs and
profit AED 1.74 lacs.
The standalone net worth of your company at the year end stands at Rs.
9171.70 Lacs which translated to a book value of Rs. 2.87/-. per share
of face value of Re. 1/- each. The consolidated net worth of your
company at the yearend stands at Rs. 9268.94 lacs which translated to a
book value of Rs. 2.89/- per share of face value of Re. 1/- each. The
Board has recommended a dividend of 2% i.e Rs. 0.02 paise per equity
share amounting to Rs. 63,98,762/- (Rupees Sixty Three lacs Ninety
Eight Thousand Seven Hundred and Sixty Two only) for the accounting
year ended 31st March 2015.
RESERVES:
The Company has carried forward an amount of Rs. 1,10,74,313/- to
Special Reserve DIVIDEND:
Your directors propose a dividend of 2% of the paid up equity capital
of the Company i.e Rs. 0.02 per equity share amounting to Rs.
63,98,762/- (Rupees Sixty Three lacs Ninety Eight Thousand Seven
Hundred and Sixty Two only) for the accounting year ended 31st March
2015.
DIRECTORS:
In accordance with the provisions of the Companies Act, 2013 and the
Articles of Association, Mrs. Annu Agrawal, Director of the Company
retires by rotation at the ensuing Annual General Meeting and being
eligible, offers herself for reappointment.
All independent directors have given declaration that they meet the
criteria of independence as laid down under section 149(6) of the
Companies Act, 2013 and Clause 49 of listing agreement. All the
directors of the Company have confirmed that they are not disqualified
from being appointed as directors in terms of Section 164 of the
Companies Act, 2013.
A brief resume and other details, as stipulated under the Listing
Agreement for the above director seeking re-appointment is given as
Additional Information on Directors which forms part of the Notice.
(i) Board Evaluation
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of
the Listing Agreement, a separate exercise was carried out to evaluate
the performance of individual Directors including the Chairman of the
Board who were evaluated on parameters such as level of engagement and
contribution and independence of judgment thereby safeguarding the
interest of the Company. The performance evaluation of the Independent
Directors was carried out by the entire Board. The performance
evaluation of the Chairman and the Non Independent Directors was
carried out by the Independent Directors. The board also carried out
annual performance evaluation of the working of its Audit, Nomination
and Remuneration as well as Shareholders / Investors Relations and
Grievance Committee. The Directors expressed their satisfaction with
the evaluation process.
(ii) Remuneration Policy
The Board has, on the recommendation of the Nomination & Remuneration
committee framed a policy for selection and appointment of Directors,
Senior Management and their remuneration. The remuneration policy as
adopted by the company envisages payment of remuneration according to
qualification, experience and performance at different levels of the
organization.
(iii) Details of Board Meetings held
During the year Six Board Meetings and one independent directors'
meeting was held. The Details of the meetings and attendance thereof
have been given in Corporate Governance Report. The provisions of
Companies Act, 2013 and listing agreement were adhered to while
considering the time gap between two meetings.
(iv) Constitution of Committees
The Board has constituted an Audit Committee, Nomination & Remuneration
Committee and a Shareholders / Investors Relations and Grievance
Committee, the details of which have been mentioned in the Corporate
Governance Report which is forming a part of the Annual Report.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to the requirement of Clause (c) of subsection (3) of Section
134 of the Companies Act, 2013, your Directors confirm that:
1. That in the preparation of the annual accounts for the financial
year ended 31st March, 2015 the applicable accounting standard had been
followed along with proper explanation relating to material departures.
2. That the directors had selected such accounting policies and applied
them consistently and made judgments and estimates that were 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 the year under review.
3. That the directors had taken proper and sufficient care 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. That the directors had prepared the accounts for the financial year
ended 31st March, 2015 on a going concern basis.
5. That the directors had laid down internal financial controls to be
followed by the company and that such internal financial controls are
adequate and were operating effectively.
6. That the directors had devised proper systems to ensure compliance
with the provisions of all applicable laws and that such systems were
adequate and operating effectively
AUDITORS:
(i) Statutory Auditor
The retiring auditors, namely M/s. Bansal Bansal & Co., Practicing
Chartered Accountants, Mumbai, hold office until the conclusion of the
forthcoming Annual General Meeting and are seeking re-appointment. They
have confirmed that their appointment if made, at the Annual General
Meeting, will be within the limits prescribed under Companies Act,
2013. They have also confirmed that they hold a valid peer review
certificate as prescribed under Clause 41(1)(h) of the Listing
Agreement. Members are requested to consider their reappointment.
(ii) Secretarial Auditor
In terms of Section 204 of the Companies Act 2013 and Rules made there
under, M/s. R M Mimani & Associates LLP, Practicing Company Secretaries
have been appointed Secretarial Auditor of the Company. The report of
the Secretarial Auditors is enclosed as Annexure 3 to this report.
(iii) Internal Auditor
M/S N. Kanodia & Co., Practicing Chartered Accountant performed the
duties of internal auditors of the company for 2014-15 and their report
is reviewed by the audit committee from time to time.
COMMENTS ON AUDITOR'S REPORT:
Statutory Auditor:
As regards not making provision for retirement benefits of employees,
the same has not been done in view of the meager staff strength.
With respect to the various loans given to Liquors India Limited
amounting to 1.70 Crores without seeking permission of the Reserve Bank
of India (RBI), even after cancellation of NBFC Certificate, is due to
the contractual agreement entered prior to the cancellation of the
registration. Since the Contractual agreement was entered by your
Company with Liquors India Limited was much before the order for
cancellation of registration received by your Company and your Company
had to adhere to the terms and conditions of the agreement in the
normal course of Business and in contrnuation to the previous loans
granted to Liquors India Limited and hence the loan was granted.
As regards exposure norms of RBI for a single borrower, the limit has
exceeded for one of the Borrower. The said exposure is secured which is
more than sufficient to cover the entire amount due from the borrower
and the management is confident of realizing these dues.
Reserve Bank of India vide its order dated 24th September, 2014 has
cancelled certificate of registration issued to the Company. Your
Company has filed an appeal against the about said order with the
Appellate Authority, Ministry of Finance, Government of India,
New-Delhi against the said RBI order. The Hearing took place on March
20, 2015 and the order is awaited from the Appellate Authority.
Secretarial Auditor:
Reserve Bank of India vide its order dated 24th September, 2014 has
cancelled certificate of registration issued to the Company to carry on
the business of Non-Banking Financial Institution under section
45-IA(6) of the Reserve Bank of India Act, 1934.
Your Company has filed an appeal against the above said order with the
Appellate Authority, Ministry of Finance, Government of India,
New-Delhi. The Hearing took place on March 20, 2015 and the order is
awaited from the Appellate Authority. Further regarding the First
information report (FIR) filed by the Reserve Bank of India, Ahmedabad
against the Company and its Directors under various section of IPC, the
same is still under investigation.
With respect to an Ex-parte ad interim order dated December 19, 2014
passed by the Securities Exchange Board of India (SEBI) under section
11(1), 11(4) and 11B of the Securities Exchange Board of India Act,
1992 in the matter of First Financial Services Limited for not
accessing the capital market, your Company filed a reply with SEBI in
this regard.
On 24th February 2015, a hearing took place in SEBI. No final order has
been passed by SEBI in this regard. However, your Company has filed an
appeal with the Securities Appellate Tribunal on 23rd July, 2015 in
this regard.
With respect to the various loans given to Liquors India Limited
amounting to 1.70 Crores without seeking permission of the Reserve Bank
of India (RBI), even after cancellation of NBFC Certificate, is due to
the contractual agreement entered prior to the cancellation of the
registration. Since the Contractual agreement was entered by your
Company with Liquors India Limited was much before the order for
cancellation of registration received by your Company and your Company
had to adhere to the terms and conditions of the agreement in the
normal course of Business and in contrnuation to the previous loans
granted to Liquors India Limited and hence the loan was granted.
As regards exposure norms of RBI for a single borrower, the limit has
exceeded of one of the Borrower. Also the said exposure is secured
which is more than sufficient to cover the entire amount due from the
borrower and the management is confident of realizing these dues.
As regards delay in filing of certain returns/ forms with the Registrar
of Companies, these forms/returns have been filed by making the payment
of the additional fee as prescribed by the law.
The Company is in process of formulating the certain policies as
required under the Companies Act, 2013 and listing agreement and will
finalize the same as and when the policies are mandatorily applicable
to the Company.
VIGIL MECHANISM/ WHISTLE BLOWER POLICY:
Pursuant to the provisions of section 177(9) & (10) of the Companies
Act, 2013, a Vigil Mechanism for directors and employees to report
genuine concerns has been established. The Vigil Mechanism Policy has
been uploaded on the website of the Company at
http://www.comfortintech.com/whistle_blower_policy.php.
RELATED PARTY TRANSACTIONS:
Related party transactions that were entered during the financial year
were on an arm's length basis and were in the ordinary course of
business. There were no materially significant related party
transactions with the Company's Promoters, Directors, Management or
their relatives, which could have had a potential conflict with the
interests of the Company. Transactions with related parties entered by
the Company in the normal course of business are periodically placed
before the Audit Committee for its omnibus approval and the particulars
of contracts entered during the year as per Form AOC 2 is enclosed as
Annexure 4. The Board of Directors of the Company has, on the
recommendation of the Audit Committee, adopted a policy to regulate
transactions between the Company and its Related Parties, in compliance
with the applicable provisions of the Companies Act 2013, the Rules
there under and the Listing Agreement. This Policy was considered and
approved by the Board and has been uploaded on the website of the
Company at http://www.comfortintech.com/
related_party_transaction_policy.php.
SUBSIDIARY COMPANY:
Pursuant to sub-section (3) of section 129 of the Companies Act 2013,
the statement containing the salient feature of the financial statement
of a company's subsidiary or subsidiaries, associate company or
companies and joint venture or ventures is given as Annexure 2.
Further, during the year your company has taken initiation to close the
Wholly Owned Subsidiary in Dubai. The matter is under process.
EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the Annual Return in Form
MGT 9 is annexed herewith as Annexure
5. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
Details of Loans, Guarantees and Investments covered under the
provisions of Section 186 of the Companies Act, 2013 are given in the
notes to the Financial Statements.
REMUNERATION RATIO OF THE DIRECTORS / KEY MANAGERIAL PERSONNEL (KMP) /
EMPLOYEES:
The information required pursuant to Section 197 read with Rule 5 of
The Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 and Companies (Particulars of Employees) Rules, 1975, in
respect of employees & Key Managerial Person of the Company and
Directors is furnished hereunder:
Sr. Name of the Director/ Designation Remuneration
No KMP 2014-15
1 Mr. Anil Agrawal Managing Director 21,18,333
2 Mr. Bharat Shiroya Whole time Director 13,01,458
3 Mrs. Ramadevi Gundeti Company Secretary 10,40,276
4 Mr. Lalit Sethi** Chief Financial Officer 9,62,591
Name of the Director Remuneration Increase/ Ratio/Times per
KMP 2013-14 Decrease median of
employee
remuneration
Mr. Anil Agrawal 14,25,000 6,93,333 8.15
Mr. Bharat Shiroya 9,25,167 3,76,291 5.01
Mrs. Ramadevi Gundeti 10,80,919 -40,643 4.00
Mr. Lalit Sethi* Nil 9,62,591 3.70
** Mr. Lalit Sethi was appointed as the Chief Financial Officer of the
Company w.e.f 14th February, 2015 and ceased w.e.f. 30th May, 2015.
INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY
The Company has adequate system of internal control to safeguard and
protect from loss, unauthorized use or disposition of its assets. All
the transactions are properly authorized, recorded and reported to the
Management. The Company is following all the applicable Accounting
Standards for properly maintaining the books of accounts and reporting
financial statements. The internal auditor of the company checks and
verifies the internal control and monitors them in accordance with
policy adopted by the company. The Company continues to ensure proper
and adequate systems and procedures commensurate with its size and
nature of its business.
BUSINESS RISK MANAGEMENT:
The company has been addressing various risks impacting the company and
the policy of the company on risk management is provided elsewhere in
this annual report in Management Discussion and Analysis.
FIXED DEPOSITS:
The Company has not accepted any fixed deposits as on 31st March 2015
so as to attract the provisions of Chapter V of the Companies Act, 2013
read with Companies (Accounts) Rules, 2014 as amended from time to
time.
CONSOLIDATED FINANCIAL STATEMENTS:
In accordance with the Accounting Standards AS-21 on Consolidated
Financial Statements read with the Accounting Standard AS-23 on
Accounting for investments in Associates, the Audited Consolidated
Financial Statements are provided in the annual report.
MANAGEMENT DISCUSSION AND ANALYSIS AND CORPORATE GOVERNANCE REPORT:
The Management Discussion and Analysis for the year 2014-15 and a
detailed report on Corporate Governance, as required under Clause 49 of
the Listing agreement executed with the Stock Exchanges, are given in
separate sections forming part of the Annual Report.
A Certificate from Statutory Auditors of the company, M/s. Bansal
Bansal & Co., confirming compliance with the conditions of Corporate
Governance stipulated in Clause 49 is annexed to the report on
Corporate Governance.
PARTICULARS OF EMPOLYEES UNDER THE COMPANIES (APPOINTMENT &
REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014:
The provisions of the Companies Act, 2013 read with the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, as
amended are not applicable to the company, as there are no employees
whose remuneration is in excess of the limits prescribed.
LISTING:
The Equity Shares of the Company are at presently listed with the BSE
Limited. The company is regular in payment of listing fee. During the
year, the Securities Exchange Board of India has given an exit order to
the Jaipur Stock Exchange vide order dated March 23, 2015 where our
Company's shares are listed.
CASH FLOW STATEMENT:
In conformity with the provisions of Clause 32 of the Listing agreement
and requirements of Companies Act, 2013, the Cash flow Statement for
the year ended 31.03.2015 is annexed here to as a part of the Financial
Statements.
ENERGY, TECHNOLOGY AND FOREIGN EXCHANGE:
Information in accordance regarding conservation of energy, technology
absorption and foreign exchange earnings and outgo is given in the
Annexure 1.
POLICY ON SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION,
PROHIBITION & REDRESSAL) ACT, 2013
A policy On Sexual Harassment of Women at Workplace has been drafted
and approved by the Board in its meeting held on May 30, 2015. A
committee namely Internal Control Committee has been construed for
protection of women against Sexual Harassment at the workplace
consisting of the following:
Name of Member Designation
Mrs. Annu Agrawal Chairman
Mrs. Ramadevi Gundeti Member
Mrs. Apexa Kadam Member
The Committee will look after the complaints received from the women
employees and will also work for Safety of Women at workplace.
SEBI ORDER
Your Company has received an Ex-parte ad interim order dated December
19, 2014 passed by the Securities Exchange Board of India (SEBI) under
section 11(1), 11 (4) and 11B of the Securities Exchange Board of India
Act, 1 992 in the matter of First Financial Services Limited for not
accessing the capital market. Your Company filed a reply with SEBI in
this regard.
On 24th February 2015, a hearing took place in SEBI. No final order has
been passed by SEBI in this regard. However, your Company has filed an
appeal with the Securities Appellate Tribunal on 23rd July, 2015 in
this regard.
RBI ORDER
Your Company has received an order from Reserve bank of India,
Ahmedabad for the cancellation of certificate of Registration to carry
on the business of Non-Banking Financial Institution under section
45-IA(6) of the Reserve Bank of India Act, 1934 vide order dated
September 24, 2014.
Your Company has filed an appeal against the above said order with the
Appellate Authority, Ministry of Finance, Government of India,
New-Delhi. The Hearing took place on March 20, 2015 and the order is
awaited from the Appellate Authority.
CORPORATE SOCIAL RESPONSIBILITY
Pursuant to the provisions of Section 135 of the Companies Act 2013
read with Schedule VII to the Companies Act 2013 and other applicable
provisions, every company having net worth of rupees five hundred crore
or more or turnover of rupees one thousand core or more or a net profit
of rupees five crore or more during any financial year shall constitute
a Corporate Social Responsibility Committee. Your Company has earned a
profit of Rs 553.72 lacs (Standalone) for the year ended March 31, 2015
and accordingly provisions of Section 135 have now become applicable to
your Company.
The Board has constituted a Corporate Management Committee to carry out
the CSR Programme within specified budgets and timeframes. The
Committee consists of the following Directors, namely:
Name of Member Designation
Mr. Anil Agrawal Chairman
Mrs. Annu Agrawal Member
Mr. Bharat Shiroya Member
Mr. Jugal Thacker Member
The Corporate Social Responsibility Policy was considered and approved
by the Board of Directors in their meeting held on 8th August, 2015.
ACKNOWLEDGEMENT:
Your directors place on record their gratitude for the continued
co-operation and guidance extended by the Securities and Exchange Board
of India, Reserve bank of India, BSE Limited and take this opportunity
to place on record their warm appreciation of the valuable
contribution, unstinted efforts and the spirit of dedication by the
employees and officers at all levels in the progress of the Company
during the year under review.
Your directors also express their deep gratitude for the assistance,
Co-operation and support extended to your company by the bankers,
customers as well as the investing community and look forward to their
continued support.
Place: Mumbai FOR AND ON BEHALF OF THE BOARD
Dated: 08.08.2015 Sd/-
ANIL AGRAWAL
Chairman & Managing Director
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