Inter Globe Finance Ltd Directors Report.

Your Directors are pleased to present the26th Annual Report together with Audited Accounts of your Company for the Financial year ended March 31st,2019.

1. FINANCIAL RESULTS :

The summarized Standalone Financial performance of your Company is as below:

(Rs.in lakhs)

Particulars

Standalone

2018-19 2017-18
Profit Before Tax 46.54 (136.49)
Less : Current Taxes 49.50 26.68
Deferred Tax (3.35) (18.99)
Tax for earlier Year 29.36
Profit for the year 29.75 (144.18)
Add : Balance in Profit & Loss Account (37.42) 103.75
Less : Appropriation :
Transfer to General Reserve
Proposed Dividend
Tax on Dividend of earlier year (1.15)
Other Income Tax (Extra-ordinary Item)
Transfer to Statutory Reserve 11.65
Provision for Standard Assets 0.69 4.16
Closing Balance (20.02) (37.42)

2. SHARE CAPITAL

The paid-up Equity Share Capital of the Company on 31st March, 2019 was Rs.682.23 Lacs.

3. DIVIDEND

No dividend was recommended by the Board for the FY 2018-19.

4. OPERATIONAL REVIEW

During the current Financial year ended 31.03.2019, the Companys total turnover amounted to Rs. 13.83 Crores in comparison to Rs. 18.96 Crores in the previous Financial year 2017-18.

The total interest earned during FY 2018-2019 was Rs. 8.05 Crores in comparison to Rs. 8.40 Crores in FY 2017-2018.

The Company earned a Profit of Rs. 1.83 crores before Provision for Doubtful Debts of Rs. 1.37 crores pertaining to managementss decision to provide fully for unsecured doubtful debts.

5. FUTURE PROSPECTS

The company is making e3orts continuously to improve its business operations. In view of the above, prospects of the Company appear bright in the near future.

6. EXTRACT OF THE ANNUAL RETURN

As required by Section 92(3) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure-B to this Report.

7. NUMBER OF BOARD MEETINGS

10 meetings of the board were held during the year. For details of the meetings of the board, please refer tothe Corporate Governance report, which forms part of this report.

8. DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with Section 152(6) of The Companies Act, 2013 and the Articles of Association of the Company, Mr. Anirban Dutta, Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible o3ers himself for re-appointment.

None of the Directors of the company are disqualified as per section 164 of the Companies Act 2013. The directors have made necessary disclosures as required under various provisions of the Act and SEBI (Listing Obligations & Disclosure Requirements), Regulations, 2015.

Further,pursuant to the Provisions of Section 203 of the Companies Act 2013, the Key Managerial Personnel of the Company are -Mr. Navin Jain-Chairman & Managing Director, Mr. Anirban Dutta-Chief Financial Offcerand Ms. Pritha Dhandhania-Company Secretary.

9. DIRECTORS RESPONSIBILITY STATEMENT

The Directors Responsibility Statement referred to in clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, states that—

(a) In the preparation of the annual accounts for the Financial year ended March 31, 2019, the applicable accounting standards had 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 a3airs of the company as on 31st March, 2019 and of the Profit of your company for the year ended on that date;

(c) The directors have taken proper and su3cient 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 for the Financial year ended March 31, 2019 on a going concern basis.

(e) The directors have laid down internal Financial controls to be followed by the company and that such internal Financial controls are adequate and were operating effectively.

(f) 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.

10. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 the Board has carried out the annual performance evaluation of its own performance, the Directors individually including the Chairman of the Board as well as the evaluation of the Committees of the Board. A structured questionnaire was prepared after taking into consideration inputs received from the Directors. The performance evaluation of the Independent Directors was also carried out by the entire Board. The results of the evaluation done by Independent Directors were reported to the Chairman of the Board. It was reported that the performance evaluation of the Board, Committee etc. was satisfactory. The Directors expressed their satisfaction over the evaluation process.

11. PARTICULARS OF LOANS, GUARANTEES, INVESTMENTS OR SECURITIES

Your Company is exempted from the applicability of the provisions of Sec.186 of the Companies Act, 2013 (Act) read with Rule 11 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Companies (Meetings of Board and its Powers) Amendment Rules, 2015 as your Company is engaged in the business of Long term 3nancing and meeting the credit needs of its Customers.

12. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All the related party transactions of your Company are entered at arms length basis and are in compliance with the applicable provisions of the Companies Act, 2013 and SEBI Listing Regulations, 2015. There are no materially signi3cant transactions made by the Company with the Promoters, Directors or Key Managerial Personnel (KMPs) which have potential con3ict with the interest of your Company at large. Members may refer to the notes to Financial statements for details of related party transactions.

All related party transactions entered into by your Company were in the ordinary course of business and were on arms length basis.

Moreover, your Company had also obtained shareholders approval in AGM last year for entering into any contacts or arrangements with Related parties.

A Related Party Policy has been devised by your company for determining the materiality of transactions with related parties and dealings with them. The said policy is available on your Companys website www.Ig3.co.in.

13. MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY.

The Income Tax Department had raised a Demand on 28/12/2017 of Rs. 11,50,26,210/- on your Company pertaining to AY-2010-2011. Subsequently the Company had 3led an appeal before the HonbleCIT(A), Kolkata.

The matter is still pending before the HonbleCIT(A). A suite 3led by M/s. M.S. Shoes before Honble Delhi High Court was settled by the Company as the Board decided it was prudent to settle the case rather than going for long litigation.

14. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND

COMPANYS OPERATIONS IN FUTURE

During the year under review, there are no such orders passed by the regulator / courts / tribunals impacting the going concern status and your Companys operations in future.

15. INTERNAL FINANCIAL CONTROL SYSTEMS

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope of work includes review of process for safeguarding the assets of the Company, review of operational e3ciency effectiveness of systems and processes and assessing the internal control strengths in all areas.

Your Company had informed you in The Annual General Meeting of the Company held on the 28th day of September, 2019 about SEBIs Interim Order dated the 1st day of March, 2018 & the representations made by your Company.

Consequently, the Board concurred with the proposal put forward by the Audit Committee to proactively conduct special audit involving an independent examination & review of the Companys operations and past transactions.

The Audit Committee evaluated the experience of M/s. JLN US & Co. and concluded that they are qualified SEBI NSE/BSE empanelled audit 3rm & hence audit be assigned to them.

Accordingly, M/s. JLN Us & Co. were appointed to conduct the review.

We are pleased to inform you that there were no major observations and the Auditors rati3ed the managements response to SEBIs Interim Order.

During the year, your company made several representations to SEBI including a personal hearing to respond to SEBIs observations. We are also pleased to inform you that SEBI modi3ed its earlier order and issued a fresh order dated 27th December, 2018 where all restrictions imposed upon your Directors & Promoters were lifted due to lack of evidence of misuse of funds by the management of your Company.

However, SEBI directed BSE to complete the audit as directed in its Interim Order dated the 1st day of March, 2018. BSE on SEBIs directions had appointed an Auditor to look into your Companys a3airs.

We wish to inform that the audit is being conducted and your Company is cooperating with the Auditors by timely submission of all requisite documents & explanations. We shall inform you when the Auditors furnish their Final Audit Report.

16. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

In pursuance of the provision of Section 135 of the Companies Act, 2013, the CSR provisions were not applicable to the Company.

17. AUDITORS AND AUDITORS REPORT (A) Statutory Auditors :

M/s. Bijan Ghosh & Associates, Chartered Accountants, Statutory Auditors of the company have expressed an unqualified opinion.The Auditors Report to the members does not contain any quali3cation or adverse remarks on the Financial reporting and disclosure of the Company. The Notes to Accounts forming part of the Financial statements are self-explanatory and need no further explanation as required under sub-section (3) of Section 134 of Companies Act, 2013.

3B3 Secretarial Auditor :

Pursuant to Section 204 of Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Directors had appointed Ms. Isha Bothra, Practicing Company Secretary as Secretarial Auditor to conduct the Secretarial Audit for the Financial year 2018-19. The Secretarial Audit Report for the Financial year ended 31st March, 2019 is annexed herewith.

18. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO (A) CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION

The particulars of conservation of energy and technology absorption as required under Section 134(3)(m) of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 are not applicable to the Company.

(B) FOREIGN EXCHANGE EARNINGS AND OUT-GO :

During the period under review there were no foreign exchange earnings or out3ow.

19. MANAGERIAL REMUNERATION

(I) Particulars of Employees pursuant to section197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules,2016; (i) The ratio of the remuneration of each Director to the median remuneration of the employees of the company for the Financial year;

Name of the Directors Remuneration (Rs.) Median Remuneration of Employees (Rs.) Ratio (in times)
Navin Jain 908,850 1.45
6,24,900
Anirban Dutta 397,560 0.636

 

(ii) the percentage increase in remuneration of each director, Navin Jain-28.77%
Chief Financial Officer, Chief Executive Officer, Company Anirban Dutta-8.34%
Secretary or Manager, if any, in the financial year; Pritha Dhandhania-10%
(iii) the percentage increase in the median remuneration of employees in the Financial year; There is 338% change in percentage of median remuneration of employees For the
Financial Year 2018-19.
(iv) the number of permanent employees on the rolls of company; 9 employees as on 31.03.2019.
(v) the explanation on the relationship between average increase in remuneration and company performance; There was 10% increment in the remuneration of the employees of the Company during
the Financial year 31st March, 2019. Also, the Profit for the year was Rs.29,74,639.
(vi) comparison of the remuneration of the Key Managerial The remuneration of the key managerial personnel is keeping in view the performance
Personnel against the performance of the company; of the Company as aforesaid and trend of remuneration in industry.

(vii) variations in the market capitalization of the company, price earnings ratio as at the closing date of the current Financial year and previous Financial year and percentage increase over decrease in the market quotations of the shares of the company in comparison to the rate at which the company came out with the last public o3er;

Particulars As on 31.03.2019 As on 31.03.2018
Market Capitalisation (Rs.) 5,32,82,124 14,70,20,457
Price Earning Ratio N.A. .N.A
Share price : BSE 7.81 21.55

(viii) average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration;

There was no variation in percentile increment made in the salaries of the employees & the Managerial Personnel.

Average percentile increase made in the salaries of employees & the Managerial personnel in the financial year was 10%.

Salary of Mr. Navin Jain increased as his designation changed from Director to Chairman & Managing Director

(ix) comparison of the each remuneration of the Key Managerial Personnel against the performance of the company;

The Comparison of remuneration of each of the KMP against the performance of the Company are as under;

Sl. No. Particulars Remuneration Net Profit
1. Navin Jain 908,850 29,74,639
2. Anirban Dutta 397,560 29,74,639
3. Pritha Dhandhania 250,890 29,74,639

 

Sl. No. Particulars Remuneration Ratio
1. Navin Jain 908,850 1:1.375 times
Manish Kumar Jain 1249900
2. Navin Jain 908850 1:3.44 times
Rakhi Jain 3124900
3. Navin Jain 908850 1:5.85 times
Pramod Jain 5312400

(I) None of the Companys employees has drawn salary more than Rs. 60 Lacs per annum, if employed throughout the year and more than Rs. 5 Lacs per month if employed for the part of the year.None of the Companys employees by himself or along with his spouse and dependent children holds 2% & more equity shares of the Company and drawing remuneration in excess of remuneration of the Whole Time Director except Mr. Pramod Jain & Mrs. Rakhi Jain.

Information as per Rules 5(2) & (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

Sr No. Name Designation Nature of Employment Quali3cation Experience Date of Commen- cement of employ- ment Age Previous Employment % of shares held in the Company Whether related to any Director or Manager
(A) The name of top ten employees in terms of remuneration drawn
1 Pramod Jain Manager Fixed CA More than 10 years 01.04.2010 37 Hindustan Unilever Limited 6.547 Yes- Mr. Navin Jain
2 Rakhi Jain Manager Fixed MBA More than 10 years 01.04.2010 35 HDFC Bank Limited 6.057 Yes- Mr. Navin Jain
3 Manish Kumar Jain Manager Fixed B.Com More than 10 years 01.04.2018 47 None No
4 Navin Jain Chairman & Managing Director Fixed B.Com More than 15 years 11.01.2008 46 NA 1.631
5 Ishan Patni Manager Fixed B.Com I year 01.04.20118 23 None NA No
6 Anirban Dutta Executive Director & CFO Fixed B.Com More than 10 years 25.06.2011 44 NA NA
7 Pritha Dhandhania Company Secretary Fixed CS More than 2 years 18.12.2017 28 None NA No

(B) Personnel who are in receipt of remuneration aggregating not less than Rs. 10,200,000 per annum and employed throughout the year. NIL

(C) Personnel who are in receipt of remuneration aggregating not less than Rs. 8,50,000 per month and employed for the part of the year: NIL

(D) Personnel who are in receipt of remuneration aggregating in excess of that drawn by the Managing Director and holds by himself or along with his spouse and dependent children, not less than 2% of the equity shares of the Company and employed through the year or part of the Financial year:

Pramod Jain Manager Fixed CA More than 10 years 01.04.2010 37 Hindustan Unilever Limited 6.547 Yes- Mr. Navin Jain
Rakhi Jain Manager Fixed MBA More than 10 years 01.04.2010 35 HDFC Bank Limited 6.057 Yes- Mr. Navin Jain

(II) No sitting fees were paid to Independent Directors for attending meetings of the Board for the Financial Year 2018-2019.

20. COMPLIANCE WITH RBI GUIDELINES

Your Company has complied with all applicable regulations of the Reserve Bank of India. As per Non-Banking Finance Companies RBI Directions, 1998, the Directors hereby report that the Company did not accept any public deposits during the year and did not have any public deposits outstanding at the end of the year.

21. CORPORATE GOVERNANCE

Your Company has taken adequate steps to ensure that the conditions of Corporate Governance as stipulated under Regulation 34(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 of the Stock Exchanges are complied with. A separate Section of Corporate Governance and a certi3cate of the Auditors of the Company regarding compliance of the conditions of Corporate Governance as stipulated Regulation 34(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, form part of the Annual Report.

22. MANAGEMENT DISCUSSION ANALYSIS REPORT 3MDAR3

The Management Discussion and Analysis Report for the year under review as stipulated under Regulation 34(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is presented in a separate section which forms part of the Annual Report.

23. TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

In pursuance of the provisions of The Investor Education & Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 subsequently amended by the Investor Education and Protection Fund Authority(Accounting, Audit, Transfer and Refund) Amendment Rules, 2017 there were shares lying with the Company in respect of which dividend was not paid or claimed by the shareholders for seven consecutive years or more in respect of FY 2010-2011.

Accordingly after informing the shareholders continually to claim the unclaimed dividend & complying with all the relevant rules & laws your Company resorted to transfer the shares & dividend in the name of the designated demat account of the IEPF Authority.

The Dividend in respect of the same was duly transferred to the afore mentioned account of the IEPF Authority.

24. LISTING OF SHARES

The Shares of your Company is listed with The BSE Limited & CSE Limited. Your Company has duly paid listing fees to BSE & CSE for the year ended 2018-2019.

25. ACKNOWLEDGEMENTS

Yours Directors would like to place on record their appreciation for the continued co-operation and support received from the Companys Shareholders, Bankers and other business associate.

Registered Offce : On behalf of the Board
6B, Bentinck Street
Aloka House, 1st Floor Navin Jain
Kolkata - 700 001 Chairman & Managing Director
Date : May 29, 2019 (DIN : 01197626)