Visagar Financial Services Ltd Directors Report.

The Members,

VISAGAR FINANCIAL SERVICES LIMITED

Your Directors are pleased to present their 28th Annual Report together with the Audited Financial Statements for the financial year ended March 31, 2021 and the Auditors Report thereon.

1. Business Performance

(In Lacs)

PARTICULARS YEAR ENDED 31.03.2021 YEAR ENDED 31.03.2020
Revenue from operations 6,658.43 152.11
Other income - -
Gross Income 6,658.43 152.11
Total Expenses 6,693.15 180.56
Net Profit Before Tax -34.72 -28.45
Provision for Tax - -
Net Profit After Tax -34.72 -28.45

2. Operations and Future Plans

During the year under review the Companys Turnover has increased from Rs. 152.11 Lakhs in FY 19-20 to Rs. 6,658.43 Lakhs in FY 20-21 and the expenses during the year has also been increased from Rs. 180.56 Lakhs in FY 19-20 to Rs. 6,693.15 Lakhs in FY 20-21. However, there is net loss in the Company of Rs. -34.72 Lakhs compared to net profit of Rs. Rs. 28.45 Lakhs in the previous year.

Your Company is optimistic about the coming year. Since the Company is trying to reduce cost and expand its business, your directors are hopeful that the results will be more encouraging.

Impact of Covid-19

During the last quarter of the year under review the incidence of Covid-19 developed into a global pandemic. The directors have assessed the impact of Covid-19 on the business at the balance sheet date and there are significant adverse impact in business revenue and changes as of the balance sheet date. The company continues to provide the services to its customers, although some parts of the business have been disrupted due to the current lockdown conditions in most part of the country. Due to the worldwide uncertainty caused by Covid-19, and its potential to impact the company, the company has put in place mitigation plans to minimize the adverse impact on both revenue and profitability. There are no material changes or commitments affecting the financial position of the Company between the end of the financial year and the date of the report.

3. Dividend

In order to plough back the profit, your Directors have not recommended any dividend for the year ended March 31, 2021.

4. Share Capital

The Issued, Subscribed & Paid up Capital of the Company as on March 31, 2021 stands at Rs. 65,018,000/- divided into 32,509,000 Equity Shares of Rs. 2/- each. During the period under review, the Company has not issued shares with differential voting rights nor granted any stocks options or sweat equity.

5. Transfer to Reserve

The Board does not propose to make transfer to reserves for the year 2020-21 as company has incurred net loss of Rs. -34.72 Lakhs as on March 31, 2021.

6. Directors and Key Managerial Personnel i) Retire by Rotation:

In accordance with the provisions of Section 152 of the Act, and that of Articles of Association of the Company, Mr. Tilokchand Manaklal Kothari (DIN: 00413627) Director of the Company retires by rotation at this Annual General Meeting of the Company and being eligible, offers herself for reappointment.

ii) Change in Directors and Key Managerial Personnels:

During the year Mrs. Asha Tilokchand Kothari is resigned dated 15th January, 2021 from the Directorship of the Company.

iii) Composition of Board of Directors and Key Managerial Personnels:

As on the date of this Boards Report, i.e., as on September 02, 2021, your Companys Board of Directors comprises of the following Directors:

Name of the Director Director Identification Number (DIN) Category
Mr. Tilokchand Manaklal Kothari 00413627 Executive Director
Mrs. Asha Tilokchand Kothari (Resigned on 15th January, 2021) 01040247 Chairperson & Non-Executive Director
Mr. Kailash Ram Gopal Chhaparwal 01211651 Non-Executive Director
Mr. Kuldeep Kumar 08373716 Non-Executive Independent Director
Mr. Sanjay Rajak 08417877 Non-Executive Independent Director
Ms. Madhu Bala Vaishnav 08376551 Non-Executive Independent Director

Companys Key Managerial Personnel are as follows:

Name of KMP Designation
Mr. Kalpesh Kantilal Khut Chief Financial Officer
Mr. Sagar Tilokchand Kothari Chief Executive Officer
Ms. Shalini Bose* Company Secretary and Compliance Officer
Ms. Sonam Sudhakar Prajapati** Company Secretary and Compliance Officer

* Ms. Shalini Bose resigned from the position of Company Secretary w.e.f 06.05.2020. ** Ms. Sonam Sudhakar Prajapati appointed as a Whole time Company Secretary w.e.f 15.01.2021.

7. Board Evaluation

Your Board has carried out an annual evaluation of its own performance, Board committees and individual Directors pursuant to the provisions of the Act and the corporate governance requirements as prescribed by SEBI (Listing Obligations and Disclosures Requirement) Regulations, 2015.

The performance of the Board was evaluated by the Board after seeking inputs from all the directors on the basis of the criteria such as the board composition and structure, effectiveness of board processes, information and functioning, etc.

The performance of the Committees was evaluated by the board after seeking inputs from the Committee Members on the basis of the criteria such as the composition of committees, effectiveness of committee meetings, etc.

Board and the nomination and remuneration committee reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the chairman was also evaluated on the key aspects of his role.

8. Meetings of the Board

During the year ended March 31, 2021, Eight (8) Board Meetings were held by the Company on 06th May, 2020, 29th June, 2020, 03rd August, 2020,12th September, 2020, 12th November, 2020, 03rd December, 2020, 15th January, 2021 and 12th February, 2021.

9. Details of Committees of the Board

Currently, the Company has three (3) Committees namely Audit Committee, Nomination and Remuneration Committee & Stakeholders Relationship Committee. The detailed composition of various Committees is elucidated below:

i) Audit Committee

The Audit Committee comprises of three Directors as on 31st March, 2021 namely Mr. Sanjay Rajak, Mr. Kuldeep Kumar and Ms. Madhu Bala Vaishnav. The aforesaid Members of the Committee operate in the capacity of Independent Directors respectively. The Chairman of the Committee is Mr. Sanjay Rajak who is an Independent Non-Executive Director. The recommendations of the Audit Committee are always welcomed and accepted by the Board & all the steps impacting the financials of the Company are undertaken only after the consultation of the Audit Committee. During the period ended 31st March, 2021, Four (4) Board Meetings were held by the Company on 29th June, 2020, 12th September, 2020, 12th November, 2020 and 12th February, 2021. Composition of Audit Committee are as follows:

Name of Member Designation Category
Mr. Sanjay Rajak Chairman Independent, Non-Executive Director
Mr. Kuldeep Kumar Member Independent, Non-Executive Director
Ms. Madhu Bala Vaishnav Member Independent, Non-Executive Director

ii) Nomination & Remuneration Committee

The Committee was constituted pursuant to provisions under Section 178 of the Companies Act, 2013. As on 31st March, 2021; the Committee consists of three (3) Members, namely Mr. Sanjay Rajak, Mr. Kuldeep Kumar and Ms. Madhu Bala Vaishnav. The aforesaid Members of the Committee operate in the capacity of Independent Directors respectively. The Chairman of the Committee is Mr. Sanjay Rajak who is an Independent Non-Executive Director. During the year ended 31st March, 2021, Four (4) Board Meetings were held by the Company on 29th June, 2020, 12th September, 2020, 12th November, 2020 and 12th February, 2021.

Nomination and Remuneration Committee Policy

The Board has on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy is annexed as “Annexure A” to this report. The policy is also available in the website of the Company i.e. http://vfsl.visagar.com/vfslinvestors.html

Composition of Nomination and Remuneration Committee are as follows:

Name of Member Designation Category
Mr. Sanjay Rajak Chairman Independent, Non-Executive Director
Mr. Kuldeep Kumar Member Independent, Non-Executive Director
Ms. Madhu Bala Vaishnav Member Independent, Non-Executive Director

iii) Stakeholders Relationship Committee

The Committee oversees all the matters relating to Stakeholders grievances/complaints. The role of the Committee is to consider & resolve securities holders complaint. As on 31st March, 2021; the Committee consists of three members, namely Mr. Sanjay Rajak, Mr. Kuldeep Kumar and Ms. Madhu Bala Vaishnav. The aforesaid Members of the Committee operate in the capacity of Independent Directors respectively. The Committee is chaired by Mr. Sanjay Rajak as Non-Executive Independent Director. During the year ended March 31, 2021, Four (4) Board Meetings were held by the Company on 29th June, 2020, 12th September, 2020, 12th November, 2020 and 12th February, 2021.

Composition of Stakeholders Relationship Committee are as follows:

Name of Member Designation Category
Mr. Sanjay Rajak Chairman Independent, Non-Executive Director
Mr. Kuldeep Kumar Member Independent, Non-Executive Director
Ms. Madhu Bala Vaishnav Member Independent, Non-Executive Director

10. Declaration of Independence from Independent Directors

Your Company has received declarations pursuant to Section 149(7) of the Companies Act, 2013 from all the Independent Directors confirming that they meet the criteria of independence laid down under Section 149(6) of the Companies Act, 2013. Based on the declaration(s) of Independent Directors, the Board of Directors recorded its opinion that all Independent Directors are independent of the Management and have fulfilled the conditions as specified in the Companies Act, 2013, rules made thereunder as well as applicable provisions of the SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015.

11. Internal Control Systems and their Adequacy

The Management continuously reviews the internal control systems and procedures for the proficient conduct of the Companys business. The Company adheres to the prescribed guidelines with respect to the transactions, financial reporting and ensures that all its assets are safeguarded and protected against losses. The Internal Auditor of the Company conducts the audit on regular basis and the Audit Committee periodically reviews internal audit reports and effectiveness of internal control systems. Apart from the above, the Company in consultations with the external and independent consultants adopted a policy for development and implementation of risk management for the company including identification of elements of risk, if any, that may threaten the existence of the Company and a mechanism to mitigate the same.

12. Directors Responsibility Statement

Pursuant to Section 134(5) of the Companies Act, 2013, the Directors of your Company 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 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 had prepared the annual accounts on a going concern basis; e) the directors had 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 had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

13. Change in the Nature of Business

During the period under review, there is no change in the nature of business of the Company. The Company continues to operate in the NBFC (Non- Banking Financial Company) Sector.

14. Extract of Annual Return

The extract of Annual Return in Form MGT-9 as required under Section 92 of the Companies Act, 2013 (herein after referred to as "the Act") forms an integral part of this Report as “Annexure B”.

15. Prevention of Sexual Harassment Policy

In order to prevent sexual harassment at workplace, your Company has adopted a Policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rule made thereunder. During the year under review, there were no cases filed or reported pursuant to the provisions of the said Act.

16. Auditors & their Report

a) Statutory Auditor:

S.C. Mehra & Associates, Chartered Accountants (Firm Registration No: 106156W) is the Statutory Auditors of the Company appointed at the AGM in the year 2017 for the period of 5 years till the conclusion of the Annual General Meeting to be held in the year 2022.

There is no audit qualification, reservation or adverse remark for the Financial year under review.

b) Secretarial Auditor:

In compliance with the provisions of Sec 204 and other applicable provisions of Companies Act 2013, the Board of Directors have appointed M/S VRG & Associates, Practising Company Secretary as Secretarial Auditors to undertake Secretarial Audit of the Company for the financial year ended March 31, 2021. The Secretarial Audit Report is attached herewith marked as “Annexure C” and forms an integral part of this report.

The Secretarial Auditor has made and mentioned the following observation in his report:

1. During the year company has maintain minutes of board meeting and other committee in electronic mode.

2. As per Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 Newspaper publication is not uploaded for Intimation of Board Meeting for the quarter ended 29th June, 2020.

3. On BSE site the status of the company is showing “Additional Surveillance Measure” (ASM).

4. Company has appointed Independent Directors but the name of the Independent Directors has not registered under the Database of Independent Directors.

c) Internal Auditor:

M/s. Lakhpat M Trivedi & Co., Chartered Accountants, Mumbai (Membership No. 109047) was appointed as Internal Auditor of the Company for the FY 2020-21 and the Internal Audit Report prepared by them was placed before the Audit Committee.

17. Risk Management

Risk Management is the process of identification, assessment, and prioritization of risks followed by coordinated efforts to minimize, monitor and mitigate/control the probability and/or impact of unfortunate events or to maximize the realization of opportunities. The Company has laid a comprehensive Risk Assessment and Minimization Procedure, which is reviewed by the Audit committee and approved by the Board from time to time. These procedures are reviewed to ensure that executive management controls risk through means of a properly defined framework. The policy has been hosted on Companys website www.vfsl.org.

18. Public Deposits

The Company has not accepted any deposit from the general public within the meaning of section 73 of the Companies Act, 2013 and the rules made there under.

19. Particulars of Contracts/ Arrangements with Related Party

During the year, there were no related party transactions made in the Company, therefore Form AOC-2 is not applicable to the Company. 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 at the link: http://vfsl.visagar.com/attachments/policyrtp.pdf.

20. Particulars of Loans, Guarantees or Investments by the Company under section 186

Details of Loan, Guarantees and Investments covered under the provisions of the Act, are disclosed in the notes to the Financial Statements.

21. Material Changes affecting the financial position of the Company

During the year ended March 31, 2021, there were no material changes and commitments affecting the financial position of the Company have occurred to which financial results relate and the date of the Report.

22. Corporate Social Responsibility Committee

Since the provisions as laid down in the Section 135 of the Companies Act, 2013 are not applicable to the Company; hence no such Committee has been formed. However, Company had always tried in its best possible ways to involve itself in social development activities.

23. Dematerialisation of Shares

Your Company has connectivity with the National Securities Depository Limited (NSDL) & Central Depository Services (India) Limited (CDSL) for dematerialization of its Equity Shares. The ISIN No INE309H01020 has been allotted for the Company Shares. Therefore, the members and/or investors may keep their shareholdings in the electronic mode with their Depository Participant.

As on March 31, 2021, 87.88% of the paid up Equity Share Capital stands in Demat mode and the remaining 12.12% Equity Shares were held in physical mode, the details of which are as follows:

Particulars No. of Shares % of Capital Total
Held in Demat form with CDSL 1,76,66,873 54.34%
Held in Demat form with NSDL 1,09,01,058 33.53%
Held in physical mode 39,41,069 12.12%

24. Listing of Shares

The shares of your Company are listed at BSE Limited. The applicable Annual Listing fees have been pending for payment to the Stock Exchange for the financial year 2020-21.

25. Subsidiary Companies

The Company does not have any Subsidiary Company.

26. Vigil Mechanism/Whistle Blower Policy

Pursuant to the provisions of the Companies Act, 2013 read with the Companies (Meeting of Board and its Powers) Rules, 2014 and SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, every listed Company is required to have a Vigil Mechanism/ Whistle Blower Policy for the Directors and employees to report their concerns and grievances. The Company has a Whistle Blower Policy in place and the same is also available on the web-site at the web-link http://vfsl.visagar.com/attachments/whistleblowerpolicyVigilmechanism.pdf

The Audit Committee of Directors are entrusted with the responsibility to oversee the Vigil mechanism.

27. Corporate Governance

In terms of Regulation 15(1) of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, the provisions related to Corporate Governance as specified in Regulation 17 to 27 and Clause (b) to (i) of sub-regulation (2) of regulation 46 and para C, D and E of schedule V shall not be applicable in respect of companies having paid up equity share capital not exceeding Rs.10 Crore and Net worth not exceeding Rs.25 Crore as on the last day of the previous financial year.

As on March 31, 2021, the Equity Share Capital is Rs. 6,50,18,000 and Net worth is Rs. 117,072,853 /-. Hence, the company is not providing a separate report on corporate governance, and also a certificate from the Companys Auditors confirming the compliance of Corporate Governance. However, the Company continues to adhere to the best practices prevailing in Corporate Governance and follows the same in its true spirit.

28. Secretarial Standards of ICSI

Pursuant to the approval given on April 10, 2015 by the Central Government to the Secretarial Standards specified by the Institute of Company Secretaries of India, the Secretarial Standards on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2) came into effect from July 01, 2015. The Company is in compliance with the same.

29. Significant and Material Orders Passed by the Regulators or Courts:

There are no significant and material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.

30. Management Discussion and Analysis

Management Discussion and Analysis Report is appended to this Annual Report.

31. Particulars of Employees

The information required pursuant to Section 197 read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the reports and accounts are being sent to the members and others entitled thereto excluding the information on employees particulars which is available for inspection by the members at the Registered office of the company during business hours on working days of the company up to the date of ensuing Annual General Meeting. If any member is interested in inspecting the same, such member may write to the company secretary in advance.

No employee has received remuneration in excess of the limits set out in rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 during FY 2020 21.

32. Conservation of Energy, Technology Absorption and Foreign Exchange Earning & Outgo

There was no technology absorption and no foreign exchange earnings or outgo, during the year under review. Hence, the information as required under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 is to be regarded as Nil.

The Company has not entered into any technology transfer agreement.

33. Acknowledgement

Your Directors take this opportunity to express their grateful appreciation for the excellent assistance and co-operation received from all our Clients, Bankers, Business Associates and the Government and other regulatory authorities and thank all stakeholders for their valuable sustained support and encouragement towards the conduct of the proficient operation of the Company. Your Directors would like to place on record their gratitude to all the employees who have continued their support during the year.

By Order of the Board of Directors

For Visagar Financial Services Limited

Sd/- Sd/-
Date: September 02, 2021 Tilokchand Kothari Kailash Ram Gopal
Chhaparwal
Place: Mumbai Director Director
DIN: 00413627 01211651