TO THE MEMBERS
Your Director's have pleasure in presenting the Twenty Eighth Annual Report of theCompany together with the Audited Accounts for the year ended 31st March 2017.
The Performance of the Company for the financial year ended 31st March 2017is summarized below:
| || ||(Rs. in Lakhs) |
|PARTICULARS ||CURRENT YEAR ||PREVIOUS YEAR |
| ||(2016-17) ||(2015-16) |
|1. Total Income ||891.62 ||817.75 |
|Less: i) Operating Administrative & other Exp. ||817.63 ||750.06 |
|2. Earning before interest and depreciation ||73.99 ||67.69 |
|Less: i) Interest ||7.80 ||9.72 |
|ii) Depreciation ||70.06 ||64.82 |
|3. Profit before Tax ||(3.87) ||(6.84) |
|Less: provision for Tax || || |
|i) Current ||- ||- |
|ii) Deferred ||(0.87) ||(8.54) |
|iii) Earlier year Tax ||- ||- |
|iv) MAT Credit ||- ||- |
|4. Profit after Tax ||(3.00) ||1.70 |
|Add: Balance of Profit as per last Balance Sheet ||310.23 ||308.53 |
|Less: Adjustment of depreciation on account of change in estimated life of fixed assets ||- ||- |
|5. Balance available for appropriation ||307.23 ||310.23 |
During the year under review the Company has total revenues of 891.62 Lakhs ascompared to 817.75 Lakhs during the previous year. The net loss for the year under reviewhas been 3 Lakhs against profit of 1.70 Lakhs during the previous year. Your directors arecontinuously looking for avenues for future growth of the Company in Hotel Industry.
Due to loss during the period under review no dividend has been recommended for theperiod under review.
The appropriations for the year are:
| || ||(Rs. in Lakhs) |
|PARTICULARS ||CURRENT YEAR ||PREVIOUS YEAR |
| ||(2016-17) ||(2015-16) |
|Securities Premium A/c as per last Balance ||40.50 ||40.50 |
|Sheet || || |
|Addition during the year ||- ||- |
|(a) ||40.50 ||40.50 |
|Balance in P&L A/c as per last Balance Sheet ||310.53 ||308.53 |
|Addition during the year ||(3.01) ||1.70 |
|Adjustment of depreciation on account of change in estimated life of fixed assets ||- ||- |
|(b) ||307.22 ||310.23 |
|Total Reserve & Surplus (a+b) ||347.72 ||350.73 |
PAID UP CAPITAL
| ||As at March 312017 ||As at March 312016 |
|PARTICULARS ||(Rs. in Lakhs) ||(Rs. in Lakhs) |
|SHARE CAPITAL || || |
|Authorised Shares ||1000.00 ||1000.00 |
|10000000 Equity Shares of ` 10 each || || |
|Issued Subscribed & fully paid up shares 9113200 Equity Shares of Rs.10 each fully paid up ||911.32 ||911.32 |
PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
Particulars of contracts Or arrangements with related parties referred to in Section188(1) of the Companies Act2013 in the prescribed form AOC-2 is appended as Annexure-III to the Board's Report.
All contracts / arrangements / transactions entered by the Company during the financialyear with related parties were in the ordinary course of business and on an arm's lengthbasis. During the year the Company had not entered into any contract / arrangement /transaction with related parties which could be considered material in accordance with thepolicy of the Company on materiality of related party transactions. The Policy onmateriality of related party transactions and dealing with related party transactions asapproved by the Board may be accessed on thehttp://www.howardhotelsltd.com/reports/1434531522PolicyonMaterialityofRelatedPartyTransactionsandDealing.pdf
PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIES PROVIDED
Loans guarantees and investments covered under Section 186 of the Companies Act 2013form part pf the notes to the financial statements provided in this Annual Report.
ACCEPTANCE OF DEPOSITS
The Company has not accepted any deposits from public within the meaning of Section 73of the Companies Act 2013 and the Companies (Acceptance of Deposit) Rules 2014 duringthe year under review.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form MGT-9 as requiredunder Section 92 of the Companies Act 2013 is annexed as Annexure - I and formsan integral part of this Report.
MEETINGS OF THE BOARD
During the financial year ended March 31 2017 07 (Seven) meetings of the Board wereheld as follows:
|S. No. ||Dates of Board Meeting ||Board Strength ||No. of directors present |
|01. ||May 17 2016 ||6 ||4 |
|02. ||May 30 2016 ||6 ||5 |
|03. ||August 5 2016 ||6 ||5 |
|04. ||November 11 2016 ||6 ||4 |
|05. ||January 23 2017 ||6 ||4 |
|06. ||February 10 2017 ||6 ||4 |
|07. ||March 01 2017 ||6 ||4 |
*The maximum time gap between two meetings was not more than 120days.
CODE OF CONDUCT
The Company's Code of Conduct as adopted by the Board of Directors is applicable toall Directors Senior Management and Employees of the Company. The Code of Conduct of theCompany covers substantial development disclosure of material information integrity offinancial reporting continuous improvement of the internal control system and soundinvestor relations. The same can be assessed athttp://www.howardhotelsltd.com/reports/1434531313CodeofConduct.pdf
POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION
The current policy is to have an appropriate mix of executive and independent directorsto maintain the independence of the Board and separate its functions of governance andmanagement. As on March 31 2017 The Board consist of 6 members three of whom areexecutive/whole-time directors and three are independent directors. The Board periodicallyevaluates the need for change in its composition and size. The policy of the Company ondirector's appointment and other matters provided under sub section 3 of section 178 ofthe Companies Act 2013 can be assessed athttp://www.howardhotelsltd.com/reports/1434531471PolicyforSelectionofDirectorsandDeterminingIndependence.pdf
DECLARATION BY INDEPENDENT DIRECTORS
The Company has received necessary declaration from each independent director underSection 149(7) of the Companies Act 2013 that he / she meets the criteria ofindependence laid down in Section 149(6) of the Companies Act 2013 and Regulation 25 ofSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
The board of directors has carried out an annual evaluation of its own performanceboard committees and individual directors pursuant to the provisions of the Act and thecorporate governance requirements as prescribed by Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 ("SEBI ListingRegulations").
The performance of the board was evaluated by the board after seeking inputs from allthe directors on the basis of the criteria such as the board composition and structureeffectiveness of board processes information and functioning etc. The performance of thecommittees was evaluated by the board after seeking inputs from the committee members onthe basis of the criteria such as the composition of committees effectiveness ofcommittee meetings etc.
The board and the nomination and remuneration committee reviewed the performance of theindividual directors on the basis of the targets/criteria such as the contribution of theindividual director to the board and committee meetings like preparedness on the issues tobe discussed meaningful and constructive contribution and inputs in meetings etc. Inaddition the chairman was also evaluated on the key aspects of his role. In a separatemeeting of independent directors performance of non-independent directors performance ofthe board as a whole and performance of the chairman was evaluated taking into accountthe views of executive directors and non-executive directors. The same was discussed inthe board meeting that followed the meeting of the independent directors at which theperformance of the board its committees and individual directors was also discussed.Performance evaluation of independent directors was done by the entire board excludingthe independent director being evaluated.
The Company has devised a policy for performance evaluation of Independent DirectorsBoard Committees and other Individual directors which includes criteria for evaluation ofthe non-executive directors which can be accessed athttp://www.howardhotelsltd.com/reports/1434531471PolicyforSelectionofDirectorsandDeterminingIndependence.pdfand http://www.howardhotelsltd.com/reports/1435316045Nomination&RemunerationPolicy.pdf
DIRECTORS AND KEY MANAGERIAL PERSON
Pursuant to the provisions of section 149 of the Act Mr. Rakesh Kumar Agarwal Mr.Ravi Kant Bansal and Mrs. Alka Agarwal are Non-Executive Independent directors of theCompany. They have submitted a declaration that each of them meets the criteria ofindependence as provided in section 149(6) of the Act and Regulation 16 (b) of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.There has been nochange in the circumstances which may affect their status as independent director duringthe year.
Mr. Nirvikar Nath Mittal retires by rotation and being eligible has offered him forre-appointment in the ensuing AGM.
During the year the non-executive directors of the Company had no pecuniaryrelationship or transactions with the Company other than the sitting fees commission andreimbursement of expenses incurred by them for the purpose of attending meetings of theCompany. Pursuant to the provisions of section 203 of the Act the key managerialpersonnel of the Company are Mr. Nirankar Nath Mittal Chairman & Managing DirectorMr. Nirvikar Nath Mittal Whole time Director Mr. Shri Kant Mittal Whole time DirectorMs. Gazal Mittal Company Secretary. Ms. Gazal Mittal has been appointed as a CompanySecretary of the Company w.e.f. 17th May 2016.
The detail of no. of directorship of each director in other Public Company andmembership & chairmanship in the Company's Committees and other Public Company'sCommittees are as under:
| || || || |
In committees of the Company
**In committees of other public companies
|Name of Director ||Category ||*No. of directorship in other public companies ||Chairmanship ||Membership ||Chairmanship ||Membership |
|Nirankar Nath Mittal ||Executive ||NIL || || ||NIL ||NIL |
|Nirvikar Nath Mittal ||Executive ||NIL || || ||NIL ||NIL |
|Shri Kant Mittal ||Executive ||NIL ||- ||- ||NIL ||NIL |
|Rakesh Kumar Agarwal ||Independent Non-Executive ||NIL ||2 ||1 ||NIL ||NIL |
|Alka Agarwal ||Independent Non-Executive ||NIL || ||3 ||NIL ||NIL |
|Ravi Kant Bansal ||Independent Non-Executive ||NIL ||1 ||2 ||NIL ||NIL |
*** The directorship held by directors do not include alternate directorship anddirectorship of foreign Companies section 8 Companies & private limited Companies.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(3)(c) of the Companies Act 2013 we hereby state:
i).that in the preparation of the Annual Accounts the applicable accountingstandards have been followed along with proper explanation and that there are no materialdepartures;
ii).that the directors have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at March 31 2017 andof the profit and loss of the Company for that period;
iii).that the directors have taken proper and sufficient care for the maintenanceof adequate accounting records in accordance with the provisions of the Companies Act2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
iv).that the directors have prepared the Annual Accounts on a going concern basis.
v).that the directors have laid down internal financial controls to be followed bythe company and that such internal financial controls are adequate and were operatingeffectively.
vi). that the directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
POLICY ON SEXUAL HARASSMENT OF EMPLOYEES
The Company has adopted a policy on prevention prohibition and redressal of sexualharassment at workplace in line with the provisions of the Sexual Harassment of employeesat Workplace (Prevention Prohibition and Redressal) Act 2013 (India) and the Rulesthereunder. No complaints have been received on Sexual Harassment of employees inFY 2016-17. The policy can be assessed athttp://www.howardhotelsltd.com/reports/1434531591SexualHarrassmentPolicy.pdf
AUDITORS AND AUDITORS' REPORT
M/s. P. C. Bindal & Co. Chartered Accountants New Delhi the Statutory Auditorsof the Company are the retiring Auditors and being eligible offers themselves forre-appointment for financial year 2017-18. The Certificate u/s 139(1) of the CompaniesAct 2013 has been obtained from them and they are not disqualified for suchre-appointment within the meaning of Section 141 of the said Act.
The Board of Directors on the recommendation of Audit Committee has re- appointedM/s. P. C. Bindal & Co. Chartered Accountants as Statutory of the Company for thefinancial year 2017-18. As required under the Companies Act 2013 a resolution seekingmember's approval for the re-appointment of the Statutory Auditor for F.Y. 2017-18 formspart of the Notice convening the Annual General Meeting.
There is no Audit qualification for the year under review.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and rules madethereunder the Company has appointed M/s Satyendra Sharma & Associates a firm ofCompany Secretaries in Practice (C.P.No.4843) to undertake the Secretarial Audit of theCompany. The Secretarial Audit Report in Form MR-3 is annexed as Annexure - II andforms an integral part of this Report.
There is no secretarial audit qualification for the year under review.
The Company's internal control system is commensurate with its size scale andcomplexities of its operations. The internal and operational audit is entrusted to CAChirag Jain & Co a reputed firm of Chartered Accountants. The main thrust of internalaudit is to test and review controls appraisal of risks and business processes besidesbenchmarking controls with best practices in the industry.
The Audit Committee of the Board of Directors actively reviews the adequacy andeffectiveness of the internal control systems and suggests improvements to strengthen thesame.
The Audit Committee of the Board of Directors and Statutory Auditors are periodicallyapprised of the internal audit findings and corrective actions taken. Audit plays a keyrole in providing assurance to the Board of Directors. To maintain its objectivity andindependence the Internal Audit function reports to the Chairman of the Audit Committee.
There is neither any regulatory action initiated nor pending under SEBI or Company Lawduring the financial year 2016-17.
CASH FLOW ANALYSIS
The Cash Flow Statement for the year 2016-17 is annexed with the Annual Accounts of theCompany.
EXPLANATIONS / COMMENTS BY BOARD OF DIRECTORS ON ADVERSE REMARK MADE BY AUDITOR
There are no qualifications reservations or adverse remarks or disclaimers made byP.C. Bindal & Co. Chartered Accountants Statutory Auditors in their Audit reportand by Mr. Satyendra Sharma Company Secretary in Practice in his Secretarial AuditReport.
The Company has 3 Board Level Committees. All decisions and recommendations of theCommittees are placed before Board for information and approval. The role and compositionof these Committees including the number of meetings held during the financial year andthe related attendance are provided below:
A. Audit Committee
B. Nomination & Remuneration Committee
C. Stakeholder's Relationship Committee.
A. AUDIT COMMITTEE
The composition quorum powers role and scope are in accordance with Section 177 ofthe Companies Act 2013 and the provisions of Regulation 18 of the SEBI (LODR)Regulations2015. Mr. Rakesh Kumar Agarwal Non Executive Independent Director is the Chairperson ofthe Audit Committee. The other members of the Audit Committee include Mr. Ravi Kant Bansaland Mrs. Alka Agarwal. All the recommendations made by the Audit Committee were acceptedby the Board. During the financial year ended March 31 2017 4 (Four) meetings of theAudit Committee were held as follows:
|S. No. ||Date ||Committee Strength ||No. of Members present |
|01. ||May 30 2016 ||3 ||2 |
|02. ||August 05 2016 ||3 ||2 |
|03. ||November 11 2016 ||3 ||2 |
|04. ||February 10 2017 ||3 ||2 |
B. NOMINATION & REMUNERATION COMMITTEE
The composition quorum powers role and scope are in accordance with Section 178 ofthe Companies Act 2013 and the provisions of Regulation 19 of the SEBI (LODR)Regulations 2015. Mr. Rakesh Kumar Agarwal Non Executive Independent Director is theChairperson of the Nomination & Remuneration Committee. The other members of theNomination & Remuneration Committee include Mr. Ravi Kant Bansal and Mrs. AlkaAgarwal. During the financial year ended March 31 2017 1 (One) meeting of the Nomination& Remuneration Committee was held as follows:
|S. No. ||Date ||Committee Strength ||No. of Members present |
|01. ||August 12 2016 ||3 ||2 |
Moreover the Company's Nomination & remuneration policy for Directors Keymanagerial personnel and other employees is posted on the website of the Company and canbe accessed athttp://www.howardhotelsltd.com/reports/1435316045Nomination&RemunerationPolicy.pdf
C. STAKEHOLDERS' RELATIONSHIP COMMITTEE
The composition quorum powers role and scope are in accordance with Section 178 ofthe Companies Act 2013 and the provisions of Regulation 20 of the SEBI (LODR)Regulations 2015. Mr. Ravi Kant Bansal Non Executive Independent Director is theChairperson of the Stakeholders' Relationship Committee. The other members of theStakeholders' Relationship Committee include Mr. Rakesh Kumar Agarwal and Mrs. AlkaAgarwal.
During the financial year ended March 31 2016 3 (Three) meetings of the Stakeholders'Relationship Committee were held as follows:
|S. No. ||Date ||Committee Strength ||No. of Members present |
|01. ||August 19 2016 ||3 ||2 |
|02. ||January 23 2017 ||3 ||2 |
|03. ||March 27 2017 ||3 ||2 |
? There were no pending share transfers/ investors' complaints as on March 31 2017.
ATTENDANCE OF DIRECTORS
The detail of Director's attendance in the Board Meeting and their Committees duringthe F.Y. ended as on March 31 2017 and in the last AGM of the Company is as follows:
|S. NO. ||Name of Director ||No. of Board Meeting attended out of 07 held during the year ||No. of audit Committee meetings attended ||No. of Nomination & Remuneration Committee meetings attended ||No. of Stakeholders Relationship Committee meetings attended ||Attendance at the last AGM |
|01. ||Nirankar Nath Mittal ||7 ||- ||- ||- ||YES |
|02. ||Nirvikar Nath Mittal ||7 ||- ||- ||- ||NO |
|03. ||Shri Kant Mittal ||7 ||- ||- ||- ||NO |
|04. ||Rakesh Kumar Agarwal ||7 ||4 ||1 ||3 ||YES |
|05. ||Ravi Kant Bansal ||1 ||1 ||1 ||2 ||NO |
|06. ||Alka Agarwal ||1 ||3 ||0 ||1 ||NO |
MEETINGS OF INDEPENDENT DIRECTORS
The Company's Independent Directors meet at least once in every financial year withoutthe presence of Executive Directors or management personnel. Such meetings are conductedinformally to enable Independent Directors to discuss matters pertaining to the Company'saffairs and put forth their views to the Lead Independent Director. The Lead IndependentDirector takes appropriate steps to present Independent Directors' views to the Chairmanand Managing Director. One meeting of Independent Directors was held during the year i.e.on 20th February 2017.
WHISTLE BLOWER POLICY & VIGIL MECHANISM COMMITTEE
The Company has adopted a Whistle Blower Policy and has established the necessary vigilmechanism as defined under Regulation 22 of SEBI Listing Regulations for directors andemployees to report concerns about unethical behaviour. During the year under review noemployee was denied access to the Audit Committee. The said policy has been also put up onthe website of the Company and can be accessed athttp://www.howardhotelsltd.com/reports/1432376932VIGILMECHANISMREPORT.pdf
PARTICULARS OF EMPLOYEES
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are annexed herewith marked as Annexure IV.
In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014during the year under review no employee whether employed for the whole or part of theyear was drawing remuneration in excess of the limits set out in the said rules. Hencethe details required under the said Rules are not given.
Having regard to the provisions of the first proviso to Section 136(1) of the Act andas advised. The full Annual Report including the aforesaid information is being sentelectronically to all those members who have registered their email addresses and isavailable on the Company's website.
Pursuant to regulation 15(2) of Securities Exchange Board of India (Listing Obligations& Disclosure Requirements) Regulations 2015 provisions of regulation 27 i.e.Corporate Governance and para C D & E of Schedule V of SEBI (LODR) Regulations 2015are not applicable to the Company.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The Management Discussion and Analysis of financial condition and results of operationof the Company for the year under review as required under Regulation 34 of SEBI (LODR)Regulations 2015 is given separately under the head "Management Discussion &Analysis Report" in Annual Report as Annexure-V.
ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Particulars required under Section 134 (3) (m) of the Companies Act 2013 read withRule 2 of the Companies (Disclosure of Particulars in the Report of Board of Directors)Rules 1988 are given as under:
A) Conservation of energy:
|(i) the steps taken or impact on conservation of energy; ||The Energy Conservation efforts in the Company are being pursued on a continuous basis and the Company is making its full efforts to minimize wastage and to make optimum utilization of energy. |
|(ii) the steps taken by the company for utilizing alternate sources of energy; ||N.A. |
|(iii) the capital investment on energy conservation equipments ; ||N.A. |
B) Technology absorption:
|(i) the efforts made towards technology absorption; ||N.A. |
|(ii) the benefits derived like product improvement cost reduction product development or import substitution; ||N.A. |
|(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)- ||N.A. |
|(a) the details of technology imported; ||N.A. |
|(b) the year of import; ||N.A. |
|(c) whether the technology been fully absorbed; ||N.A. |
|(d) if not fully absorbed areas where absorption has not taken ||N.A. |
|place and the reasons thereof; and ||N.A. |
|(iv) the expenditure incurred on Research and Development. || |
|C) Foreign Exchange Earnings & Outgo || || |
| || ||(Rs. in Lakhs) |
| ||March 312017 ||March 312016 |
|Total Foreign Currency Earned ||145.68 ||48.41 |
|Total Foreign Currency Outgo (traveling) ||0.00 ||0.00 |
Since our Company is engaged in the business of hospitality so there is only foreigncurrency earned from the ordinary business activities i.e. supply of service to theconsumers of any other country in India but there is no import activity so there is noforeign currency outgo.
CORPORATE SOCIAL RESPONSIBILITY
The Company has not constituted the Corporate Social Responsibility (CSR) Committee inaccordance with Section 135 of the Companies Act 2013 as the said provision is notapplicable to the Company.
The industrial relations remained cordial and peaceful throughout the year in theCompany. The Directors wish to place on record their appreciation for the contribution ofthe workers and officers of the Company at all level.
As the members are aware the Company's shares are compulsorily tradable in electronicform. As on March 31 2017 83.78% of the Company's paid-up capital representing 7634943Equity Shares is in dematerialized form with both the depositories as compared to 83.67%representing 7625638 equity shares for the previous year ended March 31 2016.
Your Company has established connectivity with both depositories - National SecuritiesDepository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) throughRTA i.e. M/s. Link Intime India Pvt. Ltd.
DISCLOSURES REGARDING SUBSIDIARIES JOINT VENTURES OR ASSOCIATE COMPANIES
During the Financial year 2016-17 neither Company has become nor ceased to be itssubsidiaries joint venture or associate company.
The Board acknowledges with gratitude the assistance co-operation and encouragementextended to the Company by Central Government State Government Financial InstitutionsSEBI Stock Exchanges Custodian Regulatory/Statutory Authorities Registrars & ShareTransfer Agent and other related Department of Tourism. Your directors thank thecustomers client vendors dealers Company's bankers and other business associates fortheir continuing support and unstinting efforts in the Company's growth. The Board alsowishes to place on record their deep appreciation for the commitment displayed by all theexecutives officers and staff resulting in successful performance during the year. Thecompany has achieved impressive growth through the competence hard work solidaritycooperation and support of employees at all levels. Your Directors are also thankful tothe stakeholders shareholder and depositors for their continued patronage.
| ||For & on behalf of Board of Directors of |
| ||HOWARD HOTELS LIMITED |
| ||Sd /- |
|Place: Agra ||Nirankar Nath Mittal |
|Date: 28.07.2017 ||(Chairman & Managing Director) |
| ||DIN: 01533102 |