Midwest Gold Ltd Directors Report.

To

The Members,

Your Directors have pleasure in presenting the THIRTY FIRST ANNUAL REPORT together with the Audited Financial Statements of the Company for the Financial Year ended 31st March, 2021.

1. FINANCIAL HIGHLIGHTS:

The performance of the Company for the Financial Year ended 31st March, 2021, is summarized below.

(Amount in Rupees)

PARTICULARS 2020-2021 2019-2020
Gross Revenue 39,18,347 62,04,579
Total Expenditure 2,00,08,074 1,49,18,236
Profit/(Loss) before tax (PBT ) (1,60,89,727) (87,13,657)
Less: Tax Expenses (16,42,497) 38,91,923
Profit/(Loss) after tax (1,38,21,487) (1,25,08,883)
Total other comprehensive Income/Loss 0 0
Total comprehensive Income/Loss (1,38,21,487) (1,25,08,883)
EPS (4.23) (3.83)

2. STATEMENT OF COMPANY AFFAIRS:

Your Company has achieved a Turnover of Rs. 37,07,032/- excluding other income of Rs. 2,11,315/- when compared to Rs. 57,87,577/- excluding other income of Rs. 4,17,002/- during previous year. The operations of the Company resulted in loss of Rs. 1,38,21,487/- when compared to loss of Rs. 1,25,08,883/- during previous year.

3. FUTURE OUTLOOK:

The management has done well to ensure sustained operations. However, due to low income and higher expenditure, the operations resulted in loss as specified above. Efforts are being made to improve the turnover and reduce the costs involved in the coming years. The management is looking to improve the overall business activities of the Company thereby reviving from loss in the ensuing financial year.

4. DIVIDEND:

Considering the operating loss in current year and accumulated losses, your Directors had decided not to recommend any dividend for the financial year 2020-2021.

5. DEPOSITS:

The Company has not accepted any deposits during the year.

6. TRANSFER TO RESERVES:

During the year no amount was transferred to General Reserve.

7. CHANGE IN THE NATURE OF BUSINESS:

During the year there was no change in the nature of the business activities of the Company.

8. ACCOUNTING TREATMENT:

There was no change in accounting treatment in the current year, as compared to previous Financial Year.

9. NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR:

The Company has conducted Nine (9) Board Meetings, Four (4) Audit Committee, Four (4) Nomination and Remuneration Committee Meetings and Two (2) Stakeholders Relationship Committee Meetings during the financial year and all such meetings were held in compliance with the provisions of Companies Act, 2013 and Secretarial Standards as applicable. During the year, the Company has reconstituted Audit Committee, Nomination and Remuneration Committee and Stakeholders Relationship Committee due to change in constitution of Directors and composition of each committee has been detailed in Corporate Governance Report.

10. DIRECTORS AND KEY MANAGERIAL PERSONNEL INFORMATION:

Retirement of Mrs. Neelima Kotagiri due to expiry of her term on 28.09.2020.

Mrs. Neelima Kotagiri tenure as Independent Director had expired on 28.09.2020 and same was taken on note by the board in their meeting held on 19.10.2020 with effect from 29.09.2020.

Appointment of Mr. Sudi Malyadri as an Additional (Independent & Non-Executive) Director Company w.e.f 19.10.2020.

Mr. Sudi Malyadri was appointed as Additional - Independent Director of the Company w.e.f 19.10.2020 by the board and his appointment shall be regularized subject to approval of members in the ensuing Annual General Meeting.

Resignation of Mrs. Soumya Kukreti from the position of Director of the Company w.e.f 27.11.2020.

Mrs. Soumya Kukreti had submitted a letter informing her resignation from the position of Director of the Company with effect from 27.11.2020 and same was accepted by the board in their meeting held on 27.11.2020.

Appointment of Mrs. Rajyalakshmi Ankireddy as Additional Director of the Company w.e.f 27.11.2020.

Mrs. Rajyalakshmi was appointed as an additional non-executive woman director of the Company w.e.f. 27.11.2020 by the board and her appointment shall be regularized subject to approval of members in the ensuing Annual General Meeting.

Reappointment of Retiring Director:

In accordance with the provisions of Companies Act, 2013, Mr. Deepak Kukreti, Whole Time Director is retiring at the ensuing Annual General Meeting and being eligible, offers himself for reappointment.

Re-appointment of Mr. Deepak Kukreti as Whole Time Director liable to retire by rotation for a period of five years:

Mr. Deepak Kukreti tenure as Whole Time Director will expire on 27.10.2021 and your board of directors recommended his re-appointment for another period of five years with effect from ensuing Annual General Meeting, i.e, 17.09.2021.

Resignation of Mr. Jitendra H.Raut, Company secretary and Compliance Officer w.e.f closing hours of 31.12.2020.

Mr. Jitendra H.Raut had submitted a letter informing his resignation from the position of Company Secretary (KMP) & Compliance Officer of the Company w.e.f closing hours of 31.12.2020 and same was accepted by the board in their meeting held on 02.01.2021.

Further, after end of financial year and before presentation of this report, following changes occurred in Composition of Directors and KMP of the Company:

Mr. Ramesha.K was appointed as Company Secretary and Compliance Officer of the Company with effect from 24.04.2021. However, due to personal reasons and other pre-occupations, he had resigned from the said position with effect from 21.06.2021.

In order to fill this vacancy, Mr. G. Sai Prashanth was appointed as Company Secretary and Compliance Officer (KMP) of the Company with effect from 21.06.2021.

11. DISCLOSURE UNDER SECTION 164(2) OF THE COMPANIES ACT, 2013:

The Company has received the disclosures in Form DIR-8 from its Directors being appointed or re- appointed and has noted that none of the Directors are disqualified under Section 164(2) of the Companies Act, 2013, read with Rule 14(1) of the Companies (Appointment and Qualification of Directors) Rules, 2014.

12. SUBSIDIARY COMPANIES:

The Company does not have any subsidiary Companies as on 31st March, 2021. There are no Associate Companies within the meaning of Section 2(6) of the Companies Act, 2013. Therefore, the question of material change of the business of subsidiaries/associates does not arise.

13. 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 and the date of the report. However, considering the pandemic situation prevailing in the country, the business activities scale has been reduced due to state-wide lockdown during the month of May 2021.

14. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK

MANAGEMENT POLICY OF THE COMPANY:

In pursuant to the provisions of the Section 134 (3)(n) of The Companies Act 2013, the Company has formulated risk management policy to mitigate and manage the risk including identification therein of elements of risk, if any, which in the opinion of Board may threaten the existence of the company.

The policy on Risk Management is available on website of the Company www.midwestgoldltd.com.

15. BOARD DIVERSITY:

The Policy on Board diversity of the Company devised by the Nomination and Remuneration Committee to the extent applicable as per the provisions of the Companies Act, 2013 read with relevant Rules applicable if any and approved by the Board is available on the website of the Company at www.midwestgoldltd.com under Nomination and Remuneration Policy.

16. CORPORATE SOCIAL RESPONSIBILITY:

In terms of section 135 of the Companies Act, 2013, every company having net worth of rupees five hundred crore or more, or turnover of rupees one thousand crore or more or a net profit of rupees five crore or more during the immediately preceding financial year shall constitute CSR Committee and formulate a Corporate Social Responsibility (CSR) Policy. Since, the Company does not fall under mentioned criteria during the immediately preceding financial year, the provisions of Sec 135 of the Companies Act, 2013, Schedule VII and the rules made thereunder are not applicable to the Company.

Accordingly, a report on CSR activities as per rule 9 of the Companies (Corporate Social Responsibility) Rules, 2014 is not applicable.

17. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER

SECTION 186 OF THE COMPANIES ACT, 2013:

The Company has not given any Loans, or made Investments made under Section 186 of the Companies Act, 2013 to other Bodies Corporate or persons as referred thereto during the financial year. However the Company has given guarantee/ security in favor of HDFC Bank Ltd on behalf of Midwest Granite Pvt. Ltd, Holding Company of the Company for an additional amount of Rs. 1.42 Crores during the financial year and the outstanding liability towards the said guaranatee/ security stood at Rs. 3,92,43,192/- as on 31.03.2021, which is well within the limits of prior approval of the Shareholders.

18. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED

PARTIES:

The transactions entered with related parties during the year were on arms length basis and in the ordinary course of business and with approval of members wherever required in accordance with provisions of Section 188 of the Companies Act, 2013. Further, there are no material related party transactions as applicable under the SEBI (LODR), Regulations, 2015 during the year with Directors or Key Managerial Personnel. The disclosure as per section 134(3)(h) & Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form AOC-2 is enclosed herewith as Annexure-I.

19. COMPANYS POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF

REMUNERATION AND DISCHARGE OF THEIR DUTIES:

The Board has framed a 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 based on the recommendation of Nomination and Remuneration Committee and same has been placed on website of the Company www.midwestgoldltd.com with name Nomination and Remuneration Policy.

20. DECLARATION OF INDEPENDENT DIRECTORS:

Pursuant to section 134 (3) (d) of the Companies Act, 2013, a statement shall be made on declaration given by Independent Directors under sec 149 (6) of the Companies Act, 2013 in the Board report. The Board has received declarations from the Independent Directors, as required under Sec 149 (7) of the Companies Act, 2013 stating the fulfillment of criteria mentioned in the sub section (6) of Sec 149 of the Companies Act, 2013 and the rules made thereunder.

21. EVALUATION OF THE BOARDS PERFORMANCE:

In compliance with the requirements of Section 134(3) (p) of the Companies Act, 2013 and the applicable Regulations of SEBI (LODR) Regulations, 2015, the performance of the Board was carried out during the year. The Board was evaluated for its performance based on the following factors:

i. Attendance of Board Meetings and Committees;

ii. Contribution made to the Board discussions and future planning;

iii. Level of commitment to the stakeholders interest;

iv. Initiatives towards the growth of the business and profitability;

v. Providing outlook, view points and feedback taking the Company ahead beyond expectations.

The evaluation involves Self-Evaluation by the Board Member and thereafter in the following manner:

a) Individual Directors - The performance of the individual Directors is evaluated

by the Nomination and Remuneration Committee.

b) Board and Committees – The Board evaluated its own performance and also of the Committees taking into consideration the above mentioned factors. A member of the Board does not participate in the discussion of his / her evaluation.

22. SECRETARIAL STANDARDS :

The Directors state that applicable Secretarial Standards, i.e. SS-1 and SS-2, relating to ‘Meetings of the Board of Directors and ‘General Meetings, respectively, have been duly followed by the Company.

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

The information regarding Energy Conservation, Technology Absorption, Foreign Exchange Earnings and Outgo as required by section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 are given as Annexure-II and forms part of this report.

24. INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has put in place an adequate system of internal control commensurate with its size and nature of business. These systems provided a reasonable assurance in respect of providing financial and operational information complying with applicable statutes safe guarding assets of the Company and ensuring compliance with Corporate Policies. Procedures to ensure conformance with policies, standards and delegation of authority have been put in place covering all activities. Audit Committee periodically reviews the performance of internal audit system.

The Company has rigorous business planning system to set the targets and parameters for operations which are reviewed with actual performance to ensure timely initiation of corrective action if required. The Audit Committee reviews adherence to the internal control system and internal audit reports. Further the Board actually reviews the effectiveness of the Companys internal control system.

25. STATUTORY AUDITORS:

The requirement to place the matter relating to appointment of Auditors for ratification by members at every Annual General Meeting is done away vide notification dated May 7, 2018 issued by the Ministry of Corporate Affairs, New Delhi. Accordingly, no resolution is proposed for ratification of appointment of Auditors, who were appointed in the AGM held on 30th September, 2017.

26. AUDIT REPORT AND OBSERVATIONS, IF ANY:

The notes to accounts referred to in the Auditors Report are self explanatory and therefore do not call for any further comments. The auditors have reported no observations or qualifications in their report for the financial year 2020-21.

27. INTERNAL AUDITOR:

Your Company continuously invests in strengthening its internal control process and appointed Mr. I. Venkateswarlu, M.Com, LLM, who is having vast knowledge and over 40 years experience in the field of accounts, finance, Law, costing, etc., as Internal Auditor of the Company.

28. SECRETARIAL AUDIT:

In accordance with the provisions of Section 204 of the Companies Act, 2013 read with Rule 9 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has got the Secretarial Audit conducted from a Practicing Company Secretary.

The Secretarial Audit Report issued by a qualified Company Secretary in Practice, in Form MR-3, in respect of the secretarial audit of the Company for the financial year ended 31st March 2021, is annexed herewith as Annexure III.

29. COST AUDIT:

The Company is not required to maintain cost records as per section 148 of Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014 as the turnover of the Company for the financial year 2020-2021 is below Rs. 35 Crores.

30. EXPLANATION ON QUALIFICATION(S) MADE BY AUDITORS:

There is no qualification to be addressed in the statutory and secretarial audit report of the Company for the financial year ended 31st March, 2021.

31. EXTRACT OF ANNUAL RETURN:

The extract of Annual Return (MGT – 9) pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and administration) Rules, 2014 is annexed herewith as Annexure IV and same is placed on website of the Company www.midwestgoldltd.com.

32. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

Management Discussion and Analysis Report, pursuant to Regulation 34 of the SEBI (LODR) Regulations, 2015 forms part of this Report and is annexed as Annexure-V.

33. CORPORATE GOVERNANCE:

Pursuant to the Regulation 15(2) of SEBI (LODR) Regulations, 2015, the regulations pertaining to the Corporate Governance i.e., 17 to 27 & Clauses (b) to (i) and (t) of sub regulation 46(2) and para C, D & E of schedule V are not applicable to the Company as the paid-up capital is not exceeding Rs. 10 Crores and net worth is not exceeding Rs. 25 Crores as on the latest Audited Balance Sheet.

However the Company has implemented the procedures and adopted practices in conformity with the Code of Corporate Governance of the SEBI (LODR) Regulations, 2015 to the limited extent applicable in-line with the provisions of Companies Act, 2013 and relevant rules made there under. A separate report on Corporate Governance is annexed herewith as Annexure-VI though it is not applicable to the Company, in order to provide brief information to the Shareholders.

34. RATIO OF REMUNERATION OF EACH DIRECTOR TO EMPLOYEE:

As none of directors of the Company are paid with remuneration, the ratio of remuneration of each director to the median employee shall not arise. However, remuneration has been paid to Key Managerial Personnel and details are detailed below:

(i) The percentage increase in remuneration of each Director, Chief Financial Officer and Company Secretary during the financial year 2020-21 and ratio of the remuneration of each Director to the median remuneration of employees of the Company for the financial year 2020-21, are as under:

S. No. Name of Director/ KMP and designation Remuneration of Director/ KMP for the financial year 2020- 21 (In Rs.) % increase in remuneration during the financial year 2020-21 Ratio of remuneration of each director to median remuneration of employees
1. Mr. B.S. Raju, Whole Time Director Nil Nil Nil
2. Mr. Deepak Kukreti, Whole Time Director Nil Nil Nil
3. Mr. Rao Sasikanth, Independent Director Nil Nil Nil
4. Mr. Sudi Malyadri, Additional Independent Director Nil Nil Nil
5. Mrs. Neelima Kotagiri, Independent Woman Director Nil Nil Nil
6. Mrs. Soumya Kukreti, Director Nil Nil Nil
7. Mrs. Rajyalakshmi Ankireddy, Additional Director Nil Nil Nil
8. Mr. Jitendra H. Raut, Company Secretary 2,60,625 Nil Nil
9. Mr. S. Anand Reddy, Chief Financial Officer 5,61,249 Nil Nil

(ii) In the financial year, there was no increase in the median monthly remuneration of employees.

(iii) There were eight (8) permanent employees on rolls of the Company as on 31st March, 2021.

(iv) Average percentage increase made in salaries of employees other than the managerial personnel in the last financial year 2019-20 is NIL% whereas increase in managerial remuneration for the same financial year was NIL% and it is hereby affirmed that the remuneration paid is as per the remuneration policy for Directors, Key Managerial Personnel and other Employees.

35. REMUNERATION POLICY:

The Board of Directors, on recommendation of the Nomination & Remuneration Committee (NRC), framed a Nomination and Remuneration Policy for directors appointment and remuneration. The salient features of the said policy includes the criteria for determining qualifications, positive attributes and independence of a director in addition to recommending the remuneration for the directors, key managerial personnel and other employees. The said Policy is available on the companys website at www.midwestgoldltd.com

36. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Board of Directors, on recommendation of the Audit Committee, established a vigil mechanism for Directors and Employees and accordingly adopted the "Whistle Blower Policy" pursuant to the provisions of Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirement)Regulations, 2015, to facilitate Directors and Employees to report genuine concerns or grievances about unethical behavior, actual or suspected fraud or violation to the Companys code of conduct or ethics policy and to provide adequate safeguards against victimization of persons who use such mechanism and to provide for direct access to the Chairman of the Audit Committee in appropriate or exceptional cases. The said policy can be accessed on website of the Company at www.midwestgoldltd.com.

37. A STATEMENT UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:

As the company have less than ten workers and no women employees neither at registered office nor corporate office and the company having no other administrative/ other units, internal committee has not been constituted and no cases were filed/ registered under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal Act, 2013) during the year.

38. GENERAL:

Your directors state no disclosure/reporting is required in respect of the following items, as there were no transactions on these items during the financial year:

(i) Issue of equity shares with differential rights as to dividend, voting or otherwise.

(ii) Issue of Employee stock option Scheme.

(iii) Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

(iv) Whole-time Directors of the Company did not receive any remuneration or commission from any of its subsidiaries.

(v) No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Companys operations in future.

39. OTHER POLICIES UNDER SEBI (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2015:

The Company has also formulated and adopted the following policies as required under Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015:

• Policy for consideration and approval of related party transactions

• Code for independent Directors

• Key Managerial Personnel for determination of materiality

• Archival Policy

• Determination of Materiality of Events

• Preservation of Documents Policy

• Insider Trading Prohibition code

All policies are available on our website at www.midwestgoldltd.com.

40. LISTING:

Your Companys shares are presently listed on Bombay Stock Exchange. The company is regular in payment of listing fee to BSE.

41. DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to the provisions of Sec 134(3)(c) of the Companies Act, 2013 the Board of Directors of your Company hereby certifies and confirms that: i. In the preparation of the Annual financial statements for the financial year ended 31st March, 2021, the applicable accounting standards have been followed along with proper explanation relating to material departures; ii. The Directors had selected such accounting policies and applied them consistently and made judgements 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 loss of the Company for that financial year; iii. The Directors had 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. The Directors had prepared the Annual accounts on a going concern basis; v. The directors, has laid down internal financial control to be followed by the company and that such internal financial controls are adequate and were operating effectively; vi. 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.

42. ACKNOWLEDGEMENTS:

The Board of Directors would like to place on record its appreciation towards all the employees & managerial personnel of the company for their contribution in operations of the company during the year under review. The Directors would also like to record their sincere thanks to the Companys bankers, Central and State Government officials, customers, vendors and the shareholders for their continued support and co-operation.

BY ORDER OF THE BOARD
For MIDWEST GOLD LIMITED
Deepak Kukreti Baladari Satyanarayana Raju
Whole Time Director Whole Time Director
(DIN: 03146700) (DIN: 01431440)
Place: Hyderabad
Date: 12.08.2021