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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

TO THE MEMBERS OF

HIRA AUTOMOBILES LIMITED

Your Directors have pleasure in presenting the 28th Board's Report of your Companytogether with the Audited Statement of Accounts and the Auditors' Report of your companyfor the financial year ended 31st March 2017.

FINANCIAL HIGHLIGHTS

Standalone (Rs in Lacs)
Particulars F.Y. 2016-17 F.Y. 2015-16
Gross Income 32144.64 31050.99
Profit Before Interest and Depreciation 841.79 796.37
Finance Charges 570.75 560.48
Depreciation & Amortization Expenses 157.13 135.82
Profit Before Tax 113.91 100.07
Provision for Tax 42.01 39.65
Net Profit After Tax 71.90 60.42
Prior Period Tax Expenses 4.01 4.11
Surplus carried to Reserve 67.89 56.31

STATE OF COMPANY'S AFFAIRS AND FUTURE OUTLOOK

The Company is an authorized dealer of Maruti 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

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 notrecommended any dividend this year.

AMOUNTS TRANSFERRED TO RESERVES

The Board of the company has decided to carry Rs. 67.89 lacs to its reserves andsurplus account.

CHANGES IN SHARE CAPITAL

There has been no change in Share Capital of the Company during the Financial Year2016-17.

INFORMATION ABOUT SUBSIDIARY/ JV/ 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 these 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.

MEETINGS OF THE BOARD OF DIRECTORS

During the Financial Year 2016-17 the Company held 11 Board meetings of the Board ofDirectors 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.

11.05.2016 30.05.2016 16.06-2016 1.08-2016 12.08-2016 14-09-2016
01.10.2016 14.11.2016 22-12-2016 14.02-2017 06.03.2017

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 applicableaccounting standards have been followed along with proper explanation relating to materialdepartures;

(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. The tenure of present auditors will come to an end at the conclusion ofensuing annual general meeting. The audit committee has proposed and the Board hasrecommended the appointment of Mohan Juneja Co. Chartered Accountants Patiala Punjab asstatutory auditors for a period of 5 years as required under section 139(2) of theCompanies Act 2013 which is to be confirmed and approved by the members.

There are no qualifications or adverse remarks in the Auditors' Report which requireany clarification/ explanation. The Notes on financial statements are self-explanatoryand needs no further explanation. Further the Auditors' Report for the financial yearended 31st March 2017 is annexed 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.

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.

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 Changes Date of Cessation
1. Jasleen Kaur Company Secretary Appointment 01.08.2016
2. Isher Singh Independent Director Expired 27.02.2017

DEPOSITS

The company has not accepted or renewed any deposits during the year and there are nounclaimed or unpaid deposits at the end of the financial 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.

PERSONNEL

The information required pursuant to Section 134(3) and Section 197(12) read with Rule5 (1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014in respect of employees of the Company and Directors is attached herewith. Furtherinformation required under Rule 5 (2) of The Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is nil as no employee of the Company is in receipt ofremuneration as stated therein.

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. Aseparate 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 VPart II Section II point IV is as under (a) The remuneration package of the directors areas follows

Name of Director Rahulinder Singh Sidhu Neha Sidhu
Salary Rs. 1259200/- Rs. 840000.00/-
Bonus 0.00 0.00
Stock Option 0.00 0.00
Pension 0.00 0.00

A) Performance linked incentives- Nil

b) Service contracts notice period servant fees- Nil

c) Stock option details- Nil

INDEPENDENT DIRECTORS AND DECLARATION

Smt. Rajbir Kaur and Smt.Rupinder Kaur were appointed as independent directors byshareholders on 30th September 2014 as per Section 149(10) of the Companies Act 2013 fora term of 5 consecutive years on the Board of the Company. The Board of Directors of theCompany hereby confirms that all the Independent directors duly appointed by the Companyhave given the declaration and they meet the criteria of independence as provided undersection 149(6) of the Companies Act 2013.

NOMINATION AND REMUNERATION COMMITTEE

Nomination and Remuneration Committee was reconstituted during the year and as per thesection 178(1) of the Companies Act 2013 the Company's Nomination and RemunerationCommittee comprises of two Non-executive Directors and one executive Director and Chairmanof the committee is Independent and Non executive Director. The table sets out thecomposition of the Committee as on 31.03.2017

Name of the Director Position held in the Committee Category of the Director
Rajbir Kaur Chairman Independent/ Non Executive
Rupinder Kaur Member Independent/ Non Executive
Rahulinder Singh Sidhu Member Independent/ Non Executive

The date of meetings of committee and attendance of members is given in report oncorporate governance attached with the report. 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 toattract retain and motivate Directors of the quality required to run the Companysuccessfully;

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

Audit Committee was reconstituted during the year and according to Section 177 of theCompanies Act 2013 the company's Audit Committee comprised of two Non-executive Directorsand one executive Director and Chairman of the committee is Independent and Non executiveDirector. The Board has accepted the recommendations of

the Audit Committee. The table sets out the composition of the Committee as on31.03.2017

Name of the director Position held in the Committee Category of the Director
Rajbir Kaur Chairman Independent/ Non Executive
Rupinder Kaur Member Independent/ Non Executive
Rahulinder Singh Sidhu Member Promoter/ Executive

The date of meetings of committee and attendance of members is given in report oncorporate governance attached with the report.

SECRETARIAL AUDIT REPORT

There are certain observations in the Secretarial Audit Report which require correctiveactions and the Board has given necessary instructions to take corrective action to theconcerned persons in this regard. Further the Secretarial Audit Report as provided by Mr.Ravinder Kumar Company Secretary in Practice for the financial year ended 31st March2017 is annexed herewith for your kind perusal and information.

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 Mehanism 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.

SHARES

A) Buy Back of Securities-The Company has not bought back any of its securities duringthe year under review.

b) Sweat Equity-The Company has not issued any Sweat Equity Shares during the yearunder review.

c) Bonus Shares-No Bonus Shares were issued during the year under review. EmployeesStock 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 and such internal financial controls are operating effectively.The Company has also appointed M/s. Rajbir Singh & Co.Cost and Management AccountantPatiala as Internal Auditor as required under Section 138 of the Companies Act 2013.

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.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report is attached herewith separately.

DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTION PROHIBITION& REDRESSAL) ACT 2013

The Company has in place `Prevention of Sexual Harassment Policy`. This Anti-SexualHarassment policy of the Company is in line with the requirements of The Sexual Harassmentof Women at the Workplace (Prevention Prohibition & Redressal) Act 2013. Allemployees (permanent contractual temporary and trainees) are covered under this policy.An Internal Complaints Committee (ICC) is in place to redress complaints receivedregarding sexual harassment. The following is a summary of sexual harassment complaintsreceived and disposed off during the year - No. of complaints received: Nil -No. ofcomplaints disposed off: NA

ACKNOWLEDGMENT

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
Rahulinder Singh Sidhu Neha Sidhu
Chairman And Managing Director Whole-time Director
Date : 30th May 2017 DIN : 00447452 DIN : 00460875
Place: Chandigarh