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High Ground Enterprise Ltd.

BSE: 517080 Sector: Others
NSE: HIGHGROUND ISIN Code: INE361M01021
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OPEN 12.87
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VOLUME 48925
52-Week high 46.45
52-Week low 8.00
P/E 11.11
Mkt Cap.(Rs cr) 139
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 12.87
CLOSE 12.34
VOLUME 48925
52-Week high 46.45
52-Week low 8.00
P/E 11.11
Mkt Cap.(Rs cr) 139
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

High Ground Enterprise Ltd. (HIGHGROUND) - Director Report

Company director report

To

The Members

Your Directors have pleasure in presenting the 31st Annual Report on thebusiness and operations of the Company together with the audited financial statements forthe financial year ended March 31 2016.

HIGHLIGHTS OF FINANCIAL RESULTS

The Company’s financial performance for the year ended March 31 2016 issummarised below:

Particulars Year ended March 31 2016 Year ended March 31 2015
*Consolidated Standalone Standalone
Net Revenue from operations:
Engineering Procurement Construction 19339.52 19339.52 12535.08
Management (EPCM)
Media Consulting and allied services 5487.68 5463.27 2859.17
Total Revenue from operations 24827.20 24802.79 15394.25
Other Income 870.20 870.20 61.33
Total expense other than Finance 23085.03 23059.35 13863.26
Cost Depreciation and amortization
Earnings before Finance Cost Depre- ciation amortization and tax (EBIDTA) 2612.37 2613.64 1592.32
Depreciation & amortization 132.90 132.63 95.00
Earnings before Finance Cost and Tax 2479.47 2481.01 1497.32
Finance costs (net) 320.63 320.56 220.88
Profit before tax (PBT) 2158.84 2160.45 1276.44
Tax expenses 748.28 747.95 433.86
Profit after tax (PAT) 1410.56 1412.50 842.58
Basic earnings per share (`) 1.35 1.35 9.94
Diluted earnings per share 1.38 1.38 9.94
(Face Value of Share is Re 1/- per share) (Face Value of Share is Re 1/- per share) (Face Value of Share is Rs. 10/- per share)

*Previous year the financial statements of the Company were prepared on standalonebasis as there was no subsidiary in that year.

DIVIDEND

The Board of Directors of the Company at their meeting held on May 30 2016 haverecommended a dividend of Re. 0.10/- (Ten Paisa) per equity share of Re. 1/- (i.e.10% onthe face value of the shares) as final dividend for the financial year 2015-16.

The dividend will be paid to members whose names appear in the Register of Members ason September 8 2016 and in respect of shares held in dematerialized form it will be paidto members whose names are furnished by National Securities Depository Limited and CentralDepository Services (India) Limited as beneficial owners as on that date.

CORPORATE GOVERNANCE

The Company has vigorously taken steps to follow the best corporate governancepractices aimed at building trust among the key stakeholders shareholders employeescustomers suppliers and other stakeholders on four key elements of corporate governance -transparency fairness disclosure and accountability and the Certificate from PracticingCompany Secretary forms a part of this Report.

OPERATIONS AND BUSINESS PERFORMANCE:

Turnover

During the year ended March 31 2016 the Company’s total revenue is Rs.25672.99 lacs as against Rs. 15455.58 Lacs in the previous period.

Analysis of Income from Operations

During the year under review income from Engineering Procurement and ConstructionManagement was Rs. 19339.52 Lacs as compared to Rs. 12535.08 Lacs during the previousyear. During the year under review income from Media consulting and allied services wasRs. 5463.27 Lacs as compared to Rs 2859.17 Lacs during the previous year.

Financial Year Sales / Turnover (Rs. in Lakhs) Percentage of Total Turnover (%)
EPCM Media & Entertainment
2014-15 15455.58 81.10 18.50
2015-16 25672.99 75.33 21.28

Other Income

Other income for the year is Rs. 870.20 Lacs against Rs. 61.33 Lacs in the previousyear. Income from foreign exchange fluctuations and interest income are major contributorsto other income of the Company.

Other expenses

During the year other expenses were Rs.1368.79 Lacs as against Rs. 342.71 Lacs in theprevious period.

DIRECTORS

Pursuant to sections 149 152 and other applicable provisions if any of the CompaniesAct 2013 one-third of such of the Directors as are liable to retire by rotation shallretire every year and if eligible offer themselves for re-appointment at every AGM.Consequently Mr. Chintan Kapadia (DIN: 01639589) Director will retire by rotation at theensuing AGM and being eligible offer himself for re-appointment in accordance with theprovisions of the Companies Act 2013.

The Board pursuant to section 149 152 and other applicable provisions if any of theCompanies Act 2013) and the Rules made thereunder as amended from time to time readwith Schedule IV to the Act has recommended the appointment of Mr. Sudhir Yashwantrao(DIN- 07604277) and Mr. Mataprasad Sharma (DIN: 07602766) as Non-Executive IndependentDirector of the Company not subject to retirement by rotation who has submitted adeclaration that they meets the criteria for independence as provided in Section 149(6) ofthe Act and who in the opinion of the Board of Directors of the Company fulfills theconditions specified in the act and is eligible for appointment. The Company has alsoreceived a notice in writing from a member proposing their candidature for the office ofDirector along with a deposit of Rupees One lakh in accordance with the provision of theCompanies Act 2013.

Further during the year under review following directors of the Company have resignedfrom the Directorship of the Company:

Sr. No. Name of the Director Date of Resignation
1 Mr. Vinod Rawal January 15 2016
2 Mr. Ajit Sharma August 17 2016

The Board places on record its appreciation to the resigned directors for theirvaluable guidance provided during their tenure as Director of the Company.

DECLARATION BY INDEPENDENT DIRECTORS: {SECTION 134 (3)(D)}

The Independent Directors of the Company are not associated with the Company in anymanner as stipulated under section 149(6) of Companies Act 2013 and at same time possessrelevant expertise and experience that are additive to the Board of the Company fordelivering higher growth and higher value.

The brief resume of the Directors being appointed/ reappointed the nature of theirexpertise in specific functional areas names of companies in which they have heldDirectorships Committee Memberships/ Chairmanships their shareholding etc. arefurnished in the explanatory statement to the notice of the ensuing AGM.

The Directors recommend their appointment/re-appointment at the ensuing AGM.

Pursuant to the provisions under Section 134(3)(d) of the Companies Act 2013 withrespect to statement on declaration given by Independent Directors under Section 149(6) ofthe Act the Board hereby confirms that all the Independent Directors of the Company havegiven a declaration and have confirmed that they meet the criteria of independence asprovided in the said Section 149(6).

KEY MANAGERIAL PERSONNEL

The Key Managerial Personnel (KMP) in the Company as per Section 2(51) and 203 of theCompanies Act 2013 are as follows:

Sandeep Ramkrishna Arora Chairman & Managing Director
Chintan Kapadia Whole Time Director
#Ramkrishna Shukla Company Secretary & Compliance Officer
*Satish Deshmukh Company Secretary & Compliance Officer
Arunkumar Tyagi Whole Time Director

#Mr. Ramkrishna Shukla Company Secretary & Compliance Officer resigned w.e.f.December 24 2015.

*Mr. Satish Deshmukh Company Secretary & Compliance Officer resigned w.e.f.August 1 2016.

The Board of Directors of the Company has appointed Ms. Unnati A. Amodwala as CompanySecretary & Compliance officer w.e.f. September 1 2016.

PARTICULARS OF REMUNERATION OF DIRECTORS/ KMP/ EMPLOYEES

In terms of the provisions of Section 197(12) of the Companies Act 2013 read withRules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 there are NIL employees drawing remuneration in excess of thelimits prescribed in the Act.

Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is attached as ‘Annexure –A’ ’whichforms part of this report.

BOARD MEETINGS

During the financial year 2015-2016 the Board of Directors met 17 (Seventeen) timesand the date of Board Meeting were April 212015 May 11 2015 May 30 2015 July 62015 July 20 2015 July 27 2015 August 14 2015 August 26 2015 October 21 2015October 30 2015 November 10 2015 November 14 2015 December 16 2015 December 242015 January 25 2016 February 3 2016 and February 13 2016. The gap between any twomeetings has been less than 120 days.

Details of the Board of Directors and Attendance Record of Directors during thefinancial year ended March 31 2016 is as under:

Name Board Meetings held Board Meetings attended
*Vinod Rawal 17 3
Chintan Arvind Kapadia 17 17
Sandeep Ramkrishna Arora 17 17
Anupam Kumar 17 4
Paul Anthony Taylor 17 0
Sonia Khenduja 17 12
#Ajit Sharma Kamal 17 09
Arunkumar Tyagi 17 04

*Vinod Rawal has resigned from the Directorship of the Company w.e.f. January 152016. # Ajit Sharma has resigned from the Directorship of the Company w.e.f. August 172016.

SHARE CAPITAL

During the year under review the Company has issued shares in the following manner:

Sr. No. Date of Allotment / conversion Category No. of Shares / Allotted
1 April 21 2015 Promoter / PAC 728991 Equity shares of Rs. 10/- each at a issue price of Rs. 90/- including a premium of Rs. 80/- per share by way of conversion of warrants allotted on April 22 2014
2 October 30 2015 Non –Promot- ers 2785000 Equity shares for cash at a price of Rs. 54/- per equity share (including a premium of Rs. 53/- per Equity Share) on preferential basis
3 November 10 2015 Non –Promot- ers 493333 Equity shares for cash at a price of Rs. 54/- per equity share (including a premium of Rs. 53/- per Equity Share) on preferential basis

The entire share capital of the Company is listed and traded on BSE Limited.

Further to inform you that the Company has also sub–divided the Face Value of theEquity Shares of the Company from Rs. 10/- (Rupees Ten) each to Re. 1/- (Rupee One) eachfor which the Company has received new ISIN - INE361M01021 from CDSL & NSDL and allthe necessary approvals from the BSE has been obtained. The Company has authorized itsregistrar and share transfer agent to issue fresh share certificate arising uponsub-division of the face value of the shares.

Remuneration Policy

The Company’s Remuneration Policy for Directors Key Managerial Personnel andother employees is available on the website of the Company i.e.www.highgroundenterprise.com

Familiarization Programme

The Company has established a Familiarization Programme for Independent Directors.

As per Reg. 25(7) of SEBI (LODR) In which the Board briefed him about the followingpoints:

a) Nature of the industry in which the Company operates b) Business model of theCompany c) Roles rights responsibilities of independent directors d) Any other relevantinformation

RELATED PARTIES TRANSACTIONS

All the transactions with related parties are in the ordinary course of business and onarm’s length basis. The details of the transactions entered into between the Companyand the related parties are given in AOC-2 as Annexure B to this report.

Your attention is drawn to the Related Party disclosures set out in Note no. 2.(13) ofthe Standalone Financial Statements.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT2013

During the year under review the Company has not entered into any transactions undersection 186 of the Companies Act 2013. However previous year Un-Quoted Non – CurrentInvestment made by the Company is as follows:

Sr. No. Name of the Entity Particulars of Transaction Amount in Rs. Lacs (2015-16) Amount in Rs. Lacs (2014-15)
1 Rain Ltd. (U.K.) Investment in Joint Venture at cost Nil 359.08
2 HGEL Integrated Private Ltd. Investment in Subsidiary Company at cost 0.99 Nil
3 Color Bar Private Ltd. Investment in Subsidiary Company at cost 0.99 Nil
4 Chitra Talent Management Pvt. ltd. Investment in Associate Company at cost 0.49 Nil

Further during the year the Company has made investment by way of subscribing to theinitial share capital of the Company i.e. HGEL Integrated Private Limited & ColourBar Private Limited incorporated as wholly Owned Subsidiary Companies in order to heightenthe main business activity of the Company. Further the Company has made investment in aAssociate Company i.e. Chitra Talent Management Pvt. Ltd.

MATERIAL EVENTS THAT HAVE OCCURRED AFTER THE BALANCE SHEET DATE

There had been no material transactions that have occurred after the Balance SheetDate.

SIGNFICANT / MATERIAL ORDERS PASSED IMPACTING ON GOING CONCERN STATUS ANDCOMPANY’S OPERATIONS

A. Suspension and revocation of suspension in Trading of Securities of the Company byBSE Ltd.:

On March 28 2016 BSE Ltd vide Notice No 20160328-15 informed the Trading Membersregarding suspension in trading of certain securities wherein the name of our Company wasalso included. The notice issued by the BSE was of utter surprise to the Management asthe Company has a policy of following the laws and regulation in the spirit of goodgovernance and has always been compliant with the provision of the erstwhile listingagreement and present SEBI (LODR) Regulations 2015. The Company took instantaneous effortof filing an appeal to Securities Appellate Tribunal (SAT) vide Appeal No. 65 of 2016dated March 30 2016 against the action taken by BSE. Upon hearing the facts of both theparties to the appeal SAT vide its order dated March 30 2016 have discarded the actiontaken by BSE vide Notice No. 20160328 - 15 dated March 28 2016 and instructed BSE not tosuspend the trading in the securities of the appellant (M/s. High Ground EnterpriseLimited) subject to company submitting the required Auditors certificate within 2 (two)weeks from the date the order alongwith a cost of Rs. 10000/- (Rupees Ten Thousand) toBSE Ltd.

Further to state that the Internal Audit Committee of BSE Ltd. have considered theexplanation and documents submitted by the Company and vide their letter dated July 82016 have disposed off the case.

B. Payment of Penalty to BSE Ltd.:

Further the shareholders of the Company are hereby informed that during the year endthe Company has paid a penalty of Rs. 16854/- (Rupees Sixteen Thousand Eight Hundred andFifty Four only) to BSE Ltd. as a disciplinary action for late submission of AuditedFinancial Results for the quarter and year ended March 31 2015.

Save as aforesaid there have been no significant and material orders passed by anyregulators or courts or tribunals impacting the going concern status and company’soperations in future.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(5) of the Companies Act 2013 with respect tothe directors’ responsibility statement it is hereby confirmed that: (a) in thepreparation of the annual accounts for the year ended March 31 2016 the applicableAccounting standards had been followed along with proper explanation relating to thematerial departures; (b) the Directors of the Company had selected such accountingpolicies and applied them consistently and made judgments and estimates that arereasonable and prudent so as to give a true and fair view of the state of affairs of theCompany as at March 31 2016 and profit of the Company for the year ended March 31 2016.

(c) the Directors of the Company had taken proper and sufficient care for themaintenance of proper accounting records in accordance with the provisions of theCompanies Act 2013 for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities; (d) the Directors of the Company had preparedthe accounts of the Company for the financial year ended March 31 2016 on a going concernbasis and; (e) the Directors of the Company had devised proper systems to ensurecompliance with the provisions of all applicable laws and that such systems were adequateand operating effectively.

STATUTORY AUDITORS AND THEIR REPORT

Pursuant to section 139 of the Act your Company has appointed M/s. Jain Chowdhary& Co. Chartered Accountants (FRN: 113267W) as Statutory Auditors of the Company tohold office from the conclusion of the 29th Annual General Meeting until theconclusion of the next Annual General Meeting (AGM) subject to ratification ofre-appointment by the members at every AGM.

You are requested to ratify the re-appointment of Auditors and to authorize the Boardto fix their remuneration. The auditors M/s. Jain Chowdhary & Co. CharteredAccountants are eligible for re-appointment. A certificate from the auditors hasbeen received to the effect that their re-appointment if made would be within theprescribed limits. The Auditor’s Report for the FY 15-16 does not contain anyqualification reservations adverse remark or disclaimer. Further the notes to accountsreferred to in the Auditor`s Report and CARO are self-explanatory.

SECRETARIAL AUDITORS AND THEIR REPORT

Mr. Amit R. Dadheech Company Secretaries was appointed as Secretarial Auditors of theCompany for the financial year 2015-16 Pursuant to Section 204 of the Companies Act 2013.The Secretarial Audit Report submitted by them in the prescribed form MR- 3 is attached as"Annexure C" and forms part of this report.

There are qualifications observations and other remarks of the Secretarial Auditors inthe Report issued by them for the financial year 2015-16 which are self explanatory innature and does not call for any explanation from the Board of Directors.

NATURE OF BUSINESS

Presently the Company operates in two divisions namely:

Division 1: EPCM (Engineering Procurement and Construction Management) a) Oil &Gas sector b) Infra & support services / Consulting

Division 2: Allied media services (M&A)

There has been no change in the nature of business of the Company carried out by theCompany during the year under review.

SUBSIDIARIES:

The Company two wholly owned subsidiaries the details of the same are set below:

Sr. No Name of the Subsidiary Date of incorporation Country Business
1 Colour Bar Private Limited March 12 2015 India Post Production and other allied media activities infra –projects viz. mining & exploration of natural resourc- es & Stone Mining
2 HGEL Integrated Pvt. Ltd January 19 2015 India

Updates on Business operations of Colour Bar Private Limited:

Colourbar Pvt. Ltd. (CBPL) since its inception has done Digital Intermediate Blu-Raysand Digital Cinema Packages for many feature films television commercials music videos& short films some of which have received immense appreciation and awards.

CBPL boast to have executed and has been a part of films like ‘The HeadHunter’ ‘Kothanodi’ ‘Mor Mann Ke Bharam’ ‘GutrunGutargun’ which have won National Award Special Jury Award and winner of RajasthanInternational Film Festival (RIFF-2016).

CBPL is also very proud to be an integral part for a film titled ‘A Billion ColourStory’ produced by Mr. N Padmakumar and Mr. Satish Kaushik which has recently beenselected at the very prestigious ‘Busan Film Festival’ and ‘London FilmFestival’ where the film will be premiered.

To name a few more projects that CBPL was involved namely Charlie Ke Chakkar MeinTaleem Train Crash Pinti Ka Sabun Ankit Tiwari’s video and Benny Dayal’svideo.

Projects that are currently under Post-Production are named as ‘Just 30Minutes’ ‘Land 1857’ and three Kannada films and many other projects inpipeline.

Updates on Mining Project of HGEL Integrated Pvt. Ltd.:

The Company through its Wholly Owned Subsidiary (WOS) (i.e. HGEL Integrated PrivateLimited) have obtained environmental clearance from ‘The State Environment ImpactAssessment Authority (SEIAA) Haryana’. Pursuant to this clearance the Haryana StatePollution Control Board have granted Certificate to Operate (CTO) the Stone Mining.Pursuant to this approval the Company has commenced the mining at Bhakrija Plot No-Asituated at Khasra No. 65 Village Karota over an area of 9.55 Ha. under Category"B2" in Tehsil - Narnaul District- Mahendergarh Haryana.

The statement containing salient features of the financial statement of the abovesubsidiaries in Form AOC-1 is given in "Annexure-D".

These documents shall also be available for inspection at the registered office of theCompany during business hours up to the date of the ensuing AGM.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:

Pursuant to provisions of Section 134 of the Companies Act 2013 read with Rule 8(3) ofthe Companies (Accounts) Rules 2014 the details of Conservation of Energy TechnologyAbsorption are not applicable to the Company.

Details of Foreign Earning & Outflow are stated below:

(Rs. In lacs)
Particulars Amount 2015-16 Amount 2014-15
Foreign Earning 44.15 26.33
Foreign Exchange Out-flow Nil Nil

CHANGE IN CAPITAL STRUCTURE AND LISTING OF SHARES

The Company’s shares are listed on the Bombay Stock Exchange (BSE) Limited. Thedetails of the same are mentioned below as on March 31 2016:

Name of the Stock Exchange Number of shares (Equity) listed on the stock exchange
Bombay Stock Exchange Limited 104650863

Details of listed share capital as on the date of this report is as follows

Name of the Stock Exchange Number of shares (Equity) listed on the stock exchange
Bombay Stock Exchange Limited 104650863

The Company has regularly paid all the listing fees to the stock exchange and custodialfees to the depositories.

EXTRACT OF THE ANNUAL RETURN

An extract of the Annual Return for the year ended March 31 2016 as provided undersub-section (3) of Section 92 and prescribed under Rule 12 of Companies (Management &Administration) Rules 2014 is attached as "Annexure-E" and forms part ofthis report.

CORPORATE GOVERNANCE

As required by the existing Regulation 34(3) of the Listing Regulation a detailedreport on Corporate Governance is included in the Annual Report. The Practising CompanySecretary have certified the Company’s compliance of the requirements of CorporateGovernance in terms of Regulation 34(3) of the Listing Regulation and the same is annexedto the Report on Corporate Governance.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Social Welfare Activities has been an integral part of the Company since inception. TheCompany is committed to fulfill its social responsibility as a good corporate citizen. TheCompany fulfills the criteria set out in the section 135 of the Companies Act 2013 andrelevant rules stating applicability of the section. However the Board of Directors ofthe Company has constituted a CSR Committee during the year under review with 3 (three) ofits Board members. Contents of Corporate Social Responsibility Policy in the Board’sreport are given in the report on CSR activities in "Annexure F".

MANAGERIAL REMUNERATION:

Disclosures of the ratio of the remuneration of each director to the medianemployee’s remuneration and other details as required pursuant to Section 197(12) ofthe Companies Act 2013 read with Rule 5(1) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 is within the limits as prescribed under theCompanies Act 2013.The disclosure as required under section 134 of the Companies Act2013 read with relevant rules made therein under is attached as

"Annexure - A" and form part of this report

BOARD COMMITTEES

The Company has the following Committees of the Board:

• Audit Committee

• Stakeholders Relationship Committee

• Nomination & Remuneration Committee

• CSR Committee

The composition of each of the above Committees their respective role andresponsibility is as detailed in the Report of Corporate Governance.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Board of Directors of High Ground Enterprise Limited is committed to maintain thehighest standard of honesty openness and accountability and recognize that employees haveimportant role to play in achieving the goal. The Company’s Vigil Mechanism Policyencourages Directors and employees to bring to the Company’s attention instances ofunethical behavior and actual or suspected incidents of fraud or violation of the conductthat could adversely impact the Company’s operations business performance and / orreputation. The Policy provides that the Company investigates such incidents whenreported in an impartial manner and takes appropriate action to ensure that the requisitestandards of professional and ethical conduct are always upheld. It is the Company’sPolicy to ensure that no employee is victimized or harassed for bringing such incidents tothe attention of the Company. The practice of the Vigil Mechanism Policy is overseen bythe Board of Directors and no employee has been denied access to the Committee.

INTERNAL FINANCIAL CONTROL

The Company believes that internal control is a necessary concomitant of the principleof prudent business governance that freedom of management should be exercised within aframework of appropriate checks and balances. The Company remains committed to ensuring aneffective internal control environment that inter alia provides assurance on orderly andefficient conduct of operations security of assets prevention and detection offrauds/errors accuracy and completeness of accounting records and the timely preparationof reliable financial information.

In compliance of the provision of the Act the Company has appointed M/s. Ambavat Jain& Associates LLP Chartered Accountants as its internal auditor of the Company forthe financial year 2015-16.

The Company’s independent and Internal Audit processes both at the Business andCorporate levels provide assurance on the adequacy and effectiveness of internalcontrols compliance with operating systems internal policies and regulatoryrequirements.

The Financial Statements of the Company are prepared on the basis of the SignificantAccounting Policies that are carefully selected by management and approved by the Board.These in turn are supported by a set of divisional Delegation Manual & StandardOperating Procedures (SOPs) that have been established for individual units/ areas ofoperations.

The Company has in place adequate internal financial controls with reference to theFinancial Statements. Such controls have been tested during the year and no reportablematerial weakness in the design or operation was observed. Nonetheless the Companyrecognizes that any internal financial control framework no matter how well designed hasinherent limitations and accordingly regular audit and review processes ensure that suchsystems are reinforced on an ongoing basis.

RISK & MITIGATION

The Company has identified various risks faced by the Company from different areas. Asper the provision of the Companies Act 2013 and listing agreements the the Board hadadopted a risks management policy whereby a proper framework is set up. Appropriatestructures are present so that risks are inherently monitored and controlled. Acombination of policies and procedures attempts to counter risks as and when they evolve.

COST AUDITORS

As the Company is operating in the service industry cost audit is not applicable tothe Company and hence no reporting is required.

DISCLOSURE ON DEPOSIT UNDER CHAPTER V

The Company has neither accepted nor renewed any deposits during the Financial Year2015-16 in terms of Chapter V of the Companies Act 2013

DISCLOSURE AS REQUIRED UNDER SECTION 22 OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013

The Company is committed to provide a protective environment at workplace for all itswomen employees. To ensure that every woman employee is treated with dignity and respectand as mandated under The Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013" the Company has in place a formal policy for prevention ofsexual harassment of its women employees.

The following is the summary of sexual harassment complaints received and disposed offduring the current financial year.

Number of Complaints received: NIL Number of Complaints disposed off: NIL

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALSIMPACTING THE GOING CONCERNS STATUS AND COMPANY`S OPERATIONS IN FUTURE

The Company has not received any significant or material orders passed by anyRegulatory Authority Court or Tribunal which shall impact the going concern status andCompany`s operations in future.

INDUSTRIAL RELATIONS:

The Company maintained healthy cordial and harmonious industrial relations at alllevels the enthusiasm and unstinting efforts of employees have enabled the company toremain at the leadership position in the industry it has taken various steps to improveproductivity across organization.

ACKNOWLEDGEMENTS:

Your Directors place on record their gratitude to the Central Government StateGovernments and Company’s Bankers for the assistance co-operation and encouragementthey extended to the Company. Your Directors also wish to place on record their sincerethanks and appreciation for the continuing support and unstinting efforts of investorsvendors dealers business associates and employees in ensuring an excellent all aroundoperational performance.

Date: September 1 2016 By order of the Board of Directors
Place: Mumbai For High Ground Enterprise Limited
Regd. Office: Sd/- Sd/-
Office No. 2 Sandeep R Arora Chintan Kapadia
Om Heera Panna Mall Chairman & Managing Director Whole Time Director
2nd Floor Oshiwara DIN: 02587811 DIN: 02587811
Andheri (West)
Mumbai- 400053

ANNEXURE A TO DIRECTORS REPORT

Details pertaining to remuneration as required under Section 197(12) of the CompaniesAct 2013 read with Rules 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014.

The percentage increase in remuneration of each Director Chief Financial Officer andCompany Secretary during the financial year 2015-16 ratio of the remuneration of eachDirector to the median remuneration of the employees of the Company for the financial year2015-16 and the comparison of remuneration of each Key Managerial Personnel (KMP) againstthe performance are as under

Sr. No. Name of Director / KMP and designation Remuneration for the FY 2015-16 (Amt. in Rs.) % increase in remuneration in the FY 2015-16 Ratio of remuneration to median employees remuneration
1. Mr. Sandeep R. Arora Rs. 2340000/- p.a. Nil 11.14
2. Mr. Chintan A. Kapadia Rs. 3400000/- p.a. 141.67% 16.19
TOTAL Rs. 5740000/- 141.67% 27.33

Comparison of the remuneration of the key managerial personnel against the performanceof the Company:

Aggregate remuneration of key managerial personnel (KMP) in FY 16 57.40
Revenue 25672.99
Remuneration of KMPs (as a % of revenue) 0.22
Profit before Tax (PBT) 2160.45
Remuneration of KMP (as a % of PBT) 2.66

Further the List of top 10 employees drawing highest salary is mentioned below:

Sr. No. Name of the Employee Designation Amount (in Rs.)
1 Manish Mehrotra CEO (EPCM Division) 1500000
2 Mrs. Priya Mehrotra Chief General Manager 1200000
3 Mr.Santosh Mishra GM Project 612250
4 Mr. Mohit K. Puri Senior Technical Manager 454838
5 Mr. Amritlal Rana Senior Accountant 431688
6 Mr. Jayprakash Yadav Accountant 360000
7 Mr. ShivKumar Garg Senior Accountant 340805
8 Mr. Kalpesh Patel Accountant 324000
9 Mr. Swaminath Jaiswar Senior Accountant 315000
10 Mr. Anand Kumar Moriya Senior Administrative Manager 267584

ANNEXURE B TO DIRECTORS REPORT

Form no. AOC-2

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

Details of contracts or arrangements or transactions at arm’s length basis:

(a) Name(s) of the related party and nature of relationship: Mr. Sandeep R. Arora (Managing Director) Mr. Chintan Kapadia (Whole Time Director) Mr. Sandeep R Arora (Managing Director) Colour Bar Pvt. Ltd. (Subsidiary) HGEL Integrated Pvt. Ltd. (Subsidiary) Chitra Talent Management Pvt. Ltd. (Associate Company)
(b) Nature of contracts/ar- rangements/ transactions: The Company has entered into transaction with Mr. Sandeep R. Arora Managing Director of the Company by paying monthly rent of Rs. 300000/- per month for the premises owned by him to facilitate the business of the Company. Payment of Mana- gerial Remunera- tion to the Whole Time Director Payment of Mana- gerial Remunera- tion to the Manag- ing Director Loans and Advances given in the normal course of business for meeting the working capital Requirement Loans and Advances given in the normal course of business for meeting the working capital Requirement Loans and Ad- vances given for setting up the busi- ness and brand promotion
(c) Duration of the contracts / arrangements/ transactions: The duration entered for facilitating rent agreement with Mr. Sandeep R. Arora is for Thirty Three months 5 years 3 years One year One year One Year
(d) Salient terms of the contracts or arrangements or transactions including the value if any: Terms and condi- tions entered for facilitating rent agreement are as mutually agreed between Company and Mr. Sandeep R. Arora. As per appoint- ment letter executed by the company and the director. As per appoint- ment letter executed by the company and the director. As per Board Resolution dated March 12 2015 As per Board Resolution dated January 19 2015 As per Board Resolution dated July 29 2015
(e) Justification for entering into such contracts or arrangements or transactions Since Mr. Sand- eep R. Arora Managing Director of the Company own a premises and was willing to lend it on rent the management decided to take the premises for office use from the Director rather than opting for some other premises as it will be convenient to both the parties as well. As per industrial standards and as per the approval of the shareholders the Company is paying remunera- tion to the Whole Time Director As per industrial standards and as per the approval of the shareholders the Company is paying remunera- tion to the Manag- ing Director Subsidiary Com- pany Subsidiary Com- pany Associate Com- pany
(f) Date(s) of approval by the Board: September 1 2014 September 1 2014 April 21 2015 March 12 2015 January 19 2015 July 29 2015
(g) Amount paid as advances if any: (Rs. In lacs) Nil Nil Nil 7.13 277.90 151.21
(h) Date on which the special resolution was passed in gen- eral meeting as required under first proviso to section 188: Earlier the shareholder ap- proval was taken on September 27 2013 under Companies Act 1956 and under new Companies Act 2013 the ap- proval was taken on September 27 2014 September 27 2014 September 21 2015 N.A N.A N.A

ANNEXURE C TO DIRECTOR’S REPORT

FORM NO. MR-3

SECRETARIAL AUDIT REPORT

FOR THE FINANCIAL YEAR ENDED 31ST MARCH 2016

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

To

The Members

High Ground Enterprise Limited

Office No. 2 Om Heera Panna Mall 2nd Floor Oshiwara Andheri (West) Mumbai-400053

We have conducted the secretarial audit of the compliance of applicable statutoryprovisions and the adherence to good corporate practices by High Ground EnterpriseLimited (CIN:L74999MH1986PLC222681) (hereinafter called "the company").Secretarial Audit was conducted in a manner that provided us a reasonable basis forevaluating the corporate conducts/ statutory compliances and expressing our opinionthereon.

Based on our verification of High Ground Enterprise Limited books papersminute books forms and returns filed and other records maintained by the company and alsothe information provided by the Company its officers agents and authorizedrepresentatives during the conduct of the Secretarial Audit we hereby report that in ouropinion the Company has during the audit period covering the financial year ended onMarch 31 2016 complied with the statutory provisions listed hereunder and also that theCompany has proper Board processes and compliance mechanism in place to the extent in themanner and subject to the reporting made hereinafter:

We have examined the books papers minute books forms and returns filed and otherrecords maintained by High Ground Enterprise Limited for the financial year ended on March31 2016 according to the provisions of:

1. The Companies Act 2013 (the Act) and the rules made thereunder;

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

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

4. Foreign Exchange Management Act 1999 and the rules and regulations made thereunderto the extent of Foreign Direct Investment Overseas Direct Investment and ExternalCommercial Borrowings;

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

6. The Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 2015;

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

8. The Securities and Exchange Board of India (Employee Stock Option Scheme andEmployee Stock Purchase Scheme) Guidelines 1999; (During the period under review theCompany has not entered into any transaction requiring compliances with the Securities andExchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase

Scheme) Guidelines 1999)

9. The Securities and Exchange Board of India (Issue and Listing of Debt Securities)Regulations 2008; (During the period under review the Company has not entered intoany transaction requiring compliances with the Securities and Exchange Board of India(Issue and Listing of Debt Securities) Regulations 2008)

10. The Securities and Exchange Board of India (Registrars to an Issue and ShareTransfer Agents) Regulations 1993 regarding the Companies Act and dealing with client;

11. The Securities and Exchange Board of India (Delisting of Equity Shares)Regulations 2009; and (During the period under review the Company has not enteredinto any transaction requiring compliances with the Securities and Exchange Board of India(Delisting of Equity Shares) Regulations 2009)

12. The Securities and Exchange Board of India (Buyback of Securities) Regulations1998; (During the period under review the Company has not entered into any transactionrequiring compliances with the Securities and Exchange Board of India (Buyback ofSecurities) Regulations 1998)

OTHER APPLICABLE LAWS:

With respect to the compliance system prevailing in the Company and on examination ofthe relevant documents and records in pursuance thereof on test check basis the Companyhas complied with the following laws applicable to the Company.

1. Employees Provident Fund and Miscellaneous Provisions Act 1952

2. Indian Contract Act 1872

3. Income Tax Act 1961 to the extent of Tax Deducted at Source under various Sectionand T.D.S. Returns filed.

4. Indirect Tax Laws relating to collections deductions wherever applicable paymentsmade and returns filed.

5. Shops and Establishment Act 1948.

6. The Copyright Act 1957

7. Trade Marks Act 1999

8. The Cinematograph Act 1952

The provisions of Section 135 of the Companies Act 2013 are applicable to the Companyand accordingly a sum being 2% of the average net profits of the Company made during thethree immediately preceding financial years were required to be spent by the Companyduring the financial year 2014-15 & 2015-16 as per its Corporate Social ResponsibilityPolicy. However the Board of Directors of the Company has given a detailed reason for notspending the said amount during the financial in the Directors Report of the Company. Wehave also examined compliance with the applicable clauses of the following: i) SecretarialStandards issued by The Institute of Company Secretaries of India. ii) The ListingAgreements entered into by the Company with BSE Ltd. upto November 30 2015 and SEBI(Listing Obligation and Disclosure Requirement) Regulations 2015 from December 1 2015.

During the period under review the Company has complied with the provisions of the ActRules Regulations Guidelines Standards etc. mentioned above.

We 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 period 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 unanimously however the dissenting members’ viewsif any are captured and recorded as part of the minutes.

We 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.

We further report that during the audit period:

i) The Company is in process of complying with the provision of section 203 of theCompanies Act 2013.

ii) As per section 123 of the Companies Act 2013 the Company has not paid thedividend for the financial year 2014-15 within the specified time as mentioned under theact. However at the date of the signing of this report there has been no outstandingpayment towards dividend.

iii) During the year under review the BSE Ltd has passed a general notice to all thetrading members of the exchange for suspending certain securities from trading on theexchange. Further the Company made an application to the Securities Appellate Tribunal(SAT) against arbitrary order passed by the BSE Ltd. Further SAT vide its order datedMarch 29 2016 held the suspension on stay. Further the BSE Ltd. vide their letter datedJuly 8 2016 have stated that the Audit Committee has gone through the documents submittedby the Company and the matter has been closed.

iv) As explained to us by the management there is unclaimed dividend from last twoyears in the Company. The relevant forms to be filed with the Registrar of Companies werenot available for inspection.

Note: This report is to be read with our letter of even date which annexed as AnnexureA and forms an integral part of this report.

Annexure A to the Secretarial Audit Report

The Members

High Ground Enterprise Limited

Office No. 2 Om Heera Panna Mall 2nd Floor Oshiwara Andheri (West) Mumbai-400053

1. We have not verified the correctness and appropriateness of financial records andBooks of Accounts of the Company.

2. Wherever required we have obtained the Management representation about thecompliance of laws rules and regulations and happening of events etc.

3. The compliance of the provisions of Corporate and other applicable laws rulesregulations standards is the responsibility of management. Our examination was limited tothe verification of procedures on the random test basis.

4. We 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 the random test basis to ensure that correct facts are reflectedin secretarial records. We believe that the processes and practices we followed provide areasonable basis for our opinion.

5. The Secretarial Audit report is neither an assurance as to the future viability ofthe company nor of the efficacy or effectiveness with which the management has conductedthe affairs of the Company.

For Amit R. Dadheech & Associates

Sd/-

Amit R. Dadheech

M. No.: 22889; C.P. No.: 8952

Mumbai August 25 2016

ANNEXURE D TO DIRECTORS REPORT

Form AOC-1

(Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 ofCompanies (Accounts) Rules 2014)

Statement containing salient features of the financial statement of subsidiaries/associate companies/joint ventures

Part "A": Subsidiaries

(Information in respect of each subsidiary to be presented with amounts in Rs.)

Sl. No. Particulars Details Details
1 Name of the subsidiary Colour Bar Private Limited HGEL Integrated Pri- vate Limited’
2 Reporting period for the subsidiary concerned if different from the hold- ing company’s reporting period March 31 2016 March 31 2016
3 Reporting currency and Exchange rate as on the last date of the rel- evant Financial year in the case of foreign subsidiaries Not Applicable Not Applicable
4 Share capital Rs. 100000/- divided into 10000 equity shares of Rs. 10/- each. Rs. 100000/- divided into 10000 equity shares of Rs. 10/- each
5 Reserves & surplus 45807 -
6 Total assets 2127810 11512500
7 Total Liabilities 1982003 11412500
8 Investments - -
9 Turnover 2440661 -
10 Profit before taxation 79157 (240645)
11 Provision for taxation 33350 -
12 Profit after taxation 45807 (240645)
13 Proposed Dividend - -
14 % of shareholding 99.90% 99.90%

Notes: The following information shall be furnished at the end of the statement: 1.Names of subsidiaries which are yet to commence operations 2. Names of subsidiaries whichhave been liquidated or sold during the year.

Part "B": Associates and Joint Ventures

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

Sr. No. Name of associates/Joint Ventures Chitra Talent Management Private Limited
1. Latest audited Balance Sheet Date March 31 2016
2 Shares of Associate/Joint Ventures held by the company on the year end. 4900 Equity shares of Rs. 10/- each.
No Amount of Investment in Associates/Joint Venture Extend of Holding% 49% of the total paid up share capital
3. Description of how there is significant influence The Company has "significant influence" which means control of at least 20% of total share capital according to Companies Act 2013
4. Reason why the associate/joint venture is not consolidated As the Company is having less than 50% control of the Associate Company
5. Net worth attributable to shareholding as per lat- est audited Balance Sheet 698126
6. Profit for the year -
• Considered in Consolidation
• Not Considered in Consolidation 293082

1. Names of associates or joint ventures which are yet to commence operations –Not Applicable 2. Names of associates or joint ventures which have been liquidated or soldduring the year. – Not Applicable

For Jain Chowdhary & Co. Chartered Accountants For High Ground Enterprise Limited For High Ground Enterprise Limited For High Ground Enterprise Limited
Sd/-
FR No.113267W Sd/- Sd/- Satish Deshmukh
Sd/- Sandeep R Arora Chintan Kapadia Company Secretary & Compliance
Siddharth Jain Chairman & Managing Whole Time Director officer
Partner Director DIN:01639589
M.No.104709 DIN:02587811