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Unitech

BSE: 507878|NSE: UNITECH|ISIN: INE694A01020|SECTOR: Construction & Contracting - Civil
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Directors Report Year End : Mar '17    Mar 16

Dear Members,

The Company’s Directors are pleased to present the 46th Annual Report and the Audited Financial Statements of the Company for the year ended 31st March, 2017.

FINANCIAL RESULTS

The Financial Performance of the Company for the year ended 31st March, 2017 is summarized below:

(Figures in Rs. Crore)

2016-17

2015-16

Revenue from operations

1,155.09

1,332.01

and other Income

Less: Expenses

Construction & Real Estate

870.71

1,011.08

Project Expenditure

Cost of Land sold

65.45

279.54

Changes in inventories of

29.99

(117.67)

finished goods , work in

progress

Employee benefits

86.98

109.85

expense

Finance Cost

346.66

299.09

Depreciation and

3.94

4.49

amortization expense

Other Expenses

31.56

51.75

Total Expenses

1,435.29

1,638.13

Profit/ (Loss) before Tax

(280.20)

(306.12)

Less: Tax Expense

i) Current

-

61.46

ii) Deferred tax (net)

(89.31)

(89.31)

(94.22)

(32.76)

Profit/ (Loss) for the year

(190.89)

(273.36)

There were no material changes or commitments affecting the financial position of the Company which have occurred between the end of the financial year to which the Financial Statements relate and the date of report, other than the ones already provided or stated in the Financial Statements.

FINANCIAL HIGHLIGHTS AND STATE OF COMPANY AFFAIRS

The total income of the Company for the year under review is Rs.1,155.09 Crore. The Loss before tax stood at Rs.280.20 crore and Loss after tax stood at Rs.190.89 Crore. On consolidated basis, the total income of the Company and its subsidiaries stands at Rs.1795.26 Crore. The consolidated loss before tax stood at Rs.527.83 crore and loss after tax stood at Rs.402.67 Crore. The earnings per share (EPS) on an equity share having face value of Rs.2/-, stands at ‘ (0.73) considering the total equity capital of Rs.523.26 Crore.

On consolidated basis, the real estate and related division contributed Rs.1206.56 crore in the revenues of the Company,

whereas the contribution from the Property Management business was Rs.134.54 crore and from the Transmission Towers business was Rs.357.67 Crore. Hospitality contributed the revenue of Rs.36.73 Crore.

key highlights of the business and operations

During the year under review, there was no change in the nature of business of the Company. Some of the key highlights pertaining to the business of the Company, including its subsidiaries and associates, for the year under review and period subsequent thereto are given hereunder:

Project Sales and Delivery

In line with the trend in the last few years, given depressed market conditions, your Company focused on project delivery against launch and sale of new projects. During the year under review, your Company has launched totaling an area of 2.09 million sq.ft. The Company achieved sales bookings for a total area of 2.75 million sq.ft. during 2016-17 valued at Rs.851 crore. In terms of total area sold in 2016-17, 2.36 million sq.ft. was sold in Gurugram, 0.06 million sq.ft. in Noida & Greater Noida, 0.07 million sq.ft. in Chennai, 0.05 million sq.ft. in Kolkata and 0.21 million sq.ft. in other cities.

In terms of segment wise sales, 18.5 % of the area sold was from the residential segment while 81.5 % was from non-residential. The average realization, in 2016-17, from the non-residential segment was Rs.3,007 per sq.ft. as compared to the residential segment’s average realization of Rs.3,477 per sq ft.

Project Execution and Delivery

Your Company delivered 5.18 million sq ft of completed area during the year and 67 % of the projects are in handing over/finishing stage across various regions of the country. As at 31st March, 2017, a total of 33.16 million sq.ft. area is under development. In order to efficiently execute the much higher scale of projects across markets, the Company is substantially upgrading its operations. During the year under review, the Company continued to focus on strengthening the back end infrastructure of the construction division to improve the quality and output of construction work.

More details about the business and operations of the Company are provided in the Report on Management Discussion and Analysis forming part of this Report.

DIVIDEND

As your Company has incurred a net loss during the year under review, your Directors have not recommended any dividend for the year ended 31st March, 2017.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report, for the year under review, as stipulated under Regulation 34 & Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 [“Listing Regulations”] is given separately and forming part of this Report.

REPORT ON CORPORATE GOVERNANCE

The Report on Corporate Governance along with a Certificate from M/s. DR Associates, Company Secretaries (CP No. 714) confirming compliance with the conditions of Corporate Governance as stipulated under Schedule V of the Listing Regulations forms part of this report.

CONSOLIDATED FINANCIAL STATEMENTS

The Audited Consolidated Financial Statements of the Company, its subsidiaries, associates and joint ventures provided in the Annual Report are prepared in accordance with the provisions of the Companies Act, 2013 (“the Act”) read with Ind AS 110 - ‘Consolidated Financial Statements’ read with Ind AS 28 - ‘Investment in Associates’ and Ind AS 31 - ‘Interest in Joint Ventures’.

SUBSIDIARIES, JOINT VENTURES & ASSOCIATES

Pursuant to first proviso to Section 129(3) of the Act, a statement, containing salient features of financial statements of Company’s subsidiaries, joint ventures and associates (in Form AOC-1), is attached to the financial statements. The said statement describes the performance and financial position of each of Company’s subsidiaries, joint ventures and associates. The policy for determining material subsidiaries as approved may be accessed on the Company’s website at the link: http://www.unitechgroup.com/investor-relations/ corporate-governance.asp .

The audited financial statements and related information of the subsidiaries is available on website of the Company, viz. www. unitechgroup.com and will be made available, upon request by any member of the Company & shall also be made available for inspection at the registered office of the Company.

During the year under review, the status of Unitech Build-con Pvt. Ltd. has been changed from subsidiary to wholly owned subsidiary of the Company. Further, during the year under review, Pinnacle Holdings Ltd. ceased to be subsidiary of QnS Facility Management Pvt. Ltd., a wholly owned subsidiary of the Company.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT-9 as required under Section 92 (3) of the Act, read with rule 12(1) of the Companies (Management and Administration) Rules, 2014 is annexed herewith as Annexure-I to this report.

KEY MANAGERIAL PERSONNEL (KMP)

In compliance with the provisions of Section 203 of the Companies Act, 2013, the following Executive Directors and Officials of the Company are designated as the Key Managerial Personnel of the Company:

1.

Mr. Ramesh Chandra

Executive Chairman

2.

Mr. Sanjay Chandra

Managing Director

3.

Mr. Ajay Chandra

Managing Director

4.

Mr. Sunil Keswani

Chief Financial Officer [upto 29th April 2017]

5.

Mr. Deepak Kumar Tyagi

Chief Financial Officer [w.e.f. 29th April 2017]

6.

Mr. Deepak Jain

Company Secretary [upto conclusion of Board Meeting held on 4th November 2016]

7.

Mr. Rishi Dev

Company Secretary [w.e.f. conclusion of Board Meeting held on 4th November 2016]

DIRECTORS

In accordance with the provisions of Section 152 of the Act and rules made there under, Ms. Minoti Bahri, Non-Executive Director (DIN:00004530), retires by rotation at the ensuing Annual General Meeting and being eligible offers herself for re-appointment. The Directors recommend re-appointment of Ms. Minoti Bahri at the ensuing Annual General Meeting.

Since last Board Report, in 45th Annual General Meeting (AGM) of the Company, Maj. Gen. Virender Kumar Bhutani (Retd.) (DIN-03487268) has been appointed Independent Director on the Board for a period of five years w.e.f. 30th May, 2016, on non-rotational basis.

The details of programmes on familiarization of Independent Directors with the Company, their roles, rights and responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters are available on the Company’s website under web link http://www.unitechgroup.com/ investor-relations/corporate-governance.asp . During the year under review, two such programms were held which were attended by Independent Directors.

During the year under review, six meetings of the Board of Directors were held. The intervening gap between two consecutive meetings was not more than one hundred and twenty days as provided under Section 173 of the Act. The details of meetings are disclosed under Corporate Governance Report forming part of this Report.

BOARD EVALUATION

Pursuant to the provisions of Section 134, 149 & Schedule IV of the Act and Regulation 17(10) of the Listing Regulations annual performance evaluation of the Directors as well as of the various committees of the Board has been duly carried out.

The performance evaluation of the Independent Directors was carried out by the entire Board and the performance evaluation of the Chairman & Non Independent Directors was carried out by the Independent Directors at their properly convened meeting. The performance evaluation of the various Committees of Directors was carried out by the Board.

During the year, SEBI has issued a guidance note in order to guide listed entities by elaborating various aspects of Board evaluation. The guidance note covers all major aspects of Board Evaluation including the following:

a. Subject of Evaluation i.e. who is to be evaluated;

b. Process of Evaluation including laying down of objectives and criteria to be adopted for evaluation of different persons;

c. Feedback to the persons being evaluated;

d. Action Plan based on the results of the evaluation process;

e. Disclosure to stakeholders on various aspects;

f. Frequency of Board Evaluation;

g. Responsibility of Board Evaluation and

h. Review of the entire evaluation process periodically.

The purpose of the Guidance Note is to educate the listed entities and their Board of Directors about various aspects involved in the Board Evaluation process and improve their overall performance as well as corporate governance standards to benefit all stakeholders. The Nomination & Remuneration Committee had formulated/modified the existing Criteria of Evaluation in line with the aforesaid guidance note.

NOMINATION AND REMUNERATION POLICY

The Nomination and Remuneration Policy containing criteria for determining qualifications, positive attributes, independence of a director and policy relating to remuneration for the Directors, Key Managerial Personnel and Senior Management personnel of the Company are disclosed in the Corporate Governance Report forming part of this report.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 134(3)(c) of the Act the Directors confirm that:

- in the preparation of the annual accounts for the year ended 31st March, 2017, the applicable accounting standards had been followed along with proper explanation relating to material departures;

- the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2017 and of the loss of the Company for

the year ended on that date;

- the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

- the Directors had prepared the annual accounts on a going concern basis;

- the Directors, had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

- the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

internal financial control for financial STATEMENTS

Unitech has adequate system of internal controls commensurating with the size of its operation and business, to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposition, and to ensure that all the business transactions are authorized, recorded and reported correctly and adequately.

The Company works in a dynamic business environment and adopts the appropriate internal financial controls, to establish reliability of financial reporting and the preparation of financial statements for external purposes, in accordance with the generally accepted accounting principles. It includes inducting and maintaining such business policies and procedures as may be required to successfully conduct the business of the company and maintain such records as to correctly record the business transaction, assets and liabilities of the company in such a way that they help in prevention & detection of frauds & errors and timely completion of the financial statements.

The construction industry is passing through a challenging phase and the Company is no exception. The top management of the Company, to utilize the available resources efficiently has decided to engage itself more with the operations of the Company. The Company is further enhancing/ strengthening the internal financial reporting with respect to significant business control, risk management processes etc.

The Company’s internal controls are further supplemented by internal audits, management review and documented policies, procedures & guidelines. The internal control system is designed to ensure that financial records are reliable for preparing financial information and recording of assets.

All financial and audit control systems are also reviewed by the Audit Committee and Board of Directors of the company.

AUDIT COMMITTEE

The composition of the Audit Committee is provided in the Corporate Governance Report forming part of this report.

AUDITORS AND AUDITORS’ REPORT

Statutory Auditors

M/s R. Nagpal Associates, Chartered Accountants (Firm Registration No. 002626N) were appointed, in the Annual General Meeting held on 12th September 2016, for a term of consecutive five years from the conclusion of 45th Annual General Meeting till the Conclusion of 50th Annual General Meeting (subject to ratification by the members at every subsequent Annual General Meeting).

Accordingly the Audit Committee and the Board of Directors have recommended for ratification of appointment of M/s R. Nagpal Associates, Chartered Accountants (Firm Registration No. 002626N) for the FY 2017-18, by the members at the ensuing Annual General Meeting.

Auditors’ Report

A) The Auditors’ in their Report to the members, have given five qualified opinions and the response of your Directors with respect to it are as follows:-

Response to point (1)

On basis of internal assessments and evaluations, possible recoveries from securities (registered or unregistered) have represented that the significant portion of such trade receivables balance outstanding are still recoverable/ adjustable and that no accrual for diminution in value of trade receivables, other than the ones already provided in the books of accounts; is therefore necessary for the period ending 31st March, 2017. The Management closely monitors its credit exposure and is confident of appropriately adjusting / recovering significant portions of the remaining outstanding balance of such amounts in the foreseeable future.

Response to point (2)

The Company is making best possible efforts for sale of the land parcels earmarked for repayment of the deposits but such sale process is taking time due to global economic recession and liquidity crisis, particularly, in the real estate sector of India. However, regardless of these adverse circumstances and difficulties, the Company is committed to comply with the orders passed by the Hon’ble NCLT (including the ones passed by CLB) and NCLAT to repay all the public deposits along with interest thereon in the course of time period.

The company has already earmarked 6 (six) unencumbered land parcels which shall be sold and the entire sale proceeds thereof shall be utilized for repayment of the said deposits. The Company is fully committed to repay all the deposits along with interest thereon and it is making all efforts to arrange the necessary resources required for this purpose.

Response to point (3)

The Company periodically assesses and evaluate its investments, loans and advances. The Company is of the firm view that the diminution, if any, even if it exists is only temporary and that sufficient efforts are being undertaken to revive the said subsidiaries in the foreseeable future so as to recover carrying value of the investment. Further, management believes that the loans and advances given to these companies are considered good and recoverable based on the future projects in these subsidiaries and accordingly no provision other than those already accounted for, has been considered necessary.

Response to point (4)

Advances for the purchase of land, projects pending commencement and to joint ventures and collaborators have been given in the normal course of business to land owning companies, collaborators, projects and for purchase of land. Periodically the management assesses the recoverability of such advances The management of the Company, based on the internal assessment and evaluations, considers that these advances, which are in the normal course of business are recoverable/adjustable and that no provision is necessary at this stage. The management is confident of recovering/ appropriately adjusting the balance in due course.

Response to point (5)

The Company has written a letter to GNIDA dated 1 December 2015, wherein it has stated that the cancellation of the lease deed is wrong, unjust and arbitrary. The Company has also described steps taken for implementation of the project, valid business reasons due to delays till date. Further, it had also proposed that in view of the fact that third party interests have been created by the Company in the allotted land, by allotting plots to different allottees, in the interest of such allottees, GNIDA may allow the Company to retain an area of approximately 25 acres out of the total allotted land of approx. 100 acres and that the amount paid by the Company till date may be adjusted against the price of the land of 25 acres and remaining surplus amount may be adjusted towards dues of other projects of the Company under GNIDA. The discussions/ negotiations and the legal recourse process are currently underway. The management is of the concerned view that in view of the recent developments, in-spite of the aforesaid letter, no provisioning of the investment made in the project is required

B) The Auditors’ in their report to the members, have stated two “Emphasis of matter” and the response of your Directors on them are as follows:-

Response to point (1)

The Company filed a writ petition before Hon’ble High Court of Punjab & Haryana challenging the termination of development agreement. The matter was referred for arbitration and the matter is pending adjudication before the panel of three arbitrators. The Company has concluded its evidence. The Company has a good case and accordingly no provision has been considered necessary.

Response to point (2)

Based on the legal advice received by it, the Company believes that the said award of LCIA and order of the Hon’ble Delhi High Court is not enforceable in India on various grounds including but not limited to lack of jurisdiction by the LCIA appointed arbitral tribunal. The Hon’ble High Court of Delhi has passed an order in the case instant. On the basis of legal advice received, the Company is sanguine & strongly believes that its stand taken in this matter will be vindicated in the Hon’ble Supreme Court. The Company is preparing for filing the SLP in the Hon’ble Supreme Court against the said Order of the Hon’ble High Court of Delhi. Nevertheless, in case if the Company is required to make the aforesaid investment into Kerrush Investments Ltd. (Mauritius), its economic interest in the SRA project in Santacruz Mumbai shall stand increased proportionately thereby creating a substantial asset for the Company with an immense development potential.

C) Further, the Board gives the following explanations, to the comments of the Auditors’ in para 1 (g) to Report on Other Legal and Regulatory Requirements:-

The Company has sought legal opinions from its legal advisors, with respect to the matured unpaid debentures and public deposits outstanding at Balance Sheet date. Based on the same, the Board is of the view that the provisions of Section 164(2) (b) of the Companies Act, 2013 does not attract.

D) Further, the Board also gives the following explanations, to the Disclaimer of Opinion of the Auditors’ in the Annexure A to Auditors’ Report to the members:-

1. The Company works in a dynamic business environment and adopts the suitable internal financial controls, especially the ones having bearing upon reliability of financial reporting and the preparation of financial statements for external purposes, in accordance with the generally accepted accounting principles. It includes maintaining such business policies and procedures as may be required to effectively conduct the business of the Company and maintain such records as to properly record the business transaction, assets and liabilities of the Company in such a way that they help in prevention of frauds & errors and timely completion of financial statements.

a. Following the norms prevailing in the real estate industry the Company does not ascertain the credit worthiness of customers. The Company maintains the due and mandated KYC norms of the customers. The Company takes a good amount of the overall purchase price of the customer as an advance at the time of booking, and should in case, if the customer fails to pay the due amount, the Company can forfeit the amount, already paid by the customer. The risk is further reduced where the property purchased by customer if financed by any bank/ NBFC. The said Bank/ NBFC do their routine credit check of the customer and thus the Company is not exposed to any credit risk for not ascertaining the credit worthiness of customers.

b. The advances for the purchase of land, projects pending commencement and to the joint ventures and collaborators are given in the normal course of business to land owning Companies, collaborators, projects and for the purchase of land. The Company keeps a watch on how this amount is utilized ultimately. The management of the Company based on the internal assessment and evaluation considers that these advances, which are in the normal course of business, are recoverable/ adjustable. The Company has a process to advance such loans & advance and the management of the Company keeps a close watch on extending such loans & advance and their ultimate recovery.

c. The Company, as per the generally accepted accounting principles, duly provides for the diminished value of such loans & advances, where the recovery of such loan is doubtful. The management believes that the diminution in the value of investments, to the extent other than the value already reduced in the books of accounts, if any, that exists; is only temporary and that the sufficient efforts are being undertaken to revive the said subsidiaries in the foreseeable future so as to recover carrying value of the investment.

2. Project management and land management are the keys to the successful and timely completion of projects. The Company has focused attention to complete the existing projects and has aligns all its available resources for the execution of the projects. This dynamic approach requires realignment of the prevailing internal control relating to Project Management, Project Revenue and Land Management. Similarly to utilize its existing resources better, the company is re-aligns its processes relating to Land Management, Receivable Management, Litigations & Claims.

E) Further, the Board also gives the following explanations, to comments of the Auditors’ in the Annexure B to Auditors’ Report to the members:-

Response to point (iii)(a)

The matter has been evaluated and the Company is of the firm view that the diminution, if any, even if it exists is only temporary and that sufficient efforts are being undertaken to revive the said subsidiaries in the foreseeable future so as to recover carrying value of the investment. Further, management believes that the loans and advances given to these Companies are considered good and recoverable based on the future projects in these subsidiaries and accordingly no provision other than those already accounted for, has been considered necessary.

Response to point (v)

The Company is making best possible efforts for sale of the land parcels earmarked for repayment of the deposits but such sale process is taking time due to global economic recession and liquidity crisis, particularly, in the real estate sector of India. However, regardless of these adverse circumstances and difficulties, the Company is committed to comply with the orders passed by the Hon’ble NCLT (including the ones passed by CLB) and NCLAT to repay all the public deposits along with interest thereon in the course of time period.

The Company has already earmarked 6 (six) unencumbered land parcels to be sold and the entire sale proceeds thereof shall be utilized for repayment of the said deposits. The Company is fully committed to repay all the deposits along with interest thereon and it is making all efforts to arrange the necessary resources required for this purpose.

Response to point (vii)(a)

The Management is of the view that there are delays in the payment of income tax, service tax & provident fund. however, with improved business environment and particularly in the challenging Real Estates Industry the Company will be able to meet its obligations in time. The Management is hopeful and committed to their level best to streamline the same in future.

Response to point (viii)

The real estate sector, as a whole, is passing through tough time and your Company is also facing this heat. In this challenging phase, cash-flows of the Company have been adversely impacted and there were certain delays/defaults in timely repayment of dues (including interest) to Banks and financial institutions in respect of term loans and non convertible debentures. It is submitted that the Company endeavors to streamline its future operations and discharge the said liabilities in time.

Cost Auditors

The Board of Directors, on recommendation of the Audit Committee, has appointed M/s. M.K. Kulshrestha & Associates, Cost Accountants (Firm Registration No. 100209) as cost Auditors for the financial year 2017-18 to carry out the audit of cost records maintained by the Company. In terms of Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditors for the financial year 2017-18 is subject to ratification by the shareholders of the Company.

Secretarial Auditors

Pursuant to provisions of Section 204 of the Act read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. DR Associates, Company Secretaries (CP No. 714), to conduct the Secretarial Audit of the Company for the financial year 2017-18.

The Secretarial Audit Report (Form MR-3) is annexed as Annexure II forming part of this Report.

The responses of your Directors on the observations made by the Secretarial Auditor are as follows:-

Response to point No.1

The Company has sought legal opinions from its legal advisors, with respect to the matured unpaid debentures and public deposits outstanding at Balance Sheet date. Based on the same, the Board is of the view that the provisions of Section 164(2) (b) of the Companies Act, 2013 does not attract.

Response to point No.2

The real estate sector is facing the heat of liquidity crunch and the Company is also going through this challenging time. The cash flows of the Company have been adversely impacted and there are delays in delivering projects and repayments of depositors and creditors. The same resulted in rise in litigations. The Company is trying hard to make timely repayments and deliveries and hopeful to get out of it soon.

Response to point No.3

There are delays in the payment of income tax, service tax & provident fund. however, with improved business environment and particularly in the challenging Real Estates Industry the Company will be able to meet its obligations in time. The Management is hopeful and committed to their level best to streamline the same in future.

Response to point No.4

The Company is law abiding entity, and is endeavor to file all required forms and returns with the Registrar in time. However, there has been few delays which the management ensures to take care in future.

RISK MANAGEMENT

In the Company, a well defined risk management mechanism is in place. The Objective of the mechanism is to identify the various inherent risks in the process and advance actions to be taken to mitigate it. A detailed exercise is carried out to identify, evaluate, monitor and manage both business and non-business risks.

The Company has a Risk Management Policy to identify and assess the key risk areas, mitigating risk, monitor and report effectiveness of the process and control.

VIGIL MECHANISM

Pursuant to Section 177(9) of the Act read with relevant Rules and Regulation 22 of the Listing Regulations, the

Company has a Vigil Mechanism/Whistle Blower Policy for Directors and employees to report genuine concerns. The said Policy has been posted on Company’s website (www. unitechgroup.com).

During the year under review, no concerns or grievances pursuant to the same were reported.

CORPORATE SOCIAL RESPONSIBILITY [CSR]

Pursuant to Section 135 of the Act read with Companies (Corporate Social Responsibility Policy) Rules, 2014, the Board has constituted a CSR Committee and based on the recommendations of the Committee the CSR Policy has been approved by the Board of Directors of the Company. The same is available on the website of the Company (www. unitechgroup.com).

During the year under review, CSR Committee recommended that since there is average loss in three preceding financial years, there is no statutory requirement for spending on CSR activities pursuant to provisions of Section 135 of Companies Act, 2013 read with Companies (Corporate Social Responsibility Policy) Rules, 2014. However, the Company and its management is committed to contribute towards the betterment of the society where we live and work as and when the company’s cash flow permits.

The annual report on CSR activities is attached at Annexure-III forming part of this report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Particulars of Loans given, Guarantees given or Investments made under Section 186 of the Act are given in notes to standalone financial statements.

DEPOSITS

During the year under review, the Company has not accepted any deposits under the provisions of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits), Rules 2014.

Particulars of Deposits covered Under Chapter V of the Act are as follows:

Particulars

Details

Amount of Deposits accepted during the year

Amount of Deposits remained unpaid or unclaimed during the year*

Whether there has been any default in repayment of deposits or interest thereon; and if so the number of times and the total amount involved-

- At the beginning of the year

- Maximum during the year

- At the end of the year

Details of deposits which are not in Compliance with Chapter V of this Act.

NIL

Rs.547.66 Crore

In March 2015, the Company had filed an application before the Hon’ble CLB [Now NCLT] for seeking, inter-alia re-schedulement of repayment of Fixed Deposit. During the year under review, the Hon’ble National Company Law Tribunal, New Delhi (NCLT) dismissed the said application. On appeal against the said order, the Hon’ble National Company Law Appellate Tribunal, New Delhi (NCLAT) extended the date of repayment of deposits under Section 74(1) of the Act upto 31st December 2016. Subsequently, the said appeal was also dismissed by the Hon’ble NCLAT vide its order dated 31stJanuary 2017.

The Company has already earmarked six unencumbered land parcels and best possible efforts are being made for sale of said land parcels for repayment of the deposits.

However, regardless of adverse circumstances and difficulties, the management is committed to comply with the orders passed by Hon’ble NCLT and Hon’ble NCLAT to repay all the public deposits alongwith interest thereon.

*As at 31st March,2017

RELATED PARTY TRANSACTIONS

All related party transactions attracting compliance under Section 188 of the Act and Regulation 23 of the Listing Regulations are placed before the Audit Committee and the Board. Prior omnibus approval of the Audit Committee was also obtained for the transactions which were of a foreseen and repetitive nature.

All contracts/ arrangements/ transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on arm’s length basis. During the year under review, the Company has not entered into any contract/arrangement/transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions. In view of the same, the requirement of giving particulars in Form AOC-2 is not applicable for the year under review.

The Company has framed, approved and implemented a policy on dealing with Related Party Transactions and the same is available on Company’s website under web link http://www.unitechgroup.com/investor-relations/corporate-governance.asp.

Your Directors draw attention of the members to Note No. 44 to the standalone financial statement which sets out related party disclosures.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

The ratio of remuneration of each Director to the median employees’ remuneration and other details in terms of Section 197(12) of the Act read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as Annexure IV forming part of this report.

The statement containing particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 will be provided upon request by any member of the Company. However, in pursuance of Section 136 of the Act, this report is being sent to all shareholders of the Company, excluding the aforesaid information and the said particulars are made available for inspection at the Registered Office of the Company during working hours and any member interested in obtaining such information may write to the Company.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION

Since the Company does not own any manufacturing facility, the requirements pertaining to disclosure of particulars relating to conservation of energy and technology absorption are not applicable.

FOREIGN EXCHANGE EARNINGS AND OUTGO

The Company is engaged in developing/constructing residential and commercial properties in India and selling the immovable properties to customers in India and abroad. The Company receives remittances of sale consideration for immovable properties located in India, purchased by the customers abroad.

The foreign exchange earnings and outgo of the Company during the year under review were NIL and Rs.3.77 crore as compared to NIL and Rs.2.73 crore in the previous year respectively.

SIGNIFICANT AND MATERIAL ORDERS

During the year under review, there were no significant and material orders passed by the regulators or courts or tribunals that would impact the going concern status and Company’s operation in future.

PREVENTION OF SEXUAL HARASSMENT AT workplace

The Company had formulated and adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed thereunder. Further during the year under review, no case/complaints pursuant to the same were reported to the Board.

ACKNOWLEDGEMENTS

Your Directors wish to express their sincere appreciation for the co-operation received from the financial institutions, banks, government authorities, customers, vendors and suppliers during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the significant contribution made by each & every employee of the Company. The Directors are also thankful to all stakeholders for their continued patronage.

BY THE ORDER OF BOARD OF DIRECTORS

for UNITECH LIMITED

Ramesh Chandra

Chairman

DIN: 00004216

Date: 30th May, 2017

Place: Gurugram

Source : Dion Global Solutions Limited
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