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Directors Report of Starcom Information Technology Ltd.

Mar 31, 2016

DIRECTORS’ REPORT

To,

The Members,

STARCOM INFORMATION TECHNOLOGY LIMITED

The Directors have pleasure in presenting the Twenty First Annual Report of the Company and the Audited Financial Statements for the financial year ended 31st March 2016.

1. Financial summary or highlights/performance of the Company:

The financial highlights of the Company are given below. Kindly refer the financial statements forming part of this report for detailed financial information:

(Amt. in Rs.)

Particulars

2015-16

2014-15

Total Income

11,54,26,110

14,28,85,899

Total Expenditure

14,38,77,263

19,20,42,898

Profit/ (Loss) before Taxation

80,51,273

(4,91,56,999)

Less: Provision for Taxation

(11,99,078)

(87,88,905)

Net Profit after taxation

92,50,351

(4,03,68,094)

Balance carried forward to Balance Sheet

92,50,351

(4,03,68,094)

2. Brief description of the Company''s working during the year/ State of Company''s affair:

During the year under review your Company has achieved a turnover of Rs.11,48,50,396/- as compared to turnover of Rs. 10,29,43,725/- of previous year registering increase in turnover by 11.57%. The total expenses of the Company during the reporting period have decreased to Rs.14,38,77,263/- from Rs.19,20,42,898/- of the previous year. During the year under review, there was net profit after tax of Rs.92,50,351/- as compared to loss after tax of Rs.4,03,68,094/- during the previous financial year.

Your Directors assure to keep the growth momentum in coming years and strive for bright future of your Company.

3. Dividend:

Your Board of Directors expresses its inability to recommend any dividend for the financial year 2015-16.

4. Reserves:

The Company''s total reserve are Rs. -2,85,14,091/- for the year under review as compared to Rs. -3,77,64,443/- for the previous year.

5. Change in the nature of business, if any:

There was no change in nature of business.

6. Material changes and commitments, if any, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report:

No material changes took place, which had effect on the financial position of the Company, subsequent to the close of the financial year of the Company i.e. 31st March 2016 and the date of this report.

7. Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company’s operations in future:

During the year under review, no significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and Company''s operations in future.

8. Details of Subsidiary/Joint Ventures/Associate Companies:

The Company did not have any Subsidiary Company/Joint Venture/Associate Company during the year under review.

9. Details in respect of adequacy of internal financial controls with reference to the Financial Statements:

The Company has devised appropriate systems and framework for adequate internal financial controls with reference to financial statements commensurate with the size, scale and complexity of its operations including proper delegation of authority, policies and procedures, effective IT systems aligned to business requirements, risk based internal audit framework, risk management framework and whistle blower mechanism.

The Audit Committee regularly reviews the internal control system to ensure that it remains effective and aligned with the business requirements. In case weaknesses are identified as a result of the reviews, new procedures are put in place to strengthen controls.

During the year, controls were tested and no reportable material weakness in design and operation were observed. The Auditors also report in their report on adequacy of internal financial control.

10. Deposits:

During the year, the Company has not accepted any Deposits falling within the purview of Chapter V of the Companies Act, 2013 and Rules made there under. Therefore, the Company is not required to furnish information in respect of outstanding deposits under the Companies Act, 2013.

11. Directors and Key Managerial Personnel:

A. Changes in Directors and Key Managerial Personnel:

Mr. Laxminarayan Purohit (DIN: 03599758), Non-Executive Director of the Company tendered his resignation from the Board of the Company. The Board accepted his resignation with effect from 19th May 2016. The Board expresses its gratitude for the contributions made by Mr. Purohit towards the progress of the Company.

In accordance with the requirements of the Companies Act, 2013 and Articles of Association of the Company, Ms. Sayeeda Hina (DIN: 03642269), Non- Executive Director of the Company, retires at the ensuing Annual General Meeting and being eligible, offers herself, for re-appointment pursuant to provisions of Section 152 of the Act.

Further, in accordance with the requirements of the Companies Act, 2013 and Articles of Association of the Company, the term of Mr. Ziaulla Sheriff (DIN: 00002098) as the Chairman and Managing Director of the Company ended on 11th August 2016. The Board of Directors on the recommendation of Nomination and Remuneration Committee in their meeting held on 12th August 2016 approved the re-appointment of Mr. Ziaulla Sheriff as the Chairman and Managing Director of the Company with effect from 12th August 2016 for a period of three (3) years i.e. till 11th August 2019, subject to the approval of the Members of the Company in the ensuing Annual General meeting.

The Board recommends the re-appointment of Mr. Ziaulla Sheriff (DIN: 00002098), as the Chairman and Managing Director of the Company and of Ms. Sayeeda Hina (DIN: 03642269), as a Non-Executive (Woman) Director of the Company to the Members.

The Board of Directors, on recommendation of Nomination and Remuneration Committee, in their meeting held on 1st September 2015, had appointed Ms. Preeti Verma (Membership number- A39128) as the Whole-time Company Secretary (CS) designated as Compliance officer of the Company under the Listing Agreement and termed as the Whole-time Key Managerial Personnel (KMP) of the Company within the meaning of Section 203 of the Companies Act, 2013 with effect from 1st September 2015. However, she tendered her resignation from the post of Company Secretary and Compliance Officer of the Company with effect from 19th August 2016. The Board expresses its gratitude for the contributions made by Ms. Preeti Verma towards the Company. Further, the Board of Directors, on recommendation of Nomination and Remuneration Committee, in their meeting held on 12th August 2016 have appointed Ms. Nidhi Sharma (Membership Number A46079) as the Whole-time Company Secretary (CS) designated as Compliance officer of the Company under the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and termed as the Whole-time Key Managerial Personnel (KMP) of the Company within the meaning of Section 203 of the Companies Act, 2013 with effect from 20th August 2016.

B. Board Evaluation:

The Company has a Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors which include criteria for performance evaluation of the Non-Executive Directors and Executive Directors.

The Board and its Committee evaluations involved questionnaire-driven discussions that covered a number of key areas / evaluation criteria inter alia the roles and responsibilities, size and composition of the Board and its Committees, dynamics of the Board and its Committees and the relationship between the Board and management. The results of the reviews were discussed by the Board as a whole. Feedback was also sought on the contributions of individual Directors. Formal Annual Evaluation was made in compliance with all the applicable provisions of the Act. The Directors were satisfied with the evaluation results, which reflected the overall engagement of the Board and its Committees with the Company.

The Company believes that the Board be continuously empowered with the knowledge of the latest developments in the Company''s business and the external forces affecting the industry in which Company operates.

The following policies of the Company are attached herewith marked as Annexure 1:

1. Policy for selection of Directors and senior management and determining Directors independence and

2. Remuneration policy for Directors, Key Managerial Personnel and other employees.

Further, brief resume of the Directors proposed to be re-appointed relevant information, nature of their expertise in specific functional areas, names of the companies in which they hold directorships and the memberships/ chairmanships of Committees of the Board and their shareholding in the Company, as stipulated under Regulation 36(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Secretarial Standards -2 has been furnished separately in the notice convening the 21st Annual General Meeting read with the Annexure thereto forming part of this Report.

C. Declaration by an Independent Director(s) and re-appointment, if any:

The Company has received declaration u/s 149(7) of the Companies Act, 2013 from Mr. Maddur Gundurao Mohankumar (DIN: 00020029), Independent Director of the Company confirming that he meets the criteria of independence as prescribed under the Companies Act, 2013.

The Company has also received disclosure of interest by all the Directors as per the provisions of Section 184 of Companies Act, 2013.

12. Number of meetings of the Board of Directors:

The Board of Directors met Five (5) times during the Financial Year on 30th May 2015, 8th August 2015, 1st September 2015, 9th November 2015 and 12th February 2016. The intervening gap between any two meetings was not more than 120 days as prescribed by the Companies Act, 2013.

13. Details of Committees of the Board:

Currently the Board has 3 Committees; the Audit Committee, Stakeholders'' Relationship Committee and Nomination and Remuneration Committee. The composition of various committees and compliances, as per the applicable provisions of the Companies Act, 2013 along with the Rules made there under, brief details of various Committees are provided as follows:

i) Audit Committee:

The Board has an Audit Committee which comprises of three Directors. After the appointment of Ms. Preeti Verma as the Company Secretary & Compliance Officer of the Company, she was appointed as the secretary of the committee. Mr. Laxminarayan Purohit (DIN: 03599758) ceased to be a member of the committee with effect from 19th May 2016 pursuant to his resignation as a Non-Executive Director of the Company. Ms. Sayeeda Hina was appointed as the member of the Audit committee in his place with effect from 30th May 2016. The composition of the Audit Committee is as follows:

Name

Designation

Category

Mr. Maddur Gundurao Mohankumar (DIN: 00020029)

Chairman

Independent

Ms. Sayeeda Hina (DIN: 03642269) with effect from 30th May 2016

Member

Non-Executive

Mr. Ziaulla Sheriff (DIN: 00002098)

Member

Executive

All the members of the Audit Committee are financially literate and have accounting or related financial management expertise as required under the Companies Act, 2013.

The Company currently has only one Independent Director. The management is in the process of inducting the Independent Directors on the Board. On their appointment, the Company shall reconstitute the Committee.

All the major steps impacting the financials of the Company are undertaken only after the consultation of the Audit Committee.

During the year under review, the Board of Directors of the Company had accepted all the recommendations of the Committee.

ii) Nomination and Remuneration Committee:

The Board has Nomination and Remuneration Committee which comprises of three directors. Mr. Laxminarayan Purohit (DIN: 03599758) ceased to be a member of the committee with effect from 19th May 2016 pursuant to his resignation as a Non-Executive Director of the Company. Ms. Sayeeda Hina (DIN: 03642269) was appointed as the member of the Nomination and Remuneration Committee with effect from 30th May 2016. The composition of the Nomination and Remuneration Committee is as follows:

Name

Designation

Category

Mr. Maddur Gundurao Mohankumar (DIN: 00020029)

Chairman

Independent

Ms. Sayeeda Hina (DIN: 03642269) with effect from 30th May 2016

Member

Non-Executive

As per Section 178 of the Companies Act, 2013, Nomination and Remuneration Committee shall consist of 3 or more Non-Executive Directors out of which not less than one half shall be independent directors. After, the resignation of Mr. Laxminarayan Purohit, as the Non-Executive Director of the Company, there are only two Non-Executive Directors in the Company i.e. Mr. Maddur Gundurao Mohankumar (DIN: 00020029), Independent Director and Ms. Sayeeda Hina (DIN: 03642269), Non-Executive Director. The composition of Nomination and Remuneration Committee is not in conformity with Section 178 of the Companies Act, 2013. The management is in the process of inducting Independent Directors on the Board. On their appointment, the Company shall reconstitute the Committee.

The Company has framed a policy to determine the qualification and attributes for appointment and basis of determination of remuneration of all the Directors, Key Managerial Personnel and other employees. A copy of the policy is appended as Annexure 1 to the Board''s Report.

iii) Stakeholders’ Relationship Committee:

The Board has Stakeholders'' Relationship Committee comprising of three Directors. Mr. Laxminarayan Purohit (DIN: 03599758) ceased to be a member of the committee with effect from 19th May 2016 pursuant to his resignation as the Non Executive Director of the Company. Ms. Sayeeda Hina (DIN: 03642269) was appointed as the member of the Stakeholders'' Relationship Committee. The composition of the Stakeholders'' Relationship Committee is as follows:

Name

Designation

Category

Mr. Maddur Gundurao Mohankumar (DIN: 00020029)

Chairman

Independent

Ms. Sayeeda Hina (DIN: 03642269) with effect from 30th May 2016

Member

Non-Executive

Mr. Ziaulla Sheriff (DIN: 00002098)

Member

Executive

The role of the Committee is to consider and resolve securities holders'' complaint and to approve/ratify transfer of securities. The meetings of the Committee are held once in a quarter and the complaints, if any are responded and transfers are executed within the time frame provided.

iv) Corporate Social Responsibility Committee:

During the year under review, the Company did not fall within the purview of the Section 135 of the Companies Act, 2013 and it was not mandatory for the Company to constitute committee on Corporate Social Responsibility or incur any expenditure towards Corporate Social Responsibility. Hence the Company has not constituted the Corporate Social Responsibility Committee.

14. Corporate Governance:

The Company constantly strives to implement and comply with the requirements and disclosures of the Code of Corporate Governance as required under clause 49 of the Listing Agreement and corporate governance provisions as specified in SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, even though Clause 49 and the said corporate governance provisions are not mandatory to the Company.

15. Auditors:

At the Annual General Meeting held on 23rd December 2014, M/s. S G C O & Co., Chartered Accountants (Firm Registration No. 112081W), were appointed as the Statutory Auditors of the Company for 3 consecutive financial years i.e. till the financial year 2016-17. In terms of the first proviso to Section 139 of the Companies Act, 2013, the appointment of the auditors shall be placed for ratification at every Annual General Meeting. Accordingly, the appointment of M/s. S G C O & Co., Chartered Accountants, as the Statutory Auditors of the Company for the financial year 2016-17, is to be placed for ratification by the shareholders. In this regard, the Company has received a certificate from the Auditors to the effect that if their appointment is ratified at the ensuing Annual General Meeting, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013.

The Members are requested to ratify the appointment of the Statutory Auditors as aforesaid and fix their remuneration.

16. Auditors'' Report:

The observations in the Auditors'' Report are dealt in the notes forming Part of the accounts at appropriate places. The management''s reply to the observations in the Annexure to the Auditors'' Report is given under:

Clause No.

Auditors'' Remarks/ Observations

Management Reply

Annexure B

According to the information and explanation given to us and based on our audit, the following material weakness has been identified in the operating effectiveness of the Company''s internal financial controls over financial reporting as at 31st March, 2016:

The documentation in respect of specific policies and procedures and the IT Controls pertaining to internal financial controls over financial reporting are not adequate and needs to be further strengthened. This may potentially result in the risk of overriding of these controls and misstatement in recording of transaction.

A “material weakness” is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company''s annual or interim financial statements will not be prevented or detected on a timely basis

The Company has noted the same and has already started taking necessary steps to improvise the same.

(vii) a)

According to the records of the Company, amount deducted/ accrued in the books of accounts in respect of the undisputed statutory including Provident Fund, Employee''s State Insurance, Income tax, Sales tax, Service tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and other statutory dues to the extent applicable to the Company, have not been regularly deposited with the appropriate authorities. Undisputed amounts payable in respect thereof, which were outstanding as at 31st March 2015 for a period more than six months from the date they became payable are as follows.

Due to administrative and financial difficulties faced by the Company, there are irregularities in depositing the statutory dues with the appropriate authorities.

Name of the Statue

Nature of the dues

Amount (in Rs.)

The Income Tax Act, 1961

Tax Deduction at Source (TDS)

66,10,276

Finance Act, 1994

Service Tax

14,02,169

The Employee''s Provident Fund and Miscellaneous Provisions Act, 1952

Provident Fund

19,83,656

17. Secretarial Audit Report:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board had appointed M/s. Hemanshu Kapadia & Associates, Practicing Company Secretaries, to undertake the Secretarial Audit of the Company for the financial year 2015-16 and issue Secretarial Audit Report. The Secretarial Audit Report issued by M/s. Hemanshu Kapadia & Associates for the financial year 2015-16 in Form MR-3 forms part of this report and marked as Annexure 3. The reply from the Board on the remarks/ qualifications of the Secretarial Auditors is as under:

Sr. No.

Remarks/qualifications by Secretarial Auditor

Management Reply

1.

The minimum public shareholding in the Company is not inconformity with Rule 19(2) and Rule 19A of the Securities Contracts (Regulation) Rules, 1957 and Clause 38 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The public shareholding of the Company is less than 25% of the total paid-up share capital of the Company.

The Company has made an application for grant of permission to sell of promoter shares on the floor of the stock exchange. The approval is awaited.

2.

The Company has not appointed a whole time Chief Financial officer, as required pursuant to Section 203 of the Companies Act, 2013.

The Company was constantly trying to appoint a Chief Financial Officer but due to lack of suitable candidates, no appointment could be made. The Company is still searching for a suitable candidate for the post of Chief Financial Officer.

3.

The Company had not appointed a whole time Company Secretary pursuant to Section 203 of the Companies Act, 2013 and Clause 47(a) of the Listing Agreement up to 31st August 2015. However, the Company Secretary was appointed with effect from 1st September 2015

In the Board meeting held on 1st September 2015, the Board has appointed a Whole time Company Secretary and since complied with the provisions of the Act.

4.

The Board of Directors of the Company is not duly constituted as required under the provisions of Section 149 (4) of the Companies Act, 2013. The Company had 4 Directors, out of which only one is an Independent Director. Due to this, the Composition of Audit Committee and Nomination and Remuneration Committee is not in conformity with the Section 177 and Section 178 of the Companies Act, 2013 respectively.

The Company is in the process of inducting Independent Directors on the Board. Upon the appointment, the Board shall reconstitute the Audit Committee and Nomination and Remuneration Committee.

18. Extract of the Annual Return:

In accordance with Section 134(3)(a) of the Companies Act, 2013, read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of the Annual Return in Form MGT - 9 is annexed to the Directors'' Report as Annexure 4.

19. Details of establishment of vigil mechanism for Directors and employees:

The Vigil Mechanism of the Company, provides Directors and Employees to report their concerns and has also taken steps to safeguard any person using this mechanism from victimization and in appropriate and exceptional cases, there is direct access to approach Mr. Maddur Gundurao Mohankumar (DIN: 00020029), Chairman of the Audit Committee. Protected disclosures can be made by a whistle blower through an e-mail, or dedicated telephone line or a letter to the Chairman of the Audit Committee. The policy on vigil mechanism/ whistle blower policy may be accessed on the Company''s website at http://www.google.com/ url?q=http%3A%2F%2Fwww.starcominfotech.com%2Fimages%2Fstarcom%2Fpdfs%2FVigilMechanism.pdf&sa=D&sntz=1&u sg=AFQiCNGhtMcQJniIHHCG87 pR4Eka-OuEw.

20. Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013:

The Company has in place an Anti-sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Complaints Committee (ICC) has been setup to redress the complaints received regarding sexual harassment. All employees are covered under this Policy. The policy is gender neutral.

During the year under review there were no cases filed/pending with respect to sexual harassment.

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

The particulars as prescribed under Sub-Section (3)(m) of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 are as follows:

A) Conservation of energy:

i) The steps taken or impact on conservation of energy;

Your Company is in service industry and not having manufacturing activity. The Company is not covered under the list of specified industries. However the Company on continuous basis takes measures for conservation of power.

ii) The steps taken by the Company for utilizing alternate sources of energy:

The Company is using electricity as main source of its energy requirement and does not have any alternate source of energy.

iii) The capital investment on energy conservation equipment:

Not Applicable

B) Technology absorption:

i) The efforts made towards technology absorption:

The Company evaluates the best available technology for improving its performance and quality of its service operations.

ii) The benefits derived like product improvement, cost reduction, product development or import substitution:

The Company has not absorbed/made any new technology during the year.

iii) In case of imported technology (imported during the last three years reckoned from the beginning of the financial year):

No technology has been imported by the Company.

iv) The expenditure incurred on Research and Development: Nil

C) Foreign exchange earnings and Outgo:

The information relating to the total foreign exchange used and earned by the Company is given below:

Particulars

Financial year 2015-16

Financial year 2014-15

Foreign Exchange inflow

2,78,15,829

5,69,15,726

Foreign Exchange outflow

1,44,557

1,78,465

22. Particulars of loans, guarantees or investments under Section 186:

During the year under review, the Company has not provided any loans, made investments, gave guarantees or subscribed/ purchased securities under Section 186 of the Companies Act, 2013.

23. Particulars of contracts or arrangements with related parties:

The particulars of every contract or arrangements entered into by the Company with related parties referred to in sub-Section (1) of Section 188 of the Companies Act, 2013 including transactions entered at arm''s length under third proviso, in prescribed Form No. AOC -2, is appended as Annexure 2 to the Board''s Report.

24. Directors’ Responsibility Statement:

As stipulated under clause (c) of sub-Section (3) of Section 134 of the Companies Act, 2013, your Directors subscribe to the Directors'' Responsibility Statement and state that:

a) In preparation of the annual accounts for the financial year ended 31st March 2016, the applicable accounting standards had been followed and there are no material departures from them;

b) the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March 2016 and of the profit and loss of the Company for the year ended on that date;

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

d) the Directors had prepared the annual accounts on a going concern basis;

e) the proper internal financial controls are in place and that the financial controls are adequate and are operating effectively during the financial year ended 31st March 2016; and

f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively during the financial year ended 31st March 2016.

25. Managerial Remuneration:

A) The information required to be disclosed with respect to the remuneration of Directors and KMPs in the Directors'' Report pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as Annexure 5.

B) There was no employee drawing remuneration more than the limit mentioned under Rule 5(2)(i) to (iii) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

C) The names of top ten employees of the Company in terms of remuneration drawn as required pursuant to Section 197 of the Companies Act, 2013, read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 read with the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2016 is set out as Annexure 6.

D) The Company does not have any Holding Company or Fellow Subsidiary Company and thus, provision w.r.t. receipt of commission from them is not applicable.

26. Risk management policy:

The Company''s robust risk management framework identifies and evaluates all the risks that the organization faces such as strategic, financial, credit, market, liquidity, security, property, legal, regulatory, reputational and other risks. The Company recognizes that these risks need to be managed and mitigated to protect its shareholders and other stakeholders, to achieve its business objectives and enable sustainable growth. The risk framework is aimed at effectively mitigating the Company''s various business and operational risks, through strategic actions.

Risk management is an integral part of our critical business activities, functions and processes. The risks are reviewed for the change in the nature and extent of the major risks identified since the last assessment. It also provides control measures for risks and future action plans.

The Board periodically discussed and reviewed the Risk Management Policy to strengthen the optimal risk mitigation responses, reporting of risk and efficient management of internal control. The Company believes that the overall risk exposure of present and future risks remains within risk capacity.

27. Management Discussion and Analysis:

As required under Regulation 34 read with Schedule V(B) of SEBI (Listing Obligation and Disclosure Requirements), Regulations, 2015, report on “Management Discussion and Analysis” is attached as Annexure - 7 and forms a part of this Report.

28. General:

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

a) Issue of equity shares with differential rights as to dividend, voting or otherwise.

b) Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

c) Voting rights which are not directly exercised by the employees in respect of shares for the subscription/ purchase of which loan was given by the Company (as there is no scheme pursuant to which such persons can beneficially hold shares as envisaged under Section 67(3)(c ) of the Companies Act, 2013).

d) Explanation for deviation in use proceeds of public issue, rights issue, preferential issue etc.

29. Acknowledgements:

The Directors express their deep gratitude for the co-operation and support extended to your Company by its customers, suppliers, bankers and various government agencies. Your Directors also place on record the commitment and involvement of the employees at all levels and looks forward to their continued co-operation. The Directors are also thankful to the Shareholders for their continued support to the Company.

For and on behalf of the Board of Directors

Sd/-

Ziaulla Sheriff

Chairman and Managing Director

DIN: 00002098

Address: Al-Barka Golden Enclave,

Airport Road, Bangalore-560017

Date: 31st August 2016

Place: Bangalore


Mar 31, 2015

To

The Members,

STARCOM INFORMATION TECHNOLOGY LIMITED

The Directors have pleasure in presenting the Twentieth Annual Report of the Company and the Audited Financial Statement for the financial year ended 31st March 2015.

1. Financial summary or highlights/Performance of the Company:

The financial highlights of the Company are given below:

(Rs. In Lacs)

Particulars 2014-15 2013-14

Income 1428.85 1822.36

Expenditure 1920.42 1697.52

Profit/(Loss) before Taxation (491.56) 124.84

Less: Provision for Taxation (87.88) 38.07

Net Profit after taxation (403.68) 86.77

Profit/(Loss) brought forward from previous year 26.03 (60.73)

Balance carried forward to Balance Sheet (377.64) 26.03

2. Brief description of the Company,s working during the year/ State of Company,s affair:

During the year, the Company,s performance has been rated at average through regular business operations. The total turnover during the year has seen a decrease due to decrease in the government grants to educational segments despite which the sales and services made to educational segments have remained at 40% of the turnover.

The significant change can be noticed in the growth of revenue contribution from Data Analytics segments which is the core objective of the Company. The level of contribution of revenue from Data Analytics Services was at 30% during the previous year. The management of the Company is optimistic about this growth during the forthcoming years which would also contribute significantly towards growth of consolidated revenues and the profitability.

Your Directors assure to keep the growth momentum in coming years and strive for bright future for your Company.

3. Dividend:

In view of losses, your Board expresses its inability to recommend any dividend for the financial year 2014-15.

4. Reserves:

The Board does not propose to carry any amounts to reserves.

5. Change in the nature of business, if any:

There was no change in nature of business.

6. Material changes and commitments, if any, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report:

No material changes have occurred subsequent to the close of the financial year of the Company to which the balance sheet relates and the date of the report.

7. Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company,s operations in future:

During the year under review, no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company,s operations in future.

8. Details of Subsidiary/Joint Ventures/Associate Companies:

The Company does not have any Subsidiary Company/Joint Venture/Associate Company during the year under review.

9. Details in respect of adequacy of internal financial controls with reference to the Financial Statements:

The Company has devised appropriate systems and framework for adequate internal financial controls with reference to financial statements commensurate with the size, scale and complexity of its operations including proper delegation of authority, policies and procedures, effective IT systems aligned to business requirements, risk based internal audit framework, risk management framework and whistle blower mechanism.

The Audit Committee regularly reviews the internal control system to ensure that it remains effective and aligned with the business requirements. In case weaknesses are identified as a result of the reviews, new procedures are put in place to strengthen controls.

The Company has implemented various policies such as code of conduct, whistle-blower policy, insider trading policy, Risk Management Policy, etc.

During the year, controls were tested and no reportable material weakness in design and operation were observed.

10. Deposits:

During the year, the Company has not accepted any Deposits falling within the preview of Chapter V of the Companies Act, 2013 and Rules made there under. Therefore, the Company is not required to furnish information in respect of outstanding deposits under the Companies Act, 2013.

11. Directors and Key Managerial Personnel:

A. Changes in Directors and Key Managerial Personnel:

In accordance with the requirements of the Companies Act, 2013 and Articles of Association of the Company, Mr. Laxminarayan Purohit (DIN: 03599758), Non- Executive Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself, for re-appointment pursuant to provision of Section 152 of the Act. The Board recommends the re-appointment to the Members.

During the year, the members in the 19th Annual General Meeting held on 23rd December 2014 had approved the appointment of Ms. Sayeeda Hina Ahmed (DIN: 03642269), as a Non-executive Director and Mr. Maddur Gundurao Mohankumar (DIN: 00020029), as an Independent Non-Executive Director in the Company, not liable to retire by rotation, for the term of 5 years.

The Board of Directors in their meeting held on 1st September 2015, have appointed Ms. Preeti Verma (Membership number- A39128) as the Whole-time Company Secretary designated as Key Managerial Personnel and Compliance officer of the Company w.e.f 1st September 2015.

B. Board Evaluation:

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, of individual Directors as well as the evaluation of the working of its Audit, Nomination & Remuneration and Compliance Committees.

The performance of each director was evaluated by the entire Board of Directors (in the absence of the Director getting evaluated) on various parameters like engagement, leadership, analysis, decision making, communication, governance, interest of stakeholders decision making, functional knowledge, etc. The Board was of the unanimous view that all the Directors were providing good business and people leadership.

The Company believes that the Board be continuously empowered with the knowledge of the latest developments in the Company,s business and the external forces affecting the industry in which Company operates.

The details of the programs for familiarization of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company at the link : http://www.starcominfotech.com/policies.html

The following policies of the Company are attached herewith marked as Annexure 1:

1. Policy for selection of Directors and senior management and determining Directors independence and

2. Remuneration policy for Directors, Key Managerial Personnel and other employees.

Further brief resume of the Director proposed to be re-appointed as stipulated under clause 49 of the Listing Agreement has been furnished separately in the Notice convening the 20th Annual General Meeting read with the Annexure thereto forming part of this Report.

Details of the number of meetings of the Board of Directors have been furnished in the Report of Corporate Governance.

C. Declaration by an Independent Director(s) and re-appointment, if any:

The Company has received declaration u/s 149(7) of the Act from Mr. Maddur Gundurao Mohankumar (DIN: 00020029), Independent Director of the Company confirming that he meets the criteria of independence as prescribed both under the Act and Clause 49 of Listing Agreement with Stock Exchanges.

The Company has also received disclosure of interest by all the Directors as per the provisions of Section 184 of Companies Act, 2013.

12. Number of meetings of the Board of Directors:

The Board of Directors met Six (6) times during the Financial Year on 29th May 2014, 13th August 2014, 23rd September 2014, 8th November 2014, 26th December 2014 and 14th February 2015. The intervening gap between any two meetings was not more than 120 days as prescribed by the Companies Act, 2013.

13. Details of Committees of the Board:

Currently the Board has 3 Committees; the Audit Committee, Stakeholders, Relationship Committee and Nomination and Remuneration Committee. The composition of various committees and compliances, as per the applicable provisions of the Companies Act, 2013 along with the Rules and Listing agreement, brief details of various Committees is also provided separately in the Corporate Governance Report:

i) Audit Committee:

The Board has an Audit Committee comprising three Directors. The composition of the Audit Committee is as follows:

Name Designation Category

Mr. Maddur Gundurao Mohankumar (DIN: 00020029) Chairman Independent

Mr. Laxminarayan Purohit (DIN: 03599758) Member Non-Executive

Mr. Ziaulla Sheriff (DIN: 00002098) Member Executive

All the members of the Audit committee are financially literate and have accounting or related financial management expertise as required under the Companies Act, 2013 and Clause 49 of the Listing Agreement. During the year under review, Mr. Ziaulla Sheriff acted as the Secretary to the Committee. The Company currently has only one Independent Director. The management is in the process of inducting the Independent Directors on the Board. On their appointment, the Company shall reconstitute the Committee.

The scope and terms of reference of the Audit Committee have been amended in accordance with the Act and the Listing Agreement entered into with the Stock Exchanges.

All the major steps impacting the financials of the Company are undertaken only after the consultation of the Audit Committee.

During the year under review, the Board of Directors of the Company had accepted all the recommendations of the Committee.

ii) Stakeholders, Relationship Committee:

The Board has Stakeholders, Relationship Committee in conformity with the Listing Agreement comprising of three Directors. The composition of the Stakeholders, Relationship Committee is as follows:

Name Designation Category

Mr. Maddur Gundurao Mohankumar (DIN: 00020029) Chairman Independent

Mr. Laxminarayan Purohit (DIN: 03599758) Member Non-Executive

Mr. Ziaulla Sheriff (DIN: 00002098) Member Executive

The role of the Committee is to consider and resolve securities holders, complaint and to approve/ratify transfer of securities. The meetings of the Committee are held once in a quarter and the complaints are responded and transfers are executed within the time frame provided.

iii) Nomination and Remuneration Committee:

The Board has Nomination and Remuneration Committee. The composition is as below:

Name Designation Category

Mr. Maddur Gundurao Mohankumar (DIN: 00020029) Chairman Independent

Mr. Laxminarayan Purohit (DIN: 03599758) Member Non-Executive

Ms. Sayeeda Hina Ahmed (DIN: 03642269), Member Non-Executive

As per Section 178 of the Companies Act, 2013, Nomination and Remuneration Committee shall consist of 3 or more Non- Executive Directors out of which not less than one half shall be independent directors. The Company currently has only one Independent Director. The management is in the process of inducting the Independent Directors on the Board. On their appointment, the Company shall reconstitute the Committee. The Committee has framed a policy to determine the qualification and attributes for appointment and basis of determination of remuneration of all the Directors, Key Managerial Personnel and other employees. A copy of the policy is appended as Annexure 1 to the Board,s Report.

iv) Corporate Social Responsibility Committee:

During the year under review, the Company did not fall within the purview of the Section 135 of the Companies Act, 2013 and it was not mandatory for the Company to constitute committee on Corporate Social Responsibility or expend on such activity.

14. Corporate Governance:

The Company constantly strives to implement and comply with the requirements and disclosures of the Code of Corporate Governance as required under clause 49 of the Listing Agreement (as amended), even though Clause 49 is not mandatory to the Company w.e.f 1st October 2014, as per the revised Listing Agreement. A report on Corporate Governance as stated above, forms part of this Report as Annexure 7.

15. Auditors:

At the Annual General Meeting held on 23rd December 2014, M/s. S G C O & Co., Chartered Accountants (Firm Registration No. 112081W), were appointed as Statutory Auditors of the Company for 3 consecutive financial years i.e. till the financial year 2016-17. In terms of the first proviso to Section 139 of the Companies Act, 2013, the appointment of the auditors shall be placed for ratification at every Annual General Meeting. Accordingly, the appointment of M/s. S G C O & Co., Chartered Accountants, as the Statutory Auditors of the Company for the financial year 2015-16, is to be placed for ratification by the shareholders. In this regard, the Company has received a certificate from the Auditors to the effect that if their appointment is ratified at the ensuing Annual General Meeting, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013.

The Members are requested to ratify the appointment of the Statutory Auditors as aforesaid and fix their remuneration.

16. Auditors, Report:

The observations in the Auditors, Report are dealt in the notes forming Part of the accounts at appropriate places. The management,s reply to the observations in the Annexure to the Auditors, Report is given under:

Clause Auditors, Remarks/ Observations Management Reply

No.

(iv) In our opinion, the internal control system with regards The management has appointed the Internal Auditors to purchase of fixed assets, goods and for the sale of to strengthen the internal control systems with regards goods and services needs to be strengthened so as to purchase of fixed assets, goods and for the sale of to commensurate with the size of the Company and the goods and services. nature of its business.

(vii) a) As per books and records examined by us, undisputed Due to administrative and financial difficulties faced by statutory dues including Provident Fund, Income tax, Sales the Company, there are irregularities in depositing the tax, Wealth tax, Service tax, Duty of Customs, Duty of statutory dues with the appropriate authorities.

Excise, Value Added Tax and Cess, to the extent applicable to the Company, have not been regularly deposited with the appropriate authorities. Undisputed amounts payable in respect thereof, which were outstanding as at 31st March, 2015 for a period more than six months from the date they became payable are as follows.

Name of the Statue Nature of the dues Amount (in Rs.)

The Income Tax Act, Tax Deduction at 20,26,979 1961 Source

Finance Act, 1994 Service Tax 705,057

(ix) In our opinion and according to the information and The Company has made the settlement with the explanation given to us, the Company has defaulted in Bank and is in the process of settling the temporary repayment of temporary overdraft facility amounting to overdraft facility availed from the Jammu and Kashmir Rs. 16,77,02,844 towards Principal and Rs. 4,71,07,160 Bank. towards interest to the Jammu & Kashmir Bank, which has been classified as NPA by the Bank. Refer Note no. 7 to the financial statements.

17. Secretarial Audit Report:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board had appointed M/s. Hemanshu Kapadia & Associates, Practicing Company Secretary, to undertake the Secretarial Audit of the Company for the financial year 2014-15 and issue Secretarial Audit Report. The Secretarial Audit Report issued by M/s. Hemanshu Kapadia & Associates for the financial year 2014-15 in Form MR-3 forms part of this report and marked as Annexure 3. The reply from the Board on the remarks/qualifications of the Secretarial Auditors are as under:

Sr. Remarks/ qualifications by Secretarial Auditor Management Reply No.

1. The minimum public shareholding in the Company is The promoter of the Company, Mr. Ziaulla Sheriff, made 2 not in conformity with Rule 19(2) and Rule 19A of the separate Offer for sale (OFS) to sale off the shares held by Securities Contracts (Regulation) Rules, 1957 and Clause him. But the offer failed and shares were not subscribed by 40 of the Listing Agreement. The public shareholding of the public. Thereafter, he applied for selling the shares in the Company is less than 25% of the total paid-up share the open market but his application was rejected by SEBI. capital of the Company. The promoter of the Company Mr. However, during the year under review, the shareholding Ziaulla Sheriff holds 76.728% of the total paid-up share has come down from 88.72% (4436426 shares) to 76.73% capital of the Company. (3836857 shares). The promoter is taking necessary steps to reduce the holding in the near future.

2. The Company has not appointed a whole time Company The Company was constantly trying to appoint a whole Secretary and Chief Financial officer, as required pursuant time Company Secretary and Chief Financial Officer but to Section 203 of the Companies Act, 2013. due to lack of suitable candidates, no appointment was made till the year ended 31st March 2015. In the Board meeting held on 1st September 2015, the Board has appointed a Whole time Company Secretary and since complied with the provisions of the Act. The Company is still searching for a suitable candidate for the post of Chief Financial Officer.

3. The Board of Directors of the Company is not duly The Company is in the process of Inducting Independent constituted as required under the provisions of Section Directors on the Board. Upon the appointment, the Board 149 (4) of the Companies Act, 2013 and Clause 49 (I)(A) shall reconstitute the Audit Committee and Nomination (ii) of the Listing Agreement (up to 30th September 2014). and Remuneration Committee.

The Company has 4 Directors, out of which only one is an Independent Director. Due to this, the Composition of Audit Committee and Nomination and remuneration committee is not in conformity with the Companies Act, 2013 and the Listing Agreement (up to 30th September 2014).

18. Extract of the Annual Return:

In accordance with Section 134(3)(a) of the Companies Act, 2013, read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of the Annual Return in Form MGT - 9 is annexed to the Directors, Report as Annexure 4.

19. Details of establishment of vigil mechanism for Directors and employees:

The Vigil Mechanism of the Company, which also incorporates a whistle blower policy in terms of the Listing Agreement, provides Directors and Employees to report their concerns and has also taken steps to safeguard any person using this mechanism from victimization and in appropriate and exceptional cases, there is direct access to approach Mr. Maddur Gundurao Mohankumar (DIN: 00020029), Chairman of the Audit Committee. Protected disclosures can be made by a whistle blower through an e-mail, or dedicated telephone line or a letter to the Chairman of the Audit Committee. The policy on vigil mechanism/ whistle blower policy may be accessed on the Company,s website at the link: http://www.starcominfotech.com/policies.html

20. Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013:

The Company has in place an Anti-sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Complaints Committee (ICC) has been setup to redress the complaints received regarding sexual harassment. All employees are covered under this Policy. The policy is gender neutral.

During the year under review there were no cases fled/pending.

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

The particulars as prescribed under Sub-Section (3)(m) of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 are as follows:

A) Conservation of energy:

i) the steps taken or impact on conservation of energy;

The Company is not covered under the list of specifed industries. However the Company on continuous basis takes measures for conservation of power.

ii) The steps taken by the Company for utilizing alternate sources of energy:

The Company is using electricity as main source of its energy requirement and does not have any alternate source of energy.

iii) The capital investment on energy conservation equipments:

Not Applicable

B) Technology absorption:

i) The efforts made towards technology absorption:

The Company has been making continuous investments on successful adoption of technology for the benefit of its customers, suppliers and employees.

ii) The benefits derived like product improvement, cost reduction, product development or import substitution:

The benefits are estimated to arrive over a life cycle ranging from 6-10 years and the cost of the developments has been amortized over the same period.

iii) In case of imported technology (imported during the last three years reckoned from the beginning of the financial year):

No technology has been imported by the Company.

iv) The expenditure incurred on Research and Development: Nil

22. Particulars of loans, guarantees or investments under Section 186:

During the year under review, the Company has not provided any loans, made investments, given guarantees or subscribed/ purchased securities under Section 186 of the Companies Act, 2013.

23. Particulars of contracts or arrangements with related parties:

The particulars of every contract or arrangements entered into by the Company with related parties referred to in sub-Section (1) of Section 188 of the Companies Act, 2013 including transactions entered at arm,s length under third proviso, in prescribed Form No. AOC -2, is appended as Annexure 2 to the Board,s Report. The policy can be accessed at the web link: http://www. starcominfotech.com/policies.html

24. Directors, Responsibility Statement:

As stipulated under clause (c) of sub-Section (3) of Section 134 of the Companies Act, 2013, your Directors subscribe to the Directors, Responsibility Statement and state that:

a) In preparation of the annual accounts, the applicable accounting standards had been followed and there are no material departures from them;

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

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

d) the Directors had prepared the annual accounts on a going concern basis;

e) the proper internal financial controls are in place and that the financial controls are adequate and are operating effectively; and

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

25. Managerial Remuneration:

A) The information required to be disclosed with respect to the remuneration of Directors and KMPs in the Directors, Report pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 pertaining to the ratio of the remuneration of each Director to the median employee,s remuneration is attached as Annexure 5.

B) Details of every employee of the Company as required pursuant to Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 -

The Company has one employee drawing remuneration more than the limit mentioned under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The details are attached as Annexure 6.

C) The Company does not have any Holding Company or Fellow Subsidiary Company and thus, provision w.r.t. receipt of commission from them is not applicable.

26. Risk management policy:

During the year, your Directors had discussed the various risks for Company and framed the Risk Management Policy containing Company,s enterprise wide risk management framework and covering all the risks identified which the organization faces such as strategic, financial, credit, market, liquidity, Management Personnel related risk and other risks. There is an adequate risk management infrastructure in place capable of addressing those risks. Further, the Risk Management Policy was reviewed and approved by the Committee.

The Management manages, monitors and reports on the principal risks and uncertainties that can impact its ability to achieve its strategic objectives. The Company,s management systems, organizational structures, processes, standards, code of conduct and behaviors together form the Risk Management System (RMS) that governs how the Management conducts the business of the Company and manages associated risks.

The Board periodically discussed and reviewed the Risk Management Policy to strengthen the optimal risk mitigation responses, reporting of risk and efficient management of internal control.

27. Management Discussion and Analysis:

The Management Discussion and Analysis Report for the financial year under review as stipulated under the Listing Agreement entered with the Stock Exchange forms part of this Annual Report as Annexure 8.

28. General:

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

a) Issue of equity shares with differential rights as to dividend, voting or otherwise.

b) Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report.

c) Voting rights which are not directly exercised by the employees in respect of shares for the subscription/ purchase of which loan was given by the Company (as there is no scheme pursuant to which such persons can beneficially hold shares as envisaged under Section 67(3)(c ) of the Companies Act, 2013).

29. Acknowledgements:

The Directors express their deep gratitude for the co-operation and support extended to your Company by its customers, suppliers, bankers and various government agencies. Your Directors also place on record the commitment and involvement of the employees at all levels and looks forward to their continued co-operation.

The Directors are also thankful to the Shareholders for their continued support to the Company.

For and on behalf of the Board of Directors

Sd/-

Ziaulla Sheriff

Chairman and Managing Director

DIN: 00002098

Date: 1st September 2015 Address: Al-Barka Golden Enclave,

Place: Bangalore Airport Road, Bangalore-560017


Mar 31, 2014

The Members,

The Directors are hereby presenting the Nineteenth Annual Report of your Company together with the audited statements of accounts for the year ended 31st March 2014.

1. FINANCIAL HIGHLIGHTS:

(in Rs.)

Financial Results For the year ended For the year ended 31st March 2014 31st March 2013

Income 182,354,017 25,529,741

Expenditure 169,869,805 39,050,054

Profit/ (Loss) before Taxation 12,484,212 (13,520,314)

Less: Provision for Taxation 3,807,138 104,198

Net Profit after taxation 8,677,074 (13,416,115)

Profit/(Loss) brought forward (6,073,432) 7,342,692 from previous year

Balance carried forward to 2,603,651 (6,073,423) Balance Sheet

2. OPERATIONS & PROSPECTS:

The operations of the Company have grown signifi cantly during the year under review. The discussions for strategic alliances are at an advanced stage with two companies from United States and Australia.

Your Company has different projects on hand which include Analytical Data Services, Multi-designing services, dealerships in electronic products and trading software programs used in educational services.

3. DIVIDEND:

In view of earlier losses being set off against the profits of the current year, your Directors do not recommend any dividend for the year under review.

4. DIRECTORS:

During the year under review, Mr. Ziaulla Sheriff, Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible has offered himself for reappointment. The Board of Directors has received declaration from all the Directors informing that they are not disqualifi ed under Section 274(1)(g) of the Companies Act, 1956.

Mrs. Sayeeda Hina Ahmed (DIN 03642269) who was appointed as an Additional Director of the Company at Board of the Directors meeting held on 8th November 2014, who shall hold office upto the date of ensuing Annual General Meeting and in respect of whom the Company has received notice under Section 160 of the Companies Act, 2013 is proposed to be appointed as a Non-Executive Director.

As per Section 152 of the Companies Act, 2013, Mr. Mohan Kumar Maddur Gundurao (DIN 00020029), Non-Executive Director of the Company was appointed as Independent Director of the Company w.e.f. 8th November 2014. A notice in writing pursuant to Section 160 of the Companies Act 2013 has been received from a member proposing his candidature for the office of Independent Director of the Company, being eligible is proposed to be appointed as an Independent Director of the Company who shall not be liable to retire by rotation.

The Board recommends the resolutions set out in the Notice of the 19th Annual General Meeting for the approval of the members. A brief profi le of all the above 3 Directors as required under Clause 49(VI)(A) of the Listing Agreement is given in the Notice of the ensuing Annual General Meeting.

5. REGISTERED OFFICE:

The Company has received the Order of the Regional Director, Western Region Bench for shifting the registered office of the Company from the state of Maharashtra to the state of Karnataka. The order has been fi led with the Registrar of Companies in form INC 22 and the form is yet to be approved.

6. FIXED DEPOSITS:

The Company has not accepted any fixed deposits from the public during the year under review.

7. PARTICULARS OF EMPLOYEES:

Pursuant to Section 217(2A) of the Companies Act, 1956, the Directors have to inform that there was one employee covered under the Section during the period of review. The required information is disclosed through the annexure attached.

8. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO:

The information as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in Report of the Board of Directors) Rules, 1988 with respect to conservation of energy, technology absorption and foreign exchange earnings is given below:

A. Conservation of Energy:

The Company is not covered under the list of specifi ed industries. However the Company on continuous basis takes measures for conservation of power.

B. Technology Absorption, Adaptation and innovation:

There was no technology absorption, adaptation and innovation during the year.

C. Foreign Exchange Earnings and Outgoings:

Foreign Exchange Earning:

Particulars Year Ended Year Ended 31st March 2014 31st March 2013

Sales 25,139,720 -

Software Development 43,748,580 17,067,447 Services

Business Facilities 14,237,564 883,380 Income

Total 83,125,864 17,950,827

Foreign Exchange Outgoings:

Particulars Year Ended Year Ended 31st March 2014 31st March 2013

Staff Welfare 402,309 -

Travelling Expenses 183,719 -

Total 586,028 -

9. CORPORATE GOVERNANCE:

Your Company adheres to the requirements set out by the Securities and Exchange Board of India. The Company has taken adequate steps to comply with the applicable provisions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement entered into with the Stock Exchanges. A separate report of Corporate Governance is enclosed as a part of this Report along with certifi cate from M/s. Hemanshu Kapadia & Associates, Practicing Company Secretaries confi rming compliance with the requirements of Corporate Governance.

10. CEO/CFO CERTIFICATION:

In accordance with the provisions of the Listing Agreement pertaining to Corporate Governance norms, Mr. Ziaulla Sheriff, Chairman and Managing Director of the Company has certifi ed the review of fi nancial statements and establishing and maintaining internal controls for financial reporting for the year ended 31st March 2014. The said certifi cate forms part of the Annual Report.

11. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

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

12. AUDITORS:

M/s. SGCO & Co., Chartered Accountants, having Firm Registration No. 112081W, the Statutory Auditors of the Company retire at the conclusion of the ensuing Annual General Meeting and are eligible for reappointment. They have furnished a certifi cate to the effect that their proposed appointment, if made, will be in accordance with the limits specifi ed under Section 141 of the Companies Act, 2013.

The Board recommends re-appointment of Auditors of the Company for a term of three years commencing from 1st April 2014 to hold office as such from the conclusion of this Annual General Meeting ("AGM") until the conclusion of 22nd Annual General Meeting, subject to ratifi cation of the appointment by the members at every AGM held after this AGM.

13. AUDITORS'' REPORT:

The observations in the Auditors'' Report are dealt in the notes forming Part of the accounts at appropriate places. The management''s reply to the observations in the Annexure to the Auditors'' Report is given under:

Clause No.

Auditors'' Remarks Observations:

ix (a) Accordingly to the records of the Company, the undisputed statutory

dues including Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Customs Duty, Excise Duty and Cess, to the extent applicable to the Company have been regularly deposited with the appropriate authorities except for Service Tax liability and TDS liability where delays have been noticed and Provident Fund liability amounting to Rs. 652,672/- which is not yet paid as the Company has applied for registration under the said act. The undisputed amounts payable in respect of such statutory dues which have remained outstanding as at 31st March 2014 for a period more than six months from the date they became payable are as follows :

i. Provident Fund amounting to Rs. 313,978 - Applied for Registration

ii. TDS amounting to Rs. 39,351 - Since paid

iii Sen/ice Tax amnunfinn fn Rs 165 390 - Since naid

Management Reply :

There were delays in payment of taxes due to administrative diffi culties. The management had a contrary view in respect of the said payment.

(xvii) On an overall examination of the balance sheet of the Company, we are

of the opinion that short-term funds to the extent of Rs. 6,35,60,126/- have been used for long-term purpose. :

The management is in the process of planning augmenting the long term capital to overcome the current position

14. DIRECTORS'' RESPONSIBILITY STATEMENT:

Pursuant to the requirement under Section 217 (2AA) of the Companies Act, 1956 with respect to the Director''s Responsibility Statement, it is hereby confi rmed that:

(i) in the preparation of the annual accounts for the financial year ended 31st March 2013, the applicable accounting standards have been followed and that there are no material departures;

(ii) the Directors have adopted such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company as on 31st March 2014 and of the profit of the Company for the financial year end on that date;

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

(iv) the Directors have prepared the Annual Accounts on a going concern basis.

15. ACKNOWLEDGEMENT:

Your Directors take this opportunity to convey their appreciation to all the members, advertisers, bankers, regulatory bodies and other business associates for their continued support and confi dence in the management of the Company. Your Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers and staff, resulting in the successful performance of the Company during the year.

By Order of the Board Starcom Information Technology Limited

sd/- Place: Bangalore Ziaulla Sheriff Date: 8th November 2014 Chairman & Managing Director CIN: L67120MH1995PLC085704 DIN: 00002098 Add: Al-Barka Golden Enclave, Airport Road, Bangalore-560017

Registered office: #73, Sheriff Centre, St. Marks'' Road, Bangalore-560001


Mar 31, 2013

To The Members

The Directors are hereby presenting the Eighteenth Annual Report of your Company together with the audited statements of accounts for the year ended 31st March 2013.

(Amount in Rs.)

Financial Results For the year ended For the year ended 31st March 2013 31st March 2012

Income 25,529,741 4,407,740

Expenditure 39,050,054 1,043,339

Proft/(Loss) before Taxation (13,520,314) 3,364,401

Less: Provision for Taxation 104,198 749,046

Net Proft after taxation (13,416,115) 2,615,355 Proft/(Loss) brought forward from previous year 7,342,692 4,727,337

Balance carried forward to Balance Sheet (6,073,423) 7,342,692

OPERATIONS & PROSPECTS:

The operations of the Company have been commenced during the year under review. The discussions for strategic alliances are at an advanced stage with two companies from United States and Germany.

Your Company has different projects on hand which include Analytical Data Services, Multi-designing services, dealerships in electronic products and trading software programs used in educational services.

DIVIDEND:

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

DIRECTORS:

During the year under review, Mr. Laxminarayan Purohit, Director of the Company will retire by rotation at the ensuing Annual General Meeting and being eligible has offered himself for reappointment. The Board of Directors has received Forms DDA from all the Directors informing that they are not disqualifed under Section 274(1)(g) of the Companies Act, 1956.

The management has identifed the Independent Directors. They shall join the Board as soon as the operations commence on full fedge basis.

REGISTERED OFFICE AND SOFTWARE DEVELOPMENT CENTER:

The Company is in the process of shifting the registered offce of the Company from ''43, Great Western Bldg., (Opp. Lion Gate), N. M. Street Extn, Fort, Mumbai- 400023'' to ''# 73, Sheriff Centre, St. Mark''s Road, Bangalore – 560 001, Karnataka''. The Company has obtained Members approval via Postal Ballot.

Further, the Company is in process of fling the petition with the Regional Director Mumbai for obtaining the approval forthe proposed shifting of the Registered offce.

CHANGE IN REGISTRAR AND TRANSFER AGENT (R&TA):

During the year under review M/s Sharex Dynamic (India) Pvt. Ltd have been appointed as the Registrar and Share Transfer Agent of the Company after complying with the requisite formalities.

Accordingly, Register and Index of Members, copies of Annual Return prepared under Section 159 and 161 of the Act together with the copies of the certifcates and documents required to be annexed thereto have been kept with Sharex Dynamic (India) Pvt. Ltd. at Unit-1, Luthra Ind. Premises, Andheri-Kurla Rd., Safed Pool, Andheri (E), Mumbai 400 072.

FIXED DEPOSITS:

The Company has not accepted any fxed deposits from the public during the year under review.

PARTICULARS OF EMPLOYEES:

Pursuant to Section 217(2A) of the Companies Act, 1956, the Directors have to inform that there was no such employee covered under the Section.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO:

The information as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in Report of the Board of Directors) Rules, 1988 with respect to conservation of energy, technology absorption and foreign exchange earnings is given below:

A. Conservation of Energy:

The Company is not covered under the list of specifed industries. However the Company on continuous basis takes measures for conservation of power.

B. Technology Absorption, Adaptation and innovation:

There was no technology absorption, adaptation and innovation during the year.

CORPORATE GOVERNANCE:

Your Company adheres to the requirements set out by the Securities and Exchange Board of India. A separate section of Corporate Governance along with certifcate from Practicing Company Secretary regarding compliance as stipulated under clause 49 of the Listing Agreement forms part of the Annual Report.

CEO/CFO CERTIFICATION:

In accordance with the provisions of the Listing Agreement pertaining to Corporate Governance norms, Mr. Ziaulla Sheriff, Chairman and Managing Director has certifed the review of fnancial statements and establishing and maintaining internal controls for fnancial reporting for the year ended 31st March 2013. The said certifcate forms part of the Annual Report.

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 separate section forming part of the Annual Report.

AUDITORS:

M/s. Singrodia Goyal & Co., Chartered Accountants, Statutory Auditors of the Company retire at the conclusion of the ensuing Annual General Meeting and are eligible for reappointment. They have furnished a certifcate to the effect that their proposed appointment, if made, will be in accordance with the limits specifed under Section 224(1B) of the Companies Act, 1956. Members are requested to consider their re-appointment as Auditors for the fnancial year ending 31st March 2014 at remuneration to be decided by your Board of Directors or any Committee thereof.

AUDITORS'' REPORT:

There are no qualifcations contained in the Auditors'' Report and therefore there are no further explanations to be provided for in this regard.

DIRECTORS'' RESPONSIBILITY STATEMENT:

Pursuant to the requirement under Section 217 (2AA) of the Companies Act, 1956 with respect to the Director''s Responsibility Statement, it is hereby confrmed that:

(i) in the preparation of the annual accounts for the fnancial year ended 31st March 2013, the applicable accounting standards have been followed along with proper explanation relating to material departures except accounts drawn as per Revised Schedule VI of the Companies Act, 1956;

(ii) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company as on 31st March 2013 and of the proft of the Company for that period;

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

(iv) the Directors have prepared the Annual Accounts on a going concern basis.

ACKNOWLEDGEMENT:

Your Directors take this opportunity to convey their appreciation to all the members, advertisers, bankers, regulatory bodies and other business associates for their continued support and confdence in the management of the Company. Your Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, offcers and staff, resulting in the successful performance of the Company during the year.

For and on behalf of the Board of Directors

Starcom Information Technology Limited

Ziaulla Sheriff Chairman & Managing Director

Bangalore, 29th October 2013

Regd. Offce:

43, Great Western Bldg.,

(Opp. Lion Gate) N. M. Street

Extn, Fort,Mumbai- 400023


Mar 31, 2012

The Directors have pleasure in presenting the Seventeenth Annual Report of your Company together with the audited statements of accounts for the year ended 31st March 2012.

(in Rs.)

Financial Results For the year ended For the year ended 31st March 2012 31st March 2011

Income 4'407'740 4'006'842

Expenditure 1'043'339 1'145'754

Profit/(Loss) before Taxation 3'364'401 2'861'088

Less: Provision for Taxation 749'046 516'102

Net Profit after taxation 2'615'355 2'344'986



OPERATIONS & PROSPECTS:

The operations of the Company have not been commenced. After taking over the Company' the new management is in talks with various companies and exploring the opportunities for joint venture and collaborations. The discussions for strategic alliances are at an advanced stage with two companies from United States and Germany. Your management is hopeful that the discussions will materialize and the operations of the Company will begin full fledge in the current financial year.

DIVIDEND:

In view of setting up new business opportunities and to conserve resources for future growth of the Company' your Directors do not recommend any dividend for the year under review.

CHANGE IN MANAGEMENT CONTROL:

Post the Letter of Offer dated May 30'2011 (“LOO”) and Corrigendum to PA which appeared on June 03'2011 (“CPA”)' pursuant to Regulations 10 & 12 of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations' 1997 and subsequent amendments thereof' to acquire up to 10'00'120 fully paid equity/ voting share capital representing 20% of the equity/ voting share capital of the Target Company at a price of Rs. 20.50 per fully paid equity share of Rs. 10/-each' payable in cash (“Offer”). However the actual acquisition was of 8'76'175 Equity Shares through open offer in addition to the 3'56'0280 equity shares already acquired through open offer made in February 2011. The Total shareholding holding of the promoter after post offer is 44'36'455 Equity Shares' Rs.10/- each fully paid up' representing 88.72% voting capital of the Company.

DIRECTORS:

During the year under review' Mr. Ziaulla Sheriff' Promoter of the Company' Mr. Mohan Kumar Maddur Gundurao and Mr. Laxminarayan Krishnacharya Purohit were appointed as Additional Directors of the Company w.e.f. 12th August 2011. Subsequently in the previous Annual General Meeting held on 2nd November 2011' the members appointed Mr. Ziaulla Sheriff' Promoter of the Company' Mr. Mohan Kumar Maddur Gundurao and Mr. Laxminarayan Krishnacharya Purohit as Directors of the Company. Mr. Ziaulla Sheriff has been appointed as the Chairman and Managing Director of the Company w.e.f. 12lh August 2011 for a period of 5 years.

Mr. Yogesh Singhania and Mr. Pramod Kumar Sanganeria have resigned as Directors w.e.f. 12th August 2011 and Mr. Mahesh Saraf has resigned as Director w.e.f. 19th August 2011.

Mr. Mohankumar Gundurao' Director of the Company' is liable to retire by rotation at the forthcoming Annual General Meeting and being eligible offers himself for reappointment. The resolution for his reappointment as Director is recommended for shareholders approval.

The Board of Directors has received Forms DDA from all the Directors informing that they are not disqualified under Section 274(1 )(g) of the Companies Act' 1956.

The management has identified the Independent Directors. They shall join the Board as soon as the operations commence.

REGISTERED OFFICE AND SOFTWARE DEVELOPMENT CENTER:

During the year under review' the registered office of the Company was shifted from “315' Corporate Avenue' Stonewall Road' Goregaon (E)' Mumbai- 400063” to “43' Great Western Bldg.' (Opp. Lion Gate)' N. M. Street Extn' Fort' Mumbai- 400023" in view of change in management.

In view of the future business opportunities available in the city of Bengaluru' the management has acquired office premises on long lease basis. The new office premises is spread over 12000 sq. ft. and has the capacity of accommodating over 150 software developers and administrative staff. The estimated total capital outlay for furnishing the office will be Rs.2.5 crores.

FIXED DEPOSITS:

The Company has not accepted any fixed deposits from the public during the year under review.

PARTICULARS OF EMPLOYEES:

Pursuant to Section 217(2A) of the Companies Act' 1956' the Directors have to inform that there was no such employee covered under the section.

CONSERVATION OF ENERGY' TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO:

The information as required under section 217(1 )(e) of the Companies Act' 1956' read with the Companies (Disclosure of Particulars in Report of the Board of Directors) Rules' 1988 with respect to conservation of energy' technology absorption and foreign exchange earnings is given below:

A. Conservation of Energy:

The Company is not covered under the list of specified industries' however the Company on continuous basis takes measures for conservation of power.

B. Technology Absorption' Adaptation and innovation:

There was no technology absorption' adaptation and innovation during the year.

C. Foreign Exchange Earnings and Outgoings:

Foreign Exchange Earning: NIL

Foreign Exchange Outgoings: NIL CORPORATE GOVERNANCE:

Your Company adheres to the requirements set out by the Securities and Exchange Board of India. A separate section of Corporate Governance along with certificate from Practicing Company Secretary confirming compliance as stipulated under clause 49 of the Listing Agreement forms part of the Annual Report.

CEO/CFO CERTIFICATION:

In accordance with the provisions of the Listing Agreement pertaining to Corporate Governance norms' Mr. Ziaulla Sheriff' Chairman and Managing Director has certified the review of financial statements and establishing and maintaining internal controls for financial reporting for the year ended 31s1 March 2012. The said certificate forms part of the Annual Report.

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 separate section forming part of the Annual Report.

AUDITORS:

M/s Singrodia Goyal & Co.' Chartered Accountants' Statutory Auditors of the Company retire at the conclusion of the ensuing Annual General Meeting and are eligible for reappointment. They have furnished a certificate to the effect that their proposed appointment' if made' will be in accordance with the limits specified under section 224(1 B) of the Companies Act' 1956. Members are requested to consider their re-appointment as Auditors for the financial year ending 31st March 2013 at remuneration to be decided by your Board of Directors or any Committee thereof.

AUDITORS’ REPORT:

There are no qualifications contained in the Auditors’ Report and therefore there are no further explanations to be provided for in this regard.

DIRECTORS’ RESPONSIBILITY STATEMENT:

(i) Pursuant to the requirement under Section 217 (2AA) of the Companies Act' 1956 with respect to the Director’s Responsibility Statement' it is hereby confirmed that:in the preparation of the annual accounts for the financial year ' ended 31st March 2012' the applicable accounting standards have been followed along with proper explanation relating to material departures except accounts drawn as per Revised Schedule VI of the Companies Act' 1956;

(ii) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent' so as to give a true and fair view of the state of affairs of the Company as on 31st March 2012 and of the profit of the Company for that period;

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

(iv) the Directors have prepared the Annual Accounts on a going concern basis.

ACKNOWLEDGEMENT:

Your Directors would like to express their sincere appreciation for the co-operation and assistance received from shareholders' bankers' regulatory bodies and other business constituents during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives' officers and staff' resulting in the successful performance of the Company during the year.

For and on behalf of the Board of Directors Starcom Information Technology Limited



Ziaulla Sheriff Chairman & Managing Director

Bangalore' 21st August 2012

Regd. Office:

43' Great Western Bldg.' (Opp. Lion Gate) N. M. Street Extn' Fort' Mumbai- 400023


Mar 31, 2010

The Directors have pleasure in presenting the Fifteenth Annual Report of your Company together with the Audited Statements of Accounts for the year ended 31st March 2010.

(In Rs.)

Financial Results For the year ended For the year ended 31st March, 2010 31st March, 2009

Income 15,776,503 8,780,438

Expenditure 13,183,721 9,646,180

Profit/(Loss) before Taxation 2,592,782 (865,743)

Less: Provision for Taxation 791,540 2,876

Net Profit after taxation 1,801,242 (868,619)

Profit/(Loss) brought forward from previous year 581,109 1,449,728

Balance carried forward to Balance Sheet 2,382,351 581,109



OPERATIONS & PROSPECTS:

Total income for the year under review was Rs.15,776,503/- as compared to Rs.8,780,438/- in the previous year. This year Company has incurred profit of Rs.2,592,782- as compared to loss of Rs.868,619/- previous year registering a growth of 307.37%.

Your Directors assure to strive for a brighter future for your Company.

DIVIDEND:

Your Directors wish to conserve resources for future expansion and growth of the Company and hence do not recommend any dividend for the year under review.

DIRECTORS:

In terms of the provisions of the Companies Act, 1956, Mr. Pramod Kumar Sanganeria, Director of the Company retires by rotation and being eligible offers himself for re-appointment at the ensuing Annual General Meeting. Your Directors recommend his re-appointment as Director.

The particulars of Mr. Pramod Sanganeria as required under clause 49 of the Listing Agreement are given in the Annexure to the notice and corporate governance section of this Annual Report.

FIXED DEPOSITS:

The Company has not accepted any fixed deposits from the public during the year under review.

PARTICULARS OF EMPLOYEES:

Pursuant to Section 217(2A) of the Companies Act, 1956, the Directors have to inform that there was no such employee as mentioned in the section.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO:

Since your Company does not own any manufacturing facility, the particulars relating to conservation of energy and technology absorption stipulated in the Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988, are not applicable.

There were no foreign exchange earnings and outgo during the year.

CORPORATE GOVERNANCE:

Your Company adheres to the requirements set out by the Securities and Exchange Board of India. A separate section of Corporate Governance along with certificate from Practicing Company Secretary confirming compliance as stipulated under clause 49 of the Listing Agreement forms part of the Annual Report.

CEO/CFO CERTIFICATION:

In accordance with the provisions of the Listing Agreement pertaining to Corporate Governance norms, Mr. Mahesh Saraf, Managing Director has certified about review of financial statements and establishing and maintaining internal controls for financial reporting for the year ended 31st March 2010. The said certificate forms part of the Annual Report.

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 separate section forming part of the Annual Report.

AUDITORS:

M/s Singrodia Goyal & Co., Chartered Accountants, Statutory Auditors of the Company will retire on conclusion of the ensuing Annual General Meeting and are eligible for reappointment. They have furnished a certificate to the effect that their proposed appointment, if made, will be in accordance with the limits specified under section 224(1 B) of the Companies Act, 1956. Members are requested to consider their re-appointment as Auditors for the financial year ending 31st March 2011 at remuneration to be decided by your Board of Directors or any Committee thereof.

SUBSIDIARY COMPANY:

During the financial year 2010-11, the Company has acquired 10,000 Equity Share of nominal value of Rs 32,000/- (100%) controlling stake of Alisha Realities Private Limited. Accordingly Alisha Realities Private Limited has become 100% subsidiary of your Company.

DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to the requirement under Section 217 (2AA) of the Companies Act, 1956 with respect to the Directors Responsibilities Statement, it is hereby confirmed that:

(i) in the preparation of the annual accounts for the financial year ended 31st March 2010, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(ii) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent, so as to give a true and fair view of the sate of affairs of the Company as on 31st March 2010 and of the profit of the Company for that period;

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

(iv) the Directors have prepared the Annual Accounts on a going concern basis.

ACKNOWLEDGEMENT:

Your Directors would like to express their sincere appreciation of the co-operation and assistance received from shareholders, bankers, regulatory bodies and other business constituents during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers and staff, resulting in the successful performance of the Company during the year.

For and on behalf of the Board of Directors

Starcom Information Technology Limited

Mahesh Saraf

Mumbai, 23rd August, 2010 Chairman & Managing Director

Regd. Office:

315, Corporate Avenue, Sonawala Road, Goregaon (East), Mumbai - 400063.

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