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Decillion Finance Ltd.

BSE: 539190 Sector: Financials
NSE: N.A. ISIN Code: INE848N01017
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Decillion Finance Ltd. (DECILLIONFIN) - Director Report

Company director report

FOR THE FINANCIAL YEAR 2015-2016

To

The Members

Your directors have pleasure in presenting their Twenty-Second Annual Report on thebusiness and opera ons of Decillion Finance Limited (the "Company") togetherwith the audited statement of accounts for the year ended 31st March 2016.

FINANCIAL HIGHLIGHTS (STANDALONE AND CONSOLIDATED)

During the year under review performance of your company as under:

(Amount in Rs.)
Par culars Year Ended 31.03.2016 Year Ended 31.03.2015
Revenue 9431744 10488991
Less: Expenditure 7672402 9950293
Profi t/(Loss) before taxa on 1759342 538697
Less: Tax Expense 356801 161967
Profi t a er tax 1402541 376730
Transfer to Special Reserve 280508 75346
Transfer to Contingent Provisions against Standard Assets (57347) (25557)
Balance brought forward from Previous year (379892) (655720)
Balance transferred to Balance Sheet 684794 (379892)

The consolidated performance of the group as per consolidated financial statements isas under:

(Amount in Rs.)
Par culars Year Ended 31.03.2016 Year Ended 31.03.2015
Revenue 9483288 10634146
Less: Expenditure 7716692 10079835
Profi t/(Loss) before taxa on 1766596 554311
Less: Tax Expense 362135 176272
Profi t a er tax 1404461 378039
Share of Profi t / (Loss) transferred to Minority Interest (10) 201
Balance Profi t / (Loss) C/F to the next year 701114 (340673)

OPERATING & FINANCIAL PERFORMANCE

Gross revenues decreased to ` 9431744 a decline of around 10.08% against `10488991 in the previous year. Profit before taxa on was ` 1759342 against Rs. 538697in the previous year. The percentage of profit has increased by 226.59% due to decrease inChanges in stock in trade.

DIVIDEND

With the view to conserve the resources of Company the Directors are not recommendingany dividend.

CHANGES IN SHARE CAPITAL

During the Financial Year 2015-16 there has been no change in the share capital of theCompany. The Share Capital of the company is ` 35000000 divided into 3500000 Equityshares of `10 each.

EXTRACT OF ANNUAL RETURN

The extract of Annual Return in format MGT -9 for the Financial Year 2015-16 has beenenclosed with this report as

Annexure I.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with the provisions of Companies Act 2013 Mr. Mahesh Kumar Bhalo a (DIN:00280743) Director of the Company re res by rota on and being eligible o ers himself forre-appointment.

Mr. Mahesh Kumar Kejriwal (DIN: 07382906) was appointed as an Addi onal Independent NonExecurive Director of the Company on 30th April 2016 to hold o ce upto the date ofensuing Annual General Meeting. Your Company has received no ces from shareholders alongwith requisite deposits proposing the candidature of. Mr. Mahesh Kumar Kejriwal forappointment as Independant Director at the ensuing Annual General Meeting.

Mr. Ashish Jalan has resigned from the post of Directorship w.e.f 1st January 2016

Ms. Bhara Ranga has resigned from the Board w.e.f 5th February 2016.

Mr. Nikunj Kanodia has regined from the Board w.e.f 18th April 2016

Mr. Prabhat Kumar Marda Cheif Financial O cer resigned w.e.f 01.03.2016. On recommendaon of the nomina on and remunera on commi ee Mr. Rajesh Kumar Yadav was appointed as theCheif Financial O cer and Key Managerial Personnel under sec on 203 of the Companies Act2013 of the Company with e ect from 2nd March 2016. Mr. Jitendra Kumar Goyal Director wasappointed as the Managing Director of the Company for a period of 2 years on recommenda onof the Nomina on and Remmunera on commi ee with e ect from 9th February 2016. PoonamDalmiya was the Company Secretary Compliance o cer and Key managerial personnel of theCompany as on 31.03.2016. Futher Ms. Poonam Dalmiya resigned on 23rd April 2016 and Mr.Jitendra Kumar Goyal being recommended by Nomina on & Remunera on Commi ee andappointed by the board as Managing Director and the Compliance O cer of the Company w.e.f30th May 2016.

As no 31.03.2016 the list of KMP are :a) Mr. Jitendra Kumar Goyal - ManagingDirector b) Mr. Rajesh Kumar Yadav - CFO c) Miss Poonam Dalmia - CompanySecretary

DECLARATION BY INDEPENDENT DIRECTOR(S)

The Board of Directors hereby cer fies that the Independent Directors appointed on theBoard meet the criteria pursuant to Sec on 149(6) of the Companies Act 2013.

Further all Independent Directors have furnished their Declara ons meeting thecriteria under Sec on 149(6) of the Companies Act 2013 and Regula on 25 SEBI (ListingObliga ons and Disclosure Requirement) Regula ons 2015.

NUMBER OF BOARD MEETINGS

During the Financial Year 2015-16 eight (08) meetings of the Board of Directors of theCompany four(4) Audit Commi ee Meetings and(01) Stakeholders Rela onship Commi ee Meetingwere held. The details of which are given in the Corporate Governance Report. Theintervening gap between the Meetings was within the period prescribed under the CompaniesAct 2013.

BOARD INDUCTION TRAINING AND FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

At the me of appointment of the Director a formal le er of appointment is given to himwhich inter-alia explains the role func ons and responsibili es expected of him as aDirector of the Company. The Director is also explained in detail the various compliancesrequired from him as a Director under the various provisions of the Companies Act 2013Regula on 25 SEBI(Listing Obliga ons and Disclosure Requirement) Regula ons 2015SEBI(Prohibi on of Insider Trading) Regula ons 2011 the Code of Conduct of the Companyand other relevant regula ons.

The Director upon appointment is formally inducted to the Board. In order tofamiliarize the Independent Directors about the business drivers they are updated throughpresenta ons at Board Meetings about the Financials of the company and also about the newproduct launches. They are also provided booklets about the business and opera ons of thecompany.

The Directors are also updated on the changes in relevant corporate laws relating totheir roles and responsibili es as Directors. The details of the Board Familiariza onprogramme for the Independent Directors can be accessed in the website of the Company viz;www.decillion.co.in .

BOARD EVALUATION

Pursuant to the provisions of Companies Act 2013 and Regula on 17 SEBI(Listing Obligaons and Disclosure Requirement) Regula ons 2015 the Board has carried out annualperformance evalua on of its own performance the Individual Directors and there Commiees.

REMUNERATION POLICY

The Board has on the recommenda on of the Nomina on & Remunera on Commi ee frameda policy for selec on and appointment of Directors Senior Management and their remuneraon. The Company’s Remunera on Policy is available on the Company's website atwww.decillion.co.in and also forms part of Directors Report as Annexure II.

COMMITTEES OF THE BOARD

Currently the Board has three commi ees: the Audit Commi ee Nomina on and Remunera onCommi ee and Stakeholders’ Rela onship Commi ee. All commi ees consist of requisitenumber of independent directors.

PARTICULARS OF LOAN GUARANTEES AND INVESTMENTS UNDER SECTION 186

The Company has not given any loans or guarantees covered under the provisions of secon 186 of the Companies Act 2013 as it is exempted from the applicability of theprovision of Sec on 186 of the Companies Act 2013 read with Rule 11 of the Companies(Meeting of Board and its Powers) Amendment Rules 2015 as your Company is NBFC registeredwith RBI whose principal business inter alia includes financing of companies.

The details of the investments made by the Company are given in the notes to thefinancial statements.

RELATED PARTY TRANSACTIONS

All Related party transac ons that were entered into during the financial year were onan arms length basis and in the ordinary course of business. There are no materialsignificant related party transac ons made by the Company during the year that would haverequired shareholder approval under Clause 49 of the Listing Agreement. All related partytransac ons are reported to the Audit Commi ee. Prior approval of the Audit Commi ee isobtained on a yearly basis for the transac ons which are planned and/ or repe ve in natureand omnibus approvals are taken within limits laid down for unforeseen transac ons. Thedisclosure under Sec on 134(3)(h) of the Companies Act 2013 read with Rule 8(2) of theCompanies (Accounts) Rules 2014 is not applicable. The Policy on Related Party transacons as approved by the Board has been uploaded on the Company’s Website and may beaccessed at the link h p://decillion.co.in/related-party-policy.

The details of the transac ons with related par es during 2015-16 are provided in theaccompanying financial statements.

None of the Independent Directors had any pecuniary rela onship or transac ons with theCompany during the year under review.

LISTING AGREEMENT

The Securi es and Exchange Board of India (SEBI) on September 2 2015 issued SEBI(Listing Obliga ons and Disclosure Requirements) Regula ons 2015 with the aim toconsolidate and streamline the provisions of the Listing Agreement for di erent segmentsof Capital markets to ensure be er enforceability. The said regula ons were effective fromDecember 1 2015. Accordingly all listed en es were required to enter into the ListingAgreement within Six Months from the Effective date. The Company entered into new ListingAgreement with CSE Ltd during.the financial year.

STATUTORY AUDITOR

M/s. S. K. Rungta & Co. Chartered Accountants (FRN: 308081E) Kolkata wereappointed as Statutory Auditors of the Company from the conclusion of the Annual GeneralMeeting held on 30.09.2014 un l the conclusion of 23rd Annual General Meeting to be heldin the year 2017. Their appointment is to be ra fied by the shareholders under Sec on 139of the Companies Act 2013 at the ensuing Annual General Meeting.

The Statutory Auditor’s Report does not contain any qualifica on reserva on oradverse remark. The Auditor’s Report is enclosed with the financial statements inthis Annual Report.

AUDITOR’S CERTIFICATE ON CORPORATE GOVERNANCE

As required by SEBI(Listing Obliga ons and Disclosure Requirements) Regula on 2015the auditor’s cer ficate on corporate governance is enclosed as Annexure V tothe Board’s report. The auditor’s cer ficate for fiscal 2016 does not containany qualifica on reserva on or adverse remark.

SECRETARIAL AUDITOR

Mr. Anand Khandelia Prac cing Company Secretary was appointed to conduct thesecretarial audit of the Company for the financial year 2015-16 as required under Sec on204 of the Companies Act 2013 and Rules thereunder. The Secretarial Audit Report forFinancial Year 2015-16 form a part of the Directors Report and is a ached here as AnnexureIII.

The Report confirms that the Company had complied with the statutory provision listedunder Form MR-3 and the Company also has proper board processes and compliance mechanism.The Secretarial Audit Report does not contain any qualifica on reserva on or adverseremark.

EXPLANATION TO AUDITOR’S REMARKS

The Auditors’ Report by the Statutory Auditors and by the Secretarial Auditor inthe Secretarial Audit Report being self-explanatory does not call for any furthercomments by the Board of Directors.

MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE COMPANY

No material changes and commitments have occurred from the date of close of thefinancial year ll the date of this Report which a ect the financial posi on of theCompany.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System commensurate with the size scale andcomplexity of its opera ons. The scope and authority of the Internal Audit func on isdefined in the Internal Audit Manual. To maintain its objec vity and independence theInternal Audit func on reports to the Chairman of the Audit Commi ee of the Board & tothe Director.

CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTION

Since the Company does not own any manufacturing facility being an Investment Companythe par culars relating to conserva on of energy and technology absorp on s pulated in theCompanies (Accounts) Rules 2014 are not applicable.

FOREIGN EXCHANGE EARNINGS & OUTGO

There is no foreign exchange earnings and outgo during the year under review.

DETAILS OF SUBSIDIARY

As on March 31 2016 the Company had two Indian subsidiaries. During the year underreview Aurelian Trading Private Limited Centuple Commerical Limited and GoldmoonCommotrade Limited ceased to be subsidiary during the year. In compliance with AccountingStandard 21 your Company has prepared its consolidated financial statements which formspart of this annual report. Pursuant to the provision of sec on 129(3) of the CompaniesAct 2013 a separate statement containing the salient features of the subsidiarycompanies in the prescribed form AOC-1 (Annexure – IV) is a part of theconsolidated financial statement. The accounts of the subsidiary companies will beavailable to any member seeking such informa on at any point of me. The financialstatement of the Company along with the accounts of the subsidiaries will be available atthe website of the Company namely www.decillion.co.in and kept open for inspec on at theregistered o ce of the Company.

The Policy for determining material subsidiaries as approved may be accessed on theCompany's website at the www.decillion. co.in.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has established a vigil mechanism for Directors and employees to reporttheir genuine concerns details of which is available on the Company's websitewww.decillion.co.in

MANAGEMENT’S DISCUSSION AND ANALYSIS REPORT

The Management’s Discussion and Analysis Report for the year under review as spulated under Regula on 34 SEBI (Listing Obliga ons and Disclosure Requirement) Regulaons 2015 is annexed to this report.

STATUTORY & LEGAL MATTERS

There has been no significant and/or material order(s) passed by anyRegulators/Courts/Tribunals impacting the going concern status and the Company’sopera ons in future.

CORPORATE GOVERNANCE

The Company is commi ed to maintaining the highest standards of Corporate Governanceand adhering to the Corporate Governance requirements as set out by Securi es and ExchangeBoard of India. The Report on Corporate Governance as s pulated in SEBI (Listing Obligaons and Disclosure Requirement) Regula ons forms part of the Annual Report and annexed asAnnexure V.

CODE OF CONDUCT

The Board of Directors has approved a Code of Conduct which is applicable to theMembers of the Board and all employees in the course of day to day business opera ons ofthe company. The code laid down by the Board is known as "code of businessconduct" which forms an Appendix to the Code. The Code has been posted on theCompany’s website www.decillion.co.in.

All the Board Members the Senior Management personnel and personnel one level belowthe Board have confirmed compliance with the Code. All Management Sta were givenappropriate training in this regard.

DEPOSITS

The Company being a non-banking financial Company has not accepted any public depositsand as such no amount on account of principal or interest on public deposits wasoutstanding as on the date of the balance sheet.

MANAGERIAL REMUNERATION

The informa on required pursuant to Sec on 197(12) read with Rule 5(1) of The Companies(Appointment and Remunera on of Managerial Personnel) Rules 2014 in respect of employeesof the Company is a ached here as Annexure VII and forms a part of theDirectors’ Report.

There are no employees who are in receipt of remunera on in excess of the limitspecified under sec on 134(3) (q) read with Rule 5 (2) and 5 (3) of the Companies(Appointment and Remunera on of Managerial Personnel) Rules 2014.

CORPORATE SOCIAL RESPONSIBILITY

The Net worth of the Company was below ` 500 Crore the Turnover of the company wasbelow ` 1000 Crore and the Net Profit of the Company was below ` 5 crore in any of thepreceding three financial year hence provisions of sec on 135(1) of the Companies Act2013 read with CSR rules 2014 issued in this behalf are not a racted on the Company.

DIRECTOR'S RESPONSIBILITY STATEMENT

The Board of Directors acknowledges the responsibility for ensuring compliance with theprovisions of sec on 134(3)(c) read with sec on 134(5) of the Companies Act 2013 andClause 49(III)(D)(4)(a) of the listing agreement with Stock Exchanges in the prepara on ofthe annual accounts for the year ended on 31.03.2016 and state that : (i) in the preparaon of the annual accounts the applicable accounting standards have been followed alongwith proper explana on relating to material departures if any; (ii) the Directors haveselected such accounting policies and applied them consistently and made judgments and esmates that are reasonable and prudent so as to give a true and fair view of the state of aairs of the Company at the end of the financial year and of the profit of the Company forthat period; (iii) the Directors have taken proper and su cient care for the maintenanceof adequate accounting records in accordance with the provisions of this Act forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregulari es; (iv) the Directors have prepared the annual accounts on a going concernbasis; (v) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and (vi) There is a proper system to ensure compliance with the provisions ofall applicable laws and that such systems are adequate and operating effectively.

DECILLION

RBI GUIDELINES FOR NON-BANKING FINANCIAL COMPANIES

The Company has observed all the pruden al norms prescribed by the Reserve Bank ofIndia. The Schedule as required in terms of Paragraph 13 of Non-Banking FinancialCompanies Pruden al Norms (Reserve Bank) Direc ons 2015 is annexed herewith.

PROHIBITION OF INSIDER TRADING

The Company has a policy prohibiting Insider Trading in conformity with applicableregula ons of the SEBI in India and the Securi es and Exchange Commission (SEC) in theUSA. Necessary procedures have been laid down for Directors o cers and employees fortrading in the securi es of the Company. The policy procedures and their obliga ons areperiodically communicated to the employees who are considered as insiders of the Company.Trading window closure/blackout/ quiet periods when the Directors and employees are notpermi ed to trade in the securi es of the Company are in mated to all Directors andemployees in advance whenever required.

PROVISIONS OF SEXUAL HARASSMENT

The provisions of the Sexual Harassment of Women at the work place (Preven on Prohibion and Redressal) Act 2013 is not a racted on the Company However the Company has avoluntary policy towards Preven on of Sexual Harassment of Women employees of the Companyand has set up a mechanism for registering and prompt redressal of complaints receivedfrom all permanent and temporary employees and sta s.

CAUTIONERY NOTE

The statements forming part of the Directors’ Report may contain certain forwardlooking remarks within the meaning of applicable securi es laws and regula ons. Manyfactors could cause the actual results performances or achievements of the Company to bematerially di erent from any future results performances or achievements that may beexpressed or implied by such forward looking statements.

ACKNOWLEDGMENT

Your Company and its Directors wish to extend their sincerest thanks to the Members ofthe Company Bankers State Government the Ministry of Corporate A airs the Reserve Bankof India Local Bodies Execurives Sta and others at all levels for their con nuoussupport coopera on assistance and look forward to their con nued support in the future.Our consistent growth was made possible by their hard work solidarity coopera on andsupport. The Board expects to receive their con nuous support in future also.

By Order of the Board of Directors
For Decillion Finance Limited
Mahesh Kumar Bhalo a Jitendra Kumar Goyal
Place: Kolkata Director Managing Director
Date: 30.05.2016 (DIN : 00280743) (DIN : 00468744)