Kaushalya infrastruction development Directors' Report Dear Shareholders, The Directors are pleased to present the 23rd Annual Report and the Audited Accounts for the financial year ended March 31, 2015. STATE OF AFFAIR & OPERATIONS REVIEW During the year under review on a Standalone basis your Company has registered total income from operation of Rs. 694.88 Lacs as against Rs. 1616.29 Lacs in the previous year. Reduction in top line was due to delay in decisions from various clients for tenders submitted by Company and lower success rates in bids for infrastructure projects made in a significantly reduction in overall realization of Company. The profit before Depreciation, interest and tax for the year stood to Rs. 1.35 Lacs as compared to Rs. (731.80) Lacs in previous year. The PAT was Rs. (727.86) Lacs against the financial year PAT Rs. (1398.90). The loss figure occurred during current period is mainly due to write off various debtors and depreciation figure as the company has reassessed the useful life of all the tangible fixed assets based on useful life as provided in the schedule II of Companies Act, 2013. Depreciation has been provided considering the remaining useful life of the assets and necessary effect has been given in the accounts. On Consolidated basis, during the year under review the Total Income of your company stood to Rs. 700.14 Lacs as against Rs. 1623.85 Lacs in the previous year. The EBIDT is Rs. 4.24 Lacs from Rs. (726.13) Lacs in the previous year. DIVIDEND Your Directors do not recommend payment of dividend for the year under review on equity shares in view of the loss incurred. CHANGE IN NATURE OF BUSINESS, IF ANY During the year under review, there has been no change in the nature of business of the Company. MATERIAL CHANGES AND COMMITMENTS AFTER THE BALANCE SHEET DATE There have been no material changes and commitments, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report. SUBSIDIARY COMPANIES & ASSOCIATE COMPANIES As on 31st March 2015, the Company's subsidiaries, step down subsidiaries, associates and joint venture are as follows: Its subsidiaries/step-subsidiaries 1. Bengal KDC Housing Dev. Ltd 2. Bengal Kaushalya Nirman Ltd 3. Kaushalya Township Pvt Ltd (Step down Subsidiary) 4. Kaushalya Energy Pvt Ltd 5. Azur Solar KDC Pvt Ltd (Step down Subsidiary) Its associate 1. Orion Abasaan Pvt Ltd 2. Kaushalya Nirman Pvt Ltd Its joint venture 1. Kidco-Nacc During the year KaushalyaNirman Private Ltd, Orion Abasaan Private Ltd and Kaushalya Township Private Ltd had approached to your Company for consent to raise Equity Capital from investor to further their projects which may result in your Company shareholding to become less than 50%. After due consideration and to unlock value in the projects of the Subsidiaries (not following within the definition of material subsidiary as per clause 49(III) (V) of Listing Agreement) and enable them to raise funds the Board of Directors of your Company gave their due consent. However Bengal KDC Housing Development Ltd holds 34,000(5.22%) in Kaushalya Township Private Ltd, hence Kaushalya Township Private Ltd is step down subsidiary of your Company. A Policy has been formulated for determining the Material Subsidiaries of the Company pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges. The said Policy has been posted on the Company's website at the weblink: htp://www.kaushalya.net/KIDCOMATERIAL.pdf A statement containing the salient features of the financial statements of each of the subsidiaries & associates in the prescribed format AOC-1 is appended as "Annexure - 1" to this Report. The statement also provides details of performance and financial positions of the subsidiaries, associates and joint venture CONSOLIDATED FINANCIAL STATEMENTS In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared Consolidated Financial Statements of the Company and of all its subsidiary and associate companies, which is forming part of the Annual Report. As per the provisions of Section 136 of the Companies Act, 2013, separate audited financial statements of its subsidiaries are being placed on its website www.kaushalya.net and copy of separate audited financial statements of its subsidiaries will be provided to the shareholders on request. LISTING OF EQUITY SHARES Your Company's Equity Shares are listed on the BSE Ltd and National Stock Exchange of India Ltd. The Company paid the annual listing fees to each of these stock exchanges. CHANGE IN SHARE CAPITAL During the year under review, your Company's Authorised Share Capital has remain unchanged at Rs. 35,00,00,000 (Rupees Thirty Five Crore) comprising 3,50,00,000 Equity Shares of Rs. 10/- each. During the year under review, your Company's paid up equity share capital remain unchanged changed Rs. 34,63,06,300 (Rupees Thirty Four Crores Sixty Three Lacs Six Thousand) comprising of 3,46,30,630 Equity Shares of Rs. 10/- each. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND. During the year your Company has transferred amount of Rs. 163,680/- Share Application Money due for refund to Investor Education and Protection fund as per provision of section 125 of Companies Act, 1956. There has been no delay in transferring amounts to Investor Educaion and Protection fund by the Company. EMPLOYEE STOCK OPTION SCHEME Your Company has not come out with Employee Stock Option Scheme during the year. DIRECTOR Mr. Ramesh Kumar Mehra (DIN: 00086598), Director retire by rotation at the forthcoming Annual General Meeing of the Company and not to ill the vacancy. He does not seek re-appointment and therefore not re-appoint him as a Director of a Company. Mrs. Minoi Nath (DIN: 07017530) was appointed as Additional Director of the Company in the category of Independent Director by the Board in its meeting held on 13th November, 2014. She shall hold office up to the date of ensuing Annual General Meeting of the Company and will be eligible for reappointment as Independent Director. The Company has received a notice from a member pursuant to Section 160 of the Companies Act, 2013 stating intent to propose him for the office of Independent Director under Section 149 of the Companies Act, 2013. All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement. During the year Mr. Saki Pada Banerjee resigned and ceased to be an Independent Director of the Company w.e.f. 25th June, 2014 due to health constraints. The Board has placed on record its appreciation for the outstanding contributions made by Mr. Sakti Pada Benrjee during his respective tenures as director of the Company. Resolutions seeking approval of the members have been incorporated in the notice of the forthcoming Annual General Meeting. Brief resume/details relating to Directors who are to be appointed/re-appointed are furnished in the Explanatory Statement to the Notice of the ensuing Annual General Meeting as required under the Code of Corporate Governance. The members in the last AGM approved reappointment of Mr. Prashant Mehra as Managing Director. The members also approved appointment of Mr. Rajesh Kumar Agarwal and Mr. Parag KesharBhatacherjee as Independent Directors. KEY MANAGERIAL PERSONNEL In compliance of the provisions of Section 203 of the Companies Act, 2013 the following persons were the key managerial personnel of the Company: (a) Mr. Prashant Mehra, Managing Director & Chief Executive Officer (b) Mr. T.N Mishra, Chief Financial Officer (c) Mr. Tarkeshwar Singh, Company Secretary. LOAN/ADVANCES Pursuant to Clause 32 of the Listing Agreement, the particulars of loans/advances given to subsidiaries have been disclosed in the Annual Accounts of your company. DIRECTORS' RESPONSIBILITY STATEMENT The Board of Directors of your Company acknowledges the responsibility for ensuring compliance with the provisions of Section 134(3) (c) read with Section 134(5) of the Companies Act, 2013 and Clause 49(III)(D)(4)(a) of the Listing Agreement with the Stock Exchanges in the preparation of the annual accounts for the year ended 31st March, 2015 and state that : I. In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; if any II. The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profits of the Company for that period; III. The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; IV. The Directors have prepared the annual accounts on a going concern basis; V. The Directors have laid down internal financial controls for the Company and such internal financial controls are adequate and operating effectively; and VI. There is a proper system to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively. PARTICULARS OF EMPLOYEES The particulars of employees, as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) and 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are given in a separate annexure attached hereto and forms part of this report as 'Annexure II'. FIXED DEPOSITS The Company has not accepted any deposit from the public, and as such, there are no outstanding deposits in terms of the Companies (Acceptance of Deposits) Rules, 2014. NUMBER OF MEETINGS OF THE BOARD The Board met six times during the financial year, the details are given in the Corporate Governance Report that forms part of the Annual Report. AUDIT COMMITTEE The Audit Committee was constituted by the Company and the details of terms of reference of the Audit Committee, number and dates of meeting held, attendance, among others are given separately in the attached Corporate Governance Report. During the year there were no instances of the Board had not accepting the recommendations of the Audit Committee. WHISTLE BLOWER POLICY The Company has in place a whistleblower policy to deal with unethical behavior, victimization, fraud and other grievances or concerns, if any. The aforementioned whistleblower policy can be accessed on the Company's website: htp://www.kaushalya.net/KDCVIGIL.pdf RISK MANAGEMENT POLICY The Company has a defined Risk Management framework to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. The Risk Management Policy provides for identification of risk, its assessment and procedures to minimize risk. The policy is periodically reviewed to ensure that the executive management controls the risk as per decided policy. NOMINATION & REMUNERATION COMMITTEE A Nomination & Remuneration Committee was constituted by the Company and the details of terms of reference, number and dates of meeting held, attendance, among others are given separately in the Corporate Governance Report forming part of this Annual Report. STAKEHOLDERS' RELATIONSHIP COMMITTEE The composition and terms of reference of the Stakeholders' Relationship Committee has been furnished in the Corporate Governance Report forming part of this Annual Report. POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION The Policy of the Company on Directors' appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a Director and other maters provided under sub-Section (3) and (4) of Section 178, is attached as 'Annexure-III' to this Report. The remuneration policy is stated in the Corporate Governance Report of this Annual Report. BOARD EVALUATION Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual evaluation of its own performance of the individual directors as well as the working of its Audit, Nomination & Remuneration and Stakeholders Relationship committees. The manner in which the evaluation has been carried out has been explained in the attached Corporate Governance Report integral part of this Annual Report. INTER-CORPORATE LOANS, GUARANTEES AND INVESTMENTS The provisions of Section 186 of the Companies Act, 2013 in relation to loans or guarantee are not applicable to the Company, being an infrastructure company as defined under Schedule VI to the Act. Details of loans, guarantees and investments covered under the provisions of section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements. RELATED PARTY TRANSACTIONS All related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business. There were no materially significant related party transactions made by the Company which may have a potential conflict with the interest of the Company at large. All related party transactions were placed before the Audit Committee and also for the Board approval, wherever required. Prior omnibus approval of the Audit Committee is generally obtained for the transactions which are of a foreseen and repetitive nature and these transactions are reviewed by the Audit Committee on quarterly basis. The policy on related party transactions as approved by the Board is uploaded on the Company's website htp://www. kaushalya.net/KIDCORELATED.pdf <http://kaushalya.net/KIDCORELATED.pdf>. The details of transactions entered into with related parties are attached as 'Annexure IV' in form AOC-2 that form an integral part of this Report. EXTRACT OF ANNUAL RETURN The details forming part of extract of annual return as per Form MGT- 9 is annexed herewith as 'Annexure - V'. INTERNAL FINANCIAL CONTROL The Company has in place adequate internal financial control with reference to the financial statements. During the year, such control was reviewed and no reportable material weakness was observed. CORPORATE GOVERNANCE The Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements as set out in Clause 49 of the Listing Agreement. The Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement forms an integral part of this Annual Report. MANAGEMENT DISCUSSION AND ANALYSIS Management Discussion and Analysis for the year under review, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges, is presented in a separate section forming part of this Annual Report. CEO/CFO CERTIFICATION As required by Clause 49 of the Listing Agreement, the CEO/ CFO certification has been submitted to the Board and a copy thereof is contained elsewhere in this Annual Report. SECRETARIAL AUDIT REPORT Pursuant to the provisions of Section 204 of the Companies Act, 2013, the Company has appointed M/S. Rinku Gupta & Associates, Company Secretaries in Practice, to undertake the secretarial audit of the Company for the financial year 2014-15. The Secretarial Audit Report for the financial year ended 31st March, 2015 is attached as Annexure 'VI' and forms a part of the reports of the Directors. The observation made by the secretarial auditors in their report are self-explanatory and therefore do not call for any further explanations/comments. AUDITORS & AUDITOR'S REPORT At the Annual General Meeting held in the year 2014, M/s Sumanta & Co., Chartered Accountants, (ICAI Firm Registration No. 322554E) Statutory Auditors of the Company were re-appointed by the shareholders to hold office as Statutory Auditors from the conclusion of Annual General Meeting held in the year 2014 ill the conclusion of Twenty Fifth Annual General Meeting of the Company to be held in the year 2017, subject to ratification of their appointment at every Annual General Meeting. Under Section 139 of the Companies Act, 2013, the Company is required to place the matter relating to Statutory Auditor's appointment for ratification by members at every Annual General Meeting. The Company has received a letter from the Statutory Auditors confirming that they are eligible for appointment as Auditors of the Company under Section 139 of the Companies Act, 2013 and meet the criteria for appointment specified in Section 141 of the Companies Act, 2013. Based on the recommendations by the Audit Committee, the Board of Directors of the Company recommends the ratification of appointment of M/s Sumanta & Co., Chartered Accountants, (ICAI Firm Registration No. 322554E) as Statutory Auditors of the Company by the shareholders at the ensuing Annual General Meeting. The observations of the Auditors in their report, read together with the notes on Accounts, are self-explanatory and therefore, in the opinion of the Directors, do not call for any further explanation. COST AUDITORS The cost audit u/s 148 of Companies Act, 2013 read with its rule is not applicable for your Company for the financial year ended 31st March, 2015. CSR COMMITTEE Pursuant to provisions of section 135(1) of Companies Act, 2013 formation of such committee is not applicable to your Company. RESTRUCTURING OF DEBTS The bankers of the company have intimated that the second restructuring process for the loan accounts, meanwhile classified as non-performing, has taken considerable time. The same is under process at their end and the company is following up with the Bankers to expedite the process of second restructuring of its accounts. OTHER INFORMATION The Audit Committee of your company has reviewed the audited financial statements for the year under review at its meeting held on May 30, 2015 and recommended the same for the approval of the Board of Directors. SEXUAL HARASSMENT POLICY The Company has a Policy on Prohibition, Prevention and Redressal of Sexual Harassment of Women at Workplace and matters connected therewith or incidental thereto covering all the aspects as contained under the "The Sexual Harassment of Women at Workplace (Prohibition, Prevention and Redressal) Act, 2013". Up till date, the Company has not received any complaint under the Policy. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / COURTS / TRIBUNALS There are no significant material orders passed by the Regulators / Courts / Tribunals which would impact the going concern status of the Company and its future operations CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO Presently, your company is not engaged in any activity relating to conservation of energy or technology absorption. During the year under review, your company has no foreign exchange earnings and outgoes. APPRECIATION Your Board of Directors wish to thank the Central Government, the Government of West Bengal, the financial institutions, its Bankers, shareholders, customers, dealers and other business associates for the support received from them during the year. Your Directors place on record their sincere appreciation for all employees of the Company and for their unstinted commitment and continued contribution to the Company. For and on behalf of the Board Ramesh Kumar Mehra DIN: 00086598 Chairman Kolkata 13th August, 2015 Registered office: HB-170, Sector-III Salt Lake-Kolkata-700106 CIN-L51216WB1992PLC055629 |