The Members of CSL Finance Limited
Your Company's Directors are pleased to present the (Twenty-Ninth) 29thAnnual Report along with the Audited Financial Statements of the Company for the financialyear ended 31stMarch 2021.
1. FINANCIAL HIGHLIGHTS
(Rs in Lacs)
|Particulars ||Current Year 31-03-2021 ||Previous Year 31-03-2020 |
|Revenue from operations ||6167.31 ||6085.53 |
|Other Income ||18.65 ||9.53 |
|Total Income ||6185.96 ||6095.06 |
|Expenses || || |
|Operating Expenses ||1856.32 ||2506.47 |
|Depreciation amortization and impairment ||61.16 ||74.45 |
|Other Expenses ||332.47 ||339.89 |
|Total Expenses ||2249.95 ||2920.81 |
|Profit /loss before Tax ||3936.01 ||3174.25 |
|Less: Tax Expenses ||(1 183.22) ||(926.88) |
|Profit for the year ||2752.79 ||2247.37 |
|Other Comprehensive Income ||8.21 ||11.53 |
|Total Comprehensive Income for the year ||2761.00 ||2258.90 |
2. OPERATIONAL PERFORMANCE/ THE STATE OF COMPANY'S AFFAIRS
During the year the company had a muted performance given thechallenging industry dynamics. Its income during the year grew by 1.50% to Rs 61.86 Cr inFY21 from Rs 60.95 Cr in FY20. Profit After Tax (PAT) increased by 22.46 % i.e. Rs 27.53Cr in FY21 vs Rs 22.48 Cr in FY20 an increase of AUM by 3.78% from Rs 318 Cr in FY20 toRs 330 Cr in FY21. The Net Worth increased by 11.45 % from Rs 232.55 Cr in FY20 to Rs259.18 Cr in FY21. As a prudent risk management practice the Company has already providedthe ECL provision under Stage-1 & Stage-2 of X4.84 Cr and Rs3 Cr respectively. GNPAhas risen to 2.11% in FY21 as compared to 0.69% in FY20 in the overall portfolio largelydue to the NPA's observed in the school loans segment.
Depreciation and Finance Costs
During the year under review Depreciation was Rs 61.16 lacs ascompared to Rs 74.45 lacs for the previous year. Finance costs for FY 2020-21 was Rs700.80 lacs as compared to Rs 1060.69 lacs for the previous year.
The total borrowings stood at X8260.41 lacs (including debt securities)as on 31st March 2021 as against Rs 9592.45 lacs as on 31st March2020.
Debt Securities (Redeemable Non-Convertible Debentures)
During FY 2020-21 the Company raised 300 10.25% UnsecuredNon-Convertible Redeemable Debentures of face value Rs10 lacs each aggregating to Rs30.00Crores and 100 10.00% Unsecured Non Convertible Redeemable Debentures of face value Rs10lacs each aggregating to Rs10.00 crores. The Company has entered into Debenture TrusteeAppointment Agreement with Catalyst Trusteeship Limited (CIN: U74999PN1997PLC110262) toact as the Debenture Trustee for the Debenture Holders of the Company for the both theNCD's issued.
The COVID-19 pandemic which is a once in a lifetime occurrence hasbrought with it an unimaginable suffering to people and to almost all sections of theeconomy. The nationwide lockdowns to curtail the transmission of disease had put theglobal economy in extreme stress of the level not seen since the Great Depression andwould have a long-lasting economic impact.
The dynamic and evolving nature of the pandemic with its resurgence(second wave) at the close of the year once again creates uncertainty including economicimpact. Hopefully the outreach of vaccination drives across the country additionalefforts to set up medical infrastructure and obtain required medical supplies in additionto continued adherence to COVID-19 specific protocols will help in overcoming this testingsituation.
Like the greater economy the pandemic coupled with the lockdown andrelief measures provided by RBI had a bearing on the performance of the Company. Theimpact of the above on the performance of the Company and the measures adopted by theCompany to steer through the pandemic have been discussed in detail in ManagementDiscussion and Analysis Report.
3. CHANGE IN THE NATURE OF BUSINESS IF ANY
During the period under review there is no change in the nature ofbusiness of the Company.
Yours Directors recommended final Dividend of 30% i.e. Rs3.00/- perequity share of Rs10/- each fully paid up for financial year 2020-21 in its meeting heldon 25th June 2021 on pre Bonus share capital i.e. ^61692070/- which isproportionately adjusted to 10% which works out to Re. 1.00/- per equity share of Rs10/-each fully paid up post bonus issue capital of the Company i.e. ^185076210/- subjectto approval of Members at the ensuing 29th Annual General Meeting of theCompany and shall be paid within the statutory period to those members whose names appearin the register of members holding shares either in physical form or in dematerializedform on the close of Thursday 23 d September 2021 (Previous year Rs2.5 pershare was paid as final dividend to the members).
5. TRANSFER TO RESERVES
The company proposes to transfer ^550.56 lacs to Statutory Reserves inaccordance with the provisions of Section 45-IC of the Reserve Bank of India Act 1934.
6. SHARE CAPITAL
As on 31st March 2021 the Share Capital of the Companystood at-
|Authorised Capital ||9400000 (Ninety Four Lacs) Equity Shares of Par Value T10 each. |
|Issued Subscribed and Paid-Up Capital ||6169207 (Sixty One Lacs Sixty Nine Thousand Two Hundred Seven) Equity Shares of Par Value T10 each. |
7. CAPITAL ADEQUACY
Capital Adequacy as on 31st March 2021 stood at healthy78% which is well above the minimum regulatory norms for Non-Deposit Accepting NBFCs ascompared to 73% in the previous year.
8. CREDIT RATING
During F.Y. 2020-21 rating for Long-term Bank Facilities and Non-Convertible Debentures are re-affirmed at CARE BBB; Stable by CARE Rating Limited("CARE').
9. CORPORATE GOVERNANCE
Your Company continues to lay a strong emphasis on transparencyaccountability and integrity. The Company has taken the requisite steps to comply with therecommendations concerning Corporate Governance. As provided under Section 134 of theCompanies Act 2013 and Rules framed thereunder and pursuant to Regulation 34(2) (d) ofthe SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 the Reporton Corporate Governance along with necessary certificates is set out in Annexure-"E"and forms part of this Report.
Being a non-deposit taking Company your Company has not accepted anydeposits from the public within the meaning of the provisions of the NonBanking FinancialCompanies Acceptance of Public Deposits (Reserve Bank) Directions 2016 and provisions ofCompanies Act 2013.
11. RBI GUIDELINES
The Company continues to comply with all the regulations prescribed bythe Reserve Bank of India from time to time.
12. SUBSIDIARIES COMPANIES JOINT VENTURES AND ASSOCIATES
The Company has no subsidiary Company or Associate Company. The Companyhas not entered into any joint venture during the year under review.
13. NUMBER OF MEETINGS OF THE BOARD
During the financial year 2020-21 fifteen (15) Board Meetings wereheld on below mentioned dates. The maximum time-gap between any two consecutive meetingsdid not exceed 120 (One Twenty) days. Further details regarding Board Meetings are givenin the Section of Corporate Governance which forms part of this Report.
|09.06.2020 ||20.07.2020 ||29.07.2020 ||10.08.2020 ||01.09.2020 |
|14.09.2020 ||28.09.2020 ||13.10.2020 ||20.10.2020 ||12.11.2020 |
|03.12.2020 ||18.12.2020 ||30.12.2020 ||12.02.2021 ||25.02.2021 |
14. COMMITTEES OF THE BOARD
The Board has constituted necessary Committees pursuant to theprovisions of the Companies Act 2013 rules framed there under and SEBI (ListingObligations and Disclosure Requirements) Regulation 2015. The Committees of the Board areAudit Committee Stakeholders' Relationship Committee Investor Relations & ShareTransfer Committee Nomination and Remuneration Committee Corporate Social ResponsibilityCommittee Management Committee and Internal Complaints Committee. The Board has acceptedall the recommendations of the above committees.
The details about Composition of Committees and their Meetings areincorporated in the Board of Directors in Corporate Governance section forming part ofthis Report.
15. DIRECTORS AND KEY MANAGERIAL PERSONNEL'S
As on 31st March 2021 the Board of your Company consistsof six Directors as follows and two Key Managerial Personnel's:
|Name ||Category |
|Mr. Rohit Gupta ||Managing Director (Executive Promoter Director) |
|Mr. Ashok Kumar Kathuria ||Non-Executive Director |
|Mr. Manoj Gupta ||Non-Executive Independent Director |
|Ms. Anjna Mittal ||Non-Executive Independent Director (Woman Director) |
|Mr. Ayush Mittal ||Non-Executive Independent Director |
|Ms. Rachita Gupta ||Whole Time Director (Executive Promoter Woman Director) |
|Mr. Naresh Chandra Varsney ||Chief Financial Officer |
|Ms. Anju Biyani ||Company Secretary & Compliance Officer |
The composition of the Board is as per the Companies Act 2013 and theSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. As on 31stMarch 2021 there was
no disqualification of any Director pursuant to Section 164 (2) of theCompanies Act 2013. A certificate has been received from Mr. Nitin Panchal (COP: 1 9534)M/s. N Panchal & Associates Company Secretaries Delhi- That none of the Directors onthe Board of the Company has been debarred or disqualified from being appointed orcontinuing as directors of companies by the Securities and Exchange Board of IndiaMinistry of Corporate Affairs or any such statutory authority. The said certificate isannexed to this Report as Annexure-"A".
The other details with respect to Board of Directors are given inCorporate Governance section forming part of this Report
During the year under review there was a change in composition ofBoard of the Company. Ms. Rachita Gupta (DIN:09014942) was appointed as the AdditionalWhole Time Director of the Company for a term of five (05) years w.e.f. 30th December2021 to 29d December 2025 and Mr. Ayush Miital (DIN: 07667437) was appointedas the Additional Non-Executive Independent Director of the Company for a term of five(05) years w.e.f. 30th December 2021 to 29d December 2025Theappointment of Ms. Gupta and Mr. Mittal was approved by the members of the Company throughPostal Ballot /remote e- voting on 28th July 2021.
As per Section 196 of the Companies Act 2013 a person shall not beappointed as Managing Director of the Company for a term exceeding five years at a timeand shall not be re-appointed earlier than one year before expiry of his term.
The Board of Directors in their meeting held on 11th August2021 upon recommendation made by Nomination and Remuneration Committee of the Companyhas approved the appointment of Mr. Rohit Gupta (DIN: 00045077) as Managing Director ofthe Company for a further term of 5 years i.e. from 10th August 2022 to 09thAugust 2027 on terms and conditions as set out in the Notice of ensuing 29thAGM subject to the approval of members of the Company at the ensuing AGM.
Retirement by Rotation
In accordance with the provisions of the Companies Act 2013 andRegulation 36 of the Listing Regulations Mr. Ashok Kumar Kathuria (DIN: 01010305)retires at the ensuing AGM and being eligible offers himself for re-appointment. Thebrief resume/ details relating to Director who is to be re-appointed is furnished in theNotice of the ensuing 29th AGM. The Board of Directors of your Companyrecommends the reappointment of the Director liable to retire by rotation at the ensuingAGM.
During the financial year none of the director resigned from thedirectorship of the company.
All the Independent Directors on the Board have given a declaration oftheir independence to the Company as required under Section 149(6) of the Act andRegulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 ("Listing Regulations").
In the opinion of the Board all the Independent Directors possess theintegrity expertise and experience including the proficiency required to be IndependentDirectors of the Company fulfil the conditions of independence as specified in the Actand the SEBI Listing Regulations and are independent of the management and have alsocomplied with the Code for Independent Directors as prescribed in Schedule IV of the Act.The Company has received the following declarations from all the Independent Directorsconfirming that:
i. They meet the criteria of independence as prescribed under theprovisions of the Act read with the Schedule and Rules issued thereunder and the ListingRegulations. There has been no change in the circumstances affecting their status asIndependent Directors of the Company; and
ii. They have registered themselves with the Independent Director'sDatabase maintained by the IICA.
In terms of the provisions of Section 149 of the Companies Act 2013and Regulation 17 (1) (a) of the SEBI (LODR) Regulations 2015 the Company shall have atleast one Woman Director on the Board. Your Company has Ms. Rachita Gupta (DIN: 09014942)appointed w.e.f 30th December 2020 and Ms Anjna Mittal (DIN: 07143461) as theWomen Directors on the Board of the Company.
b) Changes in Kev Managerial Personnel (KMP) during the F.Y. 2020-21
During the year under review there was change in the Company Secretary(key managerial personnel) of the Company as mentioned below:
|Name of the Company Secretary ||Date of Resignation/Appointment |
|Mr. Akash Gupta ||Resigned from the post of Company Secretary and Legal Head w.e.f. the close of business hours of 24th July 2020. |
|Ms. Gunjan Khera ||Ms. Gunjan Khera who was associated with the Company as Legal Manager for more than 5 years was appointed as Company Secretary and Compliance Officer w.e.f. 25th July 2020 after resignation of Mr. Akash and resigned on 18th February 2021 due to personal reasons |
|Ms. Anju Biyani ||Ms. Anju Biyani was appointed as the Company Secretary and Compliance Officer w.e.f. 25th February 2021 but she resigned on 25th June 2021 due to death of her father-in-law and personal family reasons. |
|Ms. Preeti Gupta ||Ms. Preeti is the present Company Secretary and Compliance Officer w.e.f. 26th June 2021. |
16. BOARD EVALUATION
Pursuant to the provisions of the Act and provisions of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 a separate exercise wascarried out to evaluate the performance of individual Directors who were evaluated onparameters such as level of engagement and contribution and independence of judgmentthereby safeguarding the interest of the Company. The performance evaluation of theIndependent Directors was carried out by the entire Board. The performance evaluation ofthe Non - Independent Directors was carried out by the Independent Directors. The boardalso carried out annual performance evaluation of the working of its Audit Nomination andRemuneration as well as Stakeholder Relationship Committee. The Directors expressed theirsatisfaction with the evaluation process.
17. TRANSACTIONS WITH RELATED PARTIES
All the transactions with Related Parties are placed before the AuditCommittee and also before the Board for approval. Prior omnibus approval of the AuditCommittee and the Board is obtained for the transactions which are of a foreseen andrepetitive nature.
All transactions entered into with related parties during the year wereon arm's length basis largely in the ordinary course of business and in line with thethreshold of materiality defined in the Company's policy on Related Party Transactions& are in accordance with the provisions of the Companies Act 2013 Rules issuedthereunder & Regulation 23 of (SEBI Listing Obligations and Disclosure Requirements)Regulations 2015. During the financial year ended 31st March 2021 there wereno transactions with related parties which qualify as material transactions and hence didnot require members' prior approval under the Companies Act 2013 and the ListingRegulations.
A policy on materiality of related party transactions and dealing withrelated party transactions is placed on the Company's website i.e.https://www.cslfinance.in/ and may be accessed through the web linkhttps://www.cslfinance.in/wp-content/uploads/2021/02/Policy-on-Materiality-of-Related-Party-Transactions-1.pdf.Transactions with related parties have been disclosed in the note 46 to the FinancialStatements.
18. FRAUD REPORTING
There was no instance of fraud during the year under review whichrequired the Statutory Auditors to report to the Audit Committee and/or Board underSection 143(12) of the Act and Rules framed there under.
19. FAMILIARISATION PROGRAMME FOR THE INDEPENDENT DIRECTORS
In compliance with the requirement of Regulation 25 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 (SEBI (LODR)Regulations") the Company has put in place a familiarization programme for theIndependent & Non-Executive Directors to familiarize them with the Company theirroles rights responsibilities in the Company nature of the industry in which theCompany operates business model etc. The details of the such familiarisation programmeare available on the website of the Company i.e. https://www.cslfinance.in/ and may beaccessed through the web linkhttps://www.cslfinance.in/wp-content/uploads/2019/12/Familirisation-program-for-IDs.pdf
20. DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to Section 134 (3) (C) read with Section 134 (5) of theCompanies Act 2013 Directors state that:
a) In the preparation of Annual Accounts for the year ended on 31stMarch 2021 the applicable accounting standards have been followed and there are nomaterial departures from the same;
b) The Directors have selected such accounting policies and appliedthem consistently 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 on 31stMarch 2021 and the profit of the Company for that period;
c) The Directors have taken proper and sufficient care for themaintenance of the adequate accounting records in accordance with the provisions of theCompanies Act 2013 for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities;
d) The Directors have prepared Accounts on 'going concern' basis;
e) The Directors have laid down internal financial controls to befollowed by the Company and that such financial controls are adequate and are operatingeffectively; and
f) The Directors have devised proper systems to ensure compliance withthe provisions of all applicable laws and that such system are adequate and operatingeffectively
21. SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS
There were no significant material orders passed by theRegulators/Courts during the previous year which would impact the going concern status ofthe Company and its future operations.
22. NOMINATION AND REMUNERATION COMMITTEE
The Board has framed a policy on the recommendation of the Nominationand Remuneration Committee relating to remuneration of the Directors Key ManagerialPersonnel Senior Management and other employees along with the criteria for appointmentand removal of the Directors Key Managerial Personnel and Senior Management of theCompany.
The Nomination and Remuneration Committee is fully empowered todetermine /approve and revise subject to necessary approvals the remuneration ofmanagerial personnel after taking into account the financial position of the Companytrends in the industry qualifications experience past performance and pastremuneration etc.
The policy is available at Company's website athttps://www.cslfinance.in/ and may be accessed through the web linkhttps://www.cslfinance.in/wp- content/uploads/2021/02/REMUNERATION-POLICY.pdf The otherdetails with respect to committee composition and meetings are given in Board of DirectorsSection of Corporate Governance Report annexed to this Report.
23. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The particulars of loans guarantees and investments as per Section 186of the Act by the Company have been disclosed in the notes to the Financial Statements.
24. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013
The Company has zero tolerance towards sexual harassment at workplaceand has adopted a Policy on prevention prohibition and redressal of sexual harassment atworkplace in line with the requirements of the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 and Rules made thereunder.
The same is posted on the website of the Companyhttps://www.cslfinance.in/ and may be accessed through the web linkhttps://www.cslfinance.in/wp- content/uploads/2021/02/CSL_ANTI-SEXUAL-HARASSMENT-POLICY.pdf
As required under law an Internal Complaints Committee has beenconstituted for reporting and conducting inquiry into the complaints made by the victim onthe harassments at the work place. During the year under review there were no cases filedor reported pursuant to the provisions of the said Act. The same has also been disclosedin the Corporate Governance Report forming integral part of the Board's Report.
25. FAIR PRACTICE CODE (FPC)
The Company has in place a Fair Practice Code approved by the Board incompliance with the guidelines issued by the RBI to ensure better service and providenecessary information to customers to take informed decisions. The FPC is posted on thewebsite of the Company https://www.cslfinance.in/ and may be accessed through the web linkhttps://www.cslfinance.in/wp- content/uploads/2020/11/Fair_Practice_Code_CSL.pdf The FPCis also reviewed by the Board at frequent intervals to ensure its level of adequacy andappropriateness.
26. AUDITORS & THEIR REPORT
In terms of Section 139 of the Companies Act 2013 M/s. Aggarwal &Rampal (FRN: 003072N) Chartered Accountants Delhi have been appointed as StatutoryAuditors of the Company at the 25th Annual General Meeting (AGM') of theCompany held on 05th September 2017 from the conclusion of the said AGM tillconclusion of 30th Annual General Meeting subject to ratification by theMembers at every intervening Annual General Meeting.
The requirement of seeking ratification of the members for continuanceof Statutory Auditors appointment has been withdrawn consequent upon the changes made bythe Companies (Amendment) Act 2017 w.e.f. 7th May 2018. Hence the resolutionseeking ratification of the members for their appointment is not being placed at theensuing Annual General Meeting.
The Statutory Auditors M/s. Aggarwal & Rampal CharteredAccountants have issued their reports on Financial Statements for the year ended 31stMarch 2021. There are no adverse remarks or qualifications in the said report. The Noteson Accounts referred to in the Auditors' Report are self-explanatory and do not call forany further comments. The Members are therefore requested to approve the Auditors' Report.
In compliance with the provisions of Section 204 and other applicableprovisions of Companies Act 2013 the Board of Directors in their Board Meeting held on 25thJune 2021 have appointed Mr. Nitin Panchal (COP: 19534) Proprietor of M/s. N. Panchal& Associates Company Secretaries Delhi as Secretarial Auditors to undertakesecretarial audit of the Company for the financial year ended 31st March 2021.
The Secretarial Audit Report is attached herewith marked as AnnexureB and forms an integral part of this report.
The Report contains the following Observations:
1. E-Form MGT-14 has not been filed for the events as per detailsmentioned below:
a.) Appointment of Secretarial Auditor for financial year 2019-20(Event Date 09-06-2020). b.) Resignation of Mr. Akash Gupta (KMP) & Appointment of Ms.Gunjan Khera (KMP) (Event Date 25-07-2020).
2. The Board was not constituted as per regulation 17(1) of SEBI(Listing Obligations & Disclosure Requirements) Regulations 2015 for Quarter endedJune 2020 September 2020 & December 2020 as applicable on the basis of Market Cap oftop 2000 Listed Companies. BSE Limited (Stock Exchange) has levied penalty of ^1610700/-in aggregate for the aforesaid non-compliance and Company has filed Representation Letterto the Stock Exchange and also Complied with aforesaid for the year ended 31st March2021.
Company's explanation on the aforesaid Observations-
As per the provisions stipulated under Reg. 17(1) of the ListingRegulations the Board of Directors of top 2000 listed entities based on marketcapitalization were required to have at least 6 directors w.e.f. 01st April2020. However due to Covid-19 Pandemic and frequent changes in the Secretarial Team ofthe Company the Company could not even perceive that it was falling within the Top 2000companies and that there can be a lapse in the number of directors appointed on its Boardof Directors.
This compliance failure got inadvertently overlooked by the secretarialteam and was not brought to the notice of the management. When it was brought to thenotice of the management the Company immediately appointed two Directors on its Board andcomplied with the provisions of Reg. 17(1) of SEBI (LODR) Regulations 2015.
The Company has also filed its Representation Letter along with aRequest Letter to BSE Limited regarding the said compliance and to waive off the penaltyimposed.
Also the Management was not made aware of nonfiling of the abovementioned e-forms MGT-14 which was the key responsibility area of the SecretarialDepartment. The management will take necessary steps to ratify the same.
The Board has re-appointed M/s. R Mahajan & Associates (FRN:011348N) Chartered Accountants Delhi as the Internal Auditors of the Company for theFinancial Year 2021-22.
27. ANNUAL RETURN
Pursuant to Section 92(3) read with Section 134(3)(a) of the Act theAnnual Return in Form MGT-7 as on 31st March 2021 is available on theCompany's website at https://www.cslfinance.in/ may be accessed through the web link:https://www.cslfinance.in/wp- content/uploads/2021/08/Annual-Return-AGM- 2021.pdf
28. COMPLIANCE ON SECRETARIAL STANDARDS
The Company has complied with the applicable Secretarial Standards onMeetings of the Board of Directors and on General Meetings issued by the Institute ofCompany Secretaries of India.
29. CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Board has constituted a Corporate Social Responsibility("CSR") Committee in terms of the provisions of Section 135 of the CompaniesAct 2013 read with Companies (Corporate Social Responsibility Policy) Rules 2014. Thecomposition and terms of reference of the CSR Committee is provided in the CorporateGovernance report forming part of this Report. The policy is available on the website ofthe Company at https://www.cslfinance.in/ may be accessed through the web link:https://www.cslfinance.in/wp-content/uploads/2019/11/CSR-Policy_CSL.pdf During thefinancial year 2020-21 the Corporate Social Responsibility (CSR) expenditure incurred bythe Company was ^62.32 Lacs. The annual report on CSR activities undertaken during thefinancial year 2020-21 is in accordance with the provisions of the Companies Act 2013 andCompanies (Corporate Social Responsibility Policy) Rules 2014 and is appended as Annexure- "C" to this Report.
30. MEETING OF INDEPENDENT DIRECTORS
During the year under review the meeting of Independent directors washeld on 12th February 2021 to review the performance of NonIndependentDirectors the Board as a whole and also to assess the quality quantity and timelines offlow of information between the company management and the Board in line with therequirement of Listing Regulations 2015 read with applicable provisions of Schedule IV ofthe Companies Act 2013.
31. VIGIL MECHANISM/WHISTLE BLOWER POLICY
The Vigil Mechanism Policy aims to provide a channel to the Directorsand employees to report genuine concerns about unethical behavior actual or suspectedfraud or violation of the Code of Conduct or policy. The mechanism provides for adequatesafeguards against victimization of Directors and Employees and ensures that theactivities of the Company and its employees are conducted in a fair and transparent mannerby adoption of highest standards of professionalism honesty integrity and ethicalbehaviour. A copy of the Policy is available on the website of the Company and may beaccessed through the web link https://www.cslfinance.in/wp-content/uploads/2020/08/Whistle-Blower- Policy_CSL.pdf
32. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITIONOF THE COMPANY BETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THIS REPORT
There has been material changes and commitments affecting the financialposition of the Company which have occurred between the end of the financial year and thedate of this report as stated below-
The Company has increased the Authorized Share Capital of the Companyfrom Rs 94000000 (Rupees Nine Crore Forty Lakhs only) divided into 9400000 (NinetyFour Lakh) equity shares of Rs 10 each to Rs 200000000 (Rupees Twenty Crore only)divided into 20000000(Two Crore) equity shares of Rs10 each.
The Company has issued Bonus Shares to the holders of equity shares ofthe Company in the proportion of 2 (two) equity share of Rs10/- (Rupees Ten) each fullypaid up for every 1 (One) equity share of Rs10/- (Rupees Ten) each fully paid up held ason the record date by capitalizing part of the sum standing in the Securities PremiumAccount of the Company as at 31th March 2021.
33. PARTICULARS OF ENERGY CONSERVATION TECHNOLOGY ABSORPTIONEXPENDITURE ON RESEARCH
The requirements of disclosure with regard to Conservation of Energy interms of Section 134 of the Companies Act 2013 read with the Companies (Accounts) Rules2014 are not applicable to the Company since it doesn't own any manufacturing facility.
34. INTERNAL FINANCIAL CONTROLS
The Company has adequate system of internal control to safeguard andprotect from loss unauthorized use or disposition of its assets commensurate with itssize scale and complexities of its operations. The internal auditor of the Company checksand verifies the internal control and monitors them in accordance with policy adopted bythe company.
The Audit Committee of the Board of Directors actively reviews theadequacy and effectiveness of the internal control systems and suggests improvements tostrengthen the same. All the transactions are properly authorised recorded and reportedto the Management. The Company is following all the applicable Accounting Standards forproperly maintaining the books of accounts and reporting financial statements.
35. INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
During the year 2020-21 no amount was transferred to the InvestorEducation and Protection Fund (IEPF).
36. CSL EMPLOYEE STOCK OPTION SCHEME 2016
With a view to attract reward and retain talented and key employees inthe competitive environment and to encourage them to align individual performance withCompany objectives the Company grants share based benefits to eligible employees underthe ESOP Schemes. The Company's ESOS Scheme titled "CSL Employee Stock OptionsScheme 2016" (CSL ESOS 2016) was approved by the members on September 30 2016.
700000 options are covered under the CSL ESOS 2016 which isadministered through CSL Employees Welfare Trust ('ESOP Trust').
The applicable disclosure under the ESOP Regulations is uploaded on thewebsite of the Company (web link https://www.cslfinance.in/stock- exchange-updates/).
The details of the scheme along with grant wise details of optionsvested exercised and cancelled have also been disclosed in Note 34 to the FinancialStatements forming integral part of the Annual Report.
The Company has not issued any sweat equity shares or equity shareswith differential rights during Fy2021. Certificate from Aggarwal & Rampal CharteredAccountants Statutory Auditors with respect to the implementation of CSL ESOP 2016 andits compliance with the SEBI (Share Based Employee Benefits) Regulations 2014 ('ESOPRegulations') would be placed before the members at the ensuing 29th AGM. The details ofthe scheme have also been disclosed in Note 34 to the Financial Statements formingintegral part of the Annual Report.
37. DISCLOSURE PURSUANT TO RULE 5 OF COMPANIES (APPOINTMENT ANDREMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014
The statement containing particulars of employees as required underSection 197(12) of the Companies Act 2013 read with Rules 5(2) and 5(3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexed herewith as Annexure-"D"and forms part of this Report.
Other details in terms of Section 197(12) of the Companies Act 2013read along with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is annexed herewith as Annexure-"D" and formspart of this Report.
38. CODE OF CONDUCT FOR DIRECTORS AND EMPLOYEES
The Company has adopted a Code of Conduct for its Directors andemployees including a code of conduct for Independent Directors which suitablyincorporates the duties of Independent Directors as laid down in the Companies Act 2013.The said Codes can be accessed on the Company's website at https://www.cslfinance.in/ maybe accessed through the web link:https://www.cslfinance.in/wp-content/uploads/2019/11/CSL-Code-of-Conduct.pdf In terms of the Listing Regulations allDirectors and Senior Management Personnel have affirmed compliance with their respectivecodes. The Managing Director has also confirmed and certified the same whichcertification is provided at the end of the Report on Corporate Governance
39. LISTING OF SHARES
The shares of the Company are listed on BSE Limited (BSE). Theapplicable listing fees for the year upto F.Y. 2021-22 have been duly paid to BSE.
40. OTHER DISCLOSURES
No application has been made under the Insolvency and Bankruptcy Code;hence the requirement to disclose the details of application made or any proceedingpending under the Insolvency and Bankruptcy Code 2016 (31 of 2016) during the yearalongwith their status as at the end of the financial year is not applicable to theCompany.
The requirement to disclose the details of difference between amount ofthe valuation done at the time of onetime settlement and the valuation done while takingloan from the Banks or Financial Institutions along with the reasons thereof is also notapplicable.
Your Directors would like to record their appreciation for the hardwork and commitment of the Company's employees and warmly acknowledge the unstintingsupport extended by its bankers alliance partners and other stakeholders in contributingto the results. We put our sincere thanks to the shareholders for the confidence reposedby them in the company and looking forward to have the same support in the coming time.
And last but not the least We mourn the loss of lives due to COVID-19pandemic and are deeply grateful and have immense respect for every person who riskedtheir life and safety to fight this pandemic
42. CAUTIONARY STATEMENT
Statements in the Board's Report and Management Discussion andAnalysis describing the Company's objectives outlook opportunities and expectations mayconstitute "Forward Looking Statements" within the meaning of applicable lawsand regulations. Actual results may differ from those expressed or implied expectations orprojections among others. Several factors make a significant difference to the Company'soperations including the government regulations taxation and economic scenario affectingdemand and supply natural calamity and other such factors over which the Company does nothave any direct control.
| || ||FOR & ON BEHALF OF THE BOARD |
| ||Sd/- ||Sd/- |
| ||(Rohit Gupta) ||(Ashok Kumar Kathuria) |
|Place: Noida ||Managing Director ||Director |
|Date: 11thAugust 2021 ||DIN-00045077 ||DIN-0101305 |