Modulex Construction Technologies Ltd Directors Report.

To

The Members

Modulex Construction Technologies Limited (‘Company)

(Formerly known as Tumus Electric Corporation Limited)

Your Companys Directors are pleased to present the 46th Annual Report of the Company, along with Audited Financial Statements (Standalone & Consolidated), for the Financial Year ended 31st March, 2019.

1. FINANCIAL PERFORMANCE

The standalone and consolidated financial highlights and performance of the Company for the financial year ended March 31, 2019 are given herein below:

(Amt in Rs.)
Particulars

Standalone

Consolidated
Current Financial Year Previous Financial Year Current Financial Year
(2019) (2018) (2019)
Revenue from operations 1,76,447 7,19,976 37,79,544
Profit / loss before Depreciation, Finance Costs, Exceptional Items and Tax Expense (48,43,903) (7,00,603) (7,09,99,325)
Less: Depreciation / Amortisation / Impairment - - (4,66,198)
Profit / loss before Finance Costs, Exceptional Items and Tax Expense (48,43,903) (7,00,603) (714,65,523)
Less: Finance Cost (25,521) (8,386) (57,87,994)
Profit / loss before Exceptional Items and Tax Expense (48,69,424) (7,08,989) (7,72,53,517)
Add / (less) : Exceptional items - - -
Profit / loss before Tax Expense (48,69,424) (7,08,989) (7,72,53,517)
Less : Tax expenses (Current & Deferred) - - -
Profit / (Loss) for the year (1) (48,69,424) (7,08,989) (7,72,53,517)
Total Comprehensive Income / loss (2) - - (50744)
Total (1+2) (48,69,424) (7,08,989) (7,73,04,261)
Balance of profit / loss for earlier years (53,97,760) (46,88,771) (53,97,760)
Less: Transfer to Debenture Redemption Reserve - - -
Less: Transfer to Reserves - - -
Less: Dividend paid on Equity Shares - - -
Less: Dividend paid on Preference Shares - - -
Less: Dividend Distribution Tax - - -
Balance carried Forward (1,02,67,184) (53,97,760) (1,56,64,944)

2. MATERIAL CHANGES AND COMMITMENTS

Consequent upon change in ultimate control in the previous Financial Year to Modulex Modular Buildings Plc, UK and induction of new set of Directors, the Board of Directors of the Company has embarked upon a plan to undertake the business activity of design and manufacturing of carbon neutral, SMART (buildings that using building automation), BOPAS (Build Offsite Property Assurance Scheme, UK) certified steel modular buildings such as residential, commercial, hotels, hospitals etc pursuant to which, the name of company and the object clause of Memorandum of Association was changed with a view to align the name of the Company in tune with the change in objects clause and as part of corporate branding.

As such, during the year under review, the name of the Company was changed to ‘Modulex Construction Technologies Limited from the erstwhile ‘Tumus Electric Corporation Limited. The new name of the Company is more in the line with the nature of the business and takes into cognizance the core values of becoming a technology company offering disruptive offsite construction technology to customers as a one stop solution in the construction sector.

During the year, the registered office of the Company was shifted from Mumbai to Pune. The shifting of the registered office would enable the Directors to monitor the Company more effectively and efficiently and also result in operational convenience.

Save as set out above, your Directors do not foresee any change in the nature of business being pursued by the Company in the current financial year.

3. OPERATIONAL REVIEW

Consequent upon the Company embarking upon a plan to execute the business plan, the Companys subsidiary Modulex Modular Buildings Private Limited (‘MMBPL) is continuing with the construction of a factory facility to produce steel modules and in anticipation of the upcoming commercial operation date of the factory, the Company has started the process of recruiting suitable personnel and leading HR firms, both in India and overseas, have been sounded to that effect.

The factory facility is being developed on a 40 acre land owned by MMBPL in MIDC Indapur. This manufacturing facility, the Directors believe, is the first of its kind in India and the worlds largest modular buildings manufacturing cluster.

The manufacturing facility in the initial phase will see 20 acres being developed consisting of three sheds totalling to circa 35,000 square metres (circa 3,50,000 square feet) which will produce steel modules and ancillary products such as bathroom pods, doors and windows.

The real estate sector and the construction industry is passing through challenging times and to survive and grow in such challenging times, it is imperative that the customers be offered a proposition which adds value. The Company with its unique offering of design and manufacturing of steel modular buildings and the construction thereof through its subsidiary MMBPL is perfectly positioned.

The technology used by MMBPL is franchised from Modulex Modular Buildings Plc, UK and enables the Company to deliver the design and manufacturing (through MMBPL) carbon neutral, Smart, BOPAS certified buildings on fixed cost and time guarantee in nearly half the time and with high quality. The cost of the modular buildings is similar to traditional construction cost.

Going forward, the Company also proposes to develop design templates for various sectors within real estate such as hotels, hospitals, schools, hostels, old age homes etc to offer designing solutions for clients which result in greater speed in delivery of the completed buildings. The Directors are confident that this synchronized solution would create a win-win situation for all stakeholders.

MMBPL had secured investment from large industrial and real estate companies as strategic partners who will be adopting the Companys technology and absorbing a significant portion of the factorys output capacity, thereby underpinning the investment made by the Company in acquiring the shares of MMBPL.

The Company has a significant order pipeline from customers in India and also from customers in the UK for export order.

Directors believe that the Company should see significant activity post completion of the factory in the next financial year.

4. CHANGE IN PROMOTERS AND MANAGEMENT

With a view to acquire Modulex Modular Buildings Private Limited, which is setting up an offsite steel modular building factory, the Board of Directors of the Company vide its approval dated June 23, 2018 and shareholders of the company vide its approval dated August 1, 2018 had considered and approved the proposal of raising funds by issue of shares on preferential basis. Consequent to the shareholder approval, the Board of Directors allotted 4,15,72,186 Equity Shares of face value of Rs. 10/- each, on 26th October, 2018, against Equity Shares of Modulex Modular Buildings Private Limited on preferential basis by way of swap of Equity Shares.

Consequently, Redribbon Modulex Buildings Limited, Mr. Suchit Punnose (Whole Time Director) and Redribbon Advisory Services Private Limited, are designated as new promoters of the Company, within the meaning of Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018.

5. DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mr. Raj Kumar Sharma was appointed as an Additional Director on the board of the Company with effect from August 14, 2019 to hold office till the conclusion of the next Annual General Meeting of the Company and is eligible to be appointed as a Director of the Company. The Company has received notice, under Section 160 of the Companies Act, 2013, from Mr. Suchit Punnose, as a member, signifying its intention to propose the candidature of Mr. Raj Kumar Sharma as a Director of the Company at the forthcoming Annual General Meeting. In accordance with the provisions of Section 160 of the Companies Act, 2013, the Nomination and Remuneration Committee recommends the appointment of Mr. Raj Kumar Sharma. Based on the recommendation of Nomination and Remuneration Committee, the Board considers it in the interest of the Company to appoint Mr. Raj Kumar Sharma as Director of the Company.

During the year under review, Mr. Mahendra Kumar Bhurat, Chartered Accountant, was appointed as Chief Financial Officer of the Company with effect from November 14, 2018.

Mr. Ajay S. Palekar and Mr, Suchit Punnose were appointed as Executive Directors of the Company in its Board Meeting held on March 10, 2019 and were subsequently approved by the Shareholders of the Company through Postal Ballot on April 21, 2019. Mr. Aditya Vikram Kanoria and Mr. Sandeep Khurana as Independent Directors and Ms. Rakhee Agarwal as Independent Woman Director the Company in its Board Meeting held on March 10, 2019 and were subsequently approved by the Shareholders of the Company through Postal Ballot on April 21, 2019.

Mr. Manish Momya resigned as Company Secretary & Compliance Officer of the Company w.e.f. August 14, 2019. Ms. Bhoomi Mewada was appointed as the Company Secretary & Compliance Officer of the Company w.e.f. August 14, 2019.

In accordance with Article 124(a) of the Articles of Association of the Company and the Companies Act, 2013 (‘the Act), one-third of the total Directors, other than Independent, Nominee, Special and Debenture Directors of the Company, retire by rotation at every Annual General Meeting and accordingly, Mr. Ajay Palekar shall retire by rotation at the forthcoming Annual General Meeting and being eligible, offers himself for re-appointment.

6. DECLARATION OF INDEPENDENCE

The Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed under section 149(6) of the Act, and regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations) (including any statutory modification(s) or re-enactment(s) thereof for the time being in force). The independent Directors have complied with the Code for Independent Directors prescribed in Schedule IV to the Act and the code of conduct for Directors and senior management formulated by the Company.

Each of the independent directors have also confirmed to the Company that they are not aware of any circumstance or situation, which exists or may be reasonably anticipated, that could impair or impact his/her/their ability to discharge his/her/their duties with an objective independent judgment and without any external influence and that he/she is independent of the management.

7. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The Familiarisation Programme seeks to update the Independent Directors on various matters covering Companys strategy, business model, operations, organization structure, finance, risk management etc. It also seeks to update the Independent Directors with their roles, rights, responsibilities, duties under the Companies Act, 2013 and other statutes.

The policy and details of familiarization programme imparted to the Independent Directors of the Company is available at https://modulex.in/investor-relations/

8. COMPLIANCE WITH SECRETARIAL STANDARDS

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

9. BOARD MEETINGS

The Board of Directors meet at regular intervals to discuss and decide on Companys operation, business policies or projects to be undertaken and strategy apart from other Board business. However, in case of a special and urgent business need, the Boards approval is taken by passing resolutions by circulation, as permitted by law, which are noted and confirmed at the subsequent Board Meeting.

The notice of Board Meeting is given well in advance to all the Directors. Usually, meetings of the Board are held in Mumbai. The Agenda is circulated a week prior to the date of the meeting. The Agenda for the Board Meetings include detailed notes on the items to be discussed at the meeting to enable the Directors to take an informed decision.

During the financial year ended 31st March 2019, six meetings of the Board were held during the year on 28th May, 2018, 23rd June, 2018, 14th August, 2018, 14th November, 2018, 14th February, 2019 and 18th February, 2019.

The provisions of Companies Act, 2013, Secretarial Standard “SS-1” and the Listing Regulations were adhered to while considering the time gap between two meetings.

10. COMMITTEES OF THE BOARD

The Board Committees play a crucial role in the governance structure of the Company and have been constituted to deal with specific areas / activities; which concern the Company and need a closer review. The Board Committees are set up under the formal approval of the Board to carry out clearly defined roles which are considered to be performed by Members of the Board, as a part of good governance practice. The Board is informed about the summary of the discussions held in the Committee Meetings. The minutes of the meetings of all Committees are placed before the Board for review. The Board Committees can request special invitees to join the meeting, as appropriate.

The Board of Directors of your Company has constituted various Committees, namely:

• Audit Committee

• Nomination and Remuneration Committee

• Stakeholders Relationship Committee

• Securities Committee

• Management Committee

The details of the said Committees established by the Board are set out in the Corporate Governance Report as annexed to this report.

11. COMMITTEE FOR PREVENTION OF SEXUAL HARASSMENT

The Company currently has less than 10 employees and hence the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 are not applicable to the Company. In any event, no complaints were received as to sexual harassment from any employee during the year under review or is pending.

12. BOARD EVALUATION

In terms of the requirement of the Act, and the Listing Regulations, an annual performance evaluation of the Board & Board Committees is undertaken where the Board formally assesses its own performance with the aim to improve the effectiveness of the Board and the Committees. For Independent Directors, evaluation is carried out based on the criteria viz. the consideration which led to the selection of the Director(s) on the Board and the delivery against the same, contribution made to the Board / Committees, attendance at the Board / Committee Meetings, impact on the performance of the Board / Committees, instances of sharing best and next practices, engaging with management team of the Company, participation in Strategy Board Meetings, etc.

During the year, Board Evaluation cycle was completed by the Company internally which included the evaluation of the Board as a whole, Board Committees and peer evaluation of the Directors. The evaluation process focused on various aspects of the functioning of the Board and Committees such as composition of the Board, improving Board effectiveness, performance of Board Committees, Board knowledge sessions and time allocation for strategic issues, etc. Separate exercise was carried out to evaluate the performance of individual Directors on parameters such as attendance, contribution and independent judgment.

As an outcome of the above exercise, it was noted that the Board as a whole is functioning as a cohesive body which is well engaged with different perspectives. The Board Members from different backgrounds bring about different complementarities and deliberations in the Board and Committee meetings. It was also noted that the Committees are functioning well and besides the Committees terms of reference as mandated by law, important issues are brought up and discussed in the Committees.

13. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm that:

• In the preparation of annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

• The Directors have 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 2018-19 and of the loss of the Company for that period;

• The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

• The Directors have prepared the annual accounts on a going concern basis;

• The Directors had laid down proper internal financial controls and such internal financial controls are adequate and were operating effectively; and

• 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.

14. MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to Regulation 34 of the Listing Regulations, a separate section on Management Discussion and Analysis for the year ended March 31, 2019 forms an integral part of this Annual Report.

15. CONSOLIDATED IND AS FINANCIAL STATEMENTS

In compliance with the Regulation 34 of the Listing Regulations and Section 129 of the Act, the Consolidated Financial Statements, which have been prepared by the Company in accordance with the applicable provisions of the Act and the applicable Indian Accounting Standards (IND AS), forms part of this Annual Report.

16. DIVIDEND

Your Directors do not recommend any dividend for the year under review as the Company in view of the Loss that was incurred during the year.

17. TRANSFER TO RESERVES

The Company has not transferred any amount to Reserves for the financial year ended 31st March, 2019.

18. SHARE CAPITAL

During the year, the authorised share capital of the Company was increased from Rs. 2,00,00,000 to Rs. 73,00,00,000, comprises of 7,29,50,000 Equity Shares of Rs. 10 each and 50,000 Cumulative Redeemable Preference Shares of Rs.10 each, approved by the Shareholders of the Company through Postal Ballot on April 21, 2019.

During the year under review, your Company had allotted 4,15,72,186 Equity Shares of face value of Rs. 10/- each, on October 26, 2018, against Equity Shares of Modulex Modular Buildings Private Limited on preferential basis by way of swap of Equity Shares. Since the said shares were issued for consideration other than Cash, the price at which the said shares were to be allotted was determined on the basis of a valuation report of a registered valuer, having been appointed by the Board of Directors of the Company. The provisions of section 247 of the Act and Rules made thereunder were duly complied with.

19. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Details of loans, guarantee(s) or investment(s) made by your Company under Section 186 of the Companies Act, 2013, during the financial year 2018-19 are provided in the Notes to Financial Statements.

20. DEPOSITS FROM PUBLIC

The Company has not accepted any deposit from the Public within the meaning of Section 73 of the Act and the Companies (Acceptance of Deposits) Rules, 2014.

21. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the statutory and secretarial auditors and external consultants and the reviews undertaken by management and the relevant board committees, including the audit committee, the Board is of the opinion that the Companys internal financial controls were adequate and effective during the financial year 2018-19. Even through this non-production period the Company continues to ensure proper and adequate systems and procedures commensurate with its size and nature of its business.

22. RELATED PARTY TRANSACTIONS

In line with the requirements of the Act and amendment to the Listing Regulations, your Company has revised Policy on Related Party Transactions which is also available on the Companys website at https://modulex.in/investor-relations/ The Policy intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions between the Company and Related Parties.

All Related Party Transactions are placed before the Audit Committee for review and approval. All Related Party Transactions entered during the year were in ordinary course of the business and at Arms Length basis. No Material Related Party Transactions, i.e. transactions exceeding 10% of the annual consolidated turnover as per the last audited financial statement, were entered during the year by your Company. The disclosure of Related Party Transactions as required under Section 134(3) (h) of the Companies Act, 2013, in Form AOC-2 is appended as an annexure to this report titled Annexure 1.

23. SUBSIDIARIES AND ASSOCIATE / JV COMPANIES

During the year under review, your Company has acquired 78.59% of the subscribed Share Capital of the Modulex Modular Buildings Private Limited (MMBPL) by way of swap of shares on preferential basis pursuant to which MMBPL has become a Subsidiary of the Company. The Company doesnt have any associates / jointly controlled entity.

A statement containing the salient features of the performance and financial position of the subsidiary company as required under Rule 5 of the Companies (Accounts) Rules, 2014 is provided in Form AOC-1 appended as an Annexure to this report titled Annexure 2.

The Annual Report of the Company containing the standalone and consolidated Ind AS financial statements has been disseminated on the website of the Company at www.modulex.in. Audited Annual financial statements of the Subsidiary Company have also been placed on the said website and are available for inspection by the members at the Registered Office of the Company. Members interested in obtaining copy of the Audited Annual financial statements of the Subsidiary Company may write to the Company Secretary at the Companys Registered Office address.

24. EXTRACT OF ANNUAL RETURN

The extract of annual return in Form MGT-9 as required under Section 92(3) of the Companies Act, 2013 and Rule 12 of the Companies (Management and Administration) Rules, 2014 is appended as an Annexure to this Annual Report titled Annexure 3 and also available on the website of the Company at https://modulex.in/investor-relations/

25. CORPORATE GOVERNANCE

In compliance with the Regulation 34 read with Schedule V of the Listing Regulations, a detailed report on Corporate Governance is given as Annexure and forms an integral part of this Annual Report. A Certificate from the Practicing Company Secretary confirming compliance of the conditions of Corporate Governance as stipulated under the Listing Regulations is appended to the Corporate Governance Report. A Certificate of the CEO and CFO of the Company in terms of Regulation 17(8) of the Listing Regulations is also annexed.

26. ENERGY CONSERVATION MEASURES, TECHNOLOGY ABSORPTION AND R&D EFFORTS AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The requirements under Section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 for disclosure in respect of conservation of energy, technology absorption, are not applicable to the Company. However, the Company takes all possible efforts towards energy conservation. During the period under review, the Company had no Foreign Exchange earnings and outgo.

27. RISK MANAGEMENT

Risk Management is embedded in your Companys operating framework. Your Company believes that managing risks helps in maximizing returns for the stakeholders. The Companys approach in addressing business risks is comprehensive and includes periodic review of such risks and a framework for mitigating controls and reporting mechanism of such risks. The risk management framework is reviewed periodically by the Board and the Audit Committee. Some of the risks that the Company is exposed to are given in Management Discussion and Analysis Report.

28. STATUTORY AUDITORS

During the year under review, the Board of Directors of the Company had appointed M/s. T P. Ostwal LLP, Chartered Accountants, as the Statutory Auditor of the Company to fill the casual vacancy caused due to non-approval for the appointment of M/s. CNK & Associates LLP, Chartered Accountants, by the members at the Annual General Meeting held in the year 2018 .

The Audit Committee recommended to the Board, appointment of M/s. T. P. Ostwal LLP, Chartered Accountants, as the Statutory Auditor of the Company to audit the accounts of the Company for a period of 5 (five) years from 2018-19 onwards. The Company has received a certificate from M/s. T. P. Ostwal LLP, Chartered Accountants, to the effect that their appointment, if effected, would be within limits prescribed under the provisions of the Act. As required under Regulation 33 of the Listing Regulations, the Statutory Auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India

There are no qualifications, reservations or adverse remarks made by the statutory auditors in their audit reports on the standalone financial statements (for the year ended March 31, 2019) though there are certain qualifications, reservations or adverse remarks made by the statutory auditors in their audit report on the consolidated financial statements.

Qualified Opinion by Auditors in Consolidated Financial Statements and Replies of Management thereon:

The qualifications to audit opinion of the financial statements of Modulex Modular Buildings Private Limited, issued by an independent firm of Chartered Accountants vide its report dated November 12, 2019 and reproduced by the Statutory Auditors of the Company in the Auditors Report are appended below along with the replies of the management thereon:

Statutory Auditors Report Managements Reply
i. During the year the company has issued 60.00. 000 equity shares of Rs. 10/- each, fully paid up amounting to Rs.6,00,00,000, to a vendor for consideration other than cash. Post the financials were authorized for issue, the vendor has confirmed allotment of only 30.00. 000 equity shares. Based on this, the Company has cancelled the allotment of 30.00. 000 equity shares of Rs. 10/- each and accordingly has filed the revised and rectified returns with the Registrar of Companies. As a result of this, the issued and paid up capital of the Company is overstated by an amount of Rs. 300,00,000. Refer foot note to Note 13(e). Extract from confirmation letter issued by Reward Constructions Private Limited on 10.09.2019 is given below in verbatim: “We are writing to confirm that we had agreed to accept payment in the form of equity shares for construction works carried out at the factory site of Modulex based on our assessment of the project to be a viable project with long term prospect for increase in the value of shares. However, owing to delays in Modulex closing debt, which we believe is a consequence of general environment of the debt market in India, our view has changed and we have not adjusted our account with this payment in the form of shares”.
ii. The company, based on certain RA bills submitted by the above mentioned vendor has booked Rs. 3,27,69,435 as Capital WIP for its undergoing construction plant at Indapur, Extract from balance confirmation statement dated 10.11.2019 issued by Reward Constructions Private Limited is below in verbatim:
Maharashtra and issued equity shares for consideration other than cash as mentioned in para (a) above. Post the financials were authorized for issue, the confirmation received from the said vendor did not contain the said RA bills. Accordingly, the Company has reduced the capital WIP by the said amount. As a result of this the capital WIP as disclosed in Note 4 of the financial statements is overstated by an amount of Rs. 3,27,69,435. “The amount of Rs.5,00,23,353/- above includes the said amount of Rs.3,27,69,435 reversed earlier due to non-acceptance of payment in the form of equity shares”
iii. The company has transferred 5,08,580 partly paid equity shares as fully paid up shares without recording the calls receivable in the financial statements for the year ended 31st March 2019. As a result of this, the issued and paid up capital and calls receivable of the company is understated by Rs. 50,34,942/- This was due to inadvertent clerical error arising from filings related to the preferential allotment by the said company. Monies against calls receivable has been received in full as on the date of this report. The Company has engaged the services of competent finance professional to avoid repetition of clerical errors in future.
iv. There is a difference between the number of shares held by the holding company (Modulex Construction Technologies Ltd ‘MCTL) in the company as per MCTLs records and as per the records of the company. This is due to the fact, during the year MCTL has allotted 3,81,473 equity shares of Rs 10 each, fully paid up amounting to Rs. 38,14,730 against 5,10,790 equity shares of Rs 10 each held in the company by two shareholders of the company in the ratio of 1:1.34 based on the scheme of swap of shares as approved by BSE by letter dated 12th October, 2018. However, the above 5,10,790 equity shares of Rs 10 each were only subsequently allotted, post the financials were authorized for issue. Such subsequent allotment has been made against invoices for providing consultancy services and project management services by the said parties. As a result of this, the issued and paid up capital of the company is understated and the loss for the year is understated by an amount of Rs. 51,07,900. The services invoices related to the difference was not recorded in the books of the said company due to inadvertent clerical error, which has been rectified. The Company has engaged the services of competent finance professional to avoid repetition of clerical errors in future.

29. INTERNAL AUDITOR

Pursuant to the provisions of Section 138 of the Companies Act, 2013 and rules made thereunder, the Company has appointed M/s. RMJ & Associates LLP, Chartered Accountants as Internal Auditor of the Company on May 29, 2019 to conduct Internal Audit of records and documents of the Company for the financial year 2019-20. M/s RMJ & Associates, Chartered Accountant resigned from the position of internal auditor w.e.f. November 14, 2019 due to pre occupation.

30. SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules made thereunder, the Company has appointed Ms. Sonam Jain, Practicing Company Secretary, as Secretarial Auditor of the Company on May 29, 2019 to conduct Secretarial Audit of records and documents of the Company for the financial year 2018-19. The Secretarial Audit Report confirms that the Company has generally complied with the provisions of the Act, Rules, Regulations, and Guidelines etc. and there were no secretarial audit qualification(s) for the year under review.

The Secretarial Audit Report is annexed as an Annexure to this report titled Annexure 4 and forms an integral part of this report.

31. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company believes in the conduct of the affairs of its constituents in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity and ethical behavior. Pursuant to Section 177(9) of the Act, a vigil mechanism is established for directors and employees to report to the management instances of unethical behavior, actual or suspected, fraud or violation of the Companys code of conduct or ethics policy. The Vigil Mechanism provides a mechanism for employees of the Company to approach the Chairman of the Audit Committee of the Company. Vigil Mechanism Policy to this effect is also uploaded on the website of the Company i.e. https://modulex. in/wp-content/uploads/2019/04/Whistle-Blower-Policy-MCTL.pdf

32. REMUNERATION POLICY

In terms of the provisions of Section 178(3) of the Act, the Nomination and Remuneration Committee (NRC) is responsible for formulating the criteria for determining qualification, positive attributes and independence of a Director. The NRC is also responsible for recommending to the Board a policy relating to the remuneration of the Directors, Key Managerial Personnel and other employees. The Board has on the recommendation of the NRC framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The said policy is available on the Companys website at https://modulex.in/wp-content/uploads/2019/04/Remuneration-Policy-MCTL.pdf

33. PARTICULARS OF EMPLOYEES

There were no employees during the year under review, whose particulars are required to be given in the Boards Report in accordance with the provisions of Section 197 of the Act read with Rule 5(1) & 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time.

There were 2 permanent employees on the rolls of the Company as on 31.03.2019

34. REMUNERATION OF THE DIRECTORS AND KEY MANAGERIAL PERSONNEL

The remuneration details of Directors Key Managerial Personnel is mentioned in the extract of annual return i.e. MGT-9 annexed as an Annexure to this report titled Annexure 5.

35. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATOR OR COURT

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

36. MAINTENANCE OF COST RECORDS

The provisions of Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014, are not applicable and as such your Company is not required to appoint Cost Auditor or to maintain Cost records.

36. CORPORATE SOCIAL RESPONSIBILITY

Provision of Section 135 of the Act relating to Corporate social responsibility is not applicable on the company for the year under review.

37. ACKNOWLEDGEMENTS

Your Directors would like to express their sincere appreciation for the co-operation and assistance received from shareholders, bankers, regulatory bodies and other stakeholders during the year under review.

Your Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers and staff, resulting in unflinching focus on business establishment and growth of the Company during the year.

For and on behalf of the Board of Directors of

Modulex Construction Technologies Limited

(Formerly known as Tumus Electric Corporation Limited)

Suchit Punnose Ajay Palekar
Whole Time Director Managing Director
DIN:02184524 DIN: 02708940
Place: Mumbai
Date: November 14, 2019