To,
The Members,
FIRST FINANCIAL SERVICES LTD, (CIN: L85100TN1984PLC011231)
Chennai
Your Directors have great pleasure in presenting 35th ANNUAL REPORT on the business and
operations of your Company with the Audited Accounts for the year ended 31st March, 2020.
The financial results of the Company are summarized below:
1. FINANCIAL RESULTS
| PARTICULARS |
FINANCIAL YEAR ENDED 31st MARCH 2020 |
FINANCIAL YEAR ENDED 31st MARCH 2019 |
| Total Revenue |
19,713,811.00 |
5,836,992.00 |
| Profit/(Loss) before Taxation |
(22,685,976.00) |
(38,478,376.00) |
| Provision for Taxation |
- |
- |
| Current Tax |
- |
- |
| -Deferred Tax |
2,712,579.00 |
- |
| Tax of earlier year |
- |
- |
| Profit/(Loss) After Tax |
(25,398,555.00) |
(38,478,376.00) |
FINANCIAL HIGHLIGHTS
• Profit/(Loss) before taxes for fiscal 2020 was Rs.(22,685,976).
• Profit/(Loss)after taxes for fiscal 2019 was Rs. (25,398,555).
• Basic Earning Per Share for fiscal 2020was Rs. (0.31) per share.
• Net Worth of Company stood at Rs. 114,754,656.00
IMPACT OF COVID-19 PANDEMIC AND MITIGATION MEASURES IMPLEMENTED
Due to COVID-19 outbreak globally in 2020 and to restrict the spread of the pandemic in
India, the Government announced national lockdown with effect from March , 2020, which
caused disruption of supply of goods across business and industries. These restrictions
had resulted in temporary shutdown of operations at all plants and offices for
approximately 30 days The Company has taken various steps to support its various
stakeholders and maintain operations.In accordance with the Governments directive post
partial lifting of the lockdown from April 2020 and after receiving the necessary
approvals from the respective government departments, the Company had resumed partial
operations. The necessary precautions and safety measures are put in place to maintain
social distancing.
2. RESERVES
The Company does not propose to carry any amount to reserves.
3. CAPITAL STRUCTURE
There was no change in the Authorized and Paid-up Share Capital of the Company during
the year.
The Authorized Share Capital of the Company is Rs. 160,000,000/- (Rupees Sixteen Crores
only) divided into 160,000,000 (Sixteen Crores) Equity Shares of Rs. 1/- (Rupee One) each.
The Paid-up Share Capital of the Company is Rs. 80,747,600/- (Rupees Eight Crores Seven
Lacs Forty Seven Thousand and Six Hundred only) divided into 80,747,600 (Eight Crores
Seven Lacs Forty Seven Thousand and Six Hundred) Equity Shares of Rs. 1/- (Rupee One)
each.
4. DIVIDEND
The directors do not recommend any dividend for the year under consideration.
5. MATERIAL CHANGES AND COMMITMENTS, IF ANY, 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 are no material changes and commitments affecting the financial position of the
Company.
6. CHANGE IN NATURE OF BUSINESS
There is no change in nature of business carried on by the Company.
7. MANAGEMENTDISCUSSION AND ANALYSIS REPORT
The Management Discussion and Analysis Report is enclosed as a part of this report.
8. CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION
Your Company has taken adequate steps to adhere to all the stipulations laid down in
Regulation 17 to 27 of SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015. A report on Corporate Governance is included as a part of this Annual Report. A
Certificate from the Statutory Auditors M/s. Singhal & Sewak., Practicing Chartered
Accountants, Mumbai of the Company confirming the compliance with the conditions of
Corporate Governance as stipulated of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 is enclosed as a part of this report in Annexure-4.
9. LISTING WITH STOCK EXCHANGE
The Companys shares are listed on BSE Limited. However the Company has been suspended
from BSE Limited due to surveillance measures w.e.f 31stDecember , 2014.
10. DIRECTORS AND KEY MANAGERIAL PERSONNEL
i) CHANGES IN DIRECTORS
Mr. Selvaraj Selvam Arumai (DIN: 08268028), Additional Director of the Company was
regularize in the 34th Annual General Meeting of the Company and appointed as an
Independent Director of the Company for a term of 5 years. No other changes took place in
the composition of Board of Directors during the financial year 2019-20.
ii) DECLARATION BY INDEPENDENT DIRECTORS
All the Independent Directors have given a declaration that they meet the criteria of
independence as laid down under section 149(6) of the Companies Act, 2013 and Regulation
25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and
there has been no change in the circumstances which may affect their status as Independent
Directors during the year.
iii) CHANGES IN KEY MANAGERIAL PERSONNEL
There are no changes in the composition of the Key Managerial Personnel.
iv) MEETINGS OF THE BOARD OF DIRECTORS
The Board of Directors of the Company have met Twelvetimes during the year on 08th
April 2019, 10th May 2019, 29th May 2019, 20th June 2019, 05th August, 2019, 13th August
2019, 31st August 2019, 22nd October 2019, 01st November 2019, 14th November 2019, 09th
December 2019 and 13th February 2020 in respect of which proper notices were given and
proceedings were properly recorded, signed and maintained in the Minutes Book kept by the
Company for the purpose. The intervening gap between the Meetings was within the period
prescribed under the Companies Act, 2013.
v) COMMITTEES OF THE BOARD
The Company has constituted an Audit Committee, Nomination and Remuneration Committee
and Stakeholders Relationship Committee as per the provisions of the Companies Act, 2013
and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. A detailed
note on the Board and its Committees are provided under the Corporate Governance Section
in this Annual Report. The composition of the Committees, as per the applicable provisions
of the Act and Rules, are as follows:
| Name of the Committee |
Composition of the Committee |
| Audit Committee |
Mrs. Chandrika Panchal (Chairperson) |
|
Mr. Nirmal Singh Mertia (Member) |
|
Mr. Girishkumar Panchal (Member) |
| Nomination and Remuneration Committee |
Mrs. Chandrika Panchal (Chairperson) |
|
Mr. Girishkumar Panchal (Member) |
|
Mr. Selvaraj Selvam Arumai(Member) |
| Stakeholders Relationship Committee |
Mr. Girishkumar Panchal (Chairman) |
|
Mr. Nirmal Singh Mertia (Member) |
|
Mrs. Chandrika Panchal (Member) |
vi) BOARD EVALUATION
Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015, a separate exercise was carried out to
evaluate the performance of individual Directors including the Chairman of the Board, who
were evaluated on parameters such as level of engagement and contribution and independence
of judgment thereby safeguarding the interest of the Company. The performance evaluation
of the Independent Directors was carried out by the entire Board. The performance
evaluation of the Whole Time Director was carried out by the Independent Directors. The
board also carried out annual performance evaluation of the working of its Audit,
Nomination and Remuneration as well as Stakeholders Relationship Committee. The Directors
expressed their satisfaction with the evaluation process.
11 . POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION AND OTHER DETAILS
The Companys policy on Directors Appointment and Remuneration and other matters
provided in Section 178(3) of the Act has been disclosed in the Corporate Governance
Report.
12. INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY
The details in respect of internal financial control and their adequacy are included in
Management Discussion and Analysis, which forms part of this Report.
13. DISCLOSURE OF REMUNERATION OF EMPLOYEES COVERED UNDER RULE 5 OF THE COMPANIES
(APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014:-
The information required under Section 197 of the Act read with Rule 5(1) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given
below:
i. The percentage increase in Remuneration of each Director and ratio of the
Remuneration of each Director to the median Remuneration of the employees of the Company
for the financial year:
| Sr No |
Directors Name |
Designation |
Remuneration 2019-2020 |
Remuneration 2018-2019 |
Increase/Decre ase |
| 1. |
Nirmal Singh Mertia |
Whole Time Director |
4,67,505 |
3,91,723 |
19.35% |
ii. The percentage Increase In remuneration of each director, Chief Financial Officer,
Chief Executive Officer, Company Secretary or Manager, if any, in the financial year:
| Sr No |
Directors Name |
Designation |
Remuneration |
Remuneration |
Increase/Decre ase |
|
|
|
2019-2020 |
2018-2019 |
|
| 1. |
Nirmal Singh Mertia |
Whole Time Director |
4,67,505 |
3,91,723 |
19.35% |
iii. Affirmation that the remuneration is as per the remuneration policy of the
Company:
The Company affirms that the remuneration is as per the remuneration policy of the
Company.
No employee of the Company is falling under Rule 5(2) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014.
14. AUDITORS
i) Statutory Auditor s
The Company in its 33rd Annual General Meeting (AGM) held on 30th September, 2018
appointed M/s Singhal & Sewak, (Firm Registration No. 011501C), Chartered Accountants,
Mumbai, as its Statutory Auditors to hold office for the period of five consecutive years
from the conclusion of the 33rd Annual General Meeting until the conclusion of 38th Annual
General Meeting of the Company.
ii) Secretarial Auditor
According to the provisions of Section 204 of the Companies Act, 2013 read with Rule 9
of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the
Secretarial Audit Report submitted by Secretarial Auditor – Somani & Associates
(Company Secretaries) (M. No. F9364, COP No. 8642), is enclosed as a part of this report
in Annexure-1.
iii) Internal Auditors
M/s Rahul Drolia, Chartered Accountant, Mumbai performs the duties of Internal Auditors
of the Company and their report is reviewed by the Audit Committee from time to time.
15. COMMENT ON AUDITORS REPORT
Statutory Auditors
The Statutory Auditors report is self explanatory in nature.
Secretarial Auditor
The Company is in the process of appointing a Company Secretary and Chief Financial
Officer required under section 203 of the Companies Act, 2013 and making all necessary
efforts for the same.
In the final order passed on 02 April, 2018 , SEBI has prohibited First Financial
Services Limited from accessing the securities market and further prohibit them 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 three
years from the date of said order i.e. 02nd April, 2018. However, Further company filed an
appeal to SAT and SAT, vide its final order dated on 27.09.2019, ordered that it was
observed that 3 years already elapsed from the impugned exparte order dated 19/12/2014 and
restriction on buying or selling the securities will come to an end.
Your Company believes in best investor relation practices. Hence, Management of the
Company ensures to be more careful /proactive and dedicated in all of the compliances
henceforth.
16. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement of clause (c) of sub-section (3) of Section 134 of the
Companies Act, 2013, your Directors confirm that:
i) That in the preparation of the annual accounts for the financial year ended 31st
March, 2020 the applicable accounting standard had been followed along with proper
explanation relating to material departures.
ii) That the directors had selected such accounting policies and applied them
consistently and made judgments and estimates that were 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 the year under review.
iii) That the directors had taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provision of the Companies Act, 2013
for safeguarding the assets of the Company and for preventing and detecting fraud and
other irregularities.
iv)That the directors had prepared the accounts for the financial year ended 31st
March, 2020 on a going concern basis.
v) That the directors had laid down internal financial controls to be followed by the
Company and that such internal financial controls are adequate and were operating
effectively.
vi)That the directors had devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems were adequate and operating
effectively
17. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
Conservation of energy and technology absorption information pursuant to section
134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules,
2014 is not applicable to the Company. There are no Foreign Exchange Earnings and Outgoes
during the year.
18. VIGIL MECHANISM/ WHISTLE BLOWER POLICY
Pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a
Vigil Mechanism for directors and employees to report genuine concerns has been
established. The Vigil Mechanism Policy has been uploaded on the website of the Company at
http://ffslonline.com/whistle-blower-policy/
19. RELATED PARTY TRANSACTIONS
Related party transactions that were entered during the financial year were on an arms
length basis and were in the ordinary course of business. There were no materially
significant related party transactions with the Companys Promoters, Directors, Management
or their relatives, which could have had a potential conflict with the interests of the
Company. Transactions with related parties entered by the Company in the normal course of
business are periodically placed before the Audit Committee and the particulars of
contracts entered during the year as per Form AOC-2 is enclosed as Annexure-2.
The Board of Directors of the Company have, on the recommendation of the Audit
Committee, adopted a policy to regulate transactions between the Company and its Related
Parties, in compliance with the applicable provisions of the Companies Act 2013, the Rules
there under and the SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015. This Policy was considered and approved by the Board and has been uploaded on the
website of the Company at http://ffslonline.com/related-party-transcation/
20. EXTRACT OF ANNUAL RETURN
As per amendment section 23 of the Companies(Amendment) Act, 2017, extract of the
Annual Return in Form MGT-9 is annexed herewith as Annexure-3 as well as available
on the website of the Company at http://ffslonline.com
21. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
Details of Loans, Guarantees and Investments covered under the provisions of Section
186 of the Companies Act, 2013, if any, are given in the notes to the Financial
Statements.
22 . DEVELOPMENT AND IMPLEMENTATION OF A RISK MANAGEMENT POLICY
The Company has been addressing various risks impacting the Company and the policy of
the Company on risk management is provided elsewhere in this annual report in Management
Discussion and Analysis.
23. DEPOSITS
The Company has not acceptedor invited any deposits during the financial year
2019-2020.
24. DISCLOSURE OF MAINTENANCE OF COST RECORDS
Maintenance of Cost records as specified by the Central Government under sub-section
(1) of section 148 of the Companies Act, 2013 is not applicable to the Company.
25. CASH FLOWSTATEMENT
In conformity with the provisions of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 and requirements of Companies Act, 2013, the Cash flow
Statement for the financial year ended 31.03.2020 is annexed here to as a part of the
Financial Statements.
26. LEGAL
In the final order passed on 02 April, 2018 , SEBI has prohibited First Financial
Services Limited from accessing the securities market and further prohibit them 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 three
years from the date of said order i.e. 02nd April, 2018. However, Further company filed an
appeal to SAT and SAT, vide its final order dated on 27.09.2019, ordered that it was
observed that 3 years already elapsed from the impugned exparte order dated 19/12/2014 and
restriction on buying or selling the securities will come to an end.
27. POSTAL BALLOT
During the year, no postal ballots were held.
28. CORPORATE SOCIAL RESPONSIBILITY
The provisions of Corporate Social Responsibility under section 135 of Companies Act,
2013 and Companies (Corporate Social Responsibility Policy) Rules, 2014 are not applicable
on the Company.
29. COMPLIANCE WITH SECRETARIAL STANDARDS
The Company has complied with Secretarial Standards issued by the Institute of Company
Secretaries of India on Board Meetings and General Meetings. As required in terms of
Secretarial Standard (SS)-4, it is hereby confirmed that there is no corporate insolvency
resolution process initiated under the Insolvency and Bankruptcy Code, 2016.
30. DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION
& REDRESSAL) ACT, 2013
There was no case filed during the year, under the Sexual Harassment of Women at
Workplace (Prevention, Prohibition & Redressal) Act, 2013. Further, the Company
ensures that there is a healthy and safe atmosphere for every women employee at the
workplace and have made necessary policies for safe and secure environment for women
employees. The Company has in place an Anti-Sexual Harassment Policy in line with the
requirements of The Sexual Harassment of Women at Work Place (Prevention, Prohibition and
Redressal) Act, 2013. An Internal Complaints Committee has been set up to redress
complaints received regarding sexual harassment. The Company affirms that during the Year
under review, no complaints were received by the Committee for redressal.
31. ACKNOWLEDGMENT
The Directors wish to thank and deeply acknowledge the cooperation and assistance
received from the Bankers and Shareholders. The Director also wishes to place on record
their appreciation of the devoted services of employees of the Company.
| Place: Mumbai |
|
On behalf of the Board |
| Date:01 stSepte mber, 2020 |
|
For First FinancialServices Limited |
|
Sd/- |
Sd/- |
|
Mr. Nirmal Singh Mertia |
Mr. Girishkumar Panchal |
|
Whole Time Director |
Director |
|
(DIN: 03584434) |
(DIN: 07227360) |
+91-9892691696
