DIRECTORS' REPORT Dear Members, 1. Your Directors have pleasure in presenting their 35th Annual Report and Audited Accounts for the year ended 31st March 2015 2. OPERATIONS: Currently the Company is not carrying its activities. The management of the Company evaluating opportunities available in current market scenario to revive its activities. 3. DIVIDEND: During the year under review, the Company has not recommended any dividend for financial year 2014-15. 4. PUBLC DEPOSITS: During the year under review, the Company has not accepted any deposits hence the provisions of Chapter V of the Companies Act, 2013 and The Companies (Acceptance of Deposit) Rules, 2014 are not applicable. 5. SHARE CAPITAL: During the year under review, there is no change in Authorised and Paid-up share capital of the Company except conversion of 1825 partly paid-up equity shares of Rs. 10/- each into fully paid-up equity shares vide board resolution dated 28th October 2014. 6. PROMOTER OF THE COMPANY: During the year under review, there is no change in promoters of the Company. 7. DIRECTORS: During the period under review, Mrs. Sridevi Nadella was appointed as additional Director of the Company with effect from 15th December, 2014 by the Board of Director of the Company under section 161(1) of the Companies Act, 2013 to act as Independent Director of the Company in terms of section 149 of the Companies Act, 2013. Further there were no changes in composition of Board of Directors of the Company. The Board consists of Executive and Non-executive Directors including Independent Director as per section 149 of the Companies Act, 2013 and rules made thereunder read with Clause 49 of the Listing Agreement. The Board proposed the appointment of Mr. Sanjiv Kumar Tandon, who retires on rotation, as a Director of the Company and Mr. Sachendra Tummala as Managing Directors of the Company in terms of section 197, 198 and 203 of the Companies Act, 2013 and rules made thereunder. The number and details of the meetings of the Board and other Committees are furnished in the Corporate Governance Report. The Independent Directors have furnished declaration of independence under Section 149 of the Companies Act 2013. Familiarization Programme for Independent Directors The Company familiarizes its Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company, etc. through various programmes on a continuing basis. The Familiarisation programme for Independent Directors is disclosed on the Company's website. Separate Meeting of Independent Directors A separate meeting of Independent Directors of the Company was held on 31st March,2015 as required under Schedule IV to the Companies Act, 2013 (Code for Independent Directors) and Clause 49 of the Listing Agreement. At the Meeting, the Independent Directors: - Reviewed the performance of Non-Independent Directors and the Board as a whole; - Reviewed the performance of the Chairman of the Company, taking into account the views of Executive Director and Non-Executive Directors; All the Independent Directors attended the Meeting of Independent Directors and Mr. Ravi Kumar Chennupati was the Lead Independent Director of that Meeting. Board & Directors' Evaluation Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board, its Committees and the Directors have carried out annual evaluation / annual performance evaluation, covering various aspects of the Board's functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance. The Directors expressed their satisfaction with the evaluation process. Directors' Appointment and Remuneration Policy The Nomination and Remuneration Committee is responsible for developing competency requirements for the Board based on the industry and strategy of the Company and formulates the criteria for determining qualifications, positive attributes and independence of Directors in terms of provisions of Section 178 (3) of the Act and Clause 49 of the Listing Agreement. The Board has, on the recommendations of the Nomination& Remuneration Committee framed a policy for remuneration of the Directors and Key Managerial Personnel. 9. PARTICULARS OF EMPLOYEES AND REMUNERATION The information required under Section 197 (12) of the Act read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is NIL 10. AUDITOR'S AND AUDITOR'S REPORT: M/s. Ganesh Venkat & Co., Chartered Accountants (Registration No. 005293S; M.No. 025104), Hyderabad, Statutory Auditors of the Company, who was appointed as Statutory Auditors of the Company by shareholders of the Company vide resolution dated 29.09.2014 until the conclusion of Annual General Meeting for the financial year ended 31st March, 2017 subject to ratification by the members at every Annual General Meeting. The Company has received written consent along with a certificate under 141 of the Companies Act, 2013 expressing their eligibility to be appointed as Statutory Auditors of the Company and in view of the same the Board has proposed a resolution for ratification of Auditors appointment for the financial year 2015-16. Further, comments in their report and notes forming part of financial statements are self explanatory and do not require any comments. Secretarial Audit Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointmenand Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. Ajay Shrivastava, Company Secretary in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report is annexed herewith as ‘Annexure III’. There was no qualification, reservation or adverse remark in the secretarial audit report. 11. SUBSIDIARY COMPANIES: The Company does not have any subsidiary/ associate/ Joint venture companies under review. Since the statement in terms of first proviso to sub-section (3) of Section 129 read with Rule 5 of Companies (Accounts) Rules, 2014 is not required to be attached. 12. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS: As on 31st March, 2015, the company has unsecured loan of Rs. 40.81 Lacs. 13. INTERNAL CONTROL SYSTEMS Your Company has in place internal and financial control systems commensurate with the size of the Company. The primary objective of our internal control framework is to ensure that internal controls are established, properly documented, maintained and adhered to in each functional department for ensuring orderly and efficient conduct of business which includes proper use and protection of the Company's resources, accuracy in financial reporting, compliance with the statutes, timely feedback on achievement of operational and strategic goals. 14. RESEARCH & DEVELOPMENT: During the year under review, No R & D activity was undertaken by the Company. 15. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is annexed herewith as 'Annexure ' VI. 16. INFORMATION ON STOCK EXCHANGES The Equity shares of the Company are listed on BSE Limited and the Listing Fee has been paid for FY 2015-16. 17. CORPORATE GOVERNANCE A detailed report on the subject forms part of this report. The Statutory Auditors of the Company have examined the Company's compliance and have certified the same as required under the SEBI Guidelines. Such certificate is reproduced in this Annual Report. 18. DIRECTORS' RESPONSIBILITY STATEMENT To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134 of the Companies Act, 2013: (a) that in the preparation of the annual accounts/financial statements for the financial year ended 31st March 2015, the applicable accounting standards had been followed along with proper explanation relating to material departures, if any; (b) that the accounting policies as mentioned in the financial statements were selected and applied consistently and reasonable and prudent judgments and estimates were made so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period; (c) that proper and sufficient care had been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities; (d) that the annual accounts were prepared on a going concern basis; (e) that proper internal financial controls were in place and that such internal financial controls are adequate and were operating effectively; and (f) that proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively. 19. CORPORATE SOCIAL RESPONSIBILITY (CSR) As the Company does not fall under the criteria stipulated for applicability of section 135 of the Companies Act, 2015 the Company has not constituted a Committee of Corporate Social Responsibility and no contributions were made during the year. 20. VIGIL MECHANISM / WHISTLE BLOWER POLICY In terms of the requirements of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Company has a vigil mechanism to deal with instance of fraud and mismanagement, if any. The details of the vigil mechanism are displayed on the website of the Company. The Audit Committee reviews the functioning of the vigil / whistle blower mechanism from time to time. There were no allegations / disclosures / concerns received during the year under review in terms of the vigil mechanism established by the Company "Annexure IV" 21. RELATED PARTY TRANSACTIONS During the year under review, the Company has entered into any related party transactions. • The Company has paid a rent of Rs. 0.24 Lacs to an Associate Company • During the year the Company has borrowed an Unsecured Loan of Rs. 9.03 Lacs from its KMP 22. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS: During the year under review, the Company has received an AAjudiccting Order No. ISD/MSRGL/AO/DRK-AKS/EAD3-723/48-2015 dated 30.03.2015 under Section 151 of SEBI Act, 1992 read with 5(1) of SEBI imposing penalty of Rs. 7,00,000/- (Rupees Seven Lakh Only) for violation of disclosure requirement for the financial years 1998 to 2002, 2004 and 2007 i.e. the period prior to the takeover by present Management, under of SEBI , 1999 and same has been deposited to SEBI. No other orders were received during the year. 23. EXTRACT OF ANNUAL RETURN The details forming part of the extract of the Annual Return in form MGT-9 is annexed herewith as 'Annexure' VI. ACKNOWLEDGEMENTS Your Directors would like to express their appreciation for the assistance and co-operation received from the financial institutions, banks, Government of India and various State Government authorities and agencies, customers, vendors and members during the year under review. For and on behalf of the Board of Directors Sd/- Sachendra Tummala Managing Director Date: 13.08.2015 Place: Hyderabad |