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Directors Report of Benares Hotels Ltd.

Mar 31, 2015

Dear Members,

The Directors hereby present the Forty Fourth Annual Report of the Company together with the Financial Statement (Audited Statements of Account) for the year ended 31st March, 2015.

OPERATING AND FINANCIAL RESULTS (Rs Lacs) (Rs Lacs) 2014-15 2013-14

Income 4824.06 4411.88

Gross Profit for the year 1693.01 1565.98

Less: Depreciation 267.23 190.28

Less: Interest

Profitbeforetax 1425.78 1375.70

Less: Provision for tax:

-CurrentTax 445.84 459.89

-DeferredTax 57.77 11.33

- Earlier years Taxes (0.45) 6.49

NetProfit 922.62 897.99

Add: Balance brought forward from previous year 2012.80 1519.00

Balance available for appropriations 2935.42 2416.99

APPROPRIATIONS :

(a) A dividend @ 200 % i.e. Rs.20/- per equity share (previous year 200% i.e. Rs. 20/- per equity share) on 13,00,000 Equity Shares, which, if approved by the Shareholders at the Annual General Meeting, to be held on Friday, 21st August, 2015, will be paid out ofthe provision for dividend 260.00 260.00

(b) Tax on Dividend 52.93 44.19

(c) Amount transferred to General Reserve — 100.00

(d) Balance carried forward 2622.49 2012.80

OPERATIONS

The Company has improved its performance during the year registering 9% growth in revenue. While Room revenue was 11% higher than previous year, the Food and Beverage revenue was higher by 7% over previous year.

During the year under report, The Gateway Hotel, Balaghat Road, Gondia, Maharashtra comprising 34 rooms and related facilities has been made operational. The directors hope that the hotel will be well received in the market.

Owing to the opening of new hotel at Gondia, the Depreciation for the year was higher at Rs. 267.23 Lacs as compared to Rs. 190.28 Lacs in the previous year. The Profit before taxes for the year at Rs. 1425.78 Lacs was 4% higher than the previous year.

DIVIDEND

Your Directors recommend the payment of dividend @200% (previous year dividend @ 200%) per equity share involving distribution of Rs. 260.00 lacs.

PARTICULARS OF EMPLOYEES

The Company had no employees during the year who were in receipt of remuneration aggregating to:

(a) Not less than Rs. 60.00 lacs for the year, if employed throughout the financial year, or

(b) Not less than Rs. 5.00 lacs per month, if employed for part ofthe financial year.

DIRECTORS

During the year under report, Mr. Raymond N. Bickson resigned from the directorship of the Company with effect from 1st September, 2014. Mr. Prabhat Verma resigned from the directorship of the Company w.e.f. 29th April, 2015. The Directors place on record their appreciation of the services rendered by Mr. Bickson and Mr. Verma during their tenure as Director ofthe Company.

Mr. Rakesh Sarna and Mr. Rohit Khosla were appointed as Additional Directors by the Board of Directors at its meeting held on 24th March, 2015 and 7th May, 2015 respectively on the recommendation of the Nomination & Remuner- ation Committee. In terms of Section 161 of the Companies Act, 2013 and Article 122 of the Articles of Association of the Company, Mr. Sarna and Mr. Khosla hold office up to the date of the Annual General Meeting of the Company. It is proposed to appoint Mr. Sarna and Mr. Khosla as Director(s) of the Company at the ensuing Annual General Meeting. The Board of Directors commends their appointment. Except Mr. Sarna and Mr. Khosla, no other Director is interested in this item.

In accordance with the Companies Act, 2013 and the Articles of Association of the Company, Dr. Anant Narain Singh, Director of the Company is liable to retire by rotation and being eligible seeks reappointment.

KEY MANAGERIAL PERSONNEL

During the year under report, in terms ofSection 203 of Companies Act, 2013, your Company has appointed Mr. Ahmar Siddiqui as the ChiefExecutive Officer (CEO), Mr. Ravi Sharma as the Chief Financial Officer (CFO) and formalized the appointment ofMr. Prakash Bhatia, who already was the Company Secretary of the Company, as the Key Managerial Personnel ofthe Company.

INFORMATION PURSUANT TO RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014

The information pursuant to Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given in Annexure

SUBSIDIARY COMPANIES

The Company does not have any subsidiary company.

HOLDING COMPANY

The Indian Hotels Company Limited (IHCL) is the Ultimate Holding Company of the Company.

NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR

The Company had convened 5 (five) Board Meetings during the financial year under report.

AUDIT COMMITTEE AND VIGIL MECHANISM

In terms of Section 177 of the Companies Act, 2013, your Company has an Audit Committee with Mr. B.L. Passi, Mr. Shriraman, and Mrs. Rukmani Devi as its members.

Your Company has adopted the policy on vigil mechanism/Whistleblower policy in the Meeting of the Board of Directors held on 17th July, 2014 providing mechanism for employees of the Company to report their grievances to the Audit Committee with adequate protection against victimization to those who express their concerns.

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

In terms of Section 135 of the Companies Act, 2013 (the Act), your Directors have constituted the Corporate Social Responsibility Committee (CSR Committee) of the Board with Dr. Anant Narain Singh, Mr. D.R. Kaarthikeyan and Mr. Rohit Khosla as the members of the Committee. The terms of reference of the CSR Committee include the matters specified in Section 135 of the Act read with rules thereunder. Your Company has adopted the Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the

Company and the monitoring thereof as recommended by the CSR Committee. The details as required under Section 135 of the Companies Act, 2013 read with rule 8 of (Corporate Social Responsibility Policy) Rules, 2014, are given in Annexure 2 to this Report.

NOMINATION AND REMUNERATION COMMITTEE

In terms of Section 178(1) of the Companies Act, 2013 (the Act), the Company has a Nomination and Remuneration Committee (NRC) of the Board with Dr. Anant Narain Singh, Mrs. Rukmani Devi and Mr. Shriraman as the members of the Committee. The Committee met twice during the year on 17th, July, 2014 and 24th March, 2015.

In terms of the requirement of section 178(3) and Clause 49 of the Listing Agreement, NRC formulated and recommended to the Board a policy relating to the remuneration for the directors, KMPs and other employees which was adopted by the Board. The key features ofthe said policy are:

- Overall remuneration (sitting fees and Commis- sion) should be reasonable and sufficient to attract, retain and motivate directors aligned to the requirements ofthe Company;

- Overall remuneration practices should be consistent with recognized best practices

- Within the parameters prescribed under the law, the payment of sitting fees and commission will be recommended by NRC and approved by the Board.

- The aggregate commission payable to the Directors will be recommended by NRC to the Board based on company performance, profits, return to investors, shareholder value creation and any other significant qualitative parameters as may be decided by the Board.

- The quantum ofcommission for each director shall be recommended by NRC to the Board based upon the outcome of the evaluation process drive by various factors including attendance and time spent in the Board and committee meetings, individual contributions at the meetings and contributions made by the Directors other than in meetings.

INTERNAL COMPLAINTS COMMITTEE

The Company has an 'Internal Complaints Committee' under The Sexual Harassment ofWomen at Workplace (Prevention, Prohibition and Redressal) Act, 2013 for the prevention and redressal of complaints of sexual harassment and for the matters concerned, connected or incidental thereto.

The Company has not received any complaint on sexual harassment during the financial year 2014-15.

DECLARATION BY INDEPENDENT DIRECTORS

In terms of Section 149(7) of the Companies Act, 2013 (the Act), the Independent Directors have given a declaration that they meet the criteria of independence as per Section 149(6) of the Act.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

In addition to the Corporate Governance Guidelines discussed and adopted by the Board which, inter alia, included the role, rights and responsibilities of independent directors, a familiarization programme for independent directors was conducted during the year under report per details on the website of the Company www.benareshotelslimited.com.

LOANS, GUARANTEES AND INVESTMENTS MADE UNDER SECTION 186

During the year under report, the Company has placed a sum of Rs. 7.00 crores as short term Inter Corporate Deposits with bodies corporate within the limits prescribed under Section 186 of the Companies Act, 2013.

SECRETARIALAUDIT REPORT

In terms of Section 204(1) of the Companies Act, 2013, M/s A K Bhayana & Associates, Company Secretaries, were appointed by the Company as the Secretarial Auditor. The secretarial audit report as obtained from them is attached to this Report as Annexure 3. The report is self explanatory and does not call for any comments.

ANNUAL RETURN

The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration ) Rules 2014 is furnished in Annexure 4 to this Report.

CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All related party transactions that were entered into during the financial year under report were at arm's length basis and in the ordinary course of business.

The Company has developed a Related Party Transactions Framework under the Policy on Related Party Transactions, which policy is also available at Company's website www.benareshotelslimited.com, for the purpose of identification and monitoring of such transactions. Prior omnibus approval of the Board is obtained for transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted and a statement giving details of all the related party transactions is placed before the Audit Committee for its approval on a quarterly basis.

CORPORATE GOVERNANCE

As required by Clause 49 of the Listing Agreement with the Stock Exchanges, the report on Management Discussion and Analysis, Corporate Governance as well as the Auditors' Certificate regarding compliance of conditions of Corporate Governance, forms part of the Annual Report.

During the year under review, there were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and the Company's Operations.

RISKMANAGEMENT POLICY

Pursuant to Clause 49 of the Listing Agreement, the Company has formulated a Risk Management Policy. The Company has a robust Risk Management framework to identify and evaluate business risks and opportunities. This framework seeks to create transparency, minimize adverse impact on business objective and enhance the Company's competitive advantage. The risk framework defines the risk management approach across the enterprise at various levels including documentation and reporting.

The framework enables risks to be appropriately rated and graded in accordance with their potential impact and likelihood. The two key components of risks are the probability (likelihood) of occurrence and the impact (consequence) of occurrence, if the risk occurs. Risk is analyzed by combining estimates of probability and impact in the context of existing control measures.

Existing control measures are evaluated against Critical Success Factors (CSFs) and Key Performance Indicators (KPIs) identified for those specific controls. Guiding principles to determine the risk consequence (impact), probability of occurrence (likelihood factor) and mitigation plan effectiveness have been set out in Risk Register.

The key business risks identified by the Company and its mitigation plans are as under:

Strategy Risks: Risk of erosion of market dominance by losing market share, which originates from the choices we make on markets, resources and delivery models that can potentially impact our competitive advantage in the medium and long term. Loss of F&B attractiveness on account of pricing / design / competition.

Industry and Economic Risks: High dependence on US, Europe and East Asian markets for foreign tourists arrival. The economic situation in these parts of the world has a potential impact on the entire tourism industry. Risks arising from the development in the regulatory environment that could impact the Hotel/Tourism Industry. Risks due to geographic concentration of business, primarily in the city of Varanasi.

Operational Risks: High dependence on several technology platforms & systems to operate business - both Internal & External. Cost overruns/ delays in completion of projects. Loss of critical / sensitive data due to leakage / loss / hacking. Increase in fixed cost elements beyond entity control. Highly litigious nature of the industry / adverse consequences of litigation against company. Non-renewal of key licenses and NOCs.

Safety and Security Risks: Risks arising from factors such as Fire, Accidents, Electricity mishaps, etc. Business interruption on account ofnatural calamities / act of God / riots & strikes / political instability and terrorism.

Resources: Risks arising from sub-optimal succession planning and retention of talent pool. Inappropriate utilization of financial capital, talent and infrastructure.

KEY RISKMANAGEMENT PRACTICES

Risk Identification and Impact Assessment: Risk assessment enables risks to be appropriately rated and graded in accordance with their potential impact and likelihood. The two key components of risks are the probability (likelihood) of occurrence and the impact (consequence) if the risk occurs. Risk is analyzed by combining estimates of probabi -lity and impact in the context of existing control measures and included in the risk register. Apart from risk register, internal audit findings also provide input for risk identification and assessment, which is carried out on an annual basis across all functions.

Operational risks are assessed primarily on three dimensions, namely strength of underlying controls, compliance to policies and business procedure effectiveness.

Risk reporting and Disclosure: Risks to the achievement of key business objectives, trend line of risk level, impact and mitigation actions are reported and discussed. The escalation of risk information is timely, accurate and gives complete coverage of the key risks to support management decision making at all levels.

Risk Mitigation and Monitoring: Each Manager creates a risk mitigation plan by employing an effective system of internal controls & checks and balances to mitigate the risks in the most effective manner, including designating responsibilities and providing for upward and onward communication of any significant issues that may merit attention or escalation. All employees actively engage in risk management within their own areas ofresponsibility.

Integration with Strategy and Business Planning:

Identified risks to the business objectives in the near term, medium term and long term are used as one of the key inputs for the development of strategy and annual business plan. Key strategic initiatives are identified to mitigate specific risk.

AUDITORS

At the Annual General Meeting the Members will be required to appoint the Auditors for the current year and fix their remuneration.

CONSERVATION OF ENERGY

The Company has always been conscious of the need for conservation of energy and has been sensitive in making progress towards this end. The Company has implemented following energy conservation initiatives at the hotel:

- Installation of LED lights in lobby, public areas and corridors in place of CFL lights.

- Replacing Existing split AC's with energy efficient inverter AC's at Nadesar Palace.

- Replacing oil based hot water generation with heat pump that also generates useful chilled water concurrently and reduces heat loss.

- Converting primary and secondary pumping system into single variable primary system resulting in savings in electricity consumption.

- Improving power factor and reducing line losses by installing suitable capacitors.

TECHNOLOGYABSORPTION

The activities of the Company do not involve the absorption of technology as envisaged to be furnished pursuant to The Companies (Accounts) Rules, 2014.

FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of the provisions of Section 134(3)(f)(m) of the Companies Act, 2013, read with Rule 8(3)(C) of The Companies (Accounts) Rules, 2014, the Foreign Exchange earned in terms of actual inflows during the year and the Foreign Exchange outgo during the year in terms of actual outflows is furnished in Notes on Accounts (Refer Note 28 and 29 in Notes to Financial Statements).

DIRECTORS EVALUATION

The Board of Directors has made the annual evaluation of its own performance and that of its committees and individual directors based on the review conducted by the Nomination & Remuner- ation Committee by assessing the questionnaires furnished by the directors/members of various committees in respect oftheir selfassessment as well as the assessment ofthe Board/Committees following by the discussions with the directors/members of the Committees.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

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 well defined in the organisation. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee ofthe Board.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control systems 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 therby strengthen the controls. Significant audit observations and corrective actions suggested are presented to the Audit Committee ofthe Board.

DIRECTORS ' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(3)(C) & 134(5) of the Companies Act, 2013, the Board of Directors, based on the representations received from the Operating Management, hereby confirms that.

a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

b) 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 as at March 31, 2015 and of the profit of the Company for that period;

c) 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) The Directors had prepared the annual accounts on a going concern basis;

e) The Directors had laid down internal financial controls to be followed by Company and that such internal financial controls are adequate and were operating effectively; and

f) 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.

ACKNOWLEDGEMENTS

The Board desires to place on record its appreciation of the services rendered by the employees of the Company during the year under review.

On behalf of the Board of Directors

Dr. Anant Narain Singh Chairman

Place : Mumbai Date : 7th May, 2015


Mar 31, 2013

The Directors hereby present the Forty Second Annual Report of the Company together with the Audited Statements of Account for the year ended 31st March, 2013.

OPERATING AND FINANCIAL RESULTS

(Rs./Lacs) (Rs./Lacs) 2012-13 2011-12

Income 3984.62 3519.50

Gross Profit for the Year 1434.34 1132.30

Less: Depreciation 180.51 170.72

Profit before tax 1253.83 961.58

Less: Provision for tax:

-Current Tax 397.51 286.25

-Deferred Tax (14.95) 17.94

-Earlier years Taxes 13.66 38.16

Net Profit 857.61 619.23

Add: Balance brought forward from previous year 1065.58 988.09

Balance available for appropriations 1923.19 607.32

APPROPRIATIONS :

(a) A dividend @200% i.e. Rs. 20/- per equity share (previous year 160% i.e. Rs. 16/- per equity share) on 13,00,000 Equity Shares, which, if approved by the Shareholders at the Annual General Meeting to be held on Friday, 16th August, 2013 will be paid out of the provision for

dividend 260.00 208.00

(b) Tax on Dividend 44.00 33.74

(c) Amount transferred to General 100.00 300.00

(d) Balance carried forward 1519.00 1065.58

OPERATIONS

The Company has significantly improved its performance during the year registering 13% growth in revenues and 30% growth in Profit before Tax over the previous year. The Directors hope to sustain the standard of improvement in the performance during the current financial year. The work on the Hotel Project in Gondia, Maharashtra is in progress.

DIVIDEND

Your Directors recommend the payment of dividend @ 200% (previous year dividend @ 160%) per equity share involving distribution ofRs. 260.00 lacs.

PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A) OF THE COMPANIES ACT 1956

The Company had no employees during the year who were in receipt of remuneration aggregating to:

(a) Not less than Rs. 60.00 lacs for the year, if employed throughout the year, or

(b) Not less than Rs. 5.00 lacs per month, if employed for part of the year.

DIRECTORS

During the year under report, Mr. A.R. Gandhi and Mr. P.K. Mohankumar resigned from the Directorship of the Company with effect from 15th March, 2013 and 19th April, 2013 respectively. The Directors place on record their appreciation of the services rendered by Mr. Gandhi and Mr. P.K. Mohankumar during their tenure as Directors of the Company Mr. Prabhat Verma was appointed as an Additional Director of the Company by the Board of Directors vide Board Circular Resolution No. 1 of 2013-14 dated 19th April, 2013. In terms of Section 260 of the Companies Act, 1956 and Article 122 of the Articles of Association of the Company, Mr. Verma holds office upto the date of the Annual General Meeting of the Company. It is proposed to appoint Mr. Verma as Director of the Company at the ensuing Annual General Meeting. The Board of Directors commend his appointment.

In accordance with the Companies Act, 1956 and the Articles of Association of the Company, Mrs. Rukmani Devi, Dr. Anant Narain Singh and Mr. Raymond N. Bickson, Directors of the Company are liable to retire by rotation and being eligible seek reappointment.

SUBSIDIARY COMPANIES

The Company does not have any subsidiary company

AUDIT COMMITTEE

Mr. Shriraman, Mr. B.L. Passi and Mr. Prabhat Verma are the members of the Audit Committee.

CORPORATE GOVERNANCE

As required by Clause 49 of the Listing Agreement with the Stock Exchanges, the report on Management Discussion and Analysis, Corporate Governance as well as the Auditors'' Certificate regarding compliance of conditions of Corporate Governance, form part of the Annual Report.

AUDITORS

At the Annual General Meeting, the Members will be required to appoint the Auditors for the current year and fix their remuneration.

FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of the provisions of Section 217 (l)(e) of the Companies Act, 1956, read with Rule 2 of the Companies (Disclosure of Particulars in the Report of the Board ofDirectors) Rules, 1988, the information relating to foreign exchange earnings and outgo is furnished in Notes on Accounts (Refer Note Nos. 28,29 & 30).

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 217 (2AA) of the Companies Act, 1956, the Board of Directors, based on the representations received from the Operating Management, hereby confirms that

1. In the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

2. It has, in the selection of the accounting policies, consulted the Statutory Auditors and has applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2013 and of the profit of the Company for that period;

3. It has 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, to the best of their knowledge and ability. There are however, inherent limitations, which should be recognized while relying on any system of internal control and records;

4. It has prepared the annual accounts on a going concern basis.

ACKNOWLEDGEMENTS

The Board desires to place on record its appreciation of the services rendered by the employees of the Company during the year under review.

On behalf of the Board of Directors

Place : Gurgaon Dr. Anant Narain Singh

Date : IstMay, 2013 Chairman


Mar 31, 2012

The Directors hereby present the Forty First Annual Report of the Company together with the Audited Statements of Account for the year ended 31st March, 2012.

OPERATING AND FINANCIAL RESULTS

2011-12 2010-11 (Rs/Lacs) (Rs/Lacs)

Income 3519.50 2773.17

Gross Profit for the year 1132.30 895.16

Less: Depreciation 170.72 160.04

Less: Interest _ 1.77

Profit before tax 961.58 733.35

Less: Provision for tax

- Current Tax 286.25 216.89

-Deferred Tax 17.94 26.00

- Earlier years Taxes 38.15 -

Net Profit 619.23 490.46

Add: Balance brought forward from previous year 988.09 994.70

Balance available for appropriations 1607.32 1485.16

APPROPRIATIONS :

(a) A dividend @160% i.e. Rs. 16/- per equity share (previous year 130% i.e. Rs. 13 per equity share)on 13,00,000 Equity Shares, which, if approved by the Shareholders at the Annual General Meeting to be held on Monday, the 13th day of August, 2012 will be paid out of the provision for dividend. 208.00 169.00

(b) Tax on Dividend 33.74 28.07

(c) Amount transferred to General Reserve 300.00 300.00

(d) Balance carried forward 1,065.58 988.09

OPERATIONS

The Company has continued to improve its performance during the year under review with 27% growth in the revenues and 26% growth in Profit after Tax over the previous year. With steady growth expectations in the domestic tourism and foreign tourist arrivals and considering the overall economic and business scenario, your directors hope that the Company will continue the trend of improvement in the performance during the current financial year. The work on the Hotel project in Gondia, Maharashtra is progressing satisfactorily.

DIVIDEND

Your Directors recommend the payment of dividend @ 160% (previous year dividend @ 130%) per equity share involving distribution of ? 208.00 lacs.

PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956

The Company had no employees during the year who were in receipt of remuneration aggregating to:

(a) Not less than Rs. 60.00 lacs for the year, if employed throughout the year; or

(b) Not less than Rs. 5.00 lacs per month, if employed for part of the year.

DIRECTORS

During the year, Mr. D R Kaarthikeyan was appointed as an Additional Director of the Company on 17th October, 2011 In terms of Section 260 of the Companies Act 1956 and Article 122 of the Articles of Association of the Company, Mr. Kaarthikeyan holds the office upto the date of the Annual General Meeting of the Company. It is proposed to appoint Mr. Kaarthikeyan as Director of the Company at the ensuing Annual General Meeting. The Board of Directors commend his appointment.

In accordance with the Companies Act, 1956 and the Articles of Association of the Company, Mr. B L Passi, Mr. P K Mohankumar and Mr. Shriraman, Directors of the Company are liable to retire by rotation and being eligible seek reappointment.

STATUS OF COMPANY

Your Company became a subsidiary company of The Indian Hotels Company Ltd. (IHCL) during the year.

AUDIT COMMITTEE

Mr. Shriraman, Mr. B.L. Passi and Mr. P. K. Mohankumar are the members of the Audit Committee.

CORPORATE GOVERNANCE

As required by Clause 49 of the Listing Agreement with the Stock Exchanges, the report on Management Discussion and Analysis, Corporate Governance as well as the Auditor's Certificate regarding compliance of conditions of Corporate Governance, form part of the Annual Report.

AUDITORS

At the Annual General Meeting, the Members will be required to appoint the Auditors for the current year and fix their remuneration.

FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of the provisions of Section 217 (1)(e) of the Companies Act, 1956, read with Rule 2 of the Companies (Disclosure ofParticulars in the Report of the Board of Directors) Rules, 1988, the information relating to foreign exchange earnings and outgo is furnished at point No. 5 & 6 in the Note No. 22 to the financial Statements.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 217 (2AA) of the Companies Act, 1956, the Board of Directors, based on the representations received from the Operating Management, hereby confirms that :-

1. in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

2. it has, in the selection of the accounting policies, consulted the Statutory Auditors and has applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2012 and of the profit of the Company for that period;

3. it has 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, to the best of their knowledge and ability. There are however, inherent limitations, which should be recognized while relying on any system of internal control and records;

4. it has prepared the annual accounts on a going concern basis.

ACKNOWLEDGMENTS

The Board desires to place on record its appreciation of the services rendered by the employees of the Company during the year under review.

On behalf of the Board of Directors

Place : Mumbai Dr. Anant Narain Singh

Date : 3rd May, 2012 Chairman


Mar 31, 2011

To the Members

The Directors hereby present the Fortieth Annual Report of the Company together with the Audited Statements of Account for the year ended 31st March, 2011.

OPERATING AND FINANCIAL RESULTS 2010-11 2009-10 (Rs./Lacs) (Rs./Lacs)

Income 2,773.17 2,347.19

Gross Profit for the year 893.38 711.50

Less: Depreciation 160.03 153.20

Profit before tax 733.35 558.30

Less: Provision for tax

- Current Tax 216.89 151.63

- Deferred Tax 26.00 29.71

Net Profit 490.46 376.96

Add: Balance brought forward from previous year 994.70 852.81

Balance available for appropriations 1,485.16 1,229.77

APPROPRIATIONS :

(a) A dividend @130% i.e. Rs. 13/- per equity share (previous year 130% i.e. Rs. 13 per share) on 13,00,000 Equity Shares, which, if approved by the Shareholders at the Annual General Meeting to be held on Wednesday, the 10th day of August, 2011 will be paid out of the provision for dividend 169.00 169.00

(b) Tax on Dividend 28.07 28.07

(c) Amount transferred to General Reserve 300.00 38.00

(d) Balance carried forward 988.09 994.70

OPERATIONS

The Company improved its performance during the year under review consequent to the improvement in the global economy which also contributed to gradual recovery in the hospitality sector and control over costs. The Directors hope that the trend of improvement in performance would continue during the current financial year. The Company is also in the process of setting up a hotel in Gondia, Maharashtra.

DIVIDEND

Your Directors recommend the payment of dividend @ 130% (previous year dividend @ 130%) per equity share involving distribution of Rs. 169.00 lacs.

SECRETARIAL COMPLIANCE

In terms of Section 383A of the Companies Act, 1956, the Company has obtained the Secretarial Compliance Certificate from a Practising Company Secretary. A copy of the said Certificate is attached to this Report.

PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956

The Company had no employees during the year who were in receipt of remuneration aggregating to :

(a) Not less than Rs. 60.00 lacs for the year, if employed throughout the year; or

(b) Not less than Rs. 5.00 lacs per month, if employed for part of the year.

DIRECTORS

During the year under report, Mr. P. Sanker and Ms. Deepa Misra Harris, Directors resigned from the directorship of the Company on 19th August, 2010 and 15th October, 2010 respectively. The Directors place on record their appreciation of the services rendered by Mr. Sanker and Ms. Harris during their tenure as Director of the Company.

In accordance with the Companies Act, 1956 and the Articles of Association of the Company, Dr. Anant Narain Singh, Mr. Raymond N. Bickson and Mr. A.R. Gandhi, Directors of the Company are liable to retire by rotation and being eligible seek reappointment.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956, the Board of Directors, based on the representations received from the Operating Management, hereby confirms that

1. in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

2. it has, in the selection of the accounting policies, consulted the Statutory Auditors and has applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2011 and of the profit of the Company for that period;

3. it has 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, to the best of their knowledge and ability. There are however, inherent limitations, which should be recognized while relying on any system of internal control and records; and

4. it has prepared the annual accounts on a going concern basis.

AUDIT COMMITTEE

Mr. Shriraman, Mr. B.L. Passi and Mr. P.K. Mohankumar are the members of the Audit Committee. Mr. Mohankumar was appointed as a Member of the Audit Committee vice Mr. P. Sanker consequent to his resignation from the directorship of the Company.

CORPORATE GOVERNANCE

Consequent to the Net Worth of the Company exceeding Rs. 25 crores for the first time in the history of the Company as at the end of the financial year 2010-11, Clause 49 of the Listing Agreement with the Stock Exchange/s regarding Corporate Governance has become applicable to the Company from the financial year 2011-12. Accordingly, the Company shall comply with the provisions of Clause 49 in the course of the current financial year.

AUDITORS

At the Annual General Meeting, the Members will be required to appoint the Auditors for the current year and fix their remuneration.

FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of the provisions of Section 217 (l)(e) of the Companies Act, 1956, read with Rule 2 of the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988, your Directors wish to inform you that electricity, diesel, petrol, and cooking gas are purchased at the prevailing market rates from the government agencies at Varanasi. The generation of electricity is required to supplement the power supply from the Electricity Boards/Agencies.

The activities of the Company are not covered under the list of specified industries in the Schedule to the Rules as stated above.

The information relating to foreign exchange earnings and outgo is furnished at point No. 4 & 5 in the Notes on Accounts.

ACKNOWLEDGEMENTS

The Board desires to place on record its appreciation of the services rendered by the employees of the Company during the year under review.

On behalf of the Board of Directors

DR. ANANT NARAIN SINGH Chairman

Place : Mumbai Date : 2nd May, 2011


Mar 31, 2010

The Directors hereby present the Thirty Ninth Annual Report of the Company together with the Audited Statements of Account for the year ended 31st March, 2010.

OPERATING AND FINANCIAL RESULTS 2009-10 2008-09 (Rs./Lacs) (Rs./Lacs)

Income................................ 347.19 2,044.15

Gross Profit for the year ............. 711.50 601.37

Less: Depreciation.................... 153.20 109.56

Profit before tax...................... 558.30 491.81

Less: Provision for tax

-Current Tax ......................... 151.63 156.76

-Deferred Tax.......................... 29.71 11.53

- Fringe Benefit Tax .................. -- 1.75

Net Profit............................. 376.96 321.77

Add: Balance brought forward from previous year.................. 852.81 695.33

Balance available for appropriations...... 1,229.77 1,017.10

APPROPRIATIONS:

(a) A dividend @130% i.e. Rs. 13/- per equity share (previous year 85% i.e. Rs. 8.50 per share) on 13,00,000 Equity Shares, which, if approved by the Shareholders at the Annual General Meeting to be held on Friday, 13th August, 2010 will be paid out of the provision for dividend............................. 169.00 110.50

(b) Tax on Dividend................... 28.07 18.78

(c) Amount transferred to General Reserve.......................... 38.00 35.00

(d)Balance carried forward............ 994.70 852.81

OPERATIONS

The impact of the global economic slowdown and the travel advisories on swine flue scare adversely impacted the business during the first half of the financial year. However, the improvement in the global economy in the second half of the financial year and the addition of Nadesar Palace enabled the Company to register an improved performance over the previous year. The Directors hope that with the return of the normalcy in the global economic scenario, the business would further improve in the current financial year.

DIVIDEND

Your Directors recommend the payment of dividend @ 130% (previous year dividend @ 85%) per equity share involving distribution of Rs. 169.00 lacs.

SECRETARIAL COMPLIANCE

In terms of Section 383A of the Companies Act, 1956, the Company has obtained the Secretarial Compliance Certificate from a Practising Company Secretary. A copy of the said Certificate is attached to this Report.

PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956

The Company had no employees during the year who were in receipt of remuneration aggregating to :

(a) Not less than Rs. 24.00 lacs for the year, if employed throughout the year; or

(b) Not less than Rs. 2.00 lacs per month, if employed for part of the year.

DIRECTORS

In accordance with the Companies Act, 1956 and the Articles of Association of the Company, Mr. Shriraman, Mrs. Rukmani Devi and Ms. Deepa Misra Harris, Directors of the Company are liable to retire by rotation and being eligible seek reappointment.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956, the Board of Directors, based on the representations received from the Operating Management, hereby confirms that

1. in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

2. it has, in the selection of the accounting policies, consulted the Statutory Auditors and has applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2010 and of the profit of the Company for that period;

3. it has 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, to the best of their knowledge and ability. There are however, inherent limitations, which should be recognized while relying on any system of internal control and records; and

4. it has prepared the annual accounts on a going concern basis.

AUDIT COMMITTEE

Mr. Shriraman, Mr. B.L. Passi and Mr. P. Sanker are the members of the Audit Committee.

AUDITORS

At the Annual General Meeting, the Members will be required to appoint the Auditors for the current year and fix their remuneration.

FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of the provisions of Section 217 (l)(e) of the Companies Act, 1956, read with Rule 2 of the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988, the information relating to foreign exchange earnings and outgo is furnished at point No. 4 & 5 in the Notes on Accounts.

ACKNOWLEDGEMENTS

The Board desires to place on record its appreciation of the services rendered by the employees of the Company during the year under review.

On behalf of the Board of Directors

DR. ANANT NARAIN SINGH Chairman

Place : Mumbai

Date : 10th May, 2010



 
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