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Gemstone Investments Ltd.

BSE: 531137 Sector: Financials
NSE: N.A. ISIN Code: INE503D01027
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OPEN 0.75
PREVIOUS CLOSE 0.78
VOLUME 50000
52-Week high 0.82
52-Week low 0.32
P/E 18.75
Mkt Cap.(Rs cr) 6
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.78
Sell Qty 100.00
OPEN 0.75
CLOSE 0.78
VOLUME 50000
52-Week high 0.82
52-Week low 0.32
P/E 18.75
Mkt Cap.(Rs cr) 6
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.78
Sell Qty 100.00

Gemstone Investments Ltd. (GEMSTONEINVEST) - Director Report

Company director report

To the members

The directors are pleased to present this 21stAnnual R eport of the Companyalong with the audited financial statements for the financial year ended 31stMarch2015.

Financial Results:

The performance of the Company for the Financial Year ended March 31 2015 issummarized as below:

Particulars FY 2014-15 FY 2013-14
Income from Operations 23223874.00 10892635.00
Other Revenue 7482.00
Total Revenue 23223874.00 10900117.00
Employee benefits expense 2760635.00 1990487.00
Finance costs 1160811.46 1216532.01
Depreciation and amortization expense 125127.00 128100.00
Other expenses 12997287.00 4809268.22
Total Expenses 17043860.46 8144387.23
Profit before Exceptional Items and Tax 6180013.54 2755729.77
Exceptional Items
Profit Before Tax 6180013.54 2755729.77
Current Year Tax 2062921.00 904647.00
Deferred Tax (1038.00) 4609.00
Profit After Tax 4118130.54 1846473.77
Profit for the Year 4118130.54 1846473.77
Balance brought forward 6917146.83 5070673.06
Balance carried forward 11035277.37 6917146.83

Gross Income increased from 10900117/- in the FY 2013-14 to 23223874/- in FY 2014-15 recording an increase by 12323757. The Profit after Tax also increased to Rs.4118130.54/- in FY 2014-15 as against Rs. 1846473.77/- in the FY 2013-14.

Operations:

The operations of the Company are more elaborated in the annexed ‘ManagementDiscussion and Analysis Report’ which also forms a part of Annual Report.

Share Capital:

The Authorized Share Capital of the company was Rs. 100000000/- and the Paid-upEquity Share Capital of the Company as on March 31 2015 was Rs. 74750000. There was nopublic issue rights issue bonus issue or preferential issue etc. during the year. TheCompany has not issued shares with differential voting rights sweat equity shares nor hasit granted any stock options. Thus there was no change in the Authorized or Paid-upCapital or Subscribed Capital during the Financial Year 2014-15.

Dividend:

The Company is in the stage of expansion and thus in order to conserve the resourcesof the Company the Management has not recommended payment of any dividend on the EquityShares for the current FY 2014-15.

Transfer to Reserves:

The Company has not transferred any amount to Reserves in the Financial Year 2014-15.

Subsidiaries and Associates:

Subsidiary / Joint Ventures:The Company does not have any Subsidiary or JointVentures.

Associate Company: The Company holds 24.00% shares in the company Asian FintradeServices Pvt. Ltd. Thus Asian Fintrade Services Pvt. Ltd is an Associate Company as permeaning of Section 2(6) of the Companies Act 2013 ("Act"). In terms of Section129 of the Companies Act 2013 read with third proviso to Rule 5 of Companies (Accounts)Rules 2014 the statement containing the salient feature of the financial statement ofAssociate Company in form AOC-1 is enclosed as "Annexure A"which formspart of this report.

Directors:

Appointment:

1. Pursuant to the provisions of Section 149 of the Act which came into effectfrom April

1 2014 Mr. Hitesh Dave Mr. Mahendra Dave and Mrs. Shikha Kapasi were appointed asindependent directors at the annual general meeting of the Company held on September 30th2014. The terms and conditions of appointment of independent directors are as per ScheduleIV of the Act. They have submitted a declaration that each of them meets the criteria ofindependence as provided in Section 149(6) of the Act and there has been no change in thecircumstances which may affect their status as independent director during the year.

2. Mr. Devendrakumar Shah was appointed as a Non-Executive director and Mr.Muljibhai Chheda as an Executive Director liable to retire by rotation at the meeting heldon 30thSeptember 2014 in terms of Section 152 & 160 of the Act.

3. The Company has received notice together with requisite deposit of Rs. 1 Lacunder Section 160 of the Companies Act 2013 from the members of the Company proposingthe candidature of Mr. Dharmesh Belani and Mrs. Mamata Shetty as a Non ExecutiveIndependent Director for a term of five years. Their appointment has been proposed in theAnnual General Meeting and a resolution for their appointment forms part of the noticeconvening the said Annual General Meeting.

Re-appointment: In accordance with the provisions of the Companies Act 2013 Mr.Muljibhai Chedda and Mr. Nimesh Ganatra Director of the Company being the longest in theoffice amongst the four directors liable to retire by rotation retires from the Board byrotation this year and being eligible has offered their candidature forre–appointment. Necessary resolution for this purpose is being proposed in the noticeof the ensuing Annual General Meeting for the approval of the members. None of theIndependent Directors are due for reappointment.

Key Managerial Personnel:

During the year under review Mr. Anant Palan Managing Director and Mr. Rohan BarotChief Financial Officer (appointed w.e.f 14th November 2014) were designatedas Key Managerial Personnel of the Company pursuant to Section 203 of the Companies Act2013.

Declaration by Independent Directors:

The independent directors have submitted the Declaration of Independence as requiredpursuant to section 149 (7) of the Companies Act 2013 stating that they meet the criteriaof independence as provided in sub-section (6).

Policy on Directors’ Appointment and Remuneration:

The Nomination & Remuneration Committee constituted in accordance with the Section178 of Companies Act & Revised Clause 49 of Listing Agreement formulates the policyfor appointment removal and remuneration of Directors. The Directors of the Company areappointed by shareholders at the General Meetings. As regards the appointment and tenureof Independent Directors the Company has adopted the provisions of the Companies Act2013 read with Clause 49 of the Listing Agreement.

The Company’s Remuneration Policy for Directors Key Managerial Personnel andSenior Management is enclosed as "Annexure B"to this Report.

Performance Evaluation of the Board:

Pursuant to Clause 49 of the Listing Agreement the Companies Act 2013 and ScheduleIV of the Companies Act 2013 the evaluation of the Board as a whole and all directorswas conducted based on identified criteria and framework.

The performance evaluation of the Chairman Managing Director and the Non-IndependentDirectors was carried out by the Independent Directors and the performance evaluation ofthe Independent Directors was carried out by the entire Board excluding the director beingevaluated. The Board has carried out an annual performance of the directors individuallyas well as the evaluation of the working of its Audit Nomination & RemunerationStakeholders Relationship & Risk Management Committees.

Directors’ Responsibility Statement:

Pursuant to Section 134(5) of the Companies Act 2013 the board of directors to thebest of their knowledge and ability confirm that:

• In the preparation of the annual accounts the applicable accounting standardshave been followed and there are no material departures;

They have 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 at the end of the financial year and ofthe profit of the Company for that period;

They have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

They have prepared the annual accounts on a going concern basis;

They have laid down internal financial controls to be followed by theCompany and such internal financial controls are adequate and operating effectively;

They have devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

Board Meetings:

Five meetings of the board were held during the year. Details of the meetings of theboard are included in the Corporate Governance Report which forms a part of this report.

Audit Committee:

The Audit Committee comprises of 4 Directors All the recommendations made by the AuditCommittee were accepted by the Board. Further Details pertaining to Audit committee areincluded in the Corporate Governance Report which forms part of this report.

Auditors:

• Statutory Auditors: Pursuant to the provisions of Section 1 39 of the Actand the rules framed the Statutory Auditors of the Company M/s. N R Gala &Associates were appointed on 29.09.2014 for a term of three years subject toratification at every Annual General Meeting. Necessary resolutions for the ratificationby members have been put across in the notice which forms a part of this report. Theauditors’ report for the financial year 2014-15 does not contain any qualificationsreservations or adverse remarks.

• Secretarial Auditor: Pursuant to Section 204 of the Act and rules framedtherein the Board of Directors had appointed M/s. Mayank Arora & Co. thePracticing Company Secretary Firm as a Secretarial Auditor on the recommendation of theAudit committee to conduct Secretarial Audit for the financial year 2014-15. Their reportof the Secretarial Audit is given as an "Annexure C" which forms part ofthis report.

• Internal Auditor: The Board on recommendation of the Audit Committee hadappointed M/s.Tejas Nadkarni & Associates as the Internal Auditors.

Risk Management

The Board of the Company has formed a risk management committee to frame implement andmonitor the risk management plan for the Company. The committee is responsible forreviewing the risk management plan and ensuring its effectiveness. The broad terms ofreference of the Committee are stated in the Corporate Governance Report. The auditcommittee has additional oversight in the area of financial risks and controls. Majorrisks identified by the businesses and functions are systematically addressed throughmitigating actions on a continuing basis.

Deposits:

The Company did not hold any public deposits at the beginning of the year nor has itaccepted any public deposits during the year under review.

Particulars of Loans Guarantees and Investments:

The Company being a non-banking finance company registered with the Reserve Bank ofIndia and engaged in the business of giving loans is exempt from complying with theprescribed limits as specified under the provisions of section 186 of the Companies Act2013. The details of investments made are given in Notes to the Financial Statements whichforms a part of this Report.

Particulars of Contracts or Arrangements Made With Related Parties:

None of the transactions with related parties falls under the scope of Section 188(1)of the Act. Information on transactions with related parties pursuant to Section 134(3)(h)of the Act read with rule 8(2) of the Companies (Accounts) Rules 2014 are given in "AnnexureD" in Form AOC-2 and the same forms part of this report.

Conservation of Energy and Technology Absorption:

The Company being a non–banking finance company (NBFC) does not have anymanufacturing activity. The information required under Section 134(3)(m) of the CompaniesAct 2013 read with the Companies (Accounts) Rules 2014 with respect to conservation ofenergy technology absorption and foreign exchange earnings/outgo is appended hereto as "AnnexureE" and it forms part of this Report.

Corporate Social Responsibility:

The conditions as prescribed under the section 135 of the Companies Act 2013requiring a Company to constitute a Corporate Social Responsibility Committee is notapplicable to the Company. The Board of Directors also periodically reviews theapplicability of CSR rules to the Company so as to take necessary steps for constitutionof Committee if required.

Extract of annual return:

As provided under Section 92(3) of the Act the extract of annual return is enclosed as"Annexure F"in the prescribed Form MGT -9 which forms part of thisreport.

RBI Guidelines:

The Company is a non-deposit accepting NBFC registered with the Reserve Bank of India.The Company provided all required information to the RBI for the financial year under thereview. The Company continues to fulfill all the norms and standards as laid down by theReserve Bank ofIndia.

Management Discussion and Analysis:

Pursuant to clause 49 of the Listing Agreement entered into with the Stock Exchanges"Management Discussion andAnalysis" is given separately forming part of thisReport.

Corporate Governance:

The Company has complied with all the mandatory requirements of Corporate Governancespecified by the Securities & Exchange Board of India through clause 49 of the ListingAgreement. As required by the said clause a separate "Report on CorporateGovernance" forms part of the Annual Report of the Company. A certificate from theStatutory Auditors of the Company regarding compliance with the conditions of CorporateGovernance also forms part of this Report.

Regulatory Actions:

There are no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and operations of the Company in future.

Internal Financial Control Systems:

The Company’s internal control system is designed to ensure operationalefficiency protection and conservation of resources accuracy and promptness in financialreporting and compliance with laws and regulations. The internal control system issupported by an internal audit process for reviewing the adequacy and efficacy of theCompany’s internal controls including its systems and processes and compliance withregulations and procedures. Internal Audit Reports are discussed with the Management andare reviewed by the Audit Committee of the Board which also reviews the adequacy andeffectiveness of the internal controls in the Company.

The Company’s internal control system is commensurate with the size nature andoperations of the Company. The Company has a process in place to continuously monitor theexisting controls and identify gaps if any and implement new or improved controls.

Human Resources:

The Company recognizes people as its most valuable asset and has built an opentransparent and meritocratic culture to nurture this asset. Therefore adoptsfriendly humanresource (HR) policies to motivate its employees and create a congenial work environment.Merit based recruitment adequate training facilities rewards and recognitions are someof the components of its HR policies. Such policies help in skill enhancement knowledgeupgradation and employee motivation which in turn contribute to organizationalexcellence.

Particulars of Employees:

During the year ended March 31 2015 no employee is drawing remuneration in excess ofthe amount prescribed under Section 197 of the Companies Act 2013 read with Rule 5(1) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.

Sexual Harassment at Workplace:

The Company has formulated a policy for prevention and deterrence of acts of sexualharassment. The Policy also defines the procedures for the resolution and settlement ofcomplaints if any. This policy ensures implementation and compliance with therequirements under the law. There were no such complaints received on sexual harassment sofar.

Vigil Mechanism / Whistle Blower Policy:

The Company has formulated a Whistle Blower Policy to provide Vigil Mechanism foremployees including directors of the Company to report genuine concerns. The provisions ofthis policy are in line with the provisions of the Section 177(9) of the Act and therevised Clause 49 of the Listing Agreements with stock exchanges The Policy ensures thatstrict confidentiality is maintained whilst dealing with concerns and also that nodiscrimination will be meted out to any person for a genuinely raised concern.

Disclosures:

There has been no change in the nature of business of the Company during theyear under review.

There are no material changes and commitments affecting the financialposition of the Company which have occurred between the end of financial year and the dateof this Report.

There Company did not issue any equity shares with differential rights as todividend voting or otherwise.

The Managing Director of the Company does not receive any remuneration orcommission from any of its subsidiaries.

Acknowledgement:

Your Directors wish to convey their gratitude and appreciation to all the employees ofthe Company for their valuable contribution during the year through their dedication hardwork and commitment and the trust and confidence reposed on us. They also wish to place onrecord their appreciation of the Company’s customers shareholders investorsbankers agents suppliers distributors and other business associates for theircooperation and support. Your Directors especially appreciate the continued understandingand confidence of t he Members.

For and on behalf of the Board
Sd/-
Place: Mumbai Mahendra Dave
Date: 5thSept ember 2015. Chairman & Director

FORM AOC- 1

[Pursuant to first proviso to sub-section (3) of Section 129 read with rule 5 of theCompanies (Accounts) Rules 2014]

Statement containing salient features of the financial statement ofSubsidiaries/Associate Companies/Joint Ventures

Part "A": Subsidiaries

Particulars Details
1 Name of the subsidiary
2 Reporting period for the subsidiary concerned if different from the holding company’s reporting period
3 Reporting currency and Exchange rate as on the last date of the relevant Financial year in the case of foreign subsidiaries.
4 Share capital The Company does not have any subsidiaries thus Part A of the form is not applicable to the Company.
5 Reserves & surplus
6 Total assets
7 Total Liabilities
8 Investments
9 Turnover
10 Profit before taxation
11 Provision for taxation
12 Profit after taxation
13 Proposed Dividend
14 % of shareholding

Notes: the following information shall be furnished at the end of thestatement:

1. Names of subsidiaries which are yet to commence operations:None

2. Names of subsidiaries which have been liquidated or sold during the year:None

Part "B": Associate/Joint Venture

(Statement pursuant to section 129(3) of the Companies Act 2013 related to AssociateCompanies and Joint Ventures)

Particulars Details
1 Name of Associate/Joint Ventures Asian Fintrade Services Pvt. Ltd.
2 Latest Audited Balance Sheet Date 31.03.2014
3 Shares of Associate/Joint Ventures held by the Company on the year end
No. of shares 240000
Amount of investment in Associate/Joint Venture 2400000 Rs.
Extent of Holding % 24.00%
4 Description of how there is significant influence Common Director (Nimesh Ganatra) and the company have 24.00% of the shareholdings in the company.
5 Reason why the associate/joint venture is not consolidated Not Applicable as per the Notification no. GSR-E dated 14th October 2014.
6 Net worth attributable to shareholding as per latest audited Balance Sheet 2507338
7 Profit/Loss for the year
i. Considered in consolidation Nil
ii. Not Considered in Consolidation 22673

1. Names of associates or joint ventures which are yet to commence operations: None

2. Names of associates or joint ventures which have been liquidated or soldduring the year:

None

For and on behalf of the Board
Sd/-
Place: Mumbai Mahendra Dave
Date: 5thSeptem ber 2015. Chairman & Director

ANNEXURE B

NOMINATION AND REMUNERATION POLICY

Purpose

The Board of Directors in order to align with the provisions of the Section 178 of theCompanies Act 2013 and Clause 49 of the Listing Agreement renamed the "RemunerationCommittee" as "Nomination and Remuneration Committee". This policy onnomination and remuneration of Directors Key Managerial Personnel and Senior ManagementPersonnel (SMP) has been formulated by the Nomination and Remuneration Committee and hasbeen approved by the Board of Directors of the Company. This policy shall act as aguideline for determining inter alia qualifications independence of a Director mattersrelating to the remuneration appointment removal and evaluation of performance of theDirectors Key Managerial Personnel Senior Management and other employees.

Applicability

This Policy is applicable to:

1. Directors viz. Executive Non-executive and Independent

2. Key Managerial Personnel

3. Senior Management Personnel

4. Other Employees of the Company as applicable.

Objective

The objective of this policy is to lay down a framework in relation to remuneration ofdirectors KMP senior management personnel and other employees. The Key Objectives of thepolicy is:

To guide the Board in relation to appointment and removal of Directors KeyManagerial Personnel and Senior Management.

To evaluate the performance of the members of the Board and providenecessary report to the Board for further evaluation of the Board.

To recommend to the Board on Remuneration payable to the Directors KeyManagerial Personnel and Senior Management.

To provide to Key Managerial Personnel and Senior Management reward linkeddirectly to their effort performance dedication and achievement relating to theCompany’s operations.

To retain motivate and promote talent and to ensure long termsustainability of talented managerial persons and create competitive advantage.

To assist the Board in fulfilling responsibilities.

Constitution of Committee

The Nomination and Remuneration Committee constituted should consist of three or morenon-executive directors out of which not less than one-half should be independentdirectors. However the chairperson of the company (whether executive or nonexecutive) maybe appointed as a member of the Nomination and Remuneration Committee but shall not chairsuch Committee. In the absence of the Chairman the members of the Committee present atthe meeting shall choose one amongst them to act as Chairman.

Chairman of the Nomination and Remuneration Committee meeting could be present at theAnnual General Meeting or may nominate some other member to answer the shareholders’queries. Minimum two (2) members shall constitute a quorum for the Committee meeting.Membership of the Committee shall be disclosed in the Annual Report.

Role of Committee

The Role and Powers of the Committee shall be as under:

Formulation of the criteria for determining qualifications positiveattributes and independence of a director and recommend to the Board a policy relating tothe remuneration of the directors key managerial personnel and other employees;

Formulation of criteria for evaluation of Independent Directors and theBoard;

Devising a policy on Board diversity;

Identifying persons who are qualified to become directors and who may be appointedin senior management in accordance with the criteria laid down and recommend to the Boardtheir appointment and removal.

Definitions

• "Act" means Companies Act 2013 and rules framed thereunder.

• "Board" means Board of Directors of the Company as constitutedfrom time to time.

• "Policy" or "This policy" means Nomination andRemuneration Policy.

• "Committee" means Nomination and Remuneration Committee of theCompany as constituted or reconstituted by the Board from time to time.

" Remuneration" means any money or its equivalent given orpassed to any person for services rendered by him and includes perquisites as definedunder the Income-tax Act 1961;

• "Key Managerial Personnel" means:

i. Managing Director or Chief Executive Officer or Manager and in their absence aWhole-time Director;

ii. Chief Financial Officer;

iii. Company Secretary;

iv. And such other officer as may be prescribed.

• "Senior Managerial Personnel" mean the personnel of the companywho are members of its core management team excluding Board of Directors. Normally thiswould comprise all members of management of rank equivalent to General Manager and aboveincluding all functional heads.

• "Independent Director" means a Director referred to in Section 149(6) of the Companies Act 2013.

Unless the context otherwise requires words and expressions used in this policy andnot defined herein but defined in the Companies Act 2013 as may be amended from time totime shall have the meaning respectively assigned to them therein

Appointment and Removal of Director KMP and Senior Management

1. Appointment Criteria and Qualifications:

a) The Committee shall identify and ascertain the integrity qualificationexpertise and experience of the person for appointment as Director KMP or at SeniorManagement level and recommend to the Board his / her appointment.

b) A person should possess adequate qualification expertise and experience for theposition he / she is considered for appointment. The Committee has discretion to decidewhether qualification expertise and experience possessed by a person are sufficient /satisfactory for the concerned position.

c) The Company shall not appoint or continue the employment of any person asWhole-time Director who has attained the age of seventy years. Provided that the term ofthe person holding this position may be extended beyond the age of seventy years with theapproval of shareholders by passing a special resolution based on the explanatorystatement annexed to the notice for such motion indicating the justification for extensionof appointment beyond seventy years.

d) Appointment of Independent Directors is subject compliance of provisions ofsection 149 of the Companies Act 2013 read with schedule IV and rules framed thereunder.

2. Term / Tenure:

a) Managing Director/Whole-time Director: The Company shall appoint or re-appointany person as its Executive Chairman Managing Director or Executive Director for a termnot exceeding five years at a time. No re-appointment shall be made earlier than one yearbefore the expiry of term.

b) Independent Director: An Independent Director shall hold office for a term up tofive consecutive years on the Board of the Company and will be eligible for re-appointmenton passing of a special resolution by the Company and disclosure of such appointment inthe Board's report. At the time of appointment of Independent Director it should beensured that number of Boards on which such Independent Director serves is restricted toseven listed companies as an Independent Director and three listed companies as anIndependent Director in case such person is serving as a Whole-time Director of a listedcompany or such other number as may be prescribed under the Act.

The maximum tenure of Independent Directors shall also be in accordance with theCompanies Act 2013 and clarifications/ circulars issued by the Ministry of CorporateAffairs in this regard from time to time.

3. Evaluation:

The Committee shall carry out evaluation of performance of every Director KMP andSenior Management Personnel at regular intervals i.e. yearly or at such intervals as maybe considered necessary. The same may however be delegated by the Committee.

4. Removal:

Due to reasons for any disqualification as mentioned in the Act pursuant to section 164or under any other applicable provisions rules and regulations there under the Committeemay recommend to the Board with reasons recorded in writing removal of a Director KMPor Senior Management Personnel subject to the provisions and compliance of the said Actrules and regulations

5. Retirement:

Any Director other than the Independent Director KMP and Senior Management shallretire as per the applicable provisions of the Companies Act 2013 and the prevailingpolicy of the Company. The Board will have the discretion to retain the Director KMPSenior Management in the same position / remuneration or otherwise even after attainingthe retirement age for the benefit of the Company.

Remuneration to Directors / KMP/ SMP

1) Remuneration to Managing Director / Whole-time Directors:

a) The Remuneration/ Commission etc. to be paid to Managing Director / Whole-timeDirectors etc. shall be governed as per provisions of the Companies Act 2013 and rulesmade there under or any other enactment for the time being in force and the approvalsobtained from the Members of the Company.

b) The Nomination and Remuneration Committee shall make such recommendations to theBoard of Directors as it may consider appropriate with regard to remuneration to ManagingDirector / Whole-time Directors.

2) Remuneration to Non- Executive / Independent Directors:

a) The Non-Executive / Independent Directors may receive sitting fees and such otherremuneration as permissible under the provisions of Companies Act 2013. The amount ofsitting fees shall be such as may be recommended by the Nomination and RemunerationCommittee and approved by the Board of Directors.

b) All the remuneration of the Non- Executive / Independent Directors (excludingremuneration for attending meetings as prescribed under Section 197 (5) of the CompaniesAct 2013) shall be subject to ceiling/ limits as provided under Companies Act 2013 andrules made there under or any other enactment for the time being in force. The amount ofsuch remuneration shall be such as may be recommended by the Nomination and RemunerationCommittee and approved by the Board of Directors or shareholders as the case may be.

c) Any remuneration paid to Non- Executive / Independent Directors for servicesrendered which are of professional in nature shall not be considered as part of theremuneration for the purposes of clause (b) above if the following conditions aresatisfied:

i. The Services are rendered by such Director in his capacity as the professional; and

ii. In the opinion of the Committee the director possesses the requisite qualificationfor the practice of that profession.

3) Remuneration to Key Managerial Personnel and Senior Management:

a) The remuneration to Key Managerial Personnel and Senior Management shall consist offixed pay and incentive pay in compliance with the provisions of the Companies Act 2013and in accordance with the Company’s Policy.

b) The Fixed pay shall include monthly remuneration employer’s contribution toProvident Fund contribution to pension fund pension schemes etc. as decided from totime.

c) If any Managerial Personnel draws or receives directly or indirectly by way ofremuneration any such sums in excess of the limits prescribed under the Companies Act2013 or without the prior sanction of the Central Government where required he / sheshall refund such sums to the Company and until such sum is refunded hold it in trust forthe Company.

d) Increments if declared to the existing remuneration / compensation structure shallbe recommended by the Committee to the Board which should be within the limits approved bythe Shareholders in the case of Managerial Personnel.

4) Familiarization Program for Independent Directors:

The Company shall familiarize the Independent Directors with the company their rolesrights responsibilities in the Company nature of the industry in which the Companyoperates business model of the company etc. through various programs.

Proceedings of the Meeting

Proceedings of all meetings must be minuted and signed by the Chairperson of theCommittee at the subsequent meeting. Minutes of the Committee meeting will be circulatedat the subsequent Board and Committee meeting for noting.

Review and Amendment to the Policy

The Board of Directors on its own and / or as per the recommendations of Nomination andRemuneration Committee can amend this Policy as and when deemed fit.

The Committee or the Board may review the Policy as and when it deemsnecessary.

The Committee may issue the guidelines procedures formats reportingmechanism and manual in supplement and better implementation to this Policy if it thinksnecessary.

This Policy may be amended or substituted by the Committee or by the Boardas and when required and also by the Compliance Officer where there is any statutorychanges necessitating the change in the policy.

In case of any amendment(s) clarification(s) circular(s) etc. issued bythe relevant authorities not being consistent with the provisions laid down under thisPolicy then such amendment(s) clarification(s) circular(s) etc. shall prevail upon theprovisions and this Policy shall stand amended accordingly from the effective date as laiddown under such amendment(s) Clarification circular(s) etc.

Disclosure

The details of this Policy and the evaluation criteria as applicable shall be disclosedin the Annual Report as part of Board’s Report.

ANNEXURE C

SECRETARIAL AUDIT REPORT

[Pursuant to section 204(1) of the Companies Act 2013 and rule No. 9 of the Companies(Appointment and Remuneration Personnel) Rules 2014]

For The Financial Year Ended 31st March 2015

To

The Members

Gemstone Investments Limited

Room No. 105 1st Floor Shradhanand Building 274 Samuel Street Masjid Bander Mumbai-400 003

I have conducted the secretarial audit of the compliance of applicable statutoryprovisions and the adherence to good corporate governance practice by M/s. GemstoneInvestments Limited (hereinafter called "the Company"). Secretarial Auditwas conducted in a manner that provided us a reasonable basis for evaluating the corporateconducts / statutory compliances and expressing my opinion thereon.

Based on my verification of the Company’s Books Papers Minutes Books Forms andReturns filed and other records maintained by the Company and also the informationprovided by the Company its officers agents and authorized representatives during theconduct of secretarial audit I hereby report that in my opinion the Company has duringthe financial year ended 31st March 2015 complied with the statutory provisions listedhereunder and also that the Company has proper Board processes and compliance mechanism inplace to the extent in the manner and subject to the reporting made hereinafter.

I have examined the books papers minute books forms and returns filed and otherrecords maintained by M/s Gemstone Investments Limited ("the Company") for thefinancial year ended on 31st March 2015according to the provisions of:

i. The Companies Act 2013 (the Act) and the rules made thereunder for specifiedsections notified and came into effect from 12th September 2013 and sections and Rulesnotified and came into effect from 1st April 2014;

ii. The Securities Contracts (Regulation) Act 1956 (‘SCRA’) and the rulesmade thereunder;

iii. The Depositories Act 1996 and the Regulations and Bye -laws framed thereunder;

iv. Foreign Exchange Management Act 1999 and the rules and regulations made thereunderto the extent of Foreign Direct Investment and Overseas Direct Investment (not applicableto the Company during the Audit Period);

v. Reserve Bank of India Act 1934;

vi. The following Regulations and Guidelines prescribed under the Securities andExchange Board of India Act 1992 (‘SEBI Act’):-

a. The Securities and Exchange Board of India (Substantial Acquisition of Shares andTakeovers) Regulations 2011;

b. The Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 1992;

c. The Securities and Exchange Board of India (Issue of Capital and DisclosureRequirements) Regulations 2009;

d. The Securities and Exchange Board of India (Employee Stock Option Scheme andEmployee Stock Purchase Scheme) Regulations 2009 and The Securities and Exchange Boardof India (Share Based Employee Benefits) Regulations 2014 notified on 28th October 2014(not applicable to the Company during the Audit period);

e. The Securities and Exchange Board of India (Issue and Listing of Debt Securities)Regulations 2008 (not applicable to the Company during the Audit period);

f. The Securities and Exchange Board of India (Registrar to an Issue and Share TransferAgents) Regulations 1993 (not applicable to the Company during the Audit period) and

g. The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations2009 (not applicable to the Company during the Audit period) and;

vii. Other Laws applicable to the Company as per the representations made by theCompany.

In case of Direct and Indirect Tax Laws like Income Tax Act Service Tax Act Excise& Custom Acts I have relied on the Reports given by the Statutory Auditors of theCompany.

I have also examined compliance with the applicable clause of the following:

a. Secretarial Standards issued by The Institute of Company Secretaries of India. (notnotified hence not applicable the Company during the Audit Period); and

b. The Listing Agreements entered into by the Company with Bombay Stock ExchangeLimited.

During the financial year under report the Company has complied with the provisions ofthe Act Old Act Rules Regulations Guidelines Standards etc. mentioned above subjectto the following observations:

1. The Company has not complied with the Bank’s circular DNDS/(PD) CC No.200/03-10001/2010-11 dated 17/09/2010 for all the NBFC being credit institution arerequired to become member of at least one credit information Company.

2. The Company has not done Annual filing with Registrar of Companies for last threeyears. The Company has made default under section 164(2) of the Companies Act 2013.

3. The Company has outstanding balance as on 31/03/2015 of Rs. 20 lacs to M/s AsianComtrade Private Limited a Company listed in the register maintained under section 189 ofthe Companies Act 2013. However as per information and explanation given to us theCompany has not granted any loans secured or unsecured to Companies firms or otherparties listed in the register maintained under section 189 of the Companies Act 2013during the year.

4. Following enterprises are owned or significantly influenced by Key ManagerialPersonnel or their relatives:

a) Asian Fintrade Services Pvt. Ltd.

b) Asian Comtrade Pvt. Ltd.

c) Money Mount Securities Pvt. Ltd.

d) Power-Point Energy Pvt. Ltd.

I further report that:

The Board of Directors of the Company is duly constituted with proper balance ofExecutive Directors Non-Executive Directors and Independent Directors. The changes in thecomposition of the Board of Directors that took place during the year under review werecarried out in compliance with the provisions of the Act.

Adequate notice is given to all directors to schedule the Board Meetings agenda anddetailed notes on agenda were sent at least seven days in advance and a system exists forseeking and obtaining further information and clarifications on the agenda items beforethe meeting and for meaningful participation at the meeting.

Majority decision is carried through while the dissenting members’ views if anyare captured and recorded as part of the minutes.

I further report that there are adequate systems and processes in the Companycommensurate with the size and operations of the Company to monitor and ensure compliancewith applicable laws rules regulations and guidelines. The Company is in the process ofappointing a whole time Company Secretary and filing necessary Forms & Returns.

I further report that during the audit period there were no instances of:

i. Public / Rights / debentures / sweat equity.

ii. Buy-Back of securities.

iii. Major decisions taken by the Members in pursuance to Section 180 of the CompaniesAct 2013.

iv. Merger / amalgamation / reconstruction etc.

v. Foreign technical collaborations

This report is to be read with my letter of even date which is annexed as Annexure Iand form an integral part of this report.

For Mayank Arora & Co.
Sd/-
Date: - 05.09.2015 Mayank Arora
Place: - Mumbai Proprietor

Annexure I

To

The Members

Gemstone Investments Limited

Room No. 105 1st Floor Shradhanand Building 274 Samuel Street Masjid Bander Mumbai-400 003 .

My report of even date is to read along with this letter.

1. Maintenance of secretarial record is the responsibility of the management of theCompany. My responsibility is to express an opinion on these secretarial records based onmy audit.

2. I have followed the audit practices and processes as were appropriate to obtainreasonable assurance about the correctness of the contents of the Secretarial records. Theverification was done on test basis to ensure that correct facts are reflected insecretarial records. We believe that the processes and practices we followed provided areasonable basis for my opinion.

3. I have not verified the correctness and appropriateness of financial records andBook of Accounts of the Company.

4. Where ever required we have obtained the Management representation about thecompliance of laws rules and regulations and happening of events etc.

5. The compliance of the provisions of Corporate and other applicable laws rulesregulation standards is the responsibility of management. My examination was limited tothe verification of procedures on the test basis.

6. The Secretarial audit report is neither an assurance as to the future viability ofthe Company nor of the efficiency or effectiveness with which the management has conductedthe affairs of the Company.

7. I have reported in my audit report only those non-compliance especially inrespect of filing of applicable forms/documents which in my opinion are material andhaving major bearing on financials of the Company.

For Mayank Arora & Co.
Sd/-
Date: -05.09.2015 Mayank Arora
Place: - Mumbai Proprietor

ANNEXURE D

FORM NO. AOC-2

[Pursuant to clause (h) of sub-section (3) of section 134 of the Companies Act 2013and Rule 8(2) of the Companies (Account) Rules 2014]

Form for disclosure of particulars of Contracts/Arrangements entered into by theCompany with related Parties referred to in sub-section (1) of Section 188 of theCompanies Act 2013 including certain arm’s length transactions under third provisothereto:

1. Details of Contracts or Arrangements or Transactions not at Arm’s Lengthbasis:

Particulars Details
Name(s) of the related party and nature of relationship
Nature of contracts / arrangements / transactions
Duration of the contracts / arrangements/transactions Salient terms of the contracts or arrangements or transactions including the value if any
Justification for entering into such contracts or arrangements or transactions Nil
Date(s) of approval by the Board Amount paid as advances if any
Date on which the special resolution was passed in general meeting as required under first proviso to section 188

2. Details of Material Contracts or Arrangement or Transactions at arm’slength basis:

Particulars Details
Name(s) of the related party Asian Fintrade Services Pvt. Ltd.
Nature of relationship Associate Company
Nature of contracts/ arrangements/ transactions Investment in Equity
Duration of the contracts / arrangements/transactions From 2009 and still going on.
Salient terms of the contracts or arrangements or transactions including the value if any Rs. 2400000/-
Date(s) of approval by the Board if any 30thOctober 2009
Amount paid as advances if any None

 

For and on behalf of the Board
Sd/-
Place: Mumbai Mahendra Dave
Date: 5thSeptember 2015. Chairman & Director

ANNEXURE E

Conservation of Energy Technology Absorption and Foreign Exchange Earnings & Outgopursuant to provisions of section 134 of The Companies Act 2013 read with Companies(Accounts) Rules 2014.

A) CONSERVATION OF ENERGY:

Sr. No. Particulars Details
1. The steps taken or impact on conservation of energy N.A
2. The steps taken by the company for utilizing alternate sources of energy N.A
3. The capital investment on energy conservation equipments N.A

B) TECHNOLOGY ABSORPTION:

Sr. No. Particulars Details
1. The efforts made towards technology absorption N.A
2. The benefits derived like product improvement cost reduction product development or import substitution; N.A
3. In case of imported technology (imported during the last three years reckoned from the beginning of the financial year)- N.A
i. The details of technology imported;
ii. The year of import;
iii. Whether the technology been fully absorbed;
iv. If not fully absorbed areas where absorption has not taken place and the reasons thereof; and
4. The expenditure incurred on Research and Development. N.A

C. FOREIGN EXCHANGE EARNINGS AND OUTGO:

Particulars 2014-15 2013-14
Foreign Exchange Earnings NIL NIL
Foreign Exchange Outgo NIL NIL

 

For and on behalf of the Board
Sd/-
Place: Mumbai Mahendra Dave
Date: 5thSeptember 2015. Chairman & Director