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NRC Ltd.

BSE: 503780 Sector: Industrials
NSE: NRC ISIN Code: INE953C01018
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NRC Ltd. (NRC) - Director Report

Company director report

To The Members

Your Directors present the 68th Annual Report and Audited Accounts of the Company forthe year ended 31st March 2016.

FINANCIAL RESULTS Rs.in lacs
Year ended Year ended
31/03/2016 31/03/2015
Gross Sales - -
Profit before Interest Depreciation and Tax (367) (777)
Interest - -
Profit before Depreciation and Tax (367) (777)
Depreciation (381) (381)
Profit/(Loss) before Exceptional items & Tax (748) (1158)
Exceptional Items (157) -
Taxation - -
Profit/(Loss) After exceptional items and Tax (906) (1158)
Surplus(Deficit) from Previous Year (62438) (54931)
Transitional depreciation and transfer from - (6348)
revaluation reserve
Profit/(Loss) available for Appropriation (63344) (62438)

PERFORMANCE AND PROSPECTS

(a) The lockout declared w.e.f. 15th November 2009 is continuing and is in force.There were no manufacturing operations during the year; however the essential servicesremain in operation.

(b) To generate interest free funds for revival of operations the company entered intoAgreement for sale of its part of land with Raheja Universal P. Ltd. (RUPL) in 2006-07.Subsequently the company was declared a Sick Industrial Undertaking under Sick IndustrialCompanies (Special Provision) Act 1985 (SICA). The Board For Industrial and FinancialReconstruction (BIFR) directed that being a sick Company the land will have to form partof Draft Rehabilitation Scheme (DRS) under Section 18(1)(d) of SICA and appointed PunjabNational Bank (PNB) as Operating Agency (OA) for preparation of DRS u/s. 17(3) of SICA.Series of litigation follows the BIFR Order and culminated in the Hon. Supreme Courtwhich upheld the BIFR Order.

(c) BIFR vide its order dated 22.01.2014 directed the OA to explore possibility ofamicable understanding between the parties on disposal of surplus land. The labour

Union has also filed a write petition for early disposal of surplus land in Hon. Bombayhigh Court which is pending. The OA has yet to file DRS.

(d) The Company plan to recommence the operations as soon as proceeds from the sale ofland under the aegis of BIFR are received and the Rehabilitation Scheme is sanctioned.

DIVIDEND

In view of the unavailability of the profit the Directors regret their inability torecommend any dividend for the year ended 31st March 2016.

SHARE CAPITAL

During the year the company has not issued any shares.

EMPLOYEE STOCK OPTION PLAN

No shares have been allotted under the ESOP till date. The Company has not granted anystock options during the financial year ended 31st March 2016.

SUBSIDIARIES JOINT VENTURE OR ASSOCIATES COMPANIES DURING THE YEAR: The Companyhas no subsidiaries joint ventures. The Details of the associated companies have beendisclosed in the Extract of MGT 9 which is provided as enclosure in this report.

RISK & MITIGATION

The Company has identified various risks faced by the Company from different areas. Asper the provision of the Companies Act 2013 and SEBI(Listing Obligations and DisclosureRequirement ) Regulation2015 the Board has adopted a risk management policy whereby aproper framework is set up. Appropriate structures are present so that risks areinherently monitored and controlled. A combination of policies and procedures attempts tocounter risk as and when they evolve.

TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Your Company did not have any funds lying unpaid or unclaimed for a period of sevenyears. Therefore there were no funds which were required to be transferred to InvestorEducation and Protection Fund (IEPF).

DISCLOSURE OF VARIOUS POLICIES:

The Board has approved various policies in their meeting so that the Committees workeffectively and in accordance with the provisions as stipulated in the Policies. Variouspolicies as approved by the Board are posted in the Website of the Company.

Remuneration Policy

The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. The Remuneration Policy is posted in the Website of the Company.

Risk Management Policy: [Section 134 (3)(N)]

The Company has implemented Risk Management Policy and the Board of Directors hasprepared a comprehensive framework of risk management for assessment of risks and todetermine the responses to these risks so as to minimize their adverse impact on theorganization. The policy as approved by the Board of Directors is uploaded on theCompany's website.

Vigil Mechanism / Whistle Blower Policy

In order to ensure that the activities of the company and its employees are conductedin a fair and transparent manner by adoption of highest standards of professionalismhonesty integrity and ethical behavior the company has adopted a vigil mechanism policy.The aim of the policy is to provide adequate safeguards against victimization of whistleblower who avails of the mechanism and also provide direct access to the Chairman of theAudit

Committee in appropriate or exceptional cases.

Accordingly ‘Whistle Blower Policy' has been formulated with a view to provide amechanism for the Directors and employees of the Company to approach the Ethics Counselloror the Chairman of the Audit Committee of the Company.

The purpose of this policy is to provide a framework to promote responsible and securewhistle blowing. It protects employees willing to raise a concern about seriousirregularities within the Company.

This policy is posted on the website of company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act 2013 and regulation 17 of (ListingObligations and Disclosure Requirement ) Regulation2015 performance evaluation of theBoard it's Committees and the Independent Directors was carried out. The manner in whichthe evaluation is carried out has been explained in the Corporate Governance Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL DIRECTORS

During the year Dr. P.P. Shashtri and Ms Savita Acharya have been reappointed asIndependent Director w.e.f. 30th September 2015. However Dr. P.P. Shashtri has resignedw.e.f. 01.08.2016.

DETAILS KEY MANAGERIAL PERSONNEL:

The following three persons were formally appointed/ designated as Key Managerial

Personnel of the Company in compliance with provisions of Section 203 of the CompaniesAct 2013.

1. Mr.Arun Jain - Managing Director
2. Mr. Mahavir Nalwaya - Chief Financial Officer
3. Mr. Sandip Mavkar - Company Secretary

Declaration by Independent Directors

Necessary declarations have been obtained from all the Independent Directors undersubsection (7) of Section 149 of the Companies Act 2013.

DIRECTORS' RESPONSIBILITY STATEMENT

As required under Section 134 (5) of Companies Act 2013 given below is the Directors'Responsibility Statement;

The Board of Directors state: i) that in the preparation of the Annual Accounts foryear ended 31st March 2016 the applicable accounting standards had been followed alongwith proper explanation relating to material departures if any; ii) that the Directorshad selected such accounting policies and applied them consistently and made judgments andestimates that are reasonable and prudent so as to give a true and fair view of the stateof affairs of the Company at the end of year as on 31st March 2016 and of the loss of theCompany for that period; iii) that the Directors had taken proper and sufficient care forthe maintenance of adequate accounting records in accordance with the provisions of thisAct for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities; iv) that the Annual Accounts for the year ended 31st March 2016 hadbeen prepared on a "going concern" basis. v) that the Directors had laid downproper internal financial controls to be followed by the company and they were adequateand operating effectively and vi) that the Directors had devised proper systems to ensurecompliance with the provisions of all applicable laws and such systems were adequate andoperating effectively.

SAFETY

Adequate safety measures and safe working practices have been implemented to ensuresafety of workforce plant and machinery as well as of the environment.

INDUSTRIAL RELATIONS

Industrial Relations during the year under review continued to remain cordial andpeaceful.

PUBLIC DEPOSITS

The Company has not accepted any deposits from the public under Section 73 of theCompanies Act 2013.

COST AUDIT

Since the plant is not in operation during the year. If required Exemption from theCost Audit is being applied for the year ending 31st March 2016 with the CentralGovernment.

AUDITORS

M/s. Lodha & Co. Chartered Accountants was appointed as Statutory Auditors tohold office from the conclusion of the 68th Annual General Meeting (AGM) to the conclusionof the forthcoming AGM (subject to ratification of the appointment by the members atevery AGM). A proposal for ratification of the appointment of the Statutory Auditors forthe Financial Year

2016-2017 is placed before the Members at the ensuing AGM. The said Auditors have giventheir eligibility certificate in terms of Section 139 of the Companies Act 2013.

AUDITORS REPORT

Management clarifications to the Auditors Qualifications are given in the Notes No.19(III) (4)(a) 19.4(g) 19.6(A) 19.6(L) 19(5) 19(1)(III)(A) are self explationary.

Internal Auditors

M/s V.B.Dalal & Co. Chartered Accountants was appointed as Internal Auditors ofthe company.

Secretarial Auditor

The Board has appointed M/s Ragini Chokashi and Associates Practising CompanySecretary to conduct Secretarial Audit for the financial year 2015 16. The SecretarialAudit Report for the financial year ended March 31 2016 is annexed herewith marked as"Annexure - I" to this Report.

Explanation to the remarks of secretarial Auditors are as under:

Sr. No. Secretarial Auditor's Remark Directors' explanation
1 Company has not submitted shareholding pattern to exchange as required under Regulation 31(1) (b) of SEBI (LODR) Regulation2015 for the quarter ended on March 2016. On account of huge losses and negative net worth and financial crunch payment to NSDL and CDSL and RTA could not be made. Hence shareholding pattern could not be obtained and filed.
2 Company has not submitted reconciliation of Share Capital Audit to the exchange as required under Regulation 55A of SEBI (Depositories and Participants) Regulation 199 for the quarter ended on March 2016. On account of huge losses and negative net worth and financial crunch payment to NSDL and CDSL and RTA could not be made. Hence report on share capital audit could not be obtained and filed.
3 Company has not submitted Statement of grievance as per regulation 13(3) of SEBI (LODR) Regulation 2015 for the quarter ended on March 2016. On account of huge losses and negative net worth and financial crunch payment RTA could not be made. Hence statement of grievances could not be obtained and filed.
4 Company has not submitted Compliance certificate to exchanges as required under Regulation 7 of SEBI (LODR) Regulation 2015 for the half year ended on 31/03/2016 On account of huge losses and negative net worth and financial crunch payment RTA could not be made. Hence complaisance certificate could not be obtained and filed
5 The company has not paid Listing fees to Stock Exchanges and annual custody fee to NSDL & CDSL On account of huge losses and negative net worth there was financial crunch. Hence listing fee could not be paid

Corporate Social Responsibility

Lockout declared w.e.f. 15th November 2009 is still continuing and is in force due towhich operation of the company is stalled except essential services. The company hasincurred losses over the years. Due to average net profit of last three years beingnegative your

Company has not formed the CSR committee and is not required to spend any amount of CSRactivities during the year. Formation of CSR committee is under review.

Related Party Transaction

There were no contracts or arrangements entered into by the company in accordance withprovisions of section 188 of the Companies Act 2013. All material related partytransactions that were entered into during the financial year were on an arm's lengthbasis and were in the ordinary course of business. There are no materially significantrelated party transactions made by the Company with Promoters Directors Key ManagerialPersonnel or other designated persons which have a potential conflict with the interest ofthe Company at large. Thus disclosure in Form AOC-2 is not required.

None of the Directors has any pecuniary relationships or transactions vis--vis thecompany. Suitable disclosure as required by the Accounting Standard (AS 18) has been madein the notes to the Financial Statements. The policy on Related Party Transactions asapproved by the Board is being uploaded on the Company's website.

MATERIAL CHANGES AND COMMITMENTS OCCURRED BETWEEN THE END OF FINANCIAL YEAR UNDERREVIEW AND THE DATE ON THIS REPORT.

No material changes and commitments have occurred between the end of the financial yearunder review and the date of this report..

Internal financial Control system and their adequacy

The Company has in place internal financial control systems commensurate with the sizeand complexity of its operations to ensure proper recording of financial and operationalinformation and compliance of various internal controls and other regulatory and statutorycompliances.

Audit Committee

The Audit Committee comprises Independent Directors namely Ms. Savita AcharyaDr.P.P.Shastri as Member and Mr. Arun Jain as Member. During the year there are noinstances where the Board had not accepted the recommendations of the Audit Committee.

Risk Management

The Audit Committee has also been delegated the responsibility for monitoring andreviewing risk management assessment and minimization procedures developingimplementing and monitoring the risk management plan and identifying reviewing andmitigating all elements of risks which the Company may be exposed to. The Board alsoreviews the risk management assessment and minimization procedures. Further in accordancewith Regulation 21 of SEBI (Listing Obligations and Disclosure Requirement) Regulation2015 a risk management Committee has also been formed which also oversees the riskmanagement of the Company.

Vigil Mechanism

The Vigil Mechanism of the Company which also incorporates a whistle blower policy interms of the Listing Agreement includes an Ethics & Compliance Task Force comprisingof Directors senior executives of the Company. Protected disclosures can be made by awhistle blower through an e–mail or on telephone line or a letter to the Task Forceor to the Chairman of the Audit Committee.

Meetings of the Board

Five meetings of the Board of Directors were held during the year. For further detailsplease refer report on Corporate Governance of this Annual Report. Particulars of Loansgiven Investments made Guarantees given and Securities provided During the year theCompany has not given loans directly or indirectly to any person or other body corporateor given any guarantee or provided any security in connection with a loan to any otherbody corporate or person. The details of the investments covered under the provisions ofSection 186 of the Companies Act 2013 are given in the Financial Statements.

STATEMENT PURSUANT TO SECTION 134(3)(M) OF THE COMPANIES ACT2013 READ WITH RULE 8(3)OF THE COMPANIES (ACCOUNTS) RULES2014 ON CONSERVATION OF ENERGY TECHNOLOGY ABSORPTIONFOREIGN EXCHANGE EARNINGS & OUTGOINGS

Since the plant is not in operation during the year the information on the energyconservation and technology absorption by the company and foreign exchange earnings andoutgo as required under rule 8(3) of the Companies (Accounts) Rules 2014 are notprovided.

Extract of Annual Return

Form MGT-9 providing extract of the Annual return in terms of Section 92 of theCompanies Act 2013 and the rules made there under is annexed as Annexure II to thereport.

MATERIAL ORDERS PASSED BY THE REGULATORS / COURTS / TRIBUNALS:

There are no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and company's operations in future.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act 2013 read withRule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 and forming part of the Directors' Report for the year ended 31st March 2016is as follow.

The information required under Section 197 of the Companies Act 2013 read with Rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014are given below: (i) The ratio of the remuneration of each director to the medianremuneration of the employees of the company for the financial year;

As Directors are not paid any remuneration except the sitting fees hence this clauseis not applicable.

(ii) the percentage increase in remuneration of each director Chief Executive OfficerChief Financial Officer Company Secretary in the financial year;

Directors* Chief Executive Officer Chief % increase in the remuneration in
Financial Officer and Company Secretary the financial year
Mr. Arun Jain Managing Director Nil
Mr. Mahavir Nalwaya CFO Nil
Mr. Sandip Mavkar Company Secretary N.A.*

* Since Mr Sandip Mavkar Company Secretary has been appointed on 01.07.2015 hence notapplicable.

(iii) The percentage increase in the median remuneration of employees in the financialyear: Nil (iv) The number of permanent employees on the rolls of company: 2138 (v) averagepercentile increase already made in the salaries of employees other than the managerialpersonnel in the last financial year and its comparison with the percentile increase inthe managerial remuneration and justification thereof and point out if there are anyexceptional circumstances for increase in the managerial remuneration;

The average annual increase was around - Nil

(vi) The key parameters for any variable component of remuneration availed by thedirectors; Nil

(vii) Affirmation that the remuneration is as per the remuneration policy of thecompany

The Company affirms that the remuneration is as per the remuneration policy of the

Company.

(viii) Mr. Arun Jain Managing Director whose Managerial Remuneration was 181.74 Lacper annum as approved by the members in earlier. There are no other employees employedthroughout the year were in receipt of remuneration of 102 lacs per annum or more or Rs.8.5 lacs per month if employed for the part of the year.

Environment and Pollution Control

Top priority continues to be given to preservation of the environment by all the unitsof the Company. To combat pollution and strengthen the area ecology considerable emphasisis placed on plantation of fragrant and shady trees which shall protect and promote theenvironment by complying with applicable environmental regulations and preventingpollution in all its operations.

MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT

In compliance with regulation 34(2) (e) of SEBI( Listing Obligations and disclosureRequirements) Regulations2015 a separate section on Management Discussions and AnalysisReport which also includes further details on the state of affairs of the Company andCorporate Governance as approved by the Board of directors forms pats of this report.

REPORT ON CORPORATE GOVERNANCE

A report on Corporate Governance along with Compliance Certificate from the Practicing

Company Secretaries forming part of this report is attached herewith.

Disclosure pursuant to the Sexual Harassment of Women at Workplace (Prevention

Prohibition and Redressal) Act 2013.

As per the provisions of the Sexual Harassment of Women at Workplace (Prevention

Prohibition and Redressal) Act 2013 the Company has constituted Committees in thename of "Internal Complaints Committee" for the Registered Office & Units ofthe Company. During the Financial Year 2015-16 there were no cases filed under the saidAct.

MANAGING DIRECTOR/ CHIEF FINANCIAL OFFICER COMPLIANCE CERTIFICATE

Certificate by the Managing director and Chief Financial Officer pursuant to Regulation

17(8) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 forthe financial year ended 31st march2016 is provided in Corporate Governance Report.

GENERAL

Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:1. Issue of equity shares with differential rights as to dividend voting or otherwise.

2. Issue of shares (including sweat equity shares) to employees of the Company underany scheme save and except ESOS referred to in this Report.

WEBSITE OF THE COMPANY

The Company maintains a website www.nrclimited.com where detailed information of thecompany and its products are provided.

ACKNOWLEDGEMENTS

Your Company and its Directors acknowledge with gratitude the support received from theGovernment Agencies Financial Institutions Banks Investors Business Associates andEmployees of the Company and look forward to their continued support.

For and on behalf of the Board of Directors
Place: Mumbai G. P. GOENKA
Date: 10th November 2016 Chairman