Your directors have pleasure in presenting before you the 34th Board'sReport on the Company's business and operations together with the audited financialstatements (standalone & consolidated) for the financial year ended March 31 2022.
Update on successful implementation of the 'Resolution Plan'
In accordance with the applicable provisions of the Insolvency andBankruptcy Code 2016 ("IBC/Code") the Corporate Insolvency Resolution Process("CIRP Process") of M/s. MIC Electronics Limited ("Company") wasinitiated by the Financial Creditors of the Company. The Financial Creditors petition toinitiate the CIRP Process was admitted by the National Company Law Tribunal("NCLT") Hyderabad Bench on March 13 2018 ("Insolvency CommencementDate"). Mr. Prabhakar Nandiraju was appointed as the Interim Resolution Professional("IRP") to manage the affairs of the Company. Subsequently Mr. PrabhakarNandiraju was confirmed as the Resolution Professional ("RP") by the committeeof creditors ("CoC") at their meeting held on June 01 2018 on appointment ofthe IRP/RP the powers of the Board of Directors of the Company were suspended.
The RP invited expressions of interest and submission of a resolutionplan in accordance with the provisions of the Code. Out of various resolution planssubmitted by Resolution Applicants the CoC approved the resolution plan submitted by M/s.Cosyn Limited consortium (M/s. Cosyn Limited M/s. RRK Enterprise Pvt Ltd and Mr SivaLakshmana Rao Kakarala). The RP submitted the CoC approved resolution plan to the NCLT onDecember 10 2018 for its approval and the NCLT Hyderabad Bench approved the resolutionplan submitted by M/s. Cosyn Limited consortium on July 31 2019 ("IBC/NCLTOrder"). Pursuant to the NCLT order M/s. Cosyn Limited consortium is under processof implementation of Resolution Plan. A new Board was constituted on August 07 2019("Reconstituted Board" or "Board") and a new management was put inplace. In accordance with the provisions of the Code and the NCLT order the approvedresolution plan is binding on the Company and its employees members creditorsguarantors and other stakeholders involved.
The entire payments contemplated under the resolution plan were paid tothe financial creditors and upon the completion of entire payment the IA No. 166/2021 inCP(IB) No. 24/7/HDB/2018 was disposed of by the Hon'ble NCLT Hyderabad bench vide itsOrder dated July 22 2021.
The Board Meeting held on June 30 2021 approved the reduction ofcapital from ' 440508638/- comprising of 220254319 equity shares of f 2/- each to f110128000/- comprising of 55064000 equity shares of f 2/- each and obtained theapproval for recommencement of trading for the said reduced capital from the stockexchanges w.e.f. December 17 2021. Thereafter the Board Meeting held on February 122022 issued the said reduced equity shares of 165190319 to the resolution applicant(s)i.e. new promoters and to the strategic investors i.e. non-promoters. In addition to theabove shares the Board also issued 1192024 equity shares to the strategic investors.The total issue size is 166382343 equity shares at different prices i.e. for the newpromoters the issue price is f 3.40/- per share and to the non-promoters the issue priceis f 20/- per share. The Company obtained the in-principal approvals from the stockexchanges on March 15 2022 and thereafter vide its Board Meeting held on March 25 2022allotted the said shares. The Company obtained the listing approvals from the stockexchanges on April 05 2022 (NSE) and April 07 2022 (BSE) for the said allotted shares.The Company obtained the trading approvals from the stock exchanges on April 13 2022 forthe said allotted 166382343 equity shares of f 2/- each w.e.f. April 18 2022.
During the year under review the Company have completed thestructuring of equity capital and fresh issue of equity shares to resolution applicant(s)i.e. the new promoters as contemplated under clause 7 of the approved resolution plan.
Members are requested to read this report in light of the fact that thenew Board of Directors and the management has successfully completed the implementation ofthe approved resolution plan during the year under review.
In compliance with the provisions of the Companies Act 2013 ('Act')and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 ('ListingRegulations') the Company has prepared its financial statements as per Indian AccountingStandards ('Ind AS') for the FY 2021-22. The financial highlights of the Company'sstandalone operations are as follows:
(Amount in f Lakhs)
|Particulars ||2021-22 ||2020-21 |
|Total Income ||3233.57 ||423.24 |
|Total Expenditure ||2952.48 ||964.56 |
|Profit before Tax ||281.09 ||(541.32) |
|Provision for Tax ||-- ||-- |
|Profit after Tax ||281.09 ||(541.32) |
|Transfer to General Reserve ||-- ||-- |
|Profit available for appropriation ||-- ||-- |
|Provision for Proposed Dividend ||-- ||-- |
|Provision for Corporate Tax ||-- ||-- |
The financial highlights of the Company's consolidated operations areas follows:
|Particulars ||2021-22 ||2020-21 |
|Total Income ||4625.28 ||423.24 |
|Total Expenditure ||4322.06 ||964.88 |
|Profit before Tax ||303.23 ||(541.65) |
|Provision for Tax ||6.95 ||-- |
|Profit after Tax ||296.28 ||(541.65) |
|Transfer to General Reserve ||-- ||-- |
|Profit available for appropriation ||-- ||-- |
|Provision for Proposed Dividend ||-- ||-- |
|Provision for Corporate Tax ||-- ||-- |
The total revenue of the Company for the financial year ended March 312022 was f 3233.57 Lakhs as compared to the previous year's total revenue of f 423.24Lakhs. During this financial year the Company has earned a net profit of f 281.09 Lakhs asagainst the previous year's net loss of f 541.32 Lakhs.
During the year under review your company executed regular AnnualMaintenance Contracts (AMC) of Indian Railways and executed certain lighting and displayorder of private parties. The Company received the Oxygen Concentrators (OCs) supply orderfrom the Oil and Natural Gas Commission (ONGC) in the Month of June 2021 for the quantityof 5000 OCs and the order value is f 33 Crores inclusive of taxes. The ONGC order wassuccessfully completed during the year under review. The management of the Company isstudying the business lines of the Company in order to identify and focus on the profitgenerating lines apart from the regular AMCs of Indian Railways. The management of theCompany is focused on revival of the Passenger Information System (PIS) division of theCompany which supplies the LED display boards to the Indian Railways and to the privateparties including the government bodies. The management of the Company is also focused onestablishment of manufacturing/assembling unit of all kinds of batteries in particular forelectric vehicles and also to enter the market of electric two wheelers.
Change in the nature of business
There was no change in nature of the business of the Company during thefinancial year ended on March 31 2022. However during the year under review the Companyhad entered in to two new lines of business verticals i.e. Manufacturing/ assembling/trading of Oxygen Concentrators (Medical Equipment) and Electric Vehicles including allkinds of batteries.
These are unprecedented times as our country and the entire worldstruggle to contain and combat the COVID-19 pandemic. Amidst such rampant uncertaintieswe have abided by every safety and social distancing norms and have been consistentlycommunicating the same to both our employees and customers. We stand in solidarity withthe Government of India and all our citizens and our efforts towards the betterment ofone and all will continue unabated.
During the F.Y. 2021-22 the authorised share capital of the Companywas increased in the 33 rd AGM of the Company held on December 27 2021 from f540000000/- (Rupees Fifty-Four Crores Only) divided into 270000000 (Twenty-SevenCrores) equity shares of f 02/- (Rupees Two Only) each to f 750000000/- (RupeesSeventy-Five Crores Only) divided into 375000000 (Thirty-Seven Crores Fifty Lakhs)equity shares of f 02/- (Rupees Two Only) each.
At the start of the F.Y. 2021-22 the paid-up share capital of theCompany was f 440508638/- (Rupees Forty-Four Crores Five Lakhs Eight Thousand SixHundred and Thirty-Eight Only) divided into 220254319 (Twenty-Two Crores Two LakhsFifty-Four Thousand Three Hundred and Nineteen) equity shares of f 02/- (Rupees Two Only)each.
In compliance with the approved resolution plan the erstwhile paid-upequity shares capital of the Company as mentioned above was reduced to f 110128000/-(Rupees Eleven Crores One Lakh Twenty-Eight Thousand Only) divided into 55064000 (FiveCrores Fifty Lakhs Sixty-Four Thousand) equity shares of f 02/- (Rupees Two Only) each atBoard of Directors meeting held on June 30 2021 due to which the trading in the shares ofthe Company was suspended w.e.f. June 24 2021. The Company had obtained the listing& trading approvals from the stock exchanges i.e. NSE & BSE for the said reducedcapital for re-commencement of trading w.e.f. December 17 2021.
Later the board of directors in its meeting held on February 12 2022issued 166382343 (Sixteen Crores Sixty-Three Lakhs Eighty-Two Thousand Three Hundredand Forty-Three) equity shares of f 2/- (Rupees Two Only) each at a premium of f 1.40/-(Rupees One and Forty Paisa Only) each for 164682343 (Sixteen Crores Forty-Six LakhsEighty-Two Thousand Three Hundred and Forty-Three) Equity Shares to the Promoters(Resolution Applicants) and f 18.00/- (Rupees Eighteen Only) each for the balance1700000 (Seventeen Lakhs) Equity Shares to
the Non-promoters (Strategic Investors) for which the in-principleapprovals from the stock exchanges were obtained on March 15 2022 and allotment was madeby the Board of Directors in its meeting held on March 25 2022. The Company had obtainedthe listing & trading approvals for said allotments on April 07 2022 & April 132022 and the trading in the said allotted shares will commence from April 18 2022.However the said allotted shares will be under lock-in for a period of one year.
The paid-up capital as at the end of the F.Y. 2021-22 is ?442892686/- (Rupees Forty-Four Crores Twenty-Eight Lakhs Ninety-Two Thousand SixHundred and Eighty-Six Only) divided into 221446343 (Twenty-Two Crores Fourteen LakhsForty-Six Thousand Three Hundred and Forty- Three) equity shares of ? 02/- (Rupees TwoOnly) each.
Transfer to reserves
For the financial year ended March 31 2022 the Company has nottransferred any amount to General Reserves and Surplus Account. Dividend
The Company has not declared any dividend during the year.
Buy Back of shares and disinvestment
The Company has not bought back any of its securities and there was nodisinvestment during the Financial Year ended March 31 2022.
Indian Accounting Standards (Ind AS)
The Company has adopted Indian Accounting Standards (Ind AS) witheffect from April 1 2017 pursuant to Ministry of Corporate Affairs' notification of theCompanies (Indian Accounting Standards) Rules 2015. The standalone and consolidatedfinancial statements of the Company forming part of the Annual Report have been preparedand presented in accordance with all the material aspects of the Indian AccountingStandards ('Ind AS') as notified under section 133 of the Companies Act 2013 read with theCompanies (Indian Accounting Standards) Rules 2015 (by Ministry of Corporate Affairs('MCA')) and relevant amendment rules issued thereafter and guidelines issued by theSecurities Exchange Board of India ("SEBI").
Transfer of unclaimed Dividend(s)/ Shares to Investor Education andProtection Fund
During the FY 2021-22 there was no unpaid/ unclaimed dividendpertaining to FY 2013-14 to be transferred to the Investors Education and Protection Fund('IEPF') Account established by the Central Government.
Pursuant to the provisions of Investor Education and Protection FundAuthority (Accounting Audit Transfer and Refund) Rules 2016 as amended the shares onwhich dividend remains unpaid / unclaimed for seven consecutive years or more shall betransferred to the Investor's Education and Protection Fund ('IEPF') after giving duenotices to the concerned shareholders which is not applicable to the Company during theyear.
Unclaimed securities demat suspense account
There were no unclaimed securities to be kept in the demat suspenseaccount.
The Company has not accepted any deposits from public in terms ofSection 73 of the Companies Act 2013 and as such no amount on account of principal orinterest on public deposits was outstanding as on the date of the balance sheet for the FY2021-22.
Significant and material orders passed by the regulators
During the FY 2021-22 there were no significant and material orderspassed by the regulators or courts or tribunals impacting the going concern status andCompany's operations in future.
Material changes and commitments
There were no material changes and commitments affecting the financialposition of the Company between the end of the financial year March 31 2022 to which thefinancial statements relates and the date of signing of this report.
Board of Directors
During the start of the FY 2021-22 the following are the Directors onthe Board of the Company
|Sl.No. Name of the Director ||DIN ||Designation |
|1 Mr Vishnu Ravi ||01144902 ||Executive Director |
|2 Mr Siva Lakshmana Rao Kakarala ||03641564 ||Non-executive Director |
|3 Mr Srinivas Medasani ||00827476 ||Independent Director |
|4 Ms Karuna Gayathri Upadhyayula ||07901195 ||Independent Director |
Mr Vishnu Ravi resigned as Director of the Company on June 30 2021 andMr Srinivas Medasani resigned as Director of the Company on July 05 2021. The boardplaced vote of appreciation for their services during their tenure.
The Board of Directors in its meeting held on July 06 2021 hadappointed Mr Kaushik Yalamanchili holding DIN: 07334243 as Additional Director in thepromoter category and Mr Manideep Katepalli holding DIN: 07840019 as Additional Directorin the Independent Director category.
Upon recommendations of the Nomination and Remuneration Committee inits meeting held on September 16 2021 the Board of Directors in its meeting held onSeptember 16 2021 appointed Mr Kaushik Yalamanchili as Managing Director of the Companyfor a period of three years subject to the approval of members and the members approvedhis appointment at the 33rd AGM of the Company held on December 27 2021. The Board ofDirectors in its meeting held on March 12 2022 had appointed Mr Srinivas Rao Kolliholding DIN: 07980993 and Mrs Venkata Naga Lavanya Kandala holding DIN: 07891405 asAdditional Directors in the Independent Director category subject to approval of memberswithin a period of 3 (three) months from the date of their appointment.
The members through postal ballot dated June 04 2022 approved theappointment of Mr Srinivas Rao Kolli and Mrs Venkata Naga Lavanya Kandala as Directors ofthe Company in the Independent Director category for a period of five years w.e.f. March12 2022.
As on March 31 2022 the board of directors of the Company consists ofthe following directors:
|Sl.No. Name of the Director ||DIN ||Designation |
|1 Mr Kaushik Yalamanchili ||07334243 ||Chairman & Managing Director |
|2 Mr Siva Lakshmana Rao Kakarala ||03641564 ||Non-executive Director |
|3 Mr Manideep Katepalli ||07840019 ||Independent Director |
|4 Ms Karuna Gayathri Upadhyayula ||07901195 ||Independent Director |
|5 Mr Srinivas Rao Kolli ||07980993 ||Independent Director |
|6 Mrs Venkata Naga Lavanya Kandala ||07891405 ||Independent Director |
Key Managerial Personnel
During the FY 2021-22 the Company is having the following KMPs
1. Mr Vishnu Ravi - Managing Director1
2. Mr Muralikrishnan Sadasivan Madurai - Company Secretary2
3. Mr Kaushik Yalamanchili - Managing Director3
4. Mr Muralikrishnan Sadasivan Madurai - Chief Financial Officer4
5. Mr Srikanth Reddy Kolli - Company Secretary5
6. Mr Srinivasan Arunachalam - Chief Executive Officer6
1 Mr Vishnu Ravi was resigned w.e.f. June 30 2021.
2 Mr Muralikrishnan Sadasivan Madurai was resigned w.e.f.September 30 2021.
3 Mr Kaushik Yalamanchili was appointed w.e.f. September 162021.
4 Mr Muralikrishnan Sadasivan Madurai was appointed w.e.f.October 012021.
5 Mr Srikanth Reddy Kolli was appointed w.e.f. October 01 2021.
6 Mr Srinivasan Arunachalam was appointed w.e.f. February 122022.
Declaration by the Independent Directors
The Company has received declarations from all independent directors ofthe Company confirming that they continue to meet the criteria of independence asprescribed under Section 149 of the Companies Act 2013 rules made there under and SEBILODR Regulations. The Independent Directors have also confirmed that they have compliedwith the Company's code of conduct.
Policy on Directors' appointment and remuneration and other details
The Board has on the recommendation of the Nomination and RemunerationCommittee framed a policy for selection and appointment of Directors and Senior Managementpersonnel and fix their remuneration. The detailed policy is available on the Company'swebsite at www.mic. co.in.
Annual Board Evaluation
The board of directors has carried out an annual evaluation of its ownperformance board committees and individual directors pursuant to the provisions of theAct and the corporate governance requirements as prescribed by Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015("SEBI Listing Regulations").
The performance of the board was evaluated by the board after seekinginputs from all the directors on the basis of the criteria such as the board compositionand structure effectiveness of board processes information and functioning etc.
The performance of the committees was evaluated by the board afterseeking inputs from the committee members on the basis of the criteria such as thecomposition of committees effectiveness of committee meetings etc.
The board and the nomination and remuneration committee reviewed theperformance of the individual directors on the basis of the criteria such as thecontribution of the individual director to the board and committee meetings likepreparedness on the issues to be discussed meaningful and constructive contribution andinputs in meetings etc. In addition the chairman was also evaluated on the key aspectsof his role.
In a separate meeting of independent directors performance ofnon-independent directors performance of the board as a whole and performance of thechairman was evaluated taking into account the views of executive directors andnon-executive directors. The same was discussed in the board meeting that followed themeeting of the independent directors at which the performance of the board itscommittees and individual directors was also discussed. Performance evaluation ofindependent directors was done by the entire board excluding the independent directorbeing evaluated.
Criteria for Performance Evaluation:
a. Ability of the candidates to devote sufficient time and attention tohis professional obligations as Independent Director for informed and balanced decisionmaking.
b. Adherence to the Code of Conduct in letter and in spirit by theIndependent Directors.
c. Bringing objectivity and independence of view to the Board'sdiscussions in relation to the Company's strategy performance and risk management
d. Statutory Compliance and ensuring high standards of financialprobity and Corporate Governance
e. Responsibility towards requirements under the Companies Act 2013Responsibilities of the Board and accountability under the Director's ResponsibilityStatement.
A handbook covering the role functions duties and responsibilitiesand the details of the compliance requirements expected from the Directors under the Actand relevant Regulations of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 were given and explained to the new Directors.
The newly appointed Directors are given induction and orientation withrespect to Company's Vision Core purpose Core Values and Business operations. Inaddition detailed presentations are made by Senior Management Personnel on businessenvironment performance of the Company at every Board Meeting.
The above initiatives help the Directors to understand the Company itsbusiness and the regulatory framework in which the Company operates and enables theDirectors to fulfil their role/responsibility.
Details of Familiarization Programme for the Independent Directors areuploaded on the website of the Company at www.mic.co.in.
Particulars in respect of conservation of energy technologyabsorption foreign exchange earnings and outgo
The information on Conservation of Energy Technology AbsorptionForeign Exchange Earnings and outgo required to be disclosed under Section 134(3)(m) ofthe Companies Act 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 areprovided in the Annexure-I forming part of this Report.
Subsidiary Associate and Joint Venture Companies
As on April 012021 your Company has one wholly owned subsidiary -M/s. MIC Electronics Inc. USA. The said subsidiary has been wound up and dissolved underthe laws of the state of California USA w.e.f. June 21 2021.
As on March 31 2022 your Company is having one subsidiary (50.99%) -M/s. Bikewo Green Tech Pvt Ltd (formerly known as M/s. Right Automobiles Pvt Ltd).
As per the provisions of Section 129(3) of the Companies Act 2013 (theAct) read with Companies (Accounts) Rules 2014 a statement containing the salientfeatures of the financial statements of the Subsidiary in Form AOC-1 is enclosed asAnnexure-II to this Report.
Performance and financial position of each of the subsidiariesassociates and joint ventures: As per Rule 8 of Companies (Accounts) Rules 2014 a Reporton the performance and financial position of each of the subsidiaries associates andjoint venture companies of the Company is enclosed as Annexure-II to this Report.
Related Party Transactions
All transactions entered with Related Parties for the year under reviewwere on arm's length basis and in the ordinary course of business. There were nomaterially significant related party transactions made by the Company with PromotersDirectors Key Managerial Personnel or other designated persons which may have a potentialconflict with the interest of the Company at large. All Related Party Transactions wereplaced before the Audit Committee and also the Board for approval where ever required.Prior omnibus approval of the Audit Committee was obtained for the transactions which areof a foreseeable and repetitive nature. A statement giving details of all related partytransactions entered into pursuant to the omnibus approval so granted were placed beforethe Audit Committee and the Board of Directors on a quarterly basis. The Company hasdeveloped a Policy on Related Party Transactions for the purpose of identification andmonitoring of such transactions. The policy on Related Party Transactions as approved bythe Board is uploaded on the Company's website www.mic.co.in.
The particulars of contracts or arrangements with related partiesreferred to in sub-section (1) of section 188 is prepared in Form AOC-2 pursuant to clause(h) of the Companies (Accounts) Rules 2014 and the same is annexed herewith asAnnexure-III to this Report.
Statement of Particulars of Appointment and Remuneration of ManagerialPersonnel/ employees:
Information required pursuant to Section 197 (12) of the Companies Act2013 read with Rule 5 of The Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is provided along with a statement containing inter alia names ofemployees employed throughout the financial year and in receipt of remuneration of Rs. 102lakhs or more employees employed for part of the year and in receipt of Rs. 80.50 lakhsor more per annum pursuant to Rule 5(2) the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is provided as
Annexure-IV to this report.
At the 33rd AGM held on December 27 2021 the members approved theappointment of M/s. Bhavani & Co. Chartered Accountants (Firm Registration No.012139S) as Statutory Auditors of the company to hold office for a period of five yearsfrom the conclusion of 33 rd AGM till the conclusion of the 38th AGM. The requirement toplace the matter relating to appointment of auditors for ratification by Members at everyAGM has been done away by the Companies (Amendment) Act 2017 with effect from May 072018. Accordingly no resolution is being proposed for ratification of appointment ofstatutory auditors at the ensuing AGM.
(a) Statutory Auditors Report
The board of directors in its meeting held on May 25 2022 dulyreviewed the Statutory Auditor's Report on the Accounts for the year ended March 31 2022and has noted there were no qualifications/ emphasis of the matter and hence no managementreplies were required to be given.
(b) Internal Auditors
During the year under review the Company has appointed M/s. RKSB &Associates Chartered Accountants Hyderabad as internal auditors to review internalcontrols and operating systems and procedures as per the scope of audit.
The Board of Directors on recommendation of the Audit Committeeappoints/re-appoints the Internal Auditors of your Company every year in compliance withSection 138 of the Act read with the Companies (Accounts) Rules 2014.
(c) Cost Auditors
Pursuant to the rules made by the Central Government under sub-section(1) of Section 148 of the Act the maintenance of cost records is not applicable to thecompany for the year under review.
(d) Cost Audit Records
Appointment of Cost Auditors is not applicable as the turnover is lessthan applicable limit and hence maintenance of cost records was not applicable to theCompany.
(e) Secretarial Auditors and Report
The Board has appointed Mr Y Ravi Prasada Reddy proprietor of M/s. RPR& Associates Practising Company Secretaries as Secretarial Auditors of the Companyfor the financial year ended March 31 2022 who had given their consent and eligibility toact as the Secretarial Auditors of the Company.
The Secretarial Audit for the financial year ended March 31 2022 wascarried out by M/s. RPR & Associates Practicing Company Secretaries. The Report givenby the Secretarial Auditors in Form MR-3 is annexed as Annexure-V and forms integral partof this Report.
The board of directors in its meeting held on July 20 2022 dulyreviewed the Secretarial Auditor's Report for the year ended March 31 2022 and has notedthe following qualifications/ observations/ deviations together with the managementreplies:
|Secretarial Auditors Qualifications in the Secretarial Audit Report ||Management Replies |
|Delay in compliance with various regulations of SEBI LODR like Regulation 7 13 23(9) 31 46 etc ||The Company complied with the requirement of said regulations with delay due to Covid-19 and the transition process from Resolution Professional (RP) to the new management as per the Resolution Plan approved by the Hon'ble NCLT Hyderabad bench. |
|Delay in submission of Annual Secretarial Compliance Report for the FY 2020-21 as required by the SEBI Circular dated February 08 2019. ||The then secretarial auditor of the Company who was supposed to give this report was demised in the Month of May 2021 and henceforth it was submitted with delay after appointing new secretarial auditor for issuing the said report. |
|Delay in compliance of Section 203(1 ) of the Companies Act 201 3 with respect to appointment of Chief Financial Officer during the FY 2021-22. ||The Company appointed the Chief Financial Officer w.e.f. October 01 2021. |
|Delay in compliance of Section 138 read with rule 13 of Companies Accounts Rules 2014 with respect to Appointment of Internal auditor. ||The Company appointed the internal auditors in its board meeting held on November 12 2021 to audit for the whole financial year 2021-22 on a quarterly basis. |
|Delay in compliance of Section 21A of Securities Contracts (Regulation) Act 1956 read with Rule 21 of Securities Contracts (Regulation) Rules 1957 and SEBI (Regulatory fees on Stock Exchanges) Regulations 2006. ||All the dues of stock exchanges were paid during the year 202122 by the new management. |
|During the year the Stock Exchanges levied Fines/ penalties on the Company for non-compliance or delay compliance with SEBI LODR Regulations/ non-submission or delay in submission of various disclosures/ certificates required to be submitted under SEBI LODR Regulations. ||The Company applied for waiver of SOP fines with the stock exchanges based on the immunity provided under the Resolution Plan approved by the Hon'ble NCLT Hyderabad bench and obtained the waiver from both the BSE & NSE on March 09 2022 & March 10 2022. |
In terms of the amended SEBI (Listing Obligation and DisclosureRequirements) Regulation 2015 the Company had obtained the Secretarial Compliancecertificate for the FY 2021-22 from M/s. RPR & Associates Practicing CompanySecretaries which is annexed as Annexure-V(A) and forms integral part of this Report andthe same was also intimated to the Stock Exchanges where the shares of the Company arelisted.
Pursuant to Regulation 34(3) and Schedule V Para C clause (10)(i) ofthe SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 Company hasobtained a certificate on non-disqualification of directors from Mr Y Ravi Prasada Reddy(Membership No. : FCS 5783) Proprietor of M/s. RPR & Associates Practicing CompanySecretaries (PCS Registration No. 5360) which is annexed as Annexure- V(B) and formsintegral of this Report.
Corporate Social Responsibility (CSR)
Since the Company did not have profits (average net profits for thelast three financial years) it was not obligated to contribute towards CSR activitiesduring FY 2021-22. However the Company is committed to build its CSR capabilities on asustainable basis and undertake CSR activities as and when the opportunity arises.
The Annual Report on Corporate Social Responsibility u/s 135 of theCompanies Act 2013 is not required to be given as the Company was not required tocontribute towards CSR activities during FY 2021-22.
Management Discussion and Analysis Report
In terms of the provisions of SEBI (Listing Obligations &Disclosure Requirements) Regulations 2015 as amended from time to time the Management'sDiscussion and Analysis for the year ended march 312022 is annexed hereto as Annexure-VIand forms integral of this Report.
Corporate governance is an ethically driven business process that iscommitted to values aimed at enhancing an organization's brand and reputation. This isensured by taking ethical business decisions and conducting business with a firmcommitment to values while meeting stakeholders' expectations. It is imperative that yourcompany's affairs are managed in a fair and transparent manner. This is vital to gain andretain the trust of the stakeholders.
The Report on corporate governance for the year ended March 31 2022pursuant to Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 is annexed hereto as Annexure-VII and forms integral of this Report.
Auditors' certificate on Corporate Governance
As required by SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015 the auditor's certificate on corporate governance regarding thecompliance of conditions forms integral of this Report.
Statement containing additional information as required under ScheduleV of the Companies Act 2013
A statement containing additional information as required under ClauseIV of Section II of Part II of Schedule V of the Companies Act 2013 is provided in theReport on Corporate Governance which forms part of this Annual Report.
During the year the risk assessment parameters were reviewed. Theaudit committee reviewed the element of risks and the steps taken to mitigate the risks.In the opinion of the Board there are no major elements of risk which have the potentialof threatening the existence of the Company.
The audit committee provides the framework of Risk Management bydescribing mechanisms for the proactive identification and prioritization of risks basedon the scanning of the external environment and continuous monitoring of internal riskfactors.
Analysis of the risks identified is carried out by way of focuseddiscussion at the meetings of the Board. The robust governance structure has also helpedin the integration of the Enterprise Risk Management process with the Company's strategyand planning processes where emerging risks are used as inputs in the strategy andplanning process. Identified risks are used as one of the key inputs in the strategy andbusiness plan.
Internal Financial Control Systems and their adequacy
The Company has an Internal Control System commensurate with the sizescale and complexity of its operations.
Various Audit Systems in the Company monitors and evaluates theefficacy and adequacy of internal control system in the Company its compliance withoperating systems accounting procedures and policies of the Company. Based on the auditreports Company undertakes corrective actions in respective areas and strengthens thecontrol. Significant audit observations and corrective actions thereon are presented tothe Audit Committee of the Board periodically.
The Board of Directors of the Company have adopted various policieslike Related Party Transactions policy Whistle Blower Policy and such other proceduresfor ensuring the orderly and efficient conduct of its business for safeguarding itsassets the prevention and detection of frauds and errors the accuracy and completenessof the accounting records and the timely preparation of reliable financial information.The details in respect of internal financial control and their adequacy are included inthe management discussion & analysis which forms part of this report. ConsolidatedFinancial Statements
The Consolidated Financial Statements of the Company and its subsidiaryfor FY 2021-22 are prepared in compliance with the applicable provisions of the Act andas stipulated under Regulation 33 of the Listing Regulations as well as in accordance withthe Indian Accounting Standards notified under the Companies (Indian Accounting Standards)Rules 2015. The Audited Consolidated Financial Statements together with the Auditor'sReport thereon forms part of this Annual Report.
Pursuant to the provisions of Section 136 of the Act the FinancialStatements of the Company Consolidated Financial Statements along with relevant documentsand separate annual accounts in respect of subsidiary are available on the website of theCompany. The annual accounts of the subsidiary and related detailed information will bemade available to investors seeking information till the date of the ensuing 34th AGM.
Listing of Company's Equity Shares
The Company's Equity shares were listed with M/s. BSE Limited and M/s.National Stock Exchange of India Limited (Stock Exchanges). Due to capital reduction from? 440508638/- to ? 110128000/- approved by the Board of Directors in its meetingheld on June 30 2021 as required by the Resolution Plan approved by the Hon'ble NCLTHyderabad bench the trading in shares of the Company suspended by the stock exchangesfrom June 24 2021 onwards.
The stock exchanges i.e. NSE & BSE had granted approval forrecommencement of trading in the said reduced capital of ? 110128000/- divided in to55064000 equity shares of ? 2/- each with effect from December 17 2021 and alsoobtained the trading approval from the stock exchanges for the newly allotted equityshares of 166382343 to the promoters and non-promoters w.e.f. April 18 2022.
The Company has paid the Annual Listing Fees to the said Stock Exchangefor the Financial Year 2021-22.
Whistle blower Policy
The Company has adopted a Whistle-blower Policy to provide a formalmechanism to the Directors Employees and its Stakeholders to report their concerns aboutunethical behaviour actual or suspected fraud or violation of the Company's Code ofConduct. Protected disclosures can be made by a whistle-blower through several channels.
The Policy provides for adequate safeguards against victimisation ofemployees who avail of the mechanism and also provides for direct access to theChairperson of the Audit Committee. No personnel of the Company have been denied access tothe Audit Committee.
The Whistle-blower Policy also facilitates all employees of the Companyto report any instance of leak of Unpublished Price Sensitive Information. The Policy isalso posted on the website of the Company at www.mic.co.in.
Reporting of Fraud
During the year under review the Statutory Auditors Internal Auditorsand Secretarial Auditors have not reported any instances of frauds committed in theCompany by its Officers or Employees to the Audit Committee under Section 143(12) of theAct details of which need to be mentioned in this Report.
Declaration as per Section 134(3) of the Companies Act 2013
During the year the statutory auditors and secretarial auditors havenot reported any instances of frauds committed by or against the Company by its Directors/Officers/ Employees to the Audit Committee or Board under section 143 (12) of theCompanies Act 2013 and rules made thereof. Therefore no details are required to bedisclosed under Section 134 (3) (ca) of the Act.
As required under section 92(3) of the Companies Act 2013 and rule12(1) of the Companies (Management and Administration) Rules 2014 (as amended) a copy ofthe Annual Return of the Company for the FY 2021-22 will be placed on the website of theCompany at www.mic.co.in.
Prevention of Sexual Harassment of Women at Workplace
The Company has adopted policy on Prevention of Sexual Harassment ofWomen at Workplace in accordance with The Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013. The internal complaints committee wasduly constituted as required. During the financial year ended March 31 2022 the Companyhas not received any Complaints pertaining to Sexual Harassment.
Particulars of Loans Guarantees or Securities or Investments
During the year under review the Company had given unsecured loan of ?8 Crores to M/s. Swift Vitthiya Samavesh Pvt Ltd and made an investment of ? 3.33 Croresby way of subscribing to 1040300 equity shares of ? 10/- each at a premium of ? 22/-each of M/s. Bikewo Green Tech Pvt Ltd (formerly known as M/s. Right Automobiles Pvt Ltd).
Managing Director (MD) & Chief Financial Officer (CFO)Certification
The Managing Director and the Chief Financial Officer of the Companyhave given annual certification on financial reporting and internal controls to the Boardin terms of Regulation 17(8) of the SEBI (Listing Obligation & DisclosureRequirements) Regulation 2015 for the FY 2021-22.
They had also given quarterly certification on financial results whileplacing the quarterly results before the Board in terms of Regulation 33(2)(a) of the SEBI(Listing Obligation & Disclosure Requirements) Regulation 2015.
The annual certificate given by the Managing Director & the ChiefFinancial Officer of the Company forms integral part of this report.
Meetings of the Board of Directors and its Committees during theFinancial Year 2021-22
During the year under review the Board convened eight (8) meetings.The dates of the eight meetings are June 30 2021 July 06 2021 August 14 2021September 16 2021 November 12 2021 February 12 2022 March 12 2022 and March 252022.
The details were disclosed in the report on Corporate Governance whichforms part of this Annual Report. The intervening gap between any two meetings was withinthe prescribed period.
All the recommendations made by committees of the Board including theAudit Committee were accepted by the Board. A detailed update on the Board itscomposition detailed charter including terms and reference of various Board Committeesnumber of Board and Committee meetings held during FY 2021-22 and attendance of theDirectors at each meeting is provided in the Report on Corporate Governance which formspart of this Report.
Committees of the Board
The Composition of Audit Committee Nomination & RemunerationCommittee and Stakeholders Relationship Committee are mentioned in the Report on CorporateGovernance.
Nomination and remuneration policy
The Board has on the recommendation of the Nomination &Remuneration Committee framed a policy which lays down a framework in relation toselection appointment and remuneration to Directors Key Managerial Personnel and SeniorManagement of the Company. The details of Nomination and Remuneration Committee and Policyare stated in the Corporate Governance Report.
The management believes that competent and committed human resourcesare vitally important to attain success in the organisation. In line with this philosophyutmost care is being exercised to attract quality resources and suitable training isimparted on various skillsets and behaviour. Various initiatives were undertaken toenhance the competitive spirit and encourage bonding teamwork among the employees whichresulted to uninterrupted operations of the Company and could achieve the targeted growthin the performance of the Company.
All properties and insurable interests of the Company includingbuildings plant and machinery and stocks have been fully insured.
Revision of Financial Statements
There was no revision of the financial statements for the year underreview.
Compliance with SEBI (LODR) regulations 2015
In compliance with SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company has signed uniform listing agreement with M/s.BSE Limited and M/s. National Stock Exchange of India Limited and framed the requiredpolicies which are available on Company's website i.e. www.mic.co.in.
Board Diversity Policy
Policy on preservation of Documents
Risk Management Policy
Whistle Blower Policy
Familiarisation programme for non-executive directors
Sexual Harassment Policy
Policy on related party transactions
Code of Conduct and Ethics
Nomination and Remuneration Policy
Policy to determine materiality
Code for prohibition of insider trading
Code of fair disclosure
Non-Executive Directors Compensation and disclosures
None of the Independent / Non-Executive Directors has any pecuniaryrelationship or transactions with the Company which in the Judgment of the Board mayaffect the independence of the Directors. The details of sitting fee paid were given inthe Report on corporate governance.
Industry Based Disclosure
The Company is not a NBFC Housing Companies etc. and hence Industrybased disclosures is not required.
Event Based Disclosure
During the year under review the Company has not taken up any of thefollowing activities:
1. Issue of sweat equity share: The Company has not issued any sweatequity shares during the year under review and hence no information as per provisions ofSection 54(1)(d) of the Act read with Rule 8(13) of the Companies (Share Capital andDebenture) Rules 2014.
2. Issue of shares with differential rights: The Company has not issuedany shares with differential rights and hence no information as per provisions of Section43(a)(ii) of the Act read with Rule 4(4) of the Companies (Share Capital and Debenture)Rules 2014.
3. Issue of shares under employee's stock option scheme: The Companyhas not issued any equity shares under Employees Stock Option Scheme during the year underreview and hence no information as per provisions of Section 62(1)(b) of the Act isrequired to be given.
4. Disclosure on purchase by company or giving of loans by it forpurchase of its shares: The Company did not purchase or give any loans for purchase of itsshares.
5. Preferential Allotment of Shares: The Company in its board meetingheld on March 25 2022 has allotted 166382343 equity shares of ? 02/- each onpreferential basis to the promoters and non-promoters in compliance with the approvedresolution plan and obtained the listing & trading approvals from the stock exchangesfor the said allotment.
Employees Stock Options
No employee was issued Stock Option during the year equal to orexceeding 1% of the issued capital of the Company at the time of grant. Directors'Responsibility Statement
Pursuant to the requirement under Section 134 of the Companies Act2013 with respect to the Directors' Responsibility Statement the Board of Directors ofthe Company hereby confirms:
i. In the preparation of the annual accounts the applicable accountingstandards have been followed along with proper explanation relating to materialdepartures;
ii. Such accounting policies as mentioned in the notes to the financialstatements have been selected and applied consistently and judgments and estimates thatare reasonable and prudent made so as to give a true and fair view of the state of affairsof the Company at the end of the financial year 2021-22 and of the statement of profit ofthe Company for that period;
iii. Proper and sufficient care has been taken for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
iv. The annual accounts for the year 2021-22 have been prepared on agoing concern basis.
v. Those proper internal financial controls were in place and that thefinancial controls were adequate and were operating effectively.
That a system to ensure compliance with the provisions of allapplicable laws were in place and were adequate and operating effectively.
The board wish to place on record its appreciation to employees at alllevels for their hard work dedication and commitment. The enthusiasm and unstintingefforts of the employees have enabled the Company to stream line all the pendingcompliances and thereby to have a fresh start for the Company.
Statements in this Report particularly those which relate toManagement Discussion and Analysis as explained in the Corporate Governance Reportdescribing the Company's objectives projections estimates and expectations mayconstitute 'forward looking statements' within the meaning of applicable laws andregulations. Actual results might differ materially from those either expressed or impliedin the statement depending on the circumstances.
The board take this opportunity to place on record their sincere thanksto the suppliers customers strategic partners Banks and Financial InstitutionsInsurance Companies Central and State Government Indian Railways stakeholders and theshareholders for their support and cooperation extended to the Company from time to time.The board is pleased to record its appreciation of the sincere and dedicated services ofthe employees and workmen at all levels.
| ||By order of the Board |
| ||For MIC Electronics Limited |
|Date: July 20 2022 ||Mr Kaushik Yalamanchili ||Mr Manideep Katepalli |
|Place: Hyderabad ||Managing Director ||Director |
| ||DIN: 07334243 ||DIN: 07840019 |