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Frontline Corporation Ltd.

BSE: 532042 Sector: Others
NSE: N.A. ISIN Code: INE092D01013
BSE 00:00 | 31 Jan Frontline Corporation Ltd
NSE 05:30 | 01 Jan Frontline Corporation Ltd
OPEN 12.00
52-Week high 12.61
52-Week low 11.45
Mkt Cap.(Rs cr) 6
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 12.00
CLOSE 12.00
52-Week high 12.61
52-Week low 11.45
Mkt Cap.(Rs cr) 6
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Frontline Corporation Ltd. (FRONTLINECORP) - Director Report

Company director report


The Members

Frontline Corporation Limited

Your Directors have pleasure in presenting their 29th Annual report alongwith Audited Accounts for the year ended on March 31 2018.

Financial Performance and Appropriations : ( Rs in Lacs ) Current Year ended on 31-03-2018 ( Rs in Lacs ) Current Year ended on 31-03-2017
Revenue from Operations 4425.29 4335.48
Other Income 441.98 967.74
Total Income 4867.28 5303.22
Finance Charges 57.92 523.90
Depreciation 148.67 142.06
Profit /( Loss) before Taxation &Exceptional and Extra Ordinary Items 232.34 82.00
Exceptional Items 0 43.94
Profit / ( Loss ) before Tax 232.34 125.95
Provision for Taxes - Current 52.50 43.50
Provision for Taxes - Deferred (12.63) (39.36)
Income Tax - Earlier Period 0 36.82
Profit /( Loss) for the year from continuing operations 192.48 84.99
Other comprehensive Income ( Net of Tax ) (0.47) (0.35)
Total Comprehensive Income 192.00 84.64
Opening Balance of Retained Earnings 45.92 (38.71)
Comprehensive Profit/ ( Loss) for the year 192.00 84.64
Proposed Dividend 0 0
Balance Carried to Balance-Sheet 237.92 45.92


Previous years' figures have been regrouped wherever necessary to bring them in linewith the current year's representation of figures.

Reserves and Surplus :

The Opening Balance of Retained Earnings is 45.92 lacs. The Company has transferred thewhole of the Comprehensive Income of Rs. 192.00 lacs to Retained Earnings. The ClosingBalance of the Retained Earnings stands at Rs. 237.92 lacs.

Dividend :

In order to conserve resources your Directors do not recommend any dividend for theyear.

Review Of Operations:

Total Income has declined from Rs. 5303.22 lacs to Rs. 4867.28 lacs which isapproximately decline of 8.2%. The financial charges has reduced from Rs. 523.90 lacs toRs. 57.92 lacs which is approximately decline of 88.9%. Total Comprehensive Income hasincreased from Rs. 84.64 lacs to Rs. 192.00 lacs which is an increase of 126%approximately

Disclosure under Rule 8 (5) of Companies (Accounts) Rules 2014:

Change in Nature of Company Business:

The Company is engaged in the business of transportation wind energy trading ofautomotive parts and renting of immovable properties. The Company has added Petroleumdistribution to its business objects during the year. Other than this there is no changein nature of Company Business.

Details of Directors / Key Managerial Personnel Appointed / Resigned:

No Directors / Key Managerial Personnel were appointed or have resigned during the yearunder the review.

Details of Holding / Subsidiary Companies / Joint Ventures / Associate Companies:

During the year under review there was no holding / Subsidiary Company / JointVentures / Associate Companies were there.


The Company has not invited any deposit other than the exempted deposit as prescribedunder the provision of the Companies Act 2013 and the rules framed there under asamended from time to time. Hence there are no particulars to report about the depositfalling under Rule 8 (5) (v)and ( vi ) of Companies ( Accounts ) Rules 2014.

Deposit accepted from Directors

Pursuant to Provisions of Rule 2(1 ) ( c ) ( viii ) of the Companies ( Acceptance ofDeposit ) Rules 2014 an amount of Rs. 2.10 lacs outstanding as on 31st March2018 from the Directors of the Company in the financial year.

Inter Corporate Deposit

Further an amount of Rs. 49.48 lacs was outstanding towards Inter Corporate Deposit atthe end of the financial year.

Details of Significant and Material Orders passed by Regulators or Courts or Tribunals:

During the year under review there were no significant and material orders passed byany Regulators or Court or Tribunals which may have impact on the going concern status. Noorder has been passed by any Regulators or Court or Tribunals which may have impact on theCompany‘s operation in future.

Internal Financial Controls:

The Company has adequate internal financial controls to support the preparation of thefinancial statements.


The properties of the Company stand adequately insured against risks of fire strikeriot earthquake explosion and malicious damage.


As required under the provisions of Section 134 of the Act your Directors report that:

(a) In the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures.

(b) 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 Profits of the Company for that period.

(c) The Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities.

(d) The Directors have prepared the annual accounts on a going concern basis.

(e) The Directors have laid down internal financial controls as required by Explanationto Section 134(5) (e) of the Act to be followed by the Company and such internal financialcontrols are adequate and are operating effectively.

(f) The Directors have devised proper systems to ensure compliance with the provisionsof applicable laws and such systems are adequate and operating effectively.


There was no employee drawing remuneration requiring disclosure under the Rule 5 (2) ofCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014.


The Company is not required to conduct Cost audit during the year. The Company is notrequired to file Cost audit report during the year under review.


The Equity Shares of the Company are listed on BSE Limited and Calcutta Stock Exchange.The Company is regular in payment of listing fees. The Company has paid the listing feesfor the year 2018 - 2019.


The Auditors M/s. Paresh Thothawala & Co. Chartered Accountants Ahmadabad holdoffice until the conclusion of the ensuing Annual General Meeting and have expressed theirwillingness to be reappointed. The Company has received a letter from a member of theCompany proposing the name of M/s. Paresh Thothawala & co. Chartered Accountants asStatutory Auditors of the Company. Members of the Company at the 25thAnnualGeneral Meeting of the Company have appointed M/s. Paresh Thothawala & co. CharteredAccountants as auditors of the Company upto 30th Annual General Meeting of theCompany. In accordance with the provision of Section 139 of the Companies Act 2013members are requested to ratify the appointment of the auditors for the balance term tohold office from the conclusion of the 29thAnnual General Meeting until theconclusion of the 30th Annual General Meeting subject to ratification at eachannual general meeting on such remuneration as may be fixed by the Board apart fromreimbursement of out of pocket expenses as may be incurred by them for the purpose ofaudit

The Company has received a certificate from the Auditors to the effect that theirappointment if made would be within the prescribed limits under Section 141 (3)(g) of theCompanies Act 2013

The auditors observations and its reply are as under :

Basis for Qualified Opinion

Note No. 6 regarding physical possession and selling of Land &Building taken by Punjab and Sind Bank.


The Honourable Calcutta High Court larger Bench has ruled in favor of the Company.However the Bank has preferred an appeal to the Honourable Supreme Court of India. Thematter pending before legal forum and hence the same will be dependent on verdict of CourtOrder.

Note No. 6 and 37.8 for Demand Notice issued by UCO Bank and J&K bankby virtue of which some fixed assets details of which are given in detailed note of fixedassets have been symbolically possessed by the bank.

Reply to above Qualifications : In reply to the above mentioned qualification yourDirectors state that the attachment of properties by the Bank is a legal process and theCompany is taking all legal steps to protect the property. The Properties were given assecurity for the loan availed by Fairdeal Supplies Limited. Fairdeal Supplies Limited hasreached an Settlement agreement with UCO Bank and also with The Jammu and Kashmir BankLimited. Consequent upon the paymentof the settlement amount with Banks the Companyexpects to release the property.

Reference is invited Note No. 37.8 to the financial statements regardingcorporate guarantee given by the company for credit facilities to Fairdeal SuppliesLimited a group company and noncompliance of Section 295 of the companies Act 1956.


In reply to the above mentioned qualification of the Independent Auditors' Report theBoard of Directors hereby replies that the Company at the time when M/s. Fairdeal SuppliesLimited a Group concern of the Company obtained the loan from the Banks the financialconditions and other prospects of M/s. Fairdeal Supplies Limited were excellent. The Boardof Directors of the Company did not forecast that loan availed by M/s. Fairdeal SuppliesLimited will be defaulted. The Bankers of M/s. Fairdeal Supplies Limited have stipulatedcondition to give the collateral and guarantee for the facilities to be availed by theFairdeal Supplies Limited.

• The Board of Directors of the Company would further like to state that it hasalready filed necessary petition before the respective authorities for compounding thematter.

Non Provision of Interest of Rs. 50341942/- on Cash Credit and PackingCredit facilities availed from Punjab & Sindh Bank for current year as accountdeclared as NPA(Non Performing Assets).


The interest provision on loan of Punjab and Sindh Bank has not been accounted due tolegal dispute. The Honourable Calcutta High Court larger Bench has ruled in favor of theCompany. However the Bank has preferred an appeal to the Honourable Supreme Court ofIndia. The matter pending before legal forum and hence the same is not accounted for.

Reference is invited Note No. 17 to the financial statements according towhich an amount of Rs. Rs. 53644817/- (Previous year Rs. Rs. 59657498/-) isoutstanding which has been given to M/s. Gateway Commodities (P) Ltd. as loans. Themanagement has explained that such loans have been given in the normal course of business.As per information made available to us and explanation given Rs. 6012681/- (previousyear Rs. 5399081) have been recovered / adjusted during the current financial year. Themanagement based on internal assessments and evaluations have represented that thebalance outstanding advances are still recoverable/ adjustable and that no accrual fordiminution of advances is necessary as at balance sheet date. The management has furtherrepresented that as significant amounts have been recovered/adjusted during the previousand current financial year and since constructive and sincere efforts are being put in forrecovery of the said advances they are confident of appropriately adjusting / recoveringsignificant portions of the remaining outstanding balance of such amounts in theforeseeable future. However we are unable to ascertain whether all the remainingoutstanding advances as above are fully recoverable / adjustable since the outstandingbalances as at balance sheet date are outstanding for a long period of time and furtherthat neither the amount recovered nor interest provided on such long outstanding amountsin the current year consequently we are unable to ascertain whether all of the remainingbalances as at balance sheet date are fully recoverable. Accordingly we are unable toascertain the impact if any that may arise in case any of these remaining advances aresubsequently determined to be doubtful of recovery.

Reply to the above mentioned qualification : The Company is in the process of makingrecovery of trade receivables and loans and advances. The Company is exploring all legaloptions for the same. It could be seen from the qualification itself that there is areduction in the outstanding amount.


The details in respect of the conservation of energy technology absorption and foreignexchange earnings and outgo are more detailed in the Annexure I to the Directors Report.


Pursuant to SEBI ( Listing Obligations and Disclosure Requirements ) Regulations 2015Management Discussion & Analysis Corporate Governance Report and Auditor'sCertificate regarding compliance to conditions of corporate governance are made part ofthis Annual Report. The Management Discussion and Analysis which is attached herewith andforms part of the report and which is attached as Annexure VII and the CorporateGovernance Report which is attached herewith and forms part of the report and which isattached as Annexure VIII.

Related Party Transactions

All related party transactions that were entered into during the year under report wereon an arm's length basis and in the ordinary course of business. There are no materiallysignificant related party transactions made by the Company during the year. Related PartyTransactions Policy is available on the website of the Company The details of transactions with the related party isprovided in . No advance is / was paid for entering into related party transactions.

The prices paid to the related party transactions are based on the ruling market rateat the relevant point of time. The requisite details in form AOC - 2 is attached herewithas Annexure - II which forms part of the Directors Report Particulars of Loans /Guarantees / Investment:

The details of the loans provided are mentioned in note no. 13 and 18 of the BalanceSheet. Members are requested to refer the same. Further with respect to loans / investmentto and from the related parties are more detailed in note no. 33 of the Balance Sheet.

The Company has provided its Security and also provided its Corporate Guarantee for theloan availed by M/s. Fairdeal Supplies Limited for Rs. 318 Crores. The Security /Corporate Guarantee was provided under the erstwhile Companies Act 1956 which iscontinuing till date.

Code for Prevention of Insider Trading Practices

The Company has instituted a comprehensive code of conduct in compliance with the SEBIregulations on prevention of insider trading. The code lays down guidelines which adviseon procedures to be followed and disclosures to be made while dealing in shares of theCompany and cautions on the consequences of noncompliances. The Code is also available onthe website of the Company i.e.

Risk Management Policy

The Company has a structured risk management policy. The Risk management process isdesigned to safeguard the organisation from various risks through adequate and timelyactions. It is designed to anticipate evaluate and mitigate risks in order to minimizeits impact on the business. The potential risks are inventoried and integrated with themanagement process such that they receive the necessary consideration during decisionmaking. It is dealt with in greater details in the management discussion and analysissection. The Risk Management Policy is also available on the Company‘s website

Declaration by Independent Directors:

The following Directors are independent in terms of Section 149(6) of the Act and SEBI( Listing Obligations and Disclosure Requirements ) Regulations 2015 :

(A) Shri Virendra Sharma

(B) Shri Jiwraj Khaitan

(C) Shri Sital Kumar Banerjee

(D) Mrs. Aarefa Kutub Kapasi

The Company has received requisite declarations/ confirmations from all the aboveDirectors confirming their independence.

Extract of the Annual Return

Pursuant to provision of Section 92 and 134 and other applicable provision of theCompanies Act 2013 and of Rule 12 (1) of Companies (Management and Administration) Rules2014 the extract of the annual return in form MGT 9 for the Financial Year ended on 31stMarch 2018 is annexed as Annexure III to this Report.

Number of Board Meetings

During the year the Board of Directors met 10 times ( including adjourned meeting heldon 30.5.2017 ). The dates of the Board meetings are as under :

01.04.2017 15.05.2017 30.05.2017 31.05.2017 03.07.2017 10.07.2017 11.08.201713.11.2017 19.12.2017 and 14.02.2018

Corporate Social Responsibility:

The Company is not covered under the criteria of the provision of Section 135 of theCompanies Act 2013 read with the Companies (Corporate Social Responsibility Policy)Rules 2014 and therefore it is not mandatory for the Company to have the CorporateSocial Responsibility.

Disclosure under the Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013

The Company has in place an Anti-harassment policy in line with the requirements of theSexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.Internal Complaint Committee are set up at shop floor level to redress complaints receivedregularly and are monitored by women line supervisors who directly report to the Chairman.All employees (permanent contractual temporary trainees) are covered under the policy.There was no compliant received from any employee during the financial year 2017-18 andhence no complaint is outstanding as on 31.03.2018 for redressal.

The Company has constituted an internal complaint committee pursuant to SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.


The Company has complied with the mandatory Secretarial Standards issued pursuant toSection 110 of the Companies Act 2013.


Pursuant to Section 204 of the Act the Secretarial Audit Report for the Financial Yearended 31st March 2018 given by M/s. Jalan Alkesh & Associates Practising CompanySecretary is annexed as Annexure IV to this Report.

The Qualifications made by the Secretarial Auditor and its reply is as under :

a) Delayed filing of certain forms with the Ministry of Corporate Affairs requiredunder the Companies Act 2013. However for late filing of forms the Company has paidadditional fees.

Reply : The Company will take the necessary steps to ensure the due compliance of thelaw in time so that the Company do not have to pay additional fees for the same.

b) The Company has given Security / Guarantee to the Bankers for the loans obtained byM/s. Fairdeal Supplies Limited in violation of erstwhile Companies Act 1956 which isstill continuing.

Reply : The same is given in the auditors and auditors report herein above.

c) Further with respect to the advances to M/s. Gateway Commodities Pvt. Ltd. werequest the members to refer the Balance Sheet and the Statutory Auditors Report remarks.The advances to M/s. Gateway Commodities Private Limited were given under the erstwhileCompanies Act 1956. Reply : The same is given in the auditors and auditors report hereinabove.

d) The quarter and year end results were required to be submitted to the exchangelatest by 30th May 2017. As per the intimation given by the Company to BSE theresults were to be declared has scheduled the Board meeting on 30th March2017. However the Board meeting could not be held on 30th May 2017 due toquorum and therefore the same was held on 31st May 2017. The BSE has imposedpenalty for the same.

Reply: The Company will take necessary steps to ensure that the listing compliances aredone in time. Further the Company has replied to the exchange.

e) The quarter and year end results for the year ended on 31st March 2018was required to be submitted to the exchange latest by 30th May 2018. Howeverthere was delay in submission of financial results to the exchange.

Reply : The year end results were delayed as due to implementation of the IndianAccounting Standard and consequently this being the 1st year the Company willtake adequate steps in advance for the compliance of the same.


In compliance with the provisions of the Act and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the performance evaluation was carried out asunder:


In accordance with the criteria suggested by The Nomination and Remuneration Committeethe Board of Directors evaluated the performance of the Board having regard to variouscriteria such as Board composition Board processes Board dynamics etc. The IndependentDirectors at their separate meetings also evaluated the performance of the Board as awhole based on various criteria. The Board and the Independent Directors were of theunanimous view that performance of the Board of Directors as a whole was satisfactory.

Committees of the Board:

The performance of the Audit Committee the Nomination and Remuneration Committee andthe Stakeholders Relationship Committee was evaluated by the Board having regard tovarious criteria such as committee composition committee processes committee dynamicsetc. The Board was of the unanimous view that all the committees were performing theirfunctions satisfactorily and according to the mandate prescribed by the Board under theregulatory requirements including the provisions of the Act the Rules framed thereunderand SEBI ( Listing Obligations and Disclosure Requirements ) Regulations 2015.

Individual Directors:

(a) Independent Directors: In accordance with the criteria suggested by TheNomination and Remuneration Committee the performance of each independent director wasevaluated by the entire Board of Directors (excluding the director being evaluated) onvarious parameters like engagement leadership analysis decision making communicationgovernance and interest of stakeholders. The Board was of the unanimous view that eachindependent director was a reputed professional and brought his/her rich experience to thedeliberations of the Board. The Board also appreciated the contribution made by all theindependent directors in guiding the management in achieving higher growth and concludedthat continuance of each independent director on the Board will be in the interest of theCompany.

(b) Non-Independent Directors: The performance of each of the non-independentdirectors (including the chair person) was evaluated by the Independent Directors at theirseparate meeting. Further their performance was also evaluated by the Board of Directors.The various criteria considered for the purpose of evaluation included leadershipengagement transparency analysis decision making functional knowledge governance andinterest of stakeholders. The Independent Directors and the Board were of the unanimousview that each of the non-independent directors was providing good business and peopleleadership


The requisite details as required by Section 134(3) (e) Section 178(3) & (4) andSEBI ( Listing Obligations and Disclosure Requirements ) Regulations 2015 is attachedherewith and forms part of the Directors Report. The details of the remuneration policy ofthe Company as required in terms of the SEBI ( Listing Obligations and DisclosureRequirements ) Regulations 2015 is provided in Annexure V to the Report.

The details in respect Disclosure under Section 197(12) and Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 are provided inAnnexure VI of the Report.


There are no material changes and commitments if any affecting the financial positionof the Company subsequent to the date of the Balance sheet and up to the date of thereport.


Your Directors acknowledge the continued support and cooperation received from theCentral Government State Government Shareholders Banks and other Lenders suppliers andDealers Employees and Other Stake holders.

The Board also wishes to record its sincere appreciation of the total commitmentdedication and hard work put the every member of Company.

By order of the Board of Directors of Frontline Corporation Limited
Sd/- Sd/-
Place : Ahmedabad Narayan Prasad Agarwal Pawan K umar Agarwal
Date : 17th August 2018 Director Managing Director
DIN :00060384 DIN :00060418