AFFLUENCE

Directors’ Report for the Financial Year Ended March 31, 2014

To

The Shareholders,

Your Directors have pleasure in presenting the Thirty First Annual Report along with the Audited Statements of Accounts of the Company for the year ended 31st March 2014.

1. FINANCIAL HIGHLIGHTS

2. DIVIDEND

In view of the loss suffered by your company during the year, the Director expresses their inability to declare Dividend for the year 2013-14.

3. DIRECTORS

·         In accordance with the Articles of Association and the provisions of the Section 152 (6) (e) of Companies Act, 2013, Mr. Ashwin Sheth retire by rotation at the ensuing Annual General Meeting and being eligible, offer himself for re-appointment.

·         The Company has pursuant to provision of Section 160(1) of the Companies Act, 2013 received notice in writing from Member proposing his candidature for the appointment of Mr. Sharad N. Doshi and Mrs. Nalini R. Bajaria as an independent Director.

4. AUDITORS AND AUDITOR’S REPORT

·         M/s. M. B. Agrawal & Co., Chartered Accountants, Mumbai, Statutory Auditors of the Company hold office till the conclusion of the forthcoming Annual General Meeting of the Company and are eligible for re-appointment.

·         Pursuant to the provisions of Section 139 of the Companies Act, 2013 and Rules framed thereunder, it is proposed to appoint M/s. M. B. AGRAWAL & CO., Chartered Accountants, Mumbai, as Statutory Auditors of the Company from the conclusion of forthcoming Annual General Meeting till conclusion of Annual General Meeting to be in the year 2017, subject to ratification of their appointment at every Annual General Meeting.

·         The Company has received letter from M/s. M. B. Agrawal & Co. to the effect that their re-appointment if made would be pursuant to provisions of Section 139(1) of the Companies Act, 2013 and that they are not disqualified within the meaning of Section 141 of the Companies Act, 2013 read with Rule 4(1) of the Companies (Audit and Auditors) Rules, 2014.

·         The Notes on Financial Statements referred to in the Auditors’ Report are self explanatory and do not call for any further comments.

5. COMPLIANCE CERTIFICATE

In terms of the provisions of Section 383A of the Companies Act, 1956, your Company has obtained Compliance Certificate from Practicing Company Secretary and which is forming part of Directors’ Report.6. COMMITTEES OF DIRECTORS

A.      Reconstitution of Audit Committee:

During the year under review, the Audit Committee was reconstituted at Meeting of the Board of Directors of the Company held on 6th September, 2014 to align with the Companies Act, 2013 and amended provisions of Clause 49 of listing Agreement. The Committee comprises of Mr. Sharad N. Doshi as Chairman, Mr. Ashwin N. Sheth and Mrs. Nalini R. Bajaria as members.

B.      Stakeholders’ Relationship Committee (Formerly known as Investors’ Grievance cum Share Transfer Committee):

During the year under review, the Investors’ Grievance cum Share Transfer Committee was reconstituted at Meeting of the Board of Directors of the Company held on 6th September, 2014 to align with the Companies Act, 2013 and amended provisions of Clause 49 of listing Agreement and so renamed as Stakeholders Relationship Committee. The Committee comprises of Mr. Sharad N. Doshi as Chairman, Mrs. Nalini R. Bajaria, Mr. Ashwin N. Sheth and Mr. Vallabh N. Sheth as members.

C.      Nomination, Remuneration & Compensation Committee (Formerly known as Remuneration Committee) :

During the year under review, the Remuneration Committee was reconstituted at Meeting of the Board of Directors of the Company held on 6th September, 2014 to align with the Companies Act, 2013 and amended provisions of Clause 49 of listing Agreement and so renamed as Nomination, Remuneration & Compensation Committee. The Committee comprises of Mr. Sharad N. Doshi as Chairman, Mrs. Nalini R. Bajaria, Mr. Ashwin N. Sheth and Mr. Jitendra N. Sheth as members.7. PUBLIC DEPOSITS

The Company has not accepted Public Deposits within the purview of section 58A of the Companies Act, 1956 during the year under review.8. LISTING OF EQUITY SHARES

The equity shares of your Company are listed on the BSE Limited. The Listing fee for the year 2014-15 has already been paid.9. FINANCIAL CONDITION AND RESULT OF OPERATIONS

Management Discussion and Analysis of Financial Condition and result of Operation of the Company for the year under review, as stipulated under clause 49 of Listing Agreement with the Stock Exchanges, is given as a separate statement in this Annual Report.10. DIRECTORS’ RESPONSIBILITY STATEMENT

The MCA has vide its General Circular No. 08/2014 dated April 4, 2014, clarified that the financial statements (and documents required to be attached thereto), auditors report and Board Report in respect of financial years that commenced earlier than April 1, 2014 shall be governed by the relevant provisions/Schedules/Rules of the Companies Act, 1956. In view of this, the following information has been provided as per the provisions of the Companies Act, 1956.

Pursuant to the requirements under section 217 (2AA) of the Companies Act, 1956, your Directors state that:-

1)         In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanations relating to material departures, if any.

2)         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 the end of the financial year and on the profit for the year under review.

3)         The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the 1956 Act and for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4)         The Directors have prepared the accounts for the financial year ended 31st March 2014 on a “going concern” basis.11. Cash Flow Statement & Consolidated Financial Accounts

The Cash flow Statement & Consolidated Financial Statements pursuant to clause 32 of the Listing Agreement entered into with Bombay Stock exchange, prepared in accordance with the applicable accounting standards, as prescribed by the Institute of Chartered accountants of India is attached as enclosures to the company’s financial Statements.12. Subsidiary Company

As at March 31, 2014, your Company had one subsidiary i.e. Sheth Developers and Realtors (India) Limited. Pursuant to the General Circular No. 2/2011 dated February 8, 2011 issued by Ministry of Corporate Affairs, Government of India, the Board of Directors of your company have given their consent for not attaching the accounts of the subsidiary of your company alongwith the Annual Report of your company. In line with the above circular and as per accounts of the subsidiary of your company along with Auditors Report have been annexed to this Annual Report.

The Company shall provide the copy of the annual accounts of its subsidiary company and the related information to the members of the Company and also to the members of the subsidiary company on their request. The annual accounts of the subsidiary company will also be kept open for inspection by any members at the Registered Office of the Company and also at the registered office of the respective subsidiary company during business hours.13. DISCLOSURES AS PER SECTION 217(1) (E) OF THE COMPANIES ACT, 1956

A.      Conservation of Energy & Technology Absorption

The Company did not carry out any business activities warranting conservation of energy and technology absorption in accordance with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988.

B.      Foreign Exchange Earnings and Outgo

During the year under review the company had not earned any foreign exchange nor incurred any outflows in foreign exchange.14. PARTICULARS OF EMPLOYEES

There are no employees whose particulars are required to be shown in terms of provisions of Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended.15. CORPORATE GOVERNANCE

As required by Clause 49 of the Listing Agreements entered into by your Company with the BSE Limited, a detailed report on Corporate Governance together with a report on Management Discussion & Analysis is included in the Annual Report. The Auditors have certified the Company’s compliance with the requirement Corporate Governance in terms of Existing Clause 49 and the same is annexed to the report on Corporate Governance.16. ACKNOWLEDGEMENT

Your Directors wish to place on record their appreciation and sincere thanks to the State Governments, Government agencies, Banks & Financial Institutions, customers, shareholders, vendors and other related organizations, who through their continued support and co-operation have helped, as partners in your Company’s progress. Your Directors, also acknowledge the hard work, dedication and commitment of the employees.

By Order of the Board of Directors

Place: Mumbai                                                                                

Date: 6th September, 2014

                                                                                                                Ashwin Sheth

DIN: 00002053

Chairman & Non-Executive Director