Avon Mercantile Ltd.
|BSE: 512265||Sector: Financials|
|NSE: N.A.||ISIN Code: INE471D01019|
|BSE 05:30 | 01 Jan||Avon Mercantile Ltd|
|NSE 05:30 | 01 Jan||Avon Mercantile Ltd|
|BSE: 512265||Sector: Financials|
|NSE: N.A.||ISIN Code: INE471D01019|
|BSE 05:30 | 01 Jan||Avon Mercantile Ltd|
|NSE 05:30 | 01 Jan||Avon Mercantile Ltd|
Avon Mercantile Limited
The Board of Directors of your Company have pleasure in placing before the Members the32nd Annual Report together with the Audited Statement of Accounts of theCompany for the year ended on 31st March 2017.
> FINANCIAL HIGHLIGHTS
The financial highlights of the Company during the year under review are as under:
During the year under review the total revenue of the Company was Rs. 386.20 Lakhsconsisting of revenue from operations for Rs. 364.17 Lakhs and other Income for Rs. 22.03Lakhs as against the total revenue of the Company was Rs. 269.17 Lakhs consisting ofrevenue from operations for Rs. 268.31 Lakhs and other Income for Rs. 0.86 Lakh during theprevious financial year 2015-16. The profit for the year under review is Rs. 17.79 Lakhsas compared to profit of Rs. 13.01 Lakhs during the previous financial year.
> STATE OF COMPANY'S AFFAIRS AND FUTURE OUTLOOK
During the year under review the Company being a Non-Banking Financial Company hascarried out its main activity of lending funds. The Company intends to continue the sameline of business in future as well.
For the purpose of business growth and expansion the Board of Directors of the Companyhave not recommended any dividend for the Financial Year ending 31st March2017.
> TRANSFER TO RESERVES
During the year under review the Company has transferred Rs. 3.56 Lakhs to theReserves Fund from the profits of the Company in accordance with the provisions of Section45-IC of the Reserve Bank of India Act 1934.
> CHANGES IN SHARE CAPITAL
During the year under review there was no change in the Authorized and paid up sharecapital of the Company.
> EXTRACT OF ANNUAL RETURN
Pursuant to the provisions of section 92 of the Companies Act 2013 ("Act")and Rule 12(1) of the Companies (Management and Administration) Rules 2014 the extract ofAnnual return in Form No. MGT-9 is annexed herewith as ANNEXURE-I and forms part of thisreport.
> NUMBER OF BOARD MEETINGS
During the year under review four meetings of the Board were held on 25/05/201610/08/2016 14/11/2016 and 13/02/2017 respectively.
> PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS
The particulars of loans guarantees and investments have been disclosed in thefinancial statements.
> PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
During the year under review the Company has not entered into any contract orarrangement with related parties under section 188 of the Act. The form AOC-2 is enclosedto this Report as ANNEXURE - II.
> MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There is no material change and commitment affecting the financial position of theCompany between the end of the Financial Year of the Company to which financial statementsrelate and the date of report.
> CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO
The information pertaining to conservation of energy technology absorption Foreignexchange Earnings and outgo as required under Section 134 (3)(m) of the Act read with Rule8(3) of the Companies (Accounts) Rules 2014 is annexed herewith as ANNEXURE-III and formspart of this report.
> SUBSIDIARIES JOINT VENTURES OR ASSOCIATE COMPANIES
During the year under review no company has become or ceased to be its SubsidiaryJoint Venture or Associate Company.
> INTER-SE TRANSFER OF PROMOTERS' SHAREHOLDING
During the year under review there was inter-se transfer of shares between PromoterGroup whereby 367500 and 364750 equity shares held by Positive Investment Pvt Ltd andProtective Investment Pvt Ltd respectively aggregating to 732250 equity shares weretransmitted in favour of Smart Entertainment Private Limited representing 9.79% of thetotal paid-up share capital pursuant to order dated 25th May 2016 passed byHon'ble High Court of Judicature at Allahabad Uttar Pradesh approving the merger ofPositive Investment Pvt Ltd and Protective Investment Pvt Ltd with Smart Entertainment PvtLtd.
Consequent to the inter-se transfer among the Promoter Group the Promoter'sShareholding as on 31st March 2016 and 31st March 2017 was asfollows:
Note: Positive Investment Pvt Ltd and Protective Investment Pvt Ltd ceased to exist ason 27th June 2016 pursuant to order dated 25th May 2016 passed byHon'ble High Court of Judicature at Allahabad Uttar Pradesh approving the merger ofPositive Investment Pvt Ltd and Protective Investment Pvt Ltd with Smart Entertainment PvtLtd and Form INC-28 filed with the Registrar of Companies Uttar Pradesh & Uttrakhandon 27th June 2016.
> RISK MANAGEMENT POLICY
The Company believes that managing risks goes hand-in-hand with maximum returns. Tothis effect there is a robust process in place to identify key risks and prioritise therelevant action plans to mitigate these risks. Risk management framework is reviewedperiodically like review of compliance and regulatory matters by the Board Members.
> DIRECTORS AND KEY MANAGERIAL PERSONNEL
The Board of your Company is duly constituted with proper balance of Non-ExecutiveDirectors (including Woman Director) and Independent Directors. During the year underreview there was no change in the composition of the Board of Directors of the Company.
i) RE-APPOINTMENT OF RETIRING DIRECTOR
Mr. Vikas Kapoor (DIN: 03020854) is liable to retire by rotation and being eligibleoffers himself for re-appointment. The Directors recommend Mr. Vikas Kapoor forreappointment.
His brief resume and other details are furnished in the Notice for the Annual GeneralMeeting as ANNEXURE - A.
ii) INDEPENDENT DIRECTORS
The members in the Annual General Meeting of the Company held on 30thSeptember 2014 had approved the appointments of Mr. Ramesh Chandra Agarwal (DIN: 00037477)and Mr. Satish Kumar Gupta (DIN: 00030841) as Independent Directors to hold office for 5consecutive years w.e.f. 30th September 2014 who are not liable to retire byrotation.
Pursuant to Section 134(3)(d) read with Section 149(7) of the Companies Act 2013 boththe Independent Directors have given declarations for the Financial Year 2017-18 that theymeet the criteria of independence as laid down under Section 149(6) the Act and Regulation16(1)(b) of Securities Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015.
The Company has a policy to induct its Independent Directors upon their appointment toattend the orientation programme conducted by the Company so as to familiarize them withthe Company's policies strategies plans etc.
Further the Board advises and ensures that its Independent Directors attend programmes/ seminars conducted by various organizations on the matters relating to financetaxation corporate governance etc. so that they keep themselves updated with the variousdevelopments in the corporate/ legal world.
iii) Changes in the composition of the Board of Directors / Key Managerial Personnel.
As required under the provisions of Section 134(q) read with Rule 8(5)(iii) of theCompanies (Accounts) Rules 2014 the details of Directors or Key Managerial Personnel whowere appointed or have resigned during the year under review are as follows:
> SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS
During the year under review no significant order has been passed by any regulators orcourts or tribunals.
> ADEQUACY OF INTERNAL FINANCIAL CONTROL
The Company maintains appropriate systems of internal control and monitoring proceduresto ensure that all assets are safeguarded against loss from unauthorized use ordisposition. It provides for adequate checks and balances and is meant to ensure that alltransactions are authorized recorded and reported correctly. The Internal financialcontrols with reference to the Financial Statements are adequate commensurate with thesize and nature of its business.
The Board had appointed M/s RBAS & Associates Chartered Accountants as InternalAuditor of the Company for the Financial Year 2016-17. The Internal Audit Report alongwith observations and recommendations contained therein was placed before the AuditCommittee in its meeting held on 25-5-2017 and was taken note of.
During the year under review your Company has not accepted any deposits from thepublic and as such no amount of principal or interest thereon was outstanding as on 31stMarch 2017.
> PARTICULARS OF EMPLOYEES
In terms of Section 197(12) read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 table containing the names and otherparticulars of employees is appended in ANNEXURE - IV.
Further in terms of Rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 no employee
a) employed throughout the financial year was in receipt of remuneration of Rs. 60 lakhor more or
b) employed for part of the year and was in receipt of Rs. 5 lakh or more per monthand
c) was in receipt of remuneration in excess of that drawn by the manager and holds byhimself / herself or along with his / her spouse and dependent children not less than twopercent of the equity shares of the company.
> CORPORATE SOCIAL RESPONSIBILITY
The provisions contained in Section 135 of the Companies Act 2013 read with theCompanies (Corporate Social Responsibility) Rules 2014 are not applicable to the Company.
> DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION& REDRESSAL) ACT 2013
During the year under review there was no case filed under the Sexual Harassment ofWomen at Workplace (Prevention Prohibition & Redressal) Act 2013.
> AUDITORS AND AUDITORS' REPORT
In terms of second proviso to Section 139(2) of the Companies Act 2013("Act") and rule 6(3) of the Companies (Audit and Auditors) Rules 2014 atransition period of three years from the commencement of the Act has been provided toappoint a new audit firm when the existing audit firm has completed two terms of fiveconsecutive years.
M/s Gupta Garg & Agrawal Chartered Accountants (Firm Regn No. 004330C) have beenassociated with the Company as Statutory Auditors for more than 10 years. Hence wouldretire at the conclusion of the ensuing 32nd Annual General Meeting (AGM) ofthe Company.
Accordingly pursuant to Section 139 142 and other applicable provisions of the Actif any read with the rules framed thereunder the Company is required to appoint a newAudit Firm in place of the retiring audit firm.
The Board of Directors in its meeting held on 25th May 2017 hasrecommended to appoint M/s. Goel Garg & Co. Chartered Accountants (Firm RegistrationNo. 000397N) as the Statutory Auditors of the Company for a term of 5 (five) yearscommencing from the conclusion of the ensuing 32nd AGM till the conclusion ofthe 37th AGM of the Company to be held in the calendar year 2022. The Companyhas received necessary written consent and confirmation from M/s. Goel Garg & Co.Chartered Accountants (Firm Registration No. 000397N) to the effect that theirappointment if made would be within the limits prescribed under Section 141 of the Actand rules framed thereunder and that they satisfy the eligibility criteria providedthereunder for the appointment as Statutory Auditors of the Company.
The Audit Report of M/s Gupta Garg & Agrawal Chartered Accountants (Firm Regn No.004330C) the retiring Statutory Auditors on the Financials Statements of the Company forthe financial year ended 31st March 2017 read with relevant Notes thereon areself-explanatory and do not call for any further explanation.
The Auditors' Report does not contain any qualification reservation or adverse remarkor disclaimer.
There was no fraud reported by Auditors under Section 143(12) of the Companies Act2013.
> DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134(3)(c) of the Companies Act 2013 withrespect to Directors' Responsibility Statement it is hereby confirmed that:
(a) in the preparation of the annual accounts for the Financial Year 2016-17 theapplicable accounting standards had been followed along with proper explanation relatingto material departures;
(b) the directors had selected such accounting policies and applied them consistentlyand made judgments 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 2017 and ofthe profit and 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 this Act for safeguarding theassets 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 thecompany and that such internal financial controls are adequate and were operatingeffectively; and
(f) the directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
> SECRETARIAL AUDIT REPORT
Pursuant to the provisions of Section 204 of the Companies Act 2013 read with Rule 9of the Companies (Appointment and Remuneration) Rules 2014 the Board had appointed M/s KRakesh & Co. Company Secretaries in Practice (C.P No 14700) to undertake theSecretarial Audit of the Company for the financial year 2016-17 and the report is annexedas ANNEXURE-V to this report.
> AUDIT COMMITTEE
The details pertaining to composition of Audit Committee and its terms of reference inaccordance with Sections 134(3) and 177(4) of the Act respectively are included in theCorporate Governance Report which forms part of this report.
There are no instances of the Board not accepting the recommendations of the AuditCommittee during the Financial Year 2016-17.
> NOMINATION AND REMUNERATION COMMITTEE
The details pertaining to composition of Nomination and Remuneration Committee and theCompany's policy on Directors Key Managerial Personnel and other Employees' appointmentand remuneration and other matters provided in Section 178(3) and (4) of the Act have beendisclosed in the Corporate Governance Report which forms part of this report.
> STAKEHOLDERS RELATIONSHIP COMMITTEE
The details pertaining to composition of Stakeholders Relationship Committee inaccordance with Section 178(5) of the Act are included in the Corporate Governance Reportwhich forms part of this report.
> BOARD EVALUATION
Pursuant to Section 134(q) of the Companies Act 2013 read with Rule 8(4) of theCompanies (Accounts) Rules 2014 and Regulation 17(10) of the Securities Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 the Board hascarried out a formal annual evaluation of its own performance performance of theIndividual Directors (including Independent Directors) as well as the evaluation of theworking of its Committees.
The Nomination and Remuneration Committee has in terms of Section 178(2) and (3) of theCompanies Act 2013 and relevant regulations of the Securities Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 defined theevaluation criteria procedure and time schedule for the Performance Evaluation processfor the Board its Committees and Directors. The nomination and remuneration policy interalia giving details
about the policy on directors' appointment and remuneration including the criteria fordetermining qualifications positive attributes independence and other details areincluded in nomination and remuneration policy the details of which are given in theCorporate Governance Report which forms part of this Report.
> CORPORATE GOVERNANCE & COMPLIANCE CERTIFICATE
The Company is committed to follow the standards of good Corporate Governance. Asrequired under Regulation 34(3) read with Schedule V of the Securities Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 a detailedreport on Corporate Governance is annexed as ANNEXURE - VI(a) and forms integral part ofthis report.
Further the Company has received a certificate from M/s K Rakesh & Co CompanySecretaries in Practice (C.P. No. 14700) regarding compliance with Corporate Governancenorms as stipulated in Part C of Schedule V of the Listing Regulations for the financialyear ended 31st March 2017. The certificate confirming compliance of theconditions of Corporate Governance is annexed as ANNEXURE - VI(b) and form integral partof this report.
> MANAGEMENT DISCUSSION AND ANALYSIS REPORT
As required under Schedule V(B) of the Securities Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 the Management Discussion andAnalysis Report is presented in the separate section and is marked as ANNEXURE - VII andforms an integral part of this report.
> VIGIL MECHANISM/ WHISTLE BLOWER POLICY
Pursuant to Section 177(9) and (10) of the Companies Act 2013 read with Rule 7 of theCompanies (Meetings of Board and its powers) Rules 2014 and Schedule V(B) of theSecurities Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 the Company has established a Vigil Mechanism to report genuineconcerns about actual or suspected frauds unethical behavior etc. and the same has beenposted on the official website of the Company.
> LISTING AT STOCK EXCHANGE(s)
The Company continues to be listed at the Bombay Stock Exchange Ltd and Calcutta StockExchange Association Ltd.
Your Directors wish to place on record their sincere thanks and appreciation for thecooperation and help provided by State Government and the Bankers to the Company.
Your Directors also acknowledge the continued trust and confidence that Shareholdershave placed in the Company.
By Order of the Board
For AVON MERCANTILE LIMITED