For the year ended 31st March 2017
The directors hereby present their 33rd Annual Report together with the auditedstatement of accounts for the year ended 31st March 2017.
1. FINANCIAL RESULTS
| || || || ||Rs. In Lacs |
| || |
| ||2016-17 ||2015-16 ||2016-17 ||2015-16 |
|Loss : For the year ||(1109.01) ||(958.17) ||(1109.06) ||(958.32) |
|Add : Balance of loss brought from last year ||(61721.47) ||(60766.93) ||(61723.36) ||(60768.68) |
|Adjustment on account of Reduction in Share Capital || ||3.64 || ||3.64 |
|Transfer to Balance Sheet ||(62832.48) ||(61721.46) ||(62832.42) ||(61723.36) |
2. DIVIDEND :
In view of the loss your Directors regret their inability to recommend any dividendfor the year under review.
3. OPERATIONS :
There was an income of Rs.41.77 (Standalone) lacs and Rs.41.89 (Consolidated) lacsarising out of dividends electricity generation from windmill and bank interest in theyear under review. There was no recovery from defaulting parties but in the current yeargood recovery is expected from defaulting client.
The case filed by the Consortium of Banks in DRT Kolkata was being contested by theCompany on the ground of maintainability and Contempt proceedings against the company andits Directors in the Board in 2005-06 was also opposed and the matter is pending. Anothercase in DRT Kolkata had been filed by UCO Bank for the funding of Mehta Transport deal;AXIS Bank and Indusind Bank for their respective Securitised loan had filed separatesuits in DRT Chennai; IFCI not being part of Consortium of Banks had filed a separate suitin DRT Kolkata for their share of loan; IFCW had filed a suit in High Court in Calcuttafor recovery of its loan. All these cases are being contested by the Company.
Being aggrieved by DRAT Order Uco Bank with other Consortium of Banks moved aproceeding under Sarfaesi Act. Company had filed a Writ Petition before Hon'ble High Courtat Calcutta and due to some deficiency in the procedure followed by UCO Bank and othersthe said Court had Ordered that no coercive steps should be taken by Bank. Bank hadappealed against this Order which is pending.
The Company had many rounds of discussions with UCO Bank and other members of theconsortium of Banks and as it appears a settlement is expected in the current year.
4. INVESTIGATION U/S 235 OF THE COMPANIES ACT 1956 :
As reported earlier Serious Fraud Investigation Office (SFIO) had completed theirinvestigation in the year 2010 in respect of a few cases and these are being contested bythe Company in court of law and follow up action in respect of them had been initiated.Supplementary investigation in respect of Securitization deal was completed by SFIO andtwo cases had been filed in court of law..
5. MISAPPROPRIATION OF COMPANY'S FUND :
As mentioned in earlier Report the criminal case filed against 2 ex-employees in theChief Metropolitan Magistrate's Court at Bankshall Street in the year 2011 by the DCDD -Kolkata Police at Lal Bazar Street on the complaint of the Company which is progressing inthe Court. Company had also filed simultaneously money suit in the Hon'ble High Court atCalcutta against those 2 ex-employees for recovery of the funds misappropriated by themwhich is in progress. One of the employees who had moved the City Civil Court at Kolkataseeking injunction against the termination of his service is pending for hearing. Companyis trying to get the case dismissed.
6. SUBSIDIARY COMPANY :
The Company has one wholly owned subsidiary Nicco Insurance Agents &Consultants Ltd. - the performance of which during the year under review forms part of theannexed consolidated Financial Statement. The subsidiary does not come under the purviewof the SEBI (Listing Obligation & Disclosure Requirements) Regulations 2015 as it isnot a Material Subsidiary as defined under regulation 16(1)(c ) of the said Regulations.
7. STATUTORY INFORMATION :
There was no employee during the year ended 31st March 2017 in respect of whom theparticulars are required to be disclosed under rules 5(2) and 5(3) of the Companies(Appointment and Remuneration) Rules 2014
Since your Company has no manufacturing activities the disclosures as required underrule 8(3)(A) & (B) of the Companies (Accounts) Rules 2014 relating to conservation ofenergy and technology absorption are not applicable to it.
The Company had no Foreign exchange earnings and outgo during the year under review.
8. EXTRACT OF ANNUAL RETURN :
Pursuant to Section 134(3)(a) read with section 92(3) of the Companies Act 2013 anextract of the Annual Return made out in the prescribed format MGT-9 is appended asAnnexure - C to this report.
9. INTERNAL FINANCIAL CONTROL AND ITS ADEQUACY :
The Company has formulated and adopted policy adequate for evaluating the relevantaspects of Internal Financial Control relating to safeguarding of its assets preventionand detection of fraud and errors the accuracy and completeness of the accounting recordsand timely preparation of reliable financial disclosures. Apart from this professionalInternal Auditors continuously monitor the efficacy of the internal control framework andtheir reports are reviewed by the Audit Committee of Directors periodically.
10. NUMBER OF MEETINGS OF THE BOARD :
A total of four meetings of the Board of Directors of the Company were held during theyear under review the details of which were stated in the annexed Corporate GovernanceReport.
11. DIRECTORS' RESPONSIBILITY STATEMENT :
Pursuant to the provisions of Section 134(5) of the Companies Act 2013 your Directorsstate that :
(a) in the preparation of the Annual Accounts for the year ended March 31 2017applicable Accounting Standards have been followed along with proper explanation relatingto material departures;
(b) the directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as on March 31 2017 and of the loss ofthe company for the year ended 31st March 2017;
(c) the directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding assets of the company and for preventing and detecting frauds and otherirregularities;
(d) the directors had prepared the accounts for the year ended March 31 2017 on agoing concern concept based on legal opinion obtained pending final outcome of the appealpreferred by the Company against cancellation of Certificate of Registration by theReserve Bank of India;
(e) the directors had relied on the contention of the Management and also on the reportof the Internal Auditors (outside firm) relating to internal financial controls both ofwhich are adequate and were operating effectively. Directors have also relied onSecretarial Audit Report.
(f) The directors had devised proper system to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
12. DECLARATION BY THE INDEPENDENT DIRECTORS :
The Company has two Independent Directors Mr. Biswajit Roy and Mrs. Aparna Deyon the Board of the Company who hold office for a fixed tenure of five years and are notliable to retire by rotation. Declarations have been received from them confirming thatthey met the criteria of independence as laid down in section 149 and Schedule IV of theCompanies Act 2013 read with regulation 25 of the SEBI (Listing Obligation and DisclosureRequirements) Regulations 2015.
13. PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS :
The Company has not made any investments nor given any loan guarantee to any person orbodies corporate during the year under review as stipulated in section 186 of theCompanies Act 2013.
14. CORPORATE SOCIAL RESPONSIBILITY :
The Company does not come under the purview of the Corporate Social Responsibility asenvisaged in section 135 of the Companies Act 2013 read with rule 9 of the Companies(Accounts) Rules 2014.
15. VIGIL MECHANISM AND WHISTLE BLOWER POLICY :
Pursuant to regulation 22 of the SEBI (Listing Obligations & DisclosureRequirements) Regulations 2015 the Company has formulated and adopted a VigilMechanism/Whistle Blower policy for directors and employees to report genuine concerns andto deal with unethical behavior actual or suspected fraud or violation of Company's codeof conduct or ethics policy aiming inter alia at providing adequate safeguards againstvictimization of directors and employees or any other person who avail the mechanism andalso providing for direct access to the chairperson of the audit committee in appropriateand exceptional cases.
16. RELATED PARTY TRANSACTIONS :
There were no materially significant related party transactions within themeaning of regulation 23 of the SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015 by the Company with the Promoters Directors Key ManagerialPersonnel or other designated persons during the year under review warranting disclosureand section 188 of the Companies Act 2013 are not attracted.
17. CORPORATE GOVERNANCE :
The Company complied with the Code of Corporate Governance as laid down in theSEBI(Listing Obligations & Disclosure Requirements) Regulations 2015 and a report onCorporate Governance for the year under review together with a certificate from Company'sAuditors confirming compliance of the Codes is annexed which forms part of the BoardReport. The certificate does not contain any adverse remarks or qualifications.
As required under Schedule V Part-II Section II(B) of the Companies Act 2013details of remuneration package etc. of Mr. Lakshmi Narain Kaul proposed as ManagingDirector are as follows :
(a) Salary : Rs. 80000/- p.m. for the full term of 3 years.
(b) Perquisites : Rs. 19375/- p.m. (consists of L.T.A. Soft furnishing Medicalreimbursement Electricity Gas and Annual Membership Fee of one Professional Institute).
(c) The appointment is for 3 years i.e. from 1st May 2017 to 30th April 2020.Appointment may be terminated before expiry of the term by either party giving to theother party 6 months' notice or by paying to the Company 6 months' salary in lieu thereof.
(d) No benefit on account of Stock Option Pension Bonus Performance Linked Incentivesare offered.
18. EVALUATION OF THE PERFORMANCE OF THE BOARD COMMITTEES
NON-INDEPENDENT AND INDEPENDENT DIRECTORS
A formal evaluation of all the directors individually and of the Board itself as awhole including functioning of various Committees was carried out by the Board as providedin the Companies Act 2013 and SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015.
The Independent Directors also at their separate meeting conducted inter alia theevaluation of the performance of the Chairman and Non-Independent directors as required inthe Companies Act 2013 and in SEBI Regulations.
19. DEPOSIT :
The Company has no unpaid/unclaimed matured deposits or interests thereon in the yearunder review.
20. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS
COURTS AND TRIBUNALS
No significant and material order has been passed against the Company by theregulators courts tribunals impacting the going concern status and Company's operationsin future.
21. DIRECTORS :
Mr. L. N. Kaul ceased to be a Director as also the Managing Director of the Companyfollowing his retirement from the services of the Company with effect from 31st March2017.
The Board desired to put on record the dedicated service rendered and valuablecontribution made by Mr. Kaul to the Company during his tenure as Managing Director of theCompany.
For a suitable successor of Mr. Kaul an advertisement was published in the Newspaperin February '17 but no suitable candidate could be identified. Finding that Mr. Kaul ismaintaining a good health and an alert mind Chairman of Nomination and RemunerationCommittee of the Board approached him and persuaded him to join as M.D. with effect from01.05.2017 for a period of 3 years which he had accepted.
Mr. D. Saila - a non-Independent director - retires by rotation at the ensuing AnnualGeneral Meeting and being eligible offered himself for reappointment.
MANAGEMENT DISCUSSION & ANALYSIS AND CORPORATE GOVERNANCE
In accordance with the requirement of the listing Agreements with the Stock Exchange areport on the Management Discussion and Analysis is attached hereto (Annexure A'). AReport on the status of Compliance of Corporate Governance norms along with thecertificate of the Auditors are also attached (Annexure B').
23. AUDITORS' & AUDITORS' REPORT :
The Auditors M/s. G. Basu & Company Chartered Accountants were appointed withyour approval at 29th Annual General Meeting (AGM) held on 27th September 2013 for thefinancial year 2013-14 for a period of one year.
The Board further reappointed M/s. G. Basu & Company for the F.Y. : 2014-152015-16 2016-17. Out of the mandatory terms of 5 years present Auditors has alreadyacted as a Statutory Auditors for 4 years in the Company.
On the recommendation of the Audit Committee and pursuant to Sec. 139 of the Act theBoard recommended the appointment of M/s. G. Basu & Co. for the remaining one year ofthe full term of five years subject to ratification of their appointment by the members atthe 33rd AGM.
The Company has received a certificate from M/s. G. Basu & Co. confirming theireligibility to be appointed as Auditors of the Company on the basis of the provisions ofSec.141 of the Act and Rules framed thereunder. They have also confirmed that they hold avalid certificate issued by the Peer Review Board of the Institute of CharteredAccountants of India as required under Regulation 33 of the SEBI (Listing Obligation andDisclosure Requirements) 2015.The proposal of their appointment has been included in theNotice convening the 33rd AGM for obtaining the approval of the Members.
The comments of the Board of Directors to the qualifications made by the Auditors inthe (a) Auditors' Report (b) Annexure to the Auditors' Report and (c) Certificate issuedon compliance of conditions of Corporate Governance all dated 29th May 2017 are givenbelow :
Comments & Clarifications to Auditors' qualifications in their Reports
Basis for qualified Opinion
Clause (a) Please refer to Note No.2.21of Notes to Financial statement in thisregard. Necessary action if any will be taken on disposal of the appeal.
Clause (b) With regard to cases initiated by SFIO for non-compliance of theOrder of CLB on repayment of fixed deposits and few other accounting violations pleaserefer to Note No.2.3(vi) explaining that the entire fixed deposit liability of the Companyhas been completely extinguished pursuant to an Order of the Hon'ble High Court atCalcutta approving a Scheme and this plea has been taken before the Chief MetropolitanMagistrate in whose court the cases are pending and being contested by the Company. .
Clause (c) & (d)- With regard to non-confirmation of the balances by certain Banksand non-charging of interests on their dues please refer to Note No. 2.23 (a) & (b)of Notes to Financial Statement fully explaining the position.
Emphasis of matter :
(i) With regard to notes no. 2.3 (iv) (a) to (d) of Notes to Financial Statement inthis regard necessary action if any will be taken on disposal of the case.
Report on other Legal and Regulatory Requirements -
Clause 2 With regard to the report on other Legal and Regulatory requirements thematters is self explanatory.
ANNEXURE-2 TO AUDITORS' REPORT :
Clause 2 (a) (b) : Since there is no live agreement for Lease and Hire Purchase dealsand the outstanding against the earlier deals have been provided for the scope forphysical verification of inventory doesn't exist and accordingly the same has not beenverified.
Clause 7 : (a)(b) As the disputes have not yet been settled the Company is not in aposition to comment further. Clause.8 : Please refer to Note No.2.23 (a) & (b) ofNotes to Financial Statement fully explaining the position. In regard to qualificationsmade under certificate issued on Corporate Governance we state :
(a) To cut cost company is not having its own Website but sending financial dataregularly to Stock Exchange in their required format for publishing on their website.
24. SECRETARIAL AUDIT :
Pursuant to section 204 of the Companies Act 2013 the Board had appointed Messrs.RasnaGoyal Practicing Company Secretary Kolkata as Secretarial Auditor to carry out theaudit of the secretarial compliances by the Company during the year under review. TheSecretarial Audit Report in Form MR-3 of the Auditor is attached forming part of the BoardReport.
25. APPRECIATION :
Your Directors wish to thank the company's stakeholders for their support.
For and on behalf of the Board of Directors Place : Kolkata
Date : 29th May 2017