Railtel Corporation of India Ltd Directors Report

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Railtel Corporation of India Ltd Share Price directors Report

Dear Shareholders,

Your Companys Directors are pleased to present 23rd Annual Report of the Company, together with the

Auditors Report and Comments of the Comptroller and Auditor General of India ("C&AG"), for theFinancial Year ended 31st March, 2023 prepared in accordance with the provisions of the Companies Act, 2013 read with rules made thereunder and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015-["Listing Regulations"] as amended from time to time.

1. Company Overview

RailTel Corporation of India Limited ("RCIL") is one of the largest neutral telecom infrastructure providers in the country owning a Pan-India optic fiber network along Railway track. The biggest USP of RCIL is its ownership of a Pan-India 61000+ RKM of Optic fiber network which covers all important towns & cities of the country and several rural areas covering 70% of Indias population. RCIL with strong nationwide presence is committed to bring cutting edge technology and offer innovative services the Indian Telecom market. With its Pan-India high-capacity network, RCIL is working towards creating a knowledge society at various fronts.

Equipped with ISO-9001-2008, ISO-27001:2005 and ISO 20000-1:2011 certification, RCIL offers a wide gamut of managed telecom services to Indian Telecom market. The service includes RCIL e-office, Managed lease lines, Tower MPLS based IP-VPN, Internet, Data Center services, HD Video Conferencing Services, NGN based voice carriage services to Telecom Operators, Services to Internet Service Providers, MSOs, Enterprises, Banks, Government Institution/ Departments, Educational Institutions /Universities, PSUs etc. RCIL being a "Mini Ratna (Category-I)" PSU is steaming ahead in the enterprise segment with the launch of various services coupled with capacity augmentation in its Core network. Your company stands as the only telecom PSU, which is a 100% debt free company and consistently profit-making PSU in telecom sector.

2. Financial Highlights

During the year, your Company has achieved total consolidated turnover of Rs. 2002.20 Crore. The Company has observed an increase of 27.93% in its revenue from operations which comes out to be Rs. 1946.52 Crore on standalone basis. The total turnover of the Company during the year is Rs.2002.20 Crore comprising of other income of Rs.38.68 Crore.

The summarized financial results of your Company are shown in Table 1.

3. Listing of Shares

The equity shares of the Company got listed on 26/02/2021 on National Stock Exchange of India Limited ("NSE") and BSE Limited ("BSE"). The Scrip Code for equity shares of RCIL assigned by BSE is 543265 and Scrip Symbol assigned by NSE is

RAILTEL.

4. Share Capital

There is no change in the capital structure of the Company during the period under review and from the end of the FY till the date of this report.

Accordingly, Issued, Subscribed and Paid-up Share Capital is 320.94 crore divided into 32.09 crore Equity Shares of 10 each as on 31st March, 2023, including 305.94 crore issued for consideration other than cash.

The details of dematerialization of shares, Demat Suspense Account/Unclaimed Suspense Account is provided in the Corporate Governance Report as annexed to this report.

Table1: Financial Highlights of Company

(In Crore)

Particulars

Year ended Year ended Year ended Year ended
31/03/2023 31/03/2022 31/03/2023 31/03/2022
Consolidated Standalone

Total Revenue

-Revenue from Operations 1963.51 1548.45 1946.52 1521.54
-Other Income 38.68 29.28 34.15 25.94
Expenditure 1745.36 1347.21 1726.03 1318.11
Depreciation 154.31 160.18 154.27 160.13

Profit Before Interest, Tax &

256.84 230.52 254.64 229.37

Exceptional items

Interest 0 0 0 0
Exceptional Items 2.06 -50.10 2.06 -50.18
Tax/ Others 65.71 71.67 65.20 71.22

Profit for the Year

189.07 208.94 187.38 208.34
Basic EPS (In ) 5.89 6.51 5.84 6.49

5. Dividend

Your Company has a consistent track-record of dividend payment. The Board of Directors of your

Company had earlier approved payment of an Interim Dividend of 1.50 per share amounting to 48.14 Crore for the FY 2022-23. Further, the Board has recommended payment of final dividend of 1.05 per share amounting to 33.69 Crore for the FY 2022-23. The total dividend payment for the FY 2022-23 would be 81.83 as compared to 77.02 crore paid for the FY 2021-22. In terms of Regulation 43A of Listing Regulations and the guidelines on "Capital Restructuring of Central Public Enterprises" issued by the DIPAM, the Board of Directors of the Company has formulated and adopted the Dividend Distribution Policy. The said Policy is annexed to this report at Page No. 72 and is also available on the Companys website i.e. www.railtelindia.com

6. Railways Revenue Share

The Company is also contributing by way of revenue share @ 7 % on services to Indian Railways and the total share of such contribution comes to 41.93 Crore as against such share of 39.72 Crore in the preceding year. The cumulative revenue share to

Railways amounting to 380.93 Crore till this year. Besides, the Company has also paid license fee @ 8% (at present) to DoT, Govt. of India on its income from telecom business carried by it under licenses granted to it.

7. Reserves

The Company appropriated its profit earned during the year under review. The Company has not transferred any amount to the General Reserves during the year. The total reserves & surplus at the end of the FY 2022-23 is 1,316 Crore (on Standalone basis).

8. Capital Expenditure

During the year, Capital expenditure of 182 Crore approx. was incurred mainly on OFC related assets,Telecom & Radio equipments etc. The Company made commitments to the tune of 145.22 Crore on capital account and accordingly, expenditure would be booked during the current financial year, in addition to the capital expenditure allocated for FY 2022-23.

9. Declaration from Independent Directors

RCIL has received a declaration from its Independent Directors stating that they have met the criteria of independence under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) read along with Regulation 25(8) of Listing Regulations and are not disqualified from continuing as Independent Directors. There is no extension of any Independent Director for a term exceeding Five (5) years as per Section 149(10) of the Companies Act, 2013.

10. Number of Meetings of Board

The Board met Eight (8) times for transacting the business of the Company during the FY 2022-23 i.e., on 04/05/2022, 24/05/2022, 09/07/2022, 10/08/2022, 29/09/2022, 10/11/2022, 31/01/2023 and 22/03/2023. The particulars of the meetings held and attended by Directors are detailed in the Corporate Governance Report as annexed to this report.

11. Details of changes in Directors and other Key Managerial Personnel:

The following changes took place in the Board/Key

Managerial Personnel of the Company during the year and up-to date of Report:

Appointment of directors: -

1. Shri Rakesh Ranjan was appointed as Part-time Govt. Nominee Director w.e.f. 18/04/2022. Further, he has been entrusted with the additional charge of the post of Director/ Network, Planning and Marketing w.e.f. 06/10/2022 till 04/07/2023.

2. Smt. Aruna Singh was entrusted with the additional charge of the post of Chairman & Managing Director w.e.f. 11/05/2022 till 23/09/2022.

3. Shri Sanjai Kumar has been appointed as Chairman & Managing Director w.e.f. 23/09/2022.

4. Shri Vikas Kumar Jain has been appointed as Part-time Govt. Nominee Director w.e.f. 19/09/2022 till 30.01.2023.

5. Shri Rabindra Nath Mishra has been entrusted with the additional charge of the post of Director/ Finance w.e.f. 07/10/2022 till 26/10/2022.

6. Shri V. Rama Manohara Rao has been appointed as Director/Finance w.e.f. 27/10/2022.

7. Shri V. Rama Manohara Rao has been appointed as Chief Financial Officer w.e.f. 10/11/2022.

8. Shri Rameshwer Meena has been appointed as Part-time Govt. Nominee Director w.e.f. 17/03/2023.

9. Shri Manoj Tandon has been appointed as

Director/Project, Operations and Maintenance w.e.f. 20/03/2023.

10. Shri Yashpal Singh Tomar has been appointed as Director/Network Planning and Marketing w.e.f. 04/07/2023.

Cessation of Directors: -

1. On completion of tenure, Shri Puneet Chawla ceased to be Chairman & Managing Director w.e.f. 11/05/2022.

2. On completion of tenure, Shri Chinnsamy Ganesan ceased to be Part-time non-official/ Independent Director w.e.f. 12/07/2022.

3. On completion of tenure, Shri V. Shanker ceased to be Part-time Govt. Nominee Director w.e.f. 08/08/2022.

4. On appointment of Shri Sanjai Kumar as full time Chairman & Managing Director, Smt.

Aruna Singh who has been entrusted with the additional charge of the post of Chairman &

Managing Director, ceased to be Chairman & Managing Director w.e.f. 23/09/2022.

5. On being elevated to the post of Chairman & Managing Director, Shri Sanjai Kumar ceased to be Director/Network, Planning and Marketing w.e.f. 23/09/2022.

6. On completion of tenure, Shri Anand Kumar Singh Singh ceased to be Director/Finance and Chief Financial Officer w.e.f. 01/10/2022.

7. On appointment of Shri V. Rama Manohara Rao as full time Director/Finance, Shri Rabindra

Nath Mishra who has been entrusted with the additional charge of the post of Director/ Finance, ceased to be Director/Finance w.e.f. 27/10/2022.

8. On transfer of Shri Vikas Kumar Jain from the post of ED/ GS (Civil)-I/ Railway Board, he ceased to be Part-time Govt. Nominee Director w.e.f. 30/01/2023.

9. On appointment of Shri Yashpal Singh Tomar as full time Director/Network Planning and Marketing, Shri Rakesh Ranjan, who has been entrusted with the additional charge of the post of Director/Network Planning and Marketing ceased to be Director/Network Planning and Marketing and is continuing as part time govt. nominee director w.e.f. 04/07/2023.

12. Retirement of Director by Rotation

In terms of the Companies Act, 2013, the provisions with respect to retirement of Directors by rotation will not be applicable to the Independent Directors of the Company. In view of this, no Independent Director is being considered to be retired by rotation. The Part-time Govt. nominee directors were considered as directors not liable to retire by rotation but other directors (i.e. functional directors) will be retiring by rotation. Accordingly, Shri V.

Rama Manohara Rao is liable to retire by rotation and being eligible, offers himself for reappointment

13. Remuneration to Directors

RCIL, being a Government Company under the provisions of the Companies Act, 2013, the Directors of the Company are appointed by the President of India acting through Ministry of Railways ("MoR"), Government of India. The functional Directors are appointed by the Government of India who draw remunerations under Industrial Dearness Allowance pattern of pay scale except in case of Shri Puneet Chawla Ex-CMD, who was on deputation to RCIL from MoR and was drawing Central Dearness

Allowance pay scales as pre-determined by the Government and as per the terms and conditions of their appointment issued by the Government of India from time to time.

The Part time Government Nominee Directors on the Board of the Company do not draw any remuneration from the Company.

The Part-time non-official Directors/Independent Directors are paid a sitting fee of 20,000 per meeting for attending meetings of Board or

Committees thereof, besides cost of travel and lodging in case of outstation Directors.

14. Policy on Performance Evaluation of Directors

RCIL is a Government Company under the administrative control of MoR. The functional directors including Chairman and Managing

Director are selected on the recommendations of

Public Enterprises Selection Board in accordance with the procedure and guidelines laid down by Government of India.

The Company enters into Memorandum of Understanding ("MoU") with the Administrative

Ministry, i.e., MoR every year, containing key performance parameters for the company. The performance of the Company is evaluated by Department of Public Enterprise vis-a-vis MoU entered into with the MoR.

The evaluation of performance of Functional Directors includes self-evaluation by the respective functional directors and subsequent assessment by CMD with final evaluation by the MoR (the administrative ministry).

The performance evaluation of CMD includes self-evaluation and final evaluation by the MoR. In respect of Part-time Government nominee directors, their evaluation is done by the MoR as per the procedure laid down. Since, Independent Directors are appointed by the administrative Ministry, their evaluation is also done by the MoR and Department of Public Enterprises ("DPE").

Ministry of Corporate Affairs "MCA" ( ) vide its circular dated June 5, 2015 had exempted

Government Companies from the provisions of section 178(2) of the Companies Act, 2013, which requires performance evaluation of every director by the Nomination & Remuneration Committee. The circular further exempted Government Companies from the provisions of Section 134

(3) (p) of Companies Act 2013, if directors are evaluated by the Ministry which is administratively in-charge of the Company as per its own evaluation methodology.

Further, MCA vide its notification dated 5 th July, 2017 has exempted the provisions relating to review of performance of Chairperson and non-independent directors and the Board as a whole from evaluation mechanism, prescribed in Schedule IV of the Companies Act, 2013, for Government Companies.

15. Committees of the Board

As on March 31, 2023, the Board had five committees namely the Audit Committee, the Nomination & Remuneration Committee, the Corporate Social Responsibilities Committee, the Stakeholders Relationship Committee and the Risk Management

Committee. The detailed note on the composition of the Board and its committees are provided in the Corporate Governance Report section of this Annual Report and the details of the Committees of the Board is also available on the website of the Company i.e., www.railtelindia.com

16. Subsidiary

Your Company has a wholly owned subsidiary by the name of RailTel Enterprises Limited ("REL") incorporated on 12th August, 2014 under the provisions of the Companies Act, 2013. The authorised share capital of REL is 50 Crore and paid-up share capital is 10 Crore. The entire equity share capital of REL is held by RCIL through its nominees. The affairs of the Company are managed, controlled and supervised by three Directors nominated by RCILs Board. The Company has filed an application for amalgamation of REL with RCIL which is pending for approval before the MCA.

During the year under review, no company has become or ceased to be subsidiary/ joint venture/ associate Company of RCIL.

The Consolidated Financial Statements of the Company duly audited by the Statutory Auditors are presented in the Annual Report.

A report on performance and financial position of the subsidiary is presented in a separate section of this Annual Report. Please refer Form AOC-1 annexed to the consolidated Financial Statements in the Annual Report.

17. Projects Undertaken

The details of the projects undertaken during the year are included in Management Discussion &

Analysis Report which is forming part of this Annual report.

18. Procurement from Micro and Small Enterprises

The Govt. of India has notified a Public Procurement

Policy for Micro and Small Enterprises ("MSE") Order, 2012. In terms of said policy and issued guidelines, a mandatory procurement of a minimum of 25% of total annual procurement is required from Micro and Small Enterprises. Out of 25% target of annual procurement from MSEs, sub targets of 4% from

MSEs owned by Schedule Caste or Scheduled Tribe

Entrepreneurs and 3% from MSEs owned by Women Entrepreneurs are also earmarked for procurement.

The achievement of procurement target from MSEs during the financial year 2022-23 in compliance to the aforementioned Public Procurement Policy is shown in Table-2.

Sl.

Particulars

2022-23 ( in Cr.)
1 Total annual procurement (in value) 513.47
2 Total value of procurement from MSEs 277.88
3 % age of procurement from MSEs (including SC/ST and women) 54.12
4 Total value of procurement from only MSEs owned by SC/ST entrepreneurs 1.17

5

% age of procurement from MSEs owned by SC/ST entrepreneurs w.r.t. procurement through MSEs

0.23
6 Total value of procurement from only MSEs owned by Women entrepreneurs 30.84

7

% age of procurement from MSEs owned by Women entrepreneurs w.r.t. procurement through MSEs

6.01

Central Government vide its notification F.No. 16/8/2018- P&G policy dated 2.11.2018 has mandated that companies registered under Companies Act 2013 with a turnover of more than Rs.500 Crs and all CPSUs shall be required to get themselves on boarded on TReDS. TReDS (Trade Receivables Discounting System) is an institutional mechanism set up in order to facilitate the discounting of invoices for MSMEs from Corporate Buyers through multiple financers. RailTel is registered on TReDS platform wef 18.03.19 through Mynd Solution Private Limited or M1 Xchange.

19. Right to Information Act, 2005

Your Company has a well-defined mechanism place to deal with the RTI applications under the

Right to Information Act, 2005 ("RTI Act"). RCIL being a responsible Public Sector Undertaking has complied with the provisions of the RTI Act and has designated CPIO/CAPIO, Appellate Authority & Transparency Officer and also a Nodal to oversee its implementation as required under the provisions of the RTI Act. The RTI Act seeks to provide for setting out the practical regime of

Right to Information for citizens to secure access to information under the control of Public Authorities in order to promote transparency and accountability in the working of every Public Authority. The details of RTI dealt during the year is shown in Table-3.

Table-3

Particulars

Nos.
No. of RTI cases pending as on 01/04/2022 03
Received during the Year 242
Disposed off during the year 236
Pending as on 31/03/2023 7

20. Business Responsibility and Sustainability Report

In compliance with the requirement of Clause (f) of sub-regulation (2) of Regulation 34 of Listing

Regulations, the Business Responsibility and

Sustainability Report ("BRSR") is presented in the separate section which is forming part of this Annual Report.

21. Particulars of Loans, Guarantees or Investments

During the year, RCIL has not given any loan or guarantees covered under the provisions of

Section 186 of the Companies Act, 2013 read with

Companies (Meetings of Board and its Powers)

Rules, 2014.

The detail of investments made by the Company is given in the notes to the Financial Statements.

22. Internal Controls Systems and their Adequacy

The Company has an internal control system in commensuration with size, scale and complexity of its operations.

During the year, the Company has engaged Internal

Auditors to carry out Internal Audit of the Company. The highlights of internal audit report and their synopsis were placed before the Audit Committee for its review.

RCIL has implemented ORACLE ERP solution with name "Project Parivartan" and all modules like

Projects, Procurement, Operations, Maintenance, Finance, HR, Sales and Marketing are live from December 2013. Implementation of "Project

Parivartan" has empowered all employees to focus on their core competencies, making work environment stress free, at the same time ensuring transparency and decision making in the system. During the year 2022-23, RCILs IT team continuously worked towards strengthen of core processes of these implemented modules so that users could effectively and efficiently use day-to-day work. New ERP Modules like Financial Budgeting, Payables Provision Invoicing, Integration between Learning Management System with ERP, Integration between HPSM with ERP, PAC/FAC Application and Revenue/Outstanding as per Credit

Policy Application have been developed apart from regular O&M and enhancements works including development of new reports.

Further, as per management and business requirement, during the FY 2023-24, ERP team shall be working for development of new applications like Vendor Bill tracking Application, Dashboard Mobile App for higher management, Project Management Application, Document Management System, Appraisal Management System, Enhancement in supplier BG and EMD modules, ERP version upgrade, Attendance Management System, PCDO Application, Bank Integration for Receivables. Furthermore, in the next financial year RCILs IT team shall be working towards strengthening of existing

ERP modules and development of other additional requirements.

23. Annual Return

The Annual Return of RCIL pursuant to Section

134(3)(a) read with Section 92(3) of the Companies

Act, 2013 and Regulation 34 of Listing Regulations, for the financial year ended on March 31, 2023 placed at https://www.railtelindia.com/annual-return.html

24. Managements Discussion and Analysis Report

In compliance with the requirement of Regulation

34(2)(e) of Listing Regulations, the Managements Discussion and Analysis Report for the year under review is presented in separate section which is forming part of this Annual Report.

25. Human Resource Development

Thefor Human Resource Development ("HRD") function in the organization has been designed to maximize employee performance. HRD is primarily concerned with the management of people within organization and focusing on policies and systems. RCIL firmly believes in the strength of its most asset i.e., Human Resource. RCIL cares and values for its human resource which is the bedrock of success story. To keep the employees morale high, your Company extends several welfare benefits to them and their families by way of implementing various new and revised welfare policies for its employees. As on 31st March, 2023, the Company had total manpower strength of 765 employees including regular, deputationist, contractual and consultants.

The details are shown in Table-4. During the year, Company has also availed the services of 1883 outsourced employees.

Table-4

Category

No. of Employees for the year ended 31.03.2023 No. of Employees for the year ended 31.03. 2022
Regular 474 443
Employees
Deputationist 45 57
On Contract 206 162
(Direct)
On Contract 27 16
(re-employed)
Consultants 13 20

The percentage of women employees, SC/ST/ OBC employees, persons with disabilities and ex-servicemen out of regular employees of the

Company is Shown in Table-5:-

Table-5

Category

No. of Employees for the Year ended 31.03.2022 No. of Employees for the Year ended 31.03.2023 % of total no. of regular employees during financial year ended 31.03.2023 No. of recruitment made in these categories*
Women Employees 47 49 10.34 2
SC Personnel 61 72 15.19 11
ST Personnel 17 22 4.64 6
Other Backward Classes 118 132 27.85 15
Person with Disabilities 7 7 1.48 3
Ex-Serviceman 0 0 0 0

* Employees who join on absorption basis are regular employees but not part of recruitment data.

The Company has been following the Govt. Guidelines regarding reservation for SCs, STs, OBCs, Persons with disabilities and ex-servicemen.

26. Particulars of Employees

Your Company being a Government Company, the provisions of Section 197(12) of the Companies Act, 2013 and relevant rules issued thereunder, are not applicable as per notification dated June 05, 2015 issued by MCA.

The terms and conditions of the appointment of

Functional Directors are subject to the applicable guidelines issued by the DPE, Government of India.

27. Rajbhasha (Official Language)

For implementation of the Official Language Policies of the Government of India, an Official Language Cell is set up in RailTel Corporate Office with Mukhya Rajbhasha Adhikari, a nominated Rajbhasha Adhikari and a Senior Manager/Rajbhasha . Each Regional Office of RailTel has one Nominated Rajbhasha Adhikari. In RailTel, the Official Language

Implementation Committee meeting is held every quarter under the chairmanship of Chairman and

Managing Director. Official language progress reports are regularly sent to Railway Board. Official language Progress reports are also regularly sent to Town Official Language Implementation Committee (NARAKAS). The meetings of the Official Language Implementation Committee organized by the Railway Board and the meeting of the Town Official Language Implementation Committee (NARAKAS) are regularly attended by the officials of RailTel. RailTels Chandigarh, Chennai, Jaipur territory offices and Regional offices of Southern and Region headquartered at Secunderabad and Kolkata respectively had been inspected by the Second

Sub-Committee of the Parliamentary Committee on Official Language on 29.04.2022, 18.05.2022, 28.02.2023 18.06.2022, 16.11.2022 respectively to review the use of Hindi.

The second sub-committee of the Honble Parliamentary Committee on Official Language entrusted the work of coordination of the inspection of Secunderabad and Kolkata areas to RailTel Regional Offices at Secunderabad and Kolkata . co-ordination work was done excellently by the RailTel officials at both the places. Appreciation

Mr. Zakir Hussain Siddiqui, Executive Director/ Eastern Region, Ms. Ruchira Chatterjee, General Manager/Administration, Security & Marketing and Mukhya Rajbhasha Adhikari, Ms. Pratibha Devendra Yadav, General Manager/Chennai and Mr.Vijay Kumar Saxena, Senior Manager/Rajbhasha, for superb co-ordination and co-operation with the

Parliamentary Committee.

On the occasion of Hindi Diwas, Hindi Pakhwada was celebrated in RCIL from 16 to 30 September, 2022 and various activities/programs were organized during the pakhwada.

Rajbhasha Pakhwada 2022 was inaugurated by the Chairman and Managing Director on 16.09.2022. A Hindi Pakhwada banner was put up at the main entrance of RCIL Corporate. During the Hindi Pakhwada Hindi essay competition, Hindi noting and drafting competition, Hindi debate competition, Hindi quiz competitions were organized. The officers and employees of office participated in the said competitions.

On the occasion of the closing ceremony of Hindi

Pakhwada 2022, the Chairman and Managing Director gave cash prizes and certificates to officers and employees who secured first, second third place in different competitions. Consolation prizes were also given. Besides, award was also given to employees who had done Commendable work in Hindi during the year.During the closing ceremony, the regional offices and territory were present through webex.

RailTel, Corporate Office has introduced

Rajbhasha Shield

For the Ist time RailTel, Corporate Office

RailTel Rajbhasha Shield for doing excellent and commendable work in Hindi during the year. First

RailTel Rajbhasha Shield was presented to RailTel Eastern Region, Kolkata for the year 2022.

As per the instructions of the Department of Official Language, Ministry of Home Affairs, and workshops are organized every quarter in the office in which eminent scholars from Hindi are invited for lectures. One such workshop Shri Balendu Sharma" Dadhich" Director/Microsoft was invited.

A quarterly newsletter "RailTel Gatividhian" is being published regularly by RCIL for the use of the Official Language, the first edition of which published from October to December, 2018 and is being published regularly thereafter. Seventeen editions have been published so far. Apart from this, RailTel also publishes the official magazine "RailTel Pragati" on a half yearly basis.

Seven editions have been published so far and the

Eight issue of the Magazine is under publication.

RailTels official language magazine "RailTel Pragati" had been awarded the first prize under the Best Magazine Award category by the Town Official Language Implementation Committee, Upkram-1 Delhi. It is a first for "RailTel Pragati" and a tremendous achievement as Town Official Language Implementation Committee has 44 PSUs as its members.

28. Prevention, Prohibition and Redressal of Sexual Harassment

In order to provide protection against sexual harassment of women at workplace and for prevention and redressal of complaints of sexual harassment, the Company has in place a system to prohibit & prevent the social evil of Sexual

Harassment at Workplace in accordance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and rules made thereunder.

The objective is to provide women a workplace free from harassment, to ensure that every woman is treated with dignity and respect and to provide a speedy redressal mechanism to women who have been subjected to sexual harassment.

For the said purposes, RCIL has an Internal

Complaints Committee (ICC) in place at its

Corporate Office and all four Regional Office(s) which is responsible to:-

• Investigate every formal written complaint of sexual harassment.

• Meet at regular intervals.

• Prepare an Annual Report containing the details of complaints of sexual harassment pursuant to the provisions of Act and provide the same to employer.

Take appropriate remedial measures to respond to any substantial allegations of sexual harassment.

The composition of Internal Complaints Committee on Sexual Harassment comprised of one independent nominee from YWCA as member of the committee, besides, three other executives from corporate office of the company as member of the committee. The Committee is headed by women Chairperson. The summary of complaints dealt during the year

2022-23 is shown in Table-6: Table-6

Particulars

Nos.
Number of complaints of Sexual Harassment received in the year. 01
Number of complaints disposed off during the 01 year.

Number of cases pending for more than 90 days.

Nil

Number of workshops on awareness programmes against sexual harassment conducted during the year.

02

29. Risk Management

The Board of Directors of your Company at their 78th meeting had earlier adopted a Risk Management Policy (RMP) prepared by M/s Price Waterhouse Coopers (PwC).

The Board of Directors of your Company in their

117th meeting held on 22nd December, 2020 had adopted the revised RMP which is in line which requirement of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Further, the Board of Directors of your Company in their 122nd meeting held on 17th June, 2021 has considered and approved the revision in existing RMP to make it sync with the requirement of amendment in SEBI (LODR) Regulations, 2015. The revised Risk Management Policy is implemented in RCIL.

In order to develop and implement an Enterprise

Risk Management Framework, RCIL has constituted a Board Level Risk Management Committee (Apex Level). The Risk Management Committee has the key role of monitoring the development, implementation and performance of the Enterprise

Risk Management framework and maintains an enterprise-wide view of the top risks. In order to further strengthen Risk Management and implement a suitable process, RCIL has also formed a Functional Risk Management Committee constituted with Chief Risk Officer and heads key functions/departments. The functional heads will facilitate the identification and assessment risks within their departments/functions with the assistance of their teams.

In terms of the approved Risk Management Policy, following key risks have been identified and suitable risk mitigation measures are being adopted from time to time:

1) Project Risk

2) Strategy Risk

3) Market Risk

4) People Risk

5) Technology Risk

6) Reputation Risk

7) Insurable Risk

8) Contractor/Vendor Risk

9) Cyber Security Risk

30. Related Party Transactions

Your Company has formulated a policy on Related Party Transactions which is also available on Companys website at www.railtelindia.com. This policy deals with the review and approval of Related Party Transactions.

Pursuant to section 134(3)(h) of the Companies Act

2013, read with Rule 8(2) of Companies (Accounts) Rules, 2014, particulars of contracts or arrangements with related parties is provided in specified Form no. AOC-2 and is placed at Annexure-I.

31. Corporate Governance

A detailed report on Corporate Governance as stipulated under Regulation 34(3) read with Schedule

V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is appended and forms part of the Annual Report. The Company has always worked towards enhancing the Corporate Governance and the principles underlying the same within the organization. Your Company is in compliance with DPE Guidelines on Corporate Governance to the extent possible. Pursuant to the ofrequirements of DPE Guidelines, 2010 a certificate obtained from Practicing Company Secretary and is forming part of this Annual Report.

In compliance with the directives of DPE, the Company is also regularly sending its quarterly and consolidated annual report in the prescribed manner to its Administrative Ministry/DPE. For each quarter, CPSEs are graded under various heads viz; Composition of Board, Non-Official Directors, Meetings, Code of Conduct, Audit Committee, Remuneration Committee, Board Disclosures, Directors Remuneration etc. on the basis of scores prescribed for each head. For the year under review, RCIL has secured, based on self-evaluation, an annual score of "94.84%" which falls under "Excellent" grade for compliance of DPE Guidelines on Corporate Governance for FY 2022-23.

32. Corporate Social Responsibility

As per Section 134(3)(o) read with Section 135 of the Companies Act, 2013 along with the Rules made under Companies (Corporate Social Responsibility Policy) Rules, 2014, your Company has formulated a CSR & Sustainability Policy which provides a broad framework within which the Company will carry out the CSR activities. The policy aims for social and economic development of community in the areas of women empowerment, rural development, education, skill development, health and such other areas and adhere to sustainable and transparent business practices. The activities to be undertaken under the policy will be in accordance with Schedule-VII of the Act and directives issued by DPE from time to time.

During the FY 2022-23, RCIL has undertaken to spend 700.91 lakh on CSR activities ( 436.87 Lakh for FY 2022-23, which is 2% of average net profit before tax (PBT) of the company earned during the immediately preceding three Financial Years) plus

264.04 Lakh as unspent from previous years. Out of CSR budget, 446.84 Lakh was spent during FY 2022-23 on CSR activities.

During the year, RCIL has carried out various CSR activities like Promoting Education, establishing Health Center in Purulia, West Bengal, Congenital Heart Disease Treatment for poor at Gurugram, Haryana, Support to cancer patients at Delhi, Donation of fully equipped cardiac ambulance at Hospital in Delhi, Donation of books for school at Delhi, Jal-Sanchay project in Karauli, Rajasthan and Digital classrooms in Haridwar, Uttarakhand etc. One of the RCILs CSR initiative namely ‘RailTels Akansha Super-30, Dehradun, Uttarakhand is related to providing free lodging and mentorship to poor but talented students from state of Uttarakhand, for admission to IITs and other premier engineering institutes. The program has success rate of 96% with students getting admission to IIT-JEE and other premier engineering institutes. The Annual Report on CSR as prescribed under Companies (Corporate

Social Responsibility Policy) Rules, 2014 is forming part of this Report and is placed at Annexure -II.

33. Secretarial Standards

During the year, the Company is in compliance with the applicable Secretarial Standard issued by the Institute of Company Secretaries of India (ICSI) to the extent applicable.

34. Vigil Mechanism

Vigilance Administration is an integral part of any organization. If the vigilance set up is effective in an organization, it will certainly ensure the functioning of the other segments in an efficient way.

Vigilance Administration consists of preventive and punitive anti-corruption measures. The measures include detecting irregularities, analyzing, and finding out reasons for such irregularities and making effective systemic improvements to curb them. It also includes identifying public servants accountable for misconduct and taking appropriate punitive actions.

During the year, the Vigilance Department carried out various preventive activities including periodic and surprise inspections which led to various system improvements. This shall enable RCIL to proactively ensure transparency in various spheres of Companys activities as well as also take punitive measures wherever required. The Status of Vigilance activities during the year is shown in Table-7:

Table-7

S.No.

Particulars

Nos.

Remarks

1

Number of Complaints received during the year

48

All complaints dealt as per complaint handling policy in a timely manner.

2

Number of investigation reports carried out during the year (incl. under directions of CVC & Railway Board)

10

Related to tender/contract management and procedure violations.

3 Number of Officers against whom disciplinary proceeding initiated arising out of investigations (incl. CBI cases)
a) Major departmental action 0
b) Minor departmental action 0
4

Number of Inspections conducted during the year

55 Across Corporate Office, Regional
a) Periodic inspection
b) Surprise inspection 20 & field units.
c) CTE Type inspection 09

5

Number of System Improvements taken up during the year

72

In respect to HR/Admin policies & procurement matters.

(i) Inspections by Vigilance Department

CVO visited Bhubaneshwar (BBS) Territory from 03.12.2022 to 05.12.2022 during which inspection was done for Wi-fi, PoP and VSS Central Monitoring System at Bhubaneswar. He also inspected Bhadrak

Railway station where 36 VSS camera has been installed by RailTel.

CVO also inspected Cuttack and Khurda Railway Stations from 16.01.2023 to 17.01.2023 during which inspection was done for Wi-fi, PoP in both the stations along with VSS at Khurda.

CVO along with Vigilance team inspected Northern

Region Network Operation Center (NOC) on 19.01.2023 where SDH & MPLS NOC, DG Sets and

Thomson Road Equipment Room were inspected. Vigilance Team also inspected Northern Region

Store at Thomson Road, New Delhi on 15.03.2023.

As a part of periodic inspection, Vigilance team inspected Data Center Gurgaon on 18.03.2023 where working of DG sets and Data Center Equipment Room were checked.

Vigilance team made a surprise inspection of

Andheri PoP, Churchgate PoP, Mumbai Central PoP, Equipment Room at Mahalaxmi and Western Region store at Mahalaxmi on 20.03.2023 and 21.03.2023.

(ii) Other important work done in Vigilance department

IT Initiatives: Online Complaint Portal is already linked to website for complaints handling. Vigilance profiles for all E-5 and above level Executives updated on SOLVE (System for Online Vigilance Enquiry) portal of DoPT.

Online Vigilance database of all Executives are updated in ERP. After receiving request from

HR Department, 100% vigilance clearance is processed by Vigilance Department on ERP.

Trainings: 14 internal trainings conducted on procurement, contract and preventive vigilance matters covering all employees.

(iii) Vigilance Awareness Week

As per Central Vigilance Commissions directives, Vigilance Awareness Week was observed in RCIL from 31st October to 6th November, 2022 in its true spirit and sense with the theme "Corruption free India for a developed Nation";

During the week, a number of vigilance awareness activities were carried out and events organized involving RCILs Officials as well as for

Citizens. The week began with integrity pledge to RCIL officials on 31.10.2022. A brief of such activities is as under:

1) During the Vigilance Awareness Week on 31.10.2022, CMD and CVO launched a compendium on systemic improvements which covers all systemic improvements issued since 1st January, 2020 through 40 notes/letters identifying 113 systemic improvements in different areas of operation of RailTel.

2) A Nukkad Natak on VAW theme "Corruption free India for a developed Nation"; "was organized

by employees at foyer of Corporate Office awareness purpose on 31.10.2022.

3) Presentations/Lectures on OSINT- An introduction to the Collection of Digital Intelligence by Dr. Deepak Raj Rao, Asstt. Professor, NFSU Rohini New Delhi and Detection of Forgery and Decipherment of Alteration in Documents by Shri Sanjeev Kumar, Associate Documentation Officer, NFSU Rohini Branch were organized on 01.11.2022.

4) Anish Prasad, IPS, Director Vigilance (Police), Railway Board delivered a talk on Vigilance matters on 02.11.2022.

5) A Quiz competition was held among all employees of Corporate Office on 03.11.2022.

6) On 04.11.2022, CMD/RailTel and CVO/RailTel felicitated Sh. Alok V Agnihotri, Addl. GM for Preventive Vigilance during his tenure in

Vigilance Department (till 30.06.2022), who was instrumental in bringing many systemic improvements in the working of organization.

7) During the observance of VAW-2022, various competitions were held on the theme of "Corruption free India for a developed

Nation"; "where employees and their family members participated. The winners for Speech/Debate, Article/Essay, Poem, Quiz, Nukkad Natak &

Posters competition were also felicitated with certificate of appreciation on 04.11.2022.

8) During the closing ceremony of Vigilance Awareness Week, RailTel Vigilance Department released Thirteenth edition of Vigilance Bulletin on the occasion.

9) Public grievance redressal camps: Organized Public grievance redressal camps for customers/ Citizens for RailWire with help of RailWire

Partners.

10) Vendors Meet: Organized Vendor meets at Regional Offices and Corporate Office Vigilance Awareness Week 2022.

11) Interaction session with kids: Interaction session with kids of employees those participated in competitions was organized with CVO and CMD.

35. Statutory Disclosures

Your Directors have made necessary disclosures, as required under various enactments including the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

36. Auditors

36.1 Statutory Auditors

The C&AG has appointed M/s. S.R. Goyal & Co. of New Delhi as Central Statutory Auditors of the

Company to audit the Financial Statements for the year ended on 31st March, 2023.

Besides that, the C&AG has also appointed the following firms of Chartered Accountants as Branch Auditors for audit of the Regional Office(s) of

Company:

Auditor

Region
M/s. S.R. Goyal & Co. Northern Region & Corporate Office
M/s. Laxminiwas & Co. Southern Region
M/s. J L Sengupta & CO. Eastern Region
M/s. Banshi Jain & Western Region
Associates

In terms of the authorization given by the members in their last Annual General Meeting, the Board on the recommendation of Audit Committee has already considered and approved the payment of fee for all the above Auditors to the aggregate extent of 39 Lakh excluding GST.

36.2 Cost Auditors

The Company has appointed M/s. Dhananjay V. Joshi, Cost Accountants as Cost Auditors to audit the cost record maintained by the Company for the

Financial Year 2022-23.

The Company has filedForm CRA-2 with the MCA in this regard.

36.3 Secretarial Auditor

During the year, pursuant to provisions of Section 204 of the Companies Act, 2013 read with rules made thereunder, RCIL has appointed M/s. T.

Chatterjee & Associates, Practicing Company Secretaries, as Secretarial Auditor of the Company for the Financial Year 2022-23. The Secretarial Audit has been conducted by M/s. T. Chatterjee & Associates, Practicing Company Secretaries and issued a Secretarial Audit Report in the format prescribed under Companies (Appointment and

Remuneration of Managerial Personnel) Rules, 2014.

The Secretarial Audit report of the Company for the year ended 31st March, 2023 in Form no. MR-3 and the Managements reply on the observation/ comments of Secretarial auditor shall forms part of this report and are placed at Annexure- III and Annexure-IV, respectively.

37. Comments of C&AG

The comment(s) of C&AG are attached and forming part of this Annual Report.

38. Auditors Report

The Auditors Report of the Company for the year ended 31st March, 2023, is attached with the

Financial Statement of the Company. There is no qualification in the Auditors Report on the Financial Statements of the company. During FY 2022-23, no fraud has been reported by the Auditors of the Company.

39. Energy Conservation, Technology Adoption, Foreign Exchange Earnings and Outgo

The Company is presently engaged in providing telecom services. The disclosure on Conservation of Energy and Technology Absorption as required under the provisions of Section 134(3)(m) of the

Companies Act, 2013 and as prescribed under Rule 8 of Companies (Accounts) Rules, 2014 is forming part of this Report and is placed at Annexure- V.

40. MOU with Administrative Ministry

RCIL is signing a MoU with the Government of India,

MoR whereby laying inter alia the physical and financial targets. The MOU pertaining to FY 2022-has been signed with MoR within stipulated time.

For the year 2021-22, RCIL has got "Very Good" rating from DPE. For the MoU targets 2022-23, RCIL has complied to various guidelines communicated by DPE as below: a) DPE guidelines issued from time to time on CSR expenditure. b) Steps and initiative taken for Health & Safety improvement of Human Resources in CPSEs as prescribed by the Administrative Ministry. c) Procurement of goods or services through

MSEs with 54% percent of total procurement of goods and services against target of 25%. d) Procurement of goods or services through

Women MSEs with 6 percent of total procurement of goods and services against target of 3%. e) Expenditure management economy measures and rationalization of expenditure. f) Guidelines on accessible India campaign (Sugamya Bharat Abhiyan) g) Guidelines on implementation of apprenticeship

Act, 1961

The company has also complied with the applicable provisions of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015, the compliance of which are within the control of the company.

41. Event occurring after the Balance Sheet Date

As such, no significant events occurred between the end of the financial year to which this Financial

Statements relates and date of this report.

42. General Disclosure

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

(a) Details relating to deposits covered under Chapter V of the Companies Act, 2013.

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

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

(d) Neither the Chairperson and Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from subsidiary company.

(e) 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. (f) Application made or proceeding pending under the Insolvency and Bankruptcy Code, 2016.

(g) One time settlement of loan obtained from the

Banks or financial institutions.

43. Transfer of Unclaimed Dividend to Investor Education and Protection Fund

During the year under review, no amount was required to be transferred to the Investor Education and Protection Fund by the Company.

44. Directors Responsibility Statement

In terms of the provisions of section 134(3)(c) read with section 134(5) of the Companies Act, 2013, as amended, your Directors confirm that:

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

(b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;

(c) the directors had taken proper and sufficient for the maintenance of adequate accounting records in accordance with the provisions of

Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

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

(e) that internal financial controls are adequate and operating effectively; and

(f) 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.

45. Acknowledgements

Your Directors would like to place on record their sincere appreciation and gratitude to the Indian

Railways, Government of India, Department of Investment and Public Asset Management (DIPAM),

Ministry of Communications and IT and other

Ministries/Departments, subscribers of Companys telecom services, the stakeholders, and bankers and to all the State Governments, Local Bodies and Regulatory authorities for their continued cooperation and invaluable support.

Your Directors thank all shareholders, business partners and all members of the RCIL Family for their faith, trust and confidence reposed in the Board. Your Directors express their deep appreciation for the hard work and dedicated efforts put in by employees at all levels and look forward to their continued contribution in achieving the mission and objective of the Company.

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