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Simplex Realty Ltd.

BSE: 503229 Sector: Infrastructure
NSE: N.A. ISIN Code: INE167H01014
BSE 00:00 | 26 Feb 43.75 0
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NSE 05:30 | 01 Jan Simplex Realty Ltd
OPEN 44.50
PREVIOUS CLOSE 43.75
VOLUME 50
52-Week high 70.75
52-Week low 39.15
P/E
Mkt Cap.(Rs cr) 13
Buy Price 43.75
Buy Qty 60.00
Sell Price 46.00
Sell Qty 26.00
OPEN 44.50
CLOSE 43.75
VOLUME 50
52-Week high 70.75
52-Week low 39.15
P/E
Mkt Cap.(Rs cr) 13
Buy Price 43.75
Buy Qty 60.00
Sell Price 46.00
Sell Qty 26.00

Simplex Realty Ltd. (SIMPLEXREALTY) - Director Report

Company director report

To

The Members

Your Directors are pleased to present the Hundred and Fifth Annual Report togetherwith the Audited Accounts for the year ended 31st March 2018.

FINANCIAL RESULTS

(In Rs.)

2017-18 2016-17
Total Income 223691845 152703205
Loss before Depreciation Finance Costs Exceptional Item and Taxation (21073720) (82106036)
Less: Depreciation 1386869 1236459
Less: Finance Costs 1083842 3028549
Loss before Exceptional Item and Tax (23544431) (86371044)
Less: Exceptional Item 65557482 -
Loss before Tax (89101913) (86371044)
Less: Current Tax - -
Deferred Tax (16409619) (25517917)
Taxes of earlier years (net) (290718) -
Loss for the year (72401576) (60853127)
Other Comprehensive Income for the year net of tax 2432037 3215966
Total Comprehensive Income for the year (69969539) (57637161)

DIVIDEND

As the Company has incurred the losses during the year under review your Directorshave not recommended any dividend for the year ended 31st March 2018.

OPERATIONS

The total income of the Company for the current year is Rs.223691845/- as againstRs.152703205/- during the previous year. The Company has incurred a net Loss ofRs.72401576/- during the current year as against the Loss of Rs.60853127/- in theprevious year. The EPS for the current year is Rs.(24.20) as against Rs.(20.34) in theprevious year. The main reasons for the losses during the year are payment to theCollector as premium towards the change of user and impairment loss provided for in thevalue of investments in one of the associates. During the year the Company receiveddemand from the Collector of Mumbai for the payment of premium towards the change of userfor leasehold land which was developed after obtaining necessary permissions from theconcerned authorities. While seeking permission there was no policy applicable for thepremium to be charged for change of user. The Collector gave permission subject to paymentof 3 percent as adhoc premium and undertaking to pay the premium as and when the policy isframed. During the year the Government of Maharashtra has issued a policy related to thepremium payable for change of user for Government Land and which is 50 percent of readyreckoner rate applicable on the date of permission accordingly the Collector issueddemand notice for Rs.65557482/- being the difference of premium applicable as per thepolicy and adhoc amount already paid. As this is not expected to be of recurring naturethe same has been disclosed as Exceptional Item. The net worth of the investee company hasbeen fully eroded and there are no assets the Company has provided Rs.10385981/- asimpairment in the value of investment in one of the associates based on the availablemarket price of share as on the balance sheet date.

ASSOCIATE AND JOINT VENTURE COMPANIES

The Company has two Associate companies viz. Simplex Papers Limited and Simplex MillsCompany Limited. There are no joint venture companies within the meaning of Section 2(6)of the Companies Act 2013 (the Act).

In terms of proviso to sub-section 3 of Section 129 of the Act the salient features ofthe financial statements of the Associate Companies is set out in the prescribed formAOC-1 (Part 'B'-Associates and Joint Ventures) which forms part of the Annual Report.

PROJECT

The Company's project "Simplex KhushAangan" is a cluster of residential andcommercial spaces located on the prime location of S.V.Road Malad (West) Mumbai. Thisproject is completed and possession has been given to the buyer for the sold units. TheCompany has already sold about 73 percent of the carpet area. During the year the Companyhas recognized revenue from the project based on percentage completion method as per theguidance note issued by the Institute of Chartered Accountants of India.

The Company is developing a project consisting of villas at Nachinolla Goa. As Goa isa tourist destination to explore more opportunities in such destinations the Companystarted developing these villas. The civil work has been completed and finishing work isgoing on.

The Company continues to focus on consolidation of its operations rationalization ofbusiness and exploring the opportunities in the development and re-development projects ofresidential projects.

PUBLIC DEPOSITS

The Company has not accepted any deposits from the public and as such no amount ofprincipal or interest on deposits was outstanding as on the balance sheet date.

LOANS GUARANTEES AND INVESTMENTS

The details of Loans Guarantees and Investments covered under the provisions ofSection 186 of the Act are given in the notes to the Financial Statements.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Shri Tharavanat C SuseelKumar Director of the Company retires by rotation incompliance with Section 152 of the Act at the Hundred and Fifth Annual General Meeting(the AGM) of the Company and being eligible offers himself for re-appointment. The Boardof Directors are also of the opinion that he fulfills all the conditions as mentioned inthe Act.

The Board of Directors of the Company at its meeting held on 14th May 2018has re-appointed Shri Sanjay N Damani as the Executive Director of the Company for aperiod of five years with effect from 1st June 2018.

The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed under the Act andunder the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (theListing Regulations).

The details of the Director being recommended for appointment and re-appointment arecontained in the accompanying Notice of the AGM.

No Key Managerial Personnel has been appointed or has retired or resigned during theyear.

BOARD EVALUATION

The Board of Directors has carried out an annual evaluation of its own Performancealongwith the Board Committee and Individual Director pursuant to the provisions of theAct and the Listing Regulations a structured questionnaire was prepared after takinginto consideration inputs received from the Directors covering various aspects of theBoard's functioning composition of the Board and its Committees culture execution andperformance of specific duties obligations and governance.

The performance evaluation of the Independent Director was carried out by the entireBoard. The performance evaluation of the Chairman and the Non Independent Directors wascarried out by the Independent Directors. The Directors expressed their satisfaction withthe evaluation process.

NUMBER OF MEETINGS OF THE BOARD

During the year under review four Board meetings were held. The details of themeetings are given in Corporate Governance Report which forms part of this Report.

REMUNERATION AND NOMINATION POLICY

The Board has framed a policy for selection and appointment of Directors SeniorManagement and their remuneration. The details of this Policy is given in the CorporateGovernance Report which forms part of this Report.

FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

The Company has practice of conducting familiarization programme for IndependentDirectors of the Company. The details of the said programme are given in the

Corporate Governance Report which forms part of this Report.

PARTICULARS OF EMPLOYEES

During the year there was no employee in receipt of remuneration as prescribed in theRule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014. The prescribed particulars of Employees as required under Section 197(12) of the Actread with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is attached as Annexure IV and form part of this Report.

AUDITORS

As per the provisions of Section 139 of the Act the term of office of M/s. Dayal andLohia Chartered Accountants Mumbai as the Statutory Auditors of the Company will expirewith the conclusion of the AGM of the Company.

The Board of Directors places on record its appreciation for the services rendered byM/s. Dayal and Lohia Chartered Accountants Mumbai as the Statutory Auditors of theCompany.

Subject to the approval of the Members the Board of Directors of the Company hasrecommended the appointment of Khandelwal and Mehta LLP Chartered Accountants Mumbai(ICAI Firm Registration No. W100084) as the Statutory Auditors of the Company for a termof five years commencing from the Company's financial year 2018-2019 to hold the officefrom the conclusion of this AGM till the conclusion of the Hundred and Tenth AGM.

Khandelwal and Mehta LLP have confirmed that their appointment if made would bewithin the limits prescribed under Section 141(3)(g) of the Act and the Companies (Auditand Auditors Rules 2014 and that they are not disqualified in terms of Section 139 of theAct.

Members' attention is drawn to a Resolution proposing the appointment of Khandelwal andMehta LLP as the Statutory Auditors of the Company which is included at Item No. 3 of theNotice convening the AGM.

The Auditors have given an unmodified opinion(s) report on the financial statements forthe year under review.

SECRETARIAL AUDIT

A Secretarial Audit was conducted during the year in accordance with provisions ofSection 204 of the Act.

The Secretarial Auditor's Report is attached as Annexure II and forms part of thisReport. There is no secretarial audit qualification reservation or adverse remark for theyear under review.

CORPORATE GOVERNANCE

The Company has complied with the mandatory provisions of Corporate Governancerequirements as stipulated under the Listing Regulations. A separate report on CorporateGovernance along with the requisite Auditors' Certificate is annexed and forms part ofthis Report.

DIRECTOR'S RESPONSIBILITY STATEMENT

Pursuant to the provisions of Sections 134(3)(c) and Section 134(5) of the Act and theListing Regulations on the basis of information placed before them the Directors statethat:

I. in the preparation of the annual accounts the applicable indian accountingstandards have been followed along with proper explanation relating to materialdepartures if any;

ii. appropriate accounting policies have been selected and applied consistently andthe judgments and estimates that have been made are reasonable and prudent so as to give atrue and fair view of the state of affairs of the Company as at 31st March2018 and the Loss of the Company for the said period;

iii. proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. the internal financial controls to be followed by the Company and that such internalfinancial controls are adequate and were operating effectively; and

vi. there is a proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.

RELATED PARTY TRANSACTIONS

All Related Party Transactions that were entered into during the financial year were onan arm's length basis in the ordinary course of business and were in compliance with theapplicable provisions of the Act and the Listing Regulations. There were no transactionsduring the year which would require to be reported in Form AOC-2. There are no materiallysignificant related party transactions made by the Company with Promoters Directors KeyManagerial Personnel or other designated persons which may have a potential conflict withthe interest of the Company at large during the year that would have required Membersapproval under the Listing Regulations.

The policy on Related Party Transactions as approved by the Board is available on theCompany's website. None of the Directors has any pecuniary relationships or transactionsvis-a-vis the Company.

CORPORATE SOCIAL RESPONSIBILITY

During the year under review the CSR Committee recommended that since the Company madeinadequate profit during the three preceding financial year there is no statutoryrequirement for spending on CSR activities in terms of the provisions of 135 of the Act.However the Company and its management is committed to contribute towards the bettermentof the society where we live and work as and when the Company's cash flow permits.

The details of Committee and its terms of reference are set out in Corporate GovernanceReport. The Annual Report on CSR activities is attached as Annexure I and forms part ofthis Report.

RISK MANAGEMENT

Risk management Policy has been developed and implemented. The Board is kept informedof the risk mitigation measures being taken through risk mitigation report/operationreport. There are no current risks which threaten the existence of the Company.

INTERNAL CONTROLS SYSTEMS AND ADEQUACY

The Company has in place an adequate system of internal controls. It has documentedpolicies and procedures covering all financial and operating functions and processes.These have been designed to provide a reasonable assurance with regard to maintaining ofproper accounting controls for ensuring reliability of financial reporting monitoring ofoperations protecting assets from unauthorized use or losses and compliance withregulations. The details of the internal controls system are given in the ManagementDiscussion and Analysis Report and forms part of this Report.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company has a Vigil Mechanism/Whistle Blower Policy to deal with instance of fraudand mismanagement if any. The detail of the Policy is explained in the CorporateGovernance Report and is also available on the Company's website.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is attachedas Annexure III.

STOCK EXCHANGE

The Company's equity shares are listed at BSE Limited and the Annual Listing Fees forthe year 2018-19 has been paid.

PARTICULARS OF CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION FOREIGN EXCHANGEEARNINGS AND OUTGO

Considering the Company's business activities the Directors have nothing to reportunder Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules2014 with reference to Conservation of Energy and Technology Absorption.

Foreign Exchange Transactions: 2017-18 2016-17

Foreign Exchange Earnings (Rs.) Nil Nil

Foreign Exchange Outgo (Rs.) 1085470/- 934830/-

DISCLOSURE UNDER THE PREVENTION OF SEXUAL HARRASSMENT ACT 2013

There was no complaint reported under the Prevention of Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013.

ACKNOWLEDGMENT

Your Directors place on record their appreciation for the assistance and supportextended by all Government Authorities Financial Institutions Banks ConsultantsSolicitors and Members of the Company. The Directors express their appreciation for thededicated and sincere services rendered by the employees of the Company.

For and on behalf of the Board of Directors
Nandan Damani
Chairman and Managing Director
Mumbai 1 4th May 2018