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VLS Finance Ltd.

BSE: 511333 | NSE: VLSFINANCE | Series: NA | ISIN: INE709A01018 | SECTOR: Finance - Leasing & Hire Purchase

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Annual Report

For Year :
2018 2016 2015 2014 2013 2012 2011 2010 2009

Director’s Report


The Directors are pleased to present the 31st Annual Report of the Company together with the Audited Annual Accounts for the year ended 31st March, 2018.

1. Financial Results (Rs. in Lakhs)

For the year ended 31st March, 2018

For the year ended 31st March, 2017*

Gross Receipts



Profit before Interest, Finance Charges & Depreciation



Less: Interest & Finance Charges



Profit before Depreciation



Less: Depreciation



Profit before exceptional & extraordinary items & tax



Less: Provision for diminution of value of assets (net)



Profit before Tax



Less: Provision for Taxation/(Credits)



Profit after Tax



Surplus brought forward from previous year



Less: i) Proposed dividend on Equity Shares



ii) Dividend distribution tax



Available for Appropriation




To General Reserve



Surplus c/f



* (Figures have been regrouped / recast to conform to current year’s figures)

2. Management Discussion and Analysis Financial Review

During the year under review, profit before tax was Rs.1838.54 lakhs as compared to Rs. 5071.08 lakhs for the previous year. The profit after tax stood at Rs. 1484.83 lakhs as compared to Rs. 3749.59 lakhs during the previous year.

Industry Structure and Development

The global economy growth according to Goldman Sachs economic survey estimation is now at 4 percent and growth of developing Asian economies is estimated to be 6 percent, by Asian Development Bank (ADB) report. The financial markets have been showing a confident run as compared to last financial year. ADB report pegs Indian economy to grow at 7.3 percent for the current financial year. However, increasing divergence in monetary policies and volatility of capital flows coupled with foreign economic decisions viz. Brexit, United States trade agreement re-negotiations etc. paints an uncertain time ahead for our economy.

The growth prospects of the Emerging Asian economies (Southeast Asia, China and India) are expected to remain robust over the medium term amid global economic uncertainty. The Asian region is expected to grow at 6 percent in 2018-2019.

Outlook, Risks and Concerns

The country''s equity markets remains promising for both global and domestic investors. The underlying strength of Indian consumption and demand, continues to remain healthy. The performance of your Company is closely linked to those of the stock markets. The growth tendencies for 2018-2019 are expected to be mostly reflective of the developments in these areas. Your Company has been making use of available opportunities in the capital markets for its operations, keeping in view its business objectives.

Our approach to risk management is based on our extensive experience and well placed risk management framework. The Company is exposed to normal industry risks such as credit, interest rate, economic, currency, political, market and operational risks. The Company views risk management as integral to its business for creating and maintaining best practices in business operations and administration. Opportunities and Threats

The continuing emphasis on ‘Make in India’ by government is expected to infuse further capital investment in the country and thus more opportunity for financial sector. The relaxation of foreign investment rules has received a positive response from the financial sector. The Company is looking forward to grasp the available opportunities. The Company will also focus on permitted avenues as a member of the Stock Exchange. The uncertain state of the global economy however remains a cause of concern.

Adequacy of Internal Financial Control Systems

The management in consultation with Internal Auditors monitor and evaluate the efficacy and adequacy of internal financial control systems in the Company, its compliance with operating systems, accounting procedures and policies at all levels of the Company and its subsidiaries. The audit observations and the corrective actions thereon are presented to the Audit Committee of the Board. The control framework is established and maintained by the Company. The observations by the internal and statutory auditors are perused by the Management, the Audit committee as well as the Board for proper implementation. The Company’s internal financial controls have been found to be adequate and effective. Segment wise Performance

Accounting Standard (AS-17) relating to “Segment Reporting” has been complied with. The gross operating income and profit from the other segment is below the norms prescribed in AS-17, hence separate disclosure has not been made.

Cautionary Statement

The statements in the above analysis, describing the Company’s estimates, expectations or predictions may be ‘forward looking statements’ within the meaning of applicable securities laws and regulations. The actual results may differ from those expressed or implied. Important factors that could make a difference to the Company’s operations include changes in government regulations, tax regimes, economic developments within the country and abroad, and other related factors.

3. Dividend & Reserve

The Board has recommended 10% dividend on equity shares i.e. Rs.1/- per equity share for the year 2017-18 subject to approval of members. The dividend, if approved, will be paid to the registered members as on the date of book closure for the purpose of Annual General Meeting scheduled to be held on 20/09/2018. No amount was proposed to be transferred to the reserve during the year under review.

4. Directors/ Key Managerial Personnel (KMP)

The following changes have occurred from 01/04/2017 till the date of this report in the composition of the Board of Directors/ Key Managerial Personnel of your Company:


In accordance with the provisions of Article 89 of the Articles of Association of the Company, Shri K. K. Soni- Director Finance & CFO and Shri Vikas Mehrotra -Director will retire by rotation at the ensuing Annual General Meeting of your Company (‘AGM’) and being eligible, offer themselves for re-election. The Board recommends their appointment.

In order to comply with recent amendment in SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, the Board also recommends for approval of Members by way of special resolution, the continuation of Non -Executive Directors, namely Shri Ajit Kumar (DIN:00106597) and Dr. S. Ramesh (DIN:00126120) - Independent Directors who have attained the age of 75 years, till their respective tenure of appointment, after 31/03/2019. Further details have been provided in the Notice for convening 31st Annual General Meeting of the Company.

Key Managerial Personnel (KMP):

Pursuant to the provisions of sub-section (51) of Section 2 and Section 203 of the Act read with the Rules framed thereunder, the following persons were Key Managerial Personnel of the Company as on March 31,2018:

1. Shri S. K. Agarwal, Managing Director

2. Shri K. K. Soni, Director Finance & Chief Financial Officer

3. Shri H. Consul, Company Secretary

There was no change in the key managerial personnel of your Company during the year under review.

5. Independent Directors

In terms of the provisions of sub-section (6) of Section 149 of the Act and Regulation 16 of the Listing Regulations, the Company has received declarations from all the Independent Directors of the Company that they meet with the criteria of independence as provided in the Act and the Listing Regulations. Further, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, and reimbursement of expenses, if any, incurred by them for the purpose of attending meetings of the Company.

6. Annual Return extract (MGT-9)

The details forming part of the extract of the Annual Return for the year 2017-18 in Form MGT-9 is enclosed as Annexure A.

7. Contracts with Related Party

The disclosure in prescribed form AOC-2 is enclosed as Annexure B.

8. Directors’ Responsibility Statement

Pursuant to the provisions of Section 134(3) of the Companies Act, 2013, the Directors hereby confirm:

a. that in the preparation of the annual accounts for the financial year ended 31st March, 2018, the applicable accounting standards have been followed, along with proper explanation relating to material departures;

b. that they have 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 at the end of the financial year and of the profit of the Company for that period;

c. that they have taken proper and sufficient care 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 they have prepared the Annual Accounts for the financial year ended 31st March, 2018 on a ‘going concern’ basis;

e. that they have laid down Internal Financial controls to be followed by the Company and that such Internal Financial Controls are adequate and effective and

f. that the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating.

9. Evaluation of Board/Committees/Individual Directors

The Board routinely carries out the annual performance evaluation of its own performance, its Committees and Directors. The said exercise is led by the independent directors and the Chairman. The evaluation process focused on different aspects of the Board and Committees functioning such as composition of the Board and Committees, experience and competence, performance of specific duties and obligations, governance issues etc. Separate exercise was carried out to evaluate the performance of individual directors on parameters such as attendance, contribution and independent judgment. The aim was to assess the effectiveness of the Board’s/Committees’ processes, and to identify any actions required to improve effectiveness. The review thus focused on the following associated areas viz. structure, leadership, strategy, risks, decision making and development.

The evaluation process comprised the following:

• Review of Board, Committees and management information and other relevant documentation

• Meetings with key individuals within the organization.

• Discussions with all directors on the Board, Committee members focusing on aspects of the Board’s and Committees’ composition; strategy, risk and controls; decision-making, roles and performance of the Chairman, independent directors, executive directors and other non-executive directors.

Given the experience and qualifications of the Board members, it was not considered necessary to engage external persons to facilitate the evaluation process. Further, a meeting of Independent Directors, chaired by Shri Ajit Kumar, Chairman & Independent Director, was held pursuant to Schedule IV of the Act and the Listing Regulations to review the performance of the Chairman, Non-Independent Directors of the

Company and the performance of the Board as a whole. The Directors also discussed the quality, quantity and timeliness of flow of information between the Company management and the Board, which is necessary for the Board to effectively and reasonably perform their duties. Most directors have rich experience of corporate environment and so they are accustomed to having their performance regularly evaluated. The Directors have expressed their satisfaction with the evaluation process. As per the provisions of section 178(2) of Companies Act, 2013, the Nomination and Remuneration Committee carried out annual evaluation of each Director’s performance in its meeting held on 19th July, 2018.

10. Independent Directors

Independent Directors of your Company have complied with the relevant provisions of the law relating to their appointment and they continue to comply with the provisions of the Companies Act, 2013 and the listing regulations. All Independent Directors are in their first five year term. During the year ended 31/03/2018, 1 (one) meeting of Independent Directors was held on 24/01/2018.

Details of meeting(s) attended by the Independent Directors in the relevant period are as below:



Name of Director

Whether Chairman/ Member

No. of meetings attended during F.Y. 2017-18 & Dates


Shri Ajit Kumar





Dr. S. Ramesh





Shri R. Bandyopadhyay





Shri D.K. Mehrotra




11. Proper systems to ensure that compliances were adequate and effective

The professional conduct sets expectations that all employees shall comply with all laws and regulations governing company’s conduct. Information is reported upwards internally within the organization to senior management and, as appropriate, also shared with the Board of Directors and/or the external auditors. Information is reported externally in public filings, if it meets the criteria for requiring public disclosure.

12. Corporate Social Responsibility (CSR)

The Company is covered under the threshold prescribed under the Act for CSR. The Company had spent a total of Rs. 25,50,000/- in the financial year 2017-2018 for its chosen CSR initiatives as per the CSR policy.

A contribution of Rs. 20 lakhs was made to Lal Bahadur Shastri National Memorial Trust (“LBST”), 1 Motilal Nehru Place, New Delhi-110011 for construction of Laboratory for Mechanical Engineering course at Lal Bahadur Shastri Polytechnic in Village Manda, Near Allahabad (U.P.). Additionally, a contribution of Rs. 5.50 lakhs was made to a Gurgaon based non-profit organisation namely, IIMPACT which promotes primary education of girls in rural areas of Kanpur Dehat, Uttar Pradesh. All the CSR proposals are vetted and recommended by the CSR Committee to the Board of Directors for their approval.

Statement of CSR allocation and expenditure

(in Rs.)




Amount Unspent
























Less : Excess











# In the financial year 2016-17 the figure of profit before tax of Rs. 62,21,07,779/- was inadvertently considered for CSR calculations instead of Rs. 50,71,07,779/-. Accordingly allocation figure of Rs.44,19,495/- was computed involving excess allocation of Rs.7,66,667/-. The anomaly has now been corrected.

* Amount available for CSR expenditure in 2018-2019. The report of CSR Committee in terms of Section 135 of the Companies Act, 2013 is enclosed as Annexure-C to this report.

13. Number of Board Meetings

Relevant details have been provided in the report on corporate governance enclosed as Annexure D of this annual report.

14. Policies

Your Company has formulated following policies to better perform its functions and deliver results.

A. Corporate Social Responsibility Policy

The CSR policy can be accessed at company’s website viz. under the head ‘Investor Relations’.

B. Related Party Transaction

The detailed policy may be accessed at The Board of Directors (the “Board”) of VLS Finance Limited (the “Company”) has adopted this Policy. The said Policy includes the materiality threshold and the manner of dealing with Related Party Transactions (“Policy”) in compliance with the requirements of Section 188 of the Companies Act, 2013 and conforms to the requirements of regulation 23 of the Listing Regulations.

This Policy applies to transactions between the Company and one or more of its Related Parties. It provides a framework for governance and reporting of Related Party Transactions including material transactions.

This Policy is intended to ensure due and timely identification, approval, disclosure and reporting of transactions between the Company and any of its Related Parties in compliance with the applicable laws and regulations as may be amended from time to time.

C. Board diversity

The detailed policy may be accessed at VLS Finance Ltd. recognises and embraces the benefits of having a diverse Board and sees increasing diversity at Board level as an essential element in maintaining a competitive advantage. A truly diverse Board will include and make good use of differences in the skills, regional and industry knowledge and experience, background, race, gender and other distinctions between Directors. These differences will be considered in determining the optimum composition of the Board and when possible would be balanced appropriately. All Board appointments shall be made on merit, in the context of the skills, experience, independence and knowledge which the Board as a whole requires to be effective.

D. Risk Management

The detailed policy may be accessed at The Company has formed Risk Management Policy to ensure appropriate risk management within its systems and culture. The Company operates in a competitive environment and is generally exposed to various risks at different times such as technological risks, business risks, operational risks, financial risks, etc. The Board of Directors and the Audit Committee of the Company shall periodically review the Risk Management Policy of the Company so that the Management controls the risk through properly defined network.

The Company has a system based approach to business risk management backed by strong internal control systems. A strong independent Internal Audit Function at the corporate level carries out risk focused audits across all businesses, enabling identification of areas where risk managements processes may need to be improved. The Board reviews internal audit findings, and provided strategic guidance on internal controls, monitors the internal control environment within the Company and ensures that Internal Audit recommendations are effectively implemented.

The combination of policies and procedures adequately addresses the various risks associated with your Company’s businesses.

E. Anti-sexual harassment mechanism

The detailed mechanism may be accessed at The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. All women employees interalia permanent, contractual, temporary, trainees are covered under this policy.

The Internal Complaints Committee is headed by the woman Director on the Board. There were no complaints received from any employee or otherwise during the year under review and no complaints were pending as on 31/03/2018.

F. Nomination and Remuneration Policy Title:

This Policy shall be called ‘VLSF Nomination and Remuneration Policy.’


The provisions in the Companies Act, 2013 and corresponding provisions in the revamped Regulation 19 of the SEBl (Listing Obligations & Disclosure Requirements) Regulations, 2015 have ushered Indian corporate system in to a new era of Corporate Governance placing onerous governance responsibilities on the shoulders of the Board of Directors and Key Managerial Personnel of the Companies.

Section 178 of the Companies Act, 2013 and clause 49 of the Listing Agreement provide the necessary legal impetus for companies to have a policy and criteria for various matters like the remuneration of directors, key managerial persons and other employees, training of Independent Directors and performance evaluation of directors. Considering this it is necessary to ensure quality of persons on the Board of Directors of the Company as well as in the Key Managerial personnel, as these are the persons who are entrusted with the responsibility of policy formulation for, direction to and execution of the business and operations of the Company.


Board means the Board of Directors of VLS FINANCE LIMITED. Company means VLS Finance LIMITED.

Committee means Nomination and Remuneration Committee of Board of Directors.

Director means a person who has been appointed as such on the Board of the Company and includes Executive as well as NonExecutive Directors.

Executive Director means a Director who is in the whole time employment of the Company and includes a Managing Director as well as a Whole time Director and Manager, if member of the Board. Government includes Central Government as well as any of the State Governments, any statutory authority, tribunal, board or a governmental or semi-governmental authority or any authority or agency recognized by the Government.

HR Department means the Human Resource Department of the Company.

HR Policy means the Policy of the Company defining the criteria and process for the recruitment, training, appraisal etc. and dealing with other matters concerning the employees of the Company. Key Managerial Person means a person appointed as such by the Board under Section 203 of the Companies Act, 2013. Nomination & Remuneration Committee means the Committee of the Board constituted as such under the provisions of Section 178 of the Companies Act, 2013.

Non-Executive Director means a Director who is not in the whole time employment of the Company and includes an Independent Director, Promoter Director and Nominee Director.

Policy means this policy, as amended from time to time. Contents of the Policy:

This Policy contains following:

a) Process for the selection and appointment of Directors and Key Managerial Personnel;

b) Criteria for determining remuneration of the Directors, Key

Managerial Personnel and other employees of the Company; c) Training of Independent Directors.

(I) Selection of Directors and Key Managerial Personnel

In case of Executive Directors and Key Managerial Personnel, the selection can be made in either of the ways given below:

a) by way of recruitment from outside;

b) from within the Company hierarchy; or

c) Upon recommendation by the Chairman or other Director.

The appointment may be made either to fill up a vacancy caused by retirement, resignation, death or removal of an existing Executive Director or it may be a fresh appointment. In case of Non-Executive Directors the selection can be made in either of the ways given below:

a) by way of selection from the data bank of Independent Directors maintained by the Government.

b) Upon recommendation by Chairman or other Director. The appointment may be made either to fill up a vacancy caused by resignation, death or removal of an existing NonExecutive Director or it may be appointment as an additional director or an alternate director.

(II) Qualifications, Experience and Positive Attributes of Directors

a) While appointing a Director, it shall always be ensured that the candidate possesses appropriate skills, experience and knowledge in one or more fields of finance, law, management, sales, marketing, administration, research, corporate governance, technical operations or other disciplines related to the company’s business.

b) In case of appointment as an Executive Director, the candidate must have the relevant technical or professional qualifications and experience as are considered necessary based on the job description of the position. In case no specific qualification or experience is prescribed or thought necessary for the position then, while recommending the appointment, the HR Department shall provide the job description to the Committee and justify that the qualifications, experience and expertise of the recommended candidate are satisfactory for the relevant appointment. In such circumstances, the Committee may, if considered necessary, call for an expert opinion on the appropriateness of the qualifications and experience of the candidate for the position of the Executive Director.

c) In case of appointment as a Non-Executive Director, the candidate must be a graduate or possess diploma or a professional qualification in the field of his practice / profession / service and shall have not less than five years of working experience in such field as a professional in practice, advisor, consultant or as an employee, provided that the Board may waive the requirements of qualification and /or experience under this paragraph for a deserving candidate.

d) The Board, while making the appointment of a Director, shall also try to assess from the information available and from the interaction with the candidate that he is a fair achiever in his chosen field and that he is a person with integrity, diligence and open mind.

(III) Process for Appointment of Directors and Key Managerial Personnel

(A) Process for the appointment of Executive Directors and Key Managerial Personnel:

a) A proposal for the appointment of an Executive Director / Key Managerial Personnel with such details as may be prescribed shall be submitted for the consideration of the Committee. The proposal with recommendation of committee will be placed before the Board.

b) The Board shall, based on the information available in the proposal and recommendation of committee deliberate upon the necessity for appointment, expertise,

skill and knowledge of the candidate and reasonableness of the remuneration.

c) The Board may call and seek the help of any other Company Official including the recommender or a Key Managerial Personnel while finalizing the appointment. The recommender shall not take part in the discussion or voting on the appointment of a Key Managerial Personnel.

(B) Process for the appointment of Non- Executive Directors:

a) A proposal for the appointment of a Non-Executive Director with such details as may be prescribed shall be submitted for the consideration of the committee. The proposal with recommendation of committee will be placed before the Board.

b) The Board, based on the information available in the proposal, shall deliberate upon the necessity for appointment, integrity, qualifications, expertise, skill and knowledge of the candidate.

(IV) Remuneration of Directors, Key Managerial Personnel and other Employees

a) While determining the remuneration of Executive Directors and Key Managerial Personnel, the Board shall consider following factors:

i) Criteria / norms for determining the remuneration of such employees prescribed in applicable statutory provisions and Company’s internal criteria for remuneration.

ii) Existing remuneration drawn.

iii Industry standards, if the data in this regard is available.

iv) The job description.

v) Qualifications and experience levels of the candidate,

vi) Remuneration drawn by the outgoing employee, in case the appointment is to fill a vacancy on the death, resignation, removal etc. of an existing employee.

vii) The remuneration drawn by other employees in the grade with matching qualifications and seniority, if applicable.

b) The determination of remuneration for other employees shall be governed by the HR Policy.

c) The proposal for the appointment of an Executive Director / Key Managerial Personnel shall provide necessary information in this regard including recommendation of Committee to the Board in arriving at the conclusion as to whether or not the remuneration offered to the candidate is appropriate, reasonable and balanced as to the fixed and variable portions (including the commission).

d) The remuneration payable to the Executive Directors, including the Commission and value of the perquisites, shall not exceed the permissible limits as are mentioned within the provisions of the Companies Act, 2013.

e) The Executive Directors shall not be eligible to receive sitting fees for attending the meetings of the Board or committees thereof.

f) The Non-Executive Directors shall not be eligible to receive any remuneration / salary from the Company. However, the Non-Executive Directors shall be paid sitting fees for attending the meeting of the Board or committees thereof and commission, as may be decided by the Board / shareholders from time to time.

The Non-Executive Directors shall also be eligible to receive reimbursement of reasonable out-of-pocket expenses incurred by them for attending the meetings of the Board, committees or shareholders, including travelling and lodging & boarding expenses or such other expense incurred by them regarding the affairs of the

Company on an actual basis.

g) The amount of sitting fee and commission payable to Non-Executive Directors shall not exceed the limits prescribed therefor under the provisions of the Companies Act, 2013.

Explanation: For the purposes of this Policy, Remuneration shall mean the Cost to the Company and shall include the salary, allowances, perquisites, performance incentive and any other facility provided or payment made to the employee.

(V) Training of Independent Directors

The Company shall arrange to provide training to Independent Directors to familiarize them 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 etc.

The training may be provided in any of the ways given below:

a) By providing reading material to the Independent Director(s) giving all relevant information about the Company, industry and the role of Independent Directors.

b) An induction program devised for the Independent Director(s) wherein structured training is provided to the Independent Director(s) either exclusively or with other officials of the Company who are due for such induction / training.

c) Such other manner as may be prescribed by applicable law or decided by the Board.


a) Any words used in this policy but not defined herein shall have the same meaning ascribed to it in the Companies Act, 2013 or Rules made thereunder, SEBI Act or Rules and Regulations made thereunder, Listing Agreement, Accounting Standards or any other relevant legislation / law applicable to the Company.

b) The reference to the male gender in the Policy shall be deemed to include a reference to female gender.

c) In case of any dispute or difference upon the meaning / interpretation of any word or provision in this Policy, the same shall be referred to the Committee and the decision of the Committee in such a case shall be final. In interpreting such term / provision, the Committee may seek the help of any of the officers of the Company or an outside expert as it deems fit.


The Board of Directors shall have the power to amend any of the provisions of this Policy, substitute any of the provisions with a new provisions or replace this Policy entirely with a new Policy.

G. Vigil Mechanism /Whistle Blower

The Company is committed to adhere to the highest standards of ethical, moral and legal conduct of business operations. Vigil (whistleblower) mechanism provides a channel to the employees and directors to report to the management concerns about unethical behaviour, actual or suspected fraud or violation of the code of conduct or policy. The mechanism provides for adequate safeguards against victimization of directors and employees who avail of the mechanism and also provide for direct access to the Chairman of the Audit Committee in exceptional cases.

The detailed policy may be accessed at

15. Corporate Governance and Compliance Certificate

We have reported in Annexure D to this report, the extent of compliance of Corporate Governance practices in accordance with Regulation 34(3) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.

16. Auditors Statutory Auditors

In terms of Section 139 read with Companies (Audit and Auditors) Rules, 2014 M/s. M. L. Puri & Co. - Chartered Accountants, (FRN: 002312N)

had been appointed for a period of 5 years i.e. from the conclusion of 30th Annual General Meeting till the conclusion of 35th Annual General Meeting of the Company subject to ratification of their appointment by members every year and other compliances, if any as per applicable regulations.

However, with the enforcement of Section 40 of the Companies Amendment Act, 2017 w.e.f. 07/05/2018 the provision relating to ratification of appointment of Statutory Auditors in the intervening period as envisaged in Section 139 of the Companies Act, 2013 from Members had been omitted. The Government had also notified the amendment in relevant rules to this effect from the same date. The ratification of appointment of Statutory Auditors by the Members is, therefore, no longer required. The remuneration of Statutory Auditors for each financial year during their tenure would however continue to be fixed by the Members though they may authorise the Board to fix the remuneration every year. Such authorisation can be made for the remaining tenure of Auditors to obviate yearly authorisation. The Board recommends for your approval the proposal for authorising the Board to fix the remuneration of Statutory Auditors for remaining period of their tenure as set out in relevant item in the Notice for ensuing AGM.

Secretarial Auditor

The Board in its meeting held on 17/05/2018 has appointed Ms. Pooja Gandhi -Practicing Company Secretary (CoP:11351) as Secretarial Auditor for the year 2018-2019.

The provisions relating to cost records and audit are not applicable to your company.

17. Secretarial Audit Report

The Secretarial Audit Report submitted by Secretarial Auditor in terms of Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is enclosed as Annexure E. There are no adverse comments/observations by Secretarial Auditor requiring explanation by the Board.

18. Auditors’ Report

The observations made by the Statutory Auditors, with reference to notes on accounts for the year under report, have been adequately dealt with in the relevant Notes forming part of Financial Statements and need no further comments from Directors.

19. Statutory Information

- During the year under review, the Company did not absorb any new technology or carry out any R&D related activity for this purpose. However, use of energy efficient devices, wherever possible, in conducting business of Company is part of its administration policies. The detailed disclosure is enclosed as Annexure F to this report.

- The shares of the Company are presently listed at BSE Ltd., The National Stock Exchange of India Ltd., Mumbai and The Calcutta Stock Exchange Ltd., Kolkata. The proposal to delist the shares from the Calcutta Stock Exchange Ltd., where no trading of the Company’s shares had been done for past many years, is under consideration by the management.

- The Company has paid the annual listing fees for the year 20182019 to all the aforesaid Stock Exchanges.

- Your Company’s principle business is acquisition of securities; hence Section 186 of the Act is not applicable.

- Your Company has not issued equity shares with differential voting rights, sweat equity or ESOP in terms of Section 43 and Section 62 of the Companies Act, 2013, during the year under review.

- No revision of financial statements or Board’s Report has been made in terms of Section 131 of the Companies Act, 2013, during the year under review.

- For continuing the directorship of non-executive directors who have attained the age of seventy five years a special resolution would be required to be passed at the ensuing Annual General Meeting of the Company. This is pursuant to the SEBI Notification No. SEBI/ LAD-NR0/GN/2018/10 dated May 09, 2018 through which it has amended the SEBI (Listing Obligations and Disclosures Requirement) Regulations, 2015. This amendment is going to be effective from April 01, 2019. No independent director was reappointed through special resolution during the year under review.

- Disclosure relating to ratio of the remuneration of each director to the median employee’s remuneration in terms of Section 197(12) of the Companies Act, 2013 is enclosed as Annexure G to this report.

- Executive Vice-Chairman, Managing Director and Director- Finance & CFO of your company are not in receipt of any remuneration or commission from any of subsidiary company in terms of Section 197(14) of the Companies Act, 2013.

- There were no orders passed by the regulators against the Company.

- Senior management have made requisite disclosures to the Board relating to all material financial and commercial transactions.

20. Fixed Deposits

The Company has not accepted any fixed deposit during the year under review. The Company has no plans to accept any deposits from the public in the current year.

21. Human Resources

Employee relations continued to be cordial during the year. The number of employees stood at 30 (Thirty). The Directors place on record their appreciation of the devoted service of the employees at all levels. In terms of the provisions of Section 197 of the Companies Act 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, there was no employee during the year drawing remuneration more than the stipulated amount in the said rules. Your Company has not approved any scheme relating to provision of money to be held in a trust for the benefit of the employees in terms of Section 67(3)(b) of the Companies Act, 2013 during the year under review.

22. Green initiative in Corporate Governance

As a continuing endeavor towards the Go Green Initiative, the Company has been sending documents like the notice calling the general meeting, audited financial statements, directors'' report, auditors'' report etc. in electronic form, to the email addresses provided by the members directly or made available to us by the depositories, besides regular correspondence. The electronic mode is both economical and speedier compared to physical documents. Members who hold shares in physical form are, therefore, requested to register their e-mail addresses and intimate any change in e-mail id, with the Company or with the Registrar & Share Transfer Agents, RCMC Share Registry Pvt. Ltd. In respect of electronic holdings, members are requested to register their e-mail addresses with the depository through their concerned depository participants. You may kindly note that even after registration of e-mail ID, you are entitled to be furnished, free of cost, a printed copy of the annual report of the Company, upon receipt of a requisition from you, at

any time. In case you desire to receive Company’s communication and documents in physical form, you are requested to intimate us through email at

23. Subsidiary/Associate Companies

Statement pursuant to Section 129(3) of the Companies Act, 2013 for the financial year ended 31/03/2018 in respect of the subsidiary/associate companies, is enclosed with Annual Accounts of the Company.

After coming into effect of the Companies Act, 2013, the definition of “Associate” covers a Company or Companies in which the Company holds not less than 20% of the total share Capital of that company or those companies irrespective of whether they are in the same group or not. Hence, though Sunair Hotels Ltd. and BMS IT Institute Pvt. Ltd are presently not in the same group still Accounting Standard 23 has been followed for the limited purpose of consolidation of annual accounts of these companies. However, as regards the notes on account and significant accounting policies related to these companies are concerned, the Company has not considered the same as the Company is in litigation with these companies. In the opinion of the Board, there is no adverse impact of such litigation on investments/advances made by the Company in these associates and the amount realizable from the said investments/ advances would not be less than the amount stated in the Company’s own financial statements.

Separate section on performance and financial position of subsidiary and associate companies have been provided as note no. 23 sub-note 16 & 17 of Notes forming part of consolidated financial statement in the Annual Report for the year under review.

24. Consolidated Financial Statements

In compliance of Section 129(3) of the Companies Act, 2013, the consolidated financial statements in accordance with the prescribed accounting standards are annexed to the audited annual accounts for the year under review.

25. Acknowledgements

Your Directors wish to place on record their sincere appreciation and gratitude to the Company’s business associates, customers, Bankers, the Securities & Exchange Board of India and Stock Exchanges for their continued support and assistance and also to the esteemed shareholders of the Company, for their valuable support and patronage.

For and on behalf of the Board of Directors

Place : New Delhi S.K. Agarwal K.K. Soni

Date : 19/07/2018 Managing Director Director-Finance & CFO

DIN:00106763 DIN:00106037

Director’s Report