Mudit Finlease Ltd.
|BSE: 531919||Sector: Financials|
|NSE: N.A.||ISIN Code: INE220D01010|
|BSE 00:00 | 20 Feb||54.00||
|NSE 05:30 | 01 Jan||Mudit Finlease Ltd|
|Mkt Cap.(Rs cr)||27|
|Mkt Cap.(Rs cr)||27.49|
Mudit Finlease Ltd. (MUDITFINLEASE) - Director Report
Company director report
Your Directors present the 30th Annual Report of your Company together withthe Audited Annual Accounts for the financial year ended 31st March 2018.
During the year under review total revenue of the Company is Rs. 281.99 Lakh (Previousyear Rs. 185.93 Lakh). The Company incurred a profit of Rs. 100.53 Lakh after taxes(Previous year loss of Rs. 29.24 Lakh). Depreciation for the year was Rs. 57.99 Lakh(Previous year Rs. 54.71 Lakh).
Your Directors are positive about the Company's operations and making best efforts toimplement the cost reduction measures to the extent feasible.
The Company (registered with the Reserve Bank of India (RBI) as a Non-Banking FinancialCompany) engaged mainly in the business of providing Secured and Unsecured Loans &Advances and investing in securities both quoted and unquoted and renting & leasingof movable and immovable properties. The Company offers specialized solutions for meetingspecific liquidity requirements with technical insights into capital markets.
It is endeavor of your Company to make optimum use of its funds for ongoing setupExpansion and Working Capital requirements. Keeping in mind the aforesaid factors yourDirectors have decided not to recommend any Dividend for the year ended 31stMarch 2018.
There is no change in the Equity Share Capital of the Company during the financial yearunder review.
The Company has not accepted any fixed deposit during the year under review fallingwithin the purview of Section 73 of the Companies Act 2013 read with Companies(Acceptance of Deposits) Rules 2014. There are no deposits which are outstanding as on 31stMarch 2018.
The Company entered into Listing Agreement with BSE Limited. The Company has alreadypaid listing fees for the financial year 2018-19 to the BSE Limited.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186
The Company has not name any investment or given guarantee to any company during thefinancial year and the particulars of Loans and Advances are provided in the financialstatements (please refer the Note 10 and 12 to the financial Statements).
ADEQUACY OF INTERNAL FINANCIAL CONTROLS
The Company has adequate system of internal control to safeguard and protect from lossunauthorized use for disposition of its assets. All the transactions are probablyauthorized recorded and reported to the Management. The Company is following allapplicable accounting standards for properly maintaining the books of accounts andreporting financial statements. The Internal Auditor of the company checks and verifiesinternal control and monitors them in accordance with policy adopted by the company. TheCompany continues to ensure proper and adequate systems and procedures commensurate withits size and nature of business.
TRANSFER TO RESERVES
The Company has transferred an amount of Rs. 20.11 Lakh to the special reserve u/s45-IC out of current year's profit and also complied the applicable provisions prescribedunder the Special reserves u/s 45-IC of the RBI Act1934.
During the year under review your Company enjoyed cordial relationship with employeesat all levels. DIRECTORS AND KEY MANAGERIAL PERSONNEL
Declaration by Independent Directors
All independent directors have given declarations under section 149(7) of the CompaniesAct 2013 that they meet the criteria of independence as laid down under section 149(6) ofthe Companies Act 2013 and the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 (SEBI LODR Regulations).
Evaluation of the performance of the Board
Pursuant to the provisions of the Companies Act 2013 the Board has carried out anannual performance evaluation of its own performance the directors individually as wellas the evaluation of the working of its Audit Committee Nomination & RemunerationCommittee and Stakeholders Relationship Committee.
The Independent Directors at a separate meeting evaluated performance ofnon-independent directors performance of the Board as a whole and performance of theChairperson of the Company.
During the year under review the Board of Directors has appointed Smt. AnjaliPrajapati as an Independent Director of the Company to fill the casual vacancy caused bydeath of Sh. Sushil Chandra Mehrotra whose office shall be liable to vacation upto thedate which Sh. Sushil Chandra Mehrotra would have hold office if his office ofdirectorship had not been vacated due to his sad demise.
Pursuant to provisions of section 161(4) of the Companies Act 2013 the appointment ofSmt. Anjali Prajapati is required to be subsequently approved by members in the immediatenext general meeting. Hence the Board of Directors has recommended the approval of herappointment as an Independent Director in Notice of AGM.
In terms of Section 152 of the Companies Act 2013 Smt. Poonam Garg (DIN: 00085201)who retires by rotation at the ensuing AGM offered herself for reappointment.
None of Independent Directors will retire at the ensuing Annual General Meeting.
During the year under review the there has not been any resignation of Director(s)from the Board of the Company.
The Board of directors of the Company express their deep condolences at the untimelyand sad demise of Sh. Sushil Chandra Mehrotra Independent Director of the Company whodied on 11th January 2018. The Board of Directors place on record a deepappreciation for the valuable services rendered by Late Sh. Sushil Chandra Mehrotra whodied during his tenure as a Director of the Company.
Disclosure of Relationships Between Directors Inter-Se Shri Pavel Garg Directorand Smt. Poonam Garg Director are directly related to each other. As Smt. Poonam Garg isa wife of Mr. Pavel Garg.
Key Managerial Personnel
Shri. Chandra Kishore Aggarwal Company Secretary Smt. Lalita Katewa Chief FinancialOfficer and Sh. Pavel Garg Whole Time Director of the Company are the Key ManagerialPersonnel ("KMP") of the Company.
Directors' Responsibility Statement
In terms of Section 134 (5) of the Companies Act 2013 the directors would like tostate that:
i) In the preparation of the annual accounts for the year ended 31st March2018 the applicable accounting standards have been followed along with proper explanationrelating to material departure;
ii) The directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit or loss of the Company for the year under review;
iii) The directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
iv) The directors have prepared the annual accounts on a going concern basis;
v) The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively; and
vi) The directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such system were adequate and operating effectively.
Pecuniary Relationship or Transactions of the Non-Executive Directors anddisclosures on the Remuneration of the Directors
All pecuniary relationship or transactions of the non executive Directors vis-a-vis theCompany containing requisite information for such payments and disclosures on theremuneration of the Directors along with their shareholding are disclosed in Form MGT 9which forms part of this Report.
COMMITTEES OF THE BOARD
There are currently three committees of the Board i.e. Audit Committee Nomination andRemuneration Committee and Stakeholders Relationship Committee. The all three Committeeshas been reconstituted on as on 30th April 2018 due to sad demise of Sh.Sushil Chandra Mehrotra Independent Director of the Company as Sh. Sushil ChandraMehrotra was the member of all Committees of the Board.
The Composition of committees of the Board are as follows:
The Audit Committee of the Company reviews the reports to be submitted with the Boardof Directors with respect of auditing and accounting matters. It also supervises theCompany's financial reporting process Presently as on date of this Report the AuditCommittee Comprises of 3 directors. The Composition of the Audit Committee is as under:
Nomination and Remuneration Committee
The Board has a Nomination and Remuneration Committee. The Committee inter-alia dealswith various matters relating to:
Formulation of the criteria for determining qualifications positive attributesand independence of a director and recommend to the board of directors a policy relatingto the remuneration of the directors key managerial personnel and other employees;
Formulation of criteria for evaluation of performance of independent directorsand the board of directors;
Devising a policy on diversity of board of directors;
Identifying persons who are qualified to become directors and who may beappointed in senior management in accordance with the criteria laid down and recommend tothe board of directors their appointment and removal.
Whether to extend or continue the term of appointment of the independentdirector on the basis of the report of performance evaluation of independent directors.
Presently as on date of this Report the composition of the Nomination and RemunerationCommittee is as under:
Stakeholders Relationship Committee
The Board has a Stakeholders Relationship Committee. The Committee inter-alia dealswith various matters relating to:
Transfer/transmission of shares;
Issue of duplicate share certificates;
Investors' grievances and redressal mechanism and recommend measures to improvethe level of investor services.
Details of shares transfer/transmission approved by the Committee andShareholders'/Investors' grievances are placed at the Board Meetings from time to time.
Presently as on date of this Report the Stakeholders Relationship Committee comprisesof 3 (three) Directors.
MEETINGS OF THE BOARD AND COMMITTEES
During the year Six Board Meetings and Four Audit Committee Meetings were convened andheld. The details of which are given as under.
The intervening gap between the Meetings was within the period prescribed under theCompanies Act 2013.
There was only one meeting held of Nomination and Remuneration Committee as on 20thMarch 2018 and Stakeholders Relationship Committee as on 31st March 2018.
Policy on Directors' Appointment and Remuneration
The current policy is to have a appropriate mix of Executive and Independent directorsto maintain the independence of the board separate its function of Governance andManagement. As on 31st March 2018 the Board consists of 3 members one of whomexecutive director one is non executive director and one independent Director. The Boardperiodically evaluates the need for change in its composition and its size.
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 adopted by the Board is appended as "Annexure A" to the Board's Report.We affirm that remuneration paid to the directors is as per the terms laid out in theremuneration policy of the company.
SUBSIDIARY COMPANIES/ASSOCIATE COMPANIES/JOINT VENTURES
The Company do not have any subsidiary joint venture or associate Company hence noneed to state anything about the same.
CODE OF CONDUCT
The Board of Directors has approved a Code of Conduct which is applicable to members ofthe Board and all employees in the course of day to day business operations of thecompany. The Code has been placed on the Company's website. The Code lays down thestandard procedure of business conduct which is expected to be followed by the directorsand the designated employees in their business dealings and in particular on mattersrelating to integrity in the work place in business practices and in dealing withstakeholders.
All the Board Members and the Senior Management personnel have confirmed compliancewith the Code. VIGIL MECHANISM// WHISTLE BLOWER POLICY
In pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013a Vigil Mechanism for directors and employees to report genuine concerns has beenestablished. The Vigil Mechanism Policy has been uploaded on the website of the Company atwww.muditfinlease.com and is displayed on thewebsite of the Company at
RISK MANAGEMENT AND POLICY
Pursuant to section 134 (3) (n) of the Companies Act 2013 the Company has implementedRisk Management Policy which is available on Company's website at http://muditfinlease.com/wp-content/uploads/2017/08/Risk-Management-Policy.pdf and the Board of Directors has prepared a comprehensive framework ofrisk management for assessment of risks and to determine the responses to these risks soas to minimize their adverse impact on the organization.
PREVENTION OF INSIDER TRADING
The Company has adopted a Code of Conduct for Prevention of Insider Trading with a viewto regulate trading in securities by the Directors and certain designated employees of theCompany. The Code requires preclearance for dealing in the Company's shares and prohibitsthe purchase or sale of Company shares by the Directors and designated employees while inpossession of unpublished price sensitive information in relation to the Company andduring the period when the trading window is closed. The Board is responsible forimplementation of the Code. All Board Directors and the designated employees haveconfirmed compliance with the Code. The Code is uploaded on Company's website athttp://muditfinlease.com/wp-content/uploads/2017/08/Code-of-Conduct-of-Insider-Trading.pdf
The Company complies with all the applicable Secretarial Standards. PRUDENTIAL NORMS& DIRECTIONS OF RBI FOR NBFCS
Your company has complied with all the requirements prescribed by the Reserve Bank ofIndia and has filed the required returns.
M/s. G. K. Kedia & Co. Chartered Accountants New Delhi having Firm RegistrationNo. 013016N retires at the conclusion of the ensuing Annual General Meeting and beingeligible offer themselves for re-appointment.
Pursuant to provisions of section 204 of the Companies Act 2013 and The Companies(Appointment and
Remuneration of Managerial Personnel) Rules 2014 the company has appointed M/s VikasKumar Sharma Company Secretary to undertake the Secretarial Audit of the Company forfinancial year 2017-18. The Secretarial Audit Report is annexed herewith as "AnnexureB".
The Board of Directors of your company has appointed M/s Deep Singhal & AssociatesChartered Accountants as an internal auditors of the company and his report is reviewed bythe Audit Committee from time to time.
Explanation and Comments on Auditor's and Secretarial Audit Report
There is no qualification disclaimer reservation or adverse remark made by theStatutory Auditors in Auditors' Report.
Further there is no qualification disclaimer reservation or adverse remark made bythe Company Secretary in practice in Secretarial Audit Report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
a. Conservation of Energy & Technology Absorption: The Company being a non-bankingfinance company (NBFC) does not have any manufacturing activity. The directorstherefore have nothing to report on 'conservation of energy and technology absorption'.
b. Export Activities: There was no export activity in the Company during the year underreview. The Company has no immediate plans for export in the near future as well.
c. Foreign Exchange Earnings and Outgo: There was no Foreign Exchange earnings andoutgo during the year under review.
RELATED PARTY TRANSACTIONS
All the Related Party Transactions are entered into by the Company at arm's lengthbasis in the ordinary course of business and are in compliance with the applicableprovisions of the Act and the SEBI LODR Regulations and the Company's Policy on RelatedParty Transactions. During the financial year 2017-18 the Company did not enter into anymaterial related party transactions i.e. transactions exceeding ten percent of theconsolidated turnover as per the last audited financial statements. Accordingly thedisclosure of Related Party Transactions as required under Section 134(3) (h) of the Actin Form AOC 2 is not applicable.
The policy on Related Party Transactions as approved by the Board is displayed on thewebsite of the Company athttp://muditfinlease.com/wp-content/uploads/2015/04/Policy_on_Related_Party_Transactions.pdf
The Company has in place a Prevention of Sexual harassment policy in line with therequirements of the sexual harassment of Women at workplace (Prevention Prohibition andRedressal) Act 2013. All employees (permanent contractual temporary trainees) arecovered under this policy.
During the Year 2017-18 no complaints were received by the Company related to sexualharassment.
BUSINESS RESPONSIBILITY REPORT
Business Responsibility Report as stipulated under Regulation 34 of the SEBI LODRRegulations is not applicable to the Company. Since no initiative with respect toenvironmental social etc has been taken.
Since the Company having paid-up capital and net worth less than the thresholdprovided under Regulation 15(2) of SEBI LODR Regulations. Hence the Company need notrequired to address Reports on Corporate Governance certificate/s from either theauditors or practicing company secretaries regarding compliance of conditions of corporategovernance.
MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 with the Stock Exchanges is presented in a separate section formingpart of the Annual Report.
EXTRACT OF ANNUAL RETURN
In accordance with Section 92(3) of the Companies Act 2013 the details forming partof the extract of the Annual Return in form MGT-9 is annexed herewith as "AnnexureC".
CORPORATE SOCIAL RESPONSIBILITY
The provision of Section 135 of the Companies Act 2013 regarding Corporate SocialResponsibility shall not be applicable to companies having net worth not exceeding Rs. 500Cr or turnover not exceeding Rs. 1000 Cr or net profit not exceeding Rs. 5 Cr or moreduring any financial year as on the last date of previous financial year. In thisconnection we wish to inform you that in respect of our company as on the last auditedbalance sheet as at 31st March 2018 neither the net worth exceeds Rs. 500 Crnor turnover exceeds Rs. 1000 Cr nor net profit exceeding Rs. 5 Cr. Hence the provisionsof Companies Act 2013 regarding Corporate Social Responsibility would not be applicable.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company forms part of this report and annexed herewith as "Annexure D".In terms of Section 136 of the Act the reports and accounts are being sent to the membersand others entitled thereto including the information on employees' particulars which isavailable for inspection by the members at the Registered office of the company at allworking days except Saturdays between 11 A.M. to 01:00 P.M. up to the date of AnnualGeneral Meeting. If any member is interested in inspecting the same such member may writeto the company secretary in advance.
DISCLOSURES UNDER THE ACT
* Significant and Material Orders
There are no significant and material orders passed by the regulators or courts ortribunals impacting going concern status and company's operations in future.
* Material changes and commitments affecting the financial position of the Companyafter the close of financial year
There are no material changes and commitments affecting the financial position of theCompany which has occurred between the end of the financial year of the Company i.e. 31stMarch 2018 and the date of the Directors' Report.
* Change In The Nature of Business
There were no changes in the nature of the Business during the Financial Year ended 31stMarch 2018.
* Reporting of Frauds by Auditors
There were no frauds reported by auditors as per Section 134(3) and Section 143(12) ofthe Act.
ACKNOWLEDGMENTS AND APPRECIATION
The Directors take this opportunity to thank the Company's customers shareholdersinvestors suppliers bankers financial institutions and Central & State Governmentsfor their consistent support to the Company. The Directors also wish to place on recordtheir appreciation to employees at all levels for their hard work dedication andcommitment.
For and on behalf of the Board For Mudit Finlease Limited
ANNEXURES FORMAING PART OF DIRECTORS' REPORT
Nomination and Remuneration Policy
Pursuant to Section 178 of the Companies Act 2013 and extant provisions of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 Mudit Finlease Limited("the Company") has a Nomination and Remuneration Commettee as per the terms andconditions provided in Section 178 of the Companies Act 2013 and other applicableprovisions. As per the provisions the Company is required to frame a policy on nominationand remuneration of Directors Key Managerial Personnel (KMP) Senior Management and otheremployees of the Company.
1. Objective of the Policy
The policy is framed with the objective(s):
a) That based on the Company's size and financial position and trends and practices onremuneration prevailing in peer companies in the Industry the level and composition ofremuneration is reasonable and sufficient to attract retain and motivate directors andtalented managerial personnel of the quality required to run the Company successfully andto ensure long term sustainability and create competitive advantage.
b) That the remuneration to Directors Key Managerial Personnel (KMP) and otheremployees of the Company involves a balance between fixed and incentive pay reflectingshort and long term performance objectives appropriate to the working of the Company andits goals.
2. Constitution of the Nomination and Remuneration Committee
The Board has reconstituted the nomination and remuneration committee of the Board.This is in line with the requirements under the Companies Act 2013 ('the Act').
The Board has authority to reconstitute this committee from time to time.
3. Functions of the Nomination and Remuneration Committee
The Nomination and Remuneration Committee shall inter-alia perform the followingfunctions:
a) Identify persons who are qualified to become Directors and employees who may beappointed in key managerial position senior management in accordance with the criterialaid down recommend to the Board their appointment remuneration and removal includingsuccession planning.
b) Ensure that the Board comprises of a balanced combination of Executive Directors andNon- Executive Directors and also the Independent Directors including Board diversity.
c) Devise framework to ensure that Directors are inducted through suitablefamiliarization process along with criteria for evaluation of Independent Directors andthe Board and to provide for reward(s) linked directly to their effort performance.
d) Decide/approve details of fixed components and performance linked incentives alongwith the performance criteria.
e) Such other functions as may be decided in accordance with the Companies Act 2013and the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 asamended from time to time.
The Chairman of the Nomination and Remuneration committee could be present at theAnnual General Meeting to answer the shareholders' queries. However it would be up tothe Chairman to decide who should answer the queries.
This Policy is applicable to:
a) Directors viz. Executive Non-Executive and Independent
b) Key Managerial Personnel ("KMP")
c) Senior Management Personnel
d) Other Employees of the Company
5. Matters relating to the remuneration perquisites for the Whole-time / Executive /Managing Director Role of Committee
1. The remuneration / compensation / profit-linked commission etc. to theWhole-time/Executive/Managing Directors will be recommended by the Committee and approvedby the Board. The remuneration / compensation / profit-linked commission etc. shall be inaccordance with the percentage/slabs/conditions laid in the Companies Act 2013 and shallbe subject to the prior / post approval of the shareholders of the Company and CentralGovernment wherever required.
2. If in any financial year the Company has no profits or its profits are inadequatethe Company shall pay remuneration to its Whole Time Director(s) in accordance with theprovisions of Schedule V of the Companies Act 2013 and if it is not able to comply withsuch provisions then with the prior approval of the Central Government.
3. Increments to the Whole Time Director(s) should be within the slabs approved by theshareholders. Increments will be effective 1st April in respect of a Whole TimeDirector as well as in respect of other employees of the Company unless otherwisedecided.
The Committee may recommend to the Board with reasons recorded in writing removal ofa Director KMP or one level below KMP subject to the provisions of the Companies Act2013 and all other applicable Acts Rules and Regulations if any.
The Director KMP and one level below the KMP shall retire as per the applicableprovisions of the Regulations Act and the policy of the Company. Employment of theservices of the Director KMP Senior Management Personnel as consultants after theirretirement would be at the sole discretion of the Board.
8. Remuneration to Non-Executive / Independent Director
a) Sitting Fees
The Non-Executive Independent Directors of the Company shall be paid sitting fees asper the applicable Regulations. The quantum of sitting fees will be determined as per therecommendation of the Nomination and Remuneration Committee and approved by the Board ofDirectors of the Company.
b) Profit-linked Commission
The profit-linked Commission shall be paid within the monetary limit approved by theshareholders of the Company subject to the same not exceeding 2% of the net profits of theCompany computed as per the applicable provisions of the Regulations.
c) Stock Options
An Independent Director shall not be entitled to any stock option of the Company.
9. Remuneration to KMP Senior Management Personnel and Other Employees
The KMP Senior Management Personnel and other employees of the Company shall be paidmonthly remuneration as per the Company's HR policies and / or as may approved by theCommittee.
The Chief Executive Officer/Whole Time Director of the Company will make organization -wide annual presentation(s) before the Committee which would have requisite detailssetting out the proposed performance bonus payouts for the current financial year as wellas the proposed increments for the next financial year. The Committee shall peruse andapprove the same unless required under relevant regulations to refer the same to theBoard of Directors and/or Shareholders of the Company.
If the remuneration of KMPs or any other officer is to be specifically approved by theCommittee and/or the Board of Directors under any Regulations then such approval will beaccordingly sought. This Remuneration Policy shall apply to all future/continuingemployment/engagement(s) with the Company. In other respects the Remuneration Policyshall be of guidance for the Board. Any departure from the policy shall be recorded andreasoned in the Committee and Board meeting minutes. The Company reserves its right toamend or modify this Policy in whole or in part at any time without assigning any reasonwhatsoever.
10. Policy on Board diversity
The Board of Directors shall have the optimum combination of Directors from thedifferent areas/ fields like production Management Quality assurance finance Sales andMarketing supply Chain research and development human resources etc. or as may beconsidered appropriate.
The Board shall have atleast one Board Member who has accounting or related financialmanagement expertise and atleast three members who are financially literate.
For and on behalf of the Board For Mudit Finlease Limited