TO THE MEMBERS
Your Directors have pleasure in presenting the 24th Annual Report togetherwith the Audited Financial Statement for the financial 31 year ended st March2018.
OPERATIONS AND OUTLOOK
The main operations of the Company are that of an Investment Company and majority ofthe investments of the Company are in the nature of strategic investment in GroupCompanies. The investment pattern of the Company complies with the requirement for theCompany to qualify as a Core Investment Company - Non-Banking Financial Company(CIC-NBFC). However the Company is exempted from registration as CIC as per applicableReserve Bank of India guidelines. The source of income for the Company is in the form ofdividends. The year witnessed several landmark policy and structural reforms. Theimplementation of GST and recapitalization of Public Sector Banks and proactive stepsundertaken for resolution of Non Performing Loans are some of the key initiatives whichshall strengthen the Indian Economy. It is heartening that the International Credit RatingAgencies have upgraded Indias Credit Rating after 13 years. The Indian Economy isexpected to grow over 7.75% in the current fiscal. This should have a positive impact onthe working of the investee companies and the capital market leading to better valuations.
Your Directors have recommended the Interim Dividend of Rs. 30/- per Equity Share(300%) for the financial year ended 31st March 2018 as Final Dividend for thefinancial year 2017-18.
The financial results of the Company for the financial year ended 31 stMarch 2018 are as under:
| || ||Rs. /Lacs |
| ||2017-18 ||2016-17 |
|Profit after Tax for the year ||1350.15 ||1343.49 |
|Add: Balance brought forward ||5073.28 ||3729.79 |
|Amount available for appropriation ||6423.43 ||5073.28 |
SCHEME OF ARRANGEMENT
The Scheme of Arrangement between Florence Investech Limited ("Florence")BMF Investments Limited J.K. Fenner (India) Limited ("JK Fenner") and Bengal& Assam Company Limited ("The Transferee Company") and their respectiveshareholders approved by the Board of Directors and BSE Limited is pending for approvalof the Shareholders of the Transferee Company Florence JK Fenner and the NationalCompany Law Tribunal Kolkata and Chennai. On sanction of the Scheme and the Schemebecoming effective the Company will be amalgamated into and with Bengal & AssamCompany Limited ("The Transferee Company") in consideration of issue of sharesby the Transferee Company to the shareholders of the Company in terms of the Scheme.
EXTRACT OF ANNUAL RETURN
An extract of the Annual Return as on 31st March 2018 in the prescribedform MGT -9 is attached as Annexure - 1 to this Report and forms part of it.
LOANS GUARANTEES AND INVESTMENT
The Company being a Core Investment Company - Non-Banking Financial Company (CIC-NBFC)Section 186 of the Companies Act 2013 is not applicable to it. The particulars of loansguarantees or investments have been disclosed in the financial statements.
RELATED PARTY TRANSACTIONS
During the financial year ended 31 st March 2018 all the contracts orarrangements or transactions entered into by the Company with the Related Parties were inthe ordinary course of business and on arms length basis and were in compliance withthe applicable provisions of the Companies Act 2013 and the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015. Further the Company has not entered into anycontract or arrangement or transaction with the related parties which could be consideredmaterial in accordance with the policy of the Company on materiality of the Related PartyTransactions. In view of the above disclosure in Form AOC-2 is not applicable.
The Related Party Transactions Policy as approved by the Board is available on thewebsite of the Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Shri Ashok Kumar Kinra retires by rotation and being eligible offers himself forre-appointment at the ensuing
CONSOLIDATED FINANCIAL STATEMENTS
During the Financial Year under review no company has become or ceased to beCompanys subsidiary. In terms of the provisions of the Companies Act 2013 JK AgriGenetics Limited and CliniRx Research Private Limited continues to be associate of theCompany.
The Consolidated Financial Statements have been prepared by the Company in accordancewith the applicable Accounting Standards. The Audited Consolidated Financial Statementstogether with Auditors Report forms part of the Annual Report. A report on theperformance and financial position of each of the associates included in the ConsolidatedFinancial Statements is presented in separate section in this Annual Report. Please referAOC-1 annexed to the Financial Statements.
The Company qualifies to be a Core Investment does not accept public deposits and asrequired by the Reserve Bank of India (RBI) the Board of Directors have also passednecessary resolution not to accept public deposits during the financial year 2017-18without prior approval of RBI.
(a) Statutory Auditors and their Report
M/s Singhi & Co. Chartered Accountants have been appointed as Statutory Auditorsof the Company by the Members at the 23rd Annual General Meeting (AGM) held on25th August 2017 for a term of 5 (five) consecutive years from the conclusionof the 23rd AGM until the conclusion of the 28th AGM subject toratification of the appointment by the Members at the respective Annual General Meetings.However pursuant to the Companies (Amendment) Act 2017 the requirement of ratificationof appointment of the Auditors on yearly basis has been dispensed with. The observationsof the Auditors in their Report on Accounts and the financial statements read withrelevant notes are self-explanatory.
(b) Secretarial Auditor and Secretarial Audit Report
Pursuant to the provisions of Section 204 of the Companies Act 2013 the Board ofDirectors appointed Shri Namo Narain Agarwal Company Secretary in Practice as SecretarialAuditor to carry out Secretarial Audit of the Company for the financial year 2017-18. TheReport given by him for the said financial format is annexed to this Report as Annexure -2. The Secretarial Audit Report does not contain any qualification reservation or adverseremark.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS
During the financial year under review there were no significant or Courts orTribunals which would impact the going concern status of the Company and its futureoperations.
PARTICULARS OF REMUNERATION
Disclosure of the ratio of the remuneration of each Director to the medianemployees remuneration and other requisite details pursuant to section 197 (12) ofthe Companies Act 2013 ("Act") read with Rule 5 (1) of Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 as amended is annexed to thisReport as Annexure - 3. Further particulars of Employees pursuant to Rule 5(2) & (3)of the above Rules forms part of this Report. However as per the provisions of Section136 of the said Act the Report and Accounts are being sent to all the Members of theCompany and others entitled thereto excluding the aforesaid information. Any Memberinterested in obtaining such particulars may write to the Company Secretary at theRegistered Office of the Company. The said information is available for inspection at theRegistered Office of the Company during working hours.
INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with reference tofinancial statements and no material reportable weakness was observed in the system.Further the Company has in place adequate internal financial controls commensurate withthe size and nature of its operations. The Company also has robust Budgetary ControlSystem and Management Information System which are backbone of the Company for ensuringthat your Companys assets and interests are safeguarded.
DIRECTORS RESPONSIBILITY STATEMENT
As required under Section 134(3)(c) of the Companies Act 2013 your Directors statethat:-
(a) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures if any; (b)the accounting policies have been selected and applied consistently and judgments andestimates made are reasonable and prudent so as to give a true and fair view of the stateof affairs of the Company at the end of the financial year and of the profit and loss ofthe Company for that (c) proper and sufficient care has been taken for the maintenance ofadequate accounting records in accordance with the provisions of the said Act forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities; (d) the annual accounts have been prepared on a going concern basis; (e)the internal financial controls to be followed by the Company have been laid down and thatsuch internal financial controls are adequate and were operating effectively; and (f) theproper systems to ensure compliance with the provisions of all applicable laws have beendevised and that such systems were adequate and operating effectively.
CORPORATE GOVERNANCE - including details pertaining to Board Meetings Nominationand Remuneration Policy Performance Evaluation Risk Management Audit Committee andVigil Mechanism.
Your Company reaffirms its commitment to the highest standards of corporate governancepractices. Pursuant to the Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 a Management Discussion and AnalysisCorporate Governance Report and Auditors Certificate regarding compliance of conditions ofCorporate Governance are made a part of this Report.
The Corporate Governance Report which forms part of this Report also covers thefollowing: a) Particulars of the five Board Meetings held during the financial year underb) Policy on Nomination and Remuneration of Directors Key Managerial Personnel and SeniorManagement including inter alia the criteria for performance evaluation ofDirectors. c) The manner in which formal annual evaluation has been made by the Board ofits own performance and that of its Committees and individual Directors. d) The detailswith respect to composition of Audit Committee and establishment of Vigil Mechanism. e)Details regarding Risk Management.
RISK AND CONCERNS
The Company is mainly exposed to capital market risks in the form of change in value ofits investments. The
Company is also exposed to the fluctuations of economy and industry cycles.
The statement in this Management Discussion and Analysis Report describing theCompanys outlook projections estimates expectations may be "Forward-lookingStatements" within the meaning of applicable securities laws or regulations. Actualresults could differ materially from those expressed or implied.
CORPORATE SOCIAL RESPONSIBILITY
The requirement of Corporate Social Responsibility (CSR) in terms of Section 135 of theCompanies Act 2013 and the rules made thereunder is not applicable to the Company sincethe Companys main source of income is dividend from CSR compliant companies.
CONSERVATION OF ENERGY ETC.
As required under Section 134(3)(m) read with the Companies (Accounts) Rules 2014 therequirement of furnishing particulars of energy conservation technology absorption etc.is not applicable to the Company. Further particulars of Foreign Exchange Earning andOutgo are as under:-i) Foreign Exchange earned : NIL ii) Foreign Exchange Outgo : Rs.87.10 Lacs
Your Directors wish to place on record and acknowledge their appreciation for thecontinued support and co-operation received from the Government Authorities LendingInstitutions and the esteemed shareholders of the Company. The Directors also record theirappreciation for the total dedication of the employees.
| ||On behalf of the Board |
| ||Ashok Kumar Kinra |
|Place: New Delhi ||Pradeep Singh Lodha |
|Date: 15th May 2018 ||Directors |