The Directors have pleasure in presenting before you the 29th Annual Report of theCompany together with the Audited Statement ofAccounts and the Auditors Report for theyear ended 31st March 2020.
The financial performance ofthe company is highlighted as follows:
|Particulars ||2019-20 ||2018-19 |
|Gross Income ||359.64 ||66.65 |
|Expenses || || |
|Employees benefit ||29.63 ||24.62 |
|Finance Cost ||0.00 ||0.00 |
|Depreciation ||0.31 ||0.82 |
|Other expenses ||55.23 ||27.97 |
|Total expenses ||85.17 ||53.41 |
|Reversal provision ||(363.12) ||(46.11) |
|Net Profit Before Tax ||274.47 ||13.24 |
|Provision for Tax ||0.00 ||0.00 |
|Net Profit / Loss After Tax ||274.47 ||13.24 |
|Loss brought forward ||(13757.70) ||(13770.94) |
|Balance Loss Carried to Balance Sheet ||(13483.23) ||(13757.70) |
PERFORMANCE OFTHE COMPANY
The Company is making continuous efforts for recovery of the non-performing assets aswas done in the previous financial years. During the currentperiodthe company hasrecovered Rs.10.06 lakhs from individual housing loans and ICD loan as against Rs.4.48lakhs during the previous year.
The net profit for the financial year 2019-20 is Rs.274.47 lakhs as compared to anetprofit ofRs.13.24 lakhs in the previous financial year.
Government has introduced various schemes for encouraging the housing sector with avision to provide house for all by year 2022. Infrastructure status was given to companiesproviding affordable housing. Interest subsidy for EWS/LIG MIG -1 and MIG -II segmentsare also made available under Prime Ministers Awas Yojana (PMAY) scheme for financinghousing sector.
To take advantage ofthe situation the company proposed to carry out capitalrestructuring by way ofRestructuring the entire term loan outstand ing amount Rs.129.00crores as Funded Interest Term Loan (FITL) with Nil interest from 01.04.2017 and tosubsequently convert the FITL into non-cumulative compulsorily convertible preferenceshares (CCPS) for a period of 20 years at a coupon rate of 0.001% subject to gettingnecessary approvals. Since the re were delay in getting necessary approvals in the Boardmeeting held on 19.07.2019 Board approved the appointment of M/s.SBI Capital MarketServices Limited as advisors for suggesting options available to the company forenhancement of Housing Finance business through organic / or inorganic means. We continueour efforts for revival ofbusiness.
In view of the accumulated losses and also to augment resources for the ongoingrestructuring exercise the Board of Directors have not recommended any dividend for thefinancial year ended 31st March 2020.
The following are the Key Managerial Personnel of the company:
|Name ||Designation |
|Shri Sesha Sai PLVK (DIN - 08192892) ||Managing Director |
|Shri Soubhagya Mohakhud(ACS 31246) ||Company Secretary |
|Shri B Samarapuri ||Chief Financial Officer |
DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS
The Company has received necessary declaration from each Independent Director of theCompany under Section 149(7) of the Companies Act 2013 and the Independent Directors ofthe Company meet the criteria of Independence as laid down in Section 149(6).
COMPOSITION OF BOARD OF DIRECTORS.
On the recommendation of Nomination and Remuneration Committee Shri K.Ramachand ran isappointed as an Additional Director in the Company at 157thBoardMeeting with effect from11.06.2020.
Shri Shenoy Vishwanath Vittal Director has tendered his resignation as director fromthe Board of the Company consequent to nomination of Shri K Ramachand ran ExecutiveDirector of the Indian Bank. the Board has accepted hisresignation letter at 157thBoardMeetingwitheffectfrom 16.04.2020.
Ason31.03.2020 boardconsists ofthe following Directors:
|Name of the Director ||Category |
|1. Shri Shenoy Vishwanath Vittal ||Non-Executive Director |
|2. Shri M S Natarajan ||Independent Director |
|3. Shri P A Krishnan ||Non-Executive Director |
|4.Shri T R Chand rasekaran ||Independent Director |
|5.Smt.Rajeswari S. ||Independent Director |
|6.Shri Rakesh Sethi ||Independent Director |
|7.Shri S Thangaraju ||Nominee Director |
|8.Shri Sesha Sai PLVK ||Managing Director |
None of the Directors on the Board of the Company has been debarred or disqualifiedfrom being appointed or continuing as directors of Company by the securities and ExchangeBoard of India Ministry of Corporate affairs or any such StatutoryAuthority. COMPLIANCEAUDIT BY C &AGFOR the YEARS 2017-19:
The office of C & AG Chennai conducted the trans Action/compliance audit for theyears 2017-19. the Audit was conducted by ShriK.ArunJyothySeniorAuditOfficerandShriBhagwanSinghAssistantAuditOfficerduring23.09.2019to27.09.2019.
The Board considered four audit notes which were issued by the office of C &AG andthe replies given by the Company and took the same on record.
COMPOSITION OFAUDIT COMMITTEE:
TheAudit Committee ofthe Board consists ofthe following Directors as its members:
|Name of the Director ||Category ||Position |
|1. Shri T R Chand rasekaran ||Independent Director ||Chairman of the committee |
|2. Shri PAKrishnan ||Non-Executive Director ||Member |
|3. Shri M S Natarajan ||Independent Director ||Member |
|4. Smt.Rajeswari S. ||Independent Director ||Member |
|5. Shri Rakesh Sethi ||Independent Director ||Member |
The Boardhas accepted all the recommendations of the Audit Committee.
Pursuant to the provisions of the Companies Act 2013 and SEBI (LODR) Regulations 2015the Board has carried out an annual performance evaluation of its own performance thedirectors individually as well as the evaluation of the working of its Audit andNomination & Remuneration Committees. the manner in which the evaluation has beencarried out has been explained in the Corporate Governance Report.
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. the Remuneration Policy is stated in the Corporate Governance Report.
The Company has established a vigil mechanism called Whistle-blower Policy for itsdirectors and employees to report genuine concerns pursuant to the provisions of section177(9)&(10)of the Companies Act 2013 and as per Regulations 22of SEBI (LODR)Regulations 2015. the details of the Whistle-blower Policy is explained in the CorporateGovernance Report and also posted on the website ofthe Company.
DIRECTORS' RESPONSIBILITY STATEMENT
In pursuance of section 134(5) of the Companies Act 2013the Directors hereby confirmthat:
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 the m 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 profit and loss 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 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 laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
f) the directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively
As required pursuant to section 92(3) of the Companies Act 2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extr Act of annual return inform MGT 9 is annexed herewith.
TheAuditors M/s M.R.Narain & Co CharteredAccountants Chennai were appointedbythe office ofthe Comptroller and Auditor General of India New Delhi in exercise of thepowers conferred on the m by section 139 of the Companies Act 2013 as statutory auditorsof the company for the financial year 2019-20.
Secretarial audit report in form MR3 as given by M/s. SPNP&Associates PractisingCompany Secretary is annexed to this Report. QUALIFICATIONS IN AUDIT REPORTS:
There is no qualification in auditors' report. However observations are made by theAuditors in their Report and Notes onAccounts which are self-explanatory.
Information as per section 134(3) (m) of the Companies Act 2013:
a. the company has no Activity relating to conservation of energy or technologyabsorption.
b. the company did not have any foreign exchange earnings as well as expenses.
The Company stopped accepting deposits from public since 1998. the company repaid alldeposits except Rs.6.33 lakhs withheld by Central Bureau ofInvestigationAnti-corruptionBranch Sastri Bhavan Chennai pending disposal oftheir case.
SIGNIFICANT & MATERIAL ORDERS PASSED BYTHE REGULATORS
There isno significant and material order passed by the regulators or Courts orTribunals imp Acting the going concern status and the company's operations in future.
DETAILS OFADEQUACY OF INTERNAL FINANCIAL CONTROLS
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. the internal control system provides reasonable assurance ofrecording the trans Actions of operations in all material aspects and providing protectionagainst misuse or loss of company's assets.
RISK MANAGEMENT POLICY
The company has put in place Risk Management Policy commensurate with the type and sizeof operations and risk perception. the said policy is drawn up based on the guidelinesofNHB issued in this regard.
PROHIBITION OF INSIDER TRADING POLICY (PIT)
It is mand atory in terms of the SEBI (Prohibition of Insider Trading) (Amendment)Regulations 2018 as amended from time to time (Regulations) for every company whosesecurities are listed on a stock exchange to formulate and publish on its website a Codeof Practices and Procedures for fair disclosure of unpublished price sensitiveinformation(Code). the Code among other things also seeks to ensure timely and adequatedisclosure of unpublished price sensitive information to the investor community by theCompany to enable the m to take informed investment decisions with regardto the Company'sSecurities.
CORPORATE SOCIAL RESPONSIBILITY POLICY
The company has earned net profit during the financial year ending with 2019-20.However the company does not fall within the criteria specified in section 135 of theCompanies Act 2013 making it mand atory for the company to contribute towards thecorporate social responsibility.
RELATED PARTY TRANS ACTIONS
The trans Actions with holding Company have not been disclosed in view ofPara 9 ofAS-18and Para25 ofIndAS-24. Related Party Disclosure: No disclosure is required in thefinancial statements of state-controlled enterprises as regards relatedparty relationshipswith other state-controlled enterprises and trans Actions with such enterprises.
During the course ofbusiness the Company obtained loan from the Holding Institution(Indian Bank) at market rate ofinterest. An agreement has been entered into with IndianBank for not to charge interest from 01.04.2017. Accordingly no interest on the loan hasbeen accounted for the year 2019-20.
Apart from this the company has no relatedparty trans Actions referred to in section188(1)of the Companies Act 2013.
FORMAL ANNUAL EVALUATION
Pursuant to the provisions ofthe Companies Act 2013 and Regulations 17 (10) ofSEBI(LODR) Regulations 2015 and also in line with the guidance note issued by SEBI the Boardhas carried out an annual performance evaluation of its own performance the directorsindividually as well as the evaluation of the working of its Audit and Nomination &Remuneration Committees. the performance evaluation of the Independent Directors wascarried out by the entire Board. the performance evaluation of the Chairman and the NonIndependent Directors was carried out by the Independent Directors. the Directorsexpressed their satisf Action with the evaluation process and the performance ofthe Board.
RATIO OF REMUNERATION TO EACH DIRECTOR
Details / Disclosures ofRatio ofRemuneration to each Director to the median employee'sremuneration asANNEXURE -1 LISTING WITH STOCK EXCHANGES
The Company confirms that it has paid the Annual Listing Fees of Rs. 3.00 lakhs plusGST for the year 2020-21 to BSE where the Company's Shares are listed.
CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION
Your Company has taken adequate steps to adhere to all the stipulations laid down inthe provisions of SEBI (LODR) Regulations 2015. Areport on Corporate Governance isincluded as part of thisAnnual Report.
Certificate from the practicing Company Secretary confirming the compliance with theconditions of Corporate Governance as stipulatedunderprovisions ofRegulations 34 (3) SEBI(LODR) Regulations 2015 and otherrequirements as specified in Schedule V of the saidRegulations is attachedto this report.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 (1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules are attached to this report.None ofthe employees of the company received remuneration in excess of the limitsprescribed Under Rule 5 (2) ofThe Companies (Appointment and Remuneration ofManagerialPersonnel) Rules of the Companies Act 2013.
INDUSTRYBASED DISCLOSURESAS MAND ATED BYTHE RESPECTIVE LAWS GOVERNING the COMPANY
As required under National Housing Bank Directions your Company is presently requiredto maintain a minimum capital adequacy of 12% on a stand -alone basis. the company'scapital adequacy ratio is negative due to accumulated loss. the following is the capitaladequacy ratio for the last three years:
|Particulars ||2017-18 ||2018-19 ||2019-20 |
|Capital adequacy ratio ||-4401.11 % ||-4466.02 % ||- 5225.94 % |
The Company has adhered to the prudential guidelines for Non-Performing Assets (NPAs)issued by the National Housing Bank (NHB - Directions of 2010) as amended fromtime totime. the Company did not recognise income on NPAs and further created provisions forcontingencies on Standard as well as non-performing housing loans and property loans inaccordance with the National Housing BankDirections.
The Directors also place on record their appreciation for the assistance Activesupport and guidance received from RBI NHB the sectoral regulator for housing financeIndian Bank and its officers and staff. the Directors express their appreciation for thecontribution of the employees of the company. the Board of Directors thank all theShareholders for their patronage. their continued patronage and support are of greatencouragement to the company and will serve as a source of strength in all its futureendeavours.
| ||For and on behalf of Board of Directors |
|Place : Chennai ||P.A.KRISHNAN ||SESHA SAI PLVK |
|Date : 11.06.2020 ||DIRECTOR ||MANAGING DIRECTOR |