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Paul Merchants Ltd.

BSE: 539113 Sector: Financials
NSE: N.A. ISIN Code: INE291E01019
BSE 00:00 | 30 Nov 1311.95 -21.15
(-1.59%)
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1369.35

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1369.35

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NSE 05:30 | 01 Jan Paul Merchants Ltd
OPEN 1369.35
PREVIOUS CLOSE 1333.10
VOLUME 1037
52-Week high 1749.00
52-Week low 951.10
P/E 5.52
Mkt Cap.(Rs cr) 135
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 1369.35
CLOSE 1333.10
VOLUME 1037
52-Week high 1749.00
52-Week low 951.10
P/E 5.52
Mkt Cap.(Rs cr) 135
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Paul Merchants Ltd. (PAULMERCHANTS) - Director Report

Company director report

Dear Members

Your Directors have pleasure in presenting before you their 37th Annual Report togetherwith the Audited Financial Statements of the Company for the Financial year ended 31stMarch 2021.

FINANCIAL SUMMARY/HIGHLIGHTS:-

The financial summary of the Company for the year under review based on the standalonefinancial statements of the company is given below for your consideration:-

2020-21 2019-20
PARTICULARS (Amount in Rs.) (Amount in Rs.)
Gross Income 29836246925 53711702593
Profit Before Interest and Depreciation 213227087 208008609
Interest 661145 1312622
Profit after Interest before Depreciation 212565942 206695987
Provision for Depreciation 22277177 28179618
Exceptional Items 30472125 12917116
Net Profit Before Tax 159816640 165599253
Provision for Tax 32026515 34179287
Deferred Tax 1017012 12467220
Net Profit After Tax 126773112 118952746
Other Comprehensive Income/(Loss) (net of tax) 647428 -1821453
Total Comprehensive Income (net of tax)
127420545 117131293
(Transferred to Reserves and Surplus)
Balance of Surplus brought forward 3899124380 3784049087
Reserves and Surplus 4026544920 3899124380
Proposed Dividend on Equity Shares Nil Nil. Interim Dividend of Rs 20.56 Lakhs (Rs. 2/- per share) paid during the year was proposed to be confirmed as Final by the shareholders.

STATE OF COMPANY'S AFFAIRS/ BRIEF DESCRIPTION OF THE COMPANY'S WORKING

DURING THE YEAR/HIGHLIGHTS/OPERATIONS IN TERMS OF SECTION 134 (3)(i) OF THE COMPANIESACT 2013 READ WITH RULE 8(5)(I) OF THE COMPANIES (ACCOUNTS) RULES 2014

The Company operates principally in three business verticals Foreign Exchange Tours& Travels and International Money Transfer. During the year under review Grossrevenue from Foreign Exchange Services stood at Rs. 2955.08 Crores. In Tours & TravelSegment Turnover from Hotel Bookings & Packages stood at Rs. 9.15 Lakhs and Revenuefrom other activities in the said segment stood at Rs. 48.59 Lakhs. Gross revenue fromInternational Money Transfer stood at Rs. 43 Lakhs. Other operating revenues stood at Rs.5.41 crores. The Profit before tax stood at Rs. 15.98 Crores and Profit after tax stood atRs.12.68 crores after adjusting for deferred Tax. For further details kindly refer to theFinancial Statements Management Discussion & Analysis Report annexed as AnnexureD-3 and Corporate Governance Report annexed as Annexure D-9 forming part ofthis report.

COVID-19

In the month of March 2020 due to the announcement of Lockdown/Curfew in variousStates/Union Territories by the State/Union Government(s) in order to prevent and containthe spread of Covid-19 (Corona Virus) and keeping in view the safety and well being of theemployees the Company Paul Merchants Limited and its Wholly Owned Subsidiary Company PaulMerchants Finance Private Limited (‘PMFPL') had temporarily closed its RegisteredOffice and Branches across India w.e.f. 23rd March 2020. However the Company managed tokeep its treasury accounts and back office teams operational due to work from homearrangements and some part of Gold loan operations was also sustained by the Wholly OwnedSubsidiary. The spread of covid-19 and consequent closure of branches had adverselyaffected the Company's top line as well as bottom line. At that time the Company was leftwith only 20% of Forex business and Travel business was almost NIL. However in accordancewith the Guidelines/ Compliance norms issued/ suggested by the Central Government StateGovernments and local authorities from time to time the Company Paul Merchants Limitedand its Wholly Owned Subsidiary Company Paul Merchants Finance Private Limited graduallystarted opening its branches in various states and as of July 2020 full operations hadbeen started. In terms of Regulation 30 of Listing Regulations the Company duly filed itsdisclosures relating to disruption in the operations due to COVID vide its letter datedMarch 24 2020 Letter dated May 12 2020 Letter dated May 26 2020 Letter dated June24 2020 and Letter dated July 10 2020 with BSE Ltd.

ANNUAL RETURN

In terms of Section 134 (3)(a) of the Companies Act 2013 (hereinafter to be referredto as Act) the Annual Return as referred to in sub section (3) of Section 92 is availableon the weblink https://www.paulmerchants.net/paulmerchants/annual-return/

NUMBER OF MEETINGS OF BOARD

The information in terms of Section 134(3)(b) of the Act is given below:-

During the Financial year 2020-21 4 (Four) Board Meetings were held and 1 (One)Independent Directors meeting was held on 11-02-2021. The dates on which the BoardMeetings were held are 25-06-2020 18-08-2020 12-11-2020 and 11-02-2021. Further detailsas required under Part C of Schedule V to the Securities & Exchange Board of India(Listing Obligations and Disclosure

Requirements) Regulations 2015 are given in the Corporate Governance Report which isannexed as Annexure D-9 forming part of this Report.

DIRECTORS' RESPONSIBILITY STATEMENT:-

Pursuant to Section 134 (3) (c) read over with Section 134 (5) of the Companies Act2013 your Directors confirm that:-

(a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures; (b) thedirectors had selected such accounting policies and applied them consistently and madejudgments and estimates that were reasonable and prudent so as to give a true and fairview of the state of affairs of the company at the end of the financial year and of theprofit and loss of the company for that period; (c) the directors had taken proper andsufficient care for the maintenance of adequate accounting records in accordance with theprovisions of this Act for safeguarding the assets of the company and for preventing anddetecting fraud and other irregularities; (d) the directors had prepared the annualaccounts on a going concern basis; (e) the directors had laid down internal financialcontrols to be followed by the company and that such internal financial controls areadequate and were operating effectively. (f) the directors had devised proper systems toensure compliance with the provisions of all applicable laws and that such systems wereadequate and operating effectively.

FRAUDS REPORTED BY AUDITORS

In terms of Section 134 (3)(ca) of the Act there are no frauds reported by auditorsunder subsection (12) of section 143. Further there are no frauds reported by auditors tothe Central Government.

STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS

It is hereby stated in terms of Section 134 (3)(d) of the Act that all IndependentDirectors of the Company have given declarations that they meet the criteria ofIndependence as laid down under Section 149 (6) of the Companies Act 2013 read over withRegulation 16(1)(b) and 25(8) of Listing Regulations. They have also given a declarationthat their respective names have already been included in the data bank maintained by theIndian Institute of Corporate Affairs at Manesar and as such they are in compliance ofsub-rule (1) and sub-rule (2) of Rule 6 of the Companies (Appointment and Qualification ofDirectors) Rules 2014.

POLICY ON DIRECTORS APPOINTMENT AND POLICY ON REMUNERATION

Pursuant to the requirement under Section 134(3)(e) and Section 178(3) of the CompaniesAct 2013 the policy on appointment of Board Members including criteria for determiningqualifications positive attributes independence of a Director and the policy onremuneration of Directors KMPs and other employees is attached as Annexure D-1 asNomination and Remuneration Policy which forms part of this report.

EXPLANATIONS OR COMMENTS BY THE BOARD IN TERMS OF SECTION 134(3)(f) ON EVERYQUALIFICATION RESERVATION OR ADVERSE REMARK OR DISCLAIMER MADE:-

(i) by the Auditor in his report:-

M/s RAJIV GOEL & ASSOCIATES (Firm Regn. No. 011106N) Chartered AccountantsChandigarh were appointed as Statutory Auditors of the Company at the 36th Annual GeneralMeeting held on 29th September 2020 for a term of five consecutive years. The Auditors'Report being self-explanatory requires no comments from the Directors. Further there areno reservations qualifications disclaimers adverse remarks or Modified opinion in theAudit Reports issued by them in respect of Standalone as well as Consolidated FinancialStatements of the Company for the Financial Year 2020-21.

(ii) by the Company Secretary in practice in his Secretarial Audit Report:-

Mr. Anil Negi a Company Secretary in practice having CP no. 17213 and Membership no.46547 was appointed by the Board of Directors as Secretarial Auditor of the Company forthe financial year 2020-21 pursuant to Section 204 of the Companies Act 2013. TheSecretarial Audit Report submitted by him in the prescribed form MR-3 is annexed as AnnexureD-2 and forms part of this report.

There are no qualifications reservations adverse remarks or disclaimer by theSecretarial Auditor in the Report issued by him for the financial year 2020-21 which callfor any explanation from the Board of Directors.

Further there was one material unlisted subsidiary of the Company M/s Paul MerchantsFinance (Pvt) Limited during the Financial Year 2020-21 under review. As such SecretarialAudit Report of the said material unlisted subsidiary has been annexed to this Report as AnnexureD-2A as required under Regulation 24A of Listing Regulations. There are noqualifications reservations adverse remarks or disclaimer by the Secretarial Auditor inthe Report issued by him for the financial year 2020-21 which call for any explanationfrom the Board of Directors.

PARTICULARS OF LOANS GUARANTEES SECURITIES AND INVESTMENTS UNDER SECTION 186 OF THECOMPANIES ACT 2013

Pursuant to Section 134(3)(g) of the Act particulars of Loans Guarantees Securitiesand Investments under Section 186 of the Act made during the Financial Year 2020-21 areattached as Annexure D-4 which forms part of this report. Further reference in thisregard can be made to Note 2 6 9 10 37 and 38 to the Financial Statements for furtherdetails.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES UNDER SECTION 188(1) OFTHE COMPANIES ACT 2013

With reference to Section 134(3)(h) of the Act read over with Rule 8(2) of theCompanies (Accounts) Rules 2014 all contracts and arrangements with related partiesunder Section 188(1) of the Act entered by the Company during the financial year were onan arm's length basis. In the opinion of the Board these transactions were justified tobe executed because all the transactions had been entered into in the ordinary course ofbusiness of the Company in the furtherance of the business objectives. All the saidtransactions were done with prior approval of the Audit Committee and the Board. Thetransactions entered into pursuant to the omnibus approval of the Audit Committee werealso placed regularly before the Audit Committee for its review. The details of thesetransactions is given in Form AOC-2 annexed as Annexure D-5 which forms part ofthis report. Pursuant to Regulation 23(9) of the Listing Regulations your Company hasfiled the reports on related party transactions with the Stock Exchange duly on time.

During the year the Company had not entered into any contract or arrangement withrelated parties which could be considered ‘material' according to the policy of theCompany on Materiality of Related Party Transactions. Your attention is also drawn to theRelated Party disclosures set out in Note no. 41 of the Financial Statements for furtherdetails.

Details of transaction(s) of your Company with entity(ies) belonging to thepromoter/promoter group which hold(s) more than 10% shareholding in the Company asrequired under para A of Schedule V of the Listing Regulations are NIL as there is nosuch entity. Further the details of transactions with persons belonging to thepromoter/promoter group who hold(s) more than 10% shareholding in the Company have beenincluded in form AOC-2.

During the year under review Ms Sonali Bansal who is daughter of Mr. Sandeep BansalNon Executive Non Independent Director of the Company was appointed as Business Head(Digital Lending) in the Wholly Owned Subsidiary of the Company i.e. Paul MerchantsFinance (P) Ltd. w.e.f. 01.06.2020 on an annual remuneration of Rs. 632000/- subject toapproval of the Board of Directors of Paul Merchants Ltd. She will be given annualincrements by Paul Merchants Finance (P) Ltd in her remuneration based upon herperformance and the responsibilities to be given to her in future. Her appointment in theWholly Owned Subsidiary was approved by the Board of Directors of Paul Merchants Ltd intheir meeting held on 25-06-2020 and by the Audit Committee of the Board in its meetingheld on 24-06-2020. She is a Graduate with major in Maths and Economics from WellesleyCollege USA and considering her qualification and the profile to be handled by her theBoard of Directors is of the opinion that her appointment in the Wholly Owned Subsidiaryof the Company is justified.

Further Mrs Sarita Rani Bansal who is a Director of the Company and is related to Mr.Sat Paul Bansal Mr Sandeep Bansal and Mr Rajneesh Bansal Directors of the Company hasbeen appointed as Head (Administration) in the Wholly Owned Subsidiary of the Company i.e.Paul Merchants Finance (P) Ltd w.e.f. 01.06.2021 on a consolidated remuneration of Rs. 1.5Lakh per month subject to approval of the Board of Directors of Paul Merchants Ltd.. Shewill be given annual increments by Paul Merchants Finance (P) Ltd in her remunerationbased upon her performance and the responsibilities to be given to her in future. Herappointment in the Wholly Owned Subsidiary was approved by the Board of Directors of PaulMerchants Ltd in their meeting held on 08-06-2021 and by the Audit Committee of the Boardin its meeting held on 07-06-2021. She is a Graduate in Arts and while working with PaulMerchants Ltd as Director she has been lending useful inputs in the area of HumanResource Management and Administration of the Office Affairs of the Company. As suchconsidering her vast experience and the profile to be handled by her the Board ofDirectors is of the opinion her appointment in the Wholly Owned Subsidiary of the Companyis justified.

The policy on materiality of related party transactions and dealing with related partytransactions as approved by the Board may be accessed on the Company's website athttps://www.paulmerchants.net/paulmerchants/wp-content/uploads/2021/08/Related-Party-Transactions-Policy-12-08-2021.pdf

RESERVES:-

Entire amount of Net Profit of Rs. 126773112/- and Other Comprehensive income Rs.647428/- for the year has been transferred to the Reserves under the head "OtherEquity" in the Balance

Sheet. No amount has been transferred or proposed to be transferred to any otherreserves.

DIVIDEND:-

Your Directors have decided to reinvest the earnings in the growth of business and forthis reason have decided to not to recommend any amount for declaration of Dividend forthe year under review. Hence information required in terms of Section 134(3)(k) of theAct is Nil.

MATERIAL CHANGES AND COMMITMENTS

The onset of COVID-19 and its impact has been discussed at the beginning of this reportunder the heading "COVID19". There are no other material changes or commitmentseffecting the Financial position of the Company happening between the end of the FinancialYear 2020-21 to which the Financial Statements relate and date of this Report. Henceinformation as required in terms of Section 134(3)(l) of the Act is Nil.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS & OUTGO

The requisite information in terms of Section 134(3)(m) of the Act read over with Rule8(3) of Companies (Accounts) Rules 2014 has been given as per Annexure D-6annexed to this Report.

STATEMENT INDICATING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY INTERMS OF SECTION 134(3)(n) OF THE ACT

The Company has in place comprehensive risk assessment and minimization procedureswhich are reviewed by the Board periodically as per the Risk Management Policy of theCompany. The Board oversees the preparation of Risk Management Policy reviews andmonitors the same on regular basis and ensures to identify and review critical risks onregular basis to update the Risk management policy and Risk management plan on regularbasis to review key changes in critical risks and to issue instructions on the same tothe Management on an ongoing basis and such other functions as it deems fit. The Companyhas formulated Risk Management Policy which provides an overview of the principles of riskmanagement explains the approach adopted by the Company for risk management defines theorganizational structure for effective risk management develops a "risk"culture that encourages all employees to identify risks and associated opportunities andto respond to them with effective actions identify assess manage and mitigate existingand new risks including the elements of risk that may threaten the existence of theCompany in a planned and co-ordinated manner with minimum disruption and cost to protectand preserve Company's human physical and financial assets. The risks faced by theCompany and their minimization procedures are assessed categorically under the broad headsof High Medium and Low risks. Further the Company identifies risks and control systemsare instituted to ensure that the risks in each business process are minimized/mitigated.The Board provides oversight and reviews the Risk Management Policy periodically.

THE DETAILS ABOUT THE POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON CORPORATESOCIAL RESPONSIBILITY INITIATIVES TAKEN DURING THE YEAR IN TERMS OF SECTION 134(3)(o) OFTHE ACT:-

In terms of Section 135 of the Companies Act 2013 the Company has a duly constitutedCSR Committee of the Board and the said Committee had following composition as on March31 2021:-

1 Sh. Sandeep Bansal Non Executive Non Independent Director Chairman
2 Sh. Rajneesh Bansal Managing Director Member
3 Sh. Vigyan Prakash Arora Non Executive Independent Director Member
4 Sh. Hardam Singh Company Secretary Secretary to the Committee

The Board reconstituted the CSR Committee w.e.f. 01.07.2021 as below:-

1 Sh. Sat Paul Bansal Non Executive Non Independent Director Chairman
2 Sh. Rajneesh Bansal Managing Director Member
3 Sh. Vigyan Prakash Arora Non Executive Independent Director Member
4 Sh. Hardam Singh Company Secretary Secretary to the Committee

Other details of the CSR Committee and CSR Policy is furnished in the Report onCorporate Governance which is annexed as Annexure D-9 to this report. The detailsabout the policy developed and implemented by the Company on Corporate SocialResponsibility initiatives taken during the year in the form of CSR Policy is alsoavailable on the website of the Companyhttps://www.paulmerchants.net/paulmerchants/wp-content/uploads/2021/06/CSR-Policy.pdf. TheAnnual Report on CSR activities undertaken by the Company during the year under review isfurnished in Annexure D-7 which forms part of this report.

A STATEMENT INDICATING THE MANNER IN WHICH FORMAL ANNUAL EVALUATION OF THE PERFORMANCEOF THE BOARD ITS COMMITTEES AND INDIVIDUAL DIRECTORS HAS BEEN MADE IN TERMS OF SECTION134(3)(p) OF THE ACT READ OVER WITH RULE 8(4) OF THE COMPANIES (ACCOUNTS) RULES 2014:-

Pursuant to the applicable provisions of the Companies Act 2013 and the ListingRegulations the Board in consultation with its Nomination & Remuneration Committeehas put in place a framework containing inter-alia the criteria for performanceevaluation of the entire Board of the Company its Committees and Individual Directorsincluding Independent Directors. Accordingly following is the criteria for evaluation:-

a. Criteria for evaluation of the Board of Directors as a whole:
i. The Frequency of Meetings
ii. Quantum of Agenda
iii. Administration of Meetings
iv. Flow and quantity of Information from the Management to the Board
v. Number of Committees and their role.
vi. Overall performance of the Company
b. Criteria for evaluation of the Board Committees
i. The Frequency of Meetings
ii. Quantum of Agenda

iii. Administration of Meetings iv. Flow and quantity of Information fromthe Management to the Committee v. Role of Committees. vi. Contribution tothe decision making process of the Board.

c. Criteria for evaluation of the Individual Directors including IndependentDirectors; i. Experience and ability to contribute to the decision making process ii.Problem solving approach and guidance to the Management iii. Attendance andParticipation in the Meetings iv. Personal competencies as per Chart given in theNomination and Remuneration Policy and contribution to strategy formulation v. Contributiontowards statutory compliances monitoring of controls and Corporate Governance vi. Theevaluation of independent directors shall be done by the entire board of directors whichshall include (a) Performance of the directors; and (b) fulfillment of the independencecriteria as specified in the Companies Act 2013 and Listing Regulations and theirindependence from the management: Provided that in the above evaluation the directors whoare subject to evaluation shall not participate.

Accordingly the annual performance evaluation of the entire Board of the Company itsCommittees and Individual Directors including Independent Directors has been carried bythe Board in its Meeting held on 08-06-2021 in terms of the provisions of Section 134 (3)(p) of the Companies Act 2013 read over with Rule 8(4) of Companies (Accounts) Rules2014 and also in terms of Regulation 17(10) of the Listing Regulations as per abovecriteria and the Board expresses its satisfaction over the performance of the Board of theCompany its Committees and Individual Directors including Independent Directors. Theperformance evaluation of all the Independent Directors have been done by the entire Boardand while doing so the Director subject to evaluation had not participated. On the basisof performance evaluation done by the Board it is determined whether to extend orcontinue their term of appointment whenever their respective term expires.

The Independent Directors had met separately on 11-02-2021 without the presence ofNon-Independent Directors and the members of management and discussed inter-alia theperformance of non-Independent Directors and Board as a whole and the performance of theChairman of the Company after taking into consideration the views of Executive andNon-Executive Directors.

The Nomination and Remuneration Committee has also carried out evaluation of everyDirector`s performance performance of the entire Board of the Company as a whole and allits Committees.

The Directors express their satisfaction over the evaluation process.

CHANGE IN THE NATURE OF COMPANY'S BUSINESS

There is no change in the nature of Company's business during the year under review.Hence information required in terms of Rule 8(5)(ii) of the Companies (Accounts) Rules2014 is nil.

DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVE RESIGNEDDURING THE YEAR IN TERMS OF RULE 8(5)(iii) OF THE COMPANIES (ACCOUNTS) RULES 2014:-

DIRECTORS

During the year under review Mr. Sat Paul Bansal (DIN 00077499) had resigned from thepost of Chairman cum Managing Director of the Company w.e.f. 31.08.2020.

Sh. Dharam Pal Sharma (DIN 07284332) who was liable to retire by rotation wasre-appointed as Director by the Shareholders in their Annual General Meeting held on29-09-2020. He was also re-appointed as Designated Whole Time Director of the Companyw.e.f. 01-04-2020 by the Shareholders in their Annual General Meeting held on 29-09-2020.

Sh Rajneesh Bansal (DIN 00077230) who was liable to retire by rotation wasre-appointed as Director by the Shareholders in their Annual General Meeting held on29-09-2020. He was also re-appointed as Executive Director w.e.f. 01-04-2020 and asManaging Director (a Whole Time Key Managerial Personnel) of the Company w.e.f. 01-09-2020by the Shareholders in their Annual General Meeting held on 29-09-2020.

Mr. Inder Sain Negi (DIN 08947230) was appointed as an Additional Director in thecapacity of a Non Executive Independent Director of the Company by the Board of Directorsof the Company w.e.f. 12-11-2020 and he holds office up to the ensuing Annual GeneralMeeting.

Further in accordance with the provisions of the Companies Act 2013 and Articles ofAssociation of the Company Smt Sarita Rani Bansal (DIN 00094504) and Sh Sandeep Bansal(DIN 00094391) Directors of the Company retire by rotation in the ensuing Annual GeneralMeeting and being eligible offer themselves for re-appointment.

Further the following changes in the Directors and Key Managerial Personnel of theCompany took place after the end of the Financial Year 2020-21:-

Mr. Jeewan Lal Negi (DIN 09166359) was appointed as an Additional Director in thecapacity of a Non Executive Independent Director of the Company by the Board of Directorsof the Company w.e.f. 08-06-2021 and he holds office up to the ensuing Annual GeneralMeeting.

Mr. Sat Paul Bansal (DIN 00077499) was appointed as an Additional Director and Chairmanof the Board (Non Executive Non Independent Director) by the Board of Directors of theCompany w.e.f 08-06-2021 and he holds office up to the ensuing Annual General Meeting.

Further details as to the Directors proposed to be appointed in the ensuing AnnualGeneral Meeting of the Company are given in the Explanatory Statement to the item no. 56and 7 of the Notice.

The Brief Resumes and other details relating to the Directors who are proposed to beappointed/reappointed and whose remuneration is being fixed/varied as required to bedisclosed under Regulation 36 of the Listing Regulations and per Secretarial Standards-2form part of the Notice of Annual General Meeting.

KEY MANAGERIAL PERSONNEL

The Key Managerial Personnel (KMP) in the Company as per Section 2(51) and 203 of theCompanies Act 2013 as on 31.03.2021 are as follows:

Sh. Rajneesh Bansal Managing Director
Smt Bhupinder Kaur Chief Financial Officer
Sh. Hardam Singh Company Secretary

During the year under review Mr. Sat Paul Bansal (DIN 00077499) had resigned from theposition of Chairman cum Managing Director and Key Managerial Personnel (KMP) of theCompany w.e.f. 31-08-2020 and in his place Sh Rajneesh Bansal (DIN 00077230) had beenappointed as the Managing Director and Key Managerial Personnel of the Company w.e.f.01-09-2020.

There was no other change (appointment or cessation) in the office of KMPs during theyear under review.

A STATEMENT REGARDING OPINION OF THE BOARD WITH REGARD TO INTEGRITY EXPERTISE ANDEXPERIENCE (INCLUDING THE PROFICIENCY) OF THE INDEPENDENT DIRECTORS APPOINTED DURING THEYEAR IN TERMS OF RULE 8(5)(iiia) OF THE COMPANIES (ACCOUNTS) RULES 2014:-

Mr. Inder Sain Negi (DIN 08947230) was appointed as an Additional Director in thecapacity of a Non Executive Independent Director of the Company by the Board of Directorsof the Company w.e.f. 12-11-2020 during the year under review. Further Mr. Jeewan LalNegi (DIN 09166359) was appointed as an Additional Director in the capacity of a NonExecutive Independent Director of the Company by the Board of Directors of the Companyw.e.f. 08-06-2021. The Board do hereby state that in the opinion of the Board the saidIndependent Directors hold integrity expertise and experience in terms of Rule 8(5)(iiia)of the Companies (Accounts) Rules 2014. Further as declared by the said IndependentDirectors they are exempt from undergoing the online proficiency self-assessment testconducted by the Institute notified under sub-section (1) of Section 150 of the CompaniesAct 2013 based upon their past experience as provided in Rule 6(4)(A) of the Companies(Appointment and Qualification of Directors) Amendment Rules 2020

NAMES OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES JOINT VENTURESOR ASSOCIATE COMPANIES DURING THE YEAR:-

The information as required in terms of Rule 8(5)(iv) of the Companies (Accounts)Rules 2014 is as under:-

The Company has following two Subsidiaries:-

a. Paul Merchants Finance (Pvt) Ltd. is the Wholly Owned subsidiary of the Company. Thesaid subsidiary is engaged in the business of Gold Loans Business/personal loansDistribution of Insurance products and PPI Instruments. b. PML Realtors (Pvt) Ltd. is theWholly Owned subsidiary of the Company. The said subsidiary is engaged in buying andselling of Real Estate Projects.

The Company has no Associate Company but is having a Joint Venture Company in the nameof M/s Horizon Remit Sdn. Bhd. Malaysia.

During the year under review the Company has become partner in the LLP named Paul TechPark LLP. The Company holds 50% share in the said LLP as on 31st March 2021 and the otherpartner in the said LLP is M/s Espranza Innovations (P) Ltd. This LLP has been consideredto be a Joint Venture within the meaning of IND AS 110 and also within the meaning of"Associate Company" as per Section 2(6) of the Companies Act 2013.

During the year the Company has entered into partnership with M/s Espranza Innovations(P) Ltd in the LLP named Paul Innovations LLP. This LLP has been considered to be a JointVenture within the meaning of IND AS 110 and also within the meaning of "AssociateCompany" as per

Section 2(6) of the Companies Act 2013. The Company holds 50% share in the said LLP ason 31st March 2021.

There is no other change in the Subsidiaries Joint Ventures Or Associate Companies ofthe Company during the year under review.

DEPOSITS

The Company has neither accepted nor renewed any deposits during the Financial Year2020-21 in terms of Chapter V of the Companies Act 2013. As such information in thisregard and also the information in terms of Rule 8 (5) (v) and Rule 8 (5) (vi) ofCompanies (Accounts) Rules 2014 is nil.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALSIMPACTING THE GOING CONCERN STATUS AND COMPANY`S OPERATIONS IN FUTURE

The Company has not received any significant or material orders passed by anyRegulatory Authority Court or Tribunal which shall impact the going concern status andCompany`s operations in future. As such the information in terms of Rule 8 (5) (vii) ofthe Companies (Accounts) Rules 2014 is nil.

DETAILS IN RESPECT OF INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY WITH REFERENCE TOTHE FINANCIAL STATEMENTS IN TERMS OF RULE 8 (5) (viii) OF THE COMPANIES (ACCOUNTS) RULES2014

Your Company has in place sound internal financial control system to ensure that allassets are protected against loss from any unauthorised use and all transactions arerecorded and reported correctly. According to Section 134(5) (e) of the Companies Act2013 the term Internal Financial Control (IFC) means the policies and procedures adoptedby the company for ensuring the orderly and efficient conduct of its business includingadherence to company's policies safeguarding of its assets prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information.

The Company has a well placed proper and adequate internal financial control systemcommensurate with the size scale and complexity of its operations. The scope andauthority of the internal Audit function is well defined in the Organization. The internalfinancial control system ensures that all assets are safeguarded and protected that thetransactions are authorised recorded and reported correctly that the business of theCompany is conducted in an orderly and efficient manner that frauds and errors areprevented and detected that the accuracy and completeness of the accounting records isestablished and that reliable financial information is prepared in a timely manner. TheCompany's internal financial control system also comprises due compliances with Company`spolicies and Standard Operating Procedures (SOPs) and compliance with SEBI (Prevention ofInsider Trading) Regulations. The compliance is ensured by in-house Internal AuditDivision supplemented by Concurrent and Statutory Audit. The Internal Auditorsindependently evaluate the adequacy of internal controls and regularly audit thetransactions. Independence of the audit and compliance is ensured by regular supervisionby the Audit Committee over Internal Audit findings. Significant audit observations andcorrective actions suggested are presented to the Audit Committee of the Board onQuarterly basis.

The Internal Financial Control systems in place in the Company have been reviewed bythe Audit Committee on 07-06-2021 and by the Board of Directors of the Company on08-06-2021 and have satisfied themselves that the Internal Financial Control systems inplace in the Company are adequate.

DISCLOSURE AS TO COST AUDIT AND COST RECORDS

Maintenance of cost records as specified by the Central Government under sub section(1) of Section 148 of the Companies Act 2013 is not required by the Company and as suchthe Cost Audit is also not applicable to the Company. This disclosure is pursuant to Rule8(5)(ix) of the Companies (Accounts) Rules 2014.

OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013

Your Directors do hereby state in terms of Rule 8(5)(x) of the Companies (Accounts)Rules 2014 that the Company has complied with provisions relating to the constitution ofInternal Complaints Committee under the Sexual Harassment Of Women At Workplace(Prevention Prohibition And Redressal) Act 2013 (14 of 2013) and has adopted a policyfor prevention of Sexual Harassment of Women at workplace. During the year under reviewthe Company has not received any complaint of harassment.

DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY ANDBANKRUPTCY CODE 2016

There are no applications or proceedings under Insolvency and Bankruptcy Code 2016 inrelation to the Company and therefore information as required under Rule 8(5)(xi) andRule 8(5)(xii) of the Companies (Accounts) Rules 2014for the year under review is Nil.

DECLARATIONS ON COMPLIANCE WITH CODE OF CONDUCT BY DIRECTORS AND THE SENIOR MANAGEMENTPERSONNEL

The Annual Report of the Company contains a Declaration by the Managing Director interms of Para D of Schedule V to the Listing Regulations on the declarations received fromthe Directors and the Senior Management personnel affirming compliance with the Codeapplicable to them during the year ended March 31 2021. This Declaration has been givenas Annexure D-8 to this Report.

REVIEW OF LEGAL COMPLIANCE REPORTS

During the year the Board periodically reviewed compliance reports with respect to thevarious laws applicable to the Company as prepared and placed before it by theManagement.

MAXIMUM TENURE OF INDEPENDENT DIRECTORS

The maximum tenure of independent directors is in accordance with the Companies Act2013 and Regulation 25(2) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations

2015. The maximum tenure in one term of appointment of an Independent Director does notexceed 5 years and for two terms put together does not exceed 10 years.

SHARE CAPITAL

a. ISSUE OF SHARES WITH DIFFERENTIAL RIGHTS

The Company has not issued any shares with Differential Rights during the year underreview.

b. ISSUE OF SWEAT EQUITY SHARE

The Company has not issued any Sweat Equity shares or Employee Stock Options during theyear under review.

The Authorized Equity Share Capital of the Company as on 31st March 2021 was Rs.20000000/- (Rupees Two Crores Only) and paid up Equity share capital was Rs.10280000/- (Rupees One Crore Two Lakhs Eighty Thousand Only).

Further there was no buy back of its own shares by the Company and there was no otherchange in the share Capital of the Company during the year under review.

EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS

The impact of Covid 19 and Company's preparedness to deal with the implications arisingout of this scenario have already been discussed in the beginning of this report. Thereare no other events to be reported under this head.

CORPORATE GOVERNANCE :-

Your Company is committed to maintain the highest standards of Corporate Governance andis in compliance with the Corporate Governance Regulations as laid out in the Securitiesand Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015. As required under Regulation 34 (3) read with Part C of Schedule V to the Securities& Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 a Report on Corporate Governance is annexed herewith as Annexure D-9and forms a part of this Report.

A Compliance Certificate from Mr. Kanwaljit Singh Thanewal a Company Secretary inpractice having CP no. 5870 confirming compliance with the conditions of CorporateGovernance by the Company is also annexed to this Report as Annexure D-10 asrequired under Part E of Schedule V to the Securities And Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015.

BUSINESS RESPONSIBILITY REPORT

Regulation 34 (2) (f) of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 is not applicable to theCompany because the Company is not among top 1000 listed entities based on marketcapitalization as on 31-03-2021.

MANAGEMENT DISCUSSION & ANALYSIS REPORT:

Management Discussion & Analysis Report for the year under review as stipulatedunder Part B of Schedule V to the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 is presented in aseparate section as Annexure D-3 forming part of this Report.

PARTICULARS OF REMUNERATION OF DIRECTORS/ KMPs/EMPLOYEES:-

Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) 5 (2) and 5(3) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is annexed as Annexure D-11 whichforms part of this report.

DETAILS OF COMMISSION RECEIVED BY MANAGING DIRECTOR OR WHOLE TIME DIRECTOR

A sum of Rs. 3200000/- (Rupees Thirty Two Lakhs Only) has been paid to Mr. RajneeshBansal Managing Director of the Company as commission for the Financial Year 2020-21 onthe recommendation of the Nomination and Remuneration Committee of the Company.

Further no managing or whole-time director of the company who is in receipt ofCommission from the Company Paul Merchants Limited is receiving any remuneration orcommission from any holding company or subsidiary company of Paul Merchants Limited. Assuch information required in terms of Section as 197(14) of the Companies Act2013 isNIL.

CONSOLIDATED FINANCIAL STATEMENTS

Your Directors have pleasure in enclosing the Consolidated Financial Statements of PaulMerchants Limited consolidating the financials of its Wholly Owned Subsidiary CompaniesPaul Merchants Finance (Pvt) Ltd and PML Realtors (Pvt) Ltd. the Joint Venture CompanyM/s Horizon Remit Sdn. Bhd. Malaysia as required by Section 129(3) of the Companies Act2013 (Act) and Listing Regulations. Further the consolidation of Financial Statements hasalso been done with two LLPs i.e. Paul Innovations LLP and Paul Tech Park LLP in terms ofInd AS 110. The said Consolidated Financial Statements are prepared in accordance with theapplicable Indian Accounting Standards.

INDIAN ACCOUNTING STANDARDS 2015

The annexed financial statements for the Financial Year 2020-21 and correspondingfigures for 2019-20 comply in all material aspects with Indian Accounting Standards (IndAS) notified under Section 133 of the Companies Act 2013 (the Act) [Companies (IndianAccounting Standards) Rules 2015] and other relevant provisions of the Act.

HIGHLIGHTS OF PERFORMANCE OF SUBSIDIARIES/ASSOCIATES/JOINT VENTURES

The Company has two Wholly Owned Subsidiaries namely:-

a. Paul Merchants Finance (Pvt) Ltd. which is engaged in the business of Gold LoansBusiness/personal loans distribution of Insurance products and PPI Instruments. b. PMLRealtors (Pvt) Ltd. which is engaged in buying and selling of Real Estate Properties.

The Company has one Joint Venture Company in the name of M/s Horizon Remit Sdn. Bhd.Malaysia. The Company holds 19.424% equity stake in the said Joint Venture Company.EbixCash World Money India Limited (formerly known as Weizmann Forex Ltd. (CINL65990MH1985PLC037697) holding 19.424% equity stake Transcorp Enterprises Limited (CINU65922RJ1995PLC010050) holding 20% equity stake and Western Union Processing Limited anIrish Limited Liability Company holding 40% equity stake are the other partners in thesaid Joint Venture Company.

During the year under review the Company has become partner in the LLP named Paul TechPark LLP. The Company holds 50% share in the said LLP as on 31st March 2021 and the otherpartner in the said LLP is M/s Espranza Innovations (P) Ltd. This LLP has been consideredto be a Joint Venture within the meaning of IND AS 110 and also within the meaning of"Associate Company" as per Section 2(6) of the Companies Act 2013.

During the year under review the Company has entered into partnership with M/s EspranzaInnovations (P) Ltd in the LLP named Paul Innovations LLP. This LLP has been considered tobe a Joint Venture within the meaning of IND AS 110 and also within the meaning of"Associate Company" as per Section 2(6) of the Companies Act 2013. The Companyholds 50% share in the said LLP as on 31st March 2021.

During the FY 2020-21 the Subsidiary Company Paul Merchants Finance (P) Ltd. achievedgross revenue of Rs. 629080125.49 as against previous year figures of Rs.435731731.89 registering a growth of 44.37% over previous year. Further the saidSubsidiary Company achieved a Net profit after Tax of Rs. 197822103 /- Lakhs as againstthe previous year figures of Rs. 151161895 /-.

During the FY 2020-21 the Subsidiary Company PML Realtors (P) Ltd. achieved grossrevenue of Rs. 112684853.07/- as against previous year gross revenue of Rs 3137856/-.Further the said Subsidiary Company achieved Net Profit after Tax of Rs. 8603293.48/-as against previous year figures of Rs. 1572398.72/- registering a growth of 447% overprevious year.

During the FY 2020-21 the Joint Venture (JV) Company M/s Horizon Remit Sdn. Bhd.Malaysia achieved gross revenue of RM 12.44 Lakhs as against previous year gross revenueof RM 41.97 Lakhs. Further the JV incurred loss of RM 22.48 Lakhs. The corresponding Lossduring the previous year was RM 8.80 Lakhs. The financial year of the JV Company ends on31-12-2020 and accordingly these figures have been arrived at on the basis of unauditedfinancial information for the quarter ending March 2021 and audited Financial Statementsfor the period ended December 2020.

During the FY 2020-21 the Joint Venture (JV) LLP M/s Paul Innovations LLP achievedgross revenue of Rs. NIL. Further the said JV incurred net loss of Rs.5381/- during theyear under review. Previous year's figures are not available as this LLP was incorporatedduring the FY

2020-21 only.

During the FY 2020-21 the Joint Venture (JV) LLP M/s Paul Tech Park LLP (earlier knownas Paul & Singla Realtors LLP) achieved gross revenue of Rs. NIL as against previousyear gross revenue of Rs. NIL. Further the said JV incurred net loss of Rs.139183/- asagainst previous year figures of Rs. NIL.

On a consolidated basis the revenue from operations for FY 2020-21 was Rs. 3035.08crore i.e. down by 44% over the previous year's revenue of Rs. 5401.12 crore. Theconsolidated profit after tax (PAT) attributable to shareholders and non-controllinginterests for FY 2020-21 was Rs. 33.45 Crore as against the previous year figures of Rs.26.37 Crore registering a growth of 26.83%. The contribution by each company to theoverall performance of the company during the period under report is detailed below:-

Name of the Company Share in profit or loss for the year ending 31st March 2021 Share in profit or loss for the year ending 31st March 2020
as %age of consolidated profit or loss Amount (Rs in Lakhs) as %age of consolidated profit or loss Amount (Rs in Lakhs)
Paul Merchants Limited 38.55% 1267.73 44.27% 1189.53
Subsidiary Companies: - -
Paul Merchants Finance Private Limited 60.16% 1978.22 56.26% 1511.62
PML Realtors Private Limited 2.62% 86.03 0.59% 15.72
Joint Venture (Investment as per Equity Method):
M/s Horizon Remit BHD. SDN. Malaysia -1.31% -43.16 -1.11% -29.83
Paul Tech Park LLP -0.01% -0.46 -
Paul Innovations LLP -0.03 -
TOTAL 3288.34 2637.41
Adjustments arising out of consolidation 56.58 -49.63
TOTAL 3344.93 2637.41

Report on the performance and Financial position of the Subsidiary Companies and JointVenture Company in the specified format AOC-1 is annexed to the Directors' Report as AnnexureD-12.

AUDIT COMMITTEE

Your Directors wish to inform that in Compliance with Section 177 of the Companies Act2013 and Regulation 18 of Securities & Exchange Board of India (Listing Obligationsand Disclosure Requirements) Regulations 2015 an Audit Committee of the Board is dulyconstituted. The Audit Committee as on March 31 2021 comprises of the followingIndependent Directors:

Shri. Vigyan Prakash Arora Non Executive Independent Director Chairman
Shri Dilbag Singh Sidhu Non Executive Independent Director Member
Shri Ajay Arora Non Executive Independent Director Member
Sh. Hardam Singh Company Secretary Secretary to the Committee

Details of the Audit Committee have been given separately in the Corporate Governancereport which is annexed herewith as Annexure D-9. Further all recommendations ofAudit Committee were accepted by the Board of Directors.

NOMINATION & REMUNERATION COMMITTEE

In terms of Regulation 19 of Securities & Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 and pursuant to the provisionsof Section 178 (1) of the Companies Act 2013 Nomination & Remuneration Committee ofthe Board is duly constituted. As on March 31 2021 the Committee comprised of thefollowing Directors:

Sh. Dilbag Singh Sidhu Non Executive Independent Director Chairman
Sh. Sandeep Bansal Non Executive Non Independent Director Member
Shri. Vigyan Prakash Arora Non Executive Independent Director Member
Sh. Hardam Singh Company Secretary Secretary to the Committee

The said Committee was reconstituted by the Board on 08-06-2021 with the followingcomposition w.e.f. 01-07-2021:-

Sh. Dilbag Singh Sidhu Non Executive Independent Director Chairman
Sh. Inder Sain Negi Non Executive Independent Director Member
Shri. Vigyan Prakash Arora Non Executive Independent Director Member
Sh. Hardam Singh Company Secretary Secretary to the Committee

The details of Remuneration Policy and further details of this Committee are furnishedin the Report on Corporate Governance which is annexed as Annexure D-9 to thisreport.

STAKEHOLDERS RELATIONSHIP COMMITTEE

In terms of Regulation 20 of Securities & Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 and pursuant to the provisionsof Section 178 (2) of the Companies Act 2013 the Stakeholders Relationship Committee ofthe Board is duly constituted. As on March 31 2021 the Committee comprised of thefollowing Directors:

Sh. Vigyan Prakash Arora Non Executive Independent Director Chairman
Sh. Rajneesh Bansal Managing Director Member
Sh. Sandeep Bansal Non Executive Non Independent Director Member
Sh. Hardam Singh Company Secretary Secretary to the Committee

Further the said Committee was reconstituted by the Board on 08-06-2021 with thefollowing composition w.e.f. 01-07-2021:-

Sh. Vigyan Prakash Arora Non Executive Independent Director Chairman
Sh. Rajneesh Bansal Managing Director Member
Sh. Sat Paul Bansal Non Executive Non Independent Director Member
Sh. Hardam Singh Company Secretary Secretary to the Committee

Other details of the Committee have been given separately in the Corporate Governancereport which is annexed herewith as Annexure D-9.

CHANGE IN CAPITAL STRUCTURE AND LISTING OF SHARES

There is no change in the Capital Structure of the Company during the year underreview. The Shares of the Company are listed and traded at BSE Ltd under scrip code539113.

VIGIL MECHANISM

The Company has established a Vigil Mechanism cum Whistle Blower Policy in terms ofSection 177 (10) of the Companies Act 2013 and also in terms of Regulation 4 (2) (d) andRegulation 22 of Listing Regulations. The details of the said Vigil Mechanism cum WhistleBlower Policy is given in the Corporate Governance Section which is appended to thisReport as Annexure D-9. The

Vigil Mechanism cum Whistle Blower Policy is also available on the Company's websiteunder weblinkhttps://www.paulmerchants.net/paulmerchants/wp-content/uploads/2021/08/Vigil-Mechanism-policy-07-02-2019.pdf

INDUSTRIAL RELATIONSHIPS:-

Relations between the Management and the employees at all levels have been cordial andthe Directors wish to express their appreciation for the cooperation and dedication of theemployees of the Company.

HUMAN RESOURCES DEVELOPMENT

The Company is always on a look out to enhance the value proposition of its humancapital by acquiring the best talent available in each of the business segment itoperates. It is ensured to provide the working conditions whereby people are groomed andtrained to become managers. Wherever required the technology is pressed into service toensure increased productivity and efficiency. The career paths corresponding to theindividual aspirations of people and their qualifications are designed so that people growwith the Organization and are clear about their personal development viz a viz the growthand expansion of the Company. During the year under review the Company made sure that asafe and secure working place is provided to the people in the wake of Pandemic and themanagement of the Company stood firmly behind its people. As on 31-03-2021 the Companyhas 313 people on its rolls.

COMPLIANCE

The company has devised proper systems to ensure compliance of all laws applicable tothe company and the compliance reports issued by the Departmental Heads along with thereport of the Company Secretary under Section 205 of the Companies Act 2013 are placedbefore the Board every Quarter confirming compliance by the Company with all applicableLaws. In addition the Internal Audit and Concurrent Audit helps the Company gauge itslevels of Compliance on ongoing basis and to take corrective steps wherever needed.

COMPLIANCE WITH LISTING REGULATIONS:-

The equity shares of the company are listed on BSE Ltd (BSE). The Company has in placethe following Policies as required under Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015:-

1. ‘Policy for Preservation of Documents' under Regulation 9 of Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015.

2. ‘Archival Policy' under Regulation 30 of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015. The web link of ‘Archival Policy' ishttp://www.paulmerchants.net/paulmerchants/wp-content/uploads/2018/07/Policy-on-Archival-of-Records.pdf

3. ‘Policy on Criteria for determining Materiality of events/information' underRegulation 30 of

SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. The web linkof the ‘Policy on determining of Materiality' ishttps://www.paulmerchants.net/paulmerchants/wp-content/uploads/2021/08/Determination-of-Materiality-12-11-2020.pdf

The company has already paid listing fees for the Financial Year 2021-22 to BSE Ltd.and has also paid the Annual Custodial fee for the Financial Year 2021-22 to theDepositories.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company is in compliance with the applicable Secretarial Standards issued by theInstitute of Company Secretaries of India and approved by the Central Government underSection 118(10) of the Act.

INSIDER TRADING:

The Board of Directors of the Company have adopted the Code of Practices and Proceduresfor Fair Disclosure of Unpublished Price Sensitive Information. The said Code has beenposted on the Website of the Company www.paulmerchants.net. Further the Board has alsoadopted the Code Of Conduct To Regulate Monitor And Report Of Trading By DesignatedPersons and Their Immediate Relatives in accordance with the requirements of the SEBI(Prohibition of Insider Trading) Regulations 2015. The Insider trading policy of thecompany lays down guidelines and procedures to be followed and disclosures to be madewhile dealing with shares of the Company as well as the consequences of violation. Thesaid codes were duly adhered to during the year under review.

CEO/CFO CERTIFICATION

In accordance with the Regulation 17 (8) read with Part B of Schedule II to theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 pertaining to corporate governance norms Mr. Rajneesh Bansal ManagingDirector and Ms. Bhupinder Kaur Chief Financial Officer (CFO) have issued a certificateas per the said Regulation for the year ended March 31 2021. As the Company has no postof Chief Executive Officer (CEO) the said Certificate has been issued and signed by theManaging Director along with CFO of the Company. The said certificate forms an integralpart of this Report annexed as Annexure D-13. The certificate has been reviewed bythe Audit Committee and taken on record by the Board of Directors of the Company.

DEMATERIALIZATION OF SHARES

The Company's equity shares are in compulsory Demat mode in terms of SEBI Guidelines.This has been facilitated through arrangement with NSDL and CDSL. About 98.17% of theissued shares of the Company are already in dematerialized form as on 31-03-2021. M/sAlankit Assignments Limited New Delhi are acting as the Registrar and Share TransferAgents for this purpose and acts as common agency and all activities in relation to sharetransfer facility are maintained by them in terms of Regulation 7 (2) of Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015.

TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Members are requested to note that dividends if not encashed for a period of 7 yearsfrom the date of transfer to Unpaid Dividend Account of the Company are liable to betransferred to the

Investor Education and Protection Fund ("IEPF"). Further all the shares inrespect of which dividend has remained unclaimed for 7 consecutive years or more from thedate of transfer to unpaid dividend account shall also be transferred to IEPF Authority.In view of this Members are requested to claim their dividends from the Company withinthe stipulated timeline. Your Company did not have any funds lying unpaid or unclaimed fora period of seven years as on 31-03-2021. Therefore there were no funds which wererequired to be transferred to Investor Education and Protection Fund (IEPF).

Pursuant to the provisions of the Investor Education and Protection Fund Authority(Accounting Audit Transfer and Refund) Rules 2016 the Company shall make requisitecompliances as per the said Rules at appropriate time.

FINANCIAL STATEMENTS

Annual Report 2020-21 of the Company containing Standalone as well as ConsolidatedBalance Sheet Statement of Profit & Loss Cash Flow Statement other statements andnotes thereto prepared as per the requirements of Schedule III to the Companies Act2013 Directors' Report (including Management Discussion and Analysis Report and CorporateGovernance Report) is being sent via email to all shareholders who have registered emailaddress(es). Full version of Annual Report 2020-21 is also available for inspection at theRegistered office of the Company during working hours up to the date of ensuing AnnualGeneral Meeting (AGM). It shall also be available at the Company`s websitewww.paulmerchants.net on the website of the Stock Exchange i.e. BSE Limited atwww.bseindia.com and on the website of CDSL (agency for providing the Remote e-Votingfacility and e-voting system during the AGM/EGM) www.evotingindia.com. The Notice of theAGM shall also be available at the website of CDSL www.evotingindia.com.

ACKNOWLEDGEMENT

Your Directors wish to express their sincere appreciation to valued Clients ReserveBank of India Bankers Government Agencies and Employees of the company for theircontinued support & cooperation.

For & On Behalf of the Board For & On Behalf of the Board
(RAJNEESH BANSAL) (DHARAM PAL SHARMA)
MANAGING DIRECTOR WHOLE TIME DIRECTOR
(DIN 00077230) (DIN 07284332)
PLACE: CHANDIGARH
Date: August 12 2021

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