DIRECTORS' REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS
To the Members
Your Directors have pleasure in presenting this Annual Report of your Company togetherwith the Annual Audited Statements of Accounts for the year ended March 31 2017.
Despite of Company Law Board Order dated April 04 2014 for change in management of theCompany and Company Law Board Order dated June 04 2015 the Old management did nothandover all records of the Company to the new management.
| || ||(Rs. in Lakhs) |
|Financial Results ||Year Ended 31.03.2017 ||Year Ended 31.03.2016 |
|Income ||51.39 ||19.04 |
|Less: Expenditure ||44.79 ||16.88 |
|Profit before Tax ||6.60 ||2.16 |
|Less : Income Tax For Current Year ||- ||0.22 |
|Profit after Tax ||6.60 ||1.94 |
As there was minimal income in the current year to strengthen the financial positionof the Company and to augment working capital your directors regret to declare anydividend.
RESERVES & SURPLUS
Total profit of Rs.6.60/- Lakhs for the financial year is proposed to be transferred tothe General Reserve.
BRIEF DESCRIPTION OF THE COMPANY'S WORKING DURING THE YEAR/STATE OF COMPANY'S AFFAIR
Your Directors have pleasure to inform you that Company has succeeded in starting thetrading from the previous financial year and has generated gross revenue of Rs.51 lacs andprofit after tax is 6.60 lacs.
CHANGES IN SHARES CAPITAL
During the financial year the Company has issued 20667 Equity Shares to Mr. AkhileshMalvi Managing Director of the Company on preferential basis for rounding off of paid upshare capital of the Company for the purpose of consolidation of share capital of theCompany.
Further company has consolidated its entire authorised issued subscribed and paid-upshare capital by increasing the nominal value of the equity shares from Rs.1/- (Rupees Oneonly) each to Rs. 10/- (Rupees Ten only) each so that every
10 (Ten) equity shares with nominal value of Rs.1/- (Rupees One only) each held by amember are consolidated and re-designated into 1 (one) equity share with nominal value ofRs.10/- (Rupees Ten only) each.
REGISTERED OFFICE AND CORPORATE OFFICE
During the period under review there is no change in Registered Office Address andCorporate Office Address of the Company.
Your Company primarily operates in the business segment of mining and trading.
RISK & CONCERNS
Subsequent to the Company Law Board Principle Bench Delhi vide its order dated June4 2015 the company is trying to recover from its financial mess done by its old board.The Board is confident of its recovery.
The overall downturn in the fuel prices will only benefit the company and lower theoperational cost of the company.
The Board of directors perceives that competition from established players and changein government policies as major threats. These coupled with Price volatility Trade policyuncertainties and Environmental concerns also possess its own challenges.
The Company business is of cyclic nature which has its own problems.
SVC Resources Limited (SVC) is a BSE listed company. SVC is a professionally managedCompany with the Board Members having rich and varied experience in Exploration MiningProcessing Trading Finance and other fields.
INTERNAL CONTROL SYSTEMS AND ADEQUACY
The present internal control systems are commensurate with its size.
As per records available from BSE Website and MCA Website Company has only oneoverseas subsidiary SVC Resources FZC Sharjah UAE. However the company has no recordspertaining to its subsidiary as old management has not handed over the records to the newmanagement despite of the Company Law Board Order. Hence subsidiary accounts are notenclosed.
As the Old Board has not handed over the books of accounts statutory records andminutes book the company is not in a position to ascertain acceptance of public deposits.Company Law Board New Delhi vide its order dated June 4 2015 has directed the old boardto handover books of accounts and other records to the new board. However the old boardis yet to hand over the same. The new management of the Company has not accepted anydeposit from public since the new management has taken charge of the Company.
PARTICULARS OF LOANS GIVEN GUARANTEES GIVEN OR INVESTMENTS MADE UNDER SECTION 186 OFCOMPANIES ACT 2013
Particulars of loans guarantees and investments made by Company pursuant to Section186 of the Companies Act 2013 are given in the notes to the financial accounts and formspart of the Annual Report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
During the period under review Mr. Tushar Moghe Chief Financial Officer of the Companyvacated the office with effect from June 23 2016.
Re-appointment of Whole time Director has been considered during the year.
COMPANY'S POLICY RELATING TO DIRECTORS APPOINTMENT PAYMENT OF REMUNERATION ANDDISCHARGE OF THEIR DUTIES
Company's policy relating to directors appointment payment of remuneration anddischarge of their duties is annexed herewith as Annexure II.
Pursuant to Regulation 15(2) of the Securities Exchange Board of India (ListingObligations and Disclosure Requirements) 2015 compliance of Corporate Governance is notmandatory. However the company has complied with the provisions of Regulation 17 to 27 ofthe Securities Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 to the extent possible. A separate section on Corporate Governanceforms part of the Directors' Report as Annexure IV.
Company encourages a culture that develops and empowers people promotes team buildingand nurtures new ideas. The Company's recruitment practice ensures that suitablecandidates with merit are recruited and provided with the right opportunities to growwithin the organization.
AUDITORS Statutory Auditors
M/s. Jain and Jain Chartered Accountants were appointed as Statutory Auditor of theCompany in the previous AGM held on September 30 2016 for the period of five years i.eupto March 31 2021 and being eligible the Board has recommended their re-appointment.
The Auditors have given a qualified Audit Report with the following qualification:-
Basis for Disclaimer of Opinion
So far as information and explanations given to us the Old Management of the Companywas removed in an Extraordinary General Meeting held on January 11 2014 and supported bythe an order of the Company Law Board Delhi dated April 4 2014.
Thereafter the Old Management did not hand over books of accounts statutory recordsminutes books bank statements subsidiary details and any other records/documents to theNew Management. Since then the New Management of the Company is engaged in a legal battlewith the Old Management. As such the Company does not have books of accounts or any otherrecords. In this regard the Company had filed petition with the Company Law Board Delhi.The case was decided in favor of the New Management on June 4 2015. However the NewManagement is yet to receive the books of accounts and other records of the company fromthe Old Management.
We have not been able to access the books of accounts and other records of the company;the elements making up the Balance Sheet and the Statement of Profit and Loss and CashFlow.
Disclaimer of Opinion
Because of the significance of the matters described in the Basis of Disclaimer ofOpinion paragraph we have not been able to obtain sufficient appropriate audit evidenceto provide a basis for an audit opinion. Accordingly we do not express an opinion on thefinancial statements.
Subsequent to Company Law Board Order dated June 04 2015 the new management is incontinues touch for handover of Books of Accounts and Statutory Records. The company hasalso filed a complaint with the police station for the same. The company is yet to receiveBooks of Accounts and Statutory Records. Financial statements have been prepared on thebasis of records available with the Company Banks BSE and Government Authorities.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and Companies(Appointment and Remuneration of Managerial Person) Rules 2014 the Company has appointedM/s. J.S. Virani & Associates to undertake the Secretarial Audit of the Company.
In terms of provisions of Section 204(1) of the Companies Act 2013 Secretarial AuditReport is annexed to this Board Report as Annexure III.
PARTICULARS OF EMPLOYEES
The Company has no directors or employees who are in receipt of remuneration exceedingthe sum prescribed under section 197 of the Companies Act 2013 read with Rule (5) ofCompanies (Appointment and Remuneration of Managerial Person) Rules 2014.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
The company has in place a policy for prevention of sexual harassment in accordancewith the requirements of the Sexual Harassment of women at workplace (PreventionProhibition & Redressal) Act 2013. Internal Complaints Committee has been set up toredress complaints received regarding sexual harassment. All employees (permanentcontractual temporary trainees) are covered under this policy. The Company did notreceive any complain during the year 2016-17.
Pursuant to the provisions of Companies Act 2013 and Securities Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) 2015 the Board has carried outannual performance evaluation of its own performance the directors individually as wellthe evaluation of the working of its Audit Nomination & Remuneration andStakeholders' Relationship Committee including the Chairman of the Board who wereevaluated on parameters such as level of engagement and contribution and independence ofjudgment thereby safeguarding the interest of the Company. The performance evaluation ofthe Independent Directors was carried out by the entire Board. The performance evaluationof the Chairman and the Non Independent Directors was carried out by the IndependentDirectors. The Directors expressed their satisfaction with the evaluation process.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information pertaining to Conservation of Energy Technology Absorption and ForeignExchange earnings and outgo as required under section 134(3)(m) of the Companies Act 2013read with rule 8(3) of the Companies (Accounts) Rules 2014 is annexed to this report asAnnexure I.
TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND
Company does not have any funds lying unpaid or unclaimed for a period of seven years.Therefore there were no funds which were required to be transferred to Investor Educationand Protection Fund (IEPF).
DIRECTORS RESPONSIBILITY STATEMENT
As the Old Board has not handed over the books of accounts statutory records andminutes book the company is not in a position to confirm and ascertain the genuineness ofvarious balances and advances shown in the Annual Report for the year ended March 312013.
The Company Law Board Principle Bench New Delhi vide its order dated June 04 2015has directed the old board to handover books of accounts and other records to the newboard. However the old board is yet to hand over the same.
Pursuant to Section 134 of the Companies Act 2013 the Directors state that:
(a) In the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures; (b)Appropriate accounting policies have been selected and applied consistently and have madejudgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as at March 31 2017 and of the profit andloss of the Company for the year ended March 31 2017; (c) Proper and sufficient care hasbeen taken for the maintenance of adequate accounting records in accordance with theprovisions of the Companies Act 2013 for safeguarding the assets of the Company and forpreventing and detecting fraud and other irregularities; (d) The annual accounts have beenprepared on a going concern basis; (e) Proper internal financial controls were followed bythe Company and such internal financial controls are adequate and were operatingeffectively; (f) Proper systems are devised to ensure compliance with the provisions ofall applicable laws and that such systems are adequate and operating effectively.
DECLARATION BY INDEPENDENT DIRECTOR
Pursuant to Section 149(6) of the Companies Act 2013 and Securities Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) 2015 the Independent Directors ofthe Company have given the declaration to the Company that they qualify the criteria ofindependence as required under the Act.
The Company has established a Vigil Mechanism that enables the Directors and Employeesto report genuine concerns. The Vigil Mechanism provides for (a) adequate safeguardsagainst victimization of persons who use the Vigil Mechanism; and (b) direct access to theChairperson of the Audit Committee of the Board of Directors of the Company in appropriateor exceptional cases. The web link for the Whistle Blower Policy ishttp://svcresources.co.in/wp-content/uploads/2015/12/Whistle-Blower-Policy.pdf
CORPORATE SOCIAL RESPONSIBILITY
The provision of Corporate Social Responsibility does not apply to the company.
RELATED PARTY TRANSACTIONS
No transactions were carried out between any of the related parties in the year underreview. The web link for related party transaction policy ishttp://svcresources.co.in/wp-content/uploads/2015/12/Related-Party-Transaction.pdf
The Company has devised and implemented a mechanism for risk management and hasdeveloped a Risk Management Policy. The Policy provides for creating a Risk Registeridentifying internal and external risks and implementing risk mitigation steps.
FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS
The Company proactively keeps its Directors informed of the activities of the Companyits management and operations and provides an overall industry perspective as well asissues being faced by the industry.
SEPARATE INDEPENDENT DIRECTOR MEETING
The Board of Directors of the Company meets once in every Financial Year without thepresence of Executive Directors and Management of the Company. The role of the Committeeis as per the provisions of Companies Act 2013 as well as the Securities Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form MGT 9 is Annexedherewith as Annexure V
SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS
BSE Limited suspended the trading in securities of the Company On August 21 2015 theCompany had applied to BSE Limited for revocation of suspension and got the same revokedon June 07 2016 along with monetary penalty.
The Board of Directors wishes to convey their appreciation to all your Company'semployees for their performance and continued support. The Directors would also like tothank all the Shareholders Consultants Customers Vendors Bankers Service Providersand Government and Statutory Authorities for their continued support.
|Place: Mumbai || |
|Date: May 25 2017 || |
| ||For and on behalf of the Board |
| ||For SVC Resources Limited |
| ||Chairman |