McDowell Holdings Ltd Directors Report

TO THE MEMBERS,

The Resolution Professional has pleasure in presenting the Annual Report of the Company along with Audited Accounts for the financial year ended March 31,2024.

1. Financial Result

The summary of the financial results of the Company for the financial year ended March 31,2024 is as under;

2. Corporate Insolvency Resolution Process (CIRP)

The Company is undergoing Corporate Insolvency Resolution Process(“CIRP”) in terms of the provisions of the Insolvency & Bankruptcy Code, 2016 (“IBC”) vide order dated 8^th April 2022 passed by the National Company Law Tribunal (“NCLT”) Bengaluru Bench has admitted the said petition vide its order CP(IB) No. 11/BB/2022 dt. 8^th April 2022.

3. Dividend

No dividend has been recommended for the financial year ended March 31,2024, since Company is in CIRP.

4. Companys performance and Operations

The total income of the Company during the financial year under review was Rs. 27.49 lakhs as against Rs.496.76 lakhs in the previous financial year. The decrease in income was primarily due to lower dividends received. The total expenditure during the year was Rs. 218.13 lakhs as against Rs.255.06 in the previous financial year. The net loss during the year was Rs. 129.79 lakhs as against a profit of Rs.180.85 lakhs in the previous year.

5. TRANSFER TO RESERVES

During the year under review, the Company has not transferred any amount to reserves.

6. Market Value of Companys investment

The Companys original net worth taking into account the market value of its investments, would be more than adequate to meet all its liabilities and to continue to operate in the future in the likely event of successful approval/implementation of Resolution Plan approved by COC. Accordingly, the Company continues to present its financial statements on the principles applicable to ‘going concern. (Though the Companys cash flows are strained). Exigent circumstances are prevailing upon the company where upon its investments which could generate income has been attached and frozen by the ED. Under these circumstances, the company is finding it difficult to meet its expenses. The required data to ED has been submitted along with the fact that the company is unconnected and independent company which has been unnecessarily drawn in to the investigation being carried out in the matter of Kingfisher Airlines Ltd / Dr Vijay Mallya. Till date, the investments have not been de-frozen. The Companys efforts are directed towards resolving these issues.

However, the Companys actual net worth at present, taking into account the market value of the Companys investments, (as all the shares are attached by Enforcement Directorate) may not be more than adequate to meet its liabilities and to continue its operations in future as the approval of Resolution Plan is still pending from the Honble NCLT.

As on the date of report the entire share of United Breweries Limited (UBL) has been transferred to SBI by the order of ED in July 2023 so market value of UBL cannot be considered as it is sub-judice

7. Directors (Suspended) and Key Managerial Personnel

Further, Mr. KONDURU PRASANTH RAJU, has been appointed as Resolution Professional (RP) by the Honble NCLT Vide its Order CP(IB) No. 11/BB/2022 dt. 8^th April 2022. RP is currently managing the operations of the company and to take necessary steps in furtherance of the CIRP.

As per the aforesaid order the existing Board was suspended hence Directors, Mr. NANJUNDAIAH RAMANNA (DIN: 08050965) and Mr. MURTHY VENKATA RAMANA GORLE (DIN: 09237825) in their capacity of Independent Directors ceased to be Directors.

During the year, Ms. Namrata Maheswari (ICSI Membership No. A40919) was appointed as the Company Secretary and Compliance Officer (Key Managerial Personnel) of the company, pursuant to provision of Section 203 of Companies Act, 2013 and Regulation 6(1) of the Listing Regulations. w.e.f. 12th July 2023.

Ms. Namrata Maheswari (ICSI Membership No. A40919) resigned as the Company Secretary and Compliance Officer (Key Managerial Personnel) of the company, w.e.f. 31st October 2023,

Further, Ms. Shradha Somani (ICSI Membership No. A41081) has been appointed as the Company Secretary and compliance officer (Key Managerial Personnel) of the company, pursuant to provision of Section 203 of Companies Act, 2013 and Regulation 6(1) of the Listing Regulations. w.e.f. 1st November 2023

8. Resolution Professional Responsibility Statement

The Resolution Professional of the Company hereby state that:

(a) in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed along with proper explanation relating to material departures;

(b) accounting policies have been selected and applied consistently and the judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs ofthe Company as at the end of the financial year and of the profit of the Company for that period;

(c) proper and sufficient care has been taken 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 prevention and detection of fraud and other irregularities;

(d) the Annual Accounts have been prepared on a going concern basis;

(e) Internal Financial Controls have been laid down to be followed by the Company and that such Internal Financial Controls are adequate and operating effectively and

(f) proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

9. Material changes from the end of Financial Year till the date of this report There have been no material changes from the end of the financial year till the date of this report

10. Finance

The Company has not availed any financial assistance during the Financial Year under review

11. Change in nature of business

During the year under review, there has been no change in the nature of business of the Company.

12. Significant and material order passed by the court

The Company, during the Corporate Insolvency Resolution Process have filed cases in different forums, which are listed below.

DISCLOSURES

13. Board and its Committees

As Company is in CIRP, the Board of Directors have been suspended w.e.f. 8^th April 2022, all the powers are vested with the Resolution Professional appointed by the Honble NCLT, Bengaluru Bench, vide order CP(IB) No. 11/BB/2022 dated 8^th April 2022.

Since the Board has been suspended, no Board Meeting, Committee Meetings were held during the financial year under review, consequently no remuneration to Directors were paid.

14. Declarations by Independent Directors

Since the Directors are suspended, no declarations need to be submitted by Independent Directors.

15. Performance Evaluation of the Board and its Committees

Since the Board has been suspended, no performance evaluation of the Board and its Committees are available.

16. Details of remuneration to Directors

Since the Board is suspended, all Directors cease to be Directors, hence no remunerations have been paid to Directors.

17. Particulars of Employees and Related Disclosures

Disclosures with respect to the remuneration of Directors and Employees as required under Section197 of Companies Act, 2013 and Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been carried out, since the Company is in CIRP, effective 8^th April 2022.

The Company had not offered any shares to its employees or Key Managerial Personnel under any scheme of Employees Stock Option and has also not issued any sweat equity at any time.

18. Deposits

During the year under review, your Company did not accept any deposits within the meaning of provisions of Chapter-V, (Acceptance of Deposits by Companies) of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.

19. Corporate Social Responsibility (CSR)

The Company has not constituted a Corporate Social Responsibility Committee as required under Section 135 of the Companies Act, 2013. Since the average net profit of the Company for the preceding three financial years was negative, there was no necessity for the Company to carry out any CSR spending for the period under review.

20. AUDITORS

Statutory Auditors

(a)Appointment of Statutory Auditors:

Resolution Professional has appointed M/s. S.K. Bajpai & Co. w.e.f. 31^st May 2022 as the Statutory Auditors of the Company for doing statutory audit for the FY 2021-22, 2022-23 and 2023-24. The Auditors have confirmed that they fulfill the criteria for appointment as Auditor of the Company as prescribed under the Act and the Rules framed thereunder.

(b) Auditors Qualifications and Board responses:

Certain issues relating to Companys income stream and its effect on the going concern aspects, Companys Investment in various companies is the subject matter of Qualification in the Audit Report. This qualification has been explained in Note no. 21 to 34 of the financial statements.

Secretarial Audit

(a)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 Resolution Professional has appointed M/s. Sachin Thakkar & Associates (C.P.No.15881/Membership No. FCS 11396) Company Secretary in Practice to undertake the Secretarial Audit of the Company.

The Report furnished by Auditor in the format prescribed is enclosed as Annexure - A to this report.

(b) Qualifications and Board responses

The Resolution Professional responses to the qualifications of the Secretarial Audit are as under:

Regarding qualification no. 1 to 11.

The non-compliance/s reported by the Company Secretary (CS) in his CSs Report have been rectified/complied however, due to technical and/or unavoidable reasons, the Resolution Professional (RP) could not file / comply with the same. Every possible effort has been made by the RP for making / resolving the non-compliances.

21. Internal Control System and Risk Management

The Company has a robust system of internal control, the effectiveness of which is tested by the process of internal audit. Your Company through internal audit under the supervision of the Resolution Professional reviews the risk management process, risk mitigation plans and risk reporting.

The adequacy and effectiveness of Internal Financial Controls have been endorsed by the Internal Auditor and the Statutory Auditors. The report of the Independent Statutory Auditors in the annexure to their Audit Report does not contain any adverse observations.

22. Share Capital

The Authorized Share Capital of the Company stands at Rs.15,00,00,000 comprising of 150,00,000 equity share of Rs.10 each and the issued, subscribed and paid-up capital of the Company as on March 31, 2024 remain unchanged at Rs.13,99,22,580 comprising of 1,39,92,258 equity shares of Rs.10 each

23. Depository System

The trading in the equity shares of your Company is under compulsory dematerialisation mode. As the depository system offers numerous advantages, members are requested to take advantage of the same and avail the facility of dematerialisation of the Companys shares. Moreover, transfer of shares of the Company by physical means has been barred from April 1, 2019 pursuant to SEBIs Notification dated December 3, 2018.

24. Listing Requirements

Companys Equity Shares are listed on the BSE Limited and National Stock Exchange of India Limited. The equity shares trading in BSE / NSE are suspended by SEBI. The listing fees has been paid for 2023-2024.

25. Annual Return

As required under sub-section (3) of Section 92 of the Act as amended by the Companies (Amendment) Act, 2017, the Company has placed a copy of the Annual Return in Form MGT-7 on its website www.mcdowellholdings.co.in through the link https://www.mcdowellholdings.co.in/others.html.

26. Nomination and Remuneration Policy

Since the Board has been suspended, no recommendation of the Nomination and Remuneration Committee is laid down.

27. Particulars of Loans, Guarantees or investments

Details of loans, guarantees and investments covered under Section 186 of the Companies Act, 2013 are given in the Notes to the Financial Statements.

28. Subsidiary, Associates and Joint Ventures

The Company does not have any Subsidiary, Associates and Joint Ventures

29. Related Party Transactions

During the year under review, your company did not have any related party transactions in the ordinary course of business and did not consummate material transactions with any related party as defined in the Act.

As there are no transactions with related parties as per the requirements of Accounting Standards 18 issued by The Institute of Chartered Accountants of India, hence no relevant disclosures are required in the Schedule of Notes to Annual Accounts. The policy for Related Party Transactions is available on the Companys website: www.mcdowellholdings.co.in.

30. Familiarization Programme for Independent Directors

Since the Independent Directors have ceased to be Directors, programmes for familiarization of the Independent Directors, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters are not available on the Companys website.

31. Energy Conservation, Technology Absorption, Foreign Exchange Earnings and Outgo

The provisions under Section 134 of the Companies Act, 2013 and rules made there under relating to energy conservation, technology absorption do not apply to the Company, as the Company is not engaged in the manufacturing activities. There were no foreign exchange earnings or outgo during the year under review.

32. Sexual harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

There were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

33. General

The delay in reporting the financial position of your Company is regretted, since as per order of the Official Liquidator, the erstwhile Registered office of the Company had been sealed with effect from 17th August 2023 and the official records were only released on 29th January 2024.

34. Acknowledgement

Resolution Professional wishes to acknowledge the co-operation and support extended by the managerial personnel and consultants of the company.

FOR McDOWELL HOLDINGS LIMITED (in CIRP)