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Directors Report of RCL Retail Ltd.

Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting the Fifth Annual Report together with Audited accounts for the year ended 31.03.2015.

FINANCIAL RESULTS:

The summarized financial results for the year ended 31.03.2015 and for the previous year 31.03.2014 are as under:

Financial Results Amount (In INR)

31st March, 2015 31st March, 2014

Income 18,876,198 105,158,537

Less: Expenditure 18,806,927 108,890,179

Profit/(Loss) before tax 69,271 (37,31,642)

Less: Current Tax 152,000 875,000

Less: Deferred Tax (144,012) (43,455)

Profit/(Loss) after tax 61,283 (45,63,1877

STATE OF AFFAIRS OF THE COMPANY & CHANGE IN NATURE OF BUSINESS:

The Company is trading in ready to eat food products and processed foods. There is no change in the nature of business during the year under review.

DIVIDEND:

In order to plough back the profits, the directors do not recommend any dividend for the year.

DEPOSITS:

The company has not accepted or invited any deposits under the provisions of the Companies Act, 2013, and rules related thereto.

EXTRACT OF ANNUAL RETURN

The extract of the Annual Return in form MGT 9 for the year ended 31.03.2015 is attached as Annexure "A".

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES:

The Company is not having any subsidiary, associate and joint venture company. Hence, the reporting under this clause does not arise.

MATERIAL CHANGES AND COMMITMENTS:

No material changes and commitments which could affect the Company's financial position have occurred between the end of the financial year of the Company and the date of this report.

PARTICULARS OF LOANS, GUARANTEES, INVESTMENTS UNDER SECTION 186:

The Company has advanced loans and made investment during the year under review in Compliance with provisions of Section 186 of the Act.

SHARE CAPITAL:

The Company during the year under review has not issued any Sweat Equity Shares or Shares with Differential Rights or under Employee Stock Option Scheme nor did it Buy Back any shares.

DIRECTORS & KEY MANAGERIAL PERSONNEL:

The Board of Directors of the Company comprises of Six Directors out of which two are Independent Director, two are non-executive promoter director, one is executive promoter director and one is non-executive non independent director.

a. APPOINTMENT / RE-APPOINTMENT:

In order to comply with provisions of Section 149 and Clause 52 of the Listing Agreement, the Board of Directors at their meeting held on 30th March, 2015 and based on the recommendation of the Nomination and Remuneration Committee, appointed Smt. Kushbu as Additional / Woman Director of the Company with effect from 30th March, 2015. Pursuant to Section 161 of the Companies Act, 2013, she holds office upto the date of ensuing Annual General Meeting. Your Board recommends her continuation as Director of the Company.

b. KEY MANAGERIAL PERSONNEL:

In order to comply with the provisions of Section 203 of Companies Act, Shri. Nitesh Ratanchand Lodha, Managing Director of the Company was designated as Key Managerial Personnel and Shri. Kishan Sunil Bhagat was appointed as Chief Financial Officer (CFO) with effect from 30th March, 2015. However, Mr. Kishan Sunil Bhagat resigned w.e.f. 16.08.2015

c. BOARD MEETINGS:

Eleven Board Meetings were held during the year under review and the gap between two meetings was not more than 120 days.

d. DECLARATION RECEIVED FROM INDEPENDENT DIRECTOR ON ANNUAL BASIS:

As required under Section 149(7) all the Independent Directors of the Company have submitted their annual declaration stating that they meet the criteria of independence as stated Section 149(6) of the Companies Act, 2013.

e. COMMITTEES OF THE BOARD:

During the year under review, the terms of reference of the Committee were aligned with the requirements of Clause 52 of the Listing Agreement and the provisions of Companies Act, 2013. A detailed note on the Committees of the Board of Directors is given in the Corporate Governance Report forming part of the Annual Report.

f. BOARD EVALUATION

Pursuant to Section 134 of Companies Act, 2013 the Board of Directors has carried out annual performance evaluation of the Board, its Committees, and Directors individually, as per the criteria laid down by the Nomination and Remuneration Committee.

Accordingly, the Independent Directors of the Company at their separate meeting evaluated the performance of non-independent directors and the Board as a whole. They also evaluated the performance of Chairman of the Company and flow of information from the Management to the Board.

DIRECTORS' RESPONSIBILITY STATEMENT:

To the best of their knowledge, belief and according to the information's and explanations obtained by them, the Directors pursuant to Section 134 of the Companies Act, 2013 hereby state that:

1) in the preparation of the annual accounts, the applicable accounting standards have been followed and no material departures have been made for the same.

2) the directors had selected appropriate accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at 31st March 2015 and of the Profit of the Company for the year ended 31st March 2015.

3) the directors had taken proper and sufficient care for maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities,

4) the annual accounts have been prepared the annual accounts on a going concern basis

5) the directors, had laid down proper and sufficient internal financial controls and policies and procedures of such internal financial controls are adequate and operating effectively. *

6) 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.

AUDITORS:

M/s. Krishnan & Giri, Chartered Accountants, Chennai (FRN: 001512S), Statutory Auditors of the company, were appointed in the 4th Annual General Meeting of the Company for a term of five years from the conclusion of the said Annual General Meeting as per the provisions of Companies Act, 2013, subject to ratification by shareholders in every subsequent Annual General Meeting. The Board of Directors recommends the Shareholders to ratify the appointment of Statutory Auditors for the financial year 2015-2016 and fix their remuneration.

REPLY TO AUDITORS REMARK:

S.No Auditors remark Reply

1. According to the information and explanations The Company is taking given to us, excepting income tax dues of Rs. necessary steps to 1,20,420/- for Assessment year 2012-13 and remit the same. TDS of Rs.2,40,416/- (TDS of Rs.2,40,416/- has been paid subsequently before completion of the audit) there are no other arrears of undisputed statutory dues including Income Tax, Sales Tax, Customs Duty, Provident Fund and Employees' State Insurance outstanding as on 31st March, 2015 for a period of more than six months from the date they became payable.

SECRETARIAL AUDIT

Pursuant to provisions of Section 204 of the Companies Act, 2013, read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, your Company engaged the services of M/s. A.KJAIN & ASSOCIATES, Company Secretaries in Practice, Chennai to conduct the Secretarial Audit of the Company for the financial year ended March 31, 2015. The Secretarial Audit Report (in Form MR-3) is attached as Annexure "B" to this Report.

COMMENTS ON SECRETARIAL AUDITORS' REPORT

The Company is taking necessary steps to comply with the provisions of Section 149, 203 of the Companies Act, 2013 and the Listing Agreement. The Board of Directors will ensure that the necessary forms are filed with the Registrar of Companies wherever applicable.

SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS:

The Company has not received any significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company's operation in future.

PARTICULARS OF EMPLOYEES:

None of the employees draws remuneration of Rs. 500,000/- or above per month and Rs. 6,000,000/- or above per year. Hence, details of the employees of the Company as required pursuant to 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is not furnished.

Having regard to the provisions of Section 136(1) read with its relevant proviso of the Companies Act, 2013, the disclosure pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, forming part of the Annual Report, is available for inspection at the registered office of the company during working hours. Any member interested in obtaining such information may write to the Company Secretary and the same will be furnished without any fee and free of cost.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EARNINGS AND OUTGO:

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014, is annexed herewith as Annexure - "C. "

RELATED PARTY TRANSACTIONS:

The transaction with the related parties entered into during the period under review had been in the ordinary course of business and at arm's length basis. The details of related party transaction pursuant to clause (h) of sub -section 134 of the Act, is enclosed in Form AOC-2 as Annexure - "D"

MANAGEMENT DISCUSSION AND ANALYSIS:

Management Discussion and Analysis Report, emphasizing the business details, is attached and forms part of the report.

CORPORATE GOVERNANCE

The Report on Corporate Governance and Auditors certificate on Compliance with the Code of Corporate Governance are provided and forms part of this report.

LISTING WITH STOCK EXCHANGE

The Company's equity shares are listed in BSE SME Platform.

CORPORATE SOCIAL RESPONSIBILITY (CSR):

The provisions of Section 135 of the Companies Act 2013 pertaining to Corporate Social Responsibility are not applicable to the Company.

VIGIL MECHANISM:

In Compliance of Section 177 of Companies Act, 2013 and in terms of Clause 52 of the Listing Agreement, the Company has set up a Whistle Blower policy. In terms of the said policy the Directors and employees are given direct access to the Chairman of the Audit Committee to report genuine concerns or grievances. Adequate safeguards are in place against victimization of employees who availed the mechanism.

RISK MANAGEMENT POLICY AND INTERNAL FINANCIAL CONTROL:

The Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. These are discussed at the meetings of the Audit Committee and the Board of Directors of the Company. The Audit Committee has also revisited the Risk Management Policy and has taken steps to strengthen the Risk Management process in keeping with the changes in the external environment and business needs.

The Company's internal control systems are commensurate with the nature of its business and the size and complexity of its operations. In addition to the Internal Control Systems, the Board has laid emphasis on adequate Internal Financial Controls to ensure that the financial affairs of the Company are. carried out with due diligence. These are routinely tested and certified by the Internal Auditors. Significant audit observations and follow up actions thereon are reported to the Audit Committee.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROBATION AND REDRESSAL), ACT, 2013:

The Company has in place an Anti Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal), Act, 2013. During the year under review no complaints have been received.

ACKNOWLEDGEMENT:

Your Directors take this opportunity to express their thanks to the Shareholders, Customers, Suppliers Banks and Government for their valuable assistance and support.

Your Directors wish to place on record their appreciation of the sincere efforts put in by the employees of the Company at all levels.

On Behalf of the Board

For RCL RETAIL LIMITED

Sd/- Sd/-

Place: Chennai Nitesh R Lodha Vimal Chand Chordia

Date: 14.11.2015 Managing Director Director




Mar 31, 2014

Dear Members,

The Directors are pleased to present the Fourth Annual Report of your Company together with the Audited Statement of Accounts and the Auditors'' Report of your company for the financial year ended, 31st March, 2014.

The summarized financial results for the year ended 31st March, 2014 are as under:

FINANCIAL RESULTS:

Financial Results (Rs. In ''000) 31st March 31st March, 2014 2013

Profit/(Loss) before Interest, (432 14) 494170 Depreciation & Tax f )

Less: Interest 2803.13 1763.43

Profit/(Loss) before Depreciation & (3235.27) 3178.27 Tax

Less: Depreciation 496.37 613.181

(3731.64)

PROFIT/(LOSS) FOR THE YEAR 2565.09

BEFORE EXCEPTIONAL ITEMS .

PROFIT/(LOSS ) FOR THE YEAR (3731.64) 2565.09

BEFORE TAX

Less: Tax 875.00 975.00

(43.46) (77.66)

Less: Provision for Deferred Taxation

Profit/(Loss) after tax (4563.19) 1667.74

REVIEW OF OPERATION:

During the year under review, the Company has achieved a sales turnover of Rs.9,80,82,182/- which is almost double the time of sales figure comparing to the previous year. Your Directors are continuously looking for avenues for future growth of the Company in Retail industry.

DIVIDEND:

Your Directors do not recommend any dividend for the year under review.

DEPOSITS:

Your Company has neither invited nor accepted deposits from the public.

AUDITORS:

M/s. Krishnan & Giri., Chartered Accountants, Chennai who are the statutory auditors of the Company, hold office till the conclusion of the forthcoming AGM and are eligible for re-appointment. M/s. Krishnan & Giri., Chartered Accountants, Chennai have confirmed that the re-appointment, if made would be within the prescribed limits under Section 141 of the Companies Act, 2013.

Pursuant to the provisions of section 139 of the Companies Act, 2013 and the Rules made thereunder, it is proposed to appoint M/s. M/s. Krishnan & Giri., Chartered Accountants, Chennai as statutory auditors of the Company from the conclusion of the forthcoming AGM till the conclusion of the twenty-Seventh AGM, subject to ratification of their appointment at every AGM.

The Board recommends their reappointment as Statutory Auditors of the Company. The report of Auditors and notes forming part of the Accounts are attached along with the Annual Report.

As far as para 9(a) of Auditors report is concerned, your company is taking steps to make statutory payment to the authorities.

DIRECTORS:

The Companies Act, 2013 provides for appointment of Independent Directors. As per Section 149, Independent Directors shall hold office for a term of upto 5 (five) consecutive years on the Board of a Company; and shall be eligible for re-appointment on passing a special resolution by the shareholders of the company. Further the Act provides that, no independent director shall be eligible for more than two consecutive terms of five years & the provision of the Companies Act, 2013 on retirement by rotation shall not apply to such independent Directors.

Pursuant to the notification of Section 149 and other applicable provisions of the Companies Act, 2013 read with Rules thereon, your Directors are seeking appointment of Mr. Ganpath Raj Kothari and Mr. Vimal chand Chordia, as Independent Directors for five consecutive years. The aforesaid non-executive independent directors have given their consent to act as Independent Directors of the company and made a declaration that they meet the criteria of Independence.

Mr. Suresh Jain and Mr. Kamalesh Jain were appointed as additional directors during the period under review. Your Board recommend for their confirmation as directors liable to retire by rotation.

Mr. Shreyans Lodha and Mr. Pramod Kumar Agarwal resigned during the period under review.

The profile of the Directors seeking appointment / reappointment and other information have been detailed in the Notice. Your Board recommends the above appointments/reappointment of Directors in the best interest of the Company.

LISTING FEES:

Your Company paid the Listing Fees to the Exchange for the year 2014-15 in terms of listing agreement entered with the said Stock Exchange.

Your company utilized the issue proceeds so far for the purpose of establishing two retail outlets out of eight retail outlets as per its public issue objects. As regards setting up of food grain processing unit it is observed that due to increased urbanization and migration, the location of the property owned by the company has turned out to be a residential place, consequently your company has received severe objects from the locality and therefore it has become unfit for our object. In addition to that, the cost required for converting the land, leveling, fencing and construction of factory building is also increased than estimated and thus the project at the said premises is not feasible due to escalation of costs and objections.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

As required under Clause 52 of the Listing Agreement with the Stock Exchange, the Management Discussion and Analysis of the financial condition and results of consolidated operations of the Company under review, is annexed and forms an integral part of the Directors'' Report.

DIRECTORS RESPONSIBILITY STATEMENT:

In accordance with the provisions of Section 217(2AA) of the Companies Act, 1956, your directors state;

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

b. that 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 of the company for the period;

c. that the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

d. that the directors had prepared the annual accounts on a going concern basis.

PARTICULARS OF EMPLOYEES:

No employee is in receipt of remuneration in excess of limits prescribed under 217(2A) of the Companies Act, 1956.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION:

Being Retail Company, the company has no activity in relation to conservation of energy and technology absorption.

FOREIGN EXCHANGE EARNINGS AND OUTGO:

The company has not earned or spent any foreign exchange during the year under review.

CORPORATE GOVERNANCE

A report on Corporate Governance along with a Certificate from the Auditors of the Company regarding the compliance with conditions of Corporate Governance as also the Management Discussion and Analysis Report as stipulated under Clause 52 of the Listing Agreement are annexed to this Report.

DEPOSITORY SYSTEM

Your Company''s Shares are under compulsory demat mode and members are requested to dematerialize their shares for operational convenience.

INSIDER TRADING REGULATIONS

Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations, 1992, as amended from time to time, the code of conduct for prevention of insider trading and the code for corporate disclosures are in force.

CORPORATE SOCIAL RESPONSIBILITY

Corporate Social Responsibility is commitment of the Company to improve the quality of life of the workforce and their families and also the community and society at large. The Company believes in undertaking business in such a way that it leads to overall development of all stake holders and society.

CHANGE OF NOMENCLATURE "REMUNERATION COMMITTEE" TO "NOMINATION & REMUNERATION COMMITTEE"

In terms of Section 178 of the Companies Act, 2013 & other applicable provisions, if any, Board of Directors at the Board Meeting held on 30.05.2014 has renamed the existing "Remuneration Committee" of the Board of Directors as "Nomination & Remuneration Committee". There was no change in the members of the Committee.

CHANGE OF NOMENCLATURE "INVESTOR GRIEVANCE & SHARE TRANSFER COMMITTEE" TO "STAKEHOLDERS RELATIONSHIP COMMITTEE"

In terms of Section 178 of the Companies Act, 2013 & other applicable provisions, if any, Board of Directors at their meeting held on 30.05.2014 renamed the existing "Investor Grievance & Share Transfer Committee" as "Stakeholders Relationship Committee".

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report, as required under the Listing Agreement is enclosed in this Annual Report and forms part of this Report.

ACKNOWLEDGMENT:

Your Directors place on record their appreciation for the continued co-operation extended to the Company by its Bankers, Shareholders and the employees of the Company.

By order of the Board For RCL RETAIL LIMITED

Sd/- Sd/- Managing Director Director

Place: Chennai Date: 05.09.2014

 
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