Sri Adhikari Brothers Television Network Ltd Directors Report.

To

The Members,

Sri Adhikari Brothers Television Network Limited

The Board of Directors of your Company hereby presents the 24 Annual Report on the Business and operations of your Company along with the Audited Standalone and Consolidated Financial Statements of the Company for the Financial Year ended March 31, 2019.

Financial Highlights:

(Rs. in Lakh)

Particulars Standalone Consolidated
For the year ended March 31, 2019 For the year ended March 31, 2018 For the year ended March 31, 2019 For the year ended March 31, 2018
1 Revenue from operations 1,524.47 5,748.63 1,524.47 5,748.63
2 Other income 120.30 26.85 120.30 26.86
3 Profit / (Loss) before Depreciation & Expenses, Exceptional items, Finance Cost and Tax (740.06) (470.36) (740.05) (470.47)
4 Less : Depreciation and Amortization 2,398.07 2,333.29 2,398.06 2,333.29
5 Less: Finance charge 1,224.45 1,596.63 1,224.57 1,596.63
6 Profit / (Loss) after depreciation / finance cost before exceptional items and Tax (4,362.57) (4,400.29) (4,362.69) (4,400.40)
7 Less: Exceptional items 888.01 - 888.01 -
8 Profit / (Loss) before tax expense (5,250.58) (4,400.29) (5,250.70) (4,400.40)
9 Less: Provision for Tax - 0.25 - 0.25
10 Profit / (Loss) after Tax (5,250.58) (4,400.54) (5,250.70) (4,400.65)
11 Less : share of minority interest - - (0.04) (0.04)
12 Add: profit/ (Loss) of associates - - - (874.07)
13 Other Comprehensive Income (13.62) 11.63 (13.62) 11.63
14 Total Comprehensive Income for the period (5,264.20) (4,388.91) (5,264.28) (5,263.06)
15 Earnings per Share (Basic and Diluted) (15.03) (12.59) (15.03) (15.09)

The financial statements of the Company for the financial year ended March 31, 2019 have been prepared in accordance with the Indian Accounting Standards (IND AS) prescribed under Section 133 of the Companies Act, 2013 read with relevant rules issued thereunder and other accounting principles generally accepted in India.

The comments of the Board of Directors ("the Board") on the financial performance and the state of affairs of the Company have been provided under the Management Discussion and Analysis which forms part of this Annual Report.

The previous year figures have been re-grouped/ re-arranged/ re-classified/ reworked wherever necessary to confirm with the current year accounting treatment.

REVIEW OF OPERATIONS:

During the financial year under review, performance of the Company got impacted due to various reasons and Company has witnessed reduction/drop in operations of the Company. As such, the Company earned total revenue of Rs. 1,644.77 Lakh as against Rs. 5,775.48 Lakh in the previous year. The Loss before tax is Rs. 5,250.58 Lakh as against Loss before tax Rs. 4,400.29 Lakh in the previous year. The Loss after tax is Rs. 5,250.58 Lakh as against Loss after tax Rs. 4,400.54 Lakh in the previous year.

The total comprehensive income is (Rs. 5,264.20) Lakh as against (Rs. 4,388.91) Lakh in the previous year.

Due to decrease in revenue, the Company could not make timely repayment of loans to banks and hence the banks have classified the Companys account as “Non-Performing Assets (NPA)”. The Company has submitted resolution plan to the bank which is under consideration.

The Board of Directors are taking all the steps to revive the performance of the Company and is focusing to generate cash flows in the Company.

STATE OF THE COMPANY AFFAIRS:

The Company operates in Single segment i.e. Content Production and Distribution.

SHARE CAPITAL:

There was no change in Share Capital of the Company during the financial year 2018-19.

TRANSFER TO RESERVES:

During the financial year under review, no amount has been transferred to Reserves & Surplus.

DIVIDEND:

Due to loss during the financial year under review, your Directors do not recommend any dividend for the financial year 2018-19.

INVESTOR EDUCATION AND PROTECTION FUND:

In terms of the provisions of Section 125 of Companies Act, 2013 read with Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the dividend amount along with the shares for F.Y. 2010-11 remaining unclaimed/unpaid for a period of seven consecutive years was due to be transferred to Investor Education and Protection Fund (IEPF) in the financial year 2018-19. As such the unclaimed/unpaid dividend amount of Rs. 75,556/- for F.Y.2010-11 were transferred to IEPF authority and 5,488 Shares for F.Y. 2010-11 were also transferred to the IEPF Authority.

Further, the unpaid/unclaimed dividend amount lying with the Company for the F.Y. 2011-12 and corresponding shares for the said F.Y. 2011-12 are due to transfer to the IEPF Authority on November 4, 2019.

CHANGE IN THE NATURE OF BUSINESS:

There was no change in the nature of business during the financial year under review.

PUBLIC DEPOSITS:

During the financial year under review, the Company has not accepted any deposits within the meaning of Section 73 and 76 of the Companies Act, 2013, read with the Companies (Acceptance of Deposits) Rules, 2014.

DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP):

Retirement by rotation

In accordance with the provisions of Section 152 of the Companies Act, 2013 read with the Rules made thereunder and the Articles of Association of the Company, Mrs. Latasha Jadhav (DIN: 08141498), Director of the Company, retires by rotation at the ensuing Annual General Meeting (AGM) and being eligible, offered herself for re-appointment. The Nomination & Remuneration Committee and the Board recommends the re-appointment of Mrs. Latasha Jadhav as Director of the Company.

As stipulated under the Regulation 26(4) and 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations) and Secretarial Standard on General Meetings (SS-2) issued by the Institute of Company Secretaries of India (ICSI), the brief resume of the Directors proposed to be appointed / re-appointed is given in the Notice forming part of this Annual Report.

Appointment

At the 23 AGM held on September 25, 2018, the members of the Company appointed following Directors as Independent Directors of the Company:-

1. Dr. Ganesh P Raut (DIN: 08047742);

2. Mr. Umakanth Bhyravajoshyulu (DIN: 08047765) and

3. Mr. M Soundara Pandian (DIN: 07566951)

for a period of 5 (Five) consecutive years w.e.f. January 17, 2018 to January 16, 2023, and who shall not be liable to retire by rotation.

The members appointed Mrs. Latasha Jadhav (DIN: 08141498) as Non-Executive Director of the Company and re-appointed Mr. Markand Adhikari (DIN: 00032016) as Vice Chairman and Managing Director of the Company for further period of 3 years w.e.f. August 18, 2018, who shall be liable to retire by rotation. Further, re-designated Mr. Markand Adhikari (DIN: 00032016) from Vice-Chairman & Managing Director to Chairman & Managing Director of the Company w.e.f. September 07, 2018, without change in the terms and conditions of his appointment as approved at the 23 AGM of the Company. During the financial year under review and upto the period of signing of this report, the Board of Directors:

a. Appointed Ms. Navita Khunteta as the Company Secretary & Compliance Officer of the Company w.e.f. April 23, 2019.

b. Appointed Ms. Komal Jhamnani, Company Secretary & Compliance Officer of the Company w.e.f. August 14, 2019.

c. Appointed Mrs. Latasha Jadhav, Director of the Company as the Chief Financial Officer of the Company w.e.f. April 23, 2019.

Resignation

1. Mrs. Shilpa Jain, Company Secretary & Compliance Officer of the Company resigned w.e.f. November 28, 2018.

2. Ms. Navita Khunteta who was appointed as Company Secretary & Compliance Officer of the Company w.e.f. April 23, 2019 resigned w.e.f. August 14, 2019.

The Board expressed its appreciation for the contribution made by Ms. Shilpa Jain and Ms. Navita Khunteta during their tenure as the KMP of the Company.

Declaration from Independent Directors

The Company has received declaration from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Listing Regulations.

Remuneration to Non-Executive Directors

During the financial year under review, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, commission and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board/Committee of the Company.

Key Managerial Personnel (KMP)

Pursuant to the provisions of Section 203 of the Companies Act, 2013, the details of Key Managerial Personnel (KMP) of the Company during the financial year under review is stated herewith:

Sr. No. Name of the KMP Designation
1. Mr. Markand Adhikari Chairman & Managing Director
2. Ms. Shilpa Jain Company Secretary (resigned w.e.f. November 28, 2018)

ANNUAL EVALUATION OF PERFORMANCE BY THE BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS:

Pursuant to the provisions of the Companies Act, 2013, a formal annual evaluation needs to be made by the Board of its own performance and that of its Committees and individual directors. Schedule IV to the Act, states that the performance evaluation of the independent directors shall be done by the entire Board of Directors, excluding the director being evaluated. The Board works with the Nomination and Remuneration Committee to lay down the evaluation criteria.

The Board has carried out evaluation of its own performance, the directors individually as well as the working of its Audit Committee, Nomination & Remuneration Committee and Stakeholders Relationship Committee of the Company. The Board has devised questionnaire to evaluate the performances of each of Executive, Non-Executive and Independent Directors. Such questions are prepared considering the business of the Company and the expectations that the Board have from each of the Directors. The evaluation framework for assessing the performance of Directors comprises of the following key areas:

i. Attendance of Board Meetings and Board Committee Meetings;

ii. Quality of contribution to Board deliberations;

iii. Strategic perspectives or inputs regarding future growth of Company and its performance;

iv. Providing perspectives and feedback going beyond information provided by the management.

v. Ability to contribute to and monitor our corporate governance practices

During the financial year under review, the Nomination and Remuneration Committee reviewed the performance of all the executive and non-executive directors.

A separate meeting of the Independent Directors was held for evaluation of performance of non-independent Directors, performance of the Board as a whole and performance of the Chairman.

MEETINGS OF THE BOARD:

The Board meets at regular intervals to discuss and decide on the Companys business policies and strategies apart from other Board businesses. A tentative annual calendar of the Board and Committee Meetings is informed to the respective Directors to facilitate them to plan their schedule and to ensure their meaningful participation in the meetings.

The notice of meeting of the Board of Directors and Committees were given to all the Directors of the Company. Usually, meetings of the Board are held in Mumbai, Maharashtra. The agenda of the Board/Committee meetings is circulated 7 days prior to the date of the meeting as per Secretarial Standards on Meeting of Board of Directors (SS-1) issued by ICSI. The agenda for the Board and Committee meetings includes detailed notes on the items to be discussed at the meeting to enable the Directors to take an informed decision.

During the financial year under review, the Board of Directors met 7 (Seven) times, the details of which are given in the Report on Corporate Governance forming part of this Annual Report. The intervening gap between two consecutive meetings was within the period prescribed under (SS-1) issued by ICSI and the Companies Act, 2013.

COMMITTEES OF THE BOARD:

In compliance with the requirements of the Companies Act, 2013 and the Listing Regulations, the Company has constituted 3 (Three) Committees of the Board which is stated below:

1. Audit Committee;

2. Nomination and Remuneration Committee;

3. Stakeholders Relationship Committee.

Details of the Committees constitution with respect to their terms of reference, meetings and attendance at the meetings held during the financial year, are provided in the Report on Corporate Governance, forming part of this Annual Report.

AUDIT COMMITTEE AND ITS COMPOSITION:

The Audit Committee is duly constituted as per the provisions of Section 177 of the Companies Act, 2013 and Regulation 18 of the Listing Regulations. The composition, terms of reference, role of the Audit Committee is provided in the Report on Corporate Governance forming part of this Annual Report.

All the recommendations made by the Audit Committee were accepted and approved by the Board.

The Audit Committee of the Company reviews the reports, to be submitted to the Board of Directors with respect to auditing and accounting matters and on the matters for which it has been authorized by the Board as per the terms prescribed under Listing Regulations. It also supervises the Companys internal control and financial reporting process.

POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION AND OTHER DETAILS:

Pursuant to provisions of Section 178 of the Companies Act, 2013 read with the Rules made thereunder, Regulation 19 of the Listing Regulations and on the recommendation of the Nomination and Remuneration Committee, the Board has adopted a Policy on “Criteria for appointment of Directors, Key Managerial Personnel, Senior Management Employees and their Remuneration.” The salient features of the Remuneration Policy are stated in the Report on Corporate Governance which forms part of this Annual Report.

RISK AND AREAS OF CONCERN:

The Company has devised and adopted a Risk Management Policy and has implemented a mechanism for risk assessment and management. The policy is devised to identify the possible risks associated with the business of the Company, assessment of the same at regular intervals and taking appropriate measures and controls to manage, mitigate and handle them. The key categories of risks covered in the policy are Strategic Risks, Financial Risks, Operational Risks and such other risks that may potentially affect the working or performance of the Company.

The Board and the Audit Committee periodically reviews the risks associated with the Company and recommends steps to be undertaken to control and mitigate the same through a properly defined framework.

WHISTLE BLOWER POLICY / VIGIL MECHANISM:

The Company has adopted a Whistle Blower Policy/Vigil Mechanism as per the provisions of Section 177 of the Companies Act, 2013 and Regulation 22 of the Listing Regulations. The Policy provides a mechanism for reporting of unethical behavior and frauds made to the management. The mechanism provides for adequate safeguards against victimization of employees who avails the mechanism and also provides for direct access to the Chairman of the Audit Committee, under exceptional cases. The details of the Whistle Blower Policy/Vigil Mechanism are explained in the Report on Corporate Governance and are also available on the website of the Company at http://adhikaribrothers.com/pdf/Vigil%20Mechanism%20or%20Whistle%20Blower%20Policy_SABTNL.PDF

We affirm that during the financial year 2018-19, no employee or director was denied access to the Audit Committee.

EXTRACT OF ANNUAL RETURN:

In accordance with the provisions of Section 92(3) of the Companies Act, 2013 and rules framed thereunder, the extract of the Annual Return in the prescribed Form MGT-9, is appended to this report as “Annexure I”.

Further, pursuant to the provisions of Section 134(3)(a), the extract of annual return of the Company for the year under review shall be made available on the website of the Company viz. http://www.adhikaribrothers.com/.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

During the financial year under review, the particulars of Loans, Guarantees and Investments made by the Company under the provisions of Section 186 of the Companies Act, 2013, are given in the Notes to the Financial Statements forming part of this Annual Report.

PARTICULARS OF THE EMPLOYEES AND REMUNERATION:

Pursuant to the provisions of Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, details of the ratio of remuneration of each Director to the median employees remuneration are appended to this report as “Annexure II Part A”.

During the financial year under review, no employee was in receipt of remuneration exceeding the limits as prescribed under provisions of Section 197 of the Companies Act, 2013 and Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Other information as required under the said provisions is appended to this report as“Annexure II - Part B”.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS:

All contracts or arrangements entered into by the Company with its related parties during the financial year were in accordance with the provisions of the Companies Act, 2013 and the Listing Regulations. All such contracts or arrangements have been approved by the Audit Committee, as applicable.

No material contracts or arrangements with related parties were entered into during the financial year under review. Further, the prescribed details of Related Party Transactions in Form AOC 2, in terms of Section 134 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is given in the “Annexure III” to this report.

In accordance with the provisions of Regulation 23 of the Listing Regulations, the Company has formulated the Related Party Transactions Policy and the same is uploaded on the Companys website at http://adhikaribrothers.com/pdf/Policy-on-Related-Party-Transactions_SABTNL.PDF

SUBSIDIARY, ASSOCIATE, JOINT VENTURE COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS:

As on March 31, 2019, the Company has 1 (One) Subsidiary Company and 1 (One) Associate Company. The details of the above mentioned companies are mentioned in Report on Corporate Governance forming part to this Annual Report.

During the financial year under review, the Board of Directors reviewed the affairs of the subsidiary and associate company. In accordance with the provisions of Section 129(3) of the Companies Act, 2013, the Consolidated Financial Statements of the Company alongwith its subsidiary and associate company forms part of this Annual Report. Further, a statement containing the salient features of the Financial Statements of the subsidiary and associate company in the prescribed format Form AOC-1 is forming part of the Financial Statements. The statement also provides the details of performance, financial positions of the subsidiary and associate company as on March 31, 2019.

In accordance with Section 136 of the Companies Act, 2013, the Audited Financial Statements, including the Audited Consolidated Financial Statements and related information of the Company are available on our website i.e. http://www.adhikaribrothers.com/financials/. These documents will also be made available for inspection at the Registered Office of the Company during business hours on all working days upto the date of the Annual General Meeting.

PERFORMANCE OF SUBSIDIARY AND ASSOCIATE COMPANY:

1. During the financial year under review, no commercial operations were undertaken in Westwind Realtors Private Limited, subsidiary of the Company . The loss before/after tax is Rs. (12,390) as against loss of Rs. (10,875) in the previous year.

2. During the financial year under review, SAB Media Networks Private Limited, an associate of the Company has earned NIL revenue as against Rs. 1,055.25 Lakh in the previous year. The loss before / after tax is Rs. (1,718.81) Lakh as against loss of Rs. (1,864.14) Lakh in the previous year.

STATUTORY AUDITORS AND THEIR REPORT:

Statutory Auditors

M/s P. Parikh & Associates, Chartered Accountants Mumbai (FRN: 107564W) were appointed as the Statutory Auditors of the Company at the 23 AGM held on September 25, 2018, for a term of 4 (four) years, to audit the financial statements of the Company for the financial years from 2018-19 to 2021-22, and who shall hold office from the conclusion of the 23 AGM till the conclusion of the 27 AGM, at a remuneration as may be agreed upon between the Board of Directors and the Statutory Auditors for F.Y. 2018-19 to F.Y. 2021-22.

The Company has received a written consent and an eligibility certificate from M/s P. Parikh & Associates stating that they are willing to act as statutory auditors of the Company and that their appointment satisfies the criteria as provided under section 141 of the Companies Act, 2013.

Statutory Auditors Report

The statutory auditors report for financial year 2018-19 on the financial statements forms part of this Annual report.

Further, following were the managements reply to the qualifications made by the statutory auditors in their report for financial year 2018-19.

1) Details of Audit Qualification: Non Provision of Interest on loan:

Due to defaults in repayment of loan taken from Banks, the account of the company has been classified as non-performing asset by banks and except two banks, other banks have not charged the interest / reversed the unpaid interest charged, from the date the account has been classified as non-performing. No provision has been made in the books of accounts maintained by the Company for interest / penal interest, if any, on these term loans amounting to about Rs. 10,26,49,567/- (exact amount cannot be ascertained), hence to that extent, finance cost, total loss and current financial liabilities is estimated to be understand by about Rs. 10,26,49,567/- (exact amount cannot be ascertained) for the year ended March 31, 2019.

Management reply for point 1:

The Company has submitted its resolution plan to banks, which is under consideration, effect of the same will be given when resolution plans with banks are finalized.

2) Details of Audit Qualification: Non Provision for Impairment in the value of intangible business and commercial rights

The aggregate carrying value of business and commercial rights in the books of the Company as on March 31, 2019 is Rs. 130,10,99,857/-. The revenue generation from monetization of these assets is significantly lower than the expected revenue during the year ended March 31, 2019 and due to which the Company has incurred substantial losses during the year ended March 31, 2019. Hence, there is an indication of impairment in the value of these business and commercial rights. However, in absence of exact amount of diminution in the value of these business and commercial rights, we are unable to quantify the amount of impairment of these business and commercial rights and its consequential effects on the financial statements as on March 31, 2019.

3) Details of Audit Qualification: Impairment in the value of intangible business and commercial rights of the Associate Company:

There is no revenue generation from intangible assets in the books of SAB Media Networks Private Limited having carrying value of Rs. 11,334.83 lakh during the financial year and also the revenue from these intangible assets were significantly lower than the projected revenue in the immediately preceding financial year and company has incurred significant losses during the last two financial years. This indicates impairment in the value of intangible assets. Considering the performance of the Company during the last two financial years, in their opinion full value of the above intangible assets has been impaired. However, no provision has been made for impairment in the value of intangible assets.

Management reply for point 2 and 3:

Management of the company does not anticipate any impairment in the value of Intangible Business and Commercial Rights and related media assets as management consider that Rights/assets can be commercially exploited in different ways to generate the revenue. Management is in continuous process of generating revenue from exploitation of rights in different ways. Management estimates that decline in revenue in recent past is temporary in nature which have potential to get regularized in near future. Management further estimates that the said assets, during their useful life, will be able to generate discounted cash flow at least equal to the present value of rights/assets in the books. The nature of assets is such that revenue generated from it is unevenly spread during the useful life of assets. The company is in process of forming a technical team of experienced persons to estimate the value in use.

4) Details of Audit Qualification: Non Provision of Interest on loan by the Associate Company:

Due to defaults in repayment of dues in the books of SAB Media Networks Private Limited, companys accounts has been classified as non-performing by the bank and bank has taken the possession of the collateral securities belonging to promoters and has invoked the shares pledge as collaterals provided by the third party and recovered the part of interest amounting to Rs. 226.76 lakhs from sale of invoked shares. The Company has not provided the balance interest amounting to Rs. 1397.09 lakhs charged by the bank and to that extent, finance cost, total loss and current financial liability is understated.

Management reply for point 4:

During the year under review, various market conditions and business scenario, the performance of the Company has been impacted as a result the Company has made default in repayment for dues. Accordingly, the accounts of the Company became NPA. Company has further submitted its resolution plan to banks, which under consideration with the bank effect of the same will be given when resolution plans with bank is finalized.

5) During the financial year 2018-2019, the Company has been served a legal notice from one of its secured lenders proposing to initiate proceedings under Insolvency and Bankruptcy Code, 2016 by filing necessary application before the jurisdictional National Company Law Tribunal (NCLT) as per the applicable law and rules.

Management reply for point 5:

The application of the secured lender in National Company Law Tribunal (NCLT) is yet to be admitted and the Company has not received any order from NCLT for the same.

During the financial year under review, the Statutory Auditors had not reported any fraud under Section 143(12) of the Companies Act, 2013, therefore no detail is required to be disclosed under Section 134(3)(ca) of the Companies Act, 2013.

SECRETARIAL AUDIT:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board at its Meeting held on 11 February, 2019, has appointed M/s. Pankaj Nigam & Associates, Company Secretaries, Ghaziabhad, as the Secretarial Auditors to conduct audit of the Company for the financial year 2018-19. The Secretarial Audit Report for the financial year 2018-19 is appended to this report as “Annexure IV”.

During the financial year under review, following are the qualifications of the Secretarial Auditors of the Company alongwith the reply of the Management to the same:

a) The board of directors did not have a woman director for the period 1 April, 2018 to 29 May, 2018 as is required under Section 149 of the Act Management Reply:

The Company had taken diligent and concerted efforts to appoint an appropriate person and subsequently, Mrs. Latasha Jadhav was appointed as the Women Director w.e.f. May 30, 2018 and accordingly, complied with the said requirement.

b) The company does not have a Chief Financial Officer for the period under review as is required Section 203 of the Act;

Management Reply:

The Company had taken diligent and concerted efforts to appoint an appropriate person and subsequently, Mrs. Latasha Jadhav was appointed as the Chief Financial Officer w.e.f. April 23, 2019 and accordingly, complied with the said requirement.

c) The company has not appointed Internal Auditors during the period under review as is required under Section 138 of the Act;

Management Reply:

The Company is in process of appointing an appropriate candidate for the said position.

d) Compliance Officer is not a qualified company secretary for the period from November 29, 2018 to March 31, 2019 as is required under regulation 6 of LODR;

Management Reply:

The Company was in the process of appointing an appropriate candidate and subsequently, Ms. Navita Khunteta was appointed as the Company Secretary and the Compliance Officer of the Company w.e.f. April 23, 2019.

e) The Company has delayed in payment of listing fees to National Stock Exchange of India Limited (NSE) and BSE Limited (BSE);

Management Reply:

The Company has paid listing fees to National Stock Exchange of India Limited (NSE) and BSE Limited (BSE) as on May 18, 2018.

f) Pursuant to our observation at (a) hereinabove the composition of the board of directors was not in accordance with the regulation 17(1) on account of vacancy of woman director till May 29, 2018;

Management Reply:

The Company had taken diligent and concerted efforts to appoint an appropriate person and subsequently, Mrs. Latasha Jadhav was appointed as the Women Director w.e.f. May 30, 2018 and accordingly, complied with the said regulation.

g) The Chief Executive Officer (CEO) & Chief Financial Officer (CFO) certificate to be taken Quarterly & yearly under regulation 33 & 17(8) of LODR respectively is not being signed by CFO as the company did not have an CFO; and

Management Reply:

The Company had taken diligent and concerted efforts to appoint an appropriate person and subsequently, the Company has appointed Mrs. Latasha Jadhav as the Chief Financial Officer w.e.f. April 23, 2019.

h) Non-Disclosure/Delayed Disclosure of the following Events as required under regulation 30(6) of LODR:

i. one of the secured lender had approached NCLT under Insolvency and Bankruptcy Code (IBC) and the said application is pending; however no order has been passed (not disclosed);

ii. Outcome of Board Meeting held on 29th March, 2019 submitted to the BSE Ltd. on 11th April, 2019 (delayed disclosure).

Management Reply:

i. The application of the secured lender in NCLT is yet to be admitted and the Company has not received any order from National Company Law Tribunal (NCLT) for the same.

ii. The Outcome has been duly submitted to NSE on 29th March, 2019 itself. However, inadvertently due to some technical error the outcome of the Board meeting held on 29th March, 2019 could not be filed on the Listing Center of BSE Limited. The said outcome was later submitted to BSE on April 11, 2019 at 6:17:55 p.m.

MAINTENANCE OF COST RECORDS:

Pursuant to the provisions of Section 148(1) of the Companies Act, 2013, the government has not prescribed maintenance of the cost records for services dealt with by the Company. Hence, the prescribed section for maintenance of cost records is not applicable to the Company during the financial year under review.

INTERNAL AUDITOR:

Pursuant to the provisions of Section 138 of the Companies Act, 2013, the company is required to appoint an internal auditor. Despite of constant efforts the Company could not identify a suitable candidate to be appointed as internal auditor of the Company. However, the Company is making rigorous efforts to search for suitable candidate for the said position.

INTERNAL FINANCIAL CONTROL:

Your Company has an adequate system for ensuring the orderly and efficient conduct of its business, including adherence to Company Policies, safeguarding of assets, prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and timely preparation of reliable financial disclosures. The Audit Committee evaluates the Internal Financial Control Systems and strives to maintain the Standards of Internal Financial Control. The details in respect of internal financial control and their adequacy are included in the Management Discussion and Analysis Report, which forms part of this Annual Report.

REPORT ON CORPORATE GOVERNANCE:

Pursuant to the Regulation 34 read with Schedule V of the Listing Regulations following have been made a part of the Annual Report and are attached to this report:

a. Management Discussion and Analysis Report; b. Report on Corporate Governance; c. Declaration on Compliance with Code of Conduct;

d. Certificate from Practicing Company Secretary that none of the Directors on the board of the company have been debarred or disqualified from being appointed or to act as director of the Company;

e. Certificate regarding compliance of conditions of Corporate Governance.

DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON CORPORATE SOCIAL RESPONSIBILITY INITIATIVES:

The provisions relating to Corporate Social Responsibility under Section 135 of the Companies Act, 2013 and rules made thereunder are not applicable to the Company. Therefore, the Company has not developed and implemented any policy on Corporate Social Responsibility initiatives.

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

There was no order passed by any regulator or court or tribunal, which impacts the going concern status of the Company or will have any bearing on Companys operations in future.

MATERIAL CHANGES AND COMMITMENT, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENT RELATES AND THE DATE OF THE REPORT:

No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year 2018-19 to which this financial statements relate and the date of this Report.

INFORMATION UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:

The Company has adopted a Policy on Prevention, Prohibition and Redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and with Rules made thereunder. The Company has constituted an Internal Committee under Section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The details of the complaints in relation to the Sexual Harassment of Women at Workplace filed/disposed/pending is given in the Report on Corporate Governance which is forming part of this Annual Report.

COMPLIANCE WITH SECRETARIAL STANDARDS:

The Company has devised proper systems to ensure compliance with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India and the Company has complied with all the applicable provisions of the same during the financial year under review.

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

Pursuant to Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, details regarding Conservation of Energy, Technology Absorption, Foreign Exchange earnings and outgo for the year under review are as follows:

Conservation of Energy:

a. Steps taken or impact on conservation of energy The Operations of the Company are not much energy intensive.

However, Company continues to implement prudent practices for saving electricity and other energy resources in day-today activities.

b. Steps taken by the Company for utilizing alternate sources of energy Though the activities undertaken by the Company are not much energy intensive, the Company shall explore alternative sources of energy, as and when the necessity arises.

c. The capital investment on energy conservation equipment Nil.

Technology Absorption:

a. The efforts made towards technology absorption the technology required for the business has been absorbed as and when required.

b. The benefits derived like product improvement, cost reduction, product development or import substitution Not Applicable.

c. In case of imported technology (imported during the last three years reckoned from the beginning of the financial year)

Not Applicable.

d. The expenditure incurred on Research and Development - Not Applicable.

Foreign Exchange earnings and Outgo: Nil

DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to the provisions of Section 134(3)(c) of the Companies Act, 2013, the Board of Directors state and confirm that:

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

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 loss of the Company for that period;

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; 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.

ACKNOWLEDGEMENT:

The Board of Directors express their gratitude for the valuable support and co-operation extended by various Government authorities and stakeholders including shareholders, banks, financial institutions, viewers, vendors and service providers.

The Board also places on record their deep appreciation towards the dedication and commitment of your Companys employees at all levels and looks forward for their continued support in the future as well.

By Order of the Board of Directors
Markand Adhikari
Place: Mumbai Chairman & Managing Director
Date: August 14, 2019 DIN: 00032016