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Kapil Raj Finance Ltd.

BSE: 539679 Sector: Financials
NSE: N.A. ISIN Code: INE332Q01015
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P/E 130.43
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OPEN 30.00
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VOLUME 2
52-Week high 34.90
52-Week low 16.97
P/E 130.43
Mkt Cap.(Rs cr) 15
Buy Price 0.00
Buy Qty 0.00
Sell Price 30.00
Sell Qty 2.00

Kapil Raj Finance Ltd. (KAPILRAJFINANC) - Director Report

Company director report

To

The Members

Kapil Raj Finance Limited

Your Directors have pleasure in presenting their 30th Annual Report and theaudited financial statement for the financial year ended March 31 2016.

OPERATION AND FINANCIAL RESULTS:

The summary of operation and financial results of the company for the year withcomparative figures for last year is as under:

Particulars 2015-2016 2014-2015
(Rs.) (Rs.)
Net Revenue from Operations - -
Other Income 8995168.47 3066624.68
Profit before Exceptional and Extra ordinary items and tax 3401961.21 233618.85
Extra Ordinary Items 40238 -
Profit after Exceptional and Extra ordinary items and tax 3361723.21 233618.85
Profit before tax 3361723.21 233618.85
Profit after tax 2322337.89 13768.85
Amount Transferred to Reserves 2316518.74 212919.85

REVIEW OF OPERATIONS AND FUTURE PROSPECTS:

The Company has during the financial year under review has not generated revenue fromoperations. However the revenue from other income activity of Rs. 8895168.47 (previousyear 3066624.68) resulting in net profit of Rs. 2322337.89/- (previous year Rs.13768.85/-)

TRANSFER TO RESERVES:

The credit balance of Profit and Loss account is transferred to reserves in Balancesheet.

DIVIDEND:

Your Directors decided to plough back the profit and therefore it was decided dividendis not declared.

DIRECTORS:

Pursuant to Sections 149 152 and other applicable provisions of the Companies Act2013 one-third of such of the Directors as are liable to retire by rotation shall retireevery year and if eligible offer themselves for reappointment at every Annual GeneralMeeting. Consecutively Mr. Atul C. Doshi Chairman and Managing Director will retire byrotation at the ensuing Annual General Meeting and being eligible offer himself forreappointment in accordance with the provisions of the Companies Act 2013.

The following Board of Directors of the Company resigned during the year under reviewon and as per following details:

NAME OF DIRECTOR DIN DATE OF RESIGNATION
Santosh C. Mohite 02953365 29.02.2016
Sapna Naithani 01693883 30.08.2016

DECLARATION BY INDEPENDENT DIRECTOR: (SECTION 134 (3)(D)

Declaration by an Independent Director(s) that she meets the criteria of independenceas provided in sub-section (6) of Section 149 of the Companies Act 2013 is enclosed.

An independent director shall hold office for a term up to five consecutive years onthe Board of a Company and shall not be eligible for reappointment for next five years onpassing of a special resolution by the Company.

PARTICULARS OF REMUNERATION OF DIRECTORS/KMP/EMPLOYEES

The remuneration policy is directed towards rewarding performance based on review ofachievements. It is aimed at attracting and retaining high caliber talent. Theremuneration policy is in consonance with the existing practice in the Industry

PERFORMANCE EVALUATION

Pursuant to the provisions of the Companies Act 2013 and as per SEBI (LODR) 2015during the year under review the Board carried out the annual evaluation of its ownperformance. A structured questionnaire covering various aspects of the Board’sfunctioning such as adequacy of the composition of the Board and its Committees Boardculture execution and performance of specific duties obligation and governance wasdistributed to each member of the Board and inputs were received. The performanceevaluation of the Independent Directors who will be appointed at the ensuing AnnualGeneral Meeting was carried out by the entire Board. The performance evaluation ofNon-Independent Directors and the Board as a whole was carried out by the IndependentDirectors. The Directors expressed their satisfaction with the evaluation process

SHARE CAPITAL:

During the year under review the Company is having Authorized Share Capital as10000000 Equity Shares of Rs. 10/- each amounting to Rs. 100000000/- SubscribedIssued and Paid up Capital as 514000 Equity Shares of Rs.10/- amounting to Rs.51400000/-. There is no change in the share capital of the Company during the year underreview.

MANAGEMENT DISCUSSION AND ANALYSIS

A separate report on the Management Discussion and Analysis is attached as a separatepart of this Annual Report.

CORPORATE GOVERNANCE

In accordance with SEBI (LODR) Regulations 2015 as entered with the Stock Exchange andsome of the best practices followed internationally on Corporate Governance the reportcontaining the details of corporate governance systems and processes is as follows: AtKapil Raj Finance Limited Corporate Governance is all about maintaining a valuablerelationship and trust with all stakeholders. We consider stakeholders are playing veryimportant role in our success and we remain committed to maximizing stakeholder value beit shareholders employees suppliers customers investors communities or policy makers.This approach to value creation emanates from our belief that sound governance systembased on relationship and trust is integral to creating enduring value for all. We have adefined policy framework for ethical conduct of businesses. We believe that any businessconduct can be ethical only when it rests on the nine core values of Honesty IntegrityRespect Fairness Purposefulness Trust Responsibility Citizenship and Courage. Thecorporate governance is an important tool for the protection of shareholder andmaximization of their long term values. The objective of Corporate Governance is toachieve excellence in business thereby increasing stakeholders’ worth in the longterm which can be achieved keeping the interest of stakeholders’ and comply with allrules regulations and laws. The principal characteristics of Corporate Governance areTransparency Independence Accountability Responsibility Fairness and SocialResponsibility along with efficient performance and respecting interests of thestakeholders and the society as a whole.

COMPANY’S PHILOSOPHY ON CORPORATE GOVERNANCE

The Company's philosophy on corporate governance is been founded on the fundamentalideologies of the group viz. Trust Value and Service. Obeying the law both in letterand in spirit is the foundation on which the Company's ethical standards are built. Onadopting corporate governance the Company shall make a constant endeavor to achieveexcellence in Corporate Governance on continuing basis by following the principles oftransparency accountability and integrity in functioning so as to constantly striving toenhance value for all stakeholders and the society in general. As a good corporatecitizen the Company will maintain sound corporate practices based on conscienceopenness fairness professionalism and accountability in building confidence of itsvarious stakeholders in it thereby paving the way for its long term success. We are makingcontinuous efforts to adopt the best practices in corporate governance and we believe thatthe practices we are putting into place for the company shall go beyond adherence toregulatory framework. The Company's corporate governance philosophy has been furtherstrengthened by adopting a Code of Fair Practice in accordance with the guidelines issuedby Reserve Bank of India from time to time.

APPLICABILITY

As per the amendment made in the provisions of the Regulation 27 of SEBI (ListingObligation And Disclosure Requirement) Regulation 2015 with equity share capital of lessthan Rs 10 crores (ii) companies having net worth not exceeding of Rs 25 crores and(iii) companies listed on SME and SME-ITP platforms of the stock exchanges has to complywith the provision of SEBI (LODR) Regulation 2015. Since the Paid Share Capital of theCompany is below the Limit specified under the SEBI (LODR) Regulations 2015 theprovision / requirements of Corporate Governance as laid down under the SEBI (LODR)Regulations 2015 is not applicable to the Company. However the Company itself followthe standards of Corporate Governance but the disclosures required to be done underRegulation 27 (2) of SEBI (LODR) Regulations 2015 is not applicable to the Company.

DIRECTORS’ RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors make the following statement:

(i) That in the presentation of the annual accounts for the year ended March 31 2016applicable accounting standards have been followed and that there are no materialdepartures;

(ii) That they have in the selection of the accounting policies consulted thestatutory auditors and have applied them consistently and made judgments and estimatesthat are reasonable and prudent so as to give a true and fair view of the state of affairsof the Company for the year ended March 31 2016 and of the profit of the Company for theyear ended on that date

(iii) That they have taken proper and sufficient care to the best of their knowledgeand ability for the maintenance of adequate accounting records in accordance with theprovisions of the Companies Act for safeguarding the assets of the Company and forpreventing and detecting fraud and other irregularities;

(iv) That the annual accounts have been prepared on a going concern basis.

(v) That internal financial controls followed by the Company are adequate and wereoperating effectively

(vi)That the systems to ensure compliance with the provisions of all applicable lawswere adequate and operating effectively.

HOLDING SUBSIDIARY AND ASSOCIATE COMPANIES

The Company does not have any Holding/ Subsidiary/ Associate Company during the periodunder review.

SUBSIDIARIES COMPANIES:

The Company did not have any Holding/ Subsidiary/ Associate Company during the periodunder review.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION RESEARCH &DEVELOPMENT AND FOREIGNEXCHANGE EARNINGS AND OUTGO

(a) Energy conservation measures taken : Nil
(b) Additional investments and proposals if any being implemented for reduction of consumption of energy : Nil
(c) Impact of the measures at (a) and (b) above for reduction of energy consumption and consequent impact on the cost of production of goods : Nil
(d) Total energy consumption and energy consumption per unit of production : Nil
FORM-A: FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY
A. Power and fuel consumption : Nil
B. Consumption per unit of production : Nil
TECHNOLOGY ABSORPTION
FORM-B: FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO TECHNOLOGY ABSORPTION ETC.
I Research and Development : Nil
II Technology Absorption Adaptation and Innovation :Nil
FOREIGN EXCHANGE EARNINGS AND OUTGO
I. Earnings in Foreign Exchange during the year : Nil
II. Foreign Exchange outgo during the year :Nil

PARTICULARS OF EMPLOYEES

Particulars of employees as required to be disclosed in terms of Section 134 of theCompanies Act 2013 read with Rule 5 of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are made available at the registered office of theCompany. The members desirous of obtaining the same may write to the Company Secretary atthe registered office of the Company.

CHANGES IN APPOINTMENT OF THE STATUTORY AUDITORS DURING THE YEAR:

As per the provisions of Section 139 141142 and 143 of the CompaniesAct 2013 and rules pursuant to it M/s. Vinodchandra R Shah & Co(Mumbai) areappointed as Statutory Auditor of the Company for the period of five years subject to theratification by shareholders at every Annual General Meeting of the Company in place ofresigning Statutory Auditor M/s. Pankaj P. Sanghavi & Co. (Chartered Accountants) ashe has shown his unwillingness to continue.

CLARIFICATION FOR OBSERVATIONS AS REPORTED BY STATUTORY AUDITOR IN THEIR AUDIT REPORT

Pursuant to Section 139 of the Act the Auditor’s report for the financial year2015-16 contains qualifications remarks the clarification for the same are as follows:

1. The Company regrets the delay in submitting the Board meeting / general meetingminutes Statutory registers and other relevant papers to the Auditor for theirverification and comments

2. Further with respect to the qualifications raised by the Auditor for the businessactivities financial activities and other reporting we wish to state that the managementof the Company is taking appropriate steps for making necessary application with therelevant Authorities.

3. All the other qualifications observations mentioned by the Auditor in their reportare self explanatory and hence does not call for any comment by the Board of Directors.

DEPOSITS

During the period under review your Company has not accepted or invited any depositsfrom public.

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

There have been no significant and material orders passed by any regulators or courtsor tribunals impacting the going concern status and company’s operations in future.

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

The Company has made transactions which are within the limit of Loans Guarantees orInvestments under Section 186 of the Companies Act 2013

BOARD MEETINGS

The Board meets at regular intervals to discuss and decide on Company / business policyand strategy apart from other Board business. The Board / Committee Meetings arepre-scheduled and a tentative annual calendar of the Board and Committee Meetings iscirculated to the Directors in advance to facilitate them to plan their schedule and toensure meaningful participation in the meetings. However in case of a special and urgentbusiness need the Board’s approval is taken by passing resolutions throughcirculation as permitted by law which are confirmed in the subsequent Board meeting.

The Board met 14(Fourteen) times during the financial year. The intervening gap betweenany two meetings was within the period prescribed by the Companies Act 2013. The maximuminterval between any two meetings did not exceed 120 days as prescribed under theCompanies Act 2013. None of the directors is a member in more than ten committees or actsas a Chairman in more than five committees across all companies in which he is a director.

The Composition of the Board and the number of directorships memberships andchairmanship of committees as on March 31 2016 are given below:

Name of director No. of meetings held No. of meetings Attended Last AGM Attended
Mr. Umesh Pravinchandra 10 10 Yes
Parekh
Mr. Heeralal Rambaratram 10 10 Yes
Jaiswar
Mr. Santosh Gangaram 10 10 No
Mohite***
Mr. Sanjay Kumar Naithani** 10 4 No
Mr. Sapna Naithani**** 10 10 No
Mr. Atul Chimanlal Doshi 10 10 Yes
Ms. Falguni Chintan Raval* 10 7 No

*Appointed on 01/06/2015

**Resigned from 01/09/2015

***Resigned from 29/02/2016

****Resigned from 30/08/2016

Name of the Directors DIN Designation / category *No. of Directorship in Boards of other Co. Committee Membership in all Companies Chairmanship in committees where they are members
Mr. Umesh Pravinchandra Parekh 06827077 Non-Executive Director 1 NIL NIL
Mr. Heeralal Rambaratram Jaiswar 06827029 Non-Executive Director 0 NIL NIL
Mr. Santosh Gangaram Mohite*** 02953365 Non-Executive Director 4 NIL NIL
Mr. Sanjay Kumar Naithani** 01660394 Non-Executive Director 11 NIL NIL
Mrs. Sapna Naithani**** 01693883 Non-Executive Director 4 NIL NIL
Mr. Atul Chimanlal Doshi 06826992 Chairman & Managing Director 1 NIL NIL
Ms. Falguni Chintan Raval* 07197547 Executive Director NIL NIL NIL

*Appointed on 01/06/2015

**Resigned from 01/09/2015

***Resigned from 29/02/2016

****Resigned from 30/08/2016

BOARD MEETINGS AND ATTENDANCE

The dates on which the said meetings were held are 10 times on

11/05/2015 30/05/2015 10/08/2015 01/09/2015 30/09/2015 14/11/2015 13/02/2016 20/02/2016
24/02/2016 29/02/2016

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 in the prescribed form MGT-9 is attached as Annexure‘A’ and forms part of this report.

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 asRs.Annexure BRs. 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.

RELATED PARTIES TRANSACTIONS

During the year the transactions with related parties did not occur in the ordinarycourse of business and on arm’s length basis.

BOARD COMMITTEES

The Company has the following Committees of the Board:

• Audit Committee

• Stakeholders Relationship Committee

• Nomination & Remuneration Committee

VIGIL MECHANISM / WHISTLE BLOWER POLICY

In pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013a Vigil Mechanism for directors and employees to report genuine concerns has beenestablished. The Vigil Mechanism Policy has been uploaded on the website of the Company atwww.kapilrajfinanceltd.com under investors/policy documents/Vigil Mechanism Policy link.

INTERNAL FINANCIAL CONTROL

The Company believes that internal control is a necessarily follows the principle ofprudent 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.

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 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 (PreventionProhibition and Redressal) Act 2013"the Company has in place a formal policy forprevention of sexual 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

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.

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:

Mr. Atul Chimanlal Doshi Chairman & Managing Director
Ruchi Bandhari* Company Secretary Compliance Officer
(Resigned as on 29.02.2016)

ACKNOWLEDGEMENT

Your Directors wish to acknowledge all their stakeholders and are grateful for theexcellent support received from the shareholders Bankers Financial InstitutionsGovernment authorities esteemed corporate clients customers and other businessassociates. Your Directors recognize and appreciate the hard work and efforts put in byall the employees of the Company and their contribution to the growth of the Company in avery challenging environment.

Dated: 3 September 2016 By Order and on behalf of the board
Place: Delhi Sd/-
Atul Chimanlal Doshi
Chairman & Managing Director
DIN 06826992
Registered Office:
8/33 III Floor Satbhrava School Marg
W.E.A Karol Bagh
Delhi - 110005