TO THE MEMBERS
Your Directors have the pleasure in presenting the 31st Annual Report of theCompany together with the Audited Accounts (Standalone and Consolidated) for the financialyear ended 31st March 2021.
The financial figures for the year under review are given below:
(Rs. In Lakhs)
|PARTICULARS ||CURRENT YEAR ||PREVIOUS YEAR |
| ||2020-2021 ||2019-2020 |
|Revenue from operations ||- ||- |
|Other income ||3.14 ||0.53 |
|Profit/(Loss) before Interest Depreciation and Tax ||(303.34) ||(14.89) |
|Less : Interest & Bank charges ||(26.95) ||(24.50) |
|Profit/(Loss) ||(330.29) ||(39.39) |
|Depreciation ||- ||- |
|Profit/(Loss) before Tax ||(330.29) ||(39.39) |
|Provision for Current Tax ||0.00 ||0.00 |
|Provision for Deferred Tax ||0.00 ||-37.77 |
|Profit/(Loss) after Tax ||(330.29) ||(1.62) |
|Transfer to General Reserve ||(330.29) ||(1.62) |
|Other Comprehensive Income for the period ||- ||- |
|Basic- Earning per equity share of Rs.10/- ||(5.41) ||(0.03) |
The company has not carried on any business activity during the year under review.
FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE
The financial statements have been prepared as per the Ind-AS whereby the preferentialshare capital has been classified into debt liability and to find out the present valuethe nominal value of these preference shares has been discounted @10% being rate ofdividend payable on these shares. The dividend/interest accrued there-upon for therelevant financial year has been included and booked as "finance cost" howeversince the last year the amortization of Deferred Revenue through the Statement of Profit& Loss Account has been discontinued in order to stop booking notional "OtherIncome". The loss for the FY 2021 stands at Rs.330.29 Lakhs as compared to Rs.1.62lakhs.
The losses during the year under review is high due to the reason that the JointVenture M/s PAOS Productions has incurred heavy losses due to claiming of substantialdepreciation available to it as it was the first year of operation. However theManagement expects that the Joint Venture will earn profits in the coming years. Moreoveras according to Ind AS 28 when the Group's share of Losses in an equity- accountedinvestment equals or exceeds its interest in entity the Group should not recognize anyfurther losses unless it has incurred obligations or made payments on behalf of otherentity. Hence the company of share of loss in the Joint Venture has been booked andrecorded upto the value of its investment in joint venture i.e. Rs.286.77 Lakhs whereasthe un-recognized losses amounting to Rs.71.83 Lakhs as on 31-03-2021 will be recognizedwhen the share of Profits of the Company in M/s PAOS Productions equals the share oflosses not re-cognized.
INFORMATION ON STATE OF COMPANY'S AFFAIR
The company has not carried any commercial activity during the year under review. Ithas no labour force but employed only administrative personnel.
The company has entered into joint venture by becoming a Partner in a Partnership Firmnamely "PAOS Productions". The said Joint venture has started its commercialproduction and sales in Financial Year 20202021 and due to claiming of substantialdepreciation as available to it being new unit the joint venture had reported losses ofRs.717.20 Lakhs in which company had share of Rs.358.60 Lakhs. The Loss of Joint Ventureis due to claiming of depreciation of Rs.647.88 Lakhs during the FY 2021 by it.
Your Directors express their inability to recommend any dividend for the year.
During the year under review the Company has not accepted or renewed any depositsfalling within the purview of the Companies Act 2013 and the rules made there-underhowever the company has received and accepted money/loan only from its Managing Directornamely Mr. Sanjeev Bansal which does not fall within the definition of deposits in termsof Rule 2(1)(c) of the Companies (Acceptance of Deposits) Rule 2014 as amended. Theamount of said money/loan stands at Rs.125093900/- as on 31.03.2021. These borrowingsfrom directors are interest free and presently the exact date of their repayment is notcertain because the company is not carrying on any commercial or business activity anddoes not have any operating assets as on date to repay it hence its classification as perInd AS is not presently feasible. However these loans are financial liability and havebeen presented and disclosed under Current Borrowings.
TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND
Since no Dividend declared and paid during last year the provisions of Section 125 ofthe Companies Act 2013 does not apply.
TRANSFER TO RESERVES IN TERMS OF SECTION 134 (3) (J) OF THE COMPANIES ACT 2013
The profit/loss of the current year has been transferred to the Reserves & Surplus.
CHANGES IN EQUITY SHARE CAPITAL
There is no change in the Equity Share Capital of the company during the year underreview.
REDEEMPTION OF PREFERENCE SHARES
The company is having 450 000 10% Redeemable Non Cumulative Participative PreferenceShares of Rs.100/- each out of which 150 000 10% Redeemable Non Cumulative ParticipativePreference Shares of Rs.100/- is due for redemption on or before 30-10-2021as they wereissued on 30-10-2001. The Board of Directors in its Meeting held on 14-08-2021 haveapproved the Redemption of 150 000 10% Redeemable Non Cumulative Participative PreferenceShares of Rs.100/- out of the proceeds of fresh Equity Shares issued in the year 2018 and2020. The proceeds collected from said shares are laying as Investment in a joint venturenamely M/s PAOS Productions in which company is one of partners with 50% profit/losssharing ratio.
CHANGES IN DIRECTORS
As reported in the previous Annual Report during the year under review Mrs Meenu Uppalwas appointed as Independent Directors of the Company pursuant to Section 149 of theCompanies Act 2013 ("the Act") read with Companies (Appointment andQualification of Directors) Rules 2014 for a further period of five years which may alsobe considered as second term of five consecutive years commencing from 1st October 2020and lasting up-to 30th September 2025.
Mrs. Rama Bansal is liable to retire by rotation and being eligible offer herself forre-appointment.
PARTICULARS OF LOAN GUARANTEES AND INVESTMENTS UNDER SECTION 185
During the Financial Year 2020-2021 the Company has not given any loan or Guarantee orprovided security in connection with a loan to any other body corporate and person andalso the company has not made any investment in any other body corporate.
INDIAN ACCOUNTING STANDARDS (Ind AS)
As mandated by the Ministry of Corporate Affairs the Company has adopted IndianAccounting Standards ("Ind AS") and the Standalone and Consolidated FinancialResults for the year 2020-2021 have been prepared in accordance with Ind AS prescribedunder Section 133 of the Companies Act 2013 read with the relevant rules issued thereunder and the other recognized accounting practices and policies to the extent applicable.
During the previous annual general meeting the members have appointed M/s RakshitKhosla & Associates Chartered Accountants (FRN.017151N) Ludhiana as StatutoryAuditors of the Company to hold office from the conclusion of 30th Annual General Meetinguntil the conclusion of 35th Annual General Meeting of company subject to ratification ofthe appointment by the members at every AGM in accordance with the provisions of theCompanies Act 2013 and the Rules made there-under. The appointment of M/s Rakshit Khosla& Associates Chartered Accountants (FRN.017151N) Ludhiana as Statutory Auditorsshall be for the Statutory Audit of FY 2020-2021 to FY 2024-2025 (both inclusive).Accordingly the appointment of Rakshit Khosla & Associates Chartered Accountants(FRN.017151N) Ludhiana is being placed before the shareholders for ratification forfinancial year 2021-2022.
STATUTORY AUDIT REPORT
The Auditor's Reports on the Standalone and Consolidated Financial Statements for thefinancial year 2021 do not contain any qualification reservation or adverse remark. TheAuditor's Reports are annexed to the financial statements.
The Statutory Auditors in their report has pointed out that the Gratuity amount hasbeen worked out without going for Actuarial Valuation. The reason for not undertakingActuarial Valuation is that the company has approached LIC for conducting ActuarialValuation of Gratuity but the Ludhiana office of Life Insurance Corporation of India hasopined that as the required number is less than 10 hence they could not proceed forvaluation. There are only two employees that too KMPs in the company as on reporting dateand out of them only one is eligible for Gratuity as on reporting date i.e. 31-03-2021.
As the company is not into operation and does not carry on any manufacturing activitieshence the provisions regarding applicability of Cost Audit are not applicable to thecompany.
As required under section 204 of the Companies Act 2013 and Rules there-under theBoard has appointed M/s Rajeev Bhambri &Associates Practicing Company Secretaries asthe Secretarial Auditor and the said firm had conducted the secretarial audit for thefinancial year 2020-2021. The Secretarial Auditors' Report for the financial year 2021does not contain any qualification reservation or adverse remark. The Auditor's Report isenclosed with this report.
The Company is not in Operation so no independent internal Auditor is appointed inCompany. However the Company has adequate internal financial controls in place and thesame is operating effectively having regard to company's size and operations.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
Pursuant to Section 197(12) of the Act read with rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 every listed companyis required to disclose information related to remuneration paid during the year. Thedetailed information in this regard is annexed to this report as "AnnexureI".
RELATED PARTY TRANSACTIONS
The company has not entered into any specific contract arrangement and transactionwith any of related parties during the year under review. However during the year underreview the company had paid remuneration to the Company Secretary and Chief FinancialOfficer (KMPs) and had obtained loan from Managing Director the detail of thesetransactions is stated in the Notes to accounts to Financial Statements. However asalready reported the company has entered into Joint Venture by becoming a Partner in thefirm namely PAOS Productions wherein the other partners are promoter/persons acting inconcert of promoters of the company. However during the year under review the companyhad received only its share of loss from the said firm PAOS Productions.
The Board of Directors of company has adopted Related Party Transaction Policy and thesame is available on the link:https://drive.google.com/file/d/1AATwAepZhV96P0DKCZkE2dqph3dIMH a/view
Further all the necessary detail of transaction entered with the related parties asdefined under section 188 of the Companies Act as defined under section 2(76) of the saidAct are attached herewith in Form-AOC-2 for your information as "Annexure-II".
DETAILS AND INFORMATION AS REQUIRED UNDER SECTION 134(3) (l) OF THE COMPANIES ACT 2013
No material changes and commitments have taken place between the end of the financialyear of the Company to which balance sheet relates and date of report which affects thefinancial position of the Company.
The Company is committed to provide the best services to the shareholder/investors. M/sLink Intime India Private Limited New Delhi is working as Registrars and Share TransferAgents (RTA) of the Company for transfer dematerialization of shares and other investorrelated services. No correspondence/ enquiry from any shareholder/investor is pending withthe company for reply.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The company is not engaged in the manufacturing activities or any other commercialactivity as such your Directors express their inability to comment upon the conservationof energy technology absorption measures and there is no the foreign exchange earningsand outgo during the year under review.
EXTRACT OF ANNUAL RETURN
The extract of Annual Return in format MGT-9 for the financial year 2020-21 has beenenclosed with this report as "Annexure III".
As required under section 134 (3)(a) of the Act the Annual Return is put up on thecompany's website and can be assessed at link https://www.paosindustries.in/p/blog-page7.html
DETAILS OF SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES
The company has entered into Joint Venture by becoming a Partner in the firm namelyPAOS Productions wherein the other partners are promoter/persons acting in concert ofpromoters of the company. However the company will received only its share of profit orloss from the said firm PAOS Productions. The company does not have any subsidiary orassociate company neither company is a subsidiary of any company.
DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
There is no change in composition of Key Managerial Personnel during the year underreview. The detail of Directors and Key Managerial Personnel at close of Financial Year2021 is as per following:
|Sr.No. Name of Director/KMP ||DIN/PAN ||Designation |
|1. Mr Sanjeev Bansal ||00057485 ||Managing Director |
|2. Mrs Rama Bansal ||08156375 ||Non-Executive Director |
|3. Mrs Meenu Uppal ||07144268 ||Non-Executive Independent Director |
|4. Mr Puneet Singhania ||01551462 ||Non-Executive Independent Director |
|5. Mrs Ruchika Gulati ||ASIPA8598F ||Company Secretary |
|6. Mr Rupinder Singh ||ECDPS5143H ||Chief Financial Officer |
DECLARATION BY INDEPENDENT DIRECTORS
The Company has received the necessary declaration from each independent director inaccordance with section 149 (7) of the Companies Act 2013 that he/she meets the criteriaof independence as laid out in sub section (6) of section 149 of the Companies Act 2013.
DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNAL
No material order has been passed by any regulator/court/tribunal during the year underreview.
STATEMENT IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROL WITH REFERENCE TO THEFINANCIAL STATEMENTS
The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weaknesses in the design or operation were observed.
NUMBER OF MEETINGS
During the financial year 2020-2021 the Board of Directors met 7 (Seven) times.Further the brief detail of Meetings of Board of Directors and its Committee Meetings isgiven in corporate governance report which forms the part of Annual Report.
RISK MANAGEMENT POLICY
The Board of Directors of your Company has adopted the Risks Management Policy. Thepolicy establishes the process for the management of risk faced by the Company. The aim ofrisk management is to maximize opportunities in all activities and to minimize adversity.This policy applies to all activities and processes associated with the normal operationsof company.
The Policy is to assist the Board of Directors in fulfilling its responsibilities withregard to enterprise risk management. Further the Policy strives to assist the Board inframing implementing and monitoring the risk management plan for the Company andreviewing and guiding the risk policy. The Policy on Risks Management may be accessed athttps://drive.google.com/file/d/1zzeSJiUnQ6xDFL2ea905KGtaAiM- DfUv/view.
EVALUATION BY BOARD OF ITS OWN PERFORMANCE ITS COMMITTEE AND INDIVIDUAL DIRECTORS WITHREFERENCE TO SECTION 134 (3) (p) OF THE COMPANIES ACT 2013 AND RULE 8(4) OF THE COMPANIES(ACCOUNTS) RULES 2014
Pursuant to the above said provisions of the Companies Act 2013 the Board has carriedout an evaluation of its own performance directors individually as well as the evaluationof the Committees as per the Criteria laid down in the Nomination Remuneration Evaluationpolicy. Further the Independent directors have also reviewed the performance of theNon-Independent Directors and Board as a whole including reviewing the performance of theChairperson of the Company taken into account the views of the Executive Directors and NonExecutive Directors vide their separate meeting.
Pursuant to the provisions of 177 of the Companies Act and Regulation 18 of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 the Company hasconstituted Audit Committee with the objectives to monitor supervise and effectivemanagement of company's finance to ensure effective internal financial controls and riskmanagement systems with high level of transparency and accuracy.
The Chairman of Audit Committee is an Independent Director and all the members of theAudit Committee are non-executive directors. The composition of the Audit Committeeconsists of two Independent Directors viz. Mrs Meenu Uppal (Chairperson) & Mr. PuneetSinghania (Member) and one Non-Executive Director namely Mrs Rama Bansal. The AuditCommittee met Seven times during the year the details of which are given in the CorporateGovernance Report which forms the part of this Annual Report.
DISCLOSURE ON THE NOMINATION AND REMUNERATION POLICY OF THE COMPANY PURSUANT TO SECTION134(3) (e) AND SECTION 178(3)
Pursuant to the provisions of 178 of the Companies Act and Regulation 19 of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 the Company hasadopted Nomination & Remuneration Policy for Directors KMPs and Senior ManagementPersonnel. The said Policy is available athttps://drive.google.com/file/d/15tKXPuvnpat5AzQi23i9ixMSv2Gd3omh/view.
DISCLOSURE IN RELATION TO VIGIL MECHANISM
In pursuance of the provisions of section 177(9) & (10) of the Companies Act 2013and Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 a Vigil Mechanism for directors and employees to report genuine concerns has beenestablished. The Policy is formulated to provide opportunity to employees and directors toreport to management concerns about unethical behavior actual or suspended fraud orviolation of the Code of conduct or policy. The mechanism provides for adequate safeguardsagainst victimization of employees and directors who express their concerns and alsoprovides for direct access to Chairman/ Members of Audit Committee in exceptional cases.The policy is applicable to all employees and directors of the Company.
The policy on Vigil Mechanism and Whistle Blower Policy as approved by the Board may beaccessed on the Company's website at the linkhttps://drive.google.com/file/d/10d8lyiahEQAwka7psBYsGPHX0NvvEzhB/view.
SECRETARIAL AUDIT REPORT
Secretarial Audit Report in format MR-3 by M/s Rajeev Bhambri & Associates CompanySecretaries is annexed with the Board Report. Secretarial Audit Report is annexed herewithas "Annexure IV". There is no adverse remark in it requiringexplanation(s) by the Board. Also annexed as "Annexure-V" is thecertificate of NonDisqualification of Directors for the Financial Year ended 31stMarch 2021.
DIRECTORS RESPONSIBILTY STATEMENT
Pursuant to Section 134(5) of the Companies Act 2013 the Board of Directors of theCompany confirms that-
(a) In the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
(b) They had selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the company at the end of the financial year and of the loss ofthe company for that period;
(c) They had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
(d) They had prepared the annual accounts on going concern basis;
(e) They had laid down internal financial controls to be followed by the company andthat such internal financial controls are adequate and were operating effectively; and
(f) They had devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
MANAGEMENT DISCUSSION AND ANLYSIS REPORT
Management Discussion and Analysis Report as required under the Regulation 34 (2) (e)of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 is given inthe Annexure-VI forming part of this report.
CORPORATE GOVERNANCE REPORT
Pursuant to Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 the report on Corporate Governance together with Practicing CompanySecretary's Certificate on compliance with this regard and Managing Director's declarationin this regarding compliance of code of conduct by Board Members and Senior ManagementPersonnel is attached as Annexure-VII and forms part of this Annual Report.
Your Director state that no Disclosure or Reporting is required in respect of thefollowing items as there is no transaction on these items during the year under review.
1. Details relating to Deposits covered under Chapter V of the Act.
2. Issue of Equity Shares with Differential right as to dividend voting orotherwise.
3. Issue of shares with including sweat equity shares to employees of the Companyunder any scheme.
4. No significant or Material order were passed by the regulators or courts ortribunal which impacted the going concern status and company's operation in future yourdirector further state that during the year under review there were no case filedpursuant to Sexual Harassment of Women at workplace (Prevention Prohibition andRedressal) Act 2013.
Your Directors wish to express their grateful appreciation for the valuable support andco-operation received from sub-brokers business associates vendors bankers financialinstitutions investors stakeholders registrar and share transfer agent other businessaffiliates and media.
The Board places on record its sincere appreciation towards stakeholders for theircontinued co-operation and support to the company and look forward to the continuance ofthis supportive relationship in future.
Your Directors also places on record their deep sense of appreciation for the devotedservices of the employees during the period under review.
| ||FOR AND ON BEHALF OF THE BOARD || |
| ||Sd/- ||Sd/- |
| ||(Sanjeev Bansal) ||(Meenu Uppal) |
| ||Managing Director ||Director |
| ||DIN:00057485 ||DIN: 07144268 |
| ||662/2 Premjit Road ||B-34/2129 New Chander Ngr |
|Date: 14-08-2021 ||Gurdev Nagar Ludhiana-01 ||Ludhiana-141001 Punjab |
|Place: Ludhiana ||Punjab || |