Sri Amarnath Finance Ltd.
|BSE: 538863||Sector: Financials|
|NSE: N.A.||ISIN Code: INE985Q01010|
|BSE 05:30 | 01 Jan||Sri Amarnath Finance Ltd|
|NSE 05:30 | 01 Jan||Sri Amarnath Finance Ltd|
|BSE: 538863||Sector: Financials|
|NSE: N.A.||ISIN Code: INE985Q01010|
|BSE 05:30 | 01 Jan||Sri Amarnath Finance Ltd|
|NSE 05:30 | 01 Jan||Sri Amarnath Finance Ltd|
The Members of
Sri Amamath Finance Limited
Your Directors are pleased to present their Thirty Fourth Report of the Companytogether with the audited financial statements for the Financial Year ended on March 312019.
The performance highlights and summarized financial results of the Company are givenbelow:
. INFORMATION ON STATUS OF AFFAIRS OF THE COMPANY
? Income from operation for the year was र 4.78 Crores as compared to र 4.48 Crores in 2017-18 a growth of 6%
? Profit Before Tax for the year was र 3.91 Crores as compared to र 1.18in 2017-18 a growth of 233%
? Profit After Tax for the year was र 2.80 Crores as compared to र 82.42Lakh in 2017-18 a growth of 240%
The Company did not recommend any dividend for the year.
3. TRANSFER TO RESERVES
During the year under review your Company has transferred a sum of र 5604919/- to the reserves from the profits of the Company in accordance with theprovisions of section 45IC of the Reserve Bank of India.
4. CHANGE IN THE NATURE OF BUSINESS
There is no change in the nature of the business of the Company during the financialyear 2018-19.
5. NAME OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES JOINT VENTURESOR ASSOCIATE COMPANIES DURING THE YEAR
Your Company does not have any subsidiary joint Venture or associate Company
6. DETAILS OF DEPOSITS COVERED UNDER CHAPTER V OF COMPANIES ACT 2013
Your Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014 and as such noamount on account of principal or interest on public deposits was outstanding as on thedate of the Balance Sheet.
As of the end of March 31 2019 an amount of NIL matured deposits remained unclaimed.
7. RBI GUIDELINES:
The company continues to fulfill all the norms and standards laid down by the ReserveBank of India for the Non Banking Financial Company.
8. NBFC REGISTRATION
The Company has been registered with Reserve bank of India as Non Banking FinanceCompany vides registration no. B-14.01224 dated 4th January 2003
9. CREDIT RATING
The directors of the Company are happy to report that the company get its membershipcertificate from all CICs i.e. Credit Information Bureau (India) Limited (CBIL) EquifaxCredit Information Services Private Limited (ECIS) Experian Credit Information Company ofIndia Private Limited CRIF High Mark Credit Information Services Private Limited. A soundrating/upgrade in a challenged business environment speaks volumes about the Company'sperformance and its systems & processes.
10. EXPOSURE TO REAL ESTATE:
The following are details of loan provided to the companies engaged in real estatebusiness during the financial year 2018-19:
11. DEMATERIALIZATION OF SHARES :
The Company has connectivity with NSDL & CDSL for dematerialization of its equityshares. The ISIN No INE985Q01010 has been allotted for the company. Therefore theinvestors may keep their shareholding in the electronic mode with their depositoryParticipant. 67.99% of the Company's paid-up Share Capital is in dematerialized form as on31stMarch 2019 and balance 32.01% in physical form.
12. THE DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVERESIGNED DURING THE YEAR
Mर Nishi Seth (DIN^Ol 101809)Non-Executive & Non-Independent Director ofthe Company who retires by rotation in accordance with the provisions of Section 152 ofthe Companies Act 2013 at the ensuing Annual General Meeting and being eligible offersherself for reappointment. The detailed profile of Mर Nishi Seth has been includedin the Notice convening the ensuing AGM.
Ms. Pooja Bedi (DIN: 0008193642) was inducted as an additional director on 14th August2018 and the Board in its meeting held on 14th August 2018 has recommended the appointmentof Ms. Pooja Bedi (DIN: 0008193642) as Independent Director for a term of five years from14th August 2018 to 13th August 2023 and shareholders approved the appointment of Ms.Pooja Bedi as an Independent Director at the 33rdAnnual General Meeting was held on 25thSeptember 2018.
Ms. Harlin Arora (DIN: 0008193621) was inducted as an additional director on 14thAugust 2018 and the Board in its meeting held on 14th August 2018 has recommended theappointment of Ms. Harlin Arora (DIN: 0008193621) as Independent Director for a term offive years from 14th August 2018 to 13th August 2023 and shareholders approved theappointment of Ms. Harlin Arora as an Independent Director at the 33rdAnnual GeneralMeeting was held on 25th September 2018.
Mr. Surendra Kumar Jain has tendered his resignation from position of the Director ofthe Company with effect from 13.08.2018 and the same has been filed with the ROC.
Mर Priti Jain has tendered her resignation from position of the ManagingDirector of the Company with effect from 13.08.2018 and the same has been filed with theROC.
Mr. Rakesh Kapoor Director of the company designated as Managing Director of thecompany by the board of directors in their board meeting held on 14.08.2018 for the termof five years starting from 14th August 2018 to 13th August 2023 and same has beenapproved by the shareholders in their 33rd Annual General Meeting held on 25th September2019.
Mr. Sujan Mal Mehta has tendered his resignation from position of the IndependentDirector of the Company with effect from 05.12.2018 and the same has been filed with theROC.
Mr. Rajesh Singal has tendered his resignation from position of the IndependentDirector of the Company with effect from 07.12.2018 and the same has been filed with theROC.
Ms. Bhawana Tuli has tendered her resignation from the post of Company Secretary &Compliance officer of the Company with effect from 15.12.2018 and in place the board ofdirectors appointed Ms. Nidhi Jain as Company Secretary & Compliance officer of thecompany with effect from 12.02.2019.
The Company has received consent in writing to act as directors in Form DIR-2 andintimation in Form DIR-8 pursuant to Rule 8 of the Companies (Appointment andQualification of Directors) Rules 2014 to the effect that they are not disqualifiedunder section (2) of section 164 of the Companies Act 2013. The Board considers that hisassociation would be immense benefit to the Company and it is desirable to avail hisservices as Directoर
13. DIRECTORS* RESPONSIBILITY STATEMENT
Pursuant to the provisions contained in Section 134 (5) of the Companies Act 2013Your Directors confirm that:
i) In the preparation of the annual accounts for the financial year ended on March 312019 the applicable Accounting Standards have been followed and there are no materialdepartures from the same;
ii) The selected accounting policies were applied consistently and the Directors madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company as at March 31 2019 and of the profit of theCompany for that period.
iii) Proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities!
iv) The annual accounts have been prepared on a 'going concern' basis.
v) The Internal financial controls have been laid by the Directors to be followed bythe Company and such financial controls are adequate and were operating effectively.
vi) Proper systems had been devised in compliance with the provision of the allapplicable laws and such systems were adequate and operating effectively.
14. EXTRACT OF ANNUAL RETURN
The extract of annual return in Form MGT-9 as on March 31 2019 is attached asAnnexure-A to this Report.
15. CORPORATE GOVERNANCE REPORT
Your Company has been practicing the principles of good Corporate Governance over theyears and it is a continuous and ongoing process. A report on the Corporate Governance asrequired under Regulation 24 34(3) and 54(0 read with Schedule V of Securities ExchangeBoard of India (Listing Obligation and Disclosure Requirements) Regulations 2015 is givenin this Report as Annexure-B.
Details on number of Meetings of Board and Committees and composition of variousCommittees of the Board including their Terms of Reference are in the annexed CorporateGovernance Report.
16. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report as required under the SEBI (ListingObligations and Disclosure Requirements) regulations 2015 is annexed as Annexure-C andforms part of the Directors' Report.
17. NUMBER OF MEETINGS OF THE BOARD
During the year Seven (7) meetings of the Board of Directors were held. For furtherdetails please refer Report on Corporate Governance.
18. DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUB-SECTION (12) OF SECTION143 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT.
During the year under consideration Statutory Auditor and Secretarial Auditor have notreported any instances of frauds committed in the Company under section 143(12) of theCompanies Act 2013.
19. INDEPENDENT DIRECTORS DECLARATION
Presently the Company has three Independent Directors namely Mr. Rajesh Sabharwal Ms.Pooja Bedi and Ms. Harlin Arora who have given declaration that they meet the eligibilitycriteria of independence as provided in sub-section (6) of Section 149 of Companies Act2013. For further details please refer Annexure-D of Report on Corporate Governance.
20. DISCLOSURE ON THE NOMINATION AND REMUNERATION POLICY OF THE COMPANY PURSUANT TOSECTION 134(3) (e) AND SECTION 178 (3)
The Board of the Directors had framed the policy which lays down a framework inrelation to Remuneration of Directors Key Managerial Personnel and Senior Management ofthe Company. This policy also lays down criteria for selection and appointment of BoardMembeर The Remuneration Policy is disclosed on the Company's websitehttp://www.sriamarnathfinance.in
21. DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM:
In pursuant to the provision of section 177(9) & (10) of the Companies Act 2013the company had formulated a Whistle blower policy to establish a vigil mechanism forDirectors and employees of the Company to report concerns about unethical behavior actualor suspected fraud or violation of the Company' s code of conduct or ethics policy. TheWhistle Blower policy is available on website of the Companyhttp://www.sriamarnathfinance.in
22. AUDITOR AND AUDITOR'S REPORT
M/s Vinod Vishal & Co. Chartered Accountants (Firm Registration No. 09112N) wasappointed as the Statutory Auditor of the Company in the 30th Annual General Meeting tillthe conclusion of 35th Annual General Meeting.
There are no qualifications reservations or adverse remarks or disclaimers made by theM/s Vinod Vishal & Co. Chartered Accountants The Statutory Auditor in their reportfor the Financial Year ending on March 31 2019 under review Auditors' Report is annexedherewith and forms a part of Annual report.
Secretarial Audit of the Company has been undertaken by M/s Abhishek Pathak &Associates a firm of Company Secretaries in Practice. The Report of the Secretarial AuditReport is included as Annexure- E and forms an integral part of this report. SecretarialAudit Report does not contain any qualification reservation or adverse remark.
The Company has appointed M/s. R Garg & Company as an Internal Auditor of theCompany for the financial year 2018-19. M/s. R Garg & Company placed the internalaudit report to the company which is self explanatory and need no comments.
23. EXPLANATION OR COMMENTS ON QUALIFICATIONS RESERVATIONS OR ADVERSE REMARKS ORDISCLAIMERS MADE BY THE STATUTORY AUDITORS AND THE SECRETARIAL AUDITORS IN THEIR REPORTS
There were no qualifications reservations or adverse remarks made by the StatutoryAuditors or Secretarial Auditors in their report.
24. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Details of loans guarantees and investments covered by the provisions of section 186of the Companies Act 2013 are given in the notes to the financial statements.
25. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
The Particulars or arrangements with related parties for the financial year 2018-19 areannexed herewith as "Annexure- F" to the financial statements in form AOC-2. Thedetails of related party disclosures also form part of the notes to the financialstatements.
26. MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THESE FINANCIAL STATEMENTSRELATE AND THE DATE OF THE REPORT
No material changes and commitments affecting the financial position of the Companyoccurred from the end of the Financial Year 2018-19 till the date of this report exceptthat an ex-parte interim order has been passed on 04.06.2018 by Hon'ble National CompanyLaw Tribunal (NCLT) Delhi Bench against the Company restraining the Company fromalienating encumbering or transferring the fixed assets of the Company and alsorestraining the company from operating its bank accounts.
The Company in consultation with its legal counsel took a suitable legal action andapproached NCLT against the said order. On 11.02.2019 Hon'ble National Company LawTribunal (Delhi) vacated all interim ordeर
The matter is pending before Hon'ble National Company Law Tribunal (NCLT) Delhi Benchand is listed for further consideration on 17.10.2019
Further there was no change in the nature of business of the Company.
27. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNING AND OUTGO
The company does not fall under the industries covered by the companies (Accounts)Rules 2014. Hence the requirement of disclosure in relation to the conservation ofenergy technology absorption foreign exchange earnings & outgo are not applicable toit.
28. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OFTHE COMPANY
The assets of the company are adequately insured against the loss of fire riotearthquake terrorism loss of profit etc other risks which considered necessary by themanagement. The company has been addressing the various risks impacting the company andthe policy of the company on Risk Management is provided as part of Management Discussionand Analysis Report which forms part of this Annual Report.
29. CORPORATE SOCIAL RESPONSIBILITY POLICY
The provisions of Section 135 of companies Act 2013 are not applicable on yourCompany.
30. EVALUATION BY BOARD OF ITS OWN PERFORMANCE ITS COMMITTEES AND INDIVIDUAL DIRECTORS
Pursuant to the applicable provisions of the Companies Act 2013 and Regulation 15 ofthe Listing Regulations the Company has devised the policy for performance evaluation ofthe Independent Directors Board Committees and other individual Directors whichincludes criteria for performance evaluation of non-executive directors and executivedirectoर
The evaluation of all the directors and Board as a whole was conducted based on thecriteria and framework adopted by the Board. More details regarding evaluation processhave been provided under Corporate Governance Report which forms part of this AnnualReport.
31. INTERNAL FINANCIAL CONTROLS
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.
32. DISCLOSURE UNDER THE SEXUALHARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
The company has in place an Anti-Sexual Harassment Policy in line with the requirementsof Section 22 and Section 28 of The Sexual Harassment of Woman at the Workplace(Prevention Prohibition and Redressal) Act 2013. Internal Complaint Committee has beenset up to redress complaints received regarding sexual harassment. All employees(permanent contractual temporary trainees) are covered under this policy.
The following is a summary of sexual harassment complaints received and disposed offduring the year 2018-19.
33. HEALTH SAFETY AND ENVIRONMENT PROTECTION
The company has complied with all applicable environmental law and labour laws. TheCompany has been complying with the relevant laws and has been taking all necessarymeasures to protect the environment and maximize worker protection and safety.
34. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
During the period under review there were no significant and material orders passed bythe regulators/ courts or tribunals that would impact going concern status of the Companyand its future operations.
However the Company has in its last Board Report notified its Shareholders that BombayStock Exchange has in compliance with the directions issued by SEBI vide its letter datedAugust 09 2017 has placed trading restriction on the Company by placing the shares inStage VI of the Graded Surveillance Measure (GSM). In this regard the Company would liketo inform its Shareholders that BSE has vide its letter No.SURV/OFL/AB/2017-18/SHELL/COMP/53886/1 dated January 4 2018 removed the said restrictionand has considered imperative and necessary that forensic audit of the company be carriedout and has appointed an independent auditor for the said purpose. The matter is pending.
The Company has in its last Board Report notified its Shareholders that the Company isalso in receipt of notice under section 272(4) of Companies Act 2013 from the office ofRegional Director Northern Region. In this regard the Registrar of Companies Delhi &Haryana has filed a petition under section 271-272 of the Companies Act 2013 against theCompany before Hon'ble National Company Law Tribunal (NCLT) Delhi bench & an ex-parteinterim order has been passed on 04.06.218 by Hon'ble National Company Law Tribunal(NCLT) Delhi Bench against the Company restraining the Company from alienatingencumbering or transferring the fixed assets of the Company and also restraining thecompany from operating its bank accounts.
The Company in consultation with its legal counsel took a suitable legal action againstthe said petition and approached NCLT. On 11.02.2019 Hon'ble National Company LawTribunal (Delhi) vacated all interim ordeर The matter still pending before Hon'bleNational Company Law Tribunal (NCLT) Delhi Bench and is listed for further considerationon 17.10.2019
35. NON-BANKING FINANCIAL COMPANIES AUDITOR'S REPORT (RBI) DIRECTIONS 2008:
Pursuant to the Non-Banking Financial Companies' Auditors' Report (Reserve Bank)Directions 2008 a report from the Statutory Auditors to the Board of Directors has beenreceived by your Company. This report has certified that the Company has complied with allthe directions and prudential norms as prescribed under the RBI Act 1934.
36. CAPITAL FUND TO RISK WEIGHTED ASSETS:
Percentage to capital funds to the risk weighted assets/exposures
37. PARTICULARS OF EMPLOYEES PURSUANT TO THE SECTION 197 (12) OF COMPANIES ACT AND RULE5(1) 5(2) AND 5(3) OF COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL)RULES 2014
The information required pursuant to Section 197 read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 and Companies(Particulars of Employees) Rules 1975 in respect of employees of the Company andDirectors is furnished hereunder:'
*Bhawana Tuli resigned on 15.12.2018 and in place CS Nidhi Jain appointed on 12.02.2019
The percentage increase in remuneration of each Director Chief Financial OfficerChief Executive Officer Company Secretary or Manager if any in the financial year:
Not Applicable as the company has not paid any remuneration to any Directors duringthe financial year 2018-19 and there is 25% increase in the Salary of Company Secretaryand 17.01% increase in the Salary of CFO KMP during the financial year 2018-19.
The percentage increase in the median remuneration of employees in the FinancialYear:-68.40%
Salary decrease in this financial year is due to decrease in number of employees.
The number of permanent employees on the rolls of company: The company had 06 (Six)employees during the year.
Average percentile increase already made in the salaries of employees other than themanagerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point outexceptional circumstances for increase in the managerial remuneration (if any):
Salary decrease in this financial year is due to lay off in number of employees. Thereis no direct nexus between increases in the salary with the performance of the company;further the Company has paid no remuneration to its Directors during the financial year2018-19.
Affirmation that the remuneration is as per the remuneration policy of the Company:
The Company hereby affirm that the remuneration paid is as per the as per theRemuneration Policy for Directors Key Managerial Personnel and other Employees.
Statement of Particulars of Employees pursuant to the Section 197 (12) of Companies Actand Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules2014
a) Details of the employees employed throughout the Financial Year was in receipt ofremuneration for that year which in the aggregate was not less than one crore rupees andtwo lakh rupees.
b) Details of the employees employed for a part of the Financial Year and was inreceipt of remuneration for any part of that year at a rate which in the aggregate wasnot less than eight lakh and fifty thousand rupees per month;
c) If employed throughout the Financial Year or part thereof and was in receipt ofremuneration in that year which in the aggregate or as the case may be at a rate whichin the aggregate is in excess of that drawn by the Managing Director or Whole-timeDirector or Manager and holds by himself or along with his spouse and dependent childrennot less than two percent of the equity shares of the Company.
38. DISCLOSURE REGARDING RECLASSIFICATION OF PROMOTER & PROMOTER GROUP
As the stakeholders are aware that the Mr. Rakesh Kapoor and Mr. Manish Kapoor(hereinafter individually & jointly referred to as the New Promoters') hadentered into a Share purchase Agreement (SPA) dated 15th October 2015 with the promoterseller namely Mr. Surender Kumar Jain Mr. Virender Jain Mर Priti Jain Mर Babita Jain and M/s Sunshine Capital Limited
(hereinafter individually & jointly referred to as the Outgoing Promoters& Promoter Group') the New Promoters of the Company to acquire 2230900 (Twenty TwoLakh Thirty Thousand and Nine Hundred ) Equity Shares constitution 22.35% of the issuedand paid up capital of the Company at a price of र 7.05/- per Equity Share.Pursuant to the execution of the SPA the acquirer had made an open offer to all PublicShareholders in accordance with regulation 3(l) and 4 of Securities and Exchange Board ofIndia (Substantial Acquisition of Shares and Takeovers) Regulations 2011 to acquire up to2594800 equity shares constituting 26% of the Share capital of the company at an offerprice of र 35.25/- per Equity Share. In accordance with the SPA and Open Offer theacquires shall be classified as the New promoters of the Company replacing the existingPromoters subject to the approval of the Shareholders as per regulation 31A of SEBI(Listing Obligations & Disclosure Requirements) Regulations 2015.
On consummation of the offer period the acquirer have acquired in total 300000 equityshares from the general public. The open offer was completed on 7th March 2018. The shareto be acquired in terms of share purchase agreement has not yet been transferred in viewof SEBI's directions. An application has been made by the acquirers and the Company toSEBI and BSE respectively for the execution of SPA pursuant to point no. 1(b) of SEBILetter No. SEBI/HO/ISD/ISD/OW/P/2017/18183 dated August 07 2017 read with BSE Letter No.SURV/OFL/AB/2017-18/SHELL/COMP/538863/1 dated January 04 2018.
As the Denotification of the existing promoters is due to the consummation of openoffer hence request letter dated 13th June 2019 from the Mr. Surendra Kumar JainPromoter of the Company on behalf of Mr. Surendra Kumar Jain Priti Jain Virendra jainand Babita Jain existing promoters of the company for reclassification from Promoter& promoter group to NonPromoter Category. And request letter dated 20th June 2019from the acquirer for reclassification from public category to promoter & promotergroup category. The board of directors at its meeting held on 21st June 2019 decided toplace the matter before the shareholders for the approval.
As per regulation 31A of SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015 The Board of directors of the Company at their meeting held on 21stJune 2019 has favorably considered the request of the outgoing Entities with the subjectto approval of shareholders is sought for the denotification of the existing promotersi.e. the outgoing promoters and reclassification of the acquirers to the open offer as thenew promoters of the Company. The said matter for reclassification of promoters &promoter group has been included in the notice of ensuing Annual General Meeting for theapproval of shareholdeर
39. OTHER INFORMATION
a) Disclosure of composition of audit committee
Details regarding composition of the Audit Committee are given in the CorporateGovernance Report.
b) Board Committees
The Corporate Governance Report also includes details of the various Committees of theBoard.
c) Sweat Equity Shares Employee Stock Option
The Company has not issued any Sweat Equity Shares and had not provided any StockOption Scheme to the employees during the period under review.
Your Directors wish to express their grateful appreciation for the valuable support andco-operation received from sub-brokers business associates vendors bankers financialinstitutions investors stakeholders registrar and share transfer agent other businessaffiliates and media.
The Board places on record its sincere appreciation towards the Company's valuedclients for the support and confidence reposed by them in the organization and thestakeholders for their continued co-operation and support to the company and looks forwardto the continuance of this supportive relationship in future.
Your Directors also place on record their deep sense of appreciation for the devotedservices of the employees during the year under review.
By order of the Board of Directors
For SRI AMARNATH FINANCE LIMITED
Dated: 13th August 2019