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MPS Infotecnics Ltd.

BSE: 532411 Sector: IT
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OPEN 0.48
VOLUME 1074356
52-Week high 0.48
52-Week low 0.05
Mkt Cap.(Rs cr) 181
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 0.48
CLOSE 0.46
VOLUME 1074356
52-Week high 0.48
52-Week low 0.05
Mkt Cap.(Rs cr) 181
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

MPS Infotecnics Ltd. (VISESHINFO) - Director Report

Company director report

Dear Members

Your Directors have pleasure in presenting the 30th (Thirtieth) Annual Report on thebusiness and operations of your company along with Audited Financial Statements for thefinancial year ended on March 31 2019.


MPS Infotecnics Limited ("MPS") is a company incorporated in the year1989 under the erstwhile Companies Act 1956 now The Companies Act 2013 and is presentlylisted on BSE Limited and National Stock Exchange of India Limited.

The Company is presently engaged in the following areas:

• System Integration and Networking Solutions (Including Hardware)

• Enterprise Software

• Domain Registration & Web hosting services

• Telecommunication

• VAS & IT enabled services

Your Company provides entire range of Servers Desktop and Notebook computers from HPIBM Acer & Sun Microsystems. MPS also offer peripherals from Hewlett PackardSamsung Epson Corp. & Canon and Power Correction Equipment from APC. Your Company hasarrangements with Cisco Systems HP Procurve Nortel Networks 3Com and Allied Telesyn forproviding its clients specialized data communication equipment such as Routers Switches& Remote Access Servers; Structured Cabling Systems from Systimax AMP and Nexans;Wireless connectivity products from Cisco SMC and NetGear; and storage solutions from HPIBM ADIC & EMC.

Your Company has field-proven expertise in all aspects of networking viz. Voice andData Switching X.25 Frame Relay ATM VLAN SNA and APPN TCP/IP Satellite Radio andFiber-Optic Transmission Local Area Networks (LAN) Wide Area Networks (WAN) andCommunication Software.

MPS spotted the potential of the Indian Software Industry in its teething stages anddeveloped various enterprise applications and off the shelf software products which werefocused around the customer's business processes. The Company has domain knowledge of ERPERP Consulting and Client Server technologies.

SignDomainsTM is India's first ICANN Accredited domain registrar which offerson-line domain registration of top level domains (TLD) including .com .net .org .info etc. Catering to a global client base through its online presence and secure paymentgateway. SignDomainsTM has several corporates large portals resellers andend-users as its clientele.

Your Company offers web-hosting solutions on the company's dedicated servers located atin server farms and data centres in India and the US. Value added services like SMSpayment gateways messaging e-identity management e-commerce are available for corporateclients and other businesses.

Your company had also developed B2B2C based multipurpose transaction platform and had provided business opportunities to the people in remoteareas of the country. The platform is used by retailers for providing a host of servicesto the visiting customers such as prepaid Mobile recharge Postpaid Mobile Bill PaymentDTH recharge landline bill payments data card recharge/payments etc. However withservice providers themselves providing mobile applications for recharge bill paymentsetc. the business had gone down considerably.

In fact the business of the company has considerably declined in all the sectors /areas in which it is engaged in. The main reason for the decline in the company's businessis due to stiff competition not only from the organised sector but also from un-organisedsector; various e-commerce portals are providing their goods and services along withlucrative schemes and that too on payment of cash; the company's business has suffered asthe company has to procure goods and services on cash and selling them on credit; thereare number of mobile application available which again provides their goods and serviceswith lucrative discounts and schemes.

Despite the fact that the company is facing stiff competition yet Your Company isexploring new avenues to increase its market share in the areas in which it operates. Yourcompany expects to gain substantial amount of the market share in the times to come.


The Financial Results (Standalone & Consolidated) of the Company for the periodunder review are as follows: -

(Rs. in lacs)

PARTICULA Standalone Consolidated
RS 2018-19 2017-18 2018-19 2017-18
Income from Operation 1700.39 7705.11 1700.39 7776.73
Other Income 12.49 685.86 12.49 685.87
Total Income 1712.88 8390.97 1712.88 8462.59
Total Expenditure 1835.52 7907.45 1835.52 7979.47
PBID & Tax (122.63) 483.52 (122.63) 483.13
Interest 59.99 321.17 59.99 321.17
Depreciation 352.14 162.53 352.14 162.53
Profit before tax (534.76) (0.18) (534.76) (0.56)
Provision for Taxation - - - -
Earlier Year Tax - (360.28) - (360.28)
Deferred Tax 348.38 108.98 348.38 108.98
Profit After Tax (PAT) (883.14) 251.13 (883.14) 250.74
Other Comprehensive Income 10.91 3.68 10.91 3.69
Total Comprehensive Income for the year (872.23) 254.81 (872.23) 254.43
Profit b/f. from previous Yr. (2284.89) (2536.02) (2284.40) (2535.14)
Balance Carried to B/Sheet (2819.65) (2284.89) (3167.54) (2284.40)
Paid up equity share Capital 37744.37 37744.37 37744.37 37744.37
Other equity 6612.89 7485.12 7311.64 8141.02


The Company has not revised its Financial Statements or Board's report for any of thethree preceding financial years.


In view of the losses incurred by the Company during the year under review the Boardof Directors of the Company has decided not to recommend any dividend.


In view of the losses no amount is being carried to reserves.


There is no change in the issued subscribed and paid-up equity share capital of theCompany.


There is no change in the nature of business of your company during the year underreview and Your Company continues to engage itself in System Integration and NetworkingSolutions (Including Hardware); Enterprise Software; Domain Registration & Web hostingservices; Telecommunication; VAS & IT enabled services. With stiff competition fromthe organised and unorganised sectors of the IT ITeS and Telecommunication segment yourcompany is exploring new avenues to generate revenues for the company.


Though there are no significant and material orders passed by the Regulator or courtsor Tribunals impacting the going concern status and the Company's operations in futureyet in order to provide a true fair and correct picture of the company your company isproviding below in brief litigations in which your company is involved which may have anadverse impact on the company:

(A) Your Company's name was included in the list of shell companies by SEBI and StockExchanges had placed trading restrictions on promoters / directors and placed the scrip in‘trade to trade' category with limitation on the frequency of trade and also imposedlimitation on the buyers by way of 200% deposit on the trade value. NSE vide its orderdated 10th January 2018 lifted / modified the actions envisaged in SEBI's letter dated7th August 2017 and appointed M/s. M.K. Aggarwal & Co. Chartered Accountants asforensic auditor to conduct audit of the affairs of the Company. The Forensic Auditors hadconcluded the forensic Audit. NSE vide its letter dated 13th January 2019 had forwardedthe Forensic Auditor's report and have sought clarification on certain observations madeby the Forensic Auditors. Your Company has already replied to the said queries /observations and is awaiting the response of NSE.

(B) The funds raised by the Company from GDR issue during F.Y. 2007-08 were kept infixed deposit account with Banco Efisa Lisbon Portugal as the said amount was to bedeployed in terms of INFORMATION MEMORANDUM of the GDR issue. During the F.Y. 2008-09Banco Efisa the Bank in Portugal wrongly debited an amount of USD 8883210.75 out ofthe balance lying in the Company's Account with the Bank.

The Company has denied and disputed this debit and had initiated civil and legal actionunder Portuguese Law in Lisbon at Portugal.

However during the pendency of the legal actions taken by your company SEBI alsostarted investigating the company's GDR issue. In January 2018 SEBI issued Show CauseNotice as to why suitable directions should not be issued for violation of variousregulation of SEBI (PUFTA) Regulations 2003. Your Company has suitably replied to thesame. In the reply submitted by your company with SEBI in response to the SCN had soughtpersonal hearing in the matter. However your company was served with a supplementary showcause notice where SEBI calling upon your company to show cause as to why the amount benot recovered from the company. Your company has replied the said supplementary Show CauseNotice.

Instead of providing an opportunity for personal hearing SEBI yet again served uponthe company notice to show cause as to why SEBI should not hold inquiry and impose penaltywhich has been suitably replied by your company.

A personal hearing in the matter was granted to your company which was availed and havesuitably argued the matter and upon conclusion of the arguments Your Company has alsosubmitted written submission. Your Company is awaiting the final orders.

(C) The Company had increased its Authorised Share Capital during the Financial Year2010-11 to 2012-13 however due to technical issues necessary forms along with the feesw.r.t. increase in authorised Capital could not be filed and paid. Meanwhile the scheduleof fees was increased as per the Companies Act 2013. However the Authorised ShareCapital was increased prior to the applicability of Companies Act 2013.

The company has filed a Writ Petition bearing No. WP(C) 5199 of 2015 before the Hon'bleHigh Court of Delhi challenging the applicability of provisions prescribed under Para 3 ofTable B under Companies (Registration Offices and Fees) Rules 2014 which has been decidedagainst the Company. On the advice of Company's Advocates Company Law experts yourcompany has preferred an appeal before the Hon'ble Supreme Court of India. Your Company'sCounsels are of the opinion that your company has a fit case for filing an appeal howeverin the eventuality orders passed against the company the same may not impact the goingconcern status and the Company's operations in future as necessary provision in the booksof accounts have been made in the books of the Company.


Your company is presently engaged on the following areas:

IT Solutions & Products which comprise of:

System Integration and Networking Solutions (including Hardware); Enterprise software;Trading of UID Kit.

The entire business has three modes of execution of business i.e. Trading of Hardwareand Peripherals; Establishing IT Infrastructure and Customization and up-gradation. Basedon the orders your company procures products / material from leading Dealers andDistributors of leading brands of IT and IT Infrastructure product manufacturers like HPSamsung LG Lenovo Dell Acer etc. thereafter the same are supplied.

During the year under review the revenue generated from the segment was Rs. 11.51 lacsthe breakup of which is as under:

Print EPIC Cars Rs. 10.87 Lacs
PAN Card Coupon Sale & Antivirus Sale Rs. 0.65 Lacs

IT Enabled Services comprising of:

Domain Registration & Web Hosting Services

VAS & IT enabled Services

Aadhaar Enrolment

Printing of Election Cards

SignDomainsTM is India's first ICANN Accredited domain registrar which offers on-linedomain registration of top level domains (TLD) including .com .net .org .info .biz .inetc. to name a few. The Company has tied up with various top level TLDs and offer theseTLDs to our clients through its network of over 500 Re-sellers as well as directly by theCompany.

Your Company is catering to a client base of over 6500 clients through its on-linepresence and secure payment gateway. SignDomainsTM has several corporates large portalsresellers and end-users as its clientele.

Your Company also offers web-hosting solutions on MPS dedicated servers located atserver farms and data centres located in US. Presently your company is hosting around 250websites which includes websites of corporates individuals corporations firms etc.

Value added services like SMS payment gateways messaging e-identity managemente-commerce are available for corporate clients and other businesses.

Your Company was engaged by CSC e-Governance Services India Ltd. a Central Governmentorganization for providing support for the implementation of the Election project in thestate of Gujrat. We were also engaged by CSC e-Governance Services India Ltd. for printingof Election Cards. Currently the contract with UIDAI had not been renewed but yourcompany is still trading on EPIC card.

During the year under review the company had generated revenue of Rs. 50.06 lacs thebreakup of which is as under:

Web Hosting Rs. 3.52 Lacs
Domain Registration which includes exports of Rs. 1.74 lacs Rs. 32.47 Lacs
Software Development Rs. 10.00 Lacs
Server Management Charges Rs. 2.30 Lacs
SMS Service Charges Sale Rs. 1.26 lacs
UID Aadhar Generation & Service revenue Rs. 0.51 Lacs

Telecommunication through web portal comprising of DTHPostpaid prepaid mobile recharge.

The portal was developed by the company in order to capitalize on thetelecom enabled services market in India. This retail platform offered a host of telecomenabled services to customers ranging from prepaid mobile top-up post-paid mobile billpayment DTH recharge landline bill payments data-card recharge / payments bulk SMSmobile application and software application. Your company had reaped fruits from theportal till last year however with stiff competition not only from the service providerthemselves but also from various other e-commerce platform vary low margins long creditdays are some of the constraints with which the company was operating which led to declinein revenues. During the year under review the revenues generated from Top up Air Time wasRs. 1638.82 Lacs.

As the numbers indicate the performance of Your Company is far from satisfactory whichis basically due to stiff competition not only from organised sector but from Un-organizedsector as well coupled with low margins can't maintain stock due to launch of new andimproved products at low prices; consequently the products becoming obsolete and sold atlow prices resulting into loss purchase of products and services on cash and selling thesame on credit. Inspite of above factors your company is aggressively working onexploring new areas in the above sectors and increase its market share consequentlyincreasing the stake holders worth.

During the fiscal year 2018-19 the revenues from operations (standalone basis)aggregated to Rs. 1700.39 lacs (Previous year - Rs. 7705.11 lacs) registering a decline inrevenues from operations by Rs. 6004.72 lacs (decline by 77.93%). The revenues fromoperations (Consolidated basis) aggregated to Rs. 1700.39 lacs (Previous year - Rs.7776.73 Lacs) registering a decline in revenues from operations by Rs. 6076.34 lacs (adecline in revenues by 78.14%).

The Company on standalone basis has suffered a loss before tax of Rs. 534.76 Lacs andloss after tax (including other comprehensive income) of Rs. 868.54 Lacs. TheConsolidated loss before tax stands at Rs. 535.08 lacs and loss after tax (including othercomprehensive income) of Rs. 868.86 lacs.

The losses in the company are attributable to decline in business as well as due toincrease in Depreciation and Amortisation expenses. The Depreciation and amortizationexpenses increased by Rs. 18960608/- during the year under review which is 116.65% ofthe depreciation charged during the previous financial year.

The Company is struggling to cope up with the tough Competition not only from theexisting IT companies but also from small traders flooding the already saturated IT &ITeS Segment who are providing products at very low margins. The company is also facingtough competition from the players in the unorganized sector low margins and high credit.The management is of the view that with better utilization of resources operations of thecompany will improve. The Company is also exploring other avenues of increasing its marketshare consequently increasing the stakeholders value.

Though the IT Solutions & Products segment has been underperforming which ismainly due to tough competition low margins and long credit period yet your company istaking stern steps to increase its market share in IT Solution & Products segment andis optimistic of a steady growth rate in this sector in the coming years.

Majority of the revenues of the company are from the telecommunication segment whichin the recent past had been facing tough competition from the service provider as well asvarious e-commerce sites which have ventured into B2B2C based multipurpose transactionplatform VAS and bill payment. The margins are very low in mobile and DTH rechargehowever your company is constantly trying to increase the margins by providing otherproducts like mobile applications VAS games etc. The Company is also exploring toventure into exporting mobile phones and has started exporting mobile phones thus notonly generating revenues for the company also generating valuable foreign currency forthe country.


The segment wise revenues and profits / (loss) are tabulated hereunder:

Amount (Rs.Rs. in lacs)

Segment Standalone Consolidated
2018-19 2017-18 2018-19 2017-18
IT Solutions & Products 11.52 196.55 11.52 196.55
IT Enabled Services 50.05 50.14 50.05 50.14
Telecommunication 1638.82 7458.43 1638.82 7530.04
Total 1700.39 7705.12 1700.39 7776.73
Segment results - Profit / (loss) (before Interest & Tax)
IT Solutions & Products (4.36) (3.24) (4.36) (3.24)
IT Enabled Services (26.27) 4.13 (26.27) 4.13
Telecommunication (88.72) (186.41) (88.72) (186.80)
Total (119.35) (185.52) (119.35) (185.91)
Less: Interest 59.99 321.17 59.99 321.17
Less: Other un-allocable 367.92 179.36 367.92 179.35
Expenditure net off.
Add: Un-allocable Income 12.49 685.87 12.49 685.87
Profit before Tax (534.77) (0.18) (534.77) (0.56)

The decline in the business of the Company is continuing which is mainly due to stiffcompetition both from the organised sector as well as unorganized sector low marginslong credit periods purchase of stock in cash and sale on credit; number of mobileapplications for making long distance calls including video calls various e-commercesites which are providing similar / same services with lucrative schemes; etc. Though allthe segments in which your company is operating are under performing however the companyis exploring to venture into newer areas within the above segments to increase itsrevenues and consequently increase in the stakeholders value. Your company is optimisticthat the steps that it is taking will eventually yield better results in the times tocome. Your company has already ventured into exporting mobile phones and has startedgenerating revenues for the company and also generating valuable foreign currency for thecountry.

To focus itself in its existing areas of operations the company had decided to sellits stake in its subsidiaries however the Board of Directors had deferred its decisionto sell due slackness in the area of operation in which these subsidiaries are. Things areimproving and hence the Board of Directors of the Company has once again proposed to sellits stake in its subsidiaries to enable it to focus on its core business i.e. Developmentof Enterprise Software; Domain Registration & Web-hosting and Telecommunication.

Your Company is optimistic and expects to generate revenues in the times to come.

During the year under review M/s. M.K. Aggarwal & Co. Chartered AccountantsForensic Auditors appointed by National Stock Exchange of India Limited had submittedtheir report to the Exchange. The report though contains certain observations by the saidForensic Auditors however are not major. Your company has submitted its response to theobservations made by the Forensic Auditors to National Stock Exchange of India Limited andawaiting the response from the National Stock Exchange of India Limited.

There are no material changes or commitments affecting the financial position of theCompany between the end of the financial year and to the date of the report.

In summary despite various limitation and adversaries which your company is facingdue to which the revenues had declined yet your company is exploring exporting mobilephones and also exploring newer avenues of business to increase its market shareconsequently increasing the stakeholders value.


Presently your company has three (3) wholly owned foreign subsidiaries namely M/s.Axis Convergence Inc incorporated in Mauritius; Greenwire Network Limited a companyincorporated under the laws of Hong Kong; and Opentech Thai Network Specialists Co. Ltd.incorporated under the laws of Thailand. In the AGM held on 29th September 2018 themembers on the recommendation of the Board of Directors had approved dis-investment inthese wholly owned subsidiaries as it wanted to concentrate itself in its existingbusiness. Your Company had deferred its decision to sell its stake as the marketconditions were not conducive for such sale. The Board of Directors of your company are ofthe opinion that the market conditions are expected to improve hence has once again soughtapproval from the shareholders for sale of stake in these subsidiaries.

The main business of the subsidiary companies is sale & purchase of telecomservices viz. International Voice minutes and promotional SMS pack. The work is online andthe ground work is done by the agents / companies in their respective country. Further themanagement of the work is wholly software driven like SMS gateways and soft switches forvoice.

Though there has not been any material change in the nature of the business of thesubsidiaries yet during the year under review these subsidiary companies have notcontributed to the consolidated revenues of the company on account to various factors someof which have already been mentioned above.

The Board of Directors of your company regularly reviews the affairs of thesubsidiaries. The performance and financial position of the subsidiaries included in theconsolidated financial statement is provided in accordance with the provisions of section129(3) read with Rule 5 of the Companies (Accounts) Rules 2014 and contains the salientfeatures of the financial statement of the company's subsidiaries in form AOC-1 in "Annexure- A" to this report.

The Consolidated Financial Statements have been prepared in accordance with IndianAccounting Standards (IND AS 110) issued by the "The Institute of CharteredAccountants of India" and shown the financial resources assets liabilities incomeprofits and other details of your company and its subsidiaries as a single entity afterelimination of minority interest.

In accordance with section 136 of the Companies Act 2013 Audited Financial Statementsincluding the consolidated financial statements and related information of the Company andAudited Accounts of each of its subsidiaries are available on our These documents will also be available for inspection till the date ofthe AGM during business hours at our registered office in New Delhi.


William R. Tracey in "The Human Resources Glossary" defines Human Resourcesas: "The people that staff and operate an organization" as contrasted with thefinancial and material resources of an organization.

A human resource is a single person or employee within your organization. Humanresources refer to all of the people entities employ.

Human Resources is also the function in an organization that deals with the people andissues related to people such as compensation and benefits recruiting and hiringemployees on boarding employees performance management training and organizationdevelopment and culture.

At MPS we believe that while Technology can enable processes but it is the People whoactually make things happen. We also believe that people are an organization's mostimportant resource. People are an organisation's most significant asset. In a journey ofdelivering tangible business value to stakeholders Associates are envisioned as astrategic differentiator for the Company.

Your Company promotes an empowered and collaborative work environment where leadersstay engaged with the Associates and encourage them to challenge conventional thinking.Our employees are our biggest assets. To meet the evolving need of our clients ourpriority is to attract and engage the best talent in the right locations with the rightskills.

Your Company is committed to providing a comprehensive employment experience toAssociates with the flexibility to balance both professional and personal commitments.During their tenure at the Company employees are motivated through various skilldevelopment programs. We create effective dialogue through our communication channels toensure that feedback reach the relevant team including leadership. Your Company investsubstantially in employee engagement to motivate employees and encourage socialcommunication and collaboration. Your Company continuously invests in attractionretention and development of talent on an ongoing basis. Your Company thrust is on thepromotion of talent internally through job rotation and job enlargement.


The Board of Directors of the Company consists of four members out of which two areIndependent Directors which includes a woman director. The composition of the Boardcomprise of a Managing Director who is promoter of the company also; one Non-independentnon-executive director; and two Independent Directors.

Mr. Rachit Garg retires by rotation and being eligible offers himself forre-appointment. A resolution seeking shareholders' approval for his re-appointment formspart of the Notice.

Mr. Manoj Kumar Jain was appointed as an independent director at the twenty fifthAnnual General Meeting (AGM) held on 30th day of December 2014 for a period of fiveyears. Based on the recommendation of the Nomination and Remuneration Committee hisre-appointment for a second term of five years is proposed at the ensuing AGM for theapproval of the Members by way of Ordinary Resolution.

Pursuant to the provisions of Section 149 of the Act the independent directors havesubmitted declarations that each of them meet the criteria of independence as provided inSection 149(6) of the Act along with Rules framed thereunder and Regulation 16(1)(b) ofthe Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 ("SEBI Listing Regulations"). There has been nochange in the circumstances affecting their status as independent directors of theCompany.

During the year under review the non-executive directors of the Company had nopecuniary relationship or transactions with the Company. No sitting fees commission hasbeen paid by the company to the Non-executive Director of the Company except reimbursementof expenses incurred by them for the purpose of attending meetings of the Board/Committeeof the Company.

Pursuant to the provisions of Section 203 of the Act the Key Managerial Personnel ofthe Company as on March 31 2019 are: Mr. Peeyush Kumar Aggarwal- Managing Director Mr.Sanjay Sharma - Chief Financial Officer Miss. Prachi Sharma - Company Secretary.

The Policy on Director's appointment and remuneration including criteria fordetermining qualifications positive attributes independence of Director and alsoremuneration for key managerial personnel and other employees forms part of the CorporateGovernance Report of this Annual Report. During the year Performance Evaluation ofIndependent Directors and other Board Members as well as committees of the Board was donein terms of the Act and Regulations.


As on March 31 2019 the Board had five committees namely: the audit committee thenomination & remuneration committee the stakeholders' relationship committeeCorporate Social Responsibility and Risk Management Committee. All Committees consists ofIndependent Directors. A detailed note on the composition of the Board and its committeesis provided in the Corporate Governance Report section of this Annual Report.


The Board of Directors has carried out an annual evaluation of its own performanceboard committees and individual directors pursuant to the provisions of the Act and SEBIListing Regulations. 2015.

The performance of the board was evaluated by the board after seeking inputs from allthe directors on the basis of criteria such as the board composition and structureeffectiveness of board processes information and functioning etc.

The performance of the committees was evaluated by the board after seeking inputs fromthe committee members on the basis of criteria such as the composition of committeeseffectiveness of committee meetings etc.

In a separate meeting of independent directors performance of non-independentdirectors the board as a whole and the Chairman of the Company was evaluated taking intoaccount the views of executive directors and nonexecutive directors.

The Board and the Nomination and Remuneration Committee reviewed the performance ofindividual directors on the basis of criteria such as the contribution of the individualdirector to the board and committee meetings like preparedness on the issues to bediscussed meaningful and constructive contribution and inputs in meetings etc.

In the board meeting that followed the meeting of the independent directors and meetingof Nomination and Remuneration Committee the performance of the board its committeesand individual directors was also discussed.

Performance evaluation of independent directors was done by the entire board excludingthe independent director being evaluated.


During the year under review neither the statutory auditors nor the secretarialauditor has reported to the audit committee under Section 143 (12) of the Companies Act2013 any instances of fraud committed against the Company by its officers or employeesthe details of which would need to be mentioned in the Board Report's.


The statement containing particulars of employees as required under section 197of theCompanies Act 2013 read with Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 forms part of this report. However as per the provisions ofSection 136 of the Companies Act 2013 the reports and accounts are being sent to all themembers of the Company and others entitled thereto excluding the aforesaid information.Any member interested in obtaining such particulars may write to the Company Secretary atthe Registered Office of the Company. The said information shall also be made availablefor inspection at the registered office of the Company during working hours.


The Company recognizes and embraces the importance of a diverse board in its success.We believe that a truly diverse board will leverage differences in thought perspectiveknowledge skill regional and industry experience cultural and geographical backgroundage ethnicity race and gender which will help us retain our competitive advantage. TheBoard has adopted the Board Diversity Policy which sets out the approach to diversity ofthe Board of Directors. The Board Diversity Policy is available on our website at


The policy of the Company on directors' appointment and remuneration includingcriteria for determining qualifications positive attributes independence of a Directorand other matters provided under sub-section (3) of Section 178 of the Companies Act2013 is available on our website at

There has been no change in the policy since last fiscal.

None of the directors of the Company received any remuneration or commission fromSubsidiary Companies of your Company.

The details of remuneration paid to the Directors including Executive Directordesignated as Managing Director of the Company are given in Form MGT-9 forming part of theDirectors Report.


The board met 7 times during the financial year the details of which are given in theCorporate Governance Report that forms part of the Annual Report. The intervening gapbetween any two meetings was within the period prescribed by the Companies Act 2013.

The details pertaining to the composition of the Board and that of its committees andsuch other details as required to be provided under Companies Act 2013 are included inthe Corporate Governance Report which form part of Annual report.


Independent Directors of the Company met on May 30 2018 to review the performance ofnon-independent directors the Board as a whole and the Chairman of the Company wasevaluated taking into account the views of Executive Directors and Non-ExecutiveDirectors. The same was discussed in the board meeting that followed the meeting of theIndependent Directors at which the performance of the Board its committees andindividual directors was also discussed. The Independent Directors in their separatemeeting also assessed the quality quantity and timeliness of flow of information betweenthe Company management and the Board that is necessary for the Board to effectively andreasonably perform their duties.

From time to time familiarization program are arranged by the Company for IndependentDirectors with regard to their roles rights responsibilities with the Company thenature of the industry in which the Company operates and business model of the Company andas and when the familiarization program are conducted the same are displayed underInvestors Zone on the company's website


There are no material changes affecting the Financial Position of the Company whichhave occurred between the end of the Financial Year of the Company to which the FinancialStatement relate and the date of the Report.


The financial statements are prepared in accordance with Indian Accounting Standards(Ind AS). The Ind AS are prescribed under Section 133 of the Companies Act 2013(‘the Act') read with Rule 3 of the Companies (Indian Accounting Standards) Rules2015 and Companies (Indian Accounting Standards) Amendment Rules 2016.The Company hasadopted all the Ind AS standards and the adoption was carried out in accordance withapplicable transition guidance. Accounting policies have been consistently applied exceptwhere a newly issued accounting standard is initially adopted or a revision to an existingaccounting standard requires a change in the accounting policy hitherto in use.

Pursuant to the requirement clause (c) of sub-section (3) of Section 134 of theCompanies Act 2013 your Directors confirm that:

a) in the preparation of annual accounts the applicable accounting standard had beenfollowed along with proper explanation relating to material departures;

b) the Directors had selected such accounting policies are consistently applied andreasonable made judgment and estimates that are reasonable and prudent so as to give atrue and fair view of the state of affairs of the Company as at the end of the financialyear and of the 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 in the case of a listed company had laid down internalfinancial controls to be followed by the company and that such internal financial controlsare adequate and were operating effectively;

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.

Based on the framework of internal financial controls and compliance systemsestablished and maintained by the company work performed by the Internal statutory andsecretarial auditors and the reviews performed by management and the relevant boardcommittees including the audit committee the board is of the opinion that the Company'sinternal financial controls were adequate and effective during the financial year 2018-19.


The details in respect of internal financial control and their adequacy are included inthe Management Discussion and Analysis which is a part of this report.


A. Statutory Auditor

At the 29th Annual General Meeting held on 29th September 2018 the members approvedappointment of M/s. Nemani Garg Agarwal & Co. Chartered Accountants (FirmRegistration No. 010192N were appointed as Statutory Auditors of the Company from to holdoffice to hold office for a period of five years from the conclusion of that SGM till theconclusion of the AGM to be held in the 2023 subject to ratification of their appointmentby Members at every AGM if so required under the Act. The requirement to place the matterrelating to appointment of auditors for ratification by Members at every AGM has been doneaway by the Companies (Amendment) Act 2017 with effect from May 7 2018. Accordingly noresolution is being proposed for ratification of appointment of statutory auditors at theensuing AGM and a note in respect of same has been included in the Notice for this AGM.


The observations made in the Auditors' Report are as under:

I. In the following items shown as intangible Assets / inventory there has been noprogress (a) Capital work-in-progress - Rs. 56 Crores (Software development) (b) Softwarerights - Rs. 36 crores (c) Opening Stock (Source Codes) - Rs. 62 Crores

II. Investment in subsidiaries Rs. 62 Crores - There are no operations in theseoverseas subsidiaries and no audit has been done and no updated information has beenreceived

III. The Company has shown in the balance sheet bank balances in BancoEfisa (LisbonPortugal) amounting to Rs. 347892163/- (USD 8883210.75) which the bank has adjustedand the matter is in the court of law. Consequently the bank balances shown in balancesheetis Overstated by Rs. 347892163/-

IV. The Company has increased its Authorized Capital from Rs. 52.45 Crores to Rs.377.50 crores during the period of FY-2010-11 to FY 2012-13 RoC fees of Rs. 4.88 crorestowards the same stands payable under the head "Other Current Liabilities" inthe IND AS Financial Statements (refer note no. 13 of the Standalone Balance Sheet).

V. Income Tax for the Assessment year 2013-14 amounting to Rs. 20.80 lacs and interestthereon is payable.

Report of the Statutory Auditor is annexed with the Annual Report however as regardsqualifications made by the Auditors' in their report your directors state as under:

1. The Company will be able to take business benefits once adequate funds are realisedfrom other assets of the Company. Adequate measures are being taken by the Company torealise these assets.

2. The company is making all efforts to revive the business in these subsidiarieshowever the same is possible once the company has realised funds from other assets of theCompany.

3. The funds raised by the Company from GDR issue during F._Y. 2007-08 were kept infixed deposit account with Banco Efisa Lisbon Portugal as the said amount was to bedeployed in terms of INFORMATION MEMORANDUM of the GDR issue. During the F.Y. 2008-09Banco Efisa the Bank in Portugal wrongly debited an amount of USD 8883210.75 out ofthe balance lying in the Company's Account with the Bank. The Company has denied anddisputed this debit and had initiated legal action under criminal jurisprudence ofPortuguese Law. Your Company has also initiated a strong civil action for recovery of USD8883210.75 along with interest against Banco Efisa and its Holding Company whereinour Portuguese advocates confirm that the chances of recovery are very high. The suitfiled by-your company before Portuguese courts is presently at an advanced stage andpending adjudication. In case the amount is not recovered the reserves will be reduced byRs. 3478.92 Lacs.

4. The Company had increased its authorized capital during the Financial Year 2010-11to 2012-13 however necessary forms along with the fees w.r.t. increase in authorizedCapital could not be filed and paid. Meanwhile the schedule of fees was increased as perthe Companies Act 2013. However the authorized capital was increased prior to theapplicability of Companies Act 2013. The company has filed a Writ Petition bearing No.WP(C)-5199 of 2015 before the Hon'ble High Court of Delhi challenging the applicability ofprovisions prescribed under Para 3 of Table B under Registration of Offices and Fees Rules2014 which was decided vide Judgment and Order dated 15th January 2019. The Company hasfiled an SLP before the Hon'ble Supreme Court vide diary no. 18802-2019 dated 17-05-2019.Impact of additional fee for the FY 2017-18 computed as per Companies Act 1956amounting to Rs. 48.76 lacs have already been taken into effect in while computing profit/ loss for the period. However the profits will be impacted in case the companyisdirected to pay fees as per the Companies Act 2013 which would reduce the profits by Rs.391.23 lacs.

5. As regards Auditors' remarks w.r.t. Income Tax for the Assessment year 2013-14amounting to Rs. 20.80 lacs and interest thereon is payable. It is stated that yourcompany has already provided for the amount payable towards Income Tax for AY 2013-14along with interest hence this liability has no further impact on the profits / retainedearnings of the reported period of the Company.

B. Secretarial Auditor

As required under Section 204 of the Companies Act 2013 and Rules thereunder theBoard has appointed M/s. Kundan Agrawal & Associates Practicing Company Secretariesas Secretarial Auditor of the Company for the FY 2018-19.

Annual Secretarial Compliance Report & Secretarial Audit Report

SEBI Vide its circular bearing no. CIR/CFD/CMD1/27/2019 dated February 8 2019 mandatedthat all listed entities in addition to Secretarial Audit on an annual basis require acheck by the PCS on compliance of all applicable SEBI Regulations and circulars/guidelines issued thereunder.

In compliance with the said circular M/s. Kundan Agarwal & Associates CompanySecretaries the secretarial auditors of the Company to examine the compliance of allapplicable SEBI Regulations and circulars / guidelines and provide their report. TheSecretarial Auditors vide their report dated 25th May 2019 have reported that yourcompany has maintained proper records under the provisions of SEBI Regulations andCirculars / Guidelines issued thereunder except for the following:

S. No Compliance Requirement (Regulations/ circulars / guidelines including specific clause) Deviations Observations/ Remarks of the Practicing Company Secretary
1 Regulation 14 Listing Fees & Other Charges Not Paid Listing fees Payment to BSE is pending from last one year and that of NSE is pending from last three years
2 Regulation 33 (3) (a) - Financial Results alongwith Limited review report/Auditor's report Filed twice In the first instance Limited review report was not submitted along with the financial statements of the company
3 Regulation 31 Shareholding Pattern Delayed Company has delayed in filing shareholding pattern for the quarter 31st March 2018 by one day.
4 Regulation 46 Website Partial Disclosures Company has not made proper disclosures regarding maintenance of website for the year ended March 2019.
5 Regulation 44(3) - Voting Results Delayed Due to clerical delay
6 Regulation 30 Outcome of Board meeting Delayed The outcome was filed twice and the final copy was filed after the expiry of 30 minutes from the conclusion of board meeting held on 30/05/2018.

Though there has been delay in submitting certain compliances with the stock exchangeshowever there has been no non-compliance.

The Secretarial Audit Report is provided as "Annexure-B". There areobservations qualifications reservation or adverse remark or disclaimer made in theSecretarial Audit Report which is enumerated hereunder:

(a) Listing fees payment to BSE is pending from last one year and that of NSE ispending for the past more than 3 years. (b) Company has made partial disclosures regardingmaintenance of website for the year ended 31st March 2019 and the same is not updated. (c)The Company has increased its Authorized Capital from Rs. 52.45 Crores to Rs. 377.50crores during the period of FY-2010-11 to FY 2012-13 ROC fees of Rs. 3.42 crores towardsthe same stands payable under the head "Other Current Liabilities" in thefinancial statements.

(d) The Company has three foreign subsidiaries; however the company is not regular incomplying with RBI Directives issues in this regard as well as FEMA.

The Board's comments on the observations qualifications reservations or adverseremark are as under:

(a) Due to considerable decline in the business of the company coupled with the fundsthat are available with the company are being utilized for repayments of loans from Banks.Arrangements are being made to clear the dues stock exchanges soon.

(b) Pursuant to the observations made by the Secretarial Auditors the website of thecompany has been updated.

(c) As regards observations made by the Secretarial Auditor in its Secretarial AuditReport the same has been appropriately dealt with in the Board's comments on the opinionmade by the Statutory Auditors in their audit report hence the same is not being repeatedherein for the sake of brevity.

C. Internal Auditor

Pursuant to the provision of the Companies Act 2013 and Rules framed thereunder theBoard of Directors on the recommendation of the Audit Committee has appointed M/s. Sanghi& Co. Chartered Accountants as the Internal Auditor of the company for the FY2019-20.


No employee were employed throughout the Financial Year who were in receipt ofremuneration of Rs. one crore and two lakh rupees or no employee employed for a part ofthe financial year was in receipt of remuneration of eight lakh and fifty thousand rupeesper month.

The ratio of the remuneration of whole-time director and key managerial personnel (KMP)to the median of employees remuneration as per section 197(12) of the Companies Act 2013read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 forms part of the Board's Report. However as per the provisions ofSection 136 of the Companies Act 2013 the reports and accounts are being sent to all themembers of the Company and others entitled thereto excluding the aforesaid information.Any member interested in obtaining such particulars may write to the Company Secretary atthe Registered Office of the Company. The said information shall also be made availablefor inspection at the registered office of the Company during working hours.


In line with the requirements of the Companies Act 2013 and Listing Regulations yourCompany has formulated a Policy on Related Party Transactions which is also available onthe Company's website at The Policy intends toensure that proper reporting approval and disclosure processes are in place for alltransactions between the Company and Related Parties.

All Related Party Transactions are placed before the Audit Committee for review andapproval. Prior omnibus approval is obtained for Related Party Transactions which areentered in the ordinary course of business and are at Arm's Length.

All Related Party Transactions that were entered into during the financial year were onan arm's length basis. There were no materially significant related party transactionsmade by the Company with Promoters Directors Key Managerial Personnel or otherdesignated persons which may have a potential conflict with the interest of the Company atlarge.

Except Mr. Peeyush Kumar Aggarwal and M/s Omkam Global Capital Markets Private LimitedNone of the Directors have any material pecuniary relationships or transactions with theCompany except to the extent of their shareholding.

Pursuant to Section 134 (3)(h) of the Companies Act 2013 and Rules made thereunderparticulars of transactions with related parties as required under section 188(1) of theCompanies Act 2013 in the prescribed Form AOC-2 is annexed herewith as"Annexure-C."


The Company is an equal opportunity provider and consciously strives to build a workculture that promotes the dignity of all employees. As required under the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 andRules framed thereunder the Company has implemented a policy on prevention prohibitionand redressal of sexual harassment at the workplace.

The Company has zero tolerance on Sexual Harassment at workplace. During the year underreview there were no cases filed pursuant to the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013.


A separate report on Corporate Governance is provided together with a Certificate fromthe Statutory Auditors of the Company regarding Compliance of conditions of CorporateGovernance as stipulated under Listing Regulations. A Certificate of the CEO and CFO ofthe Company in terms of Listing Regulations inter-alia confirming the correctness of thefinancial statements and cash flow statements adequacy of the internal control measuresand reporting of matters to the Audit Committee also forms part of Report on CorporateGovernance.


A detailed Management Discussion and Analysis Report for the year under review asstipulated under Regulation 34 of the Listing Regulations 2015 forms part of this Report.


The Board of Directors of the Company has formed a Risk Management Committee to frameimplement and monitor the risk management plan for the Company. The Committee isresponsible for monitoring and reviewing the risk management plan and ensuring itseffectiveness. The Audit Committee has additional oversight in the area of financial risksand controls. The major risks identified by the businesses and functions aresystematically addressed through mitigating actions on a continuing basis. The developmentand implementation of risk management policy has been covered in the Management Discussionand Analysis which forms part of this report.


Loans guarantees and investments covered under Section 186 of the Companies Act 2013are disclosed in the financial statements as well as to the Notes to the financialstatements provided in this Annual Report.


Pursuant to section 135 of Companies Act 2013 Company has constituted a CSR Committeeand also in line with requirement CSR Policy is formed by the Company the details of whichare available on the website of the Company (URL: zone ). Dueto inadequacy of profit the Company had not contribute any amount towards CSR activitiesas required under the CSR Rules 2014.

The Corporate Social Responsibility Committee of the Company has formulated andrecommended to the Board a Corporate Social Responsibility Policy (CSR Policy) indicatingthe activities to be undertaken by the Company which has been approved by the Board.

The CSR Policy may be accessed on the Company's website at the link:

The company's CSR Policy intends to:

• Strive for economic development that positively impacts the society at largewith minimal resource footprint.

• Embrace responsibility for the Company's actions and encourage a positive impactthrough its activities on hunger poverty malnutrition environment communitiesstakeholders and the society.

The Composition of the CSR Committee during the Financial Year 2017-18 was:

Mr. Peeyush Kumar Aggarwal Managing Director and Promoter and Chairman of the Committee.
Mr. Manoj Kumar Jain Independent Director and Member of the Committee.
Mrs. Madhu Sharma Independent Director and Member of the Committee.

Average net profit (Loss) of the company for last three financial years: (Rs.50766889/-)

Prescribed CSR Expenditure (two per cent of the amount as in item 3 above): Since theaverage net profits for preceding 3 financial years are in negative therefore no amountthat is required to be spent by the Company as CSR expenditure.

Details of CSR spent during the financial year:

(a) Total amount to be spent for the financial year: Nil
(b) Amount unspent if any: Nil

(c) Manner in which the amount sent during the financial year is detailed below:

(1) (2) (3) (4) (5) (6) (7) (8)
S. No.

CSR Project or activity identifie d

Sector in which the Project is covered

Projects or Programs (1) Local Area or other (2) Specify the State and district where projects or programs was undertaken

Amount outlay (budget) project or programs wise

Amount spent on the projects or programs Sub-heads: Direct expenditure on projects or programs Overheads

Cumulative expenditure upto the reporting period

Amount spent direct or through implementing agency

Not Applicable since the company had suffered losses during the last three years


As per Regulation 34 of the SEBI (Listing Obligation and Disclosure Requirement)Regulations 2015 corporate governance report with auditors' certification thereon andmanagement discussion and analysis are attached and forms part of this report.

Details of familiarization programme of the independent directors are available on thewebsite of the Company (URL:

Policy on dealing with related party transactions is available on the website of theCompany (URL:

The Company has formulated and published a Whistle Blower Policy to provide VigilMechanism for employees including directors of the company to report genuine concerns. Theprovisions of this policy are in line with the provisions of the Section 177(9) of the Actand the revised Regulation 22 of the listing agreements with Stock Exchanges. (URL:

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. Theremuneration policy is also available on the company's website. (URL:


Though Your Company has not accepted any fixed deposits and as such no amount ofPrincipal or interest on deposits from public was outstanding as of the date of balancesheet yet pursuant to the provisions of Chapter V of the Act below are the detailsrelating to deposits:

S. No Particulars Amount *Rs. / Remarks
(a) Accepted during the year Nil
(b) Remained unpaid or unclaimed as at the end of the year Nil
(c) Whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so number of such cases and the total amount involved N.A since the company has not accepted any deposits
(i) at the beginning of the year Nil
(ii) maximum during the year Nil
(iii) at the end of the year Nil


The Company has complied with the provisions of the applicable Secretarial Standardsi.e. SS-1 (Secretarial Standard on meeting of the Board of Directors) and SS-2(Secretarial Standards on General Meeting).


Your Company is mainly engaged in the business of IT and IT enabled services providingsolutions to the customers. The operations of your Company are accordingly not energyintensive. However adequate measures are taken to conserve energy and ensure its optimumconsumption by using and purchasing energy-efficient equipments. Your Company is committedto follow a high standard of environmental protection and provision of a safe and healthywork place for our people customers and visitors. As energy costs comprise a very smallpart of our total expenses the financial impact of these measures is not material. Thecompany has not imported any technology during the year under review.


Your Company strives to deliver high quality services to its customers and in suchendeavor constantly invests in and undertakes research & development aimed atimproving its solutions. MPS has a dedicated business unit for Research & Developmentwhich delivers innovative solutions to clients and also fosters R&D within allbusiness units to create intellectual property in the form of re-usable componentsframeworks etc. which help drive greater productivity. The company is carrying on R andD in multiple forms but all of these are focused on better efficiency through continuousimprovement in processes systems methodologies and capabilities. Your company iscommitted to provide I.T. solutions that are innovative and continuously upgraded inkeeping with emerging technology trends by a motivated workforce that includes R and Dgroup on time; all the time; resulting in maximizing stake holder's value. We havecontinued to invest in some fundamental research involving small budget with long termperspective. In order to excel at new operations and activities MPS stress is oncontinuous innovation and research based on market requirements and customerexpectations.


Pursuant to the provisions of Section 134(3)(a) and Section 92 of the Companies Act2013 read with Rule 12 of the Companies (Management and Administration) Rules 2014 AnnualReturn of the Company as at 31st March 2019 is uploaded on the website of the Company & annexed as "Annexure-D" which forms part ofthis report.


Particulars of foreign exchange earnings and outgo are as follows:

(Rs.Rs. in lacs)
Particulars Year ended 31.03.2019 Year ended 31.03.2018
Foreign exchange earnings 1.73 0.74
Foreign exchange Outgo 18.38 16.56


The Board of Directors acknowledges their deep appreciation to our customers vendorsFinancial Institutions Business Associates Bankers and all other Stakeholders for theircontinued co-operation and support to the Company.

The Board places its special appreciation and values the trust reposed and faith shownby every shareholder of the Company.

The Board places on record its deep appreciation for the cooperation extended byAuditors of the Company. Further the Board wishes to record its deep gratitude to all themembers of MPS family for their whole hearted support. The Board is also confident thatthe employees will continue to contribute their best in the year to come.

For and on Behalf of the Board of Directors
MPS Infotecnics Limited
SD/- SD/-
Rachit Garg Peeyush Kumar Aggarwal
Director Managing Director
DIN: 07574194 DIN: 00090423
Place: New Delhi
Date: 30/05/2019