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Directors Report of Aftek Ltd.

Mar 31, 2015

The Directors are pleased to present their 28th Annual Report together with the Audited Statement of Accounts for the year ended 31st March, 2015.Members may kindly note that vide letter dated 10th September, 2015 received from Government of India, Ministry of Corporate Affairs, Office of the Registrar of Companies, Maharashtra, the Company has obtained extension of three months for holding the Annual General Meeting.

FINANCIAL PERFORMANCE

AMOUNT(Rs,INLACS)

PARTICULARS 31/03/2015 31/03/2014

TURNOVER 5260 7575

PROFITBEFORE DEPRECIATION 3653 5868

LESS DESPRECIATION 5599 7756

PROFIT/(LOSS) BEFORE TAX (1946) (1887)

LESS: PROVISION FORTAXATION/ REVERSALOF DEFERREDTAX NIL (54)

PROFITAFTERTAX (1946) (1833)

TRANSFERTOGENERAL RESERVE NIL NIL

DIVIDEND:

In view of the loss incurred during the year, it has not been possible for your Directors to recommend any dividend for the year.

BUSINESS REVIEW & FUTURE PROSPECTS

Your company's performance during the year has been well bellow par. The financial restructuring and closure of banking with delays in getting the Defense vertical projects is largely responsible for this dismal performance. The below par turnover add with the dollar fluctuations and writing off certain bad debts the company's balance sheet carries a loss of Rs, 19.46 crores.

In order to inject funds from the investor your company needs to complete the financial restructuring and the closure of the banks. Your directors are confident that with the Indian economy now catching steam and the reforms viz GST process getting in place the economic environment is expected to improve making the investment climate better, also the further opening up of the Defense sector for FDI the "Make in India" would gather momentum largely benefiting company's like ours operating in this space.

As communicated during the last AGM your company is engaged in serious discussion with investors who have liked the indigenous product and manufacturing strategy now popularly known as "make in India", In Defense, smart city, smart home and Integrated Intelligent Transport. Keeping this in mind, the directors had proposed an enabling resolution to accommodate the new set of investors. In view of the above your Directors are actively pursuing the financial restructuring, closure of Bank Loans and injecting fresh funds through the prospective investors.

FINANCE

While the recovery of receivables continued to remain at a slow rate, your Company had to write off sizable amounts as bad debts during the year. While proposal for one time settlement of the dues of lending bankers has been on a positive track, the closure of loan accounts has been delayed in spite of Company's rigorous efforts for early settlement.

The 354 numbers of FCCBs, if converted into GDRs/equity shares at the conversion price of Rs, 13.76 would result into issuance of additional 1,12,10,428 numbers of equity shares of Rs, 02/-each.

DIRECTORATE

Pursuant to Sections 149, 152 and any other applicable provisions of the Companies Act, 2013, Miss Aditi Bhatt (DIN 07144131) is proposed to be appointed as Independent Directors to hold office for five consecutive years.

Brief resume of the Director proposed to be appointed/re-appointed, nature of her expertise in specific functional areas, names of the Companies in which she hold directorships and membership/Chairmanship of Committees of the Board, her shareholding in the Company and inter-se relationship with Directors, as stipulated under section 149(6) of the Companies Act, 2013 and Clause 49 of Listing Agreement entered into with the Stock Exchanges, are set out in the Notice forming part of the Annual Report.

The Board commends the resolution to the members for the respective appointment.

FIXED DEPOSITS

The Company has not accepted any Fixed Deposits from the Public.

AUDITORS

The present Statutory Auditors of the Company, M/s. GMJ & Co., Chartered Accountants, was appointed as the statutory Auditor of the company up to financial year 2018-19 subject to ratification at every year by the members.

The Company has received a letter as required under Section 141 of the Companies Act, 2013 from M/s. GMJ & Co., Chartered Accountants, confirming their eligibility and willingness to act as Statutory Auditors, if re-appointed. M/s. GMJ & Co., Chartered Accountants shall be appointed as Statutory Auditors of the Company to hold office for the reaming period from the conclusion of this Annual General Meeting until the conclusion of the fifth Annual General Meeting to examine and audit the accounts of the Company for the financial year 2015-16, 2016-17, 2017-18 and 2018-19 subject to ratification by the members of the Company at all the subsequent AGMs.

AUDITORS REPORT

The Auditors have made certain qualification to the financial statement. Their reports on relevant notes on accounts are self- explanatory and comments of the Board under section 134 of the companies Act, 2013 are self explanatory.

Auditor qualification and management reply

Point No. Auditors' qualifications Management reply

(i) Basis for qualified opinion

Note no.39 regarding, Management has not considered any

(i) In view of the on-going slowdown in the provision in respect of outstanding Debtors for a period more European and US Markets, there have than 12 months amounting to Rs. 22,398.36 Lacs which in our been delays in receivables.

opinion, as evidenced by the poor recovery made during the Considering the size and standing of year, are doubtful of recovery. Consequently, profit before tax is its debtors, the company has not made overstated by Rs. 22,398.36 Lacs. Further in our view there is any provision at this stage. The significant uncertainty as to ultimate collection of Debtors due Management is putting more efforts for to non-receipt from overseas debtors. Therefore we are further the recovery.

Unable to comment on recoverability of balance debtors amounting to Rs.4,995.58 Lacs

(ii) Note no.40 regarding, company has given certain capital (ii Bank has issued one time settlement advances and made some investments totaling to Rs.6975.20 (OTS), final stage of negotiations are Lacs towards the building under construction at Hinjewadi, Pune, going on. Completion of the same up to the year ended, 31-3-2010, thereafter there are no further necessary entries will be made to close developments/construction made. The said Plot of land is theses transactions.

mortgaged to Bank of India -Jersey Channel Islands against the term loan. However since the Company has made default in repayment of Principal and Interest thereon, Bank has demanded repayment total loan and taken the possession of the land along with the construction in progress. The bank has called for bids at a base price of Rs.1800.00 Lacs. There is no provision made towards the eventual loss on such auction, which is presently not ascertainable till such disposal. The bank has now agreed for an one time settlement (OTS) of outstanding for Rs.2600 lacs;

1. Emphasis of matter

Note no.34 b (ii) regarding Liability if any of the pending 1. Regarding Income-tax on completion of assessment under Income Tax, Sales tax (including interest, if Assessment for the F.Y. 2010-2011 any) which are presently not ascertainable around Rs.1.50 crores is due. Regarding Sales tax about Rs.10.00

2. Without qualifying our opinion, we draw attention to Note No.41 lacs . as the position has now improving regarding intangible Assets under development for various these are being cleared-off very soon. ongoing projects. Due to the delay in the projects, Intangible

2. These intangible assets acquired by the Assets under development for Rs.19910.32 Lacs are yet to be company for the ongoing projects. put to use as on the date of balance sheet. The company is of Some part of the same already put to the opinion that with the improved market conditions all the use balance will be early next year i.e. Assets under development will be profitably used by the April, 2016. company in the future projects

ANNEXURE TO THE INDEPENDENT AUDITORS' REPORT

(iv) In our opinion and according to the information and explanations (iv)Company is having internal audit control given to us, having regard to the explanation that the IPRs system to monitor usage of IRRS etc. purchased are of special nature and suitable alternative source The said Reports will be submitted to do not exist for obtaining comparable quotation, there exist an the Audit Committee every quarterly for adequate internal control system commensurate with its size taking necessary action.

and nature of its business with regards to purchase of inventory and fixed assets and with regards to the sale of goods and service. During the course of our audit, we have not observed any major weakness in such internal control system.

(vii) In respect of statutory dues:

(a) According to the information and explanations given to us the (a)As the position has now improving company is not regular in depositing undisputed statutory dues, these are being cleared-off very soon.

Employees State Insurance, Sales-tax, Wealth Tax, Service Tax

Custom Duty, Excise Duty, Cess and any other statutory dues with the appropriate authorities. Undisputed provident fund dues are not regularly deposited with the appropriate authorities. In respect of income tax, the Company is not regular in depositing those dues with the appropriate authorities and there have been significant delays in a large number of cases. Undisputed amounts payable in respect of above mentioned taxes which were outstanding, at the year-end for a period of more than six months from the date they became payable are as follows:

(ix) According to the information and explanations given to us the

(xi) Bank has agreed for one time settlement company has defaulted in repayment of dues to a bank the (OTS), the same is in final stage, expected details of the same as on 31st March, 2015 are as mentioned to close these issues on or before end of below. this current financial year i.e. March, 2016

AUDITORS' REPORT

CONSOLIDATED FINANCIAL STATEMENTS:

The Audited Consolidated Financial Statements of the Company for the financial year ended 31st March, 2015, prepared in accordance with the Companies Act, 2013 ("the Act.) and Accounting Standard (AS) - 21 on Consolidated Financial Statements is provided in the Annual Report.

SUBSIDIARY COMPANIES:

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing salient features of the financial statements of the subsidiary companies in Form AOC- 1 is Annexure –I in this Board's Report.

Pursuant to the provisions of Section 136 of the Companies Act, 2013, the financial statements of the Company, consolidated financial statements together with relevant documents and separate audited accounts in respect of subsidiaries, are available on the website of the Company.

MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT:

Management's Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing with Stock Exchange in India, is presented in a separate section forming part of the Annual Report.

CHANGE IN THE NATURE OF BUSINESS,IF ANY:

There was no change in the nature of business of the Company or any of its subsidiaries during the year.

FIXED DEPOSIT:

As on 31st March, 2015, the Company held no deposit in any form from anyone. There was no deposit held by the company as on 31st March, 2015, which was overdue or unclaimed by the depositors. For the present, the Board of Directors has resolved that not to accept any deposit from public.

MATERIAL CHANGES AND COMMITMENT,IFANY,AFFECTING THE FINANCIAL POSITION OF THE COMPANY:

During the year under review there were no material change and commitment affecting the financial position of the Company.

NUMBER OF MEETINGS OF THE BOARD:

The Board met 5 times during the financial year, the details of which are given in the Corporate Governance Report that forms part of this Annual Report. The intervening gap between any two meetings was within the period prescribed by the Companies Act, 2013.

DIRECTOR SAND KEY MANAGERIAL PERSONNEL:

The Companies Act, 2013 provides the appointment of Independent Directors. Pursuant to the provisions of Section 149 (4) of the Companies Act, 2013 provides that every listed company shall have at least one-third of the total number of directors as independent directors. The Board of the Company is already in compliance with aforesaid section.

As per the Section 149(10) of the Companies Act, 2013 provides that independent director shall hold office for a term of upto five consecutive years on the Board of the Company; and shall be eligible for re-appointment on passing a special resolution by the shareholders of the Company.

Further, according to the Section 149 (11) of the CompaniesAct, 2013, no independent director shall be eligible for appointment for more than two consecutive terms of five years. Sub-section (13) states that the provisions of retirement by rotation as defined in Sub-sections (6) and (7) of Section 152 of the Act shall not apply to such independent directors.

The Nomination and Remuneration Committee on 30/05/2015 has confirmed and ratified the appointment of Miss Aditi Bhatt as an Independent Director of the company for a period of five years starting from 30/05/2015 up to 29/05/2020 and who are not liable to retire by rotation. On the recommendation of the Nomination and Remuneration Committee, the Board seeks the ratification of the same from the members of the Company.

Further, at the time of appointment of an independent director, the Company issues a formal letter of appointment outlining his/her role, functions, duties and responsibilities as a director.

The format of the letter of appointment is available on our website, www.aftek.com

INDEPENDENT DIRECTORS DECLARATION:

The Company has received necessary declaration from each independent director under Section 149(7) of the Companies Act, 2013, that he/she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement.

The Independent Director under section 149(6) of the Companies Act, 2013 declared that:

1. She is not a promoter of the Company or its holding, subsidiary or associate company;

2. She is not related to promoters or directors in the company, its holding, subsidiary or associate company.

3. The independent Director have /had no pecuniary relationship with company, its holding, subsidiary or associate company , or their promoters, or directors, during the two immediately preceding financial years or during the current financial year;

4. None of the relatives of the Independent Director has or had pecuniary relationship or transaction with the company, its holding, subsidiary or associate company, or their promoters, or directors, amounting to two per cent. or more of its gross turnover or total income or fifty lakh rupees or such higher amount as may be prescribed, whichever is lower, during the two immediately preceding financial years or during the current financial year;

5. Independent Director, neither himself nor any of his relatives:

(i) holds or has held the position of a key managerial personnel or is or has been employee of the company or its holding, subsidiary or associate company in any of the three financial years immediately preceding the financial year in which he is proposed to be appointed;

(ii) is or has been an employee or proprietor or a partner, in any of the three financial years immediately preceding the financial year in which he is proposed to be appointed, of:

(A) a firm of auditors or company secretaries in practice or cost auditors of the company or its holding, subsidiary or associate company; or

(B) any legal or a consulting firm that has or had any transaction with the company, its holding, subsidiary or associate company amounting to ten percent. or more of the gross turnover of such firm;

(iii) Holds together with his relatives two percent. or more of the total voting power of the company; or

(iv) is a Chief Executive or Director, by whatever name called, of any nonprofit organization that receives twenty-five percent. or more of its receipts from the company, any of its promoters, directors or its holding, subsidiary or associate company or that holds two percent. or more of the total voting power of the company;

6. Independent Director possesses such qualifications as may be directed by the Board. The Company & the Independent Directors shall abide by the provisions specified in Schedule IV of the Companies Act, 2013.

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 should be done by the entire Board of Directors, excluded 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 approved the evaluation results as collated by the Nomination and Remuneration Committee.

PERFORMANCE OF THE BOARD AND COMMITTEES:

During the year under review, the performance of the Board & Committees and Individual Director(s) based on the below parameters was satisfactory:

(i) Most of the Directors attended the Board meeting;

(ii) The remunerations paid to executive Directors are strictly as per the company and industry policy.

(iii) The Independent Directors only received sitting fees.

(iv) The Independent Directors contributed a lot in the Board and committee deliberation and business and operation of the company and subsidiaries based on their experience and knowledge and Independent views.

(v) The Credit Policy, Loan Policy and compliances were reviewed periodically;

(vi) Risk Management Policy was implemented at all critical levels and monitored by the Internal Audit team who places report with the Board and Audit committee.

MEETING OF INDEPENDENT DIRECTORS:

Pursuant of the provision of Section 149 (8) of the Companies Act, 2013 read with Schedule IV and Clause 49 of the Listing Agreement, the Independent Directors of the Company held their meeting on 02nd February, 2015, reviewed the performance of non- independent directors and the Board as a whole including the Chairperson of the Company, views expressed by the executive directors and non-executive directors at various level, and quantified the quality, quantity and timeliness of flow of information between the Company, management and the Board and expressed satisfaction.

POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION:

The current policy is to have an appropriate mix of executive and independent directors to maintain the independence of the Board and separate its functions of governance and management. As on 31stMarch, 2015, the Board consists of 7 members. Out of which one is the Managing Director, two is Whole Time Directors and one Women Director.

The policy of the Company on directors' appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other matters provided under Sub section (3) of Section 178 of the Companies Act, 2013, adopted by the Board and are stated in this Board report. We affirm that the remuneration paid to the directors is as per the terms laid out in the nomination and remuneration policy of the Company.

COMMITTEES OF THE BOARD:

Currently, the Board has Seven Committees:1) Audit Committee, 2) Nomination and Remuneration Committee, 3) Risk Management Committee, 4) Corporate Social Responsibility Committee, 5) Shares Transfer /Investor Grievances Committee, (6) Stakeholders Relationship Committee.

A detailed note on the Board and its Committees is provided under the Corporate Governance Report that forms part of this Annual Report.

NOMINATION AND REMUNERATION COMMITTEE AND STAKEHOLDERS RELATIONSHIP COMMITTEE

Pursuant to the Section 178 of the Companies Act, 2013, the Company has set up a Nomination and Remuneration and Stakeholders Relationship Committee under the Chairmanship of the Independent Director Mr. Mahesh Naik, Mr. Sandip C. Save and Mr. Ranjit Dhuru.

The Gist of the Policy of the said committee:

For Appointment of Independent Director (ID):

a. Any person who is between the age of 25 years and below 75 years eligible to become Independent Director(ID);

b. He has to fulfill the requirements as per section 149 of the Companies Act, 2013 read with Clause 49 of the Listing Agreement;

c. Adhere to the code of conduct as per Schedule IV to the Companies Act, 2013;

d. Strictly adhere to the Insider Trading Regulation of the SEBI and Insider Trading policy of the Company;

e. Independent Director should have adequate knowledge and reasonably able to contribute to the growth of the Company and stakeholders;

f. Independent Director should be able to devote time for the Board and other meetings of the company;

g. Entitled for sitting fees and Reasonable conveyance to attend the meetings; and

h. Able to review the policy, participate in the meeting with all the stakeholders of the company at the Annual General Meeting.

CORPORATE SOCIAL RESPONSIBILITY

The composition of Corporate Social Responsibility Committee as per the provisions of section 135 (2) of the Companies Act, 2013:

Sr.No. Composition, Name Of Members

1 Mr. Mahesh Naik - Chairman

2 Mr. Ranjit Dhuru - Managing Director

3 Mr. Nitin K. Shulka - WTD

4 Mr. SandipC.Save

Over the years, we have been striving to achieve a fine balance of economic, environmental and social, while also paying attention to the needs and expectations of our internal as well as external stakeholders. Our corporate social responsibility is not limited to philanthropy, but encompasses holistic community development, institution building and sustainability related initiatives. During the year under review , CSR activity is not applicable to the company.

RISK MANAGEMENT POLICY

The company has developed Risk Management Policy mainly covering the following areas of concerns

1. License and policy of respective government all over the world in connection with export of goods and matter in connection with Software Products.

2. Adequate policy in connection with foreign exchange, management fluctuations thereof duly placed before the Board.

INTERNAL CONTROL SYSTEMS AND THE IRADEQUACY:

The Board has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is defined in the Internal Audit Manual. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company.

Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to Board.

M/s.Udit S. Master, Chartered Accountant is the internal Auditor of the Company.

DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to the Section 134(3)(c) and Section 134 (5) of the Companies Act, 2013, the Board of Directors of the Company hereby confirm:

(i) That in the preparation of the accounts for the financial year ended 31st March, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(ii) That the Directors have 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 at the end of the financial year and of the profit and loss of the Company for the year under review;

(iii) That the Directors have taken proper and sufficient care 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;

(iv) That the Directors have prepared the accounts for the financial year ended 31st March 2015 on a 'going concern' basis.

(v) The internal financial controls laid and have been followed by the company and that such controls are adequate and are operating effectively. Such controls means controls and policies and procedures adopted and adherence by the company for orderly and efficient conduct of the business for safeguarding assets, prevention and detection of frauds and errors and maintenance of accounting records and timely preparation of financial statements and review its efficiency.

(vi) The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

SECRETARIAL AUDITOR

M/s. Ramesh Chandra Mishra & Associates, Company Secretary in Practice was appointed to conduct the secretarial audit of the Company for the financial year 2014-15, as required under Section 204 of the Companies Act, 2013 and Rules there under. The Secretarial Audit Report for F.Y. 2014-15 is Annexure-III to this Board's Report.

The Board has re-appointed M/s. Ramesh Chandra Mishra & Associates, Company Secretary in Practice, as secretarial auditor of the Company for the financial year 2015-16.

SIGNIFICANT AND MATERIAL ORDER SPASSED BY THE COURTS/REGULATORS:

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future.

CONSERVATION OF ENERGY,TECHNOLOGY AND FOREIGN EXCHANGE:

As required by the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 the relevant information pertaining to conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows:

A) CONSERVATION OF ENERGY:

The Company continues its policy of encouraging energy conservation measures. The regular review of energy consumption and the systems installed to control utilization of energy is undertaken.

B) RESEARCH & DEVELOPMENT ACTIVITIES:

There is a dedicated team being formed which will conduct market research on the latest molecules and the advancements in pharmaceuticals and prepare the inputs which will be used to create the R&D Pipeline. Continuous efforts are being made to improve reliability and quality through in house R&D efforts which is headed by WTD Mr. Nitin K. Shukla.

C) TECHNOLOGY ABSORPTION The Company is equipped with technologies from world's leaders.

D) FOREIGN EXCHANGE EARNINGS&OUTGO: (Rs, in Lacs)

2014-2015 2013-2014

a. Foreign Exchange Earned 5161.24 7439.82

b. Foreign Exchange Used 110.85 4750.77

VIGIL MECHANISM/WHISTLE BLOWER POLICY:

The Company has a vigil mechanism named Fraud and Risk Management Policy (FRM) to deal with instance of fraud and mismanagement, if any, in staying true to our values of Strength, Performance and Passion and in line with our vision of being one of the most respected companies in India, the Company is committed to the high standards of Corporate Governance and stakeholder responsibility.

A high level Committee has been constituted which looks into the complaints raised. The Committee reports to the Audit Committee and the Board.

The FRM Policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination will be meted out to any person for a genuinely raised concern.

RELATED PARTY TRANSACTIONS/CONTRACTS:

Pursuant to the Section 134(3)(h) of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014, the particulars of contract or arrangement entered into by the Company with related parties referred to in Section 188(1) in Form AOC-2 is Annexed-IV to this Board's Report.

The details of such related party transactions are available in the Notes to the Standalone financial statements section of the Annual Report.

PARTICULARS OF LOANS,GUARANTEES OR INVESTMENTS:

Loans, Guarantees and Investments covered under section 186 of the Companies Act, 2013 form part of the notes to the financial statements provided in this Annual Report.

EXTRACT OF ANNUAL RETURNS

Pursuant to the Section 134(3)(a) of the Companies Act, 2013, the details forming part of the extract of the Annual Return is Form MGT-9 is Annexure-V.

HUMAN RESOURCES MANAGEMENT:

We take this opportunity to thank employees at all levels for their dedicated service and contribution made towards the growth of the company.The relationship with the workers of the Company's manufacturing units and other staff has continued to be cordial.

To ensure good human resources management at the company, we focus on all aspects of the employee lifecycle. This provides a holistic experience for the employee as well. During their tenure at the Company, employees are motivated through various skill-development, engagement and volunteering programs.

As per provisions of Section 197(12) of the Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is Annexure-VI to this Board's report.

In terms of Section 197(12) of the Companies Act, 2013, read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, no employee(s) drawing remuneration in excess of limits set out in said rules forms part of the annual report.

Considering the first proviso to Section 136(1) of the Companies Act, 2013, the Annual Report is being sent to the members of the Company and others entitled thereto. The said information is available for inspection at the registered office of the Company during business hours from 11 a.m to 2 p.m on working days of the Company up to the date of the ensuing Annual General Meeting. Any shareholder interested in obtaining a copy thereof, may write to the Company Secretary in this regard.

CORPORATE GOVERNANCE:

A Report on Corporate Governance along with a Certificate from Mr. Udit S. Master, Chartered Accountant, regarding compliance with the conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with Stock Exchange forms part of this Report and Annexure-VII to this Board's Report.

INSURANCE OF ASSETS

All the fixed assets, finished goods, semi-finished goods, raw material, packing material and goods of the company lying at different locations have been insured against fire and allied risks.

BANK AND FINANCIAL INSTITUTIONS

Directors are thankful to their bankers for their continued support to the company.

ACKNOWLEDGEMENT

Your Directors would like to place on record their sincere appreciation of the continued co-operation, support and assistance given by shareholders, customers, vendors, bankers, service providers, suppliers and employees at all levels.

FOR AND ON BEHALF OF THE BOARD

PLACE : MUMBAI RANJIT DHURU

DATED : 14th November, 2015 CHAIRMAN & MANAGING DIRECTOR

DIN- 00044279


Mar 31, 2014

Dear Members,

The Directors are pleased to present their 27th Annual Report together with the Audited Statement of Accounts for the year ended 31st March, 2014. Members may kindly note that vide letter dated 23/09/2014 received from Government of India, Ministry of Corporate Affairs, Office of the Registrar of Companies, Maharashtra, the Company has obtained extension of three months for holding the Annual General Meeting.

FINANCIAL PERFORMANCE

Amount (Rs. In Lacs)

PARTICULARS 31/03/20141 31/03/2013

Turnover 7575 11092

Profit Before Depreciation 5868 5296

Less: Depreciation 7756 8226

Profit /(Loss) Before Tax (1887) (2930)

Less: Provision for Taxation / Reversal of Deferred Tax (54) 411

Profit After Tax (1833) (2519)

Transfer to General Reserve NIL NIL

DIVIDEND

In view of the loss incurred during the year, it has not been possible for your Directors to recommend any dividend for the year. BUSINESS REVIEW & FUTURE PROSPECTS

Your company''s performance during the year has been lackluster. It could have been much better but due to the dollar fluctuations and writing off certain bad debts the company''s balance sheet carries a loss of Rs. 18.33 crores. Your company is engaged in serious discussion with investors who have liked the indigenous product and manufacturing strategy now popularly known as "make in India", In Defense, smart city, smart home and Integrated Intelligent Transport. Keeping this in mind, the directors have proposed an enabling resolution to accommodate the new set of investors.

On completion of this financial phase your company will take on far footing initiatives to implement the forward looking business plan which have as strong thrust on the above mentioned verticals which will make your company truly a "make in india" participant.

FINANCE

While the recovery of receivables continued to remain at a slow rate, your Company had to write off sizable amounts as bad debts during the year. While proposal for one time settlement of the dues of lending bankers has been on a positive track, the closure of loan accounts has been delayed in spite of Company''s rigorous efforts for early settlement. Further, your Company is in the advanced stage of finalizing with prospective investors to fund its projects for that resolution has been kept for your approval.

The 354 numbers of FCCBs, if converted into GDRs/equity shares at the conversion price of Rs. 13.76 would result into issuance of additional 1,12,10,428 numbers of equity shares of Rs. 02/-each.

DIRECTORATE

Mr. Ranjit Dhuru retire by rotation at the ensuing Annual General Meeting. Mr Ranjit Dhuru being eligible, offers himself for re- appointment.

Pursuant to Sections 149, 152 and any other applicable provisions of the Companies Act, 2013, Mr.Mahesh Naik (DIN 00144690) and Mr. Sandip Chintamani Save (DIN 00452033) are proposed to be appointed as Independent Directors to hold office for five consecutive years.

Mr. Ranjit Mohan Dhuru (DIN: 00044279), Mr. Nitin Kashinath Shukla (DIN 00044347) & Mr. Mukul Suryakant Dalal (DIN 00181066), Managerial Personnel are proposed to be re-appointed as the Managing Director and Whole-time Directors respectively.

Brief resume of the Directors proposed to be appointed/re-appointed, nature of their expertise in specific functional areas, names of the Companies in which they hold directorships and membership/Chairmanship of Committees of the Board, their shareholding in the Company and inter-se relationship with Directors, as stipulated under section 149(6) of the Companies Act, 2013 and Clause 49 of Listing Agreement entered into with the Stock Exchanges, are set out in the Notice forming part of the Annual Report.

The Board commends the resolution to the members for the respective appointments/re-appointment.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 217(2AA) of the Companies Act, 1956, with respect to Directors'' Responsibility Statement, it is hereby confirmed:

i. that in the preparation of the annual accounts for the year ended 31st March, 2014, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii. that the directors had 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 at the end of the Financial Year ended 31st March, 2014 and of the profit of the Company for that period;

iii. 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, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. that the directors had prepared the annual accounts for the year ended 31st March, 2014, on a ''going concern'' basis.

FIXED DEPOSITS

The Company has not accepted any Fixed Deposits from the Public.

SUBSIDIARY COMPANIES

Mihir Properties Pvt Ltd is non-functional.

In accordance with the General Circulars No: 2 /2011 No: 51/12/2007-CL-III and No. 3/2011 No: 5/12/2007-CL-III dated 08th February 2011 and 21st February 2011, respectively, issued by the Ministry of Corporate Affairs, Government of India, the Balance Sheet, Profit and Loss Account and other documents of the subsidiary companies are not being attached with the Balance Sheet of the Company. The Annual Accounts of the subsidiary companies will be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies. The Company will make available the Annual Accounts of the subsidiary companies and the related information to any member of the Company who may be interested in obtaining the same. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiary companies. The statement pursuant to Section 212 of the Companies Act, 1956 containing details of subsidiaries of the Company, forms part of the Annual Report.

AUDITORS

The present Statutory Auditors of the Company, M/s. GMJ & Co., Chartered Accountants, retire at the conclusion of the ensuing Annual General Meeting. The Company has received a letter as required under Section 141 of the Companies Act, 2013 (erstwhile section 224(1B) of the Companies Act, 1956) from M/s. GMJ & Co., Chartered Accountants, confirming their eligibility and willingness to act as Statutory Auditors, if re-appointed. M/s. GMJ & Co., Chartered Accountants shall be appointed as Statutory Auditors of the Company to hold office for the period of 5 (five) years from the conclusion of this Annual General Meeting until the conclusion of the sixth Annual General Meeting to examine and audit the accounts of the Company for the financial year 2014-15, 2015-16, 2016-17, 2017-18 and 2018-19 subject to ratification by the members of the Company at all the subsequent AGMs.

PARTICULARS OF EMPLOYEES

Details of remuneration paid to employees, as required under Section 217(2A) of the Companies Act, 1956, are set out in a separate statement attached hereto as Annexure "A" and the same forms part of this Report.

CONSERVATION OF ENERGY, ETC.

Your Company endeavors to ensure conversation of energy. However, as a software company, energy costs constitute a small portion of the total cost and there is not much scope for energy conservation. Form A as prescribed under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is not applicable for software industry. The particulars of Technology Absorption are also not applicable. The Foreign Exchange Earnings and Outgo are as under:

CIF Value of Imports: Rs. 3997.27 lacs

Expenditure in Foreign currency: Rs. 4750.77 lacs

Earnings in Foreign currency: Rs. 7439.82 lacs

OTHER DISCLOSURES

The disclosures required to be made under the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, together with a certificate obtained from the Statutory Auditors confirming compliance, is given in Annexure "B".

Pursuant to Clause 49 of the listing agreement entered into with the Stock Exchanges, the Management Discussion and Analysis, Corporate Governance Report and a Certificate obtained from Practicing Chartered Accountant confirming compliance form part of the Annual Report.

ACKNOWLEDGEMENT

Your Directors would like to place on record their sincere appreciation of the continued co-operation, support and assistance given by shareholders, customers, vendors, bankers, service providers, suppliers and employees at all levels.

FOR AND ON BEHALF OF THE BOARD

PLACE : MUMBAI RANJIT DHURU DATED : 28th November, 2014 CHAIRMAN & MANAGING DIRECTOR DIN- 00044279


Mar 31, 2012

To , The Members of Aftek Limited,

The Directors are pleased to present their 25th Annual Report together with the Audited Statement of Accounts for the year ended 31st March, 2012.

FINANCIAL PERFORMANCE

Amount (Rs. in lacs)

PARTICULARS 31/03/2012 31/03/2011

Turnover 12,124 15,486

Profit Before Depreciation 10,074 10,726

Less:Depreciation 8,856 9,254

Profit Before Tax 1,218 1,472

Less : Provision for Taxation 76 75

Profit After Tax 1,142 1,397

Transfer to General Reserve NIL NIL

DIVIDEND

Considering the heavy investments and restructuring that your Company is undergoing and the efforts being made to augment cash flow as also looking at the financial performance your Directors have not considered it appropriate to recommend any dividend for the year.

BUSINESS REVIEW & FUTURE PROSPECTS

The industry continues to suffer under global slowdown. While your Company's performance for the year under review has been rather dismal, your Board attributes this largely to the continuing slowdown in the western world, low traction of new clients and business from the West which has traditionally been your Company's hunting ground. At the same time, the Company is very much encouraged by the fact that the development of new products in different verticals have received a very strong endorsement from Defence establishments particularly the Indian Navy, which has approved two major products created by your Company along with its associates. This certification and approval gives your Company a huge opportunity in the near, mid and long term periods to grow and scale up its business with the defence establishment. It is public knowledge that India's security concerns have made the Indian Government commit very large funds for the defence establishments and the Indian Navy is one of the large recipients of this allocation.

Your Company has received a large number of enquiries also about its Intelligent Transport System (ITS) since this product is the only one of its kind in India having end-to-end solutions. Your directors feel that this opportunity too is large enough to scale up operations in this vertical in the forthcoming years. Similarly, in the Remote Infrastructure Management (RIM) arena, Aftek VTS, Aftek Protocol Converters and other components of VTS are getting acceptance and enquiries far in excess of your Company's expectations. Therefore, your Directors feel that although there has been a downward trend of the topline for the last few years, the strategic investments made in these verticals whereby various products were created by your Company are steps in the right direction.

FINANCE

Due to global slow down the Company has been experiencing reduced business and slow rate of recovery of receivables giving rise to severe liquidity situation. Resultantly, the Company has not been able to repay its debts to the bankers in time leading to initiation of recovery processes by lenders. While part of the dues have been settled by liquidating the property of the Company, the process of arriving at one-time settlement with bankers is underway.

At an Extra-ordinary General Meeting held on 08th June, 2010, Members had approved by means of a special resolution, the proposal to utilize a sum of Rs.215 Crores (Rupees Two Hundred & Fifteen Crores only) standing to the credit of the Securities Premium Account of the Company by allocating and /or earmarking to adjust product development expenditure incurred and / or to be incurred, diminution in value of investments, if any, and loss arising on account of foreign exchange fluctuations. The Hon'ble High Court of Judicature at Bombay, vide Order dated 13th August, 2010 had sanctioned the aforesaid utilisation of Securities Premium Account and the same has been implemented from the second quarter of last year. While an amount of Rs 196.80 crores was so adjusted in 2010-2011, the balance amount of Rs 18.20 crores has been adjusted during the year under review.

As regards 1% Foreign Currency Convertible Bonds Due 2010 ("FCCBs") of USD 10,000 each, out of 3,450 FCCBs issued in 2005, a total number of 2570 FCCBs have already been converted into GDRs/equity shares and balance 880 numbers of FCCBs continue to remain outstanding as on 31st March, 2012. No conversion of FCCBs has taken place during the year under review. As informed earlier, the Company had initiated the process of re-setting the conversion price of the FCCBs as per the applicable norms. Approval of Reserve Bank of India for the same was received vide their letter No. FED/CO/ECBD/ 10308/03.02.775/11-12 dated October 31, 2011. The holders of the FCCBs vide their written resolution of 25th July, 2012 have consented, inter alia, to the revision of Conversion Price of Bonds from Rs 75.20 to Rs 13.76 and elongation of maturity period from 25th June, 2010 to 21st December, 2012 as well as waiver of events of defaults and interest payments. Accordingly, the Company has executed a Supplemental Trust Deed on 25th July, 2012 with Bank of New York Mellon, the Trustees, for giving effect to the aforesaid amendments. All the outstanding 880 numbers of FCCBs, if converted into GDRs/ equity shares at the revised conversion price of Rs 13.76 would result into issuance of additional 2,78,67,733 numbers of equity shares of Rs 02/-each.

DIRECTORATE

Mr Ranjit Dhuru, Dr S S S P Rao and Mr Mahesh Naik retire by rotation and are eligible for re-appointment. Attention of the members is invited to the relevant items in the Notice of the Annual General Meeting.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 217(2AA) of the Companies Act, 1956, with respect to Directors' Responsibility Statement, it is hereby confirmed:

i. that in the preparation of the annual accounts for the year ended 31st March, 2012, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii. that the directors had 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 at the end of the Financial Year ended 31st March, 2012 and of the profit of the Company for that period;

iii. 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, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. that the directors had prepared the annual accounts for the year ended 31st March, 2012, on a 'going concern' basis.

FIXED DEPOSITS

The Company has not accepted any Fixed Deposits from the Public.

SUBSIDIARY COMPANIES

The Company's wholly-owned subsidiary, Mihir Properties Private Limited, has earned some rental income to support its statutory payments.

The product of Digihome Solutions Private Limited (DSPL) is undergoing a revision and due to general glut in the real estate sector the business for the year under review has been rather slack. However, the order book is very strong and as the pick up of the realty industry happens this year, with the new and better revised products the company should be doing much better. In our last annual report we had reported about possibility of takeover of DSPL by a well-known international company. We have to report that due to slow down the matter has been deferred. The said international company has however expressed its keenness to take participation in DSPL when things ease up by the third quarter next year. Accordingly, there is cautious optimism in respect of future of DSPL.

In accordance with the General Circulars No: 2 /2011 No: 51/12/2007-CL-III and No. 3/2011 No: 5/12/2007-CL-III dated 08th February 2011 and 21st February 2011, respectively, issued by the Ministry of Corporate Affairs, Government of India, the Balance Sheet, Profit and Loss Account and other documents of the subsidiary companies are not being attached with the Balance Sheet of the Company. The Annual Accounts of the subsidiary companies will be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies. The Company will make available the Annual Accounts of the subsidiary companies and the related information to any member of the Company who may be interested in obtaining the same. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiary companies. The statement pursuant to Section 212 of the Companies Act, 1956 containing details of subsidiaries of the Company, forms part of the Annual Report.

AUDITORS

At the ensuing Annual General Meeting, Members will be required to appoint Auditors for the current year and fix their remuneration. M/s. GMJ & Co., Chartered Accountants, retire at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. A Certificate from the Auditors has been received to the effect that their appointment, if made, would be within the limits prescribed under Section 224(1B) of the Companies Act, 1956.

AUDITORS' REPORT

As regards the observations in paragraphs (ix) and (xi) of the Annexure to the Report of the Auditors, these are due to adverse liquidity conditions.

PARTICULARS OF EMPLOYEES

Details of remuneration paid to employees, as required under Section 217(2A) of the Companies Act, 1956, are set out in a separate statement attached hereto as Annexure "A" and the same forms part of this Report.

CONSERVATION OF ENERGY ETC.

Your Company endeavors to ensure conversation of energy. However, as a software company, energy costs constitute a small portion of the total cost and there is not much scope for energy conservation. Form A as prescribed under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is not applicable for software industry. The particulars of Technology Absorption are also not applicable. The Foreign Exchange Earnings and Outgo are as per Para Nos. 30 (d) and 30 (c) of the Notes to Accounts.

OTHER DISCLOSURES

The disclosures required to be made under the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, together with a certificate obtained from the Statutory Auditors confirming compliance, is given in Annexure "B".

Pursuant to Clause 49 of the listing agreement entered into with the Stock Exchanges, the Management Discussion and Analysis, Corporate Governance Report and a Certificate obtained from Practising Company Secretary confirming compliance form part of the Annual Report.

ACKNOWLEDGEMENT

Your Directors would like to place on record their sincere appreciation of the continued co-operation, support and assistance given by shareholders, customers, vendors, bankers, service providers, suppliers and employees at all levels.

FOR AND ON BEHALF OF THE BOARD

RANJIT DHURU

CHAIRMAN & MANAGING DIRECTOR PLACE : MUMBAI

DATED : August 31, 2012


Mar 31, 2011

The Members of Aftek Limited,

The Directors are pleased to present their 24th Annual Report together with the Audited Statement of Accounts for the year ended 31st March, 2011.

FINANCIAL PERFORMANCE

Amount (Rs. in lacs)

PARTICULARS 31/03/2011 31/03/2010

Turnover 15,486 18,203

Profit Before Depreciation 10,726 8,620

Less: Depreciation 9,254 8,325

Profit Before Tax 1,472 295

Less : Provision for Taxation 75 267

Profit After Tax 1,397 28

Transfer to General Reserve - -

DIVIDEND

Considering the heavy investments and restructuring that your Company is undergoing, the efforts being made to augment cash flow as also looking at the financial performance your Directors have not considered it appropriate to recommend any dividend for the year.

BUSINESS REVIEW & FUTURE PROSPECTS

Although last year your Company saw an improvement in the sales funnel and conversion from sales funnel to orders, the quantum of business in the services area has not seen the kind of upswing that was anticipated. Your Company has trimmed its work-force to suit the new environment which is based on the new strategy and business initiatives. The product and solution development is slowly taking centrestage with lot of capital expenditure being invested in these products. The Company has products and solutions with its own IPs and also acting as import substitution for advance Battery Management System which has been tested on submarines and accepted by the Indian Navy which forms only a part of the Indian defence industry. Keeping an eye on the tremendous potential in the defence segment, your Company has got itself registered as an approved vendor in the "below 100 crore" category. We see this division gaining positive momentum in this coming year and recording incremental business in near future leading to shifting of your Company's registration to a higher category.

The Remote Infra Management (RIM) building blocks namely, Aftek Protocol Converter, Remote Management Dashboard and Software and Vehicle Tracking System (VTS) along with other components is now getting integrated into various verticals namely, telecommunication, logistics etc. Similarly the Intelligent Transport System is moving ahead with new standards being integrated into our earlier field tested systems. The urban renewal and modernization initiative is being addressed by this division. We see a significant movement here with substantial orders already in the matured pipeline. The Company's IP which was transferred to Digihome Solutions Pvt Ltd has caught the eye of well-known large international companies. We expect a value realization by either a JV or by liquidating our stake in this company. Therefore, whether the times are good or bad economically, IP valuation is the only true valuation which your Company believes can retain its value proposition. Therefore, your Company has decided that investment in intellectual property and creating the same is the way forward and accordingly, it has positioned itself in the verticals mentioned above.

FINANCE

At an Extra-ordinary General Meeting held on 08th June, 2010, Members had approved by means of a special resolution, the proposal to utilize a sum of Rs.215 Crores (Rupees Two Hundred & Fifteen Crores only) standing to the credit of the Securities Premium Account of the Company by allocating and /or earmarking to adjust product development expenditure incurred and / or to be incurred, diminution in value of investments, if any, and loss arising on account of foreign exchange fluctuations. The Hon'ble High Court of Judicature at Bombay, vide Order dated 13th August, 2010 had sanctioned the aforesaid utilisation of Securities Premium Account and the same has been implemented from the second quarter of the year under review.

As regards 1% Foreign Currency Convertible Bonds Due 2010 ("FCCBs") of USD 10,000 each, out of 3,450 FCCBs issued in 2005, a total number of 2570 FCCBs have already been converted into GDRs/equity shares and balance 880 numbers of FCCBs continue to remain outstanding as on 31st March, 2011. No conversion of FCCBs has taken place during the year under review. As informed earlier, the Company initiated the process of re-setting the conversion price of the FCCBs as per the applicable norms and while the Shareholders and Bondholders have approved the proposal, approval from Reserve Bank of India is awaited .

Further, no Stock Options were exercised during the year.

DIRECTORATE

Mr Mukul Dalal, Mr V J Masurekar and Mr Sandip Save retire by rotation and are eligible for re-appointment. Attention of the members is invited to the relevant items in the Notice of the Annual General Meeting.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 217(2AA) of the Companies Act, 1956, with respect to Directors' Responsibility Statement, it is hereby confirmed:

i. that in the preparation of the annual accounts for the year ended 31st March, 2011, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii. that the directors had 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 at the end of the Financial Year ended 31st March, 2011 and of the profit of the Company for that period;

iii. 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, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. that the directors had prepared the annual accounts for the year ended 31st March, 2011, on a 'going concern' basis.

FIXED DEPOSITS

The Company has not accepted any Fixed Deposits from the Public.

SUBSIDIARY COMPANIES

Mihir Properties Pvt Ltd. has earned some rental income to support its statutory payouts.

Digihome in the last three years has been getting good traction with the digital home product in the home segment and large townships namely, Lavasa and other well-known builders have endorsed the product range and Digihome is in receipt of five substantial orders. In the last three years, the company has been doubling its revenue and considering the sales funnel it is expected to double its revenue this year too making it a significant player in the digital home and automation segment. Several well- known international companies in this segment or companies intending to enter into this segment have shown great interest in this company and serious dialogue is underway for either a Joint Venture or dilution of significant stake to larger players.

Aftek Sales & Services Pvt Ltd being non-functional, has been dissolved on its application made pursuant to the Easy Exit Scheme, 2011 notified by the Government of India, Ministry of Corporate Affairs by General Circular No. 6 /2010 F. No. 2/7/ 2010-CL V dated 03rd December, 2010.

In accordance with the General Circulars No: 2 /2011 No: 51/12/2007-CL-III and No. 3/2011 No: 5/12/2007-CL-III dated 08th February 2011 and 21st February 2011, respectively, issued by the Ministry of Corporate Affairs, Government of India, the Balance Sheet, Profit and Loss Account and other documents of the subsidiary companies are not being attached with the Balance Sheet of the Company. The Annual Accounts of the subsidiary companies will be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies. The Company will make available the Annual Accounts of the subsidiary companies and the related information to any member of the Company who may be interested in obtaining the same. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiary companies. The statement pursuant to Section 212 of the Companies Act, 1956 containing details of subsidiaries of the Company, forms part of the Annual Report.

AUDITORS

At the ensuing Annual General Meeting, members will be required to appoint Auditors for the current year and fix their remuneration. M/s. GMJ & Co., Chartered Accountants, retire at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. A Certificate from the Auditors has been received to the effect that their appointment, if made, would be within the limits prescribed under Section 224(1B) of the Companies Act, 1956.

AUDITORS' REPORT

Auditors' observations in paragraphs 5 of their report have been explained under paragraphs B.14 and B.16 of Notes to Accounts. As regards observations made by the Auditors in the para (ix) (a) and (xi) of the Annexure to their Report, these are due to adverse liquidity conditions.

PARTICULARS OF EMPLOYEES

Details of remuneration paid to employees, as required under Section 217(2A) of the Companies Act, 1956, are set out in a separate statement attached hereto as Annexure "A" and the same forms part of this Report.

CONSERVATION OF ENERGY ETC.

Your Company endeavors to ensure conversation of energy. However, as a software company, energy costs constitute a small portion of the total cost and there is not much scope for energy conservation. Form A as prescribed under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is not applicable for software industry. The particulars of Technology Absorption are also not applicable. The Foreign Exchange Earnings and Outgo are as per Para Nos. B 3 (vi) and (v) of the Notes to Accounts.

OTHER DISCLOSURES

The disclosures required to be made under the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, together with a certificate obtained from the Statutory Auditors confirming compliance, is given in Annexure "B".

Pursuant to Clause 49 of the listing agreement entered into with the Stock Exchanges, the Management Discussion and Analysis, Corporate Governance Report and Practicing Company Secretary's Certificate confirming compliance form part of the Annual Report.

ACKNOWLEDGEMENT

Your Directors would like to place on record their sincere appreciation of the continued co-operation, support and assistance given by shareholders, customers, vendors, bankers, service providers, suppliers and employees at all levels.

FOR AND ON BEHALF OF THE BOARD

RANJIT DHURU CHAIRMAN & MANAGING DIRECTOR

PLACE : MUMBAI

DATED : August 31, 2011

 
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