To The Members
Your Directors have pleasure in presenting the 34th Annual Report on thebusiness and operations of the Companytogether with the Audited Accounts for the yearended 31stMarch 2017.
The summarized financial results for the year ended 31stMarch 2017are asfollows:-
|Particulars ||For the year ended 31.03.2017 ||For the year ended 31.03.2016 |
|Revenue fromOperations ||1269.90 ||200.91 |
|Other Income ||Nil ||0.02 |
|Total Revenue ||1269.90 ||200.93 |
|Less:Total Expenses ||81.07 ||19.97 |
|Profit before Depreciation Finance ||1188.83 ||180.96 |
|Cost & Tax || || |
|Less: Depreciation ||0.12 ||0.29 |
|Finance Cost ||531.77 ||131.82 |
|Profit/Loss before Tax ||656.94 ||48.85 |
|Less:Tax ||220.30 ||17.64 |
|Profit/(Loss) after Tax ||436.64 ||31.21 |
|EarningsPer share(Rs.) ||4.68 ||0.33 |
REVIEW OF OPERATIONS:
During the year under review theCompanyhas registered revenue of Rs.1269.90Lakhs(Previous year Rs. 200.93Lakhs) and Net Profit after tax of Rs.436.64Lakhs (Previous yearRs.31.21Lakhs). TheCompany continuesto operate in the same business and there was nochange in business activity. No material changes of theCompanyoccurred between end of thefinancial year and the date of this report.
The Company's overall performance during the year under review was satisfactory. Basedon the performance your directors had the pleasure of declaring payment of Final dividendof Rs.1/-per equity shares being10% ofthe paid up Equity share capital of the Company forthe Financial year on 31st March 2017.
In accordance with the Articles of Association of theCompanyand in view of theprovisions of Section 152 of theCompanies Act 2013read with Companies (Management &Administration) Rules 2014 Mr. Mahesh C.Lakhotiya(DIN:00128889) director oftheCompanyretire at the ensuing Annual General Meeting and being eligible offerhimselfforre-appointment.
TheCompanyhas received declaration from all the Independent Directors oftheCompanyconfirming that they meet the criteria of Independent Director prescribed bothunder section 149 (6) of the Companies Act 2013 andas perSEBI (Listing obligation andDisclosure Requirement)Regulations2015.
During the year under review theCompanyhas not accepted any deposits within themeaning of section 73 and 76 of the Companies Act 2013 read with Companies (AcceptanceofDeposits) Rules 2014.
SUBSIDIARIES HOLDING& ASSOCIATE COMPANIES:
M/s.Marigold Investrade Private Limitedis the Holding Company andholds59.06%of theCompany's Equity Share Capital as on 31st March 2017. The Company does not have anysubsidiary or associate Companies.
TheCompanyhas single segment henceAccounting Standard on Segment Reporting (AS-17)neednot be given.
SHARE CAPITAL OF THE COMPANY:
The Paid up Equity Share Capital as at 31st March 2017was Rs.93225500/-dividedinto9322550 Equity Shares having face Value of Rs. 10/-each fully paid - up.During the Year under review the Company has not issued any shares with differentialvoting rights nor granted any stockoptions orsweat equity.
CHANGE IN NATURE OF BUSINESS:
There was no change in the nature of business activities during the Financial Year2016-17.
EXTRACT OF ANNUAL RETURN:
An extract of Annual Return in MGT-9as provided under Section 92(3) of the CompaniesAct 2013is appended to thisReport asAnnexure A'.
The Shares of the company are listed on BSE Limitedand The Calcutta Stock ExchangeLimited. The Company has paid the Listing Fees for the Year2016-17to the Stock Exchange.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS:
The Company being anon-banking finance company registered with the Reserve Bank ofIndia and engaged in the business of giving loans is exempt from complying with theprovisions of section 186 of the Companies Act 2013 in respect of loans and guarantees.Accordingly the disclosures of the loans given as required under the aforesaid sectionhave not been given in this Report.
Information regarding investments covered under the provisions of section 186 of thesaid Act are detailed in the financial statements.
RESERVE BANK OF INDIA GUIDELINES FOR (NBFCS) NON BANKING FINANCIAL COMPANIES:
The Guidelines of Reserve Bank of India are being revised time and again during theyear under review. TheCompanyhas observed all the prudential norms prescribed by ReserveBank of India.
The Company is also in compliance with the NBFC - Corporate Governance (ReserveBank)Directions 2015.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:
There are no significant and material orders passed by the Regulators or Courts thatwould impact the going status of theCompanyand its future operations.
DIRECTOR'S RESPONSIBILITY STATEMENT:
To the best of our knowledge and belief and according to the information andexplanations obtained Directors make the following statement in terms of Section 134 (3)(c) of the Companies Act 2013:
(a) that in the preparation of the Annual Accounts the applicable accountingstandards had been followed along with proper explanation relating to material departuresif any;
(b) that the Directorshad selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of theCompanyat the end of the financialyear and of the profit and loss of the Companyfor that period;
(c) the Directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of theCompany and for preventing and detecting fraud and other irregularities;
(d) the Directors had prepared the annual accounts on a going concern basis;
(e) the Directors had laid down internal financial controls to be followed bytheCompanyand that such internal financial controls are adequate and were operatingeffectively.
(f) the Directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
KEY MANAGERIAL PERSONNEL:
During the year under review theCompanyhas the following persons as the Key ManagerialPersonnel.
|Name of the person ||Designation |
|1. Mrs. Anjana SoniThakur ||Whole Time Director |
|2. Mr. Govinda Soni ||CompanySecretary |
|3. Ms. Antima Soni ||Chief Financial Officer |
Pursuant to the provisions of the Companies Act 2013 andSEBI (LODR)Regulations2015the Board has carried out an evaluation after taking into considerationvarious aspects of the Board's functioning composition of the Board and its Committeesculture execution and performance of specific duties remuneration obligations andgovernance.
The performance evaluation of the Independent Directors was completed. The performanceevaluation of the Chairman and the Non-Independent Directorswas carried out by theIndependent Directors in their meeting held on14thFebruary 2017. The Board of Directorsexpressed their satisfaction with the evaluation process.
NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS:
The details of the number of meetings of the Board held during the FinancialYear2016-2017forms a part of the Corporate Governance Report.
COMMITTEES OF THE BOARD:
Currently there are four Committees which are as follows:
1. Audit Committee
2. Stakeholders Relationship committee
3. Nomination and Remuneration Committee
4. Investment Committee
Details of all the committees along with their charters composition and meetings heldduring the year are provided in the Report on Corporate Governance forming part of thisAnnual Report.
VIGIL MECHANISM/ WHISTLE BLOWER POLICY:
TheCompanyhas a Vigil Mechanism / Whistle Blower policy to report genuine concernsgrievances frauds and mismanagements if any. The Vigil Mechanism /Whistle Blower policyhas been posted on the website of theCompany(www.sftc.co.in)
PREVENTION OF SEXUAL HARASMENT:
The Company has complied with the provision of sexual Harassment of Women at workplace(Prevention prohibition and Redressal) Act 2013 and the Rules made thereunder.
Duringthe Year under review no Complaints were reported.
Your Company recognizes that risk is an integral part of business and is committed tomanaging the risks in a proactive and efficient manner; your Company periodically assessesrisksin the internal and external environment along with the cost of treating risks andincorporates risk treatment plans in its strategy business and operational plans.
The Company has a Risk Management Policy (a) to ensure that all the Current and futurematerial risk exposures of the company are indentified assessed quantifiedappropriately mitigated minimized and managed i.e. to ensure adequate systems for riskmanagement process (b) to establish a framework for the company's risk management processand to ensure its implementation (c) to enable compliance with appropriate regulationswherever applicable through the adoption of best practices (d) to assure business growthwith financial stability.
There are no risks which threaten the existence of the company.
RELATED PARTY TRANSACTIONS:
Your Company has entered into transactions with related parties as defined underSection 2(76) of the Companies Act 2013 read with Companies (Specification of DefinitionsDetails) Rules 2014 which were in the ordinary course of business and on arms' lengthbasis and in accordance with the provision of the Companies Act 2013 Rules issued thereunder.
TheCompany's Equity Shares have been admitted to the depository mechanism of theNationalSecurities Depository Limited (NSDL) and also the Central Depository Services(India) Limited (CDSL). As a result the investors have an option to hold the shares oftheCompanyin a dematerialized form in either of the two Depositories. TheCompanyhas beenallotted ISIN No. INE475D01010.
Shareholders therefore are requested to take full benefit of the same and lodge theirholdings with Depository Participants [DPs] with whom they have their Demat Accounts forgetting their holdings in electronic form.
INTERNAL FINANCIAL CONTROL:
The Board has adopted the policies and procedures for ensuring the orderly andefficient conduct of its business including adherence to Company policies safeguardingof assets prevention and detection of frauds and errors theaccuracy and Completeness ofthe accounting records and timely preparation of reliable financial disclosures.
The Audit Committee evaluates the efficiency and adequacy of financial Control systemin the company its compliance with operating systems accounting procedures and policiesat all locations of the company and strives to maintain the standard in internal FinancialControl.
CODE OF CONDUCT:
YourCompanyis committed to conducting its business in accordance with the applicablelaws rules and regulations and highest standards of business ethics. In recognitionthereof the Board of Directors has implemented a Code of Conduct for adherence by theDirectors Senior Management Personnel and Employees of theCompany. This will help indealing with ethical issues and also foster a culture of accountability and integrity. TheCodewith revision made in accordance with the requirements of Listing Regulationshas beenposted on theCompany's websitewww.sftc.co.in.
All the Board Members and Senior Management Personnel have confirmed compliance withthe Code.
Your Companyreceived letter from previous Statutory Auditori.e.Mr. K K Khadaria &Co.due to their pre-occupancyin other assignmentsMr. K K Khadaria & Coareunableto bereappointed as Statutory Auditor hence the Board has recommended the appointment of M/s.Ajay Daga & Co Chartered Accountants (Firm Regn. No. 100193W) as statutory auditorsof the Company in place of the retiring auditors M/s. K K Khadaria & Co CharteredAccountants (Firm Regn. No. 105013W) M/s. Ajay Daga & Co Chartered Accountant haveconfirmed this eligibility as per Section 139 of the Companies Act to hold office fromthe conclusion of this Annual GeneralMeeting until the conclusion of the 36th AnnualGeneral Meeting Members are requested to approve the appointment of auditors.
Pursuant to the provision of Section 138 of the Companies Act 2013 read withCompanies (Accounts) Rules 2014the Board on recommendation of the Audit committeere-appointed M/s.Kavita Birla & Co. (M. No. 405577) Practicing CharteredAccountant Mumbai as an Internal Auditor of the Company. The Internal Auditor submits hisreports to the Audit Committee.
Based on the report of Internal Audit Management undertakes corrective action in theirrespective areas and thereby strengthens the controls. Significant audit observations andCorrective actions thereon are presented to the Audit Committee of the Board.
Pursuant to provisions of section 204 of the Companies Act 2013 and the Rules madethereunder the Companyhas appointed M/s. Reena S. Modi & Associates (MembershipNo.25346)a firm ofCompany Secretaries in Practiceto undertake the Secretarial Audit oftheCompany. The Secretarial Audit report is annexed herewith as Annexure B' andformsan integral part to this Report.
AUDITOR'S REPORT/ SECRETARIAL AUDIT REPORT:
The observations of the auditors contained in their Report have beenadequately dealtwith in the Notes to the Accounts which are self explanatory and therefore do not callfor any further comments.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
TheCompanyhas an Internal Control System commensurate with the size scale andcomplexity of its operations. The scope and authority of the Internal Audit function isdefined by the Audit Committee. To maintain its objectivity and independence the InternalAudit function reports to the Chairman of the Audit Committee of the Board & to theChairman & Managing Director.
The Internal Audit Department monitors and evaluates the efficacy and adequacy ofinternal control system in the Company its compliance with operating systems accountingprocedures and policies of the Company.
Based on the report of internal audit function theCompanyundertakes corrective actionin their respective areas and therebystrengthensthe controls. Significant auditobservations and recommendations along with corrective actions thereon are presentedto theAudit Committee of the Board.
The Company has in place adequate policies and procedures for ensuring the orderlybusiness including adherence to the company's policies the safeguarding of its assetsthe prevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation.
CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS:
The Company adheres to the requirements set out by the Securities and Exchange Board ofIndia's Corporate Governance practices and have implemented all the stipulationsprescribed. TheCompanyhas implemented several best corporate governance practices.
The Corporate Governance and Management Discussion & Analysis Report which form anintegral partof this Report are set out as a separateAnnexures together with theCertificate from the Auditors of the Companyregarding compliance with the requirements ofCorporate Governance as stipulated in SEBI (LODR) Regulation 2015.
PARTICULARS OF EMPLOYEES:
The information required pursuant to section 197 read with rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 isannexed as Annexure"C"of this report. None of the employees have drawn remuneration more thanRs. 1000000/-p.m. if employed for the part of the year and Rs. 12000000/-p.a. ifemployed throughout the year.
CORPORATE SOCIAL RESPONSIBILITY:
Pursuant to the provision of Section 135 of the Companies Act 2013 read with theCompanies (Corporate social responsibility Policy) Rules 2014 the net profit of theCompany was below Rs. 5 Crores during the last three immediately preceding FinancialYears. Accordingly the Provision of CSR Policy was not applicable forthefinancialyear2016-2017.
EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENT:
There were no material Changes and Commitments affecting the financial position of theCompany which has occurred between the end of the financial year of the company to whichthe financial statements related and date of the report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING:
The Company being a non-banking finance company (NBFC) does not have anymanufacturingactivity. The directors therefore have nothing to report onconservation of energy andtechnology absorption.The Companyhas no foreign exchangeinflow or outflow during the year under review.
The Board of Directors wish to place on record their appreciation for the assistanceand co-operation received from the Financial Institutions Banks Government and LocalAuthorities for their strong support and valuable guidance. The Directors are thankful tothe shareholders for their continued support to the Company.
Forand on behalf ofBoardofDirectors ForM/sSuchitraFinance &Trading Co. Ltd.
|Vinod Kumar Sodani |
|Date:30thMay 2017 |
|Place: Mumbai |