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Upasana Finance Ltd.

BSE: 511764 Sector: Financials
NSE: N.A. ISIN Code: INE819K01014
BSE 00:00 | 26 Feb 14.22 -0.73
(-4.88%)
OPEN

15.69

HIGH

15.69

LOW

14.22

NSE 05:30 | 01 Jan Upasana Finance Ltd
OPEN 15.69
PREVIOUS CLOSE 14.95
VOLUME 866
52-Week high 26.75
52-Week low 12.85
P/E
Mkt Cap.(Rs cr) 6
Buy Price 14.22
Buy Qty 900.00
Sell Price 15.49
Sell Qty 438.00
OPEN 15.69
CLOSE 14.95
VOLUME 866
52-Week high 26.75
52-Week low 12.85
P/E
Mkt Cap.(Rs cr) 6
Buy Price 14.22
Buy Qty 900.00
Sell Price 15.49
Sell Qty 438.00

Upasana Finance Ltd. (UPASANAFINANCE) - Director Report

Company director report

TO THE SHAREHOLDERS

The Directors have pleasure in presenting the Thirty Fifth Annual Report together withthe audited accounts for the year ended 31st March 2020.

1. FINANCIAL HIGHLIGHTS

(Rs. In Lakhs)

Particulars 2019-20 2018-19
Income from Operations 128.58 105.73
Less: Expenditure 68.45 42.21
Profit 60.13 63.52
Less: Statutory Provision on Debts 48.95 -
Profit Before Tax and Extraordinary Items 11.18 63.52
Less: Extraordinary Items - -
Less: Current Tax 8.29 19.82
Profit After Tax 2.90 43.70

2. OPERATIONS

a) Income: The income from operations of the company for the year under review was Rs.128.59 lakhs as against Rs. 105.73 lakhs during the previous year.

b) Profit after tax: The profit after tax of the company for the year under review wasRs. 2.90 lakhs as against Rs. 43.70 lakhs during the previous year.

3. MANAGEMENT DISCUSSION AND ANALYSIS

a) Classification by Reserve Bank of India (RBI): The Company is registered with RBI asNon Deposit taking Non-Banking Financial Company (NBFC-ND) and holds a valid certificateof Registration.

b) Business Review: The Company is currently carrying on the business of short term andlong term financing to both corporate and non-corporate entities. Further the Companycontinues to concentrate upon recovery of overdue receivables. Even while pursuing thelegal route the company attempts negotiations with customers for early recovery of debts.

c) Future Outlook: The Company is confident of doing better business in the form ofshort term and long term financing (both secured and unsecured).

4. DIVIDEND

In order to plough back the profits your directors do not recommend any dividend forthe year under review.

5. TRANSFER TO RESERVES

An amount of Rs. 57857/- (previous year Rs. 873977/-) has been transferred toSpecial Reserve as per the requirement under Section 45 IC of the Reserve Bank of IndiaAct 1934. The company has not transferred any amount to the general reserves.

6. EXTRACT OF ANNUAL RETURN

An extract of the annual return in Form MGT-9 is appended as Annexure I to this Report.

7. CORPORATE GOVERNANCE

Clause 15(2)(a) of SEBI (Listing Obligations and Disclosure Requirements) (LODR)Regulations 2015 prescribes that Clause 27 (submission of Quarterly Corporate GovernanceReport) of LODR Regulations is not applicable for Companies having paid up equity sharecapital not exceeding Rs.10 Crores and Net worth not exceeding Rs.25 Crores as on the lastday of the previous year. The paid up capital of the company is Rs.4.28 Crores and thenetworth is less than Rs.25 Crores as at 31.03.2020. Hence clause 27 is not applicable tothe Company and the report on Corporate Governance is not provided.

8. DIRECTORS AND KEY MANAGERIAL PERSONNEL

The composition of the company's board is in conformity with the applicable provisionsof the Companies Act 2013 with regard to Independent Directors and women directors as on31st March 2020.

Ms. Rekha M Jain (DIN: 07704034) and Ms. Khushbu Mohan Kumar Jain (DIN: 07704023)Directors are liable to retire by rotation at the ensuing Annual General Meeting and beingeligible offers themselves for re-appointment.

Mr. Biswajit Chaudhury (DIN: 08611223) was appointed as Additional / IndependentDirector of the Company with effect from 14th day of November 2019 based on therecommendations made by the Nomination and remuneration committee and holds office uptothe date of ensuing AGM and is eligible to continue as director of the Company. The boardrecommends his continuation as director as set forth in the notice convening AGM

Mr. Naressh Mahendra Kumar Jain (DIN: 08102162) is proposed to be appointed asIndependent Director of the Company for term of five years with effect from the date ofensuing AGM based on the recommendations made by the Nomination and remunerationcommittee.

Necessary resolution for the re-appointment / confirmation is being placed for approvalof the members at the AGM. The board recommends their re-appointment / confirmation asdirectors of the Company. A brief resume of theirs and other relevant information isfurnished in the notice convening the AGM.

9. DIRECTORS' RESPONSIBILITY STATEMENT

The Directors confirm that:-

a) In the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;

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 the Company at the end of the financial year and of theprofit of the Company for that year.

c) The directors have taken proper and sufficient care 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.

d) The directors have prepared the annual accounts on a going concern basis.

e) The directors have laid down internal financial controls which are adequate and areoperating effectively.

f) The directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.

10. DECLARATION BY INDEPENDENT DIRECTORS

All the independent directors have submitted the declaration of independence asrequired pursuant to section 149(7) of the Companies Act 2013 stating that they meet thecriteria of independence as laid down section 149(6) of the Companies Act 2013. In theopinion of the board the independent directors fulfill the conditions specified in theAct and the rules made there under for appointment as independent directors and confirmthat they are independent of the management.

11. SEPERATE MEETING OF INDEPENDENT DIRECTORS

As stipulated by the Code for Independent Directors under the Companies Act 2013 aseparate meeting of the Independent Directors of the Company was held to review theperformance of the Board as a whole taking into account the views of the non-executivedirector. The independent Directors also reviewed the quality content and timeliness ofthe flow of information between the Management and the Board and its committees which isnecessary to effectively and reasonable perform and discharge their duties.

12. BOARD MEETINGS

Five Board Meetings were held during the Current Financial year on 8th April2019 30th May 2019 14th August 2019 14th November2019 and 14th February 2020 and the gap between two meetings were not morethan 120 days.

Name of Director

No. of Meetings

Entitled to attend Attended
1 Ms. Bhavika M Jain 5 5
2 Ms. Rekha M Jain 5 5
3 Ms. Khushbu Mohan Kumar Jain 5 5
4 Mr. Bharat Kumar Dughar 5 5
5 Mr. Velu 5 5
6 Mr. Biswajit Chaudhury* 1 1

*Appointed with effect from 14th November 2019.

13. COMMITTEES OF THE BOARD

Currently in line with the statutory requirement the Board has three committeesnamely the audit committee nomination and remuneration committee and stakeholder'srelationship committee.

a) Audit Committee

The Committee as on 31st March 2020 comprised of the following Directors asits Members:

Name of Member Designation Category
Mr. Bharat Kumar Dughar Chairman NEID
Mr. Velu Member NEID
Ms. Bhavika M Jain Member NED

The terms of reference of the Audit Committee interalia include the recommendation forappointment remuneration and terms of appointment of auditors of the companyexaminations of the financial statement and the auditors' report thereon and other mattersspecified for audit committees under Section 177 of the Companies Act 2013 and SEBIListing Regulations 2015.

The Committee met four times during the financial year on 30th May 2019 14thAugust 2019 14th November 2019 and 14th February 2020. The detailsof attendance in Committee meetings are as follows:

S. No Name of Director

Designation

Category

No. of Meetings

Entitled to attend Attended
1 Mr. Bharat Kumar Dughar Chairman NEID 4 4
2 Mr. Velu Member NEID 4 4
3 Ms. Bhavika M Jain Member NED 4 4

b) Nomination and Remuneration Committee

The Committee as on 31st March 2020 comprised of the following Directors asits Members:

Name of Member Designation Category
Mr. Bharat Kumar Dughar Chairman NEID
Mr. Velu Member NEID
Ms. Bhavika M Jain Member NED

The Committee met once during the financial year on 14th November 2019.

The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of Directors senior management and keymanagerial personnel and the remuneration of directors key managerial personnel and otheremployees. The Nomination and Remuneration Policy is attached in Annexure II of thisreport.

The details of attendance in Committee meetings are as follows:

S. No Name of Director

Designation

Category

No. of Meetings

Entitled to attend Attended
1 Mr. Bharat Kumar Dughar Chairman NEID 1 1
2 Mr. Velu Member NEID 1 1
3 Ms. Bhavika M Jain Member NED 1 1

c) Stakeholders Relationship Committee

The Committee as on 31st March 2020 comprised of the following Directors asits Members:

Name of Member Designation Category
Mr. Bharat Kumar Dughar Chairman NEID
Mr. Velu Member NEID
Ms. Bhavika M Jain Member NED

The Committee met twice during the financial year on 30th May 2019 and 14thFebruary 2020. The details of attendance in Committee meetings are as follows:

S. No Name of Director

Designation

Category

No. of Meetings

Entitled to attend Attended
1 Mr. Bharat Kumar Dughar Chairman NEID 2 2
2 Mr. Velu Member NEID 2 2
3 Ms. Bhavika M Jain Member NED 2 2

14. VIGIL MECHANISM/ WHISTLE BLOWER POLICY

The Board has adopted a policy on Whistle Blower Policy (vigil mechanism) in accordancewith the provisions of the Companies Act 2013 which provides a formal mechanism for alldirectors individual employees and other stakeholders of the Company to report theirgenuine concerns or grievances about unethical behavior actual or suspected fraud orviolation of the Company's code of conduct and ethics. The policy also provides foradequate safeguards against victimisation of director(s) / employees(s) who avail of themechanism and also provides direct access to the Chairman of the audit committee.

15. BOARD EVALUATION

Pursuant to the provisions of the Companies Act 2013 evaluation of all the Boardmembers its committees and the Board as a whole was done on an annual basis as per thecriteria for performance evaluation framework laid down by the Nomination and RemunerationCommittee and approved by the Board. During the year the Board adopted a formal mechanismfor evaluating its performance and as well as that of its committees and individualdirectors. The exercise was carried out through an evaluation process covering variousaspects of the Board's functioning such as composition of the Board and Committeesfrequency of meetings administration of meeting flow of information to the Boardexperience and competencies performance of specific duties and obligations disclosure ofinformation to the Board and Stakeholders etc. A separate exercise was carried out toevaluate the performance of individual directors who were evaluated on parameters

such as attendance contribution at the meetings and independence judgment. TheDirectors expressed their satisfaction with the evaluation results.

16. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

None of the employees draws remuneration of Rs. 850000/- or above per month andRs.10200000/- or above per year. Hence details of the employees of the Company asrequired pursuant to 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are not furnished.

Having regard to the provisions of Section 136(1) read with its relevant proviso of theCompanies Act 2013 the disclosure pertaining to remuneration and other details asrequired under Section197(12) of the Companies Act 2013 read with Rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 forming partof the Annual Report is available for inspection at the registered office of the companyduring working hours. Any member interested in obtaining such information may write to theCompany Secretary and the same will be furnished without any fee and free of cost

17. AUDITORS

a) STATUTORY AUDITORS

M/s. S. JAWAHAR & ASSOCIATES. Chartered Accountants Statutory Auditors wereappointed as the Statutory Auditors of the Company to fill the casual vacancy caused bythe resignation of M/s. Kalyanasundaram & Co Chartered Accountants Chennai at theBoard Meeting held on 14.07.2020. Necessary resolution is placed before the members in thenotice convening Annual General Meeting for confirmation of their appointment.

Further M/s. S. JAWAHAR & ASSOCIATES. Chartered Accountants Statutory Auditorsretire at the ensuing Annual General Meeting and are eligible for re-appointment. In termsof Section 139 of the Companies Act 2013 read with Companies (Audit and Auditors) Rules2014 M/s. S. Jawahar & Associates. are eligible to be reappointed for a period of 5years from the conclusion of the ensuing Annual General Meeting until the conclusion ofthe Annual General Meeting of the Company to be held in the year 2025. The Company hasreceived consent and confirmation that their appointment will be within the limitsspecified u/s. 139 of the Companies Act 2013. The Board recommends their re-appointment.

b) SECRETARIAL AUDITORS

Pursuant to Section 204 of the Companies Act 2013 read with Companies (Appointment andRemuneration of Managerial personnel) Rules 2014 the Board of Directors have appointedM/s. A.K. JAIN & ASSOCIATES Company Secretaries in Practice Chennai as theSecretarial Auditors of the Company to conduct the Secretarial Audit for the financialyear 2019-2020. The Secretarial Audit Report in Form MR - 3 is enclosed vide Annexure IIIand forms part of this report. The reply given by the board on remarks made by theSecretarial Auditor are as follows:

Auditors Observation Reply to Observation
The un-audited results for the quarter ended 30th June 2019 & 31st December 2019 were intimated to the Stock Exchange beyond the prescribed limits as specified in Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (LODR Regulations) on 16.08.2019 and 17.02.2020 respectively. The Company had inadvertently omitted to intimate the un-audited results of the Company for the quarter ended 30th June 2019 and 31st December 2019. The Company will ensure that the necessary intimations are made to BSE on time
The Company does not maintain a functional website as prescribed under Regulation 46 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015 The company is taking necessary steps to develop a functional website and will be deployed at the earliest.

c) INTERNAL AUDITORS

The Board of Directors as per the recommendation of Audit Committee appointed M/s.SIDHARTH MEHTA & Co. Chartered Accountants Chennai (FRN: 008108S) as InternalAuditor.

19. INTERNAL FINANCIAL CONTROLS

The Company has adequate system of internal financial controls to safeguard and protectfrom loss unauthorized use or disposition of its assets. All the transactions areproperly authorized recorded and reported to the Management. The Company is following allthe applicable Accounting Standards for properly maintaining the books of accounts andreporting financial statements. The internal auditor of the company checks and verifiesthe internal control and monitors them. The Company confirms that there are proper andadequate internal control systems and procedures commensurate with its size and nature ofits business for ensuring the orderly and efficient conduct of its business forsafeguarding its assets the prevention and detection of frauds and errors the accuracyand completeness of the accounting records and timely preparation of reliable financialinformation. The company has not noticed any major weakness in the internal financialcontrol procedures.

20. RISK MANAGEMENT

The Company had identified certain business risks and also the measures for dealingwith such risks which it faces in day to day operations of the Company. However thecompany faces operational risks relating to people process legal environment andexternal factors investment risk and regulatory risks. The company manages these risks byprudently investing its funds managing its people and complying with all the regulations.These risks are continuously reviewed and monitored by the management. The Board alsoreviews the risks and corrective actions and mitigation measures are taken as and whenneeded.

21. DISCLOSURE UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013

There were no complaints / cases pursuant to the Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013.

22. GENERAL

The company has complied with the provisions of secretarial standards issued by theInstitute of Company Secretaries of India in respect of meetings of the board of directorsand general meetings held during the year.

The application filed by the company for change in control/management was rejected byReserve Bank of India (RBI) vide their letter dated 24.09.2019. The acquirer hasaccordingly decided to withdraw the takeover offer and an Open offer withdrawaladvertisement was published on 05.11.2019

COVID-19 pandemic that hit the entire country towards the later part of March 2020 isan unprecedented event and may have far-reaching ramification on the economy as a wholeand also on the prospect of the company. The Directors will continue to track the eventsclosely and will take appropriate actions as warranted by the situation. There were nomaterial changes and commitments affecting the financial position of the Company whichhave occurred between the end of the financial year of the Company to which the financialstatements relate and the date of the report.

The Company has nothing to report/disclose in respect of the following items asdetailed below:

a) The Company has no subsidiary associate or Joint venture companies and hencereporting on the performance and financial position of them as per AOC 1 and preparationof consolidated financial statements are not applicable to the company.

b) There is no change in the nature of business of the Company during the year.

c) No company have become or ceased to be its subsidiaries joint ventures orassociates during the year under review.

d) During the year under review the Company has not accepted any deposits from thepublic within the meaning of Section 73 of the Companies Act 2013

e) There are no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and company's operations in future.

f) The company has not issued any equity shares with differential rights during theyear under review.

g) The company has not issued any shares including sweat equity shares to the employeesunder any scheme during the year under review.

h) The company was not required to constitute a CSR Committee as the company has notmet any of the thresholds mentioned in Section 135 of the Companies Act 2013 during thefinancial year under review. Hence reporting about policy on Corporate Socialresponsibility and the initiatives taken are not applicable to the company.

i) The provisions of section 186 is not applicable to the company and hence reportingunder section 186 on loans guarantees and investments does not arise.

j) There were no contracts or arrangements with related parties referred to insubsection (1) of Section 188. Hence Form AOC-2 pursuant to the Companies (Accounts)Rules 2014 is not enclosed

k) The Company has nothing to report on conservation of energy and technologyabsorption. There were no foreign exchange earnings or outgo for the company during theyear.

23. ACKNOWLEDGEMENT

Your Directors wish to place on record their appreciation for the continued supportfrom all those assisting the recovery of over dues. The Directors also wish to thank theemployees for their co-operation.

By Order of the Board
For UPASANA FINANCE LIMITED

 

31.07.2020 -SD- -SD-
Chennai Bhavika M Jain Khushbu M Jain
Director Director
DIN:07704015 DIN: 07704023

.