The Members R. J. Shah & Co. Ltd.
The Directors have pleasure in submitting their 62ND ANNUAL REPORT alongwith the Audited Balance Sheet and Profit & Loss Account for the year ended 31stMarch 2020.
| ||Current Year ended 31.03.2020 ||Previous Year ended 31.03.2019 |
| ||(Rs.) ||(Rs.) |
|Income || || |
|Revenue from operations ||156168242 ||44000000 |
|Other Income ||23725964 ||12271401 |
|Total Revenue ||179894206 ||56271401 |
|Less : Total Expenses (Excluding Depreciation) ||94945574 ||16718660 |
|Profit Before Depreciation & Taxation ||84948632 ||39552741 |
|# (-) Depreciation ||760410 ||1139739 |
|Profit Before Taxation ||84188222 ||38413002 |
|(-) Provision for Taxation || || |
|(i) Current Tax ||21519000 ||11000000 |
|(ii) Deferred Tax ||(95470) ||(237789) |
|Profit for the year ||62764692 ||27650791 |
Gross revenues for the year ended 31st March 2020 is Rs. 17 98 94206/-as against Rs. 5 62 71401/- in the previous year. Profit before taxation is Rs 8 4188222/- as against Rs. 3 84 13002/- in the previous year. The net profit of theCompany for the year under review was placed is Rs. 6 27 64692/- as against 2 7650791/- in the previous year.
The Board of Directors are pleased to recommend dividend @ 100% i.e. Rs.10/- per shareon 2 80100 Equity shares of Re.10/- each for the year under review subject to theapproval of members at the ensuing Annual General Meeting of the Company.
The dividend if approved by the Shareholders at the Annual General Meeting shallentail a payout of Rs. 2801000/-.
The paid up equity capital as on March 31 2020 was Rs.28 01000/-. During the yearunder review the Company has not issued any shares.
CHANGES IN THE NATURE OF BUSINESS
There is no change in the nature of business of the Company during the year.
MATERIAL CHANGES AND COMMITMENTS
There have not been any material changes and commitments affecting the financialposition of the Company between the end of the financial year of the Company as on March31 2020 and the date of this report i.e. June 26 2020.
No significant or material orders were passed by the Regulators or Courts or Tribunalswhich impact the going concern status and Company's operations in future.
DIRECTOR & KMP
Dr. Manubhai Patel (DIN 00402478) shall be the Director liable to retire by rotation atthe ensuing Annual General Meeting in accordance with the provisions of the Companies Act2013 and Articles of Association of the Company; and being eligible offers himself forre-appointment.
Mr. Ram Narayan Gupta member of Institute of Company Secretaries of India holdingMembership No. ) was appointed as Whole time Company Secretary of the Company witheffect from 06th March 2020
DECLARATION OF INDEPENDENT DIRECTORS
The Independent Directors have submitted their disclosures to the Board that theyfulfill all the requirements as stipulated in Section 149(6) of the Companies Act 2013 soas to qualify themselves to be appointed as Independent Directors under the provisions ofthe Companies Act 2013 and the relevant rules.
During the financial year 2019-20 your Company has not accepted any deposit within themeaning of Sections 73 and 74 of the Companies Act 2013 and rules made there under
Pursuant to the provisions of the Companies Act 2013 the Board has carried out anevaluation of its own performance the directors individually as well as the evaluation ofthe working of its Audit
DIRECTOR'S RESPONSIBILITY STATEMENT:
In terms of Section 134 (5) of the Companies Act 2013 the directors would like tostate that:
i) In the preparation of the annual accounts the applicable accounting standards havebeen followed.
ii) The directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that were reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit or loss of the Company for the year under review.
iii) The directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities.
iv) The directors have prepared the annual accounts on a going concern basis.
v) The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
vi) The directors had devised proper system to ensure compliance with the provisions ofall applicable laws and that such system were adequate and operating effectively.
The Company does not have any subsidiary.
Minimum four prescheduled Board meetings are held every year. Additional meetings areheld to address specific needs of the Company. In case of any exigency/ emergencyresolutions are passed by circulation. During the Financial Year 2019-20 the Board ofDirectors met Five times on 24/05/2019 08/08/2019 14/11/2019 30/01/2020 and 06/03/2020the maximum gap between any two meetings was less than one hundred and twenty days asstipulated under Regulation 17 of the Listing Regulations and Secretarial Standards.
RELATED PARTY TRANSACTIONS:
All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of the business. There are nomaterially significant related party transactions made by the company with Promoters KeyManagerial Personnel or other designated persons which may have potential conflict withinterest of the company at large.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
The company has not given any loans or guarantees covered under the provisions ofsection 186 of the Companies Act 2013.
The detail of the investments made by company is given in the notes to the financialstatements.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. To maintain its objectivity and independence the InternalAudit function reports to the Chairman of the Audit Committee of the Board & to theChairman & Managing Director.
The Accounts Department monitors and evaluates the efficacy and adequacy of internalcontrol system in the Company its compliance with operating systems accountingprocedures and policies.
Based on the report of internal audit function corrective action is taken and therebystrengthens the controls. Significant audit observations and recommendations along withcorrective actions thereon are presented to the Audit Committee of the Board.
NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee has been constituted as per the section178(1) of the Companies Act 2013. One Meeting of the Nomination & RemunerationCommittee Held during the Year.
Remuneration to Executive Directors:
The remuneration paid to Executive Directors is recommended by the Nomination andRemuneration Committee and approved by Board in Board meeting subject to the subsequentapproval of the shareholders at the General Meeting and such other authorities as may berequired. The remuneration is decided after considering various factors such asqualification experience performance responsibilities shouldered industry standards aswell as financial position of the Company.
Remuneration to Non- Executive Directors:
Remuneration by way of sitting fees for attending Board meetings are paid toNon-executive Director per meeting Rs. 5000/- per person
The Company's Audit Committee has been constituted as per section 177 of the CompaniesAct 2013. Four meetings of the Audit Committee were held during the financial year2019-20.
STAKEHOLDERS RELATIONSHIP COMMITTEE:
The Company's Stakeholders Relationship Committee has been constituted as per section177 of the Companies Act 2013 Five meeting of the Stakeholder Relationship CommitteeDuring the year
VIGIL MECHANISM / WHISTLE BLOWER POLICY:
The Company has a vigil mechanism named Fraud and Risk Management Policy to deal withinstance of fraud and mismanagement if any.
In staying true to our values of Strength Performance and Passion and in line with ourvision of being one of the most respected companies in India the Company is committed tothe high standards of Corporate Governance and stakeholder responsibility.
The Company has a Fraud Risk and Management Policy to deal with instances of fraud andmismanagement if any.
The FRM Policy ensures that strict confidentiality is maintained whilst dealing withconcerns and also that no discrimination will be meted out to any person for a genuinelyraised concern.
A high level Committee has been constituted which looks into the complaints raised. TheCommittee reports to the Audit Committee and the Board.
BUSINESS RISK MANAGEMENT:
Pursuant to section 134 (3) (n) of the Companies Act 2013 the company has constituteda business risk management committee. The details of the committee and its terms ofreference are set out in the corporate governance report forming part of the Boardsreport.
At present the company has not identified any element of risk which may threaten theexistence of the company.
AUDITORS & REPORT thereon
At the 59th AGM held on September 26 2017 the Members approved appointmentof Brijesh Dutt & Associates. (FRN: 144568W) as Statutory Auditors of the Company tohold office for a period of five years from the conclusion of that AGM till the conclusionof the 64th AGM subject to ratification of their appointment by Members atevery AGM if so required under the Act. The requirement to place the matter relating toappointment of auditors for ratification by Members at every AGM has been done away by theCompanies (Amendment) Act 2017 with effect from May 7 2018. Accordingly no resolutionis being proposed for ratification of appointment of statutory auditors at the ensuingAGM.
As per section 138 of the Companies Act 2013 the Company has appointed M/s. N S Bhatt& Co. internal auditors for the year to 2019-20 to conduct the internal audit and toensure adequacy of the Internal controls adherence to Company's policies and ensurestatutory and other compliance through periodical checks and internal audit.
As per Section 148 read with Companies (Audit & Auditors) Rules applicable to costauditors the company was not liable to appoint Cost auditors for the financial year2019-20.
Pursuant to provisions of section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed Mr. Deepak Rane a Practicing Company Secretaries in practice to undertake theSecretarial Audit of the Company. The Secretarial Audit report is annexed herewith
REPLY ON SECRETARIAL AUDITOR OBSERVATION
1. The company has complied with the provisions of Section 203 of the Companies Act2013 except for the appointment of Company Secretary however Company has appointedCompany Secretary on 06th March 2020
Ans. The Companies Act 2013 mandates the appointment but since the company's solepurpose of continuation is to recover its outstanding and no further orders have beenexecuted for the last few years the appointment looks very difficult and unviable.However the Company has appointed Mr. Ram Narayan Gupta as Company Secretary w.e.f. 06thMarch 2020
2. The Company has not opted for e-voting facility with either of the twoDepositories.
Ans: e-voting Facility AS the Company's 100% equity shares have been admitted in dematand hence e-voting facility will be granted by the Company to the shareholder.
3. The Company has received notice from Bombay Stock Exchange for non-compliance withRegulation 6(1) of SEBI (LODR) Regulation for non-appointment of Company Secretary.
Ans. However Company made the default good by appointing Mr. Ram Narayan Gupta asCompany Secretary w.e.f 06th March 2020
TRANSFER OF SHARES TO INVESTOR EDUCATION AND PROTECTION FUND
In pursuance of the provisions of Section 124(6) of the Companies Act 2013 and theIEPF (Accounting Audit Transfer and Refund) Rules 2016 notified on 7th September 2016in addition to the transfer of amounts of unclaimed/ unpaid dividend for the year 2012-13the underlying shares are also due for transfer to the IEPF Authority in case the dividendremaining unclaimed for a further 7 (Seven) continuous years.
This was in pursuance of the recent enforcement of section 124(6) of the Companies Act2013 and the Investor Education and Protection Fund Authority (Accounting Audit Transferand Refund) Rules 2016 which requires every Company to mandatorily transfer to IEPF theunderlying shares in respect of which unpaid/ unclaimed dividend has been transferred toIEPF and for which the dividend has still remained unpaid or unclaimed for a consecutiveperiod of next 7 (seven) years.
DEMATERIALIZATION OF SHARES
As on 31st March 2020 there were approximately 1 97860 Equity Shares dematerializedthrough depository viz. Central Depository Services (India) Limited (CDSL) whichrepresents about 70.64 % of the total issued subscribed and paid-up capital of theCompany.
EXTRACT OF ANNUAL RETURN
Pursuant to the provisions of Section 92(3) of the Companies Act 2013 read with Rule12(1) of the Companies (Management and Administration) Rules 2014 the extract of AnnualReturn of the Company for the financial year ended on March 31 2020 in Form MGT-9 isannexed herewith
CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
Pursuant to the provisions of Section 135 and Schedule VII of the Companies Act 2013CSR Committee of the Board of Directors had framed the policy on Corporate SocialResponsibility and the Projects and Programmes undertaken by the Company are beingregularly reviewed by the CSR Committee.
In compliance with regulations under the Companies Act 2013; CSR Committee constitutedhas been in place and CSR policy adopted by the Company will be applicable from01.04.2020 However the Company has voluntary spent on CSR activities during the currentyear under review.
CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS
SEBI Circular No. SEBI/LAD-NRO/GN/2015-16/013 dated 02nd September 2015 forapplicability of Corporate Governance and Management Discussion & Analysis reports. Itis hereby reported that the Company is under exempted category since both the conditionsare not fulfilled as the paid up equity capital of the Company is below Rs.10 Crores andNet worth is above Rs.25 Crores as on the last day of the s financial year (audited). i.e.31.03.2020.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
Your Company has always believed in providing a safe and harassment free workplace forevery individual working in Company's premises through various interventions andpractices. The Company always endeavors to create and provide an environment that is freefrom discrimination and harassment including sexual harassment. The Company has in placerobust policy on prevention of sexual harassment at workplace which is in line with therequirements of the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013.
Internal Complaints Committee (ICC') has been set up to redress complaintsreceived regarding sexual harassment. All employees (permanent contractual temporarytrainees) are covered under this Policy. ICC has its presence at corporate office as wellas at site locations. The Policy is gender neutral.
During the year under review No complaint with allegation of sexual harassment wasfiled with ICC as per the provisions of The Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013.
PARTICULARS OF EMPLOYEES
Information as per Section read with rule 5 of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 in respect of employees of the Companyis not applicable.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNING AND OUTGO
Considering the nature of activities of the company the Information relating toconservation of energy technology absorption and foreign exchange earnings and outgo arenot applicable to the Company. However the Company is making all efforts to conserve thesame and the Company's technology being indigenous the question of absorption by theCompany does not arise. Also no foreign exchange were earned or spent.
DETAILS OF FRAUDS REPORTED BY AUDITORS:
During the year under review there were no frauds reported by Statutory Auditors underprovision of section 143(12) of the Companies Act 2013 and rules there under.
COMPLIANCE WITH SECRETARIAL STANDARDS
The company confirms compliance with the applicable requirements of secretarialstandards.
ESTIMATION OF UNCERTAINTIES RELATING TO THE GLOBAL HEALTH PANDEMIC FROM COVID-19(COVID-19)
COVID-19 is the infectious disease caused by the most recently discovered coronavirusSARS-CoV-2. In March 2020 the WHO declared COVID-19 a pandemic.
The Company has adopted measures to curb the spread of infection in order to protectthe health of our employees and ensure business continuity with minimal disruption.
The Company immediately took steps to mitigate sanitary and health risks and theCompany promptly set up a team of experts to assist the Health and Safety at Work places.
In assessing the recoverability of receivables and other financials assets the Companyhas considered internal and external information upto the date of approval of theseStandalone financial statements. The impact of the global health pandemic may be differentfrom that of estimated as at the date of approval of these standalone financial statementsand the Company will continue to closely monitor any material changes to future economicconditions.
Your Company and its Directors wish to extend their sincerest thanks to the Members ofthe Company Bankers State Government Local Bodies Customers Suppliers ExecutivesStaff and workers at all levels for their continuous cooperation and assistance.