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Directors Report of Benares Hotels Ltd.

Mar 31, 2018

BOARDâS REPORT TO THE MEMBERS

The Directors hereby present the Forty Seventh Annual Report of the Company together with the Financial Statement (Audited Statements of Account) for the year ended 31stMarch, 2018.

OPERATING AND FINANCIAL RESULTS

	(Rs. Lakhs)	(Rs. Lakhs)
	2017-18	2016-17
Income .......................................................................................	... 4827.52	5113.62
Gross Profit for the year ...............................................................	... 1214.49	1538.19
Less: Depreciation ......................................................................	... 417.31	464.85
Less: Interest................................................................................	... 12.32	-
Profit before tax ...........................................................................	... 784.85	1073.34
Less: Provision for Tax:
- Current Tax ........................................................................	... 301.30	491.77
- Deferred Tax ......................................................................	... (157.00)	(100.12)
- Provision oftax ofearlier years ( Net ) .................................	... (7.74)	-
Profits after Taxes ........................................................................	... 648.29	681.69
Add: Other Comprehensive Income (Net of Taxes)	1.07	(16.61)
Total Comprehensive Income	649.36	665.08
Add: Balance brought forward from previous year	3818.17	3466.03
Balance available for appropriations	4467.54	4131.11
Less: Dividend Paid	195.00	260.00
Less: Tax on Dividend	39.70	52.93
Less: Amount transferred to General Reserve	-	-
Balance Carried forward	4232.84	3818.17

OPERATIONS

During the year, the Revenue from Operations dropped by 4.3% as compared to previous year as 55 rooms at The Gateway Hotel, Varanasi were not available due to renovation for part of the year. F&B revenues were almost at par with previous year, though the room revenues decreased by 6% as compared with previous year.

While Nadesar Palace has improved its performance, owing to decrease in Room revenue at The Gateway Hotel, Varanasi and the margins coming under pressure in The Gateway Hotel, Gondia coupled with the drop in Interest income on account of utilization of funds for the renovation projects of Rooms and construction of new banquet hall, the Gross Operating Profit (EBIDTA) for the year was at Rs.1214.49 Lakhs as against Rs. 1538.19 Lakhs in the previous year.

Accelerated depreciation amounting to Rs. 118.90 Lakhs (PYRs. 187.04 Lakhs) in accordance with provisions of schedule II of the Companies Act, 2013 have been charged during the year. Consequently, the profit before tax was at Rs. 784.85 Lakhs, i.e. 26.88% lower than previous year.

A new banquet hall at The Gateway Hotel, Varanasi has been commissioned and renovation of 55 rooms has also been completed which would help the Company to improve its performance in the coming years.

DIVIDEND

Keeping in view of the performance of the Company, your Directors recommend the payment of dividend @ 150% (previous year dividend @ 150%) per equity share involving distribution of Rs. 195 Lakhs.

PARTICULARS OF EMPLOYEES

The Company had no employees during the year who were in receipt of remuneration aggregating to:

(a) Not less than Rs. 102.00 Lakhs for the year, if employed throughout the financial year, or

(b) Not less than Rs. 8.50 Lakhs per month, if employed for part of the financial year.

DIRECTORS

During the year under report, the office of Mr. B.L. Passi, Director fell vacant w.e.f. July 21, 2017, pursuant to Section 167 of the Companies Act, 2013 and Mr. Rakesh Sarna, Director resigned from the Directorship of the Company w.e.f. September 30, 2017. The Directors place on record their appreciation of the services rendered by Mr. Passi and Mr. Sarna during their tenure as Director ofthe Company.

In accordance with Section 149 of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015 (SEBI Listing Regulation), Mr. Giridhar Sanjeevi (DIN-06648008) and Mr. Puneet Chhatwal (DIN-07624616) were appointed as Additional Directors of the Company with effect from January 25, 2018 and May 10, 2018 respectively on the recommendation of the Nomination & Remuneration Committee. Mr. Sanjeevi has since resigned as a Director w.e.f. May 16, 2018 from the Directorship of the Company In terms of Section 161 of the Companies Act, 2013 and Article 122 of the Articles of Association of the Company, Mr. Puneet Chhatwal holds office up to the date of the Annual General Meeting of the Company It is proposed to appoint Mr. Chhatwal as a Director of the Company at the ensuing Annual General Meeting. The Board of Directors commends the appointment of Mr. Chhatwal as a Director of the Company.

In accordance with the Companies Act, 2013 and the Articles of Association of the Company, Dr. Anant Narain Singh (DIN 00114728) Director of the Company is liable to retire by rotation and being eligible seeks reappointment.

KEY MANAGERIAL PERSONNEL

During the year under report, Mr. Ravi Sharma, Chief Financial Officer (CFO) resigned w.e.f.July 16, 2017. He was replaced by Mr. Sopan Kedia as CFO of the Company w.e.f. July 24, 2017. Mr. Ashwani Anand, Chief Executive Officer (CEO) resigned w.e.f. May 3, 2018. He was replaced by Mr. Vijay Partap Shrikent as CEO of the Company w.e.f. May 10,2018.

In terms of Section 203 of Companies Act, 2013, your Company has Mr. Vijay Partap Shrikent as the Chief Executive Officer (CEO), Mr. Sopan Kedia as the Chief Financial Officer (CFO) and Ms. Vanika Mahajan as the Company Secretary of the Company, as the Key Managerial Personnel ofthe Company.

INFORMATION PURSUANT TO RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014

The information pursuant to Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given in Annexure 1.

SUBSIDIARY COMPANIES

The Company does not have any subsidiary company

HOLDING COMPANY

The Indian Hotels Company Limited (IHCL) is the Ultimate Holding Company of the Company

NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR

The Company held 4 (four) Board Meetings during the financial year under report.

AUDIT COMMITTEE AND VIGIL MECHANISM

In terms of Section 177 of the Companies Act, 2013, your Company has an Audit Committee with Mr. Shriraman, Mr. Moiz Miyajiwala, Mrs. Rukmani Devi and Mr. Rohit Khosla as its members. During the year under report, Mr. B.L. Passi and Mr. Giridhar Sanjeevi ceased to be the members of the Audit Committee consequent to the vacation of office and resignation from the Directorship of the Company respectively.

Your Company has a policy on Vigil Mechanism/ Whistle blower Policy to provide a formal mechanism for the Directors and employees to report genuine concerns about any unethical behaviour, actual or suspected fraud or violation of your Companyâs Code of Conduct or ethics policy. The policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provide for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel has been denied access to the Chairman of the Audit Committee. The provisions of the policy are in line with the provisions of Section 177(9) of the Act and Regulation 22 of the SEBI listing Regulations. The Whistle Blower Policy can be accessed on your Companyâs website: https://www.benareshotels limited.com/content/dam/thrp/benareshotelslimited/ documents/policies/Whistle_Blower.pdf

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

In terms of Section 135 of the Companies Act, 2013 (the Act), your Company has the Corporate Social Responsibility Committee (CSR) Committee of the Board with Dr. Anant Narain Singh, Mrs. Rukmani Devi and Mr. Rohit Khosla as the members of the Committee. The brief outline of the CSR Policy of your Company and the initiatives undertaken by your Company on CSR activities during the year are set out in âAnnexure 2'''' of this Report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. The policy is available on the website of your Company: https://www.benareshotelslimited.com/content/dam /thrp/benareshotelslimited/documents/policies/CSR %20POLICY.pdf.

NOMINATION AND REMUNERATION COMMITTEE

In terms of Section 178(1) of the Companies Act, 2013 (the Act), the Company has a Nomination and Remuneration Committee (NRC) of the Board with Dr. Anant Narain Singh, Mrs. Rukmani Devi and Mr. Shriraman as the members of the Committee. Mr. Giridhar Sanjeevi ceased to be a member of the Nomination & Remuneration Committee consequent to the resignation from the Directorship of the Company. The Committee met four times during the year on 8th May, 2017, 24th July, 2017, 25 th January, 2018 and 28 th March, 2018.

In terms of the requirement of section 178(3) and SEBI Listing Regulations, the Company has a policy relating to the remuneration for the directors, KMPs and other employees. The key features of the said policy are:

- Overall remuneration (sitting fees and Commission) should be reasonable and sufficient to attract, retain and motivate directors aligned to the requirements of the Company;

- Overall remuneration practices should be consistent with recognized best practices

- Within the parameters prescribed under the law, the payment of sitting fees and commission will be recommended by NRC and approved by the Board.

- The aggregate commission payable to the Directors will be recommended by NRC to the Board based on company performance, profits, return to investors, shareholder value creation and any other significant qualitative parameters as may be decided by the Board.

- The quantum ofcommission for each director shall be recommended by NRC to the Board based upon the outcome of the evaluation process drive by various factors including attendance and time spent in the Board and committee meetings, individual contributions at the meetings and contributions made by the Directors other than in meetings.

INTERNAL COMPLAINTS COMMITTEE

The Company has an ''Internal Complaints Committee'' under The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 for the prevention and redressal of complaints of sexual harassment and for the matters concerned, connected or incidental thereto. No case was reported during the year under review.

DECLARATION BY INDEPENDENT DIRECTORS

In terms of Section 149(7) of the Companies Act, 2013 (the Act), the Independent Directors have given a declaration that they meet the criteria of independence as per Section 149(6) of the Act.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

In addition to the Corporate Governance Guidelines discussed and adopted by the Board which, inter alia, included the role, rights and responsibilities of independent directors, the Company has an appropriate ongoing familiarization programme, with respect to the roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company etc. The details of the familiarization programme are disclosed on the Companyâs website: https: //www. benareshotelslimited. com/content/dam /thrp/benareshotelslimited/documents/policies/Fami liarization%20Programme%20-%20BHL.pdf

LOANS, GUARANTEES AND INVESTMENTS MADE UNDER SECTION 186

The Company has not given any loans or guarantees nor has made any investments under Section 186 of the Act during the year under review.

BORROWING

During the year under report, the Company has borrowed a sum of Rs. 500.00 Lakhs as a short term Inter Corporate Deposit from a body corporate.

SECRETARIALAUDIT REPORT

In terms of Section 204(1) of the Companies Act, 2013, M/s A K Bhayana & Associates, Company Secretaries, were appointed by the Company as the Secretarial Auditor. The secretarial audit report as obtained from them is attached to this Report as Annexure 3. The report does not contain any qualifications, reservation or adverse remarks.

ANNUAL RETURN

The extract of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules 2014 is furnished in Annexure 4 to this Report.

CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All related party transactions that were entered into during the financial year under report were at arm''s length basis and in the ordinary course of business.

The Company has developed a Related Party Transactions Framework under the Policy on Related Party Transactions, which policy is also available at Companyâs website: https://www.benareshotels limited.com/content/dam/thrp/benareshotelslimited/ documents/policies/RPT.pdf, for the purpose of identification and monitoring of such transactions. Prior omnibus approval of the Board is obtained for transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted and a statement giving details of all the related party transactions is placed before the Audit Committee for its approval on a quarterly basis.

Other than transactions entered into in the normal course ofbusiness, the Company has not entered into any materially significant related party transactions during the year, which could have a potential conflict of interest between the company and its promoters, Directors, Management and/or relatives save and except that the transaction with The Indian Hotels Co. Ltd., the ultimate holding company during the year exceeded 10% of the annual gross turnover of the Company for the previous year, the approval for which was taken from the shareholders by way of a special resolution at the AGM held on August 21, 2015.

CORPORATE GOVERNANCE

As required by SEBI Listing Regulations, the report for the year 2017-18 on Management Discussion and Analysis, Corporate Governance as well as the Auditors'' Certificate regarding compliance of conditions of Corporate Governance, forms part of the Annual Report.

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

RISK MANAGEMENT POLICY

Your Company has a Risk Management Policy, pursuant to the provisions of Section 134 of the Act, to identify and evaluate business risks and opportunities for mitigation of the same on a continual basis. This framework seeks to create transparency, minimize adverse impact on business objective and enhance your Company''s competitive advantage. The risk management framework defines the risk management approach across the enterprise at various levels including documentation and reporting.

The framework enables risks to be appropriately rated and graded in accordance with their potential impact and likelihood. The two key components of risks are the probability (likelihood) of occurrence and the impact (consequence) of occurrence, if the risk occurs. Risk is analyzed by combining estimates of probability and impact in the context of existing control measures.

Existing control measures are evaluated against Critical Success Factors (CSFs) and Key Performance Indicators (KPIs) identified for those specific controls. Guiding principles to determine the risk consequence (impact), probability of occurrence (likelihood factor) and mitigation plan effectiveness have been set out in Risk Register.

The Key business risks identified by the Company and its mitigation plans are as under:

Strategy Risks: Risk of erosion of market dominance by losing market share, which originates from the choices we make on markets, resources and delivery models that can potentially impact our competitive advantage in the medium and long term. Loss of F&B attractiveness on account of pricing/ design/ competition.

Industry and Economic Risks: High dependence on US, Europe and East Asian markets for foreign tourists arrival. The economic situation in these parts of the world has a potential impact on the entire tourism industry. Risks arising from the development in the regulatory environment that could impact the Hotel/Tourism Industry. Risks due to geographic concentration of business, primarily in the city of Varanasi.

Operational Risks: High dependence on several technology platforms & systems to operate business both Internal & External. Cost overruns/delays in completion of projects. Loss of critical/sensitive data due to leakage/loss/hacking. Increase in fixed cost elements beyond entity control. Highly litigious nature of the industry/adverse consequences of litigation against the Company. non-renewal of key licenses and NOCs.

Safety and Security Risks: Risks arising from factors such as Fire, Accidents, Electricity mishaps, etc. Business interruption on account of natural calamities/ act of God/riots & strikes/political instability and terrorism.

Resources: Risks arising from sub-optimal succession planning and retention of talent pool. Inappropriate utilization of financial capital, talent and infrastructure.

KEY RISK MANAGEMENT PRACTICES

Risk Identification and Impact Assessment: Risk assessment enables risks to be appropriately rated and graded in accordance with their potential impact and likelihood. The two key components of risks are the probability (likelihood) of occurrence and the impact (consequence) if the risk occurs. Risk is analyzed by combining estimates of probability and impact in the context of existing control measures and included in the risk register. Apart from risk register, internal audit findings also provide input for risk identification and assessment, which is carried out on an annual basis across all functions.

Operational risks are assessed primarily on three dimensions, namely strength of underlying controls, compliance to policies and business procedure effectiveness.

Risk reporting and Disclosure: Risks to the achievement of key business objectives, trend line of risk level, impact and mitigation actions are reported risk level, impact and mitigation action are reported and discussed. The escalation ofrisk information is timely, accurate and gives complete coverage of the key risks to support management decision making at all levels.

Risk Mitigation and Monitoring: Each Manager creates a risk mitigation plan by employing an effective system of internal controls & checks and balances to mitigate the risks in the most effective manner, including designating responsibilities and providing for upward and onward communication of any significant issues that may merit attention or escalation. All employees actively engage in risk management within their own areas ofresponsibility.

Integration with Strategy and Business Planning:

Identified risks to the business objectives in the near term, medium term and long term are used as one of the key inputs for the development of strategy and annual business plan. Key strategic initiatives are identified to mitigate specific risk.

STAUTORY AUDITORS

PKF Sridhar & Santhanam LLP, Chartered Accountants (Registration No. 003990S/ S200018) the Statutory Auditors of the Company hold office till the conclusion of the ensuing Annual General Meeting. The report of the Statutory Auditors along with the Notes to Schedules is enclosed to this Report and does not contain any qualifications, reservations or adverse remark or disclaimer.

The Board has recommended the appointment of PKF Sridhar & Santhanam LLP, Chartered Accountants (Registration No. 003990S/S200018), as the Statutory Auditors of the Company, for a term of five consecutive years, from the conclusion of this AGM till the conclusion of the 52nd AGM of the Company to be held in the year 2023, for approval of the Members.

CONSERVATION OF ENERGY

The Company has always been conscious of the need for conservation of energy and has been sensitive in making progress towards this end. The Company has implemented following energy conservation initiatives at the hotel:

- Replacement of old chiller plants with energy saving advance chiller plants including pumps & cooling towers.

- Replacement of cold rooms in kitchen, which are energy efficient.

- Installation of FCU and LED lights in renovated rooms with higher efficiency.

- Installation of LED lights in back office area in place of CFL.

TECHNOLOGYABSORPTION

The activities of the Company do not involve the absorption of technology as envisaged to be furnished pursuant to The Companies (Accounts) Rules, 2014.

FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of the provisions of Section 134(3)(f)(m) of the Companies Act, 2013, read with Rule 8(3)(C) of The Companies (Accounts) Rules, 2014, the foreign exchange earned in terms of actual inflows during the year and the foreign exchange outgo during the year in terms of actual outflows is furnished below:-a) Value of Imports

	31st March	31st March
	2018	2017
	Rs. Lakhs	Rs. Lakhs
Stores, Supplies and Spare Parts	8.04	6.39
for Machinery

Value of Imports	240.07	35.92
(CIF) Capital Imports
b) Expenditure in Foreign Currency
Professional and Consultancy Fees	11.73	16.24
Other Expenditure in Foreign Currency	22.48	48.98
c) Earnings in Foreign Currency
Earnings in Foreign Exchange	726.57	999.27

DIRECTORS'' EVALUATION

The Board of Directors has made the annual evaluation of its own performance and that of its committees and individual directors based on the review conducted by the Nomination & Remuneration Committee by assessing the questionnaires furnished by the directors/members of various committees in respect of their self-assessment as well as the assessment of the Board/Committees followed by the discussions with the directors/ members of the Committees.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Your Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is well defined in the organization. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control systems 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 function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions suggested are presented to the Audit Committee ofthe Board.

DIRECTORSâ RESPONSIBILITY STATEMENT

Based on the framework of internal financial control and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditors including audit of internal financial controls over financial reporting by the statutory auditor and the reviews performed by the Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Company''s internal financial controls were adequate and effective during the financial year 2017-18.

Accordingly, pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors to the best oftheir knowledge and ability, confirms that:

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

b). The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2018 and of the profit of the Company for that period;

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

d). The Directors have prepared the annual accounts on a going concern basis;

e). The Directors have laid down internal financial controls to be followed by Company and that such internal financial controls are adequate and were operating effectively; and

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

ACKNOWLEDGEMENTS

The Board desires to place on record its appreciation of the services rendered by the employees of the Company during the year under review.

On behalf of the Board of Directors

Dr. Anant Narain Singh

Chairman

Place : New Delhi

Date : 25th May, 2018

Mar 31, 2017

The Directors hereby present the Forty Sixth Annual Report of the Company together with the Financial Statement (Audited Statements of Account) for the year ended 31stMarch, 2017.

OPERATING AND FINANCIAL RESULTS

	(Rs. Lakh)	(Rs. Lakh)
	2016-17	2015-16
Income ........................................................................................	... 5113.62	5122.88
Gross Profit for the year ................................................................	.. 1538.19	1582.40
Less: Depreciation .......................................................................	... 464.85	266.45
Less: Interest ...............................................................................	... -	-
Profit before tax ............................................................................	.. 1073.34	1315.95
Less: Provision for tax:
- Current Tax ........................................................................	.. 491.77	199.33
- Deferred Tax.......................................................................	.. (100.12)	268.74
Profit after Taxes ..........................................................................	.. 681.69	847.88
Add: Other Comprehensive Income (Net of Taxes).........................	.. (16.61)	(4.34)
Total Comprehensive Income........................................................	.. 665.08	843.54
Add: Balance brought forward from previous year ..........................	.. 3466.03	2935.41
Balance available for appropriations ..............................................	.. 4131.11	3778.95
Less: Dividend paid.....................................................................	... 260.00	260.00
Less: Tax on Dividend ..................................................................	... 52.93	52.93
Less: Amount transferred to General Reserve ................................	... -	-
Balance Carried forward............................................................	... 3818.17	3466.03

OPERATIONS

During the year, the Revenue from Operations dropped by1% as compared to previous year. While room revenues were almost at par with previous year, the F&B revenues decreased by 3% as compared with previous year.

Owing to decrease in F&B revenues and increase in operating expenses, the Gross Operating Profit (EBIDTA) for the year was at Rs. 1538 Lakh, i.e. 3% lower than the previous year.

The depreciation charge increased by Rs. 198 lakh primarily owing to accelerated depreciation charged on assets identified to have a shorter useful life, in accordance with provisions of Schedule II of the Companies Act, 2013.

Consequently, the profit before tax was at Rs. 1073 lakh, i.e. 18% lower than the previous year.

DIVIDEND

Keeping in view the performance of the Company, your Directors recommend the payment of dividend @150% (previous year dividend @200%) per equity share involving distribution of Rs. 195 lakh.

PARTICULARS OF EMPLOYEES

The Company had no employees during the year who were in receipt of remuneration aggregating to:

(a) Not less than Rs. 102.00 lakhs for the year, if employed throughout the financial year, or

(b) Not less than Rs. 8.50 lakhs per month, if employed for part of the financial year.

DIRECTORS

In accordance with Section 149 of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015 (SEBI Listing Regulations), Mr. Moiz Miyajiwala was appointed as Additional Director of the Company in the capacity of Independent Director effective January 24, 2017 and he holds office up to the date of the forthcoming Annual General Meeting and is further proposed to be appointed as Independent Director of the Company for a period of 5 years commencing from January 24,2017.

In accordance with the Companies Act, 2013 and the Articles of Association of the Company, Mr. Rohit Khosla, Director of the Company is liable to retire by rotation and being eligible seeks reappointment.

During the year under report, Mr. D. R. Kaarthikeyan, independent director resigned from the Directorship of the Company with effect from October 20, 2016. The Directors place on record their appreciation of the services rendered by Mr. Kaarthikeyan during his tenure as Director of the Company.

KEY MANAGERIAL PERSONNEL

In terms of Section 203 of Companies Act, 2013, your Company has Mr. Ashwani Anand as the Chief Executive Officer (CEO), Mr. Ravi Sharma as the Chief Financial Officer (CFO) and Ms. Vanika Mahajan as the Company Secretary of the Company, as the Key Managerial Personnel of the Company.

INFORMATION PURSUANT TO RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014

The information pursuant to Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given in Annexure 1.

SUBSIDIARY COMPANIES

The Company does not have any subsidiary company

HOLDING COMPANY

The Indian Hotels Company Limited (IHCL) is the Ultimate Holding Company of the Company

NUM BER OF BOARD M EETINGS CONDUCTED DURING THE YEAR

The Company had convened 4 (four) Board Meetings during the financial year under report.

AUDIT COMMITTEE AND VIGIL MECHANISM

In terms of Section 177 of the Companies Act, 2013, your Company has an Audit Committee with Mr. B.L. Passi, Mr. Shriraman, Mr. Rohit Khosla and Mrs. Rukmani Devi as its members.

Your Company has a Policy on vigil mechanism/ Whistleblower Policy to provide a mechanism for the Directors and employees to report actual or suspected fraud or violation of your Companyâs Code of Conduct. The provisions of this Policy are in line with the provisions of Section 177 (9) of the Act and Clause 22 of the SEBI Listing Regulations. The Whistle Blower Policy can be accessed on your Companyâs website www.benareshotelslimited.com.

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

In terms of Section 135 of the Companies Act, 2013 (the Act), your Company has the Corporate Social Responsibility Committee (CSR Committee) of the Board with Dr. Anant Narain Singh, Mrs. Rukmani Devi and Mr. Rohit Khosla as the members of the Committee. The brief outline of the Corporate Social Responsibility (CSR) Policy of your Company and the initiatives undertaken by your company on CSR activities during the year are set out in â Annexure 2â of this Report in the format prescribed in the Companies (Corporate Social Responsibilty Policy) Rules, 2014. The policy is available on the website of yourCompanywww.benareshotelslimited.com.

NOMINATION AND REMUNERATION COMMITTEE

In terms of Section 178(1) of the Companies Act,

2013 (the Act), the Company has a Nomination and

Remuneration Committee (NRC) of the Board with Dr. Anant Narain Singh, Mrs. Rukmani Devi and Mr. Shriraman as the members of the Committee. The Committee met four times during the year on 3rd May, 2016, 2nd July, 2016, 24th January, 2017 and 24th March, 2017.

In terms of the requirement of Section 178(3) and SEBI Listing Regulations, the Company has a policy relating to the remuneration for the directors, KMPs and other employees. The key features of the said policy are:

- Overall remuneration (sitting fees and Commission) should be reasonable and sufficient to attract, retain and motivate directors aligned to the requirements of the Company;

- Overall remuneration practices should be consistent with recognized best practices

- Within the parameters prescribed under the law, the payment of sitting fees and commission will be recommended by NRC and approved by the Board.

- The quantum of commission for each director shall be recommended by NRC to the Board based upon the outcome of the evaluation process drive by various factors including attendance and time spent in the Board and committee meetings, individual contributions at the meetings and contributions made by the Directors other than in meetings.

INTERNAL COMPLAINTS COMMITTEE

During the financial year 2016-17 the Company received one complaint from an industrial trainee at The Gateway Hotel Ganges - Varanasi, on sexual harassment. The Investigation for the same has been completed and accused employee has since resigned from the Company

DECLARATION BY INDEPENDENT DIRECTORS

In terms of Section 149(7) of the Companies Act, 2013 (the Act), the Independent Directors have given a declaration that they meet the criteria of independence as per Section 149(6) of the Act.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

In addition to the Corporate Governance Guidelines discussed and adopted by the Board which, inter alia, included the role, rights and responsibilities of independent directors, the Company has an appropriate ongoing familiarization programme, with respect to the roles, rights responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company, etc. The details of the familiarisation programme are disclosed on the Companyâs website under the weblink:www.benareshotelslimited.com.

LOANS, GUARANTEES AND INVESTMENTS MADE UNDER SECTION 186

During the year under report, the Company has placed/renewed a sum of Rs. 10.00 crores as short term Inter Corporate Deposits with bodies corporate within the limits prescribed under Section 186 of the Companies Act, 2013.

SECRETARIAL AUDIT REPORT

In terms of Section 204(1) of the Companies Act, 2013, M/s A K Bhayana & Associates, Company Secretaries, were appointed by the Company as the Secretarial Auditor. The secretarial audit report as obtained from them is attached to this Report as Annexure 3. The report is self-explanatory and does not call for any comments.

ANNUAL RETURN

The extract of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration ) Rules 2014 is furnished in Annexure 4 to this Report.

CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All related party transactions that were entered into during the financial year under report were at arm''s length basis and in the ordinary course of business.

The Company has developed a Related Party Transactions Framework under the Policy on Related Party Transactions, which policy is also available at Company''s website www.benareshotelslimited.com, for the purpose of identification and monitoring of such transactions. Prior omnibus approval of the Board is obtained for transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted and a statement giving details of all the related party transactions is placed before the Audit Committee for its approval on a quarterly basis.

Other than transactions entered into in the normal course of business, the Company has not entered into any materially significant related party transactions during the year, which could have a potential conflict of interest between the Company and its promoters, Directors, Management and/or relatives save and except that the transaction with The Indian Hotels Co. Ltd., the ultimate holding company during the year exceeded 10% of the annual gross turnover of the Company for the previous year, the approval for which was taken from the shareholders by way of a special resolution at the AGM held on August 21, 2015.

CORPORATE GOVERNANCE

As required by SEBI Listing Regulations, the report on Management Discussion and Analysis, Corporate Governance as well as the Auditorsâ Certificate regarding compliance of conditions of Corporate Governance, forms part of the Annual Report.

During the year under review, there were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and the Companyâs operations.

RISK MANAGEMENT POLICY

Pursuant to Section 134 of the Act, your Company has a Risk Management Policy, to identify and evaluate business risks and opportunities. This framework seeks to create transparency, minimize adverse impact on business objective and enhance the Company''s competitive advantage. The risk framework defines the risk management approach across the enterprise at various levels including documentation and reporting.

The Key business risks identified by the Company and its mitigation plans are as under:

Safety and Security Risks: Risks arising from factors such as fire, accidents, electricity mishaps, etc. Business interruption on account of natural calamities/ act of God/riots & strikes/political instability and terrorism.

Resources: Risks arising from sub-optimal succession planning and retention of talent pool. Inappropriate utilization of financial capital, talent and infrastructure.

KEY RISK MANAGEMENT PRACTICES

Operational risks are assessed primarily on three dimensions, namely strength of underlying controls, compliance to policies and business procedure effectiveness.

Risk reporting and Disclosure: Risks to the achievement of key business objectives, trend line of risk level, impact and mitigation actions are reported risk level, impact and mitigation action are reported and discussed. The escalation of risk information is timely, accurate and gives complete coverage of the key risks to support management decision making at all levels.

Risk Mitigation and Monitoring: Each manager creates a risk mitigation plan by employing an effective system of internal controls & checks and balances to mitigate the risks in the most effective manner, including designating responsibilities and providing for upward and onward communication of any significant issues that may merit attention or escalation. All employees actively engage in risk management within their own areas of responsibility.

Integration with Strategy and Business Planning:

STATUTORY AUDITORS

M/s N. Krishnaswamy & Company, Chartered Accountants (Firm Registration No. 001555S), the Statutory Auditors of the Company, hold office till the conclusion of the 46th AGM of the Company. The Board has recommended the appointment of PKF Sridhar and Santhanam, LLP, Chartered Accountants (Firm Registration No. 003990S/S200018), as the Statutory Auditors of the Company in their place, from the conclusion of this AGM till the conclusion of next AGM of the Company on such remuneration as shall be mutually agreed between the Board and Auditors.

The report of the Statutory Auditors along with the notes to Schedules is enclosed to this report and does not contain any qualification, reservation or adverse remark or disclaimer.

CONSERVATION OF ENERGY

- Continue to replace the CFL lights in various areas in the Hotels with energy efficient LED lights.

- Replacement of out of order electrical equipments with energy efficient equipments in a systematic manner.

- Conducted detailed energy audits through expert agency specializing in such audits and identified more areas where energy saving measures can be implemented in following years.

TECHNOLOGYABSORPTION

The activities of the Company do not involve the absorption of technology as envisaged to be furnished pursuant to The Companies (Accounts) Rules, 2014.

FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of the provisions of Section 134(3)(f)(m) of the Companies Act, 2013, read with Rule 8(3)(C) of The Companies (Accounts) Rules, 2014, the Foreign Exchange earned in terms of actual inflows during the year and the Foreign Exchange outgo during the year in terms of actual outflows is furnished in Notes on Accounts (Refer Note 29 to 31 in Notes to Financial Statements).

DIRECTORS EVALUATION

The Board of Directors has made the annual evaluation of its own performance and that of its Committees and individual directors based on the review conducted by the Nomination & Remuneration Committee by assessing the questionnaires furnished by the directors/members of various committees in respect of their self assessment as well as the assessment of the Board/Committees followed by the discussions with the directors/ members of the Committees.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

DIRECTORSâ RESPONSIBILITY STATEMENT

Based on the framework of internal financial control and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditors including audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by the Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Companyâs internal financial controls were adequate and effective during the financial year 2016-17.

Accordingly, pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors to the best of their knowledge and ability, confirm that:

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

b). The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2017 and of the profit of the Company for that period;

d). The Directors have prepared the annual accounts on a going concern basis;

e). The Directors have laid down internal financial controls to be followed by Company and that such internal financial controls are adequate and were operating effectively; and

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

ACKNOWLEDGEMENTS

The Board desires to place on record its appreciation of the services rendered by the employees of the Company during the year under review.

On behalf of the Board of Directors

Dr. Anant Narain Singh

Chairman

Place : Mumbai

Date : 8th May, 2017

Mar 31, 2016

BOARDâS REPORT TO THE MEMBERS

The Directors hereby present the Forty Fifth Annual Report of the Company together with the Financial Statement (Audited Statements of Account) for the year ended 31st March, 2016.

OPERATING AND FINANCIAL RESULTS


	(Rs. Lacs)	(Rs. Lacs)
	2015-16	2014-15
Income.	5100.20	4824.06
Gross Profit for the year.	1553.03	1693.01
Less: Depreciation	266.46	267.23
Less: Interest	-	-
Profit before tax.	1286.57	1425.78
Less: Provision for tax:
-Current Tax	336.40	445.84
-Deferred Tax.	538.18	57.77
- Minimum Alternate Tax credit.	(269.44)	-
- Earlier years Taxes	(147.13)	(0.45)
Net Profit	828.56	922.62
Add: Balance brought forward from previous year	2622.49	2012.80
Balance available for appropriations	3451.05	2935.42
APPROPRIATIONS : (a) A dividend @ 200 % i.e. Rs.20/- per equity share (previous year 200% i.e. Rs. 20/- per equity share) on 13,00,000 Equity Shares, which, if approved by the Shareholders at the Annual General Meeting, to be held on Friday, August 12, 2016,
will be paid out of the provision for dividend	260.00	260.00
(b) Tax on Dividend	52.93	52.93
(c) Amount transferred to General Reserve.	â	â
(d) Balance carried forward	3138.12	2622.49

OPERATIONS

The Company registered 6% growth in revenues as compared to previous year. While room revenues were 10% higher than the previous year, the F&B revenues decreased by1 %.

The newly opened Gateway Hotel at Gondia, Maharashtra in 2014, completed its first full financial year of operations and registered increase in revenues. The directors hope that the Hotelâs financial performance will continue to improve and the Hotel will be well received in the market.

Owing to decrease in F&B revenues and increase in operating expenses, the profit before taxes for the year was at Rs. 1287 Lacs, i.e. 10% lower than the previous year. Your directors hope that the Company will register superior financial performance in the next financial year i.e.2016-17.

DIVIDEND

Your Directors recommend the payment of dividend @200% (previous year dividend @ 200%) per equity share involving distribution of Rs. 260.00 lacs.

PARTICULARS OF EMPLOYEES

The Company had no employees during the year who were in receipt of remuneration aggregating to:

(a) Not less than Rs. 60.00 lacs for the year, if employed throughout the financial year, or

(b) Not less than Rs. 5.00 lacs per month, if employed for part of the financial year.

DIRECTORS

In accordance with the Companies Act, 2013 and the Articles of Association of the Company, Mr. Rakesh Sarna, Director of the Company is liable to retire by rotation and being eligible seeks reappointment.

KEY MANAGERIAL PERSONNEL

During the year under report, Mr. Ahmar Siddiqui, Chief Executive Officer (CEO) and Mr. P K Bhatia, Company Secretary of the Company resigned w.e.f. June 29, 2015 and March 28, 2016 respectively. They were replaced by Mr. Ashwani Anand as CEO and Ms. Vanika Mahajan as the Company Secretary of the Company w.e.f. July 23, 2015 and May 3, 2016 respectively. In terms of Section 203 of Companies Act, 2013, your Company has Mr. Ashwani Anand as the Chief Executive Officer (CEO), Mr. Ravi Sharma as the Chief Financial Officer (CFO) and Ms. Vanika Mahajan as the Company Secretary of the Company, as the Key Managerial Personnel of the Company.

INFORMATION PURSUANT TO RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014

The information pursuant to Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given in Annexure 1.

SUBSIDIARY COMPANIES

The Company does not have any subsidiary company

HOLDING COMPANY

The Indian Hotels Company Limited (IHCL) is the Ultimate Holding Company of the Company

NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR

The Company had convened 4 (Four) Board Meetings during the financial year under report.

AUDIT COMMITTEE AND VIGIL MECHANISM

In terms of Section 177 of the Companies Act, 2013, your Company has an Audit Committee with Mr. B.L. Passi, Mr. Shriraman, Mr. Rohit Khosla and Mrs. Rukmani Devi as its members.

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

In terms of Section 135 of the Companies Act, 2013 (the Act), your Company has the Corporate Social Responsibility Committee (CSR Committee) of the Board with Dr. Anant Narain Singh, Mr. D.R. Kaarthikeyan and Mr. Rohit Khosla as the members of the Committee. The brief outline of the Corporate Social Responsibility (CSR) Policy of your Company and the initiatives undertaken by your Company on CSR activities during the year are set out in âAnnexure 2â of this report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. The policy is available on the website of your Company www.benareshotelslimited.com.

NOMINATION AND REMUNERATION COMMITTEE

In terms of Section 178(1) of the Companies Act, 2013 (the Act), the Company has a Nomination and Remuneration Committee (NRC) of the Board with Dr. Anant Narain Singh, Mrs. Rukmani Devi and Mr. Shriraman as the members of the Committee. The Committee met thrice during the year on 7th May, 2015,23rd July, 2015 and 15th March, 2016.

In terms of the requirement of section 178(3) and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has a policy relating to the remuneration for the directors, KMPs and other employees. The key features of the said policy are:

- Overall remuneration (sitting fees and Commission) should be reasonable and sufficient to attract, retain and motivate directors aligned to the requirements of the Company

- Overall remuneration practices should be consistent with recognized best practices

- Within the parameters prescribed under the law, the payment of sitting fees and commission will be recommended by NRC and approved by the Board.

- The quantum of commission for each director shall be recommended by NRC to the Board based upon the outcome of the evaluation process drive by various factors including attendance and time spent in the Board and committee meetings, individual contributions at the meetings and contributions made by the Directors other than in meetings.

INTERNAL COMPLAINTS COMMITTEE

During the financial year 2015-16, the Company received one complaint from an industrial trainee at The Gateway Hotel Ganges - Varanasi, on sexual harassment. The Investigation for the same has been completed and accused employee has since resigned from the Company.

DECLARATION BY INDEPENDENT DIRECTORS

In terms of Section 149(7) of the Companies Act, 2013 (the Act), the Independent Directors have given a declaration that they meet the criteria of independence as per Section 149(6) of the Act.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

In addition to the Corporate Governance Guidelines discussed and adopted by the Board which, inter alia, included the role, rights and responsibilities of independent directors, the Company has an appropriate ongoing familiarisation programme, with respect to the roles, rights responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company, etc. The details of the familiarisation programme are disclosed on the Companyâs website under the weblink:www. benareshotelslimited.com.

LOANS, GUARANTEES AND INVESTMENTS MADE UNDER SECTION 186

During the year under report, the Company has placed/renewed a sum of Rs. 4.00 crores as short term Inter Corporate Deposits with bodies corporate within the limits prescribed under Section 186 of the Companies Act, 2013.

SECRETARIALAUDIT REPORT

In terms of Section 204(1) of the Companies Act, 2013, M/s A K Bhayana & Associates, Company Secretaries, were appointed by the Company as the Secretarial Auditor. The secretarial audit report as obtained from them is attached to this Report as Annexure 3. The report is self explanatory and does not call for any comments.

ANNUAL RETURN

The extract of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration ) Rules 2014 is furnished in Annexure 4 to this Report.

CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All related party transactions that were entered into during the financial year under report were at arm''s length basis and in the ordinary course of business.

Other than transactions entered into in the normal course of business, the Company has not entered into any materially significant related party transactions during the year, which could have a potential conflict of interest between the Company and its Promoters, Directors, Management and/or relatives save and except that the transaction with the Indian Hotels Co. Ltd., the ultimate holding company during the year exceeded 10% of the annual gross turnover of the Company for the previous year, the approval for which was taken from the shareholders by way of a special resolution at the AGM held on August 21, 2015.

CORPORATE GOVERNANCE

As required by Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the report on Management Discussion and Analysis, Corporate Governance as well as the Auditors'' Certificate regarding compliance of conditions of Corporate Governance, forms part of the Annual Report.

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

RISKMANAGEMENT POLICY

Pursuant to the provisions of Section 134 of the Act, your Company has a Risk Management Policy, to identify and evaluate business risks and opportunities. This framework seeks to create transparency, minimize adverse impact on business objective and enhance the Company''s competitive advantage. The risk framework defines the risk management approach across the enterprise at various levels including documentation and reporting.

Risk is analyzed by combining estimates of probability and impact in the context of existing control measures.

The Key business risks identified by the Company and its mitigation plans are as under:

Safety and Security Risks: Risks arising from factors such as Fire, Accidents, Electricity mishaps, etc. Business interruption on account of natural calamities/ acts of God/riots & strikes/political instability and terrorism.

Resources: Risks arising from sub-optimal succession planning and retention of talent pool. Inappropriate utilization of financial capital, talent and infrastructure.

KEY RISKMANAGEMENT PRACTICES

Risk Identification and Impact Assessment: Risk assessment enables risks to be appropriately rated and graded in accordance with their potential impact and likelihood. The two key components of risks are the probability (likelihood) of occurrence and the impact (consequence) if the risk occurs. Risk is analyzed by combining estimates of probability and impact in the context of existing control measures and included in the Risk Register. Apart from risk register, internal audit findings also provide input for risk identification and assessment, which is carried out on an annual basis across all functions.

Operational risks are assessed primarily on three dimensions, namely strength of underlying controls, compliance to policies and business procedure effectiveness.

Risk reporting and Disclosure: Risks to the achievement of key business objectives, trend line of risk level, impact and mitigation actions are reported risk level, impact and mitigation action are reported and discussed. The escalation of risk information is timely, accurate and gives complete coverage of the key risks to support management decision making at all levels.

Integration with Strategy and Business Planning:

AUDITORS

At the Annual General Meeting the Members will be required to appoint the Auditors for the current year and fix their remuneration.

CONSERVATION OF ENERGY

- Installation of LED lights in lobby, public areas and corridors in place of CFL lights.

- Replacing oil based hot water generation with heat pump that also generates useful chilled water concurrently and reduces heat loss.

- Converting primary and secondary pumping system into single variable primary system resulting in savings in electricity consumption.

- Improving power factor and reducing line losses by installing suitable capacitors.

TECHNOLOGYABSORPTION

The activities of the Company do not involve the absorption of technology as envisaged to be furnished pursuant to The Companies (Accounts) Rules, 2014.

FOREIGN EXCHANGE EARNINGS AND OUTGO

DIRECTORS EVALUATION

The Board of Directors has made the annual evaluation of its own performance and that of its committees and individual directors based on the review conducted by the Nomination & Remuneration Committee by assessing the questionnaires furnished by the directors/members of various committees in respect of their self assessment as well as the assessment of the Board/Committees followed by the discussions with the directors/ members of the Committees.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

DIRECTORSâ RESPONSIBILITY STATEMENT

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditors including audit of internal financial controls over financial reporting by the statutory auditor and the reviews performed by Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Companyâs internal financial controls were adequate and effective during the financial year 2015-16

Accordingly, pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm that:

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

b) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2016 and of the profit of the Company for that period;

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

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

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

ACKNOWLEDGEMENTS

The Board desires to place on record its appreciation of the services rendered by the employees of the Company during the year under review.

On behalf of the Board of Directors

Dr. Anant Narain Singh

Chairman

Place : Mumbai

Date : 3rd May, 2016

Mar 31, 2015

Dear Members,

The Directors hereby present the Forty Fourth Annual Report of the Company together with the Financial Statement (Audited Statements of Account) for the year ended 31st March, 2015.

OPERATING AND FINANCIAL RESULTS (Rs Lacs) (Rs Lacs) 2014-15 2013-14

Income 4824.06 4411.88

Gross Profit for the year 1693.01 1565.98

Less: Depreciation 267.23 190.28

Less: Interest

Profitbeforetax 1425.78 1375.70

Less: Provision for tax:

-CurrentTax 445.84 459.89

-DeferredTax 57.77 11.33

- Earlier years Taxes (0.45) 6.49

NetProfit 922.62 897.99

Add: Balance brought forward from previous year 2012.80 1519.00

Balance available for appropriations 2935.42 2416.99

APPROPRIATIONS :

(a) A dividend @ 200 % i.e. Rs.20/- per equity share (previous year 200% i.e. Rs. 20/- per equity share) on 13,00,000 Equity Shares, which, if approved by the Shareholders at the Annual General Meeting, to be held on Friday, 21st August, 2015, will be paid out ofthe provision for dividend 260.00 260.00

(b) Tax on Dividend 52.93 44.19

(c) Amount transferred to General Reserve Â 100.00

(d) Balance carried forward 2622.49 2012.80

OPERATIONS

The Company has improved its performance during the year registering 9% growth in revenue. While Room revenue was 11% higher than previous year, the Food and Beverage revenue was higher by 7% over previous year.

During the year under report, The Gateway Hotel, Balaghat Road, Gondia, Maharashtra comprising 34 rooms and related facilities has been made operational. The directors hope that the hotel will be well received in the market.

Owing to the opening of new hotel at Gondia, the Depreciation for the year was higher at Rs. 267.23 Lacs as compared to Rs. 190.28 Lacs in the previous year. The Profit before taxes for the year at Rs. 1425.78 Lacs was 4% higher than the previous year.

DIVIDEND

Your Directors recommend the payment of dividend @200% (previous year dividend @ 200%) per equity share involving distribution of Rs. 260.00 lacs.

PARTICULARS OF EMPLOYEES

The Company had no employees during the year who were in receipt of remuneration aggregating to:

(a) Not less than Rs. 60.00 lacs for the year, if employed throughout the financial year, or

(b) Not less than Rs. 5.00 lacs per month, if employed for part ofthe financial year.

DIRECTORS

During the year under report, Mr. Raymond N. Bickson resigned from the directorship of the Company with effect from 1st September, 2014. Mr. Prabhat Verma resigned from the directorship of the Company w.e.f. 29th April, 2015. The Directors place on record their appreciation of the services rendered by Mr. Bickson and Mr. Verma during their tenure as Director ofthe Company.

Mr. Rakesh Sarna and Mr. Rohit Khosla were appointed as Additional Directors by the Board of Directors at its meeting held on 24th March, 2015 and 7th May, 2015 respectively on the recommendation of the Nomination & Remuner- ation Committee. In terms of Section 161 of the Companies Act, 2013 and Article 122 of the Articles of Association of the Company, Mr. Sarna and Mr. Khosla hold office up to the date of the Annual General Meeting of the Company. It is proposed to appoint Mr. Sarna and Mr. Khosla as Director(s) of the Company at the ensuing Annual General Meeting. The Board of Directors commends their appointment. Except Mr. Sarna and Mr. Khosla, no other Director is interested in this item.

In accordance with the Companies Act, 2013 and the Articles of Association of the Company, Dr. Anant Narain Singh, Director of the Company is liable to retire by rotation and being eligible seeks reappointment.

KEY MANAGERIAL PERSONNEL

During the year under report, in terms ofSection 203 of Companies Act, 2013, your Company has appointed Mr. Ahmar Siddiqui as the ChiefExecutive Officer (CEO), Mr. Ravi Sharma as the Chief Financial Officer (CFO) and formalized the appointment ofMr. Prakash Bhatia, who already was the Company Secretary of the Company, as the Key Managerial Personnel ofthe Company.

INFORMATION PURSUANT TO RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014

The information pursuant to Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given in Annexure

SUBSIDIARY COMPANIES

The Company does not have any subsidiary company.

HOLDING COMPANY

The Indian Hotels Company Limited (IHCL) is the Ultimate Holding Company of the Company.

NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR

The Company had convened 5 (five) Board Meetings during the financial year under report.

AUDIT COMMITTEE AND VIGIL MECHANISM

In terms of Section 177 of the Companies Act, 2013, your Company has an Audit Committee with Mr. B.L. Passi, Mr. Shriraman, and Mrs. Rukmani Devi as its members.

Your Company has adopted the policy on vigil mechanism/Whistleblower policy in the Meeting of the Board of Directors held on 17th July, 2014 providing mechanism for employees of the Company to report their grievances to the Audit Committee with adequate protection against victimization to those who express their concerns.

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

In terms of Section 135 of the Companies Act, 2013 (the Act), your Directors have constituted the Corporate Social Responsibility Committee (CSR Committee) of the Board with Dr. Anant Narain Singh, Mr. D.R. Kaarthikeyan and Mr. Rohit Khosla as the members of the Committee. The terms of reference of the CSR Committee include the matters specified in Section 135 of the Act read with rules thereunder. Your Company has adopted the Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the

Company and the monitoring thereof as recommended by the CSR Committee. The details as required under Section 135 of the Companies Act, 2013 read with rule 8 of (Corporate Social Responsibility Policy) Rules, 2014, are given in Annexure 2 to this Report.

NOMINATION AND REMUNERATION COMMITTEE

In terms of Section 178(1) of the Companies Act, 2013 (the Act), the Company has a Nomination and Remuneration Committee (NRC) of the Board with Dr. Anant Narain Singh, Mrs. Rukmani Devi and Mr. Shriraman as the members of the Committee. The Committee met twice during the year on 17th, July, 2014 and 24th March, 2015.

In terms of the requirement of section 178(3) and Clause 49 of the Listing Agreement, NRC formulated and recommended to the Board a policy relating to the remuneration for the directors, KMPs and other employees which was adopted by the Board. The key features ofthe said policy are:

- Overall remuneration (sitting fees and Commis- sion) should be reasonable and sufficient to attract, retain and motivate directors aligned to the requirements ofthe Company;

- Overall remuneration practices should be consistent with recognized best practices

- Within the parameters prescribed under the law, the payment of sitting fees and commission will be recommended by NRC and approved by the Board.

- The aggregate commission payable to the Directors will be recommended by NRC to the Board based on company performance, profits, return to investors, shareholder value creation and any other significant qualitative parameters as may be decided by the Board.

- The quantum ofcommission for each director shall be recommended by NRC to the Board based upon the outcome of the evaluation process drive by various factors including attendance and time spent in the Board and committee meetings, individual contributions at the meetings and contributions made by the Directors other than in meetings.

INTERNAL COMPLAINTS COMMITTEE

The Company has an 'Internal Complaints Committee' under The Sexual Harassment ofWomen at Workplace (Prevention, Prohibition and Redressal) Act, 2013 for the prevention and redressal of complaints of sexual harassment and for the matters concerned, connected or incidental thereto.

The Company has not received any complaint on sexual harassment during the financial year 2014-15.

DECLARATION BY INDEPENDENT DIRECTORS

In terms of Section 149(7) of the Companies Act, 2013 (the Act), the Independent Directors have given a declaration that they meet the criteria of independence as per Section 149(6) of the Act.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

In addition to the Corporate Governance Guidelines discussed and adopted by the Board which, inter alia, included the role, rights and responsibilities of independent directors, a familiarization programme for independent directors was conducted during the year under report per details on the website of the Company www.benareshotelslimited.com.

LOANS, GUARANTEES AND INVESTMENTS MADE UNDER SECTION 186

During the year under report, the Company has placed a sum of Rs. 7.00 crores as short term Inter Corporate Deposits with bodies corporate within the limits prescribed under Section 186 of the Companies Act, 2013.

SECRETARIALAUDIT REPORT

In terms of Section 204(1) of the Companies Act, 2013, M/s A K Bhayana & Associates, Company Secretaries, were appointed by the Company as the Secretarial Auditor. The secretarial audit report as obtained from them is attached to this Report as Annexure 3. The report is self explanatory and does not call for any comments.

ANNUAL RETURN

The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration ) Rules 2014 is furnished in Annexure 4 to this Report.

CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All related party transactions that were entered into during the financial year under report were at arm's length basis and in the ordinary course of business.

The Company has developed a Related Party Transactions Framework under the Policy on Related Party Transactions, which policy is also available at Company's website www.benareshotelslimited.com, for the purpose of identification and monitoring of such transactions. Prior omnibus approval of the Board is obtained for transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted and a statement giving details of all the related party transactions is placed before the Audit Committee for its approval on a quarterly basis.

CORPORATE GOVERNANCE

As required by Clause 49 of the Listing Agreement with the Stock Exchanges, the report on Management Discussion and Analysis, Corporate Governance as well as the Auditors' Certificate regarding compliance of conditions of Corporate Governance, forms part of the Annual Report.

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

RISKMANAGEMENT POLICY

Pursuant to Clause 49 of the Listing Agreement, the Company has formulated a Risk Management Policy. The Company has a robust Risk Management framework to identify and evaluate business risks and opportunities. This framework seeks to create transparency, minimize adverse impact on business objective and enhance the Company's competitive advantage. The risk framework defines the risk management approach across the enterprise at various levels including documentation and reporting.

The framework enables risks to be appropriately rated and graded in accordance with their potential impact and likelihood. The two key components of risks are the probability (likelihood) of occurrence and the impact (consequence) of occurrence, if the risk occurs. Risk is analyzed by combining estimates of probability and impact in the context of existing control measures.

Existing control measures are evaluated against Critical Success Factors (CSFs) and Key Performance Indicators (KPIs) identified for those specific controls. Guiding principles to determine the risk consequence (impact), probability of occurrence (likelihood factor) and mitigation plan effectiveness have been set out in Risk Register.

The key business risks identified by the Company and its mitigation plans are as under:

Strategy Risks: Risk of erosion of market dominance by losing market share, which originates from the choices we make on markets, resources and delivery models that can potentially impact our competitive advantage in the medium and long term. Loss of F&B attractiveness on account of pricing / design / competition.

Industry and Economic Risks: High dependence on US, Europe and East Asian markets for foreign tourists arrival. The economic situation in these parts of the world has a potential impact on the entire tourism industry. Risks arising from the development in the regulatory environment that could impact the Hotel/Tourism Industry. Risks due to geographic concentration of business, primarily in the city of Varanasi.

Operational Risks: High dependence on several technology platforms & systems to operate business - both Internal & External. Cost overruns/ delays in completion of projects. Loss of critical / sensitive data due to leakage / loss / hacking. Increase in fixed cost elements beyond entity control. Highly litigious nature of the industry / adverse consequences of litigation against company. Non-renewal of key licenses and NOCs.

Safety and Security Risks: Risks arising from factors such as Fire, Accidents, Electricity mishaps, etc. Business interruption on account ofnatural calamities / act of God / riots & strikes / political instability and terrorism.

Resources: Risks arising from sub-optimal succession planning and retention of talent pool. Inappropriate utilization of financial capital, talent and infrastructure.

KEY RISKMANAGEMENT PRACTICES

Risk Identification and Impact Assessment: Risk assessment enables risks to be appropriately rated and graded in accordance with their potential impact and likelihood. The two key components of risks are the probability (likelihood) of occurrence and the impact (consequence) if the risk occurs. Risk is analyzed by combining estimates of probabi -lity and impact in the context of existing control measures and included in the risk register. Apart from risk register, internal audit findings also provide input for risk identification and assessment, which is carried out on an annual basis across all functions.

Operational risks are assessed primarily on three dimensions, namely strength of underlying controls, compliance to policies and business procedure effectiveness.

Risk reporting and Disclosure: Risks to the achievement of key business objectives, trend line of risk level, impact and mitigation actions are reported and discussed. The escalation of risk information is timely, accurate and gives complete coverage of the key risks to support management decision making at all levels.

Risk Mitigation and Monitoring: Each Manager creates a risk mitigation plan by employing an effective system of internal controls & checks and balances to mitigate the risks in the most effective manner, including designating responsibilities and providing for upward and onward communication of any significant issues that may merit attention or escalation. All employees actively engage in risk management within their own areas ofresponsibility.

Integration with Strategy and Business Planning:

Identified risks to the business objectives in the near term, medium term and long term are used as one of the key inputs for the development of strategy and annual business plan. Key strategic initiatives are identified to mitigate specific risk.

AUDITORS

At the Annual General Meeting the Members will be required to appoint the Auditors for the current year and fix their remuneration.

CONSERVATION OF ENERGY

The Company has always been conscious of the need for conservation of energy and has been sensitive in making progress towards this end. The Company has implemented following energy conservation initiatives at the hotel:

- Installation of LED lights in lobby, public areas and corridors in place of CFL lights.

- Replacing Existing split AC's with energy efficient inverter AC's at Nadesar Palace.

- Replacing oil based hot water generation with heat pump that also generates useful chilled water concurrently and reduces heat loss.

- Converting primary and secondary pumping system into single variable primary system resulting in savings in electricity consumption.

- Improving power factor and reducing line losses by installing suitable capacitors.

TECHNOLOGYABSORPTION

The activities of the Company do not involve the absorption of technology as envisaged to be furnished pursuant to The Companies (Accounts) Rules, 2014.

FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of the provisions of Section 134(3)(f)(m) of the Companies Act, 2013, read with Rule 8(3)(C) of The Companies (Accounts) Rules, 2014, the Foreign Exchange earned in terms of actual inflows during the year and the Foreign Exchange outgo during the year in terms of actual outflows is furnished in Notes on Accounts (Refer Note 28 and 29 in Notes to Financial Statements).

DIRECTORS EVALUATION

The Board of Directors has made the annual evaluation of its own performance and that of its committees and individual directors based on the review conducted by the Nomination & Remuner- ation Committee by assessing the questionnaires furnished by the directors/members of various committees in respect oftheir selfassessment as well as the assessment ofthe Board/Committees following by the discussions with the directors/members of the Committees.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is well defined in the organisation. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee ofthe Board.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control systems 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 function, process owners undertake corrective action in their respective areas and therby strengthen the controls. Significant audit observations and corrective actions suggested are presented to the Audit Committee ofthe Board.

DIRECTORS ' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(3)(C) & 134(5) of the Companies Act, 2013, the Board of Directors, based on the representations received from the Operating Management, hereby confirms that.

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

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 March 31, 2015 and of the profit 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 Act 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 Directors had laid down internal financial controls to be followed by Company and that such internal financial controls are adequate and were operating effectively; and

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

ACKNOWLEDGEMENTS

The Board desires to place on record its appreciation of the services rendered by the employees of the Company during the year under review.

On behalf of the Board of Directors

Dr. Anant Narain Singh Chairman

Place : Mumbai Date : 7th May, 2015

Mar 31, 2013

The Directors hereby present the Forty Second Annual Report of the Company together with the Audited Statements of Account for the year ended 31st March, 2013.

OPERATING AND FINANCIAL RESULTS

(Rs./Lacs) (Rs./Lacs) 2012-13 2011-12

Income 3984.62 3519.50

Gross Profit for the Year 1434.34 1132.30

Less: Depreciation 180.51 170.72

Profit before tax 1253.83 961.58

Less: Provision for tax:

-Current Tax 397.51 286.25

-Deferred Tax (14.95) 17.94

-Earlier years Taxes 13.66 38.16

Net Profit 857.61 619.23

Add: Balance brought forward from previous year 1065.58 988.09

Balance available for appropriations 1923.19 607.32

APPROPRIATIONS :

(a) A dividend @200% i.e. Rs. 20/- per equity share (previous year 160% i.e. Rs. 16/- per equity share) on 13,00,000 Equity Shares, which, if approved by the Shareholders at the Annual General Meeting to be held on Friday, 16th August, 2013 will be paid out of the provision for

dividend 260.00 208.00

(b) Tax on Dividend 44.00 33.74

(c) Amount transferred to General 100.00 300.00

(d) Balance carried forward 1519.00 1065.58

OPERATIONS

The Company has significantly improved its performance during the year registering 13% growth in revenues and 30% growth in Profit before Tax over the previous year. The Directors hope to sustain the standard of improvement in the performance during the current financial year. The work on the Hotel Project in Gondia, Maharashtra is in progress.

DIVIDEND

Your Directors recommend the payment of dividend @ 200% (previous year dividend @ 160%) per equity share involving distribution ofRs. 260.00 lacs.

PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A) OF THE COMPANIES ACT 1956

The Company had no employees during the year who were in receipt of remuneration aggregating to:

(a) Not less than Rs. 60.00 lacs for the year, if employed throughout the year, or

(b) Not less than Rs. 5.00 lacs per month, if employed for part of the year.

DIRECTORS

During the year under report, Mr. A.R. Gandhi and Mr. P.K. Mohankumar resigned from the Directorship of the Company with effect from 15th March, 2013 and 19th April, 2013 respectively. The Directors place on record their appreciation of the services rendered by Mr. Gandhi and Mr. P.K. Mohankumar during their tenure as Directors of the Company Mr. Prabhat Verma was appointed as an Additional Director of the Company by the Board of Directors vide Board Circular Resolution No. 1 of 2013-14 dated 19th April, 2013. In terms of Section 260 of the Companies Act, 1956 and Article 122 of the Articles of Association of the Company, Mr. Verma holds office upto the date of the Annual General Meeting of the Company. It is proposed to appoint Mr. Verma as Director of the Company at the ensuing Annual General Meeting. The Board of Directors commend his appointment.

In accordance with the Companies Act, 1956 and the Articles of Association of the Company, Mrs. Rukmani Devi, Dr. Anant Narain Singh and Mr. Raymond N. Bickson, Directors of the Company are liable to retire by rotation and being eligible seek reappointment.

SUBSIDIARY COMPANIES

The Company does not have any subsidiary company

AUDIT COMMITTEE

Mr. Shriraman, Mr. B.L. Passi and Mr. Prabhat Verma are the members of the Audit Committee.

CORPORATE GOVERNANCE

As required by Clause 49 of the Listing Agreement with the Stock Exchanges, the report on Management Discussion and Analysis, Corporate Governance as well as the Auditors'' Certificate regarding compliance of conditions of Corporate Governance, form part of the Annual Report.

AUDITORS

At the Annual General Meeting, the Members will be required to appoint the Auditors for the current year and fix their remuneration.

FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of the provisions of Section 217 (l)(e) of the Companies Act, 1956, read with Rule 2 of the Companies (Disclosure of Particulars in the Report of the Board ofDirectors) Rules, 1988, the information relating to foreign exchange earnings and outgo is furnished in Notes on Accounts (Refer Note Nos. 28,29 & 30).

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 217 (2AA) of the Companies Act, 1956, the Board of Directors, based on the representations received from the Operating Management, hereby confirms that

1. In the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

2. It has, in the selection of the accounting policies, consulted the Statutory Auditors and has applied them consistently and made judgements 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 March 31, 2013 and of the profit of the Company for that period;

3. It has taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities, to the best of their knowledge and ability. There are however, inherent limitations, which should be recognized while relying on any system of internal control and records;

4. It has prepared the annual accounts on a going concern basis.

ACKNOWLEDGEMENTS

The Board desires to place on record its appreciation of the services rendered by the employees of the Company during the year under review.

On behalf of the Board of Directors

Place : Gurgaon Dr. Anant Narain Singh

Date : IstMay, 2013 Chairman

Mar 31, 2012

The Directors hereby present the Forty First Annual Report of the Company together with the Audited Statements of Account for the year ended 31st March, 2012.

OPERATING AND FINANCIAL RESULTS

2011-12 2010-11 (Rs/Lacs) (Rs/Lacs)

Income 3519.50 2773.17

Gross Profit for the year 1132.30 895.16

Less: Depreciation 170.72 160.04

Less: Interest _ 1.77

Profit before tax 961.58 733.35

Less: Provision for tax

- Current Tax 286.25 216.89

-Deferred Tax 17.94 26.00

- Earlier years Taxes 38.15 -

Net Profit 619.23 490.46

Add: Balance brought forward from previous year 988.09 994.70

Balance available for appropriations 1607.32 1485.16

APPROPRIATIONS :

(a) A dividend @160% i.e. Rs. 16/- per equity share (previous year 130% i.e. Rs. 13 per equity share)on 13,00,000 Equity Shares, which, if approved by the Shareholders at the Annual General Meeting to be held on Monday, the 13th day of August, 2012 will be paid out of the provision for dividend. 208.00 169.00

(b) Tax on Dividend 33.74 28.07

(c) Amount transferred to General Reserve 300.00 300.00

(d) Balance carried forward 1,065.58 988.09

OPERATIONS

The Company has continued to improve its performance during the year under review with 27% growth in the revenues and 26% growth in Profit after Tax over the previous year. With steady growth expectations in the domestic tourism and foreign tourist arrivals and considering the overall economic and business scenario, your directors hope that the Company will continue the trend of improvement in the performance during the current financial year. The work on the Hotel project in Gondia, Maharashtra is progressing satisfactorily.

DIVIDEND

Your Directors recommend the payment of dividend @ 160% (previous year dividend @ 130%) per equity share involving distribution of ? 208.00 lacs.

PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956

The Company had no employees during the year who were in receipt of remuneration aggregating to:

(a) Not less than Rs. 60.00 lacs for the year, if employed throughout the year; or

(b) Not less than Rs. 5.00 lacs per month, if employed for part of the year.

DIRECTORS

During the year, Mr. D R Kaarthikeyan was appointed as an Additional Director of the Company on 17th October, 2011 In terms of Section 260 of the Companies Act 1956 and Article 122 of the Articles of Association of the Company, Mr. Kaarthikeyan holds the office upto the date of the Annual General Meeting of the Company. It is proposed to appoint Mr. Kaarthikeyan as Director of the Company at the ensuing Annual General Meeting. The Board of Directors commend his appointment.

In accordance with the Companies Act, 1956 and the Articles of Association of the Company, Mr. B L Passi, Mr. P K Mohankumar and Mr. Shriraman, Directors of the Company are liable to retire by rotation and being eligible seek reappointment.

STATUS OF COMPANY

Your Company became a subsidiary company of The Indian Hotels Company Ltd. (IHCL) during the year.

AUDIT COMMITTEE

Mr. Shriraman, Mr. B.L. Passi and Mr. P. K. Mohankumar are the members of the Audit Committee.

CORPORATE GOVERNANCE

As required by Clause 49 of the Listing Agreement with the Stock Exchanges, the report on Management Discussion and Analysis, Corporate Governance as well as the Auditor's Certificate regarding compliance of conditions of Corporate Governance, form part of the Annual Report.

AUDITORS

At the Annual General Meeting, the Members will be required to appoint the Auditors for the current year and fix their remuneration.

FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of the provisions of Section 217 (1)(e) of the Companies Act, 1956, read with Rule 2 of the Companies (Disclosure ofParticulars in the Report of the Board of Directors) Rules, 1988, the information relating to foreign exchange earnings and outgo is furnished at point No. 5 & 6 in the Note No. 22 to the financial Statements.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 217 (2AA) of the Companies Act, 1956, the Board of Directors, based on the representations received from the Operating Management, hereby confirms that :-

1. in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

2. it has, in the selection of the accounting policies, consulted the Statutory Auditors and has applied them consistently and made judgements 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 March 31, 2012 and of the profit of the Company for that period;

3. it has taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities, to the best of their knowledge and ability. There are however, inherent limitations, which should be recognized while relying on any system of internal control and records;

4. it has prepared the annual accounts on a going concern basis.

ACKNOWLEDGMENTS

The Board desires to place on record its appreciation of the services rendered by the employees of the Company during the year under review.

On behalf of the Board of Directors

Place : Mumbai Dr. Anant Narain Singh

Date : 3rd May, 2012 Chairman

Mar 31, 2011

To the Members

The Directors hereby present the Fortieth Annual Report of the Company together with the Audited Statements of Account for the year ended 31st March, 2011.

OPERATING AND FINANCIAL RESULTS 2010-11 2009-10 (Rs./Lacs) (Rs./Lacs)

Income 2,773.17 2,347.19

Gross Profit for the year 893.38 711.50

Less: Depreciation 160.03 153.20

Profit before tax 733.35 558.30

Less: Provision for tax

- Current Tax 216.89 151.63

- Deferred Tax 26.00 29.71

Net Profit 490.46 376.96

Add: Balance brought forward from previous year 994.70 852.81

Balance available for appropriations 1,485.16 1,229.77

APPROPRIATIONS :

(a) A dividend @130% i.e. Rs. 13/- per equity share (previous year 130% i.e. Rs. 13 per share) on 13,00,000 Equity Shares, which, if approved by the Shareholders at the Annual General Meeting to be held on Wednesday, the 10th day of August, 2011 will be paid out of the provision for dividend 169.00 169.00

(b) Tax on Dividend 28.07 28.07

(c) Amount transferred to General Reserve 300.00 38.00

(d) Balance carried forward 988.09 994.70

OPERATIONS

The Company improved its performance during the year under review consequent to the improvement in the global economy which also contributed to gradual recovery in the hospitality sector and control over costs. The Directors hope that the trend of improvement in performance would continue during the current financial year. The Company is also in the process of setting up a hotel in Gondia, Maharashtra.

DIVIDEND

Your Directors recommend the payment of dividend @ 130% (previous year dividend @ 130%) per equity share involving distribution of Rs. 169.00 lacs.

SECRETARIAL COMPLIANCE

In terms of Section 383A of the Companies Act, 1956, the Company has obtained the Secretarial Compliance Certificate from a Practising Company Secretary. A copy of the said Certificate is attached to this Report.

PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956

The Company had no employees during the year who were in receipt of remuneration aggregating to :

(a) Not less than Rs. 60.00 lacs for the year, if employed throughout the year; or

(b) Not less than Rs. 5.00 lacs per month, if employed for part of the year.

DIRECTORS

During the year under report, Mr. P. Sanker and Ms. Deepa Misra Harris, Directors resigned from the directorship of the Company on 19th August, 2010 and 15th October, 2010 respectively. The Directors place on record their appreciation of the services rendered by Mr. Sanker and Ms. Harris during their tenure as Director of the Company.

In accordance with the Companies Act, 1956 and the Articles of Association of the Company, Dr. Anant Narain Singh, Mr. Raymond N. Bickson and Mr. A.R. Gandhi, Directors of the Company are liable to retire by rotation and being eligible seek reappointment.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956, the Board of Directors, based on the representations received from the Operating Management, hereby confirms that

1. in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

2. it has, in the selection of the accounting policies, consulted the Statutory Auditors and has applied them consistently and made judgements 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 March 31, 2011 and of the profit of the Company for that period;

3. it has taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities, to the best of their knowledge and ability. There are however, inherent limitations, which should be recognized while relying on any system of internal control and records; and

4. it has prepared the annual accounts on a going concern basis.

AUDIT COMMITTEE

Mr. Shriraman, Mr. B.L. Passi and Mr. P.K. Mohankumar are the members of the Audit Committee. Mr. Mohankumar was appointed as a Member of the Audit Committee vice Mr. P. Sanker consequent to his resignation from the directorship of the Company.

CORPORATE GOVERNANCE

Consequent to the Net Worth of the Company exceeding Rs. 25 crores for the first time in the history of the Company as at the end of the financial year 2010-11, Clause 49 of the Listing Agreement with the Stock Exchange/s regarding Corporate Governance has become applicable to the Company from the financial year 2011-12. Accordingly, the Company shall comply with the provisions of Clause 49 in the course of the current financial year.

AUDITORS

At the Annual General Meeting, the Members will be required to appoint the Auditors for the current year and fix their remuneration.

FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of the provisions of Section 217 (l)(e) of the Companies Act, 1956, read with Rule 2 of the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988, your Directors wish to inform you that electricity, diesel, petrol, and cooking gas are purchased at the prevailing market rates from the government agencies at Varanasi. The generation of electricity is required to supplement the power supply from the Electricity Boards/Agencies.

The activities of the Company are not covered under the list of specified industries in the Schedule to the Rules as stated above.

The information relating to foreign exchange earnings and outgo is furnished at point No. 4 & 5 in the Notes on Accounts.

ACKNOWLEDGEMENTS

The Board desires to place on record its appreciation of the services rendered by the employees of the Company during the year under review.

On behalf of the Board of Directors

DR. ANANT NARAIN SINGH Chairman

Place : Mumbai Date : 2nd May, 2011

Mar 31, 2010

The Directors hereby present the Thirty Ninth Annual Report of the Company together with the Audited Statements of Account for the year ended 31st March, 2010.

OPERATING AND FINANCIAL RESULTS 2009-10 2008-09 (Rs./Lacs) (Rs./Lacs)

Income................................ 347.19 2,044.15

Gross Profit for the year ............. 711.50 601.37

Less: Depreciation.................... 153.20 109.56

Profit before tax...................... 558.30 491.81

Less: Provision for tax

-Current Tax ......................... 151.63 156.76

-Deferred Tax.......................... 29.71 11.53

- Fringe Benefit Tax .................. -- 1.75

Net Profit............................. 376.96 321.77

Add: Balance brought forward from previous year.................. 852.81 695.33

Balance available for appropriations...... 1,229.77 1,017.10

APPROPRIATIONS:

(a) A dividend @130% i.e. Rs. 13/- per equity share (previous year 85% i.e. Rs. 8.50 per share) on 13,00,000 Equity Shares, which, if approved by the Shareholders at the Annual General Meeting to be held on Friday, 13th August, 2010 will be paid out of the provision for dividend............................. 169.00 110.50

(b) Tax on Dividend................... 28.07 18.78

(c) Amount transferred to General Reserve.......................... 38.00 35.00

(d)Balance carried forward............ 994.70 852.81

OPERATIONS

The impact of the global economic slowdown and the travel advisories on swine flue scare adversely impacted the business during the first half of the financial year. However, the improvement in the global economy in the second half of the financial year and the addition of Nadesar Palace enabled the Company to register an improved performance over the previous year. The Directors hope that with the return of the normalcy in the global economic scenario, the business would further improve in the current financial year.

DIVIDEND

Your Directors recommend the payment of dividend @ 130% (previous year dividend @ 85%) per equity share involving distribution of Rs. 169.00 lacs.

SECRETARIAL COMPLIANCE

In terms of Section 383A of the Companies Act, 1956, the Company has obtained the Secretarial Compliance Certificate from a Practising Company Secretary. A copy of the said Certificate is attached to this Report.

PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956

The Company had no employees during the year who were in receipt of remuneration aggregating to :

(a) Not less than Rs. 24.00 lacs for the year, if employed throughout the year; or

(b) Not less than Rs. 2.00 lacs per month, if employed for part of the year.

DIRECTORS

In accordance with the Companies Act, 1956 and the Articles of Association of the Company, Mr. Shriraman, Mrs. Rukmani Devi and Ms. Deepa Misra Harris, Directors of the Company are liable to retire by rotation and being eligible seek reappointment.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956, the Board of Directors, based on the representations received from the Operating Management, hereby confirms that

1. in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;

2. it has, in the selection of the accounting policies, consulted the Statutory Auditors and has applied them consistently and made judgements 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 March 31, 2010 and of the profit of the Company for that period;

3. it has taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities, to the best of their knowledge and ability. There are however, inherent limitations, which should be recognized while relying on any system of internal control and records; and

4. it has prepared the annual accounts on a going concern basis.

AUDIT COMMITTEE

Mr. Shriraman, Mr. B.L. Passi and Mr. P. Sanker are the members of the Audit Committee.

AUDITORS

At the Annual General Meeting, the Members will be required to appoint the Auditors for the current year and fix their remuneration.

FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of the provisions of Section 217 (l)(e) of the Companies Act, 1956, read with Rule 2 of the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988, the information relating to foreign exchange earnings and outgo is furnished at point No. 4 & 5 in the Notes on Accounts.

ACKNOWLEDGEMENTS

The Board desires to place on record its appreciation of the services rendered by the employees of the Company during the year under review.

On behalf of the Board of Directors

DR. ANANT NARAIN SINGH Chairman

Place : Mumbai

Date : 10th May, 2010

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