ICDS Ltd Directors Report.
Your Board of Directors have pleasure in presenting their 48th Annual Report on the business and operations of the Company and the accounts for the Financial Year ended March 31,2019.
The following table brings out the financial performance of the Company during the F.Y. 2018-19:
(Rs. in 000)
|Income from Operations||2,77,84||6,09,06|
|Less: Operating Expenses||1,99,68||1,62,92|
|Less: Fair value loss on Investments||3,17,61||18,14|
|Profit/(loss) before Depreciation||(1,69,66)||4,89,49|
|Profit after Depreciation before Tax||(1,82,31)||4,77,44|
|Less: Provision for Income Tax||1,43||1,17,10|
|Profit/(Loss) after Tax||(1,83,74)||3,60,34|
|Opening balance of retained earnings||5,19,04||1,62,58|
|Profit / (loss) for the year[a]||(1,83,74)||3,60,34|
|Other comprehensive income/(loss) [b]||(3,67)||(3,88)|
|Total comprehensive income/(loss) [a+b]||(1,87,41)||3,56,46|
|Closing balance of retained earnings||3,31,63||5,19,04|
COMPANIES STATE OF AFFAIRS:
During the year under review the Company has earned income of Rs. 3,50,69 thousand as against Rs. 6,73,90 thousand in the corresponding previous year. The income for the current year is not comparable with that of the previous year due to the fact that the Previous Year income included sale of telephone handsets and accessories and the reduction of stock in trade comprising of shares to the extent of Rs. 3,38,26 thousand. The income for the year basically consists of recovery of dues, commission from Insurance related activities, dividend and interest. The operating expense for the year is Rs. 1,99,68 thousand as against Rs. 1,62,92 thousand in the previous year. The provision for the fair value of investments (reduction in the value of investments is Rs. 3,17,61 thousand as against Rs. 18,14 thousand in the previous year. The profit/(loss) after tax for the year after adjusting the provision stands at Rs. (1,83,74) thousand as against Rs. 3,60,34 thousand in the Previous year. On account of the losses incurred during the year there is erosion in the net worth of the company. The Net worth of the company as at March 31, 2019 stands at Rs. 19,67,64 thousand as against Rs. 21,55,05 thousandas at March 31,2018.
FUTURE BUSINESS PLANS:
The Company has stopped NBFC business subsequent to the filing of scheme of arrangement with the Honble High Court of Karnataka Bangalore. As the Company had repaid the entire public liabilities (subject to Note No. 23(a) of the financials) has applied for fresh Certificate of Registration (COR) with Reserve Bank of India, as Non deposit taking NBFC. Reserve Bank of India has made certain suggestions most of which the Company has complied with and requested Reserve Bank of India to issue the COR with the assurance that the other suggestions will be implemented post issuance of COR. Reserve Bank of India vide its letter dated 26th December, 2018, informed the company that the companys request for the COR has been rejected and advised the company to approach the Appellate Authority for redressal of grievances if any. The company accordingly has filed an application before the Appellate Authority and the same is presently pending with the said authority.
LISTING OF COMPANYS SHARES IN NSE & BSE:
The Company shares were listed in BSE and NSE. The trading in shares were suspended by BSE in the year 1999 and by NSE in 2002. The Company started pursuing removal of suspension of trading in both the Stock Exchanges for the last few years by visiting the Stock Exchanges in person and through consultants. The Company has been putting in its best efforts to get the suspension revoked at the earliest and we are hopeful of getting suspension revoked shortly.
FEE BASED ACTIVITIES
In order to generate some income to partly meet the establishment expenses, your Company is engaged as Corporate Agent for Life and General Insurance Companies. The company is also focusing on collecting over dues from HP/Lease/Loans/Bills discounted portfolios.
TRANSFER TO RESERVES
The Company has not transferred any amount to reserves during the financial year.
In view of the losses incurred during the year and in order to conserve the resources for future business your directors expressed their inability to recommend dividend during the year under report.
The paid up Share Capital as on 31st March, 2019 was Rs. 13,02,67 thousand. During the year under review, the Company has not issued any shares and also has not issued shares with differential voting rights. It has neither issued employee stock options nor sweat equity shares and does not have any scheme to fund its employees to purchase the shares of the Company. DEpOSITS:
The Company has not accepted any deposits from the public/ shareholders during the year under review as per Section 73 of the Companies Act, 2013.
Pursuant to the Regulation 34(3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Corporate Governance Report and Auditors Certificate regarding Compliance of conditions of Governance are made a part of this Report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Change in Directors
Mr. H. N. S. Rao (DIN 00106953) and Mr. K. M. Udupa (DIN 00104309) resigned from the Board owing to personal reasons. Board wishes to place on records its appreciation of valuable services rendered by both of them during their tenure as Directors. Mr. T Mohandas Pai, [DIN 00104336] Chairman and Director retire by rotation at the forthcoming Annual General Meeting and being eligible, offer himself for reappointment.
Mr. T Sachin Pai (DIN 00795780) Mr. Sujir Prabhakar (DIN 02577488) were appointed as additional Directors on the Board of the Company. They continued to be Directors till the date of forthcoming Annual General Meeting. Company has received notice from members proposing them to the position of Directors at the meeting.
Mrs. Vimal C. Kamath (DIN 07182821) and Mr. Sujir Prabhakar (DIN 02577488) were appointed as Independent Directors of the Company subject to approval of the members in the ensuing annual general meeting.
Mr. Bharath Krishna Nayak (00776729) resigned from the post of Independent Director and appointed as Managing Director of the Company subject to approval of the members in the ensuing annual general meeting.
Details of remuneration paid to the Directors and Key Managerial Personnel are given in the Form MGT-9 which is available in the Companys website www.icdslimited.com (link: http://www . icdslimited.com/sites/default/files/ICDS_MGT-9%20Extract%20 of%20Annual%20Return%202019.pdf).
A brief profile of the Directors seeking confirmation/appointment, nature of expertise in specific functional area, name of other public companies in which he/she holds directorship and membership/chairmanship of the committees of the Board of Directors and the particulars of the shareholding as stipulated under Regulation 36(3) of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 and Secretarial Standards 2 (SS 2 on General Meetings) is appended to the Notice.
DECLARATION BY INDEPENDENT DIRECTORS
The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under the Companies Act, 2013 and Regulations of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.
A calendar of Meetings is prepared and circulated in advance to the Directors. During the year five Board Meetings were convened and held on 29.05.2018, 08.08.2018, 05.11.2018, 05.12.2018, 13.02.2019. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.
The Audit Committee comprises independent directors namely Mr. Sujir Prabhakar, (Chairman), Mr. Airody Giridhar Pai and Mr. U. Harish P. Shenoy as other members. All the recommendations made by the Audit Committee were accepted by the Board. Details of Audit Committee meetings are enumerated in the Corporate Governance Report.
The role and terms of reference of Audit Committee cover the areas mentioned in Regulation 72 of the SEBI (Listing Obligation & Disclosure Requirements) Regulations, 2015 and Section 179 of the Companies Act, 2013, besides other terms referred to by the Board of Directors from time to time. During the year, the Committee met on 29.05.2018, 08.08.2018, 05.11.2018 and 13.02.2019.
REPORT ON CORPORATE SOCIAL RESPONSIBILITY (CSR) INITIATIVES OF THE COMPANY
The Company has not developed and implemented any Corporate Social Responsibility initiatives as per the provisions of Section 135(1) of the Companies Act, 2013 as the said provisions are not applicable to the Company for the time being.
PARTICULARS OF EMPLOYEES
During the year under review, the Company had no employees whose remuneration exceeded the limit prescribed under Section 197 of the Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and subsequent amendments thereto. Particulars of top ten employees of the Company in terms of remuneration drawn during the year 2018-19 presented as an annexure to the Board Report during the Board Meeting is preserved separately and the same will be made available to any shareholders on request made to the company in writing.
Your Company recognizes that risk is an integral part of business and is committed to managing the risks in a proactive and efficient manner.
Your Company through its risk management process strives to contain impact and likelihood of the risks from time to time.
The Consolidated Financial Statements of the Company and its subsidiary Manipal Properties Limited, prepared in accordance with Indian Accounting Standard issued by the Institute of Chartered Accountants of India, form part of the Annual Report and are reflected in the Consolidated Financial Statements of the Company.
The Annual Accounts of the subsidiary company and related detailed information will be kept at the Registered Office of the Company, as also at the registered offices of the subsidiary company and will be available to investors seeking information at any time.
Salient features of financial statements of subsidiary company pursuant to Section 129(3) of the Companies Act, 2013 have been covered in the Financial Statements in Form AOC-1.
RELATED PARTY TRANSACTION:
All related party transactions that were entered into were on an arms length basis, in the ordinary course of business and were in compliance with the applicable provisions of Companies Act, 2013 ("the Act"). There were no materially significant related party transactions made by the Company during the year that would have required shareholders approval under the provisions of the Act. Details of the transactions with related parties are provided in the Note No. 38 of accompanying standalone financial statements. Form AOC-2 pursuant to Clause (h) of sub-section (3) of Section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014 is annexed herewith marked as Annexure I.
Pursuant to the provisions of Companies Act, 2013 and SEBI (LODR) Regulations, 2015, Board has carried out an annual performance evaluation of its own performance and the Directors individually. The manner in which the evaluation has been carried out are detailed below:
The performance evaluation of Chairman and Non Independent Directors was carried out by the Independent Directors. The Independent Directors evaluated the parameters viz., level of engagement, duties, responsibilities, performance, obligations and governance safeguarding the interest of the Company. The performance evaluation of Independent directors was carried out by the entire Board.
Pursuant to the provisions of the Companies Act, 2013, the Company at its 46th AGM held on 25th September, 2017 had appointed M/s Pathak H D & Associates, Chartered Accountants, Mumbai (FRN: 107783W) as the Statutory Auditors of the Company for period of five years till the conclusion of the 51st annual general meeting to be held in the year 2022.
Auditors report does not contain any qualifications, reservations or adverse remarks.
SECRETARIAL AUDIT REPORT
In terms of Section 204 of the Act and Rules made there under, CS. Shrinivas M. Devadiga, Practicing Company Secretary (Membership No. 22381 CoP No.10372) from Bangalore has been appointed as Secretarial Auditor of the Company. The report of the Secretarial Auditor is enclosed as Annexure II to this report. Secretarial Auditors Report does not contain any qualifications, reservations or adverse remarks. However, in respect of the comments made by the Secretarial Auditor in the Report with respect to show cause notice issued by the Registrar of Companies, Karnataka, the necessary explanation given by the Directors under Note Nos. 35(c) and 36(c) of the Notes to Standalone Financial Statement and Consolidated Financial Statement respectively are self explanatory.
INTERNAL FINANCIAL CONTROL
The Company has implemented and evaluated the Internal Financial Controls which provide a reasonable assurance in respect of providing financial and operational information complying with applicable statutes and policies safeguarding of assets prevention and detection of frauds, accuracy and completeness of accounting records. The Company has appointed Internal Auditor with dedicated internal audit team. The Internal Audit Reports were reviewed periodically by the Audit Committee. Further the Audit Committee annually reviews the effectiveness of the Companys internal control system. The Directors and Management confirm that the Internal Financial Controls (IFC) and adequate with respect to the operations of the Company. A report of Auditors pursuant to Section 143(3)(i) of the Companies Act, 2013 certifying the adequacy of Internal Financial Controls is annexed with the Auditors Report.
EXTRACT OF ANNUAL RETURN
As required pursuant to Section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of annual return in MGT 9 is available on the Companys website www.icdslimited.com (link: http://www.icdslimited.com/sites/default/files/ICDS_ MGT-9%20Extract%20of%20Annual%20Return%202019.pdf) Material changes and commitments, if any, affecting the financial position of the company which has 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 such material changes to be reported in this regard.
Change in nature of Business:
There is no change in nature of business.
Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and companys operations in future:
Your Directors wish to state that there have been no significant or material orders that were passed by the Regulators or Courts or Tribunals which may impact the going concern status and operations of the Company in future.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186:
Details of Loans: Nil
Details of Guarantee/Security Provided: Company has not provided any guarantee/Security during the financial year. Investments made are of the nature quoted/unquoted equity shares and investment in property. Particulars of such investments are provided in the financial statements vide Note No. 10.
OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
In order to prevent sexual harassment of Women at work place, a new Act The Sexual Harassment of Women at Work Place (Prevention, Prohibition & Redressal) Act, 2013 has been notified on 9th December, 2013. In terms of the said Act, Your Company has constituted an Internal Complaints Committee to look into complaints of sexual harassment at work place of any women employee. The company has adopted a policy for prevention of sexual harassment of women at work place and has set up internal committee for implementation of the said policy. During the year, your Company has not received any complaint of sexual harassment of any women employee.
The following is a summary of sexual harassment complaints received and disposed off during the year 2018-19:
|a. No. of complaints received :||Nil|
|b. No. of complaints disposed off :||Nil|
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The company did not have any activity in relation to conservation of energy or technology absorption. The company had no foreign exchange earnings or outgoings during the year under report.
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, which is a part of this report and is also available on website www.icdslimited.com
DIRECTORS RESPONSIBILITY STATEMENT
Your Directors hereby report in terms of Clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, that:
(a) in the preparation of the annual accounts, the applicable Indian accounting standards have been followed along with proper explanation relating to material departures;
(b) the directors have 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;
(c) 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 and other irregularities;
(d) the directors have prepared the annual accounts on a going concern basis; and
(e) the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND
Pursuant to the provisions of the Investor Education Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the Company has already filed the necessary form and uploaded the details of unpaid and unclaimed amounts lying with the Company, as on the date of last AGM (i.e. 25.09.2018), with the Ministry of Corporate Affairs. The Company has since transferred the unclaimed amounts under the Scheme of Arrangement to IEPF, subject to Note No. 23 (a) of the Balance Sheet.
DETAILS OF FRAUD REPORT BY AUDITOR:
As per auditors report, no fraud u/s 143(12) reported by the auditor.
The Company has a Whistle Blower Policy for Directors and employees and adopted the Whistle Blower Policy in terms of Section 177 (9) and (10) of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 to report genuine concerns, if any about unethical behavior, wrongful conduct and violation of Companys code of conduct or ethics. The Whistle Blower Policy is available on the Companys website: www.icdslimited.com .
Your Directors wish to place on record their appreciation of the services and co-operation extended by our Bankers, Investors and Members of Staff of the Company, during the year under report. Your directors also wish to thank the shareholders for their support.
Your directors also wish to place on record their deep sense of appreciation of the services rendered by the staff members at all levels.
For and on behalf of the Board of Directors
|(T. Mohandas Pai)|
|Place : Manipal||Chairman|
|Date : 28.05.2019||(DIN-00104336)|