Your Directors have pleasure in presenting the Twenty Third Annual Report together withthe Audited Financial Statements for the year ended 31st March 2017.
| || ||(Rs. In lakhs) |
| ||For the ||For the |
|Particulars ||year ended ||year ended |
| ||31.03.2017 ||31.03.2016 |
|Income || || |
|Other Income ||0.08 ||122.46 * |
|Expenditure ||32.38 ||90.50 |
|Interest ||2.85 ||0.04 |
|Depreciation & Exceptional Items ||(779.04) ^ ||11.89 |
|Profit / (Loss) before Tax ||743.89 ||20.03 |
|Tax Expenses (for earlier years) || ||40.26 |
|Profit / (Loss) after Tax ||743.89 ||(20.23) |
|Balance brought forward from || || |
|previous years ||(18280.15) ||(18259.92) |
|Balance carried over ||(17536.26) ||(18280.15) |
* includes interest income and writing off of creditors
^ Includes gain on transfer of fixed assets
REVIEW OF OPERATIONS AND OUTLOOK
The company does not have any business at present. All cost cutting methods areimplemented and the same will continue. In order to make the company represent improvedfinancial position and benefit shareholders the management is exploring variousopportunities for revival including capital restructuring.
The Company has accumulated losses reflecting in the books of accounts amounting to Rs1778479473/- represented as 'Deficit in Statement of Profit & Loss' in the Reserves& Surplus Account as on 31st March 2017 as per the audited financialresults of the Company which affects the growth of the Company. Hence based on therecommendation of the Audit Committee and subject to necessary approvals from variousstatutory authorities the Board of Directors felt that it would be prudent to go in forreduction of share capital. This would enable the Company to represent improved financialposition and benefit the shareholders to get better yield for their stake. Further theCompany can explore various opportunities that are not presently available.
The Company has not accepted any fixed deposits from public during the year.
TRANSFER TO RESERVES
In view of the losses transfer to General Reserves is not applicable.
In view of the loss incurred the Board does not recommend any dividend for thefinancial year ended 31st March 2017.
Mr Meleveettil Padmanabhan (DIN: 00101997) retires by rotation at the ensuing AnnualGeneral Meeting and being eligible he offers himself for re-election.
Mr V Sriraman was reappointed as the Wholetime Director for a period of three years 18thMay 2017 to 17th May 2020 and no remuneration is payable to him.
Brief resume of the Directors nature of expertise and names of Companies in which theyholds directorship and membership/ chairmanship in Board / Committees as stipulated underRegulation 36(3) of Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 are provided in the Annexure to the Noticeconvening the Annual General Meeting.
The Board met 4 times during the financial year the details of which are given in theCorporate Governance Report.
20.5.2016 9.8.2016 9.11.2016 8.2.2017
One meeting of Independent Directors was held on 8.2.2017.
The office of Messrs Gopikumar Associates (Firm Registration No.000981S) CharteredAccountants Chennai as Statutory Auditors of the Company expires at the conclusion of theensuing Annual General Meeting. In line with the requirements of Companies Act 2013 theCompany is required to appoint new auditors in place of Messrs Gopikumar Associates.Hence the Board of Directors based on the recommendation of the Audit Committeerecommended the appointment of M/s Srikaanth & Co. Chartered Accountants Chennai(Firm Registration No. 014139S) as the Statutory Auditors of the Company for period offive years from the conclusion of the 23rd AGM till the conclusion of the 28thAGM subject to ratification of the appointment by the members at every AGM. A resolutionseeking the approval of the shareholders for the appointment of Statutory Auditors isincluded in the Notice convening the ensuing Annual General Meeting.
M/s Srikaanth & Co. being eligible for appointment have furnished their consent toact as the Statutory Auditors of the Company in terms of the Second proviso to Section 139and a certificate to the effect that the appointment if made shall be in accordance withthe conditions laid down and that they satisfy the criteria provided under Section 141 ofthe Companies Act 2013.
The Board of Directors take this opportunity to place on record its gratefulappreciation for the contribution and services rendered by Messrs Gopikumar Associatesits partners and all its staff during its tenure of office as the Statutory Auditors ofthe company.
Nothing to report since there are no operations and no employees except the WholetimeDirector.
Audit Committee consists of majority of Independent Directors as its members. Duringthe year Audit Committee met four times the details of which are given in the CorporateGovernance Report.
The details of Nomination and Remuneration Committee Shareholders / InvestorsGrievance Committee (Stakeholders Relationship Committee) and Risk Management Committeeare given in the Corporate Governance Report.
DECLARATION BY INDEPENDENT DIRECTORS
Pursuant to Section 149(7) of the Companies Act 2013 the Company has receiveddeclarations from all Independent Directors confirming that they meet the criteria ofIndependence as laid down in Section 149(6) of the Companies Act 2013 read withRegulation 26 of Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015.
The Company has a Nomination and Remuneration Policy in place. Any Remuneration payableto Directors / Senior Management Personnel are based on the approval of Nomination and
Remuneration Committee. Presently this is not applicable as there is no remunerationpayable.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The Company has not given any loan (secured or unsecured) and has not given anyguarantee or provided any security to any person.
The Company has a Risk Management Policy. The Company has also constituted a RiskManagement Committee eventhough it was not mandatory. However this is not applicable atpresent as there are no business activities.
RELATED PARTY TRANSACTIONS
The Company has formulated a Policy for Related Party Transactions. The details havebeen disclosed in (Annexure 1).
FORMAL ANNUAL EVALUATION
In terms of the provisions of the Companies Act 2013 and the Listing regulations theBoard reviewed and evaluated its own performance and of various Committees. Theperformance evaluation of the Independent Directors were carried out by the entire Board.The performance evaluation of the Chairman and Non-Independent Directors were carried outby the Independent Directors.
WHISTLE BLOWER POLICY (VIGIL MECHANISM)
The Company has in place a Whistle Blower Policy for Directors / Employees.
DETAILS OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS
The Company has an internal financial control procedure in place. The internalfinancial controls are verified and certified by an independent Audit Firm.
CORPORATE SOCIAL RESPONSIBILTY (CSR)
CSR Policy is not applicable to the Company.
Internal Audit for the financial year ended 31st March 2017 was conducted byan independent firm viz. M/s Srikaanth and Co. Chartered Accountants to evaluateeffectiveness and adequacy of internal controls.
Mr B. Prabhakar Practicing Company Secretary Chennai was appointed as the SecretarialAuditor to undertake the Secretarial Audit of the Company for the financial year 2016-17.The Secretarial Audit Report is annexed to and forms part of this report (ReferAnnexure 2).
Cost Audit is not applicable to the Company.
PREVENTION OF SEXUAL HARASSMENT
Not applicable as there are no woman employees.
There were no material changes and commitments during the financial year.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Sub Section (3)(c) and Sub Section (5) of Section 134 of the Companies Act2013 the Directors to the best of their knowledge and belief confirm that: a) in thepreparation of the annual accounts for the financial year ended 31st March2017 the applicable accounting standards had been followed along with proper explanationrelating to material departures; b) the Directors had selected such accounting policiesand applied them consistently and made judgments and estimates that are reasonable andprudent so as to give a true and fair view of the state of affairs of the Company at theend of the financial year and of the profit / loss of the Company for that period; c) theDirectors had taken proper and sufficient care for the maintenance of adequate accountingrecords in accordance with the provisions of this Act for safeguarding the assets of theCompany and for preventing and detecting fraud and other irregularities; d) the Directorshad prepared the annual accounts on a going concern basis. e) the Directors had laid downinternal financial controls to be followed by the Company and that such internal financialcontrols are adequate and were operating effectively. f) the Directors had devised propersystems to ensure compliance with the provisions of all applicable laws and that suchsystems were adequate and operating effectively.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Nasscom forecasted IT sector's export revenues to grow at 7-8% in 2017-18 around thesame growth level as last year due to continued headwinds from the US market. US Policyraising fears of higher labour costs due to hiring more expensive US workers. However thepositive factors are improvements in financial services and digital businesses with focuson increasing investments in digitisation and automation. Revenue for the domestic marketis projected to grow at 10-11% in 2017-18 and the Indian IT industry is expected to addaround 130000-150000 new jobs during the year. Globally businesses of every industryhave been transformed in a thoughtful way due to software and computing technology.Traditional business models are being replaced with digital/software business models.However Quintegra is yet to take off from the ground and various options torevive/restructure the business are being explored.
The financial statements are prepared in compliance with the requirements of CompaniesAct 2013 and applicable accounting standards. Nothing to report in HR issues since thereare no operations and no employees except Wholetime Director. All the issues as areapplicable to IT Sector in general are briefed in this report even though they may not beapplicable to the company in the present scenario.
CORPORATE GOVERNANCE REPORTS
The report on Corporate Governance as required Regulation 34 (3) of Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 and a Compliance Certificate from the Statutory Auditors are annexed to and formspart of this report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION
With regard to requirements relating to conservation of energy technology absorptionas required under Section 134(3)(m) of the Companies Act 2013 read with Rule 8 of theCompanies (Accounts) Rules 2014 the Company has nothing specific to report.
FOREIGN EXCHANGE EARNINGS & OUTGO
The details of foreign exchange earnings and outgo are as detailed below:
| || ||Rs in lakhs |
|Particulars ||2016-17 ||2015-16 |
|Expenditure in Foreign Currency ||Nil ||Nil |
|Earnings in Foreign Currency ||Nil ||Nil |
PARTICULARS OF EMPLOYEES
There are no employees who are covered under Rule 5(2) of the Companies (Appointment& Remuneration of Managerial Personnel) Rules 2014.
The details of remuneration during the year 2016-17 as required under Section 197(12)of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointment &Remuneration of Managerial Personnel) Rules 2014 are attached and forms part of thisreport (Refer Annexure 3).
EXTRACTS OF ANNUAL RETURN
The extract of the Annual Return in the prescribed form MGT 9 is annexed to and formspart of this report (Refer Annexure 4).
SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS
The Board records its appreciation for the continued support and cooperation receivedfrom all its associates the shareholders customers suppliers banks and GovernmentDepartments and the employees.
| ||For and on behalf of the Board |
|Place : Chennai ||Meleveettil Padmanabhan |
|Date : 17.08.2017 ||Chairman |