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ICDS Ltd.

BSE: 511194 Sector: Financials
NSE: ICDSLTD ISIN Code: INE613B01010
BSE 05:30 | 01 Jan ICDS Ltd
NSE 05:30 | 01 Jan ICDS Ltd

ICDS Ltd. (ICDSLTD) - Director Report

Company director report

To

The Members

Your Board of Directors have pleasure in presenting their 46th Annual Report onthe business and operations of the Company and the accounts for the Financial Year endedMarch 31 2017.

FINANCIAL SUMMARY

The following table brings out the financial performance of the Company during the F.Y.2016-17:

(Rs. in ‘000)
31 March 31 March
2017 2016
Income from Operations 21951 39931
Other Income 3428 5112
Write back of provisions 10542 742
Total Income 35921 45785
Less: Operating Expenses 15127 40302
20794 5483
Less: Interest 738 1386
Profit/(Loss) before Depreciation 20056 4097
Less: Depreciation 1219 1240
Profit/(Loss) after Depreciation before Tax 18837 2857
Less: Provision for Income Tax/ (write back) 1678 200
Profit/(Loss) after Tax 17159 2657
Add : (Loss) brought forward (62062) (64719)
(Loss) carried forward (44903) (62062)

COMPANIES STATE OF AFFAIRS:

During the year under review the Company has earned income of Rs.3.59 Crores (includingsale of telephone handsets accessories and shares in stock in trade of Rs. 0.40 crores)as against Rs.4.58 Crores in the corresponding period of the previous year (which alsoincluded income from sale of telephone handsets and accessories of Rs.2.04 crores) fromrecovery of overdues from HP/Lease/Bills Discounting/ Loan Parties Commission frominsurance related activities service charges earned from telephone bill recoveryservices dividend and interest. The operating expense incurred during the reportingperiod was Rs.1.51 Crores as against Rs.4.03 Crores in the previous year. The accumulatedlosses which was at Rs.6.21 Crores as on 31st March 2016 has been reduced to Rs.4.49Crores on 31st March 2017. The net worth of the Company as on 31st March 2017 went up toRs. 11.87 Crores (Rs.10.15 Crores in the corresponding period of previous year).

Scheme of Arrangement

The details of unclaimed public liabilities with the Company as per the Scheme ofArrangement sanctioned by the Hon'ble High Court of Karnataka have been covered in theCorporate Governance Report. However the total liability unpaid as on 31st March 2017was Rs.1.90 Crores which does not include cheques issued to the investors but notpresented amounting Rs.2.92 Crores.

Future Business Plans

As reported in the earlier years the company stopped NBFC business as per theundertaking given to H'ble High Court of Karnataka while considering the company'sapplication for scheme of arrangement. Since then company was focusing its activities onrecovery of overdues. The company's net owned funds has become positive and meets theminimum required NOF stipulated by Reserve Bank of India for Non-Banking Finance Business.The Company has applied RBI for registering it as a Non-Deposit taking NBFC for pursuingbusiness of Hire Purchase/Lease finance.

Fee based Activities

In order to generate some income to partly meet the establishment expenses yourCompany is engaged as Corporate Agent for Life and General Insurance Companies. Thecompany is also focusing on collecting overdues from HP/Lease/Loans/Bills discountedparties.

DIVIDEND

Since the Company has carried forward losses in the current year the Directors expresstheir inability to recommend Dividend.

SHARE CAPITAL

The paid up Share Capital as on 31st March 2017 was Rs.130267000/-. During the yearunder review the Company has not issued any shares. The Company has not issued shareswith differential voting rights. It has neither issued employee stock options nor sweatequity shares and does not have any scheme to fund its employees to purchase the shares ofthe Company.

DEPOSITS

The Company has not accepted any deposits from the public/ shareholders during the yearunder review as per Section 73 of the Companies Act 2013.

CORPORATE GOVERNANCE

Pursuant to Regulation 34(3) read with Schedule V of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 Corporate Governance Report and Auditor'sCertificate regarding Compliance of conditions of Governance are made part of this Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mr. H. N. S. Rao [DIN 00106953] Director retire by rotation at the forthcoming AnnualGeneral Meeting and being eligible offer himself for reappointment.

Details of remuneration paid to the Directors and Key Managerial Personnel are given inthe Annexure I forming part of the Boards' Report.

A brief profile of the Directors seeking confirmation/appointment nature of expertisein specific functional area name of other public companies in which he/she holdsdirectorship and membership/chairmanship of the committees of the Board of Directors andthe particulars of the shareholding as stipulated under Regulation 36(3) of SEBI (ListingObligations & Disclosure Requirements) Regulations 2015 and Secretarial Standards 2(SS 2 on General Meetings) is appended to the Notice.

The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed both under theCompanies Act 2013 and Regulations of SEBI (Listing Obligations & DisclosureRequirements) Regulations 2015.

Mrs. Varsha Agrawal Company Secretary resigned on 31st October 2016 owing to somepersonal reasons and in her place Mrs. Veena Hegde ACS (Membership No. A45746) fromBangalore has been appointed as Company Secretary and Compliance Officer with

MEETINGS

A calendar of Meetings is prepared and circulated in advance to the Directors. Duringthe year four Board Meetings were convened and held on 18.05.2016 09.08.2016 10.11.201609.02.2017. The intervening gap between the Meetings was within the period prescribedunder the Companies Act 2013.

The role and terms of reference of Audit Committee cover the areas mentioned inRegulation 72 of the SEBI (Listing Obligation & Disclosure Requirements) Regulations2015 and Section 179 of the Companies Act 2013 besides other terms referred to by theBoard of Directors from time to time. During the year the Committee met on 18.05.201609.08.2016 10.11.2016 09.02.2017.

AUDIT COMMITTEE

The Audit Committee comprises independent directors namely Mr. Bharath K. Nayak(Chairman) Mr. K. M. Udupa Mr. A. Giridhar Pai and Mr. U. Harish P. Shenoy as othermembers. All the recommendations made by the Audit Committee were accepted by the Board.Details of Audit Committee meetings are enumerated in the Corporate Governance Report.

REPORT ON CORPORATE SOCIAL RESPONSIBILITY (CSR)

INITIATIVES OF THE COMPANY

Since the company is still carrying over the losses Corporate Social Responsibilitycommittee pursuant to provisions of Section 135(1) of the Companies Act 2013 has not beenformed for the time being.

PARTICULARS OF EMPLOYEES

During the year under review the Company had no employees whose remuneration exceededthe limit prescribed under Section 197 of the Companies Act 2013 read with Rule 5(1) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 andsubsequent amendments thereto.

The top 10 employees of the Company in terms of remuneration drawn during the year2016-17 are enclosed as Annexure IV to this report.

RISK MANAGEMENT

Your Company recognizes that risk is an integral part of business and is committed tomanaging the risks in a proactive and efficient manner.

Your Company through its risk management process strives to contain impact andlikelihood of the risks from time to time.

SUBSIDIARY / ASSOCIATE COMPANIES

The Consolidated Financial Statements of the Company and its subsidiaries andassociatesfrom1stNovember 2016. prepared in accordance with Accounting Standard 21issued by the Institute of Chartered Accountants of India form part of the Annual Reportand are reflected in the Consolidated Financial Statements of the Company.

The Annual Accounts of the subsidiaries/associates and related detailed informationwill be kept at the Registered Office of the Company as also at the registered offices ofthe respective subsidiary/associate companies and will be available to investors seekinginformation at any time.

Salient features of financial statements of subsidiary/associate companies pursuant toSection 129(3) of the Companies Act 2013 have been covered in the Financial Statements inForm AOC-1.

RELATED PARTY TRANSACTION

All related party transactions that were entered into were on an arm's length basis inthe ordinary course of business and were in compliance with the applicable provisions ofCompanies Act 2013 ("the Act"). There were no materially significanttransactions made by the Company during the year that would have required shareholdersapproval under the provisions of the Act. Details of the transactions with related partiesare provided in the Note No.2.30 of accompanying financial statements.

Form AOC-2 pursuant to clause (h) of sub-section (3) of Section 134 of the Act and Rule8(2) of the Companies (Accounts) Rules 2014 is annexed herewith marked as Annexure II.

BOARD EVALUATION

Pursuant to the provisions of Companies Act 2013 and Clause 49 of the ListingAgreement Board has carried out an annual performance evaluation of its own performanceand the Directors individually. The manner in which the evaluation has been carried outare detailed below:

The performance evaluation of Chairman and Non-Independent Directors was carried out bythe Independent Directors. The Independent Directors evaluated the parameters viz. levelof engagement duties responsibilities performance obligations and governancesafeguarding the interest of the Company. The performance evaluation of Independentdirectors was carried out by the entire Board.

AUDITORS

Pursuant to the provisions of Section 139 of the Companies Act 2013 and the rulesframed thereunder the appointment of Chaturvedi & Shah Chartered Accountants Mumbai(Firm Registration No. 101720W) as Statutory Auditors were ratified at the AGM held on26th September 2016 whose appointment shall be effective till the conclusion of AGM tobe held in the calendar year 2017.

Based on the above provisions mandatory rotation of auditors is applicable for theCompany and considering the same the Board of Directors at their meeting held on 30thMay 2017 has subject to approval of the members of the Company at the AGM appointedM/s Pathak H D & Associates Chartered Accountants Mumbai (FRN: 107783W) as StatutoryAuditors of the Company for a period of 5 years (subject to ratification at each AGM) tillthe conclusion of the 51st AGM of the Company to be held in the year 2022 subject toapproval of member at this AGM.

AUDITORS' REPORT

Auditors report does not contain any qualifications or adverse remarks.

SECRETARIAL AUDIT REPORT

In terms of Section 204 of the Act and Rules made there under Sri Shrinivas DevadigaPracticing Company Secretary (Membership No.22381 CoP No.10372) from Bangalore has beenappointed as Secretarial Auditor of the Company. The report of the Secretarial Auditor isenclosed as Annexure IV to this report. Secretarial Auditors' Report does not contain anyqualifications reservations or adverse remarks.

INTERNAL FINANCIAL CONTROL

The Company has implemented and evaluated the Internal Financial Controls which providea reasonable assurance in respect of providing financial and operational informationcomplying with applicable statutes and policies safeguarding of assets prevention anddetection of frauds accuracy and completeness of accounting records. The Company hasappointed Internal Auditor with dedicated internal audit team. The Internal Audit Reportswere reviewed periodically by the Audit Committee. Further the Audit Committee annuallyreviews the effectiveness of the Company's internal control system. The Directors andManagement confirm that the Internal Financial Controls (IFC) and adequate with respect tothe operations of the Company. A report of Auditors pursuant to Section 143(3)(i) of theCompanies Act 2013 certifying the adequacy of Internal Financial Controls is annexed withthe Auditors Report.

EXTRACT OF ANNUAL RETURN

As required pursuant to Section 92(3) of the Companies Act 2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extract of annual return inMGT 9 is attached as a part of this Annual Report as

ANNEXURE I.

Material changes and commitments if any affecting the financial position of thecompany which has occurred between the end of the financial year of the company to whichthe financial statements relate and the date of the report:

There are no such material changes to be reported in this regard.

Change in nature of Business:

There is no change in nature of business.

Details of significant regulators or courts or tribunals impacting the going concernstatus and company's operations in future:

Your Directors wish to state that there have been no significant or material ordersthat were passed by the Regulators or Courts or Tribunals which may impact the goingconcern status and operations of the Company in future. reservations

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186

Details of Loans: Nil

Details of Guarantee/Security Provided: Company has not provided any guarantee/Securityduring the financial Investments made are of the nature quoted/unquoted equity shares andinvestment in property. Particulars of such investments are provided in the financialstatements vide Note Nos. 2.08.

OBLIGATION OF COMPANY UNDER THE SEXUAL HARASS- MENT OF WOMEN AT WORK PLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013

In order to prevent sexual harassment of Women at work place a new Act The SexualHarassment of Women at Work Place (Prevention Prohibition & Redressal) Act 2013 hasbeen notified on 9th December 2013. In terms of the said Act your Company hasconstituted an Internal Complaints Committee to look into complaints of sexual harassmentat work place of any women employee. The company has adopted a policy for prevention ofsexual harassment of women at work place and has set up internal committee forimplementation of the said policy. During the year your Company has not received anycomplaint of sexual harassment of any women employee.

The following is a summary of sexual harassment complaints received and disposed offduring the year 2016-17: a. No. of complaints received : Nil b. No. of complaints disposedoff : Nil

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

 

The company did not have any activity in relation to conservation of energy ortechnology absorption. The company had no foreign exchange earnings or outgoings duringthe year under report.

DIRECTORS' RESPONSIBILITY STATEMENT

Your Directors hereby report in terms of clause (c) of sub-section (3) of Section 134of the Companies Act 2013 that —

 

(a) in the preparation of the annual accounts the accounting standards have beenfollowed along with proper explanation relating to material departures;

(b) the directors have selected such accounting and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the company at the end of the financial year and of the profitand loss of the company for that period;

(c) the directors have taken proper and sufficient the maintenance of adequateaccounting records in accordance with the provisions of this 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; and (e)the directors have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.

TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to the provisions of the Investor Education and Protection Fund (Uploading ofinformation regarding unpaid and unclaimed amounts lying with companies) Rules 2012 the

Company has already filed the necessary form and uploaded the details of unpaid andunclaimed amounts lying with the Company as on the date of last AGM (i.e. 28.9.2015)with the Ministry of Corporate Affairs.

VIGIL MECHANISM

The Company has a Whistle Blower Policy for Directors and employees and adopted theWhistle Blower Policy in terms of Section 177 (9) and (10) of the Companies Act 2013 andSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 to report genuineconcerns if any about unethical behavior wrongful conduct and violation of Company'scode of conduct or ethics. The Whistle Blower Policy is available on the Company'swebsite: www.icdslimited.com .

ACKNOWLEDGEMENT

Your Directors wish to place on record their appreciation of the services andco-operation extended by our Bankers Investors and Members of Staff of the Companyduring the year under report. Your directors also wish to thank the shareholders for theirsupport. policiesYour directors also wish to place on record their deep sense ofappreciation of the services rendered by the staff members at all levels.

For and on behalf of the Board of Directors

care for
Sd/-
Place : Manipal (T. Mohandas Pai)
Date : 30.05.2017 Chairman & Whole-time Director
(DIN-00104336)