Your directors have pleasure in presenting their 30thAnnual Report on the business andoperations of Scintilla Commercial & Credit Ltd (the "Company") togetherwith the audited statement of accounts for the year ended 31st March 2019.
Financial Highlights (Standalone and Consolidated)
During the year under review performance of your company is as under:
| || ||(in Rs. ) |
|Financial Result ||Year Ended 31.03.2019 ||Year Ended 31.03.2018 |
|Total Revenue ||8627057 ||5745225 |
|Less: Expenditure ||8573158 ||5333536 |
|Profit /(Loss) Before Tax ||53900 ||411689 |
|Less: Tax Expenses ||13632 ||97436 |
|Profit /(Loss) After Tax ||40268 ||314253 |
|Amount carried to Balance Sheet ||40268 ||314253 |
The consolidated performance of the group as per consolidated financial statements isas under:
| || ||(in Rs. ) |
|Financial Result ||Year Ended 31.03.2019 ||Year Ended 31.03.2018 |
|Total Revenue ||9471194 ||6947525 |
|Less: Expenditure ||9493960 ||6439437 |
|Profit /(Loss) Before Tax ||(22766) ||508088 |
|Less: Tax Expenses ||33733 ||121982 |
|Share of Profit / (Loss) transferred to Minority Interest ||(43192) ||32333 |
|Balance Profit / (Loss) C/F to the next year ||(11891) ||353773 |
Operating & Financial Performance
During the year under review the Company had earned a net profit of 40268/- ascompared to 314253/- for the Financial Year 2017-18.
Further the consolidated net loss of the Company stands at 55083/- for the FinancialYear 2018-19.
Consolidated Financial Statements
The consolidated financial statements of the Company as on March 31 2019 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 theAuditor's Report thereon form part of the Annual Report. The Net Worth of the consolidatedentity as on March 31 2019 stood at 101759204/-as against 101761627/- at the endof the previous financial year.
Material Changes & Commitments
There are no material changes and commitments affecting the financial position of thecompany which have occurred between the end of the financial year of the company to whichthe financial statements relate and the date of the report.
The Board of Directors of the Company does not propose to declare any dividend for theyear 31st March 2019.
Transfer to Reserves
The Board in its meeting held on May 30 2019 proposes to carry an amount of 8054/-to Statutory Reserve as per the existing provisions of the Companies Act 2013 and rulesthere under read with the Reserve Bank of India Guidelines as applicable to the Company.
The paid up Equity Share Capital as on March 31 2019 was 100277770/-. During theyear under review the company has not issued any shares or any convertible instruments.
Statutory & Legal Matters
There has been no significant and/ or material order(s) passed by any Regulators/Courts/ Tribunals impacting the status.
However there was a notice received by the company from BSE regarding issue related toshell companies and in this regard Forensic Audit is under process.
Cash and cash equivalent as on March 31st 2019 was 364200/- (previous year 782920).The Company's working capital management is based on a well-organized process ofcontinuous monitoring and controls.
The Company being a Non Deposit Accepting NBFC has not accepted any deposits withinthe meaning of Section 73 of the Companies Act 2013 and the Companies (Acceptance ofDeposits) Rules 2014.
Subsidiary / Joint Ventures / Associates
The Company has two Indian subsidiaries i.e. Jaimatarani Merchants Limited andMericogold Trading Limited as on 31st March 2019. None of the subsidiaries are materialin nature.
In accordance with Section 129(3) of the Companies Act 2013 the Company has prepareda consolidated financial statement of the Company and all its subsidiary companies whichis forming part of the Annual Report. A statement containing salient features of thefinancial statements of the subsidiary companies in the prescribed format AOC 1 is alsoincluded as the part of this report as Annexure-A.
In accordance Section 136 of the Companies Act 2013 the Annual Report of the Companycontaining therein its standalone financial statements consolidated financial statementsand related information and the audited annual accounts of the subsidiary companies havebeen placed on the website of the Company www.scintilla.co.in.
Internal Financial Control and its adequacy
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 Policy
Risk Management Programme involves risk identification assessment and risk mitigationplanning for strategic operational financial and compliance related risks across variouslevels of the organization. The Board of Directors and senior management team recurrentlyassess the operations and operating environment to identify potential risks and takenecessary mitigation actions.
Directors and Key Managerial Personnel
Changes during the year
During the year under review Mr. Dipak Kumar Kajrewal (DIN: 08280264) was appointed asthe Managing Director of the Company with effect from 14th November 2018. However heresigned from the Board with effect from 14th August 2019. Mr. Manoj Kumar Mundhara theIndependent Director also resigned from the Board with effect from 09th August 2018 dueto his pre-occupation.
Further the Company had appointed Mr. Prabhat Marda as the Chief Financial Officer(CFO) of the Company. Mr. Shashi Chandra Jha was appointed as the Company Secretary andCompliance Officer of the Company with effect from 14th February 2019 in place of Ms.Arpita Dey who resigned from the Company with effect from 12th November 2018. Mr. ShashiChandra Jha Company Secretary also resigned from the Board with effect from 5th July2019. Thereafter Ms Aayushi Kapur was appointed as the Company Secretary and ComplianceOfficer of the Company w.e.f. 14th August 2019.
Retirement by rotation
In terms of Section 152 of the Companies Act 2013 Mr. Jitendra Kumar Goyal retires byrotation at the ensuing Annual General Meeting and being eligible offers himself forre-appointment.
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 andRegulation 16 of SEBI (Listing Obligations and Disclosure Requirements) 2015.
Necessary Declarations have been obtained from all the Independent Directors underSection 149 (7) of the Companies Act 2013 and Regulation 25(8) of SEBI (ListingObligations and Disclosure Requirements) 2015.
Familiarisation Programme for Independent Directors
To familiarize the Independent Directors with the strategy operations and functions ofour company the executive directors/ senior managerial employees make presentation to theIndependent Directors about the company's strategy operations and service offeringsmarkets finance quality etc. The Director is also explained in detail the variouscompliances required from him as a Director under the various provisions of the CompaniesAct 2013 SEBI (Listing Obligation and Disclosure Requirement) Regulations 2015 SEBI(Prohibition of Insider Trading) Regulations 2011 the Code of Conduct of the Company andother relevant regulations.
Further at the time of appointment of an Independent director the company issues aformal letter of appointment outlining his/ her role function duties andresponsibilities as a director. The details of the familiarization programme imparted toindependent directors are disclosed on the Company's website www.scintilla.co.in.
During the Financial Year 2018-194 (four) 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.
Meeting of Independent Directors
In term of the requirement of Schedule IV to the Companies Act 2013 the IndependentDirectors had a separate meeting on 14th February 2019 without the attendance ofNon-Independent Directors and management of the Company.
The Board has duly constituted Audit Committee composition of which is provided underthe Corporate Governance Report. There have been no instances during the year whererecommendations of the Audit Committee were not accepted by the board.
Nomination & Remuneration Committee
The Board has duly constituted Nomination & Remuneration Committee composition ofwhich is provided under the Corporate Governance Report.
Stakeholders Relationship Committee
The Board has duly constituted Stakeholders Relationship Committee composition ofwhich is provided under the Corporate Governance Report.
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.
As part of the policy the Company strives to ensure that the level and composition ofremuneration is reasonable and sufficient to attract retain and motivate Directors / KMPsof the quality required to run the company successfully.
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 2019 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 transactions entered with Related Parties during the financial year were on anarm's length basis and were in ordinary course of business and the provision of Section188 of the Companies Act 2013 are not attracted. Thus disclosure in Form AOC- 2 is notrequired. The Audit Committee reviews all the related party transactions quarterly.Further the Company has not made any materially significant related party transactionswith Promoters Directors or other designated person which may have a potential conflictwith the interest of the Company at large.The Policy on Related Party transactions asapproved by the Board has been uploaded on the Company's Website and may be accessed theCompany's website at www.scintilla.co.in.
Your directors draw attention of members to notes to the Financial Statements which setout related party disclosures.
Annual evaluation of Board's Performance
Pursuant to provisions of Sections 134 149 178 read with Schedule IV of the CompaniesAct 2013 and Regulation 19(4) read with Part D of schedule II of SEBI ListingRegulations 2015 the Nomination and Remuneration Committee (NRC) of your Company hasformulated and laid down criteria for performance evaluation of the Board (includingCommittees) and every individual director (including Independent Directors& ManagingDirector) 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 Directors are evaluated on key aspects of the role whichincludes inter-alia effective leadership to the Board and adequate guidance to theManagement.
During the year the Board had evaluated performance of its own its Committees and theIndividual Directors. After the evaluation process was complete the Board was of the viewthat the performance of the Board as a whole was adequate and fulfilled the parameters asstipulated in the evaluation framework in its pro-growth activity and facing challengesoperational climatic and economic adversities during the year.
Your Company's Whistleblower Policy encourages Directors and employees to bring to theCompany's attention instances of unethical behaviour actual or suspected incidents offraud or leak of unpublished price sensitive information or any violation of the Code ofConduct that could adversely impact your Company's operations business performance and /or reputation. The Policy provides that your Company investigates such incidents whenreported in an impartial manner and takes appropriate action to ensure that requisitestandards of professional and ethical conduct are always upheld. The Company's Policyensures that no employee is victimised or harassed for bringing such incidents to theattention of the Company. The practice of the Whistleblower Policy is overseen by theAudit Committee and no employee has been denied access to the Committee. The WhistleblowerPolicy is available on your Company's website www.scintilla.co.in.
Corporate Social Responsibility
The provisions of Companies Act 2013 regarding Corporate Social Responsibility are notapplicable to the Company.
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 isINE892C01018.
At the 29th Annual General Meeting of the Company held in the year 2018 M/s C. K.Chandak & Co Chartered Accountants was appointed as statutory auditors of theCompany for a period of five years till the conclusion of 34thAGM of the Company. In termsof the first proviso to section 139 of the Companies Act 2013 the appointment of theAuditors shall be placed for ratification at every Annual General Meeting. However theCompanies Amendment Act 2017 has come into force on 7th May 2018 and the requirement ofratification of Auditors in every Annual General Meeting has been omitted. Hence M/s. C.K. Chandak & Co. Chartered Accountants will hold office for 5 years and they wouldnot be subject to ratification during continuation of in the office of the Auditors' ofthe Company.
Mr. Pratik Agarwal Practising Chartered Accountants was appointed as the InternalAuditor of the Company for the Financial Year 2018-19.
The Company had appointed Mr. Anand Khandelia Practising Company Secretary as theSecretarial Auditor of the Company for the Financial Year 2018-19. According to theprovision of Section 204 of the Companies Act 2013 read with Rule 9 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Secretarial AuditReport submitted by Company Secretary in Practice is enclosed as a part of this report asAnnexure-B.
The Auditor's Report read together with the Notes on Accounts are self-explanatory andtherefore do not call for any further explanation and comments. No frauds were reported bythe Auditor se under subsection 12 of Section 143 of the Companies Act 2013.
The Secretarial Audit Report of the Company does not contain any qualificationreservation or adverse remark.
Cost Records and Cost Audit
The provisions of cost records and cost audit as specified by the Central Governmentunder section 148 of the Companies Act 2013 are not applicable to the Company.
Corporate Governance and Shareholders Information
Your Company has always taken adequate steps to adhere to all the stipulations laiddown in SEBI (LODR) Regulations 2015. A report on Corporate Governance is included as apart of this Annual Report. Compliance Certificate from the Statutory Auditors of thecompany M/s. C.K. Chandak & Co. Chartered Accountants confirming the compliance withthe conditions of Corporate Governance as stipulated under SEBI (Listing Obligations &Disclosure Requirements) Regulations 2015 is included as a part of this report.
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 staffs were givenappropriate training in this regard.
Loans guarantees and investments made by the Company
The Company being a NBFC Company is exempted from the provisions of Section 186 of theCompanies Act 2013. Further the Company has given loans and made investments during theyear the detail of which are given in the notes to the financial statements.
Conservation of Energy Technology Absorption
Since the Company is an Investment Company the particulars relating to conservation ofenergy and technology absorption stipulated in the Companies (Accounts) Rules 2014 arenot 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 for the financial year 2018-2019 in Form No MGT-9 may bereferred to at the Company's official website www.scintilla.co.in.The details forming partof the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure-C.
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 herewith as Annexure-D and forms a part of theDirectors' 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 appended to the BalanceSheet of the Company.
Provisions of Sexual Harassment
The Company in place an Anti Sexual Harassment Policy in line with the requirements ofThe Sexual Harassment of Women at the Workplace (Prevention Prohibition & Redressal)Act 2013. Further the Company has constituted an Internal Complaints Committee forredressing the complaints against sexual harassment. There was no complaint receivedduring the year.
Management Discussion and Analysis Report
As required under SEBI (Listing Obligations and Disclosure Requirements) Regulations(LODR) 2015 the Management Discussion and Analysis Report is presented in separatesection forming part of the Annual Report.
The disclosures and reporting with respect to issue of equity shares withdifferential rights as to dividend voting or otherwise is not applicable as the Companyhas not issued any such shares during the reporting period.
The disclosures and reporting on issue of shares (including sweat equity sharesand Issue of Shares under Employees Stock Option Scheme) to employees of the Company underany scheme are not applicable as the Company has not issued any such shares during thereporting period.
The company has complied with the applicable provisions of Secretarial StandardsSS-1 and SS-2 with respect to convening of Board Meetings and General Meetings during theperiod under review.
There is no change in the nature of the business of the Company.
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 |
| ||Vidhu Bhushan Verma ||Jitendra Kumar Goyal |
| ||Director ||Director |
| ||(DIN 00555238) ||(DIN 00468744) |
|Place: Kolkata || || |
|Date: 14th August 2019 || || |