Your Directors takes pleasure in presenting the Twenty-Third Annual Report of theoperations and business of your Company together with the Audited Statement of Accountsfor the year ended 31st March 2016.
1. FINANCIAL SUMMARY OF THE COMPANY:
|Financial results for the year ended ||31st March 2016 ||31st March 2015 |
|Total Income ||21607205 ||31280405 |
|Profit/ (Loss) before tax ||(81080694) ||10825550 |
|Less: Tax Expenses ||(21243860) ||1528117 |
|Profit / (Loss) for the year ||(59836834) ||9297433 |
|Add: Balance as per last financial statements ||(12606415) ||(19956606) |
|Less: Transfer to statutory reserve U/s 45-IC of || || |
|RBI Act 1934 || ||1859487 |
|Less: Transitional effect of || || |
|Depreciation on Fixed Asset || || |
|as per Companies Act 2013 || || |
|as on 1st April 2014 || ||87755 |
|Surplus/(Deficit) in the Statement of Profit and Loss ||(72443249) ||(12606415) |
2. STATE OF COMPANY AFFAIRS:
The financial statements of the company is prepared as per the applicable provisions ofsection 133 of Companies Act 2013 read with rule 7 of the Companies (Accounts) Rules 2014.In the year 2015-16 your company earned an income of Rs 21607205/- which relates toincome from Interest on loan amounting to Rs 14454827/- and profit on redemption/sale ofinvestments Rs 6568452/-. But due to provision for NPA of Rs 61196590/- and provisionagainst diminution of Current Investments for Rs 29363062/- your company has recordedloss of Rs 81080694/- before tax and a loss of Rs 59836834/- after tax for the yearunder review. The EPS of the company for the year ended 31.03.2016 is negative Rs 8.55.
The operating profit before provision of NPA and provision against diminution ofCurrent Investments stand to Rs 9305379/- for the year under review. The Loan book both secured and unsecured stood to Rs 152545694/- as on 31.03.2016.
The Financial Years 2015 16 have been full of changes in the regime. SEBIwitnessed itself by bringing out major amendment to listed companies by replacing existingListing Agreement with SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015 effective from 1st December 2015 and new Insider Trading Regulation2015 which was effective from 15th day of May 2015 so as to keep a check on dealing byInsiders in the securities of the company. Thus we find that listed entities are undercomplete vigilance in case of capital markets.
3. CHANGE IN NATURE OF BUSINESS:
There has been no change in nature of business of the company during the F.Y.2015-2016. Your company is engaged in financial services and no other business segment isthere and so there is only one segment reporting as per AS 17.
The company has incurred loss during the year under review and so Board of Directorshas decided not to recommend any dividend for the year ended 31st March 2016.
5. CHANGES IN SHARE CAPITAL:
There has being no change in the share capital of the company during the year 2015-16.At the end of the year as on 31st March 2016 the paid up Equity Share Capital as on 31stMarch 2016 stood at Rs 69964955 (includes forfeited shares capital).
6. TRANSFER TO RESERVE:
Your company has incurred loss during the year under review and so no amount has beentransferred to statutory reserve under section 45 IC of RBI Act 1934 for the year ended31st March 2016.
7. DIRECTORS & KEY MANAGERIAL PERSON:
In accordance with the Article of Association of the company and provisions ofCompanies Act 2013 Ms Anju Mundhra (Din : 06969718) retires by rotation and beingeligible seeks reappointment.
The board on recommendation of Nomination & Remuneration committee and approval ofshareholders in the Annual General Meeting held on 31st day of July 2015 revised theremuneration structure of Mr. Pawan Jain from
Rs 1500000/- p.a. to Rs 4200000/- p.a inclusive of salary benefits allowances andperquisite effective from 1st April 2015. Further Mr. Pawan Jain (Din : 00038076) wasreappointed as Managing Director & CEO of the company for a further period of 3 yearseffective from 1st December 2015 on recommendation of Nomination & Remunerationcommittee at a remuneration of Rs 8400000/- p.a. inclusive of salary benefitsperquisites and allowances effective from 01.12.2015 duly approved by shareholders in theAGM held on 31st July 2015.
The Board of Directors appointed Mr. Daulat Jain as an additional director (Promoternon Executive) w.e.f. 14th January 2016 pursuant to section 161 of Companies Act2013 and shall hold office up to the date of ensuing Annual General Meeting and shall beliable to retire by rotation. The company has received a notice as per the provision ofsection 160(1) of Companies Act 2013 from a member proposing his appointment asdirector.
The Board of Directors appointed Mr Sanjay Kr Singh ( Din 00003695) as an additionaldirector (Independent Director) w.e.f. 14th January 2016 pursuant to section 161 ofCompanies Act 2013 for a period of 5 consecutive years and shall hold office up to thedate of ensuing Annual General Meeting and shall not retire by rotation. The company hasreceived a notice as per the provision of section 160(1) of Companies Act 2013 from amember proposing his appointment as director.
All the Independent Directors have given a declaration that they meet the criteria ofindependence as laid down under Section 149(6) of the Act and as per regulation 25 of SEBI(LODR) Regulations 2015 all requisite declarations were placed before the Board.
Pursuant to regulation 36 of SEBI (LODR) Regulations 2015 a brief resume / detailsrelating to Directors who are proposed to be appointed/re-appointed are furnished in theNotice of the ensuing AGM.
The major highlights of the Remuneration Policy of the Company framed onDirectors appointment and remuneration including criteria for determiningqualifications positive attributes independence of a Director and other matters providedunder sub-section (3) of section 178 are disclosed in the Corporate Governance Report .
KEY MANAGERIAL PERSONNEL
In terms of section 203 of Companies Act 2013 and rules made thereon the following arethe Key Managerial Personnel of the company during the F.Y. 2015- 16.
1) Mr. Pawan Jain Managing Director & CEO
2) Ms. Anju Mundhra Executive Director Legal & Company Secretary
3) Mr. Amit Jain Chief Financial Officer
8. NUMBER OF MEETINGS OF THE BOARD:
The company has duly complied with section 173 of the Companies Act 2013. Duringthe year under review Four board meetings were convened and held. The date on whichmeeting were held are as follow 1st May 2015 31st July 2015 27th October 2015 14thJanuary 2016 and further there was a circular meeting held on 28th April 2015 .Themaximum interval between any two meetings did not exceeded 120 days.
9. FORMAL ANNUAL EVALUATION:
During the year the Board has carried out the annual evaluation of its own performanceas well as the evaluation of the working of its Committees and individual Directors. Thisexercise was carried out through a structured questionnaire prepared separately for BoardCommittee and individual Directors on the basis of the following parameters:
1) Composition of Board and committee
2) Attendance of Board Meetings and Board Committee Meetings
3) Quality of contribution to Board deliberations
4) Experience & competencies
5) Strategic perspectives or inputs regarding future growth of Company and itsperformance
6) Ethics and compliance
Separate exercise was carried out to evaluate the performance of chairman and ManagingDirector on basis of the parameters such as contribution independent judgement effectiveleadership to the Board safeguarding of minority shareholders interest etc . Based onaforesaid parameters the performance of the Board various Board Committees viz. AuditCommittee Stakeholders Relationship Committee Nomination and RemunerationCommittee and Individual Directors (including Independent Directors) was carried out andevaluated to be satisfactory.
During the year under review the Independent Directors of your Company carried out theperformance evaluation of Non- Independent Directors and Chairperson at a separate meetingof Independent Director.
The Directors were satisfied with the Evaluation Results which reflects the overallengagement of board and its committee with the company. Boards actions and decisionsare aligned with the Companys best interest. All Directors are interactive andparticipative. The Directors at the individual level enhances the value of boardseffectiveness by elevating its knowledge and integrating the same in all desired ways soas to commit to the goal of sustainably elevating the Companys value creation forthe long term. The Chairman has wide knowledge and vast experience and skills andunderstanding of the Boards Functioning.
10. MANAGERIAL REMUNERATION:
The statement containing the disclosure as required in accordance with the provisionsof Section 197(12) of the Companies Act 2013 read with rule 5 (1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexed as AnnexureA. and forms part of the Board Report.
Further none of the employees of the Company are in receipt of remuneration exceedingthe limit prescribed under rule 5 (2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 so statement pursuant to Section 197(12) of theCompanies Act 2013 read with rule 5(2) and 5(3) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is not required to be included.
11. DETAILS OF SUBSIDIARY / JOINT VENTURES / ASSOCIATE COMPANIES:
Your Company has neither a Subsidiary Company nor a Joint Venture Company or anAssociate Company during the year under review.
STATUTORY AUDITOR :
M/s. P.K Sah & Associates Chartered Accountants was appointed as StatutoryAuditors of the Company for a period of 3 years pursuant to section 139(2) of theCompanies Act 2013 and rules made thereon in the Annual General Meeting held on 2ndSeptember 2014. The company has received letter from them to the effect that theirappointment if ratified would be within the prescribed limit under section 141 of theCompanies Act 2013 and they are not disqualified for appointment. Accordingly a resolutionseeking members ratification for the
10 appointment of M/s. P.K.Sah & Associates as Statutory Auditor for the F.Y.2016-2017 is included in the Notice convening the ensuing Annual General Meeting.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s. MR & Associates Company Secretaries to undertake the Secretarial Auditof the Company for the financial year 2015-16. The Secretarial Audit Report for the yearended 31st March 2016 is annexed herewith as Annexure B.
Pursuant to the provisions of Section 138 of the Companies Act 2013 and rules framedthereon your Company has appointed M/s. Shyamsukha Amit & Associates CharteredAccountant to undertake the Internal Audit of the Company for the F.Y. 2015-2016. Therestood no adverse finding & reporting by the Internal Auditor in the Internal AuditReport for the year ended 31st March 2016.
There are no qualifications reservation or adverse remarks made by M/s. P.K.Sah &Associates the Statutory Auditor in their Audit Report on the financial statements forthe year ended 31st March 2016 and by M/s. MR.& Associates Company Secretaries intheir Secretarial Audit Report.
The Statutory Auditor has not reported any incident of fraud to the Audit Committee ofthe company in the year under review.
With a view to have a more focused attention on business and for better governance andaccountability and in accordance with applicable provisions your Board has the followingmandatory committees viz. Audit Committee Stakeholders Relationship Committee andNomination and Remuneration Committee. The details of the committee with terms ofreference along with composition and meeting held during the year are provided in theReport on Corporate Governance a part of this Annual Report.
14. VIGIL MECHANISM / WHISTLE BLOWER POLICY:
Your Company has established a vigil mechanism for
Directors and employees to report their genuine concerns and about unethical behavioractual or suspected fraud or violation of the Codes of Conduct or Ethics policy. It hasadopted a Whistle Blower Policy and the same is hosted on the website of the company(http://www.ashikagroup.com/ PDF/ VIGIL_MECHANISM.pdf). The details of the said vigilmechanism have been given in the Corporate Governance Report annexed to this Report.
15. RISK MANAGEMENT POLICY:
Pursuant to section 134(n) of Companies Act 2013 and Regulation 17(9) of SEBI (ListingObligation and Disclosure Requirements) Regulations 2015 your company has a robust Riskmanagement framework to identify evaluate business risk and opportunities. This frameworkseeks to create transparency minimize adverse impact on the business objectives andenhance the competitive advantage. The framework has a different risk model which helps inidentifying risk trends exposure and potential impact analysis at a company level. Thekey business risk identified by the company is disclosed in the Corporate Governancereport.
16. CORPORATE SOCIAL RESPONSIBILITY:
The Company had not taken any initiatives on the activities of Corporate SocialResponsibilities as the provisions relating to the same are not applicable to the Company.
17. EXTRACT OF ANNUAL RETURN:
Companies Act 2013 makes mandatory for every company to prepare an extract in theformat prescribed MGT 9. The detailed extract forming part of the Annual Return as on 31stMarch 2016 is annexed herewith as Annexure - C.
18. MATERIAL CHANGES:
There have been no material changes and commitments affecting the financial position ofthe company which have occurred since 31st March 2016 being the end of the FinancialYear of the Company to which financial statements relate and the date of the report.
19. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURT OR TRIBUNALSIMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATION IN FUTURE:
There are no significant material orders passed by the Regulators / Courts/Tribunalswhich would impact the going concern status of the Company and its future operations.
There stood a complaint filed by Manali Properties Limited and M/s. Manali Properties& Finance Private Limited against company & its officers u/s 200 of the CriminalProcedure Code before the Court of Metropolitan Magistrate Kolkata. Pursuant to the saidcomplaint your company had made an application u/s 482 to Honble High CourtCalcutta and the court has granted a stay order on 12.09.2012. The matter is till datepending before Bankshall Court and High Court Kolkata.
20. INTERNAL FINANCIAL CONTROL SYSTEM AND THEIR ADEQUACY:
The Company Internal Financial Control System are commensurate with the size scale andcomplexity of its operations. Detailed procedural manuals are in place to ensure that allthe assets are safeguarded protected against loss proper prevention & detection offrauds & error the accuracy and completeness of the accounting records and alltransactions are authorized recorded and reported correctly. The scope and authority ofthe Internal Audit (IA) function is defined in the internal financial control policy.These are routinely monitored and evaluated by the Statutory as well as Internal Auditors.
The Internal Auditor monitors and evaluates the efficiency and adequacy of InternalFinancial Control System in the Company its compliance with operating systems accountingprocedures and policies. To maintain its objectivity and independence the InternalAuditor reports directly to the Chairman of the Audit Committee of the Board all thesignificant audit observations and follow up actions thereon. Both Statutory and InternalAuditor have quarterly sessions with the Audit committee. The Internal audit report areplaced before the Audit committee on quarterly basis and all findings and observation arerecorded thereon. The said observation and comments if any of the Audit Committee areplaced before the board.
2 1. PARTICULARS OF LOANS GUARANTEES OR
INVESTMENTS UNDER SECTION 186 OF COMPANIES ACT 2013:
Your Company being the Non Banking Financial Company having the principal business ofproviding loans is exempted from the provisions of Section 186 of the Companies Act 2013to the extent of providing loans giving guarantee and providing security in connectionwith loan.
However the details of investments covered under the provisions of Section 186 of theCompanies Act 2013 are given in notes to the financial statement
Your company is Non Deposit taking NBFC registered with RBI thus the said clause isnot applicable and the company does not accept any deposit. The Board of Directors hasduly passed a resolution in their meeting giving effect to the aforesaid statement.
23. CONTRACTS/ TRANSACTIONS / ARRANGEMENTS WITH RELATED PARTIES:
All contracts/ arrangements/transactions with related parties entered by the companyduring the financial year 2015-16 were at arms length basis and in the ordinarycourse of business and are in compliance with the applicable provision of the CompaniesAct 2013 and SEBI (LODR) Regulations 2015 (Previously Listing Agreement). There were nomaterially significant related party transactions made by the company with PromotersDirectors KMPs or other designated person which may have a potential conflict with theinterest of the company at large.
Particulars of contracts or arrangements or transactions entered into by the companywith related parties covered u/s 188 (1) of Companies Act 2013 is mentioned in form AOC 2 and is appended as Annexure D to the Board Report .
In terms of Regulation 23 of SEBI (Listing Obligation and Disclosure Requirements)Regulations 2015 which came in to effect w.e.f. 1st December 2015 and as per section 177of Companies Act 2013 read with rules thereon all related party transactions are placedbefore the Audit Committee for review and approval. The Board of Directors of the Companyhas approved the criteria for making the omnibus approval by the Audit Committee withinthe overall framework of the policy on Related Party Transactions. Prior omnibus approvalof the Audit Committee is obtained for the transactions which are of a foreseen andrepetitive nature.
A Related Party policy has been devised by the Board of Directors for determining themateriality of transactions with related parties and dealing with them and is hosted onthe website (www.ashikagroup.com) of the company and the link to the said policy has beenprovided elsewhere in the Annual Report. The detailed related party transactions aredisclosed in the Corporate Governance report and in the financial statements which formsa part to the Annual report.
Pursuant to Regulation 23 of SEBI (LODR) Regulations 2015 which came in to effectw.e.f. 1st December 2015 which specify that all existing material RPTs entered prior tothe notification of SEBI (LODR) Regulations 2015 and which are likely to continue beyondDecember 01 2015 is being placed for approval of the Members at the ensuing 23rd AnnualGeneral Meeting.
24. CORPORATE GOVERNANCE REPORT:
Pursuant to Regulation 34 of SEBI (Listing Obligation and Disclosure Requirements)Regulations 2015 with the Stock Exchanges the report on Corporate Governance andManagement Discussion & Analysis forms part of the Annual Report. The Certificate fromthe Secretarial Auditor of the company confirming compliance with the conditions ofCorporate Governance as stipulated under Schedule V of Regulation 34 of SEBI (ListingObligation and Disclosure Requirements) Regulations 2015 also constitute an integral partof the Annual Report.
25. DISCLOSURES ON POLICY AGAINST SEXUAL AND WORKPLACE HARASSMENT:
The company has adopted the policy on redressal of Sexual and Workplace harassment asper the Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal)Act 2013 ("Sexual Harassment Act"). and the same is displayed at the website ofthe company (http://www.ashikagroup.com/ PDF/sexual%20 harassment%20policy-ACCL.pdf). TheCompany believes that it is the responsibility of the organisation to provide anenvironment to its employee who is free of discrimination intimidation and abuse and alsoto protect the integrity and dignity of its employees and to avoid conflicts anddisruptions in the work environment. Further there stood no cases filed during the yearunder review.
26. CONSERVATION OF ENERGY TECHNOLOGY
ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGOES:
Since the Company does not own any manufacturing facility the requirements pertainingto disclosure of particulars relating to conservation of energy technology absorption andforeign exchanges earning and outgo as prescribed under the Companies (Disclosure ofParticulars in the Report of Board of Directors) Rules 1988 are not applicable.
27. DIRECTORS RESPONSIBILITY STATEMENT:
Your Directors to the best of their knowledge and belief and according to theinformation and explanation obtained by them make the following statement in terms ofclause (c) of sub-section (3) of section 134 of Companies Act 2013 that
a) In the preparation of the annual accounts for the financial year ended on 31st March2016 the applicable accounting standards had been followed along with proper explanationrelating to material departures;
b) The directors have selected such accounting policies and applied them consistentlyand made judgements and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company as at 31st March 2016 and of the profitand loss of the company for that period;
c) The directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;
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 thecompany and that such internal financial controls are adequate and were operatingeffectively; f) The directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
Your Directors take the opportunity to thank the Regulators Organizations and Agenciesfor the continued help and co-operation extended by them. The Directors also gratefullyacknowledge all stakeholders of the Company viz. customers members vendors banks andother business partners for the excellent support received from them during the year. TheDirectors place on record their sincere appreciation to all employees of the Company fortheir unstinted commitment and continued contribution to the Company.
| ||For and on behalf of the Board of Directors |
| ||(PAWAN JAIN) |
|Place: Kolkata ||Chairman & Managing Director |
|Date: 29/05/2016 ||DIN: 00038076 |