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Directors Report of Frontier Capital Ltd.

Mar 31, 2014

The Members of Frontier Leasing & Finance Limited

Mumbai

The Directors have pleasure in presenting the Thirtieth Annual Report of the Company and the Audited Statements of Accounts for the Financial Year (FY) ended 31st March, 2014.

1. Financial Results: Amt (in Rs.)

Particulars For the Year For the Year ended on 31st ended on 31st March, 2014 March, 2013

Income 3.04.07.381 1,86,92,242

Less: Expenses 1.41.56,440 37,43,996

Profit / (Loss) 1,62,50,941 1,49,48,246 before tax_

Less: Provision for Taxation Current Tax Deferred Tax (60,04,000) (57,10,459) 13.336 26,192

Profit / (loss) 1,02,60,277 92,63,979 After Taxation

Less: Proposed 2,45,000 2,45,000 Dividend_

Less: Corporate 41,638 41,638 Dividend Tax

Less: Transfer to 20,52,055 18,52,796 Statutory Reserve_

Add: Balance 2,25,96,865 1,54,72,320 Brought Forward from Last Year

Balance Carried 3,05,18,449 2,25,96,865 Forward to Balance Sheet



2. Operations

Your Company continues to be profitable, dividend paying and debt free for the last three years. Profit after tax was 0.92 Crore and 1.23 Crore for Financial Year 2013 and 2012 respectively. In Financial Year 2014 total Income stood to Rs. 3.04 Crore with Profit after tax of Rs. 1.02 Crore. Key Highlights:-

- As on 30th June 14, the Assets under Management stood at Rs. 23.34 Crores with Gross NPA and Net NPA at 0%.

- During the year, the Company has built a Bill Discounting portfolio of Rs. 12.24 Crores and Corporate Loan of Rs. 6.2 Crores as of 30th June 14.

3. Dividend

Your Directors are pleased to recommend a Dividend of Rs 1/- Per Equity share of Rs 10/- each for the Year end 31st March, 2014. The Dividend if approved at the forthcoming Annual General Meeting will be paid out of the profits of the Company. The Dividend will be paid to those shareholders whose name appear on the Register of the Members of the Company after giving effect to all the valid transfers lodged with the share transfer agent on or before the 9th September, 2014 and to those whose name appear as beneficial owners in the records of National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) as on the said date. After considering the Company''s profitability as well as working capital requirement for its growth plans, your directors are pleased to recommend a final dividend at the rate of 10% i.e. Re. 1/- per equity share. The dividend will be declared in the ensuing Annual General Meeting based on approval by the Shareholders.

4. Public Deposit: m

Your company has not accepted any

Deposits during the Year. Hence the provisions of Section 58A of the Companies Act, 1956 or Section 73 & 74 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 1975 and. Companies (Acceptance of Deposits) Rules, 2014 are not applicable to the Company.

Companies (Acceptance of Deposits) Rules, 2014 are not applicable to the Company. 5. Auditors:

M/s. Nisar & Kumar, Chartered Accountants, retire at the conclusion of the ensuing Annual General Meeting. They have been Statutory Auditors of the Company since Financial Year 2008 i.e for a continuous period of 4 years including Financial Year 2014. In terms of the Companies Act, 2013 ("the new Act") and the Rules framed thereunder, it is proposed to appoint them as Statutory Auditors of the Company to hold office from the conclusion of the Annual General Meeting, until the conclusion of the 31st Annual General Meeting of the Company to be held in the Year 2017 (subject to ratification of their appointment by the Members at every Annual General Meeting held after the ensuing Annual General Meeting).

As required under the provisions of Section 139 (1) of the new Act, the company has received a written consent from M/s Nisar & Kumar, Chartered Accountants to their appointment and a Certificate, to the effect that their re-appointment, if made, would be in accordance with the new Act and Rules framed thereunder and that they satisfy the criteria provided in Section 141 of the new Act.

The Members are requested to elect Auditors as aforesaid and fix their remuneration.

6. Directors:

A] During the year, the following Directors resigned from the Board of FLFL.

Sr. Name of DIN No. Designation Date of No the Resignation Director

1 Mr. 00023081 Non- 5th August, Manish Executive 2014 Kedia Director

2 Mr. 00055499 Non- 5th August, Narottam Executive 2014 Babulal Diretor Vyas

3 Mr. Sridhar 00004272 Independent 30th June, Srinivasan Director 2014

The Board extends its sincere appreciation to Mr. Sridhar Srinivasan, Mr. Manish Kedia and Mr. Narottam Babulal Vyas for their valuable guidance and support provided during their tenure as Directors in the Company.

B] In accordance with the provisions of Section 149 of the Companies Act, 2013 and the Rules made thereunder, which came into effect from April 1, 2014, approval of the Members will be sought at the ensuing Annual General Meeting of the Company for formalizing the appointment of Mr. V.G Raghavan, Mr. Sridhar Srinivasan and Mr. Rajesh Kathuria as Independent Directors of the Company, liable to retire by rotation, for a term until September, 2017.

7. Subsidiary Company:

A wholly owned subsidiary of the Company named "Frontier Digital Technologies Private Limited'' (FDTPL) was incorporated on 21st March, 2014. A statement containing brief financial details of FDTPL for the year ended March 31, 2014 is included in the Annual Report.

8. Compliance:

The Company is registered with RBI as an Asset Financing Non Deposit Accepting NBFC. The Company has complied with and continues to comply with the applicable Regulations and Directions of the RBI and it does not carry on any activities other than those specifically permitted by the RBI.

9. Director''s Responsibility Statement:

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956 the Directors, based on the representation received from the Operating management, confirm that:

(i) in the preparation of the annual accounts for the financial period ended 31st March, 2014,the applicable accounting standards have been followed and there are no material departures.

(ii) they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2014 and of the profit of the Company for the year ended on that date;

(iii) 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.

10. Consolidated Financial Statements

The Consolidated Financial Statements of the Company and its subsidiary "FDTPL", prepared in accordance with Accounting Standard AS 21 form part of this Annual Report. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiary Company FDTPL.

11. Corporate Governance Report:

With the introduction of the new Companies Act, 2013 and the issue of SEBI circular no. CIR/CFD/POLICY CELL/2/2014 dated April 17, 2014, the provisions of amended Clause 49 of the Listing Agreement related to the corporate governance would be applicable to the Company with effect from 1st October, 2014. However, as a measure of good governance, the Company complies with most of the requirements specified under Clause 49.

A summary of the Corporate Governance measures adopted by the Company is given below:-

i. The Company recognizes its role as a corporate citizen and endeavors to adopt the best practices and the highest standards of corporate governance through transparency in business ethics, accountability to its customers, government and others.

ii. The Company believes that good corporate governance practices enable the management to direct and control the affairs of the Company in an efficient manner and to achieve the Company''s goal of maximizing value for all its stakeholders.

iii. The Board of Directors along with its Committees provides leadership and guidance to the Company''s management and directs, supervises and controls the activities of the Company.

iv. The size of the Board is commensurate with the size and business of the Company. At present, the Board comprises of Mr. V.G Raghavan, Mr. Sridhar Srinivasan, Mr. Sandeep Soni and Mr. Rajesh Kathuria. Mr. V G Raghavan, Mr. Sridhar Srinivasan & Mr. Rajesh Kathuria are the Non - Executive Independent Directors of the Company and Mr. Sandeep Soni is the Executive, Whole Time Director of the Company.

v. Mr. Sandeep Soni was re-appointed as the Whole time Executive Director of the Company for a period of 5 years commencing 1st April, 2014.

It was decided at the Nomination and Remuneration Committee Meeting held on 25th March, 2014 and at a Board Meeting held on the same day, to pay Remuneration of INR 3 lakhs per month with effect from 1st April, 2014.

vi. The Board has constituted Committees with specific terms of reference to focus on specific issues and ensure expedient resolution of diverse matters. These include the Audit Committee, Nomination & Remuneration Committee & Independent Directors Committee.

vii. The Audit Committee, Nomination and Remuneration Committee and the Independent Directors Committee was constituted comprising three Non-Executive (NE) Independent Directors viz. Mr. V.G Raghavan, Mr. Sridhar Srinivasan and Mr. Rajesh Kathuria.

viii. Minutes of Meetings of all Committees of the Board are placed before the Board for discussion/noting. A quarterly summary of the minutes of the meetings of the Boards of the Company''s subsidiary FDTPL is also placed before the Board for noting.

ix. During the year, Ms. Neha Sanghavi, Associate Member of The Institute of Company Secretaries of India, was appointed as the Company Secretary and Compliance Officer of the Company. The Company Secretary is also the Secretary of all the aforementioned Committees.

x. The Company, Directors (including the Independent Directors) and its employees have adopted the Code of Conduct and the same has been posted on the Company''s website.

xi. The Company has adopted a Whistle - Blower Policy which provides a formal mechanism for all employees of the Company to make protected disclosures to the management about unethical behavior, actual or suspected fraud or violation of the Company''s Code of Conduct. No employee of the Company has been denied access to the Audit Committee.

xii. The Company''s website is www.flflindia.com

12. Accounts and Accounting Standards

The Company adheres to the Accounting Standards notified under the Companies (Accounting Standard) Rules, 2006 in the preparation of its financial statements and also to the guidelines prescribed by the RBI.

13. Conservation of energy, technology absorption, foreign exchange earnings and outgo:

Information pertaining to section 217(1) (e) of the Companies Act, 1956 & 134 (3)(m) of the Companies Act, 2013 read with the Companies (Disclosure of Particulars in the Report of Directors) Rules, 1988 and Companies (accounts) Rules, 2014 with respect to conservation of energy, technology absorption may be treated as NIL since your Company is not a manufacturing Company.

During the year under review, the Company had NIL foreign exchange earnings (Previous Year: NIL) and outgo (Previous Year: NIL)

14. Particulars of Employees:

The disclosures as required under Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 as amended, is not required as there are no employees covered by it.

15. Disclosures:

The Company has made adequate disclosures regarding related party transactions, contingent liabilities, and significant accounting policy in the Notes to Accounts as an integral part of the Balance Sheet and Profit & Loss Accounts.

16. Stock Exchanges - Compliance of Listing Agreements

The Company''s shares are listed at The Bombay Stock Exchange and the Company has paid the listing fees to the Stock Exchange. Further, the Company has demat connectivity with both the Depositories, NSDL and CDSL and paid Annual Fees to both the Depositories.

17. Green Initiative

Section 136 of the Companies Act, 2013 and the Rules made there under allow the Company to send its financial statements by electronic mode to such members whose shareholding is in dematerialized format and whose email addresses are registered with Depository for communication purposes. As a responsible corporate citizen, the Company proposes to effect electronic delivery of the Annual Report of the Company in lieu of the paper form to the Members who have registered their email IDs with the Depositories. However, as a matter of practice, a physical copy of the Annual Report has also been sent to the members at their address registered with the Company and the Depository Participants.

A copy of this Annual Report along with the Annual Report of each of the Company''s subsidiaries for FY 2013-14 is also available on the website of the Company viz. www .flflindia. com

18. Acknowledgement:

The Directors would like to place on record their gratitude for the valuable guidance and support received from the Reserve Bank of India, Securities and Exchange Board of India, Bombay Stock Exchange Limited and other Government and Regulatory Authorities and convey their appreciation to all the stakeholders, customers, bankers, lenders, vendors and all business associated for their valuable and continuous support and encouragement towards the conduct of the efficient operations of the company.

By order of the Board

Sd/- Sd/- Mr. Sandeep Soni Mr. Rajesh Kathuria Director Director

Date: 11th August, 2014 Place: Mumbai


Mar 31, 2013

Dear Shareholders,

The Directors take pleasure in presenting the Twenty Ninth Annual Report of the Company, together with the Audited Accounts thereon for the year ended 31st March, 2013.

1. Financial Results:

( Amounts in INR)

Particulars For the Year For the Year ended on 31st ended on 31st March, 2013 March, 2012

Income 1,86,92,242 2,64,02,894

Less: Expenses 37,43,996 73,37,101

Profit / (Loss) before tax 1,49,48,246 1,90,65,793

Less: Provision for Taxation

- Current Tax (57,10,459) (67,67,305)

- Deferred Tax 26,192 43,267

Profit / (loss) After Taxation 92,63,979 1,23,41,755

Less: Proposed Dividend 2,45,000 2,45,000

Less: Corporate Dividend Tax 41,638 39,745

Less: Transfer to Statutory Reserve 18,52,796 24,68,351

Add: Balance Brought Forward from Last 1,54,72,320 58,83,661 Year

Balance Carried Forward to Balance Sheet 2,25,96,865 1,54,72,320

2. Operations:

Your Company continues to be profitable, dividend paying and debt free since the last three years. Profit after tax was Rs. 0.52 Crore and Rs. 1.23 Crore for Financial Year 2011 and 2012 respectively. In Financial Year 2013 total Income stood to Rs. 1.87 Crore with Profit after tax of Rs. 0.93 Crore. As on 30th June 13, the Assets under Management stood at Rs. 17.7 crore with Gross NPA and Net NPA at 0%.

During the year, the Company also successfully diversified into Bill Discounting as a product line and has built a portfolio of Rs.6.5 crore as of 30th June 13.

With plans to grow the business, the company is meaningfully engaged with few large banks to raise bank credit. In this regard the company also secured External Credit Ratings of BBB- (Investment Grade) from Brickworks Ratings and Asset Finance Classification a credit rating agency recognised by Reserve Bank of India.

The company continues to be fully compliant to various regulatory requirements and bodies (viz. RBI, BSE, SEBI etc)

3. Dividend:

Your Directors are pleased to recommend a Dividend of Rs 1/- Per Equity share (ie at the rate of 10%) of Rs 10/- each for the Year end 31st March, 2013. The Dividend if approved at the forthcoming Annual General Meeting will be paid out of the profits of the Company. The Dividend will be paid to those shareholders whose name appear on the Register of the Members of the Company after giving effect to all the valid transfers lodged with the share transfer agent on 16th September 2013 and to those whose name appear as beneficial owners in the records of National Securities Limited (NSDL) and Central Depository Limited (NSDL) as on the said date. The dividend will be declared in the ensuing Annual General Meeting based on approval by the Shareholders of item no 2 of the notice.

4. Public Deposit:

Your company has not accepted any Deposits during the Year. Hence the provisions of Section 58A of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 are not applicable to the Company.

5. Auditors:

M/s. Nisar & Kumar, Chartered Accountants, who are the Statutory Auditors of the company continue to hold the office until the conclusion of Annual General Meeting and offer themselves for re-appointment. The Company has received a certificate from them to the effect that the re-appointment if made will be within the limits prescribed under Section 224(1B) of the Companies Act, 1956.

6. Directors:

During the year, Mr. Srinivasan Sridhar & Mr. Rajesh Kathuria were appointed as Additional Directors of the Company. Now they are proposed to be appointed as Directors and the management of the Company welcomes them on board. They would act in the capacity of Independent & Non-Executive Directors of the Company.

Except the above, there has been no other change in the Board of Directors of your Company.

7. Subsidiary Company:

On February 14th 2012, your Company had acquired 100% stake in AMW Finance Limited. The Company has sold its entire shareholding held in the Subsidiary Company namely M/s. AMW Finance Limited for Rs. 5 lacs only (i.e. 50,000 equity shares at Rs. 10/- each). Accordingly, AMW Finance Limited ceases to be a subsidiary of Frontier Leasing & Finance Limited with effect from July 08, 2013. (Refer to 212 statement annexed)

8. Corporate Governance Report:

The provisions related to the corporate governance pursuant to Clause 49 of the Listing Agreement are not applicable to the Company. However, as a measure of good governance, the Company complies with most of the requirements specified under Clause 49.

9. Director''s Responsibility Statement:

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956 your Directors state:

- that in the preparation of the annual accounts for the financial period ended 31st March, 2013, the applicable accounting standards had been followed along with proper explanation relating to material departures;

- that the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year under review;

- 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;

- That the Directors had prepared the accounts for the financial period ended 31st March, 2013 on a going concern basis.

10. Conservation of energy, technology absorption, foreign exchange earnings and outgo:

Information pertaining to section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Directors) Rules, 1988 with respect to conservation of energy, technology absorption may be treated as NIL since your Company is not a manufacturing Company. As regards Foreign Exchange earnings, the Board wishes to state that there has been no inflow or outflow of foreign exchange earnings.

11. Particulars of Employees:

The disclosures as required under Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 as amended, is not required as there are no employees covered by it.

12. Disclosures:

The Company has made adequate disclosures regarding related party transactions, contingent liabilities, and significant accounting policy in the Notes to Accounts as an integral part of the Balance Sheet and Profit & Loss Accounts.

13. Stock Exchanges – Compliance of Listing Agreements:

The Company''s shares are listed at The Bombay Stock Exchange and the Company has paid the listing fees to the Stock Exchange. Further, the Company has demat connectivity with both the Depositories, NSDL and CDSL and paid Annual Fees to both the Depositories.

14. Acknowledgement:

The Board wishes to acknowledge and thank all the stakeholders for their valuable support and encouragement towards the conduct of the efficient operations of the company and would also place on record their gratitude for the co-operation and assistance received from the RBI and various departments of Central and State Governments and thank them for their continued cooperation and support.

By order of the Board

Mr. V.G. Raghavan

(Director)

Mr. Sandeep Soni

(Director)

Date: 8th August, 2013

Registered Office:

7th Floor, Tower 1,

Equinox Business Park,

Peninsula Techno Park, Off

Bandra Kurla Complex, LBS

Marg, Kurla (West), 400070


Mar 31, 2012

The Directors take pleasure in presenting the Twenty Eighth Annual Report of the Company, together with the Audited Accounts thereon for the year ended 31st March, 2012.

1. Financial Results:

(Amt in Rs.)

Particulars For the Year For the Year ended on 31st ended on 31st March, 2012 March, 2011

Income 2,64,02,894 1,21,83,504

Less: Expenses 73,37,101 35,91,618

Profit/(Loss) before tax 1,90,65,793 85,91,886

Less: Provision for Taxation

- Current Tax (67,67,305) (31,10,000)

- Deferred Tax 43,267 (2,92,509)

Profit/(loss) After Taxation 1,23,41,755 51,89,377

Less: Proposed Dividend 2,45,000 2,45,000

Less: Corporate Dividend Tax 39,745 39,745

Less: Transfer to Statutory Reserve 24,68,351 10,37,875

Add: Balance Brought Forward from Last Year 58,83,661 20,16,904

Balance Carried Forward to Balance Sheet 1,54,72,320 58,83,661

During the year the Company has stock on hire of Rs. 16,84 Crs, gross finance charges of 2.54 Crs. and earned a profit before tax of Rs. 1.90 Crs. Product consolidation and efficiency in business operations have resulted in an improved profitability of your Company during the year. Even in the difficult market, the Company has continued to book a profit as a result of better management, cost efficiencies thus resulting in decent net interest margins.

Going forward the company is planning to capitalize and raise debt to build retail loan book of commercial vehicle and construction equipment finance. The priority sector portfolio with prudent lending shall further improve the profitability of the business.

2. Dividend:

After considering the Company's profitability as well as working capital requirement for its growth plans, your directors are pleased to recommend a final dividend at the rate of 10% i.e. Re. 1/- per equity share. The dividend will be declared in the ensuing Annual General Meeting based on approval by the Shareholders. The total payment on account of dividend (including Dividend Distribution Tax @ 16.225%) shall be Rs. 2,84,745/-.

3. Auditors:

M/s. Nisar & Kumar, Chartered Accountants, Auditors of your Company retire from the office of the Auditors and are eligible for re-appointment The Company has received a certificate from them to the effect that the re-appointment if made will be within the limits prescribed under Section 224(1) of the Companies Act, 1956,

The observations made by the auditors are self-explanatory.

4. Directors;

In accordance with the provisions of the Companies Act, 1956 and the provision of the Article of Association of the Company Mr. N.B. Vyas, being director is liable to retire by rotation and being eligible offers himself for reappointment at the ensuing Annual General Meeting.

During the year, Mr. Sandeep Soni was appointed as an Additional Director of the Company. Now he Is proposed to be appointed as Director and the management of the Company welcomes him on board. He would act in the capacity of Chief Executive officer of the Company.

Except the above, there has been no other change in the Board of Directors of your Company.

5. Subsidiary Company:

On February 14th 2012, your Company acquired 100% stake in AMW Finance Limited. The main objects of the said wholly owned company is hire purchase, leasing and all types of loans for vehicle financing.

As required under the provisions of Section 212 of the Companies Act, 1956 statement of the holding company's interest in the subsidiary companies is attached as Annexure 1 and forms part of this report.

In terms of approval granted by the Central Government under Section 212(8) of the Companies Act, 1956, a copy of the Balance Sheet, Profit and Loss Account, Report of the Board of Directors and the Report of the Auditors of the Subsidiary Company has not been attached with the Balance Sheet of the Company. The Company will make available these documents/details upon request by any investor of the Company or its subsidiaries.

The Annual Accounts of the subsidiary is available for inspection by the investors at the registered office of the Company.

6. Corporate Governance Report:

The provisions related with the corporate governance pursuant to clause 49 of the Listing Agreement are not applicable to the Company. However, as a measure of good governance, the Company complies with most of the requirements specified under clause 49.

7. Directors Responsibility Statement:

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956 your Directors state:

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

- that the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the loss of the Company for the year under review;

- 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;

- That the Directors had prepared the accounts for the financial period ended 31st March, 2012 on a going concern basis.

8. Conservation of energy, technology absorption, foreign exchange earnings and outgo:

Information pertaining to section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars In the Report of Directors) Rules, 1988 with respect to conservation of energy, technology absorption may be treated as NIL since your Company is not a manufacturing Company. As regards Foreign Exchange earnings, the Board wishes to state that there has been no inflow or outflow of foreign exchange earnings.

9. Public Deposits

During the year under review, the Company has neither invited nor accepted any deposits from the public and there are no unclaimed deposits lying with the Company as on March 31, 2012.

10. Particulars of Employees:

The disclosures as required under Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 as amended, is not required as there are no employees covered by it.

11. Disclosures:

The Company has made adequate disclosures regarding related party transactions, contingent liabilities, and significant accounting policy in the Notes to Accounts as an integral part of the Balance Sheet and Profit & Loss Accounts.

12. Stock Exchanges - Compliance of listing Agreements

The Company's shares are listed at The Bombay Stock Exchange and the Company has paid the listing fees to the Stock Exchange. Further, the Company has demat connectivity with both the Depositories, NSDL and CDSL and paid Annual Fees to both the Depositories.

13. Acknowledgement:

Your Directors wish to place on record their gratitude for the co-operation and assistance received from the RBI, shareholders and various departments of Central and State Governments and thank them for their continued cooperation and support.

By order of the Board

Sd/- Sd/- Mr. V.G. Raghavan Mr. Sandeep Soni Director Director

Date: 8th August, 2012 Place: Mumbai


Mar 31, 2010

The Directors take pleasure in presenting the Twenty Sixth Annual Report of the Company, together with the Audited Accounts thereon for the year ended 31st March, 2010.

1. Financial Results:

Particulars For the Tear For the Tear ended on 31st ended on 31st March, 2010 March, 2009 (in Rs) (in Rs )

Currents Years Loss (287,991) (113,918)

Less: Provision for Taxation

- Current Tax

- Deferred Tax 30,288 26,464

Profit / (loss) After Taxation (257,703) (87,454)

Add: Balance Brought Forward from Last Year 2,274,606 2,362,060

Balance carried forward to the Balance Sheet 2,016,903 2,274,606

2. Change in Management & Operations:

Essar Capital Finance Private Limited, an Indian Company belonging to Essar Group (hereinafter referred to as "ECFPL") had entered into an Agreement with the promoters of your Company, for acquisition of 62.63% of the equity capital of the Company at a negotiated price of Rs.30/- per share.

Consequently, as required under SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, ECFPL made an open offer for acquisition of further 20% of equity capital of the Company at a price of Rs.30/- per share, to the shareholders of the Company. By closure of this open offer, additional 9.45 % of the equity capital of the Company had been acquired by ECFPL.

With new management in place, it is proposed to acquire the Finance Undertaking from India Securities Limited ("ISL"), an Indian Company, on going concern basis. The terms and conditions of this acquisition would be determined after receipt of necessary approvals by ISL and the Company. The Finance Undertaking mainly comprises of financing of commercial vehicles. The proposed business is in accordance with the "future plans" as contained in the Letter of Offer issued by the new Promoters of the Company at the time of Open Offer process.

The Company continues to be a Non Banking Financial Company (not accepting public deposits).

3. Dividend:

In view of losses, your Directors do not recommend any dividend for the year.

4. Directors:

The Board at its meeting held on 17th May, 2010 appointed Mr. N. B. Vyas as an Additional Director in accordance with section 260 of the Companies Act, 1956 and article 86 of the Articles of Association of the Company.

Furthermore, w.e.f. 12th August, 2010, Mr. V. G. Raghavan and Mr. S. M. Lodha has been appointed on the Board as an Additional Directors of the Company in accordance with section 260 of the Companies Act, 1956 and article 86 of the Articles of Association of the Company.

Mr. Vijay Sawant, Mr. Vaibhav Sawant and Mrs. Sheela Sawant, who has been on the Board of the Company since December 15, 2007, stepped down from the Board of Directors with effect from August 12, 2010.The Directors place on record place on record their appreciation for the valuable services rendered by Mr. Vijay Sawant, Mr. Vaibhav Sawant and Mrs. Sheela Sawant, during their tenure as Directors of the Company.

5. Auditors:

M/s. J. S. Bhatia & Co., Chartered Accountants, statutory auditors of the Company has tendered their resignation as statutory auditors of the Company. Subsequently, it is proposed to appoint Nisar and Kumar, Chartered Accountants, as the statutory auditors of the Company for the financial year 2010-2011. The Company has received special notice within the meaning of section 225(1) of the Companies Act, 1956, from a member proposing to appoint Nisar and Kumar, Chartered Accountant as Statutory Auditors of the Company.

Nisar and Kumar have communicated their consent and confirmation that their appointment, if made, would be within the limits prescribed under Section 224(1 B) of the Companies Act, 1956. No representation referred to in section 225(3) of the Companies Act, 1956 has been received from the retiring auditors.

Accordingly, the members approval is being sought to their appointment as the Statutory Auditors of the Company at the ensuing Annual General Meeting.

There are no audit qualifications/adverse remarks in the Auditors Report to the shareholders on the Accounts of the company for the year ended March 31,2010.

6. Registered Office:

For the sake of administrative and managerial convenience, the registered office of the Company was shifted from 21,22 2nd Floor, Arsa Shopping Centre, S. V. Road, Andheri(West), Mumbai - 400 058 to Essar House, 11, K. K. Marg, Mahalaxmi, Mumbai - 400 034.

7. Holding Company:

During the current financial year, your Company became a subsidiary of Essar Capital Finance Private Limited, an Indian Company.

8. Corporate Governance Report:

The provisions related with the corporate governance pursuant to clause 49 of the Listing Agreement are not applicable to the Company. However, as a measure of good governance, the Company complies with most of the requirements specified under clause 49.

9. Directors Responsibility Statement:

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956 your Directors state:

- that in the preparation of the annual accounts for the financial period ended 31st March, 2010, the applicable accounting standards had been followed along with proper explanation relating to material departures;

- that the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the loss of the Company for the year under review;

- 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;

- that the Directors had prepared the accounts for the financial period ended 31st March, 2010 on a going concern basis.

10. Conservation of energy, technology absorption, foreign exchange earnings and outgo:

Information pertaining to section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Directors) Rules, 1988 with respect to conservation of energy, technology absorption may be treated as NIL since your Company is not a manufacturing Company. As regards Foreign Exchange earnings, the Board wishes to state that there has been no inflow or outflow of foreign exchange earnings.

11. Public Deposits

During the year under review, the Company has neither invited nor accepted any deposits from the public and there are no unclaimed deposits lying with the Company as on March 31,2010.

12. Particulars of Employees:

The disclosures as required under Section 217(2A) of the Companies Act, 19S6 read with Companies (Particulars of Employees) Rules, 1975 as amended, is not required as there are no employees covered by it.

13. Acknowledgement:

Your Directors wish to place on record their gratitude for the co-operation and assistance received from the banks, shareholders and various departments of Central and State Governments and thank them for their continued cooperation and support.

By Order of the Board

Director Director

Date: 06/09/2010

Place: Mumbai

 
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