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Scintilla Commercial & Credit Ltd.

BSE: 538857 Sector: Financials
NSE: N.A. ISIN Code: INE892C01018
BSE 00:00 | 19 Dec Scintilla Commercial & Credit Ltd
NSE 05:30 | 01 Jan Scintilla Commercial & Credit Ltd
OPEN 8.77
PREVIOUS CLOSE 8.77
VOLUME 10
52-Week high 27.00
52-Week low 8.77
P/E 28.29
Mkt Cap.(Rs cr) 9
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 8.77
CLOSE 8.77
VOLUME 10
52-Week high 27.00
52-Week low 8.77
P/E 28.29
Mkt Cap.(Rs cr) 9
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Scintilla Commercial & Credit Ltd. (SCINTILLACOMM) - Director Report

Company director report

To

The Members

Your directors have pleasure in presenting their Twenty-Ninth Annual Report on thebusiness and operations of Scintilla Commercial & Credit Limited (the"Company") together with the audited statement of accounts for the year ended31st March 2018.

Financial Highlights (Standalone and Consolidated)

During the year under review performance of your company as under:

(in Rs.)

Financial Result Year Ended 31.03.2018 Year Ended 31.03.2017
Total Revenue 4863321 7715544
Less: Expenditure 4451632 8829804
Profit /(Loss) Before Tax 411689 (1114260)
Less: Tax Expenses 97436 55582
Profit /(Loss) After Tax 314253 (1169842)
Balance carried to Balance Sheet. 496529 265422

The consolidated performance of the group as per consolidated financial statements isas under:

(in Rs.)

Financial Result Year Ended 31.03.2018 Year Ended 31.03.2017
Total Revenue 6065621 8627805
Less: Expenditure 5557533 9667238
Profit /(Loss) Before Tax 508088 (1039433)
Less: Tax Expenses 121982 77483
Share of Profit / (Loss) transferred to Minority Interest 32333 23817
Balance Profit / (Loss) C/F to the next year 787579 516952

Operating & Financial Performance

The Standalone Gross revenues decreased to 4863321/- decreased of around 36.96% against7715544 /- in the previous year. Profit before taxation was 411689/- against (1114260/- )in the previous year. And

The Consolidated Gross revenues decreased to 6065621/- a decline of around 29.69 %against 8627805/-in the previous year. Profit before taxation was 508088/- against(1039433)/- in the previous year. After providing for taxation of 121982/- &77483/- respectively the net profit of the Company for the year under review was placedat 353773 /- as against (1140733)/- in the previous year.

Material Changes & Commitments

No material changes and commitments have occurred from the date of close of thefinancial year till the date of this Report which affect the financial position of theCompany.

Dividend

With the view to conserve the resources of company your directors regret to recommendany dividend for the period under report.

Transfer to Reserves

The Board in its meeting held on May 30 2018 proposes to carry an amount of Rs.62 851 to Statutory Reserve as per the existing provisions of the Companies Act 2013 andrules there under read with the Reserve Bank of India Guidelines as applicable to theCompany.

Deposits

The Company has neither accepted nor renewed any deposits.

Share Capital

The paid up Equity Share Capital as on March 31st 2018 was 100277770. During theyear under review the company has not issued any shares or any convertible instruments.

Change in the nature of business if any

There is no change in the nature of the business of the Company.

Statutory & Legal Matters

However there was a notice received by the company from BSE regarding issue related toshell companies and appointment of forensic Auditor therein . All queries issued by BSEduly replied and regarding appointment of Forensic Auiditor the matter is subjudice inthe form of suit file by the company to conduct Forensic audit.

Material Changes & Commitments occurring after the end of Financial Year

No material changes and/or commitments affecting the financial position of the Companyoccurred between the end of the financial year to which the attached financial statementsrelate to and up to the date of this report.

Financial Liquidity

Cash and cash equivalent as on March 31st 2018 was 782920 (previous year 3309722). TheCompany's working capital management is based on a well-organized process of continuousmonitoring and controls.

Deposits

The Company being a Non Deposit Accepting NBFC has not accepted any public deposits assuch no amount on account of principal or interest on public deposits was outstanding ason the date of the balance sheet.

The Company has not accepted deposits from the public falling within the ambit ofSection 73 of the Companies Act 2013 and the Rules framed there under.

Subsidiary / Joint Ventures / Associates

As on March 31st 2018 the Company has two Indian subsidiaries i.e JaimataraniMerchants Limited and Mericogold Trading Limited. During the year there has been no changein the nature of business of the two subsidiaries. In accordance with Section 129(3) ofthe Companies Act 2013 the Company has prepared a consolidated financial statement ofthe Company and all its subsidiary companies which is forming part of the Annual Report.A statement containing salient features of the financial statements of the subsidiarycompanies in the prescribed format AOC 1 is also included in the Board Report and isattached as ANNEXURE-I .In accordance with third proviso of Section 136(1) of theCompanies Act 2013 the Annual Report of the Company containing therein its standaloneand the consolidated financial statements has been placed on the website of the Company www.scintilla.co.in.Further as per fourth proviso of the said section audited annual accounts of each of thesubsidiary companies have also been placed on the website of the Company at www.scintilla.co.in.

Consolidated Financial Statements

The consolidated financial statements of the Company as on March 31 2018 are preparedin compliance with the applicable provisions of the Companies Act 2013 and perapplicable regulations of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. The audited consolidated financial statements together with theAuditors'

Report thereon form part of the Annual Report. The Net Worth of the consolidated entityas on March 31st 2018 stood at 101761627/- as against 101428149 at the end of theprevious financial year.

Internal Financial Control

The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weaknesses in the design or operation were observed.

Risk Management

Although the company has been following the principle of risk minimization as the normin every industry it has now become a compulsion. The Board members were informed aboutrisk assessment and after which the Board formally adopted and implemented the necessarysteps for monitoring the risk management plan for the company.

Directors and Key Managerial Personnel

In accordance with the provisions of the Companies Act 2013 Shri Jitendra Kumar Goyal(DIN: 00468744) retires by rotation at the ensuing Annual General Meeting and beingeligible offers himself for re-appointment . Brief profile of Shri Jitendra Kumar Goyal who is to be re-appointed is furnished in the notice of the ensuing Annual General Meetingas per Regulations 36(3) of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.The Board of Directors of your Company recommends the re- appointment ofShri Jitendra Kumar Goyal at the ensuing Annual General Meeting.

During the year under review at a meeting of the Board of Directors of the Company heldon 30th May 2018 on the recommendation of Nomination and Remuneration Committee appointedMs. Ritu Agarwal (DIN- 08143534) as additional woman independent non-exectuive director ofthe Company.

Company Secretary and Compliance Officer

During the year under review Mr. Anand Mishra Company Secretary and Compliance Officerof the Company resigned from the services of the Company. The resignation was effectivefrom 28th August 2017. Consequent to Mr. Anand Mishra's resignation the Boardappointed Miss. Arpita Dey as the Company Secretary KMP and Compliance Officer of theCompany with the effect from 29th August 2017.

Declaration by Independent Director(s)

The Board of Directors hereby certifies that the Independent Directors appointed on theBoard meet the criteria pursuant to Section 149(6) of the Companies Act 2013.

Further all Independent Directors have furnished their Declarations meeting thecriteria under Section 149(6) of the Companies Act 2013 and Regulation 25 SEBI (Listingand Disclosure Requirement) Regulations 2015.

Meetings of Board

During the Financial Year 2017-18 seven (7) meetings of the Board of Directors of theCompany were held. The details of which are given in the Corporate Governance Report. Theintervening gap between the Board Meetings was within the period prescribed under theCompanies Act 2013.

Board Induction Training and Familiarisation programme for Independent Directors

At the time of appointment of the Director a formal letter of appointment is given tohim which inter-alia explains the role functions and responsibilities expected from himas a Director of the Company. The Director is also explained in detail the variouscompliances required from him as a Director under the various provisions of the CompaniesAct 2013 Regulation 25 SEBI (Listing Obligation and Disclosure Requirement) Regulations2015 SEBI (Prohibition of Insider Trading) Regulations 2011 the Code of Conduct of theCompany and other relevant regulations. The Director upon appointment is formallyinducted to the Board. In order to familiarize the Independent Directors about thebusiness drivers they are updated through presentations at Board Meetings about theFinancials of the company and also about the new product launches. They are also providedbooklets about the business and operations of the company.

The Directors are also updated on the changes in relevant corporate laws relating totheir roles and responsibilities as Directors.

Meetings of Independent Directors

In term of the requirement of Schedule IV to the Companies Act 2013 the IndependentDirectors had a separate meeting on 8th February 2018 without the attendance ofNon-Independent Director and member of the management. Mr. Vidhu Bhushan Verma was electedas the Lead Independent Director of the Company all the Independent Directors were presentat the said meeting. The activities prescribed in paragraph VII of the Schedule IV to theAct were carried out at the said meeting.

Remuneration Policy

The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and to fixtheir remuneration. The Company's Remuneration Policy is available on the Company'swebsite at www.scintilla.co.in and forms a part of this Report of the Directors asAnnexure -II.

Director's Responsibility Statement

The Board of Directors acknowledges the responsibility for ensuring compliance with theprovisions of section 134(3)(c) read with section 134(5) of the Companies Act for theyear ended on 31st March 2018 and state that :

(i) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures if any;

(ii) the directors 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 at the end of the financial year and ofthe profit and loss of the Company for that period;

(iii) the directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

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

(v) the directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and

(vi) The directors have devised proper system to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.

Related Party Transactions

All Related party transactions that were entered into during the financial year were onan arms length basis and in the ordinary course of business. During the year the AuditCommittee had granted omnibus approval for transactions which were repative in nature forone financial year and all such omnibus approval were reviewed by audit committee on aquarterly basis. All related parties transactions were placed in meeting of AuditCommittee and the Board of Directors for necessary review and approval. These transactionswere in the Ordinary Course of Business of your Company and were at Arms Length Basisdetails of which as required to be provided under section 134(3)(h) of the Companies Act2013 are disclosed in Form AOC-2 as Annexure VII and forms part of this AnnualReport. The Policy on Related Party transactions as approved by the Board has beenuploaded on the Company's Website and may be accessed at the linkhttp://www.scintilla.co.in/policy/DOC_194281.SCC_related_party_policy.pdf

The details of the transactions with related parties during 2017-18 are provided in theaccompanying financial statements.

None of the Independent Directors had any pecuniary relationship or transactions withthe Company during the year under review.

Performance Evaluation

The Nomination and Remuneration Committee (NRC) of your Company has formulated and laiddown criteria for performance evaluation of the Board (including Committees) and everydirector (including Independent Directors and

Chairman & Managing Director) pursuant to provision of Section 134 Section 149read with Code of Independent Directors (Schedule iv)and Section 178 of the CompaniesAct2013 and Regulation 19(4) read with Part D of schedule II of SEBI ListingRegulations2015 covering inter-alia the following parameters namely:

1. Board Evaluation-degree of fulfillment of key responsibilities; Board culture anddynamics

2. Board Committee Evaluation-effectiveness of meetings; committee dynamics.

3. Individual Director Evaluation (including IDs)-contribution at Board Meetings.

Further the Executive Director is evaluated on key aspects of the role which includesinter-alia effective leadership to the Board and adequate guidance to the Management.

Board Evaluation

The Securities Exchange Board of India (SEBI) vide its circular No.SEBI/HO/CFD/CMD/CIR/P/2017/004 dated 5th January 2017 had issued a guidance note on BoardEvaluation which inter alia contains indicative criterion for evaluation of the Board ofDirectors its Committees and the individual members of the Board.

The Board of Directors at its Meeting held on 30th March 2017 had considered andadopted the indicative criterion for evaluation of the Board of Directors the Committeesof the Board and the individual directors as enumerated in the said Circular and amendedthe Board evaluation framework accordingly.

Pursuant to the new Evaluation Framework adopted by the Board the Board evaluated theperformance of the Board its Committees and the Individual Directors for the financialyear 2017-18. After the evaluation process was complete the Board was of the view thatthe performance of the Board as a whole was adequate and fulfilled the parametersstipulated in the evaluation framework in its pro-growth activity and facing challengingoperational climatic and economic adversities during the year. The Board also ensuredthat the Committees functioned adequately and independently in terms of the requirementsof the Companies Act 2013 and the Listing Regulations and at the same time supported aswell as coordinated with the Board to help in its decision making. The individualDirector's performance was also evaluated and the Board was of the view that the Directorsfulfilled their applicable responsibilities and duties as laid down by the ListingRegulations and the Companies Act 2013 and at the same time contributed with theirvaluable knowledge experience and expertise to grab the opportunity and counter theadverse challenges faced by the Company during the year.

Whistleblower Mechanism

Company is committed to adhere to the highest standards of ethical moral and legalconduct of business operations and in order to maintain these standards the Companyencourages its employees who have genuine concerns about suspected misconduct to comeforward and express these concerns without fear of punishment or unfair treatment. TheCompany has a strong and effective Whistleblower Policy which aims to deter and detectactual or suspected misconduct.

This mechanism also provides for adequate safeguards against victimization of employeeswho avail of the mechanism. Any employee may report such incident without fear to theVigilance Officer or alternatively to Chairman of the Audit Committee

The Audit Committee is empowered to monitor the functioning of the mechanism. Itreviews the status of complaints received under this policy. The Committee has in itsReport affirmed that no personnel have been denied access to the Audit Committee. Thedetails of whistle blower policy is posted on the website of the Company and can beaccessed at www.scintilla.co.in Corporate Social Responsibility

The provisions of Companies Act 2013 regarding Corporate Social Responsibility are notapplicable to the Company.

Listing

The shares of the Company are listed on the BSE Limited and Calcutta Stock ExchangeLimited. The Company's shares are compulsorily traded in the dematerialized form. The ISINallotted is INE892C01018.

Statutory Audit

Change in Auditors

Your Company's Auditors M/s T. C. Mahawar & Co Chartered Accountants (FRN:322294E) Kolkata were appointed as Statutory Auditors of the Company from theconclusion of the Annual General Meeting held on 25.09.2017 until the conclusion of 33rdAnnual General Meeting to be held in the year 2022. But due to his preoccupation in otherservices he is resigning from the post of statutory auditor of the company in forthcomingAGM.

M/s C. K. Chandak & Co Chartered Accountants have been proposed to be appointed asstatutory auditors of the Company at the ensuing Annual General Meeting for a period offive years from the conclusion of the ensuing 29th AGM till the conclusion of 34th AGM ofthe Company. The said firm has given its consent and declared that they are notdisqualified to be appointed as statutory auditors.

Report of M/s T. C. Mahawar & Co Chartered Accountants and statutory auditor'sReport does not contain any qualifications reservations or adverse remarks. The Auditor'sReport is enclosed with the financial statements in this Annual Report.

Auditor's Certificate on Corporate Governance

As required by SEBI (Listing Obligations and Disclosure Requirements) Regulation 2015the auditor's certificate on corporate governance is enclosed as ANNEXURE-IV to theBoard's report.

Secretarial Audit

Mr. Anand Khandelia Practicing Company Secretary was appointed to conduct thesecretarial audit of the Company for the financial year 2017-18 as required under Section204 of the Companies Act 2013 and Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014.

In terms of the provisions of Section 204(1) of the Company Act 2013 a SecretarialAudit Report in Form MR-3 given by Secretarial Auditor is annexed to this Report (ANNEXURE-III).The Report confirms that the Company had complied with the statutory provision listedunder Form MR-3 and the Company also has proper board processes and compliance mechanism.The Secretarial Audit Report does not contain any qualification reservation or adverseremark.

The Report confirms that the Company had complied with the statutory provision listedunder Form MR-3 and the Company also has proper board processes and compliance mechanism.The Secretarial Audit Report does not contain any qualification reservation or adverseremark.

Board Induction Training and Familiarisation programme for Independent Directors

At the time of appointment of the Director a formal letter of appointment is given tohim which inter-alia explains the role functions and responsibilities expected of him asa Director of the Company. The Director is also explained in detail the variouscompliances required from him as a Director under the various provisions of the CompaniesAct 2013 Regulation 25 SEBI (Listing Obligation and Disclosure Requirement) Regulations2015 SEBI(Prohibition of Insider Trading) Regulations 2011 the Code of Conduct of theCompany and other relevant regulations.

The Director upon appointment is formally inducted to the Board. In order tofamiliarize the Independent Directors about the business drivers they are updated throughpresentations at Board Meetings about the Financials of the company and also about the newproduct launches. They are also provided booklets about the business and operations of thecompany.

The Directors are also updated on the changes in relevant corporate laws relating totheir roles and responsibilities as Directors.

Code of Conduct

The Board of Directors has approved a Code of Conduct which is applicable to theMembers of the Board and all employees in the course of day to day business operations ofthe company. The code laid down by the Board is known as "code of businessconduct" which forms an Appendix to the Code. The Code has been posted on theCompany's website www.scintilla.co.in.

All the Board Members the Senior Management personnel and personnel one level belowthe Board have confirmed compliance with the Code. All Management Staff were givenappropriate training in this regard.

Internal Control Systems and Their Adequacy

The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The scope and authority of the Internal Audit function isdefined in the Internal Audit Manual. To maintain its objectivity and independence theInternal Audit function reports to the Chairman of the Audit Committee of the Board &to the Director.

Loans guarantees and investments by the Company

The Company has given loans and made investnments during the year the detail of whichare given in the notes to the financial statements.

The provisions of section 186 of the Companies Act 2013 read with Rule 11 of theCompanies (Meeting of Board and its Powers) Amendment Rules 2015 is exemted on yourcompany 2015 as your Company is NBFC registered with RBI whose principal business interalia includes financing of companies.

Conservation of Energy Technology Absorption

Since the Company does not own any manufacturing facility being an Investment Companythe particulars relating to conservation of energy and technology absorption stipulated inthe Companies (Accounts) Rules 2014 are not applicable.

Foreign Exchange Earning and Outgo

There is no foreign exchange earnings and outgo during the year under review.

Extract of Annual Return

The extract of Annual Return as for the financial year 2017-2018 in Form No. MGT-9 asrequired under Section 92(3) of the Companies Act 2013 read with Rule 12 of the Companies(Management and Administration) Rules 2014 is set out as an annexure to this Report. (ANNEXUREV).

Managerial Remuneration

The information required pursuant to Section 197(12) read with Rule 5(1) of TheCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect ofemployees of the Company is attached here as ANNEXURE VI and forms a part of theDirector's Report.

There are no employees who are in receipt of remuneration in excess of the limitspecified under section 134(3) (q) read with Rule 5 (2) and 5 (3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014.

RBI Guidelines for Non-Banking Financial Companies

The Company has observed all the prudential norms prescribed by the Reserve Bank ofIndia. The Schedule as required in terms of Paragraph 13 of Non-Banking FinancialCompanies Prudential Norms (Reserve Bank) Directions 2015 is annexed herewith.

Provisions of Sexual Harassment

The provisions of the Sexual Harassment of Women at the work place (PreventionProhibition and Redressal) Act 2013 is not attracted on the Company However the Companyhas a voluntary policy towards Prevention of Sexual Harassment of Women employees of theCompany and has set up a mechanism for registering and prompt redressal of complaintsreceived from all permanent and temporary employees and staffs.

Cautionary Note

The statements forming part of the Directors' Report may contain certain forwardlooking remarks within the meaning of applicable securities laws and regulations. Manyfactors could cause the actual results performances or achievements of the Company to bematerially different from any future results performances or achievements that may beexpressed or implied by such forward looking statements.

Prevention of Insider Trading

Your Company has adopted a Code of Conduct for prevention of Insider Trading incompliance with the SEBI (Prohibition of Insider Trading) Regulations 2015. AllDirectors employees and other designated persons who could have access to unpublishedprice sensitive information of the Company are governed by this Code.

The trading window for dealing with equity shares of the Company is duly closed duringdeclaration of financial results and occurrence of any other material events as per thecode. During the year under review there has been due compliance with the code.

General 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:

• Issue of equity shares with differential rights as to dividend voting orotherwise.

• Issue of Sweat equity shares.

• Your Company does not have any scheme of provision of money for the purchase ofits own shares by employees or by trustees for the benefit of employees.

• There was no revision in the Financial Statements.

• There was no change in the nature of business.

Acknowledgement

Your Directors take the opportunity of placing their sincere appreciation to theCentral Government State Government Banks Financial Institutions employeesassociates consultants and members of the company for their valuable guidance andsupport. The Board expects to receive their continued support in the future as well.

For and on behalf of the Board of Directors
Jitendra Kumar Goyal Vidhu Bhushan Verma
Place: Kolkata Director Director
Date: 30/05/2018 (DIN: 00468744) (DIN: 00555238)