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Viceroy Hotels Ltd.

BSE: 523796 Sector: Services
NSE: VICEROY ISIN Code: INE048C01017
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VOLUME 2951
52-Week high 6.95
52-Week low 1.52
P/E
Mkt Cap.(Rs cr) 11
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Viceroy Hotels Ltd. (VICEROY) - Director Report

Company director report

To

The Members

VICEROY HOTELS LIMITED

The Directors present the 56th Annual Report of ViceroyHotels Limited along with the Audited Statement of Accounts of the Company for the yearended 31st March 2021.

PERFORMANCE/ FINANCIAL RESULTS/STATE OF COMPANY'S AFFAIRS:

The financial performance of the Company for the year ended March 312021 is summarized below:

(Rupees in Lakhs)

PARTICULARS STANDALONE CONSOLIDATED
2020-21 2019-20 2020-21 2019-20
Income from Operations 2206.75 8143.87 3476.48 12238.58
Other Income 267.54 693.08 587.87 458.11
Total Revenue 2474.29 8836.95 4064.35 12696.69
Profit/Loss before Interest and Depreciation (1122.36) 220.36 (1387.97) (388.00)
Interest 30.24 52.18 60.76 77.10
Depreciation 849.90 892.76 994.34 1049.30
Profit before Tax and Extraordinary Items (2013.52) (724.58) (2443.07) (1514.40)
Exceptional Items 0 0 0 0
Provision for Current Tax 0 0 0 0
Deferred Tax 386.07 195.47 386.21 171.21
Profit after Tax (1627.44) (920.05) (2056.86) (1685.62)

PERFORMANCE HIGHLIGHTS

Your Company achieved a gross turnover of Rs.2206.75 Lakhs for theperiod ended March 31 2021 as against Rs. 8143.87 Lakhs for the previous year ended March31 2020. On an annualized basis turnover for the current period ended March 31 2021decreased by 72.03% percent as compared to the previous period.

COVID-19 PANDEMIC

On March 11 2020 the WHO (World Health Organization) declaredCovid-19 outbreak as a pandemic. The lockdowns and restrictions imposed on variousactivities due to COVID-19 pandemic have posed challenges on the businesses of Company. Ason 31st March 2021 the Company faced significant economic uncertainties due to COVID-19which has impacted the operations such as minimal occupancy in hotels and reduction inaverage realization rate per room and revenue from Restaurant & Banquets. The ongoingCOVID-19 pandemic and the worldwide reaction to it has compelled companies to radicallyrethink their strategies and the way they operate. The increasing need among the companiesis to perform tasks on time within budget and with right resources.

APPOINTMENT OF RESOLUTION PROFESSIONAL

National Company Law Tribunal (NCLT) has initiated Corporate InsolvencyResolution Process (CIRP) in respect of Viceroy Hotels Limited ("the Company")under the provisions of the Insolvency and Bankruptcy Code 2016 ("the Code")with effect from March 12 2018.

In this connection Mr. CMA Karuchola Koteswara Rao (IP RegistrationNo. IBBI/IPA-003/IP- N00039/2017-18/10301) was appointed as an Interim ResolutionProfessional (IRP) to carry out the activities relating to CIRP as per the rulesregulations and guidelines prescribed by the Code.

The Committee of Creditors ('COC') in its first meeting held on09/04/2018 appointed Mr. Karuchola Koteswara Rao (who was appointed as IRP pursuant to anorder of the Honorable National Company Law Tribunal Hyderabad Bench ('NCLT') dated 12thMarch 2018) as RP of the company.

During this period the NCLT has prescribed moratorium period forprohibiting all of the following namely:

I. The institution of suits or continuation of pending suits orproceedings against the corporate debtor including execution of any judgment decree ororder in any court of law tribunal arbitration panel or other authority.

II. Transferring encumbering alienating or disposing of by thecorporate debtor any of its assets or any legal right or beneficial interest therein.

III. Any action to foreclose recover or enforce any security interestcreated by the corporate debtor in respect of its property including any action under thesecuritization and reconstruction of financial assets and enforcement of security interestact 2002.

IV. The recovery of any property by owner or lessor where such propertyis occupied by or in the possession of the corporate debtor.

As per Section 17 of the Insolvency and Bankruptcy Code from the dateof appointment of the interim Resolution Professional -

a) the management affairs of the company shall be vested with theresolution professional.

b) the powers of the Board of Directors shall stand suspended and shallbe exercised by the Resolution Professional.

c) the officers and managers of the company shall report to theresolution professional and provide access to such documents and records of the company asmay be required by the resolution professional.

d) the financial institutions maintaining accounts of the company shallact on the instructions of the resolution professional and furnish all informationrelating to the company available with them to the Resolution Professional.

As per the provisions of the Insolvency and Bankruptcy Code 2016 (IBC)the Committee of Creditors of M/ s Viceroy Hotels Limited has been approved by theresolution plan submitted by M/ s CFM Asset Reconstruction Company Private Limited throughe-voting process (19th March 2019 - 4.00 p.m. to 20th March 2019- 4.00 p.m.)identified as a successful resolution applicant subject to the approval of the Hon'bleNCLT Hyderabad bench.

NCLT Hyderabad has issued an order on 01st September 2021rejecting the Resolution Plan submitted by the successful Resolution applicant howeverHonorable High Court of Telangana on 16th September 2021 had ordered forInterim Suspension of such rejection by NCLT.

DIVIDEND

In view of losses incurred by your Company your directors (RP) regretand express their inability to recommend dividend for the period ended March 31 2021.

TRANSFER TO RESERVES

For the financial year ended 31stMarch 2021 the Companyhas not transferred any amount to General Reserve Account.

SUBSIDIARIES

The Company has 5 subsidiaries as on March 31 2021. There has been nomaterial change in the nature of the business of the subsidiaries. The ConsolidatedFinancial Statements prepared by the Company includes the financial information ofsubsidiary companies namely Cafe D Lake Private Limited Crustum Products PrivateLimited Viceroy Chennai Hotels &Resorts Private Limited Minerva HospitalitiesPrivate Limited and Banjara Hospitalities Private Limited.

Cafe D Lake Private Limited:

Cafe D' Lake Private Limited which operates all the restaurantsbusinesses of Minerva Coffee-shop Blue Fox Bar & Restaurant Eat Street and WaterFront has achieved a turnover of Rs. 10.11 crores for the year ended 31st March 2021against Rs.34.27 Crores for previous year. However there was a net Loss of Rs. 2.11Crores for the year ended 31st March 2021 as against the loss of Rs. 6.96 Crores for theprevious years.

During the Financial year under consideration the company cafe D lakehas entered into business purchase agreement with Minerva Grand Hospitalities LLP fortransfer of one of its outlets situated at Ameerpet Hydeabad as a Going concern basis fora net of Assets & Liabilities of Rs. 4251.96/- on 30th October 2020 andalso the company has sold its outlet situated at Madhapur Hyderabad for a net of Assets& Liabilities of Rs. 8756/-

Crustum Products Private Limited:

During the year under review there is no income from operations. Thenet loss for the year ended 31st March 2021 is Rs. 0.23 Lakhs as against net loss of Rs.0.23 Lakhs in the previous year.

Viceroy Chennai Hotels & Resorts Private Limited:

Viceroy Chennai Hotels & Resorts Private Limited has no operationscommenced as on date.

Minerva Hospitalities Private Limited:

Minerva Hospitalities Private Limited has not commenced operations ason date.

Banjara Hospitalities Private Limited

Banjara Hospitalities Private Limited has not commenced operations ason date.

DETAILS OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITSSUBSIDIARIES JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR

During the Financial Year 2020-21 no company ceased to be subsidiaryof the company and your company does not have any associates or joint ventures.

CONSOLIDATED FINANCIAL STATEMENTS

As required pursuant to the provisions of Section 129 of the CompaniesAct 2013 and the Securities and Exchange Board of India (Listing Regulations andDisclosure Requirements) Regulations 2015 the Consolidated Financial Statements of theCompany are prepared in accordance with the Accounting Standards issued by the Instituteof Chartered Accountants of India on the basis of the audited financial statements of theCompany and its subsidiaries.

The Statement containing salient features of the financial statementsof the subsidiaries in Form AOC-1 is attached as 'Annexure I' to this AnnualReport.

BOARD OF DIRECTORS

Consequent to an order of the Honorable National Company Law TribunalHyderabad Bench ('NCLT') dated 12th March 2018 the Company is currently under CorporateInsolvency Resolution Process ('CIRP') as per the provisions of the Insolvency andBankruptcy Code 2016 (IBC) and as per Section 17 of the Code the powers of the Board ofDirectors of Viceroy Hotels Limited (Corporate Debtor) stands suspended and such powersshall be vested with Mr. Karuchola Koteswara Rao Resolution Professional.

KEY MANAGERIAL PERSONNEL

There are changes in the Key managerial Personnel of the Company duringthe year under review. Mr. Dasvanth Kumar Jaya has retired from the post of ChiefFinancial Officer of the company w.e.f 31/05/20 and Mr. Hari Narayana Rao Khandyana wasappointed as Chief Financial Officer of the Company with effect from 29th July 2020 whohas resigned from the office in the August 2021.

Ms N. Sharon Sneha was appointed as Company Secretary wef 3rdDecember 2021 (post the ending of Financial year i.e 31st March 2021)

DECLARATION BY INDEPENDENT DIRECTORS

NOT APPLICABLE since In terms of Section 17 of the Code oncommencement of the Corporate Insolvency Resolution Process (CIRP) the powers of theBoard of Directors of VHL stands suspended and the same are being exercised by Mr.Karuchola Koteswara Rao. The management of the affairs of VHL has been vested with Mr.Karuchola Koteswara Rao.

STATEMENT REGARDING OPINION OF THE BOARD WITH REGARD TO INTEGRITYEXPERTISE AND EXPERIENCE (INCLUDING THE PROFICIENCY) OF THE INDEPENDENT DIRECTORSAPPOINTED DURING THE YEAR: NOT APPLICABLE

MEETINGS

During the year four meetings of the Board of Directors (RP) were heldas more particularly disclosed in the attached Report on Corporate Governance. Theintervening gap between any two meetings was within the prescribed period.

The number and dates of meetings held by the Board (RP) and itsCommittees attendance of Directors and details of remuneration paid to them is givenseparately in Corporate Governance Report in terms of Section 134(3)(b) of the CompaniesAct 2013.

BOARD EVALUATION

As mandated under the Companies Act 2013 and the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the annual performanceevaluation of the Directors individually vis-a-vis the Board and its committees have beencarried out. The manner of such evaluation has been disclosed in the Corporate GovernanceReport.

In terms of Section 17 of the Code on commencement of the CorporateInsolvency Resolution Process (CIRP) the powers of the Board of Directors of VHL standssuspended and the same are being exercised by Mr. Karuchola Koteswara Rao. The managementof the affairs of VHL has been vested with Mr. Karuchola Koteswara Rao.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134 (5) of the Companies Act 2013 your Directors(RP) confirm that to the best of their knowledge and belief and according to theinformation and explanation available to them

I. In the preparation of the annual accounts the applicable accountingstandards have been followed along with proper explanation relating to materialdepartures;

II. Such accounting policies as mentioned in the notes to the financialstatements have been selected and applied consistently and judgments and estimates thatare reasonable and prudent made so as to give a true and fair view of the state of affairsof the Company at the end of the financial year 2020-21 and of the statement of Loss ofthe Company for that period;

III. Proper and sufficient care has been taken 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. The annual accounts for the year 2020-21 have been prepared on agoing concern basis;

V. That the proper internal financial controls were in place and thatthe financial controls were adequate and were operating effectively.

That systems to ensure compliance with the provisions of all applicablelaws were in place and were adequate and operating effectively.

SHARE CAPITAL

The paid up Equity Share Capital as on March 31 2021 was Rs.424052240. During the year under review the company has not issued any shares or anyconvertible instruments.

CHANGE IN NATURE OF BUSINESS

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

MATERIAL CHANGES AND COMMITMENTS

In terms of Section 17 of the Code on commencement of the CorporateInsolvency Resolution Process (CIRP) the powers of the Board of Directors of VHL standssuspended and the same are being exercised by Mr. Karuchola Koteswara Rao. The managementof the affairs of VHL has been vested with Mr. Karuchola Koteswara Rao the Resolutionprofessional.

On March 11 2020 the World Health Organization (WHO) declaredCOVID-19 outbreak as a pandemic. Responding to the potentially serious threat that thispandemic has to public health the Indian Government has taken a series of measures tocontain the outbreak which included imposing multiple 'lock-downs' across the countryfrom March 22 2020 which was extended in in a phased manner till May 31 2020. Allbusinesses and services except those catering towards essential services had been closedduring the period of lockdown. However in order to mitigate the economic and socialhardships induced by the COVID-19 pandemic and resultant lock-down there has been apartial lifting of lock-down and dilution of stringent measures imposed since thebeginning of June 2020. The hotel business has been severely impacted on account ofCOVID-19. Many of the hotels have been closed since the mandated lockdown from March 222020. The Company is currently operating a few hotels with low occupancy and expects allthe hotels to become operational in a staggered manner depending upon the businessenvironment.

The Company is taking all necessary measures to contain costsrationalise resources taking initiatives to uplift revenue which includes invoking forcemajeure condition in the lease/license agreements in respect of leased/licenses hotelproperties for waiver or deferment of lease rentals during the lockdown period holdingback on discretionary spending postponing renovations and implementing various costoptimization measures.

The Company has assessed the potential impact of Covid-19 on thecarrying value of property plant and equipment right of use assets intangible assetsinvestments trade receivables inventories and other current assets appearing in thefinancial statements of the Company. In developing the assumptions and estimates relatingto the future uncertainties in the economic conditions because of this pandemic thecompany has used internal and external sources of information and based on currentestimates expects to recover the carrying amounts of these assets and do not foresee anyimpairment in the values of these assets.

POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND OTHER DETAILS

The Board has on the recommendation of the Nomination and RemunerationCommittee framed a policy for selection and appointment of Directors and Senior Managementpersonnel and fix their remuneration. The Remuneration Policy is posted on the website ofthe Company at the link:www.viceroyhotels.in

PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS

The particulars of loans guarantees and investments under section 186of Companies Act.2013 have been disclosed in the financial statements.

ANNUAL RETURN:

A Copy of Annual Return of your Company in terms of section 92(3) ofthe Companies Act 2013 is placed on the website of the Company at www.viceroyhotels.in

PARTICULARS OF EMPLOYEES

In terms of the provisions of Section 197(12) of the Companies Act2013 read with Rule 5(2) and 5(3) of the Companies (Appointment & Remuneration ofManagerial Personnel) Rules 2014 a statement showing the names and other particulars ofthe employees drawing remuneration in excess of the limits set out in the said rules areprovided in 'Annexure VI' to this report.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Board has adopted policies and procedures for ensuring the orderlyand efficient conduct of its business including adherence to the Company's policiessafeguarding of its assets prevention and detection of frauds and errors accuracy andcompleteness of the accounting records and timely preparation of reliable financialdisclosures.

The details in respect of internal financial control and their adequacyare included in the Management Discussion & Analysis which forms part of this report.

STATUTORY AUDITORS

M/s. P C N & Associates. Chartered Accountants Firm'sRegistration number: 016016S were appointed as Statutory Auditors of the Company for aperiod of 5 Years from the Conclusion of 52nd Annual General Meeting of the Company tillthe conclusion of 57th Annual General Meeting of the Company subject to ratification bymembers in every Annual General Meeting.

However with the introduction of provisions of companies (Amendment)Act 2017 ratification of appointment of Statutory Auditor has been omitted with effectfrom 7th May 2018. Hence the agenda for ratification of appointment of M/ s.P C N & Associates. Chartered Accountants as Statutory Auditors has not beenproposed in the Notice convening the Annual General Meeting.

With reference to observations made in Auditor's report the notes ofaccount is self-explanatory and therefore do not call for any further comments. Theresults for the year ended March 31 2021 have been subjected to an audit by the StatutoryAuditors of the company and a qualified report has been issued by them thereon.

Qualifications of Auditor for the year 2020-21:

1. Capital Work In progress: The Company has converted capital work inprogress into Fixed Assets during the F.Y 2017-18 of an amount of Rs.111.94 Crores.However the company has not submitted us any valuation certificate towards capitalizationof fixed assets of Rs.111.94 crores and the depreciation claimed by the company towardssuch capitalization of fixed assets for the F.Y 2017-18 is Rs.358.34 Lakhs F.Y 2018-19Rs.599.98 Lakhs and FY 2019-20 is Rs. 601.63 Lakhs and for the FY 2020-21 is 601.63 lakhswhich increase the Loss to that Extent. As we could not obtain sufficient audit evidencein this regard and the capitalization is not in compliance with the generally acceptedaccounting principles we are unable to comment upon the true and fair view of the same.(Refer Note no.27)

MANAGEMENT REPLY

The company has passed board resolution on 26-08-2017 for convertingCapital work in progress of Rs. 111 .94 Crores to fixed assets. The depreciation claimedby the company on capitalization of fixed assets for the F.Y 2017-18 is Rs.358.34 LakhsF.Y 2018-19 Rs.599.98 Lakhs and FY 2019-20 is Rs. 601.63 Lakhs

2. Forfeiture of advance: The Company has forfeited an advance ofamounting to Rs.134.65 Crores received from Mahal Hotel Private Limited BhagyanagarInvestments and trading private limited and Ganga Industrial Corporation Limited in theF.Y 2013-14 and adjusted in slump sale proceeds as disclosed in the annual report of F.Y2013-14. In the financial year 2017-18 again the company has recognized the forfeitedadvances in the books of accounts as liability which is not in line with the IND ASaccounting policies also the management of the company has not provided us any supportingdocument towards re recognition of such advances as liability in the books of accounts inthe F.Y 2017-18. As per the Business transfer agreement (BTA) entered between ViceroyHotels Limited and Mahal Hotels Limited dated 02nd April 2011 the company M/s ViceroyHotels Ltd received an advance of Rs.124.52 Crores (Included in above said advanceRs.134.65 Crores). The date of termination of the agreement is 31.12.2011. In the eventof termination the company is liable to repay the advance along with the interest @2% permonth till the date of repayment. However no interest has been paid or provided by thecompany in its Books of Accounts since the termination of the agreement which is not inline with the accounting principles. Hence we are unable to comment upon the true and fairview of the same. (Note No:47)

MANAGEMENT REPLY:

The company has forfeited an amount of Advance of Rs.134.65 croreserroneously in the Financial year 2013-14 (Bhagyanagar Investment &Trading PrivateLimited- Rs.11.77 Crores Ganga Industrial Corporation- Rs.0.65 Crores Mahal HotelPrivate Limited Rs.122.23 crores) and the same is taken back into the Books as ExceptionalItem in the F.Y2017-18.

3. Directorate of Enforcement: The Directorate of Enforcement made aProvisional Attachment Order in PAO No. 04/2019 dated 26.03.2019 passed by the DeputyDirector Directorate of Enforcement against the M/s Viceroy Hotels Limited of OCNo.1118/2019 pending adjudication before the Honourable Adjudicating Authority PMLA2002 from alienating the proceeds of crime in the form of movable and immovableproperties which are involved in money laundering and the non-attachment may seriouslyaffect and frustrate the proceedings under PMLA 2002. The Directorate of Enforcement hasalso filed an application under Insolvency and Bankruptcy code 2016 against M/s ViceroyHotels Limited in respect advances taken from Mahal Hotels Ltd and the same has beenaccepted by the Hon'ble NCLT on dated 06-05-2019. The resolution professional haschallenged the provisional attachment order of Enforcement Directorate Chennai beforethe Hon'ble NCLT Hyderabad on 08-04-2019. NCLT has raised the attachment of EnforcementDirectorate Chennai. Subsequently Directorate of Enforcement Chennai has gone to HighCourt Chennai vide their writ petition number: WP/29970/2019 which was declared in theirfavour. Then the resolution professional of Viceroy Hotels Limited has approached SupremeCourt and at present it is pending at Supreme Court. vide order no SLP(C) no. 008259/2020.

MANAGEMENT REPLY

The company has received provisional attachment of immovable andmovable properties having a value of Rs. 315.50 Crores from Directorate of EnforcementChennai on 26.03.2019.

The resolution professional has challenged the provisional attachmentorder of Enforcement Directorate Chennai before the Hon'ble NCLT Hyderabad on08-04-2019. NCLT has raised the attachment of Enforcement Directorate Chennai.

Further as per the Hon'ble NCLT Hyderabad order dated 11.07.2019declared that immovable and movable properties of Viceroy Hotels limited can't be attachedby the Enforcement Directorate - Chennai when the company is under Corporate InsolvencyResolution Process ("CIRP").

Subsequently Directorate of Enforcement Chennai has gone to HighCourt Chennai vide their writ petition number: WP/29970/2019 which was declared in theirfavour. Then the resolution professional of Viceroy Hotels Limited has approached SupremeCourt vide registration number. SLP(C) no. 008259/2020 which is pending at the SupremeCourt.

4. NCLT: The Asset Reconstruction Company (India) Ltd (ARCIL) has filedplea under Sec.7 of The Insolvency and Bankruptcy code 2016 against M/s Viceroy HotelsLimited for non payment of dues and the same has been accepted by the Hon'ble NCLT.Further proceedings are subject to NCLT order. The Resolution Professional has invitedExpression of Interest from the prospective bidders for submission of Resolution Plans forrevival of the Company. In terms of provisions of the Insolvency and Bankruptcy Code 2016(IBC) the resolution plan submitted by M/s CFM Asset Reconstruction Company PrivateLimited for M/s Viceroy Hotels Limited has been approved by the Committee of Creditors(COC) of the company in its 18th COC meeting and identified as a successful resolutionapplicant subject to the approval of the Hon'ble NCLT Hyderabad bench. (Note No: 42)

MANAGEMENT REPLY

As per the provisions of the Insolvency and Bankruptcy Code 2016 (IBC)the Committee of Creditors of M/ s Viceroy Hotels Limited has been approved by theresolution plan submitted by M/s CFM Asset Reconstruction Company Private Limited in its18th COC through e-voting process identified as a successful resolution applicant subjectto approval of the Hon'ble NCLT Hyderabad bench.

5. Loans from Banks or Financial Institutions: During the currentFinancial Year the company has not provided interest on the loans obtained from variousBanks and financial Institutions which is not in accordance with generally acceptedaccounting principles. Confirmations from Banks/Financial Institutions are not yetreceived in this regard due to the non provision of interest in the financial statements;the financial statements may not give a true and fair view in this regard.(Note No:49)

MANAGEMENT REPLY

As the loans turned as Non-Operating Assets there is no correspondencefrom the banks and financial institutions regarding the interest provision hence as aresult the company could not provide for the interest expense during the year.

6. Statutory Dues: The Company has not paid the statutory dues fora period more than 6 months is as follows as per the Books and records verified by us ason 31-03-2021.

S.No Particulars Amount In Rs.
1 TDS 33420321/-
Total 33420321/-

MANAGEMENT REPLY

The Company is in the process of clearing outstanding statutory dues.

7. Non availability of confirmations Trade Receivables Trade Payables- In the absence of alternative corroborative evidence we are unable to comment on theextent to which such balances are recoverable.(Note :45)

MANAGEMENT REPLY

The company is in the process of obtaining the confirmation from them.

8. Exceptional items: The management decided to written off variousassets capital work in progress etc for an amount of Rs. 291.94 crores in the F.Y 2017-18for which there is no provision has made for such amount up to F.Y 2016-17 . As there isno sufficient appropriate audit evidence for such written off we are unable to commenton the True and Fair Value of such written off.(Refer Note No:28)

MANAGEMENT REPLY

The Company has passed board resolution on 14-02-2018 for Writing offvarious Assets Liabilities Incomes and Expenses.

9. In respect of investment in subsidiaries those have significantaccumulated Losses as on March 31st 2021 and the Loans and advances given to thosesubsidiaries. The Management of the company is of the view that the 100 percent provisionfor made for Loss of such investments in the Profit &Loss account made in this regard.In the absence of fair valuation of those investments in the subsidiaries we are unableto comment on the total provision made by the company in this regard. we are unable tocomment upon the carrying value of these investments recoverability of loans and advancesand the consequential impact if any on the consolidated financial statements. We areunable to comment on the provisions if any required for the corporate guarantees given toits

Subsidiary Companies and the provision for interest of loans andadvances given to such subsidiaries.(Note No: 50)

MANAGEMENT REPLY

The company believes investments in subsidiaries has been eroded fullyhave made provision.

10. Tax Disputes: The company has material tax disputes with the IncomeTax department service tax and sales tax departments as given under which is as per theinformation submitted by the management in this regard. However the company has not madeprovision for such dues in the financial statements for the year ending 31-03-2021. As perthe information and explanation submitted by the company to us the following are the casespending at different levels. (Note No: 37)

Name of the Statue Nature of Dues Section under which order is passed Amount (Rs) Period to which it relates Case is pending at
Income Tax Act 1961 Income Tax 154 Rs.537832209/- A.Y 2014-15 Commissioner of Income Tax (Appeals)
Income Tax Act 1961 Income Tax 143(3) Rs.92044470/- A.Y 2016-17 Commissioner of Income Tax (Appeals)
Income Tax Act 1961 Income Tax 143(3) Rs.91407210/- A.Y 2017-18 Commissioner of Income Tax (Appeals)

MANAGEMENT REPLY

It is not possible to predict the outcome of the pending litigationswith accuracy the company believes based on legal opinions received that it hasmeritorious defenses to the claims. The management believes the pending actions will notrequire outflow of resources embodying economic benefits and will not have a materialadverse effect upon the results of the operations cash flows or financial condition ofthe company.

11. Going Concern The above conditions indicate the existence ofmaterial uncertainties which may caste significant doubt on the Company's abilities tocontinue as going concern. In the event that the going concern assumption of the companyis inappropriate adjustments will have to be made as not a going concern. However thefinancials has not been made with such adjustments for the F.Y 2020-21.(Note No:48)

Management believes the status of going concern is not affected and isconfident of maintaining the going concern status and is undergoing the process of IBCCode 2016. The final status can be known on approval of resolution plan.

12. The company has not appointed company secretary for the FinancialYear 2020-21 which is not in compliance of the provisions of Sec 203 of the Companies Act2013.(Note No:46)

The Company could not appoint the Company Secretary during thefinancial 2020-21 However Ms. N. Sharon Sneha has been appointed as the CompanySecretary/Compliance Officer with effective from 03rd December 2021.

Further the Auditors' Report for the financial year ended 31st March2021 is appended herewith for your kind perusal and information.

DETAILS OF FRAUDS REPORTED BY AUDITORS:

During the period under review there were no frauds reported to theCentral Government by the statutory Auditors under Section 143(12) of the Companies Act2013.

INTERNAL AUDITORS

The Board (RP) has re-appointed M/s. Sriramamurthy & Co CharteredAccountants as the Internal Auditors of your Company. The Internal Auditors aresubmitting their reports on Quarterly basis. The remuneration of internal auditor's as maybe mutually agreed upon between the Board (RP) of the Company and Internal Auditors.

SECRETARIAL AUDIT

Pursuant to provisions of Section 204 of the Companies Act 2013 readwith Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theBoard (RP) has appointed Ms. Soumya D afthardar Practicing Company Secretary to conductSecretarial Audit for the financial year 2020-21. The Secretarial Audit Report pursuantto Section 204(1) of the Companies Act 2013

for the financial year ended 31st March 2021 is given in 'AnnexureV' attached hereto and forms part of this Report.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has formulated a Whistle Blower Policy in terms of Section177 of the Companies Act

2013 as per Regulation 22 of the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 and Securitiesand Exchange Board of India (Prohibition of Insider Trading) Regulation 2015. For theemployees to report their grievances / concerns about instances of unethical behavioractual or suspected fraud or violation of Company's Code of Conduct by means of ProtectedDisclosure to the Authorized Officer or the Chairman of the Audit Committee.

The vigil mechanism / whistle blower policy may be accessed on theCompany's website at the link: www.viceroyhotels.in.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION

The details of conservation of energy are given in ManagementDiscussion & Analysis.

FOREIGN EXCHANGE EARNINGS AND OUTGO

As required under Section 134(3) (m) of the Act read with Rule 8 ofthe Companies (Accounts) Rules

2014 the information relating to foreign exchange earnings andexpenses is set out in Notes 34 and 35 of the Notes to the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTY

All related party transactions that were entered into during thefinancial year were at an arm's length basis and were in the ordinary course of business.There are no materially significant related party transactions made by the Company withPromoters Directors Key Managerial Personnel or other designated persons which may havea potential conflict with the interest of the Company at large.

During the year all Related Party Transactions were placed before theAudit Committee and also to the Board for approval. Prior omnibus approval of the AuditCommittee was obtained for the transactions which were of a foreseen and repetitivenature.

The Policy on Related Party Transactions as approved by the Board ofDirectors of the Company is uploaded on the website of the Company and the same can beaccessed at the link: www.viceroyhotels.in

The particulars of contracts or arrangements with related partiesreferred to in sub-section (1) of Section 188 of the Companies Act 2013 in Form AOC-2and disclosures under Schedule V of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 is annexed as 'Annexure II'to this report.

INSIDER TRADING

Pursuant to SEBI (Prohibition of Insider Trading) Regulations 2015the code of Conduct and Code on Fair Disclosure and these code are available on thewebsite of the company (URL: www.viceroyhotels.in).

DEVELOPMENT AND IMPLEMENTATION OF A RISK MANAGEMENT POLICY FOR THECOMPANY INCLUDING IDENTIFICATION THEREIN OF ELEMENTS OF RISK IF ANY WHICH IN THE OPINIONOF THE BOARD MAY THREATEN THE EXISTENCE OF THE COMPANY

The company has risk management mechanism and policy in place whichmitigates the risk at appropriate situations and there are no elements of risk which inopinion of board of directors may threaten the existence of the company.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS ORCOURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND THE COMPANY'S OPERATIONS INFUTURE

The application filed by the Asset Reconstruction Company (India) Ltd(ARCIL) against the company under Sec. 7 of The Insolvency Bankruptcy Code 2016 has beenapproved by the Honorable National Company Law Tribunal Hyderabad Bench('NCLT') dated12th March 2018. The Committee of Creditors meeting was conducted and a ResolutionProfessional was appointed.

Consequent to an order of the Honorable National Company Law TribunalHyderabad Bench ('NCLT') dated 12th March 2018 the Company is currently under CorporateInsolvency Resolution Process ('CIRP') as per the provisions of the Insolvency andBankruptcy Code 2016 (IBC) and as per Section 17 of the Code the powers of the Board ofDirectors of Viceroy Hotels Limited (Corporate Debtor) stands suspended and such powersshall be vested with Mr. Karuchola Koteswara Rao Resolution Professional.

NCLT Hyderabad has issued an order on 1st September 2021rejecting the Resolution plan submitted by the CFM however on appeal made to HonorableHigh court of Telangana on 16th September 2021 it had ordered for suspensionof such rejection by NCLT.

Further there are no significant material orders passed by theRegulators which would impact the going concern status of the Company and its futureoperations.

FIXED DEPOSITS

Your Company has not accepted any fixed deposits and as such noprincipal or interest was outstanding as on the date of the Balance Sheet.

DEPOSITS

The Company has not accepted any deposits within the meaning of Section73 of the Companies Act 2013 read with the Companies (Acceptance of Deposits) Rules2014. There are no unpaid or unclaimed deposits as the Company has never accepted depositswithin the meaning of the said Act and the rules made there under.

MAINTENANCE OF COST RECORDS AND COST AUDIT:

Pursuant to Section 148 of the Companies Act 2013 maintenance of Costrecords and Cost Audit is not applicable to the Company.

MANAGEMENT DISCUSSION & ANALYSIS

The Management Discussion and Analysis as required under Schedule V ofthe Listing Regulations forms an integral part of this report.

CORPORATE SOCIAL RESPONSIBILITY

The Company has not developed and implemented any Corporate SocialResponsibility initiatives as section 135 and rules made there under are not applicable tothe company.

CORPORATE GOVERNANCE

Your Company practices a culture that is built on core values andethical governance practices and is committed to transparency in all its dealings. AReport on Corporate Governance along with a Certificate from the Statutory Auditors of theCompany regarding compliance with the conditions of Corporate Governance as stipulated inRegulations 17 to 27 clauses (b) to (i) of sub-regulation (2) of

Regulation 46 and paragraphs C D and E of Schedule V of the Securitiesand Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 is annexed to this Report.

HUMAN RESOURCES

Y our Company considers its Human Resource as the major strength toachieve its objectives. Keeping this in view your Company takes all the care to attracttrain and retain well qualified and deserving employees. The employees are sufficientlyempowered and enabled to work in an environment that inspires them to achieve higherlevels of performance. The unflinching commitment of the employees is the driving forcebehind fulfilling the Company's vision. Your Company appreciates the contribution of itsdedicated employees.

SECRETARIAL STANDARDS DISCLOSURE:

During the year under review the Company has complied with theapplicable Secretarial Standards issued by The Institute of Company Secretaries of India.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMAN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013

The Company has in place an Anti-Sexual Harassment Policy in line withthe requirements of the Sexual Harassment of Women at the Workplace (PreventionProhibition & Redressal) Act 2013. Internal Complaints Committee (ICC) has been setup to redress complaints received regarding sexual harassment. All employees (permanentcontractual temporary trainees) are covered under this policy.

The following is a summary of sexual harassment complaints received anddisposed of during the year:

No. of Complaints received: Nil No. of Complaints disposed of: Nil

DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THEINSOLVENCY AND BANKRUPTCY CODE 2016 DURING THE YEAR ALONG WITH THEIR STATUS AS AT THE ENDOF THE FINANCIAL YEAR:

During the year under review the Company has not made any applicationand there is no pending proceeding under Insolvency and Bankruptcy Code 2016.

DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIMEOF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS ORFINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF:

During the year under review the Company has not taken any loan fromany bank or Financial Institution.

ACKNOWLEDGMENTS

Your Directors express their sincere appreciation to the customersmembers dealers employees bankers State and Central Government Stock Exchanges andall stakeholders for their co-operation and confidence reposed in the Company.

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