Your Directors have pleasure in presenting the 27th Annual Report on the operations ofPalco Limited together with the audited financial statements for the year ended March 312017. The financial results of the Company are as follows:
1. Financial Results
|Particulars ||2016-17 ||2015-16 |
|Net Income & Other Income ||Nil ||NIL |
|Operating expenditure ||45.23 ||23.06 |
|Operating Profit ||(45.23) ||(23.06) |
|Interest & Depreciation ||Nil ||NIL |
|Provision for taxes (Current & Deferred) ||Nil ||NIL |
|Profit/Loss after Tax (PAT) ||(45.23) ||(23.06) |
2. Review of Operations and State of Companys Affairs
The Company is not in operations since 2005 as the assets of the Company had beentaken over by Asset Reconstruction Company (India) Limited (ARCIL) under theSecuritization and Reconstruction of Financial Assets and Enforcement of Security InterestAct 2002. Since then the company is not operating and also the company does not have anyemployees and assets. The company also does not have any executive directors.
3. Dividend Fixed Deposits and General Reserves:
The company has not declared any dividend nor invited / accepted deposits from thepublic and there are No General Reserves with the Company as there were no operations inthe company.
4. Extract of the Annual Return as per 92(3) Rule 12 in form MGT 9 134(3)(a): Annexed to the Report as "Annexure A"
5. Number of Meetings of the Board: During the year ended 2016-17 the Boardof Directors met Six Times.
6. Directors Responsibility Statement:
Your Directors state that:
a) in the preparation of the annual accounts for the year ended 31st March 2017 theapplicable accounting standards read with requirements set out under Schedule III to theAct have been followed and there are no material departures from the same;
b) 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 as at 31st March 2017 and of the profitof the Company for the year ended on that date;
c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate but the Company isnon-operating effectively.
e) The directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate but the Company is not-operatingeffectively
7. Company's Policy on Directors' Appointment & Remuneration including thecriteria for determining Qualifications Positive Attributes Independence of theDirectors and others as per 178(3) :
Nomination and Remuneration Committee looks after the criteria for determiningQualifications Positive Attributes and Independence of the Directors and others as per178(3)
8. Explanation/ comments by the Board on every Qualifications ReservationsAdverse Remarks or Disclaimers made by the Statutory Auditors & the Practicing CompanySecretary in their Reports:
The Notes on financial statements referred to in the Auditors' Report areself-explanatory and do not call for any further comments. The Auditors' Report does notcontain any qualification reservation or adverse remark.
Secretarial Auditor in their Report have raised few qualifications and the followingare the measures we have taken for such qualifications
1. The Company is not in operation and not in a position to appoint Key managerialpersons in the company as required under section 203 of the Companies Act 2013 and rulesmade there under and due to which the Company could not constitute the Proper Board ofDirectors as required.
2. Due to Financial Problem and also the Company is not in operation the Company couldnot appoint the Internal Auditors
3. The Company has appointment the Women Director on 30th march 2017
4. The Company has not called the EGM for appointing the Auditor fill the casualvacancy as required under section 139(8) of the Companies Act 2013 as calling the EGM isa expensive affair and the Company do not have the funds to call the Extra OrdinaryGeneral Meeting.
5. And also the Company is not in the position to pay the Listing Fee.
9. Particulars of the Loans Guarantees Security or Investments and the purposefor which the Loan Guarantee or Security is proposed to be utilized by the recipient asper 186:
The Company has not given any loan guarantee nor made investment covered under theprovisions of section 186 of the Companies Act 2013.
10. Particulars of Contracts or Arrangements with the Related Parties along with thejustification for entering into such transactions as per 188(1) 134(3)(h)& Rule8(2):
Since there are no operations there are no contract and arrangement with relatedparties
11. Material changes & commitments if any affecting the financial position of thecompany occurred between the end of the financial year to which this financial statementsrelate and the date of the Report:
There have been no material changes and commitments if any affecting the financialposition of the Company which have occurred between the end of the financial year of theCompany to which the financial statements relate and the date of the report.
12. Conservation of energy technology absorption Research & Development andforeign exchange earnings and outgo:
The Company had no operations during the year and therefore power and fuelconsumptions are NIL.
13. Development and implementation of a Risk Management Policy including theidentification therein of the elements of risk which in the opinion of the Board maythreaten the existence of the Company:
The Company does not have any operations and there are no assets in the Company.However appropriate measures have been taken to minimize the risk to the Company.
14. Details of the policy developed and implemented on the CSR and the initiativestaken
Composition of CSR Committee:
During the Financial Year 2016-17 Company was not required to spend on CSR Activitiesas there are no operations. Therefore company do not fall under any of the category asspecified under section 135(1) of the Companies Act 2013 read with Rules made there under
15. Performance & Financial Position of the Subsidiaries/ JVs/ Associate Companies:
There are no Subsidiary Companies nor is the Company subsidiary to any company.
16. Names of the Companies which have ceased to be Subsidiaries/ JVs/ Associates: Nil
17. Change in the nature of business if any: There is no business in the Companyand further the Company is not carrying out any business activity.
18. Directors and Key Managerial Personnel
a) Appointment of Directors.
During the Financial Year the Company has appointed Mr. Venkata Reddy Kovvuri and Mrs.Bhuvaneswari Kovvuri as Additional Director on 30.03.2017.
b) Cessation of Director
During the Year under Mr. Vijay Chandra Puljal and Mr. Andi Rajender resigned asDirector w.e.f 31.03.2017.
c) Directors Retiring by rotation
d) Changes in Directorship
During the period under review there was no change in the designation/ terms ofdirectorship of any of the Directors of the Company.
e) Change in the Key Managerial Personnel.
There are no Key managerial Personnel in the Company during the financial Year21016-17.
f) Declaration given by Independent Directors
As per the requirement of Section 149 (7) of the Companies Act 2013 Mr. Venkata ReddyKovvuri as Chairman and Mrs. Bhuvaneswari Kovvuri and Mr. Maddur Rajeshwar Rao theIndependent Directors of the Company have submitted their respective declarations thatthey fulfil criteria of Independence under Section 149 of the Companies Act 2013 readwith Regulation 25 of the SEBI (Listing Obligation and Disclosure Requirements)Regulations 2015.
19. Details of the Deposits as per the Chapter V: The Company has not accepted anydeposits under the provisions of the Companies Act 2013.
20. Details of the Deposits not in compliance of requirements of Chapter V of the Act:NIL
21. Details of the Significant & Material orders passed by the Regulators/ Courts/Tribunals impacting the going concern status of Company's operations in future:
There are no such significant and material orders passed by the regulators/Courts/tribunals impacting the companies operations. However the Company is not operatingand is non going concern company.
22. Details in respect of the adequacy of Internal Financial Controls with reference tothe
Financial Statements Rule 8(5)(viii):
The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weakness in the design or operation was observed.
23. Disclosure regarding receipt of commission by a director from the holding orsubsidiary of a company in which such person is a managing or whole-time director:
None of the Directors have received any commission from any Holding or Subsidiary (TheCompany does not have holding or subsidiary Company)
24. Manner of formal annual evaluation of own performance of the board committees andindividual directors: The Company has made the annual evaluation on the performance ofthe Board Committees and Individual Directors.
25. Report on corporate governance and management discussion and analysis report
Pursuant to the Regulation 15(2) of Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 the Compliance with thecorporate governance provisions as specified in regulations 17 to 27 and 46 (2) and ParaC D and E of Schedule V are not applicable to the Company since its paid-up share capitalthough exceed Rupees 10 Crore but its net-worth does not exceed Rupees 25 Crore as on thelast day of previous financial year i.e. 31st March 2016.
Accordingly for the year under review the reports stating compliance with the Code ofCorporate Governance and the Management Discussion and Analysis have not been annexed tothis Report.
26. Nomination and Remuneration Policy: The Company has Nomination and Remuneration
Committee. The Company is not paying any remuneration to the Directors. No sitting feeis paid to directors for attending the Meetings.
27. Vigil Mechanism/Whistle Blower Policy:
Pursuant to Section 177 of the Companies Act 2013 read with Rule 7 of Companies(Meetings of Board and its Powers) Rules 2014 the Company has established a WhistleBlower Policy to deal with instance of fraud and mismanagement if any.
28. Audit Committee:
The present Audit Committee comprises of Mr. Venkata Reddy Kovvuri as Chairman and Mrs.Bhuvaneswari Kovvuri and Mr. Maddur Rajeshwar Rao are the members of the Audit Committee.The composition of the Committee is as per the requirements of the provisions of Section177 of the Companies Act 2013 and the SEBI (Listing Obligation and DisclosureRequirements) regulations. The Audit Committee continues to provide valuable advice andguidance in the areas of costing finance and internal controls.
During the year under review the Committee met Four (4) times on 28th May 2016; 13thAugust 2016; 14th November 2016 and 10th January 2017.
29. Nomination and Remuneration Committee
The Nomination and Remuneration Committee comprises of Mr. Venkata Reddy Kovvuri asChairman and Mrs. Bhuvaneswari Kovvuri and Mr. Maddur Rajeshwar Rao are the members of theNRC. The composition of the Committee is as per the requirements of the provisions ofSection 178 of the Companies Act 2013 and the SEBI (Listing Obligation and DisclosureRequirements) regulations.
During the year under review the Committee met Three (3) on 28th May 2016 30thMarch 2017 and 31st March 2017.
30. Stakeholders Relationship Committee:
A Committee of the Board designated as stakeholders relationship committee tospecifically look into the redressal of Shareholder/investor complaints and to strengtheninvestors relations. The compositions of the Committee are included in the corporateGovernance Report forming part of this report.
The Stakeholders Relationship Committee comprises of Mr. Venkata Reddy Kovvuri asChairman and Mrs. Bhuvaneswari Kovvuri and Mr. Maddur Rajeshwar Rao are the members of theSRC. The composition of the Committee is as per the requirements of the provisions ofSection 178 of the Companies Act 2013 and the SEBI (Listing Obligation and DisclosureRequirements) regulations.
During the year under review the Committee met Four (4) on 28th May 2016; 13th August2016; 14th November 2016 and 10th January 2017.
31. Statutory Auditors:
M/s Suryanarayana & Suresh. Chartered Accountants have been the statutoryauditors of the Company and also they have informed the Board that they could not continueto act as Statutory Auditors for the company and have tendered their resignation to theCompany. Due to the Casual Vacancy occurred due to the resignation of the existingAuditors of the Company the Board recommend and proposed that M/s M.N Rao &Associates Chartered Accountants be appointed as statutory auditors of the Company forthe financial year 2006-17 to 2017-28 for a. The notice convening the 27th AGM containsthe said resolution.
The Board places on record its appreciation of the services rendered by M/sSuryanarayana & Suresh.
32. Cost Auditors:
The Company is not operating since there is no requirement for the appointment of thecost audit to the Company.
33. Internal auditors
Being the Company is not in operations for past few years and has no business activitythe company has not appointed Internal Auditor for financial year 2017-18.
34. Secretarial Auditor:
The Board has appointed Ms. S.Chidambaram Practising Company Secretary to conductSecretarial Audit for the financial year 2016-17. The Secretarial Audit Report for thefinancial year ended 31st March 2017 is annexed herewith as Annexure - B. The SecretarialAudit Report contains qualification reservation or adverse remark.
35. Particulars of Employees and related disclosures
There are no employees whose details are required to be given under Section 197 of theCompanies Act 2013.
Your Directors express their gratitude to the shareholders.
| ||For Palco Limited |
| ||Sd/- |
| ||Venkata Reddy Kovvuri |
|Place: Hyderabad ||(DIN: 07778118) |
|Date: 01.09.2017 ||Director |