Your directors have pleasure in presenting their Twenty-seventh Annual Report on thebusiness and operations of Scintilla Commercial & Credit Limited (the"Company") together with the audited statement of accounts for the year ended31st March 2016.
Financial Highlights (Standalone and Consolidated)
During the year under review performance of your company as under:
| || ||(in Rs.) |
|Financial Result ||Year Ended 31.03.2016 ||Year Ended 31.03.2015 |
|Total Revenue ||26657225 ||15191497 |
|Profit /(Loss) Before Tax ||128734 ||125822 |
|Less: Tax Expenses ||49532 ||105642 |
|Profit /(Loss) After Tax ||79202 ||20180 |
|Balance carried to Balance Sheet ||1437473 ||1379177 |
The consolidated performance of the group as per consolidated financial statements isas under:
| || ||(in Rs.) |
|Financial Result ||Year Ended 31.03.2016 ||Year Ended 31.03.2015 |
|Total Revenue ||27604248 ||16014403 |
|Profit /(Loss) Before Tax ||255252 ||274074 |
|Less: Tax Expenses ||67883 ||108612 |
|Share of Profit / (Loss) transferred to Minority Interest ||45045 ||57587 |
|Balance Profit / (Loss) C/F to the next year ||1659894 ||1542739 |
Operating & Financial Performance
The Standalone Gross revenues increased to Rs. 26657225/- a growth of around 75.47 %against Rs. 15191497/- in the previous year. Profit before taxation was Rs. 128734/-against Rs. 125822/- in the previous year. The percentage of profit has increased by 2.31%due to increase in income from sale of shares and securities. After providing for taxationof Rs.49532/- & Rs. 105642/- respectively the net profit of the Company for the yearunder review was placed at Rs. 79202/- as against Rs. 20180/- in the previous year. And
The Consolidated Gross revenues increased to Rs. 27604248/- a growth of around 72.31 %against Rs. 16014403/- in the previous year. Profit before taxation was Rs. 255252/-against Rs. 274074/- in the previous year. The percentage of profit has decreased by 6.87%due to increase in expenditure for purchase of shares and stocks. After providing fortaxation of Rs.67883/- & Rs. 108612/- respectively the net profit of the Company forthe year under review was placed at Rs. 45045/- as against Rs. 57587/- in the previousyear.
With the view to conserve the resources of company your directors regret to recommendany dividend for the period under report.
The paid up Equity Share Capital as on March 31 2016 was Rs. 100277770. During theyear under review the company has not issued any shares or any convertible instruments.
Change in the nature of business if any
There is no change in the nature of the business of the Company.
Statutory & Legal Matters
There has been no significant and/or material order(s) passed by anyRegulators/Courts/Tribunals impacting the going concern status and the Companysoperations in future.
Material Changes & Commitments occurring after the end of Financial Year
No material changes and/or commitments affecting the financial position of the Companyoccurred between the end of the financial year to which the attached financial statementsrelate to and up to the date of this report.
Subsidiary / Joint Ventures / Associates
As on March 31 2016 the Company had two Indian subsidiaries. During the year underreview Janhit Tracom Limited has ceased to be the subsidiary but there has been no changein the nature of business of the other two subsidiaries In accordance with Section 129(3)of the Companies Act 2013 the Company has prepared a consolidated financial statement ofthe Company and all its subsidiary companies which is forming part of the Annual Report.A statement containing salient features of the financial statements of the subsidiarycompanies in the prescribed format AOC 1 is also included in the Board Report and isattached as ANNEXURE-I In accordance with third proviso of Section 136(1) of theCompanies Act 2013 the Annual Report of the Company containing therein its standaloneand the consolidated financial statements has been placed on the website of the Company www.scintilla.co.in.Further as per fourth proviso of the said section audited annual accounts of each of thesubsidiary companies have also been placed on the website of the Company at www.scintilla.co.in.
Consolidated Financial Statements
The consolidated financial statements prepared in accordance with Accounting Standard21 Consolidated Financial Statements forms part of this report. The Net Worth ofthe consolidated entity as on March 31 2016 stood at Rs. 120556413 as against Rs.121670227 at the end of the previous financial year.
Internal Financial Control
The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weaknesses in the design or operation were observed.
Although the company has long been following the principle of risk minimization as thenorm in every industry it has now become a compulsion. The Board members were informedabout risk assessment and after which the Board formally adopted and implemented thenecessary steps for monitoring the risk management plan for the company.
Directors and Key Managerial Personnel
During the year under review at a meeting of the Board of Directors of the Companyheld on 9th February 2016 took the note of resignation of Ms Bharti Ranga fromthe office w.e.f 2nd February 2016 due to her pre-occupation. Futher on therecommendation of Nomination and Remuneration Committee appointed Miss VishakhaMundhra(DIN : 07382982) as additional independent woman non-exectuive director of theCompany.
In accordance with the provision of Companies Act 2013 Mr. Jitendra Kumar Goyal (DIN: 00468744) Director of the Company retires by rotation and being eligible offers himselffor reappointment. Necessary resolution for Mr. Jitendra Kumar Goyal as a managingdirector of the Company is included in the Notice.
Company Secretary and Compliance Officer
During the year Mr. Rama Kant Mishra Company Secretary and Compliance Officer of theCompany resigned from the services of the Company. The resignation was effective 1stMarch 2016. Consequent to Mr. Rama Kant Mishra resignation the Board appointed Mr. AnandMishra as the Company Secretary KMP and Compliance Officer of the Company with the effectfrom 30th April 2016.
Declaration by Independent Director(s)
The Board of Directors hereby certifies that the Independent Directors appointed on theBoard meet the criteria pursuant to Section 149(6) of the Companies Act 2013.
Further all Independent Directors have furnished their Declarations meeting thecriteria under Section 149(6) of the Companies Act 2013 and Regulation 25 SEBI (Listingand Disclosure Requirement) Regulations 2015
Meetings of Board
During the Financial Year 2015-16 nine (9) meetings of the Board of Directors of theCompany were held. The details of which are given in the Corporate Governance Report. Theintervening gap between the Board Meetings was within the period prescribed under theCompanies Act 2013.
Board Induction Training and Familiarisation programme for Independent Directors
At the time of appointment of the Director a formal letter of appointment is given tohim which inter-alia explains the role functions and responsibilities expected of him asa Director of the Company. The Director is also explained in detail the variouscompliances required from him as a Director under the various provisions of the CompaniesAct 2013 Regulation 25 SEBI(Listing Obligation and Disclosure Requirement) Regulations2015 SEBI(Prohibition of Insider Trading) Regulations 2011 the Code of Conduct of theCompany and other relevant regulations. The Director upon appointment is formallyinducted to the Board. In order to familiarize the Independent Directors about thebusiness drivers they are updated through presentations at Board Meetings about theFinancials of the company and also about the new product launches. They are also providedbooklets about the business and operations of the company.
The Directors are also updated on the changes in relevant corporate laws relating totheir roles and responsibilities as Directors.
Meetings of Independent Directors
A separate meeting of the Independent Directors was held on 9th February 2016. Mr.Vidhu Bhushan Verma was elected as the Lead Independent Director of the Company. Detailsof the separate meeting of the Independent Directors held and attendance of IndependentDirectors are provided in the Report on Corporate Governance forming part of this report.
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and to fixtheir remuneration. The Companys Remuneration Policy is available on theCompany's website at www.scintilla.co.in
Directors' Responsibility Statement
The Board of Directors acknowledges the responsibility for ensuring compliance with theprovisions of section 134(3)(c) read with section 134(5) of the Companies Act for theyear ended on 31.03.2016 and state that :
(i) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures if any;
(ii) 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;
(iii) the directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
(iv) the directors have prepared the annual accounts on a going concern basis;
(v) the directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
(vi) The directors have devised proper system to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
Related Party Transactions
All Related party transactions that were entered into during the financial year were onan arms length basis and in the ordinary course of business. There are no materialsignificant related party transactions made by the Company during the year that would haverequired shareholder approval under Regulation 23 SEBI (Listing Obligation and DisclosureRequirement) Regulations 2015. All related party transactions are reported to the AuditCommittee. Prior approval of the Audit Committee is obtained on a yearly basis for thetransactions which are planned and/ or repetitive in nature and omnibus approvals aretaken within limits laid down for unforeseen transactions. The disclosure under Section134(3) (h) of the Companies Act 2013 read with Rule 8(2) of the Companies (Accounts)Rules 2014 is not applicable. The Policy on Related Party transactions as approved by theBoard has been uploaded on the Companys Website and may be accessed at thelink http://www.scintilla.co.in/policy/DOC_194281.SCC_related_party_policy.pdf
The details of the transactions with related parties during 2015-16 are provided in theaccompanying financial statements.
None of the Independent Directors had any pecuniary relationship or transactions withthe Company during the year under review.
The Nomination and Remuneration Committee of the Company formulated and laid downcriteria for performance evaluation of the Board including the Committee and theindividual director (including Independent Directors) pursuant to provisions of Section134 Section 149 read with Code of Independent Directors (Schedule IV) and Section 178 ofthe Companies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. The manner of performance evaluation followed by the Board is providedin Corporate Governance Report.
Pursuant to the provisions of Companies Act 2013 and Regulation 17 SEBI(Listing andDisclosure Requirement) Regulations 2015the Board has carried out annual performanceevaluation of its own performance the directors individually as well as the evaluation ofthe working of its Committees.
Company is committed to adhere to the highest standards of ethical moral and legalconduct of business operations and in order to maintain these standards the Companyencourages its employees who have genuine concerns about suspected misconduct to comeforward and express these concerns without fear of punishment or unfair treatment. TheCompany has a strong and effective Whistleblower Policy which aims to deter and detectactual or suspected misconduct
This mechanism also provides for adequate safeguards against victimization of employeeswho avail of the mechanism. Any employee may report such incident without fear to theVigilance Officer or alternatively to Chairman of the Audit Committee
The Audit Committee is empowered to monitor the functioning of the mechanism. Itreviews the status of complaints received under this policy. The Committee has in itsReport affirmed that no personnel have been denied access to the Audit Committee. Thedetails of whistle blower policy is posted on the website of the Company and can beaccessed at www.scintilla.co.in
Corporate Social Responsibility
The provisions of Companies Act 2013 regarding Corporate Social Responsibility are notapplicable to the Company.
The shares of the Company are listed on the BSE Limited and Calcutta Stock ExchangeLimited. The Company's shares are compulsorily traded in the dematerialized form. The ISINallotted is INE892C01018.
The Securities and Exchange Board of India (SEBI) on September 2 2015 issued SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 with the aim toconsolidate and streamline the provisions of the Listing Agreement for different segmentsof Capital markets to ensure better enforceability. The said regulations were effectivefrom December 1 2015. Accordingly all listed entities were required to enter into theListing Agreement within Six Months from the Effective date. The Company entered into newListing Agreement with Bombay Stock Exchange Ltd & Calcutta Stock Exchange Ltd duringthe financial year.
M/s. S. K. Rungta & Co. Chartered Accountants (FRN: 308081E) Kolkata wasappointed as Statutory Auditors of the Company from the conclusion of the Annual GeneralMeeting held on 29.09.2014 until the conclusion of 28th Annual General Meeting to be heldin the year 2017. The Company has received a certificate from the above Auditors to theeffect that if they are reappointed it would be in accordance with the provisions ofSection 141 of the Companies Act 2013. Their continuance of appointment and payment ofremuneration are to be confirmed and approved in the ensuing Annual General Meeting.
The Auditors report for fiscal 2016 does not contain any qualification reservation oradverse remark. The Auditors Report is enclosed with the financial statementsin this Annual Report.
Auditors Certificate on Corporate Governance
As required by SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015the auditors certificate on corporate governance is enclosed as ANNEXURE-IVto the Boards report.
Mr. Anand Khandelia Practicing Company Secretary was appointed to conduct thesecretarial audit of the Company for the financial year 2015-16 as required under Section204 of the Companies Act 2013 and Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014.
In terms of the provisions of Section 204(1) of the Company Act 2013 a SecretarialAudit Report in Form MR-3 given by Secretarial Auditor is annexed to this Report (ANNEXURE-III).The Report confirms that the Company had complied with the statutory provision listedunder Form MR-3 and the Company also has proper board processes and compliance mechanism.The Secretarial Audit Report doesnot contain any qualification reservation or adverseremark.
The Report confirms that the Company had complied with the statutory provision listedunder Form MR-3 and the Company also has proper board processes and compliance mechanism .The Secretarial Audit Report does not contain any qualification reservation or adverseremark.
Code of Conduct
The Board of Directors has approved a Code of Conduct which is applicable to theMembers of the Board and all employees in the course of day to day business operations ofthe company. The code laid down by the Board is known as "code of businessconduct" which forms an Appendix to the Code. The Code has been posted on the Companyswebsite www.scintilla.co.in.
All the Board Members the Senior Management personnel and personnel one level belowthe Board have confirmed compliance with the Code. All Management Staff were givenappropriate training in this regard.
Internal Control Systems and Their Adequacy
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The scope and authority of the Internal Audit function isdefined in the Internal Audit Manual. To maintain its objectivity and independence theInternal Audit function reports to the Chairman of the Audit Committee of the Board &to the Director.
The Company being a Non deposit taking NBFC has not accepted any public deposits and assuch no amount on account of principal or interest on public deposits was outstanding ason the date of the balance sheet.
Loans guarantees and investments
The Company has not given any loans or guarantees covered under the provisions ofsection 186 of the Companies Act 2013.The detail of the investments made by the Companyare given in the notes to the financial statements.
Conservation of Energy Technology Absorption
Since the Company does not own any manufacturing facility being an Investment Companythe particulars relating to conservation of energy and technology absorption stipulated inthe Companies (Accounts) Rules 2014 are not applicable.
Foreign Exchange Earning and Outgo
There is no foreign exchange earnings and outgo during the year under review.
Extract of Annual Return
The extract of Annual Return as for the financial year 2015-2016 in Form No. MGT-9 asrequired under Section 92(3) of the Companies Act 2013 read with Rule 12 of the Companies(Management and Administration) Rules 2014 is set out as an annexure to this Report. (ANNEXUREV).
The information required pursuant to Section 197(12) read with Rule 5(1) of TheCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect ofemployees of the Company is attached here as ANNEXURE VI and forms a part of theDirectors Report.
There are no employees who are in receipt of remuneration in excess of the limitspecified under section 134(3) (q) read with Rule 5 (2) and 5 (3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014.
RBI Guidelines for Non-Banking Financial Companies
The Company has observed all the prudential norms prescribed by the Reserve Bank ofIndia. The Schedule as required in terms of Paragraph 13 of Non-Banking FinancialCompanies Prudential Norms (Reserve Bank) Directions 2015 is annexed herewith.
Provisions of Sexual Harassment
The provisions of the Sexual Harassment of Women at the work place (PreventionProhibition and redressal) Act 2013 is not attracted on the Company However the Companyhas a voluntary policy towards Prevention of Sexual Harassment of Women employees of theCompany and has set up a mechanism for registering and prompt redressal of complaintsreceived from all permanent and temporary employees and staffs.
The statements forming part of the Directors Report may contain certainforward looking remarks within the meaning of applicable securities laws and regulations.Many factors could cause the actual results performances or achievements of the Companyto be materially different from any future results performances or achievements that maybe expressed or implied by such forward looking statements
Your Directors take the opportunity of placing their sincere appreciation to theCentral Government State Government Banks Financial Institutions employeesassociates consultants and members of the company for their valuable guidance andsupport. The Board expects to receive there continued support in the future as well.
For and on behalf of the Board of Directors
| ||Jitendra Kumar Goyal ||Vidhu Bhushan Verma |
|Place: Kolkata ||Managing Director ||Director |
|Date: 30/05/2016 ||(DIN: 00468744) ||(DIN: 00555238) |