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Hira Automobile Ltd.

BSE: 531743 Sector: Others
NSE: N.A. ISIN Code: N.A.
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Hira Automobile Ltd. (HIRAAUTOMOBILE) - Director Report

Company director report

BOARD’S REPORT

TO

THE MEMBERS OF

HIRA AUTOMOBILES LIMITED

Your Directors have pleasure in presenting the 26th Board’s Report of your Companytogether with the Audited Statement of Accounts and the Auditors’ Report of yourcompany for the financial year ended 31st March 2015.

FINANCIAL HIGHLIGHTS
(Rs. In Lacs)
Particulars 2014-2015 2013-14
Gross Income 32425.90 30676.24
Profit Before Interest and Depreciation 734.42 556.38
Finance Charges 415.72 302.24
Depreciation & Amortization Expenses 155.95 103.76
Profit Before Tax 162.75 150.38
Provision for Tax 47.38 52.60
Net Profit After Tax 115.37 97.78
Prior Period Tax Expenses 7.53 0.00
Surplus carried to Reserve 107.84 97.78

STATE OF COMPANY’S AFFAIRS AND FUTURE OUTLOOK

The Company is an authorised dealer of Marutl Suzuki India Limited and is engaged inselling and providing after sale services of all its Brands. The Company foresees toughcompetition in selling of cars in future.

CHANGE IN NATURE OF BUSINESS. IF ANY

There has been no change in the business activities of the Company during the yearunder report.

DIVIDEND

The Board of Directors with the view to conserve the resources of company has notrecommending any dividend this year.

AMOUNTS TRANSFERRED TO RESERVES

The Board of the company has decided to carry Rs. 107.84 lacs to its reserves andsurplus account.

CHANGES IN SHARE CAPITAL. IF ANY

There has been no change in Share Capital of the Company during the Financial Year2014-15.

INFORMATION ABOUT SUBSIDIARY/ JW ASSOCIATE COMPANY

The Company does not have any Subsidiary Joint venture or Associate Company.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCTION AND PROTECTION FUND

The provisions of Section 125(2) of the Companies Act 2013 do not apply as there wasno dividend declared and paid last year and there is no unclaimed dividend.

MATERIAL CHANGES AND COMMITMENTS

No material changes and commitments affecting the financial position of the Companyoccurred between the period from the end of the financial year to which this financialstatements relate and on the date of this report

EXTRACT OF ANNUAL RETURN

The Extract of Annual Return as required under section 92(3) of the Companies Act 2013and rule 12(1) of the Companies (Management and Administration) Rules 2014 in Form MGT-9is annexed herewith for your kind perusal and information. (Annexure: 1)

MEETINGS OF THE BOARD OF DIRECTORS

During the Financial Year 2014-15 the Company held sixteen Board meetings of the Boardof Directors as per Section 173 of Companies Act 2013 which is summarized below. Theprovisions of Companies Act 2013 and listing agreement were adhered to while consideringthe time gap between two meetings.

04.04.2014 30.04.2014 30.05.2014 04.06.2014 12.06.2014 31.07.2014
31.08.2014 24.09.2014 29.09.2014 30.09.2014 17.10.2014 31.10.2014
19.12.2014 15.01.2015 31.01.2015 30.3.2015

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act 2013 the Board of Directors of theCompany confirms that-

(a) In the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;

(b) The directors 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 and loss of the company for that period;

(c) The directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;

(d) The directors have prepared the annual accounts on a going concern basis; and

(e) The directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.

(f) The directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.

AUDITORS AND REPORT THEREON

M/s. Pankaj Chugh & Associates Chartered Accountants Patiala was appointed asStatutory Auditors for a period of three years in the Annual General Meeting held on 30thSeptember 2014.

Their continuance of appointment and payment of remuneration are to be confirmed andapproved in the ensuing Annual General Meeting.

There are no qualifications or adverse remarks in the Auditors’ Report whichrequire any clarification/ explanation. The Notes on financial statements areself-explanatory and needs no further explanation.

Further the Auditors’ Report for the financial year ended 31st March 2015 isannexed herewith for your kind perusal and information.

LOANS. GUARANTEES AND INVESTMENTS

There were no loans guarantees or investments made by the Company under Section 186 ofthe Companies Act 2013 for third party during the year under review and hence the saidprovision is not applicable.

RELATED PARTY TRANSACTIONS

The Company has entered into various Related Parties Transactions as defined underSection 188 of the Companies Act 2013 with related parties as defined under Section 2(76) of the said Act. Further all the necessary details of transaction entered with therelated parties are attached herewith in Form No. AOC-2 for your kind perusal andinformation (Annexure: 2).

CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE OUTGO

The Information pursuant to Section 134(3)(m) pertaining to Conservation of EnergyTechnology Absorption and Foreign Exchange Outgo is provided in annexure herewith.(Annexure- 3)

RISK MANAGEMENT

The Company has insurance policy for all the assets of the Company and all theinsurance policies are renewed well in advance.

DIRECTORS AND KMP

During the current financial year the following changes have occurred in theconstitution of Board of Directors and KMP of the company:

S.No. Name Designation Date of appointment Date of cessation
1 Kuldeep Singh Bhattal Whole-time director - Expired on10.06.2014
2 Simran Bajwa Whole-time director - Resigned on 19.12.2014
3 Sukhdeep Kaur Company Secretary - Resigned on 31.08.2014
4 Sandeep Rana Chief Financial Officer 30.09.2014 -

DEPOSITS

The company has not accepted or renewed any deposits during the year and all thedeposits accepted earlier under The Companies Act 1956 has been repaid before the closeof financial year and there are no unclaimed or unpaid deposits at the end of thefinancial year.

CORPORATE SOCIAL RESPONSIBILITY

The company does not meet the criteria of Section 135 of Companies Act 2013 read withthe Companies (Corporate Social Responsibility Policy) Rules 2014 so there is norequirement to constitute Corporate Social Responsibility Committee.

RATIO OF REMUNERATION TO EACH DIRECTOR

The information required pursuant to Section 197 read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 and Companies(Particulars of Employees) Rules 1975 in respect of employees of the Company andDirectors is furnished hereunder: (Annexure:4)

Further no employee of the Company was in receipt of the remuneration exceeding thelimit prescribed in above said Section and Rules and therefore information on that countis nil.

ANNUAL EVALUATION

Pursuant to the provisions of the Companies Act 2013 the Board has carried out anannual performance evaluation of its own performance the directors individually as wellas the evaluation of the working of its Audit Nomination & Remuneration Committee.

A separate exercise was carried out to evaluate the performance of individual Directorsincluding the Chairman of the Board who were evaluated on parameters such as level ofengagement and contribution independence of judgment safeguarding the interest of theCompany and its minority shareholders etc. The performance evaluation of the IndependentDirectors was carried out by the entire Board. The performance evaluation of the Chairmanand the Non Independent Directors was carried out by the Independent Directors who alsoreviewed the performance of the Secretarial Department.

CORPORATE GOVERNANCE

Report on Corporate Governance along with the Certificate of M/s. Pankaj Chugh &Associates Chartered Accountants Patiala Statutory Auditors of the Company confirmingcompliance of conditions of Corporate Governance as stipulated in the Listing Agreementwith the Stock Exchanges forms part of the Board Report.

The information under Schedule V Part II Section II point IV is as under

a) The remuneration package of the directors are as follows:

Name of Director Rahulinder Singh Sidhu Neha Sidhu Simran Bajwa Kuldeep Singh Bhattal
Salary 950400.00 830400.00 577800.00 70000.00
Bonus 0.00 0.00 0.00 0.00
Stock Options 0.00 0.00 0.00 0.00
Pension 0.00 0.00 0.00 0.00

b) Performance linked incentives- Nil

c) Service contracts notice period servant fees- Nil

d) Stock option details- Nil

INDEPENDENT DIRECTORS AND DECLARATION

Shri Ramesh Kumar Shri Isher Singh Smt. Rajbir Kaur and Smt.Rupinder Kaur wereappointed as independent directors by shareholders on 30th September 2014 asper Section 149(10) of the Companies Act 2013 for a term of 5 consecutive years on theBoard of the Company. The Board of Directors of the Company hereby confirms that all theIndependent directors duly appointed by the Company have given the declaration and theymeet the criteria of independence as provided under section 149(6) of the Companies Act2013.

NOMINATION AND REMUNERATION COMMITTEE

As per the section 178(1) of the Companies Act 2013 the Company’s Nomination andRemuneration Committee comprises of three Non-executive Directors. The table sets out thecomposition of the Committee:

Name of the Director Position held in the Committee Category of the Director
Ramesh Kumar Chairman Independent/ Non Executive
Isher Singh Member Independent/ Non Executive
Rajbir Kaur Member Independent/ Non Executive

Terms of Reference

The Terms of Reference of the Nomination and Remuneration Committee are as under:

1. To identify persons who are qualified to become Directors and who may be appointedin senior management in accordance with the criteria laid down recommend to the Boardtheir appointment and removal and shall carry out evaluation of every Director’sperformance.

2. To formulate the criteria for determining qualifications positive attributes andindependence of a Director and recommend to the Board a policy relating to theremuneration for the Directors Key Managerial Personnel and other employees.

3. The Nomination and Remuneration Committee shall while formulating the policy ensurethat:

a. the level and composition of remuneration is reasonable and sufficient to attractretain and motivate Directors of the quality required to run the Company successfully;

b. relationship of remuneration to performance is clear and meets appropriateperformance benchmarks; and

c. remuneration to Directors Key Managerial Personnel and senior management involves abalance between fixed and incentive pay reflecting short and long-term performanceobjectives appropriate to the working of the company and its goals:

4. Regularly review the Human Resource function of the Company

5. Discharge such other function(s) or exercise such power(s) as may be delegated tothe Committee by the Board from time to time.

6. Make reports to the Board as appropriate.

7. Review and reassess the adequacy of this charter periodically and recommend anyproposed changes to the Board for approval from time to time.

8. Any other work and policy related and incidental to the objectives of the committeeas per provisions of the Act and rules made there under.

REMUNERATION POLICY

Remuneration to Executive Directors:

The remuneration paid to Executive Directors is recommended by the Nomination andRemuneration Committee and approved by Board in Board meeting subject to the subsequentapproval of the shareholders at the General Meeting and such other authorities as may berequired. The remuneration is decided after considering various factors such asqualification experience performance responsibilities shouldered industry standards aswell as financial position of the Company.

Remuneration to Non Executive Directors:

The Non Executive Directors have not been paid any Sitting Fees during the year.

AUDIT COMMITTEE

According to Section 177 of the Companies Act 2013 the companyAudit Committeecomprised of three directors. The board has accepted the recommendations of the AuditCommittee. The table sets out the composition of the Committee:

Name of the Director Position held in the Committee Category of the Director
Ramesh Kumar Member Independent/ Non Executive
Isher Singh Member Independent/ Non Executive
Rajbir Kaur Member Independent/ Non Executive

SECRETARIAL AUDIT REPORT

There are certain observations in the Secretarial Audit Report which require correctiveactions and the Board has given necessary instructions in this regard.

Further the Secretarial Audit Report as provided by Mr. Ravinder Kumar CompanySecretary in Practice for the financial year ended 31st March 2015 is annexed herewithfor your kind perusal and information(Annexure: 5).

VIGIL MECHANISM

As per Section 177(9) and (10) of the Companies Act 2013 and as per the Clause 49 ofthe Listing Agreement the company has established Vigil Mechanism for directors andemployees to report genuine concerns and made provisions for direct access to thechairperson of the Audit Committee. Company has formulated the present policy forestablishing the vigil mechanism/ Whistle Blower Policy to safeguard the interest of itsstakeholders Directors and employees to freely communicate and address to the Companytheir genuine concerns in relation to any illegal or unethical practice being carried outin the Company. The details of the Vigil Committee are annexed herewith for your kindperusal and information.

SHARES

a. BUY BACK OF SECURITIES

The Company has not bought back any of its securities during the year under review.

b. SWEAT EQUITY

The Company has not issued any Sweat Equity Shares during the year under review.

c. BONUS SHARES

No Bonus Shares were issued during the year under review.

d. EMPLOYEES STOCK OPTION PLAN

The Company has not provided any Stock Option Scheme to the employees.

ORDER OF COURT

There is no significant and material order passed by the regulators or courts orTribunals impacting the going concern status and company’s operation in future.

DETAILS OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS

Internal Financial Controls are adequate and are in consonance with the size andoperations of the Company.

SHARES IN SUSPENSE ACCOUNT

i. Aggregate number of shareholders and the outstanding shares in the suspense accountlying at the beginning of the year=nil

ii. Number of shareholders who approached issuer for transfer of shares from suspenseaccount during the year=nil

iii. Number of shareholders to whom shares were transferred from suspense accountduring the year=nil

iv. aggregate number of shareholders and the outstanding shares in the suspense accountlying at the end of the year=nil

SHARES IN UNCLAIMED SUSPENSE ACCOUNT

i. Aggregate number of shareholders and the outstanding shares lying in the UnclaimedSuspense Account at the beginning of the year=nil

ii. Number of shareholders who approached the issuer for transfer of shares from theUnclaimed Suspense Account during the year=nil

iii. Number of shareholders to whom shares were transferred from the Unclaimed SuspenseAccount during the year=nil

iv. Aggregate number of shareholders and the outstanding shares lying in the UnclaimedSuspense Account at the end of the year=nil

MATERIAL VARIATIONS

The material variations between the projections and the actual utilization are notapplicable:

CODE OF CONDUCT

The Code of Conduct of Hira Automobiles Limited is attached herewith (Annexure: 6).

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report is is attached herewith (Annexure: 7).

ACKNOWLEDGEMENT

Your Directors wish to express their grateful appreciation to the continuedco-operation received from the Banks Government Authorities Customers Vendors andShareholders during the year under review. Your Directors also wish to place on recordtheir deep sense of appreciation for the committed service of the Executives staff andWorkers of the Company.

For and on behalf of Board of Directors
HIRA AUTOMOBILES LIMITED
RAHUL INDER SINGH SIDHU NEHA SIDHU
MANAGING DIRECTOR WHOLE-TIME DIRECTOR
DATE : 30 MAY 2015 DIN: 00447452 DIN: 00460875
PLACE:CHANDIGARH