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Viji Finance Ltd.

BSE: 537820 Sector: Financials
NSE: VIJIFIN ISIN Code: INE159N01027
BSE 15:10 | 26 Oct 2.90 0.13
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2.90

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2.79

NSE 15:09 | 26 Oct 2.70 0.10
(3.85%)
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2.70

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2.70

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OPEN 2.90
PREVIOUS CLOSE 2.77
VOLUME 173218
52-Week high 2.90
52-Week low 0.40
P/E 58.00
Mkt Cap.(Rs cr) 24
Buy Price 2.90
Buy Qty 71330.00
Sell Price 0.00
Sell Qty 0.00
OPEN 2.90
CLOSE 2.77
VOLUME 173218
52-Week high 2.90
52-Week low 0.40
P/E 58.00
Mkt Cap.(Rs cr) 24
Buy Price 2.90
Buy Qty 71330.00
Sell Price 0.00
Sell Qty 0.00

Viji Finance Ltd. (VIJIFIN) - Director Report

Company director report

Dear Shareholders

Your Directors present their Report together with the Audited Financial Statements ofyour company for the year ended March 31 2020.

1. STATE OF AFFAIRS FINANCIAL PERFORMANCE AND FUTURE OUTLOOK:

1.1 FINANCIAL HIGHLIGHTS AND SUMMARY OF STANDALONE AND CONSOLIDATED AUDITED FINANCIALSTATEMENTS

The performance highlights and summarized financial results of the Company are givenbelow:

(Rupees in Lakhs except EPS)

Particulars

Standalone

Consolidated

Year ended Year ended Year ended Year ended
31st March 2020 31st March 2019 31st March 2020 31st March 2019
Total Income 98.91 175.74 99.94 176.29
Total Expenditure 79.44 108.35 80.70 108.77
Profit/Loss before tax 19.47 67.39 19.24 67.52
Provision for Tax
Current Tax 5.06 23.71 5.07 23.75
Deferred Tax 0.21 0.33 0.86 0.98
Earlier Year Tax 0.00 9.60 0.00 9.60
Profit/Loss after tax 14.20 33.75 13.31 33.19
Amount available for appropriation 14.20 33.75 13.31 33.19
Appropriations:
(a) Transferred to Statutory Reserve 2.84 6.75 2.84 6.75
(b) Proposed Dividend on Equity Shares 0.00 0.00 0.00 0.00
(c) Tax on Proposed Dividend 0.00 0.00 0.00 0.00
Surplus Carried to Balance Sheet 11.36 27.00 10.47 26.44
Paid up Equity Share Capital 825 825 825 825
Earnings per share (Re.1/-) Basic & Diluted (in Rs.) 0.02 0.04 0.02 0.04

1.2 OPERATION AND STATE OF COMPANY AFFAIRS:

The Company is a Non Banking Financial Company (NBFC Company) engaged in providingfinance. The Company is registered as a Non-Systemically Important Non Deposit AcceptingNBFCs as defined under Section 45 IA of the Reserve Bank of India vide Certificate No.03-00080 dated 29th October 1998. During the financial year 2019-20 Company has totalincome of Rs. 98.91 Lacs in comparison to previous year's total income of Rs.175.74 Lacson standalone basis and earned net profit of Rs. 14.20Lacs in comparison to previousyear's net profit of Rs.33.75 Lacs.

On a Consolidated Basis total income of Rs. 99.94 Lacs in comparison to previousyear's total income Rs.176.29 Lacs and earned net profit of Rs. 13.31 Lacs in comparisonto previous year's net profit of Rs. 33.19 Lacs.

1.3 IMPACT ON BUSINESS OPERATIONS OF YOUR COMPANY ON ACCOUNT OF COVID-19 PANDEMIC

COVID-19 outbreak was declared a pandemic by the World Health Organization on March 112020. The Indian Government announced a 21-day complete lockdown on March 24 2020 acrossthe country to contain the spread of the virus. The lockdown was thereafter extended fromtime to time with gradual relaxations. Our Company being an NBFC found it difficult tomanage the cash flows including our operating expenses and also faced many challenge inthe debt servicing and to sustain the operations of company during lockdown.

1.4 CHANGE IN NATURE OF BUSINESS

Company is engaged in NBFC activities only and during the year there was no change inbusiness activities of the company.

1.5 SHARE CAPITAL

The Paid-up Equity Share Capital as at 31st March 2020 stood at Rs. 8.25crores. The company has not issued shares with differential voting rights nor has grantedany stock option or sweat equity shares. As on 31st March 2020 none of theDirectors of the company hold instruments convertible into equity shares of the Company.

1.6 ADOPTION OF IND-AS

The Company has adopted Ind-AS from 1st April 2019 with effectivetransition date of 1st April 2018 pursuant to MCA notification dated 31stMarch 2016 and financial statements has been prepared in accordance with Division III ofSchedule III of Companies Act 2013 notified by MCA on 11th October 2018. Thefinancial statements up to year ended 31st March 2018 were prepared inaccordance with the erstwhile accounting standards notified under the Act read with Rule 7of Companies (Accounts) Rules 2014 (as amended) and other generally accepted accountingprinciples in India. Accordingly the impact of transition has been recorded in theopening reserves as on 1st April 2018 and the corresponding adjustmentspertaining to comparative previous period have been restated/reclassified in order toconfirm to current period presentation. Further the Company follows the statutoryrequirements circulars and guidelines issued by the Reserve Bank of India (RBI) forNonBanking Financial Companies (NBFC) from time to time.

1.7 CORPORATE GOVERNANCE

As on 31st March 2019 paid- up capital of the Company was less than Rs. 10Crores and Net worth was less than Rs. 25 Crores; therefore the provisions of theCorporate Governance as stipulated under Regulation 15 of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 were not applicable to the Company for thefinancial year ended 31st March 2020. Hence Corporate Governance Report isnot required to be disclosed with Annual Report. It is pertinent to mention that theCompany follows majority of the provisions of the corporate governance voluntarily as apart of Good Corporate Governance.

2. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT-9 as requiredunder Section 92 of the Companies Act 2013 is annexed as Annexure - A and formsan integral part of this Report and is also available on website of the company atwww.vijifinance.com.

3. COMPOSITION OF BOARD OF DIRECTORS COMMITTEES AND NUMBER OF MEETINGS OF BOARD ANDITS COMMITTEES

I. BOARD OF DIRECTORS

The Composition of the Board is in conformity with Section 149 of the Companies Act2013 ("the Act"). The Board of your Company comprises of Four Directors as on 31stMarch 2020. Independent Directors are non-executive directors as defined under Regulation16(1)(b) of the SEBI Listing Regulations read with Section 149(6) of the Companies Act2013. The maximum tenure of independent directors is in compliance with the Act and allthe Independent Directors have confirmed that they meet the criteria as mentioned underRegulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 and Section 149(6) of the Companies Act 2013.

During the Financial Year 2019-20 six (6) Board Meetings were held i.e. on 29thMay 2019 26th June 2019 27* August 2019 11*1 September 201905th November 2019 and 11th February 2020 respectively and gapbetween two meetings did not exceed 120 days. Proper notices for meeting was given and theproceedings were properly recorded and Draft Minutes of Board Meeting were circulated tomembers of the Board for their comments.

Composition and Attendance of Directors at the meetings during the financial year2019-20 are mentioned in the table below:

S.No. Name of Director Category

No. of Board Meetings

Attendance at the previous AGM held on 27th September 2019
Held during their tenure Attended
1. Mr. Vijay Kothari (DIN: 00172878) Promoter & Managing Director 6 6 Yes
2. Mr. Suresh Singh Jain (DIN:03584190) Independent/Non- Executive Director 6 6 Yes
3. Mr. Ashish Verma (DIN: 07665222) Independent/Non- Executive Director 6 6 Yes
4. Mrs. Juhee Verma (DIN:07691682) Independent/Non- Executive Director 6 6 Yes

II. AUDIT COMMITTEE

The company has constituted an Audit Committee as per requirement of Section 177 of theCompanies Act 2013. The terms of reference of Audit Committee are broadly in accordancewith the provisions of the Companies Act 2013.During the year the committee met on fiveoccasions on following dates viz. 29th May 2019 27th August 2019 11thSeptember 2019 05th November 2019 and 11th February 2020.

Composition and Attendance of Members at the meetings of the Audit Committee heldduring the financial year 2019-20 are mentioned in the table below:

S.No Name of Member Category Designation Meeting held during the tenure of the Director Meetings Attended
1 Mr. Suresh Singh Jain (DIN:03584190) Independent/Non- Executive Director Chairperson 5 5
2 Mrs. Juhee Verma (DIN:07691682) Independent/Non- Executive Director Member 5 5
3 Mr. Ashish Verma (DIN: 07665222) Independent/Non- Executive Director Member 5 5

III. NOMINATION AND REMUNERATION COMMITTEE

The company has constituted Nomination and Remuneration Committee as per requirement ofSection 178 of the Companies Act 2013. The terms of reference of Nomination andRemuneration Committee are broadly in accordance with the provisions of the Companies Act2013.During the year the committee met on two occasions on following dates viz. 29th May2019 and 27th August 2019.

Composition and Attendance of Members at the meetings of the Nomination andRemuneration Committee held during the financial year 2019-20 are mentioned in the tablebelow:

S.No Name of Member Category Designation Meeting held during the tenure of the Director Meetings Attended
1 Mr. Suresh Singh Jain (DIN:03584190) Independent/Non- Executive Director Chairperson 2 2
2 Mrs. Juhee Verma (DIN:07691682) Independent/Non- Executive Director Member 2 2
3 Mr. Ashish Verma (DIN:07665222) Independent/Non- Executive Director Member 2 2

IV. STAKEHOLDERS RELATIONSHIP COMMITTEE

The company has constituted Stakeholders Relationship Committee to redress complaintsof Shareholders. During the year the committee met on two occasions on following datesviz. 29th May 2019 and 27th August 2019.

Composition and Attendance of Members at the meetings of the Stakeholders RelationshipCommittee held during the financial year 2019-20 are mentioned in the table below:

S.No Name of Member Category Designation Meeting held during the tenure of the Director Meetings Attended
1 Mr. Suresh Singh Jain (DIN:03584190) Independent/Non- Executive Director Chairperson 2 2
2 Mrs. Juhee Verma (DIN:07691682) Independent/Non- Executive Director Member 2 2
3 Mr. Ashish Verma (DIN: 07665222) Independent/Non- Executive Director Member 2 2

4. DIVIDEND

During the year under review your Directors have not recommended any dividend due tothe downfall in the turnover of the Company. The Company is deploying the funds in furtherbusiness development and to combat the current uncertainties in the finance industry.

TRANSFER UNPAID/UNCLAIMED DIVIDENDAMOUNT TO INVESTOR EDUCATION AND PROTECTION FUND:

The Ministry of Corporate Affairs (‘MCA') has notified the provisions of Section124 of the Companies Act 2013 (‘Act 2013) and the Investor Education and ProtectionFund Authority (Accounting Audit Transfer and Refund) Rules 2016 ("IEPFRULES") w.e.f. 07.09.2016. Under Section 124(5) of the Companies Act 2013 dividendsthat are unclaimed/unpaid for a period of seven years are to be transferred statutorilyto the Investor Education and Protection Fund (IEPF) administered by the CentralGovernment. To ensure maximum disbursement of unclaimed dividend the Company sendsreminders to the concerned investors at appropriate intervals.

The Members of the Company who have not yet encashed their dividend warrant(s) for theF.Y. 2013-14 and onwards may write to the Company/Registrar & Share Transfer Agentimmediately.

Pursuant to Section 124(5) of the Companies Act 2013 the unpaid dividends that aredue for transfer to the Investor Education and Protection Fund are as follows:

Financial Year Date of Declaration Due date of transfer unpaid dividend to IEPF
2013-14 09.09.2014 15.10.2021
2014-15 17.09.2015 23.10.2022
2015-16 26.09.2016 01.11.2023
2016-17 31.07.2017 05.09.2024
2017-18 28.09.2018 03.10.2025

Members who have not encashed their dividend warrants pertaining to the aforesaid yearsmay approach the Company/Registrar for obtaining payments thereof at least 30 days beforethey are due for transfer to the said fund.

The Company has uploaded the details of unpaid and unclaimed amounts lying with theCompany as on 31stMarch 2019 on the Company's website at www.vijifinance.com and on thewebsite of the Ministry of Corporate Affairs at www.iepf.gov.in.

TRANSFER OF AMOUNTS/SHARE TO INVESTOR EDUCATION AND PROTECTION FUND:

Pursuant to the provisions of Sections 124 and 125 of the Companies Act 2013 read withthe IEPF (Accounting Audit Transfer and Refund) Rules 2016 dividend / interest /refund of applications which remains unclaimed/unpaid for a period of 7 years is requiredto be transferred to IEPF. Further the IEPF Rules mandate the companies to transfer allshares on which dividend remains unclaimed/unpaid for a period of 7 consecutive years tothe demat account of the IEPF Authority.

Accordingly during the Financial Year 2019-20 unpaid/ unclaimed dividends of Rs.104400/- relating to financial year 2011-12 were transferred to the Investor Educationand Protection Fund and 30000 equity shares in respect of which dividend has not beenpaid or claimed by the shareholders for seven consecutive years or more shall also betransferred to IEPF Authority.

The Members/claimants whose shares or unclaimed dividends get transferred to IEPF mayclaim the shares or apply for refund from the IEPF Authority by following the refundprocedure as detailed on the website of IEPF Authority atwww.iepf.gov.in/IEPF/refund.html.

DETAILS OF NODAL OFFICER:

The details of Nodal Officer appointed by the Company pursuant to the provisions ofIEPF Rules are available on the website of the company:http://viiifinance.com/investors-relations/.

5. AMOUNTS TRANSFERRED TO RESERVES

Being an Non Banking Finance Company 20% of the profit i.e.Rs. 283959/- has beentransferred to statutory reserve of the company.

6. DEPOSITS

The Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 read with the Companies (Acceptance of Deposits) Rules 2014.However being a Non-Banking Financial Company the disclosures required as per Rule 8(5)(v) and (vi) of the Companies (Accounts) Rules 2014 read with Sections 73 and 74 ofthe Companies Act 2013 are not applicable to the Company.

UNSECURED LOAN FROM DIRECTOR:

The Company has received unsecured loan amounting Rs.16400000/- from Mr. VijayKothari Managing Director of the Company during the financial year ended 31st March2020. FurtherRs. 35727006/- was outstanding to be repaid to Mr. Vijay Kothari as on31st March 2020.

7. RBI NORMS

Your Company is a Non-Deposit Taking Non-Systemically Important Non-Banking FinancialCompany. The Company continues to fulfill all the norms and standards laid down by theReserve Bank of India (RBI) pertaining to capital adequacy statutory liquidity ratio etc.Further the company has made provision of Rs. 984555/- for Non-performing Assets as on31st March 2020.Certificate from statutory auditors for complying the prudential normsfor NBFC is attached with Audit Report.

7.1 KNOW YOUR CUSTOMER AND ANTI MONEY LAUNDERING MEASURE POLICY:

Your board has approved the Know Your Customer and Anti Money Laundering Policy (KYCand PMLA Policy) in accordance with RBI Guidelines. Company also adheres to the compliancerequirement in terms of the said policy including the monitoring and reporting of cash andsuspicious transactions. There were no suspicious transactions noticed during the period.

7.2 FAIR PRACTICE CODE:

Your company has in place a fair practice code (FPC) as per RBI Regulations whichincludes guidelines from appropriate staff conduct when dealing with the customers and onthe organizations policies vis-a-vis client protection. Your company and its employeesduly complied with the provisions of FPC.

8. SUBSIDIARY COMPANIES JOINT VENTURE OR ASSOCIATE COMPANIES

Your Company has two wholly owned Subsidiaries i.e. S.L.Developers Private Limited andViji Housing Finance Limited. Financials to the Subsidiaries are disclosed in theConsolidated Financial Statements which form part of this Annual Report. Aseparatestatement containing salient features of the Financial Statements of the Subsidiaries inaccordance with Section 129(3) of the Companies Act 2013 and the rules made thereunder inthe prescribed Form AOC-1 are annexed to this Report as ANNEXURE-B and hence is notrepeated here for sake of brevity. The Company does not have any joint venture orassociate Company.

In accordance with fourth proviso to Section 136(1) of the Companies Act 2013 theAnnual Report of your Company containing inter alia the audited standalone andconsolidated financial statements has been placed on the website of the Company at www.vijifinance.com.Further audited financial statements together with related information and otherreports of each of the subsidiary companies have also been placed on the website of theCompany at weblink: http://vijifinance.com/financial-report/.

In terms of Section 136 of the Companies Act 2013 (‘the Act') financialstatements of the subsidiary companies are not required to be sent to the members of theCompany. The Company shall provide a copy of the annual accounts of its subsidiarycompanies to the members of the Company on their request. The annual accounts of itssubsidiary companies will also be kept open for inspection at the registered office of theCompany during business hours.

9. CONSOLIDATED FINANCIAL STATEMENTS

Your Directors have pleasure in attaching the Consolidated Financial Statementspursuant to the requirement of Section 129 of the Companies Act 2013 and Regulation 33& Regulation 34 of the SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015 read with other applicable provisions and prepared in accordance withthe Indian Accounting Standards (Ind AS) for financial year ended March 312020. TheConsolidated Financial Statements form part ofthis Annual Report.

10. DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

Pursuant to Article No. 98(1) of the Articles of Association of the Company none ofthe directors of the Company are liable to retire by rotation in accordance with theprovisions of Section 152 of the Companies Act 2013 as the Board of Directors of theCompany comprises of Managing Director and Independent Directors only.

The following have been designated as the Key Managerial Personnel of the Companypursuant to Sections 2(51) and 203 of the Companies Act 2013 read with the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014:

1. Mr. Vijay Kothari (DIN: 00172878) Managing Director

2. Mr. Siddhant Sharma Chief Financial Officer

3. Ms. Stuti Sinha Company Secretary and Compliance officer

DISQUALIFICATIONS OF DIRECTORS:

During the year declarations were received from the Directors of the Company pursuantto Section 164 of the Companies Act 2013. Board appraised the same and found that none ofthe director is disqualified for holding office as director.

11. DECLARATION BY INDEPENDENT DIRECTOR

The Independent Directors have submitted the declaration of independence as requiredunder Section 149(7) of the Companies Act 2013 stating that they meet the criteria ofindependence as provided in Section 149(6) of the Companies Act 2013 and Regulation16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015(‘the Listing Regulations').

12. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act 2013 the board of directors to thebest of their knowledge and ability confirm that:

i. in the preparation of the annual accounts the applicable Indian AccountingStandards (Ind-As) have been followed and there are no material departures in adoption ofthese standards;

ii. 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 ofthe profit of the Company for that period;

iii. The Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;

iv. The Directors have prepared the annual accounts on a going concern basis;

v. The Directors have laid down internal financial controls to be followed by theCompany and such internal financial controls are adequate and operating effectively;

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

13. FAMILIARIZATION OF INDEPENDENT DIRECTORS

The details of familiarization programme for Independent Directors have been disclosedat weblink of the Company:http://vijifinance.com/wp-content/uploads/2020/08/FamiliarisationProgrammes19-20.pdf

14. STATEMENT INDICATING THE MANNER IN WHICH FORMAL ANNUAL EVALUATION HAS BEEN MADE BYTHE BOARD OF ITS OWN PERFORMANCE ITS DIRECTORS AND THAT OF ITS COMMITTEES

The performance of the board was evaluated by the board after seeking inputs from allthe directors on the basis of the criteria such as the board composition and structureeffectiveness of board processes information and functioning etc. The performance of thecommittees was evaluated by the board after seeking inputs from the committee members onthe basis of the criteria such as the composition ofcommittees effectiveness ofcommitteemeetings etc.

The Board and the Nomination and Remuneration Committee reviewed the performance of theindividual directors on the basis of the criteria such as the contribution of theindividual director to the board and committee meetings like preparedness on the issues tobe discussed meaningful and constructive contribution and inputs in meetings etc. Inaddition the Chairperson was also evaluated on the key aspects ofhis role.

Performance Evaluation Criteria for Independent Directors:

The performance evaluation criteria for independent directors are determined by theNomination and Remuneration committee. An indicative list of factors that may be evaluatedinclude participation and contribution by a director commitment effective deployment ofknowledge and expertise effective management of relationship with stakeholders integrityand maintenance of confidentiality and independence of behavior and judgments.

15. PARTICULARS OF LOAN GUARANTEES AND INVESTMENTS U/S 186

Pursuant to Section 186 (11) of the Companies Act 2013 (‘the Act') theprovisions of Section 186(4) of the Act requiring disclosure in the financial statement ofthe full particulars of the loans made and guarantees given or securities provided by aNon-Banking Financial Company in the ordinary course of its business and the purpose forwhich the loan or guarantee or security is proposed to be utilized by the recipient of theloan or guarantee or security are exempted from disclosure in the Annual Report.

Further pursuant to the provisions of Section 186 (4) of the Act the details ofinvestments made by the Company are given in the Note No. 6 to notes of FinancialStatement.

16. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

In line with the requirements of the Companies Act 2013 and Listing Regulations yourCompany has formulated a Policy on Related Party Transactions which is also available onthe Company's website at web link: http://vijifinance.com/wp-content/uploads/2020/08/related-partv-policv-new.pdf. The Policy intends to ensurethat proper reporting; approval and disclosure processes are in place for all transactionsbetween the Company and Related Parties.

All Related Party Transactions are placed before the Audit Committee for review andapproval. Prior omnibus approval is obtained for Related Party Transactions on a quarterlybasis for transactions which are of repetitive nature and/or entered in the OrdinaryCourse of Business and are at Arm's Length. All Related Party Transactions are subjectedto independent review by an Audit Committee to establish compliance with the requirementsof Related Party Transactions under the Companies Act 2013 and Listing Regulations.

All Related Party Transactions entered during the year were in Ordinary Course of theBusiness and at Arm's Length basis. The Material Related Party Transactions i.e.transactions exceeding 10% of the annual consolidated turnover as per the last auditedfinancial statement which were entered during the year by your Company are givenseparately in notes to the financial statements. Further the disclosure of Related PartyTransactions as required under Section 134(3)(h) of the Companies Act 2013 in Form AOC-2 is set out as ANNEXURE-C and form part of this report.

17. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars in respect of conservation of energy technology absorption and foreignexchange earnings and outgo as required under sub-section (3)(m) of Section 134 of theCompanies Act 2013 read with Rule (8)(3) of the Companies (Accounts) Rules 2014 aregiven as under :

(A) Conservation of Energy:

(i) The steps taken or impact on conservation of energy:

The operations ofyour Company are not energy intensive. However adequate measures havebeen initiated to reduce energy consumption.

(ii) The steps taken by the company for utilizing alternate sources of energy : NotApplicable

(iii) The capital investment on energy conservation equipments: Not Applicable

(B) Technology Absorption:

(i) The efforts made towards technology absorption: Not Applicable.

(ii) The benefits derived like product improvement cost reduction product developmentor import substitution: Not Applicable.

(iii) In case of imported technology (imported during the last three years reckonedfrom the beginning of the Financial Year): Not Applicable.

(iv) The expenditure incurred on Research and Development: Company has not incurred anyexpenditure on Research and Development during the year under review.

(C) Foreign Exchange Earnings and Outgo:

Further there was neither inflow nor outflow of foreign exchange during the year.

18. STATEMENT IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROL WITH REFERENCE TOTHE FINANCIAL STATEMENTS

The Board of Directors of your Company is responsible for ensuring that InternalFinancial Controls (IFC) are laid down in the Company and that such controls are adequateand operate effectively. The Company's IFC framework is commensurate with its size scaleand complexity of operations. The framework has been designed to provide reasonableassurance with respect to recording and providing reliable financial and operationalinformation complying with applicable laws safeguarding assets from unauthorized useexecuting transactions with proper authorization and ensuring compliances with corporatepolicies.

The audit committee of the Board of Directors actively reviews the adequacy andeffectiveness of the internal control systems and suggests improvements to strengthen thesame. The company has a robust management information system which is an integral part ofthe control mechanism.

The audit committee of the board of directors statutory auditors and the businessheads are periodically apprised of the internal audit findings and corrective actionstaken. Audit plays a key role in providing assurance to the Board of director. Significantaudit observations and corrective actions taken by the management are presented to theaudit committee of the board. To maintain its objectivity and independence the internalaudit function reports to the chairman of the audit committee. Report of statutoryauditors for internal financial control system is part of Audit Report.

19. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Provisions of Section 135 of the Companies Act 2013 does not apply to the Company ascompany does not fall under any of the criteria specified under above referred sectiontherefore Company has not constituted Corporate Social responsibility (CSR) committee asrequired under the Act.

20. REMUNERATION POLICY / DISCLOSURE RELATING TO REMUNERATION OF DIRECTORS KEYMANAGERIAL PERSONNEL AND PARTICULARS OF EMPLOYEES:

In accordance with Section 178 and other applicable provisions if any of the CompaniesAct 2013 read with the Rules issued there under and the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Board of Directors formulated theNomination and Remuneration Policy of your Company on the recommendations of theNomination and Remuneration Committee. The Nomination and Remuneration Policy of thecompany is available on the website of the Company at http://vijifinance.com/wp-content/uploads/2016/12/Nomination-Remuneation-policy.pdf.

The Disclosure required under Section 197(12) of the Companies Act 2013 read with theRule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014as amended up to date is annexed as ANNEXURE-D and forms an integral part ofthisReport.

None of the employee of the company is drawing more than Rs. 10200000/- per annum orRs. 850000/- per month for the part of the year during the year under review thereforeParticulars of the employees as required under Section 197 of Companies Act 2013 readwith rule 5 (2) & rule 5 (3) of Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are not applicable during the year under review.

Furthernone of the Director has drawn any commission or remuneration from itssubsidiary companies i.e. Viji Housing Finance Limited and S.L. Developers Private Limitedas provided under section 197(14) of Companies Act 2013.

21. REPORT ON MANAGEMENT DISCUSSION ANALYSIS

As per Regulation 34(2) read with Schedule V of the SEBI (LODR) Regulations 2015 adetailed analysis of the Company's performance is discussed in the Management Discussionand Analysis Report which forms part ofthis Annual Report.

22. DISCLOSURE ON ESTABLISHMENT OF A VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company has a whistle blower policy for Directors and employees to report genuineconcerns or grievances about unethical behavior actual or suspected fraud or violation ofthe Company's code of conduct or ethics policy. The details of establishment of thereporting mechanism are disclosed on the website of the Company at the weblink:-http://vijifinance.com/wp-content/uploads/2018/07/Whistle-Blower.pdf. No Person has been denied access to theAudit Committee.

23. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALSIMPACTING THE GOING CONCERN STATUS OF THE COMPANY

There are no significant and material orders passed by the Regulators/Courts/Tribunalsthat would impact the going concern status of the Company and its future operations.

24. SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act 2013 and Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s. Ramesh Chandra Bagdi Practicing Company Secretaries Indore to conductthe Secretarial Audit of the Company for year ended March 31 2020. The Secretarial AuditReport given by the Secretarial Auditor of the Company is annexed as ANnEXURE-E and formsan integral part of this Report.

EXPLANATION TO SECRETARIAL AUDITOR'S REMARKS:

With respect to the observation of the Secretarial Auditor the Board replieshereunder:-

Secretarial Auditor Observations Management comments
Pursuant to Regulation 34 (1) (a) of SEBI (LODR) 2015 Annual Report with Notice of AGM was notsubmitted to stock exchange in prescribed time. However same has been submitted by the Company to the Exchanges before 21 days from the date of Annual General Meeting. Due to technical issue Annual Report could not be submitted to stock exchanges in prescribed time as per SEBI (LODR) 2015. However Annual Report has been submitted by the Company to the Exchanges before 21 days from the date of Annual General Meeting.
The Company has not paid Annual Listing fee to Calcutta Stock Exchange and also not submitted periodical documents through web Portal of Calcutta Stock Exchange. The Board is in process to get delist the shares from Calcutta Stock Exchange. Further periodical documents are submitted through designated Email of the Stock Exchange.

25. STATUTORYAUDITORS

M/s ShyamNagori& Company Chartered Accountants Indore (ICAI Firm Registration No.004573C) was appointed as Statutory Auditors ofyour Company in the 25* Annual GeneralMeeting held on 27th September 2019 for a term of five consecutive years upto the conclusion of 30*1 Annual General Meeting.

Pursuant to the Notification issued by the Ministry of Corporate Affairs on 7thMay 2018 amending Section 139 of the Companies Act 2013 the mandatory requirement forratification of appointment of Auditors by the Members at every AGM has been omitted andhence your Company has not proposed ratification of appointment of M/s Shyam Nagori &Company Chartered Accountants at the forthcoming AGM.

EXPLANATION TO AUDITOR'S REMARKS

The Auditors in their report have referred to the notes forming part of the Accountswhich are self-explanatory and does not contain any qualification reservation or adverseremark or disclaimer.

Further there was no fraud in the Company which was required to report by statutoryauditors of the Company under sub-section (12) of section 143of Companies Act 2013.

26. COST AUDITOR

The Company does not fall within the provisions of Section 148 of Companies Act 2013read with Companies (Cost Records & Audit) Rules 2014 as amended from time to timetherefore no such records are required to be maintained and company was not required toappoint cost Auditor for the Financial year 2019-20.

27. INTERNALAUDITORS

The Board has appointed Mr. Naveen Malav Chartered Accountant as Internal Auditor ofthe company and takes his suggestions and recommendations to improve and strengthen theinternal control systems. His scope of work includes review of operational efficiencyeffectiveness of systems & processes compliances and assessing the internal controlstrengths in all areas.

The Audit Committee reviews adequacy and effectiveness of the Company's internalcontrol environment and monitors the implementation of audit recommendations includingthose relating to strengthening of the Company's risk management policies and systems.

28. CODE OF CONDUCT

The Board of Directors has laid down a Code of Conduct ("the Code") for allBoard members and senior management personnel of your Company. The Code is posted onCompany's website at the web link: http://vijifinance.com/wp-content/uploads/2019/08/CODE-OF-CONDUCT-SM-AND-BOARD.pdf.

All Board members and senior management personnel have confirmed compliance with theCode.

29. CODE FOR PROHIBITION OF INSIDER TRADING PRACTICES:

On December 31 2018 Securities and Exchange Board of India amended the Securities andExchange Board of India (Prohibition of Insider Trading) Regulations 2015 prescribingvarious new requirements with effect from April 1 2019. In line with the amendments theCompany has adopted an amended Code of Conduct to regulate monitor and report trading byDesignated Persons and their Immediate Relatives & Connected Persons under theSecurities and Exchange Board of India (Prohibition of Insider Trading) Regulations 2015.

30. STATEMENT INDICATING DEVELOPMENT & IMPLEMENTATION OF RISK MANAGEMENT POLICY:

The Board of Directors has adopted risk management policy for the Company whichprovides for identification assessment and control of risks which in the opinion of theBoard may threaten the existence of the Company. The Management identifies and controlsrisks through a properly defined framework in terms of the aforesaid policy.

31. MATERIAL CHANGES& COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY

Due to lockdown announced by the Government from 25th March 2020operations of the Company were not much adversely affected. While office of the Companywere maintained operationally functioning by providing "Work from Home" facilityto its employees during the period of lockdown. Apart from this No material changes andcommitments affecting the financial position of the company have occurred between the endof the financial year to which the financial statements relate and at the date of thisBoard's report.

32. ENVIRONMENT AND SAFETY

The Company is conscious of the importance of environmentally clean and safeoperations. The Company's policy requires conduct of operations in such a manner so as toensure safety of all concerned compliances environmental regulations and preservation ofnatural resources.

33. SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION & REDRESSAL)ACT 2013

The Company has in place an Anti-Sexual Harassment Policy in line with the requirementsof The Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal)Act 2013. An Internal Complaints Committee (ICC) has been set up to redress the Complaintreceived regarding sexual harassment. There was no case of sexual harassment reportedduring the year under review.

34. LISTING OF SHARES

Company's shares are listed on National Stock Exchange of India Limited BSE Limitedand Calcutta Stock Exchange.

35. INSURANCE

The Company's assets are adequately insured against the loss of fire and other risk asconsider necessary by the Management from time to time.

36. BUSINESS RESPONSIBILITY REPORT

The Business Responsibility Reporting as required by Regulation 34(2) of the SEBI(Listing Obligations & Disclosure Requirements) Regulations 2015 is not applicableto your Company for the financial year ending March 312020.

37. DEPOSITORY SYSTEM

Your Company's shares are tradable compulsorily in electronic form and your Company hasconnectivity with both the Depositories

i.e. National Securities Depository Limited (NSDL) and Central Depository Service(India) Limited (CDSL). In view of the numerous advantage offered by the DepositorySystem members are requested to avail of the facility of Dematerialization of theCompany's shares on either of the Depositories mentioned as aforesaid.

38. INDUSTRIAL RELATIONS

Company's Industrial relations continued to be healthy cordial and harmonious duringthe period under review.

39. COMPLIANCE OF SECRETARIAL STANDARD

The Directors state that applicable Secretarial Standards i.e. SS-1 and SS-2 relatingto ‘Meetings of the Board of Directors' and ‘General Meetings' respectivelyhave been duly followed by the Company.

40. ACKNOWLEDGMENT

The Board of Directors wish to place on record its appreciation for the extendedco-operation and assistance rendered to the Company and acknowledge with gratitude thecontinued support and cooperation extended by the investors stakeholders Reserve Bank ofIndia Banks and other regulatory authorities.

Place: Indore

For and on behalf of the Board of Directors

Dated: 19 th August 2020 VIJI FINANCE LIMIi ED
Vijay Kothari Juhee Verma
Managing Director Director
DIN: 00172878 DIN: 07691682

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