IEC Education Ltd.
|BSE: 531840||Sector: Services|
|NSE: N.A.||ISIN Code: INE172B01017|
|BSE LIVE 15:14 | 11 Sep||4.50||
|NSE 05:30 | 01 Jan||Stock Is Not Traded.|
IEC Education Ltd. (IECEDUCATION) - Director Report
Company director report
TO THE MEMBERS
Your Directors take pleasure in presenting to you the 22nd Annual Report together withthe Audited Accounts of the Company covering the Financial Year ended March 31 2016.
The Financial highlights of the Company for the Financial Year ended March 31 2016 areas follows:
(Rs. in Lakhs)
Operational Review / State of Companies Affairs
Income from operations of the Company decreased to Rs. 1.34 Lakhs a decline of 99.6%against Rs. 335.70 Lakhs in the previous year. Profit before taxation was Profit of Rs.12.12 Lakhs as against Loss of Rs. (13.28) Lakhs in the previous year. The net Loss ofthe Company is Rs. 8.36 Lakhs as against income of Rs. 8.07 Lakhs in the Previous Year.The competition in Education Sector has been increased tremendously. Many Institutionshave cancelled their PDP agreements with the company as the same are now covered underservice tax which has not been charged from the students and thus the institutions do notwant any financial burden on them.
Consolidated Financial Results
In compliance with Regulation 33 and Regulation 34 of SEBI (Listing Obligations andDisclosures Requirements) Regulations 2015 Financial Statements are prepared inaccordance with the Accounting Standards notified under section 133 of the Companies Act2013 read with rule 7 of Companies (Accounts) Rules 2014. The Consolidated FinancialStatements have been prepared in accordance with Accounting Standard 21 AccountingStandard 23 and Accounting Standard 27 as issued by The Institute of Chartered Accounts ofIndia and illustrate the financial resources assets liabilities income profit andother details of the company and its subsidiaries as a single entity after elimination ofminority interest. The Consolidated Financial Statements together with Auditor's reportthere on from part of the annual report.
The paid up equity capital of the Company as on March 31 2016 was Rs. 1526. Lakhs.During the year under review the Company has not issued any equity share preferenceshare or any other security.
The reserves of the Company stood at Rs. 1942.78 Lakhs as against Rs. 1934.42 Lakhsh inthe last Financial Year.
Your directors had not recommended any dividend for the financial year ended March 312016
Your Company has not accepted any deposit withing the meaning of section 73 of theCompanies Act 2013 read with Companies (Acceptance of Deposits) Rules 2014. During theyear under review there were no outstanding deposits.
During the year under consideratin Mr. Dheeraj Mangal was appointed as Non ExecutiveDirector of the Company at its Annual General Meeting held on September 29 2015. Mr.Girish Narang Non Executive Director of the Company resigned on July 13 2016 due toother pre occupations.
Meeting of the Board of Directors
During the Financial year ended March 31 2016 the meeting of Directors of yourCompany held 7 times on 30.04.2015 30.05.2015 08.08.2015 31.08.2015 10.10.201514.11.2015 and 13.02.2016.
Key Managerial Personnel
The Key Managerial Personnel of I EC Education Limited are:
1. Dr. Naveen Gupta - Managing Director
2. Mr. Ashutosh Kumar Jha - Chief Financial Officer
3. Mr. Mohnish Dutta - Company Secretary
M/s Nath & Hari Chartered Accountants continued as statutory auditors of thecompany for financial year ended March 31 2016. The Company has received necessarycertificate from them under section 139 and 141 of the Companies Act 2013 to the effectthat they satisfy the conditions under the said Act and the rules made thereunder fortheir appointment. As required under the SEBI (LODR) Regulations 2015 the StatutoryAuditors have also confirmed that they hold a valid certificate issued by the Peer ReviewBoard of the Institute of Chartered Accountants of India.
Auditors submitted their report on the financials of the Company for the year endedMarch 31 2016. The report was subjected to the following observations by the Auditor:
(i) Note No: 2.8 of financial statements relating to non registration of title deeds inrespect of one building premises (Net book value as at year end Rs. 49.56Lakhs Previous year Rs. 50.74 Lakhs)
Management's Response: The property originally belongs to two of the promotersjointly one of the promoters passed away and legal heirs were not available to completethe registration process. The property is in possession of the company since two decadesand company runs their Corporate Office on the same. The company is still putting itsefforts to get this done. All legal documents have been signed by Transferor in favor ofthe Company by means of Will Affidavit Surrender deed etc.
(ii) Note No.: 2.22 at serial no.2 of financial statements relating to adjustmentsof entries arising out of confirmation/reconciliation of the accounts of parties;
(i) The amount includes an investment of Rs. 8.56 Lakhs in one of the erstwhilesubsidiary IEC Infotech Sdn. Bhd. against which shares were not issued the matter isdisputed.
(ii) An amount advanced to one party during company's project of "School of Artsand Fashion" which shall be recoverable.
(iii) Note No.2.22 at serial no.5 of financial statements relating to non provisionof trade receivables and long term loans and advances considered doubtful amounting to Rs.427.50 Lakhs and Rs. 15.57 Lakhs respectively (Previous Year 499.71 Lakhs and Rs. 38.03Lakhs respectively)
Management's Response: Company was awarded "Computer Education Project"by Delhi Government and "Rajasthan School and College Project" by RajasthanGovernment during year 2000 and year 2003 respectively. Company successfully completedboth the projects however the payment was disputed by then Delhi Government and RajasthanGovernment. The matter is subject to Arbitration between Delhi Government and the Company.Regular correspondences are made with Rajasthan Government for recovery of the amount due.The management is confident that the money will be received from both the Governments.
(iv) Note No.2.22 at serial no.6 of Financial Statement relating to not booking theincome of Rs. 6.14 Lakhs (Previous Year 85 Lakhs) as per Agreement with one of the Trustin which a Director of the Company is interested. Accordingly revenue from operation wouldhave been increased by Rs. 6.14 Lakhs (Previous Year 85 Lakhs) and profit before tax andShareholders' fund would have been increased accordingly (previous Year 85 Lakhs)
Management's Response: The Company has cancelled the agreement with VocationalEducation Trust (The Trust) owing to delay in completion of Educational Project. Due todelays in receiving the regulatory approvals by the Trust and henceforth start of revenuesharing the Company has decided to annul the Agreement and recover the amount invested.The Company is in process of recovering the balanced amount invested in the project.
(v) Note No. 2.22 at serial no. 7 of Financial Statement relating to short provisionof service tax of Rs. Nil (Previous Year 321.64 Lakhs). Accordingly other expenses wouldhave been increased by Rs. Nil (Previous Year 321.64 Lakhs) and profit before tax for theyear and shareholders' fund would have been reduced accordingly (Previous Year 321.64Lakhs).
Management's Response: the Company has received Service Tax notice from thedepartment of Service Tax covering certain services of the Company under ambit of ServiceTax wherein an amount of Rs. 321.64 Lakhs was required to be paid to Service TaxDepartment which in the opinion of the Management is exempted from the purview of ServiceTax. The matter is subjudice before Principal Commissioner of Service Tax.
Extract of Annual Return
The details forming part of Annual Return in form MGT-9 is annexed herewith as AnnexureA.
Directors Responsibility Statement
In terms of section 134(5) of the Companies Act 2013 the directors would like tostate that:
1. In the preparation of the Annual Accounts for the period ended as on 31st March2016 the applicable Accounting Standards have been followed and no material departure hasbeen identified.
2. Accounting Policies have been consistently applied in a reasonable and prudentmanner so as to give true and fair view of the state of affairs of the Company for thefinancial year ended 31st March 2016 and of the Statement of Profit And Loss ended thatdate for the financial year ended 31st March 2016.
3. Proper and sufficient care has been taken for the maintenance of adequate records inaccordance with the applicable provisions of the Companies Act 2013 for safeguarding theAssets of the Company and for preventing and detecting fraud and other irregularities.
4. The Annual Accounts for the Financial Year ended 31st March 2016 have been preparedon going concern basis.
5. The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
6. The directors had devised proper system to ensure compliance with the provisions ofall applicable laws and that such system were adequate and operating effectively.
Details of Fraud reported by Auditors
No fraud as required under section 143 of the Companies Act 2013 has been reported bythe Auditors for the Financial Year ended March 31 2016.
Details of Material Orders Passed by Regulators
a. Arbitration with Delhi Government
Company was awarded "Computer Education Project" by Delhi Government duringyear 2000. Company successfully completed both the projects however the payment wasdisputed by then Delhi Government. The matter is subjudice in Arbitration before theHon'ble Arbitrator Ms. Janak Juneja and Ms. Shampa Chakraverty.
b. Service Tax
The Company has received Service Tax notice from the department of Service Tax duringFinancial Year 2014-15 covering certain services of the Company under ambit of Service Taxwherein an amount of Rs. 321.64 Lakhs was required to be paid to Service Tax Departmentwhich in the opinion of the Management is exempted from the purview of Service Tax. Thematter is subjudice before Principal Commissioner of Service Tax.
Declaration by independent Directors
All independent Directors have given declaration that they meet the criteria of-independence as laid down under section 149(6) of the Companies Act 2013.
Independent Directors considered / evaluated the performance of the non - independentDirectors at a meeting without anyone from the non - independent Directors and Management.
The Board subsequently evaluated performance of the Board the Committees andIndependent Directors (without participation of the relevant director).
Nomination and Remuneration Policy
The Board on the recommendation of the Nomination and Remuneration Committee hasalready framed a policy for selection and appointment of Directors Senior Management andtheir remuneration. The Company's policy on appointment and remuneration includingcriterial for determining qualifications positive attributes and independence areprovided in the Corporate Governance Report forming Part of the Annual Report. Thedetailed policy is available on the website of the Company at
M/s Dharamveer Dabodia and Associates firm of Company Secretaries has shown theirinability to conduct the secretarial audit of the Company for Financial Year ended March31 2016. Pursuant to section 204 of the Companies Act 2013 read with Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board of Directorshas appointed M/s Madhu Chopra & Associates to undertake the Secretarial Audit of theCompany. The Secretarial Audit Report is annexed herewith as Annexure B.
Particulars of Loans Guarantees or Investments
The company has not given any loans or guarantees of investments covered under theprovisions of section 186 of the Companies Act 2013.
Related Party Transaction
No new related party transaction was entered into during the current financial year.There are no materially significant related party transactions made by the company withPromoters Key Managerial Personnel or other designated persons which may have potentialconflict with interest of the company at large. The related party transaction policy isavailable on the Company's website at
Material Changes occurred between the end of financial year and date of report.
Company has received notice on May 26 2016 for termination of revenue sharingagreement form Vocational Education Foundation party to the agreement due to reasonsmentioned in the notice and for the repayment of the Principal amount Six months time wasrequested. The Board at their Meeting held on May 30 2016 has granted the time of fourMonths to Vocational Education Foundation for repayment of principal amount i.e. uptoSeptember 30 2016.
Conservation of Energy
a) Company ensures that its operations are conducted in the manner whereby optimumutilization and maximum possible saving s of energy is achieved.
b) No specific investment has been made in reduction in energy consumption.
c) As the impact of measures taken for conservation and optimum utilization of energyare not quantitative its impact on cost cannot be stated accurately.
The present global scenario your Company strives to maintain and improve quality of itsservices and takes appropriate measures to keep pace with fast changing technologicalinnovation.
Foreign Exchange Earnings and Out-Go
During the period under review there was no foreign exchange earnings or out flow.
Internal Control Systems and Their Adequacy / Risk Management
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. To maintain its objectivity and independence the InternalAudit function reports to the Chairman of the Audit Committee of the Board and to theChairman & Managing Director.
The Internal Audit Department monitors and evaluates the efficacy and adequacy ofinternal control system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company. Based on the report of internalaudit function process owners undertake corrective action in their respective areas andthereby strengthen the controls. Significant audit observations and recommendations alongwith corrective actions thereon are presented to the Audit Committee of the Board.
Corporate Social Responsibility
Company do not fall under the mandatory limits set for mandatory corporate socialresponsibility committee formation and contribution but company ensures that being partof the society it is duty to give back to the society and take efforts to do it.
Performance of Subsidiaries / Joint Ventures and Associates
As per the provisions of first proviso of sub section (3) of section 129 of theCompanies Act 2013 read with rule 5 of Companies (Accounts) Rules 2014 statementcontaining salient features of the financial Statement of Subsidiary Companies are givenalong with Consolidated Accounts in Form AOC - I. The Annual Accounts of Subsidiaries areprepared in accordance with AS- 21 and forms part of this Annual Report and accounts. TheAnnual Accounts of the Subsidiaries along with related detailed information will be madeavailable to the Members of the Company / Subsidiary Company seeking such information atsuch point of time. The Annual Accounts of the Company are also available for inspectionfor any Member during the business hours at the Registered Office of the Company andSubsidiary Companies can the same can be accessed from the website of the Company
In compliance with Regulation 24 of the SEBI (LODR) Regulations 2015 the company hasformulated Policy on Material Subsidiaries. The policy can be accessed at
At present the company has three subsidiaries:
1. IEC Learning and Management Limited
2. IEC Education and Infrastructure Limited
3. IEC Leasing and Capital Management Limited
The company does not have any material subsidiary as of now and none of the companyholds revenue of more than 10% of the revenue of their Holding Company. None of thesubsidiary companies holds any major loans or investment.
Pursuant to the provisions of proviso to sub-section 10 of section 177 of the CompaniesAct 2013 the Company has a vigil mechanism named Vigil Mechanism-Whistle Blower Policyto deal with instance of fraud and mismanagement if any.In staying true to our values ofStrength Performance and Passion and in line with our vision of being one of the mostrespected companies in India the Company is committed to the high standards of CorporateGovernance and stakeholder responsibility. The Policy can be accessed on the website ofthe company. http://iecgroup.in/pdf/Vigil%20Mechanism.pdf
Particulars of Employees
As per the provisions of section 13 of the Companies Act 2013 the Report of Accountsare being sent to all members of the Company excluding the information relating toEmployees to be given under section 197(12) of the Companies Act 2013 read with rule 5 ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014. Thesaid information would be available for inspection by the members at the Corporate Officeof the Company i.e. 19 4th Floor Community Center East of Kailash New Delhi - 110065during business hours on working upto the date of ensuing Annual General Meeting. If anymember is intersted in inspecting the same such members may write to the CompanySecretary in advance.
Code of conduct
As per regulation 17(5) of SEBI (LODR) Regulations 2015 the Company has laid downCode of Conduct for all Board Members of the Company as well as Senior Management and samehas been posted on website of the Company. Annual Compliance Report for the Year ended31st March 2016 has been received from all the Board Members and Senior Management of theCompany regarding compliance of all the Provisions of Code of Conduct. Further pursuant toschedule V of SEBI (LODR) Regulations 2015 declaration regarding compliance by Boardmembers and senior management personnel with the Companies Code of Conduct is herebyattached as Annexure D to this report.
Additionally company has also adopted code of conduct for Independent Directors of theCompany in accordance with Companies Act 2013 and SEBI (LODr) Regulations 2015.
Report on Corporate Governance and Management Discussion and Analysis
The essence of existence of Corporate lies in good Corporate Governance Practice. YourCompany has always adhered itself towards best governance practice. Your Company hasmaintained high level of integrity and transparency towards compliance of all lawsregulations rules guidelines whether provided by any enactment or issued by SEBI.
As required under Regulation 34 of SEBI (LODR) Regulations 2015 read with Schedule Vto the said regulations a report on Corporate Governance and Management Discussion andAnalysis Report are annexed to this Annual Report and forms part of it.
Further pursuant to Schedule V of SEBI (LODR) Regulations 2015 a certificate from M/sNath and Hari Chartered Accountants Delhi the Statutory Auditors of the Compnayconfirming compliance of conditions of Corporate Governance is annexed as Annexure E tothis report.
Registrar and Share Transfer Agents
M/s Alankit Assignments Ltd. in the capacity of Registrar and Share Transfer Agents ofyour Company is looking after all the matters relating to shares in transfer anddematerialisation.
Members are hereby requested to send their correspondence regarding transfer of sharesDemat of shares and other queries to Registrar and Share Transfer Agents AlankitAssignments Ltd. 2E/21 Alankit House Jhandewalan Ext. New Delhi - 110 055
None of the Directors of your Company is disqualified as per the provisions of section164 of the Companies Act 2013. The Directors of your Company has made necessarydisclosure as required under various provisions of Companies Act 2013 and ListingAgreement.
Listing of Shares
The shares of your Company are listed at
1. Bombay Stock Exchange Phirozee Jeejeebhoy Tower 25th floor Dalal StreetMumbai-400001
Disclosures of Shares lying in Suspence Account
Pursuant to Schedule V of SEBI (LODR) Regulations 2015 the details in respect of theshares lying in the suspense account till March 31 2016 is as under:
Your Directors wish to place on record their gratitude in receipt of continued supportand co-operation from various stakeholders including and not limiting to ShareholdersCustomers institutions Governmental and Semi Governmental Agencies Consultants otherbusiness Associates and Employees of the Company.