kovalam investment trading co ltd Directors report

INDIAN ACCOUNTING STANDARDS:

The financial statements have been prepared in accordance with the Indian Accounting Standards (Ind-AS) as notified by Ministry of Corporate Affairs (MCA) under Section 133 of the Companies Act, 2013 read with the Companies (Indian Accounting Standards) Rules, 2015 as amended and other relevant provisions of the Act and applicable guidelines issued by the Reserve Bank of India (RBI). The financial statements have been prepared in accordance with the format prescribed for a Non-Banking Financial Company (NBFC) in compliance of the Companies (Indian Accounting Standards) Rules, 2015, in Division III of Notification No. GSR 1022 (E) dated October 11, 2018, issued by the Ministry of Corporate Affairs.

OPERATIONS AND STATE OF COMPANY AFFAIRS:

During the year under review the companys funds remained invested in Shares, Loans and Advances. The dividend income earned for the financial year ended 31^st March, 2023 of Rs. 27,19,510/- (previous year 30,57,377/-). The interest income earned for the financial year ended 31^st March, 2023 of Rs. 32,90,541/-(previous years Rs. 25,41,922/-). During the year, the company also earned brokerage income for the financial year ended 31^st March, 2023 of Rs. 1,55,36,676/- (net of service tax) on mobilization of funds of third parties (previous year Rs. 47,87,615/-). The Company has also earned net gain on fair value changes of Rs. Nil during the financial year ended 31^st March, 2023.

DIVIDEND:

During the year under review, your Directors do not recommend any dividend for the financial year ended March 31, 2023 to conserve the resources.

TRANSFER TO RESERVE:

During the year under review, the Company has not transferred any amount to the General Reserve. The General Reserve of the Company stood at Rs. 11,81,40,960/- as at 31.03.2023 and a sum of Rs. 20,44,600/- has been appropriated towards Statutory Reserve Account in compliance to Section 45 IC of the Reserve Bank of India Act and the balance amount of Rs. 10,30,20,298/- is carried over to the Balance Sheet.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND:

Since there was no unpaid/unclaimed dividend, the provisions of Section 125 of the Companies Act, 2013 do not apply.

PUBLIC DEPOSIT:

The Company is registered as Non-deposit taking Non- Banking Financial Company with RBI. During the year, the Company has not accepted any deposits from the public within the meaning of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014. There is no outstanding/unclaimed deposit from the public.

SHARE CAPITAL:

The paid up Equity Share Capital as at 31^st March, 2023 remained unchanged and stood at Rs. 2,22,39,140/- divided into 2223914 Equity Shares of the face value of Rs. 10/- each. During the year, the Company has not issued shares with differential voting rights nor has granted any stock options or sweat equity, none of the Directors of the Company hold instruments convertible into Equity Shares of the Company.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENT BY THE COMPANY:

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act 2013 are given in the notes to Financial Statements forming a part of this Annual Report. The Company being a Non-Banking Financial Company registered under Reserve Bank of India Act, 1934, thus the provisions of Section 186 (except Sub Section 1) of the Companies Act, 2013 in respect of lending and investment activities, are not applicable to the Company.

CHANGE IN THE NATURE OF BUSINESS:

During the year under review, there was no change in the nature of the business of the Company.

DIRECTORS:

As on March 31, 2023, the Board of Directors consists of 4 (Four) Directors comprising of 2 (two) Non-Executive Directors and 2 (two) Non-Executive Independent Directors.

During the year under review, there was no change in the Composition of the Board of Directors of the Company.

Members of the Company had approved the appointment of Dr. Suresh Kumar Singla (DIN: 00403423) as an Independent Director of the Company w.e.f. 30.03.2022 and also approved the continuation of holding of office as Non-Executive Independent Director By Dr. Suresh Kumar Singla (DIN: 00403423), upon attaining the age of 75 years in the 40th Annual General Meeting by way of Special Resolutions.

RETIREMENT BY ROTATION:

In accordance with the provisions of Section 152(6) of the Companies Act, 2013, Smt. Manisha Oswal (DIN: 06948181), Director of the Company, shall retire by rotation at the forthcoming Annual General Meeting of the Company and being eligible, offers herself for re-appointment, on the same terms and conditions on which he was appointed/ re-appointed.

In compliance with Regulation 36(3) of Listing Regulations and Secretarial Standards information about the Director proposed to be appointed/re-appointed is attached along with the Notice calling the ensuing Annual General Meeting.

WOMAN DIRECTOR:

In terms of the provisions of Section 149 of the Companies Act, 2013 and SEBI (LODR), Regulations, 2015, your Company has Smt. Manisha Oswal as Woman Director on the Board.

KEY MANAGERIAL PERSONNEL:

The following persons are the Key Managerial Personnel (KMPs) of the Company as on March 31, 2023 in terms of provisions of Section 203 of the Companies Act, 2013 and rules made there under:-

DECLARATION OF INDEPENDENT DIRECTORS:

In terms of Section 149(7) of the Companies Act, 2013, the Company has received necessary declaration from all the Independent Directors of the Company. All Independent Directors of the Company have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Act, Regulation 16(1)(b) of the Listing Regulations along with the declaration that they have registered themselves with the Independent Directors Database maintained by the IICA as provided in sub-rule (3) rule 6 of the Companies (Appointment and Qualifications of Directors) Rules, 2014. In the opinion of the Board, the Independent Directors, fulfill the conditions of independence specified in Section 149(6) of the Act Regulation 16(1) (b) of the Listing Regulations. The Independent Directors have also confirmed that they have complied with the Companys Code of Business Conduct & Ethics.

MEETINGS OF THE BOARD AND COMMITTEES:

During the year under review, four meetings of the board were convened and held on May 11, 2022, August 10, 2022, November 10, 2022 and February 08, 2023. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The details in respect to the Attendance are provided in the Corporate Governance Report forming part of this Report. Information on the Audit Committee, the Nomination and Remuneration Committee, the Stakeholders Relationship Committee and Risk Management Committee and meetings of those Committees held during the year is given in the Corporate Governance Report.

SEPARATE MEETING OF INDEPENDENT DIRECTORS:

The Companys Independent Directors held their meeting on November 10, 2022 without the attendance of Non Independent Directors and members of the management. All Independents Directors were present at the meeting and, they:

BOARD EVALUATION:

Pursuant to the Section 134(3) of the Companies Act, 2013 and Regulation 17 of SEBI (LODR) regulations, 2015, the Company has devised a policy for performance evaluation of Independent Directors and the Board. The Board has carried out an annual evaluation of its own performance, performance of its Committees as well as directors individually. The Board of Directors formally assess their own performance based on parameters which, inter alia, include performance of the Board on deciding long term strategies, rating the composition and mix of Board members, discharging of governance and fiduciary duties, handling critical and dissenting suggestions, etc. The Board was satisfied with the evaluation process and approved the evaluation results thereof.

CORPORATE GOVERNANCE:

The Company is committed to follow the best Corporate Governance practices, including the requirements under the SEBI Listing Regulations and the Board is responsible to ensure the same, from time to time. The Company has duly complied with the Corporate Governance requirements. Further a separate section on Corporate Governance in compliance with the provisions of Regulation 34 of the Listing Regulations read with Schedule V of the said regulations along with a Certificate from a Practicing Company Secretary confirming that the Company is and has been compliant with the conditions stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of the Annual Report.

DIRECTORS RESPONSIBILITY STATEMENT:

Your Directors make the following statement in terms of Section 134(3)(c) of the Companies Act, 2013:- a) that in the preparation of the Annual Accounts for the year ended on 31^st March, 2023, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any; 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 as at 31^st March, 2023 and of the profit of the Company for the year ended on that date; c) that the directors have 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. d) that annual accounts have been prepared on a going concern basis. e) 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; and f) 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.

ANNUAL RETURN:

The Annual Return of the Company, pursuant to sub-section 3 (a) of Section 134 and the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 for the financial year 2022-2023 in the Form MGT-7 has been uploaded on Companys website and the web link for the same is http://www.owmnahar.com/kovalam/pdf/annual-return-2022-23.pdf

PARTICULARS OF CONTRACTS AND ARRANGEMENT MADE WITH RELATED PARTIES:

All transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arms length basis.

Further, the members of the Company in their 40th Annual General Meeting held on June 27, 2022, had approved the material-related party transaction by Kovalam Investment and Trading Company Limited with its related parties effective April 1, 2022, till the date of ensuing annual general meeting. Accordingly, the disclosure of related party transactions as required under Section 134(3)(h) of the Act in Form AOC-is annexed as Annexure-1.

The details of all the Related Party Transactions form part of Note No. 25 to the standalone financial statements attached to this Annual Report.

Your Company has framed a Policy on Related Party Transactions for purpose of identification and monitoring of such transactions in line with the requirements of the Companies Act, 2013 and Listing Regulations and the said policy is available http://www.owmnahar.com/kovalam/pdf/RPT-Policy.pdf.

We would like to inform you that during the year, no material related party transactions made by the Company with Promoters, directors, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the Company at large. Pursuant to Listing Regulations, the resolution for seeking approval of the shareholders on material related party transactions is being placed at the AGM.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

The Company is having adequate internal control systems and procedures which commensurate with the size of the Company. The Company is having Internal Audit Department which ensures that the internal control systems are properly followed by all concerned departments of the Company.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

There are no significant and material orders passed by the Regulators / Courts that would impact the going concern status of the Company and its future operations.

CORPORTE SOCIAL RESPONSIBILITY:

The Company is not covered under the purview of the requirements of Section 135 of the Companies Act, 2013 and the rules made thereon. Hence, it is not applicable to the Company.

SECRETARIAL AUDITOR AND THEIR REPORT:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules made there under and Regulations 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors of the Company has been appointed M/s P.S Dua & Associates, Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year 2022-2023. M/s P.S Dua & Associates, Practicing Company Secretaries have carried out the Secretarial Audit for the financial year ended March 31, 2023. The Secretarial Audit Report in Form No. MR-3 for the financial year ended 31st March, 2023 under the Act, read with Rules made thereunder, is annexed herewith as Annexure 2 and forms an integral part of this report.

There has been no qualification, reservation, adverse remark or disclaimer given by the Secretarial Auditor in his Report for the year under review and therefore, does not call for any further comments.

PARTICULARS OF EMPLOYEES:

The information required pursuant to the provisions of Section 197 (12) read with rule 5 (1), 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed hereto as Annexure- 3 and forms part of this report.

AUDIT COMMITTEE:

The Company has constituted an Audit Committee pursuant to Section 177(8) read with Rule 6 of the Companies (Meetings of the Board and its Powers) Rules, 2014 and SEBI (LODR), Regulations, 2015.

Presently, the Audit Committee consists of Sh. Komal Jain, Dr. Suresh Kumar Singla who are Non- Executive Independent Directors and Sh. Navdeep Sharma who is non-Executive Non-Independent Director. The details in respect to the Attendance, Powers, Roles, and Terms of Reference etc. are provided in the Corporate Governance Report forming part of this Report.

NOMINATION AND REMUNERATION COMMITTEE AND POLICY:

As required u/s 178 of the Companies Act 2013 and SEBI (LODR), Regulations, 2015, the Company has constituted nomination & remuneration committee. Presently, the committee consists of Sh. Komal Jain, Dr. Suresh Kumar Singla who are Non- Executive Independent Directors and Sh. Navdeep Sharma who is non-Executive Non-Independent Director. Further, on the recommendation of Nomination and Remuneration Committee, the board has already framed a policy for selection and appointment of Directors, Key Management Personnels & Senior Management and their remuneration. The details in respect to the Attendance, Powers, Roles, and Terms of Reference etc. are provided in the Corporate Governance Report forming part of this Report. The Nomination and Remuneration Policy is available on the Companys website and the web link for the same is http://www.owmnahar.com/kovalam/pdf/Nomination-and-Remuneration-Policy.pdf.

As mandated by proviso to Section 178(4) of the Companies Act, 2013, salient features of Nomination and Remuneration Policy is annexed as Annexure-4 hereto and forms part of this report.

STAKEHOLDER RELATIONSHIP COMMITTEE:

As required u/s 178 of the Companies Act 2013 and SEBI (LODR), Regulations, 2015, the Company has constituted stakeholder relationship committee. Presently, the committee consists of Sh. Komal Jain, Dr. Suresh Kumar Singla who are Non- Executive Independent Directors and Sh. Navdeep Sharma who is non-Executive Non-Independent Director. The details in respect to the Attendance, Powers, Roles, and Terms of Reference etc. are provided in the Corporate Governance Report forming part of this Report.

MAINTENANCE OF COST RECORDS:

The maintenance of Cost Records as specified by the Central Government under sub section (1) of Section 148 of the Companies Act, 2013 is not applicable to the Company as the Company is a Non-Banking Financial Company.

REPORTING OF FRAUD:

There are no frauds on or by your Company, which are required to be reported by the Statutory Auditors of your Company.

DISCLOSURE AS PER SEXUAL HARASSMENTOF WOMEN AT WORKPLACE (PREVENTION, PROHIBIITON AND REDRESSAL) ACT, 2013: The Company has zero tolerance for sexual harassment at workplace and has adopted a policy against sexual harassment in line with the provisions of Sexual Harassment of Women at Workplace (Prevention,

Prohibition and Redressal) Act, 2013 and the rules framed thereunder. A Sexual Harassment Committee/Internal Complaints Committee (ICC) was setup/constituted which is responsible for redressal of complaints related to sexual harassment at the workplace. During the Financial Year 2022-2023 the Company has not received any complaints on the same and hence, no complaint was pending as at 31st March, 2023.

MANAGEMENT DISCUSSION AND ANALYSIS:

Management Discussion and analysis Report as required under Regulation 34 and Schedule V of SEBI (Listing obligations and Disclosure Requirements) Regulations, 2015 forms an integral part of this Report.

LISTING AGREEMENT:

To streamline the provisions of the Listing Agreement and its better enforceability the Securities and Exchange Board of India (SEBI), on September, 2, 2015 issued SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015. The said Regulation became effective from 1^st. December, 2015. In compliance of the said Regulations, the company has entered into Listing Agreement with the BSE Ltd. on 23^rd February, 2016.

DEMATERIALSIATION OF SECURITIES:

Your Company has already established connectivity with both the Depositories i.e. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) to facilitate the holding and trading of securities in electronic form. The shareholders who have not gone in for dematerialization of shares till date, are requested to opt for dematerialization of the shares at the earliest. Further, as per SEBI circular No. D&CC/FITTC/CIR-15/2002 dated 27th December, 2002, Company has appointed M/s. Alankit Assignments Ltd. as Registrar for Share Transfer and Electronic Connectivity. Accordingly, all the shareholders, Investors, Members of the Stock Exchanges, Depository Participants and all other concerned are requested to send all communication in respect of Share Transfer, Demat/Remat, Change of Address etc. to our Registrar of below mentioned address:

M/s. Alankit Assignments Limited (Unit: Kovalam Investment & Trading Co. Ltd.) Alankit House, 4E/2, Jhandewalan Extension New Delhi-110 055 Telephone No. : (011) 42541234 Fax No. : (011) 42541201 E-mail address : rta@alankit.com Website : www.alankit.com

In case any query/complaint remains unresolved with our Registrar please write to Company at the Registered Office of the Company.

SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES AND HOLDING COMPANIES:

Your Company does not have any Subsidiary, Joint Venture or Associate Company and Holding Company as on 31^st March, 2023.

STATUTORY AUDITORS & AUDITORS REPORT:

We wish to inform you that M/s. YAPL & CO, Chartered Accountants (Firm registration number: 017800N were re-appointed as Statutory Auditors of the Company in the 40^th Annual General Meeting (AGM) to hold office up to the conclusion of the 45^th AGM. They are holding a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.

The Statutory Auditors have confirmed that they satisfy the criteria of independence, as required under the provisions of the Companies Act, 2013. The Statutory Auditors have submitted Audit Report on the Financial Statements of the Company for the Accounting year ended 31 March, 2023. The Auditors Report on the Accounts of the Company for the year under review is self-explanatory and requires no comments. During the year under review, there were no frauds reported by Auditors under Section 143(12) of Companies Act, 2013.

INTERNAL AUDITORS:

Pursuant to the provisions of Section 138 of the Companies Act, 2013, the Board of Directors of the Company has been appointed M/s. Piyush Singla & Associates, Chartered Accountants to conduct the internal audit of the Company for the financial year 2022-2023.

M/s. Piyush Singla & Associates, Chartered Accountants performs the duties of internal auditors of the Company for the financial year 2022-2023 and their report is reviewed by the audit committee.

COMPLIANCE WITH SECRETARIAL STANDARDS:

During the year under review, your Company has duly complied with applicable provisions of the Secretarial Standards on meetings of the Board of Directors (SS-1) and General Meetings (SS-2).

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:

The information regarding conservation of energy, technology absorption and foreign exchange earnings and outgo under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of The Companies (Accounts) Rules, 2014, are not applicable as the Company is a Non- Banking Financial Company and hence no disclosure is required.

MATERIAL CHANGES OR COMMITMENTS AFFECTING FINANCIAL POSITION OF THE COMPANY:

There were no material changes or commitments, affecting the financial position of the company which have occurred between the end of Financial Year 31^st March, 2023 and the date of this report.

BUSINESS RISK MANAGEMENT:

The Company being essentially an Investment Company, its main sources of income is interest income on loans and advances and dividend/income receivable on investments in Equity Shares/Debentures/Bonds/deposits made and held by it in other companies. The financial business is always prone to risks of capital market fluctuations and economic cycle. Pursuant to Section 134(3)(n) of the Companies Act, 2013, the Company has developed and implemented a risk management policy which identifies major risks which may threaten the existence of the Company. The same has also been adopted by your Board and is also subject to its review from time to time. The Policy is also posted on Companys website i.e. http://www.owmnahar.com/kovalam/pdf/Risk-Management-Policy-2.pdf.

The Risk Management Committee of the Company was constituted on 10.08.2022, pursuant to the Reserve Bank of India vide Circular No. RBI/2021-22/112 DOR.CRE.REC.No.60/03.10.001/2021-22 dated October 22, 2021. The main term of reference of the Committee is to review and monitor the risk associated with Companys business and suggest measures for mitigation/management of the same.

VIGIL MECHANISM/WHISTLE BLOWER POLICY:

The Company in accordance with Section 177 (9) of the Companies Act, 2013 and Regulation 22 of the SEBI (Listing Obligations and Disclosure Regulations) Requirements, 2015 has established a Vigil Mechanism/Whistle Blower Policy to report genuine concerns about unethical behaviour, actual or suspected fraud or violation of Companys code of conduct or grievances & to provide adequate safeguards against victimization of persons who may use such mechanism. The mechanism provides for direct access to the Chairman of the Audit Committee in exceptional circumstances. The Audit Committee reviews and ensures the adequacy of the system laid down by the Company for the said purpose and no concern was reported during the Financial year ended 31.03.2023. The Vigil Mechanism/Whistle Blower Policy is posted on the website of the Company and the web link for the same is http://www.owmnahar.com/kovalam/pdf/Whistle-Blower-Policy.pdf

POLICY FOR PRESERVATION OF DOCUMENTS:

In accordance with Regulation 9 of SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 the board has adopted a policy for preservation of documents and the same is also available on the Companys website and the web link for the same is http://www.owmnahar.com/kovalam/pdf/Policy-on-preservation-of-documents.pdf

POLICY FOR DETERMINATION OF MATERIALITY OF THE DISCLOSURE OF EVENTS & INFORMATION:

In accordance with Regulation 30 (4) of SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 a policy has been adopted regarding disclosures of any events or information which, in the opinion of the board of directors is material and the same is also available on the Companys website and the web link for the same is http://www.owmnahar.com/kovalam/pdf/Policy-for-determination-of-materiality-of-events-or-informations.pdf

ARCHIVAL POLICY:

In accordance with Regulation 30 (8) of SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 an archival policy has been adopted by the Board. The Archival Policy is available on the Companys website and the web link for the same is http://www.owmnahar.com/kovalam/pdf/Policy-on-Archival-of-Documents.pdf

FAMILIARISATION PROGRAMMES:

The Company, at the time of appointing a Director, issues a formal letter of appointment which, inter alia, explains the role, functions, duties and responsibilities expected from him/her as a Director of the Company. All the Independent Directors are provided with all the Policies/Guidelines as framed by the Company under various statutes and SEBI Regulations, to familiarize them with Companys procedures and practices. Further, to update them on a regular basis, the Company provides copies of all the amendments in Corporate Laws, Corporate Governance Rules and SEBI Regulations. The details of Companys Policy on Familiarization Programs for Independent Directors are posted on the website of the Company and can be accessed at http://www.owmnahar.com/kovalam/pdf/Familiarization-Programme.pdf.

CODE OF CONDUCT:

Your Company has in place, a Code of Conduct for the Board of Directors and Senior Management Personnel, which reflects the legal and ethical values to which your Company is strongly committed. The Directors and Senior Management Personnel of your Company have complied with the code as mentioned hereinabove. The Directors and Senior Management Personnel have affirmed compliance with the Code of Conduct applicable to them, for the financial year ended 31 March, 2022. The said Code is available on the website of your Company at www.owmnahar.com.

GREEN INITIATIVE:

The Ministry of Corporate Affairs (MCA) has taken a “Green Initiative in the Corporate Governance” by allowing paperless compliances by the companies. Further, as per the provisions of Companies Act, 2013, the Company may send financial statements and other documents by electronic mode to its members. Your

Company has decided to join the MCA in its environmental friendly initiative. Accordingly, henceforth Company propose to send documents such as Notice of the General Meetings, Annual Report and other communication to its shareholders via electronic mode to the registered e-mail addresses of shareholders. To support this green initiative of the Government in full measure, shareholders are requested to register/update their latest e-mail addresses with their Depository Participant (D.P.) with whom they are having Demat A/c. We solicit your valuable co-operation and support in our endeavor to contribute our bit to the environment.

LISTING OF EQUITY SHARES AND LISTING FEES:

Your Companys Equity Shares are listed on the BSE Limited (BSE), Mumbai and the listing fees for the financial year 2023-2024 has been duly paid.

HUMAN RESOURCES/INDUSTRIAL RELATIONS:

The Industrial Relations remained cordial throughout the year. A detailed section on Human Resources/Industrial Relations is provided in the Management Discussion and Analysis Report, which forms part of this Annual Report.

OTHER DISCLOSURES:

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:-

No application has been made under the Insolvency and Bankruptcy Code; hence the requirement to disclose the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year is not applicable; and

The requirement to disclose the details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons there of, is not applicable.

The Company has not defaulted in payment of interest and/ or repayment of loans to any of the financial institutions and/ or banks during the year under review is not applicable.

ACKNOWLEDGEMENT:

The Directors of the company wish to place on record their sincere thanks to the shareholders for their continued support, co-operation and confidence in the management of the Company.

By Order of the Board of Directors For Kovalam Investment and Trading Company Limited

During the Financial Year 2022-23, the Company had not entered into any contract/ arrangement/ transaction with its related parties which is not at arms length basis. (a) Name(s) of the related party and nature of relationship: Not Applicable (b) Nature of contracts/arrangements/transactions: Not Applicable (c) Duration of the contracts/arrangements/transactions: Not Applicable (d) Salient terms of the contracts or arrangements or transactions including the value, if any: Not Applicable (e) Justification for entering into such contracts or arrangements or transactions: Not Applicable (f) Date of approval by the Board: Not Applicable (g) Amount paid as advances, if any: Not Applicable (h) Date on which the special resolution was passed in general meeting as required under first proviso to Section 188: Not Applicable

By Order of the Board of Directors For Kovalam Investment and Trading Company Limited

Place: Ludhiana Navdeep Sharma Komal Jain Date: 12.08.2023 Director Director DIN: 00454285 DIN: 00399948

To The Members

KOVALAM INVESTMENT AND TRADING COMPANY LIMITED (CIN: L65910PB1981PLC023058) Premises Oswal Woollen Mills Limited G T Road Sherpur, Ludhiana-141003, Punjab

We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by KOVALAM INVESTMENT AND TRADING COMPANY LIMITED

(hereinafter called ‘the Company). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing our opinion thereon.

Based on our verification of the Companys books, papers, minute books, forms and returns filed and other records maintained by the Company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit, we hereby report that in our opinion, the Company has, during the audit period covering the financial year ended on 31^st March, 2023 (Audit Period) complied with the statutory provisions listed hereunder and also that the Company has proper Board-processes and compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

We have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for the financial year ended on 31^st March, 2023 according to the provisions of:

(i) The Companies Act, 2013 (the Act) and the rules made there under;

(ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA) and the rules made thereunder;

(iii) The Depositories Act, 1996 and the Regulations and Bye-laws framed there under;

(iv) Foreign Exchange Management Act, 1999 and the rules and regulations made there under to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings;

There was no instance of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings during the audit period as informed to us.

(v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act):-

a. The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;

b. The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015;

c. The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018- Not Applicable as the Company has not issued any securities during the audit period;

d. The Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021- Not Applicable to the Company during the Review Period.

e. The Securities and Exchange Board of India (Issue and Listing of Non-Convertible Securities) Regulations, 2021 - Not Applicable to the Company during the Review Period.

f. The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies Act and dealing with client - Not Applicable as the Company is not registered as Registrars to an Issue and Share Transfer Agents;

g. The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2021 - Not applicable to the Company during the period under review.

h. The Securities and Exchange Board of India (Buyback of Securities) Regulations, 2018 - Not Applicable as the Company has not bought back any of its securities during the audit period.

(vi) Reserve Bank of India Act, 1934 and Guidelines made there under. We have also examined compliance with the applicable clauses of the following: i. Secretarial Standards issued by The Institute of Company Secretaries of India.

ii. The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

During the period under review, as per the explanations and clarifications given to us and the representations made by the Management, the Company has generally complied with the provisions of the Act, Rules, Regulations, Guidelines, Standards, etc. mentioned above.

We further report that

The Board of Directors of the Company is duly constituted with proper balance of Non-Executive Directors and Independent Directors. There were no changes in the composition of the Board of Directors that took place during the period under review.

Adequate notice of at least seven days was given to all Directors to schedule the Board Meetings except meetings which were conducted at shorter notice, agenda and detailed notes on agenda were available at the meeting and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting.

All the decisions of the Board of Directors were approved unanimously or by majority and same were captured and recorded as part of the minutes.

We further report that there are adequate systems and processes in the Company commensurate with the size and operations of the Company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.

Place: - Ludhiana Signature: -

Date: - 12/08/2023 Name of Company Secretary in Practice: - P. S. Dua FCS No. 4552 C P No. 3934 UDIN: F004552E000795617 Peer Review Certificate No. 1296/2021

This report is to be read with our letter of even date which is annexed as “Annexure A” and forms an integral part of this report.

To The Members KOVALAM INVESTMENT AND TRADING COMPANY LIMITED Premises Oswal Woollen Mills Limited G T Road Sherpur, Ludhiana-141003, Punjab (CIN: L65910PB1981PLC023058)

Our Report of even date is to be read along with this letter.

For P. S. Dua & Associates

Disclosure in the Boards Report under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

$ Details not given as the sitting fees has remained constant at Rs. 1,000/- per Board Meeting. @ Details not given as the remuneration has remained constant at Rs. 8,000/- per month.

Details of Top ten employees of the Company in terms of salary drawn as required under Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 for the financial year 2022-2023.

Note: i. During the Financial Year 2022-2023, there was no employee who, if employed throughout the financial year, was in receipt of remuneration in the aggregate, not less than one crore and two lakh rupees. ii. During the Financial Year 2022-2023, there was no employee who, if employed for a part of the financial year, was in receipt of remuneration for any part of the year, at a rate which, in the aggregate, was not less than Eight Lakhs and Fifty Thousand Rupees per month. iii. During the Financial Year 2022-2023, there was no employee who, if employed throughout the financial year or part thereof, was in receipt of remuneration in the year which, in the aggregate, or as the case may be, at a rate which, in the aggregate, was in excess of that drawn by the managing director or whole-time director or manager and holds by himself or along with his spouse and dependent children, not less than two percent of the equity shares of the Company.

APPLICABILITY

This Policy is applicable to: a. Directors (Executive, Non-Executive and Independent) b. Key Managerial Personnel (KMP) c. Senior Management Personnel d. Other employees as may be decided by the Committee (“NRC”)

OBJECTIVE

The Policy provides criteria for:

1. Determining qualifications, positive attributes and independence of a Director;

2. Performance evaluation of Independent Directors, non- independent Directors, Chairman and the Board;

3.Remuneration of Directors, Key Managerial Personnel, Senior Management Personnel and other employees, as may be decided by the Committee;

PROVISIONS RELATING TO REMUNERATION OF MANAGING DIRECTOR, KEY MANAGERIAL PERSONNEL, SENIOR MANAGEMENT PERSONNELAND OTHER EMPLOYEES

The following are the guiding factors:

The scope of du es, the role and nature of responsibilities;

The level of skill, knowledge, experience, local factors and expecta ons of individual; The Companys performance, long term strategy and availability of resources;

The level and composi on of remunera on is reasonable and su cient to attract, retain and motivate Directors, KMPs, Senior Management Personnel and other employees of the quality required to run the Company successfully; and Rela onship of remunera on to performance is clear and meets appropriate performance benchmark;

PROVISIONS RELATING TO REMUNERATION OF NON-EXECUTIVE / INDEPENDENT DIRECTOR(S)

The following are the guiding factors:

The amount of si ng fees shall be subject to ceiling/ limits as provided under Companies Act, 2013 and rules made thereunder or any other enactment for the time being in force and as decided by the Board from time to time. - The Non-Executive/ Independent Director(s) may also receive remuneration / compensation / commission etc as per criteria/limit thereof prescribed under Companies Act, 2013 and rules made thereunder - Any increase in the maximum aggregate remuneration payable beyond permissible limit under the Companies Act, 2013 shall be subject to the approval of the Shareholders, as may be applicable

EVALUATION

The evaluation will be done on following parameters:

1. Role which he/she is expected to play, internal Board Relationships to make decisions objectively and collectively in the best interest of the Company to achieve organizational successes and harmonizing the Board; 2. Attendance and contribution at Board and Committee meetings; 3. Subject expertise, skills, behavior, experience, leadership qualities, understanding of business and strategic direction to align companys values and standards; 4. Ability to monitor the performance of management and satisfy himself with integrity of the financial controls and systems in place by ensuring right level of contact with external stakeholders 5. Vision on Corporate Governance and Corporate Social Responsibility 6. Ability to create a performance culture that drives value creation and a high quality of discussions; 7. Effective decision making ability to respond positively and constructively to implement the same to encourage more transparency;

By Order of the Board of Directors For Kovalam Investment and Trading Company Limited

Place: Ludhiana Navdeep Sharma Komal Jain Date: 12.08.2023 Director Director DIN: 00454285 DIN: 00399948