Chandni Machines Ltd Directors Report.

To

The Members Chandni Machines Limited,

(formerly known as Chandni Machines Limited)

Your Directors have pleasure in presenting the 2ndAnnual Report on the business and operations of the Company together with the audited accounts for the financial year ended on 31st March, 2018.

1. FINANCIAL SUMMARY /PERFORMANCE OF THE COMPANY

Financial performance of your Company for the financial year ended 31stMarch, 2018 is summarized below:

(In Rs.)
Particulars Standalone
March 31, 2018 March 31, 2017
Revenue from Operations 19,74,87,177 NIL
Other Income 11,14,841 NIL
Total Revenue 19,86,02,018 NIL
Profit before Depreciation, Interest and Tax
(PBDIT) 1,11,04,779 NIL
Less: Depreciation (12,932) NIL
Less: Finance Cost (77,290) NIL
Profit Before Tax 1,10,14,557 NIL
Provision for Tax :
Current Tax (30,50,000) NIL
Deferred tax 2,49,600 NIL
Profit/(Loss) After Tax 82,14,157 NIL
Add: Profit of Demerged undertaking from 01/07/2016 i.e. Appointed Date to 31/03/2017 transferred from CTEIL in pursuance to scheme of demerger 55,02,216 NIL
Balance carried to Balance sheet 1,37,16,373 NIL

2. REVIEW OF OPERATIONS

During the year under review, the revenue of the company increased to Rs. 19,86,02,018/- as compared to previous year. The Profit before Tax has increased to Rs.1,10,14,557/- and Net Profit of the Company increased to Rs. 82,14,157/- as compared to previous year respectively.

3. IMPLEMENTATION OF INDIAN ACCOUNTING STANDARDS (Ind AS)

The Financial Statmeent for the year ended 31st March, 2018 have been prepared in accordance with the Indian Accounting Standard (Ind AS) notified under Section 133 of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 and other relevant provisions of the Act.

4. DIVIDENDS

Your Directors do not recommend any dividend for the Financial Year 2017-2018.

5. CONVERSION OF PRIVATE LIMITED COMPANY INTO PUBLIC LIMITED COMPANY

During the year under review and pursuant to the order received by Honble National Company

Law Tribunal (NCLT), Mumbai bench order dated 04th January, 2018, Chandni Machines

Private Limited (CMPL) (hereinafter known as the “Company”) has to list its Equity Shares on Bombay Stock Exchange Limited and therefore, it is necessary to get the company converted into Public Limited Company. The Company received its Certificate of Incorporation upon Conversion of Private Limited Company into Public Limited Company on 26th day of July, 2018.

6. SCHEME OF ARRANGEMENT -DEMERGER

The Board of Directors of the company, at their meeting held on 11th day of August, 2016 approved the Scheme of Arrangement, for the Demerger of Engineering Division of CTEIL (“Demerged Company”) in the favour of CMPL (“Resulting Company”). Further, the National Company Law Tribunal (NCLT), Mumbai Bench directed that the meeting of the Equity Shareholders be convened to approve the Scheme of Arrangement. As per the directions received from NCLT, the meeting of Equity Shareholders was held and convened on 21st day of August, 2017 to approve the said Scheme of Arrangement.

Pursuant to the Scheme of Arrangement between Chandni Textiles Engineering Industries Limited (CTEIL) (Demerged Company) and Chandni Machines Private Limited (CPML) (Resulting Company) and their respective shareholders and creditors under Sections 230 to 232 read with Section 52 and 66 of the Companies Act, 2013 and other applicable provisions if any of the Companies Act, 2013 (“the Scheme”) as sanctioned by the Honble National Company Law Tribunal (NCLT) bench at Mumbai on 04th day of January, 2018, the Demerged Undertaking i.e the Engineering Division of CTEIL (“Demerged Company”) has been transferred and vested in the Resulting company (CPML) as a going concern basis with effect from 01st day of July, 2016 i.e. the Appointed date under the scheme. Further, Chandni Machines Private Limited on 24th day of January, 2018 filed the certified copy of the order (‘Scheme of Arrangement”) in e-form INC-28 vide SRN No. G74490277 being the effective date for the Scheme of Arrangement.

In the accounts of the Company for the Financial Year 2017-2018 accounting effect has been given for the demerger. All the assets and liabilities pursuant to the Scheme of Arrangement have been transferred to the Resulting Company i.e. Chandni Machines Limited (CML) at their respective book values on the appointed date.

7. ALLOTMENT OF SHARES

Pursuant to the Scheme of Arrangement between CTEIL (“Demerged Company”) and CMPL

(“Resulting Company”) as approved by the Honble NCLT, Mumbai bench, CMPL will issue and allot 1 (one) fully paid up Equity share of Rs.10/- each to the shareholders of CTEIL (“Demerged Company”) for every 5 (Five) fully paid up Equity shares of Rs. 10/- each held by the shareholders as on record date as fixed by Demerged Company.

The existing Equity Shares Capital for an amount of Rs. 1, 00, 000/- divided into 10,000 Equity Shares of Rs. 10/- each will be cancelled and shareholders holding 10,000 Equity Shares in the Resulting Company will not be issued and allotted any new shares upon such cancellation. After allotment of the Equity Shares, Chandni Machines Limited will cease to be the wholly owned subsidiary company of Chandni Textiles Engineering Industries Limited (“Demerged Company).

8. MATERIAL CHANGES AND COMMITMENTS

Chandni Machines Private Limited (Resulting Company) was 100% wholly owned subsidiary company of Chandni Textiles Engineering Industries Limited (Demerged Company).Pursuant to the certified copy of order as received by Honble National Company Law Tribunal relating to the Scheme of Arrangement (Demerger), the business and activities as carried on by Engineering Division of Demerged Company will be transferred into Resulting Company.

9. INCREASE IN THE AUTHORISED SHARE CAPITAL

During the year under review and pursuant to section 13 and 61 and other applicable provisions, if any, of the Companies Act, 2013 the company increased its authorized Share Capital from Rs. 3,00,00,000 /- (Rupees Three Crore only) divided into 30,00,000 (Thirty lakhs) Equity shares of Rs. 10/- (Rupees ten) each to Rs. 3,25,00,000 /- (Rupees Three Crore Twenty Five lakhs only) divided into 32,50,000 (Thirty Two lakh Fifty Thousand) Equity Shares of Rs. 10/- (Rupees ten) each by creation of additional Rs. 25,00,000/- (Rupees Twenty Five lakhs) divided into 2,50,000 (Two lakh Fifty Thousand) Equity Shares of Rs.10/- (Rupees ten) each ranking pari-passu in all respect in Extra-Ordinary General Meeting held on shorter notice with the consent of all the shareholders of the company on 21st day of February, 2018.

10. DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with the provisions of section 152 of the Companies Act, 2013 and the Articles of Association of the company, Mrs. Amita Jayesh Mehta, Director retires by rotation at the ensuing Annual General Meeting and become eligible, offers herself for re-appointment. The Board of Directors recommends her re-appointment.

Mr. Bharat Keshavlal Shah was appointed as an Additional Director in the company in their Board Meeting held on 07th day of February, 2018. Later on, he was regularized as an Executive

Director of the company with the shareholders approval in the Extra-Ordinary General Meeting of the Company held on 21stday of February, 2018.

None of the directors is disqualified for appointment/ re-appointment under section 164 of the

Companies Act, 2013. As required by the law, this position is also reflected in the Auditors report.

11. BOARD MEETINGS

Number of meetings of the Board of Directors: During the year under review, five Board meetings were conducted. The details of which as mentioned below:

Date of Meeting No. of Directors Present
30.05.2017 2
14.08.2017 2
01.11.2017 2
24.01.2018 2
07.02.2018 2

12. DIRECTORSf RESPONSIBILITY STATEMENT

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

a. that in the preparation of the annual financial statements for the financial year ended 31st March, 2018; the applicable accounting standards had been followed along with proper explanation relating to material departures;

b. that suchaccounting policies have been selected and applied consistently and judgments and estimates have been made 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, 2018and of the profit of the Company for the year ended on that date;

c. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. that the annual financial statements for the financial year ended 31st March, 2018 have been prepared on a going concern basis; and

e. that the proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

13. DEPOSITS

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014 as on 31st March, 2018.

14. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186

During the year under review, the Company has not given any loans or guarantees or made any investments governed under the provisions of Section 186 of the Companies Act, 2013.

15. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

During the year under review, all transactions entered into by the Company with Related Parties as defined under the Companies Act, 2013, were in the ordinary course of business and on an arms length basis. The disclosure of Related Party transactions as required under Section 134(3)(h) of the Companies Act,2013 in Form AOC-2 is given in Annexure A of this Report.

Disclosure of transactions with related parties as required under the applicable Accounting Standards has been made in the Notes forming part of the Financial Statements.

16. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Since your company does not own any manufacturing facility, the particulars relating to conservation of energy and technology absorption stipulated in section 134 (3) (m) of the Companies Act, 2013 and Rule 8 of Companies (Accounts) Rules, 2014 are not applicable.

During the year under review your company has following Foreign Exchange Earnings and Outgo:

Particulars F.Y. 2017-2018 F.Y. 2016-2017
Foreign Exchange Earnings NIL NIL
Foreign Exchange Outgo 3,04,38,443/- NIL

17. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS/COURTS /TRIBUNALS

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and companys operations in future.

18. AUDITOR AND AUDITORfS REPORT

The present Auditors of the Company M/s. Ambavat Jain & Associates LLP, Chartered Accountants (Firm Registration No.109681W) were appointed for a term of 5 years, pursuant to the resolution passed by the members at the First Annual General Meeting held on 29th September, 2017.Pursuant to Section 139(1) of Companies Act, 2013 read with Companies (Audit & Auditors) Rules, 2014 and as per Section 40 of the Companies (Amendment) Act, 2017, relating to ratification of appointment of Auditors every year has been omitted. Accordingly, the term of office of present Auditors viz., M/s Ambavat Jain & Associates, LLP (Firms Registration No.: 109681W) will be continued without ratification.

There are no qualifications, reservations or adverse remarks made by the statutory auditors in their audit report for the financial year ending on 31st March, 2018.

19. EXTRACT OF THE ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT-9 is annexed herewith as Annexure B”.

20. NUMBER OF COMPLAINTS RELATING TO SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

There were no complaints reported under the Prevention of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 during the financial year 2017-2018.

21. ACKNOWLEDGEMENT

The Board expresses its deep sense of gratitude to its stakeholders, Shareholders, Bankers and other Business Constituents for their continued support to your companys performance and growth. The Board places on record its appreciation of the dedicated services and contributions made by its employees for the overall performance of the Company during the year under review.

For & on behalf of the Board of Directors
For Chandni Machines Limited
(formerly known as Chandni Machines Private Limited)
Sd/-
Place: Mumbai Jayesh R Mehta
Date: 16.08.2018 (DIN: 00193029)
Director