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Scan Projects Ltd.

BSE: 531797 Sector: Industrials
NSE: N.A. ISIN Code: INE393D01015
BSE 00:00 | 28 Mar Scan Projects Ltd
NSE 05:30 | 01 Jan Scan Projects Ltd
OPEN 5.63
52-Week high 5.63
52-Week low 3.17
P/E 4.69
Mkt Cap.(Rs cr) 2
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 5.63
CLOSE 5.63
52-Week high 5.63
52-Week low 3.17
P/E 4.69
Mkt Cap.(Rs cr) 2
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Scan Projects Ltd. (SCANPROJECTS) - Director Report

Company director report

To The Members

Your directors have pleasure in presenting the 29th Annual Report togetherwith the Audited Statements of Accounts of the Company for the financial year ended 31stMarch 2021:

1. Financial Highlights:

(Rs. In Lacs)

2020-21 2019-20
Revenue from Operations 304.49 315.66
Operating Expenditure 285.88 294.14
Earnings before interest tax depreciation and amortization
(EBITDA) 18.61 21.52
Other Income (Net) 4.19 0.00
Finance Costs 8.91 10.29
Depreciation and amortization expenses 6.46 7.88
Profit before exceptional item and tax 7.43 3.35
Exceptional item 0.00 0.00
Profit Before Tax (PBT) 7.43 3.35
Tax Expenses 4.37 1.35
Profit After Tax (PAT) 3.06 2.00
Opening Balance of Retained Earning 35.18 33.18
Less: Income Tax for earlier years adjusted 0.00 0.00
Amount of Surplus available for appropriation 38.23 35.18

2. Operations State of Company's affairs and Future Outlook:

The overall growth of the company is good and encouraging. In the current year 2020-21the Company has earned the total revenue from operation Rs.304.49 Lacs against theprevious year Rs.315.66 Lacs which reflects decreasing trend in the performance of theCompany. The net profit after tax of the company is Rs.2.00 Lacs and Rs.3.06 Lac in theyear 2019-20 and 2020-21 respectively. The same will further be improved in the ensuingyears because the Company has sufficient work order for Erection and Commissioning in handat different locations in India and Nepal which will be executed in the ensuing financialyear. All the above factors reflects that the management is serious and hopeful to achievebetter results in the ensuing years with present business activities. We further informthat there is no change in the business activities of the company in the current financialyear.

Estimation of uncertainties relating to the global health pandemic from COVID-19:The Company has taken into account all the possible impacts of COVID-19 in preparation ofstandalone financial statements including but not limited to its assessment of liquidityand going concern assumption recoverable values of its financial and non-financial assetsand impact on revenue recognition owing to changes in cost of fixed price contracts. TheCompany has carried out this assessment based on available internal and external sourcesof information up to the date of approval of standalone financial statements and believesthat the impact of COVID-19 is not material to these financial statements and expects torecover the carrying amount of its assets. The impact of COVID-19 on the standalonefinancial statements may differ from that estimated as at the date of approval of thesestandalone financial statements owing to the nature and duration of COVID-19.

3. Dividend:

No dividend has been recommended by the Directors this year and consequently no amountshave been transferred to general reserves.

4. Transfer to Reserves:

The board of the Company has decided not to transfer any fund to general reserve out ofthe amount available for appropriation and an amount of surplus Rs.35.23 Lacs to beretained in the profit and loss account.

5. Change in Share Capital if any

There has been no change in Share Capital of the Company during the financial year2020-21.

6. Listing of Shares

The shares of the Company are listed in Bombay Stock Exchange Limited Mumbai.Applicable listing fees have been paid up to date. The shares of the Company have not beensuspended from trading at any time during the year by the concerned Stock Exchange.

7. Deposits:

The company has not accepted any deposits from the public during the year and as suchno amount on account of principal or interest on deposits from public was outstanding ason the date of the balance sheet.

8. Directors:

As per the provisions of Section 152 of the Companies Act 2013 Smt. Prakriti ChandraDirector of the Company retires by rotation at the forthcoming Annual General Meeting andbeing eligible offered herself for re-appointment. The Board recommends herre-appointment.

S/Sh. Jawahar Lal and Sh. Ashok Kamboj has been re-appointed as AdditionalNon-executive independent Directors on 4th March 2021. As per the provisionsof Section 161(1) of the Companies Act 2013 and provisions of Articles of Association ofthe Company Sh. Jawahar Lal and Sh. Ashok Kamboj hold office only up to the date of thisAnnual General Meeting of the Company and are eligible for appointment as IndependentDirectors. The Company has received notice under Section 160 of the Act in respect of thecandidates proposing their appointment as Non-executive Independent Director of theCompany. Resolutions seeking approval of the members for the appointment of Sh. JawaharLal and Sh. Ashok Kamboj as Non-executive Independent Director of the Company have beenincorporated in the Notice of the forthcoming AGM along with brief details about them.

Due to death of Sh. Joginder Kumar Independent Director of the company Sh. Amit Bhatiahas appointed as Additional Non-executive independent Director on 15th October2021. As per the provisions of Section 161(1) of the Companies Act 2013 and provisions ofArticles of Association of the Company Sh. Amit Bhatia hold office only up to the date ofthis Annual General Meeting of the Company and are eligible for appointment asIndependent Director. The Company has received notice under Section 160 of the Act inrespect of the candidates proposing his appointment as Non-executive Independent Directorof the Company. Resolutions seeking approval of the members for the appointment of Sh.Amit Bhatia as Non-executive Independent Director of the Company has been incorporated inthe Notice of the forthcoming AGM along with brief details about them.

The notice convening the Annual General Meeting includes the proposal for appointmentof Directors.

Further your Company has also received declarations from all the Independent Directorsof the Company confirming that they meet with the criteria of Independence as prescribedunder the Act and Clause 49 of the Listing Agreement with the Stock Exchanges.

9. Board Evaluation:

Pursuant to the provisions of the Companies Act 2013 and Listing Regulations theBoard has carried out the annual performance evaluation of its own performance theDirectors individually as well as the valuation of the working of its various committeesas per the criteria of evaluation provided in the Nomination Remuneration and EvaluationPolicy adopted by the Company. The performance evaluation of Independent Directors wascarried out by the entire Board and the performance evaluation of the Chairman and theBoard as a whole was carried out by the Independent Directors.

10. Meetings of the Board:

The Board of Directors of your company met 6 times during 2020-21. The meetings wereheld on 31/07/2020 04/09/2020 15/09/2020 13/11/2020 13/02/2021 and 22/03/2021. Theintervening gap between the meetings was within the period prescribed under the CompaniesAct 2013.

11. Particulars of Loan given Investment made Guarantee given and Securitiesprovided:

There were no loans given investment made guarantee given and securities provided bythe Company under Section 186 of the Companies Act 2013 during the year under review andhence the said provision is not applicable.

12. Extract of Annual Return:

As provided under Section 92(3) of the Act the extract of annual return is given inAnnexure I in the prescribed Form MGT-9 which forms part of this report.

13. Subsidiary Joint Ventures and Associate Concerns:

The Company does not have any Subsidiary Joint Ventures or Associate Concerns as on 31stMarch 2021.

14. Corporate Governance:

Pursuant to regulation 34 of the Listing Regulations a separate section on CorporateGovernance practices followed by the Company is provided elsewhere in this report togetherwith a certificate confirming the compliance of conditions of Corporate Governance issuedby the Statutory Auditors of the Company is attached hereto as part of this report

15. Management's Discussion and Analysis Report

In terms of the provisions of Regulation 34 of the Listing Regulations theManagement's Discussion and Analysis Report for the year under review is presented in aseparate section forming part of this Annual Report.

16. Directors' Responsibility Statement:

The Financial statements are prepared in accordance with Indian Accounting Standards(Ind As) under the historical cost convention on accrual basis except for certainfinancial instruments which are measured at fair value the provisions of the Act (to theextent notified) and guidelines issued by the Securities and Exchange Board of India(SEBI). The Ind As are prescribed under Section 133 of the Companies Act 2013 ("theAct") read with Rule 3 of the Companies (Indian Accounting Standards) Rules 2015and Companies (Indian Accounting Standards) Amendment Rules 2016.

In accordance with the provisions of Section 134(5) of the Companies Act 2013 thedirectors hereby confirm that:

i) in the preparation of the annual accounts for the financial year ended 31stMarch 2021 the applicable accounting standard have been followed and there are nomaterial departures;

ii) they have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at 31st March 2021 and ofthe profit of the Company for the period from 1st April 2020 to 31stMarch 2021;

iii) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;

iv) they have prepared the annual accounts on a going concern basis;

v) they have laid down internal financial controls to be followed by the Companyand such internal financial controls are adequate and operating effectively; and

vi) they have devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

17. Contract and arrangements with Related Parties:

The Company's policy on dealing with related party transactions has been formulated andamended from time to time. All contracts/arrangements/ transactions entered by the Companyduring the financial year with related parties were in the ordinary course of business andon the arm's length basis. There are no materially significant related party transactionsmade by the company with promoters directors key managerial personnel or otherdesignated persons which may have a potential conflict with the interest of the companyat large. Your Directors draw attention of the members to Note 35 to the financialstatements which set out related party disclosures pursuant to clause 32 of the listingagreement. Information on transactions with related parties pursuant to Section 134(3)(h)of the Act read with rule 8(2) of the Companies (Accounts) Rules 2014 are given inAnnexure II in Form AOC-2 and the same forms part of this report.

18. Auditor and Auditors' Report:

M/s Vijay & Satish Bhatia Chartered Accountants Yamunanagar Statutory Auditorsof the company holds office till the conclusion of the ensuing Annual General Meeting andis eligible for re-appointment for another term.

As required under the provisions of section – 139(1) of the Companies Act 2013the company has received a written consent from M/s Vijay & Satish Bhatia CharteredAccountant to their appointment and a certificate to the effect that theirre-appointment if made would be in accordance with the Act and the Rules framed thereunder and that they satisfy the criteria provided in section- 141 of Companies Act 2013.The Board recommends their appointment for the financial year 2021-22.

The report of Statutory Auditors (appearing elsewhere in this Annual Report) isself-explanatory having no adverse comments. There were no instances of fraud reported bythe Statutory Auditors to the Central Government or to the Audit Committee of the Companyas indicated under the provisions of Section 143(12) of the Companies Act 2013.

Further auditor's report for the financial year ended 31st March 2021 isgiven as an annexure which forms part of this report.

19. Secretarial Auditors:

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 M/s J. P. Jagdev & Co. Ambala City a firm of Company Secretaries inpractice to conduct Secretarial Audit for the financial year 2020-21. The SecretarialAudit Report for the financial year ended 31st March 2021 is annexed herewithas Annexure III to this Report. The Secretarial Audit Report does not contain anyqualification reservation or adverse remark.

20. Cost Records and Audit::

Pursuant to Section 148(1) of the Companies Act 2013 read with the Companies (CostRecords and Audit) Amendment Rules 2014 the maintenance of Cost Record is not applicableon any business activities of the company hence this order is not applicable on Company.

21. Corporate Social Responsibility (CSR):

The Company is not required to constitute a Corporate Social Responsibility Committeeas it does not fall within purview of Section 135(1) of the Companies Act 2013 and henceit is not required to formulate policy on corporate social responsibility.

22. Risk Management:

The board of the Company has formed a risk management committee to frame implementand monitor the risk management plan for the Company. The Committee is responsible forreviewing the risk management plan and ensuring its effectiveness. The audit committee hasadditional oversight in the area of financial risks and controls. Major risks identifiedby the businesses and functions are systematically addressed through mitigating actions ona continuing basis.

23. Internal Control System and their adequacy:

The Company's internal controls are commensurate with the size of the company and thenature of its business. These have been designed to provide reasonable assurance withregard to recording and providing reliable financial and operational informationcomplying with applicable statutes safeguarding assets from unauthorized use executingtransactions with proper authorization and ensuring compliance of corporate policies. Thecompany has an audit committee the details of which are provided in the CorporateGovernance Report. The audit committee reviews the internal control system and follows upon the implementation of corrective actions if required. The committee also meets thecompany's statutory auditors to ascertain interalia their views on the adequacy ofinternal control system in the Company and keeps the Board of Directors informed of itsmajor observations from time to time. The management also regularly reviews theutilization of fiscal resource compliance with law efficiencies so as to ensure optimumutilization of resources and achieve better efficiencies. Based on its evaluation (asdefined in section 177 of Companies Act 2013) our audit committee has concluded that asof March 31 2021 our internal financial controls were adequate and operatingeffectively.

24. Vigil Mechanism Policy:

The Company has a vigil mechanism policy which also incorporates a whistle blowerpolicy in line with the provisions of the Section 177(9) and (10) of the Companies Act2013 and regulation 22 of the Listing Regulations which deals with the genuine concernsabout unethical behavior actual or suspected fraud and violation of the Company's Code ofConduct and ethics.

25. Committees of Board:

The Board of Directors of your Company had already constituted various committees incompliance with the provisions of the Companies Act 2013 and Listing Agreement viz. AuditCommittee Nomination and Remuneration Committee and Shareholder's/Investor's GrievancesCommittee. All decisions pertaining to the constitution of committees appointment ofmembers and fixing the terms of reference / role of the Committees are taken by the Boardof Directors. Detail of the role and composition of Committees including the number ofmeetings held during the financial year and attendance at meetings are provided in theCorporate Governance Report section of the Annual Report which forms part of this report.

26. Conservation of Energy Technology absorption and foreign exchange earningsand outgo:

Information required under Section 134(3) (m) of Companies Act 2013 read withCompanies (Accounts) Rules 2014 is given as under:

Conservation of Energy: The Company has not been carrying on any manufacturingactivities hence this information is not applicable on the company during the year underreview. Technology absorption adoption and innovation: The Company always adopted latesttechnologies for improving the performance and quality of its services. The Company'soperations do not require significant import of technology. Research and Development(R&D): The Company has not done any Research and Development work during the yearunder review. However the company has adopted/reviewed the methods for improving theperformance and quality of its services on regular basis.

Foreign Exchange Earnings and Outgo: The Company directly did not spend any foreignexchange and also did not earn any foreign exchange during the year under review.However the Company is having Branch/Permanent Establishment at Nepal and all theinformation related to foreign exchange earnings and outgo is pertained to Nepal branchonly.

(Rs. In Lacs)

Foreign exchange earnings and outgo 2020-21 2019-20
a. Erection Commissioning and Supervision related activities (Including Overseas Branch Revenue) NIL 106406.00
b. CIF Value of Imports NIL NIL
c. On Overseas Contracts (i.e. Overseas Branch expenditure) 571717.00 1296866.00
d. Capital Goods (i.e. Capital expenditure incurred at Overseas Branch) 0.00 0.00

27. Nomination Remuneration and Evaluation Policy:

The Nomination Remuneration and Evaluation Policy recommended by the Nomination andRemuneration Committee is duly approved by the Board of Directors of the Company and thesame are provided in the Corporate Governance Report section of the Annual Report whichforms part of this report.

28. Human Resources:

Your Company treats its "human resources" as one of its most important assetsand has taken continuous efforts to set up and maintain an efficient work force. Thecompany is continuously taken steps towards maintaining a low attrition rate which itbelieves shall be achieved by investing in learning and development programmes foremployees competitive compensation creating a compelling work environment empoweringemployees at all levels as well as a well-structured reward and recognition mechanism.

29. Particulars of Employees:

I) The information required under Section 197 of the Act read with rule 5(1) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are givenbelow:

a. The ratio of the remuneration of each director to the median remuneration of theemployees of the

Company for the financial year:

Executive Director Ratio to median Remuneration
1 Sh. Sunil Chandra (Managing Director) 0.76:1

Note: The Company has not given any remuneration/benefits to non-executive/independentdirectors of the company during the year 2019-20.

b. The percentage increase in remuneration of each director chief executive officerchief financial officer company secretary in the financial year:

Directors Company Secretary and Financial Officer % increase in remuneration in the financial year
1. Sh. Sunil Chandra (Managing Director) 20%
2. CS. Kaushal Walia (Company Secretary) NIL

c. The percentage increase in the median remuneration of employees in thefinancial year: NIL%

d. The number of permanent employees on the rolls of Company: 13 Employees as on31st March 2021

e. The explanation on the relationship between average increase in remunerationand Company performance: The performance of the Company for the current financial year isnot encouraging than the previous year. However the Company has minor increase inremuneration to Executive Director/key managerial personnel. While at Middle & Juniorlevel management the proper increment was given in accordance with the inflation rate andat workmen and staff level.

f. Comparison of the remuneration of the key managerial personnel against theperformance of the

Company: Remuneration to Managing and Whole time directors were paid as per the scaleapproved by the members of the company.

g. Variations in the market capitalization of the Company price earnings ratioas at the closing date of the current financial year and previous financial year:

Particulars March 31 2020 March 31 2021 % Change
Market Capitalization 91.08 100.57 (-)9.44%
(Rs. In Lacs)

h. Percentage increase over decrease in the market quotations of the shares ofthe Company in comparison to the rate at which the Company came out with the Last publicoffer:

Particulars March 31 2021 At the time of Last Public offer % Change
Market Price (BSE) 3.17 10.00 (-) 68.30%

i. Average percentile increase already made in the salaries of employees otherthan the managerial personnel in the last financial year and its comparison with thepercentile increase in the managerial remuneration and justification thereof and point outif there are any exceptional circumstances for increase in the managerial remuneration:Proper increments at both managerial and staff/worker level has been given in financialyear 2020-21.

j. Comparison of each remuneration of the key managerial personnel against theperformance of the

Company: The increase in salary of Managing Directors by 20% was as per term ofappointment.

k. The key parameters for any variable component of remuneration availed by thedirectors: No such variable component is included in the remuneration paid to directors.

l. The ratio of the remuneration of the highest paid director to that of theemployees who are not directors but receive remuneration in excess of the highest paiddirector during the year: Sh. Sunil Chandra (Managing Director): 1:2.50

m. Affirmation that the remuneration is as per the remuneration policy of theCompany: The Company affirms remuneration is as per the remuneration policy of theCompany.

II. There was no employee on the role of the company who drew remuneration inexcess of the limits prescribed by the provisions of Section 197(12) of the Companies Act2013 read with Rules 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 hence this relevant information is not applicable to the Company.

30. Disclosure under sexual harassment of women at workplace (PreventionProhibition & Redressal) Act 2013:

In order to prevent sexual harassment of women at work place a new act The SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 hasbeen notified on 9th December 2013. Under the said Act every company is required to setup an Internal Complaints Committee to look into complaints relating to sexual harassmentat work place of any women employee. Company has adopted a policy for prevention of SexualHarassment of Women at workplace and has set up Committee for implementation of saidpolicy. During the year Company has not received any complaint of harassment.

31. Other Disclosures:

Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:

i) No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.

ii) No Material changes and commitments affecting the financial position of theCompany occurred between the end of the financial year to which these financial statementsrelate and the date of this Report.

2. The provisions of Section 125(2) of the Companies Act 2013 related withtransfer of unclaimed dividend to Investor Education and Protection Fund do not apply tothe Company as there was no dividend declared and paid in previous years and there is nounclaimed dividend.

3. Equity Shares:

No issue of equity shares with differential rights as to dividend voting orotherwise during the year under review.

The Company has not bought back any of its securities during the year underreview.

No Bonus shares were issued during the year under review.

No issue of shares (including sweat equity shares) to employees of theCompany under Stock option Scheme during the year under review.

No Shares outstanding under the head Shares Suspense Account/UnclaimedSuspense Account at the beginning and end of the year under review.

32. Acknowledgements:

Your directors wish to place on record their gratitude for the valued support andassistance extended to the Company by the Shareholders Banks and Government Authoritiesand look forward to their continued support. Your directors also express theirappreciation for the dedicated and sincere services rendered by the Executives Officersand Employees of the Company.

By Order of the Board of Directors
Place: Yamunanagar
Dated: 04-09-2021
Managing Director
DIN: 01066065