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DHANUKA COMMERCIAL LIMITED
Your boards feels pleasure in presenting their 24th Annual Report together with the Audited Statement of Accounts for the year ended on 31st March 2018.
1. FINANCIAL HIGHLIGHTS
|(Amount in Rs.)|
|For the year ended 31.03.2018||For the year ended 31.03.2017|
|Total Revenue from Operations||1,28,31,576.80||94,90,451.27|
|Profit/(loss) from Ordinary activities before tax||(24,36,749.69)||(9,77,210.15)|
|Less: Tax Expenses||(1,368)||37,522|
|Net Profit/(loss) from Ordinary activities after tax||(24,35,381.69)||(10,14,732.15)|
|Add: balance brought forward||45,961.09||10,42,360.24|
|Less: Provision for Standard Assets||32,187||18,333|
|Less: Statutory Reserves Fund (u/s 45-IC of RBI Act, 1934)||-||-|
|Less: Transfer from Fixed Asset||-||-|
|Less: Provision for Proposed dividend||-||-|
|Less: Dividend Tax||-||-|
|Balance carried forward to Balance Sheet||(23,57,233.60)||45,961.09|
2. PERFORMANCE REVIEW
During the year under review, the Companys total income is Rs. 1,28,31,576.80/- (Rupees One Crore Twenty Eight Lakhs Thirty One Thousand Five Hundred Seventy Six and Eighty Paise only) as compared to Rs. 94,90,451.27/- (Rupees Ninety Four Lakhs Ninety Thousand Four Hundred Fifty One and Twenty Seven Paise only) in the previous year and the Company incurred a loss of Rs. 24,35,381.69/- (Rupees Twenty Four Lakhs Thirty Five Thousand Three Hundred Eighty One and Sixty Nine Paise only) as compared to Rs. 10,14,732.15/- (Rupees Ten Lakhs Fourteen Thousand Seven Hundred Thirty Two and Fifteen Paise only) in the previous year.
In order to comply with the provisions of Reserve Bank of India Act, 1934 the Company has not transferred any amount to Special Reserve Funds under Section 45-IC of the RBI Act, 1934 due to net loss during the year under review & has made provision of Rs. 32,187/- (Rupees Thirty Two Thousand One Hundred and Eighty Seven Only) for Standard Assets during the year under review. Total provisions for Standard Assets of the Company at the financial year ended 31st March, 2018 is Rs. 3,71,953/- (Rupees Three Lakhs Seventy One Thousand Nine Hundred and Fifty Three Only).
Except as mentioned above, no amount was proposed to transfer to any reserve by the Company during the year under review.
4. SHARE CAPITAL
There is no change in the authorized share capital and paid up share capital of the Company during the period under review.
The authorized share capital of the Company is Rs. 17, 00, 00,000 (Rupees Seventeen Crore only) divided into 1,70,00,000 (One Crore Seventy Lakhs) Equity Shares of Rs. 10/- each. The paid up share capital of the Company is Rs. 16, 74, 34,590 (Rupees Sixteen Crore Seventy Four Lakhs Thirty Four Thousand Five Hundred and Ninety Only) divided into 1, 67, 43,459 (One Crore Sixty Seven Lakhs Forty Three Thousand Four Hundred and Fifty Nine) Equity Shares of Rs. 10/- each.
Issue of Equity Shares with Differential Rights:-
During the financial year ended 31st March, 2018, the Company has not issued any Equity Shares with Differential Rights.
Issue of Employee Stock Options:-
During the financial year ended 31st March, 2018, the Company has not issued any Employee Stock Options as stated in Section 62(1) (b) of the Companies Act, 2013 and Rule 12(9) of Companies (Share Capital and Debenture Rules, 2014).
Issue of Sweat Equity Shares:-
During the financial year ended 31st March, 2018, the Company has not issued any sweat equity shares as specified in Section 54 of the Companies Act, 2013 and Rule 8(13) of Companies (Share Capital and Debenture Rules, 2014).
5. INFORMATION ON THE STATE OF AFFAIRS OF THE COMPANY
During the year under review, the Company was engaged in carrying on the business as Non -Banking Financial Company without accepting public deposit. The Company has provided / taken inter-corporate loans in ordinary course of business and on arms length basis.
6. HOLDING & SUBSIDIARY COMPANY
Since, the Company does not have any subsidiaries, Joint Ventures or Associate Companies, Rules 8(5) (IV) of the Companies (Accounts) Rules, 2014 does not apply to the Company.
7. PERFORMANCE AND FINANCIAL POSITION OF THE SUBSIDIARY COMPANIES
Since the Company has no Subsidiary Company, the clause is not applicable.
8. CONSOLIDATED FINANCIAL STATEMENT
Since the Company has no Subsidiary Company, the clause is not applicable.
Your directors do not recommend any dividend for payment to the shareholders/ members of the Company for the financial year ended on 31st March, 2018.
10. ADEQUACY OF INTERNAL FINANCIAL CONTROL WITH RESPECT TO THE FINANCIAL STATEMENT
The Company has in place adequate internal financial control with reference to financial statement. The Company also has an Internal Control System, commensurate with the size, scale and complexity of its operations.
11. DIRECTORS AND KEY MANAGERIAL PERSONNEL
Board of Directors
At present the Board of Directors consists of Mr. Gopal Krishan Bansal, Mr. Mahesh Kumar Dhanuka, Mr. Mukesh Bansal, Ms. Rajni Garg & Mr. Sanjeev Mittal.
In accordance with the provisions of Section 149 of the Companies Act, 2013, the Independent Directors have given a declaration that they meet the criteria of independence as provided in the said section.
During the year under review, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company, other than the sitting fees, commission and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.
As required under regulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the information on the particulars of the Directors proposed for appointment / re-appointment has been given in the Notice of the Annual General Meeting.
There was no change in the composition and position of Directors.
i. Retirement by Rotation of the Directors
Mr. Gopal Krishan Bansal retires by rotation at the forthcoming Annual General Meeting and, being eligible, offers himself for re-appointment.
ii. Key Managerial Personnel
At present, the Company has following persons Key Managerial Personnel (KMPs) as per provisions of the Companies Act, 2013 (the Act) and the Rules framed there under:-
|Mr. Mahesh Kumar Dhanuka||Managing Director|
|Mr. Sanjeev Mittal||Chief Financial Officer|
|Mr. Bharat Narula||Company Secretary|
During the period under review Mr. Sunil Jain, Company Secretary and Compliance Officer of the Company resigned from office on 09th June 2017 after serving proper notice period to the Company. Mr. Bharat Narula joined the Company as the Company Secretary and Compliance officer in place of Mr. Sunil Jain on 04th July 2017.
Mr. Ravi Garg resigned from the office of Chief Financial Officer with effect from closure of the business hours on 29th day of December, 2017. Mr. Sanjeev Mittal (Chairman & Executive Director) was appointed as the Chief Financial Officer with effect from 09th day of January, 2018 to fill the vacancy caused by the resignation of Mr. Ravi Garg.
During the financial year 2017-18, Six (06) board meetings were held: 28-04-2017, 29-05-2017, 04-07-2017, 14-08-2017, 13-11-2017 and 09-01-2018. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013.
Committees of the Board
The following are 3 Committees constituted by the Board:
i) Audit Committee;
ii) Stakeholders Relationship Committee;
iii) Nomination and Remuneration Committee;
The Composition of Board and Committees were as under:
|S.No Committee meeting||Composition|
|1 Audit Committee||Mr. Mukesh Bansal (Chairman)|
|Ms. Rajni Garg (Member)|
|Mr. Gopal Krishan Bansal (Member)|
|2 Nomination and Remuneration Committee||Ms. Rajni Garg (Chairman)|
|Mr. Mukesh Bansal (Member)|
|Mr. Gopal Krishan Bansal (Member)|
|3 Stakeholders Relationship Committee||Mr. Mukesh Bansal (Chairman)|
|Mr. Sanjeev Mittal (Member)|
|Mr. Gopal Krishan Bansal (Member)|
Table containing details of meetings of Board and various committees along with dates are as below:
|S. No||Board/ Committee Name||No. of meetings||Date of Meetings|
|1||Board Meetings (BM)||6||28 April 2017|
|29 May 2017|
|04 July 2017|
|14 August 2017|
|13 November 2017|
|09 January 2018|
|2||Audit Committee (AC)||4||15 April 2017|
|29 May 2017|
|14 August 2017|
|13 November 2017|
|3||Stakeholder Relationship||4||05 May 2017|
|Committee (SRC)||14 August 2017|
|13 November 2017|
|09 January 2018|
|4||Nomination and Remuneration||2||05 May 2017|
|Committee (NRC)||09 January 2018|
ATTENDANCE OF DIRECTORS / MEMBERS AT BOARD AND COMMITTEE MEETINGS
As per Standard 9 of the Secretarial Standard on Meetings of the Board of Director (SS-1) issued by the Institute of Company Secretaries of India (ICSI), the attendance of Directors at Board and Committee meetings held during the financial year 2017-18 is provided as under:
|Name of Director||BM||AC||NRC||SRC|
|Mr. Mahesh Kumar Dhanuka||1||0||0||0|
|Mr. Gopal Krishan Bansal||6||4||2||4|
|Mr. Sanjeev Mittal||6||0||0||4|
|Mr. Mukesh Bansal||5||4||2||4|
|Ms. Rajni Garg||1||3||2||0|
The Board has formulated an Evaluation Policy (the Policy) for evaluating the performance of the Board, Managing Director, Executive Directors, Independent Directors, Non-executive Directors and its Committees. Based on the same, the performance was evaluated for the financial year ended March 31, 2018.
The Policy inter alia provides the criteria for performance evaluation such as Board effectiveness, quality of discussion, contribution at the meetings, business acumen, strategic thinking, time commitment and relationship with the stakeholders, corporate governance practices, contribution of the Committees to the Board in discharging its functions, etc.
The Board has, on the recommendation of the Nomination and Remuneration Committee framed a policy for selection and appointment of directors, senior management and to fix their remuneration. The Nomination and Remuneration Policy is stated in the Corporate Governance Report.
Disclosures with respect to the remuneration of Directors and employees as required under Section 197 of the Act and Rule 5 (1) Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (Rules), details of employee remuneration as required under provisions of Section 197 of the Companies Act, 2013 and Rule 5(2) and 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are available at the registered office of the Company during working hours, 21 days before the Annual General Meeting and shall be made available to any shareholder on request and have been appended as "Annexure B" to this report.
12 SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
The Company has framed a Policy on Prevention of Sexual Harassment at workplace. There were no cases reported during the year ended March 31, 2018 under the Policy.
13 MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
As required under regulation 34 of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, the Management Discussion and Analysis Report are enclosed as a part of this report.
14 DIRECTORS RESPONSIBILITY STATEMENT
The Board of Directors acknowledges the responsibility for ensuring compliance with the provisions of section 134(3)(c) read with section 134(5) of the Companies Act, 2013 in the preparation of the Financial Statement for the financial year ended on 31st March, 2018 and state: i) That in the preparation of Annual Accounts for the financial year ended as at 31st March, 2018, the applicable Accounting Standards have been followed along with proper explanation relating to the material departures. ii) That the Directors have selected such Accounting Policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the financial year ended as at 31st March, 2018 and of the profit and loss of the Company for the financial year ended on 31st March, 2018.
iii) That the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the Assets of the Company and for preventing and detecting fraud or other irregularities. iv) That the Directors have prepared the Annual Accounts on a Going Concern basis. v) The Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and vi) There is a proper system to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditors and external consultants, including audit of internal financial controls over financial reporting by the statutory auditors, and the reviews performed by management and the relevant board committees, including the audit committee, the board is of the opinion that the Companys internal financial controls were adequate and effective during financial year 2017-18.
15 PUBLIC DEPOSITS
The Company did not accept any public deposits during the year under review. Therefore, the disclosures as required under the Companies Act, 2013 and the Rules framed there under and RBI Directions are not applicable.
16 PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
Loans, guarantees and investments covered under Section 186 of the Companies Act, 2013 form part of the Notes to the financial statements provided in this Annual report.
17 INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has proper and adequate system of internal control geared towards achieving efficiency in its operations, safeguarding assets, optimum utilization of resources and compliance with statutory regulations. The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. Testing of such Internal Control measures and systems forms a part of Internal Audit function. The Internal Auditors of the Company conduct audits of various departments based on an annual audit plan covering key areas of operations. Internal Audit reviews and evaluates the adequacy and effectiveness of internal controls, ensuring adherence to operating guidelines and systems and recommending improvements for strengthening them. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board. The Audit Committee of the Board of Directors reviews the adequacy of internal controls. This has improved the management of the affairs of the Company and strengthened transparency and accountability.
The Management ensures adherence to all internal control policies and procedures as well as compliance with regulatory guidelines. No significant audit observations and recommendations have been received from the Internal Auditors of the Company.
18 AUDITORS REPORT AND SECRETARIAL AUDIT REPORT
The Company at its meeting held on 14th August, 2017 appointed M/s Manish K & Associates, a firm of Company Secretaries in practice to undertake the Secretarial Audit of the Company for the financial year 2017 -18 in terms of provisions of section 204 of the Companies Act 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Report of the Secretarial Auditor for the Financial ended 31st March, 2018 is attached as an annexure as "Annexure D", which forms part of this report.
Further the statutory auditors report and secretarial auditors report does not contain any qualifications, reservations or adverse remarks.
a) STATUTORY AUDITORS:
Pursuant to the provision of section 139(2) of the Companies Act, 2013, No listed Company or a Company belonging to such class or classes of companies as may be prescribed, shall appoint or reappoint-(a) an individual as auditor for more than one term of five consecutive years; and (b) an audit firm as auditor for more than two terms of five consecutive years.
M/s DSP & Associates, Chartered Accountants (FRN-006791N), in accordance with the provisions of the Act, has been recommended to be re-appointed as the Statutory auditors of the Company by the Audit Committee and Board of Directors in their meeting held on 17th May, 2018 who shall hold office from the conclusion of this Annual General Meeting till the conclusion of its sixth annual General Meeting held after this Meeting, subject to the approval of the shareholders in the Annual General Meeting proposed to be held on 26th June, 2018.
The Company has obtained a written consent from M/s DSP & Associates, Chartered Accountants (FRN-006791N), New Delhi for their appointment and also a obtained certificate to the effect that their appointment, if made, would be in accordance with Section 139(1) of the Companies Act, 2013 and the rules made there under, as may be applicable.
20 EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form MGT-9 is annexed herewith as "Annexure C".
21 CORPORATE GOVERNANCE REPORT
Your Company practices a culture that is built on core values and ethical governance practices and is committed to transparency in all its dealings. Further the Members please note that as per "SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015" the Company is having a paid up equity share capital not exceeding Rs. 10 Crore and the Net worth not exceeding Rs. 25 Crore, thereby exempted from the corporate Governance Requirements provided under regulations 17 to 27 and clauses (b) to (i) of sub-regulation (2) of regulation 46 and Para C, D and E of Schedule V. Hence no certificate has been attached regarding compliances of conditions of corporate governance, however, the Company is voluntarily disclosing the information as required under the Corporate Governance section of SEBI (LODR) Regulations, 2015 and under Companies Act, 2013.
A detailed analysis of the Company and its performance is annexed to this report and forms part of this Report.
22 RELATED PARTY TRANSACTIONS
During the period, there were contracts or arrangements entered with related parties referred to in the provision of the Section 188(1) of the Companies Act, 2013, which are disclosed in AOC-2 which forms the part of this report and is annexed as "Annexure A".
23 CODE OF CONDUCT
The Board of Directors has approved a Code of Conduct which is applicable to the members of the Board and all employees in the course of day to day business operations of the Company. The Code has been placed on the Companys website http://www.dhanukacommercial.com.
The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to:
Code for Independent Directors
Code of internal Procedures and conduct for Regulating, Monitoring and Reporting of trades by Insiders
Policy for Determining Material Event
Details of Persons Authorised for Determining Material Event
All the Board Members and the Senior Management personnel have confirmed compliance with the Code.
24 VIGIL MECHANISM / WHISTLE BLOWER POLICY
Pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013 read with the rules made there under and pursuant to the provision of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has established a Vigil Mechanism to be known as the Whistle Blower Policy for its Directors and Employees, to report instances of unethical behaviour, actual or suspected, fraud or violation of the Companys Code of Conduct. The aim of the policy is to provide adequate safeguards against victimization of Whistle Blower who avails of the mechanism and also provide direct access to the Chairman of the Audit Committee, in appropriate or exceptional cases.
Accordingly, Vigil Mechanism / Whistle Blower Policy have been formulated with a view to provide a mechanism for the Directors and employees of the Company to approach the Company Secretary or the Chairman of the Audit Committee of the Company.
The purpose of this policy is to provide a framework to promote responsible and secure whistle blowing. It protects employees willing to raise a concern about serious irregularities within the Company. During the financial year 2017-18, no such complaint of unethical or improper activity has been received by the Company.
25 PREVENTION OF INSIDER TRADING
The Company has adopted a Code of internal Procedures and conduct for Regulating, Monitoring and Reporting of trades by Insiders with a view to regulate trading in securities by the Directors and designated employees of the Company. The Code requires pre-clearance for dealing in the Companys shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the trading window is closed. The Board is responsible for implementation of the Code. All Board of Directors and the designated employees have confirmed compliance with the Code.
26 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS / OUTGO a) CONSERVATION OF ENERGY
(i) The steps taken or impact on conservation of energy - The operations of your Company are not energy-intensive. However, adequate measures have been initiated for conservation of energy. (ii) The steps taken by the Company for utilising alternate source of energy - though the operations of the Company are not energy intensive, the Company shall explore alternative source of energy, as and when the necessity arises.
(iii) the capital investment on energy conservation equipments - Nil
b) TECHNOLOGY ABSORPTION
(i) The efforts made towards technology absorption - The minimum technology required for the business has been absorbed.
(ii) The benefits derived like product improvement, cost reduction, product development or import substitution - Not Applicable
(iii) In case of imported technology (imported during the last three years reckoned from the beginning of the financial year) - Not Applicable (a) The details of technology imported; (b) The year of import; (c) Whether the technology been fully absorbed; and (d) If not fully absorbed, areas where absorption has not taken place, and the reasons thereof (iv) The expenditure incurred on Research and Development - Not Applicable
c) FOREIGN EXCHANGE EARNINGS AND OUTGO
During the year under review, there were no foreign exchange earnings and outgo (previous year): NIL.
27 DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUB-SECTION (12) OF SECTION 143 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT
There are no frauds reported by Auditors under subsection (12) of Section 143.
28 MATERIAL CHANGES AND COMMITMENTS, IF ANY
There is no 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.
29 MATERIAL ORDERS BY GOVERNING AUTHORITIES
There were no significant or material orders passed by any governing authority of the Company including regulators, courts or tribunals which could impact the going concern status and Companys operations in future.
Your Companys operations were running smoothly during the year.
31 CORPORATE SOCIAL RESPONSIBILITY (CSR)
During the year under review, provision of section 135 and Schedule VII of the Companies Act, 2013 pertaining to Corporate Social Responsibility are not applicable to our Company. Hence, details of expenditures on CSR activities are not required to be furnished.
32 RISK MANAGEMENT
Your directors are of the view that the Risk evaluation and management is an ongoing process within the Company as per the risk management policy established by the Board. During the year under review, a regular exercise on Risk Assessment and Management was carried out covering the various aspects of business operations.
In view of the activities of the Company the directors are of the opinion that the Company has two major inherent risks which may threaten the existence of the Company which are "default in re-payment of loans by the customers" and "risks associated in the equity market". However, the Company has followed the principal of assessing the risk and accordingly managing the business.
The Risk Management Committee constituted by the Board of Directors of the Company has framed and implemented a Risk Management Policy.
33 HUMAN RESOURCE-INITIATIVES
During the year under review, a lot of focus was given to engage employees at every level by conducting structured interactions and imparting information and knowledge with regards to the training given in AML/CFT areas which inter alia includes familiarization with the AML/CFT guidelines issued by the RBI from time to time. The management has also been pro-active in sharing the Companys long term perspective and their role within the organization. New behavioural training programs were also introduced to widen the scope of learning and development activity.
34 LISTING OF SECURITIES
Presently, the Securities of the Company are listed on SME Platform of BSE Limited, Mumbai. The listing fee for the financial year 2018-19 has been paid.
Your directors would like to place their grateful appreciation for the assistance and co-operation received from the Companys bankers during the year under review. The directors also acknowledge with appreciation the support and co-operation rendered by various Government Agencies and Departments. Your Directors would also wish to place on record their deep sense of appreciation for the continued support of all the investors of the Company.
|By the Orders of the Board of Directors of|
|"Dhanuka Commercial Limited"|
|Date: 17th May, 2018||Sanjeev Mittal|
|Chairman (ED & CFO)|