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K&R Rail Engineering Ltd.

BSE: 514360 Sector: Infrastructure
NSE: N.A. ISIN Code: INE078T01026
BSE 05:30 | 01 Jan K&R Rail Engineering Ltd
NSE 05:30 | 01 Jan K&R Rail Engineering Ltd

K&R Rail Engineering Ltd. (KRRAIL) - Director Report

Company director report

Dear Members

Your Directors are pleased to present the Thirty Fourth Annual Report and the Company'saudited financial statement for the financial year ended March 31 2017.

FINANCIAL RESULTS

The Company's financial performance for the year ended March 31 2017 is summarizedbelow: (In Rupees)

PARTICULARS YEAR ENDED 31.03.2017 YEAR ENDED 31.03.2016
Sales for the year 1082573336 1017933243
Other Income 16006875 10587822
Total Income 1098580211 1028521065
Profit before Financial Expenses Preliminary expenses Depreciation and Taxation 33592567 43277532
Less: Financial expenses 4542560 6106945
Operating profit before Preliminary expenses Depreciation & Taxation 29050007 37170587
Less: Depreciation & Preliminary expenses written off 15689860 15068103
Profit before Taxation 16321138 22102484
Less : Provision for Taxation
Current Tax 7658807 10253880
Earlier year Tax (517858) (149862)
Deferred Tax (3036841) (6565294)
Profit after Taxation 12217030 18563760

STATE OF COMPANY’S AFFAIRS/ BRIEF DESCRIPTION OF THE COMPANY’S WORKING DURINGTHE YEAR/HIGHLIGHTS/OPERATIONS

Kindly refer to Management Discussion & Analysis and Corporate Governance Reportwhich forms part of this report.

DIVIDEND:-

The Directors have decided to invest the earnings in the growth of business and forthis reason have decided to not to declare any Dividend for the year under review.

RESERVES:-

Your Directors propose to transfer the amount of Net Profit After Tax to GeneralReserve for the financial year ended March 31 2017 as no dividend is declared during theyear keeping in view the requirement to plough back the funds for internal growth of thecompany.

SHARE CAPITAL:-

The Capital Structure of the Company at the beginning of the Financial Year 2016-17 isas follows:

Particulars Amt.
Authorised Share Capital Rs. 310000000/-
Subscribed and Paid- up Share Capital Rs. 25793500

During the year under review the Board of Directors of the Company on June 30 2016has converted 3300000Fully Convertible Warrants ("Warrants") into equivalentnumber of Equity Shares of Rs. 10/ - each and 9900000 7% Optionally ConvertibleRedeemable Preference Shares pursuant to Scheme of Amalgamation duly approved byHon’ble High Court of Hyderabad.

Therefore the Share Capital Structure as on 31stMarch 2017 is as follows:

Particulars Amt.
Authorised Share Capital Rs. 310000000/-
Subscribed and Paid- up Share Capital Rs. 157793550/-

The said shares are currently listed and traded on BSE Limited.

DIRECTORS:-

In accordance with the provisions of the Act and the Articles of Association of theCompany Mr. Ranjan Kapoor Whole-time Director of the Company retires by rotation at theensuing Annual General Meeting and being eligible has offered himself for reappointment

In accordance with the provisions of Companies Act 2013 The Board of Directors of theCompany had appointed Mr. Tamada Srinivas Reddy as an Independent Additional Directorspursuant to provisions of Section 161 of the Companies Act 2013 who shall hold theoffice of Director up to the date of the ensuing Annual General Meeting.

The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed both under the Actand the Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (the "Listing Regulations").

The Company has in place a Policy for performance evaluation of Independent DirectorsBoard Committees and other individual Directors which includes criteria for performanceevaluation of the non-executive directors and executive directors.

On the basis of the Policy for performance evaluation of Independent Directors BoardCommittees and other individual Directors feedback was obtained from all the Directors byway of a structured questionnaire for the evaluation of the Board its Committees and theindividual directors covering inter-alia various aspects of their performance includingcomposition and skills board dynamics understanding of Company’s operationscontribution at meetings and inter-personal skills. The responses received were evaluatedby the Board. KEYMANAGERIALPERSONNEL

The Key Managerial Personnel (KMP) in the Company as per Section 2(51) and 203 of theCompanies Act 2013 are as follows:

Sh. Ranjankapoor Whole Time director
Miss. ChanchalChoudhary Company Secretary
Mr. PAGA VENU GOPAL REDDY CFO

MATERIALCHANGES AND COMMITMENTS

There are no material changes or commitments effecting the Financial position of theCompany happening between the end of the Financial Year of the Company and date of thisReport.

CONSERVATION OF ENERGY TECHNOLOGYABSORPTION FOREIGN EXCHANGE EARNINGS & OUTGO

The requisite information has been given by way of an Annexure I to this Report CHANGESHAPPENING DURING THE FINANCIALYEAR

Your Directors wish to inform that there have not been any changes during the FinancialYear under review:

a. In the nature of Company’s business

b. Generally in the class of business in which the Company has an interest Further theCompany has no Subsidiary and therefore information regarding any change in subsidiariesor in the nature of business carried on by them is not applicable to the Company.

BUSINESS RESPONSIBILITY REPORT

Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 is not applicable to the Company.

POLICYON DIRECTORS APPOINTMENT AND POLICYON REMUNERATION

Pursuant to the requirement under Section 134(3)(e) and Section 178(3) of the CompaniesAct 2013 the policy on appointment of Board members including criteria for determiningqualifications positive attributes independence of a Director and the policy onremuneration of Directors KMP and other employees is attached as Annexure II which formspart of this report.

PARTICULARS OF REMUNERATION OF DIRECTORS/ KMP/EMPLOYEES

In terms of the provisions of Section 197(12) of the Companies Act 2013 read withRules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 there are no employees falling in the bracket as defined in Rule 5(2) 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 is attached as Annexure III which forms part of thisreport.

NUMBER OF MEETINGS OF BOARD

During the year 2016-17 14 (Fourteen) Board Meetings were held and 1 (One) IndependentDirectors meeting was held on 10.03.2017 as required under Schedule IV of Companies Actand as per Regulation 17 of the Listing Regulations 2015. The dates on which the BoardMeetings were held are 30-04-2016 30-052016 30-06-2016 15-07-2016 12-08-201620-08-2016 01-09-2016 15-09-2016 1-10-2016 14-11-2016 04-01-2017 10-02-201727-02-201708-03-2017.

STATUTORYAUDITORS & AUDITORS REPORT

M/s B Aggarwal & Company Chartered Accountants New Delhi was appointed asStatutory Auditors of the Company in the last Annual General Meeting. Their appointment ishereby ratified and they hold the office from the conclusion of this Annual GeneralMeeting till the conclusion of the Annual General Meeting of the Company for the Financialyear 2018-2019.

The Company has obtained a Certificate from the Auditors under Rule 4 (1) of TheCompanies (Audit and Auditors) Rules 2014. They have also issued a Certificate to theeffect that they satisfy the criteria provided in Section 141 of the Companies Act2013.The Auditors have vide their letter dated August 31st 2016 also confirmed that theyhave subjected themselves to the peer review process of Institute of Chartered Accountantsof India(ICAI) and holds a valid certificate issued by the Peer Review Board of theICAI.The Auditors’ Report being self-explanatory require no comments from theDirectors. Further there are no reservations qualifications or adverse remarks in theAudit Report given by them in respect of the Financial Year 2016-17.

SECRETARIALAUDITORS AND THEIR REPORT

CS Vikas Bansal (ACS 42210) a Company Secretary in practice having CP no. 15693 wasappointed as Secretarial Auditor of the Company for the financial year 2016-17 pursuant toSection 204 of the Companies Act 2013. The Secretarial Audit Report submitted by him inthe prescribed form MR- 3 is attached as Annexure IV and forms part of this report.

There are no qualifications or observations or other remarks of the SecretarialAuditors in the Report issued by them for the financial year 2016-17 which call for anyexplanation from the Board of Directors.

FRAUDS REPORTED BY AUDITORS

There are no frauds reported by auditors under sub-section (12) of section 143 otherthan those which are reportable to the Central Government.

COST AUDIT

As per the Cost Audit Orders Cost Audit is not applicable to the Company.

CONSOLIDATED FINANCIAL STATEMENTS

In terms of Rule 6 of Companies (Accounts) Rules 2014 nothing contained in the saidrule shall subject to any other law or regulation apply for the financial yearcommencing from the 1st day of April 2016 and ending on the 31stMarch 2017in case of a company which does not have a subsidiary or subsidiaries but has one or moreassociate companies or joint ventures or both for the consolidation of financialstatement in respect of associate companies or joint ventures or both as the case may be.As the Company does not have any Subsidiary the accounts have not been consolidated forthe FY 2016-17.

INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY.

According to Section 134(5)(e) of the Companies Act 2013 the term Internal FinancialControl (IFC) means the policies and procedures adopted by the company for ensuring theorderly and efficient conduct of its business including adherence to company’spolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information.

The Company has a well placed proper and adequate internal financial control systemcommensurate with the size scale and complexity of its operations. The scope andauthority of the internal Audit function is well defined in the Organization. The internalfinancial control system ensures that all assets are safeguarded and protected and thatthe transactions are authorized recorded and reported correctly. The Company’sinternal financial control system also comprises due compliances with Company's policiesand Standard Operating Procedures (SOPs) and audit and compliance by in-house InternalAudit Division supplemented by Concurrent and Statutory Audit. The Internal Auditorsindependently evaluate the adequacy of internal controls and concurrently audit themajority of the transactions in value terms .Independence of the audit and compliance isensured by regular supervision of the Audit Committee over Internal Audit. Significantaudit observations and corrective actions suggested are presented to the Audit Committeeof the Board. DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT

The Company has in place comprehensive risk assessment and minimization procedureswhich are reviewed by the Board periodically. During the year as per the requirements ofListing Agreement with the Stock Exchanges a Risk Management Committee was constituted bythe Board of Directors with responsibility of preparation of Risk Management Policyreviewing and monitoring the same on regular basis to identify and review critical riskson regular basis to update the Risk management on quarterly basis to report key changesin critical risks to the Board on an ongoing basis to report critical risks to AuditCommittee in detail on yearly basis and such other functions as may be prescribed by theBoard. The Committee holds quarterly meetings to review the critical risks identified. Therisks faced by the Company and their minimization procedures are assessed categoricallyunder the broad heads of High Medium and Low risks. Further the Company identifiesrisks and control systems are instituted to ensure that the risks in each businessprocess are mitigated. The Board provides oversight and reviews the Risk Management Policyon a regular basis. In the opinion of the Board there has been no identification ofelements of risk that may threaten the existence of the Company.

SUBSIDIARIES/ASSOCIATES/JOINT VENTURES

The Company has no subsidiaries or Associates as defined in the Companies Act 2013.

DEPOSITS

The Company has neither accepted nor renewed any deposits during the Financial Year2016-17 in terms of Chapter V of the Companies Act 2013. Information in this regardtherefore is nil.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALSIMPACTING THE GOING CONCERNS STATUS AND COMPANY'S OPERATIONS IN FUTURE

The Company has not received any significant or material orders passed by anyRegulatory Authority Court or Tribunal which shall impact the going concern status andCompany's operations in future.

CODE OF CONDUCT

The Company continues to place emphasis on inclusive growth and has adopted a voluntarycode of conduct for affirmative action.

AUDIT COMMITTEE

Your Directors wish to inform that in Compliance with Section 177 of the CompaniesAct2013 and Regulation 18 Of SEBI Listing Regulation 2015 an audit committee has beenduly constituted. The Audit Committee as on March 31 2017 comprises of the followingIndependent Directors

Mrs. Maniza Khan Independent Director Chairman
Mr. Tamada Srinivas Reddy Independent Director Member
Mr. Shamim Ahmed Qureshi Non executive Director Member

Details of the Audit Committee have been separately given in the corporate governancereport. Further all recommendations of Audit Committee were accepted by the Board ofDirectors.

NOMINATION & REMUNERATION COMMITTEE STAKEHOLDERS RELATIONSHIP COMMITTEE

In terms of Regulation 19 of SEBI Listing Regulation 2015 and pursuant to theprovisions of Companies Act 2013 the details pertaining to Nomination & RemunerationCommittee. The Nomination & Remuneration Committee as on March 31 2017 comprises ofthe following Directors:

Mrs. Maniza Khan Independent Director Chairman
Mr. Tamada Srinivas Reddy Independent Director Member
Mr. Shamim Ahmed Qureshi Non executive Director Member

The details of Remuneration Policy and the Committee are furnished in the Report onCorporate Governance which is annexed herewith.

CORPORATE SOCIALRESPONSIBILITY (CSR)COMMITTEE

In terms of Section 135 of the Companies Act 2013 the Company doesn’t fall underthe requirements of CSR. So there was no CSR Committee.

CHANGE IN CAPITAL STRUCTURE AND LISTING OF SHARES

During the year under review the Board of Directors of the Company on June 30 2016has converted 3300000Fully Convertible Warrants ("Warrants") into equivalentnumber of Equity Shares of Rs. 10/ - each and 9900000 7% Optionally ConvertibleRedeemable Preference Shares pursuant to Scheme of Amalgamation duly approved byHon’ble High Court of Hyderabad.

Furthermore The Company has received listing approval for 3300000 Equity Shares ofRs. 10/- each on December 09 2016 and trading approval for the aforesaid shares on March14 2017.The Company has received listing approval for 9900000 Equity Shares of Rs. 10/-each on February 08 2017and trading approval for the aforesaid shares on March 21 2017.

EXTRACT OF ANNUALRETURN

The extract of Annual Return as on March 31st 2017 in the prescribed FormNo. MGT-9 pursuant to Section 92(3) of the Companies Act 2013 and Rule 12 (1) of theCompanies (Management and Administration) Rules 2014 is attached herewith as Annexure Vand forms part of this Report.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186 OFTHE COMPANIES ACT2013

Pursuant to Section 134(3)(g) of the Companies Act 2013 particulars of loansguarantees or investments under Section 186 of the Act as at end of the Financial Year2016-17 forms part of this report.

CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES UNDER SECTION 188(1) OF THE COMPANIESACT 2013

With reference to Section 134(3)(h) of the Companies Act 2013 all contracts andarrangements with related parties under Section 188(1) of the Act entered by the Companyduring the financial year were in the ordinary course of business and on an arm’slength basis. Hence provisions of Section 18 (1) are not applicable. However as thesetransactions were in the ordinary course of business and on an arm’s length basis inthe opinion of the Board these transactions are justified to be executed.

During the year the Company had not entered into any contract or arrangement withrelated parties which could be considered ‘material’ according to the policy ofthe Company on Materiality of Related Party Transactions. Your attention is drawn to theRelated Party disclosures set out in Note no. 32 of the Financial Statements

VIGILMECHANISM

The Company has established a Vigil Mechanism in terms of Section 177 (10) of theCompanies Act 2013 and also in terms of Regulation 22 of SEBI Listing Regulations 2015The detail of the Vigil Mechanism is given in the Corporate Governance Section which isannexed herewith at ANNEXURE-VI the Vigil Mechanism cum Whistle Blower Policy is alsoavailable on the Company’s website www.axisrail.in.DIRECTOR’S RESPONSIBILITYSTATEMENT

a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;

b) the directors had selected such accounting policies and applied them 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 had 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 had prepared the annual accounts on a going concern basis;

e) the directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively;

f) the directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

INDUSTRIAL RELATIONSHIPS

Relations between the Management and the employees at all levels have been cordial andthe Directors wish to express their appreciation for the cooperation and dedication of theemployees of the Company. COMPLIANCE

The company has devised proper systems to ensure compliance of all laws applicable tothe company and the compliance reports issued by the Departmental Heads are placed beforethe Board every Quarter confirming compliance by the Company with all applicable Laws.

LISTING AND LISTING AGREEMENT

The equity shares of the company are listed at BSE with the sole intent of providingliquidity to the existing Shareholders

The company has already paid listing fees for the year 2017-2018 to BSE Limited.

DEMATERIALIZATION OF SHARES

As mentioned in Company’s earlier Annual Reports the Company’s equity sharesare in compulsory Demat mode in terms of SEBI Guidelines. This has been facilitatedthrough arrangement with NSDL and CDSL. M/s Beetal Computer & Financial ServicesPrivate Limited is acting as the Registrar and Share Transfer Agents for this purpose andacts as common share agency in terms of SEBI Guidelines.

TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND Your Company did not haveany funds lying unpaid or unclaimed for a period of seven years. Therefore there were nofunds which were required to be transferred to Investor Education and Protection Fund(IEPF). FINANCIAL STATEMENTS

Full version of the Annual Report 2016-17 containing complete Balance Sheet Statementof Profit & Loss other statements and notes thereto prepared as per the requirementsof Schedule III to the Companies Act

2013 Directors’ Report (including Management Discussion and Analysis CorporateGovernance Report and Business Responsibility Report) are being sent via email to allshareholders who have provided their email address (es). To others the Full version ofthe Annual Report is being sent by post. Full version of Annual Report 2016-17 is alsoavailable for inspection at the registered office of the Company during working hours upto the date of ensuing Annual General Meeting (AGM). It is also available at the Company'swebsitewww.axisrailindia.com. Please note thatyou will be entitled to be furnished free of cost the full Annual Report 2016-17 uponreceipt of written request from you as a member of the Company. DISCLOSURE UNDER THESEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION. PROHIBITION AND REDRESSAL) ACT 2013

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 and Redressal)Act 2013. Internal Complaints Committee (ICC) has been set up to redress complaintsreceived regarding sexual harassment. All employees (permanent contractual temporarytrainees) 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 :Nil

No. of Complaints disposed off :Nil:

ACKNOWLEDGEMENT

The Directors sincerely acknowledge the trust and confidence that has been placed bythe employees shareholders and investors in the Company. The Directors are thabkful toall the employees and the officers of the Company for their dedication support andco-operation.

For & On Behalf of the Board PLACE: SECUNDERABAD
SD/- Date: September 01 2017
(RANJAN KAPOOR)
WHOLE TIME DIRECTOR
(DIN 00479483)

ANNEXURE I TO THE DIRECTORS’REPORT:-

A. Conservation of Energy:

Though energy does not form a significant portion of the cost for the Company yetwherever possible and feasible continuous efforts are being put for conservation ofenergy and minimize power cost. The Energy conservation measures include replacement ofincandescent lights with low power consuming LRD lights compact Fluorescent and ITLights replacement of old electrical units with new energy efficient units. Staff of theCompany is regularly sensitized about conservation of power

B. Technology Absorption:

The Company continues to absorb and upgrade modern technologies in its operations andback end support functions like Accounts Human Resource Management and Compliancefunctions.

C. Foreign exchange earnings and outgo:

There are no foreign currency dealing in the Company.

For & On Behalf of the Board PLACE: SECUNDERABAD
SD/- Date: September 01 2017
(RANJAN KAPOOR)
WHOLE TIME DIRECTOR
(DIN 00479483)

ANNEXURE D- II TO THE DIRECTOR’S REPORT NOMINATION AND REMUNERATION POLICY

This Nomination and Remuneration Policy is being formulated in compliance with Section178 of the Companies Act 2013 read along with the applicable rules thereto. This policyon nomination and remuneration of Directors Key Managerial Personnel and SeniorManagement has been formulated by the Nomination and Remuneration Committee (NRC or theCommittee) and has been approved by the Board of Directors.

ROLE OF COMMITTEE

3.1 Matters to be dealt with perused and recommended to the Board by the Nominationand Remuneration Committee

The Committee shall:

3.1.1 Formulate the criteria for determining qualifications positive attributes andindependence of a director.

3.1.2 Identify persons who are qualified to become Director and persons who may beappointed in Key Managerial and Senior Management positions in accordance with thecriteria laid down in this policy.

3.1.3 Recommend to the Board appointment and removal of Director KMPand SeniorManagement Personnel.

3.2 Policy for appointment and removal of Director KMP and Senior Management

3.2.1 Appointment criteria and qualifications

a) The Committee shall identify and ascertain the integrity qualification expertiseand experience of the person for appointment as Director KMP or at Senior Managementlevel in line with the Business of the Company and recommend to the Board his / herappointment.

b) A person should possess adequate qualification expertise and experience for theposition he / she is considered for appointment. The Committee has discretion to decidewhether qualification expertise and experience possessed by a person is sufficient /satisfactory for the concerned position.

c) The Company shall not appoint or continue the employment of any person as Whole-timeDirector who has attained the age of seventy years. Provided that the term of the personholding this position may be extended beyond the age of seventy years with the approval ofshareholders by passing a special resolution based on the explanatory statement annexed tothe notice for such motion indicating the justification for extension of appointmentbeyond seventy years.

3.2.2 Term / Tenure

a) Managing Director/Whole-time Director:

The Company shall appoint or re-appoint any person as its Executive Chairman ManagingDirector or

Executive Director for a term not exceeding five years at a time. No re-appointmentshall be made earlier

than one year before the expiry of term.

b) Independent Director:

— An Independent Director shall hold office for a term up to five consecutiveyears on the Board of the Company and will be eligible for re-appointment on passing of aspecial resolution by the Company and disclosure of such appointment in the Board'sreport.

— No Independent Director shall hold office for more than two consecutive termsbut such Independent Director shall be eligible for appointment after expiry of threeyears of ceasing to become an Independent Director. Provided that an Independent Directorshall not during the said period of three years be appointed in or be associated withthe Company in any other capacity either directly or indirectly. However if a person whohas already served as an Independent Director for 5 years or more in the Company as onOctober 1 2016 or such other date as may be determined by the Committee as per regulatoryrequirement; he/ she shall be eligible for appointment for one more term of 5 years only.

— At the time of appointment of Independent Director it should be ensured thatnumber of Boards on which such Independent Director serves is restricted to seven listedcompanies as an Independent Director and three listed companies as an Independent Directorin case such person is serving as a Whole-time Director of a listed company or such othernumber as may be prescribed under the Act.

3.2.3 Evaluation

The Committee shall carry out evaluation of performance of every Director KMP andSenior Management Personnel at regular interval (yearly) on the basis of followingcriteria:-

a. Criteria for evaluation of the Board of Directors as a whole:

i. The Frequency of Meetings.

ii. Quantum of Agenda

iii. Administration of Meetings

iv. Flow and quantity of Information from the Management to the Board

v. Number of Committees and their role.

vi. Overall performance of the Company

b. Criteria for evaluation of the Individual Directors;

i. Experience and ability to contribute to the decision making process

ii. Problem solving approach and guidance to the Management

iii. Attendance and Participation in the Meetings

iv. Personal competencies and contribution to strategy formulation

v. Contribution towards statutory compliances monitoring of controls and CorporateGovernance

3.2.4 Removal

Due to reasons for any disqualification mentioned in the Act or under any otherapplicable Act rules and regulations there under the Committee may recommend to theBoard with reasons recorded in writing removal of a Director KMP or Senior ManagementPersonnel subject to the provisions and compliance of the said Act rules and regulations.

3.2.5 Retirement

The Director KMP and Senior Management Personnel shall retire as per the applicableprovisions of the Act and the prevailing policy of the Company. The Board will have thediscretion to retain the Director KMP Senior Management Personnel in the same position/remuneration or otherwise even after attaining the retirement age for the benefit of theCompany.

6. MEMBERSHIP OF COMMITTEE

4.1 The Committee shall consist of a minimum 3 non-executive directors majority ofthem being independent.

4.2 Minimum two (2) members shall constitute a quorum for the Committee meetings.

4.3 Membership of the Committee shall be disclosed in the Annual Report

4.4 Term of the Committee shall be continued unless terminated by the Board ofDirectors.

7. CHAIRPERSON

5.1 Chairperson of the Committee shall be an Independent Director

5.2 Chairperson of the Company may be appointed as a member of the Committee but shallnot be a Chairman of the Committee

5.3 In the absence of the Chairperson the members of the Committee present at themeeting shall choose one amongst them to act as Chairperson.

5.4 Chairman of the Nomination and Remuneration Committee meeting could be present atthe Annual General Meeting or may nominate some other member to answer the shareholders'queries

8. FREQUENCYOF MEETINGS

The meeting of the Committee shall be held at such regular intervals as may berequired.

9. COMMITTEE MEMBERS' INTERESTS

7.1 The disclosure of Interest and participation in the meetings by a member of theCommittee shall be as per the provisions of the Act and Rules made thereunder from time totime.

7.2 The Committee may invite such executives as it considers appropriate to bepresent at the meetings of the Committee

10. VOTING

8.1 Matters arising for determination at Committee meetings shall be decided by amajority of votes of Members present and voting and any such decision shall for allpurposes be deemed a decision of the Committee.

8.2 In the case of equality of votes the Chairman of the meeting will have a castingvote

11. MINUTES OF COMMITTEE MEETING

Proceedings of all meetings must be minuted and signed by the Chairman of the Committeeat the subsequent meeting. Minutes of the Committee meetings will be tabled at thesubsequent Board and Committee meeting.

For & On Behalf of the Board PLACE: SECUNDERABAD
SD/- Date: September 01 2017
(RANJAN KAPOOR)
WHOLE TIME DIRECTOR
(DIN 00479483)

ANNEXURE III

POLICY RELATING TO THE REMUNERATION FOR THE WHOLE-TIME DIRECTOR KMP AND SENIORMANAGEMENT PERSONNEL

General:

a. ) The remuneration / compensation / commission etc. to the Whole-time Director KMPand Senior

Management Personnel will be determined by the Committee and recommended to the Boardfor approval. The remuneration / compensation / commission etc. shall be subject to theprior/post approval of the shareholders of the Company and Central Government whereverrequired.

b. ) The remuneration and commission to be paid to the Whole-time Director shall be inaccordance with

the percentage / slabs / conditions laid down in the Articles of Association of theCompany and as per the provisions of the Act.

c. ) Increments to the existing remuneration/ compensation structure may be recommendedby the

Committee to the Board which should be within the slabs approved by the Shareholders inthe case of Whole-time Director.

d. ) Where any insurance is taken by the Company on behalf of its Whole-time DirectorChief Executive

Officer Chief Financial Officer the Company Secretary and any other employees forindemnifying them against any liability the premium paid on such insurance shall not betreated as part of the remuneration payable to any such personnel. Provided that if suchperson is proved to be guilty the premium paid on such insurance shall be treated as partof the remuneration.

Remuneration to Whole-time / Executive / Managing Director KMP and Senior ManagementPersonnel:

1) Remuneration to Managing Director / Whole-time Directors:

a. The Remuneration/ Commission etc. to be paid to Managing Director / Whole-timeDirectors etc. shall be governed as per provisions of the Companies Act 2013 and rulesmade there under or any other enactment for the time being in force and the approvalsobtained from the Members of the Company. The Nomination and Remuneration Committee shallmake such recommendations to the Board of Directors as it may consider appropriate withregard to remuneration to Managing Director / Whole-time Directors.

b. Minimum Remuneration:

If in any financial year the Company has no profits or its profits are inadequatethe Company shall pay remuneration to its Whole-time Director in accordance with theprovisions of Schedule V of the Act and if it is not able to comply with such provisionswith the previous approval of the Central Government.

c. Provisions for excess remuneration:

If any Whole-time Director draws or receives directly or indirectly by way ofremuneration any such sums in excess of the limits prescribed under the Act or without theprior sanction of the Central Government where required he / she shall refund such sumsto the Company and until such sum is refunded hold it in trust for the Company. TheCompany shall not waive recovery of such sum refundable to it unless permitted by theCentral Government.

2) Remuneration to Non- Executive / Independent Directors

a. The Non-Executive / Independent Directors may receive sitting fees and such otherremuneration as permissible under the provisions of Companies Act 2013. The amount ofsitting fees shall be such as may be recommended by the Nomination and RemunerationCommittee and approved by the Board of Directors.

b. All the remuneration of the Non- Executive / Independent Directors (excludingremuneration for attending meetings as prescribed under Section 197 (5) of the CompaniesAct 2013) shall be subject to ceiling/ limits as provided under Companies Act 2013 andrules made there under or any other enactment for the time being in force. The amount ofsuch remuneration shall be such as may be recommended by the Nomination and RemunerationCommittee and approved by the Board of Directors or shareholders as the case may be.

c. An Independent Director shall not be eligible to get Stock Options and also shallnot be eligible to participatein any share based payment schemes of the Company.

d. Any remuneration paid to Non- Executive / Independent Directors for servicesrendered which are of professional in nature shall not be considered as part of theremuneration for the purposes of clause

(b) above if the following conditions are satisfied:

i. The Services are rendered by such Director in his capacity as the professional; and

ii. In the opinion of the Committee the director possesses the requisite qualificationfor the practice of that profession

e. The Compensation Committee of the Company constituted for the purpose ofadministering the

Employee Stock Option/ Purchase Schemes shall determine the stock options and othershare based payments to be made to Directors (other than Independent Directors).

3) Remuneration to Key Managerial Personnel and Senior Management:

a) The remuneration to Key Managerial Personnel and Senior Management shall be incompliance with the applicable provisions of the Companies Act 2013 and in accordancewith the Company's Policy

b) The Compensation Committee of the Company constituted for the purpose ofadministering the Employee Stock Option/ Purchase Schemes shall determine the stockoptions and other share based payments to be made to Key Managerial Personnel and SeniorManagement.

c) The Fixed pay shall include monthly remuneration employer's contribution toProvident Fund contribution to pension fund pension schemes etc. as decided from totime.

d) The Incentive pay shall be decided based on the balance between performance of theCompany and performance of the Key Managerial Personnel and Senior Management to bedecided annually or at such intervals as may be considered appropriate.