DIRECTORS' REPORT Dear Members, The Board of Directors is pleased to present the 79th Annual Report on the business and operations of your Company along with the audited financial statements for the financial year ended 31st March, 2016 2. DIVIDEND Your Directors do not recommend any dividend due to losses incurred during the year. 3. RESERVES During the year your Company has not transferred any amount to general reserve. 4. BUSINESS The Company was in appeal against the M.C. order before the Bombay High Court and the High Court has given its adverse ruling vide their order dated 22nd, 25th and 27th January, 2016. The Company has gone in appeal before the Supreme Court and SLP is pending before the Supreme Court. Once the project is complete, it will firmly establish the Company in the field of real estate and urban infrastructure development. 5. CORPORATE SOCIAL RESPONSIBILITY Your Company understands and values Corporate Social Responsibility (CSR) initiatives of the Government and has also noted the requirements of CSR activities in terms of Companies Act, 2013. The requirement of mandatory implementation of CSR activity is not applicable to your company due to inadequacy of profits in past three financial years. 6. CHANGES INTHE NATURE OF BUSINESS There is no change in the nature of business of the Company during the year. 7. PUBLIC DEPOSITS Your Company has neither accepted nor renewed any deposit within the meaning of Section 73 and other applicable provisions, if any, of the Companies Act, 2013 and the necessary rules made there under during the year ended 31st March, 2016. 8. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS The particulars of loans, guarantees and investment have been disclosed in Note No. 13, 14 and 18 to the financial statements. 9. MATERIAL CHANGES AND COMMITMENTS There has been no material changes and commitment affecting the financial position of the Company during the financial year 2015-2016 except as disclosed in the Financial Report. 10. REPORT ON PERFORMANCE OF SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES As on 31st March, 2016 the Company had the following subsidiaries companies: a) SRM Sites Private Limited b) Raghuveer Suburban Infrastructure Private Limited c) Shree Ram Realinfra Ventures Private Limited A report on the performance and financial position of each of the subsidiaries companies as per the Companies Act, 2013 in Form AOC - 1 forms part of Financial Statement. During the year the company does not have Associates or Joint Venture Companies. 11. DIRECTORS AND KEY MANAGERIAL PERSONNEL Mr. S.S.Kasliwal (DIN: 00555161), retires by rotation at the ensuing 79th Annual General Meeting and being eligible, offers himself for re-appointment. The Board recommends his reappointment. The Board of Directors (based on the recommendation of Nomination and Remuneration Committee) has appointed Mr. S.P.Banerjee (DIN: 00030895) as an Additional - Independent Director of the Company on 29th April, 2016. The Board of Directors (based on the recommendation of Nomination and Remuneration Committee) has appointed Mrs. Dhvani Kaul (DIN: 00332167) as an Additional - Non Executive Director of the Company on 29th April, 2016. The Board and the Nomination and Remuneration Committee has decided to reappoint Mr. S. K. Luharuka, (DIN: 01068251) as Whole-Time Director for a further period of 5 (five) years with effect from 1st January, 2017. The Board recommends his reappointment. During the year under review, Dr. Poornima Advani resigned from the office of Independent Director of the Company w.e.f. 3rd March, 2016. The Board of Directors places on record her valuable contribution and guidance given to the Company during her tenure. 12. DECLARATION BY AN INDEPENDENT DIRECTOR(S) Pursuant to section 149(7) of the Companies Act, 2013, the Company has obtained declarations from all the Independent Directors that they meet the criteria of independence as provided in sub-section (6) of Section 149 of the Companies Act, 2013. 13. FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTOR The provision of an appropriate induction for new Directors and ongoing training for existing Directors is a major contributor to the maintenance of high Corporate Governance standards of the Company. The Independent Directors, from time to time request management to provide detailed understanding of any specific project, activity or process of the Company. The management provides such information and training either at the meeting of Board of Directors or otherwise. The details of familiarization are available on the Company's website <http://www.shreeramurban.co.in/InvestorsCentre.html> 14. EXTRACT OF ANNUAL RETURN Extract of the Annual Return in Form MGT-9 for the financial year ended 31st March, 2016 made under the provisions of Section 92(3) of the Act is annexed to this report as "Annexure A". 15. NUMBER OF BOARD MEETINGS During the financial year 2015-2016, 5 (Five) meetings of the Board of Directors were held. The dates of Board Meetings are given in the Corporate Governance section, forming part of the Board's Report. 16. DIRECTOR'S RESPONSIBILITY STATEMENT As required by Section 134(5) of the Companies Act, 2013 the Directors hereby state that: a. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures; b. selected accounting policies were applied 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, 2016 and of the loss of the Company for the year ended on that date; c. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; d. the annual accounts have been prepared on a going concern basis; e. Internal financial controls to be followed by the Company have been laid down and that such internal financial controls are adequate and were operating effectively. f. proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and are operating effectively. 17. NOMINATION AND REMUNERATION COMMITTEE The Board has in accordance with the provisions of sub-section (3) of Section 178 of the Companies Act, 2013, formulated the policy setting out the criteria for determining qualifications, attributes, independence of a Director and policy relating to remuneration for Directors, Key Managerial Personnel and other employees. The said policy is annexed to this Report as "Annexure B". The said policy is available on the Company's website <http://www.shreeramurban.co.in/InvestorsCentre.html> 18. PARTICULAR OF CONTRACTS OR ARRANGEMENTWITH RELATED PARTIES The Company has formulated a policy on dealing with Related Party Transaction. The said policy is available on the Company's website <http://www.shreeramurban.co.in/InvestorsCentre.html> . Pursuant to the provisions of Regulation 23 of Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, prior approval of Audit Committee was sought for entering into related party transactions. During the year the Company had entered into material related party transaction with Mr. Vikas Kasliwal, Vice Chairman and CEO and his family members as per Clause 49 of the Listing Agreement. The Company had taken the approval from the shareholders by way of postal ballot in the month of September, 2015 for entering into material related party transaction as per Clause 49 of the Listing Agreement. The result on postal is available on the Company's website <http://www.shreeramurban.co.in/InvestorsCentre.html> The particulars of contracts entered during the year as per Form AOC-2 is annexed to this report as "Annexure-C". 19. BOARD EVALUATION The Board of directors has carried out an annual evaluation of its own performance, Board committees and individual directors pursuant to the provisions of the Act. The performance of the Board was evaluated by the Board after seeking inputs from all the directors on the basis of the criteria such as the Board composition and structure, effectiveness of board processes, information and functioning, etc. The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, effectiveness of committee meetings, etc. The Board and the Nomination and Remuneration Committee ("NRC") reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In a separate meeting of independent Directors, performance of non-independent directors, performance of the board as a whole and performance of the Chairman was evaluated, taking into account the views of executive directors and non-executive directors. The same was discussed in the board meeting that followed the meeting of the independent Directors, at which the performance of the Board, its committees and individual directors was also discussed. 20. VIGIL MECHANISM POLICY FORTHE DIRECTORS AND EMPLOYEES The Company has established a vigil mechanism for directors and employees to report genuine concerns. The vigil mechanism provides for adequate safeguards against victimization of person who use vigil mechanism and also provide direct access to Chairman of the Audit Committee in appropriate and exceptional cases. The said policy is available on the Company's website <http://www.shreeramurban.co.in/InvestorsCentre.html> 21. AUDIT COMMITTEE The composition of the Audit Committee as required to be disclosed under section 177(8) of the Companies Act, 2013 is given in Corporate Governance Report forming part of Board's Report. During the year under review there was no instance where the Board has not accepted any recommendation of the Audit Committee. 22. RISK MANAGEMENT At present there is no identifiable risk which, in the opinion, of the Board may threaten the existence of the Company. 23. SECRETARIAL AUDITOR The Board has appointed M/s. Virendra Bhatt, Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year 2015-2016. The Report of the Secretarial Audit Report is annexed to this report as "Annexure D". 24. DISCLOSURE RELATING TO REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND PARTICULARS OF EMPLOYEES The details as per section 197(12) of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel)Rules, 2014, is annexed to this report as "Annexure E". 25. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO The information on conservation of energy, technology absorption, foreign exchange earnings and outgo stipulated under section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of The Companies (Accounts) Rules, 2014 is annexed to this report as "Annexure - F". 26. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS The Company was in appeal against the M.C. order before the Bombay High Court and the High Court has given its adverse ruling vide their order dated 22nd, 25th and 27th January, 2016. The High Court has held that the construction of the Public Parking Lot above the plinth level and the construction of the floors above 43rd floor of the main building is illegal. As the same have been constructed without obtaining commencement certificate. However it will be open for the petitioner to apply for regularization of the same within a period of 5 months from today. The Company has gone in appeal before the Supreme Court and SLP is pending before the Supreme Court. 27. INTERNAL FINANCIAL CONTROLS Adequate internal control systems commensurate with the nature of the Company's business, size and complexity of its operations are in place. It has been operating adequately 28. MANAGEMENT DISCUSSION AND ANALYSIS REPORT As required under Regulation 34(2)(e) Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Management Discussion and Analysis Report is annexed to this report as "Annexure G". 29. DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013 The Company has constituted Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013. Your company has always believed in providing a safe and harassment free workplace for every individual employee working with company. No instance of sexual harassment of women under the said Act has been reported in the Company. 30. STATUTORY AUDITORS M/s Habib & Co. Chartered Accountants (Firm Registration No. 103479W), Mumbai are the present Statutory Auditors of the Company. They retire at the ensuing Annual General Meeting and have confirmed their eligibility and willingness to accept office, if re-appointed. The Board of Directors recommends their re-appointment. 31. EXPLANATIONTOTHE QUALIFICATION IN AUDITORS REPORT The explanation to the qualification in Auditors report is already given in note no. 42 which is self explanatory. 32. COST AUDITORS The Board of Directors, on recommendation of the Audit Committee, has appointed M/s. Y.R.Doshi & Associates, Cost Accountants, as Cost Auditors of the Company, for the Financial Year 2016-17, for conducting the audit of the cost records maintained by the Company for the various products as mandated by the Central Government, pursuant to its order dated 30th June, 2014 and any amendments thereof, subject to the approval of the Members, on the remuneration of Rs. 30,000/- to be paid to the Cost Auditor. The Board recommends their appointment. 33. GENERAL DISCLOSURES Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review: (A) ISSUE OF SHAREWITH DIFFERENTIAL RIGHTS The Company has not issued any shares with differential rights and hence no disclosure is required as per provisions of Section 43(a)(ii) of the Act read with Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014. (B) ISSUE OF SWEAT EQUITY SHARES The Company has not issued any sweat equity shares during the year under review and hence no disclosure is required as per provisions of Section 54(1)(d) of the Act read with Rule 8(13) of the Companies (Share Capital and Debenture) Rules, 2014. (C) ISSUE OF EQUITY SHARES UNDER EMPLOYEE STOCK OPTION SCHEME The Company has not issued any equity shares under Employees Stock Option Scheme during the year under review and hence no disclosure is required as per provisions of Section 62(1)(b) of the Act read with Rule 12(9) of the Companies (Share Capital and Debenture) Rules, 2014. 34. ACKNOWLEDGEMENTS Your Directors place on record their sincere appreciation for the dedication and commitment of the Employees at all levels and their significant contribution to your Company's growth. Your Company is grateful to the customers, vendors and all the other business associates for their support and encouragement. Your Directors thank the banks, financial institutions, government departments and Shareholders and look forward to having the same support in all our future endeavors. For and on behalf of the Board Shambhukumar S. Kasliwal Chairman DIN:00555161 Place: Mumbai Date : 17th May, 2016 |