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Directors Report of Motor & General Finance Ltd.

Mar 31, 2015

Dear Members,

The Board of Directors of The Motor & General Finance Limited take pleasure in presenting their 85th Report on the business and operations of the company and the accounts for the financial year ended March 31,2015.

1. Financial Summary

The Board's Report is prepared based on the stand alone financial statements of the company. The company's financial performance for the year under review along with previous year figures are given hereunder:-

( Rs. in lacs)

Financial Results Year ended Year ended March 31, March 31, 2015 2014

Gross Profit before depreciation, finance cost and provisioning 919.54 943.93

Less: Finance Cost (701.47) (545.41)

Less: Depreciation including impairment and property reserves (90.14) (66.07)

Profit /(Loss) before provisions, exceptional items and tax 127.93 332.45

Add: Provision for doubtful debts written back - 73.94

Add : Provision for diminution in value of investments (214.57) (7.91)

Profit /(Loss) before, exceptional items and tax (86.64) 398.48

Less : Amount written off - (61.59)

Less: Excess Depreciation of earlier years written back 11.54 -

Provision for tax (70.00) (65.00)

Excess/(short)provision of tax of earlier years (26.94) 4.39

Deferred Tax 76.04 50.23

Net Profit(/Loss) for the year (96.00) 326.51

Total Profit/(Loss) (1489.21) (1393.21)

Losses carried forward to Balance Sheet (1489.21) (1393.21)

Profitability of the company has been materially affected on account of provision for diminution in the value of long term investments amounting to Rs. 214.57 lacs and write off of irrecoverable sum of Rs. 101.13 lacs. The above provisions and write off has mainly resulted into loss of Rs. 96 lacs for the year ended March 31,2015.

2. Dividend & Reserves

On account of loss reported by the company during the current year, the Board of Directors have not recommended any dividend. Reserves and Surplus as on March 31,2015 stood at Rs. 6858.16 lacs.

Keeping in view the decision of the FRRB with respect to the rectification and /or restatement of the financial statement, in compliance, the company has made provision as on March31,2015 for diminution in value of long term investments amounting to Rs. 214.57 lacs . There is, as such, no audit qualification in the financial statements by the statutory auditors for the year under review.

3. Share Capital

The Paid up Equity Share Capital as on March 31,2015 stood at Rs.1936.35 lacs. During the year there is no increase in the Share Capital.

4. Finance and Accounts

Your company prepared its financial statements in compliance with the requirements of the Companies Act, 2013 and have been prepared on historical cost basis. The estimates and judgments relating to the financial statements are made on a prudent basis, so as to reflect a true and fair manner.

5. Corporate Governance

As per Clause 49 of the Listing Agreement with the Stock Exchanges, Auditor's Certificate regarding the compliance of conditions of Corporate Governance (Annexure'A') and Management Discussion and Analysis Report(Annexure 'B') forms part of this report. A separate section on Corporate Governance practices followed by the company from the company's auditors confirming compliance forms an integral part of this report.

6. Extract of Annual Return

Details forming part of the extract of the Annual Return in form MGT-9, as required under Section 92 of the Companies Act, 2013, is included in this report as Annexure- C and forms an integral part of the report.

7. Policy on Directors' Appointment and Remuneration and other details

The Board has, in terms of section 178(3) of the Companies Act,2013, on the recommendation of the Nomination & Remuneration Committee, laid down a Nomination & Remuneration policy for selection and appointment of the Directors, Key Managerial Personnel and Senior Management and their remuneration. The company's policy on Directors' appointment and remuneration is stated in the Corporate Governance Report.

As at March 31,2015, your Board comprised of following six Directors:-

i) Sh. Rajiv Gupta, Chairman & Managing Director

The Board of Directors, upon the recommendations of the Remuneration Committee consequent to the demise of Sh. Ved Prakash Gupa, Chairman Emeritus, designated Sh. Rajiv Gupta(DIN:00022964), the Managing Director, as the Chairman & Managing Director of the company with effect from September 1,2005. Further, on the recommendation of Nomination & Remuneration Committee, he was re-appointed by the Board at its meeting held on March 10,2014 for a period of three years with effect from April 1,2014 to March 31,2017 which was approved by the shareholders through Postal Ballot on April 25,2014. Also, on the recommendation of the Nomination and Remuneration Committee, the Board of Directors at its meeting held on October 20,2014, considered the variation in the terms of remuneration with effect from December 1,2014 and the same was approved by the shareholders through Postal Ballot on December 12, 2014. The Board of Directors in their meeting held on August 13,2015, on the recommendation of the Nomination & Remuneration Committee, have also considered the variation in the terms of remuneration viz increase in the salary with effect from October 1, 2015 upto March 31,2017 as set out in the resolution to be passed by the shareholders in the ensuing Annual General Meeting.

ii) Smt. Arti Gupta, Joint Managing Director

Smt. Arti Gupta(DIN:00023237), on the recommendations of the Remuneration Committee was appointed by the members in their meeting held on August 29,2008 as Joint Managing Director of the company for a period of three years from June 5,2008 to June 4,2011. Smt. Arti Gupta is related to Sh. Rajiv Gupta, Chairman & Managing Director and on the recommendation of Nomination & Remuneration Committee, she was re-appointed by the Board at its meeting held on March 10,2014 for a period of three years from June 5,2014 to June 4,2017 which was approved through Postal Ballot by the shareholders on April 25,2014. Also, on the recommendation of the Nomination and Remuneration Committee, the Board of Directors at its meeting held on October 20,2014, considered the variation in the terms of remuneration with effect from December 1,2014 and the same was approved by the shareholders through Postal Ballot on December 12,2014. The Board of Directors in their meeting held on August 13,2015, on the recommendation of the Nomination & Remuneration Committee, have also considered the variation in the terms of remuneration viz increase in the salary with effect from October 1, 2015 upto June 4,2017 as set out in the resolution to be passed by the shareholders in the ensuing Annual General Meeting.

In the case of Smt. Arti Gupta, Joint Managing Director, there is due compliance of section 149(1) of the Companies Act,2013 and clause 49 of the Listing Agreement, providing for appointment of Woman Director on the Board.

iii) Sh. Arun Mitter, Executive Director

Sh. Arun Mitter(DIN:00022941), a Chartered Accountant, was appointed as Whole Time Director in the company in the year 2002 and since then, his appointment has been renewed from time to time. On the recommendation of Nomination & Remuneration Committee, he was re-appointed by the Board at its meeting held on March 10,2014 for a period of three years with effect from July 11,2014 to July 10,2017 which was approved through Postal Ballot by the shareholders on April 25,2014. Further, on the recommendation of the Nomination and Remuneration Committee, the Board of Directors at its meeting held on October 20,2014, considered the variation in the terms of remuneration with effect from December 1,2014 and the same was approved by the shareholders through Postal Ballot on December 12,2014. The Board of Directors in their meeting held on August 13,2015, on the recommendation of the Nomination & Remuneration Committee, have also considered the variation in the terms of remuneration viz increase in the salary with effect from October 1,2015 upto July 10,2017 as set out in the resolution to be passed by the shareholders in the ensuing Annual General Meeting.

iv) Sh. Bharat Kumar, Independent Director

Sh. Bharat Kumar(DIN:00990117) was appointed by the Board in their meeting held on March 19,2002, He is a graduate in Commerce and holds a rich business experience. Pursuant to the provisions of Section 149, 150, 152 and any other applicable provisions of the Companies Act,2013 and rules made thereunder, Sh.Bharat Kumar has been appointed as an Independent Director whose term of office shall not be liable to retirement by rotation in terms of section 149(13) of the said Act. Declaration has been received to the effect that he meets the criteria of independence as provided in section 149(6) of the Act. He holds the office for five consecutive years with effect from September 18,2014 upto September 17, 2019.

v) Sh. Abhiram Seth, Independent Director

Sh.Abhiram Seth(DIN:00176144) was appointed by the Board in their meeting held on April 29,2006. He is graduate in Economics and Master in Management Studies and holds extensive experience in diverse fields. Pursuant to the provisions of Section 149, 150, 152 and any other applicable provisions of the Companies Act,2013 and rules made thereunder, Sh. Abhiram Seth has been appointed as an Independent Director whose term of office shall not be liable to retirement by rotation in terms of section 149(13) of the said Act. Declaration has been received to the effect that he meets the criteria of independence as provided in section 149(6) of the said Act. He holds the office for five consecutive years with effect from September 18,2014 upto September 17, 2019.

vi) Sh. Onkar Nath Aggarwal, Independent Director

Sh. Onkar Nath Aggarwal(DIN:00629878) was appointed by the Board in their meeting held on December 31,2005. He is a qualified Mechanical Engineer and holds DLCT(Hons) degree from UK. Pursuant to the provisions of Section 149, 150, 152 and any other applicable provisions of the Companies Act,2013 and rules made thereunder, Sh.Onkar Nath Aggarwal has been appointed as an Independent Director w.e.f. March 31,2015 whose term of office shall not be liable to retirement by rotation in terms of section 149(13) of the said Act. Declaration has been received to the effect that he meets the criteria of independence as provided in section 149(6) of the said Act. His appointment as an Independent Director shall be placed before the shareholders in the ensuing AGM. He holds the office for five consecutive years with effect from March 31,2015 to March 30, 2020.

Resignation of Director Sh. Sharad Aggarwal,

During the year, Sh. Sharad Aggarwal, an Independent Director, resigned from the Board. The Board of Directors wish to place on record their deep appreciation for the valuable contributions made by Sh. Sharad Aggawal during his tenure as an Independent Director on the Board.

8. Director's Responsibility Statement

The Directors confirm that to the best of knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statement in terms of section 134(3)(c) of the Companies Act, 2013.

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

ii) 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 loss of the company for that period.

iii) That the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities.

iv) That annual accounts have been prepared on 'going concern ' basis.

v) That the Directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

vi) That 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.

vii(a) Audit Observation

The audit observations on the financial statements are suitably explained as and where necessary in the notes on accounts.

9. Directors retiring by rotation

In accordance with the provisions of Section 152 of the Companies Act, 2013 and the company's Articles of Association, Sh. Rajiv Gupta, Chairman and Managing Director and Smt. Arti Gupta, Joint Managing Director retire by rotation in the forthcoming Annual General Meeting and being eligible, offer themselves for re-appointment.

10. Key Managerial Personnel

During the year under review, the company has identified following persons as Key Managerial Personnel..

Sl No. Name of the Person Designation

1. Sh Rajiv Gupta Chairman & Managing Director & CEO

2. Smt. Arti Gupta Joint Managing Director

3. Sh. Arun Mitter Whole Time Director

4. Sh. M.K. Madan Vice President & Company Secretary & CFO

11. Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out annual evaluation of its performance, the directors individually as well as the evaluation of the working of its Audit and Nomination and Remuneration Committees. It has also evaluated the various aspects of the Board's functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance.

The performance evaluation of the Independent Directors was completed. The Chairman and the Non-Independent Directors performance evaluation was also carried out by the Independent Directors. The Board of Directors expressed their satisfaction with the evaluation process.

12. Number of Meetings of the Board

The details of the number of meetings of the Board held during the Financial Year 2014-2015 forms part of the Corporate Governance Report.

13. Particulars of Loans, Guarantees or Investments by the Company

Details of Loans, Guarantees and Investments covered under the provisions of section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements. Refer Note No.26(ii) & 26(xii).

14. Whistle Blower Policy

The company has a Whistle Blower Policy to report genuine concerns of grievances. The Whistle Blower Policy is also available on the website of the company www.mgfltd.com

15. Related Party Transactions

All transactions entered with Related Parties for the year under review were on arm's length basis and in the ordinary course of business. Further, there was no transaction with related parties that may have potential conflict with the interest of the company. Details of related party transactions entered into by the company in the ordinary course of business and at arm's length price are included in the notes forming part of the Financial Statements. Refer Note No. 26(vii)(b). There are no material related party transactions between the company and the related parties as defined under clause 49 of the Listing Agreement. All Related Party Transactions are placed before the Audit Committee as also to the Board for approval.

The Policy on Related Party Transactions as approved by the Board of Directors has been uploaded on the website of the company. None of the Directors has any pecuniary relationship or transactions vis-a-vis the company.

16. Statutory Auditors

Pursuant to the provisions of Section 139 of the Companies Act,2013 and the Rules made thereunder the current auditors of the company M/s S.N.Dhawan & Co, Chartered Accountants ( Firm Regd No.000050N) are eligible to hold office for the second consecutive year (in the term of three consecutive years approved at the last Annual General Meeting) and as such, are recommended for reappointment to audit the accounts of the company for the financial year ending 2015-16. As required under the provisions of section 139 of the Companies Act,2013, the company has obtained written confirmation from M/s S.N. Dhawan & Co, Chartered Accountants that their appointment, if made, would be in conformity within the limits specified in the said section.

The members are requested to appoint M/s. S.N. Dhawan & Co, Chartered Accountants, as auditors for the year 2015-16 and authorize the Board to fix their remuneration.

17. Cost Auditors

The Board of Directors, on the recommendation of Audit Committee, has re-appointed M/s PSK & Associates, Cost Accountants,(Firm Regd No. 000514) as Cost Auditors to audit the cost accounts of the company for the financial year ending 2015-16 at a remuneration of Rs. 40,000 plus service tax, as applicable. As required under the Companies Act, 2013, a resolution seeking member's approval for the remuneration payable to the Cost Auditor forms part of the Notice. As required under the Act and rules made thereunder, the remuneration payable to the Cost Auditors is required to be placed before the members in general meeting for approval. Accordingly, resolution seeking approval by members for the remuneration payable to M/s PSK & Associates, Cost Accountants, is included in the notice.

18. Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules made there under, the company has appointed M/s Anjali Yadav & Associates, a firm of Company Secretaries in Practice, (FCS No.6628 & CP No.7257) to undertake the Secretarial Audit of the company. The Secretarial Audit Report is included as Annexure-D in Form No.MR-3 and forms an integral part of this report.

There is no secretarial audit qualification for the year under review.

19. Internal Auditor & Internal Control

The internal audit has been entrusted to Mr. S.K. Aggarwal, a Chartered Accountant.

The company has in place adequate internal financial controls with reference to the financial statement and is in commensurate with its size, scale and complexities of its operations.

The Audit Committee periodically reviews the internal control systems with the management, internal auditors and statutory auditors and the adequacy of internal audit function, significant internal audit findings and follow ups thereon.

20. Risk Management

The Board of Directors has formed a risk management committee to frame, implement and monitor the risk management plan for the company. The committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The audit committee has additional oversight in the area of financial risks and controls.

The development and implementation of risk management policy has been covered in the management discussions and analysis, which forms part of this report.

21. Board Committees

The Board has the following committees:-

(i) Audit Committee

The audit committee of the Board of the Directors comprises of three (3) directors namely Sh. Bharat Kumar, Sh. Abhiram Seth and Sh. Onkar Nath Aggarwal, all of them being independent directors. Sh. Bharat Kumar is the Chairman of the Audit Committee.

The Board accepts recommendations of the Audit Committee whenever made by the committee.

(ii) Nomination & Remuneration Committee

Nomination & Remuneration Committee comprises of five(5) directors namely, Sh. Rajiv Gupta, Sh. Arun Mitter, Sh. Bharat Kumar, Sh. Abhiram Seth and Sh. Onkar Nath Aggarwal. Out of five Directors, three directors are Independent Directors. Sh. Abhiram Seth, Independent Director, is the Chairman of the Committee.

The Board accepts recommendations of the committee based on the policy on the Directors' appointment and other details as is required under Section 178(4) of the Act in the matter of appointment/reappointments of the Directors, Senior Managers and fixation of remuneration etc.

(iii) Stakeholders Relationship Committee

Stakeholders Relationship Committee comprises of five (5) Directors, namely Sh. Rajiv Gupta, Smt. Arti Gupta, Sh. Arun Mitter, Sh. Bharat Kumar and Sh. Abhiram Seth. Out of five Directors, two directors are Independent Directors. Sh. Abhiram Seth, Independent Director, is the Chairman of the Committee.

The Committee looks into and resolves the grievances of the stakeholders.

(iv) Corporate Social Responsibility (CSR) Committee

Corporate Social Responsibility (CSR) Committee comprises of three Directors, namely, Sh. Abhiram Seth, Sh. Arun Mitter and Sh. Onkar Nath Aggarwal( appointed as an Independent Director on March 31,2015). Out of three directors, two directors are Independent Directors. Sh. Abhiram Seth, Independent Director is the Chairman of the Corporate Social Responsibility Committee.

Corporate Social Responsibility (CSR) Policy

As a part of its initiative under the "Corporate Social Responsibility"(CSR) drive, the company has undertaken projects

in the area of promoting education, renovation of school building and running of school and libraries etc. This is in accordance with Schedule VII of the Companies Act, 2013 and the company's CSR policy. The report on CSR activities as required under Companies (Corporate Social Responsibility Policy) Rules, 2014 is set out as Annexure-'E' forming part of this report.

The Board of Directors on the recommendation of Corporate Social Responsibility Committee, has approved the CSR Policy of the company which is also available on company's website www.mafltd.com.

(v) Risk Management Committee

Risk Management Committee comprises of three(3) Directors, namely, Sh. Bharat Kumar, Sh. Arun Mitter and Sh. Abhiram Seth. Out of three directors, two directors are Independent Directors. Sh. Bharat Kumar, Independent Director, is the Chairman of the Committee.

22. CEO/CFO Certification

The CEO and the CFO of the company have certified to the Board with regard to the compliance made by them in terms of clause 49(V) of the listing agreement.

23. Particulars of Employees

There are no employees in receipt of remuneration which, inter-alia, requires the company to furnish the particulars of Employees as required under Rule 5(2) & 5(3) of the Companies(Appointment and Remuneration of Managerial Personnel )Rules, 2014.

24. Unpaid/Unclaimed Dividend

The respective due dates of transfer of the unclaimed/un-encashed dividend to the Investor Education & Protection Fund("IE&P) of the Central Government are as below

Financial Year to Date of Declaration Due date for transfer which dividend to IE&P Fund relates

2008-2009 25-09-2008 31-10-2015

2009-2010 29-09-2010 04-11-2017

2010-2011 29-09-2011 04-11-2018

As provided under the Companies Act,2013, dividend remaining unclaimed for a period of seven years shall be transferred by the company to the IE&P Fund. In the interest of the investors, the company is in the practice of sending reminders to the investors concerned, before transfer of unclaimed dividend to the IE & P Fund. Unclaimed/un-encashed dividends upto the year 2006-07 have been transferred to the IE&P Fund.

25. Listing of Shares & Listing Fee

The shares of the company are listed on the BSE Limited(BSE) and National Stock Exchange of India Limited(NSE). The listing fee for the year 2015-16 has already been paid to the credit of both the stock exchanges.

26. Dematerialization

Members who have not yet got their shares dematerialized, are requested to opt for the same in their own interest and send their certificate through Depository Participants(s) with whom, they have dematerialized account, to the company's registrar and transfer agents, M/s Alankit Assignments Limited, Alankit Heights,1E/13, Jhandewalan Extension, New Delhi-110055.

Further The Securities and Exchange Board of India(SEBI) has mandated the submission of Permanent Account Number(PAN) by every participant in securities market. Members holding shares in electronic form are, therefore, requested to submit the PAN to their Depository Participant with whom they are maintaining their Demat Accounts. Members holding shares in physical form can submit their PAN details to the company.

27. Compliance of the Statutory Authorities

The company has complied with the requirements of the Stock Exchanges, SEBI and other statutory authorities on all matters relating to the capital markets during the last three years. No penalties or strictures have been imposed on the company by the Stock Exchanges or SEBI or any other statutory authorities relating to the above.

28. Code of Conduct for Directors and Senior Management

The Board of Directors of the company has adopted a Code of Conduct for directors and senior management and the same is available on the website of the company i.e. http// www.mgfltd.com.

29. Insider Trading Code

The Board of Directors in their meeting held on May 14,2015 has adopted a Code of Conduct under SEBI( Prohibition of Insider Trading) Regulations,2015 superseding the 1992 Code. The code is applicable to all designated and connected persons of the company and their immediate relatives, promoters, promoter's group, all directors who are expected to have access to unpublished price sensitive information relating to the company. The company has appointed Mr. M.K. Madan, Vice President & Company Secretary of the company as Compliance Officer under the said regulations.

30. Public Deposits

The company has not taken or invited any fixed deposits from the public during the year under review within the meaning of Section 73 to 76 of the Companies Act, 2013 or rules made thereunder. There are no unclaimed deposits.

31. Conservation of Energy, Technology, Absorption and Foreign Exchange Earnings/Outgo

In terms of the requirements of clause (m) of sub section(3) of Section 134 of the Companies Act,2013, read with the Companies(Accounts)Rules, 2014, the particulars are given as under:-

a) Technology - It is not applicable

b) Conservation of Energy -do-

c) Transactions in Foreign Currency: This Year Previous Year

a) Expenditure in Foreign Currency - -

i ) Repayment of Foreign Currency Loan - -

ii) Interest on Foreign Currency Loan - -

iii) Travelling Expenses 2.04 lacs 13.37 lacs

b) Shares held by Non Resident 187081 191286 Shareholders

No. of Shareholders 31 30

The company had no earnings in foreign exchange.

32. E-mail ID for Investor's Grievances

In compliance of sub clause (f) of Clause 47 of the Listing Agreement, the company has designated an e-mail address i.e. mgfcomplaints@yahoo.co.in for the purpose of registering complaints by investors for redressal of their grievances.

33. Nomination Facility

In case, any of the members wish to avail facility of Nomination,(Form 2B), they are requested to send the duly completed form to the Registrars and/or at the Registered Office of the company.

34. Consolidation of folios

Members who may have more than one folio in their individual name or jointly with other persons mentioned in the same order, are requested to write to the Registrars and Share Transfer Agents indicating the folio numbers for consolidation of similar holdings under one folio.

35. Acknowledgements

Directors place on record their thanks for the assistance and cooperation received from banks and all other customers for their continued support and patronage.

Yours Directors also wish to place on record the dedicated and devoted services rendered by all personnel of the company. .

For and on behalf of the Board FOR THE MOTOR & GENERAL FINANCE LIMITED

Place: New Delhi (RAJIV GUPTA) Dated: August 13, 2015 CHAIRMAN & MANAGING DIRECTOR & CHIEF EXECUTIVE OFFICER DIN:00022964

(ARTI GUPTA) JOINT MANAGING DIRECTOR DIN:00023237


Mar 31, 2014

Dear Members,

The Board of Directors of The Motor & General Finance Limited take pleasure in presenting their 84th Report for the financial year ended March 31,2014.

(Rs. In lacs)

Financial Results Year ended Year ended 31.3.2014 31.3.2013

Gross Profit before depreciation, 907.10 747.50 finance cost and provisioning

Less: Finance Cost (545.41) (304.22) Add: Provisions against doubtful/ irrecoverable assets/loss in value of

investments written back 7.91 -

Less: Depreciation including (32.71) (32.88) impairment and property reserves Provision of tax (65.00) (70.00)

Excess/(short)provision of tax of 4.39 - earlier years

Deferred Tax (Assets) 50.23 -

Net Profit(/Loss) for the year 326.51 329.58

Profit/Loss) brought forward (1719.72) (1983.48)

Total Profit/(Loss) (1393.21) (1653.80) Appropriations

Amount transferred to Reserve - (65.92) Fund u/s 45-IC of the RBI Act,1934 Losses carried forward to Balance Sheet (1393.21) (1719.72)

RESULTS OF OPERATIONS

During the financial year ended March 31,2014, the gross profit before depreciation, finance cost and provisioning was Rs. 907.10 lacs as compared to Rs. 747.50 lacs during the previous year. Reserves and Surplus have increased to Rs. 69.36 crores from Rs. 65.85 crores in the previous year. Further, as the company is no longer a NBFC, Statutory Reserve Fund created u/s 45-1C of the Reserve Bank of India Act, lying credit in the said account amounting to Rs. 16,64,36,883 has been transferred to General Reserves.

The company has already received the completion certificate in respect of project at Shalimar Place, Shalimar Bagh, New Delhi. Efforts are being made to achieve maximum return on the investment. Besides ,the company is exploring options to reduce the over head cost and pursuing all growth opportunities so as to improve its results.

DIVIDEND

To conserve the cash resources, your Directors have not recommended any dividend for the financial year ended March 31,2014.

DIRECTOR''S RESPONSIBILITY STATEMENT AS REQUIRED UNDER SECTION 217(2AA) OF THE COMPANIES ACT,1956

The Director confirm that:

i) In the preparation of the annual accounts for the financial year ended March 31,2014, the applicable accounting standards have been followed and that there are no material departures;

ii) That they have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profits of the company for that period;

iii) That they have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act,1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv) That they have prepared the accounts for the financial year ended March 31,2014 on ''going concern'' basis.

RELATED PARTY TRANSACTIONS

All related party transactions are strictly done on arm''s length basis. Transactions with related parties as per requirements of Accounting Standard AS18 ''Related Party Information'' are disclosed in Note No. 26(XI)( a) to the Financial Statements.

DIRECTORS

Sh. Arun Mitter and Sh. O.N. Aggarwal retire by rotation at the ensuing Annual General Meeting under the erstwhile applicable provisions of the Companies Act,1956. Under Section 149(10) of the Companies Act,2013 and Rules made thereunder, and as per Clause 49 of the Listing Agreement, an Independent Director now shall hold office for a term of 5 (five) consecutive years on the Board of the company and is not liable to determination by retirement of Directors by rotation. In terms of Section 149 and other applicable provisions of the Companies Act,2013, and Rules made thereunder. Sh. Bharat Kumar, Sh. Sharad Aggarwal and Sh. Abhiram Seth are Independent Directors of the Company, whose period of office is liable to determination by retirement of Directors by rotation under the erstwhile applicable provisions of the Companies Act,1956. The company has received declarations from all the Independent Directors of the company confirming that they meet with the criteria of independence as prescribed under sub- Section (6) of Section 149 of the Companies Act,2013. In terms of Section 149 and other applicable provisions of the Companies Act,2013, and Rules made thereunder, the appointments of Sh. Bharat Kumar, Sh. Sharad Aggarwal and Sh. Abhiram Seth as Independent Directors have been approved by the Remuneration Committee and the Board also ensured that their appointments as Independent Directors are in compliance with the requirements under the relevant statutes and that there are appropriate balance of skills, experience and knowledge in the board, so as to enable the Board to discharge its functions and duties effectively.

Notices in writing signifying the intention to offer their candidatures as Independent Directors of the company alongwith the requisite deposit have been received from members of the company in terms of Section 160 of the Companies Act, 2013. Independent Directors being eligible and offering themselves for such appointment, are proposed to be appointed as Independent Directors of the company for a term of 5 (five) consecutive years, with effect from September 18, 2014 upto September 17, 2019.

Sh. O.N. Aggarwal is not meeting the criteria of independence as is provided under Section 149(6) of the Act, as such, he is considered Non Executive Non Independent Director subject to retirement by rotation.

Sh. Rajiv Gupta, Smt. Arti Gupta and Sh. Arun Mitter were reappointed as the Chairman & Managing Director, Joint Managing Director &CEO and Whole Time Director respectively for a period of 3 (three) years w,e.f. April 1, 2014, June 5, 2014 and July 11, 2014 respectively. The said appointments were approved by the members through Postal Ballot dated April 25, 2014.

Sh. Rajiv Gupta and Smt. Arti Gupta were not subject to retirement by rotation as per clause 60 of the Articles of Association of the company under the erstwhile Companies Act,1956. Since none of the Independent Directors are subject to retirement by rotation, Sh. Rajiv Gupta and Smt. Arti Gupta will retire by rotation in terms of Section 152 of the Companies Act,2013. As per the clarification issued by Department of Company Affairs (Circular No.3(No.8/16(1)/61-PR, dated 9th May,1961), Managing Directors'' office does not suffer any break if he retires as a Director under Section 255 of the Companies Act,1956 and is re-elected as a Director in the same meeting.

Attention of the Members is invited to the relevant items in the Notice of the Annual General Meeting for seeking the approval for aforesaid appointments.

AUDITORS

Pursuant to the provisions of Section 139 of the Companies Act,2013 and the Rules made thereunder the current auditors of the company M/s S.N.Dhawan & Co, Chartered Accountants are eligible to hold office for a further period of three years from the conclusion of the ensuing AGM, subject to ratification by the members of the company at each AGM and are recommended for reappointment to audit the accounts of the company for the financial year 2014-15 and to fix their remuneration. As required under the provisions of Section 139 of the Companies Act,2013, the company has obtained written confirmation from M/s S.N. Dhawan & Co, Chartered Accountants that their appointment, if made, would be in conformity with the limits specified in the said section.

The members are requested to appoint M/s.S.N. Dhawan & Co, Chartered Accountants, as auditors of the company

COMPLIANCE OF CLAUSE 31(A) OF THE LISTING AGREEMENT

In terms of Clause 31(a) of the Listing Agreement, the covering letter of the Report in Form B duly signed by the Chairman & Managing Director & CEO, Chief Financial Officer, Chairman of the Audit Committee and countersigned by the Auditors of the company would be filed with the Stock Exchanges alongwith the copy of the Annual Report.

QUALIFIED OPINION IN INDEPENDENT AUDITOR''S REPORT

FORM B

Shortfall in value of Long Term Investments

MANAGEMENT''S REPLY ON THE NOTE

Diminution in value till last financial year was not consistently the same but was showing declining trend given as under:-

Financial Year Rs. In lacs

2010-11 382.24

2011-12 305.98

2012-13 280.42

In the year 2013-14, it has increased to Rs. 511.26 lacs. Based on the market value of the shares held in the group companies, as on the date of audit report i.e. May 30,2014, it has improved marginally and diminution in value is only Rs. 384.03 lacs. The management is actively considering to provide for the shortfall if it continues in the next financial year. Further, at an opportune time, the company may liquidate the investments.

OTHER OBSERVATIONS

The audit observations on the financial statements are suitably explained as and where necessary in the notes on accounts.

UNPAID/UNCLAIMED DIVIDEND

In view of compliance of Section 205C of the Companies Act,1956 read with Investors Education and Protection Fund(Awareness and Protection of the Investors) Rules,2003, the dividend which remains unclaimed and unpaid , if any, for a period of seven years from the date they became due for payment will be transferred to the above fund.

CORPORATE GOVERNANCE

As per the Listing Agreement with the Stock Exchanges, Auditor''s Certificate regarding the compliance of conditions of Corporate Governance(Annexure"A") and Management Discussion and Analysis Report(Annexure ''B'') forms part of this report.

DEMATERIALISATION

Members who have not yet got their shares dematerialized, are requested to opt for the same in their own interest and send their certificate through Depository Participants(s) with whom, they have dematerialized account, to the Company''s Registrar and Transfer Agents, M/s Alankit Assignments Limited, Alankit Heights, 1E/13, Jhandewalan Extension, New Delhi-110055.

Further The Securities and Exchange Board of India(SEBI) has mandated the submission of Permanent Account Number(PAN) by every participant in securities market. Members holding shares in electronic form are, therefore, requested to submit the PAN to their Depository Participants with whom they are maintaining their Demat Accounts. Members holding shares in physical form can submit their PAN details to the company.

SECRETARIAL AUDIT

A secretarial audit for the year 2013-14 was carried out by Practising Company Secretary. The said unqualified secretarial audit report forms part of this Annual Report.

The secretarial audit report confirms that the company has complied with all the applicable provisions of the Companies Act,1956, Depositories Act,1996, Listing Agreements with the Stock Exchanges, Securities Contracts(Regulation)Act,1956 and all the regulations of SEBI as applicable to the company, including the Securities and Exchange Board of India(Substantial Acquisition of Shares and Takeovers)Regulations,1997 and the Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations,1992.

COMPLIANCE OF THE STATUTORY AUTHORITIES

The Company has complied with the requirements of the Stock Exchanges, SEBI and Other statutory authorities on all matters relating to the capital markets during the last three years. No penalties or strictures have been imposed on the company by the Stock Exchanges or SEBI or any other statutory authorities relating to the above.

CODE OF CONDUCT FOR DIRECTORS AND SENIOR MANAGEMENT

The Board of Directors of the Company has adopted a Code of Conduct for Directors and Senior Management and the same is available on the website of the Company i.e. http// www.mgfltd.com.

E-mail ID FOR INVESTOR''S GRIEVANCES

In compliance of sub clause (f) to the Clause 47 of the Listing Agreement, the company has designated an e-mail address i.e. mgfcomplaints @yahoo.co.in for the purpose of registering complaints by investors for redressal of their grievances.

NOMINATION FACILITY

In case, any of the members wish to avail facility of Nomination Form(SH-13) alongwith instructions, they are requested to send the duly completed form to the Registrars of the company and/or at the Registered Office of the company.

CONSOLIDATION OF FOLIOS AND AVOIDANCE OF MULTIPLE MAILING

Members who may have more than one folio in their individual name or jointly with other persons mentioned in the same order, are requested to write to the Registrars and Share Transfer Agents indicating the folio numbers for consolidation of similar holdings under one folio.

INTERNAL CONTROL SYSTEM

The company has a system of well established policies and procedures for Internal Control of operations and activities.

COST AUDITORS

The Board on the recommendation of the Audit Committee has as approved M/s PCK and Associates, Cost Accountants to carry out the cost audit for the year 2014-15. Necessary resolution is placed before the shareholders for their appointment.

PUBLIC DEPOSITS

The company has not invited fixed deposits during the year. There are no unclaimed deposits.

CEO/CFO CERTIFICATION

The CEO and the CFO of the company have certified to the Board with regard to the compliance made by them in terms of Clause 49(V) of the Listing Agreement.

PARTICULARS OF EMPLOYEES

There are no employees in receipt of remuneration which, inter-alia, requires the company to furnish the particulars of employees as required by Section 217(2A) of the Companies Act,1956, read with the Companies(Particulars of Employees), Rules,1975

CONSERVATION OF ENERGY, TECHNOLOGY, ABSORPTION AND FOREIGN EXCHANGE EARNINGS/OUTGO.

In terms of the requirements of clause (e) of sub section(1) of Section 217 of the Companies Act,1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors)Rules, 1988, the particulars are given as under:-

a) Technology - It is not applicable

b) Conservation of Energy -do-

c) Transactions in Foreign Currency: This Year Previous Year

a) Expenditure in Foreign Currency - -

i ) Repayment of Foreign Currency Loan - -

ii) Interest on Foreign Currency Loan - -

iii) Travelling Expenses 0.55 lacs 13.37 lacs

b) Shares held by Non Resident Shareholders 191286 189287

No.of Shareholders 30 30

The company had no earnings in foreign exchange.

ACKNOWLEDGEMENTS

Directors place on record their thanks for the assistance and cooperation received from Banks and all other customers for their continued support and patronage.

Yours Directors also wish to place on record the dedicated and devoted services rendered by all personnel of the company.

For and on behalf of the Board FOR THE MOTOR & GENERAL FINANCE LIMITED

Place: New Delhi (RAJIV GUPTA) (ARTI GUPTA) Dated: August 1, 2014 CHAIRMAN & MANAGING JOINT MANAGING DIRECTOR DIRECTOR & CHIEF EXECUTIVE DIN : 00023237 OFFICER DIN : 00022964


Mar 31, 2013

To the Members,

The Directors have pleasure in presenting their Eighty Third (83rd) Annual Report and Audited Accounts for the year ended March 31, 2013.

(Rs. In lacs)

Financial Results Year ended Year ended 31.3.2013 31.3.2012

Gross Profit before depreciation, finance cost and provisioning 747.50 1356.04

Less: Finance Cost (304.22) (59.64)

Add: Provisions against doubtful/ irrecoverable assets/loss in value of investments written back 32.88 16.73

Less: Depreciation including impairment and property reserves (76.56) (142.59)

Provision of Tax (70.00) (215.00)

Excess/(short)provision of tax of earlier years - (2.46)

Net Profit/(Loss) for the year 329.58 953.08

Profit/(Loss) brought forward (1983.38) (2745.08)

Total Profit/(Loss) (1653.80) (1792.76)

Appropriations

Amount transferred to Reserve Fund u/s 45-IC of the RBI Act,1934 (65.92) (190.61)

Losses carried forward to Balance Sheet (1719.72) (1983.37)

FINANCIAL OPERATIONS

Your company has recorded total income of Rs. 399.57 lacs. Basic earnings per share worked out to Rs. 1.70.

Net Worth of the company continues to be positive. Reserves have increased to Rs. 65.85Crores from Rs. 62.30 Crores in the previous year. We are hopeful to present a better picture by realigning our strategies and resources in order to ensure the best returns for our shareholders in the current year and sustain those returns in the long term. We shall explore every opportunity to streamline the operations focusing more in reducing the overhead cost and thus improve performance.

Project at Shalimar Place is nearing completion and the Board of Directors are confident that this project will bring a handsome return on the investments.

DIVIDEND

In view of utilization of the funds in the project and considering that more funds may be required in the future for expansion and growth and at the same time retaining capital to maintain a healthy capital adequacy ratio, Board of Directors have consciously taken a decision to plough back the profits of the company for the year ended March 31,2013 and have accordingly not recommended any dividend for the year.

The company has not been carrying on NBFC activities for quite some time nor it intends to carry on any such activity in the future. Accordingly, Certificate of Registration (COR) held in Category "B" as Non Accepting Deposits Non Banking Finance Company has been surrendered to RBI. It is, as such, no longer a NBFC Company. Formal communication of the cancellation of COR from RBI as on the date of signing of this report is awaited.

DIRECTOR''S RESPONSIBILITY STATEMENT AS REQUIRED UNDER 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 and there are no material departures from the applicable accounting standards;

ii) The Directors have 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 for the company at the end of financial year ended March 31, 2013 and of the Profit of the Company for that period;

iii) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act,1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv) The statement of accounts for the year ended March 31,2013 have been prepared on a Going Concern Basis.

COMPLIANCE OF CLAUSE 31(a) OF THE LISTING AGREEMENT

In terms of Clause 31(a) of the Listing Agreement, Form A &B, duly signed by the Chairman & Managing Director & CEO, CFO, Chairman Audit Committee and the Statutory Auditors of the company would be filed with the Stock Exchanges alongwith the copies of the Annual Report.

INFORMATION AND EXPLANATIONS/OBSERVATIONS IN THE AUDITORS'' REPORT( Form A & B)

a) EMPHASIS OF MATTER IN THE INDEPENDENT AUDIT REPORT FORM A

Non Compliance of RBI''s Prudential Norms in respect of lending to one company

Management''s reply to the Note

The company has surrendered the Certificate of Registration to RBI and ceases to be a NBFC. In view of the above, Non Banking Financial Companies Prudential Norms (Reserve Bank) Directions,1998 have become not applicable.

b) QUALIFIED OPINION IN INDEPENDENT AUDITORS'' REPORT FORM B

Shortfall in value of Long Term Investments

Management''s reply on the Note

Diminution in value is not consistently the same but it shows a declining trend given as under:-

Financial Year Rs. In lacs

2010-11 - 382.24

2011-12 - 305.98

2012-13 - 280.42

Investments in shares is in the group companies which are listed. Market capitalization is negligible as major holding is with the promoters. In view of lesser trading, the quoted value remains more or less the same. At an opportune time, the company may off load the investments. There will be no tax impact.

In terms of RBI Directions, the Auditors have submitted a separate report to the Board of Directors.

AS REGARDS OTHER OBSERVATIONS

The Auditor''s Report and Notes on Accounts for the financial year 2012-13 are self explanatory and therefore do not call for any further comments.

UNPAID/UNCLAIMED DIVIDEND

In view of compliance of Section 205C of the Companies Act,1956 read with Investors Education and Protection Fund(Awareness and Protection of the Investors)Rules,2003, the dividend which remains unclaimed and unpaid , if any, for a period of seven years from the date of its lying unclaimed will be transferred to the above Fund.

CORPORATE GOVERNANCE

As per the Listing Agreement with the Stock Exchanges, Auditor''s Certificate regarding the compliance of conditions of Corporate Governance(Annexure"A") and Management Discussion and Analysis Report(Annexure ''B'') forms part of this report.

DEMATERIALISATION

Members who have not yet got their shares dematerialized, are requested to opt for the same in their own interest and send their certificate through Depository Participants(s) with whom, they have dematerialized account, to the Company''s Registrar and Transfer Agents, M/s Alankit Assignments Limited, 2E/21, Alankit House, Jhandewalan Extension, New Delhi-110055.

Further The Securities and Exchange Board of India(SEBI) has mandated the submission of Permanent Account Number(PAN) by every participant in securities market. Members holding shares in electronic form are, therefore, requested to submit the PAN to their Depository Participants with whom they are maintaining their Demat Accounts. Members holding shares in physical form can submit their PAN details to the company.

SECRETARIAL AUDIT

Secretarial Audit for the year 2012-13 was carried out by Practising Company Secretary. The said secretarial unqualified audit report forms part of this Annual Report.

The secretarial audit report confirms that the company has complied with all the applicable provisions of the Companies Act,1956, Depositories Act,1996, Listing Agreements with the Stock Exchanges, Securities Contracts(Regulation)Act,1956 and all the regulations of SEBI as applicable to the company, including the Securities and Exchange Board of India(Substantial Acquisition of Shares and Takeovers)Regulations,1997 and the Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations,1992.

COMPLIANCE OF THE STATUTORY AUTHORITIES

The Company has complied with the requirements of the Stock Exchanges, SEBI and Other statutory authorities on all matters relating to the capital markets during the last three years. No penalties or strictures have been imposed on the company by the Stock Exchanges or SEBI or any other statutory authorities relating to the above.

CODE OF CONDUCT FOR DIRECTORS AND SENIOR MANAGEMENT

The Board of Directors of the Company has adopted a Code of Conduct for Directors and Senior Management and the same is available on the website of the Company i.e.http// www.mgfltd.com.

E-mail ID FOR INVESTOR''S GRIEVANCES

In compliance of sub clause (f) to the Clause 47 of the Listing Agreement, the company has designated an e-mail address i.e. mgfcomplaints @yahoo.co.in for the purpose of registering complaints by investors for redressal of their grievances.

NOMINATION FACILITY

In case, any of the members wish to avail facility of Nomination Form(Form 2B ) alongwith instructions, they are requested to send the duly completed form to the Registrars of the Company and/or at the Registered Office of the Company.

CONSOLIDATION OF FOLIOS AND AVOIDANCE OF MULTIPLE MAILING

Members who may have more than one folio in their individual name or jointly with other persons mentioned in the same order, are requested to write to the Registrars and Share Transfer Agents indicating the folio numbers for consolidation of similar holdings under one folio.

MCA''S GREEN INITATIVE

The Ministry of Corporate Affairs(MCA), Govt of India, has taken a "Green Initiative in Corporate Goverance" by allowing paperless compliance by companies through electronic mode, vide its circulars dated April 21,2011 and April 29,2011. To take part in the above ''Green Initiative'', your company proposes to send communications/documents including Notice for General Meeting(s) and Annual Report from time to time in electronic mode to those members who have registered their email address with the Company/Depository Participants(DP).

The members who have not yet registered their email address are requested to register/update their email address in respect of equity shares held by them in demat form with their respective DP''s and in the case of physical form with the company or log on to http://www.mgfltd@hotmail.com to register yourself. You can also download the registration form from company''s website http://www.mgfltd.com

PUBLIC DEPOSITS

The company has not accepted any fixed deposits during the year. There are no unclaimed deposits.

DIRECTORS

In accordance with the provisions of Section 255 of the Companies Act,1956 and Article 49 of the company''s Articles of Association, Shri. Arun Mitter, Sh.Bharat Kumar and Sh. Abhiram Seth, Directors of the company retire by rotation and being eligible offer themselves for reappointment.

Directors seeking reappointment, their brief resume, nature of their expertise in specific functional areas, name of the companies in which they hold directorship and the memberships of the committees of the Board and shares held in the company, etc are given in the annexure to the Notice and in a section on Corporate Governance elsewhere in the Annual Report.

CEO/CFO CERTIFICATION

The CEO and the CFO of the company have certified to the Board with regard to the compliance made by them in terms of Clause 49(V) of the Listing Agreement.

PARTICULARS OF EMPLOYEES

There are no employees in receipt of remuneration which, inter-alia, requires the company to furnish the particulars of Employees as required by Section 217(2A) of the Companies Act,1956, read with the Companies(Particulars of Employees), Rules,1975

CONSERVATION OF ENERGY, TECHNOLOGY, ABSORPTION AND FOREIGN EXCHANGE EARNINGS/OUTGO.

In terms of the requirements of clause (e) of sub section(1) of Section 217 of the Companies Act,1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, the particulars are given as under:-

a) Technology - It is not applicable

b) Conservation of Energy -do-

c) Transactions in Foreign Currency:

This Year Previous Year

a) Expenditure in Foreign Currency - -

i ) Repayment of Foreign Currency Loan - -

ii) Interest on Foreign Currency Loan - -

iii) Travelling Expenses 1337326 -

b) Shares held by Non Resident Shareholders 189287 193227

No. of Shareholders 30 30

The Company had no earnings in foreign exchange.

AUDITORS M/s S.N. Dhawan & Co, Chartered Accountants, Statutory Auditors, retire and are eligible for reappointment. A certificate under Section 224(1B) of the Companies Act,1956, has been obtained from them.

ACKNOWLEDGEMENTS

Directors place on record their thanks for the assistance and co-operation received from Banks and all other customers for their continued support and patronage.

Yours Directors also wish to place on record the dedicated and devoted services rendered by all personnel of the Company.



For and on behalf of the Board

FOR THE MOTOR & GENERAL FINANCE LIMITED

Place: New Delhi (RAJIV GUPTA) (ARTI GUPTA)

Dated: June 3, 2013 CHAIRMAN & MANAGING DIRECTOR JOINT MANAGING DIRECTOR & CHIEF EXECUTIVE OFFICER


Mar 31, 2012

The Directors have pleasure in presenting their Eighty Second (82nd) Annual Report and Audited Accounts for the year ended 31st March, 2012.

(Rs. In lacs)

Financial Results Year ended Year ended 31.3.2012 31.3.2011

Gross Profit before depreciation, finance cost and provisioning 1356.04 1273.34

Less: Finance Cost (59.64) (3.13) Add: Provisions against doubtful/irrecoverable assets/loss in

value of investments written back 16.73 146.10

Less: Depreciation including impairment and property reserves (142.59) (115.90)

Provision of Tax (215.00) (232.00)

Excess/(short)provision of tax of earlier years (2.46) -

Net Profit/(loss) for the year 953.08 1068.41

Profit /( Loss) brought forward (2745.84) (3208.45)

Total Profit/(Loss) (1792.76) (2140.04) Appropriations

Amount transferred to Reserve Fund u/s 45-IC of the RBI Act,1934 (190.61) (213.68)

Proposed Dividend and Corporate Tax thereon - (338.70)

Transferred to General Reserves - (53.42)

Losses carried forward to Balance Sheet (1983.37) (2745.84)



FINANCIAL OPERATIONS

Your company has recorded total income of Rs.11.70 Crores (previous year Rs.13 Crores). Basic earnings per share worked out to Rs.4.92 (previous year Rs.5.52). As earlier informed, the net worth of the company remains positive. Reserves have increased to Rs.62.30 Crores (previous year Rs.52.53 Crores)

Every opportunity has been explored to streamline the operations and focussed to reduce the over head cost and improve performance.

As reported last year project at Shalimar Place is nearing completion. Your Directors are confident that the project when completed will yield substantial revenue.

DIVIDEND

Considering the future needs of the company for expansion and growth and plough back the profits of the company for the year ended 31st March, 2012, your Board does not recommend any dividend.

COMPANY'S CATEGORY

The company continues to hold the certificate issued by Reserve Bank of India in Category "B" as Non Accepting Deposits Non Banking Finance Company.

DIRECTOR'S RESPONSIBILITY STATEMENT AS REQUIRED UNDER 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 and there are no material departures from the applicable accounting standards;

ii) The Directors have 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 for the company at the end of financial year ended 31st March,2012 and of the Profit of the Company for that period;

iii) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act,1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv) The statement of accounts for the year ended 31st March,2012 have been prepared on a Going Concern Basis.

AUDITOR'S REPORT INFORMATION AND EXPLANATIONS/OBSERVATIONS IN THE AUDITORS' REPORT. A. ATTENTION/OBSERVATIONS IN THE MAIN AUDITORS' REPORT

a) Para 2 Intercorporate deposits

The attention of the auditors in their report are self explanatory and/or explained suitably in note no. 29 in the notes forming part of the financial statement.

b) Para 3(i)

Shortfall in value of Long Term Investments

In regard to shortfall, management is of the view that these investments are in associate companies which are running satisfactorily on Going Concern basis, the diminitution in value is not of permanent nature and as such no provision for the shortfall has been considered necessary.

c) Para 3(ii)

Non Compliance of RBI's Prudential Norms in respect of lending to one company

Appropriate steps in this direction are being initiated.

Observations in Annexure referred in paragraph 1 of the Auditor's Report(CARO)

d) Para(i)(a) & (b)

Quantitative details of assets on lease

The management carried out physical verification of assets on lease and few confirmations from lessees have since been received.

In terms of RBI Directions, the Auditors have submitted a separate report to the Board of Directors. UNPAID/UNCLAIMED DIVIDEND

In pursuance to compliance of Section 205C of the Companies Act,1956 read with Investors Education and Protection Fund(Awareness and Protection of the Investors)Rules, 2003, the dividend which remains unclaimed and unpaid , if any, for a period of seven years from the date they became due for payment will be transferred to the above Fund.

CORPORATE GOVERNANCE

As per the Listing Agreement with the Stock Exchanges, Auditor's Certificate regarding the compliance of conditions of Corporate Governance(Annexure"A") and Management Discussion and Analysis Report(Annexure 'B') forms part of this report.

DEMATERIALISATION

Members who have not yet got their shares dematerialized, are requested to opt for the same in their own interest and send their certificate through Depository Participants(s) with whom, they have dematerialized account, to the Company's Registrar and Transfer Agents, M/s Alankit Assignments Limited, 2E/21, Alankit House, Jhandewalan Extension, New Delhi-110055.

Further The Securities and Exchange Board of India(SEBI) has mandated the submission of Permanent Account Number(PAN) by every participant in securities market. Members holding shares in electronic form are, therefore, requested to submit the PAN to their Depository Participants with whom they are maintaining their Demat Accounts. Members holding shares in physical form can submit their PAN details to the company.

SECRETARIAL AUDIT REPORT

Secretarial audit for the year 2011-12 was carried out by Ms. Anjali Yadav, Practicing Company Secretary. The said secretarial unqualified audit report forms part of this Annual Report.

The secretarial audit report confirms that the company has complied with all the applicable provisions of the Companies Act,1956, Depositories Act,1996, Listing Agreements with the Stock Exchanges, Securities Contracts(Regulation)Act,1956 and all the regulations of SEBI as applicable to the company, including the Securities and Exchange Board of India(Substantial Acquisition of Shares and Takeovers)Regulations,1997 and the Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations,1992.

COMPLIANCE BY THE COMPANY

The Company has complied with the requirements of the Stock Exchanges, SEBI and Other statutory authorities on all matters relating to the Capital markets during the last three years. No penalties or strictures have been imposed on the company by the Stock Exchanges or SEBI or any other statutory authorities relating to the above.

CODE OF CONDUCT FOR DIRECTORS AND SENIOR MANAGEMENT

The Board of Directors of the Company has adopted a Code of Conduct for Directors and Senior Management and the same is available on the website of the Company i.e. http// www.mgfltd.com.

E-mail ID FOR INVESTOR'S GRIEVANCES

In compliance of sub clause (f) to the Clause 47 of the Listing Agreement, the company has designated an e-mail address i.e. mgfcomplaints @yahoo.co.in for the purpose of registering complaints by investors for redressal of their grievances.

NOMINATION FACILITY

In case, any of the members wish to avail facility of Nomination Form(Form 2B ) alongwith instructions, they are requested to send the duly completed form to the Registrars of the Company and/or at the Registered Office of the Company.

CONSOLIDATION OF FOLIOS AND AVOIDANCE OF MULTIPLE MAILING

Members who may have more than one folio in their individual name or jointly with other persons mentioned in the same order, are requested to write to the Registrars and Share Transfer Agents indicating the folio numbers for consolidation of similar holdings under one folio.

MCA'S GREEN INITIATIVE

In light of the above, those members, who desires to receive notice/documents including Annual Reports through e-mail, are requested to communicate their e-mail ID and changes thereto to the company at their Registered Office or log on to mgfltd@hotmail.com to register yourself. You can also download the registration form from company's website http://www.mgfltd.com

DIRECTORS

In accordance with the provisions of Section 255 of the Companies Act,1956 and Article 49 of the Company's Articles of

Association, Shri. O.N. Aggarwal, Sh. Bharat Kumar and Shri Sharad Aggarwal, Directors of the Company retire by rotation and being eligible offer themselves for reappointment.

Directors seeking reappointment, their brief resume, nature of their expertise in specific functional areas, name of the companies in which they hold directorship and the memberships of the Committees of the Board and shares held in the company, etc are given in the Explanatory Statement in the Notice and in a section on Corporate Governance elsewhere in the Annual Report.

CEO/CFO CERTIFICATION

The CEO and the CFO of the Company have certified to the Board with regard to the compliance made by them in terms of Clause 49(V) of the Listing Agreement.

PARTICULARS OF EMPLOYEES

There are no employees in receipt of remuneration which, inter-alia, requires the company to furnish the particulars of Employees as required by Section 217(2A) of the Companies Act,1956, read with the Companies(Particulars of Employees), Rules,1975

CONSERVATION OF ENERGY, TECHNOLOGY, ABSORPTION AND FOREIGN EXCHANGE EARNINGS/OUTGO.

In terms of the requirements of Clause (e) of sub section(1) of Section 217 of the Companies Act,1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors)Rules, 1988, the particulars are given as under:-

a) Technology - Being a finance company, the same is not applicable

b) Conservation of Energy -do-

c) Transactions in Foreign Currency: This Year Previous Year

a) Expenditure in Foreign Currency - - i) Repayment of Foreign Currency Loan - -

ii) Interest on Foreign Currency Loan - -

iii) Travelling Expenses - Rs.17.13 lacs

b) Shares held by Non Resident Shareholders 193227 190674 No. of Shareholders 30 30

The Company had no earnings in foreign exchange.

AUDITORS

M/s S.N. Dhawan & Co, Chartered Accountants, Statutory Auditors, retire and are eligible for reappointment. A certificate under Section 224(1B) of the Companies Act,1956, has been obtained from them.

ACKNOWLEDGEMENTS

Directors place on record their thanks for the assistance and cooperation received from Banks and all other customers for their continued support and patronage.

Yours Directors also wish to place on record the dedicated and devoted services rendered by all personnel of the Company.

For and on behalf of the Board

FOR THE MOTOR & GENERAL FINANCE LIMITED

Place: New Delhi (RAJIV GUPTA) (ARTI GUPTA)

Dated: August 23, 2012 CHAIRMAN & MANAGING DIRECTOR JOINT MANAGING DIRECTOR &CHIEF EXECUTIVE OFFICER

 
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