Your Director's take pleasure in presenting the 73rd Annual Report together with theAudited Financial Statements for the year ended on 31st March 2021.
|Particulars ||(Rs. in Lakh) |
|Total Revenue ||2916 |
|Profit before Depreciation ||606 |
|Depreciation ||64 |
|Profit after Depreciation before tax ||542 |
|Exceptional Items ||(55) |
|Profit after Exceptional item ||487 |
|Tax Expense (including earlier year) ||(216) |
|Profit after Tax ||703 |
|Other Comprehensive Income ||84 |
|Total Comprehensive Income ||787 |
In view of the profits accrued during the year under review the Board of Directors haverecommended dividend of 25% on the Ordinary and Deferred shares which respectively is Rs2.50 and Rs 6.25 on each share of the Company for the financial year ended on March312021.
The construction activity in Project 'Naman Homes' is progressing satisfactorily.Initially this project suffered the adverse impact of corona pandemic but the company istaking every step to achieve the projected schedule and we are very hopeful that we shallbe able to complete the project well in time as committed to the allottees. Further inrespect of EWS and LIG flats the allotment procedure have been completed in supervision of'Prayagraj Development Authority' and thereafter sale deed have also been executed infavour of the allotees having made full payment.
In our previous report we had informed you that the next Group Housing Project issituated at Sarojini Naidu Marg in the centre of Dist. Prayagraj. The project has beennamed as 'The Crescent'. The building plans have been approved by the PrayagrajDevelopment Authority and construction work on this project has commenced in the lastquarter of the year under review.
The management has received positive feedback from the allottees in respect of theirsatisfaction about the timely completion of project and good quality construction work.We hope that the goodwill thus earned would go a long way in our future projects.
MANAGEMENT DISCUSSION AND ANALYSIS
A. Business Overview Industry Structure and Development
When the Govt eased the lockdown restrictions induced by corona pandemic it was hopedthat sluggishness in economy would end and we would be able to move forward. However thesituation remained normal for a very short period and second wave of the corona pandemichas created the fear and panic across the country. Restrictions although not so tight asthe in first wave were again imposed by the State Government. As a consequence thebusiness scenario again suffered a severe adverse effect and the confidence ofentrepreneur investors and the allotees was shattered. Another factor of longer impactand far reaching consequence was drying up of cash inflows from our customers again due tosluggish economy and price escalation / inflation. This caused a crisis of working capitalfunds. The construction activity in our projects was also adversely affected but somehowwe have through fund and labour management managed to make up and very hopefully shalldeliver the project on time as per schedule.
The welcoming feature are the steps taken by the Government of India in associationwith the State Governments to rectify the situation. Availability of credit has improved;the rate of interest has been kept down. There is relaxation in systems and procedures tocreate an environment of ease and comfort conducive to doing business. The State is givingpriority to real estate sector because it generates maximum employment for the unskilledlabour. The easy availability and cheaper housing loans are expected to lead towardsrecovery of economy and the real estate sector in particular.
B. Outlook on Opportunities Threats Risks and Concern
The Tier-I and II category cities have continued to witness a growth in demand despitethe fact that the housing projects in and around Metros have excess inventory. At the sametime there is also increasing product consciousness both in terms of quality of theresidential offering and confidence in the ability of the developer to deliver on time.Your company has striven to not only to offer better quality construction but to alsodeliver on time. It would not be out of place to mention that your company has earnedgoodwill on both these factors. Hence we firmly believe that despite some intermittentslowdown periods not in control of management your company is on the path of growth andprogress.
One area that is a matter of concern for both buyers and sellers is the inflationarymarket trends and scarcity of construction materials. Increases in input costs havenegative impact on project costs and margins. Keeping to time lines and reducing materialwastage is one way to counter increases in costs. Your company endeavours to improveperformance on these parameters year by year. While there are no significant unsoldinventory of apartments in the city your company does face competition from otherbuilders in the city who also have projects in the pipe line but on account of itsreputation and product differentiation your company is confident that demand for itshousing projects will remain high.
C. Subsidiary Company
M/s Farco Foods Pvt Limited the wholly owned subsidiary of your Company is engaged inmanufacture of biscuits on job work basis for M/s Surya Foods and Agro Limited for their"Priya Gold" brand. During the year under review the Company produced 5472 MT ofbiscuits and earned profit of Rs 21.59 lacs after tax. The subsidiary company has beenconsistently earning profit and has successfully maintained the manufacturing cost. In ourprevious report we had informed you that in view of a long term perspective the companyhas diversified into goat farming. In this context we further inform that theimplementation of the project is progressing satisfactorily and we hope to startcommercial activity shortly.
D. Internal Financial Controls
The Company has an adequate system of internal control to ensure compliance withpolicies and procedures commensurate with the size and scale of operations. The internalaudit work has been assigned to an independent firm of Chartered Accountant whichevaluates the efficiency and adequacy of internal control systems. The internal auditreports and recommendations are reviewed by the Audit Committee of the Board.
E. Development in Human Resource and Industrial Relations
The Company maintains a very cordial relationship with its employees. Theywhole-heartedly support the management in all its activities and endeavors.
F. Research and Development
In view of the nature of business activities of the Company there is little scope forresearch and development work. The company is making all efforts to reduce costs bymaintaining standards that benefit the consumers.
The Company is committed to maintain the highest standards of Corporate Governance andadhere to Corporate Governance requirements set out by SEBI. The Company has complied withall mandatory requirements of Corporate Governance. A separate report on governancepractices followed by the Company in compliance of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 on Corporate Governance along with aCertificate of Compliance from the Statutory Auditors is attached with the said separatereport which forms integral part of this Director's Report.
EXTRACT OF ANNUAL RETURN
Pursuant to section 92(3) of the Companies Act 2013 and Rule 12(1) of the Company(Management & Administration) Rules 2014 the extract of the Annual Return of theCompany in Form MGT-9 is annexed to this report as Annexure A.
The calendar of Meetings is prepared and circulated in advance to the Directors. Duringthe year four (4) Board Meetings were convened and details of same are given in theCorporate Governance Report.
DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134 (3) of the Companies Act 2013 the Directorsstate that;
(i) in the preparation of the Annual Accounts the applicable Indian accountingstandards have been followed;
(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 as at the end of the financial year andof the 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 the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
(iv) the Directors had 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; and
(vi) the Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
DECLARATION BY INDEPENDENT DIRECTORS
All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under section 149(6) of the Companies Act 2013 and SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.
NOMINATION & REMUNERATION
The Board on the recommendation of the Nomination & Remuneration Committee makethe appointment of Directors senior management and fix their remuneration. Key ManagementPersonnel are appointed by the Board after consideration of their qualification andexposure to required fields. The details are stated in the Corporate Governance Report.
RELATED PARTYTRANSACTIONS To provide transparency in management and ensure compliancewith the provisions of various laws the Audit Committee has provided guidelines to theDirectors/Board. The guidelines inter alia provide for identification manner of dealingconduct and documentation of such transactions as per the provisions of the Companies Actand other applicable rules and regulations.
All related party transactions that were entered in to during the financial year werein the ordinary course of business and are disclosed at Note No. 36 attached to thestandalone balance sheet and none of the transactions are of material nature and havepotential conflict with the interest of the
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
There is nothing to report about the conservation of energy and technology absorptionduring the year. There is no foreign exchange earning and outgo.
CORPORATE SOCIAL RESPONSIBILITY Pursuant to provisions of section 135 of the CompaniesAct 2013 a committee of Board of Directors has been formed and the member of theCommittee are:
|Mr. Mohammad Aslam Sayeed ||Chairman |
|Mr. Saleem Iqbal Shervani ||Member |
|Mr. Tahir Hasan ||Member |
The Board carries out annual evaluation of its own performance of the Directorsindividually as well of the working of its various Committees. The key areas forevaluation are the quality of deliberations and contribution towards performance andguidance to management. The Board of Directors expressed their satisfaction with theevaluation process.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of the section 152 of the Companies Act 2013 Mr.Azher Nisar Shervani (DIN: 00424635) and Mr. Raju Verghese (DIN: 01086812) Directorsretire by rotation at the ensuing Annual General Meeting and being eligible offerthemselves for reappointment. Brief resume of the Directors seeking reappointment alongwith other details as stipulated under SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 and in terms of Section 102(1) of the Companies Act 2013are provided in the Notice for convening the Annual General Meeting.
Pursuant to provisions of section 203 of the Companies Act 2013 the Key ManagerialPersonnel of the Company are Mr. Saleem Iqbal Shervani Managing Director Mr. TahirHasan Chief Financial Officer & WTD and Mr. S. K. Shukla Company Secretary.
The Directors recommend all the resolutions placed before the Members relating toDirectors for their approval.
In terms of provisions of section 139 and 142 and other applicable provisions if anyof the Companies Act 2013 read with the Companies (Audit and Auditors) Rules 2014 theShareholders in the 69th AGM held on 28.09.2017 have approved the appointment of M/s GuptaVaish & Co. Chartered Accountants Kanpur (Firm Registration No. 005087C) as StatutoryAuditors of the Company for a period of 5 Years from the conclusion of said Annual GeneralMeeting. However their appointment as Statutory Auditors of the Company shall be requiredto be ratified by the Members at subsequent Annual General Meeting. The Company hasreceived a confirmation from the said Auditors that they are not disqualified to act asthe Auditors and are eligible to hold the office as Auditors of the Company. Necessaryresolution for ratification of Appointment of the said Auditors is included in the Noticeof AGM for seeking approval of members.
Pursuant to the 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 Siddiqui & Associates Company Secretaries in Practice to undertake theSecretarial Audit of the Company. The Report of Secretarial Audit for the year 2020-21 isannexed herewith as Annexure -C and forms integral part of this Report.
CERTIFICATE OF NON-DISQUALIFICATION OF DIRECTORS
Pursuant to Regulation 34(3) and Schedule V Para C clause (10)(i) of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 Certificate regardingNon-Disqualification of Director issued by M/s Siddiqui & Associates CompanySecretaries in Practice is annexed herewith as Annexure -D and forms integral part of thisReport.
The Board of Directors on the recommendation of the Audit Committee appointed M/s P. L.Tandon & Co Chartered Accountants Kanpur to carry out the Internal Audit of theCompany.
Pursuant to the provisions of section 148 and all other applicable provisions if anyof the Companies Act 2013 ("Act") and the Companies (Audit & Auditors)Rules 2014 (including any statutory modification(s) or re-enactment thereof for the timebeing in force) M/s Shishir Jaiswal & Co. Cost Accountants (Firm Registration No.102450) has been appointed as Cost Auditors and the Company is maintaining cost records asper the provision of "Act".
The Company has not accepted or renewed any deposit during the year falling within theambit of Section 73 of the Companies Act 2013 and the Companies (Acceptance of Deposits)Rules 2014 accordingly no amount was outstanding as on the date of Balance Sheet.CONSOLIDATED FINANCIAL STATEMENT In accordance with the section 129(3) of the CompaniesAct 2013 and the Indian accounting standard Ind AS-27 on consolidated and separatefinancial statement(s) read with Indian Accounting Standard Ind AS-28 on accounting forinvestments in associates your Company has prepared the consolidated financial statementsand annexed to this report. However due to the severe Corona pandemic situation in NewDelhi and disruptions caused by lock down imposed by the Government of Delhi on account ofCOVID the financial statement of last quarter of financial year 20202021 of our associatecompany- Star Hotels Private Limited could not be prepared and presented to compile theCompany's share of profit/loss in consolidated financial results. A Statement in formAOC-1 containing salient features of the financial statements of the subsidiary andassociate company are attached as Annexure-E.
The observations of the Statutory Auditors in their report are appropriately dealt within notes forming part of Financial Statement. No qualification or adverse remarks has beenmade by the Secretarial Auditor in his Secretarial Audit Report.
DISCLOSURE UNDER RULE 5 OF THE COMPANIES (APPOINTMENT & REMUNERATION) RULES 2014.
None of the employee of the Company was in receipt of total remuneration of Rs.6000000/- per annum or Rs. 500000/- per month during the financial year under review.Disclosure required under section 197 of the Companies Act 2013 read with Rule 5 of theCompanies (Appointment & Remuneration of Managerial Personnel) Rules 2014 have beenannexed as Annexure F.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
The Company has in place an anti sexual harassment policy in line with the requirementsof Sexual Harassment of Women at Work Place (Prevention Prohibition and Redressal) Act2013. Till date the company has not received any complaint there under.
Pursuant to provisions of section 124(5) of the Companies Act 2013 the company hastransferred the unpaid or unclaimed dividends for the financial year up to 2011-12 fromtime to time on due dates to the Investor Education and Protection Fund (the IEPF)established by the Central Govt. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The details of loans guarantees and investments covered under the provisions ofsection 186 of the Companies Act 2013 are given in the notes to the financial statements.AUDIT COMMITTEE
The Company has an Audit Committee and details of constitution and terms of referenceare set out in the Corporate Governance Report.
Pursuant to the provisions of the section 177 of the Companies Act 2013 the Companyhas adopted Vigil
Mechanism policy which also incorporates a whistle blower policy. Adequate safeguardsare provided against victimization to those who avail the mechanism and access to theChairman of the Audit Committee while reporting about unethical practices malpractice andnon-compliance of policies.
LISTING WITH STOCK EXCHANGE
The Equity shares of the Company are listed on BSE Limited. Further details are set outin the Corporate Governance Report.
REPORTING OF FRAUD
The Auditors of the Company have not reported any fraud to Audit Committee asstipulated under second proviso of section 143(12) of the Companies Act 2013.
Industrial relations remained cordial during the period under review.
EVENT AFTER REPORTING PERIOD
Subsequent to the close of the year the Income Tax Authority has completed theassessment for the assessment year 2018-19 on 16th April 2021. The Income Tax Authorityhas raised the demand of Income Tax amounting to 2839.62 Lakh for which the Company hasfiled the appeal before Commissioner (Appeal). Therefore the Company has not made theprovision against the total demand of Rs. 2839.62 Lakh however the amount of demand hasbeen disclosed as contingent liabilities.
Your Directors wish to convey their deep sense of appreciation for the continuedsupport and co-operation extended by banks Central and State Governments and all otherstakeholders. The Directors also wish to place on record their sincere appreciation forthe commitment and enthusiasm of the employees for the Company.
|For and on behalf of the Board |
|Mohd. Aslam Sayeed ||Saleem I. Shervani |
|Director ||Managing Director |
|DIN : 06652348 ||DIN : 00023909 |
|Place : Prayagraj || |
|Date : August 14 2021 || |