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Directors Report of Sastasundar Ventures Ltd.

Mar 31, 2023

The Directors are pleased to present the Thirty-fourth (34^th) Annual Report together with Audited Annual Financial Statements (including Audited Consolidated Financial Statements) of the Company for the Financial Year ended 31st March, 2023.

financial highlights (Rs. in Lakhs)
Particulars	Standalone		Consolidated
	FY 2022-23	FY 2021-22	FY 2022-23	FY 2021-22 (Restated)
Total Revenue	-	-	1,03,981.84	63,142.82
Profit/(Loss) before Interest, Depreciation & Tax	82.28	(14.64)	(2,032.32)	(3,702.30)
Less: Depreciation	15.77	17.66	819.75	415.62
Less: Interest	1.53	1.38	86.76	163.62
Profit/(Loss) before share of profit/(loss) of an associate; exceptional items and tax	64.98	(33.68)	(2,938.83)	(4,281.54)
Share of Profit/ (Loss) on Associates accounted for using equity method	-	-	(8,489.82)	(518.61)
Profit/ (Loss) Before Exceptional Item and Tax	64.98	(33.68)	(11,428.65)	(4,800.15)
Exceptional Items	-	-	(796.45)	1,15,748.53
Profit /(Loss) before Tax	64.98	(33.68)	(12,225.10)	1,10,948.38
Less: Tax Expenses
- Current Tax	-	-	22.18	13,075.27
- Deferred Tax	-	-	(2,287.32)	11,354.15
- Short/(Excess) Provision for Tax relating to prior years	-	5.37	(13.04)	7.74
Profit/(Loss) after Tax	64.98	(39.05)	(9,946.92)	86,511.22
Other Comprehensive Income
A (i) Items that will be not reclassified subsequently to profit or loss
(a) Remeasurement gain/loss on defined benefit plans	(4.43)	(4.20)	(122.74)	(25.94)
(b) Share of Other Comprehensive Income in Associate Company	-	-	2.43	-
(ii) Income tax relating to items that will not be reclassified to profit or loss	-	-	0.78	0.24
B (i) Items that will be reclassified subsequently to profit or loss	-	-	-	-
(a) Remeasurement gain/loss on defined benefit plans	-	-	-	-
(b) Share of Other Comprehensive Income in Associate Company	-	-	-	-
(ii) Income tax relating to items that will not be reclassified to profit or loss	-	-	-	-
Other Comprehensive Income	(4.43)	(4.20)	(119.53)	(25.70)
Total Comprehensive Income	60.55	(43.25)	(10,066.45)	86,485.52
Profit/ (Loss) for the year attributable to
Owner of the company	64.98	(39.05)	(7,221.05)	62,680.54
Non-controlling Interest	-	-	(2,725.87)	23,830.68
Total Comprehensive income for the period attributable to
Owner of the company	60.55	(43.25)	(7,310.18)	62,660.55
Non-controlling Interest	-	-	(2,756.27)	23,824.97

Consolidated Financial Statements

As required under SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 [hereinafter referred to as "SEBI (LODR) Reg, 2015"] and in accordance with the Indian Accounting Standard notified under the Companies (Indian Accounting Standards) Rules, 2015, Consolidated Financial Statements of the Company and its subsidiaries form part of the Annual Report and are reflected in the consolidated financial statements of the Company. These statements have been prepared on the basis of audited financial statements received from the subsidiary companies as approved by their respective Boards.

dividend

The Board of Directors do not recommend any dividend for the financial year 2022-23.

In accordance with Regulation 43A of SEBI (LODR) Reg, 2015 your company has adopted Dividend Distribution Policy with effect from June 22, 2021. The Policy lays down various parameters to be considered by the Board before declaration/recommendation of dividend to the members of the Company. The Dividend Distribution Policy is available on the website of the Company at https://www.sastasundarventures.com/Pdf/Dividend_Distribution_Policy.pdf

transfer to reserve

The Company has not transferred any amount to the General Reserve Account during the financial year ended 31st March, 2023. STATE OF COMPANY''S AFFAIRS & OPERATIONS

During the financial year under review your Company, made significant progress on advancing its strategies. With the strategic partnership with the Flipkart group, the Company is well positioned to build upon momentum and drive long term, sustainable growth. The Company is committed to build a longterm business that offers a data-driven, digital supply chain for pharmaceuticals, diagnostics and wellness in India, catering to both B2B and B2C spaces.

On a standalone basis, the revenue of your Company is NIL as against NIL during the previous year. EBIDTA for the current year is Rs 82.28 Lakhs as compared to EBIDTA of Rs (14.64) Lakhs during the previous financial year. The net profit for the year under review is Rs 64.98 Lakhs as against Rs (39.05) Lakhs in the previous year.

On a consolidated basis, the revenue of your Company stood at Rs 1,03,981.84 Lakhs as against Rs 63,142.82 Lakhs during the previous year. The EBIDTA for the current year is Rs (2,032.32) Lakhs as compared to EBIDTA of Rs. (3,702.30) Lakhs during the previous financial year. The net loss for the year under review is Rs (9,946.92) Lakhs as against profit of Rs 86,511.22 Lakhs in the previous year.

composite scheme of arrangement

During the year under review the board of directors of your Company at its meeting held on 27^th March, 2023 has approved the Composite Scheme of Arrangement between Sastasundar Ventures Limited ("SVL" or "Demerged Company" or "Amalgamated Company"), Microsec Resources Private Limited ("MRPL" or "Resulting Company") and Sastasundar Healthbuddy Limited ("SHBL" or "Amalgamating Company") and their respective shareholders and creditors ("Scheme of Arrangement" / "Scheme") under Section 230-232 and other applicable provisions of the Companies Act, 2013.

The composite scheme of arrangement after the approval of the Board on 27^th March, 2023 was then filed with both the Stock Exchanges for obtaining their No Objection Certificate in terms of the SEBI Master Circular for Scheme of Arrangement. However, the Stock Exchange had returned the Scheme to the Company with the instruction to re-file the same along with audited financials of the unlisted companies involved in the Scheme. Therefore, the Scheme was again placed before the Board in its meeting held on 14^th July, 2023 for their approval for re-filing to the Stock Exchange along with audited financial statement for the Financial Year 2022-23 of unlisted companies involved in the Scheme.

The proposed Scheme entails the following:

â¢ Demerger of Financial Services Business Undertaking from Sastasundar Ventures Limited to Microsec Resources Private Limited; and

â¢ Amalgamation of Sastasundar Healthbuddy Limited with Sastasundar Ventures Limited, subsequent to the completion of demerger referred above.

Purpose and Rationale for the Demerger of the Financial Services Business from SVL to MRPL

SVL is a multi-business corporate engaged in the business of providing healthcare and financial services. The aforesaid businesses of SVL have been nurtured over a period of time and are currently at different stages of growth. This scheme is in the best interest of the Companies and their respective shareholders, employees, creditors and other stakeholders on account of following benefits:

(a) Demerger shall lead to creation of a separate, distinct and focused entity housing the Financial Services Business leading to greater operational efficiencies;

(b) Segregating the businesses would enable independent business opportunities, attracting different sets of strategic partners and other stakeholders and would bring about greater internal control on business processes / ease in decision making;

(c) Independent group structure for each of the Business Segments of the group will ensure required depth and focus on each of the segments and adoption of strategies necessary for the growth of the respective segments. The structure shall provide independence to the management in decisions regarding the use of their respective cash flows for dividends or capital expenditure in their respective businesses; and

(d) Cost savings are expected to flow from more focused operational efforts, rationalization, standardization and simplification of business processes, productivity improvements, and the elimination of duplication, and optimum rationalization of administrative expenses and utilization of human resources.

Purpose and Rationale for the Amalgamation of SHBL with SVL

SHBL is engaged in the business of wholesale trading of medicinal products, healthcare products and other Over the Counter (OTC) products and food processing unit. The aforesaid business of SHBL has been nurtured over a period of time. This scheme is in the best interest of the Companies and their respective shareholders, employees, creditors and other stakeholders on account of following benefits:

(a) SHBL is the main operational entity in the Healthcare Segment of the group and therefore it''s Amalgamation with SVL shall result in maximization of overall shareholder value;

(b) Achieve simplification of group structure, optimal utilization of resources, better administration and cost reduction;

(c) Creating synergies in operations, benefit of scale and enhancing competitive strength since duplication of administrative efforts, legal and regulatory compliances will be unified; and

(d) Independent group structure for each of the business segments of the group (i.e., Healthcare Business and the Financial Services Business) will ensure required depth and focus on each of the segments and adoption of strategies necessary for the growth of the respective segments. The structure shall provide independence to the management in decisions regarding the use of their respective cash flows for dividends or capital expenditure in their respective businesses.

The aforesaid scheme is subject to necessary approvals from the BSE Limited, the National Stock Exchange of India Limited, the Securities and Exchange Board of India, the NCLT and other statutory or regulatory authorities.

deposits

During the year under review, the Company has neither accepted nor renewed any deposits from the public within the meaning of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014.

share capital

The paid up Equity share capital of the Company as at 31st March, 2023 stood at Rs. 31.81 crores divided into 31810500 equity shares of face value of Rs. 10 each. There has been no change in the Authorised and Paid up Share Capital of the Company during the year under review.

A) Issue of equity shares with differential rights: The Company did not issue equity shares with differential voting rights during the financial year 2022-23.

B) Issue of sweat equity shares: The Company did not issue sweet equity shares during the financial year 2022-23.

C) Issue of employee stock options: The Company did not issue stock options during the financial year 2022-23.

D) Provision of money by Company for purchase of its own shares by employees or by trustees for the benefit of employees: The Company does not have a scheme for purchase of its own shares by employees or by trustees for the benefit of employees.

CHANGE IN NATURE OF BUSINESS, IF ANY

There has been no change in the nature of business of the Company during the financial year ended 31st March, 2023.

LOANS, GUARANTEES AND INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the note no. 5 to the Financial Statements.

material changes and commitments

No material changes and commitments affecting the financial position of your Company have occurred between the end of the financial year of the Company to which financial statements relates and the date of this report.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATOR/COURTS/TRIBUNALS IMPACTING THE GOING CONCERN

status and company''s operations in future

There were no significant and material orders passed by the Regulators or Courts or Tribunals during the year impacting the going concern status and the operations of the Company in future.

internal control systems and their adequacy

Your Company''s Internal Control Systems are commensurate with the nature, size and complexity of its business and ensure proper safeguarding of assets, maintaining proper accounting records and providing reliable financial information.

The Audit Committee have laid down internal financial controls to be followed by the Company and such policies and procedures have been adopted by the Company for ensuring the orderly and efficient conduct of its business, including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

An external independent firm carries out the internal audit of the Company operations and reports to the Audit Committee on a regular basis. Internal Audit provides assurance on functioning and quality of internal controls along with adequacy and effectiveness through periodic reporting.

However, the management of subsidiary of the company, during the year has detected misappropriation of cash collections from customers aggregating to Rs. 796.45 lakhs (Sastasundar Healthbuddy Limited- Rs. 161.40 Lakhs) (Retailer Shakti Supply Chain Pvt Ltd - Rs. 635.05 Lakhs) by few employees of the Sastasundar Healthbuddy Limited ("SHBL"), subsidiary of the company and Retailer Shakti Supply Chain Pvt Ltd ("RSCPL "), step down subsidiary of the company. The statutory auditors in this regard have also expressed their adverse opinion, the details of which are given elsewhere in this report. Report on the Internal Financial Control under Section 143(3)(i) of the Companies Act, 2013 is attached as annexure to the Independent Auditors Report of the Consolidated Financial Statement for the FY 2022-23 which is part of the report.

SUBSIDIARY/JOINT VENTURES/ ASSOCIATE COMPANIES:

As on March 31, 2023 the Company has nine subsidiaries (both direct and step down). During the financial year, no company became/ ceased to be subsidiaries, joint ventures and associates.

In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared consolidated financial statements of the Company and all its subsidiaries forms part of the Annual Report. Further a statement containing the salient features of the financial statements of each of the subsidiaries in the prescribed format Form AOC-1, forms part of the Annual Report. The annual accounts of the subsidiary companies will be made available to the shareholders on request and will also be kept for inspection by the shareholders at the registered office of your Company.

Further as per section 136 of the Companies Act, 2013, the audited financial statements, including the consolidated financial statements and related information of the Company are available at our website at www.sastasundarventures.com.

A Policy has been formulated for determining the Material Subsidiaries of the Company pursuant to Regulation 46 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 [hereinafter referred to as "SEBI (LODR) Reg, 2015"]. The said Policy has been posted on the Company''s website at the http://www.sastasundarventures.com/Pdf/SVL_ PolicyforDeterminationofMaterialSubsidiary.pdf

As per the provisions of Regulation 16(1)(c) of the SEBI (LODR) Regulations, 2015, the Company has two material unlisted subsidiary, Sastasundar Healthbuddy Limited and Retailer Shakti Supply Chain Private Limited.

The Company does not have any Joint Venture Company. The Company has one Associate Company i.e. Flipkart Health Limited (formerly Sastasundar Marketplace Limited).

BOARD OF DIRECTORS:

a) Directors and Key Managerial Personnel

As per the provision of the Companies Act, 2013 Mr. Ravi Kant Sharma (DIN: 00364066) retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment. Your Directors recommended the reappointment of Mr. Ravi Kant Sharma as Director.

The tenure of Mr. Banwari Lal Mittal (DIN: 00365809) as Managing Director & CEO expires on 30th June, 2023. The Board of Director at their meeting held on 30th May, 2023, on the recommendation of Nomination and Remuneration Committee and subject to the approval of members, had re-appointed Mr. Banwari Lal Mittal as Managing Director & CEO for a period of 5 years w.e.f. 1st July, 2023 without any remuneration. The approval of members is being sought at the ensuing Annual General Meeting.

None of the Directors of the Company are disqualified for being appointed as Directors, as specified in section 164(2) of the Companies Act, 2013 and Rule 14(1) of the Companies (Appointment and Qualification of Directors) Rules, 2014. Further, in the opinion of the Board, the Independent Directors also possess the attributes of integrity, expertise and experience as required to be disclosed under Rule 8(5)(iiia) of the Companies (Accounts) Rules, 2014.

The details of Director being recommended for reappointment as required under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are contained in the accompanying Notice convening the ensuing Annual General Meeting of the Company. Appropriate Resolution(s) seeking your approval to the re-appointment of Director are also included in the Notice.

Pursuant to Section 203 of the Companies Act, the Key Managerial Personnel of the Company are Mr. Banwari Lal Mittal, Managing Director, Mrs. Manisha Sethia, Chief Financial Officer and Mr. Pratap Singh, Company Secretary.

None of the Directors of the Company receives any commission from the Company.

b) Declaration by the Independent Director(s)

All the Independent Directors have furnished the requisite declarations that they meet the independence criteria as laid down under section 149(6) of the Companies Act, 2013 read with the rules made thereunder and Regulation 16(1)(b) of the SEBI (LODR) Reg, 2015. Further, the Board of Directors has taken on record the declaration and confirmation submitted by the Independent Director under regulation 25(8) after assessing its veracity. The Independent Directors have also submitted a declaration confirming that they have registered their names in the databank of Independent Directors as being maintained by the Indian Institute of Corporate Affairs (IICA) in terms of Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014. The Independent Directors have complied with the code for Independent Director as prescribed under Schedule IV of the Companies Act, 2013.

c) Familiarization Programme undertaken for Independent Director

In terms of Regulation 25(7) of the SEBI (LODR) Reg, 2015, your Company is required to conduct Familiarisation Programme for Independent Directors to familiarise them about your Company including nature of Industry in which your company operates, business model, responsibilities of the Independent Directors, etc. Further, pursuant to Regulation 46 of the SEBI (LODR) Reg, 2015, your Company is required to disseminate on its website, details of familiarization programmes imparted to the Ids including the details of the same. During the year, the Company has organised one familiarisation Programme of the Independent Directors. The details of the familiarisation programme of Independent Directors are provided in the Corporate Governance Report. The link to the details of familiarization programmes imparted to the Independent Directors is http://www.sastasundarventures.com/Pdf/FamiliarizationProgrammeForIndependentDirector.pdf

d) Board Evaluation

The Nomination and Remuneration Committee of the Company has formulated and laid down criteria for Performance evaluation of the Board (including Committees) and every director (including Independent Directors) pursuant to the provisions of Section 134, Section 149 read with the code of Independent Director (Schedule IV) and Section 178 of the Companies Act, 2013 read with Rules framed thereunder and Regulation 19(4) read with Part D of Schedule II of SEBI (LODR) Reg, 2015.

For annual evaluation of the Board as a whole, its Committee(s) and Individual Directors including the Chairman of the Board, the Company has formulated a questionnaire to assist in evaluation of the performance. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

During the year under review, the Independent Directors of the Company reviewed the performance of Non-independent Directors, the board as a whole and the chairperson of the Company, taking into account the views of executive and nonexecutive directors.

e) Remuneration Policy

The Board has on the recommendation of the Nomination & Remuneration Committee adopted the Remuneration Policy, which inter alia includes policy for selection and appointment of Directors, Key Managerial Personnel, Senior Management Personnel and their remuneration. The remuneration policy of the Company aims to attract, retain and motivate qualified people at the Executive and at the Board levels. The remuneration policy seeks to employ people who not only fulfill the eligibility criteria but also have the attributes needed to fit into the corporate culture of the Company. The salient features of the Policy has been disclosed in the Corporate Governance Report, which forms part of this Annual Report. The said policy is available at the weblink: https://sastasundarventures.com/Pdf/SVL_Remuneration_policy.pdf.

meetings of the board of directors and committee

a) Board of Directors

The Board meets at regular intervals to discuss and decide on business policy and strategy apart from other Board business. However, in case of special and urgent business need, the Board''s approval is taken by passing resolutions through circulation, as permitted by law, which are confirmed in the subsequent Board meeting. During the year under review, five Board Meetings were convened and held on 30^th May, 2022, 13^th August, 2022, 14^th November, 2022, 14^th February, 2023 and 27^thMarch, 2023, the details of which are given in the Corporate Governance Report. The meetings were held in compliance with the various provisions of the Act/Listing Regulations.

b) Audit Committee

The composition, number of meetings held and attended and terms of reference of the Audit Committee has been furnished in the Corporate Governance Report forming a part of this Annual Report. There has been no instance where the Board has not accepted the recommendations of the Audit Committee.

c) Nomination and Remuneration Committee

The composition, number of meetings held and attended and terms of reference of the Nomination and Remuneration Committee has been furnished in the Corporate Governance Report forming a part of this Annual Report.

d) Stakeholders Relationship Committee

The composition, number of meetings held and attended and terms of reference of the Stakeholders Relationship Committee has been furnished in the Corporate Governance Report forming a part of this Annual Report.

e) Risk Management Committee

The composition, number of meetings held and attended and terms of reference of the Risk Management Committee has been furnished in the Corporate Governance Report forming a part of this Annual Report.

f) Investment Committee

The composition, number of meetings held and attended and terms of reference of the Investment Committee has been furnished in the Corporate Governance Report forming a part of this Annual Report.

g) Separate Meeting of Independent Directors

The Independent Directors met on 14th November, 2022 and 27th March, 2023 without the attendance of Non-Independent Directors and members of the Management. The Independent Directors at its meeting held on 14^th November, 2022 reviewed the performance of Non-Independent Directors and the Board as a whole, the performance of the Chairman of the Company, taking into account the views of Executive Directors and Non-Executive Directors and assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform their duties. The independent directors at its other meeting held on 27^th March, 2023, reviewed the draft composite scheme of arrangement and fairness opinion for issue of Report from the Committee of Independent Directors

auditors

(a) Statutory Auditors

M/s. JKVS & Co., Chartered Accountants (Firm Registration Number: 318086E), the Statutory Auditors of the Company have been appointed as Statutory Auditors of the Company by the Members of the Company from the conclusion of 33rd Annual General Meeting held on 29th September, 2022 till the conclusion of 38th Annual General Meeting of the Company to be held in the year 2027.

M/s. JKVS & Co., Chartered Accountants, the Statutory Auditors have submitted their Independent Auditor Report for the financial year ended 31st March, 2023 and they have made no qualification, reservation, observation or adverse remarks or disclaimer in their Standalone Audit Report. However, the Consolidated Audit Report for the financial year ended 31st March, 2023 have been qualified on account of qualification in the subsidiary companies accounts, which has been detailed below together with management comments thereof.

Qualification in Consolidated Audit Report of FY 2022-23 and Auditors Opinion on Internal Control systems and their adequacy

The Statutory Auditor in their Consolidated Audit Report for FY 2022-23 has expressed Qualification with respect to Financial Statement of subsidiaries and opinions with respect to internal controls. The management of the subsidiaries believes that the Company has adequate internal financial control system in place which operates effectively. The Internal Audit team monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit, management undertakes corrective actions in their respective areas and thereby strengthens the controls.

i) The Independent Auditors of Sastasundar Healthbuddy Limited ("SHBL"), subsidiary company have given a Qualified Opinion on the financial statements of SHBL for the year ended March 31, 2023 vide their report dated July 13, 2023, which has been considered by the statutory auditors of the Company. The basis for Qualified Opinion described by the Independent Auditors of SHBL in their report is as under:

A) Qualification with respect to Investment by SHBL in 0.01% Non-Cumulative Compulsorily Convertible Preference Shares (CCPS) issued by its associate (erstwhile wholly owned subsidiary) and opinion in respect to internal controls for management review of estimates in relation to valuation of Investments in 0.01% Non-Cumulative Compulsorily Convertible Preference Shares (CCPS) issued by its associate (erstwhile wholly owned subsidiary).

Qualification in Audit Report

We draw attention to Note 47 of the Consolidated Financial Statement with regard to fair valuation of the investment in 0.01% Non-Cumulative Compulsorily Convertible Preference Shares (CCPS) issued by its associate (erstwhile wholly owned subsidiary) by the management based on its internal assessment and best estimate of the milestone shares, milestone events and milestone consideration, as defined in the Put Call Option Agreement dated 19 November 2021 and its subsequent amendments. Pending finalisation of the terms and conditions of the milestone shares, milestone events and milestone consideration, the auditor of subsidiary company were unable to obtain sufficient appropriate audit evidence about the fair value the CCPS as at 31 March 2023. Consequently, we were unable to determine whether any adjustments to these amounts were necessary and its resultant impact on the loss for the year ended 31 March 2023.

Adverse Opinion on internal Controls

SHBL internal control system for management review of estimates in relation to valuation of investments was not operating effectively which resulted in non-compliance with Ind AS.

Management''s Response

SHBL has received 99,873 number of 0.01% Non-Cumulative Compulsorily Convertible Preference Shares (CCPS) from its associate (erstwhile wholly owned subsidiary) in the previous financial year. SHBL has entered into a Put Call Option Agreement on the 19th November 2021 with its associate and the purchaser (''the investor'') (the Holding Company of the associate) whereby it agreed to sell 75.1% of the aforesaid CCPS (''milestone shares'') to the investor at a specified consideration on achievement of certain milestones on or before the milestone event target dates by SHBL.

The put call option agreement was subsequently amended on 3rd March 2022 and 17th April 2023. As per the last amendment, SHBL agreed to transfer 12,612 CCPS to the investor for an agreed consideration, against which Rs. 1,669.23 lakhs were received in May 2023, and 4,182 CCPS to be converted into equity shares of the associate as per the conversion ratio defined in the agreement, post achievement of the specified milestones. With respect to the remaining CCPS, it was decided that SHBL, the associate, and the investor will mutually discuss and agree in writing the terms and conditions of the remaining milestone events, milestone shares and milestone consideration. The maximum overall consideration payable for all milestones has been specified by the amendment agreement dated 17 April 2023 which is in line with the amended Put Call Option Agreement dated 3rd March 2022.

The management of SHBL, based on its internal assessment and best estimate of milestone events, milestone shares and milestone consideration, has derived the fair value of the investment for the aforesaid CCPS by engaging an independent registered valuer. Further, the management estimates that all the milestone events would fall due within a period of 12 months from the Balance Sheet date and hence 75.1% of the aforesaid investment has been classified under current assets.

B) Qualification on determining the period specific effects of expenses booked as exceptional item on comparative information for the prior periods.

Qualification in Audit Report

We draw attention to Note 34.1 of the financial statement, the Company has recorded INR 161.40 lacs as an expense during the year and disclosed as exceptional item. The Company has not determined the period specific effects on comparative information for the prior periods of the impact of misappropriation of cash collections from customers aggregating to INR 161.40 lacs by few employees. As a result, we are unable to assess the likely impact of the noncompliance with the Ind AS 8 - Accounting Policies, Changes in Accounting Estimates and Errors, on the financial statements including the comparative information presented and disclosures thereof.

Adverse Opinion on internal Controls

SHBL did not have an appropriate internal control system for cash collections and debtors balance reconciliations which resulted in the omission of recording cash collected from debtors due to fraud.

Management''s Response

During the year, the Management of the subsidiary (SHBL) based on its internal assessment, has detected misappropriation of cash collections from customers aggregating to INR 161.40 lacs by few employees of SHBL during the current financial year. SHBL has referred the matter to the police department and after filing of the First Information Report (FIR), the aforesaid employees were arrested by the police and an investigation charge sheet has been filed with the Additional Chief Judicial Magistrate, Baruipur, West Bengal by the police.

SHBL has expensed the aforesaid amount during the current year under the heading "exceptional item" and SHBL is taking necessary legal action to recover the amount.

SHBL had detected the misappropriation after the approval of Financial Statement for the FY 2021-2022. Further the Determination of Specific Period were not possible from the Investigation Charge Sheet of the Police Authorities. The misappropriation is quantified on the date of the report.

SHBL is taking necessary legal action to recover the amount. However, as conservative approach it has been decided to expenses off and hence charged off to current FY 22-23 only.

The Management of the subsidiary has taken opinion from Independent Chartered Accountant, where the opinion received was in line with Management estimate to expense off in Current FY 22-23 only.

C) Qualification on Pending Reconciliation with reference to Note 16.2 under Trade Payables Qualification in Audit Report

Based on audit procedures performed in relation to trade payables, on sample vendor balances we noted instances wherein the independent balance confirmations received from vendors were not in agreement with the balances in the books of account. As stated in Note 16.2 to the financial statements, the management is in the process of reconciling the outstanding balances as at 31 March 2023. Pending reconciliations of the said balances, we are unable to comment on the adjustments, if any, with respect to the balances of trade payables arising out of such reconciliation and its consequential impact on these financial statements.

Adverse Opinion on internal Controls

SHBL did not have an appropriate internal control system for reconciliations of trade payables which could potentially result in material misstatements in the Company''s trade payables and related purchase balances

Management''s Response

Trade Payables of SHBL as of 31st March 2023 are net of debit note balance of Rs 822.87 lacs related to the return of goods (generally medicine).

This debit notes are related to return of Goods (generally medicine). The suppliers take few months to issue credit notes as per normal trade practice in pharma Industry and there is always a time lag between Purchase Debit Note Raised and Credit Note Received. The management of SHBL is in the process of collecting and matching the debit note with corresponding credit note issued by the vendor and reconciling the outstanding balance of debit notes as at 31st March 2023.

ii) The Independent Auditors of Retailer Shakti Supply Chain Private Limited ("RSSCPL"), a step down subsidiary have given a Qualified Opinion on the financial statements of RSSCPL for the year ended March 31, 2023 vide their report dated July 13, 2023, which has been considered by the statutory auditors of the company. The basis for Qualified Opinion described by the Independent Auditors of RSSCPL in their report is as under:

A) Qualification on determining the period specific effects of expenses booked as exceptional item on comparative information for the prior periods.

Qualification in Audit Report

We draw attention to Note 34.1 of the Consolidated Financial Statements, the Company has recorded INR 635.05 lacs as an expense during the year and disclosed as exceptional item. The Company has not determined the period specific effects on comparative information for the prior periods of the impact of misappropriation of cash collections from customers aggregating to INR 635.05 lacs by few employees. As a result, we are unable to assess the likely impact of the non-compliance with the Ind AS 8 - Accounting Policies, Changes in Accounting Estimates and Errors, on the Consolidated Financial Statements including the comparative information presented and disclosures thereof."

Adverse Opinion on internal Controls

The step down subsidiary, RSSCPL did not have an appropriate internal control system for cash collections and debtors balance reconciliations which resulted in the omission of recording cash collected from debtors due to fraud.

Management''s Response

During the year, the Management based on its internal assessment, has detected misappropriation of cash collections from customers aggregating to INR 635.05 lacs by few employees of the subsidiary. The Management has referred the matter to the police department and after filing of the First Information Report (FIR), the aforesaid employees were arrested by the police and an investigation charge sheet has been filed with the Additional Chief Judicial Magistrate, Baruipur, West Bengal by the police.

RSSCPL has expensed the aforesaid amount during the current year under the heading "exceptional item" and the subsidiary is taking necessary legal action to recover the amount. RSSCPL had detected the misappropriation after the approval of Financial Statement for the FY 2021-2022. Further the Determination of Specific Period were not possible from the Investigation Charge Sheet of the Police Authorities. The misappropriation is quantified on the date of the report.

The subsidiary company is taking necessary legal action to recover the amount. However, as conservative approach it has been decided to expenses off and hence charged off to current FY 22-23 only.

Management has taken opinion from Independent Chartered Accountant, where the opinion received was in line with Management estimate to expense off in Current FY 22-23 only.

|b} Secretarial Auditor

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with corresponding Rules framed thereunder, M/s MKB & Associates, a firm of Company Secretaries were appointed as the Secretarial Auditors of the Company to carry out the secretarial audit for the year ending 31st March, 2023.

Annual Secretarial Audit Report

In terms of Section 204 of the Companies Act, 2013 and Regulation 24A of the SEBI (LODR) Reg, 2015, a Secretarial Audit Report given by the Secretarial Auditors in Form No. MR-3 is annexed with this Report as "Annexure- I". There are no qualifications, reservations or adverse remarks made by Secretarial Auditors in their Report.

However, the secretarial auditor in its report have reported that pursuant to an inspection carried out under Section 206(5) of the Companies Act, 2013; proceedings have been initiated before the relevant judicial authorities for alleged violations of the provisions of Companies Act, 2013; the Company has denied the alleged violation in its reply to the Inspecting officer and is taking necessary steps to contest the same.

The secretarial auditor in its report have further reported that the management based on its Internal assessment, has detected misappropriation of cash collections from customers aggregating to Rs. 796.45 lakhs (Sastasundar Healthbuddy Limited - Rs. 161.40 Lakhs) (Retailer Shakti Supply Chain Pvt Ltd - Rs. 635.05 Lakhs) by few employees of the Sastasundar Healthbuddy Limited ("SHBL"), subsidiary of the company and Retailer Shakti Supply Chain Pvt Ltd ("RSCPL"), step down subsidiary of the company during the current financial year. SHBL has referred the matter to the police department and after filing of the First Information Report (FIR), the aforesaid employees were arrested by the police and an investigation charge

sheet has been filed with the Additional Chief Judicial Magistrate, Baruipur, West Bengal by the police. The management is taking necessary legal action to recover the amount and on conservative approach has expensed the aforesaid amount during the current year under the heading "exceptional item" in Consolidated financial statements for the Financial Year 2022-23.

As required under Regulation 24A of the SEBI (LODR) Reg, 2015, Secretarial Audit Report in Form No. MR-3 of Sastasundar Healthbuddy Limited and Retailer Shakti Supply Chain Private Limited, material unlisted subsidiaries of the Company is also annexed herewith and marked as "Annexure- II and Annexure - III" respectively.

FRAUD REPORTING:

During the year, the management based on its internal assessment, has detected misappropriation of cash collections from customers aggregating to Rs. 796.45 lakhs (Sastasundar Healthbuddy Limited - Rs. 161.40 Lakhs) (Retailer Shakti Supply Chain Pvt Ltd - Rs. 635.05 Lakhs) by few employees of the Sastasundar Healthbuddy Limited ("SHBL"), subsidiary of the company and Retailer Shakti Supply Chain Pvt Ltd ("RSCPL "), step down subsidiary of the company during the current financial year. SHBL has referred the matter to the police department and after filing of the First Information Report (FIR), the aforesaid employees were arrested by the police and an investigation charge sheet has been filed with the Additional Chief Judicial Magistrate, Baruipur, West Bengal by the police.

The management is taking necessary legal action to recover the amount and on conservative approach has expensed the aforesaid amount during the current year under the heading "exceptional item" in Consolidated financial statements for the Financial Year 2022-23.

related party transactions

During the financial year 2022-23, your Company has entered into transactions with related parties as defined under Section 2(76) of the Companies Act, 2013 read with Companies (Specification of Definitions Details) Rules, 2014, which were in the ordinary course of business and on arms'' length basis and in accordance with the provisions of the Companies Act, 2013, Rules issued thereunder and SEBI (LODR) Reg, 2015. Thus the disclosure in Form AOC-2 in terms of Section 134 of the Companies Act, 2013 is not required. However, your attention is drawn to the Related Party disclosure in Note No. 23 of the Standalone Financial Statements.

During the financial year 2022-23, there were no materially significant related party transactions entered into by the Company, which may have a potential conflict with the interest of the Company at large. There were no pecuniary relationship or transactions entered into by any Independent Director with the Company during the year under review.

At the Annual General Meeting held on 29th September, 2022 the Company has taken approval from the members for Material Related Party Transaction(s) between Sastasundar Healthbuddy Limited (SHBL), subsidiary of Sastasundar Ventures Limited and Retailer Shakti Supply Chain Private Limited (RSSCPL), step down subsidiary of Sastasundar Ventures Limited for an aggregate value of upto Rs. 300 crore for each financial year, subject to such contract(s)/ arrangement(s)/ transaction(s) being carried out at arm''s length and in the ordinary course of business of SHBL and RSSCPL.

All Related Party Transactions are placed before the Audit Committee and also before the Board for approval. Omnibus approval was obtained on a yearly basis for transactions which were of repetitive nature. Transactions entered into pursuant to omnibus approval of all the Related Party Transactions are placed before the Audit Committee and the Board for review and approval on a quarterly basis.

The Company has formulated a policy on related party transactions for purpose of identification and monitoring of such transactions. The said policy on related party transactions as approved by the Board is posted at the Company''s website at the weblink http://www.sastasundarventures.com/Pdf/SVL_RelatedPartyTransactionPolicy.pdf

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

The information relating to conservation of energy, technology absorption, foreign exchange earnings and outgo as per section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is annexed herewith as "Annexure - IV".

PARTICULARS OF EMPLOYEES & RELATED DISCLOSURES

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to this Report as "Annexure - V" and forms part of the Report.

annual return

Pursuant to the provisions of Section 134(3)(a) and Section 92(3) of the Act, as amended, read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return of the Company for the Financial Year ended 31st March, 2023 is available on the website of the Company at https://www.sastasundarventures.com/Pdf/Draft_Annual_ Return_31.03.2023.pdf

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has adopted a Whistle Blower Policy to provide a formal mechanism to the Directors and Employees to report their concern about unethical behaviour, actual or suspected fraud or violation of the Company''s Code of Conduct or ethics policy. The policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. The details of the Whistle Blower Policy is explained in the Corporate Governance Report and also posted on the website of the Company at the weblink http://www. sastasundarventures.com/Pdf/SVL_whistle_blower_policy.pdf

During the year under review, no complaints have been received/reported.

corporate social responsibility

The provisions relating to the Corporate Social Responsibility ("CSR") are not applicable to the Company.

business responsibility and sustainability report

The Securities and Exchange Board of India (SEBI) has mandated India''s top 1,000 listed entities based on market capitalization on the BSE and NSE as on March 31, 2022 to submit a ''Business Responsibility and Sustainability Report'' (BRSR) along with their Annual Report for the financial year 2022-23. This report is required to be in line with the ''National Voluntary Guidelines on Social, Environmental and Economic Responsibilities of Business'' (NVGs) as released by the Ministry of Corporate Affairs (MCA) in July, 2011 and the amendment to Listing Regulations in May 2021. As per Regulation 34(2)(f) of SEBI (LODR) Reg 2015, BRSR is a report on the nine principles of the National Voluntary Guidelines on social, environmental and economic responsibilities of business as framed by the MCA, is annexed herewith as "Annexure- VI" and forms a part of this Report.

policy on prevention of insider trading

Your Company has adopted a Code for Prevention of Insider Trading with a view to Regulate trading in equity shares of the Company by the Directors and designated employees of the Company. The said Code of Conduct is available on the website of the Company at www.sastasundarventures.com. The Code requires preclearance for dealing in Company''s shares and prohibit the purchase or sale of shares in your company by the Directors and designated employees, while they are in possession of unpublished price sensitive information and also during the period when the Trading Window remains closed.

corporate governance report and management discussion analysis report

The Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements as set out by SEBI. The Company has also implemented several best corporate governance practices. The report on Corporate Governance and Management Discussion & Analysis Report as stipulated under Schedule V of the SEBI (LODR) Reg, 2015 forms an integral part of this report.

practicing company secretaries'' certificate on corporate governance

In Compliance with the provisions of Regulation 34 of the SEBI (LODR) Reg, 2015 read with Schedule V of the said Regulations, the Corporate Governance Certificate issued by the Practicing Company Secretaries, M/s MKB & Associates, Company Secretaries regarding compliance with the conditions of Corporate Governance as stipulated is annexed to this report.

Your Company has taken adequate steps for strict compliance with the Corporate Governance guidelines, as amended from time to time.

COMPLIANCE WITH SECRETARIAL STANDARDS ON BOARD AND GENERAL MEETINGS

The Company has complied with Secretarial Standard on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2) issued by the Institute of Company Secretaries of India during the year under review.

LISTING WITH STOCK EXCHANGES

Your Company is listed with BSE Ltd. and National Stock Exchange of India Ltd. and the Company has paid the Listing Fees to both the exchanges on time.

CHIEF EXECUTIVE OFFICER (CEO) / CHIEF FINANCIAL OFFICER (CFO) CERTIFICATION

As required under Regulation 17(8) of the SEBI (LODR) Reg, 2015, the CEO/CFO certification has been submitted to the Board and a copy thereof is contained elsewhere in this Annual Report.

risk management

Your Company''s risk management strategy strives to balance the trade-off between risk and return and ensure optimal risk-adjusted return on capital, and entails independent identification, measurement and management of risks across the various businesses of your Company.

The Company has formulated a Risk Assessment & Management Policy which identify, evaluate business risks and opportunities. The risk management system of the Company is reviewed by the Audit Committee and the Board of Directors on a regular basis. During the year, no major risks were noticed, which may threaten the existence of the company.

The Company has duly constituted risk management committee, the details of the same are covered in the Corporate Governance Report forming part of the Board''s Report.

directors'' responsibility statement

The Directors acknowledges the responsibility for ensuring compliances with the provisions of section 134(3)(c) read with section 134(5) of the Companies Act, 2013 and provisions of the SEBI (LODR) Reg, 2015 and in the preparation of the annual accounts for the year ended 31st March, 2023 states that â

(a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(b) they 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 of the company at the end of the financial year and of the profit and loss of the company for that year;

(c) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) the annual accounts have been prepared on a going concern basis;

(e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

other disclosures

Your Directors state that:

1. No proceedings are pending against the Company under the Insolvency and Bankruptcy Code, 2016.

2. The Company serviced all the debts & financial commitments as and when they became due and no settlements were entered into with the bankers.

3. The company is not required to maintain cost records.

human resources

Our employees are our core resource and the Company has continuously evolved policies to strengthen its employee value proposition. Your Company was able to attract and retain best talent in the market and the same can be felt in the past growth of SastaSundar Group. The Company is constantly working on providing the best working environment to its Human Resources with a view to inculcate leadership, autonomy and towards this objective, your company spends large efforts on training. Your Company shall always place all necessary emphasis on continuous development of its Human Resources. The belief "great people create great organization" has been at the core of the Company''s approach to its people.

DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

Your Company is committed to provide a safe and secure environment to its women employees across its functions, as they are considered as integral and important part of the Organisation. Your company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013.

In terms of provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules framed thereunder, your Company has duly adopted a Policy and has also complied with the provisions relating to the constitution of Internal Complaints Committee (ICC).

There was no case of sexual harassment reported during the year under review.

ACKNOWLEDGEMENTS

Your Directors take this opportunity to thank the Regulatory and Government Authorities, Bankers, Business Associates, Shareholders and the Customers of the Company for their continued support to the Company. The Directors express their deep sense of appreciation towards all the employees and staff of the Company and wish the management all the best for achieving greater heights in the future.

Mar 31, 2018

DIRECTORS'' REPORT

Dear Members,

The Directors are pleased to present the Twenty-Ninth (29^th) Annual Report together with Audited Annual Financial Statements (including Audited Consolidated Financial Statements) of the Company for the Financial Year ended 31st March, 2018.

FINANCIAL HIGHLIGHTS

(Rs, in Lacs)

Particulars	Standalone		Consolidated
Particulars	FY 2017-18	FY 2016-17	FY 2017-18	FY 2016-17
Total Revenue	152.28	97.69	16,196.03	13,702.51
Profit/(Loss) before Interest, Depreciation & Tax	(39.20)	(82.29)	(1,281.57)	(1,822.59)
Less: Depreciation	22.74	27.49	554.42	691.83
Less: Interest	-	-	52.13	280.99
Profit/(Loss) before Tax and Exceptional Item	(61.94)	(109.78)	(1,888.12)	(2,795.41)
Exceptional Item	1,390.65	(134.00)	651.98	-
Profit /(Loss) before Tax	1,328.71	(243.78)	(1,236.14)	(2,795.41)
Less: Tax Expenses
- Current Tax	196.79	-	197.75	0.43
- Adjustment of tax relating to earlier periods	-	0.04	(0.05)	1.66
- Deferred Tax	-	-	39.07	59.78
Profit/(Loss) for the year before Minority Interest	1,131.92	(243.82)	(1,472.91)	(2,857.28)
Less: Minority Interest	-	-	(284.84)	5.25
Profit/(Loss) for the year	1,131.92	(243.82)	(1,188.07)	(2,862.53)

DIVIDEND

The Board of Directors do not recommend any dividend for the financial year 2017-18.

TRANSFER TO RESERVE

Your Board of Directors has transferred an amount of Rs, 226.38 lakhs to the Statutory Reserve maintained under Section 45-IC of the Reserve Bank of India Act, 1934.

OPERATIONAL UPDATES

Pursuant to Share Purchase Agreement (SPA) entered on 19th April, 2016 for sale of 100% shareholding in Microsec Capital Limited, wholly owned subsidiary of the Company, the entire shareholding of the Microsec Capital Limited were transferred to M/s G Raj & Co. (Consultants) Limited on 1^st December, 2017 without the Trade Mark/ word Mark of MICROSEC and/ or its allied IPRs .

The Scheme of amalgamation of PRP Technologies Limited, Myjoy Tasty Food Private Limited, the wholly owned subsidiaries and Myjoy Hospitality Private Limited, the wholly owned subsidiary of Myjoy Tasty Food Private Limited with the Company under section 233 of the Companies Act, 2013 was confirmed by the Central Government through Regional Director, Eastern Region on 9^th January, 2018 with the appointed date of 1^st April, 2016.

FINANCIAL PERFORMANCE

On a standalone basis, the revenue of your Company is Rs, 152.28 Lacs as against Rs, 97.69 Lacs during the previous year. EBIDTA for the current year is Rs, (39.20) Lacs as compared to EBIDTA of Rs, (82.29) Lacs during the previous financial year. The net profit for the year under review is Rs, 1,131.92 Lacs as against loss of Rs, 243.82 Lacs in the previous year.

On a consolidated basis, the revenue of your Company stood at Rs, 16,196.03 Lacs as against Rs, 13,702.51 Lacs during the previous year. The EBIDTA for the current year is Rs, (1,281.57) Lacs as compared to EBIDTA of Rs, (1,822.59) Lacs during the previous financial year. The net loss for the year under review is Rs, 1,188.07 Lacs as against loss of Rs, 2,862.53 Lacs in the previous year.

DEPOSITS

Your Company has neither accepted nor renewed any deposits from public within the meaning of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014 during the year.

SHARE CAPITAL

The authorized share capital of the Company was increased from Rs, 35.00 crores to Rs, 35.53 crores during the FY 2017-18 as per the order dated 9th January, 2018 of the Regional Director, Eastern Region under section 233 of Companies Act, 2013. The paid up Equity share capital of the Company as at 31st March, 2018 stood at Rs, 31.81 crores. During the year under review, the Company had not issued shares with differential voting rights nor has granted any stock option or sweat equity shares and hence, the disclosure requirements under Section 43 and Rule 4(4) of the Companies (Share Capital and Debentures) Rules, 2014 is not applicable. As on 31st March, 2018, none of the Directors of the Company holds instrument convertible into equity shares of the Company. Your Company had not made any provision of money for purchase of its own Shares by employees or by trustees for the benefit of employees during the year under review.

CHANGE IN NATURE OF BUSINESS, IF ANY

There has been no change in the nature of business of the Company during the financial year ended 31st March, 2018.

LOANS, GUARANTEES AND INVESTMENTS

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.

MATERIAL CHANGES AND COMMITMENTS

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATOR/COURTS/TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY''S OPERATIONS IN FUTURE

There were no significant and material orders passed by the Regulators or Courts or Tribunals during the year impacting the going concern status and the operations of the Company in future.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES

As on March 31, 2018 the Company has nine subsidiaries (both direct and step down). During the year under review a wholly owned subsidiary was incorporated in the name and style "Genu Path Labs Limited" to venture into Diagnostic Services as a natural extension in Healthcare. A step down wholly owned subsidiary was formed in the name and style "Microsec Wealth Management Limited" to venture into Portfolio Management Services. During the year under review 3 (three) subsidiaries viz., PRP Technologies Limited, Myjoy Tasty Food Private Limited and Myjoy Hospitality Private Limited merged with the Company and another 3 (three) subsidiaries viz., Microsec Capital Limited, Microsec Insurance Brokers Limited and Microsec Commerze Limited have ceased to be subsidiaries of the Company.

A Policy has been formulated for determining the Material Subsidiaries of the Company. Pursuant to Regulation 46 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 [hereinafter referred to as SEBI (LODR) Reg, 2015], the said Policy has been posted on the Company''s website at the weblink: http://www.sastasundarventures.com/sastasundarventures/Pdf/SVL_PolicyforDeterminationofMaterialSubsidiary.pdf

The Company does not have any Joint Venture or Associate Company as per the provisions of the Companies Act, 2013.

BOARD OF DIRECTORS:

As on 31st March, 2018, the Board of your Company consists of seven Directors as follows:

Category	Name of Directors
Executive Director	Mr. Banwari Lal Mittal, Chairman and Managing Director (DIN: 00365809)
Non-Executive Non Independent Director	Mr. Ravi Kant Sharma (DIN: 00364066) Mrs. Abha Mittal (DIN: 00519777)
Independent Non-Executive Director	Mr. Parimal Kumar Chattaraj (DIN: 00893963) Mr. Raj Narain Bhardwaj (DIN: 01571764) Mr. Deba Prasad Roy (DIN: 00049269) Mr. Rajeev Goenka (DIN: 03472302)

The composition of the Board is in line with the requirements of the Companies Act, 2013 and the SEBI (LODR) Reg, 2015. All the Directors are having vast knowledge and experience in their relevant fields and the Company had benefitted immensely by their presence in the Board.

As per the provision of the Companies Act, 2013 Mrs. Abha Mittal (DIN: 00519777) retires by rotation at the ensuing Annual General Meeting and being eligible, offers herself for re-appointment. Your Directors recommended the re-appointment of Mrs. Abha Mittal as Director. The brief profile of Mrs. Abha Mittal (DIN: 00519777), recommended for re-appointment is enclosed with the Notice of the 29th AGM of the Company.

a) Changes in Directors and Key Managerial Personnel

Pursuant to provisions of Section 149 and 152 read with Schedule IV and other applicable provisions, if any, of the Companies Act, 2013 and Companies (Appointment and Qualifications of Directors) Rules, 2014 (including any statutory modification(s) or re-enactment thereof, for the time being in force), Mr. Rajeev Goenka (DIN: 03472302) who was appointed as an Additional Director of the Company, categorized as Independent, by the Board of Directors with effect from 26th May 2017, in terms of Section 161 of the Companies Act, 2013 and the members at their meeting held on 8th August, 2017 has appointed Mr. Rajeev Goenka (DIN: 03472302) as an Independent Non-Executive Director of the Company with effect from 26th May 2017 to hold office up to 25th May 2020, not liable to retire by rotation.

The tenure of Mr. Banwari Lal Mittal (DIN: 00365809) as Managing Director & CEO expires on 30th June, 2018. The Board of Director at their meeting held on 21st May, 2018, on the recommendation of Nomination and Remuneration Committee, had re-appointed Mr. Banwari Lal Mittal as Managing Director & CEO without any remuneration for a period of 5 years w.e.f. 1st July, 2018 subject to approval of the members at the forthcoming Annual General Meeting.

Pursuant to the provisions of the Companies Act, 2013 ("Act"), Mr. Parimal Kumar Chattaraj (DIN: 00893963) was appointed as an Independent Non-Executive Director to hold office for five consecutive years for a term up to 31st March, 2019 by the Members of the Company in the 25^th Annual General Meeting held on 13^th August, 2014. Mr. Parimal Kumar Chattaraj has expressed his willingness for re-appointment as an Independent Non-Executive Director for another term of five consecutive years.

Pursuant to the provisions of the Act, based on the recommendation of the Nomination and Remuneration Committee, the Board recommends for the approval of the Members through a Special Resolution in the 29th Annual General Meeting for re-appointment of Mr. Parimal Kumar Chattaraj as an Independent Non-Executive Director for another five consecutive years from 1st April, 2019 upto 31st March, 2024.

Details of the directors being appointed/ re-appointed as required under SEBI (LODR) Reg, 2015 and Secretarial Standard -2 are provided in the Corporate Governance Report and notice of 29th Annual General Meeting.

Pursuant to Section 203 of the Companies Act, the Key Managerial Personnel of the Company are Mr. Banwari Lal Mittal, Managing Director & CEO, Mr. Amrit Daga, Chief Financial Officer and Mr. Biplab Kumar Mani, Company Secretary. During the year there has been no change in the Key Managerial Personnel.

b) Declaration by the Independent Director(s)

c) Familiarization Programme undertaken for Independent Director

In terms of Regulation 25(7) of the SEBI (LODR) Reg, 2015 your Company follows a structured orientation programme for its newly inducted Director(s) to ensure that they become fully aware of the industry in which the Company operates, the processes, systems and policies adopted and followed by the Company. The familiarization programme focuses on the business model and operations of the Company and aims at informing the directors on the legal, regulatory as well as socio-economic regime in which the Company functions.

Further, pursuant to Regulation 46 of the SEBI (LODR) Reg, 2015, your Company is required to disseminate on its website, details of familiarization programmes imparted to the Independent Director(s). During the year, the Company has organized one familiarization Programme of the Independent Directors. The details of familiarization programme imparted to the Independent Directors of the Company is available on the Company''s website at the web link http://www. sastasundarventures.com/sastasundarventures/Pdf/SVL_Familiarization_Programme_for_Independent_Director.pdf

d) Board Evaluation

The Nomination and Remuneration Committee of the Company has formulated and laid down criteria for Performance evaluation of the Board (including Committees) and every director (including independent directors) pursuant to the provisions of Section 134, Section 149 read with the code of Independent Director (Schedule IV) and Section 178 of the Companies Act, 2013 read with Rules framed thereunder and Regulation 19(4) read with Part D of Schedule II of SEBI (LODR) Reg, 2015.

The Board and the Nomination and Remuneration Committee reviewed the performance of individual directors on the basis of criteria as laid down by the Nomination and Remuneration Committee.

In a separate meeting of independent directors, performance of non-independent directors, Chairman and the board as a whole was evaluated, taking into account the views of executive directors and non-executive directors

e) Remuneration Policy

The Board has on the recommendation of the Nomination & Remuneration Committee adopted the Remuneration Policy, which inter alia includes policy for selection and appointment of Directors, Key Managerial Personnel, Senior Management Personnel and their remuneration. The remuneration policy of the Company aims to attract, retain and motivate qualified people at the Executive and at the Board levels. The remuneration policy seeks to employ people who not only fulfill the eligibility criteria but also have the attributes needed to fit into the corporate culture of the Company. The said Policy has been disclosed in the Corporate Governance Report, which forms part of this Annual Report.

MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEE Board of Directors

The Board meets at regular intervals to discuss and decide on business policy and strategy apart from other Board business. During the year under review, four Board Meetings were convened and held on 26th May, 2017, 10th August, 2017, 14th November, 2017 and 14th February, 2018, the details of which are given in the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013 as well as the SEBI (LODR) Reg, 2015.

Board Committees

The Board of Directors have constituted committees namely - Audit Committee, Nomination and Remuneration Committee, Stakeholders'' Relationship Committee, Strategic Committee and Investment Committee. The details of the Committees along with their composition, number of meetings held and attendance at the meetings are provided in the Corporate Governance Report forming a part of this Annual Report.

AUDITOR AND AUDITORS'' REPORT

M/s. Singhi & Co, Chartered Accountants (FRN: 302049E), of 161, Sarat Bose Road, Kolkata - 700026 were appointed as the Statutory Auditors of the Company during the 28th AGM held on 8th August, 2017 for a period of five years.

The Board has duly examined the Statutory Auditors'' Report to the accounts, which is self-explanatory. Clarifications, wherever necessary, have been included in the Notes to the Accounts section of the Annual Report. Further, your Directors confirm that there are no qualification, reservation or adverse remark or disclaimer in the Independent Auditor''s Report provided by Statutory Auditors for the FY 2017 - 18.

FRAUD REPORTING:

There was no fraud reported by the Auditors of the Company under section 143(12) of the Companies Act, 2013 to the Audit Committee or the Board of Directors during the year under review.

SECRETARIAL AUDIT

Pursuant to the provisions of section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the Company had appointed M/s MKB & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year 2017-18. The Report of the Secretarial Audit is annexed herewith as "Annexure - I". There are no qualifications in the Report.

TRANSACTION WITH RELATED PARTY

All transactions entered with Related Parties for the year under review were on arm''s length basis and in the ordinary course of business and that the provisions of Section 188 of the Companies Act, 2013 and the Rules made thereunder are not attracted. Thus a disclosure in Form AOC-2 in terms of Section 134 of the Companies Act, 2013 is not required. Further, there are no material related party transactions during the year under review with the Promoters, Directors or Key Managerial Personnel. All related party transactions are mentioned in the Notes to the Financial Statements.

The Company has formulated a policy on related party transactions for purpose of identification and monitoring of such transactions. The said policy on related Party transactions as approved by the Board is posted at the Company''s website at the weblink http://www.sastasundarventures.com/sastasundarventures/Pdf/SVL_RelatedPartyTransactionPolicy.pdf

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

PARTICULARS OF EMPLOYEES & RELATED DISCLOSURES

EXTRACT OF THE 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 the Companies (Management and Administration) Rules, 2014 the extract of the annual return in Form No. MGT - 9 is included in this report as "Annexure - IV" and forms an integral part of this report.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

direct access to the Chairman of the Audit Committee. The details of the Whistle Blower Policy is explained in the Corporate Governance Report and also posted on the website of the Company at the weblink http://www.sastasundarventures. com/sastasundarventures/Pdf/SVL_whistle_blower_policy.pdf

During the year, no case was reported under this policy and no personnel has been denied access to the Chairman of the Audit Committee.

CORPORATE SOCIAL RESPONSIBILITY

The provisions of Section 135 of Companies Act, 2013 relating to Corporate Social Responsibility ("CSR") are not applicable to the Company.

POLICY ON PREVENTION OF INSIDER TRADING

Your Company has adopted a Code for Prevention of Insider Trading with a view to regulate trading in equity shares of the Company by the Directors and designated employees of the Company. The said Code of Conduct is available on the website of the Company at www.sastasundarventures.com. The Code requires preclearance for dealing in Company''s shares and prohibit the purchase or sale of shares in your company by the Directors and designated employees, while they are in possession of unpublished price sensitive information and also during the period when the Trading Window remains closed.

CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION ANALYSIS REPORT

AUDITORS'' CERTIFICATE ON CORPORATE GOVERNANCE

In Compliance with the provisions of Regulation 34 of the SEBI (LODR) Reg, 2015 read with Schedule V of the said Regulations, the Corporate Governance Certificate issued by the Statutory Auditors M/s. Singhi & Co., Chartered Accountants regarding compliance with the conditions of Corporate Governance as stipulated is annexed to this report.

Your Company has taken adequate steps for strict compliance with the Corporate Governance guidelines, as amended from time to time.

CHIEF EXECUTIVE OFFICER (CEO)/ CHIEF FINANCIAL OFFICER (CFO) CERTIFICATION

As required under Regulation 17(8) of the SEBI (LODR) Reg, 2015, the CEO/CFO certification has been submitted to the Board and a copy thereof is contained elsewhere in this Annual Report.

RISK MANAGEMENT POLICY

Your Company''s risk management strategy strives to balance the trade off between risk and return and ensure optimal risk-adjusted return on capital, and entails independent identification, measurement and management of risks across the various businesses of your Company.

The details of the same are covered in the Corporate Governance Report forming part of the Board''s Report.

DIRECTORS'' RESPONSIBILITY STATEMENT

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

(d) the annual accounts have been prepared on a going concern basis;

(e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

GREEN INITIATIVES IN CORPORATE GOVERNANCE

Ministry of Corporate Affairs has permitted Companies to send copies of Annual report, Notices, etc., electronically to the email IDs of shareholders. Your Company has arranged to send the soft copies of these documents to the registered email IDs of the shareholders, wherever available. In case, any shareholder would like to receive physical copies of these documents, the same shall be forwarded upon receipt of written request in this respect.

HUMAN RESOURCES

DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

During the year under review, no complaints were received under the provisions of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

ACKNOWLEDGEMENTS

Your Directors wishes to place on record their appreciation and sincerely acknowledge the contribution and support from shareholders, customers, Central and State Governments, Bankers, Registrar of Companies, Kolkata, Securities and Exchange Board of India, BSE Limited, National Stock Exchange of India Limited, Registrar & Share Transfer Agents and other Statutory and Regulatory Authorities for the kind co-operation and assistance provided to us.

The Directors express their deep sense of appreciation towards all the employees and staff of the Company and wish the management all the best for achieving greater heights in the future.

For and on behalf of the Board

B. L. Mittal

Date : 21st May, 2018 Chairman & Managing Director

Place : Kolkata DIN: 00365809

Mar 31, 2016

Dear Members,

The Directors are pleased to present the Twenty-Seventh Annual Report together with Audited Annual Financial Statements (including Audited Consolidated Financial Statements) of the Company for the Financial Year ended 31st March, 2016.

FINANCIAL HIGHLIGHTS

(Rs. in lacs)

Particulars	Standalone		Consolidated
	FY 2015-16	FY 2014-15	FY 2015-16	FY 2014-15
Total Revenue	221.47	244.83	8899.16	5248.98
Profit/(Loss) before Interest, Depreciation & Tax	18.78	42.58	-2855.36	-994.92
Less: Depreciation	33.89	40.97	727.92	569.90
Less: Interest	-	-	100.17	93.15
Profit/(Loss) before Tax and Exceptional Item	-15.11	1.61	-3683.45	-1657.97
Exceptional Item	-237.00	-	-	172.87
Profit/(Loss) before Tax	-252.11	1.61	-3683.45	-1485.10
Less: Tax Expenses - Current Tax - Excess Provision for taxation no longer required written back - Deferred Tax	-44.82	-103.60	4.41 -39.60 7.13	33.66 -103.60 67.22
Profit/(Loss) for the year before Minority Interest	-207.29	105.21	-3655.39	-1482.38
Less: Minority Interest	-	-	5.43	7.98
Profit/(Loss) for the year	-207.29	105.21	-3660.82	-1490.36

DIVIDEND

In view of loss incurred by the Company the Board of Directors do not recommend any dividend for the financial year 2015-16.

TRANSFER TO RESERVE

The Company does not propose to transfer any amount to reserve.

OPERATIONAL UPDATE

During the year under review, in response to our letter dated 28th October, 2014 requesting for de-registration / cancellation of the Certificate of Registration as Non-Banking Financial Company (NBFC), the RBI vide its letter dated 21st July, 2015 has confirmed the same w.e.f. 21st May, 2015. At present the Company is a Core Investment Company (CIC).

Directors'' Report

The Company has entered in a Share Purchase Agreement (SPA) on 19th April, 2016 for sale of 100% shareholding in Microsec Capital Limited. Implementation of said SPA is conditional upon sanction of proposed Scheme of Arrangement between Microsec Capital Limited (MCap), the wholly owned subsidiary company and Microsec Commerze Limited (MCL), a wholly owned subsidiary of Microsec Capital Limited and PRP Technologies Limited. The proposed scheme of arrangement envisages transfer of "Consultancy and Investment" undertakings of Microsec Capital Limited and Mirosec Commerze Limited into PRP Technologies Limited.

Your Directors have also decided to change of name of the Company to represent correctly the activity / business of the Company.

On a standalone basis, the revenue of your Company was Rs. 221.47 Lacs as against Rs. 244.83 Lacs during the previous year. EBIDT was Rs. 18.78 Lacs as compared to Rs. 42.58 Lacs during the previous financial year. The net loss for the year under review was Rs. 207.29 Lacs, as against profit of Rs. 105.21 Lacs in the previous year.

DEPOSITS

SHARE CAPITAL

The paid up Equity share capital of the Company as at 31st March, 2016 is Rs. 31.81 crores. During the year under review, the Company has not issued shares with differential voting rights nor has granted any stock option or sweat equity shares. As on 31st March, 2016, none of the Directors of the Company holds instrument convertible into equity shares of the Company. Your Company has not made any provision of money for purchase of its own Shares by employees or by trustees for the benefit of employees during the year under review.

LOANS, GUARANTEES AND INVESTMENTS

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.

MATERIAL CHANGES AND COMMITMENTS

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATOR

There were no significant and material orders passed by the Regulators or Courts or Tribunals during the year impacting the going concern status and the operations of the Company in future.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Directors have laid down internal financial controls to be followed by the Company and such policies and procedures have been adopted by the Company for ensuring the orderly and efficient conduct of its business, including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

An external independent firm carries out the internal audit of the Company operations and reports its findings to the Audit Committee on a regular basis. Internal Risk & Control function also evaluates organizational risk along with controls required for mitigating those risks. Internal Audit provides assurance on functioning and quality of internal controls along with adequacy and effectiveness through periodic reporting.

SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES

The Company has fifteen subsidiaries (both direct and step down).

In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared consolidated financial statements of the Company and all its subsidiaries forms part of the Annual Report. Further a statement containing the salient features of the financial statements of each of the subsidiaries, associates in the prescribed format Form AOC-1, forms part of the Annual Report. The annual accounts of the subsidiary companies will be made available to the shareholders on request and will also be kept for inspection by the shareholders at the registered office of your Company.

A Policy has been formulated for determining the Material Subsidiaries of the Company pursuant to Regulation 46 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 [hereinafter referred to as SEBI (LODR) Reg, 2015]. The said Policy has been posted on the Company''s website at the weblink http://www.microsec.in/stadc/Pdf/ Policy_of_ Material_Subsidiary_Microsec.pdf

The Company does not have any Joint Venture or Associate Company as per the provisions of the Companies Act 2013. BOARD OF DIRECTORS:

a) Directors and Key Managerial Personnel

The tenure of Mr. Banwari Lal Mittal (DIN- 00365809) as Managing Director expired on 30th June, 2015. The Board of Director at their meeting held on 30th May, 2015, on the recommendation of Nomination and Remuneration Committee, had appointed Mr. Banwari Lal Mittal as Managing Director & CEO for a period of 3 years w.e.f. 1st July, 2015 which was approved by the members at the Annual General Meeting held on 28th September, 2015.

During the year under review Mr. Giridhar Dhelia resigned as the Chief Financial Officer of the Company at the close of business hours on 11th August, 2015. Based on the recommendation of the Nomination and Remuneration Committee and the Board, Mr. Amrit Daga has been appointed as the Chief Financial Officer and Key Managerial Personnel of the Company w.e.f 12th August, 2015. The Company has the following three Key Managerial Personnel:

1. Mr. Banwari Lal Mittal, Managing Director,

2. Mr. Amrit Daga, Chief Financial Officer and

3. Mr. Biplab Kumar Mani, Company Secretary

As per the provision of the Companies Act, 2013 Mrs. Abha Mittal (DIN: 00519777) retires by rotation at the ensuing Annual General Meeting and being eligible, offers for re-appointment. Your Directors recommended the reappointment. Details of Mrs. Abha Mittal as required under SEBI (LODR) Reg, 2015 are provided in the Corporate Governance Report and notice of 27th Annual General Meeting.

b) Declaration by an Independent Director(s)

All the Independent Directors have given a declaration that they meet criteria of independence as laid down under section 149(6) of the Companies Act, 2013 read with the rules made there under and Regulation 16(1)(b) of the SEBI (LODR) Reg, 2015.

c) Familiarization Programme undertaken for Independent Director

During the year, the Company has organized a familiarization Programme of the Independent Directors. The details of the familiarization programme of Independent Directors are provided in the Corporate Governance Report and are also available on the Company''s website at the weblink http://www.microsec.in/stattc/Pdf/Familiarisatton_program_ for_ID_Microsec.pdf

d) Board Evaluation

In compliance with the requirements of the provisions of Section 178 of the Companies Act, 2013 read with Rules framed there under and provisions of Schedule IV to the Act as well as the SEBI (LODR) Reg, 2015, your Company has carried out a performance evaluation programme for the Board of Directors, Committees of the Board and Individual Directors for the financial year ended 31st March, 2016.

e) Remuneration Policy

The remuneration policy of the Company aims to attract, retain and motivate qualified people at the Executive and at the Board levels. The remuneration policy seeks to employ people who not only fulfill the eligibility criteria but also have the attributes needed to fit into the corporate culture of the Company. The Board has on the recommendation of the Nomination & Remuneration Committee adopted the Remuneration Policy, which inter alia includes policy for selection and appointment of Directors, Key Managerial Personnel, Senior Management Personnel and their remuneration. The said Policy has been disclosed in the Corporate Governance Report, which forms part of this Annual Report.

MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEE

Board of Directors

The Board meets at regular intervals to discuss and decide on business policy and strategy apart from other Board business. However, in case of special and urgent business need, the Board''s approval is taken by passing resolutions through circulation, as permitted by law, which are confirmed in the subsequent Board meeting. During the year under review, four Board Meetings were convened and held on 30th May, 2015, 10th August, 2015, 4th November, 2015 and 9th February, 2016, the details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 as well as the SEBI (LODR) Reg, 2015.

Audit Committee

The composition and terms of reference of the Audit Committee has been furnished in the Corporate Governance Report forming a part of this Annual Report. There has been no instance where the Board has not accepted the recommendations of the Audit Committee.

Nomination and Remuneration Committee

The composition and terms of reference of the Nomination and Remuneration Committee has been furnished in the Corporate Governance Report forming a part of this Annual Report.

Stakeholders Relationship and Shareholders Grievance Committee

The composition and terms of reference of the Stakeholders Relationship and Shareholders Grievance Committee has been furnished in the Corporate Governance Report forming a part of this Annual Report.

STATUTORY AUDITORS

The Statutory Auditors of your Company M/s. S. R. Batliboi & Co. LLP, (Firm Regn. No. 301003E/ E300005) Chartered Accountants, retires at the ensuing Annual General Meeting of the Company and have given their consent for reappointment. Your Company has received a certificate from them confirming their eligibility to be re-appointed as Auditors of the Company in terms of the provisions of section 141 of the Companies Act, 2013 and rules framed there under. They have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India as required under the provisions of Regulation 33 of the SEBI (LODR) Reg, 2015. The proposal for their re-appointment has been included in the Notice convening the Twenty Seventh Annual General Meeting of the Members of the Company.

AUDITORS'' REPORT

The Auditors have submitted their Independent Auditor Report for the financial ended 31st March, 2016 and they have made no qualification, reservation or adverse remarks or disclaimer in their report.

SECRETARIAL AUDIT

Pursuant to the provisions of section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the Company had appointed M/s MKB & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year 2015-16. The Report of the Secretarial Audit is annexed herewith as "Annexure - I".

RELATED PARTY TRANSACTIONS

The Company has formulated a policy on related party transactions for purpose of identification and monitoring of such transactions. The said policy on related Party transactions as approved by the Board is posted at the Company''s website at the weblink http://www.microsec.in/stadc/Pdf/Policy_of_Material_Subsidiary_Microsec.pdf

All the related party transactions that were entered into during the financial year were on an arm''s length basis, in the ordinary course of business and in compliance with the applicable provisions of the Companies Act, 2013 and the SEBI (LODR) Reg, 2015 except the contract or arrangements entered into by the Company with the related party in terms of sub-section (1) of section 188 of the Companies Act, 2013 as disclosed in Form No. AOC -2 is annexed herewith as "Annexure - II".

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

EXTRACT OF THE ANNUAL RETURN

PARTICULARS OF EMPLOYEES & RELATED DISCLOSURES

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has adopted a Whistle Blower Policy to provide a formal mechanism to the Directors and Employees to report their concern about unethical behaviour, actual or suspected fraud or violation of the Company''s Code of Conduct or ethics policy. The policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. The details of the Whistle Blower Policy is explained in the Corporate Governance Report and also posted on the website of the Company at the webilink http:// www.microsec.in/stattc/Pdf/Whistle_Blower_Policy_Microsec.pdf. During the year under review, no complaints has been received/reported.

CORPORATE SOCIAL RESPONSIBILITY

Your Company suffered losses during the year 2015-16. The Financial performance of the Company has declined since 2013-14. The immediate future in terms of performance appears to be bleak. In such circumstance the Company has not voluntarily undertaken any CSR activity during the year under review.

POLICY ON PREVENTION OF INSIDER TRADING

Your Company has adopted a Code for Prevention of Insider Trading with a view to Regulate trading in equity shares of the Company by the Directors and designated employees of the Company. The said Code of Conduct is available on the website of the Company at www.microsec.in. The Code requires preclearance for dealing in Company''s shares and prohibit the purchase or sale of shares in your company by the Directors and designated employees, while they are in possession of unpublished price sensitive information and also during the period when the Trading Window remains closed.

CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION ANALYSIS REPORT

CORPORATE GOVERNANCE CERTIFICATE

In Compliance with the provisions of Regulation 34 of the SEBI (LODR) Reg, 2015 read with Schedule V of the said Regulations, the Corporate Governance Certificate issued by the Statutory Auditors M/s S. R. Batliboi & Co. LLP, Chartered Accountants regarding compliance with the conditions of Corporate Governance as stipulated is annexed to this report. Your Company has taken adequate steps for strict compliance with the Corporate Governance guidelines, as amended from time to time.

CHIEF EXECUTIVE OFFICER (CEO) / CHIEF FINANCIAL OFFICER (CFO) CERTIFICATION

As required under Regulation 17(8) of the SEBI (LODR) Reg, 2015, the CEO/CFO certification has been submitted to the Board and a copy thereof is contained elsewhere in this Annual Report.

RISK MANAGEMENT POLICY

The Company has formulated a Risk Assessment & Management Policy which identify, evaluate business risks and opportunities. The details of the same are covered in the Corporate Governance Report forming part of the Board''s Report.

DIRECTORS'' RESPONSIBILITY STATEMENT

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

(d) the annual accounts have been prepared on a going concern basis;

(e) they have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

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

GREEN INITIATIVES IN CORPORATE GOVERNANCE

HUMAN RESOURCES

Our employees are our core resource and the Company has continuously evolved policies to strengthen its employee value proposition. Your Company was able to attract and retain best talent in the market and the same can be felt in the past growth of Microsec Group. The Company is constantly working on providing the best working environment to its Human Resources with a view to inculcate leadership, autonomy and towards this objective, your company spends large efforts on training. Your Company shall always place all necessary emphasis on continuous development of its Human Resources. The belief "great people create great organization" has been at the core of the Company''s approach to its people.

DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

Your Company is committed to provide a safe and secure environment to its women employees across its functions, as they are considered as integral and important part of the Organization.

Your company has in place an Anti Sexual Harrassment Policy in line with the requirements of the Sexual Harrassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013.

There was no case of sexual harrasment reported during the year under review.

ACKNOWLEDGEMENTS

For and on behalf of the Board

Sd/-

B. L. Mittal

Date : 5th August, 2016

Chairman & Managing Director

Place : Kolkata DIN: 00365809

Mar 31, 2014

To the Members,

The Directors have pleasure in presenting the 25th Annual Report together with the Audited Accounts of the Company for the financial year ended 31st March, 2014.

FINANCIAL HIGHLIGHTS

A summary of Consolidated Financial Results of the Company and its subsidiaries for the year ended 31st March, 2014 is given below :

(Rs. in Lacs)

Particulars Year ended Year ended 31.03.2014 31.03.2013

Total Revenue 3,060.62 4,762.45

Profit/Loss) before Interest, Depreciation & Tax (417.12) 1,549.17

Less : Depreciation 187.66 170.25

Less : Interest 65.15 113.68

Profit/(Loss) before Taxation (669.93) 1,265.24

Less : Tax Expenses

- Current Tax 8.93 324.36

- Excess Provision for taxation no longer required written back (104.47) 0.72

- Deferred Tax 59.66 62.10

Profit/(Loss) for the year before Minority Interest (634.05) 878.06

Less: Minority Interest 13.40 1.40

Less: Proportionate share of Loss in associate 0.00 57.06

Profit/(Loss) for the Year (647.45) 819.60

Balance brought forward from previous year 8,833.17 8,209.85

Balance Available for appropriation 8,185.72 9,029.45

Less : Appropriations

Transfer to Reserve under section 45-IC of the RBI Act, 1934 14.92 196.06

Transfer to Debenture Redemption Reserve 12.50 0.22

Proposed Dividend

Dividend Tax thereon - -

Surplus in the Statement of Profit & Loss 8,158.30 8,833.17

A summary of the Standalone Financial Results for the year ended 31st March, 2014 is given below:

(Rs. in Lacs)

Particulars Year ended Year ended 31.03.2014 31.03.2013

Total Revenue 275.82 1,789.86

Profit before Interest, Depreciation & Tax 60.24 1,335.59

Less: Depreciation 35.65 38.71

Less: Interest 0.14 5.19

Profit before Taxation 24.45 1,291.69

Less: Tax Expenses

- Current Tax 2.65 297.51

- Excess provision for taxation no longer required written back (67.97) -

- Deferred Tax 30.83 17.95

Profit for the year 58.94 976.23

Balance brought forward from previous year 3,877.02 3,096.79

Balance Available for appropriation 3,935.96 4,073.02

Less: Appropriations

Transfer to Reserve under section 45-IC of the RBI Act, 1934 11.79 196.00

Proposed dividend - -

Dividend Tax thereon - -

Surplus in the Statement of Profit & Loss 3,924.17 3,877.02

REVIEW OF OPERATIONS

During the year, the Indian economy remained upset owing to global distress and persistent domestic turbulence. The major obstructions were inflation, high fiscal deficit, lack of liquidity, policy uncertainty and currency volatility. India''s Gross Domestic Product (GDP) growth rate moderated in the year 2013, owing to the underperformance by almost all sectors of the economy. The Rupee plunged to its lowest level against the US dollar.

During the year, the company has launched sastasundar.com - an innovative digital pharmacy and healthcare store.

Foreseegame.com has also seen tremendous growth in terms of registered users and brands. Both these businesses are in infant stage and therefore will take some time to exhibit positive cash flows.

During the year under review, on consolidated basis, your company posted a total income of Rs. 3060.62 Lacs and net loss after tax of Rs. 647.45 Lacs.

DIVIDEND

With a view to strengthening the financial position of the Company, your Directors have not recommended any dividend for the financial year 2013-14.

SUBSIDIARY AND CONSOLIDATED RESULTS OF OPERATIONS

As at 31st March, 2014 the Company''s subsidiaries and step-down subsidiaries are as follows :

Sr. No. Name

1. Microsec Capital Limited

2. Microsec Resources Private Limited

3. Microsec Technologies Limited

4. Microsec Commerze Limited

5. Microsec Insurance Brokers Limited

6. PRP Technologies Limited

7. Microsec Health Buddy Limited

8 Bharatiya Sanskriti Village Private Limited

9 Myjoy Tasty Food Private Limited

10 Myjoy Hospitality Private Limited

11 Myjoy Technologies Private Limited

12 Myjoy Pharmaceuticals Private Limited

13 Sasta Sundar Shop Private Limited

14 Joybuddy Fun Products Private Limited

The Statement pursuant to Section 212 of the Companies Act, 1956, containing details of the Company''s subsidiaries forms part of the Annual Report.

The Ministry of Corporate Affairs, Government of India, has granted a general exemption to companies, by general circular no. 2/2011 dated 8th February, 2011 under section 212(8) of the Companies Act, 1956 from attaching individual accounts of subsidiaries with their annual accounts, subject to fulfillment of certain conditions. Accordingly the Board of Directors of the Company has by resolution given consent for not attaching the Balance Sheet, Statement of Profit and Loss and other documents of the subsidiary companies in the Annual Report of the Company for the financial year ended 31st March, 2014.

In terms of the Circular No. 2/2011 dated February 8, 2011 issued by the Ministry of Corporate Affairs, Government of India, the balance sheet, statement of profit and loss and other documents of the aforesaid subsidiaries are not attached to the Balance Sheet as on 31st March, 2014 of your Company.

The Annual Reports-2014 of the aforesaid subsidiaries will be made available to the shareholders of the Company upon receipt of written requests from them. The Annual Reports-2014 of the aforesaid subsidiary companies will also be kept for inspection by the shareholders of the Company at the Registered Office of your Company and of the subsidiaries concerned between 10.30 a.m. and 1.30 p.m. on any working day.

In compliance with the requirements of the aforesaid Circular, a Statement showing relevant details for the year ended 31st March, 2014 of the subsidiaries of the Company have been included in the Consolidated Financial Statements of the Company which forms part of this Annual Report.

DIRECTORS

In accordance with the provisions of the Companies Act, 2013 and as per the Articles of Association of the Company Mr. Ravi Kant Sharma, Director, will retire by rotation at the ensuing Annual General Meeting and being eligible, offers himself for reappointment.

As per provisions of Sections 149, 150, 152 and any other applicable provisions of the Companies Act, 2013 and the rules made thereunder read with Schedule IV to the Companies Act, 2013, Mr. Parimal Kumar Chattaraj (DIN: 00893963), Mr. Deba Prasad Roy (DIN: 00049269) and Mr. Raj Narain Bhardwaj (DIN: 01571764), all existing Independent directors of the Company, have been appointed as Independent Directors of the Company and shall hold office from the date of this Annual General Meeting till 31st March, 2019. They shall not, henceforth, be liable to determination by retirement of directors by rotation.

Brief resume of the Directors seeking appointment, reappointment as stipulated under Clause 49 of the Listing Agreement, are provided in the Report on Corporate Governance forming part of the Annual Report.

Based on the confirmations received, none of the Directors of the Company are disqualified for appointment under Section 274(1)(g) of the Companies Act, 1956.

COMMITTEES OF DIRECTORS

The Board of Directors have aligned the existing Committees of the Board with the provisions of Companies Act, 2013 (Act). Accordingly, the Company has renamed its existing Remuneration & Compensation Committee as "Nomination and Remuneration Committee" and have delegated to it powers as required under section 178 of the Act. The existing Shareholder''s / Investor''s Grievance and Share Transfer Committee has been renamed as "Stakeholders Relationship and Shareholders Grievance Committee".

The scope of Audit Committee has also been widened so as to bring it in accordance with the requirement of the Section 177 of the Companies Act, 2013.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to section 217(2AA) of the Companies Act, 1956, your Directors confirm that:

(i) in the preparation of the annual accounts, the applicable accounting standards have been followed;

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

(iii) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

(iv) the annual accounts have been prepared on a going concern basis.

CORPORATE GOVERNANCE

The Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement forms part of the Annual Report.

Certificate from the Statutory Auditors M/s S. R. Batliboi & Co. LLP, Chartered Accountants regarding compliance with the conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with Stock Exchanges is annexed to the report.

Your Company has taken adequate steps for strict compliance with the Corporate Governance guidelines, as amended from time to time.

The Company has established a vigil mechanism as required under Section 177 of the Companies Act, 2013 and has framed the "Whistle Blower Policy" for implementation thereof.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report for the year under review, as stipulated under clause 49 of the Listing Agreement with Stock Exchanges in India, is presented in a separate section forming part of the Annual Report.

CEO AND CFO CERTIFICATION

In accordance with the provisions of the Listing Agreement pertaining to corporate governance norms, Mr. Ravi Kant Sharma, MD & CEO and Mr. Giridhar Dhelia, CFO have certified inter-alia, about review of financial statements and establishing & maintaining internal control to the financial reporting for the year ended 31st March, 2014. The said certificate forms an integral part of annual report.

AUDITORS

The Statutory Auditors of the Company, S. R. Batliboi & Co. LLP, Chartered Accountants will retire at the ensuing AGM. As recommended by the Audit Committee, the Board has proposed the re-appointment of S. R. Batliboi & Co. LLP, Chartered Accountants as statutory auditors for financial year 2014-15 on such remuneration as decided by the Board of Directors.

The Company has received a certificate from the proposed Auditors to the effect that their appointment, if made, would be in accordance with all the conditions prescribed under the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014.

With regard to the matter of emphasis in the Auditor''s Report the Note 33 of the standalone accounts and Note 40 of the consolidated accounts of the Company are self-explanatory and therefore does not call for any further comments.

FIXED DEPOSITS

During the year, your Company did not accept/renew any deposits within the meaning of Section 58A of the Companies Act, 1956 and the rules there under and as such, no amount of principal or interest is outstanding as on the date of balance sheet.

STOCK EXCHANGE

The equity shares of your Company continue to be listed and traded on the BSE Limited and National Stock Exchange of India Limited.

The Annual Listing Fees for the year 2014-15 are paid to both the stock exchanges where the shares of the Company are listed.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo as per Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is appended as Annexure - "A" and forms part of this Report.

PARTICULARS OF EMPLOYEES

The Company has not employed any individual whose remuneration falls within the purview of the limits prescribed under the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975.

HUMAN RESOURCE MANAGEMENT

Our employees are our core resource and the Company has continuously evolved policies to strengthen its employee value proposition. Your Company was able to attract and retain best talent in the market and the same can be felt in the past growth of Microsec Group. The Company is constantly working on providing the best working environment to its Human Resources with a view to inculcate leadership, autonomy and towards this objective; your company spends large efforts on training. Your Company shall always place all necessary emphasis on continuous development of its Human Resources. The belief "great people create great organization" has been at the core of the Company''s approach to its people.

ACKNOWLEDGMENT

Your Directors take this opportunity to thank the Regulatory and Government Authorities, Bankers, Business Associates, Shareholders and the Customers of the Company for their continued support to the Company. The Directors express their deep sense of appreciation towards all the employees and staff of the Company and wish the management all the best for achieving greater heights in the future.

For and on behalf of the Board

Place: Kolkata B.L. Mittal

Date : 19th May, 2014 Chairman & Managing Director

Mar 31, 2013

To the Members,

The Directors have pleasure in presenting the 24th Annual Report together with the Audited Accounts of the Company for the financial year ended 31st March, 2013.

FINANCIAL HIGHLIGHTS

A summary of Consolidated Financial Results of the Company and its subsidiaries for the year ended 31st March, 2013 is given below:

(Rs. in Lacs) Year ended Year ended particu|ars 31.03.2013 31.03.2012

Total Revenue 4,762.45 5,797.26

Profit before Interest, Depreciation & Tax 1,549.18 2,886.50

Less: Depreciation 170.25 603.25

Less interest 113.68 51.97

Profit before Taxation 1,265.25 2,231.28

Less: Provision for Taxation

- Current Tax 325.09 774.68

-Deferred Tax 62.10 (49.28)

- Excess Provision of Income Tax for earlier years, written back - (18.51)

Profit for the year before Minority Interest 878.06 1,524.39

Less: Minority interest 1.40

Less : Proportionate share of Loss in associate 5.06 120.63

Profit for the Year 819.60 1,403.76

Balance brought forward from previous year 8,209.85 7,420.30

Balance Available for appropriation 9,029.45 8,824.06

Less appropriations

Transfer to Reserve under section 45-IC of the RBI Act, 1934 196.06 232.00

Transfer to Debenture Redemption Reserve 0.22 12.50

Proposed Dividend 318.11

Dividend Tax thereon 51.60

Balance of Profit carried forward 8,833.17 8,209.85

A summary of the Standalone Financial Results for the year ended 31st March, 2013 is given below :

(Rs. in Lacs)

Year ended Year ended particu|ars 31.03.2013 31.03.2012

Total Revenue 1,789.86 2,289.45

Profit before Interest, Depreciation & Tax 1,335.60 2,023.57

Less: Depreciation 38.72 441.36

Less interest 5.19 0.32

Profit before Taxation 1,291.69 1,581.89

Less: Provision for Taxation

-CurrentTax 297.51 612.07

-Deferred Tax 17.95 (109.48)

- Excess Tax Provision relating to earlier years no (11.94)

longer required written back

Profit for the year 976.23 1,091.24

Balance brought forward from previous year 3,096.79 2,594.26

Balance Available for appropriation 4,073.02 3,685.50

Less: Appropriations

Transfer to Reserve under section 45-IC of the RBI Act, 1934 196.00 219.00

Proposed dividend 318.11

Dividend Tax thereon 51.60 Balance of Profit carried forward 3,877.02 3,096.79

REVIEW OF OPERATIONS

The slowdown in Indian economy has adversely impacted performance of many companies including yours. The recessionary signs were clearly visible across many sectors at the beginning of the year and accordingly your directors strategically tighten the grip on capital and liquidity and implemented various measures to ensure the same. These measures have also impacted the performance of the Company during the year. On consolidated basis, the total income of the Company for the financial year ended March 31, 2013 decreased by 17.85% to Rs. 4762.45 Lacs and the profit after tax was Rs. 819.60 Lacs, decrease of 41.61% over previous year.

DIVIDEND

Keeping in view the growth plans of the Company, your directors think it prudent to preserve the cash for growth plans and do not recommend any dividend for the financial year 2012-13.

SUBSIDIARY AND CONSOLIDATED RESULTS OF OPERATIONS

As at March 31, 2013 the Company''s subsidiaries and step-down subsidiaries are as follows :

SI. No. Name SI. No. Name

1. Microsec Capital Limited 8 Bharatiya Sanskrit Village Private Limited

2. Microsec Resources Private Limited 9. Myjoy Tasty Food Private Limited

3. Microsec Technologies Limited 10. Myjoy Hospitality Private Limited

4. Microsec Commerze Limited 11. Myjoy Technologies Private Limited

5. Microsec Insurance Brokers Limited 12 Myjoy Pharmaceuticals Private Limited

6. PRP Technologies Limited 13. Sasta Sundar Shop Private Limited

7. Microsec Health Buddy Limited

The Statement pursuant to Section 212 of the Companies Act, 1956, containing details of the Company''s subsidiaries forms part of the Annual Report.

In terms of the Circular No. 2/2011 dated February 8, 2011 issued by the Ministry of Corporate Affairs, Government of India, the balance sheet, statement of profit and loss and other documents of the aforesaid subsidiaries are not attached to the Balance Sheet as on March 31, 2013 of your Company. The Annual Report 2012-13 of the aforesaid subsidiaries will be made available to the shareholders of the Company upon receipt of written requests from them. The Annual Report 2012-13 of the aforesaid subsidiary companies will also be kept for inspection by the shareholders of the Company at the Registered Office of your Company and of the subsidiaries concerned between 10.30 a.m. and 1.30 p.m. on any working day.

In compliance with the requirements of the aforesaid Circular, a Statement showing relevant details for the year ended March 31, 2013 of the subsidiaries of the Company have been included in the Consolidated Financial Statements of the Company which forms part of this Annual Report.

RESTRUCTURING OF MICROSEC GROUP

Your Company has successfully implemented the restructuring proposal as approved by the shareholders. Your company has acquired 100% stake of Microsec Health Buddy Limited (formerly Myjoy Fun & Food Pvt. Ltd.) ("MHBL") and also integrated the business of foreseegame.com with Microsec Technologies Limited, a 100% ultimate subsidiary of the Company.

Please refer to Management Discussion and Analysis for details.

AWARDS AND RECOGNITION

Your Company has been awarded the "Plaque" by The Institute of Chartered Accountants of India at ''ICAI Awards for Excellence in Financial Reporting'' for the year 2011-12 under the Category Financial Services Sector (Other than Banking and Insurance).

DIRECTORS

In accordance with the provisions of Section 255 and 256 of the Companies Act, 1956, Mr. Raj Narain Bhardwaj, retires by rotation at the ensuing Annual General Meeting of the Company and being eligible offer himself for reappointment.

Brief resume of the Director seeking appointment, reappointment as stipulated under Clause 49 of the Listing Agreement, are provided in the Report on Corporate Governance forming part of the Annual Report.

Based on the confirmations received, none of the Director are disqualified for appointment under Section 274(l)(g) of the Companies Act, 1956.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to section 217(2AA) of the Companies Act, 1956, your Directors confirm that:

(i) in the preparation of the annual accounts, the applicable accounting standards have been followed;

(ii) they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2013 and of the profit of the Company for the year ended on that date;

(iii) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

(iv) the annual accounts have been prepared on a going concern basis.

AUDIT COMMITTEE

The Audit Committee presently comprises of: Mr. Parimal Kumar Chattaraj - Chairman Mr. Raj Narain Bhardwaj, Mr. Deba Prasad Roy and Mr. Ravi Kant Sharma

SHAREHOLDERS/INVESTORS'' GRIEVANCE AND SHARE TRANSFER COMMITTEE

The Shareholders/Investors'' Grievance and Share Transfer Committee of the Board of Directors presently comprises of:

Mr. Raj Narain Bhardwaj-Chairman

Mr. Parimal Kumar Chattaraj and

Mr. Banwari Lai Mittal

REMUNERATION AND COMPENSATION COMMITTEE

The Remuneration and Compensation Committee of the Board of Directors presently comprises of: Mr. Parimal Kumar Chattaraj-Chairman Mr. Raj Narain Bhardwaj and Mr. Deba Prasad Roy.

CORPORATE GOVERNANCE

The Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement forms part of the Annual Report.

Certificate from the Statutory Auditors M/s S. R. Batliboi & Co. LLP, Chartered Accountants regarding compliance with the conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with Stock Exchanges is annexed to the report.

Your Company has taken adequate steps for strict compliance with the Corporate Governance guidelines, as amended from time to time.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report for the year under review, as stipulated under clause 49 of the Listing Agreement with Stock Exchanges in India, is presented in a separate section forming part of the Annual Report.

CEO AND CFO CERTIFICATION

In accordance with the provisions of the Listing Agreement pertaining to corporate governance norms, Mr. Ravi Kant Sharma, MD & CEO and Mr. Giridhar Dhelia, CFO have certified inter-alia, about review of financial statements and establishing & maintaining internal control to the financial reporting for the year ended 31st March, 2013. The said certificate forms an integral part of annual report.

AUDITORS

The Members are informed that the name of the statutory auditors S. R. Batliboi & Co., Chartered Accountants (Regn. No. 301003E) has been changed to S. R. Batliboi & Co. LLP, Chartered Accountants (Regn. No. 301003E) with effect from April 1, 2013 consequent to their conversion into a Limited Liability Partnership.

The auditors, S. R. Batliboi & Co. LLP, Chartered Accountants will retire at the ensuing AGM. As recommended by the Audit Committee, the Board has proposed the re-appointment of S. R. Batliboi & Co. LLP, Chartered Accountants as statutory auditors for fiscal 2014.

The Company has received letter from the auditor to the effect that their re-appointment, if made, would be within the prescribed

limits under Section 224(1B) of the Companies Act, 1956 and that they are not disqualified for re-appointment within the meaning of Section 226 of the said Act.

AUDITORS''REPORT

In relation to the matter dealt with by the Auditors under para "Basis for qualified opinion" in their Report dated May 24, 2013 we would like to submit that as required by RBI guidelines for Core Investment Company every CIC-ND-SI should have 90% investment within the group, and in terms of current prudential norms for NBFCs-ND-SI, they are permitted only 40% of both lending and investment within any group therefore accordingly, no NBFC as it stands, would be able to become a CIC without breaching the NOF, CRAR or Concentration Norms. The Company also holds more than 90% of its Net Assets in the form of investment in group Companies in order to become a Core Investment Company and accordingly in this matter the Company has already applied to the Reserve Bank of India (RBI) seeking exemption from complying with the capital adequacy/exposure norms as required.

DEPOSITS AND LOANS/ADVANCES

During 2012-13, your Company did not accept/renew any deposits within the meaning of Section 58A of the Companies Act, 1956 and the rules thereunder and as such, no amount of principal or interest was outstanding as on the balance sheet date.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo as per Section 217(l)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is appended as Annexure - "A" and forms part of this Report.

PARTICULARS OF EMPLOYEES AS REQUIRED UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956 AND RULES FRAMED THEREUNDER

The Company has not employed any individual whose remuneration falls within the purview of the limits prescribed under the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975.

HUMAN RESOURCE MANAGEMENT

Our employees are our core resource and the Company has continuously evolved policies to strengthen its employee value proposition. Your Company was able to attract and retain best talent in the market and the same can be felt in the past growth of Microsec Group. The Company is constantly working on providing the best working environment to its Human Resources with a view to inculcate leadership, autonomy and towards this objective, your Company spends large efforts on training. Your Company shall always place all necessary emphasis on continuous development of its Human Resources. The belief "great people create great organization" has been at the core of the Company''s approach to its people.

ACKNOWLEDGEMENT

Your Directors take this opportunity to thank the Regulatory and Government Authorities, Bankers, Business Associates, Shareholders and the Customers of the Company for their continued support to the Company. The Directors express their deep sense of appreciation towards all the employees and staff of the Company and wish the management all the best for achieving greater heights in the future.

For and on behalf of the Board

Place :Kolkata B. L Mlttal

Date : 24th May, 2013 Chairman & Managing Director

Mar 31, 2012

The Directors have pleasure in presenting the 23rd Annual Report together with the Audited Accounts of the Company for the financial year ended 31st March, 2012.

FINANCIAL HIGHLIGHTS

A summary of Consolidated Financial results of the Company and its subsidiaries for the year ended 31st March, 2012 is given below: -

(Rs. in Lacs)

Particulars Year ended Year ended

31.03.2012 31.03.2011

Income 5782.63 7849.07

Profit before Interest, Depreciation & Tax 2886.50 4627.18

Less: Depreciation 603.25 255.86 Less: Interest 51.97 76.26

Profit before Taxation 2231.28 4295.06

Less : Provision for Taxation

-Current Tax 774.68 991.67

- Deferred Tax (49.28) 25.39

- Excess Provision of Income Tax for earlier years, written back (18.51) - Profit for the year 1524.39 3278.00 Balance brought for ward from previous year 7420.30 4902.51 Balance Available for Appropriation 8944.69 8180.51 Less: Appropriations

-Proportionate share of Loss of Associate Company 120.63 -

-Transfer to Reserve under Section 45-IC of the RBI Act, 1934 232.00 376.00

-Transfer to Debenture Redemption Reserve 12.50 12.50

-Transfer to Capital Redemption Reserve - 2.00

- Proposed Dividend 318.11 318.11

-Dividend Tax thereon 51.60 51.60

Balance of Profit carried forward 8209.85 7420.30

A summary of Standalone Financial results for the year ended 31st March, 2012 is given below :

(Rs. in Lacs)

Particulars Year ended Year ended 31.03.2012 31.03.2011

Income 2289.45 2724.31

Profit before Interest, Depreciation & Tax 2023.25 2458.78

Less: Depreciation 441.36 95.10

Less: Interest - 12.12

Profit before Taxation 1581.89 2351.56

Less : Provision for Taxation

-Current Tax 612.07 553.15

-Deferred Tax (109.48) (0.07)

- Excess Tax Provision relating to earlier years no longer required written back (11.94) -

Profit for the year 1091.24 1798.48

Balance brought for ward from previous year 2594.26 1525.49

Balance Available for Appropriation 3685.50 3323.97 Less: Appropriations

Transfer to Reserve under section 45-IC of the RBI Act, 1934 219.00 360.00

Proposed dividend 318.11 318.11

Dividend Tax there on 51.60 51.60

Balance of Profit carried forward 3096.79 2594.26

REVIEW OF OPERATIONS

The Company's performance during the year was affected due to adverse capital market scenario which prevailed during most part of the year. On consolidated basis, the total income of the Company for the financial year ended March 31, 2012 decreased by 26.33% to Rs. 5782.63 Lacs and the profit after tax was Rs. 1524.39, down by 53.50% over previous year.

The detailed results of operations of the Company are given in the Management Discussion & Analysis forming part of this Report.

DIVIDEND

Keeping in view the overall performance during the year, your Directors are pleased to recommend a dividend of Re 1 per Equity Share on the face value of Rs. 10 each being 10%, which if approved at the ensuing Annual General Meeting, payable to those members whose names appear in the Register of Members as on the Book Closure Date. The Dividend will absorb a sum of Rs. 369.71 lacs including dividend distribution tax.

KEY INITIATIVES

Microsec Mutual Fund :

Your Company operates as an integrated financial service provider and covers retail, High Net worth Individuals (HNIs), Corporate & Institutions. The Asset Management business is an integral part of the business and the Company for see good growth opportunity in the business. Portfolio Management Services (PMS) and Mutual Fund Advisory related services are already being provided to the clients. The Directors think that starting Mutual Fund Company will strengthen the business model. As you are aware that the Company has taken the approval from the Board of Directors in its meeting held on 9th February, 2012 to enter into Mutual Fund business, we are pleased to share with you that the Company has filed an application to SEBI for registration as Mutual Fund.

SUBSIDIARY COMPANIES AND CONSOLIDATED RESULTS OF OPERATIONS

As at March 31, 2012, the Company's subsidiaries and step-down subsidiaries are as follows :

Sl. No. Name

1 Microsec Capital Limited

2 Microsec Resources Private Limited

3 Microsec Technologies Limited

4 Microsec Commerze Limited

5 Microsec Insurance Brokers Limited

6 PRP Technologies Limited

During the year under review, Microsec Capital Limited (MCap), the 'Material Non-listed Subsidiary' of the Company earned the revenues of Rs. 2130.12 Lacs and has incurred a loss of Rs. 25.20 Lacs.

In terms of the Circular No. 2/2011 dated February 8, 2011 issued by the Ministry of Corporate Affairs, Government of India, a general exemption has been granted from the compliance of Section 212 of the Companies Act, 1956, requiring holding companies to attach with their balance sheet, a copy of the balance sheet, profit and loss account and other documents of each of its subsidiaries, provided that the Board of Directors of such companies have given consent, by way of a resolution, for not attaching the Accounts & Reports of the subsidiary companies concerned with the balance sheet of the Company and that the conditions prescribed in the said Circular are complied with. Your Board at their meeting held on May 23, 2012 have given their consent for not attaching, inter alia, the balance sheet, statement of profit and loss and other relevant reports and statements of its subsidiary companies to the balance sheet of your Company as on March 31, 2012 and have also agreed to comply with the conditions prescribed in the said Circular.

In view of the above Circular, the balance sheet, statement of profit and loss and other documents and statements of the aforesaid subsidiaries have not been attached to the Balance Sheet as on March 31, 2012 of your Company. The Annual Reports-2012 of the aforesaid subsidiaries will be made available to the shareholders of the Company and its subsidiaries upon receipt of written requests from them. The Annual Reports-2012 of the aforesaid subsidiary companies will also be kept for inspection by the shareholders of the Company at the Registered Office of the Company between 10.30 a.m. and 1.30 p.m. on any working day.

In compliance with the requirements of the aforesaid Circular and Accounting Standard AS- 21 read with AS-23, a Statement showing relevant details for the year ended March 31, 2012 of the wholly owned subsidiaries of the Company have been included in the Consolidated Financial Statements of the Company which forms part of this Annual Report.

DIRECTORS

Prof. (Dr.) Gourav Vallabh, resigned as an Independent Director from the Board of the Company on September 21, 2011.

In accordance with the provisions of Section 255 and 256 of the Companies Act, 1956 and the Articles of Association of the Company Mr. Parimal Kumar Chattaraj, retire by rotation at the ensuing Annual General Meeting of the Company and being eligible offer himself for reappointment.

Brief resume of the Director seeking appointment, reappointment, nature of his expertise in specific functional areas and names of companies in which he hold directorships and memberships/chairmanships of Board Committees, as stipulated under Clause 49 of the Listing Agreement, are provided in the Report on Corporate Governance forming part of the Annual Report.

Based on the confirmations received, none of the Directors are disqualified for appointment under Section 274(1)(g) of the Companies Act, 1956.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors confirm that:

(i) in the preparation of the annual accounts, the applicable accounting standards have been followed;

(ii) they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2012 and of the Profit of the Company for the year ended on that date;

(iii) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

(iv) the annual accounts have been prepared on a going concern basis.

AUDIT COMMITTEE

The Audit Committee presently comprises of:

Mr. Parimal Kumar Chattaraj - Chairman

Mr. Raj Narain Bhardwaj,

Mr. Deba Prasad Roy and

Mr. Ravi Kant Sharma

SHAREHOLDERS/INVESTORS' GRIEVANCE AND SHARE TRANSFER COMMITTEE

The Shareholders/Investors' Grievance and Share Transfer Committee of the Board of Directors presently comprises of:

Mr. Raj Narain Bhardwaj _ Chairman

Mr. Banwari Lal Mittal and

Mr. Parimal KumarChattaraj

REMUNERATION/COMPENSATION COMMITTEE

The Remuneration/Compensation Committee of the Board of Directors presently comprises of:

Mr. Parimal Kumar Chattaraj - Chairman

Mr. Raj Narain Bhardwaj and

Mr. Deba Prasad Roy.

CORPORATE GOVERNANCE REPORT

The Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement forms part of the Annual Report.

Certificate from the Statutory Auditors M/s S. R. Batliboi & Co., Chartered Accountants regarding compliance with the conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with Stock Exchanges is annexed to the report.

Your Company has taken adequate steps for strict compliance with the Corporate Governance guidelines, as amended from time to time.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement with Stock Exchanges in India, is presented in a separate section forming part of the Annual Report.

CEO AND CFO CERTIFICATION

In accordance with the provisions of the Listing Agreement pertaining to corporate governance norms, Mr. Ravi Kant Sharma, MD & CEO and Mr. Giridhar Dhelia, CFO have certified inter-alia, about review of financial statements and

establishing & maintaining internal control to the financial reporting for the year ended 31st March, 2012. The said certificate forms an integral part of annual report.

AUDITORS AND AUDITORS' REPORT

M/s S. R. Batliboi & Co. (Regn. No. 301003E), Chartered Accountants, Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment.

The Company has received letter from the auditor to the effect that their re-appointment, if made, would be within the prescribed limits under Section 224(1B) of the Companies Act, 1956 and that they are not disqualified for re-appointment within the meaning of Section 226 of the said Act.

The Notes on Accounts referred to in the Auditors' Report are self-explanatory and do not call for any further comments. DEPOSITS AND LOANS/ADVANCES

During 2011-12, your Company did not accept/renew any deposits within the meaning of Section 58A of the Companies Act, 1956 and the rules there under and as such, no amount of principal or interest was outstanding as on the balance sheet date.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The Information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo as per Section 217 (1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is appended as Annexure "A" and forms part of this Report.

PARTICULARS OF EMPLOYEES AS REQUIRED UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956 AND RULES FRAMED THEREUNDER

As required under Section 217(2A) of the Companies Act, 1956 and Rules there under, no such employee of the Company's were in receipt of remuneration of more than Rs. 60,00,000 during the year ended 31st March, 2012 or of more than Rs. 5,00,000 per month during any part thereof.

HUMAN RESOURCE MANAGEMENT

Your Company places strong emphasis on its Human Resources and truly believes that they are its assets and a key competitive advantage. Efforts have been put in by your Company to ensure that best talent is recruited, continuously developed and retained. The Company is constantly working on providing the best working environment to its Human Resources with a view to inculcate leadership, autonomy and towards this objective, your Company spends large efforts on training. Your Company shall always place all necessary emphasis on continuous development of its Human Resources. Your Company strongly believes in fostering a culture of trust and mutual respect in all its employee relations Endeavour's.

ACKNOWLEDGMENT

Your Board place on record their sincere appreciation for the cooperation and support received from investors, shareholders, customers, business associates, bankers, vendors as well as regulatory and government authorities.

Your Board is very grateful to the independent Directors who despite their busy schedules have given their contributions and shared their valuable experience and knowledge with the management to take the Company forward. Your Board would also like to thank all the employees and staff of the Company and wish the management all the best for achieving even greater heights in the future.

Your directors are also deeply grateful to our shareholders for the confidence and faith placed in us.

For and on behalf of the Board

Place : Kolkata B. L. Mittal

Date : 23rd May, 2012 Chairman & Managing Director

Mar 31, 2011

To the Members,

The Directors have pleasure in presenting the 22nd Annual Report and the audited accounts of the Company for the financial year

FINANCIAL HIGHLIGHTS

A summary of Consolidated Financial results of the Company and its subsidiaries for the year ended 31st March, 2011 is given

(Rs. in Lacs)

Particulars Year ended 31.03.2011 Year ended 31.03.2010

Income 7,849.07 5,849.20

Profit before Interest, Depreciation & Tax 4,623.54 3,490.59

Less depreciation 255.86 312.19

Less: Interest 72.62 126.68

Profit before Taxation 4,295.06 3,051.72

Less Provision for Taxation 1017.06 616.87

Profit for the year 3,278.00 2,434.85

Balance brought forward from previous year 4,902.51 2,618.28

Add: Adjustment towards consolidation - 195.39

Balance Available for Appropriation 8,180.51 5,248.52

Appropriations

- Transfer to Reserve under Section 45-IC of the RBI Act, 1934 376.00 233.50

- Transfer to Debenture Redemption Reserve 12.50 12.50

- Transfer to Capital Redemption Reserve 2.00 100.00

- Proposed Dividend 318.10 -

-Dividend Tax thereon 51.61 -

Balance of Profit carried forward 7,420.30 4,902.52

A summary of Standalone Financial results for the year ended 31st March, 2011 is given below :

(Rs. in Lacs)

Particulars Year ended 31.03.2011 Year ended 31.03.2010

Income 2,724.31 1,809.75

Profit before Interest, Depreciation & Tax 2,465.78 1,547.12

Less depreciation 95.10 100.92

Less: Interest 19.12 72.28

Profit before Taxation 2,351.56 1,373.92

Less: Provision for Taxation 553.08 264.83

Profit for the year 1798.48 1109.09

Balance brought forward from previous year 1525.49 738.40

Balance Available for Appropriation 3323.97 1847.49

Appropriations

- Transfer to Reserve under Section 45-IC of the RBI Act, 1934 360.00 222.00

- Transfer to Capital Redemption Reserve - 100.00

- Proposed Dividend 318.10 -

- Dividend Tax thereon 51.61 -

Balance of Profit carried forward 2,594.26 1,525.49

REVIEW OF OPERATIONS

The Company's performance during the year registered reasonable growth over the previous year. On consolidated basis, the total income of the Company for the financial year ended 31st March, 2011 increased by 34.19% to Rs. 7849.07 Lacs and the profit after tax was Rs. 3278.00 Lacs, an increase of 34.63% over previous year. The business environment for the financial services industry in which the company operates, was steady for major part of financial year 2010-2011, except for last 4-5 months.

The detailed results of operations of the Company are given in the Management Discussion & Analysis forming part of this Report.

DIVIDEND

Keeping in view the overall performance during the year, your Directors are pleased to recommend a dividend of Rs. 1 per Equity Share on the face value of Rs. 10 each being 10% dividend, which if approved at the ensuing Annual General Meeting, payable to those members whose names appear in the Register of Members as on the Book Closure Date. The Dividend will absorb a sum of Rs. 369.71 Lacs including dividend distribution tax.

SUBSIDIARY COMPANIES AND CONSOLIDATED RESULTS OF OPERATIONS

As at 31st March, 2011, the Company's subsidiaries and step-down subsidiaries are as follows :

SI. No. Name

1 Microsec Capital Limited

2 Microsec Resources Private Limited

3 Microsec Technologies Limited

4 Microsec Commerze Limited

5 Microsec Insurance Brokers Limited

6 PRP Technologies Limited

During the year under review, Microsec Capital Limited (MCap), the 'Material Non-listed Subsidiary' of the Company earned the revenues of Rs. 2700.97 Lacs and Profit after Tax of Rs. 227.84 Lacs.

The Ministry of Corporate Affairs vide General Circular No: 2/2011 dated 8th February, 2011 has granted general exemption to all companies having subsidiaries from complying with the provision of Section 212 of the Companies Act. The Statement pursuant to Section 212(l)(e) of the Companies Act, 1956, relating to subsidiary companies forms part of the financial statements.

The Consolidated Financial Statements of your Company and its subsidiaries prepared in accordance with 'Accounting Standard - 21' prescribed by The Institute of Chartered Accountants of India, form part of the Annual Report and the Accounts

The copies of the Balance Sheet, Profit & Loss Account and Reports of the Board of Directors and Auditors of the subsidiaries of the Company as of 31st March, 2011 have not been attached with the annual report of the Company, the same can be sought by any member of the company on making a written request to company secretary. These documents will also be available for inspection at the Registered Office of the Company and the concerned subsidiary companies, during 2 p.m. to 5 p.m. on all working days.

INITIAL PUBLIC OFFER (IPO)

To augment the capital base for future growth plans, your Company made an Initial Public Offer (IPO) of 1,25,00,000 Equity Shares of Rs. 10 each ("the Shares") in the price band of Rs. 113 - Rs. 118 per share. The issue constituted 39.30% of the paid-up share capital of the Company.

Your Directors would like to state, with great pleasure, that the issue received an overwhelming response and was subscribed 12.35 times as per the bid-data after removing multiple and duplicate bids. After considering the cheque returns and technical rejections cases the Issue was subscribed 11.89 times. The issue price was fixed at Rs. 118 per Equity Share, being the upper end of the price band.

The Shares were allotted on 1st October, 2010 and got listed on Bombay Stock Exchange Limited and National Stock Exchange of India Limited on 5th October, 2010.

Consequent upon the Initial Public Offer, the paid-up share capital of the Company stands at Rs. 31,81,05,000 divided into 3,18,10,500 equity shares ofRs. 10 each.

STRATEGIC INVESTMENTS

The Food Processing Industry is a fast growing segment and hence your Company proposes to make strategic investment in MYJOY FUN AND FOOD PRIVATE LIMITED (MJFL), a food processing Company.

MJFL has been established with the objective of integrating the processes from farming, processing, packaging, warehousing, distribution and selling to consumer. The mam objectives of the Company is to provide, ethically sourced, best quality product, at the best prices.

Your Directors visualize tremendous potential in the integrated food processing business and expect the investment to yield good returns m the long run.

We also plan to make strategic investments in other growth oriented business including education.

DIRECTORS

In accordance with the provisions of Sections 255 and 256 of the Companies Act, 1956 and the Articles of Association of the Company Mr. Ravi Kant Sharma and Mr. Deba Prasad Roy, retire by rotation at the ensuing Annual General Meeting of the Company and being eligible offer themselves for re-appointment

Mr. Ravi Kant Sharma is appointed as the Managing Director and CEO of the Company by the Board of Directors, for a period of 3 years, with effect from 5th August, 2011, without any remuneration, subject to the approval of the members in the ensuing Annual General Meeting of the Company. Mr. Sharma is also the Managing Director in Microsec Capital Ltd. a material unlisted subsidiary of the Company.

During the year under review, Prof. (Dr.) Gourav Vallabh, joined the Board as an Additional Director on 9th November, 2010 and has been designated as Chairman of the Audit Committee and will hold office till the ensuing Annual General Meeting. Pursuant to Section 260 of the Companies Act, 1956, Prof. (Dr.) Gourav Vallabh holds office as an Additional Director upto the date of the ensuing Annual General Meeting but is eligible to be appointed as a Director. Approval of Members is being sought at the ensuing Annual General Meeting.

Brief resume of the Directors seeking appointment, reappointment, nature of their expertise in specific functional areas and names of companies in which they hold directorships and memberships/chairmanships of Board Committees, as stipulated under Clause 49 of the Listing Agreement, are provided in the Report on Corporate Governance forming part of the Annual Report.

Based on the confirmations received, none of the Directors are disqualified for appointment under Section 274(l)(g) of the Companies Act, 1956.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors confirm that:

(i) in the preparation of the annual accounts, the applicable accounting standards have been followed;

(ii) they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2011 and of the Profit of the Company for the year ended on that date;

(m) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

(iv) the annual accounts have been prepared on a going concern basis.

AUDIT COMMITTEE

The Audit Committee presently comprises of :

- Prof. (Dr.) Gourav Vallabh - Chairman

- Mr. Panmal Kumar Chattaraj

- Mr.RajNaramBhardwaj

- Mr. Deba Prasad Roy and

- Mr. Ravi Kant Sharma.

SHAREHOLDERS/INVESTORS' GRIEVANCE AND SHARE TRANSFER COMMITTEE

The Shareholders/Investors' Grievance and Share Transfer Committee of the Board of Directors presently compnses of :

- Mr. RajNarainBhardwaj-Chairman

- Mr. Panmal Kumar Chattaraj and

- Mr.BanwanLalMttal.

REMUNERATION AND NOMINATION COMMITTEE

The Remuneration and Nomination Committee of the Board of Directors presently compnses of :

- Mr. Panmal Kumar Chattaraj -Chairman

- Mr.RajNaramBhardwajand

- Mr. Deba Prasad Roy.

CORPORATE GOVERNANCE

The Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement forms part of the Annual Report.

Certificate of the Statutory Auditors of your Company regarding compliance of the condition of Corporate Governance as stipulated in Clause 49 of the Listing Agreement with Stock Exchanges is annexed to the report.

Your Company has taken adequate steps for strict compliance with the Corporate Governance guidelines, as amended from time to time.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges in India, is presented in a separate section forming part of the Annual Report.

CEO AND CFO CERTIFICATION

In accordance with the provisions of the Listing Agreement pertaining to corporate governance norms, Mr. Banwan Lai Mittal, CMD and Mr. Gindhar Dhelia, CFO have certified mter-alia, about review of financial statements and establishing & maintaining internal control to the financial reporting for the year ended 31st March, 2011. The said certificate forms an integral part of annual report.

AUDITORS AND AUDITORS' REPORT

M/s S. R Batliboi & Co. (Regn No. 301003E), Chartered Accountants, Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment

The Company has received letter from the auditor to the effect that their re-appointment, if made, would be within the prescribed limits under Section 224(1B) of the Companies Act, 1956 and that they are not disqualified for re-appointment within the meaning of Section 226 of the said Act.

The Notes on Accounts referred to in the Auditors' Report are self-explanatory and do not call for any further comments.

DEPOSITS

During 2010-11, your Company did not accept/renew any deposits within the meaning of Section 58A of the Companies Act, 1956 and the rules there under and as such, no amount of principal or interest was outstanding as on the balance sheet date.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The requirements of disclosure with regard to Conservation of Energy in terms of Section 217(l)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, are not applicable to the Company.

The Company's activities do not require any technology to be absorbed as mentioned in the aforesaid Rules. However, the Company makes all efforts towards conservation of energy, protection of environment and ensuring safety.

There was no inflow of foreign exchange during the year under review. Details of the foreign exchange outflow are given in the notes to Accounts.

PARTICULARS OF EMPLOYEES AS REQUIRED UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956 AND RULES FRAMED THEREUNDER

As required under Section 217(2A) of the Companies Act, 1956 and Rules There under, no such employee of the Company's were in receipt of remuneration of more than Rs. 60,00,000 during the year ended 31st March, 2011 or of more than Rs. 5,00,000 per month during any part thereof.

HUMAN RESOURCE MANAGEMENT

Your Company recognises the importance of human resources in creation of great organization and the same has been given proper care. Your Company was able to attract and retain best talent in the market and the same can be felt in the past growth of Microsec Group. The Company is constancy working on providing the best working environment to its Human Resources with a view to inculcate leadership, autonomy and towards this objective, your Company spends large efforts on training. Your Company is committed to providing career growth opportunities as a measure of retention strategy. Your Company shall always place all necessary emphasis on continuous development of its Human Resources. The belief "great people create great organization" has been at the core of the Company's approach to its people.

ACKNOWLEDGEMENTS

Your Directors place on record their sincere appreciation for the assistance and guidance provided by the government, regulators, stock exchanges, other statutory bodies and Company's bankers for the assistance, co-operation and encouragement extended to the Company.

Your Directors express their deep sense of appreciation for all the employees whose commitment, co-operation, active participation, dedication and professionalism has made the organisation's growth possible.

Your Directors also deeply grateful to our shareholders for the confidence and faith placed in us.

For and on behalf of the Board

Place :Kolkata B. L. Mittal

Date : 27th May, 2011 Chairman & Managing Director

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