Purohit Construction Ltd Directors Report.

To,

The Members,

PUROHIT CONSTRUCTION LIMITED

Your Directors have pleasure in presenting 28th Annual Report together with the Audited Financial Statements and Auditors Report thereon for the year ended 31st March, 2019.

1. FINANCIAL RESULTS:

Rs. in Thousands

Particulars Standalone
For the year ended March 31,2019 For the year ended March 31,2018
Total Income (incl. Other Income) 33192 169685
Financial Expenses 53 76
Depreciation 1826 2629
Profit/ (Loss) Before Taxation 574 977
Less: Provision for Income Tax 440 836
Less: Provision for Deferred Tax (245) (482)
Profit After Taxation 379 623
Less: Prior Period adjustment - -
Transfer to General Reserve - -
Surplus Brought Forward 12350 11656
Net Balance carried to balance Sheet 13926 13547

2. OPERATIONS/STATE OF AFFAIRS :

The Company has competed all the projects on hand during the year under review and due to economic downturn the turnover of the Company has been reduced from Rs. 169239 Thousands in previous year to Rs. 32493 Thousands in current year. Consequently, the Profit before tax of the Company has been declined from Rs. 977 Thousands to Rs. 574 Thousands and Profit after Tax from Rs. 623 Thousands to Rs. 379 Thousands in the current financial year.

3. DIVIDEND :

Since the Company needs to plough back the profits for the future development and expansion, dividend payment cannot be considered. Therefore your Directors have not recommended any dividend for the financial year.

4. AMOUNT TRANSFERRED TO RESERVES:

During the year, Company has not transferred any amount to Reserves.

5. DEPOSITS:

The Company has not accepted any deposit from public during financial year.

6. MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY FROM THE CONCLUSION OF THE FINANCIAL YEAR TILL THE DATE OF THIS REPORT:

No material changes or commitments, affecting the financial position of the Company have occurred between the end of the financial year of the Company, to which the financial statements relate, i.e. 31st March, 2019 and the date of the Boards Report.

7. CHANGE IN THE NATURE OF BUSINESS:

During the year under review, there was no change in the nature of the business.

8. CHANGES IN SHARE CAPITAL:

During the year under review, there was no change in the Companys issued, subscribed and paid – up equity share capital. On March 31, 2019, it stood at Rs.44, 056,000/- consisting of 4405600 equity shares of Rs.10/- each.

9. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

9.1 Mr. Narendra Purohit, Managing Director of the Company will retire by rotation at the ensuing Annual General Meeting and, being eligible, has offered himself for reappointment.

The Board recommends the re-appointment of above Director by passing of the necessary resolution.

During the year under review, Shri Saumil Purohit has been appointed as a Chief Financial Officer w.e.f. 14th February, 2019 in place of Shri Sanny Parante.

Due to old age, Shri Kumudchandra Sheravia has resigned as a Director of the Company w.e.f. 29th March, 2019. The Board places on record the valuable contribution given by him during his tenure as a Director.

9.2 Declaration by Independent Directors

The Independent Directors of the Company viz. Mr. Mahendra Sanghani, Mr. Nishitkumar Gohil, and Mrs. Jagrutiben Shah have given declaration to the Company that they qualify the criteria of independence as prescribed under Section 149 (6) of the Companies Act, 2013 and Regulation 16(1) (b) of the SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015.

9.3 Policy on Appointment and Remuneration of Directors, KMP and Senior Management Personnel.

The Policy of the Company on Directors Appointment and remuneration of Directors Remuneration of Key Managerial Personnel and other employees of the company pursuant to sub – Section(3) of Section 178 is appended as Annexure -1 to this Report. The Policy has been posted on the website of the Company http://www.purohitconstruction.com/ InvestorRelations.aspx

9.4 Formal Annual Evaluation Process by Board;

The Company has in place a formal mechanism for evaluating its performance as well as that of its Committees and individual Directors, including the Chairman of the Board. The Board after taking into consideration the criteria of evaluation laid down by the Nomination and Remuneration Committee in its policy such as Board Composition, level of involvement, performance of duties, attendance etc. had evaluated its own performance, the performance of its committees and Independent Directors (excluding the Director being evaluated) and that of the Chairman and the Non-Independent Directors was carried out by the Independent Directors in their separate meeting held.

The Board of Directors was satisfied with the evaluation results, which reflected the overall engagement of the Board and its Committees with the Company.

9.5 Familiarization Programme for Independent Directors:

The Familiarization 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 and other statutes. The policy and details of familiarization programme imparted to the Independent Directors of the Company has been kept on the website of the Company at the link: http://www.purohitconstruction.com/InvestorRelations.aspx

10. DIRECTORS RESPONSIBILITY STATEMENT:

In terms of section 134 (5) of the Companies Act, 2013, in relation to financial statements for the year the Board of Directors state that:

(a) In the preparation of Annual Accounts for the period ended March 31, 2019, the applicable accounting standards have been followed along with proper explanation relating to material departures.

(b) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the Profit of the Company for the year ended March 31, 2019.

(c) The Directors have 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 have prepared the annual accounts on a going concern basis.

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

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

11. NUMBER OF MEETINGS OF BOARD:

During the year under review, six meetings of the Board of Directors were held on (1) 30th May, 2018 (2) 14th August, 2018 (3) 14th November, 2018 (4) 8th January, 2019 (5) 29th January, 2019 and (6) 14th February, 2019. All the Directors remained present in all the Board meetings. This intervening gap between any two meetings was within the period prescribed by the Companies Act, 2013.

12. DISCLOSURE UNDER RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014:

Details pertaining to remuneration and other details as required under Section 197 (12) of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as Annexure 2 to this report.

In terms of provisions of Section 136(1) of the Act, the Annual Report excluding the disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is being sent to the members of the Company. The said information is open for inspection at the registered office of the Company during working hours and any member interested in obtaining such information may write to the Company Secretary and the same will be furnished on request.

13. PARTICULARS OF CONTRACT OR ARRANGEMENT WITH RELATED PARTY :

All Transaction entered into with the Related Parties during the financial year under the review were on an arms length basis and were in the ordinary course of business.

The Policy on materiality of related Party transactions and dealing with related party transactions as approved by the Board may be accessed on the Companys website http://www.purohitconstruction.com/InvestorRelations.aspx

The summary of related party transaction is given in AOC-2 is annexed herewith as Annexure – 3 which forms part of this report.

14. AUDITORS AND AUDITORS REPORT:

The present statutory auditors M/s. Saurabh R Shah & Co., Chartered Accountants (Firm Regn. No. 127176W), Ahmedabad have tendered their resignation with effect from 29th July, 2019.

The Board of Directors at its meeting held on 29th July,2019 appointed M/s. Parekh Parekh and Associates, Chartered Accountants (Firm Reg. No. 132988W), Ahmedabad as Statutory Auditors of the Company. The Board recommends their appointment as per the resolution appended in the notice.

15. INTERNAL AUDITOR:

The Board on the recommendation of Audit Committee had appointed M/s. Paresh Rupabhinda & Associates, Chartered Accountants (FRN: 135056W) as an Internal Auditors for the financial year 2018-19.

16. INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has a proper and adequate system of internal control in all spheres of its activities to ensure that all its assets are safeguarded and protected against loss from unauthorized use or disposition and that the transactions are authorized, recorded and reported diligently.

The Company ensures adherence to all internal control policies and procedures as well as compliances with all regulatory guidelines.

The Audit Committee of the Company periodically reviews the adequacy of internal financial controls.

17. SECRETARIAL AUDIT REPORT:

Pursuant to the provisions of section 204 of the Companies Act, 2013, the Board has appointed M/s. Parikh Dave & Associates, Company Secretaries, to undertake Secretarial Audit of the Company.

A report from Secretarial Auditor is annexed to this Report herewith as Annexure- 4. The same does not contain any qualification, reservation or adverse remark or disclaimer.

18. SECRETARIAL STANDARDS:

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

19. INDUSTRIAL RELATIONS:

The Company has maintained cordial relations with the employees of the Company throughout the year. The Directors wishes to place on record sincere appreciation for the services rendered by the employees of the Company during the year.

20. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE:

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.

21. RISK MANAGEMENT:

The Company has formulated the Risk Management Policy in order to safeguard the organization from various risks through timely actions and to mitigate the effect of risk bearing impact on the Business.

In the opinion of the Board there has been no identification of element of Risk that may threaten the existence of the Company.

22. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

Details of Loans, Guarantees, Investment and Advances made if any, are described in notes to the Financial Statement.

23. EXTRACT OF ANNUAL RETURN:

As required by the provisions of Section 134(3)(a) of the Companies Act, 2013 and relevant rules made there under, the extract of the annual return as provided under sub-section (3) of section 92 is attached herewith Annexure 5.

24. CORPORATE GOVERNANCE REPORT, MANAGEMENT DISCUSSION & ANALYSIS

Pursuant to Regulation 15 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, provision of Regulations 17 to 27 and clauses (b) to (i) of sub-regulation (2) of regulation 46 and para C, D and E of Schedule V does not apply to the Company. Hence, report on Corporate Governance does not form part of the Directors report. Report on Management Discussion and Analysis Report is given herewith as a Annexure 6.

25. AUDIT COMMITTEE:

During the year, the Audit committee consists of three Members, Shri Mahendra Sanghani (designated as Chairman of the committee), Shri Nishit Gohil and Shri Kumudchandra Sheravia (ceased w.e.f. 29/03/2019) and Smt. Jagrutiben Shah (appointed w.e.f. 29/03/2019) . During the year under review, 4 committee meetings were held on (1) 30/05/2018 (2) 14/08/2018 (3) 14/11/2018 and (4) 14/02/2019 which have been attended by all the three members.

The recommendations of Audit Committee were duly accepted by the Board of Directors.

26. NOMINATION AND REMUNERATION COMMITTEE:

The Nomination and Remuneration Committee consists of three members Shri Mahendra Sanghani (Chairman of the Committee), Shri Nishit Gohil and Shri Kumudchandra Sheravia (ceased w.e.f. 29/03/2019) and Smt. Jagrutiben Shah (appointed w.e.f. 29/03/2019)

During the year, the Committee met one time on: 14th February, 2019 which has been attended by all the three members.

27. SUBSIDIARIES COMPANIES , ASSOCIATES AND JOINT VENTURE COMPANIES:

The Company doesnt have any Subsidiaries, Associates or Joint Venture Companies.

28. SAFETY, HEALTH AND ENVIRONMENT:

(a) Safety: The Company encourages a high level of awareness of safety issues among its employees and strives for continuous improvement. All incidents are analysed in the safety committee meetings and corrective actions are taken immediately. Employees are trained in safe practices to be followed at work place.

(b) Health: Your Company attaches utmost importance to the health of its employees. Periodic checkup of employees is done to monitor their health. Health related issues if any are discussed with visiting Medical Officer.

(c) Environment: Company always strives hard to give importance to environmental issues in normal course of operations. Adherence to Environmental and pollution control Norms as per Gujarat Pollution Control guidelines is of high concern to the Company.

29. VIGIL MECHANISM/WHISTLE BLOWER POLICY:

Pursuant to Section 177 of the Companies Act, 2013 the rules made thereunder and the Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has established a Vigil Mechanism for directors and employees to report genuine concerns about any instance of any irregularity, unethical practice and/or misconduct. The policy is posted on the website of the Company http://www.purohitconstruction.com/InvestorRelations.aspx

30. MAINTENANCE OF COST RECORDS:

The Company is not required to maintain any cost records prescribed under section 148 of the Companies Act, 2013 and rules made thereunder.

31. DISCLOSURES UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE:

Considering gender equality, the Company has zero tolerance for sexual harassment at workplace. The Company has an Anti Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

No complaints were received during the year 2018-19:

This policy posted on the website of the http://www.purohitconstruction.com/InvestorRelations.aspx

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

The Statement of particulars with respect to Conservation of Energy, Technology Absorption and Foreign Exchange Earning and Outgo pursuant to provisions of 134 of the Companies Act, 2013 is given in Annexure-7 to this Report.

33. CODE OF CONDUCT:

The Company has laid down a Code of Conduct applicable to the Board of Directors and Senior management which is available on Companys website. All Board members and senior management personnel have afirmed compliance with the Code of Conduct.

34. CODE OF FAIR DISCLOSURE:

As required under the new Insider Trading Policy Regulations of SEBI, your Directors have framed new Insider Trading Regulations and Code of Internal Procedures and Conducts for Regulating, Monitoring and Reporting of Trading by Insider. For details please refer to the companys website on following link http://www.purohitconstruction.com/InvestorRelations. aspx.

35. ENHANCING SHAREHOLDERS VALUE:

Your Company believes that its Members are among its most important stakeholders. Accordingly, your Companys operations are committed to the pursuit of achieving high levels of operating performance and cost competitiveness, consolidating and building for growth, enhancing the productive asset and resource base and nurturing overall corporate reputation. Your Company is also committed to creating value for its other stakeholders by ensuring that its corporate actions positively impact the socio-economic and environmental dimensions and contribute to sustainable growth and development.

36. INSURANCE:

The Company has taken adequate insurance to cover its assets.

37. LISTING:

Your companys shares are listed with The BSE Limited, Mumbai. (Stock Code: - 538993) and Ahmedabad Stock Exchange Limited (scrip code: - PCL). The Company has already paid Annual Listing fees to BSE Limited.

38. CAUTIONARY STATEMENT:

Statements in the Boards Report and the Management Discussion & Analysis describing the Companys objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Companys operations include global and domestic demand and supply conditions affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

39. ACKNOWLEDGMENTS:

Your Company and its Directors wish to extend their sincerest thanks to the Members of the Company, Bankers, State Government, Local Bodies, Customers, Suppliers, vendors and other business partners for the excellent support received from them during the year. The Directors place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued contribution to the Company.

FOR AND ON BEHALF OF THE BOARD
FOR PUROHIT CONSTRUCTION LIMITED
Narendra Purohit
Date:19th August, 2019 Chairman & Managing Director
Place: Ahmedabad (DIN: 00755195)