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National General Industries Ltd.

BSE: 531651 Sector: Metals & Mining
NSE: N.A. ISIN Code: INE654H01011
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52-Week high 839.85
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P/E 285.29
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OPEN 194.00
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VOLUME 1
52-Week high 839.85
52-Week low 149.70
P/E 285.29
Mkt Cap.(Rs cr) 107
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

National General Industries Ltd. (NATLGENINDS) - Director Report

Company director report

Dear Members

Your Directors have pleasure in presenting the Thirty Fifth AnnualReport of your Company along with the Audited Statement of Accounts for the year ended 31stMarch 2021.

FINANCIAL RESULTS

The financial performance of the Company for the financial year endedon 31st March 2021 and 31st March 2020 are summarized below:-

(Amount in Rupees)

Particulars For the year ended
31-Mar-21 31-Mar-20
INCOME:
Revenue from operations 185763668 196014089
Other Income 69302485 3600803
255066153 199614892
EXPENSES:
Cost of materials consumed 176902025 171369516
Purchase of Stock-in-Trade
Changes in inventories of finished goods work-in-progress and Stock-in-Trade (5123165) 4294556
Employee benefit expense 11233873 15211640
Financial costs 1463788 2418708
Depreciation and amortization expense 4198581 5025921
Other expenses 9660793 10572766
198335894 208893106
Profit before exceptional items and tax 56730258 (9278214)
Exceptional Items - -
PROFIT BEFORE TAX 56730258 (9278214)
TAX EXPENSES:
Current tax - -
Current tax - Prior Year - (36362)
MAT Credit - -
MAT Credit - Prior Year - -
Deferred tax (1312351) (333762)
Profit for the period from continuing operations 58042609 (8908090)
PROFIT AFTER TAX 58042609 (8908090)
Other Comprehensive Income/(Loss)
(A)Items that will be reclassified to profit or loss - -
(B)Items that will not be reclassified to profit or loss 11912872 (10206549)
Income tax relating to this 1943241 2653703
Total Other Comprehensive Income/(loss) for the year 9969631 (7552846)
Total Comprehensive Income/(loss) for the year 68012240 (16460936)

RESULTS OF OPERATIONS AND STATE OF COMPANY'S AFFAIRS

The Highlights of the Company's performance for the year ended on March31 2021 are as under:

• Value of Sales and Services decreased by 5.23% to Rs. 1857.64lakhs (PY Rs. 1960.14 lakhs).

• Value of Other Income increased to Rs. 134.23 lakhs (PY Rs.36.01 lakhs) apart from Rs. 558.79 lakhs on sale of steel casting unit.

• PBDIT increased to Rs. 65.13 lakhs (PY loss of Rs. 18.33 lakhs)apart from Rs. 558.79 lakhs on sale of steel casting unit..

• PBT increased to Rs. 8.51 lakhs (PY loss of Rs. 92.78 lakhs)apart from Rs. 558.79 lakhs on sale of steel casting unit.

• Net Profit increased to Rs. 21.63 lakhs (PY loss of Rs. 89.08lakhs) apart from Rs. 558.79 lakhs on sale of steel casting unit.

BUSINESS IMPACT OF COVID - 19

FY 2020-21 started on a difficult note due to the pandemic as lockdownsacross the globe led to weakened consumption and decline in economic growth in Q1 FY2020-21. However with the synchronised monetary and fiscal policy measures the Indianand global economy witnessed revival with improving business and consumer sentimenttogether with higher demand and pricing. Infrastructure spending being one of the focusareas of governments led to strong demand for steel and other metals globally. Howeverglobal economic recovery slackened in the latter part of CY 2020 and the first quarter ofCY 2021 as several countries battled with the second wave of COVID-19 infectionsespecially the more deadly strains. With massive vaccination drives underway risks to therecovery are expected to abate and economic activity may regain momentum in the secondhalf of CY2021.

India's economic growth too moderated due to weak domesticconsumption sluggish manufacturing and subdued investments. There was a swift revival ofeconomic activity with the easing of lockdown restrictions in June 2020 and the subsequentopening up of the economy. Several high frequency economic indicators performed betterthan the initial expectations pointing to a robust recovery.

In India the steel industry experienced a weak first quarter of FY2020-21 due to the COVID-19 induced slowdown that adversely impacted consumption andspending on infrastructure. However the government implemented a series of measures torevive the economy and the RBI pitched in with calibrated monetary policies to keepinterest rates steady through the year. Together these measures helped arrest the declineand put the economy back on the growth path. Amidst the fluctuations and uncertaintiesacross the economic landscape in India and the world the Company was able to deliverstrong operational and financial performance during FY 2020-21.

CHANGE IN NATURE OF BUSINESS

There was no change in the nature of business of your company duringthe year except that Company sold off is steel casting unit located at Bhiwadi with theapproval of members of the Company.

DIVIDEND

Your Directors have not recommended dividend for the year ended 31stMarch 2021.

TRANFER TO RESERVES

The net movement in the Reserves of the Company is as under:

Particulars F.Y. 2020-21 F.Y. 2019-20
General Reserve Rs. 25000000/- Rs. Nil
Decrease in Revaluation Reserve Rs. 96288/- Rs. 96288/-
Surplus in Statement of Profit and Loss Rs. 33042609/- Rs. (8908090/-)
Other Comprehensive Income Rs. 6184776/- Rs. (7252846/-)

DEPOSITS FROM PUBLIC

During the year under review your Company did not invite / accept anyDeposits from the public under section 73 and 74 of the Companies Act 2013 read withCompanies (Acceptance of Deposits) Rules 1975.

ANNUAL RETURN

The Annual Return of the Company for the year ended on 31stMarch 2021 has been uploaded on the website of the Company. It can be accessed underInvestor Relations page at website of the Company i.e. www.modisteel.com

NUMBER OF BOARD MEETINGS & ATTENDACE OF DIRECTORS

During the Financial Year 2020-21 7 (Seven) Board Meetings were heldand the gap between two meetings did not exceed four months. The Board Meetings were heldon 02.06.2020 31.07.2020 05.09.2020 12.11.2020 23.11.2020 21.01.2021 and 12.02.2021.

The details of composition of the Board the attendance record of theDirectors at the Board Meetings held during the financial year ended on 31.03.2021 and atthe last Annual General Meeting (AGM) and the details of their other Directorships andCommittee Chairmanships and Memberships are given below:

Category Name of Director No. of Board Meeting attended Attendance at last AGM No. of Directorships in other Public Limited Companies No. of Chairmanship / Memberships of Committees in other Public Limited Companies
Executive Shri Ashok Kumar Modi 7 No - -
Shri Pawan Kumar Modi 7 Yes - -
Non-Executive Non-independent Shri Vasu Modi 7 Yes 1 -
Non-Executive Independent Shri Anirudh Vimalkumar Goenka 6 Yes - -
Shri Anantshri Gupta 5 No - -
Smt. Sanjana Bharat 5 No - -

Number of Equity Shares held by Directors as on 31st March2021 are as under:-

Name of Director Designation Nos. of Equity Shares held
Shri Ashok Kumar Modi Chairman & Managing Director 271770
Shri Pawan Kumar Modi Joint Managing Director 271770
Shri Vasu Modi Non-Executive Director 359745
Shri Anirudh Vimalkumar Goenka Independent Director -
Shri Anantshri Gupta Independent Director -
Smt. Sanjana Bharat Independent Director -

DIRECTORS & KEY MANAGERIAL PERSONNEL

The Independent Directors of the Company are:

• Mr. Anirudh Vimalkumar Goenka

• Mr. Anantshri Gupta

• Mrs. Sanjana Bharat

The Company has received the declaration under section 149(6) of theCompanies Act 2013 from the Independent Directors of the Company. In the opinion of theBoard of Directors all the Independent Directors are proficient and having expertise andacumen to shoulder the responsibilities conferred on the Independent Directors of theCompany.

In terms of Section 203 of the Act the following are designated as KeyManagerial Personnel of your Company by the Board:

• Mr. Ashok Kumar Modi Managing Director

• Mr. Pawan Kumar Modi Joint Managing Director cum ChiefFinancial Officer

• Mr. Vandana Gupta Company Secretary

In terms of section 196 of the Act on recommendation of Nomination andRemuneration Committee the Board of Directors of the Company at its meeting held on 2ndJune 2020 extended the terms of Mr. Ashok Kumar Modi Managing Director and Mr. PawanKumar Modi Joint Managing Director of the Company for five year i.e. upto on 3rdJuly 2025.

Subsequently Mr. Ashok Kumar Modi Managing Director of the Companyresigned from the Directorship of the Company w.e.f. 30th June 2021 and Mr.Manhar Modi was appointed as Additional Director designated as Non-Executive Director ofthe Company with effect from same date. The Board of Director of the Company hasrecommended his appointment as Director of the Company in the ensuing Annual GeneralMeeting.

In terms of section 152 of the Act and applicable provisions ofArticles of Association of the Company Mr. Vasu Modi Director retires by rotation and iseligible for re-appointment. The Board recommends his re-appointment as Director of theCompany.

The information as required to be disclosed under regulation 36(3) ofthe SEBI Listing Regulations 2015 in case of appointment /re-appointment of the directorsis provided in the Notice of the ensuing Annual General Meeting.

AUDITORS & AUDITORS' REPORT

A. Statutory Auditors

M/s. N. R. & Company Chartered Accountants (Firm Registration No.: 015095C) were appointed as statutory auditors of the Company from the conclusion of the31st Annual General Meeting (AGM) of the Company held on September 26 2017till the conclusion of the 36th Annual General Meeting to be held in the year2022 subject to ratification of their appointment at every AGM.

Since the requirement to place the matter relating to appointment ofStatutory Auditors for ratification by members at every Annual General Meeting is doneaway with vide The Companies (Amendment) Act 2017 (No. 1 of 2018) readwith notificationdated May 7 2018 issued by the Ministry of Corporate Affairs New Delhi no resolution isproposed for ratification of appointment of Statutory Auditors of the Company who wereappointed at the Annual General Meeting held on 26th September 2017 to hold office fromthe conclusion of said meeting till the conclusion of Annual General Meeting to be held inthe year 2022.

B. Secretarial Auditors

M/s. Deepak Bansal & Associates Company Secretaries wereappointed as Secretarial Auditors to conduct Secretarial Audit of records and documents ofthe Company for financial year 2020-21. The Secretarial Audit Report is annexed to thisReport as Annexure I and forms part of the Annual Report.

C. Cost Auditors

In terms of provision of section 148(1) of the Companies Act 2013 readwith rule 4 of the Companies (Cost Records and Audit) Rules 2014 Company was notrequired to maintain cost records for the financial year 2020-21.

D. Internal Auditors

M/s. B.R.Maheswari & Co. Chartered Accountants (FRN 001035N)were Internal Auditors of the Company for the financial year 2020-21. Your Company hasappointed M/s. B.R.Maheswari & Co. Chartered Accountants as Internal Auditors of theCompany for the financial year 2021-22.

EXPLANATIONS OR COMMENTS ON QUALIFICATION RESERVATION OR ADVERSEREMARKS:

a) By Statutory Auditors :

There are no qualifications made by the Auditors in their Report whichrequires any explanation from the Board of Directors of the Company. The Notes to Accountsreferred to in the Auditors' Report are self-explanatory and do not call for any furthercomments.

b) By Secretarial Auditors :

There are no observations of Secretarial Auditors in their Report whichrequires any explanation from the Board of Directors of the Company.

FRAUD REPORTING

Neither the Statutory Auditors nor the Secretarial Auditors havebrought to the notice of the Audit Committee or the Board of Directors or the CentralGovernment the occurrence or brewing of any fraud in the Company.

CODE OF PRACTICES AND PROCEDURES FOR FAIR DISCLOSURE OF UNPUBLISHEDPRICE SENSITIVE INFORMATION

Your Company has adopted the "Code of Practices and Procedures forFair Disclosure of Unpublished Price Sensitive Information" which inter aliaprohibits purchase or sale of securities of the Company by Directors employees and otherconnected persons while in possession of unpublished price sensitive information inrelation to the Company. The Code requires pre-clearance for dealing in the Company'sshares and prohibits the purchase or sale of Company shares by the Directors and thedesignated employees while in possession of unpublished price sensitive information inrelation to the Company and during the period when the Trading Window is closed. The Boardis responsible for implementation of the Code.

AUDIT COMMITTEE

The Audit Committee is constituted under compliance of provision ofSection 177 of the Companies Act 2013. The Broad terms of reference and power of AuditCommittee are in line with the provisions contained under SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 and the Companies Act 2013.

The role of Audit Committee inter-alia includes following:

a) Reviewing the financial reporting process which includes reviewingthe quarterly half yearly annual financial results and auditors report thereondirector's responsibility statement.

b) Reviewing changes if any in accounting policies and practices andensures compliance with legal and statutory requirements and integrity of the Company'sfinancial statements with proper disclosures of related party transactions.

c) Recommendation for appointment remuneration and terms ofappointment of auditors and approval for their payments and also reviewing and monitoringtheir independence and performance and effectiveness of audit process.

d) Evaluation of internal control systems and its effectiveness andreviewing its adequacy.

e) Reviewing internal audit and discussion with the internal auditorsof any significant findings.

f) Review the findings of any internal investigations by the internalauditors into matters where there is suspected fraud or irregularity or a failure ofinternal control systems of a material nature and reporting the matter to the board.

g) Review Whistle Blower mechanism and its effectiveness.

h) Evaluating inter-corporate loans and investments and valuation ofassets of the Company and ensuring effective risk management systems.

During the financial year 2020-21 the Audit Committee comprises of 3Non-executive Directors viz. Shri Anirudh Vimalkumar Goenka and Smt. Sanjana BharatIndependent Directors and Shri Vasu Modi Non-independent Director. Mr. Anirudh VimalkumarGoenka is the Chairman of the Audit Committee. The Members of the Audit Committee possessadequate knowledge of Accounts Audit Finance etc. The Compliance Officer of the Companyacts as the Secretary to the Audit Committee.

Four meetings of the Audit Committee were held during the financialyear 2020-21 on 31.07.2020 05.09.2020 12.11.2020 and 12.02.2021. Further the memberof the Audit Committee as at 31.03.2021 and their attendance of each member during theyear are as given below:

Sl. No. Name of the Member Category No. of Meetings Attended
1 Shri Anirudh Vimalkumar Goenka Non-Executive Independent 4
2 Smt. Sanjana Bharat Non-Executive Independent 4
3 Shri Vasu Modi Non-Executive Non-Independent 4

NOMINATION AND REMUNERATION COMMITTEE

The Nomination and Remuneration Committee (NRC) is constituted undercompliance of provision of Section 178 of the Companies Act 2013. The Broad terms ofreference and power of Nomination and Remuneration Committee are in line with theprovisions contained under SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 and the Companies Act 2013.

The role of Nomination and Remuneration Committee inter-alia includesfollowing:

a) Formulation of the criteria for determining qualifications positiveattributes and independence of a director and recommend to the board of directors a policyrelating to the remuneration of the directors key managerial personnel and otheremployees.

b) Formulation of the criteria for evaluation of performance ofindependent directors and the board of directors;

c) devising a policy on diversity of board of directors;

d) identifying persons who are qualified to become directors and whomay be appointed in senior management in accordance with the criteria laid down andrecommend to the board of directors their appointment and removal.

e) whether to extend or continue the term of appointment of theindependent director on the basis of the report of performance evaluation of independentdirectors.

During the financial year 2020-21 the Nomination and RemunerationCommittee of the Board comprises of 3 Non-executive Directors viz. Shri Anirudh VimalkumarGoenka and Smt. Sanjana Bharat Independent Directors and Shri Vasu Modi Non-independentDirector. Mr. Anirudh Vimalkumar Goenka is the Chairman of the Committee. Further themember of the NRC Committee as at 31.03.2021 and their attendance of each Member duringthe year are as given below. The Compliance Officer acts as the Secretary to theNomination and Remuneration Committee.

One meeting of the Nomination and Remuneration Committee were heldduring the financial year 2019-20 on 02.06.2020. The attendance of each Members of theCommittee is as given below:

Sl. No. Name of the Member Category No. of Meetings Attended
1 Shri Anirudh Vimalkumar Goenka Non-Executive Independent 1
2 Smt. Sanjana Bharat Non-Executive Independent 1
3 Shri Vasu Modi Non-Executive Non-Independent 1

STAKEHOLDERS RELATIONSHIP COMMITTEE

The Stakeholders Relationship Committee is constituted under complianceof provision of Section 178 of the Companies Act 2013. The Broad terms of reference andpower of Stakeholders' Relationship Committee are in line with the provisions containedunder SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and theCompanies Act 2013.

The role of Stakeholders Relationship Committee inter-alia is toresolve the grievances of the security holders of the Company including complaints relatedto transfer and transmission of shares dematerialization / rematerialisation of sharestransposition of names consolidation of shares issue of duplicate share certificatesnon-receipt of annual report and non-receipt of declared dividends if any etc.

The Stakeholders Relationship Committee comprised of 3 directors asits Member viz. Shri Anirudh Vimalkumar Goenka and Smt. Sanjana Bharat IndependentDirectors and Shri Vasu Modi Nonindependent Director. Further the member of theStakeholders Relationship as at 31.03.2020 and their attendance of each Member during theyear are as given below. The Compliance Officer acts as the Secretary to the StakeholdersRelationship Committee.

During the year Committee met four times on 31.07.2020 05.09.202012.11.2020 and 12.02.2021 and the attendance of the Members at the meeting was as follows:

Sl. No. Name of the Member Category No. of Meetings Attended
1 Shri Anirudh Vimalkumar Goenka Non-Executive Independent 4
2 Smt. Sanjana Bharat Non-Executive Independent 4
3 Shri Vasu Modi Non-Executive Non-Independent 4

The Board has designated Ms. Vandana Gupta Company Secretary of theCompany as Compliance Officer of the Company.

No. of shareholders' complaints received upto 31st March 2021 : Ni
No. of complaints not solved to the satisfaction of the shareholders : Ni
No. of pending complaints : Ni

INTERNAL FINANCIAL CONTROLS

The Company has an Internal Control System commensurate with the sizescale and complexity of its operations. To maintain its objectivity and independence theInternal Audit function reports to the Chairman of the Audit Committee and to the Chairmanand Managing Director of the Board.

The Internal Audit Department monitors and evaluates the efficacy andadequacy of internal control system in the Company its compliance with operating systemsaccounting procedures and policies at all locations of the Company. Based on the report ofinternal audit function process owners undertake corrective action in their respectiveareas and thereby strengthen the controls. Significant audit observations andrecommendations along with corrective actions thereon are presented to the Audit Committeeand the Board.

MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There have been no material changes and commitments which can affectthe financial position of the company between the end of the period under review and dateof this report.

RISK MANAGEMENT COMMITTEE

In terms of regulation 15(2) of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 compliance under regulations 21 was notapplicable to the Company during financial year 2020-21 as paid-up share capital of theCompany as on the financial year ended on 31st March 2020 is less than Rs. 10crore and net-worth of the Company is also less than Rs. 25 crore hence Risk ManagementCommittee has not been constituted.

However the Board of Directors of your Company has on recommendationof the Audit Committee framed and adopted a policy on Risk Management of the Company.Major risks identified by the businesses and functions are systematically addressedthrough mitigating actions on a continuing basis.

DETAILS OF SUBSIDIARY JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any Subsidiary Company Associate Company orJoint Venture Company. The Company is not a Subsidiary Company of any other Company.

PARTICULARS OF CONTRACTS OR ARRANGMENTS WITH RELATED PARTY

All related party transactions done by the Company during the financialyear were at arm's length and in ordinary course of business. All related partytransactions were placed in the meetings of Audit Committee and the Board of Directors fortheir necessary review and approval. During the financial year your Company has notentered into any material transaction as mentioned in the Securities Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 with any of itsrelated parties which may have potential conflict with the interest of the Company atlarge. Disclosures pursuant to Accounting Standards on related party transactions havebeen made in the note no. 26 to the Financial Statements.

PARTICULARS OF LOAN GUARANTEES SECURITIES AND INVESTMENTS

The Company has not given any loan guarantee or provided any securityunder Section 186 of the Companies Act 2013. Disclosure on details of investments madeduring the financial years which are covered under provisions of section 186 of theCompanies Act 2013 have been made in the note no. 29 to the Financial Statements.

DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORSOR COURTS OR TRIBUNAL

There are no significant material orders passed by the Regulators /Courts which would impact the going concern status of the Company and its futureoperations. There are no proceedings initiated /pending against your Company under theInsolvency and Bankruptcy Code 2016. There was no instance of one time settlement withany Bank or Financial Institution.

WHISTLE BLOWER/VIGIL MECHANISM

Your Company has an effective Vigil Mechanism system which is embeddedin its Code of Conduct to report to the management instances of unethical behaviouractual or suspected fraud or violation of the Company's code of conduct or ethics policy.The Code of Conduct of your Company serves as a guide for daily business interactionsreflecting your Company's standard for appropriate behavior and living Corporate Values.The Vigil Mechanism provides a mechanism for employees of the Company to approach theChairman of the Audit Committee of the Company.

FORMAL EVALUATION OF BOARD COMMITTEES & DIRECTORS' PERFORMANCE

Pursuant to the provisions of the Companies Act 2013 and the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 the Board has throughmutual discussions carried out an annual evaluation of its own performance the directorsindividually as well as the evaluation of the working of its Committees.

The Nomination and Remuneration Committee ("NRC") evaluatedthe performance 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 a separate meeting of independent Directors performance ofnon-independent directors performance of the board as a whole and performance of theChairman was reviewed taking into account the views of executive directors andnon-executive directors of the company.

CONSERVATION OF ENERGY TECHNOLOGLY ABSORPTION FOREIGN EXCHANGEEARNINGS AND OUTGO

Information in accordance with the provisions of Section 134 (3) (m) ofthe Companies Act 2013 read with Rule 8 of Companies (Accounts) Rules 2014 regardingconservation of energy technology absorption and foreign exchange earnings and outgo forthe year ended 31st March 2021 is annexed to this report as Annexure II andforms part of this report.

CORPORATE GOVERNANCE

In terms of provision of regulation 15(2) of SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 compliance with the Corporate Governanceprovisions as specified under regulations 17 18 19 20 21 22 23 24 25 26 27 andclause (b) to (i) of sub-regulation (2) of regulation 46 and para C D and E of Schedule Vwas not applicable to the Company as paid-up share capital of the Company is less than Rs.10 crore and net-worth of the Company is less than Rs. 25 crore as on the financial yearended on 31st March 2020. However in view of provision of regulation 15(3) ofSEBI (Listing Obligations and Disclosure Requirements) Regulation 2015 the Companycontinued to make compliances with the applicable provisions under the Companies Act 2013during financial year 2020-21.

Subsequently as on end date of FY 2020-21 i.e. 31st March2021 upon publication of Audited Financial Results of the Company for the year ended 31stMarch 2021 net-worth of the Company exceeds Rs. 25 crore and therefore exemption underregulation 15(2) of SEBI (LODR) Regulations 2015 stands withdrawn. In terms of provisoof said regulation Company is required to comply with the exempted regulation within sixmonths from the date of its applicability. Accordingly the Company has implementedapplicability of Corporate Governance clauses under the said regulation from quarterstarting from 1st July 2021.

MANAGEMENT DISCUSSION AND ANALYSIS

In terms of regulation 34(2)(e) and para B of Schedule V of the SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015 Management Discussion& Analysis Report is annexed to this report as Annexure III and forms part of thisAnnual Report.

PARTICULARS OF EMPLOYEES

The information required under Rule 5 (2) and (3) of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is not required asthere was no employee on the payroll of the Company receiving remuneration in excess oflimit prescribed under the said rules.

NOMINATION & REMUNERATION POLICY

The broad terms of reference of the Nomination and RemunerationCommittee ("NRC") of the Company are as under:

a) To identify suitable persons interview them if necessary andrecommend them as suitable candidates to fill up vacancies on the Board or augment theBoard and Senior Management.

b) To develop a policy to ensure the optimum composition of the Boardof Directors ensuring a mix of knowledge experience and expertise from diversified fieldsof knowledge i.e. Policy on Board Diversity. The Policy also intends to addprofessionalism and objectivity in the process of deciding Board membership.

c) To lay down criteria for the evaluation of the Board.

d) To formulate a criteria for determining qualifications positiveattributes and independence of a Director and recommend to the Board a Policy thereon.

e) To formulate criteria for evaluation of Directors.

The company has adopted a Nomination and Remuneration Policy asrecommended by "NRC" and the objective of Nomination and Remuneration Policy isto ensure rationale and objectivity in the remuneration of the Directors SeniorManagement & employees of the Company. The Policy also intends to bring in a pragmaticmethodology in screening of candidates who may be recommended to the position of Directorsand to establish effective evaluation criteria to evaluate the performance of everyDirector and the overall Board of the Company.

The Policy also serves as a guiding principle to ensure good CorporateGovernance as well as to provide sustainability to the Board of Directors of the Company

DISCLOSURE OF RATIO OF REMUNERATION OF DIRECTOR'S & KEY MANAGERIALPERSONNEL ETC.

In terms of provision of Section 197(12) of the Companies Act 2013read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 the details of the ratio of the remuneration of each director tothe median employee's remuneration and such other details as prescribed therein is annexedto this report as Annexure IV and forms part of this Annual Report.

During the financial year 2020-21 the company did not pay anyremuneration to the Managing Director and other directors of the company.

CORPORATE SOCIAL RESPONSIBILITIES

The provisions of section 135 of the Companies Act 2013 were notapplicable on the Company for the FY 2020-21 as your Company did not meet any of theapplicability criteria as specified under Companies (Corporate Social ResponsibilityPolicy) Rules 2014.

DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION & REDRESSAL) ACT 2013

In accordance with the provision of The Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013 the Company has adopted apolicy for prevention of Sexual Harassment of Women at workplace and has set up Committeefor implementation of said policy. Hence the company has complied with provisionsrelating to the constitution of Internal Complaints Committee under the Sexual Harassmentof Women at Workplace (Prevention Prohibition and Redressal) Act 2013. During the yearCompany has not received any complaint of harassment.

GREEN INITIATIVE

As a responsible corporate citizen the Company welcomes and supportsthe 'Green Initiative' taken by the Ministry of Corporate Affairs Government of India(MCA) by its recent Circulars enabling electronic delivery of documents including theAnnual Report to shareholders at their e-mail address registered with the DepositoryParticipants(DPs)/Company/Registrars & Share Transfer Agents.

Shareholders who have not registered their e-mail addresses so far arerequested to register their email addresses. Those holding shares in DEMAT form canregister their e-mail address with their concerned DPs. Shareholders who hold shares inphysical form are requested to register their e-mail addresses with Skyline FinancialServices Pvt. Ltd. by sending a letter duly signed by the first/sole holder quotingdetails of Folio Number.

INTERNAL FINANCIAL CONTROLS

Based on the framework of internal financial controls and compliancesystems established and maintained by the Company work performed by the internalstatutory cost auditors secretarial auditors and external consultants and the reviewsperformed by Management and the relevant Board Committees including the Audit Committeethe Board is of the opinion that the Company's internal financial controls were adequateand effective during the financial year 2020-21.

SECRETARIAL STANDARDS

Your Company has complied with the applicable Secretarial Standardsissued by the Institute of Companies Secretaries of India during the year.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) of the Companies Act 2013 yourDirectors in respect of the Audited Annual Accounts for the year ended 31stMarch 2021 to the best of their knowledge and ability hereby state that :

(i) In the preparation of the annual accounts the applicableaccounting standards have been followed along with proper explanation relating to materialdepartures;

(ii) They have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year ended on March 31 2021 and of the profit of the Company for the year endedon that date;

(iii) They have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

(iv) They have prepared the annual accounts on a going concern basis.

(v) They have laid down internal financial controls to be followed bythe company and that such internal financial controls are adequate and were operatingeffectively.

(vi) They have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

APPRECIATION & ACKNOWLEGEMENT

Your Directors take this opportunity to express their appreciation forthe co-operation and assistance received from the Central Government the StateGovernment the Financial Institutions Banks as well as the Shareholders during the yearunder review. Your Directors also with the place on record their appreciation of thedevoted and dedicated service rendered by all the employees of your Company.

.