DIRECTOR'S REPORT Dear Shareholders Your Directors take pleasure in presenting the 23rd Annual Report together with the Audited Annual Accounts of your Company for the year ended 31st March, 2015 together with the Auditor's Report thereon. 1. Financial Performance 2.Dividend Your directors do not recommend any dividend for the year ended 31st March, 2015 3.Management Discussion & Analysis Report As required under Clause 49 of the Listing Agreement entered into with the Stock Exchanges and Circular/ Notifications/ Directions issued by Reserve Bank of India from time to time, the Management Discussion and Analysis for the year under review is presented in a separate section forming part of the Annual Report. 4.Corporate Governance A separate report on Corporate Governance is provided together with certificate from the Auditors of the Company confirming compliance to the conditions of Corporate Governance as stipulated under Clause 49 of the Equity Listing Agreement and is forming part of this Annual Report. 5.RBI Guidelines As a Non Deposit accepting Non-Banking Finance Company, your Company always aims to operate in compliance with applicable RBI laws and regulations and employs its best efforts towards achieving the same. 6.Subsidiaries Companies, Joint Ventures and Associates The Company has no subsidiary Company. The company has one Associate company, Jan Uddhaar Finance Private Limited, which was incorporated on 06.08.2015. 7.Number of Meetings of the Board The Board met 10 times in financial year 2014-15 viz., 23rd April 2014, 25th April 2014, 29th May 2014, 14th August 2014, 26th September 2014, 29th October 2014, 9th January 2015, 30th January 2015, 14th February 2015 and 30th March, 2015. The maximum interval between any two meetings did not exceed 120 days. 8.Committees of the Board During the year, in accordance with the Companies Act, 2013 and Clause 49 of Listing Agreement, the Board constituted a Corporate Social Responsibility Committee. The Committees of the Board in place are as follows: •Audit Committee •Nomination and Remuneration Committee •Stakeholders' Relationship Committee •Investor Relations & Share Transfer Committee •Corporate Social Responsibility Committee Details of the said Committees along with their charters, composition and meetings held during the year, are provided in the "Report on Corporate Governance", a part of this Annual Report. 9.Details of Directors or KMP appointed/ resigned during the year Pursuant to the requirements of the listing agreement and applicable rules of Companies Act 2013, Ms. Anjna (DIN: 07143461) was appointed as an Additional Director (Independent) by the Board of Directors with effect from 30.03.2015. No other KMP/Director was appointed or resigned during the year. 10.Board's Independence The definition of 'Independence' of Directors is derived from Clause 49 of the Listing Agreement with Stock Exchange and Section 149(6) of the Companies Act, 2013. Based on the confirmation/ disclosures received from the Directors and on evaluation of the relationships disclosed, the following Non-Executive Directors are Independent in terms of Clause 49 of the Listing Agreement and Section 149(6) of the Companies Act, 2013:1. Mr. Kapil Aggarwal (DIN: 00032225) 2.Mr. Anirudha Kumar (DIN: 00084495) 3.Ms. Anjna (DIN: 07143461) 11.Director's Responsibility Statement In pursuance to applicable provisions of the Companies Act, with respect to Director's Responsibility Statement, your directors hereby state and confirm: a.that in the preparation of the annual accounts for the financial year ended 31st March 2015, the applicable accounting standards has been followed b.that the Directors has selected such accounting policies and applied them consistently and made judgment and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profits or loss of the company for the year under review c.that the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the company and for preventing and detecting frauds and other irregularities d.that the Directors had prepared the annual accounts for the financial year ending 31st March 2015 on a going concern basis. e.the Directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and f.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. 12.Company's Policy on Directors' Appointment and Remuneration & Evaluation Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, Policy on Nomination and Remuneration of Directors, Key Managerial Personnel and other employees has been formulated including criteria for determining qualifications, positive attributes, Independence of a Director and other matters as required under the said Act and Listing Agreement. The evaluation framework for assessing the performance of Directors comprises of the following key areas: •Expertise; •Objectivity and Independence; •Guidance and support in context of life stage of the Company; •Understanding of the Company's business; •Understanding and commitment to duties and responsibilities; •Willingness to devote the time needed for effective contribution to Company; •Participation in discussions in effective and constructive manner; •Responsiveness in approach; •Ability to encourage and motivate the Management for continued performance and success; The evaluation involves Self-Evaluation by the Board Member and subsequently assessment by the Board of Directors. A member of the Board will not participate in the discussion of his/ her evaluation. 13.Particulars of Loans, Guarantees or Investments Details of loans, guarantees and investments are given in the notes to the Financial Statements. 14.Particulars of Contracts or Arrangements with Related Parties referred to in Section 188 During and subsequent to the year under review, the contracts or arrangements with related parties have been on arms length and in ordinary course of business and they were not material in nature. Accordingly, the particulars of the transactions as prescribed in Form AOC-2 of the rules prescribed under chapter IX relating to Accounts of Companies under the Companies Act, 2013 are not required to be disclosed as they are not applicable. 15.Statutory Auditors & their Report M/s. R. Mahajan & Associates, Chartered Accountants were appointed as Statutory Auditors of your Company at its 22nd Annual General Meeting (AGM) held on 30th September, 2014, from the conclusion of the said AGM till conclusion of Twenty Third Annual General Meeting being held on 30th September, 2015. Accordingly, the appointment M/s. R. Mahajan & Associates, as the Statutory Auditor of the Company is placed for ratification by the shareholders. The Auditor's Report does not contain any qualification, reservation or adverse remark. 16.Secretarial Auditors & their Report Pursuant to the provisions of Section 204 of the Companies Act, 2013 and Rules made thereunder, the Company had appointed Mr. Sanjay Kumar, Practicing Company Secretary, to undertake the Secretarial Audit of the Company for the financial year 2014-15. The Secretarial Audit Report for Financial Year 2014-15 has been appended as Annexure-I to this Report. 17.Extract of Annual Return The details forming part of the extract of the Annual Return in form MGT-9 is annexed herewith as Annexure-II to this Director's Report. 18.Corporate Social Responsibility (CSR) The Board of Directors of the company, during the year under review, had constituted the Corporate Social Responsibility (CSR) Committee in accordance with Section 135 of Companies Act, 2013 read with rules formulated therein. The Company pursuant to the recommendation of the CSR Committee had adopted a detailed policy on Corporate Social Responsibility and also discussed and identified the core areas in which the CSR activities was proposed to be carried out in the CSR Committee Meetings from time to time. The CSR Policy of the Company has been annexed as Annexure-III to this Report. 19.The state of the Company's affairs During the year under review the performance of the company has been satisfactory, even despite the challenges in the operating environment. The company continues to run a zero-default loan book. Though credit growth is yet to pick up, going ahead the company sees ample opportunities in the secured lending segment and is looking to scale up its loan book in the years to come. 20.The amounts, if any, which the Company proposes to carry to any reserves During the year under review, the company has transferred an amount of Rs.1.59 Crores from the Profit & Loss Account of the company to the Statutory Reserve created u/s 45 IC of the Reserve Bank of India Act, 1934. 21.Change In the Nature of Business, if any There was no change in the nature of the business of the Company during the Financial Year 2014-15. 22.Meeting of Independent Directors During the year under review, the Independent directors in their meeting held on 31.03.2015 reviewed the performance of Non-Independent Directors, the Board as a whole and the Chairperson of the company; and also assessed the quality, quantity and timelines of flow of information between the company management and the Board in line with the requirement of Clause 49 of the listing agreement read with applicable provisions of Schedule IV of the Companies Act, 2013. 23.Remuneration to Managing Director Mr. Rohit Gupta, Managing Director of the company has drawn Rs.90,00,000/- (Rupees ninety lacs only) as salary during the year. The company shall continue to ensure compliance with all the applicable rules and regulations in this regard. The revision in terms of the remuneration of Mr. Rohit Gupta is being placed before the shareholders for their approval at the ensuing Annual General Meeting of the Company. 24.Ratio of the remuneration of each director to the median employee's remuneration. The remuneration is paid by the company to Mr. Rohit Gupta, Managing Director of the company. No other director was paid any remuneration during the year. The ratio of the remuneration of Mr. Rohit Gupta to the median employee's remuneration is as follows: 25.Vigil Mechanism Your Company has established a 'Whistle Blower Policy and Vigil Mechanism' for directors and employees to report to the appropriate authorities concerns about unethical behavior, actual or suspected, fraud or violation of the Company's code of Conduct. The said policy has been uploaded on the website of the Company. 26.Particulars of Energy Conservation, Technology Absorption, expenditure on research and development, foreign exchange inflow/outflow, etc. The requirements of disclosure with regard to Conservation of Energy in terms of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014, are not applicable to the Company since it doesn't own any manufacturing facility. 27.Risk Management Policy And Internal Control The Company has adopted a Risk Management Policy to identify, assess, monitor and mitigate various risks to its key business objectives. Major risks, if any identified, are systematically addressed through corrective measures on a continuing basis. The Company's internal control systems are commensurate with the nature of its business and the size and complexity. 28. Acknowledgement Your directors take this opportunity to place their sincere appreciation for significant contribution made by all the employees for their dedication, hard work and commitment towards the success and growth of the Company. The directors also place their thanks to the company's bankers, depositories, Government and all the regulatory authorities including SEBI, Stock Exchanges, Ministry of Corporate Affairs, Registrar of Companies and Reserve Bank of India. And last but not the least we put our sincere thanks to the shareholders for the confidence reposed by them in the company and looking forward to have the same support in the coming time. For on & behalf of the Board Rohit Gupta Managing Director & CFO (DIN: 00045077) Ashok Kumar Kathuria Director(DIN:01010305) Date: 22nd August, 2015 Place: New Delhi |