Quantum Build-Tech Limited
1. INTRODUCTION :
Your Directors have pleasure in presenting Nineteenth Annual Report on the Business andoperations of the Company together with the Audited Financial statements for the yearended on 31st March 2017.
2. FINANCIAL RESULTS:
The financial performance of the Company for the year ended 31st March2017 is summarized below:
|Particulars ||Year ended on 31.03.2017 ||Year ended on 31.03.2016 |
|Turnover ||30389724 ||25965925 |
|Profit/ (Loss) before Taxation ||(17269117) ||(112363) |
|Less: Tax Expenses || || |
|i.) Current Year || || |
|ii.) Provision for Income tax for Earlier years ||18261 || |
|Profit/ (Loss) after tax ||(17287378) ||(112363) |
|Profit/(Loss) C/F to the Next Year ||(17287378) ||(112363) |
3. STATE OF AFFAIRS OF THE COMPANY AND FUTURE OUTLOOK:
During the period under review the turnover of the Company has increased about 14.55%as against that of the previous year but the losses have increased due to reducedContracts.
The infrastructure sector has been showing signs of recovery which is likely tofurther acquire momentum in the medium term with the positive proposals in the UnionBudget 2017-2018. Overall as the new regulatory framework is rolling out and theGovernment is taking initiatives for revival of Real Estate business the market scenarioseems to be resurgent. Your Directors are optimistic about Company's future and hope toreap more revenues in coming years to mitigate losses.
During the year the Company and PNB Housing Finance Limited had agreed for Full andFinal Settlement for repayment of Outstanding Loan. The said Bank has issued a NoObjection Certificate (NOC) on 23rdJanuary 2017 and the charge was satisfiedupon the payment. Likewise the Company has entered into a Memorandum of Understanding(MoU) with Axis Bank Limited on 23rd March 2017 for One Time Settlement ofoutstanding Loan.
Your Company is in the process of redeeming 200000- 13% Cumulative RedeemablePreference Shares of Rs. 100/ - each which were due for redemption since 2008. Due tolosses and adverse market condition in the real estate sector the Company was not in aposition to redeem the same.
However the Board has planned to resolve the above matters which would enabletheCompany to show the actual financial position in the Balance Sheet the representingAssets value which will facilitate the Company to approach Banks and other institutionsfor financial assistance to revive and develop the business of the Company.
4. CHANGE IN NATURE OF BUSINESS:
During the year under review there was no change in the nature of business of theCompany.
During the period under review the Company has not been able to earn profits so as toreward the shareholders. Therefore your directors do not recommend any dividend for theyear under review.
6. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND:
The provisions of Section 125(2) of the Companies Act 2013 do not apply as the Companyhas not declared and paid dividend.
7. AMOUNT TRANSFERRED TO RESERVES:
The amount to be carried forward to the Balance Sheet for the period under review isRs. (17287378)/-
8. SHARE CAPITAL:
The Paid up Share capital of your Company is Rs. 146156300/- divided into12615630 Equity Shares of Rs. 10/ - each with Voting Rights and 200000 13%Cumulative Redeemable Preference Shares of Rs. 100/- each which are unlisted shares.
During the year under review there is no change in the Share Capital of the Company.
a. Provision of money by company for purchase of its own shares by employees or bytrustees for the benefit of employees:
The company has not made any provision of money for purchase of its own shares byemployees or by trustees for the benefit of employees as per Rule 16(4) of Companies(Share Capital and Debentures) Rules 2014.
b. Issue of Sweat Equity Shares:
The Company has not issued any sweat equity share during the financial year inaccordance with the provisions of Section 54 of Companies Act 2013 read with Rule 8 ofthe Companies (Share Capital and Debentures) Rules 2014.
c. Issue of Equity Shares with Differential Voting Rights:
The Company has not issued any equity shares with differential voting rights during thefinancial year as per Rule 4(4) of Companies (Share Capital and Debentures) Rules 2014.
d. Issue of Employee Stock Option:
The Company has not issued any employee stock option during the financial year as perRule 12 of Companies (Share Capital and Debentures) Rules 2014.
9. PUBLIC DEPOSITS:
The Company has neither accepted nor renewed any deposits from Public within themeaning of Section 73 of the Companies Act 2013 read with Companies (Acceptance ofDeposits) Rules 2014 during the year.
10. ANNUAL RETURN:
The extracts of the Annual Return pursuant to the provisions of Section 92(3) of theCompanies Act 2013 read with Rule 12 of the Companies (Management and Administration)Rules 2014 in Form No. MGT-9 is enclosed herewith as "Annexure I".
Your Board consist of Six Directors including Three Independent Non- ExecutiveDirectors. The declaration from all the Independent Directors are being obtained both atthe time of appointment and at the First Board meeting of each Financial Year.
Smt. Kodali Vijaya Rani being a Director liable to retire by rotation in the ensuingNineteenth Annual General Meeting and being eligible offers herself for re-appointment.Her Profile is appended to the Notice.Your Board recommends her re-appointment.
During the year under review the Board appointed Ms. Shivani Sarda an Associatemembers of the Institute of Company Secretaries of India as Company Secretary andCompliance Officer of the Company as per Section 203 of the Companies Act 2013 and SEBI(Listing Obligations andDisclosure Requirements) Rules 2015.
The term of Shri Guduru Satyanarayana as the Managing Director of the Company is aboutto conclude. Considering his experience and expertise in the business of the Company andon the recommendation of Nomination and Remuneration Committee the Board recommends there-appointment of Shri Guduru Satyanarayana as the Managing Director for a period of fiveyears with effect from 01.09.2017 in accordance with Section 196 of the Companies Act2013 on revised terms of remuneration.
Further the term of office of Shri Manne Rambabu as Director (Technical) of theCompany is about to complete. Keeping in view his experience and contribution in thedevelopment of the Company and on the recommendation of Nomination and RemunerationCommittee the Board recommends the re-appointment of Shri Rambabu Manne as Director(Technical) for a period of five years effective from 01.09.2017 on the same terms ofremuneration. On the recommendation of the Nomination and Remuneration Committee theBoard has approved the appointment of Mr. Kanduri Saraswathi Kumar as an IndependentDirector of the Company for a period of Five years effective from the ensuing AnnualGeneral Meeting subject to the consent of the members. Mr. Kanduri Saraswathi Kumarnon-executive director of the Company has given a declaration to the Board that he meetsthe criteria of independence as provided under Section 149(6) of the Act. The Boardrecommends his appointment.
A. Board Meetings:
During the year under review the Board of Directors met Seven times and thedates of the Board Meetings are: 05.05.2016 30.05.2016 11.08.2016 26.08.201611.11.2016 13.02.2017 and 23.03.2017. The details of the Meetings of Board are covered inthe Corporate Governance Report.
B. Key Managerial Personnel (KMPs):
In compliance with the requirements of Section 203 of the Companies Act 2013following are the Key Managerial Personnel of the Company:
|1. Mr. Satyanarayana Guduru ||- Managing Director |
|2. Mr. Manne Rambabu ||- Whole Time Director (Technical) |
|3. Mr.M.R. Koteswara Rao ||- Chief Financial Officer |
|4. Ms. Shivani Sarda ||- Company Secretary and Compliance Officer. |
However Ms. Shivani Sarda resigned from the position of Company Secretary andCompliance officer of the Company on 10.04.2017. The Board places on record appreciationfor the services and contribution made by her during her tenure.
Your Board has subsequently inducted Ms. Payal Bang an associate member of theInstitute of Company Secretaries of India (ICSI) bearing Membership No. A49439 as theCompany Secretary and Compliance officer of the Company w.e. 11.08.2017.
C. Declaration by Independent Directors:
In accordance with Sub-section (7) of Section 149 of the Companies Act2013(hereinafter called as "The Act") the Independent Directors on your Boardhave given a Declaration that they meet the criteria of Independence as provided in subsection (6) of Section 149 of the Act. There has been no change in terms and conditions ofappointment of Independent Directors the Policy relating to their appointment can beaccessed through weblink as - http://wwwquantumbuild.com/images/pdf/t-and-c-of-appt-of-id-2015.pdf
D. Board Evaluation:
The Board of Directors has carried out an Annual Evaluation of its own performance andhas devised a Policy on Evaluation of performance of Board of Directors Committees andIndividual Directors pursuant to the provisions of the Act the Corporate Governancerequirements and as prescribed by Regulation 25 of Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015.
The Extract of the Policy on Evaluation of Performance of the Board its Committees andindividual Directors is available on the website of the Company the web link for whichis- http: //wwwquantumbuild.com/images / pdf/ bo ard-evaluation-policy-14-08-2014.pdf Evaluationby Independent Directors:-
In a separate meeting of independent directors held on 05.01.2017 the performance ofnon-independent directors performance of the Board as a whole and performance of theChairman was evaluated taking into account the views of Executive directors andnon-executive directors. The same was discussed in the Board meeting that followed atwhich the performance of the Board its Committees and individual directors was alsodiscussed.
The performance of the Board as a whole was evaluated by the Independent Directorsafter seeking inputs from all the directors on the basis of the criteria such as theBoard's composition structure effectiveness of Board processes information andfunctioning etc.
The Independent Directors reviewed the performance of the individual directors on thebasis of the criteria such as the contribution of the individual director to the Boardlike preparedness on the issues to be discussed meaningful and constructive contributionand inputs in meetings etc. In addition the Chairman was also evaluated on the keyaspects of his role.
Evaluation by Board (Other than Independent Directors):-
In accordance with Regulation 17(10) of SEBI Listing Regulations the entire Board ofDirectors of the Company shall evaluate the performance of Independent Directors of theCompany.Performance evaluation of Independent Directors was done by the entire Boardexcluding the Independent Director being evaluated.
E. Managerial Remuneration:
The details of Remuneration paid to the Directors Key Managerial Personnel andEmployees as required under Section 197(12) of the Companies Act 2013 read with Rule 5 ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are givenin Form MGT-9 forming part of the Directors' Report and also in the Corporate GovernanceReport.
A statement on the Ratio of the remuneration of each director to the medianremuneration of the employees of the Company and the related remuneration is NA.
12. DIRECTORS' RESPONSIBILITY STATEMENT:
In accordance with the provisions of Section 134(5) of the Act your directors to thebest of their knowledge and ability confirm that:
a) In the preparation of the annual accounts for the Financial Year ended 31stMarch 2017 the applicable accounting standards had been followed along with properexplanation relating to material departures;
b) The directors had 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 as at 31stMarch 2017 and ofthe loss of the Company for that period;
c) The directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) The directors had prepared the annual accounts on a going concern basis;
e) The directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively;
f) The directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively.
13. DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THEFINANCIAL STATEMENTS:
The Company has Internal Financial Controls which are adequate and were operatingeffectively. The controls are adequate for ensuring the orderly and efficient conduct ofthe business including adherence to the Company's policies the safe guarding of assetsthe prevention and detection of frauds and errors the accuracy and completeness ofaccounting records and timely preparation of reliable financial information. The detailsin respect of Internal Financial Controls are included in the Management Discussion andAnalysis Report which forms part of the Annual Report.
14. STATUTORY AUDITORS:
Pursuant to Section 139 of the Companies Act 2013 and the resolutions passed by themembers in the 16th Annual General Meeting of the Company the term of M/s.Rambabu & Co. Chartered Accountants (Firm Registration No. 002976S) as the StatutoryAuditors of the Company shall conclude at the ensuing Annual General Meeting.
As per the provisions of Section 139(2) of the Act and the recommendation of the AuditCommittee your Boardproposes to appoint M/s Suryanarayana & Suresh CharteredAccountants (Firm Registration No. 006631S) as Statutory Auditors of the Company from theconclusion of this Annual General Meeting till the conclusion of the Twenty Fourth AnnualGeneral Meeting of the Company. Accordingly the Company has received consent from them tothe effect that their appointment if made would be within the limits prescribed underSection 141 of the Act. The Board recommends their appointment.
15. SECRETARIAL AUDIT:
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hadappointed Shri Ajay Suman Shrivastava Practicing Company Secretary Hyderabad toundertake the Secretarial Audit of the Company for the financial year 2016-17 and certifythe same for the Company.
The Secretarial Audit Report is provided as Annexure II' to thisreport.
16. EXPLANATION TO THE QUALIFICATIONS/ RESERVATIONS/ ADVERSE REMARKS IF ANY MADE BYSTATUTORY AUDITORS AND SECRETARIAL AUDITOR IN THEIR REPORT:
The explanation of the Board to the qualifications and/or reservations made byStatutory Auditors in their report are as follows:
i. Reference is invited to Note 3.1.1 of the Financial Statement:
Since the profits of the Company are not sufficient to pay the dividend on 13%Cumulative Redeemable Preference Shares. Hence the Company has not made provisions forPreference dividend since 2008.
ii. Reference is invited to Note 5.1 of the Financial Statement:
Axis Bank Ltd. Had filed a case against the Company in the Hon'ble Debt RecoveryTribunal for recovery of debts vide Case Reference No. OA.No.436 of 2013 and the Companyalso filed a case against Axis Bank Ltd. Vide Case Reference No. SA.48 of 2012 and it ispending before the Hon'ble Debt Recovery Tribunal during the period under review. Duringthe year the Company has entered into MOU with Axis Bank Limited for settlement ofoutstanding Loan.
iii. Reference is invited to Note 13.1 of the Financial Statement:
The Company has initiated the proceedings to recover the said dues and the same arepending. However the management is confident of recovering the same.
17. DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNAL:
During the year under review there has been no significant and material orders passedby any regulators or courts or tribunal.
18. PARTICULARS OF EMPLOYEES:
There are no employees drawing remuneration as prescribed under Section 197 of theCompanies Act 2013. Hence the details are NIL.
19. ANTI SEXUAL HARASSMENT POLICY:
Your Company has female employees and the Company has meagre staff/ employees are andmostly mobile in nature hence there lies no question of sexual harassment and neitherany complaints has received.
However the Company adopts the Policy on prevention prohibition and redressal ofsexual harassment at workplace in line with the provisions of the Sexual Harassment ofWomen at work place(Prevention Prohibition and Redressal) Act 2013 and the Rulesthereunder.
20. RISK MANAGEMENT:
The management has put in place effective and robust system for the purposes ofidentification and mitigation of risks involved in the business of the Company. Majorrisks identified by the businesses and functions are systematically addressed throughmitigating actions on a continuing basis. The Audit Committee has additional oversight inthe area of financial risks and controls.
In the opinion of the Board following are risks involved in the industry:
a. Level of Competition;
b. Fluctuation in prices of raw-materials; c Availability of skilled manpower;
d. Tax structure
21. ESTABLISHMENT OF VIGIL MECHANISM:
In accordance with Regulation 22 of SEBI (Listing obligations and DisclosureRequirements) Regulations 2015 the Company has formulated and established vigilmechanism for directors and employees to report concerns about unethical behavior. Noperson has been denied access to the Chairman of the Audit Committee. The said policy hasbeen made available on the website of the Company at the following link i.e. http://www.quantumbuild.com/images /pdf/vigil-mechanism-policy.pdf.
22. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
All transactions entered into with related parties as defined under Section 2(7 6) ofthe Companies Act 2013 were in the ordinary course of business and do not attract theprovisions of Section 188 of the Companies Act 2013. The Company has also complied withRegulation 23 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015during the Financial Year 2016-17. There were no materially significant transactions withrelated parties in the Financial Year which were in conflict with the interest of theCompany and requiring compliance of the provisions of Regulation 23 of SEBI ListingRegulations. The requireddisclosure as per the Accounting Standard-18 (AS-18) has beenmade by the Auditors in the notes forming part of the Financial Statements.
Since there are no contracts or arrangements with Related parties no disclosure isrequired under Section 188 of the Act.
23. CORPORATE SOCIAL RESPONSIBILITY (CSR):
During the financial year under review the Company's performance does not attract theprovisions set out under Section 135 of the Companies Act 2013 read with rules madethereunder.Hence the compliances to the provisions of Section 135 of the Companies Act2013 read with Companies (Corporate Social Responsibility Policy) Rules 2014 are notrequired.
24. CORPORATE GOVERNANCE:
Corporate governance is concerned about maximizing shareholder value legally ethicallyand sustainably. The goal of corporate governance is to ensure fairness for everystakeholder.The Board of Directors of the Company opine that sound corporate governance iscritical to enhance and retain investor trust.
The Company has adopted a Code of Conduct for its employees including the ManagingDirector and the Executive Directors. The said Code of Conduct is available on Company'sWebsite at the web link -
A report on Corporate Governance covering amongst other details of Meetings of theBoard and Committees along with a Certificate for compliance with the Corporate Governancerequirements of Regulations 17 to 27 read with Schedule V and clauses (b) to (i) ofRegulation 46(2) of SEBI (LODR) Regulations 2015 as applicable with regard to CorporateGovernance issued by Shri Ajay Suman Shrivastava Practicing Company Secretary formspart of the Annual Report.
25. POLICY ON DIRECTORS' APPOINTMENT REMUNERATION AND DISCHARGE OF THEIR DUTIES:
Your Company has a duly constituted Nomination and Remuneration Committee of Directorsin accordance with the requirements of Section 178 of the Companies Act 2013 read withRegulation 19 of SEBI (LODR) Regulations 2015. The Nomination and Remuneration Committeeof your Board had fixed various criteria for nominating a person on the Board which interalia include desired size and composition of the Board age limits qualification/experience areas of expertise and independence of individual.
26. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THECOMPANIES ACT 2013:
There were no loans given guarantees provided or investments made by the Company underSection 186 of the Companies Act 2013 during the financial year under review
27. SUBSIDIARY HOLDING ASSOCIATE COMPANIES AND JOINT VENTURES:
The Company does not have any Subsidiary Holding Joint Venture or Associate Company.
28. MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTSRELATE AND THE DATE OF THE REPORT:
No material changes and commitments affecting the financial position of the Companyoccurred between the end of the financial year to which these financial statementsrelatetill the date of this report.
29. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:
The information pertaining to conservation of energy technology absorption foreignexchange earnings and outgo as required under Section 134(3) (m) of the Companies Act2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 are as follows:
|1. ||The steps taken or impact on conservation of energy. ||Your Company being a service provider requires minimal energy consumption and every endeavor is made to ensure optimal use of energy avoid wastages and conserve energy as far as possible. |
|2. ||The steps taken by the company for utilizing alternate sources of energy. |
|3. ||The capital investment on energy conservation equipment's. |
|1. ||The effors made towards technology absorption. ||Since the Company is not engaged in any manufacturing the information in connection with technology absorption is NIL. |
|2. ||The benefits derived like product improvement cost reduction product development or import substitution. |
|3. ||In case of imported technology (imported during the last three years reckoned from the beginning of the financial year)-- the details of technology imported the year of import;- whether the technology been fully absorbed:- if not fully absorbed areas where absorption has not taken place and the reasons thereof. |
|4. ||The expenditure incurred on Research and Development. ||NIL |
FOREIGN EXCHANGE EARNINGS AND OUTGO:
Particulars of foreign currency earnings and outgo during the financial year are NIL.
The Equity shares of your Company are listed at Bombay Stock Exchange (BSE Ltd.). YourCompany has duly complied with all the requirements of concerned Stock Exchange inaccordance with applicable provisions of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended from time to time.
Your Directors place on record their sincere thanks to bankers business associatesconsultants and various Government Authorities for their continues support extended toyour Company's activities during the year under review. Your Directors also acknowledgegratefully the Shareholders for their support and confidence reposed on the Company.
| || |
For and on behalf of the Board
|Date: 11.08.2017 || || |
|Place: Hyderabad ||Guduru Satyanarayana ||Kodali Vijaya Rani |
| ||Managing Director ||Director |
| ||DIN: 02051710 ||DIN: 00102286 |