DIRECTORS' REPORT_ Dear Members, Your Company's Directors are pleased to present the 23rd Annual Report of the Company, along with Audited Accounts, for the Financial Year ended 31st March 2015 STATE OF COMPANY'S AFFAIRS The fiscal year 2014-15 continued to be subdued for property development business as the Indian economy did not progress much. There were continued challenges and uncertainties in the Real Estate business with high interest rates and negative customer sentiments. The real estate market and customer sentiments work in tandem with the growth of the Indian economy. With the revival of Indian economy, your Company hopes that the real estate would also start seeing revival but in a very gradual manner. The Management and Directors will review business plan and existing status of the Company and take necessary action based on the same, in the best interest of the Company and its stakeholders. EXTRACT OF ANNUAL RETURN An Extract of Annual Return (as provided in Section 92(3) of the Companies Act, 2013) in Form MGT-9 as on 31st March 2015 is attached asAnnexure-1 to this report NUMBER OF MEETINGS OF THE BOARD During the year, 06 (Six) meetings of the Board of Directors were held. The details of the meetings are furnished in the Corporate Governance Report which is attached to this report. In respect of all such meetings proper notices were given and the proceedings were properly recorded and signed in the minutes book maintained for the purpose. The intervening gap between any two meetings was within the period prescribed underthe companies Act,2013. DIRECTORS' RESPONSIBILITY STATEMENT To the best of our knowledge and belief and according to the information and explanations obtained by us, your Directors make the following statements in terms of Section 134(5) of the Companies Act, 2013 I. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures; ii. the Directors 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 as at 31st March 2015 and of the profit of the Company for the year ended on that date; iii. the Directors have 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; iv. the Directors have prepared the annual accounts on a going concern basis; v. the Directors have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively; vi. the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. DIRECTORS AND KEY MANAGERIAL PERSONNEL AND CHANGES The Board of Directors of the company comprises of a Whole Time Director, and Six Non-Executive including Three Independent Directors. The Companies Act, 2013, provides for the appointment of independent Directors. Sub-section (10) of Section 149 of the Companies Act, 2013 provides that Independent Directors shall hold office for a term of up to five consecutive years on the Board of a company; and shall be eligible for re-appointment on passing a Special resolution by the shareholders of the Company. Accordingly, all the Independent Directors Shri.D.Karunanidhi(DIN-02189272), Shri.Gouthamchand (DIN-02554942) and Shri.Prakashchand Pramodh (DIN-05209299) were appointed by the shareholders at the Annual General meeting as required under Section 149(10) for a period of Five years. They are not liable to retire by rotation. Smt.Pushpa Dugar (DIN:02775120), was co-opted as an Additional Director [Non-Executive (Women)] of the Company with effect from March 30,2015 pursuant to Section 161 of the Companies Act, 2013 read with in terms clause 49 of the Listing Agreement. Smt.Pushpa Dugar (DIN:02775120), holds office of Director upto the date of ensuing Annul General Meeting. In terms of Section 152 of the Companies Act, 2013, Shri.T.Ramesh Dugar (DIN: 01735878) retires at the ensuing Annual General meeting. The Board of Directors based on the recommendation of Nomination and Remuneration Committee, have recommended the re-appointment of Shri.T.Ramesh Dugar (DIN: 01735878) and Smt.Pushpa Dugar (DIN:02775120), at the ensuing Annual General Meeting. Further, in terms of section 203 of the Companies Act, 2013 and read Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, every listed company shall have whole-time key managerial personnel. Necessary steps being initiated to recruit Chief Financial Officer and Company Secretary. DECLARATION FROM INDEPENDENT DIRECTORS The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under Section 149(6) of the Companies Act 2013 and Clause 49 of the Listing Agreement with the Stock Exchanges. SEPARATE MEETING FOR INDEPENDENT DIRECTORS In accordance with the provisions of the Companies Act, 2013, a separate meeting of the Independent Directors of the Company was held on March 30,2015. APPOINTMENT AND REMUNERATION POLICY The Company's policy on Directors appointment and remuneration and other matters provided in Section 178(3) of the Act has been provided in the Corporate Governance Report, which is attached to this report as Annexure - 3 AUDITORS AND AUDITORS' REPORT STATUTORY AUDITOR At the Annual General Meeting of the Company held on September 29,2014, M/s.Krishnakumar & Associates, Chartered Accountants, (Registration No.FRN 006853S), were reappointed as the Statutory Auditors of the Company for a period of 5 years which is subject to annual ratification by the members of the Company in terms of Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014. Accordingly, the appointment of M/s.Krishnakumar & Associates, Chartered Accountants, as statutory auditors of the Company, is placed for ratification by the shareholders. In this regard, the Company has received a certificate from the auditors to the effect that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013. The Audit committee and the Board of Directors recommend the ratification of appointment of M/s.Krishnakumar &Associates, Chartered Accountants as Auditors and to fix their remuneration. The members may ratify the appointment of M/s.Krishnakumar & Associates, Chartered Accountants, as the Statutory Auditors of the Company for the financial year 2015-16. The notes on Financial Statement referred to in the Auditor's Report are Self-explanatory. The Auditors' Report does not contain any qualification, reservation or adverse remark except with regard to providing for gratuity. Your Directors are of the opinion that provision for Gratuity in not required as there is no staff now. Further there is no liability for gratuity as on date. Our company will start providing for gratuity on the basis of acturial valuation as and when the liability arises. SECRETARIALAUDITOR The Board has appointed Mr.V.S.Sowrirajan and Associates, Company Secretary in Practice, to conduct Secretarial Audit for the Financial Year 2014 - 2015. The Secretarial Audit Report for the Financial Year 2014 - 2015 is attached as Annexure -2 to this report. Certain observations made in the Secretarial Audit Report with regard to non filing of certain forms which were mainly due to inadvertence and filed subsequently. However, the company would ensure in future that all the provisions are complied to the fullest extent. The company is in the process of selecting suitable candidates for the post of Chief Financial Officer and Company Secretary and will comply with the requirements of Section 203 of the Companies Act, 2013 PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013 There were no loans, guarantees or investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review and hence the said provision is not applicable. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES There were no contracts and arrangements entered with related parties falling within the purview of Section 188 of the Companies Act, 2013 during the year under review and hence the reporting under said provision is not applicable. DIVIDEND AND TRANSFER TO RESERVES IN TERMS OF SECTION 134 (3) (J) OF THE COMPANIES ACT, 2013 No Dividend was declared for the current financial year in view of loss. For the financial year ended 31 st March, 2015, the Company has not proposed to carry any amount to General Reserve Account. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT Your Directors report under Section 134(3)(l) of the Companies Act, 2013 that there have been no material changes and /or commitments incurred in the period from 31st March 2015 till the date of drafting of this Directors' Report, which have material effect on the Financial position of the Company. CHANGE OF NATURE OF BUSINESS, IF ANY There was no change in the nature of business of the Company during the year ended 31 st March, 2015 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO Your Company does not carry on any manufacturing activity and accordingly the provision to furnish information as per Section 134 of the Companies Act, 2013, read with Rule 8(3) of the Companies (Accounts) Rules 2014, particulars relating to Conservation of energy, Research and Development and Technology Absorption is not applicable. There were no foreign exchange earnings and outgo during the period under report. CORPORATE SOCIAL RESPONSIBILITY The Company does not meet the criteria laid down in Section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility Policy) Rules, 2014 hence there is no requirement of constituting Corporate Social Responsibility Committee. BOARD EVALUATION Pursuant to the provisions of Companies Act, 2013 and Clause 49 of the listing agreement, Independent Directors at their meeting without the participation of the Non-independent directors and management, considered and evaluated the Board's performance and other non-independent directors. SUBSIDIARIES/JOINT VENTURES/ASSOCIATE COMPANY The Company does not have any Subsidiary, Joint Ventures or Associate Company. Hence the requirement of presenting the consolidated financial statements in Annual Report is not applicable. DEPOSITS FROM PUBLIC During the year under review, your company did not accept any deposits within the meaning of provisions of Chapter V Acceptance of Deposits by the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014. INTERNAL FINANCIAL CONTROLS The details of the Internal Control system and their adequacy are provided in the Management Discussion and Analysis Report which forms part of this report AUDIT COMMITTEE The details pertaining to composition of audit committee are included in the Corporate Governance Report which is attached to this report. VIGIL MECHANISM/WHISTLE BLOWER POLICY The Company has established Vigil Mechanism / Whist Blower policy for Directors and employees to report their genuine concern. Your company hereby affirms that no complaints were received during the year. PARTICULARS OF EMPLOYEES PURSUANT TO SECTION 197(12) AND THE RELEVANT RULES Details pursuant to Section 197(12) of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 forms part of this report and are annexed herewith as Annexure -4 No employees of the company drawing remuneration in excess of the limit specified under Rule.5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 CORPORATE GOVERANCE Pursuant to Clause 49 of Listing Agreement) Pursuant to Securities and Exchange Board of India's Circular No.CIR/CFD/POLICY CELL/7/2014 dated September 15,2014, the Clause 49 of the Listing Agreement shall be applicable to all companies whose equity shares are listed on a recognized stock exchange. However, compliance with the provisions of Clause 49 shall not be mandatory, for the time being, in respect of Companies having paid up equity share capital not exceeding Rs.10 crore and Net Worth not exceeding Rs.25 crore, as on the last day of the previous financial year. However in line with Clause 49 of the listing agreement with Mumbai Stock Exchange (BSE Ltd) the Company is regular in complying with the mandatory requirements of the Corporate Governance. The report on Corporate Governance as stipulated under the Listing Agreement forms an integral part of this report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance is attached to this report. PERFORMANCE EVALUATION OF INDEPENDENT DIRECTORS: The Board constantly evaluates the contribution of the members and periodically updates with the shareholders about their reappointment in consistent with applicable laws. One of the key functions of the Board is to monitor and review the Board evaluation framework. The evaluation criteria for performance evaluation of independent directors has been laid down by the Nomination Committee and the same is annexed to the Annual Report. FAMILIARISATION PROGRAMMES At the time of their appointment, the Independent Directors are apprised of their role, duties and responsibilities in the Company. A detailed letter of appointment is also issued which set-outs the expectations of the Company, the rights, powers and liabilities of the Independent Directors and the policies of the Company to be adhered by them. Periodic presentations are made to the Independent Directors on the financial and operational performance of the Company, strategy and business plan, significant process improvements and material business developments among others. The Independent Directors are also regularly updated and informed about material regulatory and statutory developments affecting the Company. SIGNIFICANT OR MATERIAL ORDERS PASSED BY REGULATORS / COURTS During the year under review, there were no significant or material orders passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future. APPRECIATIONS AND ACKNOWLEDGMENTS Your Directors would like to express their sincere appreciation for the assistance and co-operation received from all the stakeholders during the year under review. By order of the Board of Directors For DUGAR HOUSING DEVELOPMENTS LIMITED Sd/- N.Tarachand Dugar Director (DIN-01740608) Sd/- T.Padam Dugar Whole-time Director (DIN-01735878) Place: Chennai Date :31.08.2015 |