infinite computer solutions india ltd cash flow dividends dividends Directors report


To the Members,

The Board of Directors ("the Board") hereby submits the report on the business and operations of Infinite Computer Solutions (India) Limited ("the Company") along with the Audited Financial Statements (Standalone and Consolidated) for the Financial year ended March 31, 2021.

FINANCIAL HIGHLIGHTS

The Financial Statements of the Company are prepared in accordance with the Companies (Accounting Standards) Rules, 2006 notified under Section 133 of the Companies Act, 2013 ("the Act") and other relevant provisions of the Act. The Financial highlights for the year under review, compared with the previous Financial year, are given below:

Summary - Consolidated Financials

Rs. Million

Particulars Year ended March 31, 2021 Year ended March 31, 2020
Total Sales and Income 38,541.44 35,124.59
Total Expenses 36,176.13 33,116.88
Total Income before Tax & Depreciation 2,365.31 2,007.71
Depreciation 567.68 519.99
Profit/(Loss) before Tax (PBT) 1,797.63 1,487.72
Profit/(Loss) after Tax (PAT) 1,353.32 1,129.04

Summary - Standalone Financials

Rs. Million

Particulars Year ended March 31, 2021 Year ended March 31, 2020
Total Sales and Income 5,959.26 6,058.10
Total Expenses 5,158.84 4,881.44
Total Income before Tax & Depreciation 800.42 1,176.66
Depreciation 270.01 209.96
Profit/(Loss) before Tax (PBT) 530.41 966.70
Profit/(Loss) after Tax (PAT) 614.15 732.65

COMPANYS PERFORMANCE

On a Consolidated basis, the revenue for FY 2020-21 was t 38,541.44 Million which was increased by 9.73% in comparison to the previous year. Net Profit before tax was t 1,797.63 Million (previous year t 1,487.72 Million) and Net Profit after tax was t 1,353.32 Million (previous year t 1,129.04 Million), which increased by 19.86 % over the previous year.

On a standalone basis, the revenue for FY 2020-21 was t 5,959.26 Million (previous year 6,058.10 Million). Profit before tax was t 530.41 Million and Net Profit after tax was t 614.15 Million.

CHANGES IN THE NATURE OF BUSINESS

During the Financial year ended March 31, 2021, there has been no material change in the nature of the business of the Company.

SHARE CAPITAL

The Authorized Capital of the Company as on March 31, 2021 was t 500 million divided into 50,000,000 (Fifty Million Only) Equity Shares of t 10 (Rupees Ten only) each.

The Issued and Paid-up Capital of the Company as on March 31, 2021 stood at t 333.56 million divided into 33,355,514/- (Thirty-Three Million Three Hundred Fifty-Five Thousand Five Hundred Fourteen Only) equity shares of t 10 (Rupees Ten only) each.

During the year under review, the Company has not issued any shares, nor granted any stock option or equity shares with differential voting rights.

DIVIDEND

In order to conserve resources and keeping in view future strategic initiatives, the Board has not recommended any dividend on the equity shares for the FY ended March 31, 2021

TRANSFER TO GENERAL RESERVES

No amount is proposed to be transferred to the General Reserve.

DEPOSITS

Your Company has not accepted any deposits within the meaning of section 73 and 74 of the Act read with Companies (Acceptance of Deposits) Rules, 2014 during the year under review.

SUBSIDIARY COMPANIES, ASSOCIATES AND JOINT VENTURES

At the beginning of the financial year, the Company had 19 direct subsidiaries (wholly owned) and 2 step-down subsidiaries (wholly owned). During FY 2020-21, the Company has closed its subsidiary company in China. Further, the wholly owned subsidiary company in USA namely Infinite Company Solutions Inc. acquired 100% stake in Pioneer Holdbull Inc, a Company incorporated in USA, w.e.f. Jan 1, 2021, to make the later as its wholly owned subsidiary. The name Pioneer Holdbull Inc was later changed to Infinite Talent Inc.in July 2021.

As on March 31, 2021, the Company has 21 subsidiaries including 18 direct subsidiaries (wholly owned) and 3 step-down subsidiaries (wholly owned).

There has been no material change in the nature of the business of the subsidiaries.

The Company has one Associate Company, namely MC Data Services Private Limited. The Company does not have any Joint Venture.

Additional investments in subsidiaries / associates, as applicable, have been adequately disclosed in the Financial Statements.

The annual accounts of the subsidiary companies are available for inspection of the Members at the registered office of the Company during normal business hours by giving an advance notice of atleast 2 working days. A copy of the same shall be provided to a member upon request.

Pursuant to the provisions of Section 129(3) of the Act, a statement containing the salient features of Financial Statements of the Companys subsidiaries in Form AOC-1 forms part of the Financial Statements of the Company.

EXTRACT OF ANNUAL RETURN

Pursuant to the provisions of section 92(3) of the Act read with Section 134(3)(a) of the Act, the Annual Return as on March 31, 2021 is available on the Companys website at the link: https://www.infinite.com/annual-return.

ONGOING SCHEME OF ARRANGEMENT

During the year the Company (as "Transferee Company") has entered into a Scheme of Arrangement ("Scheme") with two Promoter Group entities namely MC Data Systems Private Limited ("Transferor Company 1") and Inswell IT Applications Private Limited ("Transferor Company 2").

This Scheme is being undertaken as part of the restructuring plan to simplify the holding structure through consolidation and to reduce the paid-up share capital of the Transferee Company held by the Relevant Shareholders (who are the remaining Public shareholders).

As per the Scheme, the Transferor Company 1 and Transferor Company 2 will merge into the Company subject to approvals of shareholders and other regulatory approvals.

The Company shares were delisted in the year 2018. Post delisting, the Companys equity shares cannot be traded on any of the stock exchanges in India and hence, the remaining public shareholders do not have many avenues to monetize or liquidate their shareholding. The Scheme provides liquidity and exit route to these public shareholders in a fair and transparent manner by way of reduction of capital.

Upon First Motion Application filed by the Company, the National Company Law Tribunal, Chandigarh Bench has vide order dated August 04, 2021 directed for calling of a meeting of equity shareholders of the Company via Video Conferencing / Other Audio-Visual Means on September 25, 2021. The Company is in the process of intimating the shareholders about such a meeting. The shareholders of the Company are requested to vote in favour of the ongoing scheme in their own interest.

CHANGE OF THE REGISTERED OFFICE

Pursuant to approval obtained from the members on November 24, 2019, via Postal Ballot process and approval obtained from the Regional Director, Northern Region, Ministry of Corporate Affairs on September 24, 2020, the Company has shifted its registered office from NCT of Delhi to the State of Haryana for administrative convenience and better control.

Effective from October 09, 2020, the new registered office address of the Company shall be as follows:

4th Floor, Plot No. 21, Institutional Area, Sector 44, Gurugram - 122001, Haryana, India

NUMBER OF MEETINGS OF THE BOARD

The Board met seven (6) times during the Financial year on the following dates: August 18, 2020, August 28, 2020, November 20, 2020, December 21, 2020, December 24, 2020 and March 17, 2021.

The maximum interval between any two meetings did not exceed the maximum time prescribed under the Act.

NOMINATION AND REMUNERATION POLICY

The Board has upon recommendation of the Nomination and Remuneration Committee, framed a Nomination and Remuneration Policy ("NRC Policy"). The salient features of NRC Policy are:

a. The NRC Policy prescribes the criteria for determining qualifications, competencies, positive attributes and independence for the appointment of a Director (executive / non-executive), Key Managerial Personnel ("KMP"), Senior Management and other Employees.

b. The NRC Policy states the procedure determining the tenure of Director, KMP, Senior Management and other Employees and also for removal and retirement of them.

c. The NRC Policy prescribes the criteria for determining their remuneration of Directors, KMP, Senior Management and other Employees.

d. The NRC Policy mentions the criteria for evaluation of the performance of Independent and Non-Independent Directors and Executive Directors.

e. The Board of Directors may review and amend the NRC Policy upon recommendations from the Nomination & Remuneration Committee.

There is no change in the NRC Policy of the Company during the last Financial year. The updated NRC Policy is also available on our website at https://www.infinite.com/policy/nrc.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Following events have happened during the Financial year under review till date:

i. Mr. Upinder Zutshi resigned and stepped down from the position of Managing Director and Chief Executive Officer effective from April 10, 2020 and now he continues as a Non-Executive Director on the Board.

ii. As per the provisions of the Act, Mr. Sanjay Govil, being the longest serving Director and who is liable to retire at this AGM, being eligible, seeks re-appointment. The Board recommends his re-appointment and the resolution seeking shareholders approval for his re-appointment forms part of the Notice of the ensuing AGM.

At the year ended March 31, 2021, the Board composition comprised of one Non-Executive Promoter Chairman, One Non-Executive Director, One Executive Director, and three Independent Directors including a Woman Director.

Changes in KMP

During the FY under review, Mr. Upinder Zutshi stepped down from the position of Managing Director & CEO of the Company. In order to fill the vacant Key Managerial Personnel ("KMP") position, upon recommendation of the Nomination and Remuneration Committee, the Board of Directors of the Company appointed Mr. Ujjwal Vats as Manager of the Company in accordance with the position of section 203 of the Companies Act, 2013 subject to the approval of the members of the Company. The Board of Directors of the Company recommends the appointment of Mr. Ujjwal Vats as Manager at the ensuing AGM.

The KMP of the Company as on March 31, 2021 were:

• Mr. Sanjeev Gulati, Director & Chief Financial Officer,

• Mr. Ujjwal Vats, Manager, and

• Mr. Saurabh Madaan, Company Secretary

During the year under review, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board/Committee of the Company.

Independent Directors

During the year, your Company has received declarations from all the Independent Directors confirming that they meet the criteria of Independence as provided under the provisions of the Act and the Rules framed thereunder. In the opinion of the Board, the Independent Directors are independent of the management and have the integrity, expertise and experience required for appointed as such.

Further, all the Independent Directors are registered in the online data bank maintained by the Ministry of Corporate Affairs and the Indian Institute of Corporate Affairs.

COMMITTEES OF THE BOARD

As on March 31, 2021, the Board had four committees, Audit Committee, Nomination and Remuneration Committee, Corporate Social Responsibility Committee and Stakeholders Relationship Committee.

Audit Committee

As on March 31, 2021, the Audit Committee comprised of 3 Independent Directors namely:

i. Mr. Ravindra R Turaga - Chairman;

ii. Mr. Ashok Kumar Garg; and

iii. Mrs. Sadhana Dikshit

The Company Secretary acts as the Secretary to the Audit Committee.

The Committee works in accordance with the terms of reference as stipulated by the Board in accordance with the provisions of the Act. During the year, the Board accepted all recommendations made by the Audit Committee.

DIRECTORS RESPONSIBILITY STATEMENT

In compliance with section 134(3)(c) of the Act, your Directors confirm that:

i. in the preparation of the annual accounts for the Financial year ended March 31, 2021, the applicable accounting standards have been followed, along with proper explanation relating to material departures;

ii. they 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;

iii. they have taken proper and sufficient care 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;

iv. they have prepared the annual accounts of the Company for the Financial Year ended on March 31, 2021 on a going concern basis;

v. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

INTERNAL CONTROL SYSTEMS AND ITS ADEQUACY

The Board of your Company is responsible for establishing and maintaining adequate financial controls as per the provisions of section 134 of the Act. The Board has laid down policies and processes in respect of internal financial controls and ensures the controls to be adequate and operating efficiently.

These controls cover the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business including adherence to the Companys policies, safeguarding of its assets of the Company, prevention and detection of its frauds and errors, accuracy and completeness of accounting records and timely preparation of reliable financial information.

The Company has an internal control system, commensurate with the size, scale and complexity of its operation. The scope and authority of the Internal Audit function is clearly defined by the Audit Committee of the Board. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee. The Internal Auditors monitors and evaluates the efficacy and adequacy of the internal control system of the Company, its compliance with applicable laws/ regulations, accounting procedures and policies. Based on the report of the Internal Auditors, corrective action is undertaken and thereby strengthens the controls. Significant audit observations and action plans are presented to the Audit Committee of the Board on quarterly basis.

AUDIT & AUDITORS REPORT

Statutory Audit

M/s. HDSG & Associates, Chartered Accountants, New Delhi were appointed as the Statutory Auditors of your Company in the AGM held on September 28, 2017 for a term of five years until the conclusion of the Twenty Third AGM of the Company to be held in the year 2022. The requirement to place the matter relating to appointment of auditors for ratification by members at every AGM has been done away by the Companies (Amendment) Act, 2017 with effect from May 7, 2018. Accordingly, no resolution has been proposed for ratification of appointment of statutory auditors at the ensuing AGM.

The Auditors Report read along with notes to accounts is self-explanatory and therefore does not call for further comments. The Auditors Report does not contain any qualification, reservation or adverse remark.

Secretarial Audit

Your Company had appointed M/s. BMP & Co. LLP (LLPIN: AAI-4194), Company Secretaries, Bangalore to conduct a Secretarial Audit of your Company for the financial year 2020-21.

The Secretarial Audit Report is enclosed herewith as Annexure A to this Annual Report. It does not contain any adverse remarks or qualifications.

Cost Records And Cost Audit

Provisions related to maintenance of Cost Records and requirement of Cost Audit as prescribed under the provisions of Section 148(1) of the Act are not applicable for the business activities carried out by the Company.

RISK MANAGEMENT POLICY

The Company has established a Risk Management Policy which sets out the Companys principles and processes with regard to identification, analysis and management of applicable risks. The Policy helps to identify, evaluate business risks and opportunities. The Policy mandates the ways in which respective risks are expected to be mitigated and monitored.

CORPORATE SOCIAL RESPONSIBILITY ("CSR") INITIATIVES

The brief outline of the CSR Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year under review along with other necessary details are set out in Annexure B of this report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended.

The Company has a CSR Committee comprising of a majority of Independent Directors. The CSR Policy of the Company is available on our website at https://www.infinite.com/policv/csr.

PARTICULARS OF EMPLOYEES

The information pursuant to section 197(12) of the Act read with the provisions of Rule 5(2) of Chapter XIII viz. The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided as Annexure C to this report.

PERFORMANCE EVALUATION OF THE BOARD, ITS COMMITTEES & DIRECTORS

During the year, pursuant to the provisions of the Act, following evaluations were carried out:

i. The members of Nomination and Remuneration Committee carried out an annual evaluation of each Directors performance;

ii. The Board of Directors in the meeting carried out an annual evaluation of the Board Committees; and

iii. In a separate meeting, the Independent Directors evaluated the performance of Non-Independent Directors i.e. Executive Directors, the Board as a whole and the Chairman of the Company.

The evaluation process was based on the criteria mentioned in the given questionnaires, which set the broad parameters for appraisal of each Director, the Board and its Committees. The detailed questionnaires are designed in such a way to keep different point of views for each evaluation.

RELATED PARTY TRANSACTIONS

During the year under review, transactions entered into with related parties during the financial year were in the ordinary course of business and at arms length basis and were approved by the Audit Committee. No Material Related Party Transactions, i.e. transactions exceeding 10% of the annual Consolidated turnover as per the last audited Financial statement, were entered during the year by your Company. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Act in Form AOC-2 is not applicable.

Further, the detailed disclosure on related parties and transactions done with them during the year forms part of Notes to the Financial Statements.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE ACT

The particulars of Loans, Guarantees or Investments under section 186 of the Act have been disclosed in Notes to the Financial Statements.

INVESTOR EDUCATION AND PROTECTION FUND ("IEPF")

Section 124 of the Act read with Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("the IEPF Rules"), requires the Companies to transfer dividend that has remained unclaimed for a period of seven years from the unpaid dividend account to the IEPF. Further, the IEPF Rules require that the shares on which dividend has not been paid or claimed for seven consecutive years or more be transferred to the demat account of the I EPF Authority.

The Company sends periodic intimation to the shareholders, advising them to lodge their claims with respect to unclaimed dividends and shares. During the year, the Company transferred the following amounts to IEPF:

Amount in Rs..

FY Type of Dividend Date of declaration Date of Transfer to IEPF Amount transferred to IEPF
2012-13 Final Dividend August 30, 2013 October 29, 2020 184,020/-
2013-14 Interim Dividend February 10, 2014 April 09, 2021 92,000/-

Shareholders may note that both the unclaimed dividend and corresponding shares transferred to IEPF, including all benefits accruing on such shares, if any, can be claimed from IEPF following the procedure prescribed in the IEPF Rules. No claim shall lie in respect thereof with the Company.

Further, the below table mentions the dividend which shall be eligible to be transferred to IEPF on the below given date:

FY Type of Dividend Date of declaration Due date of Transfer to IEPF
2013-14 Final Dividend September 24, 2014 November 23, 2021

MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE Company

There has been no material change in the nature of business 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.

SIGNIFICANT / MATERIAL ORDERS PASSED BY THE REGULATORS

There were no significant/material orders passed by any of the Regulators or Courts or Tribunals impacting the going concern status of the Company and its operations in the future.

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

Conservation of Energy

The operations of the Company are not energy intensive. However, steps taken by the Company to conserve energy on a perpetual basis include ensuring procurement of energy saving devices and systems. The endeavor is to identify opportunities for energy saving in the areas like air-conditioning systems, indoor environment quality improvement, electrical systems, fire-fighting systems, data centers etc. For water conservation, the Company follows the approach of rainwater harvesting which helps the environment to augment the capacity to recharge the groundwater.

Technology Absorption

The Company does not have any technical collaboration arrangements with any business partners; the issue of absorption of such technologies, therefore, does not arise.

Foreign Exchange Earnings and Outgo

Rs. Million

Foreign Exchange earnings and outgo FY 2020-21 FY 2019-20
Foreign exchange earnings 2,502.58 2,772.38
Expenditure in foreign currency 32.99 130.29

SECRETARIAL STANDARDS

The Company has complied with applicable mandatory Secretarial Standards issued by the Institute of Company Secretaries of India.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

Your Company has established a vigil mechanism and formulated a Whistle Blower Policy as per the provisions of section 177 of the Act. The policy provides the framework and processes through which the employees and Directors can express their genuine concerns. It also provides adequate safeguards against victimization of employees and Directors against any kind of discrimination, harassment or any unfair practice being adopted against them.

During the year under review, no employee was denied access to the Chairman of the Audit Committee. No complaints were received under Vigil Mechanism & Whistle Blower Policy during the financial year 2020-21.

The Whistle Blower Policy as adopted by the Company can be accessed through the following link: https://www.infinite.com/policy/whistle-blower.

DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

The Company has in place, a policy on prevention, prohibition and redressal of sexual harassment at the workplace and has a duly constituted Internal Complaints Committee in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("the Act") and the Rules thereunder. The Company is committed to provide and promote safe, healthy and congenial atmosphere irrespective of gender, caste, creed or social class of the employees. During the year, the Company did not receive any complaints under the said Act.

OTHER DISCLOSURES

The Statutory Auditors of the Company have not reported incidents related to fraud during the financial year to the Audit Committee or Board of Directors under section 143(12) of the Act.

Acknowledgements

Your Directors place on record their sincere thanks to our clients, partners, vendors, bankers, business associates, consultants, and various Government Authorities for their continued support extended to your Company during the year under review. Your Directors also acknowledge the grateful support and confidence of the shareholders reposed in the Company and look forward the same in the future.

For and on behalf of the Board of Directors

Sd/- Sd/-
Sanjeev Gulati Ravindra Ramarao Turaga
Director & CFO Director
DIN: 00031711 DIN: 01687662
August 05, 2021