arss infrastructure projects ltd share price Directors report


To,

The Members of

ARSS Infrastructure Projects Limited,

Presentation on the 23rd Annual Report highlighting the business and operations of the Company on a standalone and consolidated

basis and the audited financial statements for the financial year ended 31st March, 2023.

Pursuant to the Order dated 30th November, 2021 of the Honble National Company Law Tribunal, Cuttack ("NCLT Order"), Corporate Insolvency Resolution Process ("CIR Process") has been initiated against the Company in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016, ("Code") and related rules and regulations issued there under with effect from 30th November, 2021 (Corporate Insolvency Resolution Process Commencement Date). Mr. Uday Narayan Mitra (IBBI/IP A-001/IP-P00793/2017-18/11360) has been appointed as Interim Resolution Professional ("IRP") in terms of the NCLT Order. Subsequently COC has approved through e-voting dated 25.02.2022 as Resolution Professional ("RP") in conformity with sub section (2) of section 22 of the Insolvency and Bankruptcy Code, 2016.

The powers of Board of Directors of the Company stand suspended effective from the CIR Process commencement date and such powers along with the management of affairs of the Company are vested with the RP in accordance with the provisions of Section 17 and 23 of the Insolvency Code read with Regulation 15(2A) & (2B) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Resolution plan submitted by SRA i.e. Ocean Capital Market Limited which was approved by the COC with 76.67% votes which was not approved by Honble NCLT, Cuttack Bench, Cuttack and liquidation was initiated against the Corporate Debtor.

However the Resolution Applicant has filed an appeal with Honble NCLAT, New Delhi against the order rejecting the Resolution Plan. The Honble NCLAT passed an order dated 25th April, 2023, directing for liquidation shall remain stayed and resolution professional shall continue to manage the affairs of the company as a going concern.

The Application has been allowed by the Honble NCLAT, New Delhi vide its order dated 09-08-2023 by setting aside the order rejecting the resolution plan passed by the Honble NCLT, Cuttack bench vide its order dated 18.04.2023 and allowed the Resolution Applicant to prepare an addendum as per the said order.

In terms of Section 25 of the Code, the Company is continuing to operate as a going concern. Further, since the application for approval of the Resolution Plan is pending adjudication before the Tribunal after reconsidering by COC, the financial statements are being presented on a going concern basis.

A. Financial Highlights:

The financial highlights of the Company, on standalone and consolidated basis, for the financial year ended March 31, 2023

is summarized below:

(INR In Crores)

Standalone Co nsolidated
Particulars 2022-23 2021-22 2022-23 2021-22
Sales 402.52 288.81 402.52 288.81
Profit before Depreciation, Interest and Tax 8.93 (106.17) 8.92 (106.18)
Less : Depreciation 0.84 0.74 0.84 0.74
Interest 0.52 1.43 0.52 1.43
Share of net profit or associates and joint ventures accounted

using equity method

- - 0.52 0.39
Profit Before Tax 7.57 (108.34) 8.08 (107.96)
Less : Tax Expenses
a) Current Year - - - -
b) Earlier Year - - - -

Standalone Co nsolidated
Particulars 2022-23 2021-22 2022-23 2021-22
c) Deferred Tax 2.16 2.45 2.16 2.45
Profit/Loss After Tax 5.41 (110.78) 5.91 (110.41)
Balance brought forward from previous year (353.83) (243.05 (362.29) (251.88)
Add : Re-measurement of defined employee benefit plans

through OCI

- - - -
Amount Available for Appropriation (348.42) (353.83) (356.37) (362.29)
Appropriations
a) Dividend - - - -
b) Tax on Dividend - - - -
c) Transfer to General Reserve - - - -
Balance Carried to Balance Sheet (348.42) (353.83) (356.37) (362.29)
Earnings per Share (In INR) (Weighted) Basic (Equity Shares of face value of INR 10/- each) 2.38 (48.72) 2.60 (48.56)
Earnings per Share (In INR) (Weighted) Diluted (Equity Shares of face value of INR 10/- each) 2.38 (48.72) 2.60 (48.56)

Note: Previous years figures have been regrouped/re-classified, wherever required.

B. Subsidiary/ Associate & Joint Venture Company

(INR In Crores)

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Particulars

ARSS Damoh Hirapur Tolls Pvt. Ltd. (Subsidiary Company)

ARSS Developers Limited

(Associate Company)

2022-23 2021-22 2022-23 2021-22
Sales - - 0.31 0.12
Profit before Depreciation, Interest and Tax (0.02) (0.02) 0.05 (0.06)
Less : Depreciation - - 0.26 0.24
Interest - - 0.39 0.58
Profit Before Tax (0.02) (0.02) (0.60) (0.89)
Less : Tax Expenses
a) Current Year - - - -
b) Earlier Year - - - 0.001
c) Deferred Tax - - 0.005 0.02
Profit/Loss After Tax (0.02) (0.02) (0.06) (0.92)
Balance brought forward from previous year (0.02) - (30.53) (29.62)
Amount Available for Appropriation (0.04) (0.02) (30.53) (29.62)
Appropriations
a) Dividend - - - -
b) Tax on Dividend - - - -
c) Transfer to General Reserve - - - -
Balance Carried to Balance Sheet (0.04) (0.02) (31.14) (30.54)
Earnings per Share (In INR) (Weighted)

Basic (Equity Shares of face value of INR 10/- each)

(0.01) (0.01) (0.93) (1.42)
Earnings per Share (In INR) (Weighted)

Diluted (Equity Shares of face value of INR 10/- each)

(0.01) (0.01) (0.93) (1.42)

23rd Annual Report 2022-2023 005

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Indian Accounting Standards (Ind –AS)

As per the requirements of notification dated 16th February, 2015 issued by the Ministry of Corporate Affairs (MCA), Standalone and Consolidated Financial Statements of the Company for the Financial Year 2022-23 have been prepared as per Ind AS.

Dividend

Your Directors did not recommend any dividend for the financial year ended March 31, 2023.

State of Companys affairs and financial performance :

ARSS is renowned name in infrastructure sector in India. The Company is engaged into the construction services of Roads, Railways, Irrigation etc. though the Company is presently undergoing substantial financial stress and severe liquidity constraints. In spite of Company under CIRP, it has shown a remarkable growth and turnaround the loss into a profit of INR

7.57 cr. as compared to INR (-) 108.34 crores for the previous financial year with a remarkable growth of 106.98%. The turnover of the Company in the year is INR 402.52 crores as compared to INR 288.81 crores in the previous financial year with a remarkable growth of 39.37% in sales even during CIRP.

Details of Subsidiary, Joint Venture or Associates

Details of Subsidiary and Associate Companies

The Company has 1 subsidiary, 1 Associates and 15 Joint Ventures as on March 31, 2023. There has been no material change in the nature of the business of the subsidiaries. During the year under review no companies have become or ceased to be companys subsidiary, or associate companies or Joint Ventures (JVs). A report on the Companys subsidiary, joint ventures or associate companies as per Companies Act, 2013 is provided hereunder:

Sl.

No.

Name of the company

Address of the company

CIN/GLN/ PAN

Holding / subsidiary

/associate

% of shares held/ share

in JV

Applicable

section

1 ARSS Damoh- Hirapur Tolls Private limited Plot No-38, Sector-A, Zone-D, Mancheswar Industrial Estate, Bhubaneswar- 751010 U45201OR2011PTC013524 Subsidiary Company 99.82 % 2 (87)
2 ARSS

Developers Limited

Plot No-38, Sector-A, Zone-D, Mancheswar Industrial Estate, Bhubaneswar- 751010 U45209OR2007PLC009201 Associate Company 38.41% 2 (6)

Joint Venture (AOP)

Sl.

No.

Name of the company

Address of the company

CIN/GLN/ PAN

Holding / subsidiary

/associate

% of shares held/ share in JV
1 ARSS-ATLANTA JV. Plot No-38, Sector-A, Zone-D, Mancheswar Industrial Estate, Bhubaneswar- 751010 AAQFA8726P Joint Venture 51.00%
2 HCIL-ADHIKARYA- ARSS JV Plot No-38, Sector-A, Zone-D, Mancheswar Industrial Estate, Bhubaneswar- 751010 AAEFH3757R Joint Venture 30.00%
3 ARSS - SIPS (JV) 129, Transport Centre, Rohtak Road, Punjabi Bagh, New Delhi – 110 035 AAEAA3620K Joint Venture 51.00%
4 ARSS - SCPL (JV) Plot No-38, Sector-A, Zone-D, Mancheswar Industrial Estate, Bhubaneswar- 751010 AAEAA3621J Joint Venture 51.00%
5 ARSS - BMS (JV) Plot No-38, Sector-A, Zone-D, Mancheswar Industrial Estate, Bhubaneswar- 751010 AAEAA4835G Joint Venture 51.00%

Sl.

No.

Name of the company

Address of the company

CIN/GLN/ PAN

Holding / subsidiary

/associate

% of shares held/ share in JV
6 ARSS- TECHNOCOM- PRIYASHI ASHI JV. Kamrup Chamber road,

Fancy Bazar,Guwahati-781001- Assam

AAHAA8492L Joint Venture 51.00%
7 ARSS-SNKI JV Plot No-38, Sector-A, Zone-D, Mancheswar Industrial Estate, Bhubaneswar- 751010 AAEAA8546Q Joint Venture 51.00%
8 ARSS-THAKUR JV. Plot No-38, Sector-A, Zone-D, Mancheswar Industrial Estate, Bhubaneswar- 751010 AAJAA0912F Joint Venture 80.00%
9 ARSS – ROYAL (JV) Plot No. 38, Sector-A, Zone-D, Mancheswar Industrial Estate, Bhubaneswar, Odisha, 751010 AAJAA1996R Joint Venture 75.00%
10 ARSS-BDPL (JV) Plot No-38, Sector-A, Zone-D, Mancheswar Industrial Estate, Bhubaneswar- 751010 AAJAA6181C Joint Venture 51.00%
11 ARSS - NTLLP (JV) Short- Cut, P.O.- Nirjuli, Dist- Papumpare, Pin- 791109, Arunachal Pradesh. AAJAA9902B Joint Venture 51.00%
12 SCPL - ARSS (JV) OU-522, 5th Floor, Esplanade Commercial Development, Unit No. 32, 721, Rasulgarh,

Bhubaneswar -751010

ABLAS3263J Joint Venture 20.00%
13 ARSS - KKMPL (JV) Plot No-38, Sector-A, Zone-D, Mancheswar Industrial Estate, Bhubaneswar- 751010 AAHAA8368B Joint Venture 49.00%
14 ATLANTA-ARSS (JV) 504, Samarpan, New Link Road, Chakala, Near Mirador Hotel, Andheri East, Mumbai – 400 099 AABAA0048E Joint Venture 49.00%
15 ARSS-LGPPL (JV) Plot No-38, Sector-A, Zone-D, Mancheswar Industrial Estate, Bhubaneswar- 751010 AAGAA3633G Joint Venture 51.00%

The name of the Joint Venture which have become JV during the year : NIL

The name of the Joint Venture which has been inoperative during the year under review: NIL

Consolidated Financial Statements:

The RP reviewed the affairs of the Companys subsidiary during the year at regular intervals. Consolidated financial statements (consolidating financials of ARSS Damoh - Hirapur Tolls Private Limited being its subsidiary company and of ARSS Developers Limited being its associate company) in terms of Section 129 (3) of the Companies Act, 2013 read with rule 6 of Companies (Accounts) Rules, 2014 and under Regulation 33 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as "SEBI Listing Regulations") and as per requirements of Ind AS 110 – consolidated financial statements read with Ind AS 28- Investment in associates and Joint ventures and Ind AS 31 – interest in Joint ventures, the Audited Consolidated Financial Statements are provided in this Annual Report. The consolidated Financial Statements have been prepared on the basis of audited financial statements of the Company and its subsidiary, as approved by the RP.

Pursuant to the Section 129 (3) of the Companies Act, 2013 read with rule 5 of Companies (Accounts) Rules, 2014, a statement containing the salient features of the financials statements of each of the subsidiary and associate company in the prescribed form AOC-1 is annexed to this annual report.

Pursuant to the Section 136 of the Companies Act, 2013 financial statements of subsidiary/ associate companies are kept for inspection by the shareholders at the Registered Office of the Company. The said financial statements of the subsidiaries are also available on the website of the Company www.arssgroup.in under the Investor Relations Section.

Reserve

No amount was proposed to be transferred to general reserve.

Operations- Work Orders

Your Directors are pleased to inform that during the year under report, the Company has secured the following contracts (work order):

1. At Paradip: Temporary Rail connectivity to MMLP Paradip which is awarded in favour of your company by Dy. General Manager /Engg., Container Corporation of India Limited, New Delhi on 6th April, 2022 with a Contract Value of INR 2.20 Crores

Performance and financial position of each of the subsidiaries and associates companies are included in the consolidated

financial statement.

CREDIT Rating

The accounts of the Company is NPA since 2012, therefore no rating has been assigned to the Company.

Listing with stock exchanges

The Company confirms that it has paid the Annual Listing Fees for the financial year 2023-2024 to The Bombay Stock

Exchange Limited and National Stock Exchange of India Limited where the Companys Shares are listed.

Management Discussion and Analysis Report:

As required under regulation 34 SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Management Discussion and Analysis Report is enclosed as a part of this report as ‘Annexure – A.

Corporate Governance and Shareholders Information:

The Company is committed to maintaining high standards of Corporate Governance and adheres to the Corporate Governance requirements set out by the Securities and Exchange Board of India (SEBI). The Company continues to lay a strong emphasis on transparency, accountability and integrity and has also implemented several corporate governance practices in this regard. A separate report on Corporate Governance in terms of Regulation 34(3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘the Listing Regulations) is provided in this Annual Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance along-with a declaration signed by Resolution Professional stating that the members of the Board of Directors and Senior Management Personnel have affirmed compliance with the respective codes of conduct of the Board of Directors and Senior Management is attached to the report on Corporate Governance. A report on Corporate Governance is included as a part of this Annual Report as ‘Annexure – B.

A company undergoing insolvency resolution process, however, is exempted from the requirement of, amongst others, composition of board of directors, constitution, meetings and terms of reference of the audit committee, constitution, meetings and terms of reference of the nomination and remuneration committee, constitution, meetings and terms of reference of the stakeholders relationship committee as required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Annual Return

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on 31st March, 2023 is hosted on the Companys website i.e. http://arssgroup.in/PDF/AnnualReturn/2023/ARSS_ANNUAL_RETURN_2023.pdf

Board Committees

The Board of Directors of your Company had already constituted various Committees in compliance with the provisions of the Companies Act, 2013 and SEBI Listing Regulations viz. Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee and CSR Committee.

During financial year 2014-15, in accordance with the provisions of the erstwhile Clause 49 of the Listing Agreement, the

Board had voluntarily constituted the Risk Management Committee.

All decisions pertaining to the constitution of Committees, appointment of members and fixing of terms of reference / role

of the Committees are taken by the Board of Directors.

Details of the role and composition of these Committees, including the number of meetings held during the financial year

and attendance at these meetings, are provided in the Corporate Governance Section of the Annual Report.

However the Financial Creditors, State Bank of India has filed a petition bearing CP (IB) No. 34/CB/2021 under section 7 of Insolvency and Bankruptcy Code, 2016 ("IBC"), before the National Company Law Tribunal – Cuttack Bench ("NCLT, Cuttack") and subsequently the corporate insolvency resolution process (CIRP) has been initiated against the company by the NCLT Cuttack Bench, Cuttack vide order dated 30th November, 2021. vide this order Mr. Uday Narayan Mitra (Reg. No. IBBI/IPA001/IP-P00793/2017-18/11360) having address at 72/1, Dawnagazi Road, Bally, Kolkata, West Bengal -711201 (Email- udaynarayanmitra@yahoo.co.uk) has been appointed as Interim Resolution Professional (IRP) and accordingly the power of the Board and committees thereof are suspended and vested in the RP w.e.f. 30.11.2021 and he is performing the functions as mentioned under Insolvency and Bankruptcy Code, 2016 (the IBC Code).

Number of Board Meetings:

The powers of the Board of Directors remained suspended during CIRP period from 30.11.2021 onwards and no Board/ Committee meetings were held during the Financial Year 2022-23. The powers of board of directors were being exercised by the Resolution Professional (RP) in accordance with Sections 17 and 23 of the Insolvency Code. Further details are given in the Corporate Governance Report.

Committees of the Board of Directors

The Board had five committees namely, the Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Corporate Social Responsibility Committee, Operation and Management Committee prior to CIRP period. The Board had a defined set of guidelines, duties and responsibilities and an established framework commensurate with the applicable provisions of the Companies Act, 2013 and Listing Regulations for conducting the meetings of the said Committees. A detailed note on the Board of Directors and its committees, their scope etc. is provided under the Corporate Governance Report section of this Annual Report. The powers of board of directors and its committees remained suspended during period under review and were being exercised by the RP in accordance with Sections 17 and 23 of the Insolvency Code. Accordingly, no meetings of the Committees were held during the Financial Year 2022-23. Further details are given in the Corporate Governance Report.

Audit Committee

The Company has in place an Audit Committee in terms of the requirements of the Companies Act, 2013 read with the rules made there under and Regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The details relating to the same are given in ‘Annexure B of the Board Report on the Corporate Governance forming part of this report. Members are requested to refer to point No. 6 of Corporate Governance Report attached with this annual report.

Nomination and Remuneration Committee

The Company has in place Nomination and Remuneration Committee in terms of the requirements of the Companies Act, 2013 read with the rules made thereunder and Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The details relating to the same are given in ‘Annexure B of the Board Report on the Corporate Governance forming part of this report. Members are requested to refer to point No. 7 of Corporate Governance Report attached with this annual report.

Corporate Social Responsibility Committee (CSR):

The company has in place Corporate Social Responsibility Committee (CSR) in terms of the requirements of section 135 and Schedule VII of the Companies Act, 2013. The details relating to the same are given in ‘Annexure B of the Board Report on the Corporate Governance forming part of this report. Members are requested to refer to point No. 8 of Corporate Governance Report attached with this annual report.

Shareholders Relationship Committee

The company has in place Shareholders Relationship Committee in terms of the requirements of the Companies Act, 2013 read with the rules made thereunder and Regulation 20 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The details relating to the same are given in ‘Annexure B of the Board Report on the Corporate Governance forming part of this report. Members are requested to refer to point No. 9 of Corporate Governance Report attached with this annual report.

23rd Annual Report 2022-2023 009

Dematerialization of shares:

Physical/ NSDL/ CDSL/Summary Report as on 31st March, 2023, representing 99.94% of total Equity Share Capital of the Company were held in dematerialized form. The Companys Registrars is Bigshare Services Private Limited, Office No. S6-2, 6th Floor, Pinnacle Business Park, Next to Ahura Centre, Mahakali Caves Road, Andheri (East) Mumbai 400093, Maharashtra, India.

Particulars No. of Shareholders Percentage (%age) No. of Shares Percentage (%age)
CDSL 8,432 52.05% 1,39,98,227 61.56%
NSDL 7,760 47.90% 87,27,012 38.38%
PHYSICAL 8 0.05% 12,727 0.06%
TOTAL 16,200 100.00% 2,27,37,966 100.00%

E-voting facility at AGM

In terms of Regulation 44 of SEBI Listing Regulations and in compliance with the provisions of Section 108 of the Act read with Rule 20 and other applicable provisions of the Companies (Management and Administration) Rules, 2014 (as amended), the items of business specified in the Notice convening the 23rd AGM of the Company shall be transacted through electronic voting system only and for this purpose the Company is providing e-Voting facility to its Members whose names will appear in the register of members as on the cut-off date (fixed for the purpose), for exercising their right to vote by electronic means through the e-Voting platform to be provided by National Securities Depository Ltd ("NSDL"). The detailed process and guidelines for e-voting have been provided in the notice convening the meeting.

Public deposits, covered under Chapter V of the Act

Your Company has not invited any deposit from public and shareholders. So, the provisions of the Chapter V of the Companies Act, 2013 are not attracted.

Auditors: Statutory Auditors:

At the Nineteenth AGM held on September 25, 2019 the Members approved appointment of M/s. A R M S & Associates, Chartered Accountant (Firms Registration No. 013019N) of Gurugram as Statutory Auditors of the Company to hold office for a period of five years from the conclusion of that AGM till the conclusion of the twenty-forth AGM.

Cost Auditors:

As per the requirements of the Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014 as amended from time to time, your Company is required to maintain cost records and accordingly, such accounts are made and records have been maintained every year. The Cost Audit for the financial year 2022-2023 was completed and the report submitted by the cost auditor has been duly taken on record by the resolution professional.

During the year under review, M/s. MAK & Co., Cost Accountants, Bhubaneswar (Firm Registration Number 004499) has resigned due to his pre occupation. The Resolution Professional has appointed M/s. I C Kundu & Co, Cost Accountants, FRN 700778 as Cost Auditor to audit the cost records of the Company for the financial year 2022-23 to fill the casual vacancy created on resignation of earlier cost auditor. Resolution Professional also appointed M/s. I C Kundu & Co, Cost Accountants, FRN 700778 as Cost Auditor to audit the cost records of the Company for the financial year 2023-24. The Cost Auditors have submitted a certificate of their eligibility for such appointment and confirmed that their appointment is within the limits of section 141(3)(g) of the Companies Act, 2013 and have also certified that they are free from any disqualifications specified under section 141(3) and proviso to section 148(3) read with section 141(4) of the Companies Act, 2013.

As required under the Companies Act, 2013, the remuneration payable to the cost auditor is required to be placed before the Members in a General Meeting for their ratification. Accordingly, a Resolution seeking Members ratification for the remuneration payable for FY 2022-23 and 2023-24 to M/s. I C Kundu & Co, as Cost Auditor, Bhubaneswar (Firm Registration Number 100778), is included in the Notice convening the Annual General Meeting.

010 ARSS INFRASTRUCTURE PROJECTS LIMITED

Cost Records

Company has maintained proper cost records and books of account pursuant to the Rules made by the Central Government for the maintenance of cost records under sub-section (1) of Section 148 of the Act in respect of Companys products/ services.

Secretarial Auditors:

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 Sunita Jyotirmoy & Associates., a firm of practicing Company Secretaries, Bhubaneswar to undertake the Secretarial Audit of the Company. The Secretarial Audit Reports for the financial year 2022-23 of the Company and its material subsidiary company i.e. ARSS Damoh Hirapur Tolls Private Limited are annexed herewith as ‘Annexure – C & D. There were no qualifications, observations, reservation or comments or other remarks in the Secretarial Audit Reports, which have any adverse effect on the functioning of the Company and its material subsidiary.

Annual Secretarial Compliance Report

The Company has undertaken an audit for the Financial Year 2022-2023 for all applicable compliances as per Securities and Exchange Board of India Regulations and Circulars/Guidelines issued thereunder. The Annual Secretarial Compliance Report duly signed by CS Jyotirmoy Mishra Partner of M/s Sunita Jyotirmoy & Associates has been submitted to the Stock Exchanges.

Internal Auditors:

The Internal Auditors, M/s. PR & Associates, Cost Accountants, Bhubaneswar conduct internal audits periodically and submit their reports to the Resolution Professional and he has reviewed the report from time to time. For Financial Year 2023-24, M/s. PR & Associates, Cost Accountants, Bhubaneswar has been appointed as Internal Auditors of the Company by the Resolution Professional pursuant to the Section 138 of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014.

Reporting of Frauds by Auditors

During the year under review, the Statutory Auditors, Cost Auditors and Secretarial Auditor have not reported any instances of frauds committed in the Company by its Officers or Employees to the Audit Committee under section 143(12) of the Companies Act, 2013.

Report of Auditors:

Statutory Auditors

Our reply to the qualifications of Auditors: -

Basis for Qualified Opinion on standalone Financial Statements

a) In absence of relevant records, Contract-wise surplus/loss has neither been ascertained nor recognized in compliance with Ind AS-115 ‘Revenue from contract with customers.

Company Reply: During the work execution period there is escalation claim, revision of contact value, extension of completion period, etc. due to which unpredictable variation in reliable estimation of revenue and cost. Also the allocation of combine Operating overhead, Head office overhead and Financial Cost is not possible due to combine use or high swapping of resources, size of the Contracts. Hence financial implication of the qualification is not quantifiable.

Basis for Qualified Opinion on Consolidated Financial Statements

In absence of relevant records, Contract-wise surplus/loss of holding company has neither been ascertained nor recognized in compliance with Ind AS-115 ‘Revenue from contract with customers.

Company Reply: During the work execution period there is escalation claim, revision of contact value, extension of completion period, etc. due to which unpredictable variation in reliable estimation of revenue and cost. Also the allocation of combine Operating overhead, Head office overhead and Financial Cost is not possible due to combine use or high swapping of resources, size of the Contracts. Hence financial implication of the qualification is not quantifiable.

23rd Annual Report 2022-2023 011

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In the absence of audited books of accounts of ARSS-SIPS JV, ARSS Technocom Priyashi Aashi JV and ARSS-BMS JV, ARSS-KKMPL JV and ARSS NTLLP JV, financial data from these entity have not been included in consolidation of financial statement.

Company Reply: The accounts of the JVs are under the control of respective JV Partners i.e. Shyam Indus Power Solutions Pvt. Ltd, BMS Projects, M/s. Technocom, NTLLP and K K Minerals Private Limited. The accounts of these JVs are yet to be finalized from their end. Hence financial implication for the JV is not quantifiable. However the accounting effect of the discrepancies, if any after the finalization of its accounts will be given at current date.

Directors and Key Managerial Personnel

The Honble NCLT vide order dated November 30, 2021 had initiated the CIRP Proceedings against the Company and pursuant to Section 17 of the IBC, the powers of the Board of Directors of the Company stood suspended, and such powers are vested with the Resolution Professional, Mr. Uday Narayan Mitra.

The outcome of the CIRP may result in change in the Board of Directors of the Company followed by reconstitution of the statutory committees of the Board of Directors of the Company. In accordance with the provisions of the Act and the Articles of Association of the Company, Shri Subash Agarwal, Director (Chairman) of the Company, retire by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment, However, his Power as director shall stand suspended during CIRP.

During the year, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board/ Committee of the Company.

Key Managerial Personnel

Following persons are the Key Managerial Personnel of the Company pursuant to Section 2(51) and Section 203 of the Act, read with the Rules framed thereunder:

Mr. Rajesh Agarwal, Managing Director; (suspended during CIRP w.e.f. 30.11.2021)

Mr. Uday Narayan Mitra, Resolution Professional (appointed by NCLT w.e.f. 30.11.2021)

Mr. S. K. Pattanaik, Chief Financial Officer and

Mr. Prakash Chhajer, Company Secretary & Compliance officer

Declaration given by independent directors under sub-section (6) of section 149;

Since the company is under CIRP, the Board of directors is suspended w.e.f. 30.11.2021 therefore no such declaration has been received from Independent director.

In view of above the statement regarding opinion of the Board with regard to integrity, expertise and experience (including

the proficiency) of the independent directors during the financial year is not provided.

Secretarial Standards

Pursuant to the provisions of Section 118 of the Companies Act, 2013, the Company has complied with the applicable provisions of the Secretarial Standards issued by the Institute of Company Secretaries of India and notified by Ministry of Corporate Affairs.

Directors Responsibility Statement/ Statement by the Chief Financial Officer (CFO) and taken on record by the

Resolution Professional:

To the best of their knowledge and belief and according to the information and explanations obtained by them/CFO of the Company, your Directors and CFO make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013 that:-

in the preparation of the annual accounts for the financial year ended March 31, 2023, the applicable accounting standards read with requirements set out under Schedule III of the Companies Act, 2013 have been followed and there are no material departures from the same;

012 ARSS INFRASTRUCTURE PROJECTS LIMITED

the directors/ CFO 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;

the directors/ CFO had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

the directors/ CFO had prepared the annual accounts on a going concern basis;

the directors/ CFO had laid down internal financial controls and such internal financial controls are adequate and are

operating effectively; and

the directors/ CFO had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Code of Conduct

The Code of Conduct (hereinafter referred to as ‘Code) is applicable to all its Board Members and Senior Management Personnel of the Company. A Code of Conduct for the Directors and Senior Management Personnel has already been approved by the Resolution professional of the Company. All Board Members and Senior Management Personnel had affirmed compliance with the Code during the year and no violation of the same was reported. A declaration to the effect that all Board Members and Senior Management Personnel have complied with the Code during the financial year 2022-2023, duly signed by Resolution professional of the Company is herein below enclosed with Corporate Governance Report. The Code has also been posted on the Companys Web-site.

Particulars of employees (rule 5(2), and 5(3)) and managerial remuneration ( rule 5(1) ) of the companies (appointment and remuneration of managerial personnel) rules, 2014 , and under section 197(12) of the act

The total number of employees as on 31st March, 2023 stood at 573.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1), 5(2) and 5 (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are provided as follows:

The percentage increase in remuneration of each director, Chief Financial Officer, Company Secretary during the financial year 2022-2023 and ratio of the remuneration of each director to the median remuneration of the employees of the company for the financial year 2022-2023 are as under;

Sr.

No.

Name of the Director/ KMP and designation

Remuneration of Director/ KMP for the FY 2022-23

(INR in Lacs)

% increase in remuneration

in the FY 2022-23

Ratio of remuneration of each Director/ to median remuneration of

employees

1 Mr. Subash Agarwal, Chairman (suspended during CIRP) Nil Nil Nil
2 Mr. Rajesh Agarwal, Managing Director (suspended during CIRP) Nil Nil Nil
3 Mr. S. K. Pattanaik, Chief Financial officer 30.00 Nil Not Applicable
4 Mr. Prakash Chhajer,

Company Secretary & Compliance Officer

16.50 Nil Not Applicable

The median remuneration of employees of the company during the financial year was INR 1,68,000;

In the Financial year, there was decrease of (-) 5.72% in the median remuneration of employees;

There were 573 permanent employees on the rolls of Company as on March 31, 2023

23rd Annual Report 2022-2023 013

During the financial year 2022-2023, the average percentage decrease in salary of the Companys employee, excluding the key managerial Personnel (‘KMP) was 1.68%. and there was no change in the salary of KMPs during the year under review. and

It is hereby affirmed that the remuneration paid is as per the Remuneration Policy for Directors, Key Managerial

Personnel and other Employee.

THE INFORMATION REQUIRED UNDER SECTION 197 OF THE ACT READ WITH RULE 5(2) & (3) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014 ARE GIVEN BELOW:

Sl.

No.

Name Age In Years Qualification Date of Comencement of Employment Designation Remuneration (Amount in INR) Total Experience (No. of yrs.) Previous Employment (Designation) Percentage of equity share held by employee in company
1 Mr. S .K. Pattanaik 51 M.Com, LLB, PGDM 01.04.2015 CFO 30,00,000 20 ARSS I.P.L. DF 0.00005
2 Mr. K.P. Verma 54 BE-CIVIL 01.04.2016 Project Director 21,60,000 24 Aravali Infra Power Ltd. - Project Manager -
3 Mr. Sanjay Peshion 54 B.TECH.-CIVIL 01.05.2016 VP 18,00,000 29 Harishchandra India Ltd.

– Additional GM

-
4 Mr. Rashmi Ranjan Singh 49 CA 01.08.2007 AVP-Finance & Accounts 16,80,000 17 ARSS I.P.L. - Financial Advisor -
5 Mr. Prakash Chhajer 41 CS 28.05.2019 Company Secretary 16,50,000 13 Scan Energy & Power Limited -
6 Mr. Ramesh Kumar Ranjan 49 Bachelor of Eng. Civil 01.04.2005 Project Manager- Mizoram 16,20,000 17 Triveni Engicon, Jamshedpur, Sr Engg. -
7 Mr. Kedar Gouri Padhy 46 DCE, B Tech Civil 08.11.2017 Project Manager 15,00,000 17 Reliance Industries Ltd. – Senior Manager -
8 Mr. Surendra Kumar Khare 57 B.Tech Civil 15.03.2012 Vice President 13,20,000 32 - -
9 Mr. Amarkant Pathak 47 BA 20.10.1996 Site In Charge 12,00,000 25 - -
10 Mr Parag Purkait 37 Diploma 09.10.2021 Project Manager 12,00,000 14 Lea Associates -

Companys policy on directors appointment and remuneration including criteria for determining qualifications,

positive attributes, independence of a director and other matters provided under sub-section (3) of section 178;

The Company has a policy for remuneration of Directors, Key Managerial Personnel and Senior Management Personnel as well as well-defined criteria for the selection of candidates for appointment to the said positions which has been approved by the Board. The Policy broadly lays down the guiding principles for determining qualifications, positive attributes, independence of a Director and other matters provided under sub-section (3) of section 178 of Companies Act, 2013.

During the year under review, no changes were made in the above policy. Salient features of this policy are enumerated in the Corporate Governance Report which forms part of the Annual Report. The above policy is available at the website of the Company at http://arssgroup.in/ArssPolicies.html

Industrial Relation:

Employee relations continued to be cordial throughout the year. The whole-hearted support of employees and a sense of belongingness with the organization and solidarity with the management of the Company have helped to cope with the present challenges of the Company during the year.

Adequacy of internal financial controls with reference to the Financial Statements. –

Management has put in place effective Internal Control Systems to provide reasonable assurance for:

Safeguarding Assets and their usage.

Maintenance of Proper Accounting Records and

Adequacy and Reliability of the information used for carrying on Business Operations.

Key elements of the Internal Control Systems has been provided & explained in MDA report attached with Directors Report.

014 ARSS INFRASTRUCTURE PROJECTS LIMITED

Annual Evaluation by the Board of Its Own Performance (Including Committees and Individual Directors)

In terms of SEBI (Listing Obligations and Disclosure Requirements) (Third Amendment) Regulations, 2018, a company undergoing CIR process is not required to comply with the requirement of conducting evaluation of the independent directors. Therefore, subsequent to commencement of the CIR process the evaluation of the independent directors of the Company was not required to be carried out under the provisions of the Regulation 17(10) SEBI LODR Regulations. Further, in accordance with Rule 8(4) of Companies (Accounts) Rules, 2014, the board of directors of a company are required to evaluate its own performance and that of its committees and individual directors. However pursuant to commencement of the CIR process of the Company, the powers of the board of directors stand suspended and the affairs of the Company were being conducted by RP during Financial Year under review. Consequently, no meeting of the Directors was held during the Financial Year 2022-23 for such evaluation.

Segment wise performance:

The Company is engaged in only one segment viz. Construction Business and as such there is no separate reportable segments as per IND AS -108 "Operating Segment."

Independent Directors Meeting

Since the CIRP has been initiated and the board has been suspended w.e.f. 30.11.2021 therefore no meeting of the Independent Directors was held during the year under review.

Familiarisation Programme of Independent Directors

In compliance with the requirements of SEBI Listing Regulations, the Company has put in place a familiarization program for Independent Directors to familiarize them with their role, rights and responsibility as Directors, the operations of the Company, business overview etc. The details of the familiarization program are explained in the Corporate Governance Report and the same is also available on the website of the Company. During the year under, the company is under CIRP no such familiarization program was conducted for Independent directors.

Details of significant and material orders:

During the year under review one significant and material order passed by the regulators or courts or tribunals impacting the going concern status and companys operations in future. However subsequently the order was stayed by Appellate Tribunal -

The Resolution plan submitted by Successful Resolution Applicant (SRA) i.e. Ocean Capital Market Limited which was approved by the COC with 76.67% votes has been rejected by Honble NCLT, Cuttack Bench, Cuttack and liquidation has been initiated against the Corporate Debtor vides its order dated 18.04.2023. Ms. Payal Agarwal Insolvency Resolution Professional has been appointed as liquidator of the company. However the Resolution Applicant has filed an appeal with Honble NCLAT, New Delhi against the order rejecting the Resolution Plan. The Honble NCLAT passed an order dated 25th April, 2023, directing for liquidation shall remain stayed and resolution professional shall continue to manage the affairs of the company as a going concern.

The Application has been allowed by the Honble NCLAT, New Delhi vide its order dated 09-08-2023 by setting aside the order rejecting the resolution plan passed by the Honble NCLT, Cuttack bench vide its order dated 18.04.2023 and allowed the Resolution Applicant to prepare an addendum as per the said order.

The SEBI vide its Order no WTM/AB/IVD/ID19/47675/2021-22 dated 25.11.2021 has debarred to the Company and executive director/KMP (Mr. Subash Agarwal, Mr. Rajesh Agarwal and Mr. S. K. Pattanaik) from accessing the securities market and further prohibited from buying, selling or otherwise dealing in securities, directly or indirectly, or being associated with the securities market in any manner, whatsoever, for a period of one year, from the date of coming into force of this order i.e. 25.11.2021; and Non executive director were restrained for six months. The SEBI also levied the penalty to the Company INR 25 lacs, to the executive directors INR 7.50 lacs each, to S. K. Pattanaik (CFO) INR 3 lacs and to non executive directors INR 1.50 lacs each.

However the Directors and KMP has filed an appeal with Honble Securities Appellate Tribunal (SAT) by depositing the equivalent amount of fine and a stay order was passed by Honble SAT against SEBI order.

At the final hearing Honble SAT has passed an order for partially allowing the appeals by waiver of fine imposed on Independent Directors and reducing fine imposed on Mr. Subash Agarwal and Mr. Rajesh Agarwal from INR 7.5 Lacs to INR 4 Lacs each and Mr. S. K. Pattanaik CFO from INR 3 Lacs to INR 1 Lac.

Further the Company is under moratorium period, no adverse action taken by SEBI against the company.

Particulars of Loans, Guarantees or Investments under Section 186

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

Particulars of Contracts or Arrangements with Related Parties Referred To In Sub-Section (1) of Section 188 in the Prescribed Form AOC-2

All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in its

ordinary course of business and on an arms length basis. During the year, the Company had not entered into any contract

/ arrangement / transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions.

The Policy on Materiality of Related Party Transactions and on dealing with Related Party Transactions as approved by the Board is put up on the Companys website and can be accessed at

http://arssgroup.in/PDF/ArssPolicy/Related%2 Party%20Transaction%20Policy.pdf

All related party transactions are in compliance with Ind-AS 24, Section 188 and / or SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and are placed before the Audit Committee as also before the Board for approval. Prior omnibus approval of the Audit Committee was also sought for transactions which are of a foreseen and repetitive nature.

There were no materially significant related party transactions which could have potential conflict with interest of the

Company at large.

Members may refer Note 61 to the Standalone Financial Statement which sets out related party disclosures pursuant to Ind AS 24.

The particulars of contracts entered into with related parties during the year as per Form AOC-2 is enclosed as ‘Annexure-E.

Material changes and commitments, affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report:

There have been no material changes and commitments affecting the financial position of the company between the end of the financial year and date of this report except the Honble NCLT/NCLAT order(s) related to matters under CIRP.

Compounding status

The Company has received show cause notices by the office of Regional Director, Eastern Region and Registrar of Companies of Odisha at Cuttack. Pursuant to the inspection held under section 209(A) of The Companies Act, 1956 in the year 2016-17 for the non compliance of few section of the Companies Act. The Company has already compounded 13 sections out of total Forty Four sections for which show cause notices were issued. Rest are under the process and will be compounded in due course.

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

During the year under review, the Company has taken adequate measures for conservation of energy and also has not gone for any technology absorption whatsoever in accordance with the provisions of sub - Section (3) (m) section 134 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014. The Company has neither earned any income nor incurred any expenditure in foreign currency during the financial year ended 31st March, 2023.

Business risk management

Pursuant to the provisions of Regulation 21 of the Listing Regulations, the Company is not required to constitute a Risk Management Committee. The Company has however laid down procedures to inform Board members about the risk assessment and minimization procedures. The Companys management systems, organizational structures, processes, standards, code of conduct, Internal Control and Internal audit methodologies and processes that governs as to how the Company conducts its business and manages associated risks. The Company also has in place a Risk Management Policy to identify and assess the key risk areas. The Members of the Audit Committee monitors and reviews the implementation of various aspects of the Risk Management Policy. Major risks identified by the Company are systematically addressed through mitigating actions on a continuous basis. The Company has also adopted Risk Assessment, Minimization and Control Procedures.

Pursuant to commencement of the CIR Process, the powers of the Board of Directors stand suspended and are exercised by the interim resolution professional or resolution professional, as the case may be, in accordance with the provisions of the Code. Accordingly, the Board as well as the Audit Committee has not met during the year under review. At present the company is under CIRP therefore the related risk is associated with the company.

Corporate Social Responsibility

Terms of reference:

The Committee formulates CSR Policy. The role of the Committee is as under:

Formulate and recommend to the Board, a Corporate Social Responsibility Policy which shall indicate the

activities to be undertaken by the Company as specified in Schedule VII of the Companies Act, 2013.

Recommend the amount of expenditure to be incurred on the activities referred in the CSR policy.

Monitor the CSR Policy of the Company and its implementation from time to time.

Such other functions as the Board may deem fit from time to time.

Composition, name of Members and attendance during the year:

The CSR Committee of the Company consists of 1 Non-Executive Independent Directors and 1 Executive Director.

Name of the member

Position

No. Of Meetings held during

the FY 2022-23

No. of meetings Attended during the FY 2022-23
Mr. Rajesh Agarwal Chairman Nil Nil
Mr. Pareswar Panda Member Nil Nil

w.e.f. from 30.11.2021 the committee was suspended due to CIRP

No. of Meetings held during the year:

Since the Board and committee thereof has been suspended during CIRP, hence no meeting was held during the year under review.

Amount incurred on CSR activities during the year:

Section 135 of the Companies Act, 2013 & Companies (Corporate Social Responsibility Policy) Rules, 2014, (CSR Rules) makes it mandatory for certain companies who fulfill the criteria as mentioned under Sub Section 1 of Section 135 to comply with the provisions of Corporate Social Responsibility and accordingly the Company had constituted a CSR committee and has also adopted the CSR Policy for the company as approved by the committee.

Since the average of the last three years profit was in negative figures i.e. (INR 50.81) crores loss,the Company need

not to incur any amount towards CSR in the FY 2022-23.


A responsibility statement of the CSR Committee

The CSR Committee has confirmed that the implementation and monitoring of CSR Policy, is in compliance with CSR

objectives and Policy of the Company.

Vigil Mechanism/ Whistle Blower Policy of the Company

Sd/-


Rajesh Agarwal (Chairman CSR Committee) (Suspended During CIRP)

The Vigil Mechanism as envisaged in the Companies Act, 2013, the Rules prescribed thereunder and the Listing Regulations is implemented through the Companys Whistle Blower Policy to enable the Directors, employees and all stakeholders of the Company to report genuine concerns, to provide for adequate safeguards against victimisation of persons who use such mechanism and make provision for direct access to the Chairman of the Audit Committee.

Error! Reference source not found.

Whistle Blower Policy of your Company is available on the Companys website and can be accessed in the Governance section at the Web-link http://arssgroup.in/PDF/ArssPolicy/Vigil%20Mechanism%20and%20Whistle%20 Blower%20Policy.pdf

The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 / Internal Complaint Committee

The Company has a detailed policy in place in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("Act"). Internal Complaints Committees ("ICC") have been set up to redress complaints received regarding sexual harassment and the Company has complied with provisions relating to the constitution of ICC under the Act. The objective of the policy is to prohibit, prevent and address issues of sexual harassment at the workplace. This policy has striven to prescribe a code of conduct for the employees and all employees have access to the Policy document and are required to strictly abide by it. All employees (permanent, contractual, temporary, trainees) are covered under this Policy. During the year 2022-2023, no case of Sexual Harassment was reported.

Share Capital

The issued, subscribed and paid-up Share Capital of the Company stood at INR 22.73 crores as at 31st March, 2023 comprising of 2,27,37,966 (Equity) Shares of INR 10 each fully paid-up. There was no change in Share Capital during the year under review.

Compliance with the provisions of Secretarial Standard 1 and Secretarial Standard 2

The applicable Secretarial Standards, i.e. SS-1 and SS-2, relating to ‘Meetings of the Board of Directors and ‘General Meetings respectively, have been duly complied by your Company.

Policies

The details of the Key Policies adopted by the Company can be accessed in the Governance section at the Web-link http://arssgroup.in/ArssPolicies.html

Remuneration policy

The Board has on the recommendation of the Nomination and Remuneration Committee framed and adopted the Policy for selection and appointment of directors, senior management and their remuneration. The Board recognizes that the various Committees of the Board have very important role to play to ensure highest standards of corporate governance. The remuneration policy is stated in the Corporate Governance Report.

Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information

Pursuant to the amendments in the SEBI (Prohibition of Insider Trading) Regulations, 2015 vide The SEBI (Prohibition of Insider Trading) (Amendment) Regulations, 2018 the Board of Directors of the Company has adopted new code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information ("UPSI") ("Fair Disclosure Code") incorporating a policy for determination of "Legitimate Purposes" as per Regulation 8 and Schedule A to the said regulations w.e.f. 1st April, 2019.

Whistle blower policy

The Company has adopted a Whistle Blower Policy through which the Company encourages its employees to bring to the attention of Senior Management, including Audit Committee, any unethical behavior and improper practices and wrongful conduct taking place in the Company. The details of the same is explained in the Corporate Governance Report and also posted on the website of the Company at the link http://arssgroup.in/PDF/ArssPolicy/Vigil%20 Mechanism%20and%20Whistle%20Blower%20Policy.pdf

Code of Conduct to Regulate, Monitor and Report Trading by Insiders

Pursuant to amendments in the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 vide the Securities and Exchange Board of India (Prohibition of Insider Trading) (Amendment) Regulations, 2018, the Company adopted the revised "Code of Conduct to Regulate, Monitor and Report Trading by Designated Persons" as per Regulation 9 and Schedule B to the said regulations w.e.f. 1st April, 2019.

Policy for Determining Material Subsidiaries

Pursuant to amendments in the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, amended from time to time, the Company has adopted the revised "Policy for Determining Material Subsidiaries" for laying down a criterion for determining Material Subsidiaries and their governance as per Regulation 16(1)(c) to the said regulations w.e.f. 1st April, 2019.

Insurance

The Companys plant, property, equipments, vehicles and stocks are adequately insured against major risks. The Company has also taken Directors and Officers Liability insurance Policy to provide coverage against the probable liabilities arising on them. However due to CIRP the same has not been renewed.

Disclosure under Insolvency and Bankruptcy Code (Corporate Insolvency Resolution Process (CIRP)

A petition for initiation of Corporate Insolvency Resolution Process under Section 7 of the Insolvency and Bankruptcy Code, 2016 filed by State Bank of India (Financial Creditor) has been admitted against the Company vide Honorable National Company Law Tribunal, Cuttack bench order dated 30.11.2021 and Mr. Uday Narayan Mitra (Reg. No. IBBI/IPA001/ IP-P00793/2017-18/11360) having address at 72/1, Dawnagazi Road, bally, Kolkata West Bengal -711201 (Email- udaynarayanmitra@yahoo.co.uk) has been appointed as Interim Resolution Professional/ Resolution Professional by NCLT, Cuttack Bench under Section 13(1)(c) of the Insolvency and Bankruptcy Code, 2016. As a part of CIRP, financial and operational creditors were called upon to submit their claims to the IRP on or before 16th December, 2021, being the last date of submission.

Pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (LODR), and in accordance with the requirements of sub-clause 16(h) of Para A of Part A of Schedule III of LODR read with Section 25(2)(h) of Insolvency & Bankruptcy Code, 2016 and Regulation 36A of IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, the Invitation for Expression of Interest in Form - G was published on 13th April, 2022 for its submission to the RP on or before 28th April, 2022 pursuant to which the Resolution Professional has received one (1) resolution plan. The matter is under active deliberation.

During the year under review, the power of the board was vested with Mr. Uday Narayan Mitra (Reg. No. IBBI/IPA001/ IP-P00793/2017-18/11360) having address at 72/1, Dawnagazi Road, bally, Kolkata West Bengal -711201 (Email- udaynarayanmitra@yahoo.co.uk) as appointed as Resolution Professional by NCLT, Cuttack Bench under Section 13(1)(c) of the Insolvency and Bankruptcy Code, 2016.

Total 17th COC meeting (Committee of Creditors Meeting) was conducted by the RP during the year to take various decision to run the company as going concern and to approve the resolution plan. The resolution plan submitted by RA has been approved by 76.67% votes in favour. And the approved plan was submitted by RP with Adjudicating Authority (A/A) on 06.01.2023 which was rejected by Honble NCLT, Cuttack Bench, Cuttak vide its order dated 18.04.2023.

The Resolution Applicant moved to Honble National Company Law Appellate Tribunal, New Delhi against the order rejecting the resolution plan passed by NCLT dated 18.04.2023. The Honble NCLAT passed an order dated 25th April, 2023, directing for liquidation shall remain stayed and resolution professional shall continue to manage the affairs of the company as a going concern.

The Application has been allowed by the Honble NCLAT, New Delhi vide its order dated 09-08-2023 by setting aside the order rejecting the resolution plan passed by the Honble NCLT, Cuttack bench vide its order dated 18.04.2023 and allowed the Resolution Applicant to prepare an addendum as per the said order.

Disclosure requirements:

As per SEBI Listing Regulations, the Corporate Governance Report with the Auditors Certificate thereon, and the Management Discussion and Analysis Report are attached, which forms part of this report. The Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

Green Initiatives & Acknowledgement :

As a responsible corporate citizen, the Company supports the ‘Green Initiative undertaken by the Ministry of Corporate Affairs, Government of India, enabling electronic delivery of documents including the Annual Report etc. to Members at their

e-mail address registered with the Depository Participants ("DPs") and RTAs. To support the ‘Green Initiative, Members who have not registered their email addresses are requested to register the same with the Companys Registrar and Share Transfer Agent ("RTAs")/Depositories for receiving all communications, including Annual Report, Notices, Circulars, etc., from the Company electronically.

Pursuant to the MCA Circular No. 10/2022 dated 28 December 2022 and SEBI Circular dated 05 January 2023, the Annual Report of the Company for the financial year ended 31 March 2023 including therein the Audited Financial Statements for the financial year 2022-23, are being sent only by email to the Members.

The Board / Resolution Professional together with Key Managerial Personnel would like to acknowledge and place on record their sincere appreciation for assistance and co-operation received from the financial institutions, banks, Government authorities, customers and members during the year under review. Your Directors also place on record their deep sense of appreciation for the committed services by the executives, employees at all levels.

Your Resolution Professional appreciate and value the contribution made by every member of the ARSS family.

For and on behalf of the Board of Directors (suspended during CIRP)

Sd/- Sd/- Sd/-

Place: Bhubaneswar

Subash Agarwal Chairman (DIN:00218066) Rajesh Agarwal Managing Director (DIN: 00217823) (Uday Narayan Mitra) Resolution Professional (IP Reg.No.IBBI/IPA001/
Dated: August 11, 2023 (Suspended during CIRP) (Suspended during CIRP) IP-P00793/2017-18/11360)