Arihant Multi Commercial Ltd Directors Report.

To,

Members,

ARIHANT MULTI COMMERCIAL LIMITED

The Directors present the 36th Annual Report and Audited Accounts of the Company for the year ended 31st March 2018.

1. Financial Summary or highlights

The summarized financial results of the company for the year ended 31st March, 2018 are presented below:

(Rs in Lacs)
Financial Results Current Year Previous Year
2017-2018 2016-2017
Revenue from Operations 41,463,704 34,800,468
Other Income 9,964,886 10,862,769
Total (A) 51,428,590 45,663,237
Expenses
Purchases of stock in trade 111,699,397 63,379,379
Changes in inventories (60,808,882) (18,325,466)
Employee Benefits expense 244,000 139,889
Depreciation and Amortization expense 16,317 34,640
Other Expense 2,70,567 392,816
Total Expense 51,421,399 45,621,258
Profit for the year 7,191 41,979
Tax Expense:
Current tax 1,852 12,630
Deffered Tax Assets/Liabilities (798) (23,583)
Excess provision of tax for earlier year - -
Profits for the year 6,137 52,932
Earning per Equity Share of face value of ‘ 1 each
Basic (in rs.) 0.00 0.00
Diluted (in rs.) 0.00 0.00

2. Overall Performance & Outlook

The Gross Revenue of the Company Stood at Rs. 51,428,590 in Comparison to last years figure of Rs. 45,663,237 whereas Profit / (Loss) after Tax stood at Rs 6,137 in comparison to last Years Profit / (Loss) after Tax of Rs. 52,932.

3. Dividend on Equity Shares

To conserve resources for future and to meet its business requirements, Directors do not recommends any Dividend for the year under review.

4. Share Capital

The paid up Equity Share Capital as on March 31, 2018 was Rs.3, 62, 40,000. During the year under review, the Company has not issued shares with differential voting rights nor granted stock options nor sweat equity. As on March 31, 2018, none of the Directors and/or Key Managerial Person of the Company hold instruments convertible in to Equity Shares of the Company.

5. Directors:

During the financial year, three directors have resigned from the board of the company. Further, there was two appointment of director being carried out during the year.

Sr. No. Name Appointment / Resignation Designation Date of Appointment and Resignation
1 Mr. Rajesh Savadiya Appointment Independent Director 05.09.2017
2 Mr. Rajen Valia Appointment Independent Director 30.01.2018
3 Ms. Karishma Kaku Resignation Women Independent Director 28.06.2017
4 Mr. Jaydeep Matadia Resignation Independent Director 18.12.2017
5 Mr. Pawankumar Kapil Singh Resignation Independent Director 30.01.2018

As per provisions of Section 149 of the 2013 Act, independent directors shall hold office for a term up to five consecutive years on the board of a company, but shall be eligible for re-appointment for another term up to five years on passing of a special resolution by the company and disclosure of such appointment in Boards Report. Further Section 152 of the Act provides that the Independent Directors shall not be liable to retire by rotation in the Annual General Meeting (‘AGM) of the Company.

The Company has received necessary declaration from each independent director under Section 149(7) of the Companies Act, 2013 that he/she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of SEBI (Listing Obligation and Disclosure Requirements), 2015.

Further, none of the Directors of the Company are disqualified under sub-section (2) of Section 164 of the Companies Act, 2013.

The relevant details of the above Directors/KMP are given in the Corporate Governance Report

6. No. of Meetings of The Board:

During the year 7 (Seven) Board Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

7. Other Committees:

The composition of all the Committee Meetings and its meetings during the financial year 2017-18 forms part of the Corporate Governance Report.

8. Details of Significant and Material Orders Passed by the Regulators or Courts or Tribunals Impacting the going concern status and Companys Operations in Future

There is no significant and material orders passed by the Regulator/Courts that would impact the going concern status of the company and its operations.

9. Directors Responsibility Statement u/s 134 (5) of the Companies Act, 2013

Pursuant to the provisions of Section 134 (5) of Companies Act, 2013, as amended, with respect to the Directors Responsibility Statement, it is hereby confirmed that:

a) In the preparation of the annual accounts for the financial year ended 31st March,2018, the applicable Accounting Standards have been followed along with proper explanation relating to material departures, if any;

b) 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 31st March,2018 and of the profit and loss of the Company for the year ended 31st March,2018;

c) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) The Directors have prepared the annual accounts for the financial year ended 31st March, 2018 on a going concern basis;

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.

10. Deposits

The Company has no public deposits as of date and will not accept any deposits without prior approval of the Statutory Authorities concerned.

11. Statutory Auditors

At the 33rd Annual General Meeting (AGM) of the Company, the shareholders had approved appointment of M/s. Maheshwari & Co., Chartered Accountants (Firm Registration No. 105834W) as Statutory Auditors of the Company from the conclusion of 33rd AGM till the conclusion of 37th AGM, subject to ratification by the Shareholders at every AGM.

The Companies (Amendment) Act, 2017 published in the Gazette of India on January 3, 2018, amended few sections of the Companies Act, 2013 including omission of first proviso to Section 139(1) of the Companies Act, 2013 which provided for ratification of appointment of Statutory Auditors by members at every AGM.

The amendment to said Section is already effective from May 7, 2018. In view of the same, the fresh approval of the members is sought for the ratification of appointment of M/s. Maheshwari & Co, Chartered Accountants (Firm Registration No. 105834W), as Statutory Auditors of the Company, for the remaining term of three years i.e. from the conclusion of this 36th Annual General Meeting till the conclusion of the 37th Annual General Meeting of the Company.

The Board recommends the Ordinary Resolution set out at Item No.2 of the Notice for approval by the members. None of the Directors, Key Managerial Personnel or their respective relatives are concerned or interested, financially or otherwise, in this resolution

12. Risk Management

Pursuant to the requirement of Clause 49 of the Listing Agreement, the Company has constituted a Business Risk Management Committee. The details of Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Boards Report.

The Company has a robust Business Risk Management (BRM) framework to identify, evaluate business risks and opportunities. This framework seeks to create transparency, minimize adverse impact on the business objectives and enhance the Companys competitive advantage. The business risk framework defines the risk management approach across the enterprise at various levels including documentation and reporting. The framework has different risk models which help in identifying risks trend, exposure and potential impact analysis at a Company level as also separately for business segments viz. Finance and Capital Market activities.

13. Particulars of Loans, Guarantees or Investments by the Company

Details of Loans, Guarantees and Investments, if any, covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

14. Particulars of Contracts or Arrangements with Related Parties:

All transactions entered into with Related Parties as defined under the Companies Act, 2013 and Regulation 23 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 during the financial year, if any were in the ordinary course of business and on an arms length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013 thus disclosure in form AOC-2 is not required. There were no materially significant transactions with related parties during the financial year which were in conflict with the interest of the Company. Suitable disclosure as required by the Accounting Standards (AS18) has been made in the notes to the Financial Statements. The policy on Related Party Transactions as approved by the Board; is uploaded on the Companys website.

15. Details of Policy Developed and Implemented by the Company on its Corporate Social Responsibility Initiatives

The Company constantly strives to meet and exceed expectations in terms of the quality of its business and services. The Company commits itself to ethical and sustainable operation and development of all business activities according to responsible care and its own code of conduct. Corporate Social Responsibility is an integral part of the Companys philosophy and participates in activities in the area of education and health.

16. Policy on Directors Appointment and Remuneration Including Criteria for Determining

Qualifications, Positive Attributes, Independence of a Director, Key Managerial Personnel And other Employees

• The Non-Executive Directors shall be of high integrity with relevant expertise and experience so as to have a diverse Board with Directors having expertise in the fields of accounting, finance, taxation, law etc. However Women Director is exempted from said criteria.

• In case of appointment of Independent Directors, the N&R Committee shall satisfy itself with regard to the independent nature of the Directors vis--vis the Company so as to enable the Board to discharge its function and duties effectively.

• The N&R Committee shall ensure that the candidate identified for appointment as a Director is not disqualified for appointment under Section 164 of the Companies Act, 2013.

• The N&R Committee shall consider the following attributes/criteria, whilst recommending to the Board the candidature for appointment as Director

a. Qualification, expertise and experience of the Directors in their respective fields;

b. Personal, Professional or business standing;

c. Diversity of the Board.

• In case of re-appointment of Non-Executive Directors, the Board shall take into consideration the performance evaluation of the Director and his engagement level.

Remuneration

The Non-Executive Directors shall be entitled to receive remuneration by way of sitting fees, reimbursement of expenses for participation in the Board / Committee meetings. A Non-Executive Director shall be entitled to receive sitting fees for each meeting of the Board or Committee of the Board attended by him, of such sum as may be approved by the Board of Directors within the overall limits prescribed under the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. CEO & Managing director - Criteria for selection / appointment For the purpose of selection of the CEO & MD, the N&R Committee shall identify persons of integrity who possess relevant expertise, experience and leadership qualities required for the position and shall take into consideration recommendation, if any, received from any member of the Board. The Committee will also ensure that the incumbent fulfills such other criteria with regard to age and other qualifications as laid down under the Companies Act, 2013 or other applicable laws.

Remuneration for the CEO & Managing director

At the time of appointment or re-appointment, the CEO & Managing Director shall be paid such remuneration as may be mutually agreed between the Company (which includes the N&R Committee and the Board of Directors) and the CEO & Managing Director within the overall limits prescribed under the Companies Act, 2013.

17. Establishment of Vigil Mechanism/Whistle Blower policy

As required under Rule 7 of The Companies (Meetings of Board and its Powers) Rules 2014, the Company has a vigil mechanism named Fraud Risk Management Policy (FRM) to deal with instance of fraud and mismanagement, if any. The detail of the FRM Policy is explained in the Corporate Governance Report.

18. The Details in respect of adequacy of Internal Financial Controls

The Company has designed and implemented a process driven framework for Internal Financial Controls ("IFC") within the meaning of the explanation to Section 134 (5) (e) of the Companies Act, 2013.

For the year ended 31st March, 2018, the Board is of the opinion that the Company has sound IFC commensurate with the nature and size of its business operations; wherein controls are in place and operating effectively and no material weaknesses exist. The Company has a process in place to continuously monitor the existing controls and identify gaps, if any, and implement new and /or improved controls wherever the effect of such gaps would have a material effect on the Companys operation.

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit (IA) function is defined in the Internal Audit Charter. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.

The Internal Audit Department monitors and evaluates the efficiency and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

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

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment.

All employees (permanent, contractual, temporary, trainees) are covered under this policy. The following is a summary of sexual harassment complaints received and disposed off during each Calendar year:

• No. of complaints received: Nil

• No. of complaints disposed off: Nil

20. Extract of the Annual Return

The details forming part of the extract of the Annual Return in form MGT 9, as required under section 92 of the Companies Act, 2013 is annexed elsewhere in this Annual Report.

21. A Statement Indicating the Manner in which formal Annual Evaluation has been made by the board of its own Performance and that of its Committees and Individual Directors;

a) Nomination and Remuneration Committee of the Board had prepared and sent through its Chairman Draft parameterized feedback forms for evaluation of the Board, Independent Directors and Chairman.

b) Independent Directors at a meeting without anyone from the non-independent directors and management, considered/evaluated the Boards performance, performance of the Chairman and other non-independent Directors.

c) The Board subsequently evaluated performance of the Board, the Committees and Independent Directors.

22. The Details of Familiarization Programme arranged for Independent Directors have been disclosed on website of the Company and are available at the following link:

The Familiarization Programme for Independent Directors is hosted on the Companys Website at www.arihantmulticom.com

23. Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s A. L & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report is annexed elsewhere in this Annual Report.

24. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

Since the Company is into the Business of Financing and Investing activities in Shares and Securities; the information regarding conservation of energy, Technology Absorption, Adoption and innovation, under section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, is reported to be NIL.

25. Particulars of Employees

The information required pursuant to Section 197 read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees particulars which is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard.

26. Details of Subsidiary/Joint Ventures/Associate Companies

The Company does not have any Subsidiary, Joint venture or Associate Company.

27. Management Discussion and Analysis

The Management Discussion and Analysis Report forms part of the Annual Report and include various matters specified under Regulation 34(2) (e) of the SEBI (LODR) Regulations, 2015 form part of this Report.

28. Corporate Governance Report

A separate dedicated section under ‘Corporate Governance on the Companys website gives information on unclaimed dividends, quarterly compliance reports / communications with the Stock Exchanges and other relevant information of interest to the investors / public.

29. Acknowledgement:

The Board of Directors express their appreciation for the sincere co-operation and assistance of Government Authorities, Bankers, Customers, Suppliers, Business Associates and the efforts put in by all the employees of the Company. The Board of Directors expresses their gratitude to all our valued shareholders for their confidence and continued support to the Company.

Registered Office: By order of the Board
Arihant Multi Commercial For Arihant Multi Commercial Limited
Shah Arcade 1, Rani Sati Marg
Malad East, Mumbai-400 097. S/d
DEEPAK BANSAL
Chairman & Managing Director
(Din No: 03578201)
Date: - 29th May, 2018
Place: - Mumbai