Mar 31, 2015
Potential Investments and Finance Limited
The Directors have pleasure in presenting the Annual Report on the business and operations of the Company together with the Audited Financial Statements for the year ended 31st March, 2015.
The summarized financial results of your Company are given in the table below:
(Figures in Rs.) Particulars F.Y 2014-15 F.Y 2013-14
1. Operative & Other Income 601,825,289.00 498,071,870.00
2. Depreciation 88,172.00 73,108.00
3. Profit/loss before tax 933,081.00 7,279,114.00
4. Profit after tax 2,651,243.00 5,257,424.00
5. Add previous year's balance (7,616,740.00) (12,874,164.00)
6. Balance carried to balance sheet (5,308,106.00) (7,616,740.00)
Keeping in view the performance we are unable to recommend dividend for the year under review. Overview
The improvement has been achieved by the Company during the financial year. The Company earned its income mainly from marketing and distribution of steel products. The Company continues to reducing cost of borrowings, finding new markets, etc. We extended our geographical reach to the end users.
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 Agreement with the Stock Exchanges in India, is presented in a separate section forming part of the Annual Report.
Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014. Accordingly, there are no unclaimed or unpaid deposits lying with the Company for the year under review.
Details of significant and Material Orders passed by the Regulators, Courts and Tribunal No significant and material order has been passed by the Regulators, Courts and Tribunals impacting the going concern status and Company's operations in future.
Change in the nature of business, if any
There was no Change in the nature of business of the Company during the Financial Year ended March 31, 2015. The Board at their meeting held on 15.10.2014, approved the alteration of Main objects of Memorandum of Association of the Company and the alterations are in the nature of additions and consolidation of the current clauses and that the scope of the existing clauses remained as before.
Material changes and commitments, if any, affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report
There are no material changes and commitments, affecting the financial position of the Company occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report other than those disclosed in the financial statements.
The Board of Directors in its meeting held on October 15, 2015 approved the alteration in the Memorandum of Association of the Company (MOA) in respect of Main Objects and sub-division of nominal value of equity share from Rs. 10/- each to Rs. 2/- each, subject to the approval of the shareholders. The alterations were approved by the shareholders vide a special resolution passed through Postal Ballot on November 27, 2014.
Directors Responsibility Statement
Pursuant to the Section 134 (1) (c) of the Companies Act, 2013, the Directors to the best of their knowledge hereby state and confirm that:
a) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanations 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 at end the of the financial year and of the profits of the Company for the period.
c) The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
d) The annual accounts have been prepared on a going concern basis.
e) The internal financial controls to be followed by the Company were laid down and such internal financial controls were 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.
Explanations or Comments by the Board on every Qualification, Reservation or Adverse Remark
The Explanations for the observations mentioned in Secretarial Audit Report issued by the Rashi Sehgal & Associates, Practicing Company Secretaries, that the Company did not take the approval of Registrar of Companies (ROC) by filing Form INC 24 with respect to change of name of the Company from "Potential Investments and Finance Limited" to "Mahabir Infraheights Limited" - The Management decides to continue with the existing name only.
Your Company upholds the standards of governance and is compliant with the Corporate Governance provisions as stipulated in Clause 49 of the Listing Agreement in both letter and spirit during the period under review. Your Company lays strong emphasis on transparency, disclosure and independent supervision to increase various stakeholders' value.
The Company has complied with the Corporate Governance as stipulated under Clause 49 of the Listing Agreement with Stock Exchanges. A separate section on Corporate Governance, along with certificate from Statutory Auditors confirming compliance with the requirements of Clause 49 of the Listing Agreement with the BSE Limited (BSE), are annexed as Annexure "F" and forming part of the Annual Report.
Particulars of Contracts and Arrangements with Related Parties
Pursuant to the provisions of Section 134 of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014, the particulars of all contracts / arrangements / transactions entered into by the Company with related parties during the financial year are in the ordinary course of business and on arm's length basis. During the year, the Company had not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the policy of the Company on related party transactions and materiality of related party transactions.
Your Directors draw attention of the members to Note 21 to the Financial Statement which sets out related party disclosures. The particulars of contracts and arrangements entered into by the company with related parties referred to in Section 188 in Form AOC-2 is attached herewith as Annexure-B.
Details in respect of adequacy of Internal Financial Controls with reference to the Financial Statements
The Company has a robust and comprehensive Internal Financial Control System commensurate with the size, scale and complexity of its operations. The objective of these procedures is to ensure efficient use and protection of the Company's resources, accuracy in financial reporting and procedures. The system encompasses the major processes to ensure reliability of financial reporting, compliance with the policies, procedures, laws and regulations safeguarding assets and economical and efficient use of resources. The policies and procedures adopted by the company ensure the orderly and efficient conduct of its business and adherence to the company's policies, prevention and detection of frauds and errors, accuracy and completeness of the records and timely preparation of reliable financial information.
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 of the Board and to the Chairman and Managing Director.
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 the Audit Committee of the Board.
Directors and Key Managerial Personnel
In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Manoj Gupta, retire by rotation at the ensuing Annual General Meeting and being eligible offer himself for reappointment.
The details of directors being recommended for appointment / re-appointment as required in clause 49 of the Listing Agreement are contained in the Notice convening the ensuing Annual General Meeting of the Company.
Appropriate resolution(s) seeking your approval to the appointment / re-appointment of Directors are also included in the Notice.
Declaration by Independent Director(s)
All the Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149 (6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of Listing Agreement, the Board has carried out an annual evaluation of its own performance, the Directors individually as well as the evaluation of the working of various Committees. The Independent Directors also carried out the evaluation of the Chairman and the Non-Independent Directors, the details of which covered in the Corporate Governance Report.
Criteria for Evaluation of Directors
For the purpose of proper evaluation, the Directors of the Company have been divided in 3 (three) categories i.e. Independent, Non-Independent and Non-Executive and Executive.
The criteria for evaluation includes factors such as engagement, strategic planning and vision, team spirit and consensus building, effective leadership, domain knowledge, management qualities, team work abilities, result/achievements, understanding and awareness, motivation/ commitment/ diligence, integrity/ ethics/ value and openness/ receptivity.
Number of Meetings of the Board of Directors
During the Financial year 2014-15, the Board of Directors of the Company met 9 times on 14th April, 2014, 5th June, 2014, 19th July, 2014, 13th August, 2014, 15th October, 2014, 12th November, 2014, 13th February, 2015 and 30th March, 2015.
During the Financial year 2014-15, meeting of the Audit Committee were held on 14th April, 2014, 13th August, 2014, 12th November, 2014 and 13th February, 2015. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under Companies Act, 2013.
The Audit Committee comprises three Directors, of which two are Non-Executive and Independent Directors. The Chairman of the Committee is a Non-Executive Independent Director.
Composition of the Audit Committee as on 31st March, 2015 is as under:
Name of the Director Category
Mr. Srichand Tekchand Gerela Non-Executive and Independent (Chairman)
Mr. Bharat Bhushan Sahny Non-Executive and Independent
Mr. Manoj Gupta Managing Director
Nomination and Remuneration Committee
In adherence of Section 178(1) of the Companies Act, 2013, the Board of Directors of the Company in its Meeting held on March 30, 2015, re-constitute the Committee, consisting of 3 Directors of which majority are Independent Directors.
Name of the Director Category
Mr. Bharat Bhushan Sahny Non-Executive and Independent (Chairman)
Mr. Srichand Tekchand Gerela Non-Executive and Independent
Ms. Ruta Jindal Non-Executive Director
Details of establishment of Vigil Mechanism for Directors and Employees
In Compliance with the provision of Section 177(9) of the Companies Act, 2013 and Clause 49 of the listing Agreement, the Company has framed a vigil mechanism/Whistle Blower Policy to deal with the ethical behavior, actual or suspected fraud or violation of the Company's code of conduct or ethics policy, 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.
The 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. The Vigil Mechanism is adopted by the Board of Directors on their meeting held on August 13, 2015.
Auditors and Auditor's Report
A. Statutory Auditors: M/s VAPS & Co., Chartered Accountants, Auditors of the Company, retire at the conclusion of the forthcoming Annual General Meeting and they have offered themselves for re- appointment. The certificate to the effect that if appointed would be within the prescribed limit under Section 141 of the Companies Act, 2013 has been obtained from them.
The observations of Statutory Auditors in their reports on financials are self-explanatory and therefore, do not call for any further comments under Section 134 of the Companies Act, 2013.
B. Secretarial Auditors: Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the Board had appointed M/s Rashi Sehgal & Associates, Company Secretaries, to conduct Secretarial Audit for Financial Year 2014-15. The Secretarial Audit Report for the Financial Year ended on 31st March, 2015 is annexed herewith marked as Annexure "C" to this Report. The Secretarial Audit Report is self- explanatory and therefore, do not call for any further comments.
Particulars of Loans, Guarantees or Investments under Section 186 of the Companies Act, 2013
The company has given Loans / given any guarantee or provide any security in connection with a loan to any other body corporate under Section 186 of the Companies Act, 2013 during the Financial Year 2014-15, which are given under respective head and the same is furnished in the notes to the Financial Statement.
The paid up equity share capital as on 31st March, 2015 was Rs. 37,000,000. The company has not issued shares with differential voting rights nor granted stock options nor sweat equity or bonus shares.
The Board meeting held on 15.10.2014, the Company has sub-divided each equity share of the nominal value of Rs. 10/- each fully paid up into 5 equity shares of Rs. 2/- each fully paid up and all the equity shares of Rs. 10/- each be sub divided accordingly.
Extract of the Annual Return
The details forming part of the extract of the Annual Return in Form no. MGT-9 as required under Section 92 of the Companies Act, 2013 is annexed hereto as Annexure-"A" and forms part of the Director's Report.
Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo
Information pertaining to conservation of energy, technology absorption, foreign exchange earnings and outgo as required under Section 134 (3) (m) of Companies Act, 2013 read with the Rule 8 (3) of the Companies (Accounts) Rules, 2014, is annexed hereto as Annexure "E", forming part of this Report.
Particulars of Employees and related disclosures
Details pursuant to Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 form part of this Annual Report and annexed herewith as Annexure "D".
Disclosure as per Sexual Harassment of women at workplace (Prevention, Prohibition and Redressal) Act, 2013
The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed there under. No complaint has been received for sexual harassment of women at work place by the Company during the financial year 2014-15.
Transfer to Investor Education and Protection Fund
Pursuant to the provisions of Section 125 (2) (c) of the Companies Act, 2013, the Company is not required to transfer any amount, during the financial year 2014-15 to the Investor Education and Protection Fund.
The Board places on record its appreciation for the continued co-operation and support extended to the Company by customers, vendors, bankers, rating agencies, stock exchanges, depositories, auditors, legal advisors, consultants business associates, state government, local bodies and all the employees with whose help, co operation and hard work the Company is able to achieve the results.
The Board deeply acknowledges the trust and confidence placed by the customers of the Company and all its shareholders.
By the Order of the Board Potential Investments and finance Limited
Place: New Delhi Manoj Gupta Date: 02.09.2015 Managing Director
Mar 31, 2014
The Directors hereby present their Annual Report on the bus.ness and operations of the Company together wit the Audited Financial Accounts for the year ended 31st March 2014.
The financial results of the Company for the year under report are given below:
Particulars Year ended 31st Year ended 31st March,2014 March, 2013
1. Operative & Other Income 499,209,355 65,926,045
2. Depreciation 73,107 77,398
3. Profit/loss before tax 7,279,114 383.376
4 Profit after tax 5,257,424 383,377
5 Add previous year''s balance (12,874,164) (13,257,541)
6. Balance carried to balance sheet (7,616,740) 12,874,164)
Keeping in view the performance we are unable to recommend dividend for the year under review OPERATIONS
Your directors who are having vast experience In steel sector started the business of trading and distribution of Iron and steel products like, TMT bars, rolled products, billets, ingots and steel pipe and tubes successfully in the current year. The Company is running successfully and generated a revenue of approx. 50 Crores from the main operations.
There are no material changes affecting the affairs of the company, which have happened between the date of Balance Sheet and up to the date of this report,
MANAGEMENT DISCUSSION & ANALYSIS (M D&A)
The company earned its income mainly from marketing and distribution of steel products.
The economic development is the main agenda of the Government and that will provide very positive environment for the business of Trading and Manufacturing.
RISKS AND CONCERNS
Your Company is slightly exposed to business and environmental risks in which it operates including economic cycles, market risks and credit policy of government We are managing these risks by maintaining a conservative financial profile and by following prudent business and management practices.
ADEQUATE INTERNAL CONTROL
Your Company has a proper and adequate system of internal controls to ensure that all activities are monitored and controlled against any unauthorized use or disposition of assets and that the transactions are authorized, recorded and reported correctly
Mr. Vijay Kumar and Mr. Manoj Gupta are liable to retire by rotation. Mr. Bharat Bhushan Sahny & Mr. Srichand Teckchand Gerela has been appointed as additional Directors as on 28.02.2014 who hold office upto the date of this AGM.
The Company has in place a system of Corporate Governance. A separate report on Corporate Governance forming part of the Annual Report of the Company is annexed hereto. A certificate from the Statutory Auditors regarding compliance of conditions of Corporate Governance as stipulated under Corporate Governance Clause of the Listing Agreement is annexed to the report on Corporate Governance.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956, the Directors confirm that: i) In the preparation of the annual accounts, the applicable accounting standards have been followed;
11) Appropriate accounting policies have been selected and applied consistently and have 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 311 March, 2014 and of the profits of the Company for the period from l" April, 2013 to 31" March, 2014;
ill) Proper and sufficient care has been taken 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) The annual accounts have been prepared on a going concern basis.
During the period under review, the Company has not accepted any deposits within the meaning of Section 58A of the Companies Act, 1956 and the Rules made there under
M/s VAPS & Co., Chartered Accountants, Auditors of the Company, retire at the conclusion of the forthcoming Annual General Meeting and they have offered themselves for re-appointment. The Company has obtained necessary certificate u/s 139(1) of the Act from M/s VAPS & Co., Chartered Accountants.
The Auditors'' Report on the Accounts of the Company for the period under review is self - explanatory. PARTICULARS OF EMPLOYEES
During the period under review, no employee received salary more than Rs. 60.00 lac per annum or Rs.5.00 lac per month. Accordingly no particulars of employees are being given pursuant to the provisions of Section
217(2A) of the Companies Act. 1956
CONSEVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Information pursuant to section 217(l)(e) of the Companies Act, 1956 read with Companies (disclosures of particulars in the report of Board of Directors) Rules 1988, particulars with respect to conservation of Energy, Technology Absorption, Foreign Exchange Earning & Outgo are annexed hereto and form part of this report
Yout Directors are pleased to place on record their sincere gratitude to the government, bankers and business constituents for their continued and valuable co-operation and support to the Company. The Board also takes this opportunity to express their appreciation for the devoted and sincere services rendered by the employees of the Company during the year.
By Order of the Board For Potential Investments and Finance Limited CIN:L67120DL1983PLC14972
sd/- sd/- Place: Delhi (Manoj Gupta) (Vijay Kumar) Date: 14.04.2014 Director Director