The Members of SUPREME HOLDINGS & HOSPITALITY (INDIA) LIMITED
Your Directors have pleasure in presenting Thirty Sixth Annual Report and AuditedAccounts of the Company for the year ended March 31 2018.
|1. FINANCIAL RESULTS: || ||(Rs. in Lacs) |
|Particulars ||2017-18 ||2016-17 |
|Total Income ||4868.33 ||619.93 |
|Total Expenditure (excluding depreciation) ||4570.47 ||738.22 |
|Profit/(Loss) before depreciation and Tax ||297.86 ||(118.29) |
|Depreciation ||4.38 ||0.21 |
|Profit / (Loss) before Tax ||293.48 ||(118.51) |
|Tax Expenses || || |
|Current Tax ||103.54 ||- |
|Deferred Tax ||39.50 ||(42.69) |
|Profit/(Loss) for the year ||150.44 ||(75.82) |
FIRST TIME ADOPTION OF IND AS:
These financial statement of the Company have been prepared in accordance with IndianAccounting Standards as notified under Section 133 of the Companies Act 2013 (the Act)read with Companies (Indian Accounting Standard) Rules 2015 and other relevant provisionsof the Act. These are the Company's first financial statements prepared in accordance withIndian Accounting Standards (Ind AS).
No dividend is recommended for the year under review.
For the financial year ended March 31 2018 your Company has not transferred anyamount to Reserves.
4. OPERATIONS: PANVEL i. PANVEL LAND
As the Members were informed earlier that the land Bank of the Company at Panvel Talukawas included in the Navi Mumbai Airport Influence Notified Area (NAINA) and the CIDCO whowas appointed as the Special Planning Authority for the NAINA had published the draftfollowed by a modified Draft Development control and promotion regulations for the InterimDevelopment plan of NAINA and submitted the same to Government for its sanction. TheGovernment had sanctioned a part of the said draft Interim Development Plan on 27 thApril 2017 and kept our land bank in excluded portion which is still pending forsanction.
ii. BELMAC RIVERSIDE-I
During the year the Company has entered into a Joint Development Agreement with SquareOne Housing Corporation (SOHC) a proprietorship concern of
Managing Director of the Company for development of a residential project "BELMACRIVERSIDE - I" on Land admeasuring 2430 sq. mtr. situuated at Suvey No. 99/5 villageAkurli Taluka Panvel. The SOHC has contributed land for the Project and all theapprovals/ permissions Developments and other work of the Project is being undertaken bythe Company. All major requisite approvals for constructing a Residential Complexincluding RERA Registration Certificate have been received. The tenders for CivilConstruction has been awarded and the work is commenced. The project comprises of twowings of three floors each totalling to 27 appartments of 1 BHK/ 2BHK with variousfacilities/ amenities. Booking of the appartments have started and the Company hasreceived good response.
The Premier Luxury residential project of the Company "BELMAC RESIDENCES" inPune is progressing as per schedule. The project is comprises of 6 Buildings of 15 storyeach of 2 BHK/3BHK/4BHK beautiful apartments with huge central garden clubhouse squashcourt five -aside football court Hydroponic farm Spa Business Centre Gymnasiumbanquet Hall Children play area Concierge desk Games room Day care Centre and manymore facilities. The Project is RERA Compliant and being Devloped in phases. The firstPhase is consist of two Buildings which are near to the completion stage.
The Second phase of the Project is under construction stage and the Company currentlycreating the site infrastructure required for development.
5. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
(a) Industry Structure:
India has emerged as the fastest growing major economy in the world and is expected tobe one of the top three economic power of the world over the next 10-15 years. The realstate sector is one of the most globally recognised sector. In India real state is secondlargest employer after agriculture. In line with the goverment's reformist approach toboost the real estate and housing sector the Government has taken several initiatives toencourage the development in the Sector The real state sector is expected to grow rapidlyover the next decade.
(b) Company's Performance:
The revenue from real estate activity is recognised in accordance with the"Guidance Note on Accounting for Real Estate Transactions (for entities to whom IndAS is applicable)" issued by the Institute of Chartered Accountants of India (ICAI)and accordingly the income from operations during the year 2017-18 has been reported atRs. 4778.04 Lacs. The other Income during the year 2017-18 consists of interest income Rs.18.86 Lacs and gain on sale of current investments Rs. 71.43 Lacs. The total Income forthe year 2017-18 was at Rs. 4868.33 Lacs as compared to Rs. 619.93 Lacs in the previousyear.
During the year under review the cost of sales and other operational expenses were atRs. 4001.91 Lacs as against Rs. 529.47 Lacs in the previous year. The employees costduring the years 2017-18 was at Rs. 78.93 Lacs as compared to Rs. 26.16 Lacs in theprevious year and the Administrative & Other Expenses were at Rs. 489.62 lacs ascompared to Rs. 182.60 lacs in the previous year
The Profit for the year 2017-18 before depreciation and taxation was at Rs. 297.86 Lacsas against loss of Rs. 118.29 Lacs in the previous year. The Depreciation was at Rs. 4.38Lacs as against Rs. 0.21 Lacs in the previous year. After providing for taxationincluding deferred tax the Company has reported Profit of Rs. 150.44 Lacs during the year2017-18 as against Loss of Rs. 75.82 Lacs in the previous year.
(c) Segment -wise Performance:
As Company had only one reportable segment during the year disclosure under Ind-AS 108on segment reporting is not applicable to the Company.
(d) Outlook for the Company:
The residential projects of the Company is progressing as per schedule. The Company iscommitted and has focus on quality and timely delivery of the project and is alsodeveloping brand image for the Company. The growth and long term prospects of the Companyare encouraging.
(e) Opportunities Threats Risk and Concerns:
As the policy reforms are picking up speed the Company strongly believes that thedemand for the real estate in the country will remain strong in the medium to long termand there are lots of opportunities in this sector. The Government has also recognized theimportance of real estate sector and launched several reform measures from time to timelike the interest subsidy scheme smart city project housing for all simpler approvalprocedures relaxed FDI Norms easy availability of finance at attractive interest ratestax incentives lower GST rates for affordable housing and various other measures toboost this sector . The Real Estate (Regulation and Development) Act 2016 has alsoboosted the confidence of consumer and brought about the much needed transparency andorder to the real estate transactions by creating a systematic and a uniform regulatoryenvironment thereby protecting consumer interest and making real estate developersaccountable for timely completion of projects. These positive developments has made thissector more attractive.
Various challenges are also their along with opportunities. The Changes in Governmentpolicies and schemes unanticipated delays in project approvals increase cost ofmanpower rising cost of constructions availability of trained labour force availabilityof finance multifaceted tax levies on various transactions are the major challenges inthe construction Industry. There are substantial procedural delays with regards toconstruction approvals. Retrospective policy changes and regulatory bottlenecks may impactprofitability and affect attractiveness of the sector . Sectoral Caps set by RBI for thetotal maximum exposure of banks to real estate including individual housing loans andlending to developers for construction finance which is very low and is curtailing theoverall growth of Industry. Absence of long term funding from Banks is forcing developersto look at alternative sources of funds most of which do not offer affordable interestrates. The Sector in general are sensitive to fluctuations in the economy governmentpolicies and is very sensitive to the global security environment. In the course of itsbusiness the Company is exposed to stiff competition from other developers in the market
(f) Internal Control Systems and their Adequacy:
The Company has proper and adequate systems of internal control. The internal controlsystems of the company are designed to ensure the financial and other records are reliablefor preparing the financial statements and other data and for accountability of assets.
The company has an Audit Committee of the Board of Directors which meets regularly toreview the adequacy of internal controls.
(g) Human Resources:
As the project of the Company progressed new talent was inducted into organization.The Company enjoys cordial and harmonious relationship with its employees. The Company has25 number of Permanent employees as on March 31 2018.
6. FIXED DEPOSITS:
During the year under review the company has not invited any Fixed Deposit from thepublic.
7. LOANS AND GUARANTEE AND INVESTMENTS:
Particulars of loans given investments made and guarantees or securities provided bythe Company under Section 186 of the Companies Act 2013 are reported in the financialstatement (Please refer Note .No. 5 & 6 to the Standalone Financial Statement).
8. INVESTOR EDUCATION AND PROTECTION FUND:
There has been no transfer to the said Investor Education and Protection Fund duringthe current year.
9. EXTRACT OF ANNUAL RETURN:
Pursuant to section 134 (3) (a) and Section 92(3) of Companies Act 2013 read withrelevant Rules framed thereunder the extract of Annual Return as on March 31 2018 formsa part of this Report as "Annexure -A"
The information required under Section 197 of the Companies Act 2013 and read withRule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014are given in 'Annexure -B". In terms of Section 136(1) of the Companies Act 2013read with Rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 the Board's Report is being sent to all the shareholders of theCompany excluding the annexure containing names of the top ten employees in terms ofremuneration drawn. Any shareholder interested in obtaining a copy of the said annexuremay write to the Company Secretary at the Registered Office of the Company.
11. RELATED PARTY TRANSACTION:
All related party transactions that were entered into during the financial year were onan arm's length basis and were in the ordinary course of business. There are no materiallysignificant related party transactions made by the Company with Promoters Directors KeyManagerial Personnel which may have a potential conflict with the interest of the Companyat large. Disclosure pertaining to contracts/arrangements entered into by the company withrelated parties referred to in sub-section (1) of section 188 of the Companies Act 2013thereto is enclosed as "Annexure - C" to this report. The policy on RelatedParty Transactions is hosted on the website of the Company under the web link http://www.supremeholdings.net/company-policies.htm
12. SUBSIDIARY COMPANY:
Your Company has one Wholly-owned Subsidiary company namely Helmet Traders Limited ason March 31 2018.
A Statement containing the salient features of the financial statement of subsidiariesin Form AOC-1 as prescribed under the first proviso to sub-section (3) of section 129 ofthe Companies Act 2013 read with rule 5 of The Companies (Accounts) Rules 2014 isattached and forms part of the Annual Report.
The policy on determining Material Subsidiaries is hosted on the website of the Companyunder the web link http://www.supremeholdings.net/company- policies.htm
13. NOMINATION AND REMUNERATION POLICY
The details of Nomination and Remuneration policy of the Company for Directors KMP'sand Senior Personnel of the Company is enclosed as "Annexure -D" to this report.
14. ANNUAL EVALUATION BY THE BOARD:
In accordance with the provisions of the Companies Act 2013 and SEBI (ListingObligation and Disclosure Requirements) Regulations 2015 the Nomination and RemunerationCommittee has laid down the criteria for evaluation of individual Directors Committees ofthe Board and the Board as a whole. Based on the criteria the exercise of evaluation wascarried out through as structured process covering various aspects of the Boardfunctioning such as composition of Board and Committees experience and expertiseperformance of specific duties and obligation governance and compliance issuesattendance contribution at meeting etc.
The performance evaluation of the Non Independent Directors was carried out by theIndependent Directors at a separately convened meeting where the performance of the Boardas a whole perfomance of Chairperson of the Company was evaluated and reviewed. Theperformance of the Independent Directors was carried out by the entire Board (Excludingthe Director being evaluated).
15. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:
There have been no material changes and commitments affecting the financial position ofthe Company which have occurred between the end of the financial year of the Company towhich the financial statements relate and the date of the report.
16. SHIFTING OF REGISTERED OFFICE OF THE COMPANY
The Registered Office of the Company was shifted from 1 Pearl Mansion (N) 91Maharshi Karve Road Mumbai - 400020 to Survey No 38A/2 Opp. Brahma Suncity & PMCGarden Wadgaonsheri Pune - 411014 w.e.f. November 16 2017.
17. VIGIL MECHANISM / WHISTLE BLOWER POLICY:
The Company has a vigil mechanism to deal with instance of fraud and mismanagement. Thepolicy on Vigil Mechanism / Whistle Blower Policy is hosted on the website of the Companyunder the web link http://www. supremeholdings.net/company-policies.htm
18. CORPORATE GOVERNANCE:
A separate report on Corporate Governance is furnished as a part of the DirectorsReport as "Annexure - E" and a certificate from the Company's Auditors regardingthe compliance of conditions of Corporate Governance is annexed to the said Report.
19. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS:
The Familiarization programme enable the Independent Directors to understand theCompany's business and operations in depth and to familiarize them with the process andfunctionaries of the Company and to assist them in performing their role as IndependentDirectors of the Company. The Company's Policy of conducting the Familiarization programmehas been hosted on the website of the Company under the web link http://www.supremeholdings.net/company-policies.htm
20. RISK MANAGEMENT:
The Company has adequate risk assessment and mitigation policy commensurate with sizeand nature of business to ensure that all the current and future material risk exposuresof the Company are identified assessed quantified appropriately mitigated minimisedand managed. There are no elements of risk which in the opinion of the Board may threatenthe existence of the Company.
During the year under review Mr Vinod Jatia resigned from the post of Chairman &Managing Director w.e.f. April 25 2017 due to personal reasons. The Board of
Directors placed on record their appreciation for the valuable contribution rendered byMr. Vinod Jatia to the Company during his tenure as - Chairman & Managing Director ofthe Company.
Board of Directors at their meeting held on May 13 2017 appointed Mr. Vidip JatiaDirector as the Managing Director of the Company for a period of 3 years from May 132017. The Board also appointed him as Chairman of the Board with effect from May 13 2017.
Mr. Prateek Jatia resigned as Chief Financial Officer (CFO) of the Company w.e.f March01 2018 due to personal reasons.
As per the provision of the Companys Act 2013 Mrs. Namita Jatia will retire at theensuing AGM and being eligible seek re-appointment.
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed both under the Actand Regulation 16 of the Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015.
During the year Nine Board Meetings were held. The details of which are given in theCorporate Governance Report. The intervening gap between the meetings was within theperiod prescribed under the Companies Act 2013.
23. DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant to the requirement under section 134 (3) (c) of the Companies Act 2013 withrespect to Directors' responsibility statement it is hereby confirmed:
i) That in the preparation of the accounts for the financial year ended 31st March2018 the applicable Accounting Standards have been followed along with properexplanations relating to material departures;
ii) That the directors have adopted such accounting policies and applied themconsistently and made judgments and estimates that were reasonable and prudent so as togive a true and fair view of the state of affairs of the company at the end of thefinancial year and of the profit and loss of the company for the year under review;
iii) That the directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the company and for preventing and detecting fraud andother irregularities.
iv) That the directors have prepared the accounts for the financial year ended 31stMarch 2018 on a going concern basis.
v) That Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively
vi) That the Directors had devised systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
24. LISTING STATUS:
The company's shares are presently listed on Bombay Stock Exchange Ltd.
25. AUDIT COMMITTEE:
The present Audit committee comprises of Mr. S. N. Atreya Mr. Rishabh Kalati Mrs.Shruti Jatia and Mr. Vidip Jatia.
Mr. S. N. Atreya Mrs. Shruti Jatia and Mr. Rishabh Kalati are Independent Directors.Mr. S. N. Atreya is the Chairman of the Audit Committee.
26. AUDITORS & AUDITORS REPORT:
Pursuant to provisions of Section 139(1) of the Companies Act 2013 M/s. KCPL &Associates LLP Chartered Accountants were appointed as Statutory Auditors of the Companyto hold the office till the conclusion of the Annual General Meeting to be held during theyear 2019 subject to ratification at every Annual General Meeting.
The Company has received letter from the Statutory Auditors to the effect that theirappointment if made would be within the prescribed limit under Section 141 (3) (g) ofthe Companies Act 2013 and that they are not disqualified from the appointment.
Your Board recommends the ratification of appointment of M/s. KCPL & AssociatesLLP Chartered Accountants Mumbai as Statutory Auditors of the Company for the financialyear 2018-19 and to hold the office till the conclusion of the next Annual General Meetingto be held during the year 2019.
There is one observation in the Auditors Report which is read as "The Company hasmade provision for gratuity as per current employee and salary instead of recognizingliability as per the present value of defined benefit obligation at the balance sheet datecalculated on the basis of actuarial valuation in accordance with Ind AS 19 "EmployeeBenefits". The Consequential impact of adjustment if any owing to this noncompliance on the financial statement is presently not ascertainable".
The explanation of the Board on the observation made in the Auditor Report is asfollows "The Company has made adequate provision for gratuity liability as per thepayment of Gratuity Act and hence the Company has not obtained actuarial valuation. In theabsence of actuarial valuation the impact cannot be ascertained.
27. SECRETARIAL AUDITOR:
Pursuant to provision of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hadappointed M/s. Shivlal Maurya & Co. a Practicing Company Secretary firm to undertakeSecretarial Audit of the Company.
Accordingly the Secretarial audit of the Company for the financial year 2017-18 wasconducted by M/s. Shivlal Maurya & Co.
The Report of the Secretarial Audit of the Company is annexed herewith as"Annexure - F". There were no reservation and qualification as marked inSecretarial Audit Report which requires any explanation by the Board of Directors.
28. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR OTHERS:
There are no significant and material orders passed by the regulators or others whichimpacts the going concern status and Company operations in future.
29. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:
A. CONSERVATION OF ENERGY
i. The steps taken or impact on conservation of energy:
Though our operations are not energy - intensive efforts have been made to conserveenergy by utilizing energy- efficient equipment.
ii. The steps taken by the Company for utilizing alternate sources of energy:
The Company is using electricity as the main source of energy and is currently notexploring any alternate source of energy. In future your Company will take steps toconserve energy and use alternative source of energy such as solar energy.
iii. The Capital investment on energy conservation equipment:
Your Company firmly believes that our planet is in dire need of energy resources andconservation is the best policy. Your Company has not made any investment on energyconservation equipment.
B. TECHNOLOGICAL ABSORPTION:
i. The efforts made towards technology absorption:
During the year the Company does not have any plant & machinery. Therefore notechnology absorption and research and development activity are carried out.
ii. The benefits derived like product improvement cost reduction product developmentor import substitution:
No such specific benefit derived during the year due to technology absorption.
iii. In case of imported technology (imported during the last three years reckoned fromthe beginning of the financial year:
No technology has been imported by the Company
iv. The expenditure incurred on Research and Development: NIL
C. Foreign Exchange Earnings and Outgo
Earning: Nil Outgo: Marketing Expenses and foreign Travelling Expenses - Rs. 8.69 Lacs
30. SEXUAL HARASSMENT
The Company has Policy on Prevention of Sexual Harassment of Employee. A ComplaintRedressal Committee has been set up to redress complaints received regarding sexualharassment. All employees are covered under the policy. The Company has not received anycomplaint during the financial year.
31. CORPORATE SOCIAL RESPONSIBILITY:
The Company has constituted a Corporate Social Responsibility (CSR) Committee incompliance with Section 135 of the Companies Act 2013.
The Company has not initiated any Corporate Social Responsibility activities as thesaid provisions are presently not applicable to the Company.
32. DETAILS IN RESPECT OF FRAUDS REPORTED BY THE AUDITOR UNDER SECTION 143(12) OFCOMPANIES ACT 2013:
There are no frauds reported by the Auditors under Section 143(12) of Companies Act2013.
The Board of Directors wish to place on record their sincere appreciation andacknowledge with gratitude the support and co-operation extended by all the Governmentagencies shareholders and employees at all levels and look forwards for their continuedsupport.
| ||For and on behalf of the Board |
|Place: Pune ||Vidip Jatia |
|Date May 30 2018 ||Chairman & Managing Director |
| ||(DIN 06720329) |