svogl oil gas energy ltd Directors report

Dear Members,

Your Directors are pleased to present the Twenty fourth Annual Report and the company’s audited financial statement for the financial year ended March 31, 2015.

Consolidated Financial Highlights:		(Rs in Millions)
Particulars	2014-15	2013-14
Operating Income	2048.62	3413.47
Other Income	500.15	262.28
Total Income	2548.77	3675.75
Profit before Interest, Depreciation and Taxation	(651.60)	(1833.61)
Finance Cost	4199.05	4368.61
Depreciation & Amortization Expenses	3286.96	2283.31
(Loss)/Profit Before Taxation	(8137.61)	(8485.54)
Less: Prior Period Adjustments	3.59	-
Add: Minority Share in Loss	(0.01)	(0.01)
Profit for the Year	(8134.01)	(8485.53)
Provision for Tax:
-Income Tax Relating To Earlier years	6.56	-
-Income Tax	-	-
-Deferred Tax	(136.25)	(1582.37)
-Mat Credit - Utilized / (availed)	-	-
Net Loss/Profit after tax	(8004.32)	(6903.16)
Add : Surplus as per Last Balance Sheet	796.73	7699.89
Surplus available for appropriation	(7207.59)	796.73
Appropriation:
Transferred to General Reserve	-	-
Surplus carried forward to the next year	(7207.89)	796.73

COMPANY’S PERFORMANCE

The consolidated operating income for the financial year 2014-15 has decreased by 40% at Rs. 2048.62 millions against Rs 3413.47 millions in the previous year due to lack of contracts resulting in dehiring of equipments and liquidity constraints. There is a Net loss (after tax) of Rs (8004.32) million as compared to loss of Rs (6903.16) million in the previous year. EBITA margins are also negative at Rs (651.60) millions as compared to Rs. (1833.61) million in the last year. As a result net worth of the Company has gone negative to Rs (859.97) millions from Rs 7582.56 millions as at 31st March, 2015.

DIVIDEND

In view of losses incurred by the Company, the Board of Directors express its inability to recommend any dividend on equity shares for the year under review.

REVIEW OF OPERATIONS

DRILLING ACTIVITIES DURING YEAR 2014-2015:

Company deployed One no. 1000HP mobile Drilling Rig on dry lease basis to Rasson Energy India (P) Limited Drilling and is operating under contract with Sintex Oil & Gas Limited at Ahmedabad, Gujarat.

Two no. 2000HP Rigs are working under a contract with Oil India Limited at Duliajan, Assam for initial period of two years, extendable for another year.

One no. 2000HP, Drilling Rig is operating under contract with Oil India Limited at Kakinada, Andhra Pradesh, KG Basin to drill 3 no. of exploratory wells with a provision of another two wells depending upon the results of first three wells.

One no. 900HP mobile Drilling/Workover Rig dry leased to Quippo got dehired after completing workover contract with Cairns India and presently stacked.

Two no. 2000HP Drilling Rigs got dehired after successfully completing contract with ONGC Karaikal in the month of February 2015.

PROJECTS UNDER BIDDING:

Company is Lowest Bidder against one no. 1400 HP Rig tender with Oil India Limited, Duliajan, Assam. LOA is awaited. In addition company has entered into MOU for giving Drilling/Workover/Sesmic equipments on lease to Companies who will deploy these assets on receipt of contracts from ONGC/Oil/Other Companies.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY AFTER 31ST MARCH, 2015.

Presently, the Scenario of oil and gas industry has improved a lot. ONGC and Oil India have already floated tenders worth about more than 7000 crores - after a gap of six/seven years- Tenders of about Rs 2500cr have already closed & balance tenders are expected to close in September, 2015. In addition Drilling and Seismic tenders worth more than Rs 2500 crores are expected shortly.

CHANGE IN CAPITAL STRUCTURE

During the year, there has been no change in the capital structure of the Company. However, the Company has allotted 50,83,046 Equity Shares of Rs 10/- each at a premium of Rs 5.955 per share on 30th April, 2015 as preferential allotment to ICICI Bank Ltd., in consideration for conversion of their Funded Interest on Term Loans amounting to Rs 8.11 Crore pursuant to CDR scheme approved by CDR-EG in terms of ICDR Regulations. These shares have been listed at BSE & NSE.

Accordingly, the paid-up share capital of the Company as on the date of this Report is Rs 51,44,35,470 divided into 5,14,43,547 equity shares of Rs 10/- each.

CORPORATE DEBT RESTRUCTURING (CDR)

CDR Scheme of the Company was approved by CDR-EG on 24th January, 2014 and is under implementation. However, the Company could not show progress during the period, as Oil Majors have not come with major tenders during this period. Now ONGC/Oil have come up with major tenders and we are hopeful that all the deployable assets will be engaged.

FCCB MATTERS

On 8th July 2010 had issued Bonds worth of US$ 80,000,000 5% convertible bonds due on 17th August 2015. The Company agreed to pay interest @ 5% p.a. semi-annually on 16th January and 16th July in each year upto the due date. However, The Company could not discharge the interest due on 16th July 2013. On such occurance of Event of Default, the trustee Citicorp International Limited (Citicorp), accelerated the entire Bond amount. The Company offered the defaulted interest amount of $ 2 million Dollars in first week of August 2013. The Citicorp refused to receive the amount and claimed entire Bond amount together with interest. Citicorp on 23rd August filed Company petition No. 446/2013 in High Court of Delhi to Wind up Shiv-Vani and the same is pending. The next date is 30.11.2015 for arguments. Citicorp has also filed Proceedings in London Court for recovery of US$ 84 million. The London Court passed summary judgement on 11th February 2014 directing the Company to pay the whole amount due under the Bonds. The trustee of FCCB Holders filed Execution Petition in High Court of Delhi to execute the London Court Judgement. The Company is contesting the execution petition and the pending before Hon’ble High Court of Delhi.

SERVICE TAX MATTERS

The Company could not pay its service tax liability from the year 2010-11 to 2012-13.Service Tax Department directed our clients in february 2013 not to pay any amount to Company and remit the amounts directly to Service Tax Department. The Company had moved a writ petition before the Hon’ble Delhi High Court to allow it to pay the service tax in installments. The Hon’ble Delhi High Court directed on 28/05/2014 to pay the same to the department equivalent to 1/3rd of the amount received from its clients as turnover proceeds in Trust and Retention Account (TRA) maintained with ICICI Bank Ltd. The said arrangement is continuing. The next date of hearing is 03.11.2015.

EXTRACT OF ANNUAL REPORT

Pursuant to Section 92 (3) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, extract of Annual Return in Form MGT-9 for the financial year under review has been provided is attached as Annexure –I.

MEETINGS OF THE BOARD

The details pertaining to number ofBoardMeetingsheldduringthefinancialyear under review have been provided in the Corporate Governance Report forming part of this Annual Report.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors confirm to the best of their knowledge and belief that:

(a) in the preparation of annual accounts for the year ended 31st March, 2015,the applicable accounting standards have been followed along with proper explanation relating to material departures;

(b) the Directors’ had selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and a fair view of the state of affairs of the Company and profit and loss of the Company as at 31st March, 2015;

(c) the Directors had 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) the Directors had prepared the annual accounts on a going concern basis; and (e) the Directors had laid down internal financial controls to be followed by the Company and that such internal financial contracts are adequate and were operating efficiently.

(f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

A STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS

In terms of Section 149(7) of the Companies Act, 2013, Mr. Dwarka Das Daga, Mr. Rajnish Gupta, Mr. Ghanshyam Das Binani and Mr. Kailash Chandra Gupta, the Independent Directors of the Company have given a declaration to the Company that they meet the criteria of independence as specified under Section 149(6) of the Companies Act, 2013 and clause 49(II)(B)(1) of the listing agreement and there has been no change in the circumstances which may affect their status as Independent Directors.

COMPANY’S POLICY ON DIRECTOR’S APPOINTMENT AND REMUNERATION

In accordance with Section 178 of the Companies Act, 2013 and clause 49 of the listing agreement, the "Nomination and Remuneration Committee" of the Board of Directors has approved the ‘Nomination, Appointment and Remuneration Policy which is available on the Company’s website (www.shiv-vani.com). The details of remuneration paid to Executive and Non-Executive Directors have been provided in the Corporate Governance Report forming part of this Annual Report.

AUDITORS AND AUDITORS’ OBSERVATIONS

(a) Statutory Auditors

M/s Vijay Prakash Gupta & Associates, Chartered Accountants (Firm Registration No 005570N), Statutory Auditors of the Company to hold office from the conclusion of the Twenty Third Annual General Meeting till the conclusion of the Twenty Fifth Annual General Meeting of the Company, i.e. for a period of three years (subject to ratification of their appointment at every Annual General Meeting) will hold office until the conclusion of the ensuing Annual General Meeting of the Company. The Board of Directors recommends ratification of appointment of M/s Vijay Prakash Gupta & Associates, Chartered Accountants to hold office from the conclusion of this Annual General Meeting till the conclusion of the Twenty Fifth Annual General Meeting of the Company. M/s Vijay Prakash Gupta & Associates have expressed their willingness to get re-appointed as the Statutory Auditors of the Company and have furnished a certificate of their eligibility and consent under Section 139(1) and 141 of the Companies Act, 2013 and the rules framed there under.

Statutory Auditors’ Observations in Audit Report and Directors’ explanation thereto –

The observations of Auditors in their Report are self explanatory by nature and therefore do not require further explanation

(b) Secretarial Auditor

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and Rules made thereunder, M/s VLA & Associates, Company Secretaries, (Membership No.F7241 and C.P.No.7622) has been appointed as a Secretarial Auditor to conduct the Secretarial Audit for the financial year 2014-15. A Secretarial Audit Report in Form MR-3 given by M/s VLA & Associates, Company Secretaries has been provided in an Annexure-II which forms part of the Directors Report.

Secretarial Auditors’ Observations in Secretarial Audit Report and Directors’ explanation thereto -

(i) In respect of Point Pertaining to appoint women director as required under the Companies Act, 2013 and Clause 49 of the listing agreement.

Irrespective of above, the Company has been making its best endeavour to find appropriate persons as women director on its Board since quite sometime, however without much success and would still continue its efforts to comly with the requirement of Clause 49(II)(A)(1) of Listing Agreement.

(ii) In respect of Point Pertaining to provisions of regulations 30(1) and regulations 31(1) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011. Due to oversight intimation to stock exchanges was not made in respect of regulation 30(1) and regulation 31(1) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011

(c) Internal Auditor In terms of Section 138 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, the Company has appointed Mr. Nayak Sah Mittal & Co., Firm Registration No.- 013647N, and Partner Mr.Rama Kanta Nayak, Chartered Accountant (Membership no. 092979) as the Internal Auditor of the Company.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the year under review, the Company has not given any loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 which require approval of the shareholder.

PARTICULARS OF CONTRACTS / ARRANGEMENTS WITH RELATED PARTIES

The particulars of contracts / arrangements with related parties referred to in Section 188(1) entered into during the financial year under review as required to be given in Form AOC-2, have been provided in an Annexure-III which forms part of the Directors’ Report.

The Company has formulated a policy on Related Party Transaction and also on dealing with Related Party

Transactions. The policy is disclosed on the website of the Company (www.shiv-vani.co.in/com).

All transactions entered into with the Related Party were as per RTP policy adopted by the Company. Particulars of contracts or arrangement with related parties as required under Section 134(3)(h) of the Companies Act, 2013 are given in Annexure – III.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO

The particulars of conservation of energy, technology absorption, foreign exchange earnings and outgo for the financial year under review as required to be given under Section 134(3)(m) of the Companies

Rules made there under has been provided in an Annexure-IV which forms part of the Directors’ Report.

RISK MANAGEMENT

In terms of revised Clause 49 of the Listing Agreement, the Company has constituted a Risk Management Committee, the details of which have been provided in the Corporate Governance Report forming part of this Annual Report. The Board of Directors has approved a Risk Management Policy which is available on Company’s website (www.shiv-vani. com). The Company’s risk management and mitigation strategy has been discussed in the Management Discussion and Analysis Report forming part of this Annual Report.

VIGIL MECHANISM

The vigil mechanism of the Company in term of the Listing Agreement includes a Task Force comprising senior executives of the Company. Protected disclosures can be made by a Whistle Blower through an email or dedicated telephone lines or a letter to the Task Force.

EVALUATION OF THE BOARD’S PERFORMANCE

The information pertaining to Annual Evaluation of Board’s performance as required to be stated in terms of Section 134(3)(p) of the Companies Act, 2013 read with Rule 8(4) of the Companies (Accounts) Rules, 2014 have been provided in the Corporate Governance Report forming part of this Annual Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

(i) In terms of the provisions of Section 149, 150, 152 and other applicable provisions of the Companies Act, 2013 and the Rules made there under Mr. Dwarka Das Daga, Mr. Rajnish Gupta, Mr. Ghanshyam Das Binani and Mr. Kailash Chandra Gupta were appointed at the 23rd Annual General Meeting of the Company on 30th September, 2014, to hold office as Independent Directors of the Company for a period of five year i.e. upto 31st March, 2019.

(ii) Pursuant to the provisions of Section 152(6) of the Companies Act, 2013 and the Rules made thereunder, Mr. Padam Singhee (DIN 00021995) retires at the ensuing Annual General Meeting and being eligible offers himself for re-election.

(iii) No women Director has yet been appointed pursuant to Section 161 of the Companies Act, 2013 and SEBI guidelines pursuant to which each listed Company shall have a Women Director on its Board on or before 31st March, 2015.

(iv) Cessation the nomination of Mr. Sachikanta Mishra, Nominee Director IFCI Ltd. has been withdrawn By IFCI Ltd. Mr. Deepak Mishra was appointed as a Director on the Board of the Company on 28th March, 2015 and his nomination was also withdrawn by IFCI Ltd. vide No IFCI/NDC/2015-150603036 dated 3rd June, 2015 and he ceases to be Director on the Board of the Company from 6th June, 2015.

The Board places on record its deep appreciation for the valuable contribution made by Mr. Sachikanta Mishra and Mr. Deepak Mishra, Directors.

(v) Following existing Directors and officials have been appoint as Key Managerial Personnel of the Company in the meeting of Board of Directors held on 18th November, 2014 : -

(a) Mr. Prem Singhee, Chairman & Managing Director;

(b) Mr. Anil Kumar Saxena, Chief Financial Officer (c) Mr. Vimal Chadha, Company Secretary

(vi) Profile of Directors seeking appointment / re-appointment Profile of the directors seeking appointment / reappointment as required to be given in terms of Clause 49(VIII)(E)(1) of the Listing Agreement forms part of the Corporate Governance part of the Annual Report of the Company.

DETAILS OF SUBSIDIARY/ JOINT VENTURES

Pursuant to sub-Section (3) of Section 129 of the Act and Companies (Accounts) Rules, 2014, the statement containing the salient features of the financial statement of a Company‘s subsidiaries and joint ventures is given as Annexure V Performance and financial position of each the consolidated financial statements.

Further, the annual accounts and related documents of the subsidiary company shall be kept open for inspection at the Registered Office of the Company. The Company will also make available copy thereof upon specific request by any Member of the Company interested in obtaining the same. Further, pursuant to Accounting Standard AS-21 issued by the Institute of Chartered Accountants of India, Consolidated Financial Statements presented by the Company in this Annual Report include the financial information of its subsidiary.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS

Debt Recovery Tribunal, Delhi has directed sale of four Rigs and one directional drilling equipment by order dated 23rd June, 2015. It may be noted that the said rigs were exclusively hypothecated with ICICI Bank Ltd, Bahrain and the concerned loan of US Dollar 17.6 million will stand repaid to ICICI Bank with the sale of said assets.

INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY

The details pertaining to internal financial control systems and their adequacy have been disclosed in the Management Discussion and Analysis Report forming part of this Annual Report.

AUDIT COMMITTEE

The Company has constituted an Audit Committee in accordance with Section 177(1) of the Companies Act, 2013, the details of which have been provided in the Corporate Governance Report forming part of this Annual Report. There has been no instance where the Board of Directors had not accepted any recommendation of the Audit Committee. The Company has formulated a Whistle Blower Policy to provide vigil mechanism for employees including directors of the Company to report genuine concerns which is available on the Company’s website (www.shiv-vani.com).

COMMITTEES OF THE BOARD

The details of composition of Audit Committee and other committees of the Board of Directors along with the attendance thereof is provided in the Corporate Governance Report forming part hereof.

PARTICULARS OF EMPLOYEES

a) Statement showing details of employees drawing remuneration exceeding the limits specified in Rule the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

A statement showing details of employees drawing remuneration exceeding the limits specified in Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been provided in an Annexure-VI A which forms part of the Director’s Report.

b) Disclosures pertaining to remuneration of directors as required under Schedule V to the Companies Act,

2013

Details pertaining to remuneration of directors as required under Schedule V to the Companies Act, 2013 have been provided in the Corporate Governance Report forming part of this Annual Report. As the Company is under Corporate Debt Restructuring, the Directors are not given any remuneration including sitting fee because of tight financial position.

c) Payment of commission from subsidiaries - The Managing Director has not received any commission / remuneration from any of the subsidiaries of the Company during the year under review.

d) Information pertaining to remuneration to be disclosed by listed companies in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of

Managerial Personnel) Rules, 2014

The information / details pertaining to remuneration to be disclosed by listed companies in terms of Section

197(12) of the Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 have been provided in an Annexure-VI B.

MANAGEMENT DISCUSSION AND ANALYSIS

As required under Clause 49(VIII)(D), the Management Discussion and Analysis Report on the operations and financial position of the Company has been provided in a separate section which forms part of this Annual Report. The Management Discussion and Analysis forming part of this Annual Report for the year ended 31st March, 2015 at Annexure – VII.

CORPORATE GOVERNANCE

As required under Clause 49(X) of the Listing Agreement entered into by the Company with the stock exchanges, a detailed report on corporate governance has been provided in a separate section which forms part of this Annual

Report. The Company is in compliance with the requirements and disclosures that have to be made in this regard except Clause 49(II)(A)(1). The auditors’ certificate on compliance with corporate governance requirements by the Company is attached to the Corporate Governance Report.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013.

Pursuant to the provisions of the Sexual Harassment of Women at Work Place (Prevention, Prohibition and Redressal) Act, 2013 read with Rules as amended upto date, the Company has constituted a Central Internal Complaints Committee at its office. Central Internal Complaints Committee has been given the responsibility to receive and address the complaints received, if any, at all locations where the Company is present. The Company has also taken certain steps to create awareness about familiarization to the said policy having been put in place. There was no instance of alleged sexual harassment reported during the year under review.

TRANSFER OF AMOUNTS TO INVESTORS EDUCATION AND PROTECTION FUND

Your company did not have any funds lying unpaid or unclaimed for a period of seven years. Therefore, no funds were required to be transferred to Investors Education and Protection Fund (IEPF).

CODE OF CONDUCT AND ETHICS

The Board of Directors has adopted a Code of Conduct and Ethics for the Directors and Senior Executives of the Company. The objectives of the Code is to conduct the Company’s business ethically and with responsibility, integrity, fairness, transparency and honesty. The Code sets out a broad policy for one’s conduct in dealing with the Company, fellow Directors and Employees with the environment in which the Company operates. The Code is available on the

Company’s website :www.Shiv-vani.co.in/com. OTHER DISCLOSURES

a) Deposits - During the year under review, the Company has not accepted any deposits falling within the purview of Section 73 of the Companies Act, 2013.

b) Equity shares with differential voting rights - During the year under review, the Company has not issued equity shares with differential voting rights as to dividend, voting or otherwise.

c) Sweat equity shares - During the year under review, the Company has not issued any sweat equity shares.

d) Revision of financial statementsanddirectorsreport - The Company was not required to revise its financial statements or directors’ report during the year under review.

HUMAN RESOURCES

Your Company had cordial relations with employees across all locations during the year.

ACKNOWLEDGEMENTS

The Directors wish to place on record their appreciation for the co-operation and support received from the government and semi government agencies, especially from the Ministry of Petroleum and Natural Gas, Government of India, all state level nodal agencies.

The Directors are thankful to all the Bankers, Financial Institutions and the Investor Group for their support to the Company. The Board places on record its appreciation for continued support provided by the esteemed customers, suppliers, bankers, financial institutions, consultants, bondholders and shareholders.

The Directors also acknowledge the hard work, dedication and commitment of the employees. Their enthusiasm and unstinting efforts have enabled the Company to emerge stronger than ever enabling it to maintain its position as one of the leading players in the wind industry in India and around the world.

		For and on behalf of the Board of Directors
	(Padam Singhee)	(Dwarka Das Daga)
New Delhi	Joint Managing Director	Director
August 14, 2015	DIN: 00021995	DIN: 00039664

Annexure-II

Form No. MR-3

SECRETARIAL AUDIT REPORT

FOR THE FINANCIAL YEAR ENDED 31ST MARCH, 2015

[Pursuant to section 204(1) of the Companies Act, 2013 and Rule No 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014]

To,

The Members,

SHIV-VANI OIL & GAS EXPLORATION SERVICES LIMITED Tower-1, 5 Floor, NBCC Plaza, Sector V, Pushp Vihar, Saket, New Delhi-110017

Sir,

I have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by SHIV-VANI OIL & GAS EXPLORATION SERVICES LIMITED (hereinafter called the company).

Secretarial Audit was conducted in a manner that provided me a reasonable basis for evaluating the corporate conducts / statutory compliances and expressing my opinion thereon.

Based on my verification of the Company’s books, papers, minute books, forms and returns filed and other records main -tained by the company and also the information provided by the company, its officers, -tives during the conduct of secretarial audit, I hereby report that in my opinion, the company has, during the audit period covering the financial year ended on 31st March, 2015 complied with 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:

I have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for the financial year ended on 31st March, 2015 according i. The Companies Act, 2013 (the Act) and the rules made thereunder;

Following were the observations during the audit period:

a) The Company has not complied the provisions of section 149 (1) with respect to appointment of Woman Director with in the transition period given in the Act.

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

iii. The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder;

iv. Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings;

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

Following were the observations during the audit period:

1. The Company has complied the provisions of regulation 30(1) with respect to continual disclosure and regulation of 31(1) with respect to disclosure of encumbered shares but has not intimated to the stock exchanges.

b. The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992.

c. The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009.

d. The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999.

e. The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008.

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.

g. The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009. and

h. The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998.

vi. Other laws as applicable specifically to the company-

1. Explosives Act, 1884

2. Mines and Minerals (Regulations and Development) Act, 1957

3. Oil Industry Development Act, 1974.

I have also examined compliance with the applicable clauses of the following:

(i) Secretarial Standards issued by The Institute of Company Secretaries of India.

Not Applicable during the Audit Period as these Secretarial Standard were not effective till the last day of the audit period.

(ii) The Listing Agreement entered into by the company with Stock Exchanges.

I further report that:

The Board of Directors of the company is duly constituted with proper balance of Executive Directors, Non-Executive Directors and Independent Directors except Women Director. The changes in the composition of the Board of Directors that took place during the period under review were carried out in compliance with the provisions of the Act.

Adequate notices are given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent at least seven days in advance, 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.

Majority decision is carried through and there were no dissenting members’ on any resolution.

I 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.

I further report that during the audit period the company has come across the following major events:

i. CDR Scheme of the Company was approved by CDR-EG on 24th January, 2014 and is under implementation. However, the Company could not show progress during the Audit period, as Oil Majors have not come with major tenders during this period.

ii. That the Company on 8th July 2010 had issued Bonds worth of US$ 80,000,000 5% convertible bonds due on 17th August 2015. The Company agreed to pay interest @ 5% p.a. semi-annually on 16th January and 16th July in each year upto the due date. However, Company could not discharge the interest due on 16th July 2013. On such occurance of Event of Default, the trustee Citicorp International Limited (Citicorp), accelerated the entire Bond amount. The Company’s offered the defaulted interest amount of $ 2 million Dollars in first week of August 2013. The Citicorp refused to receive the amount and claimed entire Bond amount together with interest. Citicorp on 23rd August filed Company petition No. 446/2013 in Hon’ble High Court of Delhi to Wind up Shiv-Vani and the same is pending. Citicorp has also filed Proceedings in London Court for recovery of US$ 84 million. The London Court passed summary judgment on 11th February 2014.

iii. The Company could not pay its service tax liability from the year 2010-11 to 2012-13. The Company had moved a writ petition before the Hon’ble High Court of Delhi to allow it to pay the service tax in installments. The Hon’ble High Court of Delhi directed on 28/05/2014 to pay the same to the department equivalent to 1/3rd of the amount received from its client as turnover proceeds in Trust and Retention Account (TRA) maintained with ICICI Bank Ltd. The said arrangement is continuing.

For VLA Associates

Company Secretaries

Vishal Lochan Aggarwal

Proprietor

FCS No.: 7241 C P No.: 7622

New Delhi

June 6, 2015

Annexure – III

Form AOC - 2

Pursuant to clause (h) of sub-section (3) of Section 134 of the Act and Rule 8 (2) of the Companies (Accounts) Rules, 2014

Form for disclosure of particulars of contracts/ arrangements entered into by the Company with related parties referred to in sub-section (1) of Section 188 of the Companies Act, 2013 including certain arm’s length transactions under third proviso thereto.

1 Details of contracts or arrangements or transactions not at arm’s length basis : Shiv-Vani Oil & Gas Exploration Services Ltd. has not entered into any contract or arrangement or transaction with its related parties which is not at arm’s length during the financial year 2014-15.

2 Details of material contracts or arrangements or transactions at arm’s length basis :

(a) Names of related party and nature of relationship : Oriental Oil & Gas Services Ltd, Mauritus a Wholly owned subsidiary of the company.

(b) Nature of contract or arrangement or transaction : Agreement of lease of Rigs

(c) Duration of contracts or arrangements or transactions: Contract Dt 09.04.2009 as amended on 01.10.2011 and 09.02.2015, which is ongoing.

(d) Salient terms of contracts or arrangements or transactions Including the value, if any.

1. Rental period shall be on monthly basis.

2. Rent shall be paid free of all setoff, claims, counter claims, demands and withholding.

3. The lessee shall bear all the risks of loss, damage & destruction of or to the rigs throughout the lease period.

4. The lessee shall pay and discharge all taxes,rates, rents and governmental charges upon the lessee and its assets.

(e) Date(s) of approval by the Board: Not applicable, since the contract was entered in the Ordinary course of business and on arm length basis.

(f) Amount paid as advances, if any.: Nil

		For and on behalf of the Board of Directors
	(Padam Singhee)	(Dwarka Das Daga)
New Delhi	Joint Managing Director	Director
August 14, 2015	DIN: 00021995	DIN: 00039664

Annexure – IV

Disclosure of particulars with respect to conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to Section 134(3)(m) of the Act.

A. Conservation of Energy

1 The steps taken or impact on conservation of energy :

Energy saving measures adopted across all offices and sites. Continued efforts towards optimization of processes are in place i.e. uses of solar panels and led bulbs, replacing the new electrical items wherever electrical items are very old etc. Various operating activities are identified to ensure conservation of higher to lower capacity power packs/ electric generators, reducing fuel and other consumable consumption hence making operations economical.

2 Steps taken by Company for utilizing alternate source of energy:

Various steps have been adopted to reduce dependency on commonly used energy. Steps are being taken for using solar panels etc,

3 Capital investment on energy conversation equipments: Nil.

B. Absorption of Technology

(1) Being Oil & Gas Exploration Service providers, endeavour of company remain to optimize overall performance of Man and Machinery. A team of Drilling Engineers with Oilfield Professionals monitor study and implement various techno commercial measures : -

- All Drilling Rigs are equipped with latest field proven Top Drive Systems to enhance performance during Rig Operations.

- Hydraulically operated Disc Brake System Draw works are installed for safe and efficient conditions.

- Latest engineering designed Solid control systems including Linear Motion Shale Shakers, Centrifuges and Jet Shearing Devicesareinstalledtoreducesolidcontents fluidsreducing running and drilling maintenance cost of equipment and simultaneously enhance equipment life.

- To keep Third Mud Pump as standby during parallel pumping to enhance Directional Drilling Performance.

- For hard to very hard formation drilling, Turbine drilling methods are used.

- Using latest technology drilling operations are performed using Mud Motors, MWD and directional drilling equipment.

- Use of PDC Bits during Drilling operations to enhance efficiency of rigs.

- Real time data accessible online is used with latest Rig sense electronics instrumentation system for precise monitoring of drilling and Mud parameters to further enhance performance.

(2) Benefits derived as a result of the above efforts (like product improvement, cost reduction, product development or import substitution)

Benefits derived as a result of R & D

(a) Our team of engineers and technicians developed SS impellers in our work shop which resulted in improvement of life of those impellers by 4 times.

(b) Our team of engineers with experiments found that drill bits with 2 blades are suitable for these types of soils and modified the three blade bits to two blade bits. The drilling time has been reduced by half.

(3) Future Plan and Action are faced to provide water for1. Presently drilling, research is being carried thehillyarealot ofdifficulties out to overcome the problem.

2. The sleeves of mud pumps are getting damaged very frequently, efforts are made to use different material for manufacture of sleeves to arrest the down time due to damage of sleeves.

(4) In case of imported technology (imported during the last three years reckoned from the beginning of the financial year)

No technology was imported during the last five years.

(5) Expenditure as R & D

Capital :	Nil
Recurring :	Nil
R & D :	Nil
%age of turnover :	Nil

C Foreign Exchange Earnings & Outgo

	Amount (Rs)
	March-15	March-14
1 Earning in Foreign Currency
Contract Revenue (Gross)	Nil	82,571,765
Sale of Goods	Nil	246,253
Interest on FDR	7,321	10,985
Total	7,321	82,829,003
2 Expenditure in Foreign Currency
Rig Rental Charges	15,850,839	78,504,511
Interest	218,876,055	318,962,981
Legal & Professional fees	514,952	4,232,422
Travelling Expenses	1,158,635	998,715
Contract Expenses	Nil	2,958,617
Freight and other expenses	Nil	17,667,178
Total	236,400,481	423,324,424

 

		For and on behalf of the Board of Directors
	(Padam Singhee)	(Dwarka Das Daga)
New Delhi	Joint Managing Director	Director
August 14, 2015	DIN: 00021995	DIN: 00039664

ANNEXURE - V

FORM AOC-1

(Pursuant to first proviso to sub-section 3 of Section 129 read with rule 5 of Companies (Accounts) Rules, 2014) Statement containing salient features of the financial statement of subsidiaries/associate companies/joint ventures

Part A – Indian Subsidiaries

S No.	Particulars	Shiv-Vani Oil Services Ltd. (1)	Shiv-Vani Energy Ltd. (2)	Shiv-Vani Infra Limited (3)	TNG Shiv Geo Services Limited (4)
(a)	Reporting period	1st April 2014 to	1st April 2014 to	1st April 2014 to	1st April 2014 to
		31st March 2015	31st March 2015	31st March 2015	31st March 2015
(b)	Reporting currency	Rupees	Rupees	Rupees	Rupees
(c)	Exchange rate as on 31-03-2015	-	-	-	-
(d)	Share Capital	10,000,000	5,00,000	5,00,000	5,00,000
(e)	Reserves and Surplus	(1,148,478)	(7,598,990)	-	(211,448)
(f)	Total Assets	9,668,992	800,172,112	15,175,629	304,752
(g)	Total Liabilities	817,470	807,271,102	14,675,629	16,200
(h)	Investment	-	560,000,000	-	-
(i)	Turnover/Income	-	47,764,557	-	-
(j)	Profit before Taxation	(2,905,268)	(171,967)	-	(26,124)
(j) a	Deferred Tax Asset (Net)	-	(466,564)	-	-
(k)	Provision for Taxation	-	-	-	-
(l)	Profit after Taxation	(2,905,268)	294,597	-	(26,124)
(m)	Proposed Dividend	-	-	-	-
(n)	%age of shareholding	-	-	-	-

Foreign Subsidiaries

S.No.	Particulars	Shiv-Vani Oil & Gas Co., LLC, Oman (4)		Shiv-Vani Singapore Pte Ltd. (5)		Global Exploration Pte Ltd., Singapore (6)		Oriental Oil & Natural Gas Ltd., Mauritius (7)
(a)	Reporting period	1st April,2014 to31st March, 2015		1st April,2014 to31st March, 2015		1st April, 2014 to31st March, 2015		1st April, 2014 to31st March, 2015
(b)	Reporting currency	Omani Rial	INR	USD	INR	USD	INR	INR	USD INR
(c)	Exchange rateas on 31-03-2015	161.697		62.5908		62.5908		62.5908
(d)	Share Capital	5,00,000	80,848,500	71	4,444	1	63	34000	2128087
(e)	Reserves and Surplus	7,436,838	1,202,514,394	(35,049,428)	(2,193,771,738)	(12,914)	(808,298)	59,575,762	3,728,894,604
(f)	Total Assets	26,974,731	4,361,733,079	72,028,572	4,508,325,944	8,968,768	561,362,364	74815391	4,682,755,175
(g)	Total Liabilities	19,037,893	3,078,370,184	107,077,929	6,702,093,238	8,981,681	562,170,599	15,205,629	951,732,484
(h)	Investment	-	-	-	-	-	-	16,146	1,010,591
(i)	Turnover/Income	5,365,975	867,662,060	6,505	407,153	-	-	258,750	16,195,379
(j)	Profit before Taxation	(911,718)	(147,422,065)	(12,228,902.21)	(765,416,772)	(2,720)	(170,247)	(5,713,589)	(357,618,106)
(k)	Provision for Taxation	41,526	6,714,630	-	-	-	-	-	-
(l)	Profit after Taxation	(953,244)	(154,136,695)	(12,228,902)	(765,416,772)	(2,720)	(170,247)	(5,713,589)	(357,618,106)
(m)	Proposed Dividend	-	-	-	-	-	-	-	-
(n)	%age of shareholding	-	-	-	-	-	-	-	-

 

S.No.	Particulars	Natural Oil and Gas Services Ltd. Mauritius (4)		SV Videsh Ltd., Cyprus (5)		Oil Blocks Holdings Ltd., Cyprus (6)
(a)	Reporting period	1st April,2014 to31st March, 2015		1st April,2014 to31st March, 2015		1st April, 2014 to31st March, 2015
(b)	Reporting currency	USD	INR	USD	INR	USD	INR
(c)	Exchange rate as on31-03-2015	62.5908		62.5908		62.5908
		1	63	1,573	98,455	1,573	98,455
(d)	Share Capital	6,334,966	396,510,574	(32,772)	(2,051,226)	(32,862)	(2,056,859)
(e)	Reserves and Surplus	123,098,455	7,704,830,777	2,479	155,163	2,479	155,163
(f)	Total Assets	116,763,488	7,308,320,140	33,678	2,107,933	33,768	2,113,566
(g)	Total Liabilities	-	-
(h)	Investment	-	-
(i)	Turnover/Income	(16531110)	(1,034,695,400)	-	-	(1,966)	(123,054)
(j)	Profit before Taxation	-	-	(1,966)	(123,054)	-	-
(k)	Provision for Taxation	(16531110)	(1,034,695,400)	(1,966)	(123,054)	(1,966)	(123,054)
(l)	Profit after	-	-	-	-	-	-
(m)	Proposed Dividend	-	-	-	-	-	-
(n)	% age of shareholding	-	-	-	-	-	-

 

		For and on behalf of the Board of Directors
	(Padam Singhee)	(Dwarka Das Daga)
New Delhi	Joint Managing Director	Director
August 14, 2015	DIN: 00021995	DIN: 00039664

Annexure – VI A

Statement showing names of employees under the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

S N

Name of employee

Designation

Remunera- tion received (Rs)

Nature of employ- ment

Qualification

Experience (yrs)

Date of com- mencement of employment

Date of Leaving

Age (Yrs)

Last Employ- ment

%age of eq- uity shares held

Whether relative of Director or Manager

(i)

If employed throughout the financial year, was in receipt of remuneration for that year which, in the aggregate, was not less than sixty lacs rupees :Nil

(ii)

If employed throughout the financial year, was in receipt of remuneration for any part of that year, at a rate which,intheaggregate,wasnotlessthanfivelacsrupees : per month

(a)

Rajan Gupta

Chief Financial Officer

60,04,800/-

Otherwise

CA & CS

35

22-Apr-96

31st Decem- ber, 2014

56

U P Airways Ltd.

Nil

No

(b)

Satish Dhar

Chief Operating Officer

92,90,332/-

Otherwise

IIT, Roorkee, Master in Engg. (Mechanical)

35

7-May-14

16th March 2015

60

Sun Drilling LLP

Nil

No

(iii) If employed throughoiut the financial year, was in receipt of remuneration for that year which, in the aggregate, is in excess of that drawn by Managing Dirrector or whole time director or Manager and holds himself and along with his spouse and dependent children, not less than two per cent of the equity shares of the Company : Nil

Annexure – VI B

The following disclosures are made in terms of Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 : -

(i ) the ratio of the remuneration of each Director to the median remuneration of the Employees of the Company for the financial year; Chairman & Managing Director and Joint Managing Director -

The detail of remuneration paid to Chairman & Managing Director and Joint Managing Director of the Company are as under :

S. No	Name of the Director	Remuneration (Rs in lacs)	Ratio to median remuneration
1	Mr Prem Singhee, CMD	Nil	-
2	Mr Padam Singhee, JMD	Nil	-

As per CDR Scheme approved by CDR-EG. We are not paying any remuneration, sitting fees etc, to the Directors

Independent Directors

S No.	Name of the Director	Sitting fee	Commission	Others	Total Amount (Rs)	Ratio to median remuneration
1	Mr Rajnish Gupta	Nil	Nil	Nil	Nil	-
2	Mr Dwarka Das Daga	Nil	Nil	Nil	Nil	-
3	Mr Ghanshyam Das Binani	Nil	Nil	Nil	Nil	-
4	Mr Kailash Chandra Gupta	Nil	Nil	Nil	Nil	-

As per CDR Scheme approved by CDR-EG. We are not paying any remuneration, sitting fees etc, to the Directors

Other Non Executive Directors

S. No.	Name of the Director	Sitting fee	Commission	Others	Total Amount (Rs)	Ratio to median remuneration
1	Mr Sachikanta Mishra, IFCI Nominee (upto 28th March, 2015)	Nil	Nil	Nil	Nil	-
2	Mr Deepak Mishra, IFCI Nominee (upto 06th June, 2015)	Nil	Nil	Nil	Nil	-

As per CDR Scheme approved by CDR-EG. We are not paying any remuneration, sitting fees etc, to the Directors

(ii) The percentage of increase in remuneration of each Director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year.

S. No.	Name of the Director	Category	Remuneration (Rs in lacs)		Increase/ (decrease) (%)
			2014-15	2013-14
1	Mr PremSinghee	CMD	Nil	Nil	-
2	Mr Rajan Gupta (upto 31st December, 2014)	CFO	6004800	7599600	-20.98
3	Mr Anil Kumar Saxena (w.e.f. 18th November, 2014)	CFO	208544	-	-
4	Mr Vimal Chadha	Company Secretary	1604400	1633200	-1.76

As per CDR Scheme approved by CDR-EG. We are not paying any remuneration, sitting fees etc, to the Directors

(iii) The percentage of increase in the median remuneration of employees in the financial year;

Particulars	Remuneration (Rs in lacs)	Increase/ (Decrease) (%age)
Median remuneration of all employees per annum	1.04	-

(iv) The number of permanent employees on the roll of Company (2015)

Particulars	31-Mar-15	31-Mar-14
Number of permanent employees on rolls of the Company as at the end of the financial year	7592	5266

(v) The explanation on the relationship between average increase in remuneration and company performance.

Particulars	Remuneration (Rs in lacs)		Increase/ (decrease) (%age)
	2014-15	2013-14
Average remuneration	435497	579715	-25

As per CDR Scheme approved by CDR-EG. We are not paying any remuneration, sitting fees etc, to the Directors

(vi) Comparision of the remuneration of the Key Managerial Personnel against the performance of the company.

Particulars	Remuneration ( Rs )
	CMD	CFO	CS	Total considering all KMPs
Remuneration of KMPs paid during the financial year 2014-15	Nil	2,08,544	1,604,400	18,12,944
Revenue for the financial year 2014-15	2,070,299,901
Remuneration of all KMPs as % of revenue	-	0.01%	0.08%	0.09%
Profit/(loss) before tax for the financial year 2014-15	-5,964,603,242
Remuneration of KMPs as % of profit before tax	-	0.00%	-0.02%	-0.03%

(vii) Variations in the market capitalization of the Company, price earnings ratio as at the closing date of the current financial year and previous financial year,and percentage increase over decrease in the market quotations of the shares of the Company in comparison to the rate at which the Company came out with the last public offer.

Particulars	March 31, 2015 (Rs)	March 31, 2014 (Rs)	Change - Increase / (decrease)%
Market Capitalisation (Rs in Crores)	35.00 Crore	54.47 Crore	(35.74)
Price Earning Ratio	(0.06)%	(10.33)%	99.42

 

Particulars	Closing market price as on March 31, 2015	Issue price for the initial Public offer	Issue price for initial Public offer adjusted for sub-divi- sion	Change – increase/ (decrease)%
NSE	7.55	10	-	Nil
BSE	6.02	10	-	Nil

(viii) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration.

Particular		Remuneration		Increase / Decrease (%)
		2014-15	2013-14
Average Salary of all Employees (other than KMPs		435497	579715	-24.87
Salary of Managing Director		0	0	0
Salary of CFO	Mr. Rajan Gupta (upto 31st December, 2014)	6004800	7599600	-20.98
	Mr. Anil Kumar Saxena (KMP) (w.e.f 18th Nov,2014)	208544	-	-
Salary of CS	Mr. Vimal Chadha (KMP)	1604400	1633200	-1.76
Average Salary of all KMPs mentioned above		1812944	1633200	11

Justification for increase / reasons for decrease in remuneration

As per CDR Scheme approved by CDR-EG. We are not paying any remuneration, sitting fees etc, to the Directors and no increase in remuneration of the employees.

(ix) Comparison of the each remuneration of Key Managerial Personnel against the performance of the Company.

See point no. Vi above

(x) The key paramaters for any variable component of remuneration availed by the Director.

No remuneration was given to Directors.

(xi) The ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year; and

Note: Since, directors are not paid any remuneration during the year, this is not applicable.

(xii) Affirmation that the remuneration is as per the remuneration policy of the Company.

It is hereby affirmed that the remuneration paid to directors and managerial personnel referred to above is as per the remuneration policy of the Company.

		For and on behalf of the Board of Directors
	(Padam Singhee)	(Dwarka Das Daga)
New Delhi	Joint Managing Director	Director
August 14, 2015	DIN: 00021995	DIN: 00039664