DIRECTORS REPORT

To

The Members

RSD Finance Ltd.

Your Directors have pleasure in presenting their Fifty Second Annual Report and Audited Accounts of your Company for the year ended 31st March, 2015.

RESERVES:

The Company has transferred Rs. 42,65,818.00/- to the statutory reserves during the Financial Year 2014-15.

DIVIDEND;

Your Director’s regret for not recommending Dividend on Equity Shares and decided to retain the profits.

CONSERVATION OF ENERGY, TECHNOLOGICAL ABSORPTION, FOREIGN EXCHANGE EARNING & OUTGO:

Details of energy conservation is not applicable to the Company, no technology has been absorbed or imported by the Company and Foreign Exchange Earning & Outgo is NIL.

RESEARCH & DEVELOPMENT:

The Company has not incurred any sum in respect of Research & Development for any of its activity.

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 Company has also implemented several best corporate governance practices as prevalent globally. The report on Corporate Governance as stipulated under the Listing Agreement forms an integral part of this Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of corporate governance is attached to the report on Corporate Governance.

MATERIAL CHANGES

No Material changes and commitments have been occurred 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 reporting period.

EXTRACT OF ANNUAL RETURN:

Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12 (1) of the Companies (Management and Administration) Rules, 2014, the details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith.

DIRECTOR AND KEY MANAGERIAL PERSONNEL:

Mrs. Kawaljeet Dugal Kaur has resigned from the post of director with effect from 26.03.2015. The Board places on record its deep appreciation for the valuable contribution made by her during her tenure as Director of the Company.

The Board has approved the appointment of Mrs. Anureet Kaur with effect from 26th March, 2015. The Board has considered the recommendation of the Nomination and Remuneration Committee and Audit Committee regarding the said appointment.

The Company has appointed Mr. Rechan Chhabra as CFO of the Company as required under section 203 of the Companies Act, 2013.

Declaration by Independent Director:

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under section 149(6) of the Act and Clause 49 of the Listing Agreement with the Stock Exchanges.

Board Evaluation:

Pursuant to the provisions of Companies Act, 2013 and Listing Agreements, the Board has carried out an evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit Committee and Nomination and Remuneration Committee. The manner in which the evaluation has been carried out is mentioned in the Corporate Governance Report.

Remuneration Policy:

The Board has, on recommendation of the Nomination and Remuneration Committee formulated a policy for selection and appointment of Directors, senior managements and their remuneration. The details of the said policy are stated in the Corporate Governance Report.

Meetings:

The details of the number of Board Meetings and meetings of various Committees are given in the Corporate Governance Report. The intervening gap between the meetings was within the time period prescribed under the Companies Act, 2013.

Obligation of Company Under the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013.

The Company has ZERO Tolerance for Sexual Harassment at workplace and has adopted a policy on prevention of Sexual Harassment of Women at workplace. There were no complaints received during the year. Further the Board extends its full responsibility to manage and act promptly in such cases.

Human Resources

Our Company treats its “human resources” as one of its most important assets.

Our Company continuously invests in attraction, retention and development of talent on an ongoing basis.

A number of programmes that provide focused people attention are currently are under way. Our Company thrust is on the promotion of talent internally through job rotation and job enlargement.

Transfer of amounts to Investor Education and Protection Fund

Your Company did not have any funds lying unpaid or unclaimed for a period of Seven Years. Therefore, there were no funds which were required to be transferred to Investor Education and Protection Fund (IEPF) as required by statutory provisions.

Audit Committee:

The Audit Committee comprises Independent Directors namely Mr. Sushil Kumar Khowala (Chairman) and Mr. Malkeet Singh Saini and Mr. Rajeev Singh Dugal as other members. All the recommendations made by the Audit Committee were accepted by the Board. More details on the Committee are given on the Corporate Governance Report.

DIRECTORS RESPONSIBILITY STATEMENT:

In terms of Section 134 (5) of the Companies Act, 2013 with respect to Directors’ Responsibility Statement, it is hereby confirmed:

(a) That in the preparation of Annual Accounts, the applicable Accounting Standard has been followed.

(b) That 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 financial year and the Statement of Profit and Loss for that period.

(c) That the Directors have taken proper and sufficient care for maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding assets of the Company and for preventing and detecting frauds and other irregularities.

(d) That the Directors have prepared the Annual Accounts on 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.

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

DETAILS PERTAINING TO REMUNERATION AS REQUIRED UNDER SECTION 197(12) OF THE COMPANIES ACT, 2013 READ WITH RULE 5(1) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014.

(i) The percentage increase in remuneration of each Director, Chief Financial Officer and Company Secretary during the financial year 2014-15, ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the financial year 2014-15 and the comparison of remuneration of each Key Managerial Personnel (KMP) against the performance of the Company are as under:

(ii) The median remuneration of employees of the Company during the financial year was Rs.149909/-

(iii) There were 9 permanent employees on the rolls of Company as on March 31, 2015;

(iv) There is no change in remuneration of Managing Director and performance of the Company decreased by 89.48% to Rs. 2.13 Crores in 2014-15 (20.25 Crores in 2013-14).

(v) PE Ratio of the Company is not ascertainable as the Shares of the Company are not traded in Market.

(vi) The key parameters for the variable component of remuneration availed by the directors are considered by the Board of Directors based on the recommendations of the Human Resources, Nomination and Remuneration Committee as per the Remuneration Policy for Directors, Key Managerial Personnel and other Employees.

(vii) The ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year – Not Applicable

(viii) It is hereby affirmed that the remuneration paid is as per the as per the Remuneration Policy for Directors, Key Managerial Personnel and other Employees.

(ix) Mr. Rajeev Singh Dugal appointed as Managing Director for a period of Five Years since 04.07.2015 with a monthly remuneration of Rs. 1 Lakh (Rs. 1,00,000/-).

RELATED PARTY TRANSACTION:

All Related Party Transactions that were entered into during the financial year were on arm’s length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the Company at large. Your Directors draw attention of the members to Notes to the financial statement which sets out related party disclosures.

Accordingly, particulars of contracts or arrangements with related parties referred to in section 188(1) along with the justification for entering into such contracts or arrangements in Form AOC-2 does not form part of the report.

SUBSIDIARY COMPANY:

PRECISIOM AUTOMOTIVE PRIVATE LIMITED is a subsidiary Company of RSD Finance Limited.

CODE OF CONDUCT:

The Company has a Code of Conduct which is applicable to directors and management personnel of the Company. The Company believes in conducting business in accordance with the highest standards of business ethics and complying with applicable laws, rules and regulations.

The Code lays down the standard procedure of business conduct which is expected to be followed by the directors and management personnel in their business dealings and in particular on matters relating integrity in the work place, in business practices and complying with applicable laws etc.

All the directors and management personnel have submitted declaration confirming compliance with the code.

BONUS ISSUE:

The Company has not allotted any bonus Shares during the year.

ISSUE OF SHARES:

During the Financial year ended 31st March, 2015:

i) The Company has not granted any Employees Stock Option.

ii) The Company has not issued any Sweat Equity Shares.

iii) The Company has not issued any equity shares with differential rights.

PUBLIC ISSUE:

During the year under review your Company has not issued any securities to the public.

PUBLIC DEPOSIT:

During the Year the Company has not accepted any Deposit from the Public, within the meaning of section 73 of the Companies Act, 2013.

PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND SECURITIES PROVIDED

Particulars of Loans given, Investments made, Guarantees given and Securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient are provided in the financial statement.

RISK MANAGEMENT POLICY:

Pursuant to section 134(3) (n) of the Companies Act, 2013, the Board of directors of the Company has adopted a Risk management Policy of the Company. The Company manages, monitors and reports on the principal risks and uncertainties that can impact its ability to achieve its strategic objectives.

The Company has introduced several improvements to Integrated Enterprise Risk Management, Internal Controls Management and Assurance Frameworks and processes to drive a common integrated view of risks, optimal risk mitigation responses and efficient management of internal control and assurance activities.

This integration is enabled by all three being fully aligned across Group wide Risk Management, Internal Control and Internal Audit methodologies and processes.

VIGIL MECHANISM/WHISTLE BLOWER POLICY:

The Company promotes ethical behavior in all its business activities and has put in place a mechanism for reporting illegal or unethical behavior. The Company has a Vigil mechanism and Whistle blower policy under which the employees are free to report violations of applicable laws and regulations and the Code of Conduct. The reportable matters may be disclosed to the Ethics and Compliance Task Force which operates under the supervision of the Audit Committee. Employees may also report to the Chairman of the Audit Committee. During the year under review, no employee was denied access to the Audit Committee.

PREVENTION OF INSIDER TRADING:

The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The Code requires preclearance for dealing in the Company’s shares and 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.

All the Board of Directors and designated employees have confirmed compliance with the Code.

INTERNAL FINANCIAL CONTROLS:

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

During the year the company appointed Mr. Rechan Chhabra, as an internal auditor.

The firm is authorized by the Audit Committee to access the adequacy and compliance of internal control process, statutory requirements etc. The Audit Committee met regularly to review reports submitted by the Internal Auditor. The Audit Committee upon discussion with internal auditor set up applicable control measures for the Company.

STATUTORY AUDITORS:

M/S MANISHA GUPTA & ASSOCIATES., Statutory Auditors of the Company, hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. They have confirmed their eligibility to the effect that their re-appointment, if made, would be within the prescribed limits under the Act and that they are not disqualified for re-appointment. The Notes on financial statement referred to in the Auditors’ Report are self-explanatory and do not call for any further comments. The Auditors’ Report does not contain any qualification, reservation or adverse remark.

SECRETARIAL AUDITOR:

Pursuant to provisions of section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the company has appointed Mr. Sital Prasad Swain, a whole time Company Secretary in practice having Membership No. F6338 & CP No - 6814, to undertake the Secretarial Audit of the Company. The Secretarial Audit Report for the financial year ended March 31, 2015 is annexed herewith to this Report. The Secretarial Audit Report does not contain any unexplained qualification, reservation or adverse remark.

APPRECIATION

For and on behalf of the Board, the Directors wish to place on record their sincere appreciation for the positive co-operation received from Banks, SEBI, Shareholders, RTA, farmers and Traders , and all the staffs of the Company during the year.

For and on behalf of the Board

Sd/- Rajeev Singh Dugal  

Chairman

Dated: 30th May, 2015  

Place: Kolkata