To The Members Ekam Leasing and Finance Co. Limited
Your Directors are pleased to have this opportunity to present the 30th Annual Report of the Company together with the Standalone and Consolidated Audited Financial Statements of the Company for the year ended March 31, 2023.
FINANCIAL RESULTS
DIVIDEND
Keeping in view of the loss during the year and the requirement of funds for future business operations, the board has not recommended any dividend for the financial year ended 31st March 2023.
COMPANY'S PERFORMANCE
During the year under review, the Company has earned total revenue of Rs. 63.09 Lacs as against 57.31 Lacs resulting an increase of 10.08% in total revenue. However due to increased expenditure the Company suffered losses after tax in current financial year..
On consolidated basis, revenue for F.Y. 2022-23 stood at is Rs. 63.09 Lacs as against Rs. 57.31 Lacs during the previous year resulting an increase of 10.08% in total revenue. However due to increased expenditure the Company suffered losses after tax in current financial year.
Human Resource Development is the framework for helping employees develop their personal and organizational skills, knowledge, and abilities. Human Resource is not only an integral part of any organization but also strive its success and growth. The Company believes that human resources are the key resources and integral part of the organization and endeavors to create a culture of openness and empowerment amongst its employees and provide good carrier development.
Your Company believes in trust transparency & teamwork to improve employees productivity at all levels and is committed to the welfare of the employees and their families by putting review and reward system in place.
TRANSFER TO RESERVES
During the Year under Review, the Company transferred Nil amount to Statutory Reserve under section 45 IC of Reserve Bank India Act, 1934 due to losses. outstanding Balance of Standalone reserve stood at (10.01) Lacs and Consolidated reserve stood at 526.21 lacs as on 31st March, 2023.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN MARCH 31, 2023 AND THE DATE OF REPORT
As required under Section 134(3) of the Act, the Board of Directors informs the members that during the financial year i.e. 31 March, 2023, there have been no material changes between the closing of the financial year of the Company till the date of this report, except as disclosed elsewhere in the Annual Report.
PERFOPRMANCE HIGHLIGHTS OF SUBSIDIARY AND ASSOCIATES COMPANIES SUBSIDIARY COMPANIES:-
M/s S & S Balajee Mercantile Private Limited having CIN: U51109DL1993PTC052329 incorporated to carry on the business of dealing and trading in all kinds of essential commodities/Machinery, etc.
M/s Jet Air Securities Private Limited having CIN:U74899DL1995PTC069004 which is mainly engaged in business of dealing in securities.
M/s Rex Overseas Private Limited having CIN:U74899DL1988PTC032551 is engage into the business of import export and all deal in all kind of securities.
JOINT VENTURE COMPANY
There are no joint venture company at any time during the financial year 2022-2023.
ASSOCIATE COMPANY
There are no associate companies at any time during the financial year 2022-2023.
Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 ("Act"), a statement containing brief financial details of the Company's subsidiaries, associate companies and joint ventures for the financial year ended March 31, 2023 in Form AOC-1 is annexed to the Board Report of the Company as Annexure-I and also available on company's website at www.ekamleasing.com.
As required by Section 134(3)(c) of the Companies Act, 2013, Directors state 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 at the end of the financial year and of the profit and loss of the company for that period;
c) The directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this 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 the 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.
DECLARATION FROM INDEPENDENT DIRECTOR
Pursuant to the provision of Section 149(7) of the Act read with Regulation 25(8) of the SEBI (LODR) Regulations, 2015, the Company has received a declaration from each of the Independent Director that they meets the criteria of independence as provided under section 149(6) of the Act & SEBI (LODR) Regulations, 2015 and there has been no change in the circumstances which may affect their status as independent director during the year.
All the Independent Directors of the Company have complied with the requirement pertaining to the inclusion of their names in the data bank of independent directors maintained by Indian Institute of Corporate Affairs and they meet the requirements of proficiency self-assessment test.
In the opinion of Board of Directors of the Company, Independent Directors on the Board of Company hold highest standards of integrity and are highly qualified, recognised and is doyen of the industry. There is an optimum mix of expertise (including financial expertise),leadership and professionalism.
RBI GUIDELINES
The Company is complying with all the applicable guidelines/directions of the Reserve Bank of India for Non Banking Finance Company pursuant to Non-Banking Financial (Non - Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2015 and Master direction Non Banking Finacial Company-Non Systematically Important Non Deposit taking company (Reserve Bank) Direction, 2016, Master Direction- Non-Banking Financial Company Returns (Reserve Bank) Directions, 2016 the particulars as applicable to the Company are appended to the Balance Sheet.
THE RBI NORMS AND ACCOUNTING STANDARDS
The company continues to comply with the directives and accounting standard as well as the norms prescribed by Reserve Bank of India for NBFCs for the financial year 2022-23.
CHANGE IN BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of Section 149 and 152 of the Companies Act, 2013 and rules made there under as amended from time to time and Regulation 17 of the SEBI (LODR) Regulations 2015. During the Year under review,there was no change in board composition of the company except the following: -
Mr. Amit kumar Khaitan resigned from the post of Chief Financial Officer dated 02nd May, 2022.
Mr. Astik Mani Tripathi resigned from the post of Non Executive Independent director of the Company dated 12thMay, 2022.
Mrs. Rashi Varshney was appointed as Non Executive Independent Director of the Company w.e.f. 07th December 2022.
In accordance with the provision of Section 203 of the Companies Act 2013 read with rule 9 of Companies (Appointment & Remuneration of Managerial Personnel) Rule, 2014 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Ms. Neha Sharma was appointed as a Company Secretary & Compliance Officer of the Company w.e.f. 07th December 2022 and resigned on 6th June, 2023.
Ms. Khushambi has appointed as a Company Secretary and Compliance officer of the company w.e.f 6th July, 2023.
MEETINGS OF THE BOARD OF DIRECTORS
The Board of Directors of your Company met 6 (Six) times during the Financial year 2022-23.The dates of the board meetings are 12th May 2022, 30thMay 2022, 14th August 2022, 14th November 2022, 07th December 2022 and 14th Februray 2023. The necessary quorum was present for all the meetings. The company holds the board meeting in compliance with law and the gap between two meetings did not exceed one hundred and twenty days during the FY 2022-23. The detailed agenda and notes thereon are sent to all the directors seven days in advance from the date of Board Meeting. The Managing Director appraised the Board on the overall performance of the Company at every Board Meeting. The Board reviews the performance of the Company and sets the strategy for future. The Board takes on record the actions taken by the company on all its decisions periodically.
MEETING OF INDEPENDENT DIRECTORS
During the financial year 2022-23, the meeting of Independent Director was held on 12th February, 2023 to review the performance of Non Independent Directors of the company.
In a separate meeting of independent directors, performance of non-independent directors, performance of the board as a whole and performance of the chairman was evaluated, taking into account the views of executive directors and non-executive directors. The same was discussed in the board meeting that followed the meeting of the independent directors, at which the performance of the board, its committees and individual directors was also discussed.
POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND OTHERDETAILS
The Company's policy on directors' appointment and remuneration and other matters provided in
Section 178(3) of the Act has been disclosed in the corporate governance report, which forms part of the Annual Report.
The Remuneration Policy of the company for Directors, KMP and Senior Management Employees are also available at the website of the company i.e. www.ekamleasing.com.
PECUNIARY RELATIONSHIP OR TRANSACTIONS OF THE NON-EXECUTIVE DIRECTORS (NED) AND DISCLOSURES ON THE REMUNERATION OF THE DIRECTORS
The NEDs have no pecuniary relationship except the sitting fees paid for the meeting of board of Directors/Committee.
The details regarding the remuneration of directors along with their shareholding are disclosed in Corporate Governance Report which forming part of this Annual Report.
FRAUDS REPORTED BY AUDITORS UNDER SUB-SECTION (12) OF SECTION 143 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT
During the year under review, there was no frauds reported by statutory auditors to Audit Committee and/or board under sub-section (12) of section 143 of the Companies Act, 2013.
BOARD EVALUATION
The board of directors has carried out an annual evaluation of its own performance and board committees. The performance was evaluated by the Board after seeking inputs from all the directors on the basis of the criteria such as the Board composition and structure, effectiveness of board processes, information and functioning etc.
The performance of the committees was evaluated after seeking the inputs of committee members on the criteria such as understanding the terms of reference, Committee Composition, Independence, updating the Board on the committee decisions, comprehensiveness in the discussion of issues and contributions to Board decisions, etc.
The Board and the Nomination and Remuneration Committee ("NRC") reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual directors to the Board and committee meetings like preparing on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the Chairman was also evaluated on the key aspects of his role. Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated. The evaluation report contains an executive summary of findings and several key recommendations from the evaluation process.
DETAILS OF APPLICATION MADE OR PROCEEDING PENDING UNDER INSOLVENCY AND BANKRUPTCY CODE 2016
During the year under review, there were no application made or proceeding pending in the name of Company under the Insolvency and Bankruptcy Code, 2016.
DETAILS OF DIFFERENCE BETWEEN VALUATION AMOUNT ON ONE TIME SETTLEMENT AND VALUATION WHILE AVAILING LOAN FROM BANKS AND FINANCIAL INSTITUTIONS
During the year under review, there has been no one time settlement of loans taken from banks and financial institutions.
COMMITTEES OF BOARD
Pursuant to requirement under Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors has constituted various Committees of Board such as Audit Committee, Nomination & Remuneration Committee, Stakeholders Relationship Committee. The details of composition and terms of reference of these Committees are mentioned in the Corporate Governance Report.
? AUDIT COMMITTEE
The composition, role, terms of reference, authority and powers of the Audit Committee are in conformity with Section 177 of the Companies Act, 2013 read with Regulation 18 of SEBI (Listing Obligations& Disclosure Requirements) Regulations, 2015. The Committee met periodically during the year and had discussions with the auditors on internal control systems and internal audit report.
? NOMINATION & REMUNERATION COMMITTEE (NRC)
The composition, role, terms of reference, authority and powers of the Nomination & Remuneration Committee are in conformity with Section 178 of the Companies Act, 2013 read with Regulation 19 of SEBI (Listing Obligations& Disclosure Requirements) Regulations, 2015.
? STAKEHOLDER RELATIONSHIP COMMITTEE (SRC)
The composition, role, terms of reference, authority and powers of the Stakeholder Relationship Committee are in conformity with Section 178 of the Companies Act, 2013 read with Regulation 20 of SEBI (Listing Obligation & Disclosure Requirements) Regulations, 2015.
The details regarding all the above said committees are given in the Corporate Governance Report which forms a part of this Report.
RELATED PARTY TRANSACTIONS
Policy on Related Party Transactions and the same is available on the website of the company at www.ekamleasing.com. All Related Party Transactions are placed before the Audit Committee and also the Board/Members for their approval, wherever necessary. An omnibus approval from the Audit Committee is obtained for the related party transactions. The details of the same are given in Note 29 and Note 28 respectively of the Standalone & Consolidated Financial Statements of the Company.
Further, there were no related party transactions which were material or not at arm's lengh basis as required under section 188(1) of the Companies Act and Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.There were no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company atlarge.Therefore , the requirement of Form AOC-2 is not applicable to the Company.
The Company in terms of Regulation 23 of the Listing Regulations submitted disclosures of related party transactions on a consolidated basis, in the format specified in the relevant accounting standards to the stock exchanges. The said disclosures can be accessed on the website of the Company at www.ekamleasing.com.
RISK MANAGEMENT
Effective risk management is essential to success and is an integral part of our culture. While we need to accept a level of risk in achieving our goals, sound risk management helps us to make the most of each business opportunity, and enables us to be resilient and respond decisively to the changing environment.
Our approach to risk management assists us in identifying risks early and addressing them in ways that manage uncertainties, minimize potential hazards, and maximize opportunities for the good of all our stakeholders including shareholders, customers, suppliers, regulators and employees. Risks can be broadly classified as Strategic, Operational, Financial, and Legal/Regulatory.
In accordance with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 Company has adopted risk management policy, approved by Board of Directors and established a risk management framework to identify, mitigate and control the risk and threatens of risk.
AUDITORS
Statutory Auditor
M/s Dooger & Associates, Chartered Accountant was appointed as the Statutory Auditor of the Company for the period of 5 years from 29th Annual General Meeting to 34th Annual General Meeting of the Company. Further, M/s Dooger& Associates, Chartered Accountant is eligible for re-appointment but the auditor gives his unwillingness to be re-appointed.
Therefore, the management has approached M/s MB Gupta & Associates, Chartered Accountants (FRN:006928N) for the appointment of Statutory Auditor of the Company and had received consent/affirmation letter along with his brief profile to act as Statutory Auditor of the Company.
Therefore, pursuant to the provisions of Section 139 and 142 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014 and other applicable provisions, if any, (including any statutory modification(s), clarifications, exemptions or re-enactments thereof for the time being in force) and pursuant to recommendation of the Audit Committee and subject to the approval of shareholders at the Annual General Meeting, M/s. MB Gupta & Co., Chartered Accountants (FRN.006928N), be and are hereby appointed as Statutory Auditors of the Company to fill the casual vacancy caused by the resignation of M/s. Dooger and Associates, Chartered Accountants (FRN.:000561N) from the conclusion of the meeting held on 11th August 2023 until the conclusion of the 30th Annual General Meeting at a fees as may be decided with mutual consent with the Board besides reimbursement of travelling and out of pocket expenses incurred.
Further, M/s. MB Gupta & Co., Chartered Accountants (FRN.006928N), be and are hereby appointed as Statutory Auditors of the Company for a term of five years to hold office from the conclusion of the 30th Annual General Meeting till the conclusion of the 35th Annual General Meeting in 2028, subject to approval of Members in the ensuing Annual General Meeting scheduled to be held on 27th September, 2023.
The necessary resolutions for appointment of M/s. MB Gupta & Co., Chartered Accountants (FRN.006928N) form part of the Notice convening the ensuing Annual General Meeting scheduled to be held on 27th September, 2023.
The Company has in its Notice convening Annual General Meeting sought approval from the Members for passing a resolution regarding authorizing the Board to appoint Statutory Auditor.
Secretarial Auditor
In terms of Section 204 of the Companies Act, 2013 and Rules framed there under and on the recommendation of the Audit Committee, the Board of Directors of the Company have appointed M/s. KKS & Associates, Company Secretaries as the Secretarial Auditor of the Company for the financial year 2023-2024. The Company has received consent from M/s. KKS & Associates, Company Secretaries, for their appointment. The Secretarial Audit Report confirms that the Company has complied with the provisions of the Act, Rules, Regulations and Guidelines and that there were no deviations or non-compliances. Further, his secretarial audit report is annexed as Annexure-V to this Report in prescribed Form MR-3.
Further, the Board of Directors in their meeting held on Friday, 11th August, 2023 re-appointed M/s. KKS & Associates, Company Secretaries, as Secretarial Auditors, to undertake the audit of the secretarial records for the Financial Year 2023-24.
Further, in pursuant to Regulation 24A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 as amended vide SEBI Circular No. CIR/CFD/CMD1/27/2019 dated February 08, 2019, the Annual Secretarial Compliance Report for the Financial Year ended on March 31, 2023 as issued by M/s. KKS & Associates, Company Secretaries is also available at BSE India.com and on the website of the Company i.e www.ekamleasing.com.
EXPLANATION OR COMMENTS ON QUALIFICATIONS OR RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS OR PRACTICISING COMPANY SECREATARY IN THEIR REPORT
The standalone financial statements of the Company have been prepared in accordance with Ind AS notified under Section 133 of the Act. The Notes to the financial statements referred in the Auditors Report are self-explanatory.
The statutory auditors of the Company mentioned the following qualifications in the Auditors Report of the Company for the financial year 2022-23:-
Qualified opinion given by auditor in standalone audit report:
a) Note No. 43 of the standalone financial statements, the company has recognized the total interest income amounting INR 55.45 Lakhs, which are related to accounts which are Non-performing Assets. As per Income recognition norms issued by Reserve Bank of India, the interest income is not allowed to recognize from Non-performing assets. Accordingly profit is overstated by INR 55.45 lakhs and simultaneously loans are overstated by INR 55.45 lakhs.
b) Pursuant to the provisions of section 203 of the Companies Act, the company is mandated to appoint the Chief Financial Officer (CFO), we draw attention to the fact that the Company is failed to appoint a Chief Financial Officer (CFO) throughout the year.
Management Response
a) These loans are pending since long time. During the year, the management after discussion with the borrower has restructured the loan on 01st October 2022.The management is of the view that all these loans are fully recoverable and there is no requirement to provide the provisions of the same.
b) Operations of the company are very nominal and also the company is facing financial difficulties. However, the management is confident that the vacancy of CFO shall be filled soon.
Qualified opinion given by auditor in consolidated audit report:
(a) Note No. 40 of the consolidated financial statements, the group has recognized the interest income amounting INR 55.45 Lakhs, which are related to accounts which are Non-performing Assets. As per Income recognition norms issued by Reserve Bank of India, the interest income is not allowed to recognize from Non-performing assets. Accordingly profit is overstated by INR 55.45 lakhs and simultaneously loans are overstated by INR 55.45 lakhs.
(b) Pursuant to the provisions of section 203 of the Companies Act, the holding company is mandated to appoint the Chief Financial Officer (CFO), we draw attention to the fact that the holding company is failed to appoint a Chief Financial Officer (CFO) throughout the year.
(c) In our opinion and according to the information and explanation given to us by the management in respect of two subsidiaries (Jet Air Securities Private Limited; Rex Overseas Private Limited) are required to get registered with Reserve Bank of India as a Non-Banking Finance Company under section 45-IA of the Reserve Bank of India Act, 1934 based on their business activity (50:50 test).
a) These loans are pending from long time. During the year, the management after discussion with the borrower has restructured the loan on 01st October 2022.The management is of the view that all these loans are fully recoverable and there is no requirement to provide the provisions of the same.
b) Operations of the company are very nominal and also the company is facing financial difficulties. However, the management is confident that the vacancy of CFO shall be filled soon. c) The above said subsidiaries were neither incorporated as NBFCs nor indented to carry NBFC activities. Further, in vew of insignificant business activities and due to interest income on loans the said observation is made by the auditor.The management is taking necessary steps to operationalise these subsidiaries and therefore is of the opinion that there is no requirement to apply for NBFC license.
The secretarial auditors of the Company mentioned the following qualifications in the Secretarial Auditor's Report of the Company for the financial year 2022-23:-
1. During the financial year for the quarters ended June, 2022 and September 2022 the Board Composition of the company was not in accordance with Section 149 of the Companies Act, 2013 and Regulation 17 of SEBI (LODR) Regulations, 2015 as amended from time to time as detailed hereunder: a) Mrs. Vandana Singh has resigned from the post of Women Director of the company w.e.f. 12th August, 2021 and the due date to fill the vacancy was 12th November, 2021. However, the vacancy of woman director of the company was filled up on 7th December 2022 with appointment of Mrs. Rashi Varshney as a Women independent Director (Non-Executive).
Delay/non-Appointment of KMPs
b) Mrs. Mahak has resigned from the post of the Company Secretary of the Company w.e.f 27th December, 2021 which was required to be filled till 27th March, 2022; However, there was delay to fill the vacancy and the vacancy was filled up on 07th December 2022 with the appointment of Ms. Neha as company secretary and compliance officer.
c) Mr. Amit Kumar Khetan has resigned from the post of Chief Financial Officer w.e.f May 02, 2022 and the vacancy has not been filed till the date.
2. As per Regulation 3(5), 3(6) of Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 states that the board of directors or head(s) of the organization of every person are required to handle unpublished price sensitive information shall ensure that a structured digital database is maintained.
3. As per Regulation 14 of SEBI (LODR) Regulations 2014, every listed entity shall pay all such fees or charges, as applicable, to the recognised stock exchange(s) upto 30th April 2022 which was paid with delay.
4. As per Regulation 76 of SEBI (Depositories & Participants) Regulation, 2018, company have to file the Reconciliation of share capital audit report within 30 days from the end of the quarter. However, the company delayed in submitting the reconciliation of share capital audit report for quarter ended on June 2022 and September 2022.
5. There were fines levied either by SEBI or by stock exchange in terms of Standard Operating Procedure (SOP) prescribed under SEBI Circular No. SEBI/HO/CFD/CMD/CIR/P/2020/12 dated 22nd January, 2020, vide email SOP-CReview-Feb 2022, SOP-CReview-(21 Feb 2022), SOP-review-(20 May 2022), SOP-CReview-June 2022 and SOP-Review-Aug 2022 vide email SOP reminder dated, June 6 2022, July 15 2022, September 1 2022, September 7 2022, November 7 2022, December 8 2022.
Management Reply:
1. a) The untimely and sad demise of its two directors, during the Covid pandemic period, Mr. Prakash Goyal (Independent Director) on 01/05/2022 and Mrs. Mamta Jain (Women Director-wife of promoter/MD) on 25/05/2021 and the Management including the MD/Promoter who was going through mental agony on business as well as personal front, was not able to fill the resultant vacancies within the prescribed time period and consequent non-compliance/improper Board Composition of the Board of Directors of the Company.
b) The pandemic situation disrupted business operations of the Company and the financial position got worse and therefore the management was not able to search the appropriate candidate to fill the resultant vacancy as Compliance Officer & Company Secretary of the Company.
c) Operations of the company are very nominal and also the company is facing financial difficulties. However, the management is confident that the vacancy of CFO shall be filled soon.
2. The Board is in process to make the compliance good.
3. For point no. 3,4 and 5, the company has made an application for waiver of fines against the above said fines imposed by BSE vide 6th March, 2023 and the said application for waiver is pending for consideration with BSE.
Internal Auditor
In compliance with section 138 of the Companies Act 2013, the Board of Directors on the recommendation of the Audit Committee has appointed M/s ACG & Co., Chartered Accountant as the Internal Auditor to conduct Internal Audit of the Company for Financial Year 2023-24.The internal auditor performs an independent check of effectiveness of key controls in identified areas of internal financial control reporting. The Internal Audit report for Financial Year 2022-23 was reviewed by the audit committee and taken note by the board of Directors of the company.
Internal Financial Control (IFC) means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business, including adherence to Company's policies, the safeguarding of its assets, timely prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.
The Internal auditor monitors and evaluates the efficancy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company and its subsidiaries.
Based on the report of Internal Auditor, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and the necessary corrective actions are presented to the Audit Committee. In addition, the company has identified and documented the key risks and controls for each process that has a relationship to the financial operations and reporting at regular intervals, internal teams test identified key controls.
CHANGE IN THE NATURE OF BUSINESS
There is no change in the nature of business of the company during FY 2022-23.
SHARE CAPITAL
The Board that pursuant to Circular No DOR.CRE.REC.No.60/03.10.001/2021-22 dated 22nd October 2021 issued by Reserve Bank of India (RBI), it has mandated under Scale Based Regulation (SBR), the Regulatory minimum Net Owned Fund (NOF) for all kind of NBFCs i.e. NBFC-ICC, NBFC MFI and NBFC-Factors, shall be increased to 10 crore. The following glide path isprovided for the existing NBFCs to achieve the NOF of 10 crore:
In view of above, with the objective to achieve the NOF requirement, the Company may be require infuse fresh equity fund also. Since the existing authorised and paid up share capital is Rs 3 cr, therefore it is proposed to increase the authorised share capital to Rs. 5 cr. to accommodate future Equity Capital.
Further, pursuant to the provisions of section 4,13, 15, 61 & 64 and other applicable provisions, if any, of the Companies Act, 2013 read with Rule 15 of Companies (Share Capital and Debentures) Rules, 2014 (including any statutory modification(s) or re-enactment thereof) and rules framed there under and in accordance with the applicable provisions of the Article of Association of the company, consent of the Board of directors subject to the approval of members of the company be and is hereby accorded to increase the authorized share capital of the company from Rs. 3,00,00,000 (Rupees three Crores only) divided into 60,00,000 (Sixty Lakh) equity shares of Rs. 5/- (Rupees Five) each to Rs. 5,00,00,000 (Rupees Five crores only) divided into 100,00,000 (One crore) equity shares of Rs. 5/- (Rupees five) each by creation of additional 40,00,000 (Forty lakhs) equity shares of Rs. 5/- (Rupees five) each and that the new equity shares shall rank pari-passu with the existing equity shares.
The Board of directors subject to the approval of members of the Company be and is hereby accorded for substituting the existing Clause V of Memorandum of Association of the Company by following clause as mentioned here under:
V. The Authorized Share Capital of the Company is Rs. 5,00,00,000/- (Rupees Five crores only) divided into 100,00,000 (One crore) equity shares of Rs.5/- (Rupees Five) each.
PUBLIC DEPOSITS
In pursuance of the Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014 the company has not accepted any public deposit during the year under review.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013
During the year under review, as per terms of section 134(3) (g) company has not given any loan or guarantee which is covered under the provision of Section 186 of the Companies Act, 2013. However, details of investments made during the year are given under notes to the financial statements.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Particulars required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, regarding conservation of energy, technology absorption and foreign exchange earnings and outgo.
Since the company is not engaged in manufacturing, the particulars in respect of conservation of energy, research and development, technology absorption are not required to be given.
CORPORATE GOVERNANCE REPORT AND CERTIFICATE
The company understands and respects its fiduciary role and responsibility towards its stakeholders and society at large, and strives to serve their interests, resulting in creation of value and wealth for all stakeholders.
The compliance report on corporate governance and a certificate from M/s. KKS & Associates, Company Secretaries (Prop. Mr. Krishna Kumar Singh, FCS No. 8493), Practicing Company Secretary of the Company, regarding compliance of the conditions of corporate governance, as stipulated under Chapter IV of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is attached herewith as integral part to this report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
As required by Regulation 34 (2) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a detailed Management Discussion and Analysis Report is presented in a separate section forming part of the Annual Report.
CONSOLIDATED FINANCIAL STATEMENTS
As stipulated by Regulation 33 of the Listing Regulations, the Consolidated Financial Statements have been prepared by the Company in accordance with the applicable Accounting Standards. The audited Consolidated Financial Statements, together with Auditors' Report, form part of the Annual Report.
As per the provisions of Section 129 of the Companies Act, 2013, the consolidated financial statements of the Company, its Subsidiaries and Associates are attached in the Annual Report. The annual accounts of Subsidiaries and Associates will be made available to shareholders on request and will also be kept for inspection by any shareholder at the Registered Office and Corporate Office of your Company. A statement in Form AOC-1 containing the salient features of the financial statements of the
Company's Subsidiaries, Associates and Joint Venture for the year ended March 31, 2023 is also attached with financial statements.
CORPORATE SOCIAL RESPONSIBILITY
The Company is not required to formulate Corporate Social Responsibility(CSR) Policy and Committee as it does not fulfill the criteria specified under Section 135 of the Companies Act, 2013.
ANNUAL RETURN
Pursuant to Section 92 and 134 of the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return is available on the website of the Company which can be accessed through www.ekamleasing.com.
COMPLIANCE WITH SECRETARIAL STANDARDS ON BOARD MEETINGS AND GENERAL MEETINGS
The Institute of Company Secretaries of India (‘ICSI') has currently mandated compliance with the Secretarial Standards on board meetings and general meetings, as revised w.e.f. October 1, 2017. The Company is duly complied with applicable secretarial standards read together with circulars issued by Ministry of Corporate Affairs for the Board Meetings and General Meetings conducted by company during the FY 2022-23.
COMPLIANCE WITH THE SEBI (LISTING OBLIGATIONS & DISCLOSURE REQUIREMENTS) REGULATIONS 2015
The company's equity shares continue to be listed on the Bombay Stock Exchange (BSE), Mumbai which has nationwide trading terminals. The company has paid the Annual Listing Fees to BSE for the Financial Year 2022-2023.
DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM/WHISTLE BLOWER POLICY FOR DIRECTORS AND EMPLOYEES
Pursuant to Section 177 of the Companies Act 2013 and Regulation 22 of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, the Board has adopted vigil mechanism in the form of Whistle Blower Policy for the Directors and Employees of the Company to deal with instances of fraud or mismanagement, if any. The Vigil Mechanism ensures standards of professionalism, honesty, integrity and ethical behaviour. The Company had adopted a Code of conduct for Directors and Senior
Management Executives ("the Code"), which lays down the principles and standards that should govern their actions. The Policy regarding the same can be accessed at the website of the company. All Senior Management personnel have affirmed compliance with the ELFCL Code of Conduct . The CEO & Managing Director has also confirmed and certified the same. The certification is at the end of the Report on Corporate Governance.
Pursuant to Section 177(9) of the Companies Act 2013, a vigil mechanism was established for directors and employees to report to the management instances of unethical behaviour, actual or suspected, fraud or violation of the Company's code of conduct or ethics policy. The Vigil Mechanism provides a mechanism for employees of the Company to approach the Chairman of the Audit Committee of Directors of the Company for redressal. No person has been denied access to the Chairman of the Audit Committee of Directors.
PARTICULARS EMPLOYEES PURSUANT TO SECTION 197 OF THE COMPANIES ACT, 2013 READ WITH RULE 5 (1) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014
There was no employee in receipt of remuneration in the limit as prescribed under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Therefore, the statement/ information required under section 197 read with Rule 5 is not applicable.
DISCLOSURE REGARDING MAINTAINANCE OF COST RECORD
The Company is not required to maintain the cost record as specified by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATOR OR COURTS OR TRIBUNAL IMPACTING THE GOING CONCERN STATUS
There are no significant and material orders passed by theRegulators or Courts or Tribunals impacting the going concernstatus and Company's operations in future.
There were fines levied against the listed entity/its promoters/directors/material subsidiaries either by SEBI or by Stock Exchanges (including under the Standard Operating Procedure issued by SEBI through various circulars) under the aforesaid Acts/Regulations and circulars/guidelines.
E-VOTING
The Company is providing e-voting facility to all members to enable them to cast their votes electronically on all resolutions set forth in the Notice. This is pursuant to section 108 of the Companies Act, 2013 and Rule 20 of the Companies (Management and Administration) Rules, 2014 and Regulation 44 of SEBI (Listing Obligations & disclosure Requirements) Regulations, 2015 read with the Ministry of Corporate Affairs General Circular Nos. 14/2020 dated 8th April, 2020, 17/2020 dated 13th April, 2020, 20/2020 dated 5th May, 2020, 02/2021 dated 13th January, 2021 and Circular No. 2/2022 dated May 5, 2022 and circular no. 10/2022 dated 28th December 2022 (‘MCA Circulars') and also the Circular dated 12th May, 2020, SEBI/HO/CFD/CMD2/CIR/P/2021/11 dated 15th Jaunary 2021, Circular No. SEBI/HO/CFD/CMD2/CIR/P/2022/62 dated 13th May, 2022 and Circular No. SEBI/HO/CFD/CMD2/POD-2/P/CIR/2023/4 dated January 05, 2023 issued by the Securities and
Exchange Board of India ("SEBI Circular"). The instruction(s) for "remote e-voting" and "e-voting" during the ANNUAL GENERAL MEETING for ensuing Annual General Meeting is also provided with notice to shareholders of this Annual Report.
PREVENTION OF INSIDER TRADING
The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate in securities by the Directors and designated employees of the Company. The Code prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Code of Conduct to regulate, monitor and report
Insider trading is uploaded on the Company's website: www.ekamleasing.com.
REPORTING OF FRAUDS
There was no instance of fraud during the year under review, which required the Statutory Auditors to report to the Audit Committee and/or Board under Section 143(12) of the Companies Act 2013and Rules framed there under.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMAN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company is committed for providing and promoting a safe and healthy work environment for all its employees.
In accordance with the provisions of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013 and the Rules framed there under for prevention and redressal of complaints of sexual harassment at workplace, along with a structured reporting and redressal mechanism. The Company has complied with provisions relating to the constitution of Internal Complaints Committee under the said Act.
There were no complaints regarding sexual harassment by any women employees (permanent, contractual, temporary, trainees) who are covered under this policy till the date of this report.
ACKNOWLEDGEMENTS
On behalf of the Directors of the Company, I would like to place on record our deep appreciation to our shareholders, customers, business partners, vendors, bankers, financial institutions and academic institutions for all the support rendered during the year.
The Directors are thankful to the Government of India, the various ministries of the State Governments, the Central and State Electricity Regulatory authorities, communities in the neighborhood of our operations, local authorities in areas where we are operational in India; as also partners, governments and stakeholders where the Company operates, for all the support rendered during the year.
The Directors regret the loss of life due to COVID-19 pandemic and are deeply grateful and have immense respect for every person who risked their life and safety to fight this pandemic.
Finally, we appreciate and value the contributions made by all our employees and their families for making the Company what it is. Your company's employees are instrumental to your company achieving higher business goals. Your directors place on record their deep admiration of the commitment and contribution of your company's employees. Your support as shareholders is greatly valued. Your directors thank you and look forward to your continuance support.