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Sobhagya Mercantile Ltd.

BSE: 512014 Sector: Financials
NSE: N.A. ISIN Code: INE754D01018
BSE 00:00 | 12 May Sobhagya Mercantile Ltd
NSE 05:30 | 01 Jan Sobhagya Mercantile Ltd
OPEN 1.80
PREVIOUS CLOSE 1.80
VOLUME 1
52-Week high 1.80
52-Week low 1.64
P/E 0.00
Mkt Cap.(Rs cr) 0
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 1.80
CLOSE 1.80
VOLUME 1
52-Week high 1.80
52-Week low 1.64
P/E 0.00
Mkt Cap.(Rs cr) 0
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Sobhagya Mercantile Ltd. (SOBHAGYAMERCANT) - Director Report

Company director report

To

The Members

Sobhaygya Mercantile Limited.

The Board of Directors hereby submits the report of the business and operations of yourCompany (‘the Company' or ‘Sobhaygya') along with the audited "Financialstatement for the "Fiscal Year ended March 31 2019.

1. Financial summary/highlights:

The performance during the period ended 31st March 2019 has been as under:

(Amount in Rs.)
Particulars 2018-19 2017-18
Total Income 401400 407210
Total Expenditure 838065 532410
Profit Before Tax And Depreciation (436665) (162510)
Less: Depreciation - -
Profit/(Loss) before tax (436665) (162510)
Less: Tax - -
Profit/(Loss) after tax (436665) (162510)
Add/Less Other Comprehensive Income (175027) 74885
Add: Balance Brought forward from previous year - -
Profit/Loss and other Comprehensive income during the year (611692) (87625)

2. Overview & state of the company's affairs:

During the year under review the Company has recorded an income of Rs. 401400 andLoss of Rs. (611692) as against the income of Rs. 407210 and loss of Rs. (87625) inthe previous financial year ending 31.03.2018.

The Company is looking forward for good profit margins in near future.

3. Dividend:

Since the Company is loss making Company your Directors have decided not to recommenddividend for the year.

4. Transfer to reserves:

Pursuant to provisions of Section 134(3)(j) of the Companies Act 2013 the company hastransferred loss of Rs. (175027) to general reserves account of the company during theyear under review.

5. Material changes & commitment affecting the financial position of thecompany :

During the period under review following are the material changes and commitmentsaffecting the financial position of the Company have been occurred between the end of thefinancial year and the date of this report:-

A. The promoters and promoter group has entered into Share Purchase Agreement with thenew Management and has issued Public Announcement dated 14th June 2019 foracquisition of 34.51% shareholding of the promoters and promoter group by the NewManagement i.e. Mr. Shrikant Bhangdiya Mrs. Aarti Bhangdiya Mrs. Megha Bhangdiya Mrs.Sonal Bhangdiya and Mrs. Manisha Maniyar. The said acquisition has been intimated andinformed to all the stakeholders of the Company which includes SEBI BSE Target Companyetc.

B. Board of Directors have approved the following appointments and Resignations ofDirectors and KMP in their Meeting held on 09th August 2019:-

Appointment:-

a) Shrikant Bhangdiya

b) Devanshu Bansal

c) Sonal Bhangdiya

Resignation:-

a) Machhindranath Krishna Patil Wholetime Director

b) Brijmohan Kabra Independent Director

a) Sadashiv Waman Mungale Independent Director

b) Ramaswamy Ramakrishnan Chandrasekharapuram CFO(KMP)

C. Board of Directors have also approved the shifting of Registered office from25 & 26 1ST Floor AC Market Building Tardeo Mumbai Mumbai City 400034to B-61 Floor 6 Plot

No 210 B Wing Mittal Tower Free Press Journal Marg Nariman Point Mumbai Mumbai City400021 in their Meeting held on 09th August 2019.

6. Significant & material orders passed by the regulators or courts or tribunals:

No significant or material orders have been passed against the Company by theRegulators Courts or Tribunals which impacts the going concern status and company'soperations in future.

7. Transfer of un-claimed dividend to Investor Education and Protection:

There is no such amount of Un-paid or Unclaimed Dividend be transferred to Investor andEducation and Protection Fund for the financial year ended 31st March 2019.

8. Revision of financial statements:

There was no revision of the financial statements for the year under review.

9. Change in the nature of business if any:

During the year under review there was no change in the nature of Business.

However by virtue of the experience of New Management pertaining to large scaleInfrastructure Sector motivate them to change the existing main object of the Company fromTrading Business Activities and to diversify into Infrastructure and Real Estate business.Accordingly the Board decided to replace the existing Clauses from the Main Object Clauseof the Company.

Accordingly Your Board has approved the Notice of Postal Ballot under Section 110 ofCompanies Act 2013 read with the Companies (Management and Administration) Rules 2014for Alteration of Main Object Clause of Memorandum of Association of the Company and TheNotice together with Postal Ballot form seeking consent of members through postal ballotincluding voting by electronic means (e-voting) have been dispatched to the Members whosenames appear in the Register of Members/ Beneficial owners as on the cut-off date i.e.23/08/2019. The Detail instruction and information relating to voting including e-votingare set out in the postal ballot paper sent to the members. The Company has completeddispatch of the postal ballot paper on 31/08/2019.

Further There were no other changes in the nature of the business of the company.

10. Deposits from public:

Your Company has not accepted any deposits from public and as such no amount onaccount of principal or interest on deposits from public was outstanding as on the date ofthe balance sheet.

Pursuant to the Ministry of Corporate Affairs (MCA) notification dated 22ndJanuary 2019 amending the Companies (Acceptance of Deposits) Rules 2014 the Company isrequired to file with the Registrar of Companies (ROC) requisite returns in Form DPT-3 foroutstanding receipt of money/loan by the Company which is not considered as deposits.

The Company would be complying with this requirement within the prescribed timelines.

11. Depository System:

SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015 mandate thatthe transfer except transmission and transposition of securities shall be carried out indematerialized form only with effect from 1st April 2019. In view of thenumerous advantages offered by the Depository system as well as to avoid frauds membersholding shares in physical mode are advised to avail of the facility of dematerializationfrom either of the depositories. The Company has directly as well as through its RTAsent intimation to shareholders who are holding shares in physical form advising them toget the shares dematerialized.

12. Subsidiary companies:

Your Company has no subsidiaries as on March 31 2019.

13. Selection and procedure for nomination and appointment of directors:

The Company has a Nomination and Remuneration Committee ("NRC") which isresponsible for developing competency requirements for the Board based on the industryand strategy of the Company. The Board composition analysis reflects an in-depthunderstanding of the Company including its strategies environment operations andfinancial condition and compliance requirements.

The NRC makes recommendations to the Board in regard to appointment of new Directorsand Key Managerial Personnel ("KMP") and senior management. The role of the NRCencompasses conducting a gap analysis to refresh the Board on a periodic basis includingeach time a Director's appointment or re-appointment is required. The NRC is alsoresponsible for reviewing the profiles of potential candidates' vis--vis the requiredcompetencies; undertake a reference and due diligence and meeting of potential candidatesprior to making recommendations of their nomination to the Board.

The appointee is also briefed about the specific requirements for the positionincluding expert knowledge expected at the time of appointment.

14. Criteria for determining qualifications positive attributes and independence of adirector:

In terms of the provisions of Section 178(3) of the Act and Regulation 19 of theListing Regulations the NRC has formulated the criteria for determining qualificationspositive attributes and independence of Directors the key features of which are asfollows:

Qualifications – The Board nomination process encourages diversity of thoughtexperience knowledge age and gender. It also ensures that the Board has an appropriateblend of functional and industry expertise.

Positive Attributes - Apart from the duties of Directors as prescribed in the Actthe Directors are expected to demonstrate high standards of ethical behaviourcommunication skills and independent judgment. The Directors are also expected to abide bythe respective Code of Conduct as applicable to them.

Independence - A Director will be considered independent if he / she meets thecriteria laid down in Section 149(6) of the Act the Rules framed thereunder andRegulation 16(1)(b) of the Listing Regulations.

15. Training of Independent Directors:

Your Company's Independent Directors are highly qualified and have been associated withcorporate and business organizations. They understand Company's business and activitiesvery well however pursuant to Regulation 4 of the Listing Regulations the Board hasshown all the Independent Directors Company's business and activities and were alsointroduced to Company's staff.

16. Independent director's familiarization programmes:

The familiarization program aims to provide the Independent Directors with the scenariowithin the Companies Business Activity the socio-economic environment in which theCompany operates the business model the operational and financial performance of theCompany significant development so as to enable them to take well-informed decisions intimely manner. The familiarization programme also seeks to update the Directors on theroles responsibilities rights and duties under the Act and other statutes. The policy onCompany's familiarization programme for Independent Directors is hosted on your Company'swebsite and its web link is https://www.sobhagyamercantile.com.

17. Board's performance evaluation:

We conducted a formal Board effectiveness review as part of our efforts to evaluatethe performance of our Board and identify areas that need improvement in order to enhancethe effectiveness of the Board its Committees and Individual Directors. This was in linewith the requirements of the Companies Act 2013 and the Listing Regulations. TheCorporate HR team of company worked directly with the Chairperson and the Nomination andRemuneration Committee of the Board to design and execute this process. It was lateradopted by the Board.

The criteria for Board processes included Board composition strategic orientation andteam dynamics. Evaluation of each of the Board Committees covered whether they havewell-defined objectives and the correct composition and whether they achieved theirobjectives. The criteria for Individual Board Members included skills experience levelof preparedness attendance extent of contribution to Board debates and discussion andhow each Director leveraged their expertise and networks to meaningfully contribute to theCompany. The criteria for the Chairperson's evaluation included leadership style andconduct of Board meetings. The performance evaluation criteria for Independent Directorsincluded a check on their fulfilment of the independence criteria and their independencefrom the management.

18. FORMAL ANNUAL EVALUATION:

As per section 149 of the Companies Act 2013 read with clause VII (1) of the scheduleIV and rules made thereunder and regulation 25(7) of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the independent directors of the company had ameeting on 25/03/2019 without attendance of non-independent directors and members ofmanagement.

In the meeting the following issues were taken up:

a) Review of the performance of non-independent directors and the Board as a whole;

b) Review of the performance of the Chairperson of the company taking into account theviews of executive directors and non-executive directors;

c) Assessing the quality quantity and timeliness of flow of information between thecompany management and the Board that is necessary for the Board to effectively andreasonably perform their duties.

The meeting also reviewed and evaluated the performance of non-independent directors.

19. Managerial Remuneration and particulars of employees

During the year under review the Company has not given Remuneration to the Directors ofthe Company. Accordingly Information pursuant to Rule 5(1) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 is not required to be annexed tothis report.

Further As The Company did not employ any such person whose particulars are requiredto be given under Rule 5(2) and (3) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 pertaining to the top ten names and other particulars ofemployees disclosure as per said provisions is not required to be annexed to this report.

20. Number of Board the Meetings:

During the year Four (4) meetings of the Board of Directors of the Company were dulyconvened viz. 26/05/2018 31/07/2018 31/10/2018 and 31/01/2019 and held in accordancewith the provisions of the Act. The maximum time gap between any two meetings was lessthan 120 days. The agenda for each meeting is prepared well in advance along withexplanatory notes wherever required and distributed to all Directors.

Attendance and directorships held:

The names and categories of the Directors on the Board their attendance at Boardmeeting during the year and at last Annual General Meeting as also the number ofDirectorships and Committee memberships held by them in other companies are shown below:-

The date(s) of the Board Meeting attendance by the directors are given below:-

Sr. No. Name Category Designation No. of Meetings Whether attended Last AGM
Held Attended
1 Mr. Brijmohan Kabra Independent Non-Executive Chairman 4 4 Yes
2 Mr. Machhindranath Patil Whole Time Director Member 4 2 Yes
3 Mrs. Suvarna Shinde Independent Non-Executive Member 4 2 Yes
4 Mr. Sadashiv Waman Mungale Independent Non-Executive Member 4 0 No
5 Mr. Kaushal Mehta Independent Non-Executive Member 4 2 NA
6 Mrs. Snehlata Gupta Independent Non-Executive Member 4 2 NA

*Mr. Kaushal Mehta and Mrs. Snehlata Gupta resigned w.e.f. 31.07.2018

21. Committees of the Board

In compliance with the provisions of Sections 177 178 of the Act the Boardconstituted Audit Committee Nomination and Remuneration Committee and StakeholdersRelationship Committee (Committees). The details of composition of the Committees theirmeeting and attendance of the members are given below:-

A. Audit Committee

The Board of Directors has constituted an Audit Committee and empowered the committeeto deal with all such matters which it may consider appropriate to perform as auditcommittee including items specified in Section 177(4) of the Companies Act 2013 (as maybe modified/amended from time to time) and such matters as may be assigned from time totime by the Board of Directors. The details of composition meetings and attendance of theMeetings of the Audit Committee are as under:-

Sr. No. Name Category Designation No. of Meetings
Held Attended
1 Mr. Brijmohan Kabra Independent Non-Executive Chairman 4 4
2 Mr. Machhindranath Patil Whole Time Director Member 4 2
3 Mrs. Suvarna Shinde Independent Non-Executive Member 4 2
4 Mr. Sadashiv Waman Mungale Independent Non-Executive Member 4 0
5 Mr. Kaushal Mehta Independent Non-Executive Member 4 2
6 Mrs. Snehlata Gupta Independent Non-Executive Member 4 2

*Mr. Kaushal Mehta and Mrs. Snehlata Gupta resigned w.e.f. 31.07.2018

There have been no instances of non acceptance of any recommendations of the AuditCommittee by the Board during the financial year under review.

B. Nomination And Remuneration Committee

The Board constituted Nomination and Remuneration committee. The Committee hasformulated a Nomination and Remuneration Policy. The details of composition meetings andattendance of the Meetings of the Nomination and Remuneration committee are as under:-

Sr. No. Name Category Designation No. of Meetings
Held Attended
1 Mr. Brijmohan Kabra Independent Non- Executive Chairman 4 4
2 Mr. Machhindranath Patil Whole Time Director Member 4 2
3 Mrs. Suvarna Shinde Independent Non- Executive Member 4 2
4 Mr. Sadashiv Waman Mungale Independent Non- Executive Member 4 0
5 Mr. Kaushal Mehta Independent Non- Executive Member 4 2
6 Mrs. Snehlata Gupta Independent Non- Executive Member 4 2

*Mr. Kaushal Mehta and Mrs. Snehlata Gupta resigned w.e.f. 31.07.2018

A separate meeting of Independent Directors pursuant to Section 149(7) read withSchedule VI of the Companies Act 2013 and Regulation 25 of the Listing Regulations washeld on 25/03/2019.

22. DETAILS ON GENERAL BODY MEETINGS:

a) Location date and time of last three AGMS and special resolutions there at asunder:

Financial Year Date Time Location Special Resolution Passed
2017-18 29/09/ 2018 12.30 pm 1/25 & 1/26 1st Floor Tardeo Airconditioned Market Society Tardeo Road Mumbai - 400 034 No special resolution Passed
2016-17 29/09/2017 12.30 pm 1/25 & 1/26 1st Floor Tardeo Airconditioned Market Society Tardeo Road Mumbai - 400 034 No special resolution Passed
2015-16 30/09/2016 12.30 pm 1/25 & 1/26 1st Floor Tardeo Airconditioned Market Society Tardeo Road Mumbai - 400 034 No special resolution Passed

b) PASSING OF RESOLUTIONS BY POSTAL BALLOT

There were no resolutions passed by the Company through Postal Ballot during theFinancial year 2018-19.

23. Directors and key managerial personnel:

As on date of this report the Company has four Directors out of those Two areIndependent Directors including one Woman Independent Director.

a) Re-Appointment/ Appointment of Directors of the Company:

(i) Disclosure pursuant to Regulation 36(3) of the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 ("ListingRegulations") with respect to Directors seeking re-appointment/appointment at theMeeting is given below:

Details of Director seeking re-appointment at the 35th Annual GeneralMeeting

Name of Director Mr. Shrikant Bhangdiya Mrs. Sonal Bhangdiya Mr. Devanshu Bansal
DIN 02628216 03416775 03387069
Date of Birth 14/04/1984 08/12/1981 12/09/1992

 

Qualification Nationality Indian Indian Indian
Date of First Appointment on board 09.08.2019 09.08.2019 09.08.2019
Terms and conditions of appointment or reappointment Appointed as Executive Director for a period of five (5) years not liable to retire by rotation Non-Executive Director for a period of five (5) years not liable to retire by rotation Non-Executive Independent Director for a period of five (5) years not liable to retire by rotation
Directorship in other Companies Appointed as director in 18 Other Companies NIL Appointed as director in 14 Other Companies

b) Key Managerial Personnel:

During the Year under review following Key Managerial Personnel (KMP) has beenappointed and resigned from the post of KMP

Sr. No. Name of KMP Designation Date of Appointment Date of Cessation
1. Machhindranath Patil Wholetime Director 31/07/2018 09/08/2019
2. Pradeep Soni Company Secretary 01/10/2018 NIL
3. Ramaswamy Ramakrishnan Chandrasekharapuram CFO(KMP) 22/04/2019 09/08/2019

24. Statutory Auditors :

M/s. BSVM & Associates are appointed as Statutory Auditor of your Company in placeof Vijay R. Tater & Co. Chartered Accountants to hold office until the conclusion ofthe 35th AGM to be held in the year 2019 until the conclusion of 40th Annual GeneralMeeting subject to ratification of their appointment at every AGM. The Members year onyear will be requested to ratify their appointment as Auditors and to authorise theBoard of Directors to fix their remuneration. The Audit committee and Board of directorsrecommend the ratification of their appointment in the forthcoming annual general meeting.

The Auditors have confirmed that they have subjected themselves to the peer reviewprocess of Institute of Chartered Accountants of India (ICAI) and hold valid certificateissued by the Peer Review Board of the ICAI.

25. Internal auditors:

Pursuant to provisions of Section 138 read with Rule 13 of the Companies (Accounts)Rules 2014 and Section 179 read with Rule 8(4) of the Companies (Meetings of Board andits Powers) Rules 2014; M/s. MOK and Associates Chartered Accountants (Firm RegistrationNo. 115685W) were appointed as Internal Auditors of the Company for the Financial Year2018-19.

Deviations are reviewed periodically and due compliance ensured. Summary of SignificantAudit Observations along with recommendations and its implementations are reviewed by theAudit Committee and concerns if any are reported to Board.

26. Secretarial auditors:

In terms of section 204 of the Companies Act 2013 read with the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 based upon the recommendations ofthe Audit Committee the Board of Directors had appointed M/s. Dipti ChandratrePracticing Company Secretaries as the Secretarial Auditor of the Company for conductingthe Secretarial Audit for financial year ended March 31 2019

The Board of Directors of the Company appointed M/s. Parag Dasarwar Practicing CompanySecretaries to conduct the Secretarial Audit as per Rule 9 of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 prescribed under Section 204 of theCompanies Act 2013 for the financial year 2019-2020.

27. Audit reports:

Explanations or comments by the Board on every qualification reservation or adverseremark or disclaimer made if any —

(a) Statutory Auditors Report:

The Board has duly reviewed the Statutory Auditor's Report on the Accounts for the yearended March 31 2019 and has noted that the same does not have any reservationqualification or adverse remarks. However the Board decided to further strengthen theexisting system and procedures to meet all kinds of challenges and growth in the marketexpected in view of the rapid global challenges.

The Auditors Report annexed with this Annual Report does not contain anyqualification reservation or adverse remarks.

(b) Secretarial Audit Report:

The Secretarial Audit was carried out by M/s. Dipti Chandratre Practicing CompanySecretaries for the financial year ended March 31 2019. The Report given by theSecretarial Auditor is annexed herewith and forms integral part of this Report.

The Secretarial Compliance Report for the financial year ended 31st March2019 in relation to compliance of all applicable SEBI Regulations/circulars/ guidelinesissued thereunder pursuant to requirement of Regulation 24A of Listing Regulations is setout in Annexure II to this report.

The Secretarial Audit Report does not contain any qualification reservation or adverseremark.

28. No Frauds reported by statutory auditors

During the Financial Year 2018-19 the Auditors have not reported any matter undersection 143(12) of the Companies Act 2013 therefore no detail is required to bedisclosed under section 134(3)(ca) of the Companies Act 2013.

29. Conservation of energy technology absorption and foreign exchange outgo:

The required information as per Sec.134 (3) (m) of the Companies Act 2013 is providedhereunder and Rule 8 of Companies (Accounts) Rules 2014:

A. Conservation of Energy:

Your Company's operations are not energy intensive. Adequate measures have been takento conserve energy wherever possible by using energy efficient computers and purchase ofenergy efficient equipment.

B. Technology Absorption:

1. Research and Development (R&D): NIL

2. Technology absorption adoption and innovation: NIL

C. Foreign Exchange Earnings and Out Go:

1. Foreign Exchange Earnings: Nil

2. Foreign Exchange Outgo: Nil

30. Management discussion and analysis report:

Management discussion and analysis report for the year under review as stipulated underRegulation 34 (e ) read with schedule V Part B of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 is presented in a separate section formingpart of the annual report.

31. Risk management policy:

The Board of Directors had constituted Risk Management Committee to identify elementsof risk in different areas of operations and to develop policy for actions associated tomitigate the risks. The Committee is responsible for reviewing the risk management planand ensuring its effectiveness. The major risks identified by the businesses and functionsare systematically addressed through mitigating actions on a continual basis.

32. Corporate governance:

During the Year under review pursuant to the Provisions of Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015Corporate Governance is not applicable to the company since the paid up equity sharecapital and net worth of the company does not exceed Rs. 10 crores and Rs. 25 croresrespectively.

33. Code of Conduct for Prevention of Insider Trading :

The Board of Directors has adopted the Insider Trading Policy in accordance with theRequirements of the SEBI (Prohibition of Insider Trading) Regulation 2015. The InsiderTrading Policy of the Company lays down guidelines and procedures to be followed anddisclosures to be made while dealing with shares of the Company. The policy has beenformulated to protect the interest of shareholders at large and to prevent misuse of anyunpublished price sensitive information and to prevent any insider trading activity bydealing in shares of the Company by its Directors Designated Persons Employees and theirimmediate relatives and to maintain the highest ethical standards of dealing in Companysecurities.

The Insider Trading Policy of the Company covering code of practices and procedures forfair disclosure of unpublished price sensitive information and code of conduct for theprevention of insider trading is available on our website www.sobhagyamercantile.com.

34. Extract of Annual Return:

As provided under section 92(3) of the Companies Act 2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 the extract of annual return underform MGT 9 is annexed herewith as Annexure- I to this report.

35. Authorised and paid up capital of the company:

During the year under review The authorized capital of the company stands at Rs.2500000/- divided into 250000 equity shares of Rs.10/- each. The company's paid upcapital is Rs. 2400000/- divided into 240000 equity shares of Rs. 10/- each.

36. Declaration of independence:

The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet with criteria of independence as prescribed both undersub-section (6) of Section 149 of the Companies Act 2013 and under Regulation 16(1)(b)read with Regulation 25 of the Listing Regulations.

During the year Independent Directors of the Company had no pecuniary relationship ortransactions with the Company other than sitting fees commission and reimbursement ofexpenses incurred by them for the purpose of attending meetings of the Board of Directorsand Committee(s).

37. Policy on Directors appointment and Remuneration and other details:

The Board Governance Nomination & Compensation Committee has framed a policy forselection and appointment of Directors including determining qualifications andindependence of a Director Key Managerial Personnel (KMP) senior management personneland their remuneration as part of its charter and other matters provided under Section178(3) of the Companies Act 2013.

Pursuant to Section 134(3) of the Companies Act 2013the nomination and remunerationpolicy of the Company which lays down the criteria for determining qualificationscompetencies positive attributes and independence for appointment of Directors andpolicies of the Company relating to remuneration of Directors KMP and other employees isavailable on the Company's website at www.sobhagyamercantile.com.

During the year under review the Company has not paid remuneration to the Directors.

38. Director's Responsibility Statement:

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

a) in the preparation of the annual accounts for the financial year ended 31 March2019 the applicable accounting standards and schedule III of the Companies Act 2013 havebeen followed and there are no material departures from the same;

b) 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 your Company as on 31 March 2019 and of the loss ofthe Company for the financial year ended 31 March 2019;

c) proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

d) The annual accounts have been prepared on a going concern basis;

e) Proper internal financial controls laid down by the Directors were followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and

f) Proper systems to ensure compliance with the provisions of all applicable laws werefollowed and that such systems were adequate and operating effectively.

39. Vigil Mechanism/Whistle Blower Policy:

The Board of Directors has formulated a Vigil Mechanism Policy which is in compliancewith the provisions of Section 177(10) of the Companies Act 2013 and Regulation 22 of theListing Regulations. The Company has a vigil mechanism to deal with fraud andmismanagement if any. The policy is on the website of the Company.

The policy provides for adequate safeguards against the victimisation of the employeeswho use the vigil mechanism. The vigil mechanism is overseen by the audit Committee.

40. Employee stock option scheme:

The Company has not issued any equity shares under Employees Stock Option Scheme duringthe year under review and hence no information as per provisions of Section 62(1)(b) ofthe Act read with Rule 12(9) of the Companies (Share Capital and Debenture) Rules 2014.

41. Corporate social responsibility policy:

Since your Company does not have net worth of Rs. 500 Crore or more or turnover of Rs.1000 Crore or more or a net profit of Rs. 5 Crore or more during the financial yearsection 135 of the Companies Act 2013 relating to Corporate Social Responsibility is notapplicable and hence the Company need not adopt any Corporate Social ResponsibilityPolicy.

42. Secretarial Standards:

The company is in compliance with Secretarial Standards issued by The Institute ofCompany Secretaries of India on Meetings of the Board of Directors and General Meetings.

43. Insurance:

The properties and assets of your Company are adequately insured.

44. Particulars of loans guarantees:

The Company has not availed any facilities of Credit and Guarantee from the Bank/Financial Institutions etc.

45. Internal Financial Control Systems:

Your Company has well laid out policies on financial reporting asset managementadherence to Management policies and also on promoting compliance of ethical and welldefined standards. The Company follows an exhaustive budgetary control and standardcosting system. Moreover the management team regularly meets to monitor goals and resultsand scrutinizes reasons for deviations in order to take necessary corrective steps. TheAudit Committee which meets at regular intervals also reviews the internal control systemswith the Management and the internal auditors.

The internal audit is conducted at the Company and covers all key areas. All auditobservations and follow up actions are discussed with the Management as also the StatutoryAuditors and the Audit Committee reviews them regularly.

46. Related Party Transactions:

All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of business. During the financial year2018-19 there were no related party transactions made by the Company with PromotersDirectors Key Managerial Personnel or other designated persons which may have a potentialconflict with the interest of the Company at large.

The Form AOC-2 pursuant to Section 134(3)(h) of the Companies Act 2013 read with Rule8(2) of the Companies (Accounts) Rules 2014 is is annexed herewith as Annexure- IIIto this report.

47. Particulars of employees and remuneration:

Your Directors are pleased to record their sincere appreciation of the contribution bythe staff at all levels in the improved performance of the Company.

None of the employees is drawing Rs. 850000/- per month and above or Rs.10200000/- per annum and above in aggregate the limits prescribed under Section 134 ofthe Companies Act 2013.

48. Non-executive directors' compensation and disclosures:

None of the Independent / Non-Executive Directors has any pecuniary relationship ortransactions with the Company which in the Judgment of the Board may affect theindependence of the Directors.

49. Industry based disclosures as mandated by the respective laws governing thecompany:

The Company is not a NBFC Housing Companies etc. and hence Industry based disclosuresis not required.

50. CEO/CFO Certification:

The provision of Regulation 17(8) read with Schedule II of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the CEO/CFO certification isnot applicable to the Company.

51. Prevention of sexual harassment at workplace:

The Company has zero tolerance for sexual harassment at workplace and has adopted aPolicy on Prevention Prohibition and Redressal of Sexual Harassment at workplace.

This is in line with provisions of the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 (‘POSH Act') and the Rules madethereunder. With the objective of providing a safe working environment all employees(permanent contractual temporary trainees) are covered under this Policy. The policy isavailable on the website at www.sobhagyamercantile.com.

As per the requirement of the POSH Act and Rules made thereunder the Company hasconstituted an Internal Committee at all its locations known as the Prevention of SexualHarassment (POSH) Committees to inquire and redress complaints received regarding sexualharassment. During the year under review there were no Complaints pertaining to sexualharassment.

52. Details of Complaints/Requests Received Resolved And Pending During The Year2018-19:

a. Number of complaints received from the investors comprising non-receipt of securities sent for transfer and transmission complaints received from:- NIL
b. SEBI / Registrar of Companies / Bombay Stock Exchange / National:- NIL
c. Stock Exchange / SCORE and so on:- NIL
d. Number of complaints resolved:- NA
e. Number of complaints not resolved to the satisfaction of the investors as on March 31 2019:- NIL
f. Complaints pending as on March 31 2019:- NIL
g. Number of Share transfers pending for approval as on March 31 2019:- NIL

53. Other Disclosures:

There were no instances of material noncompliance nor have any penalties/stricturesimposed by Stock Exchanges or SEBI or any other statutory authority on any matters relatedto capital market during last 3 financial years.

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:

a. Issue of equity shares with differential rights as to dividend voting or otherwise.

b. Issue of shares (including sweat equity shares) to employees of the Company underany scheme save and except ESOS referred to in this Report.

c. Neither the Managing Director nor the Whole-time Directors of the Company receiveany remuneration or commission from any of its subsidiaries.

54. Appreciation & acknowledgement:

Your Directors place on record their appreciation for the overwhelming co-operation andassistance received from the investors customers business associates bankers vendorsas well as regulatory and governmental authorities. Your Directors also thanks theemployees at all levels who through their dedication co-operation support and smartwork have enabled the company to achieve a moderate growth and is determined to poise arapid and remarkable growth in the year to come.

Your Directors also wish to place on record their appreciation of businessconstituents banks and other "financial institutions and shareholders of the Companylike SEBI BSE NSDL and etc. for their continued support for the growth of the Company.

For and on behalf of the Board of
Sobhaygya Mercantile Limited
Sd/- Sd/-
Shrikant Bhangdiya Devanshu Bansal
Place: Mumbai Director Director
Date: 24/08/2019 (DIN: 02628216) (DIN: 03387069)

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