DIRECTORS' REPORT To, The Members Subway Finance and Investment Co. Ltd. Your Directors take immense pleasure in presenting their Annual Report on the business and operations of the Company and statement of accounts for the year ended 31st March, 2015. Overview of Company's Financial Performance During the year under review, Income from Sales and Services was Rs. 1 7,06,201 /- against Rs 1 6 , 1 8 , 5 5 4/- in the previous year. The Company has earned a net profit of Rs. 8, 30, 737/- in the current financial year against the net profit of Rs. 9,47, 337/- in the previous financial year. Subsidiaries, Associate and Joint venture Companies As on March 31, 2015, according to Companies Act, 2013 and rules made there under the Company does not have any Subsidiary Company, Associate Company and joint venture Company. Transfer to reserves During the financial year, the Company has transfer Rs.1, 56,897/- to the Statutory Reserve maintained under Section 45 IC of the RBI Act, 1934. Particulars of loans, guarantees or investments under Section 186 The Company is Non -Banking Financial Company. Hence, particulars of details of loans, guarantee, security or investments covered under Section 186 of the Companies Act, 2013 which is required to furnished are not applicable to the Company. Although particulars of loans, guarantees and investments provided during the financial year under review has been furnished in Notes to Accounts which forms part of the financials of the Company. Dividend The company has not declared any dividend during the current year. Change in the nature of business There was no change in the nature of business of the Company during the financial year. Public Deposits During the financial year 2014-15, your Company has not accepted any deposit within the meaning of Sections 73 and 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014. Directors and Key Managerial Personnel The Board of your Company consists of seven Directors and CFO on the date of this report as follows: All the Directors have rich experience and specialized knowledge in various areas of relevance to the Company. The Company is immensely benefited by the range of experience and skills that the Directors bring to the Board. The composition of the Board is as per the Companies Act, 2013 and the Listing Agreement. Mr. Mayur Shah, Director (holding DIN: 01227368), retires at the ensuing Annual General Meeting (AGM) and being eligible offers himself for re-appointment. The Board of Directors recommends the re-appointment of Mr. Mayur Shah as a Director of the Company. The detailed profile of Mr. Mayur Shah, recommended for re-appointment is mentioned in the Notice for the AGM. A) Changes in Directors and Key Managerial Personnel during the year 2014 - 2015 During the year under review, Ms. Janaki Shah (DIN: 06906873) and Mr. Sandeep Padmakant Parikh (DIN: 00022365) were appointed as Additional Directors on the Board in its meeting held on 22nd July, 2014 with immediate effect. Further at the AGM held on 30th September, 2014, Mr. Sandeep Padmakant Parikh (DIN: 00022365), Mr. Ashok Narottam Tanna (DIN: 01584634) and Mr. Dilip Madhubhai Karelia (DIN: 03411839) were appointed as Independent Directors on the Board pursuant to Section 149,150,152 and other applicable provisions of the Companies Act, 2013, for a period of 5 years to hold office upto 31st March, 2019 During the year under review, Mr. Jayesh Amulakh Mehta and Mr. Amulakh Bhupatray Mehta ceased to be a member of the Board on account of resignation from the Directorship of the Company with effect from 7th August, 2014. Further, Mr. Bhupendra Ratilal Kadhi was appointed as the Chief Financial Officer of the Company with effect from 1st April, 2014 and thereby was recorded as the Key Managerial Persons of the Company by the Board. B) Woman Director In terms of the provisions of Section 149 of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Company shall have at least one Woman Director on the Board. Your Company has Ms. Janaki Shah, as Woman Director on the Board of the Company. C) Declaration by Independent Director(s) and re-appointment, if any The Company has three Independent Directors on the Board. The Company has received necessary declaration from each Independent Director under Section 149 (7) of the Companies Act, 2013, that the Independent Directors of the Company meet the criteria for their independence laid down in Section 149 (6) of the Companies Act, 2013. D) Policy on Directors' appointment and remuneration Policy for Selection and Appointment of Directors and their Remuneration including criteria for determining qualifications, positive attributes, independence of a director and other matters under Sub-section (3) of Section 178 of the Companies Act, 2013, recommended by the Nomination and Remuneration Committee and adopted by the Board, is given in 'Annexure - E' in the Corporate Governance Report forming part of this report. E) Board Evaluation Clause 49 of the Listing Agreement mandates that the Board shall monitor and review the Board evaluation framework. The Companies Act, 2013 states that a formal annual evaluation needs to be made by the Board of its own performance and that of its committees and individual directors. Schedule IV of the Companies Act, 2013 states that the performance evaluation of Independent Directors shall be done by the entire Board of Directors, excluding the director being evaluated The evaluation of all the directors and the Board as a whole was conducted based on the criteria and framework adopted by the Board. The Board found its members' performance satisfactory. The evaluation process has been explained in the corporate governance report Risk Management: The details of the risk management framework adopted and implemented by the Company are given in the Corporate Governance Report which may be taken as forming part of this Report. Share Capital The Company had not issued any equity shares either with or without differential rights during the financial year under review and hence, the disclosure requirements under Rule 4 (4) and Rule 16 (4) of the Companies (Share Capital and Debentures) Rules, 2014 is not applicable. Significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future During the financial year, there were no such orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future. Adequacy of Internal Financial Control The Board has adopted the policies and procedures for ensuing the orderly and efficient conduct of its business, including adherence to the Company's policies, the safeguarding the assets, the prevention and detention of frauds and errors, the accuracy and completeness of the accounting records, and timely preparation of reliable financial disclosure. Establishment of Vigil Mechanism The Company has established and adopted Vigil Mechanism and the policy thereof for directors and employees of the Company in accordance with the provisions of Companies Act, 2013 as well as listing agreement. During the year under review, no personnel of the Company approached the Audit Committee on any issue falling under the said policy. The vigil mechanism policy is available on the website www. sadgurubuilders.com Particulars of remuneration to employees During the financial year 2014-15, no remuneration was paid to any of the directors of the Company. Auditors a) Statutory Auditors During the financial year under review i.e. 2014-15, M/s. V.C.Vyas & Associates, Chartered Accountants, was appointed as the Statutory Auditor's of the Company at the Extra- Ordinary General Meeting held on 5th May, 2014. Their appointment was also approved at the Annual General Meeting of the Company held on 30th September, 2014. However in due course of time, M/s. V. C. Vyas & Associates, Chartered Accountants, resigned from the position of Statutory Auditors due to unavoidable circumstances, resulting into a casual vacancy in the office of Statutory Auditors of the company. In order to fill the casual vacancy caused by the resignation of M/s. V. C. Vyas & Associates, Chartered Accountants., your Directors appointed M/s. Priya Choudhary & Associates, Chartered Accountants, as the Statutory Auditors of the Company at the Extra- Ordinary General Meeting held on 9th December, 2014. M/s. Priya Choudhary & Associates, Chartered Accountants, (Registration No. 011506C) Chartered Accountants, Statutory Auditors hold office up to the conclusion of the forthcoming Annual General Meeting and being eligible, offer themselves for re-appointment. The Company has received letter from them giving their consent to act as Auditors of the Company and stating that their re-appointment, if made, would be within the prescribed limits under Section 139 of the Companies Act, 2013. Your Directors recommend their appointment as Statutory Auditors to hold office from the conclusion of the forthcoming Annual General Meeting till the conclusion of the next Annual General Meeting. b) Secretarial Auditors M/s Makarand M. Joshi & Co., Practicing Company Secretaries, was appointed to conduct the Secretarial Audit of the Company for the financial year 2014-2015, as required under Section 204 of the Companies Act, 2013 and Rules thereunder. The secretarial audit report for financial year 2014-2015 forms part of the Directors Report as 'Annexure D' to the Board's report. c) Internal Auditors M/s. Kadhi & Associates, Chartered Accountant, were appointed the Internal Auditors of the Company for the financial year 2014-15. Based on the recommendation of the Audit Committee of the Company, the Board of Directors has appointed M/s. Kadhi & Associates, Chartered Accountant as the Internal Auditors of the Company for the financial year 2015-16. Management Discussion and Analysis The Management Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement, is given separately in 'Annexure A' which may be taken as forming part of this Report Corporate Social Responsibility: The Company is not falling in any criteria as mentioned in Section 135 of the Act read with Companies (Corporate Social Responsibility Policy) Rules, 2014, the Act. Hence, provision of CSR is not applicable to the Company. Corporate Governance Report As required by clause 49 of the Listing Agreement with the Stock Exchange (s), a report on Corporate Governance and a certificate confirming compliance with requirement of Corporate Governance forms part of this Annual Report. 'Annexure -B' Extract of Annual Return In accordance with Section 134(3)(a) of the Companies Act, 2013, an extract of the Annual return in the prescribed format is annexed herewith as 'Annexure C' to the Board's report. Explanations by the Board on qualification, reservation or adverse remark or disclaimer made by the • Auditors in their report: There were no qualification, reservation, disclaimer and adverse remarks made by the Auditors of the Company in their audit report. Company secretary in practice in his secretarial audit report: The qualification/Observation given by the Company secretary in practice in his secretarial audit report for the financial year 2014-2015 is as follows: _Observation_ The Company has not appointed Company Secretary in whole time employment of the Company which is required to be appointed as per Section 203 of the Companies Act, 2013 and rules made thereunder. Directors Reply to the observation The Company is in the process of finding appropriate candidate for the position of Company secretary and it will ensure to appoint such person at the earliest in ensuing financial year. Directors' Responsibility Statement Pursuant to the requirement of Section 134(3)(c) of the Companies Act 2013, with respect to the Directors' Responsibility Statement, it is hereby confirmed: a) that in the preparation of the accounts for the financial year ended on 31st March, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures, b) that the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2015 and of the profit/ loss of the Company for the year ended on that date; c) that the Directors had 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; d) that the Directors had prepared the accounts for the financial year ended on 31st March, 2015 on a 'going concern' basis. e) that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively. f) that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively. Particulars of contracts or arrangements made with related parties There were no new contract or arrangements entered into by the Company with related parties referred to in sub-section (1) of Section 188 of the Companies Act 2013 during the financial year 2014-2015. Hence, particulars of related party contracts or arrangements in form AOC - 2 is not applicable Material changes and commitments affecting financial position between the end of the financial year and date of report There are no material changes and commitments affecting financial position between the end of the financial year and date of report. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings & Outgo A. Conservation of Energy: Steps taken or impact on conservation of energy Steps taken by the company for utilizing alternate sources of energy_ Capital investment on energy conservation equipments Taking in to consideration business of the Company, The Company has not spent any substantial amount on Conservation of Energy to be disclosed here._ B. Technology Absorption • Efforts made towards technology absorption: Considering the nature of activities of the Company, there is no requirement with regard to technology absorption. Benefits derived as a result of the above efforts: Since the Company did make any technology absorption there was no benefits derived from the same. • In case of imported technology (imported during the last 3 years reckoned from the beginning of the financial year): no new technology has been imported during the year. (a) the details of technology imported: Not Applicable (b) the year of import: Not Applicable (c) whether the technology been fully absorbed: Not Applicable (d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof: Not Applicable • Expenditure Incurred on Research and Development: The Company has not spend any money on Research and Development during the F.Y.2014-15. C. Foreign exchange earnings and outgo There was no Foreign Currency earning & expenditure during the year. Acknowledgment: Your Directors would like to express their grateful appreciation for the assistance, support and co-operation received from the Financial Institutions, Banks, Government Authorities and Shareholders during the year under review. Your Directors would also like to take this opportunity to express their appreciation to the employees at all levels for their enormous personal efforts as well as collective contribution to the Company's growth. For and on behalf of the Board of Directors Subway Finance and Investment Company Limited Kalpesh Shah DIN:01227205 Managing Director JVPD, Road No 12, Mahalaxmi, BLDG, Plot No S/6, Kapol Society, Vile Parle (West), Mumbai - 400056 Suketu Shah DIN: 01227301 Director 601, Manju Castle, Church Road, Off St.Xaviers Road, Vile Parle (W), Mumbai - 400056 Place: Mumbai Date: 31/08/2015 |