Jindal Hotels Ltd Directors Report.

Dear Members,

Your Directors are pleased to present the Thirty Fifth Annual Report on the business and operations of your Company along with the audited financial statements for the financial year ended 31st March, 2020.

In the year under review, the Company has performed reasonably well and worked intensively and witnessed healthy growth amidst increased competition. Over the years, your Company has pursued a very proactive strategy and approach, anticipating the evolving trends and developing mechanisms to meet diverse crisis. Your Company continues in its quest for excellence by constant improvement of the guest experience through better service levels and product upgrades. Your Directors believe that the Company should offer increasing value to all its stakeholders and society at large. We have maintained this with our tradition and policy of offering high quality content and services. As stewards of the Company, we will always share our vision of growth with you.

1. FINANCIAL HIGHLIGHTS

Your Companys financial performance for the year ended 31st March, 2020 is as below:

(Rs. In Lakhs)

Financial Performance Year ended Year ended
31.03.2020 31.03.2019
Turnover & Other Income 3791.39 3817.87
Less: Expenditure 2698.34 2624.36
Profit before Depreciation, Interest and Taxation 1093.05 1193.51
Interest 471.56 475.40
Depreciation & Amortization 515.60 553.60
Profit before Taxation 105.89 164.51
Provision for Income Tax / Deferred Tax 37.96 14.86
Net Profit after Taxation 67.93 149.71
Other comprehensive Income (OCI) (3.48) 3.60
Net Profit after OCI 64.45 153.25

2. REVIEW OF OPERATIONS

The economic scenario in 2019 has further declined with the GDP growth rate reaching its all-time low of 5 % in the first quarter (Q1, April-June) of fiscal year 2019-20. The current financial year started off at a slow pace in terms of occupancy going down as compared to the previous financial year primarily due to elections. The slump in occupancy rates has also impacted the ARR downwards. However, from second quarter onwards, a jump in the occupancy rates across India to result in occupancies slightly over the 60-70 per cent mark and consequently create a four to six per cent jump in the ARR over FY

19. While performance parameters of hotels are going up, the pace of development has slowed down due to many issues.

Your Company would have posted higher quantum of profit if increased cost of depreciation and interest payment had not been collocated due to expansion & renovation project in the hotel.

In the Financial year 2019-20, there was a decline in RevPAR (Revenue per available Room) growth and in room occupancy rate. The Company also emphasizes for a sharp focus on marketing strategy as well as consistent sales effort to increase room occupancy and ARR.

The industry is stuck in a crack due to oversupply, disruptions through technological innovations and a slowdown in demand due to macro issues. However, the scenario had changed during the mid of the year and industry expected a better performance on major parameters.The ARR story continues to be modest though. While it is true that rates havent grown by leaps, it is equally pertinent to note that the blended nationwide ARR appears to grow slowly because a larger portion of the existing supply is budget and midscale positioned.

Over the last year, your Company has undertaken key initiatives to drive long-term growth – strengthening its core business, exploring new categories, streamlining its operations for better organisational effectiveness and agility, and embedding digitisation in key areas of the value chain.The sales and other income of Financial Year 2019-20 was recorded at Rs. 3791.39 lakhs (PY Rs.3817.87 lakhs). While revenues have declined at 0.69% during the year and net profits to 55% as compared to the previous year.

On March 11, 2020, the WHO (World Health Organization) declared Covid-19 outbreak as a pandemic. The lockdowns and restrictions imposed on various activities due to COVID-19 pandemic have posed challenges on the businesses of Company. As on 31st March 2020, the Company faces significant economic uncertainties due to COVID-19 which have impacted the operations particularly minimal occupancy in hotels and reduction in average realization rate per room and revenue from Restaurant & Banquets. The ongoing COVID-19 pandemic and the worldwide reaction to it has compelled companies to radically rethink their strategies and the way they operate. The increasing need among the companies is to perform tasks on time, within budget and with right resources.

3. MANAGEMENT DISCUSSION & ANALYSIS:

The Management Discussion & Analysis covers the details relating to the Industry Structure & Development, Opportunities & Threats, Outlook, Risk & Concerns, discussion on financial performance with respect to operational performance etc.

BRAND DEVELOPMENT

The importance of a brand tie-up in a highly digitalised economy is continuing to become ever more important. Since June 2017 onwards your Company is being managed and operated by ACCOR group of hotels, an international brand that is compatible with the character and culture of our Company to increase business prospects and strengthen the marketing networking.

Our teams are the key actors of our constant transformation but more than that, they are the authors of their own story with ACCOR. We believe in creativity, curiosity, and the willingness to learn and that makes us agile and capable of making the world a better place. Each individual personality and passion create a unique and authentic emotional connection with our guests.

Prospects & Concerns

The overall growth meltdown in the economy had its impact on the tourism economy of the country as well if the governments own statistics are to be believed. For an industry, which was expecting acceleration in inbound traffic after the first quarter, mainly because of the general elections, had to satisfy with nearly flat growth. The inbound growth for India was just about 3% in the first 10 months of the year, which was lowest considering the track record of the past many years.

The issues in the aviation sector also had its share in Indian tourisms agony. Thereafter, all made air travel a costly affair forcing people to revisit their vacation plans. As the year is coming to close, the reports from various agencies about the financial health of the Indian airline companies is not satisfactory.

Domestic travel has always been the mainstay of Indian tourism and hospitality industry. The domestic consumption of travel products is largely recession-proof because of the Indian middle class appetite to travel and lifestyle. However, recent reports from many leisure destinations have shown the softening of the domestic demand even during the peak months. The overall market sentiment prevailing in the economy seems to be catching up with travel as well if the indications are to be believed.

All these do seem to be bothering the players in the Hospitality 20:20. They are not confident and hope that the 2020 pitch will be very hard to deliver results for them. They repose faith in the millennial fans and hope they will continue to throng the Hospitality stadia to boost the morale of teams in 2020. They certainly have apprehensions in the swing and the rough nature of the wicket they are going to face. But they are nervous and overtly cautious as of now.

The Hotel was shut down entirely during the lockdown phase as the Company was not part of Government denominated essential services. Hotels across the country are virtually closed for the last three months or so with essentially zero revenues while having to bear with mounting fixed costs. The Indian hotels sector has been hit hard : grappling with significantly low demand, with very few future bookings. Essentially, all transient demand has completely vanished and the remaining is largely on account of either a few long stay guests or hotels having been prescribed by the Government for the international travellers returning to India. The Indian hospitality industry is undoubtedly one of the biggest casualties of the COVID-19 outbreak as demand has declined to an all-time low. It is predicted that the second quarter of the year 2020 to be the worst hit. Hotels will be unable to drive rates and may even seek to attract business at deep discounts.

India is the most digitally advanced traveller nation in terms of digital tools being used for planning, booking and experiencing a journey but Indias major chunk of middle class with unstable disposable incomes during the current situation of COVID 19 is not able to support the growth of domestic and outbound tourism during 2020.

In times to come, it is assured by Hotel Operator [ACCOR] that these global players have not only strong National but also International Sales and Marketing Set up. With growing number of hotels in each chain, they are also able to tie up with many Airlines, Credit Card Companies and offer attractive loyalty programmes for the customers. The management continues to expect that there will be increment in Online business and improvement in room occupancy rate due to renovation, refurbishment and up gradation of guest rooms, supported by prevalent personalized service and provision of special amenities for guest comfort.

Retaining the workforce even through training and development in the hotel industry is a tedious task as attrition levels are too high.

GST is a mixed bag of better and easier rules and regulations and increased costs and compliances. The biggest issue for the hospitality industry has been the high rate of 12 per cent GST for hotels charging room rentals upto Rs 7,500/-. COVID 19 pandemic and high taxation are main concern for further growth in business.

Current Year

As the country faces the grappling situation of coronavirus pandemic, its impact can largely be felt by the tourism sector of the country as the once overbooked hotels and transportations are now experiencing a deserted situation.

Travel industry has been hit hard by the pandemic. Since the outbreak, it has been busy honoring cancellation requests and demanding refunds from airlines and hotels. Being the peak season, the sector has suffered huge loss.It is also predicted that if the ongoing situation prevails, the tourism sector may experience in million job losses which accounts for 70% of the total workforce employed by the industry.

When it comes to survival, all that people care about is the basic requirements and forego the luxury. The summer season was the time when people waited to leave their houses and now they are scared to even step outside. This is the fear that the outbreak of the deadly coronavirus has created and the tourism industry is bearing a huge brunt, especially the hotel and aviation industry, who are longing to welcome a visitor for weeks now.

Although the people from the tourism industry are eagerly waiting for the upliftment of the lockdown and resuming their operations, the will of traveling in people after the lockdown remains questionable. It is also anticipated that when things turn back to normal, people initially might not be comfortable in indulging in big travel plans, however, a few small domestic travel plans can be expected. Also, the approach of various hotels, airlines and travel agents of tackling the current pressure from the customers will severely define the decisions that customers will take in planning their next trip.

With the impact to the travel industry worse than ever, the human toll of this public health crisis has been absolutely devastating for the hotel industry. For the hotel industry priority is rehiring and retaining our hardworking employees who power vibrant industry. Hotels were one of the first industries affected by the pandemic and will be one of the last to recover. Supportive measures for the hotel industry is the need of the hour to make important policies to reflect the current economic reality and help the employees in the industries that have been impacted the most.

During the Current year in first quarter the sales and turnover is negligible i.e Rs. 64.17 lakhs only as compared to previous corresponding period and an estimated loss of Rs. 375 lakhs. Your Company continues in its quest for excellence by constant improvement of the guest experience through better and safe service levels, innovative concepts, product upgrades, sales and marketing initiatives etc.

Post COVID-19/UNLOCK : The New Guest Experience

How to inspire guest confidence that hotels are safe and clean and how to win back guest business ?

Due to the dramatic downturn in travel, properties that remain open are operating with minimal staffing. The hotel industry is at a critical juncture. We need more resources to survive this unprecedented time. Additionally, as the pandemic continues, travel intent during the upcoming six months continues to decline.

Indias restaurant industry is facing what is possibly its worst existential crisis. While the COVID-19 lockdown reduces risk of transmission, it has also meant that revenues dropped to zero, with businesses struggling to find the cash to pay their employees and make rent. Perhaps the pandemic is merely exposing the cracks that already existed. Around the world, restaurants have been forced out of business. It will be a while before these fundamental changes can be implemented, and even longer before they show effect. In the meantime, restaurants have the more urgent task of rebuilding confidence. They are examining how hygiene and social distancing protocols can be implemented.

Early indications reveal that younger adults will be the first to travel again as evidenced by their intent to engage in almost every type of travel-related activity during the next six months

Post coronavirus weddings: The new normal when it comes to ‘I do

Weddings across the globe have been put on hold for the time being. Most weddings are expected to be pushed to the latter half of 2020 or the beginning of 2021. However, on the brighter side, in lieu of the nationwide lockdown to-be-weds can utilise this time to better plan their wedding once the virus threat is down to negligible.

The ‘New Normal for celebrating weddings in the post-COVID-19 world is going to be different. With social distancing becoming the norm, weddings will be smaller, more intimate, and with emphasis on top-notch hygiene standards as well as ensure contactless services. Given this situation, to limit risks and ensure safety, couples who plan to celebrate their weddings during the latter half of the year will have to consider altering their wedding plans.

In the aftermath of COVID-19 and once the lockdown is over, we expect many couples to tie the knot, however, the way they do it will change. Couples will forego the ‘big fat wedding for an intimate, more cautious wedding, adhering to social distancing norms. To ease worries of guest during the pandemic, we are engaging with them virtually by conducting digital meetings and venue recess, offering more flexibility in terms of booking and rescheduling weddings for a later date. We hope such measures benefit everyone.

Tweaking the buffet-style service

The highlight of any Indian wedding is its lavish buffet. In an effort to comply with physical distancing measures, this is about to change too. While some couples may still opt for buffet-style service, precautionary measures like a contactless serving of dishes will be the norm. Opting for family-style entrees or sides at the table is another way to ensure the safety of guests, thereby avoiding serpentine queues at the food counters, where people tend to gather in close proximity at weddings. Besides this, Restaurants will also have to ensure that the raw materials or ingredients for food preparation are sourced from trustworthy suppliers, who ensure utmost cleanliness while delivering the stock from the farm to the venue.

As weddings go local, they also go virtual

In the aftermath of the pandemic, we can expect couples to opt for local weddings in their hometowns, instead of destination weddings. Additionally, overseas guests may prefer being a part of the celebration virtually, due to restrictions for non-essential travel. Furthermore, live streaming wedding ceremonies are a foreseeable trend in the near future. Therefore, wedding planners and venue operators can expect a surge in demand for such services post-COVID-19.

Impeccable hygiene standards

Right from the entry to exit, venues need to place sanitizers and hand napkins at every point. Guests should be able to sanitize their hands on arrival, have access to cleaning and protective equipment at their tables, ample availability of hand washes and sanitizers should be made in the washrooms. To avoid overcrowding the washrooms, guests should have a designated waiting area where they can maintain physical distance from each other. All venues should diligently disinfect spaces pre and post the wedding function.

Apart from venue hygiene, even makeup artists and photographers documenting the wedding will have a certain Standard Operating Procedures (SOP) to follow in the post-pandemic phase. To ensure that the bride feels safe, makeup artists and hairstylists will wear masks and sanitise their products. With regards to photographers, the wedding party will prefer a smaller team to cover the wedding. Additionally, as weddings are set to be more intimate, a large team wont be required at the venue.

Adapt to a post-COVID-19 culture

The new normal for weddings across the world is going to be significantly different. In the meanwhile, its time to stay educated, make more informed decisions and rethink safer ways to plan happy and safe celebrations post the pandemic.

Our main forte and focus has been the popularity of Food and Beverages facilities. The foray of Indian restaurants into a variety of global cuisines and food fusion is having a positive impact on the F&B sector. Customers are more willing to experiment with different cuisines because it is now easily accessible in the cities they live in, and this trend had increased Indian consumers frequency of eating out.

Your Hotels communication campaign is through leading dailies, magazines, hoardings and social networking (Facebook, Instagram, Twitter along with other social media options) also. The management has taken active steps to promote the property with some effective marketing initiatives. We are launching some new services to add to the brand portfolio. Internal skill sets are being honed and developed for better utilization and implementation of available resources. With these efforts, we hope to increase the profitability of your Company in the coming years.

Going forward, it is expected that the industry to register an overall healthy growth on back of economic growth. The sector also faces several challenges in terms COVID 19, complex regulatory environment and inadequate tourism infrastructure.

Government Initiatives

The Indian government has realised the countrys potential in the tourism industry and has taken several steps to make India a global tourism hub. Some of the major initiatives planned by the Government of India to give a boost to the tourism and hospitality sector of India are as follows:

• Ministry of Tourism launches Audio Guide facility App called Audio Odigos for 12 sites of India (including iconic sites).

• Prime Minister, Mr Narendra Modi urged people to visit 15 domestic tourist destinations India by 2022.

Statue of Sardar Vallabhbhai Patel, also known as ‘Statue of Unity, was inaugurated in October 2018. It is the highest standing statue in the world at a height of 182 metre. It is expected to boost the tourism sector in the country and put India on the world tourism map.

• The Government of India is working to achieve one per cent share in worlds international tourist arrivals by 2020 and 2 per cent share by 2025.

• Under Budget 2020-21, the Government of India allotted Rs 1,200 crore (US$ 171.70 million) for development of tourist circuits under Swadesh Darshan for eight north-eastern states.

• Under Budget 2020-21, the Government of India allotted Rs 207.55 crore (US$ 29.70 million) for development of tourist circuits under PRASHAD.

• Under Budget 2020-21, the Government of India allotted Rs 1,200 crore (US$ 171.70 million) for development of tourist circuits under Swadesh Darshan for eight north-eastern states.

• In 2019, Government reduced GST on hotel rooms with tariffs of Rs 1,001 (US$ 14.32) to Rs 7,500 (US$ 107.31) per night to 12 per cent; those above Rs 7,501 (US$ 107.32) to 18 per cent to increase Indias competitiveness as a tourism destination.

• In September 2019, Japan joins a band of Asian countries, including Taiwan and Korea among others to enter into the Indian tourism market.

4. DIRECTORS AND KEY MANAGERIAL PERSONNEL

There was change in the composition of Board of Directors during the Financial Year 2019-20.

Pursuant to applicability of Regulation 17(1A) of LODR (Amendments) Regulations , 2018, Mr. Ambalal C Patel, Non-Executive Independent Director has resigned on 31st March , 2019 on attaining the age of 75 years on 1.04.2019. Thereafter at 34th AGM the members appointed Mr. Ambalal Patel , aged 75 Years for 5 Years as Independent Director, not liable to retire by rotation. And re appointment of Mr. Jatil G Patel & Mr. Mukund P Bakshi as Independent Directors (not liable to retire by rotation) of the company for a period of five years up to 31.03.2024.

Ms. Chanda Agrawal retires by rotation at the forthcoming Annual General Meeting and being eligible offer herself for re-appointment.

The Board commends her reappointment by the members at the forthcoming Annual General Meeting.

5. RESERVES

The Board do not recommend to transfer any amount to General Reserves.

6. DIVIDEND

To augment working Capital Requirement your Directors have not recommended Dividend for the Financial Year 2019-20.

7. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

In terms of Section 125 of the Companies Act, 2013, any unclaimed or unpaid Dividend for the financial year ended March 31, 2013 is due for remittance on 29th October, 2020 to the Investor Education and Protection Fund established by the Central Government.

Further Section 124(6) of the Companies Act, 2013 read with Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and refund) Rules, 2016 amended from time to time, which inter alia requires the Company to transfer the equity shares on which the dividend has remained unpaid or unclaimed for a continues period of seven years, to a special demat account to be opened by Investor Education and Protection Fund Authority (‘IEPF Authority). The Company has intimated individually to all such shareholders.

8. SHARE CAPITAL

The paid up equity share capital as on 31st March 2020 was Rs. 6,00,00,000/-. There was no public issue, rights issue, bonus issue or preferential issue, etc. during the year. The Company has not issued shares with differential voting rights, sweat equity shares, nor has it granted any stock options.

9. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statements relate on the date of this report.

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

The information pertaining to conservation of energy, technology absorption, Foreign exchange Earnings and outgo as required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is furnished below:

# CONSERVATION OF ENERGY

The Company is extremely cautious with regard to resource management & particularly the energy conservation be it electrical or gas consumption. We have installed necessary capacitors in our electrical sub stations & VFD (Variable Frequency Drive) in most of the motors. All the halogens, incandescent bulbs & even the PL tubes (Plug in light) are almost replaced with LED (Light Emitting Diodes). The entire property has magnetic door locks which monitors the overall supply to individual guest rooms & thermostats controls are provided for guest comfort & energy saving. All the glass window are replaced with Double Glace DGU & fixed sunscreen protection are laid on them.The new magnetic chillers used for air conditioning process have proved to be major savers.

Besides these, the hotel teams continued their efforts to explore opportunities to reduce energy consumption by:

• controlled use of lighting and other equipment;

• regulating of chilled water set points according to ambient temperature;

• setting benchmarks for energy consumption by area.

• upgrading building management systems;

• Zero Flush Urinals installed in Banquet Halls (Save Water Save Energy);

• Every Quarter we have a trend of celebrating Energy Saving Week wherein entire team is motivated not only to save energy but also to contribute their ideas for energy conservation.

# TECHNOLOGY ABSORPTION

In the Opinion of the Board, the required particulars, pertaining to technology absorption are not applicable as hotels form part of service industry.

# FOREIGN EXCHANGE EARNINGS AND OUTGO

During the year under review, your Company earned Foreign Exchange of Rs. 3,18,31,846/- (PY Rs. 3,16,29,745/-), whereas outflow of foreign exchange was Rs. 21,89,488/- (PY Rs. 17,99,928/-)

11. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY

The Company has been taking proactive approach concerning the development and implementation of a Risk Management Policy after identifying the following elements of risks which in the opinion of the Board may threaten the very existence of the Company itself.

(a) financial; (b) legal and regulatory; (c) operating; and (d) commercial risks, including health, safety and environment.

The Company does not have any Risk Management Committee as the Board takes into consideration all the risk factors at regular intervals at its meetings.

12. INSURANCE

The Company has a broad-banded approach towards insurance. Adequate cover has been taken for all movable and immovable assets against numerous risks and hazards.

13. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND

REDRESSAL) ACT, 2013.

Your Company has Zero tolerance for sexual harassment at its workplace and has adopted a policy on prevention, prohibition and Redressal of sexual harassment at work place in-line with the provisions of the sexual Harassment of women at work place (Prevention, Prohibition and Redressal) Act,2013 and the Rules thereunder for prevention and redressal of complaints of sexual harassment at workplace.

The Company has adopted an Anti-harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaint Committee are set up to redress complaints received regularly and are monitored by women line supervisors who directly report to the Chairman & Managing Director. There was no complaint received from any employee during the financial year 2019-20 and hence, no complaint is outstanding as on March 31, 2020 for redressal.

14. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013

There was no loans, guarantees or investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review and hence the said provision is not applicable.

15. DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

16. COMPANYS POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF REMUNERATION AND DISCHARGE

OF THEIR DUTIES

The provisions of Section 178(1) relating to constitution of Nomination and Remuneration Committee are applicable to the Company and hence the Company has devised policy relating to appointment of Directors, payment of Managerial remuneration, Directors qualifications, positive attributes, independence of Directors and other related matters as provided under Section 178(3) of the Companies Act, 2013 and have been displayed on website www.suryapalace.com.

17. FORMAL ANNUAL EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17(10)of SEBI (LODR), regulation 2015 a structured questionnaire was prepared after taking into consideration the various aspects of the Boards functioning, composition of the Board and its committees. The Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Committees.

18. STATUTORY AUDITORS

M/s Modi & Joshi , Chartered Accountant, Vadodara were appointed as Statutory Auditors for a period of 5 years [i.e from FY 2017-18 to FY 2021-22] in the 32nd Annual General Meeting held on 12th September, 2017. They have confirmed that they are not disqualified from continuing as Auditors of the Company. The requirement to place the matter relating to appointment of auditors for ratification by members at every Annual General Meeting is withdrawn vide notification dated May 7, 2018 issued by Ministry of Corporate Affairs , New Delhi. Accordingly, no resolution is proposed for ratification of appointment as Auditors.

19. RATIO ANALYSIS

There is no material or significant changes (i.e. change of 25% or more as compared to the immediately previous financial years) in Key Financial Ratio.

As compared to previous year, Debt Equity Ratio, Current Ratio and Debtors Coverage Ratio have been improved.

Where as Interest Coverage Ratio, Inventory Turnover Ratio, Operating Profit Margin Ratio, Net Profit Margin Ratio and Return on Net worth are slightly impaired.

Change in Return on Net Worth as compared [CY: 2.48%] to previous year [PY: 5.61%] has impaired.

20. SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. Kashyap Shah, a Company Secretary in practiceto undertake the Secretarial Audit of the Company. The Secretarial Audit Reportis furnished in Annexure 1 (Form No. MR-3).

21. EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS

MADE BY THE AUDITORS AND THE PRACTICING COMPANY SECRETARY IN THEIR REPORTS

There was no qualifications, reservations or adverse remarks made by the either by the Auditors or by the Practicing Company Secretary in their respective reports.

22. EXTRACT OF ANNUAL RETURN

The extract of Annual Return pursuant to the provisions of sub-section (3) Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is furnished in Annexure 2 (Form No. MGT- 9) and is attached to this Report. Annual Return will be placed at website of the Company [www.suryapalace.com]

23. DISCLOSURE UNDER RULE- 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATOIN) RULES, 2014

Disclosure required under Section 197 of the Companies Act, 2013 read with Rule-5 of the Companies (Appointment and remuneration) Rules, 2014 have been annexed as Annexure-3.

24. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

The contract or arrangements made with related parties as defined under Section 188 of the Companies Act, 2013 during the year under review is furnished in Annexure 4 (AOC -2) and is attached to this report. All the Related Party Transaction are held at arms length price and in Ordinary Course of Business and hence approval under Section 188 is not required.

Your Companys Policy on Related Party Transactions, as adopted by your Board, can be accessed on the Companys website at www.suryapalace.com

25. CORPORATE GOVERNANCE CERTIFICATE

The Compliance certificate from Practicing Company Secretaries regarding compliance of conditions of corporate governance as stipulated in Schedule V of the Securities Exchange Board of India (Listing Obligation Disclosure Requirement) Regulation,2015 is annexed as Annexure 5 to the report.

26. NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW

The Company had five Board meetings during the financial year under review on 14th May, 2019, 13th August, 2019, 27th September, 2019, 12th November, 2019 & 11th February, 2020.

27. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any Subsidiary, Joint venture or Associate Company.

28. INTERNAL CONTROL SYSTEMS & THEIR ADEQUACY

Your Company has in place an adequate system of Internal Controls, with documented procedures covering all corporate functions and hotel operating unit to ensure that all transactions are authorized, recorded and reported correctly. This ensures prompt financial reporting, optimum utilization of various resources and immediate reporting of deviations. Compliance with laws and regulations is also ensured and confirmed and is checked by the Internal Auditor of the Company.

The reports of the Internal Auditor are reviewed by the Audit Committee. The Audit Committee also reviews adequacy of internal controls, system and procedures, insurance coverage of assets from various risks and steps are taken to manage foreign currency exposures. The Audit Committee also interacts with Internal Auditors and Statutory Auditors of the Company to ensure compliance of various observations made during the conduct of audits and adequacy of various controls.

29. DEPOSITS

The Company has not invited deposit from members or public. Inter Corporate deposits received from corporate as unsecured loans (for details refer Annexure 4: Form AOC-2)

30. WEBSITE

The corporate website www.suryapalace.com reflecting the new architecture is far more experimental, with large images showcasing the property and its facilities, enhanced content, both in quantity and quality, with in depth information on experiences, services and facilities. The website also displays financial & corporate information.

31. DECLARATION OF INDEPENDENT DIRECTORS

The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules. We confirm that in opinion of the Board IDs fulfill the conditions specified in LODR Regulations and are independent of the Management.

32. DISCLOSURE OF COMPOSITION OF AUDIT COMMITTEE AND PROVIDING VIGIL MECHANISM

The Audit Committee consists of the following members a. Mr. Jatil Patel (Chairman & Non- executive Independent Director) b. Mr. Ambalal Patel (Non-executive Independent Director) [Appointed at 34th AGM on 24.09.2019] c. Ms. Chanda Agrawal (Non-executive Director) d. Mr. Mukund Bakshi (Non-executive Independent Director)

The above composition of the Audit Committee consists of independent Directors who form the majority. The details of Constitution of all committees namely Audit Committee, NRC & Stakeholders Relationship Committee is mentioned in the Corporate Governance Report [which forms part of Annual Report].

The Company has established a vigil mechanism and overseas through the committee, the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the Chairman of the Audit Committee on reporting issues concerning the interests of co employees and the Company.

33. DIRECTORS RESPONSIBILITY STATEMENT

In accordance with the provisions of Section 134(5) of the Companies Act, 2013 the Board hereby submit its responsibility Statement:-

(a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) the directors 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 and loss of the company for that period;

(c) the directors 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) the directors had prepared the annual accounts on a going concern basis; and

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

(f) 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.

34. DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS

During the year under review, there were no frauds reported by the Company or fraud on the Company by the officers and employees of the Company has been noticed or reported or no fraud are reported by the auditors to the Audit Committee or the Board under section 143(12) of the Companies Act, 2013.

35. SECRETARIAL STANDARDS OF ICSI

Pursuant to the approval given on 10th April, 2015 by the Central Government to the Secretarial Standards specified by the Institute of Company Secretaries of India, the Secretarial Standards on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2) came into effect from 1st July 2015 and further amendments applicable w.e.f. f 1st October , 2017. The Company is in compliance with the same.

36. VIGIL MECHANISM/ WHISTLE BLOWER POLICY

The Company has adopted the whistle blower mechanism for directors and employees to report concerns about unethical behavior, actual or suspected fraud, or violation of the Companys code of conduct and ethics. The Company has a "Whistle Blower Policy", the copy of which is available on the website of the Company, namely www.suryapalace.com.

37. SAFETY & ENVIRONMENT

The Company is committed to providing a safe and healthy working environment and achieving an injury and illness free work place.

38. ACKNOWLEDGEMENTS

Your Directors would like to express its sincere appreciation and gratitude to the Companys valued stakeholders including Members, customers, Bankers, vendors, business partners, State Government and the Government of India for their continued co-operation and support.

Directors also place on record sincere appreciation of the commitment and enthusiasm of all its employees.

An acknowledgement to all, with whose help, cooperation and hard work, the Company is able to achieve the results.

For and on behalf of the Board of Directors
Place: Vadodara
Date: 23rd June , 2020
Signing as per Board resolution passed on 23rd June, 2020
Ambalal Patel
Chairman