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Latent Light Finance Ltd.

BSE: 539909 Sector: Financials
NSE: N.A. ISIN Code: INE515K01018
BSE 05:30 | 01 Jan Latent Light Finance Ltd
NSE 05:30 | 01 Jan Latent Light Finance Ltd

Latent Light Finance Ltd. (LATENTLIGHT) - Director Report

Company director report


The Members


Your directors have pleasure in presenting their 32nd Annual Report togetherwith the Audited Statement of Accounts for the year ended on 31st March 2017.


Particulars For the financial year 2016-17 For the financial year 2015-16
GrossTotal Income 16886673 8867548
Less: Total Expenditures 11555416 4922848
Net Profit before tax 5331257 3944700
Less: Tax Expenses
- Provision for Income Tax-Current 1014804 751663
- Deferred Tax (108406) (191935)
- MAT Credit Availed 391698 342467
Profit after tax 4033161 3042505
Provision for transfer to Special Reserve Fund 806632 608501

In order to comply with the provisions of Reserve Bank of India Act 1934 the Companyhas transferred Rs.806632/-(Rupees Eight Lakhs Six Thousand Six Hundred and Thirty Twoonly) to Special Reserve Funds and has also made provision of Rs. 169053- (Rupees OneLakh Six ty Nine Thousand and Fifty three Only) for Standard Assets during the year underreview.

Except as mentioned above no amount was proposed to transfer to any reserve by theCompany during the year under review.


During the year under review the Company was engaged in carrying on the business asNon -Banking Financial Company without accepting public deposit for which the Certificateof Registration has been obtained from the Department of Non-Banking Supervision ReserveBank of India New Delhi. The Company has provided / taken inter-corporate loans inordinary course of business and on arm length basis. Your directors also intend todiversify its operation into another area / business in order to make the Company moreprofitable.


During the year under review the Company's total income is Rs. 16886673/- (RupeesSixteen Crores Eighty Eight Lakhs Six Thousand Six Hundred and Seventy Three only) ascompared to Rs. 8867548/- (Rupees Eighty Eight Lacs Sixty Seven Thousand Five Hundredand Forty Eight only) in the previous year

and the Company earned a profit after tax of Rs. 4033161/-(Rupees Forty Lakhs ThirtyThree Thousand One Hundred and Sixty One only) as compared to Rs. 608501/- (Rupees SixLakhs Eight Thousand Five Hundred and One only) in the previous year.


Your directors do not recommend any dividend for payment to the shareholders/ membersof the Company for the financial year ended on 31st March 2017.


Pursuant to the provisions of section 149 of the Act Mr. Virendra Singh Chowhan andMs. Sangeeta Bhardwaj are the independent directors of the Company. They have submitted adeclaration that each of them meets the criteria of independence as provided in section149(6) of the Act and there has been no change in the circumstances which may affect theirstatus as independent director during the year.

During the year under review the non-executive directors of the Company had nopecuniary relationship or transactions with the Company other than the sitting feescommission and reimbursement of expenses incurred by them for the purpose of attendingmeetings of the Company.

Mr. Deepak Nagar Director of the Company retires by rotation and being eligible hasoffered himself for reappointment. Your Directors recommend his re-appointment as directorof the Company.

As required under regulation 36(3) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the information on the particulars of the Directorsproposed for appointment / reappointment has been given in the Notice of the AnnualGeneral Meeting.

Board Evaluation

Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Board has carried out an evaluation of itsown performance the directors individually as well as the evaluation of the working ofits Audit Committee Nomination and Remuneration Committee..

Remuneration Policy

The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of directors senior management and to fixtheir remuneration.


During the year under review Eight (8) Board Meetings were convened and held. Theintervening gap between the Board meetings was within the period prescribed under theCompanies Act 2013.


Pursuant to the provisions of section 203 of the Act the key managerial personnel ofthe Company are - Mr. Dharmender Singhal Chief Financial Officer Mr. Kapil SinghalChief Executive Officer and Mr. Yash Gupta Company Secretary of the Company.


The Company has connectivity with NSDL & CDSL for dematerialization of its equityshares. The ISIN No. INE515K01018 has been allotted for the Company. Therefore theinvestors may keep their shareholding in the electronic mode with their DepositoryParticipates.

As on 31st March 2017 only 78% (Approx) of the Company's paid up EquityShare Capital is in dematerialized form and balance 22 % (Approx) is in physical form. TheCompany's Registrars & Transfer Agent is M/s Indus Portfolio Private Limited havingtheir communication office at G-65 Bali Nagar New Delhi-110015.


As required under regulation 34 of SEBI (Listing Obligation and DisclosureRequirements) Regulations 2015 the Management Discussion and Analysis Report is enclosedas a part of this report.


The Board of Directors acknowledges the responsibility for ensuring compliance with theprovisions of section 134(3)(c) read with section 134(5) of the Companies Act 2013 in thepreparation of the Financial Statement for the financial year ended on 31stMarch 2017 and state:

i) That in the preparation of Annual Accounts for the financial year ended as at 31stMarch 2017 the applicable Accounting Standards have been followed along with properexplanation relating to the material departures.

ii) That the Directors have selected such Accounting Policies and applied themconsistently and made judgements and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the financial yearended as at 31st March 2017 and of the profit and loss of the Company for thefinancial year ended on 31st March 2017.

iii) That the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe Assets of the Company and for preventing and detecting fraud or other irregularities.

iv) That the Directors have prepared the Annual Accounts on a Going Concern basis.

v) The Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and

vi) There is a proper system to ensure compliance with the provisions of all applicablelaws and that such systems are adequate and operating effectively.

Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company work performed by the internal statutory andsecretarial auditors and external consultants including audit of internal financialcontrols over financial reporting by the statutory auditors and the reviews performed bymanagement and the relevant board committees including the audit committee the board isof the opinion that the Company's internal financial controls were adequate and effectiveduring financial year 2016-17.


The Company has not invited or accepted any public deposits within the meaning ofSection 73 of the Companies Act 2013 and the rules made thereunder and section 45-I(bb)of the Reserve Bank of India Act 1934 during the year under review. The Company does nothold any public deposit as on date and will not accept the same in future without theprior approval of Reserve Bank of India in writing.


The Company being a non-banking finance company registered with the Reserve Bank ofIndia and engaged in the business of giving loans or finance & investment activitiesis exempt from complying with the provisions of section 186 of the Companies Act 2013.Accordingly the disclosures of the loans given as required under the aforesaid sectionhave not been given in this Report.


The Company has proper and adequate system of internal control geared towards achievingefficiency in its operations safeguarding assets optimum utilization of resources andcompliance with statutory regulations. The Company has an Internal Control Systemcommensurate with the size scale and complexity of its operations. Testing of suchInternal Control measures and systems forms a part of Internal Audit function. TheInternal Auditors of the Company conduct audits of various departments based on an annualaudit plan covering key areas of operations. Internal Audit reviews and evaluates theadequacy and effectiveness of internal controls ensuring adherence to operatingguidelines and systems and recommending improvements for strengthening them. To maintainits objectivity and independence the Internal Audit function reports to the Chairman ofthe Audit Committee of the Board. The Audit Committee of the Board of Directors reviewsthe adequacy of internal controls. This has improved the management of the affairs of theCompany and strengthened transparency and accountability. The Management ensures adherenceto all internal control policies and procedures as well as compliance with regulatoryguidelines. No significant audit observations and recommendations have been received fromthe Internal Auditors of the Company.


The Company has at its meeting held on 12th August 2016 appointed M/sRachit Malhotra & Associates a firm of Company Secretaries in practice to undertakethe Secretarial Audit of the Company for the financial year 2016 -17 in terms ofprovisions of section 204 of the Companies Act 2013 read with the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014. Report of the Secretarial Auditorfor the Financial ended 31st March 2017 is attached as an annexure as Annexure- "A" which forms part of this report.

Further the statutory auditors' report and secretarial auditors' report does notcontain any qualifications reservations or adverse remarks.



Pursuant to the provision of section 139(2) of the Companies Act 2013 read with therules made thereunder no listed Company shall appoint or re-appoint an audit firm asauditors for more than two terms of five consecutive years. Any audit firm has beenfunctioning for than 10 or more years in the Company as statutory auditors of the Companysuch audit firm can be appointed as auditors in same Company for a further period of threefinancial years only. M/s Mamraj & Co. Chartered Accountants has been functioning formore than 10 years in the Company and they had been appointed as Auditors for a period ofthree years by the members/ shareholders at their Annual General Meeting held on 30thSeptember 2014. Their term will expire on date of conclusion of this Annual GeneralMeeting.

Therefore pursuant to Section 139 142 and other applicable provisions of theCompanies Act 2013 and the Rules made thereunder pursuant to the recommendations of theaudit committee of the Board of Directors M/s Divyank Khullar & Associates CharteredAccountants New Delhi (Firm Regn. No.:- 025755N) shall be appointed as Statutory Auditorsof the Company in place of M/s Mamraj & Co. Chartered Accountants retiring auditorsof the Company to hold office from the date of conclusion of the 32nd AGM ofthe Company till the date of conclusion of 37th Annual General Meeting to beheld for the financial year ending on 31st March 2022 subject to ratificationof their appointment at every Annual General Meeting of the Company.

The Company has obtained a written consent from M/s Divyank Khullar & AssociatesChartered Accountants New Delhi for their appointment and also a obtained certificate tothe effect that their appointment if made would be in accordance with Section 139(1) ofthe Companies Act 2013 and the rules made there under as may be applicable.


Pursuant to the provisions of section 204 of the Companies Act 2013 read with rule theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Companyhas at its meeting held

on 14th August 2017 appointed M/s Rachit Malhotra & Associates a firmof Company Secretaries in practice to undertake the Secretarial Audit of the Company forthe financial year 2017-18.


The details forming part of the extract of the Annual Return in form MGT-9 is annexedherewith as "Annexure B".


During the year under review the main business of the company is financing &investment in shares and granting inter-corporate loans. All related party transactionsentered into with related parties were placed before the Audit Committee for theirapproval at commencement of the financial year. The audit committee decided that suchtransactions are in the ordinary course of business and are on arm's length basis. None ofthe transactions with related parties fall under the scope of section 188(1) of theCompanies Act 2013. Even though the provisions of Companies Act 2013 read with rulesmade thereunder regarding related party transactions are not attracted to suchtransactions as these are in ordinary course of business and on an arm's length basis butsome transactions were material related party transaction by virtue of SEBI (LODR)Regulations 2015. All related party transactions so entered are disclosed in FinancialStatement of the Company as attached herewith. Information on all transactions withrelated party pursuant to section 134(3)(h) of the Act read with rule 8(2) of theCompanies (Accounts) Rules 2014 are also annexed in Form AOC-2 and the same forms part ofthis report.


The Board of Directors has approved a Code of Conduct which is applicable to themembers of the Board and all employees in the course of day to day business operations ofthe Company.

The Code lays down the standard procedure of business conduct which is expected to befollowed by the Directors and the designated employees in their business dealings and inparticular on matters relating to integrity in the work place in business practices andin dealing with stakeholders. All the Board Members and the Senior Management personnelhave confirmed compliance with the Code.


Pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013 readwith the rules made thereunder and pursuant to the provision of SEBI (Listing Obligationsand Disclosure Requirements) 2015 the Company has established a Vigil Mechanism to beknown as the ‘Whistle Blower Policy' for its Directors and Employees to reportinstances of unethical behaviour actual or suspected fraud or violation of the Company'sCode of Conduct. The aim of the policy is to provide adequate safeguards againstvictimization of Whistle Blower who avails of the mechanism and also provide direct accessto the Chairman of the Audit Committee in appropriate or exceptional cases.

Accordingly Vigil Mechanism / Whistle Blower Policy have been formulated with a viewto provide a mechanism for the Directors and employees of the Company to approach theEthics Officer or the Chairman of the Audit Committee of the Company.

The purpose of this policy is to provide a framework to promote responsible and securewhistle blowing. It protects employees willing to raise a concern about seriousirregularities within the Company.

During the financial year 2016-17 no such complaint of unethical or improper activityhas been received by the Company


The Company has adopted a Code of Conduct for Prevention of Insider Trading with a viewto regulate trading in securities by the Directors and designated employees of theCompany. The Code requires preclearance for dealing in the Company's shares and prohibitsthe purchase or sale of Company shares by the Directors and the designated employees whilein possession of unpublished price sensitive information in relation to the Company andduring the period when the trading window is closed. The Board is responsible forimplementation of the Code. All Board of Directors and the designated employees haveconfirmed compliance with the Code.


During the year under review the provisions of Section 134(3)(m) of the Companies Act2013 read with Rule 8 of the Companies (Accounts) Rules 2014 are as follows:

Conservation of Energy

Your Company carries out its business in an environmental friendly manner and is on thelook-out for different ways and means to reduce the consumption of energy in its businessactivity.

Technology Absorption Adaption and Innovation

The Company continues to use the latest technologies for improving quality of itsservices. The Company's business does not require significant import of technology.

Foreign Exchange Earnings and Outgo

There was no foreign exchange earnings and outgo in the Company during the financialyear.


There was no material changes and commitments affecting the financial position of thecompany which have occurred between the end of the financial year of the Company to whichthe financial statements relate and the date of the report;


During the year under review provision of section 135 and Schedule VII of theCompanies Act 2013 pertaining to Corporate Social Responsibility are not applicable toour Company. Hence details of expenditures on CSR activities are not required to befurnished.


Presently the Securities of the Company are listed on BSE Limited Mumbai. The listingfee for the financial year 2017-18 has been paid.


The Company has in place an Anti-Sexual Harassment Policy in line with the requirementsof the Sexual Harassment of Women at the Workplace (Prevention Prohibition &Redressal) Act 2013. Internal Complaints Committee (ICC) has been set up to redresscomplaints received regarding sexual harassment. All employees (permanent contractualtemporary trainees) are covered under this policy.

The following is a summary of sexual harassment complaints received and disposed-offduring the year 201617.

• No of complaints received : 0

• No of complaints disposed off : N.A.


Your directors would like to place their grateful appreciation for the assistance andco-operation received from the Company's bankers during the year under review. Thedirectors also acknowledge with appreciation the support and co-operation rendered byvarious Government Agencies and Departments. Your Directors would also wish to place onrecord their deep sense of appreciation for the continued support of all the investors ofthe Company.

By order and on behalf of the Board
Sd/- Sd/-
Place: New Delhi (Deepak Nagar) (Dharmender Singhal)
Date: 14th August 2017 Director Director
(DIN: 00043654) (DIN: 03257550)