Home  »  Company  »  Karnavati Finance Lt  »  Quotes  »  Directors Report
Enter the first few characters of Company and click 'Go'

Directors Report of Karnavati Finance Ltd.

Mar 31, 2018

The Shareholders,

The directors have the pleasure in presenting 34th Annual Report of Your Company with the Audited Financial Statements of the Company for the financial year ended on March 31, 2018.

1. Financial Results

(Amount in Rupees)

Particulars

2017-18

2016-17

Revenue From Operations

2,01,97,475

94,68,162

Other operation Income

6,60,551

28,02,142

Total Revenue

2,08,58,026

1,22,70,304

Less: Total Expenses before Depreciation, Finance Cost & Tax

55,50,400

23,12,303

Operating Profits before Depreciation, Finance Cost & Tax

1,53,07,626

99,58,001

Less: Depreciation

2,06,397

1,61,477

Finance cost

67,87,853

1,27,448

Profit/ (Loss) Before Tax

83,13,376

96,69,076

Less: Current Tax

21,24,948

19,59,563

Less: Deferred Tax Liability (Assets)

(25,083)

1,67,000

Profit/ (Loss) after Tax

62,13,511

75,42,513

2. Review of Business Operation

During the financial year 2017-18, The Company has earned total income of Rs. 208.58 Lakhs from business activities including income from other sources as compared to 122.70 Lakhs in previous year. The total revenue of the company is increased by 70.00%.

During the financial year 2017-18, total 32 loan accounts were written off amounting to Rs. 1.55 lakhs as the same was 100% bad debts.

The total Profit before tax for the financial year 2017-18 stood at Rs. 83.13 Lakh and the total net profit after tax for the financial year 2017-18 stood at Rs. 62.13 Lakh. Due to increase in business operations, our finance cost and employment expenses increased to 67.78 lakhs and 26.81 lakhs respectively.

The Directors of the Company are planning to expand the business of the Company in the current year by providing the varied types of the financial services to the customers along with the prospect of opening various branches in the metros and thus confident of presenting the better figures in the coming years.

3. Dividend

To conserve resources for future prospect and growth of the Company, your Directors regret to declare Dividend for the Financial Year 2017-18 (Previous year - Nil).

4. Net Profit Transfer to Reserve

The Company has transferred Rs. 12.43 Lakh to Statutory Reserve Fund in terms of Section 45-1C of the Reserve Bank of India Act, 1934.

5. Change in Nature of Business

During the year, your Company has not changed its business or object and continues to be in the same line of business as per main object of the Company.

6. License For Money Changer

The Company has commenced activities of Full Fledged Money Changing and earned revenue of Rs. Rs. 1.85 Lakh in the financial year 2017-18 as compare to that in previous financial year i.e. Rs. 1.37 Lakh. which shows business progress of the company in the said line of business activity. The Board of Directors are in planning to expand the activities of Full Fledged Money Changing Activities in coming years and thus increasing the line of business of the Company.

7. Share Capital

The paid up share capital of the company as on March 31, 2018 was Rs. 10.05 crores.

During the year under review, on April 29, 2017 the Authorized Share Capital of the Company was increased by the Members of the Company from Rs. 10,00,00,000/- (Rupees Ten Crore only) divided into 1,00,00,000 (One Crore only) Equity Shares of Rs. 10/- (Rupees Ten only) each to Rs. 10,50,00,000/-(Rupees Ten Crore Fifty Lakh only) divided into 1,05,00,000 (One Crore Five Lakh only) Equity Shares of Rs. 10/- (Rupees Ten only) each, by way of creation of an additional 5,00,000 (Five Lakhs only) Equity Shares of Rs. 10/- (Rupees Ten only) each ranking pari passu in all respect with existing equity shares of the company, aggregating to Rs. 50,00,000/- (Rupees Fifty Lakh only).

The board of directors had made allotment of 16, 90,000 Equity Shares on May 30, 2017 to promoters including promoter group and public on preferential allotment. The Company has received Listing and trading approval for the same by BSE Limited and the same was effective from Wednesday, June 21, 2017.

8. Migration of Listing

The Company had made application for Migration from SME Platform of BSE Limited to Main Board of BSE Limited and the application of the Company was approved by the stock exchange and the Equity Shares of the Company are available for the trading at Main Board of BSE Limited w.e.f. Wednesday, August 9, 2017.

9. Dematerialization of Shares

The Company has entered into Tripartite Agreement with the depositories, National Securities Depository Limited (NSDL) and Central Depository Service (India) Limited (CDSL) for providing Demat facility to its Shareholders. For this purpose, the company has appointed Satellite Corporate Services Private Limited, as its registrar and Share Transfer Agent.

10. Material Changes & Commitments

There are no material changes and commitments affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statement relates and the date of this report.

Note: For better transparency, accountability and for good governance of listed entity, Securities and Exchange Board of India (SEBI) and Reserve Bank of India (RBI) had mandated certain disclosure by listed entity in a stipulated time frame. So line with the said circular company had made necessary compliances as required by SEBI and RBI to be compliant company in letter as well spirit too.

11. Review of Business Operations & Future Prospects

The directors have taken various actions so as to expand the business of the company and they are in planning to start a FinTech collaborations with another companies so as to have a better growth of the company. Further, they are also planning to open various branches of the company in the state of Gujarat and Maharastra for the purpose of expanding the business of money changing and thereby increasing the overall business of the company in a near future.

12. Corporate Governance

Details regarding Corporate Governance Report of the Company regarding compliance of the conditions of Corporate Governance pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are annexed herewith as “Annexure-I".

13. Deposits

The company being Non-Deposit accepting Non-Banking Finance Company has not accepted any deposits from the public. Hence, the directives issued by the Reserve Bank of India & the Provision of Section 73 to 76 of the Company Act, 2013 or any other relevant provisions of the Act and the Rules there under are not applicable. Moreover, the Company is not holding any Deposit as at the financial year ended on March 31, 2018.

14. Director''s Responsibility Statement

Pursuant to section 134(5) of the Companies Act, 2013, the board of directors, to the best of their knowledge and ability, confirm that:

a) In preparation of annual accounts for the year ended March 31, 2018, the applicable accounting standards have been followed and that no material departures have been made from the same;

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 the end of the financial year and of the profit or loss of the Company for that year;

c) The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) The Directors had prepared the annual accounts for the year ended March 31, 2018 on going concern basis.

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

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

15. Statutory Auditor & their Report

During the financial year 2017-18, the company has received Resignation Letter from its existing Statutory Auditor i.e. M/S Maharishi & Co. Chartered Accountant, Jamnagar (FRN:124872W) stating that they are not willing to act as a statutory auditor from October 04, 2017.

The Board of Directors at its meeting held on October 4, 2017 and as per the recommendation of the Audit Committee, and pursuant to the provisions of Section 139, 140(4), 142 and other applicable provisions, if any, of the Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014 and other applicable provisions if any, recommended the appointment M/s. Doshi Maru & Associates, Chartered Accountants, Mumbai (FRN: 0112187W) as statutory auditor of the Company to fill up the casual vacancy caused due to resignation of M/s. Maharishi & Co. Chartered Accountants (FRN: 124872W) Jamnagar.

The Company has also received consent and eligibility certificate from M/s. Doshi Maru & Associates, Chartered Accountants, Mumbai (FRN: 0112187W), to act as Statutory Auditors of the Company along with a confirmation that, their appointment, if made, would be within the limits prescribed under the Companies Act, 2013.

In terms of provisions of Section 139(8) of the Companies Act, 2013; M/ s. Doshi Maru & Associates, Chartered Accountants, Mumbai (FRN: 0112187W) shall hold office as statutory auditor of the Company till the conclusion of 34th Annual General Meeting of the Company.

The report of statutory auditor is self-explanatory and need not require any further clarification, explanations and there is no adverse impact or observation or qualification made by the statutory auditor for the financial year 2017-18.

Note: Members of company had also given their consent for appointment of M/s. Doshi Maru & Associates in their meeting held on Wednesday, January 03, 2018 by way of passing ordinary resolution for their appointment.

16. Management Discussion and Analysis Report

Management Discussion and Analysis, for the year under review, as stipulated under Regulations 27(2) of the SEBI (LODR), 2015, is attached to this report as an "Annexure-II"

17. Extracts of Annual Return

Pursuant to sub-section 3(a) of Section 134 and sub-section (3) of Section 92 of the Companies Act, 2013 read with Rule 12 of Companies (Management and Administration) Rules, 2014 the extract of the Annual Return as at March 31, 2018 in Form MGT-9, forms part of this Annual Report as "Annexure - III".

18. Particulars Of Remuneration of Directors and Key Managerial Personnel

The details of remuneration paid during the financial year 2017-18 to Executive Director and Key Managerial Personnel of the Company is provided in Form MGT-9 (Annexure - III) which is the part of this report.

19. Secretarial Auditor & their Report

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mrs. Ankita Patel, Practicing Company Secretary, Ahmedabad to carry out the Secretarial Audit for the financial year ended on March 31, 2018. Secretarial Audit Report is attached to this report as "Annexure - IV".

20. Particulars of contracts or arrangement made with Related Party

All transactions to be entered by the Company with related parties will be in the ordinary course of business and on an arm''s length basis. Further, there are few transactions which may not be on Arms'' Length Basis, the detail of which is given in "Annexure - V" in Form AOC-2 and the same forms part of this report.

21. Particulars of Employees

The ratio of the remuneration of each whole-time director to the median of employees'' remuneration as per Section 197(12) of the Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to this Report as "Annexure - VI".

- Statement containing the names of top 10 employees in terms of remuneration drawn shall be made available on request

- Details of employees posted in India throughout the fiscal and in receipt of a remuneration of Rs. 1.02 crore or more per annum. -Not Applicable since there was no such employee employed by the Company during F.Y. 2017-18.

- Details of employees posted in India for part of the year and in receipt of Rs.8.5 lakh or more a month. Not Applicable since there was no such employee employed by the Company during F.Y. 2017-18.

- Employees employed throughout the financial year or part thereof, was in receipt of remuneration in that year which, in the aggregate, or as the case may be, at a rate which, in the aggregate, is in excess of that drawn by the managing director or whole-time director or manager and holds by himself or along with his spouse and dependent children, not less than two percent of the equity shares of the company. Not Applicable since there was no such employee employed by the Company during F.Y. 2017-18.

- There are no employees posted outside India.

22. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings & Outgo

The details of conservation of energy, technology absorption etc. as required to be given under section 134(3)(m) of the Companies Act 2013 read with the Companies (Accounts) Rules, 2014, are not applicable to our Company, as the Company is not carrying on any manufacturing activities.

Further, there was no foreign exchange earnings and outgo during the financial year 2017-18 (Previous Year - Nil).

23. Board Evolution

The Board of Directors has carried out an annual evaluation of its own performance, board committees and individual directors pursuant to the provisions of the Act.

Further, Nomination and Remuneration Committee has also carried out the performance evaluation of the individual directors on the basis of the criteria such as the contribution of the individual director to the board and committee meetings. In addition, the chairman was also evaluated on the key aspects of his role.

Separate meeting of independent directors was held to evaluate the performance of non-independent directors, performance of the board as a whole and performance of the chairman, taking into account the views of executive directors and non-executive directors.

24. Particulars of loans, guarantees or Investments made under section 186 of the Companies Act, 2013

Details of Loans, Guarantees, Investments and Security covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statement.

25. Internal Financial Control System and their Adequacy

The details on Internal Financial Control and their adequacy are provided in Management Discussion and Analysis Report.

Note: During the year under review, the company has appointed M/S Suresh Tejwani & Co, as an Internal Auditor to look after the internal financial control and their adequacy.

26. Risk Management Policy

A well-defined risk management mechanism covering the risk mapping and trend analysis, risk exposure, potential impact and risk mitigation process is in place. The objective of the mechanism is to minimize the impact of risks identified and taking advance actions to mitigate it. The mechanism works on the principles of probability of occurrence and impact, if triggered. A detailed exercise is being carried out to identify, evaluate, monitor and manage both business and non-business risks.

27. Vigil Mechanism

The detailed vigil mechanism is provided in Annexure - I "Corporate Governance Report"- under the title "Audit Committee".

28. Prevention of Insider Trading

The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The Code requires preclearance for dealing in the Company''s shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. All the Board of Directors and designated employees have confirmed compliance with the Code.

29. Disclosure Under Sexual Harassment Of Women At Workplace (Prevention, Prohibition And Rederessal) Act, 2013

There were no incidences of sexual harassment reported during the year under review, in terms of the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 as there are no woman employees employed by the Company during the Financial Year 2016-17.

30. Names Of The Companies Which Have Become Or Ceased To Be Its Subsidiaries, Joint Ventures Or Associate Companies During The Year

There is no subsidiary, joint venture or associate company as on March 31, 2018 so the same is not applicable to the company.

31. Pecuniary Relationship Or Transactions Of Non-Executive Directors

During the year under review, the non-executive directors of the company had no pecuniary relationship or transaction with the company.

32. General Disclosure

Your Directors state that the Company has made disclosures in this report for the items prescribed in section 134(3) of the Act and Rule 8 of The Companies (Accounts) Rules, 2014 to the extent the transactions took place on those items during the year.

Your Directors further state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

1. Details of Annual Report on Corporate Social Responsibility as Company is not falling within the criteria as prescribed u/s 135 of the Companies Act, 2013

2. Issue of Equity Shares with differential rights as to dividend, voting or otherwise.

3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and ESOS.

4. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future.

33. Acknowledgement

Your Directors take this opportunity to place on record the valuable co-operation and support extended by the banks, government, business associates and the shareholders for their continued confidence reposed in the Company and look forward to having the same support in all future endeavors.

For and on behalf of Board of Directors

Karnavati Finance Limited

Place: Mumbai Jay Morzaria Raman Morzaria

Date: August 13, 2018 Managing Director Whole-Time Director

DIN: 02338864 DIN: 00203310


Mar 31, 2015

Dear Members,

The Directors have the pleasure of presenting the Thirty First Annual Report of your Company together with the audited accounts for the year ended 31st March, 2015.

(Rs. In Lakh)

Particulars 2014-15 2013-14

Income from Finance Charge 47.58 37.43

Other Income - -

Total Revenue 47.58 37.43

Less: Total Expenses (80.81) (26.84)

Operating Profits (PBDT) (33.23) 10.59

Less: Depreciation 1.57 1.46

Profit Before Tax & Exceptional Items (34.80) 9.12

Less: Current Tax 2.72 4.65

Profit after Tax (37.52) 4.47

REVIEW OF BUSINESS OPERATION

During the year under review, your company has earned income of Rs. 47.58 Lakh from Finance Charges in financial year 2014-15 compared to the income of Rs. 37.43 Lakh of previous year which shows about 27% growth over the previous year. The overall increase in cost is due to higher amount of loan losses written off, provision for NPA and public issue related expenses written off during the financial year 2014-15. The Loss before Tax for the financial year 2014-15 stood at Rs. 34.80 Lakh as compared to Profit before Tax of Rs. 9.12 Lakh of previous year making total Net Loss of Rs. 37.52 Lakh for the financial year 2014-15 as compared to Net Profit of Rs. 4.47 Lakh of previous year.

DIVIDEND

In view of loss during the year, your Directors regret to declare dividend for the financial year 2014-15 (Previous year - NIL).

NET PROFIT TRANSFER TO RESERVE

In view of loss during the year, your Directors have not transferred any amount to any reserve for the financial year 2014-15 (Previous year - NIL).

INFORMATION ON BOARD OF DIRECTOR, KEY MANAGERIAL PERSONNEL AND ITS MEETINGS:

Composition:

The Board consist of four (4) members as on March 31, 2015, two (2) of whom are Promoters and Executive Directors (one is Managing Director and one is Whole-Time Director) and remaining two (2) are Independent Directors. Vide SEBI circular no. CIR/CFD/POLICY CELL/7/2014 dated September 15, 2014; the Company is not required to appoint Woman Director on the Board of the Company. The Composition of Board fulfills the requirements of Companies Act, 2013 and Clause 52 of Listing Agreement entered by the Company with BSE Limited (SME Segment).

Board Meeting:

Regular meetings of the Board are held at least once in a quarter. Additional Board meetings are convened to discuss and decide on various business policies, strategies and other businesses.

During the year under review, Board of Directors of the Company met 17 times. The details of Board meeting are provided in the Corporate Governance Report.

The gap between two consecutive meetings was not more than one hundred and twenty days as provided in section 173 of the Act.

Further, your Company has formed following Committees of the Board in accordance with Companies Act, 2013 and the Listing Agreement:

* Audit Committee

* Stakeholders' Grievances and Relationship Committee

The details of number of meetings of Committees, its composition, powers, terms of reference is provided under the corporate governance report section in this Annual Report.

Appointment, Re-appointment and Resignation of Directors:

During the year, the Board of Directors of the Company has appointed Mr. Jay Morzaria as a Managing Director of the Company and Mr. Raman Morzaria as a Whole Time Director of the Company w.e.f. July 1, 2014 for the period of five years i.e. up to June 30, 2019 in their Meeting held on June 10, 2014. Members have approved their appointment in their Extra Ordinary General meeting held on July 5, 2014.

Mr. Vineshkumar Makadia and Mr. Rajesh Lodaya have resigned from the Board w.e.f. July 3, 2014. Further, Mrs. Daxaben Morzaria has resigned from the Board w.e.f. July 15, 2014. The Board places on record their appreciation for the services rendered by them during their tenure with the Company.

The Board of Directors has, in their meeting held on July 24, 2014, appointed Mr. Jay Somaiya as an additional Director of the Company. Further, Mr. Kaushal Ruparel has been appointed as an Additional Director of the Company w.e.f. August 2, 2014. The Members, in their Last Annual General Meeting, have regularised them and appointed as Independent Directors of the Company to hold office for a period of five years w.e.f. September 6, 2014.

In accordance with the provisions of the Articles of Association and Section 152 of the Companies Act 2013, Mr. Raman Morzaria, Whole-Time Director of the Company, retire by rotation at the ensuring Annual General Meeting and being eligible, offer himself for re-appointment. The Board of Directors recommends his re-appointment on the Board of the Company.

Mr. Jay Morzaria, Managing Director and Mr. Raman Morzaria, Whole-Time Director are appointed as the Key Managerial Personnel of the Company as per the provisions of the Companies Act, 2013.

None of the Directors of the Company is disqualified for being appointed as Director as specified in Section 164 (2) of the Companies Act, 2013.

Declaration by Independent Directors:

The Company has received necessary declaration from each Independent Director under Section 149(7) of the Companies Act, 2013, to the effect that they meet the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Clause 52 of the Listing Agreement. The terms and conditions of the Independent Directors are incorporated on the website of the Company.

SHIFTING OF REGISTERED OFFICE

The Board of Directors had decided to shift the Registered office of the Company from B-25, Mistry Building, Room No. 8, Bhat Bazar Keshavji Naik Road, Masjid Bandar, Mumbai - 400 009, Maharashtra to Unit No 2, Sagar Deep Darshan Co- Operative Housing Society Limited, S.V. Road, Borivali (W) Mumbai - 400 092, Maharshtra. Accordingly, the registered office of the Company has been changed to new address, within the city, w.e.f. July 23, 2014 by the Board of Directors.

CHANGE IN CAPITAL

During the year, the Authorized Share Capital of the Company has been increased from Rs. 5.00. 00.000/- divided into 50,00,000 Equity Shares of Rs. 10/- each to Rs. 10,00,00,000/- divided into 1,00,00,000 Equity Shares of Rs. 10/- each.

The Company has issued 20,00,000 Equity Shares of Rs. 10/- each amounting to total Rs. 2.00. 00.000/- to existing members and person other than existing members on September 27, 2014 on private placement basis. Further, during the year, Company has come up with Initial Public Issue of 25,80,000 Equity Shares of Rs. 10/- each amounting to total Rs. 2,58,00,000/-. The issue was open during Monday, January 19, 2015 to Wednesday, January 21, 2015. The issue was successfully subscribed by the public and the final allotment of the said 25,80,000 Equity Shares was made on January 31, 2015.

The Company has complied with all the requirement prescribed by the Companies Act, 2013 and SEBI regulation for increase in the authorized capital as well as issue of Shares. As at the end of Financial Year 2014-15, the total Paid - Up Equity Share Capital of the Company stood at 83,60,000 Equity Shares of Rs. 10/- each amounting to total Rs. 8,36,00,000/-.

LISTING OF SECURITIES

The company had made the application to BSE for Listing of its security on the BSE SME portal on February 02, 2015, pursuant to Initial Public issue of 25,80,000 Equity Shares of Rs. 10/- each. The BSE vide its letter dated February 04, 2015 has given final approval for listing and trading of 83,60,000 Equity Shares of Rs. 10/- each on BSE SME platform from Thursday, February 05, 2015 onwards.

PUBLIC DEPOSIT

The company has not accepted any deposits from the public. Hence, the directives issued by the Reserve Bank of India & the Provision of Section 73 to 76 of the Company Act, 2013 or any other relevant provisions of the Act and the Rules there under are not applicable.

PARTICULARS OF LOANS, GUARANTEES, INVESTMENTS & SECURITY

Details of Loans, Guarantees, Investments and Security covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statement.

CORPORATE SOCIAL RESPONSIBILITY [CSR]

The Provisions of the CSR expenditure and Composition of Committee, as provided in the Section 135 of the Companies Act, 2013, are not applicable to the company. So Report on Annual performance of CSR activities is not applicable to the Company.

CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions to be entered by the Company with related parties will be in the ordinary course of business and on an arm's length basis. However, the Company has not entered into any related party transaction, as provided in Section 188 of the Companies Act, 2013, with the related party. Hence, Disclosure as required under Section 188 of the Companies Act, 2013 is not applicable to the Company.

EXTRACT OF ANNUAL RETURN

Pursuant to sub-section 3(a) of Section 134 and sub-section (3) of Section 92 of the Companies Act, 2013 read with Rule 12 of Companies (Management and Administration) Rules, 2014 the extract of the Annual Return as at March 31, 2015 in Form MGT-9, forms part of this Annual Report as Annexure - A.

PARTICULAR OF EMPLOYEES

The ratio of remuneration of each Director to the median employee's remuneration and other details in terms of sub-section 12 of Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are forming part of this Annual Report as Annexure - B.

The details as required under section 197(12) of the Companies Act, 2013, read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel), 2014 is not applicable as there is no employee in the Company employed throughout the financial year with salary above Rs. 60 Lakh p.a. or employed part of the financial year with average salary above Rs. 5 Lakh per month.

Further, there is no employee employed throughout Financial year or part thereof, was in receipt of remuneration of in aggregate is in excess of that drawn by the Managing Director or Whole time Director or Manager and holds by himself or along with his spouse and dependent children, not less than Two percent (2%) of the Equity Shares of the Company.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The details of conservation of energy, technology absorption etc. as required to be given under section 134[3][m] of the Companies Act 2013 read with the Companies [Accounts] Rules, 2014, are not applicable to our Company, as our Company has not carried out in the manufacturing activities.

Further, there was no foreign exchange earnings and outgo during the financial year 2014-15 (previous year - Nil).

MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY

There are no material changes and commitments, affecting the financial position of the Company which has occurred between the end of financial year of the Company i.e. March 31, 2015 and the date of Director's Report i.e. August 24, 2015.

SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

There were no incidences of sexual harassment reported during the year under review, in terms of the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

HUMAN RESOURCES

During the year under review the employee attrition was minimal. The management continues its efforts in imparting professional training to Executives and Staff members at various levels with the view to upgrade their competence and managerial abilities. The Industrial relations in the company continued to be cordial in the year 2014-15.

BUSINESS RISK MANAGEMENT

The Company believes that it has internal controls and risk management systems to assess and monitor risks. The company has its management team which monitors and manages risks by monitoring trends that may have an effect on the economic environment and actively assesses on a routine basis the market value of the Company's loan book. The Company seeks to monitor and control its risk exposure through a variety of separate but complementary financial and operational reporting systems. The Company believes it has effective procedures for evaluating and managing the market, operational and other risks to which it is exposed. During the year, The Company has made Provision for NPA of Rs. 5.90 Lakh and written off Rs. 25.12 Lakh for Loan Losses.

CORPORATE GOVERNANCE

Your Company strives to incorporate the appropriate standards for corporate governance. Pursuant to Clause-52 of listing agreement to the Stock Exchange Corporate Governance Report and Practicing Company Secretaries' on its compliance is annexed and forms part of this report.

MANAGEMENT DISCUSSION AND ANALYSIS [MDA]

MDA, for the year under review, as stipulated under clause 52 of the Listing Agreement, is presented in a separate section forming part of this Annual Report.

AUDITORS

Statutory Auditor & their report:

The Company's Auditor, M/s. Maharishi & Co., Chartered Accountants, Jamnagar, [FRN: 124872W], who retires at the ensuing Annual General Meeting of the Company, are eligible for re-appointment. They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and Rules made thereunder for reappointment as Auditors of the Company.

The Board of Directors, based on recommendation made by the Audit Committee, has recommended the appointment of M/s. Maharishi & Co., Chartered Accountants, Jamnagar, [FRN: 124872W] as the Statutory Auditors of the Company to hold the office from the ensuing AGM till the conclusion of the 36th AGM of the Company (subject to ratification of appointment at each subsequent Annual General meeting) on such remuneration as may be determined by the Board in consultation with the auditors.

The Auditors' Report on the accounts of the Company for the accounting year ended March 31, 2015 is self-explanatory and do not call for further explanations or comments that may be treated as adequate compliance of Section 134 of the Companies Act, 2013.

Secretarial Auditor & their report:

Pursuant to the provisions of section 204 of the Act and The Companies [Appointment and Remuneration of Managerial Personnel] Rules, 2014, the Company has appointed Mr. Anand S. Lavingia - Practicing Company Secretary to carry out the Secretarial Audit for the financial year ended on March 31, 2015. Secretarial Audit Report is attached to this report as Annexure - C.

The Secretarial Auditors' Report for the financial year ended on March 31, 2015 is self- explanatory and do not call for further explanations or comments that may be treated as adequate compliances of various act, rules, regulations, guidelines etc. as applicable to the Company.

DIRECTORS' RESPONSIBILITY STATEMENT

In terms of section 134[3][c] of the Act, your Directors state that:

I. in the preparation of the annual financial statements for the year ended on March 31, 2015, applicable accounting standards read with requirements set out under schedule III of the Act, have been followed along with proper explanation relating to material departures, if any,

II. such accounting policies have been selected and applied consistently and judgments and estimates made 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 the year ended on that date,

III. proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for prevention and detection of fraud and other irregularities,

IV. the annual financial statements are prepared on a going concern basis,

V. proper internal financial controls are in place and that the financial controls are adequate and are operating effectively and

VI. the systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

GENERAL DISCLOSURE

Your Directors state that the Company has made disclosures in this report for the items prescribed in section 134[3] of the Act and Rule 8 of The Companies [Accounts] Rules, 2014 to the extent the transactions took place on those items during the year.

Your Directors further state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

1. Details relating to deposits covered under Chapter V of the Act.

2. Issue of Equity Shares with differential rights as to dividend, voting or otherwise.

3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and ESOS.

4. Details of Subsidiary, Associates and Joint Venture Company

5. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future.

ACKNOWLEDGEM ENT

Your Directors wish to place on record their sincere appreciation for significant contributions made by the employees at all levels through their dedication, hard work and commitment, enabling the Company to achieve good performance during the year under review.

Your Directors also take this opportunity to place on record the valuable co-operation and support extended by the banks, government, business associates and the shareholders for their continued confidence reposed in the Company and look forward to having the same support in all future endeavors.

Registered Office By Order of the Board Unit No 2, Sagar Deep Darshan Co operative For, KARNAVATI FINANCE LIMITED Housing Society Limited, S.V. Road, Borivali (W), Mumbai, Maharashtra - 400 092 Jay Morzaria Raman Morzaria Place: Jamnagar Managing Director Whole-Time Director Date : August 24, 2015 DIN: 02338864 DIN: 00203310

Get Instant News Updates
Enable
x
Notification Settings X
Time Settings
Done
Clear Notification X
Do you want to clear all the notifications from your inbox?
Settings X