Your Directors have pleasure to present 39th Annual Report and Audited Annual Accounts of your
company for the year ended on 31st March 2024.
FINANCIAL HIGHLIGHTS:
STANDALONE BASIS
( Rs. IN LAKHS)
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Particulars
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FY 2023-2024
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FY 2022-23
|
|
Total Income
|
161.43
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Nil
|
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Total Expenditure
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164.91
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59.69
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Profit / (Loss) Before Tax
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(3.47)
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1.64
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PERFORMANCE REVIEW & FUTURE OUTLOOK:
Your Directors are confident that the policies, strategies adopted by your company will protect interest
of the stakeholders.
DIVIDEND & RESERVES:
In view of the losses, your Directors expresses it inability to declare dividend for the year.
SHARE CAPITAL:
As at March 31, 2024, Your company’s total paid up share capital stood at Rs.4,01,31,980/- divided
into 32,28,069 fully paid up equity shares of Rs.10/- each and 7,85,129 fully paid up preference
shares of Rs.10/- each. During the year under review, the Company has not issued any shares with or
without differential voting rights. Also company has neither issued employee stock options nor sweats
equity shares and does not have any scheme to fund its employees to purchase the shares of the
Company.
As on 31st March 2024, Mr. Rahul Shah, Promoter Director of the Company holds 43.11 % shares of
the Company.
MATERIAL CHANGES AND COMMITMENTS BETWEEN THE DATE OF THE BALANCE SHEET
AND THE DATE OF REPORT
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.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
A. Conservation of Energy and Technology Absorption:
The Company has no particulars to report regarding conservation of energy, technology
absorption as required under Section 134(3)(m) of the Companies Act, 2013 read with Rules
there under.
B. Foreign exchange earnings and outgo:
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Sr.
No.
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Particulars
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Amt in '
|
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1
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Foreign Exchange earned in terms of actual inflows during
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161.43
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| |
the year
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|
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2
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Foreign Exchange outgo in terms of actual outflows during
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Nil
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| |
the year
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CORPORATE SOCIAL RESPONSIBILITY (CSR)
Your company is committed to improve quality of lives of people in the community its serves through
long term stakeholder value creation, with special focus on skills development. The Company does
not have to mandatorily constitute a Corporate Social Responsibility (CSR) Committee in accordance
with Section 135 of the Companies Act, 2013. The company fully understands its role in society and is
committed for sustainable & inclusive growth of people & the environment around its business.
BOARD AND DIRECTORS EVALUATION AND CRITERIA FOR EVALUATION
During the year, the Board has carried out an annual evaluation of its own performance &
performance of the Directors.
Your Company has constituted Nomination and Remuneration Committee, which as per the
provisions of Companies Act 2013 has defined the evaluation criteria, procedure and time schedule
for the Performance Evaluation process for the Board, its Committees and Directors. The criteria for
Board Evaluation inter alia include degree of fulfillment of key responsibilities, Board structure and
composition, establishment and delineation of responsibilities to various Committees, effectiveness of
Board processes, information and functioning.
Criteria for evaluation of individual Directors include aspects such as attendance and contribution at
Board/ Committee Meetings and guidance/ support to the management outside Board/ Committee
Meetings. In addition, the Chairman was also evaluated on key aspects of his role, including setting
the strategic agenda of the Board, encouraging active engagement by all Board members and
motivating and providing guidance to the Management. Criteria for evaluation of the Committees of
the Board include degree of fulfillment of key responsibilities, adequacy of Committee composition
and effectiveness of meetings. The procedure followed for the performance evaluation of the Board,
Committees and Directors is detailed in the Directors’ Report.
CRITERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES AND
INDEPENDENCE OF DIRECTORS:
The Nomination and Remuneration Committee has formulated the criteria for determining
qualifications, positive attributes and independence of Directors in terms of provisions of Section
178(3) of the Companies Act 2013.
Independence:
In accordance with the above criteria, a Director will be considered as an ‘Independent Director’ if he/
she meet with the criteria for ‘Independent Director’ as laid down in the Act.
Qualifications:
A transparent Board nomination process is in place that encourages diversity of thought, experience,
knowledge, perspective, age and gender. It is also ensured that the Board has an appropriate blend of
functional and industry expertise. While recommending the appointment of a Director, the Nomination
and Remuneration Committee considers the manner in which the function and domain expertise of
the individual will contribute to the overall skill-domain mix of the Board.
Positive Attributes:
In addition to the duties as prescribed under the Act, the Directors on the Board of the Company are
also expected to demonstrate high standards of ethical behavior, strong interpersonal and
communication skills and soundness of judgment. Independent Directors are also expected to abide
by the ‘Code for Independent Directors’ as outlined in Schedule IV to the Act.
REMUNERATION POLICY
The Company has adopted a Policy for remuneration of Directors, Key Managerial Personnel and
other employees, which is aligned to its overall Human resource philosophy. The key factors
considered in formulating the Policy are as under:
(a) the level and composition of remuneration is reasonable and sufficient to attract, retain and
motivate Directors of the quality required to run the Company successfully;
(b) relationship of remuneration to performance is clear and meets appropriate performance
benchmarks; and
(c) remuneration to Directors, key managerial personnel and senior management involves a
balance between fixed and incentive pay reflecting short and long-term performance
objectives appropriate to the working of the Company and its goals.
The key principles governing the Company’s Remuneration Policy are as follows:
Remuneration for independent Directors and non-independent non-executive Directors:
• Independent Directors (‘ID’) and non-independent non-executive Directors (‘NED’) may be
paid sitting fees for attending the Meetings of the Board and of Committees of which they may
be members, and commission within regulatory limits, as recommended by the Nomination
and Remuneration Committee (‘NRC’) and approved by the Board.
• Overall remuneration should be reasonable and sufficient to attract, retain and motivate
Directors aligned to the requirements of the Company, taking into consideration the
challenges faced by the Company and its future growth imperatives. Remuneration paid
should be reflective of the size of the Company, complexity of the sector/ industry/ Company’s
operations and the Company’s capacity to pay the remuneration and be consistent with
recognized best practices.
• The aggregate commission payable to all the NEDs and IDs will be recommended by the
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 NRC will recommend to the Board the quantum of commission for each Director
based upon the outcome of the evaluation process which is driven by various factors
including attendance and time spent in the Board and Committee Meetings, individual
contributions at the meetings and contributions made by Directors other than in meetings.
• The remuneration payable to Directors shall be inclusive of any remuneration payable for
services rendered in any other capacity, unless the services rendered are of a professional
nature and the NRC is of the opinion that the Director possesses requisite qualification for the
practice of the profession.
Policy on Remuneration for Managing Director (‘MD’) / Executive Directors (‘ED’) / Key
Managerial Personnel (‘KMP’)/ rest of the Employees:
• The extent of overall remuneration should be sufficient to attract and retain talented and
qualified individuals suitable for every role. Hence remuneration should be market
competitive, driven by the role played by the individual, reflective of the size of the Company,
complexity of the sector/ industry/ Company’s operations and the Company’s capacity to pay,
consistent with recognized best practices and aligned to any regulatory requirements. Basic/
fixed salary is provided to all employees to ensure that there is a steady income in line with
their skills and experience.
• In addition, the Company provides employees with certain perquisites, allowances and
benefits to enable a certain level of lifestyle and to offer scope for savings. The Company also
provides all employees with a social security net subject to limits, by covering medical
expenses and hospitalization through re-imbursements or insurance cover and accidental
death and dismemberment through personal accident insurance. The Company provides
retirement benefits as applicable.
• In addition to the basic/ fixed salary, benefits, perquisites and allowances as provided above,
the Company provides MD/ EDs such remuneration by way of commission, calculated with
reference to the net profits of the Company in a particular financial year, as may be
determined by the Board, subject to the overall ceilings stipulated in Section 197 of the
Companies Act, 2013. The specific amount payable to the MD/ EDs would be based on
performance as evaluated by the NRC and approved by the Board.
• The Company provides the rest of the employees a performance linked bonus. The
performance linked bonus would be driven by the outcome of the performance appraisal
process and the performance of the Company.
Presently, no Directors or KMP of the Company is drawing any remuneration from the company
DIRECTORS’ RESPONSIBILITY STATEMENT
The directors report that:
i) In the preparation of the annual accounts, the applicable accounting standards have been
followed along with proper explanation relating to material departures.
ii) The Directors have selected such accounting policies and applied them consistently and
made judgments and estimates that 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 statement 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 this Act 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, 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
vi) 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 ON INDEPENDENT DIRECTORS
IJ
All the Independent Directors have given declarations that they meet the criteria of independence as
laid down under Section 149(6) of the Act. In the opinion of the Board, they fulfill the conditions of
independence as specified in the Act and the Rules made there under and are independent of the
management.
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
At present, your company does not have any Subsidiary, Joint Venture or Associates company.
POLICY ON PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT
WORKPLACE
The Company has zero tolerance for sexual harassment and has adopted a Policy on Prevention,
Prohibition and Redressal of Sexual Harassment at the Workplace, in line with the provisions of the
Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and
the Rules there under. The Company has not received any complaint of sexual harassment during the
financial year 2023-2024.
VIGIL MECHANISM/ WHISTLE BLOWER POLICY
The Company has adopted a Whistle Blower Policy, to provide a formal mechanism to the Directors
and employees to report their concerns about unethical behavior, actual or suspected fraud or
violation of the Company's Code of Conduct or ethics policy. The Policy provides for adequate
safeguards against victimization of employees who avail of the mechanism. It is affirmed that no
personnel of the Company have been denied access to the Audit Committee.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
No significant material orders have been passed by the Regulators or Courts or Tribunals which
would impact the going concern status of the Company and its future operations.
AUDITORS
(1) Statutory Auditors:
M/s. DMKH & Co., Chartered Accountants, Mumbai, are the statutory auditors of the Company and
hold office till the conclusion of the 44th Annual General Meeting (AgM) subject to ratification at each
intervening AGM. They have furnished a certificate, confirming consent and eligibility in accordance
with Section 139 read with Section 141 of the Act. Pursuant to the provisions of the Act and the Rules
made there under, it is proposed to ratify their appointment as the statutory auditors of the Company
till the conclusion of the next AGM. Members are requested to consider the ratification of their and
authorize the Board of Directors to fix their remuneration.
(2) Secretarial Auditors:
Pursuant to the provisions of Section 204 of the Act and The Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had
appointed M/s. Hardik Savla & Co, a Company Secretary in Practice to undertake the Secretarial
Audit of the Company for the year ended 31st March, 2024. The Secretarial Audit Report is annexed
to this report.
The Auditors' Report for the financial year ended 31st March 2024 contains following qualification,
reservation, adverse remark or disclaimer:
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Sr.
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Auditors qualification, reservation, adverse
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Board's comments
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No.
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remark or disclaimer
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(Auditors have given following remarks under
Standalone Audit Report “Emphasis of Matter”
para )
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1
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The Company being a listed Company, as per
Section 138 of Companies Act, 2013 read with
Rule 13 of Companies (Accounts) Rules, 2014,
Company is required to appoint Internal Auditor.
However the Company has not complied with
the same.
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Your Company shall make an appointment
of Internal Auditor in current year.
|
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2.
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The Company has not established its Internal
Financial Controls over financial reporting on
criteria based on or considering the essential
components of internal control stated in the
Guidance Note on Audit of Internal Financial
Controls over Financial Reporting issued by the
Institute of Chartered Accountants of India.
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Your shall engage a Chartered Accountant
for issuance of appropriate report on
Internal Financial Controls and basis that,
the qualification will be addressed.
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The Company has made provisions of Rs.
39,000 for professional tax in the current
financial year and Rs. 13,000 in the previous
year, but these amounts remain unpaid as of
31st March 2024. This non-payment could result
in penalties and interest liabilities that have not
been accounted for in the financial statements.
The Company has an outstanding TDS payable
amounting to Rs. 42,592, which has been
pending for over three years. Furthermore, TDS
on legal and professional fees amounting to Rs.
18,70,800 and rent amounting to Rs. 2,37,540
for the financial year 2023-2024, The interest
and penalties associated with these amounts
have not been recorded.
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Your Company has paid the TDS for
previous years which are available for credit
and set off for the TDS liability accrued.
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5
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the company has granted loan to DSR Infotech
Limited, which is non-compliance of Section 185
of the Companies Act, 2013.
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DSR Infotech Ltd was a subsidiary company
when such transaction had happened. As
on date, the DSR is not the subsidiary
company of N2N.
It is important to note that, all expenses of
the Company are currently paid out of the
loan amount refunded by DSR Infotech
Limited. The Listing Fees, payments to
Company Secretary and other expenses are
paid out of the Loan amount refunded by the
DSR Infotech Ltd.
Further, It is important to note that, the Loan
was standing before the commencement of
the Companies Act, 2013.
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6
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Balances of Debtors, Loans and Advances,
Secured & Unsecured Loans, Sundry
Creditors Others are subject to confirmation and
reconciliation and consequential adjustments
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Certain balances have been carried
forwarded since the Company was acquired
by Rahul Shah through Open Offer.
Basis principle of prudence, the Board of
Directors may write off such amounts from
the Books of Accounts.
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7
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The company is in Export sale of services
without payment of GST. The Company
exceeded the GST registration threshold in June
2023 but registered only in January 2024.
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Company didn’t have any Input Credit for
the said period, hence there has been no
adverse effect. All Shares of the Company
are export of IT Services and basis Letter of
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Consequently, Rs. 1,11,97,005/- of the Rs.
1,31,97,005/- turnover during this period was not
reported due to non-registration. This oversight
has resulted in the Company being unable to
claim the input tax credit refund for the GST
portion on expenses for these services.
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Undertaking (LUT) issued to GST
Department, all export sales of the
Company are GST exempted.
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The Secretarial Auditors’ Report for the financial year ended 31st March 2024 contains following
qualification, reservation, adverse remark or disclaimer:
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Sr.
No.
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Secretarial Auditors qualification, reservation,
adverse remark or disclaimer
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Board’s comments
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|
1
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The company has not published intimation &
results of quarterly results in newspaper as
required by SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015
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Your Company shall comply with the same
during the current year and henceforth.
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2
|
We would like to draw your attention, the
company has applied for re-adjudication of
Stamp Duty on account of merger of Leadsoft
softech Pvt Ltd with the Company as levied by
the Controller of Stamps, Mumbai
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Re-adjudication of Stamp Duty with
Controller of Stamps, Mumbai is under
process.
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3
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Independent Director
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Company is making efforts to appoint
Independent Directors on the Board of the
Company and reconstitute committees of
the Board
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4
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Other LODR Non-Compliances and
Suspension of Trading of Shares
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Company is expected to clear the dues of
BSE Limited towards Annual Listing Fees in
Q3 of FY 2024-2025.
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Mr. Nishant Upadhyay has bought to attention of Promoter Director the qualification remarks of the
Auditors in their Audit Report and requested to adopt urgently corrective steps to address such
qualification and emphasis of matters. The role of the Independent Director being honorary and
without remuneration and more of advisory in nature and has adopted steps within their purview to
address these qualifications.
LISTING ON STOCK EXCHANGES
The Equity Shares of your Company are listed only with BSE Limited. The listing fees for the financial
year 2024-2025 is unpaid.
SUSPENSION OF TRADING OF EQUITY SHARES OF THE COMPANY
Company could not pay dues to BSE Limited towards Annual Listing Fees. Your Board is confident
that by December 31,2024, the trading in equity shares of the Company resume.
CORPORATE GOVERNANCE
The Company is committed to maintain the highest standards of corporate governance and adhere to
the corporate governance requirements set out by SEBI. The certain regulations as to corporate
governance do not apply to the Company in Accordance with SEBI (LODR) Regulations 2015.
Accordingly, no separate section on Corporate governance is annexed.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
The Management Discussion & Analysis Report as required under regulation 34 of the SEBI (LODR)
Regulations, 2015 is annexed to this report.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENT UNDER SECTION 186
During the year, the Company has not given any loan or guarantee, or provided security, or has made
any investment which would be required to be reported under section 186 of the companies Act 2013.
The closing balances of investments which would be covered under Section 186 of the Companies
Act, 2013, are disclosed in the Schedule of Non-Current Investments/Loans given in the Financial
Statements.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED
TO IN SUB-SECTION (1) OF SECTION 188 OF THE COMPANIES ACT, 2013
The contracts or arrangements as covered u/s188 of the Companies Act 2013, is not entered into by
the Company. Hence, no particulars are being provided in Form AOC-2 as mandated pursuant to the
provisions of Section 134 of the Companies Act, 2013, read with Rule 8 (2) of the Companies
(Accounts) Rules, 2014.
THE EXTRACT OF ANNUAL RETURN
Extracts of Annual return in form MGT-9 as per the provisions of the Companies Act, 2013 is annexed
hereto and forms part of this report.
MANAGERIAL REMUNERATION / PARTICULARS OF EMPLOYEES
Your company has not paid any managerial remuneration during the period under review, therefore
no Disclosures in the Board Report as required under Rule 5 of Companies (Appointment &
Remuneration) Rules, 2014 is provided and further your Company also has not employed any person
at a remuneration in excess of the limit set out in the said Rules.
DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP) :
Your Board comprises of Mr Rahul Shah, Mr Tushar Shah and and Ms. Trupti Pandit.
Ms. Twinkle Upadhyaya acts as a Company Secretary of the Company. Mr. Tushar Shah and Ms.
Trupti Pandit are also designated as Key Managerial Personnel and CEO and CFO respectively .
BOARD AND COMMITTEE MEETINGS
Five Board Meetings were convened and held during the year i.e. on May 30, 2023, August 14, 2024,
September 7, 2023, November 14, 2024 and February 14, 2024. There have not been any instances
when recommendations of the Audit Committee were not accepted by the Board. The intervening gap
between the Meetings was within the period prescribed under the Act.
DETAILS OF DEPOSITS WHICH ARE NOT IN COMPLIANCE WITH THE REQUIREMENTS OF
CHAPTER V OF THE COMPANIES ACT, 2013:
Your Company has not accepted any fixed deposits covered under chapter V of the Companies Act,
2013 and, as such, no amount of principal or interest was outstanding on the date of Balance Sheet.
INTERNAL CONTROLS SYSTEMS AND ADEQUACY
The Company’s internal audit systems are geared towards ensuring adequate internal controls
commensurate with the size and needs of the business, with the objective of efficient conduct of
operations through adherence to the Company’s policies, identifying areas of improvement, evaluating
the reliability of Financial Statements, ensuring compliances with applicable laws and regulations and
safeguarding of assets from unauthorized use.
The Audit Committee along with Management oversees results of the internal audit and reviews
implementation on a regular basis.
ACKNOWLEDGEMENT
Your Directors wish to place on record their appreciation for the wholehearted and sincere co¬
operation the Company has received from its bankers and various Government agencies. Your
Directors also wish to thank all the employees for their co-operation.
By Order of the Board of Directors
Place: Pune
Date: Sept 7, 2024
TusharShah Rahul Shah
Director Director
DIN-01932018 DIN-01545609
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