Aarcon Facilities Ltd Directors Report

The financial results for the year as under: (Rupees in Lacs)

Your Board does not recommend any dividend for the financial year 2024-25.

Your Board does not propose to carry to any reserves for the financial year 2024-25.

There was revenue from operation of Rs. 98.60 lacs during the FY 2024-25 as compared to Rs. 85.33 lacs during the previous FY 2023-24 and there is profit of Rs. 12.68 lacs during the FY 2024-25 as compared to Net Profit of Rs. 23.56 lacs during the previous FY 2023-24.

There was no change in the nature of business during the FY 2024-25.

No material changes occurred subsequent to the close of the financial year of the Company to which the balance sheet relates and the date of the report.

No significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and companys operations in future during the financial year and or subsequent to the close of the financial year of the Company to which the balance sheet relates and the date of the report.

The management of the Company has taken adequate steps for internal financial controls with reference to Financial statements.

Your Company has no Subsidiary/Joint Ventures/Associate Companies during the year.

10. Performance and financial position of each of the subsidiaries, associates and joint venture companies included in the consolidated financial statement

Your Company has no Subsidiary/Joint Ventures/Associate Companies during the year.

11. DEPOSITS

Your Company has not accepted any deposit during the year and there was no deposit at the beginning of the year. Therefore the details relating to deposits, covered under Chapter V of the Act is not applicable.

12. STATUTORY AUDITORS

M/s M/s. V J Amin & Co., Chartered Accountants, having Firm Registration No. 100335W), were appointed as the Statutory Auditors of the Company for a tenure of 5 (five) years, to hold office from the conclusion of the 28^th AGM held on ________ until the conclusion of the ensuing AGM. M/s. V J Amin & Co., Chartered Accountants, tenure of 5 (five) years as Statutory Auditors concludes at this ensuing AGM.

The Company has received confirmation from the Statutory Auditors to the effect that their appointment, if made, will be in accordance with the limits specified under the Act and the firm satisfies the criteria specified in Section 141 of the Act read with Rule 4 of the Companies (Audit and Auditors) Rules, 2014.

The Board of Directors of the Company on the recommendation of the Audit Committee has reappointed M/s. V J Amin & Co., Chartered Accountants, having Firm Registration No. 100335W as the Statutory Auditors of the Company pursuant to Section 139 of the Act for a second term 5 (five) years to hold office from the conclusion of the ensuing AGM till the conclusion of 37^th AGM of the Company to be held in the year 2030, subject to approval by the Members at the ensuing AGM.

The Board recommends to seek consent of its Members at the ensuing AGM on re-appointment of M/s. V J Amin & Co., Chartered Accountants, having Firm Registration No. 100335W as Statutory Auditors for tenure of 5 (five) years, to examine and audit the accounts of the Company during the said period.

The Statutory Auditors report does not contain any qualifications, reservations, adverse remarks or disclaimers, which would be required to be dealt with in the Boards Report.

M/s. Nakul & Kush., Chartered Accountants, had been appointed as an Internal Auditors at the meeting of the Board of Director held on 8^th August, 2024 for the FY 2024-25 for conducting internal audit of the company.

13. AUDITORS REPORT

The observations of the Auditors are explained, wherever necessary, in an appropriate notes to the Audited Statement of Accounts. No qualification, reservation or adverse remark or disclaimer has been made by the auditor in their report for the FY 2024-25.

14. SHARE CAPITAL

During the year under review, the Company has not issued any securities nor has granted any stock option or sweat equity.

15. Web link for Annual return

As per the provisions of Section 92(3) read with Section 134(3) of the Act, Annual Return for the Financial Year ended on 31^st March, 2025, in prescribed Form No. MGT 7 is available on the website of the Company on www.aarconfacilities.com.

16. Conservation of energy, technology absorption and foreign exchange earnings and outgo

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are attached herewith (Annexure-A)

17. Corporate Social Responsibility (CSR)

Since the Company does not qualify any of the criteria as laid down in Section 135(1) of the Companies Act, 2013 with regard to Corporate Social Responsibility, provisions of Section 135 are not applicable to the Company.

18. Directors

A) Changes in Directors and Key Managerial Personnel

Mr. Anupama Bharat Gupta, Director of the Company, retired by rotation and re-appointed at the annual general meeting held on 29^th September, 2025.

B) Declaration by Director(s) and re- appointment, if any

Re-appointments:

Mr. Anupama Bharat Gupta, Director of the Company retiring by rotation and eligible for re-appointment has given his consent and declaration under form DIR-8 pursuant to Section 164(2) read with Rule 14(1) of Companies (Appointment and Qualification of Directors) Rules, 2014.

Details of director seeking re-appointment as per regulation 36 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015 is attached herewith. (Annexure- D). C) Formal Annual Evaluation

The Company has devised a policy for performance evaluation of Independent Directors, Board, Committees and individual Directors which includes criteria for performance evaluation of executive directors and non-executive directors.

In evaluating the suitability of individual Board members, the Committee may take into account factors, such as: i. General understanding of the Companys business; ii. Educational back ground and experience: iii. Personal and professional ethics, integrity and values; iv. Willingness to devote sufficient time and energy in carrying out their duties and responsibilities effectively.

D) Opinion of the Board:

Your Board is of opinion that independent directors of the Company, appointed / reappointed at the last AGM, possess requisite qualifications, experience and expertise and they hold good standard of integrity in various fields.

19. Number of meetings of the Board of Directors

During the year from 1^st April, 2024 to 31^st March, 2025 the Board of Directors met five times on the following dates:

20. Audit Committee

The Audit Committee of the Company comprising of the following Directors of the Board:

There was no occasion regarding non acceptance of any recommendation of the Audit Committee during the year. Audit Committee meetings were held on 13/05/2024, 08/08/2024, 14/11/2024 and 28/01/2025 during the year. Note: The constitution of above committee doesnt comply with the provision of the Section 177(2) of the Companies Act, 2013 not forming majority of independent director in the committee.

21. Details of establishment of vigil mechanism for directors and employees

Your Board has established vigil mechanism pursuant to rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 to oversee the efficient working of the vigil mechanism.

The vigil mechanism Committee of the Company comprising of the following Directors of the Board:

The Company has framed a whistle blower policy in terms of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015.

22. Nomination and Remuneration Committee

The Nomination and Remuneration Committee of the Company comprising of the following Directors of the Board:

The policy formulated by Nomination And Remuneration Committee:

The terms of reference of the committee inter alia include succession planning for Board of Directors and Senior Management Employees, identifying and selection of candidates for appointment of Directors/Independent Directors based on certain laid down criteria, identifying potential individuals for appointment of Key Managerial personnel and other senior managerial position and review the performance of the Board of Directors and Senior Management personnel including Key managerial personnel based on certain criteria approved by the Board. While reviewing the performance, the committee ensures that the remuneration is reasonable and sufficient to attract, retain and motivate the best managerial talents, remuneration commensurate with the performance of individual and group and also maintains a balance between both short and long term objectives of the company.

The meeting of Nomination and Remuneration committee was held on 13/05/2024 during the financial year under review.

Note: The constitution of above committee doesnt comply with the provision of the Section 178(1) of the Companies Act, 2013.

23. Stakeholders Relationship Committee

The Stakeholders Relationship Committee of the Company comprising of the following Directors of the Board:

The meeting of Stakeholders Relationship committee was held on 13/05/2024 during the year under review.

24. Particulars of loans, guarantees or investments under section 186

The Company has not given any loan, guarantees or investments under section 186 to any person or body corporate except loan to employees of the Company as per Companys policy for employees.

25. Particulars of contracts or arrangements with related parties:

The Company has not entered into any contract or arrangement with related party referred to in sub-section (1) of section 188 of the Companies Act, 2013. Form No. AOC-2 regarding transactions under section 188 of the Companies Act, 2013 is enclosed herewith (Annexure-B).

26. Disclosure of Remuneration of employees covered under Rule 5(2) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014

None of the employee of your Company, who was employed throughout the financial year, was in receipt of remuneration in aggregate of Rupees One Crore and Two Lakhs or more or if employed for the part of the financial year was in receipt of remuneration of Rupees Eight Lakh & Fifty Thousand or more per month.

27. Secretarial Audit Report

The Secretarial Audit Report pursuant to Section 204 (1) of the Companies Act,2013 given by M/s Devesh R Desai., Practicing Company Secretaries has been enclosed herewith (Annexure-C).

The Secretarial Audit Report does not contain any qualification, reservation or adverse remark except:

a. The Audit committee of the Company was not constituted as required under Section 177 of the Companies Act, 2013 during the year under review, due to not forming a majority by independent directors.

b. The Nomination and Remuneration committee of the Company has not been constituted as required under Section 178 of the Companies Act, 2013 which requires three or more non-executive directors out of which not less than one half shall be independent directors.

c. The Company has not published quarterly / annual financial result in any newspaper during the year under review as required under Regulation 33 and 47 of SEBI (LODR) Regulation, 2015.

d. The Company has paid annual listing fees partially to BSE for the FY 2024-25 and not paid for FY 2025-26 till date of report.

e. The Company has not registered itself on SCORE platform as required under Regulation 13 of SEBI

(LODR) Regulation, 2015.

Explanation:

a) The Company is in search of the proper candidate for the position of an Independent Director and could not find proper person to fill in vacancy of an Independent Director. Audit committee of the Company will be re-constituted after appointment of Independent Director as required under Section 177 of the Companies Act, 2013.

b) The Company is in search of the proper candidate for the position of an Independent Director and could not find proper person to fill in vacancy of an Independent Director. The Nomination and Remuneration committee of the Company will be re-constituted after appointment of Independent Director as required under Section 178 of the Companies Act, 2013.

c) As the financial position of the Company is not sound, the Company has not published quarterly / annual financial result in any newspaper during the year under review.

d) The Company had paid the partial fees for the FY 2024-25 to the BSE and will pay all the remaining fees for FY 2025-26 very soon.

e) The Company will register with the SCORE platform as required under Regulation 13 of SEBI (LODR) Regulation, 2015 very soon.

28. Corporate Governance Report

As stipulated in the Regulation 72 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015, the Company does not require to comply with Regulation 17 to Regulation 27 of the said regulation as Paid-up Capital does not exceed Rs. 10 Crores or Net worth does not exceed Rs. 25 Crores which is specified in Regulation 15 and hence did not need to obtain Corporate Governance Report.

29. Disclosures required under Schedule V regarding Annual Report pursuant to Regulation 34(3) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015:

Disclosures mentioned in Para A of Schedule V:

Disclosures regarding compliance with the Accounting Standard on ‘Related Party Disclosures has been given in the notes to the accounts.

Disclosures mentioned in Para B of Schedule V:

The Management Discussion and Analysis Report has been attached along with the Directors Report as

Annexure E.

Disclosures mentioned in Para C, D and E of Schedule V:

Pursuant to Regulation 15(2) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015, Para C, D and E of Schedule V does not apply to the Company.

Disclosures mentioned in Para F of Schedule V:

There are no shares in demat suspense account or unclaimed suspense account.

30. Code of Conduct :-

The Company has adopted a code of conduct for its directors and designated senior management personnel. All the Board members and senior management personnel follow compliance of code of conduct.

31. Risk management policy

In todays economic environment, Risk Management is a very important part of business. The main aim of risk management is to identify, monitor and take precautionary measures in respect of the events that may pose risks for the business. Your Companys risk management is embedded in the business processes. Your company has identified the following risks:

32. Directors Responsibility Statement

Your Directors state that

a. in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

b. the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;

c. 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 controls are adequate and were operating effectively.

f. 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.

33. Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013:

The Company has framed an anti-harassment policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaint Committee has been set up to redress complaints received regularly. All employees (permanent, contractual, temporary, trainees) are covered under the policy. There was no compliant received from any employee during the financial year 2023-24 and hence no complaint is outstanding as on 31/03/2025 for redressal.

34. Compliance with Secretarial Standards and SEBI (Listing Obligation and Disclosure Requirement) Regulations.2015:

The Company has complied with secretarial standards issued by the Institute of Company Secretaries of India and SEBI (Listing Obligation and Disclosure Requirement) Regulations 2015 as applicable to the Company from time to time except the following:

35. Details of fraud reported by auditors under sub-section (12) of section 143 other than those which are reportable to the Central Government.

There was no fraud reported by auditors under sub-section (12) of section 143 other than those which are reportable to the Central Government.

36. Disclosure regarding maintenance of cost records:

Your Company is not required to maintain cost records as specified by the Central Government under subsection 1 of section 148 of the Companies Act, 2013.

37. Details of proceedings under the Insolvency and Bankruptcy Code, 2016

There was no proceeding pending against the Company under the Insolvency and Bankruptcy Code, 2016 during the year under review.

38. Maternity Benefit Affirmation

The Company confirms that it has followed the Maternity Benefit Act, 1961. All eligible women employees received the required benefits, including paid leave, continued salary and service, and post-maternity support like nursing breaks and flexible work options.

39. Acknowledgements

The Board of Directors gratefully acknowledge the assistance and co-operation received from the Bank of India, Indusind Bank and all other statutory and non-statutory agencies for their co-operation.

The Board of Directors also wish to place on record their gratitude and appreciation to the members for their trust and confidence shown in the Company.

The Board of Directors would like to especially thank all the employees of the Company for their dedication and loyalty.