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Frontline Corporation Ltd.

BSE: 532042 Sector: Others
NSE: N.A. ISIN Code: INE092D01013
BSE 00:00 | 27 Aug Frontline Corporation Ltd
NSE 05:30 | 01 Jan Frontline Corporation Ltd
OPEN 11.91
52-Week high 12.60
52-Week low 11.32
Mkt Cap.(Rs cr) 6
Buy Price 11.32
Buy Qty 25.00
Sell Price 11.32
Sell Qty 25.00
OPEN 11.91
CLOSE 11.32
52-Week high 12.60
52-Week low 11.32
Mkt Cap.(Rs cr) 6
Buy Price 11.32
Buy Qty 25.00
Sell Price 11.32
Sell Qty 25.00

Frontline Corporation Ltd. (FRONTLINECORP) - Director Report

Company director report


The Members

Frontline Corporation Limited

Your Directors have pleasure in presenting their 30th Annualreport along with Audited Accounts for the year ended on March 31 2019.

Financial Performance and Appropriations : ( Rs in Lacs ) ( Rs in Lacs )
Current Year ended on 31-03-2019 Current Year ended on 31-03-2018
Revenue from Operations 4655.81 4425.29
Other Income 268.97 441.98
Total Income 4924.78 4867.28
Finance Charges 58.93 57.92
Depreciation 192.13 148.67
Profit /( Loss) before Taxation & (51.38) 232.34
Exceptional and Extra Ordinary Items
Exceptional Items 0 0
Profit / ( Loss ) before Tax (51.38) 232.34
Provision for Taxes – Current 0 52.50
Provision for Taxes – Deferred (17.99) (12.63)
Income Tax – Earlier Period 0 0
Profit /( Loss) for the year from continuing operations (33.39) 192.48
Other comprehensive Income ( Net of Tax ) 1.41 (0.47)
Total Comprehensive Income (31.97) 192.00
Opening Balance of Retained Earnings 237.92 45.92
Comprehensive Profit/ ( Loss) for the year (33.30) 192.00
Remeasurement benefit of defined plans (Net)Dividend 1.41 (0.47)
Balance Carried to Balance-Sheet 206.03 237.92


Previous years' figures have been regrouped wherever necessary tobring them in line with the current year's representation of figures.

The Opening Balance of Retained Earnings is Rs 237.92 lacs. The Companyhas transferred the whole of the Comprehensive Income of Rs. (33.30) lacs to RetainedEarnings. Remeasurement of defenied benefit plans net is Rs. 1.41 lacs. The ClosingBalance of the Retained Earnings stands at Rs. 206.03 lacs.

Dividend :

In order to conserve resources your Directors do not recommend anydividend for the year.

Review Of Operations:

Total Income has increased from Rs. 4867.28 lacs to Rs. 4924.78 lacswhich is approximately increase of 1.18%. The financial charges has increased from Rs.57.92 lacs to Rs. 58.93 lacs which is approximately increase of 1.74%.

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 energytrading of automotive parts and renting of immovable properties. The Company has addedPetroleum distribution to its business objects during the year. Other than this there isno change in nature of Company Business.

Details of Directors / Key Managerial Personnel Appointed / Resigned:

Appointments :

Mr. Rajesh Vasantlal Tripathi was appointed as Additional Director on 8thMarch 2019. Mr. Sanket Dipakbhai Sheth was appointed as Additional Director on 29thMarch 2019.

Resignation and Cessation:

Mr. Jiwraj Khaitan has expired on 28th September 2018. Mr.Sital Kumar Banerjee has resigned on 28th March 2019.

Other than above no Directors / Key Managerial Personnel were appointedor have resigned during the year under the review.

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

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


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

Pursuant to Provisions of Rule 2 ( 1 ) ( c ) ( viii ) of the Companies( Acceptance of Deposit ) Rules 2014no amount is outstanding as on 31st March2019 from the Directors of the Company in the financial year.

Inter Corporate Deposit

Further an amount of Rs. 60.78 lacs was outstanding towards InterCorporate Deposit at the end of the financial year.

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

During the year under review there were no significant and materialorders passed by any Regulators or Court or Tribunals which may have impact on the goingconcern status. No order has been passed by any Regulators or Court or Tribunals which mayhave impact on the Company`s operation in future.

Internal Financial Controls:

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


The properties of the Company stand adequately insured against risks offire strike riot earthquake explosion and malicious damage.


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

(a) In the preparation of the annual accounts the applicableaccounting standards have been followed along with proper explanation relating to materialdepartures.

(b) The Directors have selected such accounting policies and appliedthem consistently and made judgments and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the Loss of the Company for that period.

(c) The Directors have taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities.

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

(e) The Directors have laid down internal financial controls asrequired by Explanation to Section 134(5) (e) of the Act to be followed by the Company andsuch internal financial controls are adequate and are operating effectively.

(f) The Directors have devised proper systems to ensure compliance withthe provisions of applicable laws and such systems are adequate and operating effectively.


There was no employee drawing remuneration requiring disclosure underthe Rule 5 ( 2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules2014.

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


The Equity Shares of the Company are listed on BSE Limited and CalcuttaStock Exchange. The Company is regular in payment of listing fees. The Company has paidthe listing fees for the year 2019 – 2020.


It is proposed to appoint S M PANSURIYA & CO. CharteredAccountants Ahmedabad at the conclusion of the annual general meeting for the year 2019for a period of five years. The Company has received a letter from S M PANSURIYA &CO. ( firm Registration No. 126729W ) Chartered Accountants Ahmedabad granting consentto act as Statutory auditor of the Company and also confirming their eligibility to actStatutory auditor of the Company.

The existing term of M/s. Paresh Thothawala & Co. CharteredAccountants concludes at the annual general meeting for the year 2019.

The Company has received a certificate from the Auditors to the effectthat their appointment if made would be within the prescribed limits under Section141(3)(g) of the Companies Act 2013

The auditors observations and its reply are as under :

Basis for Qualified Opinion

1. Note No. 22tothe standalone financial results regarding Nonprovision of interest of Rs. 549.64Lacs onNPA accountsfor the year under considerationTheexactamounts of the said non provisions of interest are not determined and accounted forby the Company and tothat extent Bankers loan liabilities are understatedandlossisunderstated.


The interest provision on loan of Punjab and Sindh Bank has not beenaccounted due to legal dispute. The Honourable Calcutta High Court larger Bench has ruledin favor of the Company. However the Bank has preferred an appeal to the HonourableSupreme Court of India. The matter pending before legal forum and hence the same is notaccounted for.

2. Note No.16to the standalone financial results regardinguncertainties relating to recoverability of loans & advances given to M/s. GatewayCommodities (P) Ltd. amounting to Rs. 51401172/-(Previous year Rs. Rs. 53644817/-)and Non Provision of interest @ 9% of Rs. 4693172/-as at 31st March 2019. Themanagement has explained that such advances have been given in the normal course ofbusiness. The management based on internal assessments and evaluations have representedthat the balance outstanding advances are still recoverable/ adjustable and that noaccrual for diminution of advances is necessary as at balance sheet date and theaforementioned balances are fully recoverable. However we are unable to ascertain whetherall the remaining outstanding advances as above are fully recoverable / adjustable sincethe outstanding balancesas at balance sheet date are outstanding for a long period oftime. In the absence of sufficient appropriate evidence we are unable to comment upon thecarrying value of these loans & advances and recoverability of the aforesaid dues andthe consequentialimpact if any on the accompanying standalone financial statements. Ouraudit opinion on the standalone financial statements for the year ended 31 March 2019wasalso qualified in respect of this matter.

Reply :

The Company is in the process of making recovery of trade receivablesand loans and advances. The Company is exploring all legal options for the same. It couldbe seen from the qualification itself that there is a reduction in the outstanding amount.

3. Note No. 5 to the standalone financial statements regarding takingphysical and/ or symbolical possession and initiating auction process on various assets bylenders; however the company has received stay order against these proceedings and matteris sub-judicial till date. The management has not performed any impairment assessment forthese assets. Accordingly we are unable to ascertain the appropriateness of the carryingvalue of these assets and consequential impact if any on the accompanying standalonefinancial statements. Our audit opinion on thestandalone financial statements for the yearended 31 March2019was also qualified in respect of this matter.

Reply to above Qualifications : In reply to the above mentionedqualification your Directors state that the attachment of properties by the Bank is alegal process and the Company is taking all legal steps to protect the property. TheProperties were given as security for the loan availed by Fairdeal Supplies Limited.Fairdeal Supplies Limited has reached an Settlement agreement with UCO Bank and also withThe Jammu and Kashmir Bank Limited. Consequent upon the paymentof the settlement amountwith Banks the Company expects to release the property.

4. Note No. 35.8 to the standalone financial statements regardingCorporate guarantee given against credit facilities availed by anassociate concernandnon-complianceofprescribedsectionunder the provisions of the erstwhile Companies Act 1956/Companies Act 2013 respectively and for which the Company has filed an application withrespective authority; however approval in this regard is pending till date. Due touncertain consequence in this matter we are unable to identify impact if any on standalonefinancial statement our audit opinion is qualified.

In reply to the above mentioned qualification of the IndependentAuditors' Report the Board of Directors hereby replies that the Company at the timewhen M/s. Fairdeal Supplies Limited a Group concern of the Company obtained the loan fromthe Banks the financial conditions and other prospects of M/s. Fairdeal Supplies Limitedwere excellent. The Board of Directors of the Company did not forecast that loan availedby M/s. Fairdeal Supplies Limited will be defaulted. The Bankers of M/s. Fairdeal SuppliesLimited have stipulated condition to give the collateral and guarantee for the facilitiesto be availed by the Fairdeal Supplies Limited.

The Board of Directors of the Company would further like to statethat it has already filed necessary petition before the respective authorities forcompounding the matter.


The details in respect of the conservation of energy technologyabsorption and foreign exchange earnings and outgo are more detailed in the Annexure I tothe Directors Report.


Pursuant to SEBI ( Listing Obligations and DisclosureRequirements )Regulations 2015 Management

Discussion & Analysis Corporate Governance Report andAuditor's Certificate regarding compliance to conditions of corporate governance aremade part of this Annual Report. The Management Discussion and Analysis which is attachedherewith and forms part of the report and which is attached as Annexure VII and theCorporate Governance Report which is attached herewith and forms part of the report andwhich is attached as Annexure VIII.

Related Party Transactions

All related party transactions that were entered into during the yearunder report were on an arm's length basis and in the ordinary course of business.There are no materially significant related party transactions made by the Company duringthe year. Related Party Transactions Policy is available on the website of the Company atwww. The details of transactions with the related party isprovided in . No advance is / was paid for entering into related party transactions. Theprices paid to the related party transactions are based on the ruling market rate at therelevant point of time. The requisite details in form AOC – 2 is attached herewith asAnnexure - II which forms part of the Directors Report

Particulars of Loans / Guarantees / Investment:

The details of the investments and loans provided are mentioned in noteno. 12 and 16 of the Balance Sheet. Members are requested to refer the same. Further withrespect to loans / investment to and from the related parties are more detailed in noteno. 35.5 of the Balance Sheet.

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

Code for Prevention of Insider Trading Practices

Pursuant to Securities and Exchange Board of India (SEBI) hasintroduced SEBI (Prohibition of Insider Trading) Regulations 2015 a new Code of Conductwas adopted by the Company with effect from 1st April 2019. The Company hasalso adopted a policy and procedure for enquiry in case of leak of sensitive andunpublished price information. The Company has instituted a comprehensive code of conductin compliance with the SEBI regulations on prevention of insider trading. The code laysdown guidelines which advise on procedures to be followed and disclosures to be madewhile dealing in shares of the Company and cautions on the consequences ofnon-compliances. The Code is also available on the website of the Company

Risk Management Policy

The Company has a structured risk management policy. The Riskmanagement process is designed to safeguard the organisation from various risks throughadequate and timely actions. It is designed to anticipate evaluate and mitigate risks inorder to minimize its impact on the business. The potential risks are inventoried andintegrated with the management process such that they receive the necessary considerationduring decision making. It is dealt with in greater details in the management discussionand analysis section. The Risk Management Policy is also available on the Company`swebsite at

Declaration by Independent Directors:

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

(A) Mr. Virendra Sharma (B) Mr. Rajesh Vasantlal Tripathi (C) Mr.Sanket Dipakbhai Sheth (D) Mrs. Aarefa Kutub Kapasi

The Company has received requisite declarations/ confirmations from allthe above Directors confirming their independence.

Extract of the Annual Return

Pursuant to provision of Section 92 and 134 and other applicableprovision of the Companies Act 2013 and of Rule 12 (1) of Companies (Management andAdministration) Rules 2014 the extract of the annual return in form MGT 9 for theFinancial Year ended on 31st March 2019 is annexed as Annexure III to this Report.

Number of Board Meetings

During the year the Board of Directors met 10 times ( includingadjourned meetings). The dates of the Board meetings are as under :

02.04.2018 30.05.2018 14.06.2018 14.08.2018 17.08.2018 14.11.201813.02.2019 14.02.2019 08.03.2019and29.03.2019

Corporate Social Responsibility:

The Company is not covered under the criteria of the provision ofSection 135 of the Companies Act 2013 read with the Companies (Corporate SocialResponsibility Policy) Rules 2014 and therefore it is not mandatory for the Company tohave the Corporate Social Responsibility.

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

The Company has in place an Anti-harassment policy in line with therequirements of the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013. Internal Complaint Committee are set up at shop floor level toredress complaints received regularly and are monitored by women line supervisors whodirectly report to the Chairman. All employees (permanent contractual temporarytrainees) are covered under the policy. There was no compliant received from any employeeduring the financial year 2018-19 and hence no complaint is outstanding as on 31.03.2019for redressal.

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


The Company has complied with the mandatory Secretarial Standardsissued pursuant to Section 110 of the Companies Act 2013.


Pursuant to Section 204 of the Act the Secretarial Audit Report forthe Financial Year ended 31st March 2019 given by M/s. Jalan Alkesh & AssociatesPractising Company Secretary is annexed as Annexure IV to this Report.

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

A ) Non filing and / or Delayed filing of certain forms with theMinistry of Corporate Affairs required under the Companies Act 2013. However for latefiling of forms the Company has paid additional fees.

Reply : The Company will take the necessary steps to ensure the duecompliance of the law in time so that the Company do not have to pay additional fees forthe same.

B) The Company has given Security / Guarantee to the Bankers for theloans obtained by M/s.

Fairdeal Supplies Limited in violation of erstwhile Companies Act 1956which is still continuing.

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

C) Further with respect to the advances to M/s. Gateway CommoditiesPvt. Ltd. we request the members to refer the Balance Sheet and the Statutory AuditorsReport remarks. The advances to M/s. Gateway Commodities Private Limited were given underthe erstwhile Companies Act 1956.

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

D) There was delay in submission of results for the quarter ended on 30thJune 2018 and consequently the BSE has imposed penalty for the same.

E) The quarter and year end results for the year ended on 31st March2018 were required to be submitted to the exchange latest by 30th May 2018. However samewas not declared in time and consequently BSE has imposed penalty for the same.

Reply for D and E : Due to implementation of IND AS the delayhas occurred. 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 The Company has takennecessary steps in this regard and will take care that in future the delay does not occur.


In compliance with the provisions of the Act and SEBI ( ListingObligations and Disclosure Requirements ) Regulations 2015 the performance evaluation wascarried out as under:


In accordance with the criteria suggested by The Nomination andRemuneration Committee the Board of Directors evaluated the performance of the Boardhaving regard to various criteria such as Board composition Board processes Boarddynamics etc. The Independent Directors at their separate meetings also evaluated theperformance of the Board as a whole based on various criteria. The Board and theIndependent Directors were of the unanimous view that performance of the Board ofDirectors as a whole was satisfactory.

Committees of the Board:

The performance of the Audit Committee the Nomination and RemunerationCommittee and the Stakeholders Relationship Committee was evaluated by the Board havingregard to various criteria such as committee composition committee processes committeedynamics etc. The Board was of the unanimous view that all the committees were performingtheir functions satisfactorily and according to the mandate prescribed by the Board underthe regulatory requirements including the provisions of the Act the Rules framedthereunder and SEBI ( Listing Obligations and Disclosure Requirements ) Regulations 2015.

Individual Directors:

(a) Independent Directors: In accordance with the criteriasuggested by The Nomination and Remuneration Committee the performance of eachindependent director was evaluated by the entire Board of Directors (excluding thedirector being evaluated) on various parameters like engagement leadership analysisdecision making communication governance and interest of stakeholders. The Board was ofthe unanimous view that each independent director was a reputed professional and broughthis/her rich experience to the deliberations of the Board. The Board also appreciated thecontribution made by all the independent directors in guiding the management in achievinghigher growth and concluded that continuance of each independent director on the Boardwill be in the interest of the Company.

(b) Non-Independent Directors: The performance of each of thenon-independent directors (including the chair person) was evaluated by the IndependentDirectors at their separate meeting. Further their performance was also evaluated by theBoard of Directors. The various criteria considered for the purpose of evaluation includedleadership engagement transparency analysis decision making functional knowledgegovernance and interest of stakeholders. The Independent Directors and the Board were ofthe unanimous view that each of the non-independent directors was providing good businessand people leadership


The requisite details as required by Section 134(3) (e) Section 178(3)& (4) andSEBI ( Listing Obligations and Disclosure Requirements ) Regulations 2015 isattached herewith and forms part of the Directors Report. The details of the remunerationpolicy of the Company as required in terms of the SEBI ( Listing Obligations andDisclosure Requirements ) 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 2014are provided in Annexure VI of the Report.


There are no material changes and commitments if any affecting thefinancial position of the Company subsequent to the date of the Balance sheet and up tothe date of the report.


The various Policies required to be adopted by the Company pursuant toprovision of the Companies Act 2013 and SEBI ( Listing Obligations and DisclosureRequirements ) 2015 are placed upon the website of the Company i.e.


Your Directors acknowledge the continued support and cooperationreceived from the Central Government Shareholders Banks and other Lenders suppliers andDealers.

The Board also wishes to record its sincere appreciation of the totalcommitment dedication and hard work put in by every member of Frontline Group.