Himadri Credit & Finance Ltd Directors Report.
Your Directors have pleasure in presenting the 21st Annual Report of your Company together with the Audited Financial Statements, for the financial year ended 31 March, 2016.
STATE OF AFFAIRS OF THE COMPANY
The Financial Results of the Company for the year under review and those of the previous year are given below:
|Amount Rupees in Lakhs|
|Particulars||For the year ended 31.03.2016||For the year ended 31.03.2015|
|Less: Total Expenditure||46.32||28.70|
|Profit before tax||2.60||5.59|
|Less: Deferred tax||0.24||(0.76)|
|Profit after tax||2.36||6.34|
|Balance brought forwarded from previous year||309.89||304.82|
|Amount available for appropriation||312.25||311.16|
|Amount transferred to Reserve Fund||0.48||1.27|
|Balance carried to Balance Sheet||311.77||309.89|
The Board of Directors regret their inability to recommend any payment of dividend for the financial year 2015-16 due to inadequate profits.
YEAR IN RETROSPECT
The Company earned a gross income of Rs. 48.93 lakhs for the year ended 31 March 2016 as against Rs. 34.29 lakhs for the year ended 31 March 2015 and profit after tax was Rs. 2.36 lakhs for the year ended 31 March 2016 as against Rs. 6.34 lakhs for the year ended 31 March 2015.Your directors are optimistic for achieving better results during the current financial year by optimum utilisation of the available resources.
DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)
As per the provisions of the Section 152(6) of the Companies Act, 2013 and other applicable rules, if any, Mr. Tushar Choudhary (DIN: 00174003), the Director of the Company retires by rotation at the ensuing Annual General Meeting of the Company, and being eligible offers himself for re-appointment.
The brief resume and other details relating to the Directors, who are to be appointed/re-appointed as stipulated under Regulation 36(3) of the SEBI Listing Regulations, are provided in the Notice of Annual General Meeting forming part of the Annual Report.
Ms Aditi Ganguly (DIN: 07553943) was appointed as an Additional Director (category: Non-Executive Director) of the Company with effect from 13 August 2016 in terms of Section 161 of the Companies Act, 2013. Ms Ganguly will hold office upto the date of the ensuing Annual General Meeting of the Company, However, the Company has received notice from a member under Section 160 of the Companies Act, 2013 signifying his intention to propose Ms Ganguly to be appointed as Director of the Company, at the forth coming^ Annual General Meeting, accordingly the resolution for appointment of Ms Ganguly has been included in the notice convening the meeting.
Ms. Monika Saraswat (ACS: 29322) was appointed as the Company Secretary of the Company, with effect from 26 August 2015 based on the recommendations made by the Nomination & Remuneration Committee of the Company.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the provisions referred to in sub-section (5) of Section 134 read with sub-section (3)(c) of the Companies Act, 2013, the Board of Directors of the Company confirms that:-
(a) in the preparation of the annual accounts of the Company for the financial year ended 31 March 2016, the applicable accounting standards had been followed along with proper explanation relating to material departures;
(b) they 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 of the Company for that period;
(c) they had 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 and other irregularities;
(d) they had prepared the annual accounts on a going concern basis; and
(e) they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.
(f) they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
INDEPENDENT DIRECTORS DECLARATION
As required in terms of Section 134(3)(d) of the Companies Act, 2013, the Board confirms that all the Independent Directors of the Company have given necessary declaration of their Independence as stipulated in Section 149(6) of the Companies Act, 2013.
NOMINATION AND REMUNERATION POLICY
The Nomination and Remuneration Committee of the Company, formulated in terms of the provisions of Section 178 of the Companies Act, 2013 comprises of Mr. Vikash Kumar Patodia, Mr. Anurag Choudhary and Mr. Vipin Gupta. The Nomination and Remuneration Committee met twice in the financial year on 4 September 2015 and 30 March 2016, respectively.
The Nomination and Remuneration Committee has framed a policy relating to the appointment, remuneration, independence and removal of Executive Directors, Independent Directors, Key Managerial Personnel and Other Senior Management Personnel of the Company, in accordance with the provisions of Section 178 of the Companies Act, 2013, the same is annexed herewith and marked as Annexure I.
MEETINGS OF THE BOARD OF DIRECTORS
The Board of Directors comprises of four (4) Non-Executive Directors out of which two (2) are Independent Directors and fulfils the criteria as laid down in Section 149(4) of the Companies Act, 2013,
During the financial year under review, the Board of Directors duly met eight (8) times respectively on 29 May 2015, 13 August 2015, 3 September 2015, 8 September 2015, 13 November 2015, 15 December 2015, 13 February 2016 and 29 February 2016 and the maximum time gap in between two meetings of the Board does not exceed 120 days as required by the provisions of Section 173(1) of the Companies Act, 2013. The details of attendance of Directors at the Board meeting is given hereunder:
|SI. No.||Names of members||Status||No. of meetings attended|
|1||Mr. Anurag Choudhary||Director, Non-Executive||8|
|2||Mr. Tushar Choudhary||Director, Non-Executive||8|
|3||Mr. Vikash Kumar Patodia||Director, Non-Executive Independent||6|
|4||Mr. Vipin Gupta||Director, Non-Executive Independent||4|
The Company has an Audit Committee, Committee of Directors pursuant to section 177 of Companies Act, 2013 consisting of Three (3) Directors as members and majority of its members are Independent. The Chairman of the Audit Committee is an Independent and Non-Executive Director with over a decade of rich experience in the field of finance and accounts.
The Committee met Four (4) times during the year on 29 May 2015, 13 August 2015, 13 November 2015 and 13 February 2016 to review the periodic as well as the financial statements prior to their placement before the Auditors and the Board for their consideration. The Committee reviewed the results of operations, statement of significant Related Party Transactions (as defined by the Audit Committee) submitted by management. The composition of Audit Committee and the details of meetings attended by each of the Directors are given below:
|SI. No.||Names of members||Status||No. of meetings attended|
|1||Mr. Vikash Kumar Patodia||Chairman, Non-Executive Independent||4|
|2||Mr. Anurag Choudhary||Member, Non-Executive||4|
|3||Mr. Vipin Gupta||Member, Non- Executive Independent||4|
Terms of Reference
The terms of reference of this Committee broadly conforms to the norms laid down in Section 177 of the Companies Act, 2013 and includes among others the periodic review of the Quarterly and the Annual Accounts, assessing the adequacy of Internal Contr ols, interaction with the Statutory Auditors. The Committee provides guidance to the management in preparing of annual as well as periodical financial statements before submitting to the Board. It liaisons with the Companys Statutory Auditors. The functions of this Committee include reviewing the adequacy of audit functions, its structures and discussions with Auditors on any significant findings and follow-up therewith. The Terms of Reference of Audit Committee, inter alia, includes the following:
(i) the recommendation for appointment, remuneration and terms of appointment of auditors of the Company;
(ii) review and monitor the auditors independence and performance, and effectiveness of audit process; (Hi) examination of the financial statement and the auditors report thereon;
(iv) approval or any subsequent modification of transactions of the Company with related parties;
(v) scrutiny of inter-corporate loans and investments;
(vi) valuation of undertakings or assets of the Company, wherever it is necessary;
(vii) evaluation of internal financial controls and risk management systems;
(viii) monitoring the end use of funds raised through public offers and related matters.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
The Company has duly established a vigil mechanism and formulated Vigil Mechanism/Whistle Blower Policy for its Directors and its employees as per the provision of section 177(9) of the Companies Act, 2013 read with the Rule 7 of Companies (Meeting of the Board and its powers) Rules, 2014. The Audit Committee of Directors of the Company have been authorised to oversee the compliance of the Vigil Mechanism/Whistle Blower Policy of the Company.
The Company during the year 2015-16 has not accepted any deposits from the public within the meaning of section 73 of the Companies Act, 2013.
AUDITORS AND AUDITORS REPORT
M/s Agarwal Prasad & Co, Chartered Accountants (Firm Registration Number. 311068E), the retiring Auditors of the Company has expressed their unwillingness to be re-appointed as the Statutory Auditor of the Company at the ensuing Annual General Meeting of the Company and the Company has received special notice from one of the member pursuant to Section 115/ 140(4)(i) of the Companies Act, 2013 read with rule 23 of the Companies (Management & Administration) Rules, 2014 proposing to appoint M/s S. Jaykishan, Chartered Accountants (Firm Registration No.: 309005E) as Statutory Auditors of the Company for a period of five years. The Company has received necessary consent and declaration from the proposed Auditors to the effect that their appointment, if made, would be in accordance with the conditions specified and satisfies the Criteria as prescribed in Section 141 of the Companies Act, 2013 read with Companies (Audit and Auditors) Rules, 2014..
The Board has placed on record its deep sense of appreciation for the services rendered by M/s Agarwal Prasad & Co, Chartered Accountants during their tenure as the Auditors of the Company.
The Auditors Report and notes to financial statements are self-explanatory and therefore do not call for any further explanation.
Pursuant to provisions of Section 204 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the Board has appointed Mr. Samir Kumar Ghosh, Practicing Company Secretary, to conduct Secretarial Audit for FY 2015-16. He conducted the Secretarial Audit and the comments and observations made are given hereunder:
Observation of Secretarial Auditor
The Company could not appoint the Key Managerial Personnel, such as- Chief Financial Officer (CFO) as required under Section 203 and Woman Director under section 149 of the Companies Act, 2013,
Secretarial Audit Report for the financial year ended 31 March 2016 is given in Annexure II attached hereto and forms part of this Report.
Explanation of the Board
The management of the Company, due to the stringent financial position and poor financial performance, could not afford to appoint Woman Director and Key Managerial Personnel during the financial year 2015-16. However, the Company has appointed Ms Monika Saraswat (ACS: 29322), Company Secretary of the Company, and proposed to appoint one woman director on the Board at the ensuing Annual General Meeting of the Company and the Company is in the process of complying the other required provisions at the earliest.
EXTRACT OF THE ANNUAL RETURN
Pursuant to the provisions of Section 92(3) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, an Extract of Annual Return as on the financial year ended on 31 March 2016, in Form No. MGT-9 is appended to the Boards Report marked as Annexure III forming part of the Annual Report.
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The Company, being a non-banking finance Company registered with the Reserve Bank of India and engaged in the business of giving loans, is exempt from complying with the provisions of section 186 of the Companies Act, 2013. Accordingly, the disclosures of the loans given as required under the aforesaid section have not been given in this Report. xtT T ^
PARTICULARS OF MANAGERIAL REMUNERATION
Disclosures pertaining to remuneration and other details as necessitated and to the extent applicable to the Company pursuant to the provisions of the Section 197(12) Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration Managerial Personnel) Rules, 2014 forms part of the Boards Report as Annexure IV.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There were no material changes and commitments occurred after the close of the financial year till the date of this report, which affect the financial position of the Company.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATION IN FUTURE
There were no significant and material orders passed by any regulatory authority or courts or tribunals impacting the going concern status and Companys operation in future.
PARTICULARS OF CONTRACTS & ARRANGEMENTS WITH RELATED PARTIES
The Company has not entered into any materially significant related party transaction with the Companys Promoters, Directors, Management or their relatives, which could have a potential conflict with the interests of the Company.
All the Related Party Transactions entered into by the Company during the financial year were in ordinary course of business and on arms length basis. The Related Party Transactions were usually undertaken with prior consent of the Audit Committee on quarterly basis. There have been no materially significant related party transactions between the Company and the Directors, the management, or relatives except for those disclosed in the financial statements. Accordingly, particulars of contracts or arrangements with related parties referred to in Section 188 (1) along with the justification for entering into such contract or arrangement in Form AOC - 2 does not form part of the report.
SUB SID I ARY/JOINT VENTURE/ASSOCIATE COMPANY
The Company does not have any subsidiary/joint venture/associate Company, therefore the requirement subrule (1) of Rule 8 of Companies (Accounts) Rules, 2014 with regards to providing details on performance of the same is not applicable to the Company.
Further during FY 2016, no Company has become or ceased to be subsidiary, joint venture or associate of the Company.
RISK MANAGEMENT POLICY
The Board of Directors, at its meeting held on 27 May 2014, has adopted risk management policy for the Company which provides for identification, assessment and control of risks which in the opinion of the Board may threaten the existence of the Company. The Management identifies and controls risks through a properly defined framework in terms of the aforesaid policy.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
Since the Company has not been engaged in any manufacturing activity, the information as required in terms of clause (m) of sub-section (3) of Section 134 of the Companies Act, 2013 read with tjtp Coinpanies (Accounts) Rules, 2014 are not applicable. The foreign exchange earnings and outgo remainedfif durmjphe year under review.
Internal financial controls and risk management system
The Board has duly implemented the internal financial control and risk management system in the Company to ensure efficient implementation of the Companys strategy and effective operations, assure compliance with both internal instructions and laws and regulations, achieve appropriate financial reporting, and prevent fraud and other misconduct.
Mr. Anurag Choudhary, Director of the Company is authorised by the Board to oversee the internal financial controls and risk management system and take the necessary actions as may be required for giving effect and implementation of the said system and control.
CORPORATE SOCIAL RESPONSIBILITY
The Company is not covered under the provisions of Section 135 of the Companies Act, 2013, therefore the requirement of clause (o) of sub-section (3) of Section 134 of the said act are not applicable to the Company.
PARTICULARS OF EMPLOYEES
The details as required pursuant to provisions of sub-rule (2) and (3) of Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are not applicable, as none of the employees, either employed throughout the year or part of the financial year, was in receipt of the remuneration in excess of the limit prescribed under rules amended up to date.
MANAGEMENT DISCUSSION AND ANALYSIS
Pursuant to the Regulation 34 read with Schedule V Part B, the Management Discussion and Analysis Report forms part of this Annual Report and marked as Annexure V.
LISTING ON STOCK EXCHANGE
The Companys equity shares are listed at The Calcutta Stock Exchange Limited, During the financial year, 2015-16 Securities and Exchange Board of India (SEBI) has issued and notified SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with effect from 1 December 2015 and pursuant to Regulation 109(2), the Company is required to execute a new listing agreement with the Stock Exchange where the shares of the Company are listed, accordingly, the Company has executed the listing agreement with The Calcutta Stock Exchange on 1 December 2015. Furthermore, the Annual Listing Fees for the year 2016-17 has also been remitted.
EVALUATION OF THE BOARD, COMMITTEE AND DIRECTORS
The Board at its meeting held on February 13, 2015, evaluated its performance and that of Committees and individual directors in the manner as recommended by the Nomination and Remuneration Committee. Rating sheets were circulated to the directors for the purpose of evaluation of performance of the Board, its Committees and individual directors. A summary of performance evaluation of the Board, its Committees and individual directors was prepared on the basis of rating sheets received from the individual directors and the same was placed before the Board. And on the basis of the performance evaluation, all the members of the Board are eligible to continue to act as Directors of the Company.
Your Directors would like to place on record their appreciation for the co-operation received from the Shareholders, Bankers and Customers.
|For and on behalf of the Board|
|Tushar Choudhary||Anurag Choudhary|
|Date: 13 August 2016||(DIN: 00174003)||(DIN: 00173934)|