The directors have pleasure in presenting the 32nd Annual Report along
with the Audited Accounts for the financial year ended March 31, 2015.
FINANCIAL RESULTS:
Summary of the Company's financial performance for F.Y. 2014-2015 as
compared to the previous financial year is given below:
(Figures in Lacs)
Particulars F.Y. F.Y.
2014 - 2015 2013 - 2014
Income 745.60 562.67
Profit before Dep. & Int. 39.52 30.67
Depreciation 2.11 3.00
Interest 76.68 21.91
Profit after Depreciation & Interest (39.27) 5.76
Provision for Taxation 0.00 0.00
Provison for Tax (deferred) 0.32 2.48
Provision for Taxation for earlier year (150.00) 0.00
Profit/ Loss after Tax (191.04) 3.28
Balance carried to Balance Sheet (191.04) 3.28
HIGHLIGHTS:
The company is mainly engaged into Investment and Finance activities.
Over the reporting period, the total income of the company has
increased to Rs. 745.60 Lacs from Rs. 562.67 Lacs as compared to
previous financial year. The growth performance for financial year
2014-15 was affected by global economic and financial challenges all
around the world including India. Henceforth every sector and company's
performance and profitability suffered. The capital spending was at
lower side. The company has incurred net loss of Rs. 191.10 during the
year as compared to 3.28 net profit in previous year. The main
attributes for incurring such huge loss mainly due to Tax Demand raised
by the Income tax Authority of Rs.1.5 Crores for the previous and high
administrative and business running expenses.
The management of the Company hereby very optimistic regarding
performance of the Company in furture and taking every steps and making
every efferts to turn the Company in to profitable organization
DIVIDEND:
During the year, company incurred losses; your ectors have not
recommended any dividend on Equity Shares for the year under review.
BDARD DF ECTORS:
The Composition of the Board during the year as per the provisions of
Clause 49(IIA) read with the Companies Act, 2013. During the period
under review, Mr. Tushar Ramchandra Rane, Mrs. Madhu Rajkumar Goel and
Mr. Dauji Chaturvedi had resigned from the Board with effect from 24th
March 2015 and 28th May 2015 respectively due to their preoccupations
somewhere else. The Board places on record their appreciation and
gratitude for their guidance and contribution during their association
with the Company.
On the recommendation of Nomination and Remuneration Committee, your
Board inducted Ms. Seema Nirmalsingh Sidhu and Mr. Jatinkumar Chintamani
Agarrwal as an Additional ectors of the Company in the category of
Independent ector with effect from 24th March, 2015 in order to comply
with the requirement of Section 149(1) of the Companies Act, 2013. In
terms of Section 161 of the Companies Act, 2013 she will hold office up
to the date of the ensuing Annual General Meeting. The Company has
received a notice in writing along with deposit pursuant to Section 160
of Companies Act, 2013, proposing the appointment of Ms. Seema Sidhu and
Mr. Jatinkumar Agarrwal, ectors of the Company. Your Board has
recommended the appointment of Ms. Seema Sidhu and Mr. Jatinkumar
Agarrwal as Independent ectors of the company for a period of five
consecutive years up to the fifth consecutive Annual General Meeting of
the Company, not liable to retire by rotation.
During the year Pursuant to Section 152 of the Companies Act, 2013 Mr.
Girraj Kishor Agrawal, ector, retires by rotation at the ensuing Annual
General Meeting and being eligible offers himself for re-appointment.
Your Board has recommended his re-appointment.
Ms. Seema Sidhu and Mr. Ashwin Shah have given declarations that they
continues to meet the criteria of independence as laid down under
Section 149(6) of the Act and Clause 49 of the Listing Agreement.
As required under clause 49 of the listing agreement with the stock
exchanges, the information on the particulars of ectors proposed for
appointment/re-appointment has been given in the notice of annual
general meeting.
DEPOSITS:
Your Company has not accepted any deposits within the meaning of
Section 73 (1) and 74 of the Companies Act, 2013 read together with the
companies (Acceptance of Deposits) Rules, 2014.
DIRECTORS' RESPONSIBILITY STATEMENT:
In accordance with the provisions of Section 134 (3) (c) of the
Companies Act, 2013, and based on the information provided by
management, your ectors' state that:
a) In the preparation of the annual accounts for the financial year
ended 31st March, 2015 the applicable accounting standards have been
followed.
b) Accounting policies selected were applied consistently. Reasonable
and prudent judgments and estimates were made so as to give a true and
fair view of the State of affairs of the corporation as at the end of
March 31, 2015 and of the profit of the Company for the year ended on
that date.
c) Proper and sufficient care to the best of their knowledge and
ability 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) The Annual Accounts of the Company have been prepared on the ongoing
concern basis.
e) That they have laid down internal financial controls commensurate
with the size of the Company and that such financial controls were
adequate and were operating effectively.
f) That system to ensure compliance with the provisions of all
applicable laws was in place and was adequate and operating
effectively.
DECLARATION OF INDEPENDENCE BY ECTORS:
The Independent Non-executive ectors of the Company, viz. Mr. Ashwin
Jayantilal Shah and Ms. Seema Nirmalsingh Sidhu have affirmed that they
continue to meet all the requirements specified under Clause
49(I)(A)(iii) of the listing agreement in respect of their position as
an "Independent ector" of Banas Finance Limited.
POLICIES ON ECTORS' APPOINTMENT AND REMUNERATION:
The policies of the Company on ectors' appointment and remuneration
including criteria for determining qualifications, positive attributes,
independence of a ector and other matters provided under sub-section
(3) of Section 178 of the Act is appended as Annexure I to this Report.
EVALUATION OF BOARD OF ECTORS:
Pursuant to the provisions of the Act and Clause 49 of the Listing
Agreement, the Nomination and Remuneration Committee of the Board
carried out the annual evaluation of the performance of the Board as a
whole, the ectors individually as well as of various Committees of the
Board. The performance evaluation of the Independent ectors was carried
out by the Nomination and Remuneration Committee and noted in turn by
the Board.
STATUTORY AUDITORS:
M/s. Pravin Chandak & Associates, Chartered Accountants having
Registration No. 116627W, who are Statutory Auditors of the Company
hold office up to the forthcoming Annual General Meeting and are
recommended for re-appointment to audit the accounts of the Company for
the Financial Year 2015-16. As required under the provisions of Section
139 of the Companies Act, 2013, the Company has obtained written
confirmation from M/s. Pravin Chandak & Associates, that their
appointment, if made, would be in conformity with the limits specified
in the said Section.
AUDITORS REPORT:
Observations made in the Auditors' Report are self-explanatory and
therefore do not call for any further comments under Section 134 (1) of
the Companies Act, 2013.
COMMENTS ON REMARKS/OBSERVATION/QUALIFICATION MADE BY STATUTORY
AUDITORS:
M/s. Pravin Chandak and Associates, Practicing Chartered Accountant, in
his Independent Auditor Report for financial year 2014-15 have drawn
the attention of the management on some Prudential Norms of NBFC, which
have been marked as qualification in his report. In connection with the
same management here with give the explanation for the same as follows:
Your Company is Small NBFC, as compare to other giant in market.
Company had not accepted any deposits from public. The Company is
doing business out of its own fund. The Company operates its business
with at most care and diligence. As far as making of Loan and Advances
are concerned, management grants demand loan only either to the parties
known to the Company or by reference which are governed by the Board
policies. Considering the close monitoring of Board no appraisal,
renewal, Policies and Procedure, therefore in some cases loan
agreements or some KYC were not maintained. However your ectors are of
a view that the Company has maintained all basic and necessary
documents, but according to the auditor the documents are not
appropriate/enough. The Company is under process to make KYC documents
in line with auditor's ections, for all future loan agreement and
contracts to be entered.
The Loans and Advances granted by the Company is cosidered as good and
recoverable and do not required any provisions and same has been
closely supervised and monitered on regular basis and proper internal
control is on place.
The management of the Company is quite confident that there is/was no
NPA. The Company grants unsecured loan either to the parties to whom
Company knows personally or to the parties, whose reference has been
received from, some parties with whom Company has already done the
business. Though the repayment of the loan and interest there on might
have been delayed some time by the parties, but Company do receive the
payment on later date.
The Company has received Order u/s 143(3) of Income Tax Act, 1961 dated
28/03/2014 for an outstanding income tax demand of Rs.7,74,50,120/-
pertaining to A.Y. 2011-12 in reply of the same Company has filed
appeal before CIT(A) on 04/04/2014, the Income Tax department has
granted stay on the order of demand and ected Company to pay
installment of Rs.15,00,000/- for ten months from June 2014 to March,
2015 till further order.
The Company has also received the notice u/s 154 of Income Tax Act,
1961 dated 21/08/2014, charging interest of Rs.2,36,52,216/- u/s 234B
in addition to demand. As far as contingent liability of
Rs.7,74,50,120/- is concerned, the same is not provided as the
management feels that the demand raised is likely to be either deleted
or substantially reduced as the company has filed appeal in response to
the demand raised by the Assessing Officer deposited tax of Rs.
1,50,00,00 in response to the demand raised by the assessing officer
and accordingly no provision is considered.
SECRETARIAL AUDIT:
Pursuant to the requirements of Section 204(1) of the Act, and Rule 9
of Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014, the Company has appointed M/s. P.D. Pandya & Associates,
Company Secretary in Practice to conduct the Secretarial Audit for the
financial year 2014-15. The Secretarial Audit Report as received from
M/s. P.D. Pandya & Associates is appended to this Report as Annexure
II.
COMMENTS ON REMARKS/OBSERVATION/QUALIFICATION MADE BY SECREATARIRAL
AUDITORS:
M/s. P.D. Pandya and Associates, Company Secretary in Practice, in his
Secretarial Audit Report for financial year 2014- 15 have drawn the
attention of the management on some the non-compliances, which have
been marked as qualification in his report. In connection with the same
management herewith give the explanation for the same as follows:
As pointed out by our Secretarial Auditors in their report, it was a
matter of fact that Income Tax Authority had conducted income tax
search on 9th June, 2015 and 10th June, 2015. During their search they
had confiscated Minutes Books and certain other documents for their
reference due to which the company could not produce physical copy of
the Minutes Books to the secretarial auditor for their verification.
However, the soft copy of the minutes was produced before the auditor
and the same was verified by them.
As far as the appointment of Internal Auditor and Internal Control is
concerned, The Management of the Company is of a view that the
Company's size is very small as compared to its peer group companies,
the Company has already in place Risk Management Policy to cope up with
unforeseeable threats, risks and frauds. The management thinks that
Company has adequate Internal Control System commensurate with the size
of the Company and the Statutory Auditor also conduct test audit on
quarterly basis and submit the limited review certificate and draws the
attention of the management on concerned matters. However the
Management also ensures to strengthen the Internal Control System of
the Company. However to make good of said default Company has appointed
M/s. A M Gohel & Co., as Internal Auditor of the Company in current
financial year for conducting periodic internal audit in compliance of
Section 138 of Companies Act, 2013.
Mr. Girraj Kishor Agarwal, ector of the Company, also the Manging ector
of M/s. Tilak Finance Limited and M/s. Banas Finance Limited, a group
companies. As all these Companies is being operated from the same
place, which will allows him to devote full time to all companies by
sitting at same place, with the view of the same Mr. Girraj Kishor
Agrawal was also appointed as CFO of the Company. However the same
contravenes the provision of section 203 of Companies Act, 2013 that
one person cannot held position of KMP in more than one Company. To
ensure the Compliance with said section Company has suggested to Mr.
Girraj Kishor Agarwal to take resignation from the post of CFO of the
Company and confirmed with Mr. Girraj Kishor Agarwal.
REPORTS DN CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION S ANALYSIS:
The reports on Corporate Governance and Management Discussion and
Analysis for the year under review, as stipulated under Clause 49 of
the Listing Agreement form part of the Annual Report. The certificate
from the Auditors of the Company confirming compliance with the
conditions of Corporate Governance is annexed to the Corporate
Governance Report.
PARTICULARS DF CONTRACTS DR ARRANGEMENTS WITH RELATED PARTIES:
The particulars of contracts or arrangements with related parties
referred to in Section 188(1), as prescribed in Form AOC - 2 are
appended as Annexure III.
EXTRACT PF ANNUAL RETURN:
Pursuant to the requirements under Section 92(3) and Section 134(3) of
the Act read with Rule 12 of Companies (Management and Administration)
Rules, 2014, an extract of Annual Return in prescribed Form MGT-9 is
given in the Report as Annexure IV.
PARTICULARS OF EMPLOYEES AND RELATED INFORMATION:
In terms of the provisions of Section 197(12) of the Act read with Rule
5 of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, a statement containing the disclosures
pertaining to remuneration and other details as required under the Act
and the above Rules are provided in the Annual Report. The disclosures
as specified under Rule 5(1) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, have been appended
to this Report as Annexure V.
POSTAL BALLOT:
No postal ballot was held during the year 2014-2015.
RISK MANAGEMENT AND INTERNAL CONTROLS:
The Company has the risk management and internal control framework in
place commensurate with the size of the Company. However Company is
trying to strengthen the same. The details of the risks faced by the
Company and the mitigation thereof are discussed in detail in the
Management Discussion and Analysis report that forms part of the Annual
Report.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:
Details of the Investments covered under the provisions of Section 186
of the Companies Act, 2013 (Act) will be produced for verification to
the members at the registered office of the Company on their request.
CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION:
The Company, being a non-banking finance company (NBFC), does not have
any manufacturing activity. The ectors, therefore, have nothing to
report on 'conservation of energy and technology absorption'.
FOREIGN EXCHANGE:
There is no inflow and outflow of Foreign Exchange.
LISTING OF SHARES:
Equity shares of your Company are listed on Bombay Stock Exchange only
and the Company has paid the necessary Listing fees for the year 2015 -
2016.
VIGIL MECHANISM/WHISTLE BLDWER POLICY:
The Company has established a vigil mechanism to provide appropriate
avenues to the ectors and employees to bring to the attention of the
Management, the concerns about behavior of employees that raise
concerns including fraud by using the mechanism provided in the Whistle
Blower Policy. The details of the said Policy are included in the
Report on Corporate Governance which forms part of the Annual Report.
During the financial year 2014-15, no cases under this mechanism were
reported in the Company and any of its subsidiaries/ associates.
PDLICY FDR PREVENTION, PRDHIBITIDN AND REDRESSAL DF SEXUAL HARASSMENT
DF WDMEN AT WORKPLACE:
The company has framed policy in accordance with The Sexual Harassment
of Women at Workplace (Prevention, Prohibition and Redressal) Act,
2013.
During the financial year 2014-15, no cases in the nature of sexual
harassment were reported at any workplace of the company.
CED AND CFD CERTIFICATION:
The Chief Executive Officer and Chief Financial Officer Certification
as required under Clause 49 of the Listing Agreements and Chief
Executive Officer declaration about the Code of Conduct is Annexed to
this Report.
ACKNOWLEDGEMENT:
The Board of ectors wishes to express sincere thanks to Bankers,
Shareholders, clients, Financial Institutions, customers, suppliers and
employees of Companies for extending support during the year
FOR & ON BEHALF OF THE BOARD
Sd/-
Girraj Kishor Agrawal
(Director & CFO)
Place: Mumbai
Date: 10/08/2015
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