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AKG Exim Ltd.

BSE: 535110 Sector: Others
NSE: AKG ISIN Code: INE00Y801016
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AKG Exim Ltd. (AKG) - Director Report

Company director report

To The Members AKG EXIM LIMITED

Your Directors have pleasure in presenting the Fourteenth Annual Report together withthe Audited Accounts of the Company for the year ended 31st March 2019.

FINANCIAL HIGHLIGHTS

The Financial highlights for the year under review are given below:-

Standalone (Rs. In Lacs)
Particulars For the year ended 31st March 2018 For the year ended 31st March 2019
Total Income 11235.09 11839.89
Total Expenses 11087.37 11689.24
Profit before Exceptional and 147.72 150.65
Extraordinary Item
Prior Period Items - -
Profit Before Tax 147.72 150.65
Tax Expense:
Current Tax 41.93 30.72
Deferred Tax 3.72 11.64
Taxes of Earlier Years - -
Profit After tax 102.07 108.29

YEAR UNDER REVIEW

On Standalone basis for the year 2018-19 your Company has achieved a Net Profit aftertax of INR 108.29 Lacs as against INR 102.07 Lacs in the year 2017-18. The total turnoverincluding other income for the year 2018-19 stood at INR 11839.89 Lacs as compared to INR11235.09 Lacs for the year 2017-18 indicating a growth of 5.34%

During the year 2018-19 revenue from operations increased to INR 11779.22 Lacs ascompared to INR 11182.12 Lacs in 2017-18.

DIVIDEND

The Board of Directors has not recommended any Dividend on paid up share capital duringthe year ended 31st March 2019.

CHANGE IN CAPITAL STRUCTURE

During the year under review there has been change in the paid Capital of the Companydue to Initial Public Offering (IPO). The paid-up capital of the Company has beenincreased from 4840120 equity Shares of Rs. 10/- each to 6610120 equity Shares of Rs. 10/-each

TRANSFER TO GENERAL RESERVE

During the year under review Rs. 108.30 Lacs has been transferred to General Reserve.

TRANSFER AMOUNT TO INVESTOR EDUCATION & PROTECTION FUND

As per the provisions of Section 125 of the Companies Act 2013 deposits / dividendremaining unclaimed for a period of seven years from the date they become due for paymenthave to be transferred to Investor Education & Protection Fund (IEPF) established bythe Central Government.

During the year under review there has been no any unclaimed deposit/dividendremaining to transfer.

MATERIAL AND SIGNIFICANT ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

No significant and material orders have been passed by the regulators or courts ortribunals against the Company impacting the going concern status and Company's operationsin future.

PERFORMANCE OF SUBSIDIARIES ASSOCIATE AND JOINT VENTURE COMPANIES

During the Financial Year 2018-19 your Company has no Subsidiary or associates or anyJoint venture Companies.

DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THEFINANCIAL STATEMENTS

According to Section 134 (5) (e) of the Companies Act 2013 the term InternalFinancial Control (“IFC”) means the policies and procedures adopted by theCompany for ensuring the orderly and efficient conduct of its business including adherenceto Company's policies the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information.

During the Year under review the system and controls of your Company are audited bythe Internal Auditor and their findings and recommendations are reviewed by the AuditCommittee which ensures timely implementation.

PUBLIC DEPOSITS

During the Financial Year 2018-19 your Company has not accepted any deposit within themeaning of Sections 73 and 74 of the Companies Act 2013 read together with the Companies(Acceptance of Deposits) Rules 2014 as amended upto date.

AUDITORS

M/s. Sharma Sharma & Co. Chartered Accountants (Registration No. 009462N)Statutory Auditors were appointed for 3 (Three) Financial Years upto FY 2020-2021 and inview of the first proviso to Section 139 of the Companies Act 2013. Your Company hasreceived an eligibility letter from the auditors to the effect that the ratification oftheir appointment would be in accordance with Sections 139 and 141 of the Companies Act2013.

AUDITORS' REPORT

There being no reservation qualification adverse remarks in the Auditors' Report nofurther explanations are required.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act 2013 read with TheCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Companyappointed Neelam Bansal & Associates Practicing Company Secretaries and Proprietor ofMs. Neelam Bansal Company Secretaries to conduct Secretarial Audit for the Financial Year2018-19.

There are some observations in the Secretarial Audit Report issued by M/s. NeelamBansal & Associates and Report of the Secretarial Audit is set out herewith as anAnnexure- B to this Report. The Board reply on the Observations are as follows:

- The Board will ensure the said compliance in future;

- The Board will ensure the website of Company is updated with required information;

- The Board will ensure the compliance on time and also there has been no instance ofany penalty thereafter the penalty was imposed since the management was not aware of therequisite compliances.

DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS OTHER THAN THOSE WHICH ARE REPORTABLETO THE CENTRAL GOVERNMENT

The Statutory Auditors or Secretarial Auditors or Internal Auditor of the Company havenot reported any frauds to the Audit Committee or to the Board of Directors under Section143(12) of the Companies Act 2013 including rules made thereunder.

EXTRACT OF THE ANNUAL RETURN

Pursuant to sub-section 3(a) of Section 134 and sub-section (3) of Section 92 of theCompanies Act 2013 read with Rule 12 of the Companies(Management and Administration)Rules 2014 the relevant extract of the Annual Return as at 31st March 2019 is set outas an Annexure- A to this Report.

DIRECTORS

(A) RESIGNATION

During the year under review there was change in the composition of the Board ofDirectors of your Company.

During financial year Mr. Arun Kumar Goyal (DIN: 01061882) has resigned from theposition of Independent Director of your Company in its meeting held on the 9th February2019.

(B) APPOINTMENT

After the end of previous financial year Mr. Rahul Bajaj (DIN: 03408766) was appointedas an Additional Independent Director of your Company in its meeting held on the 27thJuly 2019.

The matter of appointing him as regular Independent Director appears as an Agenda inthe Notice of the 14th Annual General Meeting.

A brief profile of the above named Director seeking appointment at the ensuing AnnualGeneral Meeting of the Company has been provided in the Notice of the 14th Annual GeneralMeeting.

(B ) RETIRE BY ROTATION

In accordance with the provisions of Section 152 of the Companies Act 2013 and theArticles of Association of the Company Mrs. Mahima Goel Executive Director(DIN:02205003) is liable to retire by rotation at the ensuing Annual General Meeting ofthe Company and being eligible offers herself for reappointment.

(C) INDEPENDENT DIRECTORS

The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed under sub-section (6)of the Companies Act 2013.

LISTING OF SHARES

The Company's Shares are listed on SME Platform of National Stock Exchange of IndiaLimited dated 25th September 2019 with ISIN INE00Y801016.

KEY MANAGERIAL PERSONNEL(S)

Pursuant to Section 203 of the Companies Act 2013 read with The Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 In addition to Managing Directorthe Company has employed the Company Secretary and Chief Financial Officer of the Companyas Key Managerial Personnel.

COMMITTEES OF THE BOARD

The Committees of the Company has been reconstituted due to resignation of Mr. ArunGoyal dated 9th February 2019 and appointment of Mr. Rahul Bajaj as an IndependentDirector on 27th July 2019. At present there are Four (4) Committees of the Board ofyour Company:-

• Audit Committee

• Nomination & Remuneration Committee Stakeholder Relationship CommitteeSub-Committee

Details of all the above Committees of the Board are as follows;-

AUDIT COMMITTEE

Your Company has an Audit Committee in compliance with the provisions of Section 177 ofthe Companies Act 2013.

The Audit Committee of your Company comprises of the following members:-

Mr. Rakesh Mohan Chairman

Mrs. Mahima Goel Member

Mr. Rahul Bajaj Member

Apart from Mrs. Mahima Goel all other Committee members are Independent. Members ofthe Audit Committee possess financial/accounting expertise/ exposure. During the yearunder review there was no such recommendation of the Audit Committee which was notaccepted by the Board.

NOMINATION AND REMUNERATION COMMITTEE

Your Company has a Nomination and Remuneration Committee in compliance with theprovisions of Section 178 of the Companies Act 2013 which amongst others is responsiblefor identifying and recommending persons who are qualified to become directors orappointed as part of senior management of the Company and laying down remuneration policy.

The Nomination and Remuneration Committee of your Company comprises of the followingDirectors as members:-

Mr. Rakesh Mohan Member
Mr. Laxman Singh Yadav Member
Mr. Rahul Bajaj Member

STAKEHOLDER RELATIONSHIP COMMITTEE

Our Company has constituted a Stakeholder's Relationship Committee to redress thecomplaints of the shareholders. The Stakeholders Relationship Committee was reconstitutedvide resolution passed at the meeting of the Board of Directors held on 27thJuly 2019.

The Stakeholder Relationship Committee of your Company comprises of the followingDirectors as members:-

Mr. Rakesh Mohan Member
Mr. Laxman Singh Yadav Member
Mr. Rahul Bajaj Member

SUB COMMITTEE

The Board had constituted the Sub Committee for dealing with the day to day matters ofthe Company.

The Committee of your Company comprises of the following members:-

Mr. Rajeev Goel Chairman
Mrs. Mahima Goel Member

INDEPENDENT DIRECTORS MEETING

Independent Directors of the Company met one time during the year on 31stMarch 2019 as per Regulation 25 of SEBI (Listing obligations and Disclosure Requirements)Regulations 2015.

CORPOARTE SOCIAL RESPONSIBILITY

During the year under review the provisions of the Section 135 of the Companies Act2013 are not applicable on the Company.

NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS

During the year ended 31st March 2019 the Board of Directors of your Company met Ten(10) times viz. on the 6th April 2018; 16th May 2018; 23rd May 2018; 31st May 2018;25th June 2018; 11th August 2018; 19th September 2018; 15th November 2018; 24thNovember 2018; and 9th February 2019. The maximum gap between two meetings was not morethan one hundred twenty days.

PARTICULARS OF CONTRACTS OR ARRANGEMENT WITH RELATED PARTIES

During the year under review Company has not been entered into any contract orarrangements or transactions with new/other related parties.

PARTICULARS OF LOANS GUARANTEE AND INVESTMENT

The details of Loans Guarantee and Investments under Section 186 of the Companies Act2013 read with The Companies (Meeting of Board and its Powers) Rules 2014 are asfollows:-

INVESTMENT

During the year under review your Company has not made investment in any Equity Sharesof the Company.

GUARANTEE AND LOANS

During the year under review the Company has not given guarantee or loan to any personor Body Corporate in accordance with Section 186 of the Companies Act 2013 read with therules issued thereunder.

RISK MANAGEMENT

Your Company has evaluated a risk management to monitor the risk management plan forthe company. They ensures that all the risks are timely defined and mitigated inaccordance with the risk management process including identification of elements of riskwhich might threaten the existence of your Company.

VIGIL MECHANISM

The Company has in place an established and effective mechanism called the VigilMechanism Policy. The mechanism under the policy has been appropriately communicatedwithin the Company. The purpose of this policy is to provide a framework to promoteresponsible whistle blowing by employees. It protects employees wishing to raise a concernabout serious irregularities unethical behavior actual or suspected fraud within theCompany.

The concerned employees can directly access the Vigilance Officer/ Managing Director/Chairman of the Audit Committee through e-mail writing and telephone for reporting thematter.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013

Your Company has always believed in providing a safe and harassment free workplace forevery individual working in the premises of the Company. Your Company always endeavours tocreate and provide an environment that is free from discrimination and harassmentincluding sexual harassment.

In view of the same your Company has adopted a policy on prevention prohibition andredressal of Sexual Harassment at Workplace in line with the requirements of the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 and therules framed there under for prevention and redressal of complaints of sexual harassmentat workplace.

During the year under review your Company has not received any complaint from any ofits employee hence no complaint is outstanding for redressal.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICHHAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIALSTATEMENTS RELATE AND THE DATE OF THE REPORT

There are material changes and commitments affecting the financial position of thecompany have occurred between the end of the financial year of the company to which thefinancial statements relate and the date of this report as given below:

• Ms. Jagriti Mendiratta has resigned as the Company Secretary of the Companyw.e.f. 24thNovember 2018.

• Ms. Simpal Kumari has appointed as the Company Secretary of the Company w.e.f.24thNovember 2018.

• Mr. Arun Kumar Goyal (DIN: 01061882)has resigned as an Independent Director ofthe Company w. e. f. 9th February 2019.

• Mr. Rahul Bajaj (DIN: 03408766)was appointed as an Additional IndependentDirector of your Company in its meeting held on the 27th July 2019.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The disclosures required to be made under the provisions of Section 134(3)(m) of theCompanies Act 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 in respect ofconservation of energy technology absorption is not applicable to the Company as theCompany is not involved in any manufacturing processing. The Company mainly engaged in theTrading (Export of non-Basmati Rice and Import of Metal Scraps). Foreign exchange earningsof the Company are Rs. 3406.59 Lacs and outgo are Rs. 4514.84 Lacs.

AUDITORS

STATUTORY AUDITOR

The Shareholders of the Company had appointed M/s. Sharma Sharma & Co.; CharteredAccountants (Firm Registration No. 009462N) New Delhi as the statutory auditor of theCompany for the 3 years commencing from 01/04/2018 to 31/03/2021 in 13th Annual GeneralMeeting held on 20th July 2018.

SECRETARIAL AUDITOR

As required under provision of section 204 of the Companies Act 2013 and rules madethereunder the Board has appointed M/s. Neelam Bansal & Associates; PracticingCompany Secretaries as Secretarial auditor of the Company for conducting the SecretarialAudit for the financial year 2018-19.

There are some observations in the Secretarial Audit Report issued by M/s. NeelamBansal & Associates and Report of the Secretarial Audit is set out herewithasAnnexure- Bto this Report. The Board reply on the Observations are as follows:

- The Board will ensure the said compliance in future;

- The Board will ensure the website of Company is updated with required information;

- The Board will ensure the compliance on time and also there has been no instance ofany penalty thereafter the penalty was imposed since the management was not aware of therequisite compliances.

INTERNAL AUDIT

In accordance with provisions of section 138 of the Companies Act 2013 and rulesframed thereunder your Company has appointed Ms. Esha Behl; Chartered Accountants as anInternal Auditors of the Company for the Financial year 2018-19 and takes theirsuggestions and recommendations to improve and strengthen the Internal Control Systems.

DETAILS OF ADEQUACY OF INTERNAL FINANCIAL CONTROL

The Company is well equipped with adequate internal financial controls. The Company hasa continues monitoring mechanism which enables the organization to maintain the samestandards of the control systems and help them in managing defaults if any on timelybasis because of strong reporting mechanism followed by the Company.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management discussion and analysis report has been separately furnished in theAnnual Report and forms a part of the Annual Report.

DEMATERIALSATION OF SHARES

99.98% equity shares of the Company are in Demat form.

CORPORATE GOVERNANCE

Pursuant with Regulation 27(2) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 read with Clause 15 of Chapter IV of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Paid-up Capital of theCompany is less than Rs. 10 Crores and the Net Worth of the Company is less than Rs. 25Crores.

Also the provisions of Corporate Governance are not applicable on the Companies whoseShares are Listed at Small and Medium Platform. Since the Equity shares of the Companyare listed at SME Platform of NSE (NSE Emerge) Hence the provision of CorporateGovernance report are not applicable on Company.

COMPLAINCE WITH SECRETRIAL STATNDARDS

The Board of Directors affirms that the Company has complied with the applicableSecretarial Standard issued by the Institute of Company Secretaries of India (ICSI) {SS 1and SS2} respectively relating to meetings of Board and Committees which have mandatoryapplications.

ANNUAL RETURN

The Annual Return of the Company shall be placed on the website of the Company and canbe assessed at www.akg-global.com. Pursuant to the provisions of section 92(3) of theCompanies Act 2013 as amended by the Companies Act 2017.

PARTICULARS OF EMPLOYEES

During the year under review No any employees were in receipt of remuneration of Rs.1.20 Crores or more per annum or Rs. 8.50 Lakhs per month if employed for part of theyear hence the particulars required to be reported under Rule 5(2) and Rule 5(3) of TheCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014.

DIRECTOR'S RESPONSIBILITY STATEMENT

Yours Directors state that:

In the preparation of the annual accounts for the year ended 31st March 2019 theapplicable accounting standards have been followed along with proper explanation relatingto material departures if any;

The Directors have selected such accounting policies and applied them consistently andmade judgments 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 31st March 2019 and of the profit ofthe Company for the year ended on that date;

The Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

The Directors have prepared the annual accounts on a “going concern” basis;

The Directors have laid down internal financial controls to be followed by the Companyand that such internal financial controls are adequate and are operating effectively; and

The Directors have devised proper systems to ensure compliance with the provisions ofall applicable laws and such systems are adequate and operating effectively.

FORMAL ANNUAL EVALUATION

The Nomination and Remuneration Committee of the Company has formulated EvaluationPolicy during the year which was approved by the Board of Directors. The Policy providesfor evaluation of the Board the Committee of the Board and individual Directorsincluding the Chairman of the Board. The policy provides that evaluation of theperformance of the Board as a whole Board Committees and Directors shall be carried outon an annual basis.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCTION AND PROTECTION FUND

The provisions of Section 125(2) of the Companies Act 2013 do not apply as there wasno dividend declared and paid last year.

ACKNOWLEDGEMENT

Your Directors wish to convey their gratitude and place on record their appreciationfor all the employees at all levels for their hard work cooperation and dedication duringthe year.

Your Directors sincerely convey their appreciation to customers shareholders vendorsbankers regulatory and government authorities for their continued support.

By Order of the Board of Directors
For AKG Exim Limited
Sd/- Sd/-
RAJEEV GOEL MAHIMA GOEL
Place: New Delhi MANAGING DIRECTOR DIRECTOR
Date: 27th July 2019 DIN: 01507297 DIN: 02205003

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