001
CONTENTS
Page No.
1 Director’s Report 03 - 21
2 Independent Auditor’s Report 22 - 27
3 Balance Sheet 28
4 StatementofProfitandLoss 29
5 Cash Flow Statement 30
6 Notes to the Financial Statements 31 - 48
002
BOARD OF DIRECTORSMr. Harsha Raghavan
Mr. Sumit Maheshwari
Mr. Sanjay Kaul
Mr. Deviinder Gupta
STATUTORY AUDITOR
M/sBSR&Co.LLP
Chartered Accountants
(Registration No. 101248W/ W-100022)
LodhaExcelus,1stFloor,
ApolloMillsCompound,
N.M.JoshiMarg,Mahalakshmi,
Mumbai – 400 011.
REGISTERED OFFICE
GayatriTowers,2ndFloor,
954,AppasahebMaratheMarg,
Prabhadevi,Mumbai–400025.
CORPORATE OFFICE
IFFCOTower,Tower-1,
B-wing,5thFloor,
Sector-29,Gurgaon,
Haryana – 122 001.
003
Director’s Report
To,
TheMembers,
Your Directors have pleasure in presenting their First Annual Report on the business and operations of the Company and the accounts for the Financial Year ended March 31st,2016.
1. Financial summary or highlights/Performance of the Company
I. FINANCIAL SUMMARY
Particulars 1st April, 2015 to 31st March,
2016(INR in
Thousands)
1st April, 2014 to 31st
March, 2015(INR in
Thousands)
Total Income 3,699.58 4,870.20
Expenditure 10,561.55 4,667.97
ProfitbeforeDepreciation,FinanceChargesandTax
(6,861.97) 202.23
Interest and Finance Charges 0.00 0.00
Depreciation 63.62 33.81
ProfitbeforeTax (6,925.59) 168.42
Taxespaidandprovided (851.19) 18.00
ProfitafterTax (6,074.40) 150.42
Balance brought forward from previous Year
(952.25) (1,102.68)
Balance carried to Balance Sheet (7,026.65) (952.26)
II. OPERATIONAL PERFORMANCE:
• Revenue from operations decreases by24.04%toINR3,699.58thousand.
• Net Profit / (Loss) of the Company is INR(6,074.40)thousand.
III. DIVIDEND The Company has incurred losses during this
year. Hence the directors do not recommend any dividend during the year under review.
IV. RESERVES No amount has been transferred to reserves.
2. Brief description of the Company’s working during the year/State of Company’s affair
OverviewThere was a change of management of the companyfromTGFinancePrivateLimitedtoNCMLFinancePrivateLimited.Thechangewasaffectedafter obtaining NOC from the Reserve Bank ofIndia. With the change of management, thedirectors and name of the company was changed and the new name of the company was given as NCMLFinancePrivateLimited(Nfin).
The Following approvals from RBI and RoC were putinplacetoeffecttheabovechanges:
CertificateofRegistrationNo.ofRBIis–N-13.01984,Dt. 14.02.2011.
LetterNo.ofNOCforNameChange–DNBS.MRO.CMD.2056/13.20.105/2015-16 dated 04.01.2016
LetterNo.ofRBI’sapprovalforChangeinControl– DNBS.MRO.CMD.2035/13.20.105/2015-16 dated 31.12.2015.
A formal launch of NCML Finance was made byNABARDChairman,Mr.HarshKumarBhanwalaon29th March 2016. The event was well attended by variousstakeholders.
Change of management
There was a change in management in the erstwhile TGFinancewhichwasrenamedasNCMLFinancePvt. Ltd. (Nfin). NCML bought a 100% shares of the company to become its new shareholder and subsequently the directors in the company were changed.
The following are the current directors of the company
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• Mr. Sanjay Kaul,ManagingDirector&CEO,NCMLFinance(ExIAS)
• Mr. Harsha Raghavan,ManagingDirector&CEO,FairbridgeCapitalPrivateLimited
• Mr. Sumit Maheshwari, Vice President,FairbridgeCapitalPrivateLimited
• Mr. Deviinder Gupta, Managing Director & CEO,NCMLFinance
Change in shareholding
The shareholding in the company prior to 12th February 2016 was
AuthorisedCapital: INR2cr.
Paid-upCapital: INR1.48cr.
Numberofshares: 14,83,855Shares
Asat11Feb2016:
Shareholders Number of shares
% holding
Transgoblal Securities Ltd
2,59,606 17.6%
Sunil Gupta 1,68,500 11.4%
Sushil Gupta 1,68,500 11.4%
Deepali Gupta 1,42,700 9.6%
Pushpa Gupta 1,39,855 9.4%
Suman Gupta 1,93,500 13.0%
Sushil Gupta HUF 1,37,200 9.2%
Sunil Gupta HUF 1,37,200 9.2%
S M Gupta HUF 1,36,794 9.2%
Total O/S shares 14,83,855 100%
As at 20thMay,2016/CurrentHoldings:AuthorizedCapital:INR45cr.Issued/Subscribed/Paidupcapital:INR36.48cr.Numberofshares:3,64,83,090Shares
Number of shares
% holding
NCML 36,483,090 99.99991%
Sanjay Kaul 10 0.00003%
Deviinder Gupta 10 0.00003%
SarikaSaxena 10 0.00003%
Total O/S shares 36,483,120.00 100%
Technology Platform
• The company has built a unique risk basedtechnology platform where the loan values are appraised and margins calculated on real timevalueofcommoditiesbasedonitsvariety,grade,mandiandvolatility.
○ The company follows the maker checkerand dual sanction matrix for all creditapprovals
○ Variousboardapprovedcreditcommitteeshave been set up to authorize loans
○ Allcommoditiesandlocationsareapprovedby the Commodity Credit Committee (CCC)
• Strategictieups:
○ Nfinhas tied up with UIDAI for getting real timee-kycforitsborrowers.Thefieldstaffwill be provided with tabs equipped with irisandbiometricscannerstogetthee-kycdone within minutes
○ The technology platform has a host tohostintegrationwithHighmark(oneofthe 4 approved CIC’s) to be able to generate the credit report of a borrower almost simultaneouslywiththee-kyc
○ Togettheborrowersdigitalsignaturesontheloandocuments,NfinhastiedupwithagovernmentSPV-CSCeGovernance.Thiswilleliminate the need for physical signatures and thereby reduce the incidence of non-enforceability of legal documents
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○ The companyhas also initiateddiscussionwith NABARD for strategic partnership with itsnetworkofKisanClubsandFPOs.The company is also focusing on social mediaandhastakeninitiatives like joiningWhatsapp groups of mandi traders. The Company has further initiated discussions withmultiplebankstosourcecreditlinesinline with its strategic plan.
Professional Staff
The following are the key members of the Nfinteam:
1. Mr.DeviinderGupta,MD&CEO
2. Ms.SarikaSaxena,HeadProducts
3. Mr.ShivSoni,HeadCreditandOperations
4. Mr. Muktesh Pareek, Head BusinessDevelopment
5. Mr.ShashankOmar,DeputyManagerFinance
Products
The company has started booking loans underthe WRF (warehouse receipt finance) product in Madhya Pradesh, Bihar, Gujarat etc. areas. The products already funded are wheat, chili,Chana, Mustard, maize, barley etc. the currentharvest season.
3. Change in the nature of business, if any
With the changes in management the business model of the company has undergone a paradigm shift. The Company is now focused on post-harvest funding in the rural/agri domain. The company is focused on leveraging the strong brandof itsparent,NCMLalongwith itsphysicalpresence across the country. The Company has decided to focus on following four products in the year 2016-17.
• WarehouseReceiptFunding(WRF) • DematCommodityFunding • LoanagainstProperty • Rentdiscounting
The Initial focuswill be on the flagship product,WRF. This product will be funded against e WHR issued by NCML in the first year. Thereafter,the other products will be launched in a phased manner.
The Company has come out with an innovative approach to funding in the rural/agri domain where the strategic objective is to have an ability to fund agri commodities in two hours of issue of e WHR. In order to achieve the strategic objective companyhastiedupwithmultiplestakeholderstodeliver the Digital lending platform. The Company has tied up with Jayam Solutions for developing the LOS/LMS system, UIDAI and CSC an SPV ofDepartment of IT and telecommunication for e KYC andeSign,StockHoldingCorporation(SHCIL)forestamppapersandfewbanksforedisbursements.Weunderstand thatbuildingof aDigital LendingplatformandissuanceofeWHRisafirstofitskindinitiative in the country.
The initial response has been quite encouraging as the company has got response from various segments like farmers, traders and aartiyas. AtotalamountofRs.5.09cr.hasbeendisbursedtill May 20, 2016. These disbursements havehappened across states like Andhra Pradesh,Gujarat and Madhya Pradesh for Chilies, Wheat,Green gram and Chana. The Company has built a healthy pipe line from the entire post-harvest value chain. As onMay 20th, 2016, total numberof34sanctionsamountingtoapprox.Rs.34.73cr.have been done and these cover additional states ofBihar,Rajasthan,MaharashtraandUPandnewcommodities like Maize, Barley, Guar and Guarseed. An amount of Rs. 6.6 lakhs has also beenrecovered on account of processing fee.
TheticketsizeofloanshasrangedfromINR3lakhsto Rs. 1 Crore thus covering the entire gamut of retail funding in the post-harvest value chain.
4. Deposits
Board of directors of have passed a resolution dated 16th June 2015, not to accept any depositsas per the compliance with RBI guidelines as per MasterCircular-“Non-BankingFinanceCompanies
6
Acceptance of Public Deposit (Reserve Bank)Directions, 1998” on Non-applicability of theDirectionstocertaintypesofnon-bankingfinancialcompanies.
5. Statutory Auditors
M/sBSR&Co.LLP,CharteredAccountants,Mumbai,(Firm’s Registration No. 101248W/W-100022),Statutory Auditors of the Company hold officeuntil the conclusion of the ensuing Annual General Meeting and being eligible offer themselves for re-appointment.
M/sBSR&Co.LLP,havefurnishedacertificate,confirming that if re-appointed, their re-appointment will be in accordance with Section 139 readwithSection 141of theAct.Pursuant tothe provisions of the Act and the Rules made there under,itisproposedtoreappointM/sBSR&Co.LLP,asthestatutoryauditorsoftheCompanyfromthe conclusion of the forthcoming AGM till the conclusionofthenextAnnualGeneralMeeting.
6. Auditor’s Report
Report of Statutory Auditors of the Company is self-explanatory and does not call for separateexplanationfromtheBoard.
7. Share CapitalA) Issueofequityshareswithdifferentialrights
The Company has not issued equity shares withdifferentialrightsduringtheyearunderreview.
B) Issue of sweat equity shares
The Company has not issued sweat equity shares during the year under review.
C) Issueofemployeestockoptions
TheCompanyhasnotissuedemployeestockoptions during the year under review.
D) Provision of money by company for purchase of its own shares by employees or by trustees forthebenefitofemployees
Not Applicable
8. Extract of the annual return
Pursuant to Section 92 (3) of the Act and Rule12 (1) of The Companies (Management and Administration)Rules,2014,theextractofAnnualReturninformMGT.9isannexedasAnnexureA.
9. Directors• Changes in Directors and Key Managerial
Personnel
Thedirectorshavechangedduringtheyear:
Old directors Current directors
Mr. Sunil Gupta Mr. Harsha Raghavan
Mr. Sushil Gupta Mr. Sumit Maheshwari
Mr. Sanjay Kaul
Mr. Deviinder Gupta
• DeclarationbyanIndependentDirector(s)andreappointmentifany:None
• FormalAnnualEvaluation:None
10. Number of meetings of the Board of Directors:
The Board of Directors of T G Finance Private Limited had met 9 times during the year underreview:
Date of the meeting No. of Directorsattended the meeting
20/05/2015 2
03/07/2015 2
29/09/2015 2
30/09/2015 2
21/10/2015 2
30/11/2015 2
12/01/2016 2
11/02/2016 2
12/02/2016 2
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The Board of Directors of NCML Finance PrivateLimited had met 3 times during the year underreview:
Date of the meeting No. of Directorsattended the meeting
12/02/2016 4
21/03/2016 4
29/03/2016 4
11. Particulars of contracts or arrangements with related parties
AgreementshavebeensignedwithNCML(parent)for the sub-leasing the premises for corporate office.
12. Risk management policy
A risk management policy is under development,howevermanyoftheriskshavebeenmitigatedorareunder mitigation on the digital technology platform as enumeratedhereunder:
Operational risk is mitigated because of followingenablersonthedigitallendingplatform:
• eKyc:Biometric recognitionensuresKYCbeingtakenfortherightperson
• Geotagginglocation:Mitigatesthatborrowerisnot being traceable because of wrong address being recorded a reason of NPA in industry is obviated.
• thecreditscoreoftherightpersonisbeingtakento ensure the borrower’s credit worthiness
• e Signature: Signatures put through bio metricensures the signatures on loan documents are not forged
• e Stamping: Ensures that documents areenforceable in case of default as e Stamping will ensure that documents are adequately and properly stamped through e Sign
• eWHR:PreventsfraudulentWHRbeingfunded.Also pledge and release of WHR on creation and closure of loan is seamless
• eDisbursement:Ensuresthattheloanproceedsare going to the correct borrower
• Shelf life of commodities: Prevents loan beinggiven for period higher than the shelf life of commodity minus the period since harvest period lapsed at the time of loan application
CreditRiskismitigatedbecauseoffollowingenablersonthedigitallendingplatform:
• eCIC:CICisanRBIrecognisedCreditInformationCompany with whom an integration is done which will ensure that immediately after e Kyc a e-CIC is done which will ensure that borrower credit history is generated.
• Dedupe:HardcodingofRBIdefaulterlist,terroristlist and subsequently internal defaulters list will ensure that delinquent borrowers are not lent to.
• LTV:BasedonfiveyearsVar,Modalvalue,Currentprice,Outlookpricethe loantovalue isarrived.This formula has been back tested for 5 yearsshowingbasedonthisLTVtherewillbenomargincall happening.
• Margining: Pre margin call on 25% erosion ofmargin and final margin call on 50% marginerosion. Final commodity sale will happen on the fourthdayofthefinalmargincall
• Liquidation:NCMLworking as liquidation agentfacilitating timely liquidation of commodity in case of margin or default.
Commodity Risk is mitigated because of followingenablers:
• SystemcalculatedandLTVandmargining
• NCML working as collateral manager whichis working for 57 banks/NBFC’s and havingmanagedassetsworthover INR100,000croressince inception
• While part disbursement is happening oncommodity arrival and receipt of e WHR full disbursement as per LTV happens only onconfirmationofquality.
• BoardconstitutedCommodityCreditCommitteetaking decisions on commodities to be funded,final LTV and locations where commodity isfunded etc.
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13. Director’s Responsibility Statement
The Directors’ Responsibility Statement referred to in clause (c) of sub- section (3) of section 134 of theCompaniesAct,2013,statesthat-
a) In the preparation of the annual accounts,the applicable accounting standards had beenfollowedalongwithproperexplanationrelating 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 ofthecompanyattheendofthefinancialyear andoftheprofitandlossofthecompanyforthat period.
c) Thedirectorshadtakenproperandsufficientcare for the maintenance of adequate accounting records in accordance with the provision of this Act for safeguarding the asset 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 and
e) The directors had devised proper systems to ensure compliance with the provision of all applicable laws and that such systems were adequate and operating effectively.
14. Acknowledgements
TheDirectorsexpresstheirsincerethankstoNCMLand Fairfax India holding Corporation for theirsupport in formation of the company. The Directors would also like to express their appreciation forthesupportprovidedbyvariousHeadsofNCML. TheDirectorsfurtherexpresstheirappreciationforthe outstanding professionalism and commitment exhibited by the company’s employees andconsultants.Finally,theDirectorswishtoexpresstheir acknowledgement for the support andguidance received from the regulators.
For and on behalf of the Board of DirectorsNCML Finance Private LimitedCIN:U67190MH2009PTC191081
_____________________ _____________________________________
Mr. Sanjay Kaul Mr. Deviinder Gupta Chairman MD&CEO DINNo.:01729695 DINNo.:00619149 Place:Mumbai Place:Istanbul Date:28May,2016 Date:28May,2016
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Annexure AFormNo.MGT-9
EXTRACT OF ANNUAL RETURNas on the financial year ended on 31st March 2016
[Pursuant to section92(3)oftheCompaniesAct,2013andrule12(1)oftheCompanies (Management andAdministration) Rules,2014]
I. REGISTRATION AND OTHER DETAILS:
U67190MH2009PTC191081CIN
20/03/2009Registration Date
NCMLFinancePrivateLimitedName of the Company
Company limited by sharesCategory / Sub-Category of the Company
2ndFloor,GayathriTowers,954, AppasahebMaratheMarg,Prabhadevi,Mumbai
Addressoftheregisteredofficeandcontactdetails
NoWhether listed company
NAName,AddressandContact details of Registrar and TransferAgent, ifAny
II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY (All the business activities contributing 10 % or more of the total turnover of the company shall be stated)
SN Name and Description of main products / services
NIC Code of the Product/service
% to total turnover of the company
1. Non-BankingFinancialServices 64990 100
10
III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES [No. of Companies for which information is being filled]
S. N0
NAME AND ADDRESS OF THE COMPANY
CIN/GLNHOLDING/
SUBSIDIARY / ASSOCIATE
% OF SHARE-
HOLDING
APPLI-CABLE
SECTION
1 National Collateral Management Services Limited
U74140MH2004PLC148859 HOLDING(FROM
11.02.2016)
99.99% 2(46)
2 Ornate Universal DevelopersPvt.Ltd.
U45300WB2003PTC097448 ASSOCIATE(TILL
11.02.2016)
0.00% 2(6)
3 Ornate Buildcon Developers
- ASSOCIATE(TILL
11.02.2016)
0.00% 2(6)
4 Ornate Infra Holdings Pvt.Ltd.
U45200WB2011PTC167621 ASSOCIATE(TILL
11.02.2016)
0.00% 2(6)
5 BoosterDealersPvt.Ltd. U45200WB2010PTC150182 ASSOCIATE(TILL
11.02.2016)
0.00% 2(6)
6 RiteDevelopersPvt.Ltd. U45201MH2002PTC134760 ASSOCIATE(TILL
11.02.2016)
0.00% 2(6)
7 Rita Ornate Developers - ASSOCIATE(TILL
11.02.2016)
0.00% 2(6)
8 PeculiarMetalPvt.Ltd. U27100MH1999PTC122910 ASSOCIATE(TILL
11.02.2016)
0.00% 2(6)
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IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)
A) Category-wise Share Holding
Category of Shareholders
No. of Shares held at the beginning of the year [As on 31st March 2015]
No. of Shares held at the end of the year [As on 31st March 2016] %
Change during
the year Demat Physical Total% of
Total Shares
Demat Physical Total% of
Total Shares
A. Promoter’s
(1) Indian
a) Individual/ HUF NIL 8,13,055 8,13,055 54.79% NIL 30 30 0.002% -99.99%
b) Central Govt NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
c) State Govt(s) NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
d) Bodies Corp. NIL 2,59,606 2,59,606 17.50% NIL 14,83,825 14,83,825 99.99% 82.50%
e)Banks/FI NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
f) Any other NIL 4,11,194 4,11,194 27.71% NIL NIL NIL 0.00% 0.00%
Total shareholding of Promoter (A) NIL 14,83,855 14,83,855 100% NIL 14,83,855 14,83,855 100 % NIL
(2) Foreign
(a) NRIs -Individuals NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
(b) Other –Individuals NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
(c) Bodies Corp. NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
(d)Banks/FI NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
(e) Any Other... NIL NIL NIL 0.00% NIL NIL NIL 0.00% NIL
Sub-total (A) (2): - NIL NIL NIL NIL NIL NIL NIL 0.00% NIL
Totalshareholding ofPromoter (A)=(A)(1)+(A)(2)
NIL 14,83,855 14,83,855 100% NIL 14,83,855 14,83,855 0.00% -100%
B. Public Shareholding
1. Institutions
a) Mutual Funds NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
b)Banks/FI NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
c) Central Govt NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
d) State Govt(s) NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
e)VentureCapitalFunds NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
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Category of Shareholders
No. of Shares held at the beginning of the year [As on 31st March 2015]
No. of Shares held at the end of the year [As on 31st March 2016] %
Change during
the year Demat Physical Total% of
Total Shares
Demat Physical Total% of
Total Shares
g) FIIs NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
h) Foreign VentureCapitalFunds
NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
i) Others (specify) NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
Sub-total (B)(1): - NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
2. Non-Institutions
a) Bodies Corp. 0.00% 0.00% 0.00%
i) Indian NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
ii) Overseas NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
b) Individuals NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
i) Individual shareholders holding nominal share capital upto Rs.1lakh
NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
ii) Individual shareholders holding nominal share capital in excessofRs.1lakh
NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
c) Others (specify) NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
Non Resident Indians NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
Overseas Corporate Bodies NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
Foreign Nationals NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
Clearing Members NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
Trusts NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
Foreign Bodies - D R NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
HUF NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
Sub-total (B)(2): - NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
Total Public Shareholding (B)=(B)(1) + (B)(2)
NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
C. Shares held by Custodian for GDRs & ADRs.
NIL NIL NIL 0.00% NIL NIL NIL 0.00% 0.00%
Grand Total (A+B+C) - 14,83,855 14,83,855 100% NIL 14,83,855 14,83,855 100% -
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B) Shareholding of Promoter:
SN Shareholder’s Name
Shareholding at the beginning of the year
Shareholding at the end of the year
% change in share-holding during
the yearNo. of Shares
% of total Shares of the com-
pany
% of Shares
Pledged/ encum-bered
to total shares
No. of Shares
% of total Shares of the
company
% of Shares
Pledged / encum-
bered to total shares
1 Deepali Gupta 142,700 9.62% NIL NIL 0.00% NIL -100.00%
2 Pushpa Gupta 139,855 9.43% NIL NIL 0.00% NIL -100.00%
3 Sunil Gupta 168,500 11.36% NIL NIL 0.00% NIL -100.00%
4 Sushil Gupta 168,500 11.36% NIL NIL 0.00% NIL -100.00%
5 Suman Gupta 193,500 13.04% NIL NIL 0.00% NIL -100.00%
6 Sunil Gupta HUF 137,200 9.25% NIL NIL 0.00% NIL -100.00%
7 Sushil Gupta HUF 137,200 9.25% NIL NIL 0.00% NIL -100.00%
8 S M Gupta HUF 136,794 9.22% NIL NIL 0.00% NIL -100.00%
9 Sanjay Kaul NIL 0.00% NIL 10 0.00% NIL 0.00%
10 Deviinder Gupta NIL 0.00% NIL 10 0.00% NIL 0.00%
SarikaSaxena NIL 0.00% NIL 10 0.00% NIL 0.00%
11National Collat-eral Management ServicesLimited
NIL 0.00% NIL 1,483,825 100.00% NIL 100.00%
C) Change in Promoters’ Shareholding (please specify, if there is no change)
SN Shareholding at the beginning of the year
Changes during the Year Cumulative Shareholding at the end of the year
No. of shares
% of totalshares of
thecompany
Date Increase Decrease No. of shares
% of totalshares of
thecompany
1. 14,83,855 100% 12.02.2016TRANSFER
NIL NIL 14,83,855 100%
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D) Shareholding Pattern of top ten Shareholders: (Other than Directors, Promoters and Holders of GDRs and ADRs) is reported to be
SN For each of the Top 10 shareholders
Date Reason Shareholding at the beginning of the year
Cumulative Shareholding during the year
No. of shares % of total shares
No. of shares % of total shares
1
National Collateral Management Services Limited
At the beginning of the year NIL 0.00% NIL 0.00%
Changes during the year 12.02.16 Transfer 1,483,825 100.00% 1,483,825 100.00%
At the end of the year 1,483,825 100.00% 1,483,825 100.00%
2
Trans global Securities Limited
At the beginning of the year 259,606 17.50% 259,606 17.50%
Changes during the year 12.02.16 Transfer (259,606) -17.50% (259,606) -17.50%
At the end of the year NIL 0.00% NIL 0.00%
3
Suman Gupta
At the beginning of the year 193,500 13.04% 193,500 13.04%
Changes during the year 12.02.16 Transfer (193,500) -13.04% (193,500) -13.04%
At the end of the year NIL 0.00% NIL 0.00%
4
Sushil Gupta
At the beginning of the year 168,500 11.36% 168,500 11.36%
Changes during the year 12.02.16 Transfer (168,500) -11.36% (168,500) -11.36%
At the end of the year NIL NIL NIL 0.00%
5
Sunil Gupta
At the beginning of the year 168,500 11.36% 168,500 11.36%
Changes during the year 12.02.16 Transfer (168,500) -11.36% (168,500) -11.36%
At the end of the year NIL 0.00% NIL 0.00%
6
Deepali Gupta
At the beginning of the year 142,700 9.62% 142,700 9.62%
Changes during the year 12.02.16 Transfer (142,700) -9.62% (142,700) -9.62%
At the end of the year NIL 0.00% NIL 0.00%
7
Pushpa Gupta
At the beginning of the year 139,855 9.43% 139,855 9.43%
Changes during the year 12.02.16 Transfer (139,855) -9.43% (139,855) -9.43%
At the end of the year NIL 0.00% NIL 0.00%
15
SN For each of the Top 10 shareholders
Date Reason Shareholding at the beginning of the year
Cumulative Shareholding during the year
8
Sunil Gupta HUF
At the beginning of the year 137,200 9.25% 137,200 9.25%
Changes during the year 12.02.16 Transfer (137,200) -9.25% (137,200) -9.25%
At the end of the year NIL 0.00% NIL 0.00%
9
Sushil Gupta HUF
At the beginning of the year 137,200 9.25% 137,200 9.25%
Changes during the year 12.02.16 Transfer (137,200) -9.25% (137,200) -9.25%
At the end of the year NIL 0.00% NIL 0.00%
10
Sunil Gupta HUF
At the beginning of the year 136,794 9.22% 136,794 9.22%
Changes during the year 12.02.16 Transfer (136,794) -9.22% (136,794) -9.22%
At the end of the year NIL 0.00% NIL 0.00%
E) Shareholding of Directors and Key Managerial Personnel:
SN Shareholding of each Directors and each Key Managerial Personnel
Shareholding at the beginning of the year
Cumulative Shareholding during the year
No. of shares % of totalshares of the
company
No. of shares % of totalshares of the
company
At the beginning of the year 337000 22.71% 337000 22.71%
Date wise Increase / Decrease in Promoters Share holding during the year specifying the reasons for increase / decrease (e.g. allotment / transfer/bonus/sweatequityetc):
12/02/2016 TRANSFER
NIL 12/02/2016 TRANSFER
NIL
At the end of the year 20 0.0013% 20 0.0013%
F) INDEBTEDNESS - Indebtedness of the Company including interest outstanding/accrued but not due for payment
Particular Secured Loans excluding deposits
Unsecured Loans
Deposits Total Indeb-
tednessIndebtedness at the beginning of the financial year
i) Principal Amount NIL NIL NIL NIL
ii) Interest due but not paid NIL NIL NIL NIL
iii) Interest accrued but not due NIL NIL NIL NIL
Total (i+ii+iii) NIL NIL NIL NIL
16
Particular Secured Loans excluding deposits
Unsecured Loans
Deposits Total Indeb-
tednessChange in Indebtedness during the financial year
* Addition NIL NIL NIL NIL
* Reduction NIL NIL NIL NIL
Net Change NIL NIL NIL NIL
Indebtedness at the end of the financial year
i) Principal Amount NIL NIL NIL NIL
ii) Interest due but not paid NIL NIL NIL NIL
iii) Interest accrued but not due NIL NIL NIL NIL
Total (i+ii+iii) NIL NIL NIL NIL
XI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL-A. Remuneration to Managing Director, Whole-time Directors and/or Manager:
SN. Particulars of Remuneration Name of MD/WTD/ Manager Total Amount
NAME DEVIINDERGUPTA NIL NIL
DESIGNATION MD&CEO NIL NIL
1 Gross salary NIL NIL NIL
(a) Salary as per provisions contained insection17(1)oftheIncome-tax Act,1961
799,814 NIL NIL
(b)Valueofperquisitesu/s17(2)Income-taxAct,1961
MealCoupons,ActualtelephoneExpenseResidenceandOffice,Health
Insurance of Rs. 4 lacs and accident CoverageofRs.100Lacs
NIL NIL
(c)Profitsinlieuofsalaryundersection17(3)Income-taxAct,1961
NIL NIL NIL
2 StockOption NIL NIL NIL
3 SweatEquity NIL NIL NIL
4 Commission -as%ofprofit -others,specify
NIL NIL NIL
5 Others,pleasespecify NIL NIL NIL
Total (A) 799,814 NIL NIL
Ceiling as per the Act
17
B. Remuneration to other directors
SN.
Particulars of Remuneration
Name of DirectorsTotal
AmountNIL NIL NIL NIL NIL
1
Independent Directors NIL NIL NIL NIL NIL
Fee for attending board committee meetings
NIL NIL NIL NIL NIL
Commission NIL NIL NIL NIL NIL
Others,pleasespecify NIL NIL NIL NIL NIL
Total (1) NIL NIL NIL NIL NIL
2
OtherNon-ExecutiveDirectorsMR. HARSHA RAGHAVAN
MR. SUMIT wMAHESHWARI
MR. SANJAY KAUL
-
Fee for attending board committee meetings
NIL NIL NIL NIL NIL
Commission NIL NIL NIL NIL NIL
Others,pleasespecify NIL NIL NIL NIL NIL
Total (2) NIL NIL NIL NIL NIL
Total (B)= (1+2) NIL NIL NIL NIL NIL
Total Managerial Remuneration
NIL NIL NIL NIL NIL
Overall Ceiling as per the Act NIL NIL NIL NIL NIL
C. REMUNERATION TO KEY MANAGERIAL PERSONNEL OTHER THAN MD/MANAGER/WTD
SN Particulars of Remuneration
Key Managerial Personnel
CEO CS CFO Total
1
Gross salary NIL NIL NIL NIL
(a) Salary as per provisions contained in section 17(1)oftheIncome-taxAct,1961
NIL NIL NIL NIL
(b) Value of perquisites u/s 17(2) Income-tax Act,1961
NIL NIL NIL NIL
(c) Profits in lieu of salary under section 17(3)Income-taxAct,1961
NIL NIL NIL NIL
2 StockOption NIL NIL NIL NIL
3 SweatEquity NIL NIL NIL NIL
4 Commission NIL NIL NIL NIL
-as%ofprofit NIL NIL NIL NIL
Others specify NIL NIL NIL NIL
5 Others,pleasespecify NIL NIL NIL NIL
Total NIL NIL NIL NIL
18
XII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES:TheCompanyduringtheperiodhasnotreceivedPenalties/Punishment/CompoundingofOffencesisreported to be Nil.
For and on behalf of the Board of DirectorsNCML Finance Private LimitedCIN:U67190MH2009PTC191081
_____________________ _____________________________________
Mr. Sanjay Kaul Mr. Deviinder Gupta Chairman MD&CEO DINNo.:01729695 DINNo.:00619149 Place:Mumbai Place:Istanbul Date:28May,2016 Date:28May,2016
19
Annexure BDetails of Contracts or arrangements or transactions not at arm’s length basis
SL. No.
Particulars Details
1 Name (s) of the related party & nature of relationship
Name of Related party Nature of Relation
OrnateUniversalDevelopersPvt.Ltd. Associate Company
Ornate Buildcon Developers Associate Company
OrnateInfraHoldingsPvt.Ltd. Associate Company
BoosterDealersPvt.Ltd. Associate Company
RiteDevelopersPvt.Ltd. Associate Company
Rita Ornate Developers Associate Company
Suman Gupta Relative of KMP
Deepali Gupta Relative of KMP
Sunil Gupta KMP
Sunil Gupta (HUF) HUF of KMP
Sushil Gupta KMP
Sushil Gupta (HUF) HUF of KMP
PratikAgarwal Relative of KMP
PeculiarMetalPvt.Ltd. Associate Company
National Collateral Management ServicesLimited
Holding Company
Deviinder Gupta MD&CEO
20
2 Nature of contracts / arrangements/ transaction
1.OrnateUniversalDevelopersPvt.Ltd.-LoanGiven-1,000,000LoanRecovered-(1,000,000)InterestIncome-3,777
2.BoosterDealersPvt.Ltd.LoanGiven-31,300,000LoanRecovered-(31,300,000)InterestIncome-1,967,741
3. Ornate Buildcon DevelopersLoanGiven-14,200,000LoanRecovered-(14,200,000)InterestIncome-411,977
4. Suman GuptaLoanGiven-10,250,000LoanRecovered-(10,250,000)InterestIncome-119,331
5. Deepali GuptaLoanGiven-1,420,000LoanRecovered-(1,420,000)InterestIncome-9,676
6. Sunil GuptaLoanGiven-550,000LoanRecovered-(550,000)InterestIncome-4,565
7. Sushil GuptaLoanGiven-1,275,000LoanRecovered-(1,275,000)InterestIncome-9,513
8.PeculiarMetalPvt.Ltd.RentPaid-55,800
9.NationalCollateralManagementServicesLimitedLoanGiven-44,290,000ReimbursementpayabletoNCML-22,343,861InterestIncome-652,249
10. Deviinder GuptaRemuneration-799,814
3 Duration of the contracts/arrangements/transaction
12 Months
4 Salient terms of the contracts or arrangements or transaction including the value,ifany
NIL
5 Justificationforenteringintosuchcontractsor arrangements or transactions
Arm’sLengthBasis
21
6 date(s) of approval by the Board 28/05/2016
7 Amountpaidasadvances,ifany NIL
For and on behalf of the Board of Directors
NCML Finance Private LimitedCIN:U67190MH2009PTC191081
_____________________ _____________________________________
Mr. Sanjay Kaul Mr. Deviinder Gupta Chairman MD&CEO DINNo.:01729695 DINNo.:00619149 Place:Mumbai Place:Istanbul Date:28May,2016 Date:28May,2016
22
Report on the Financial Statements
We have audited the accompanying standalone financial statements of NCML Finance PrivateLimited formerly known as TG Finance PrivateLimited (The Company’), which comprise theBalance Sheet as at 31stMarch2016,theStatementofProfitandLoss,theCashFlowStatementfortheyearthenended,andasummaryofthesignificantaccounting policies and other explanatoryinformation.
Managements’ Responsibility for the Financial Statements
The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (’the Act’) with respect tothe preparation of these standalone financialstatements that give a true and fair view of the financial position, financial performance andcash flows of the Company in accordance withthe accounting principles generally accepted in India, including the Accounting StandardsspecifiedunderSection 133of theAct, readwithRule 7 of the Companies (Accounts) Rules, 2014.This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments andestimates that are reasonable and prudent; and design, implementation and maintenance ofadequate internal financial controls, that wereoperatingeffectivelyforensuringtheaccuracyandcompletenessoftheaccountingrecords,relevanttothepreparationandpresentationofthefinancialstatements that give a true and fair view and are freefrommaterialmisstatement,whetherduetofraud or error.
Auditors’ Responsibility
Ourresponsibilityistoexpressanopiniononthesestandalone financial statements based on ouraudit.
WehavetakenintoaccounttheprovisionsoftheAct, the accounting and auditing standards andmatters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.
We conducted our audit in accordance with the StandardsonAuditingspecifiedunderSection143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are freefrom material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. Theprocedures selected depend on the auditor’s judgment,includingtheassessmentoftherisksofmaterialmisstatementofthefinancialstatements.whether due to fraud or error. In making thoserisk assessments, the auditor considers internalfinancial control relevant to the Company’spreparation of the financial statements thatgive a true and fair view in order to design audit procedures that are appropriate.
An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, aswell as evaluating the overall presentation of the financialstatements.
We believe that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the standalone financialstatements.
Independent Auditor’s ReportTo the Members of NCML Finance Private Limited
23
OpinionIn our opinion and to the best of our information andaccordingtotheexplanationsgiventous,theaforesaidstandalonefinancialstatementsgivetheinformation required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted inIndia,ofthestateofaffairsoftheCompanyasat31stMarch2016,anditslossanditscashflowsforthe year ended on that date.
Other MatterThefinancial statementsof theCompany for theyear ended 31st March 2015 were audited by another auditorwhoexpressedanunmodifiedopiniononthosestatementson9September2015.
Report on Other Legal and Regulatory Requirements
As required by the Companies (Auditors’ Report) Order, 2016 (‘the Order’) issued by the CentralGovernment of India in terms of sub section (11) of section143oftheAct,wegiveintheAnnexureA,astatementonthemattersspecifiedinparagraph 3and4oftheOrder,totheextentapplicable.
As required by Section 143 (3) of the Act. we report that:
a) We have sought and obtained all the information and explanations which tothe best of our knowledge and beliefwerenecessary for the purposes of our audit;
b) In our opinion, proper books of accountas required by law have been kept by theCompany so far as it appears from our examinationofthosebooks;
c) The Balance Sheet, the Statement of ProfitandLoss,andtheCashFlowStatementdealt
with by this Report are in agreement with the booksofaccount;
d) In our opinion, the aforesaid standalonefinancial statements comply with theAccounting Standards specified underSection133oftheAct,readwithRule7oftheCompanies(Accounts)Rules,2014;
e) On the basis of the written representations received from the directors as on 31st March 2016 takenon recordby theBoardof Directors, none of the directors is disqualified as on 31st March 2016 from being appointed as a director in terms of Section 164(2) of the Act;
f) With respect to the adequacy of the internal financialcontrolsoverfinancial reportingof theCompanyandtheoperatingeffectivenessofsuchcontrols,refertoourseparatereportin‘AnnexureB’;
i) With respect to the other matters to be included in the Auditors’ Report in accordance with Rule 1 1 of the Companies (Audit and Auditors) Rules, 2014, in ouropinion and to the best of our information andaccordingtotheexplanationsgiventous:
ii) The Company does not have any pending litigationswhichwouldimpactitsfinancialposition;
iii) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;
There were no amounts which were required to be transferred to the Investor Education andProtection Fund by the Company.
For B S R & Co LLPChartered Accountants
Firm’sRegistrationNo:101248W/W-100022
Aniruddfra GodbolePartner
MembershipNo:105149Place:Mumbai
Date:28May,2016
24
The Annexure A referred to in IndependentAuditors’ Report to the members of the Company on the financial statements for the year ended 31stMarch2016,wereportthat:
i) a) The Company has maintained proper recordsshowingfullparticulars,includingquantitativedetailsandsituationoffixedassets.
b) The Company has a regular program of physical verification of its fixed assetsbywhichall thefixedassetsareverifiedin a phased manner over a period of two years. In our opinion, this periodicity ofphysicalverificationisreasonablehavingregard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.
c) According to the information and explanationsgiventousandonthebasisofourexaminationoftherecordsoftheCompany,thereisnoimmovablepropertyheld in the name of the Company.
ii) The Company is a service company. Accordingly, it does not hold any physicalinventories. Thus, paragraph 3 (ii) of theOrder is not applicable to the Company.
iii) The Company has granted loan to parties covered in the register maintained under section189oftheAct.
a) The terms and condition of the grant of such loans are not prejudicial to the company
b) The schedule of repayment of principal and payment of interest has been stipulated and are regular.
iv) Accordingtotheinformationandexplanationgiven to us and on the basis of our examinationoftherecordsoftheCompany,the provisions of section 185 and 186 of the Act are not applicable to the Company. Accordingly,paragraph3(iv)of theOrder isnot applicable.
v) According to the information and explanations given to us, the Company hasnot accepted any deposits from the public to which the directives issued by the Reserve Bankof India and theprovisionsof Section 73 to Section 76 or any other relevant provisions of the Act and the rules framed there under apply.
vi) The Central Government has not prescribed the maintenance of cost records under sub section (1) of section 148 of the Act for any of the services rendered by the Company. Accordingly paragraph 3(vi) of the Order is not applicable
vii) a) According to the information and explanations given to us and on thebasis of our examination of the recordsof the Company, amounts deducted/accrued in the books of account inrespect of undisputed statutory dues including income-tax, service tax, andother statutory dues have generally been deposited regularly during the year by the Company to the appropriate authorities. No undisputed amounts payableinrespectof,incometax,servicetax, and other statutory dues were inarrears as at 31st March 2016 for a period ofmore than sixmonths from the datethey became payable.
b) According to the information and explanations given to us, there are nodues of income tax, service tax andother statutory dues which have not been deposited with the appropriate authorities on account of any dispute.
viii) In our opinion and according to the informationandexplanationsgiventous,theCompany has not defaulted in the repayment ofloansorborrowingstofinancialinstitutions,banks,Governmentordebentureholders.
ix) The Company has not raised anymoney byway of initial public offer or further publicofferandtermloansduringtheyear.
Annexure A to the Independent Auditors’ Report
25
x) According to the information andexplanationsgiven tous,no fraudonorbytheCompanybyitsofficersoremployeeshasbeen noticed or reported during the course of our audit.
xi) According to the information and explanations give to us and based on ourexaminationoftherecordsoftheCompany,since the Company is a private limited company, the provisions of Section 197are not applicable to the Company. Thus,paragraph3(xi)oftheOrderisnotapplicable.
xii) In our opinion and according to theinformation and explanations given tous, the Company is not a nidhi company.Accordingly,paragraph3(xii)oftheOrderisnot applicable.
xiii) According to the information andexplanations given to us and on the basisof our examination of the records of theCompany, transactions with the relatedparties are in compliance with section 177 and 188 of the Act where applicable and the
details have been disclosed in the financialstatements, as required by the applicableaccounting standards.
xiv) According to the information andexplanations given to us and based on ourexaminationoftherecordsoftheCompany,the Company has made preferential allotment of the equity shares to its holding company during the year. Shares issued are in compliance with section 42 of the Act.
xv) According to the information andexplanations given to us and based on ourexaminationoftherecordsoftheCompany,the Company has not entered into any non-cash transactions with directors or persons connectedwithhim.Accordingly,paragraph3(xv)oftheOrderisnotapplicable.
xvi) Accordingtotheinformationandexplanationgiventous,theCompanyisregisteredundersection 45-IA of Reserve Bank of India Act1934 and it has obtained a certificate ofregistration dated 14 February 2011.
For B S R & Co LLPChartered Accountants
Firm’sRegistrationNo:101248W/W-100022
Aniruddfra GodbolePartner
MembershipNo:105149Place:Mumbai
Date:28May,2016
26
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (‘the Act’)
WehaveauditedtheinternalfinancialcontrolsoverfinancialreportingofNCMLFinancePrivateLimitedformerly known as TG Finance Private Limited (‘theCompany’)asof31st March 2016 in conjunction withour audit of the financial statements of theCompany for the year ended on that date.
Management’s Responsibility for Internal Financial Controls
The Company’s management is responsible for establishing and maintaining internal financialcontrolsbasedontheinternalcontroloverfinancialreporting criteria established by the Company 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 (‘ICAI’). These responsibilities includethe design, implementation and maintenance ofadequate internal financial controls that wereoperating effectively for ensuring the orderlyand efficient conduct of its business, includingadherencetocompany’spolicies,thesafeguardingofitsassets,thepreventionanddetectionoffraudsanderrors,theaccuracyandcompletenessoftheaccountingrecords,andthetimelypreparationofreliable financial information, as required undertheCompaniesAct,2013.
Auditors’ Responsibility
Ourresponsibility istoexpressanopinionontheCompany’sinternalfinancialcontrolsoverfinancialreporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting(the‘GuidanceNote’)andtheStandardson Auditing, issued by ICAI and deemed to beprescribed under section 143(10) of the Companies Act, 2013, to theextentapplicable toanauditof
internal financial controls, both applicable to anauditofInternalFinancialControlsand,bothissuedby the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operatedeffectivelyinallmaterialrespects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financialreporting and their operating effectiveness. Ouraudit of internal financial controls over financialreporting included obtaining an understanding of internalfinancialcontrolsoverfinancialreporting,assessing the risk that a material weaknessexists,andtestingandevaluatingthedesignandoperating effectiveness of internal control basedon the assessed risk. The procedures selecteddepend on the auditor’s judgment, including theassessmentof therisksofmaterialmisstatementofthefinancialstatements,whetherduetofraudor error.
We believe that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the Company’s internal financial controls system over financialreporting.
Meaning of Internal Financial Controls over Financial Reporting
A company’s internal financial control overfinancialreportingisaprocessdesignedtoprovidereasonable assurance regarding the reliability of financialreportingandthepreparationoffinancialstatements for external purposes in accordancewith generally accepted accounting principles. Acompany’sinternalfinancialcontroloverfinancialreporting includes those policies and procedures that(1)pertaintothemaintenanceofrecordsthat,
Annexure - B to the Independent Auditors’ Report
27
inreasonabledetail,accuratelyandfairlyreflectthetransactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparationoffinancialstatementsinaccordancewithgenerallyacceptedaccountingprinciples,andthatreceiptsandexpendituresofthecompanyarebeing made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’sassets that could have a material effect on thefinancialstatements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financialcontrolsoverfinancialreporting,includingthe possibility of collusion or improper management overrideof controls,materialmisstatementsdue
to error or fraud may occur and not be detected. Also,projectionsofanyevaluationoftheinternalfinancial controls over financial reporting tofuture periods are subject to the risk that theinternal financial control over financial reportingmay become inadequate because of changes in conditions,orthatthedegreeofcompliancewiththe policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all materialrespects, an adequate internal financial controlssystemoverfinancial reportingand such internalfinancial controls over financial reporting wereoperatingeffectivelyasat31stMarch2016,basedon the internal control over financial reportingcriteria established by the Company 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.
For B S R & Co LLPChartered Accountants
Firm’sRegistrationNo:101248W/W-100022
Aniruddfra GodbolePartner
MembershipNo:105149Place:Mumbai
Date:28May,2016
28
Balance Sheet as at 31st March 2016(Currency:INR)
As at 31st March 2016 As at 31st March 2015EQUITY AND LIABILITIESShareholders’ fundsShare capital 2.1 14,838,550 14,838,550Reserves and surplus 2.2 8,756,260 30,099,094
23,594,810 44,937,644Non-current liabilitiesDeferredTaxLiability 2.14 10,503 -
Current liabilitiesOther current liabilities 2.3 22,931,435 18,854Short-term provisions 2.4 132,870 -
23,064,305 18,854TOTAL 46,669,618 44,956,498
ASSETSNon-current assetsFixed assetsTangible assets 2.5 245,709 142,285
245,709 142,285
Long-term loans and advances 2.6 470,552 58,989 470,552 58,989
Current assetsCashandbankbalances 2.7 746,994 37,094,163Short-term loans and advances 2.8 44,530,821 5,019,316Other current assets 2.9 675,542 2,641,745
45,953,357 44,755,224TOTAL 46,669,618 44,956,498Significantaccountingpolicies 1.2Notestothefinancialstatements 2.1 to 2.27
Seeaccompanyingnotesformingpartofthefinancialstatement. As per our report of even date attached.
For B S R & Co. LLP For and on behalf of the Board of Directors of Chartered Accountants NCML Finance Private LimitedFirm’sRegistrationNo:101248W/W-100022 CIN:U67190MH2009PTC191081
Aniruddha Godbole Sanjay Kaul Deviinder GuptaPartner Chairman MD&CEOMembershipNo:105149 DIN:01729695 DIN:00619149Mumbai Mumbai Istanbul28 May 2016 28 May 2016 28 May 2016
29
Seeaccompanyingnotesformingpartofthefinancialstatement. As per our report of even date attached.
For B S R & Co. LLP For and on behalf of the Board of Directors of Chartered Accountants NCML Finance Private LimitedFirm’sRegistrationNo:101248W/W-100022 CIN:U67190MH2009PTC191081
Aniruddha Godbole Sanjay Kaul Deviinder GuptaPartner Chairman MD&CEOMembershipNo:105149 DIN:01729695 DIN:00619149Mumbai Mumbai Istanbul28 May 2016 28 May 2016 28 May 2016
Statement of Profit and Loss for the year ended 31st March 2016
(Currency:INR)For the Year ended
31st March 2016For the Year ended
31st March 2015Revenue from operations 2.10 3,178,829 1,416,252
Other income 2.11 1,173,002 3,453,945
Total Revenue (I + II) 4,351,831 4,870,197
Expenses
Employeebenefitsexpense 2.12 15,205,934 3,797,282
Depreciation and amortisation 2.5 63,615 33,807
Otherexpenses 2.13 10,414,613 870,686
25,684,162 4,701,775(Loss) / Profit before exceptional and extra ordinary items and tax (III - IV) (21,332,331) 168,422
ExceptionalItems - - (Loss)/ProfitbeforeExtraOrdinary ItemsandTaxes(V+VI) (21,332,331) 168,422
ExtraOrdinaryItems - -
(Loss) / Profit before Taxes (VII + VIII) (21,332,331) 168,422
Taxexpense: 2.14 10,503 17,995Net (Loss) / Profit for the year from Continuing Operation (21,342,834) 150,427
Earnings per equity share of INR 10/- each
BasicandDilutedEarningsPerShare(InINR) (14) 0.10
Weighted Average Number of outstanding shares 1,483,855 1,483,855
Significant accounting policies 1.2
Notes to the financial statements 2.1 to 2.27
30
Cash Flow Statement for the year ended 31st March 2016
(Currency:INR)For the year ended
31st March 2016For the year ended
31st March 2015CASH FLOW FROM OPERATING ACTIVITIESProfit / (Loss) before tax (21,332,331) 168,423Adjustmentsfor:Depreciation and amortisation 63,615 33,807ProfitonSaleofInvestment -- (2,050,010)Profit/lossondisposalofassets(net) 59,785 ---
123,400 (2,016,203)Operating cash flow before working capital changes (21,208,931) (1,847,780)Adjustmentsforchangesinworkingcapital(Increase)/DecreaseinLoansandAdvances (40,300,403) 27,557,106(Decrease)/IncreaseinOtherCurrentLiabilities 22,912,581 1,000(Decrease) / Increase in Short Term Provisions 132,870 --
(17,254,952) 27,558,106Cashflows(usedin)/generatedfromoperations (38,463,883) 25,710,326TaxesPaid 249,495 112,702
Net cash flows Increase / (Decrease) from operating activities (A) (38,214,388) 25,823,028
CASH FLOW FROM INVESTING ACTIVITIESPurchaseoffixedassets (657,781) -- Proceedsfromsaleoffixedassets 25,000 -- Proceeds from sale of Investment 2,500,000 9,800,001
Net cash flows (used in) investing activities (B) 1,867,219 9,800,001
CASH FLOW FROM FINANCING ACTIVITIES (C) -- --
Net (decrease) in cash and cash equivalents (A+B+C) (36,347,169) 35,623,029
Net (decrease) / Increase in Cash and Cash Equivalent (36,347,169) 35,623,029
Cash and cash equivalents at the beginning of the year 37,094,163 1,471,134
Cash and cash equivalents at the end of the year 746,994 37,094,163
Sub-notes:The cash flow statement has been prepared under the indirectmethod as set out in Accounting Standard - 3(‘AS3’)onCashFlowStatementprescribedinCompanies(AccountingStandard)Rules,2006.
Seeaccompanyingnotesformingpartofthefinancialstatement. As per our report of even date attached.
For B S R & Co. LLP For and on behalf of the Board of Directors of Chartered Accountants NCML Finance Private LimitedFirm’sRegistrationNo:101248W/W-100022 CIN:U67190MH2009PTC191081
Aniruddha Godbole Sanjay Kaul Deviinder GuptaPartner Chairman MD&CEOMembershipNo:105149 DIN:01729695 DIN:00619149Mumbai Mumbai Istanbul28 May 2016 28 May 2016 28 May 2016
31
Background
NCML Finance Private Limited (Formerly knownas T G Finance Private Limited) (‘the Company’)is a private limited company incorporated on 20thMarch2009undertheCompaniesAct,1956. TheCompanyisregisteredasNonBankingFinanceCompany (NBFC) vide certificate no. N-13.01984dated 14.02.2011 (previously issued in the name ofTGFinancePrivateLimitedvideCertificateNo.N-13.01984dated14.02.2011)withReserveBankofIndia (RBI) and provide its services as Non Deposit TakingNonBankingFinanceCompany(ND–NBFC).The Company is primarily engaged in the business of commodity finance with focus on rural and agri-businessfinancedomain.
1.2 Significant accounting policies
The accounting policies set out below have been applied consistently to the years presentedinthefinancialstatements.
Basis of preparation of financial statements
a) Theaccompanyingfinancialstatementshavebeen prepared and presented under the historical cost convention, on the accrualbasis of accounting. In accordance with the accounting principles generally accepted in India (‘Indian GAAP’) and comply withthe Accounting standards prescribed in the Companies (Accounting Standards) Rules,2015, issued by the Central Governmentunder Section 133 of the Companies Act,2013 (‘the Act’) in consultation with theNational Advisory Committee on Accounting Standards, to the extent applicable andthe guidelines issued by RBI as applicable to NBFC. The financial statements arepresented in Indian rupees. Policies adopted inthepreparationoffinancialstatementareconsistent with those in previous year.
NCML Finance Private Limited
Notes Forming Part of the Financial Statement for
The Year Ended March 31st, 2016
Use of estimates
b) The preparation of financial statementsin conformity with Generally Accepted Accounting Principles (GAAP) requires managementtomakejudgments,estimatesandassumptions that affect the applicationof accounting policies and reported amounts of assets, liabilities, income and expensesand the disclosure of contingent liabilities on thedateof thefinancial statements.Actualresults could differ from those estimates.Estimates and underlying assumptions arereviewed on an ongoing basis. Any revision to accounting estimates is recognised prospectively in current and future periods.
Current, non-current classification
c) All assets and liabilities are classified intocurrent and non-current.
Assets
An asset is classified as current when itsatisfiesanyofthefollowingcriteria:
a) it is expected to be realised in, or isintendedforsaleorconsumptionin,thecompany’s normal operating cycle;
b) it is held primarily for the purpose of being traded;
c) it is expected to be realised within 12months after the reporting date; or
d) it is cash or cash equivalent unless it is restrictedfrombeingexchangedorusedto settle a liability for at least 12 months after the reporting date
Current assets include the current portion of non-currentfinancialassets
Allotherassetsareclassifiedasnon-current.
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Liabilities
A liability is classified as currentwhen it satisfiesanyofthefollowingcriteria:
a) itisexpectedtobesettledinthecompany’snormal operating cycle;
b) it is held primarily for the purpose of being traded;
c) it is due to be settled within 12 months after the reporting date; or
d) the company does not have an unconditional right to defer settlement of the liability for at least 12 months after the reporting date
Current liabilities include current portion of non-currentfinancialliabilities
Allotherliabilitiesareclassifiedasnon-current.
Operating cycle
An operating cycle is the time between the acquisition of assets for processing and their realisation in cash or cash equivalents. In case of non-bankingfinancialcompaniesnormaloperatingcycleisnotdeterminable,andthereforeoperatingcycle isconsideredas12monthsforclassificationof current and non-current assets and liabilities asrequiredbyScheduleIIIoftheCompaniesAct,2013.
d) Fixed assets and depreciation / amortisation
Tangible fixed assets
Tangiblefixedassetsarestatedatacquisitioncost less accumulated depreciation and impairment loss, ifany.Theacquisitioncostoffixedassetscomprisesofpurchaseprice,taxes, duties, freight and other incidentalexpenses required to bring the asset to itsworking condition for its intended use. TheCompany depreciates its fixed assets onStraightLineMethod(SLM)over theusefullives of assets estimated by Management. Depreciation for assets purchased or sold during a period is proportionately charged. The Management estimates for useful lives oftangiblefixedassetsaresetoutbelow:
Assets Group Estimated useful life
Computer Hardware* 3 Years
Assets costing INR 5,000 or less are fullydepreciated in the year of purchase. Depreciation is charged on a proportionate basis for all assets purchased and sold during the year.
*For these class of assets based on internal assessmentcarriedoutbythemanagement,thattheusefullivesasgivenabove,bestrepresenttheperiodoverwhichmanagementexpectstousetheassets.Hence,theusefullivesfortheseassetsaredifferentfromtheusefullivesasprescribedunderPartCofScheduleIIoftheCompaniesAct,2013.
Capital Work-in-Progress
Capitalwork-in-progressincludesthecostoffixedassets that are not ready to use at the balance sheet date. Advances paid to acquire capital assets before the balance sheet date are disclosed under Long-termloansandadvances
e) Impairment of Assets
In accordance with Accounting Standard 28 on ‘Impairment of assets’, the Companyassessesateachbalancesheetdate,whetherthere is any indication that an asset may be impaired. If any such indication exists, theCompany estimates the recoverable amount of the asset. The recoverable amount of the assets (or where applicable that of the cash generating unit to which the asset belongs) is estimated as the higher of its net selling priceanditsvalueinuse.Valueinuseisthepresentvalueofestimatedfuturecashflowsexpectedtoarisefromthecontinuinguseofthe asset and from its disposal at the end of the useful life. An impairment loss is recognised whenever the carrying amount of an asset or thecashgeneratingunittowhichitbelongs,exceeds its recoverable amount. If at thebalance sheet date, there is an indicationthat previously assessed impairment loss no longerexists, the recoverableamount isreassessedand theasset is reflectedat therecoverable amount subject to amaximumof the depreciated historical cost.
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f) Investment
Investments intended to be held for not more than a year are classified as currentinvestments. All other investments are classifiedas longterm investments.Currentinvestments are carried at lower of cost and fair value determined on an individual investment basis. Long-term investmentsare carried at cost. However, provision fordiminution in value is made to recognise a decline,otherthantemporary,inthevalueofthe investments.
g) Provisioning / Write – Off of assets as per RBI Prudential Norms
Non- Performing loans are written off /provided as per the minimum provision required under the Non- Banking Financial(Non-Deposit Accepting or Holding) CompaniesPrudentialNorms(ReserveBank)Directions,2015.
Provision on standard assets is made as per management estimates as specified inthe RBI notification DNBS.PD.CC.No.207/03.02.002/2010-11 and amended vide RBI notification no. RBI/2014-15/29 DNBR(PD) CC.No.002/03.10.001/2014-15 dated November,10,2014.
h) Cash and Cash Equivalents
Cash and cash equivalents in the cash flowstatement comprise cash at bank and inhand,chequesonhand,remittancesintransitand deposit with original maturity less than 3 months.
i) Operating leases
Leases, where the lessor effectively retainssubstantially all the risks and benefits ofownership, of the leased assets during theleasetermareclassified,asoperatingleases.Operating lease income / expenditure arerecognisedinthestatementofprofitandlosson straight line basis over the leased term.
j) Revenue recognition
Revenue is recognised to the extent that itis probable that the economic benefits willflowtotheCompanyandtherevenuecanbereliably measured.
i) Income from financing activities isrecognised on accrual basis, except incaseofincomeonnonperformingassets,which is recognised on receipt basis.
ii) Interest income on fixed income debtinstruments such as certificate ofdeposits, non-convertible debenturesand commercial papers are recognized on a time proportion basis taking intoaccount the amount outstanding and the effectiverateapplicable.Discount,ifany,is recognised on a time proportion basis over the tenure of the securities.
iii) Interest income on fixed depositsis recognised on a time proportion basis taking into account the amountoutstanding and the rate applicable.
iv) Dividend is recognised as income when right to receive payment is established.
v) Profit/loss on the sale of investments isdetermined on the basis of the weighted average cost method.
vi) Servicecharges,documentationchargesand other fees on loan transactions are recognised at the commencement of the contract.
k) Foreign exchange transactions
Transactions denominated in foreign currency are recorded at the exchangerate prevailing on the date of transactions. Exchange differences arising on foreignexchange transactions settled during theyeararerecognisedinthestatementofprofitand loss of the year.
Monetary assets and liabilities denominated inforeigncurrency,whichareoutstandingasat the yearend are translated using closing exchange rate and the resultant exchangedifferencesare recognised in thestatementofprofitandloss.
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l) Taxation
Income tax expenses comprises of currenttax expenses and deferred tax charge /credit. A provision is made for the current year’s tax based on tax liability computedin accordance with relevant tax rates and taxissues.
Deferred tax
Deferred tax assets and liabilities arerecognizedforthefuturetaxconsequencesattributabletotimingdifferencesthatresultbetween the profits offered for incometaxes and the profits as per the financialstatements.Deferredtaxassetsandliabilitiesaremeasuredusingthetaxratesandthetaxlaws that have been enacted or substantively enacted at the balance sheet date. Deferred taxassetsarerecognisedonlytotheextentthere is reasonable certainty that the assets can be realized in the future; however,where there is unabsorbed depreciation or carried forward loss under taxation laws,deferred tax assets are reviewed only ifthere is virtual certainty of realization of such assets. Deferred tax assets are reviewed ateach balance sheet date and written down orwritten up to reflect the amount that isreasonably / virtually certain (as the case may be) to be realized.
MinimumAlternative Tax (‘MAT’) under theprovisions of the Income-tax Act, 1961 isrecognisedascurrenttaxinthestatementofprofitandloss.ThecreditavailableundertheAct in respect of MAT paid is recognised as anassetonlywhenandtotheextentthereis convincing evidence that the Company will paynormalincometaxduringtheperiodforwhich the MAT credit can be carried forward for set-off against the normal tax liability. MAT credit recognised as an asset is reviewed
at each balance sheet date and written downtotheextenttheaforesaidconvincingevidencenolongerexists.
m) Earnings per share (‘EPS’)
The basic earnings per share (‘EPS’) iscomputed by dividing the net profitattributable to equity shareholders for the year, by the weighted average number of equity shares outstanding during the year. Diluted EPS is computed using the weighted average number of equity and dilutive equity equivalent shares outstanding during the year except where the resultswould be anti-dilutive.
n) Provisions, contingent liabilities and contingent assets
The Company recognises a provision when there is present obligation as a result of a pasteventthatprobablyrequiresanoutflowof resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a presentobligationthatmay,butprobablywillnot, requireanoutflowof resources.Whenthere is a possible obligation or a present obligationinrespectofwhichthelikelihoodof out flow of resources is remote, noprovision or disclosure is made. Contingent Assetsareneitherrecognized,nordisclosedinthefinancialstatement.
Provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimate. If it is no longer probablethatanoutflowofresourceswouldbe required to settle the obligation, theprovision is reversed.
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(Currency:INR)
As at 31st March 2016
As at 31st March 2015
2.1 Share capitalAuthorised:4,500,000(31stMarch2015:2,000,000) EquitysharesofINR10each
450,000,000 20,000,000
450,000,000 20,000,000
Issued, subscribed and paid up:
1,483,855(31stMarch2015:1,483,855)EquitysharesofINR10each, paid-up fully
14,838,550 14,838,550
14,838,550 14,838,550
(1) The reconciliation of the shares outstanding at the beginning and at the end of the year is as below:
No. of shares
Amount (Rs.)
No. of shares
Amount (Rs.)
Number of equity shares at the beginning of the year
1,483,855 14,838,550 1,483,855 14,838,550
Add:Equitysharesissuedduringtheyear - - - -Number of equity shares at the end of the year 1,483,855 14,838,550 1,483,855 14,838,550
(2) Rights, preferences and restrictions attached to equity shares:
TheCompanyhasasingleclassofequityshares.Accordingly,allequitysharesrankequallywithregardtodividends and share in the Company’s residual assets. The equity shares are entitled to receive dividend as declared from time to time . The voting rights of an equity shareholder on a poll (not on show of hands) are inproportiontoitsshareofthepaid-upequitycapitalofthecompany.Votingrightscannotbeexercisedinrespect of shares on which any call or other sums presently payable have not been paid. On winding up of theCompany,theholdersofequityshareswillbeentitledtoreceivetheresidualtothenumberofequityshares held.TheirwasachangeinmanagementoftheCompanybyacquiringtheexistingNBFCnamedTGFinancePrivateLimitedon 12th Feb, 2016pursuant toSharePurchaseAgreemententered inbetweenNationalCollateralManagementServicesLimited(NCML)asPurchaserandtheshareholdersofTGFinancePrivateLimitedasThirdParty.ThisacquisitionhasbeenagreeduponthepaymenttermofINR51,097,757againstpaid-upandsubscribedequitysharecapitalof INR14,838,550divided into1,483,855equitysharesof INR10eachandprivatelyallottedtoNCML.
TheCompanyisintheprocessofraisingfundsthroughRightIssuevideitsofferlettertoalltheshareholderson dated 21stMarch,2016.TheCompanyhasoffered3.5croreEquitySharesof INR 10.00/-each forcash atapremiumofINR1.00/-pershareinproportionatetotheirexistingshareholdings.Theofferisopenon 25thMarch,2016to9thApril,2016foraperiodoffifteendaysandshallbeaccepted/declined/renouncedwithinthisperiod.Outoftheissuedequitysharesonrightbasis,total34,999,265equitysharesofINR10/-each at premiumof INR 1 each, have been allotted to its shareholder “National CollateralManagementServicesLimited(NCML)”vide letterofacceptancedated06April,2016andtheCompanyhasreceivedachequeondated07April,2016ofRs.384,992,212fromNCMLandremainingshareshavebeenlapsed.
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(3) The details of shareholders holding more than 5% of the equity shares of the Company as at year end are as below :
31st March 2016 31st March 2015
Name of shareholders Number of equity shares
held
Percentage holding
Number of equity
shares held
Percentage holding
National Collateral Management Services Limited 1,483,825 99.99% - 0.00%
Nominees(Mr.SanjayKaul,Mr.DeviinderGupta,Ms.SarikaSaxena) 30 0.01% - 0.00%
Deepali Gupta - - 142,700 9.62%
Pushpa Gupta - - 139,855 9.43%
Sunil Gupta - - 168,500 11.36%
Sushil Gupta - - 168,500 11.36%
Suman Gupta - - 193,500 13.04%
Sunil Gupta HUF - - 137,200 9.25%
Sushil Gupta HUF - - 137,200 9.25%
S M Gupta HUF - - 136,794 9.22%
TransglobalSecuritiesLimited - - 259,606 17.50%
37
(Currency:INR)
As at 31st March 2016 As at 31st March 2015
2.2 Reserves and surplus
Securities premium account
Opening balance 31,051,350 31,051,350
Add:Securitiespremiumreceivedonissueofequityshares - -
Less:Premiumutilised - -
Closing balance 31,051,350 31,051,350
Surplus in statement of profit and loss
Opening balance (952,256) (1,102,684)
Add:Profit(loss)fortheyear (21,342,834) 150,428
Less:TransferredtoStatutoryReserve pursuanttoSection45-ICoftheRBIAct,1934
- -
Closing balance (22,295,090) (952,256)
8,756,260 30,099,094
2.3 Other current liabilities
Creditorsforexpenses
- To Related Party (refer note 2.18) 22,343,862 -
- Others 529,690 16,854
Statutoryduespayable:
-Taxdeductedatsource 50,000 -
-ProfessionalTax - 2,000
ExpensesAccrued 7,883 -
22,931,435 18,854
2.4 Short-term provisions
Provision for Standard Assets 132,870 -
132,870 -
38
(Currency:INR)
2.5
Fixe
d as
sets
For t
he p
erio
d en
ded
31st
Mar
ch 2
016
Gro
ss b
lock
D
epre
ciat
ion/
amor
tisat
ion
Net
blo
ck
Sr.
No.
D
escr
iptio
n A
s at
1 A
pril
2015
Add
ition
s
Ded
uctio
ns/
Wri
te O
ff
As
at
31st
Mar
ch
2016
As
at
1 Apr
il 20
15
For
the
year
Ded
uctio
ns/
Wri
te O
ff
As
at
31st
Mar
ch
2016
As
at
31st
Mar
ch
2016
As
at
31st
Mar
ch
2015
Tan
gibl
e as
sets
1 C
ompu
ter h
ardw
are
- 2
45,0
00
- 2
45,0
00
- 5
,897
-
5,8
97
239
,103
-
2 Ir
is S
cann
er
- 6
,824
-
6,8
24
- 2
18
- 2
18
6,6
06
142,285
3Vehicles
460
,000
-
460
,000
-
317
,715
5
7,50
0 3
75,2
15
- -
-
Tot
al
460
,000
2
51,8
24
460
,000
2
51,8
24
317
,715
6
3,61
5 3
75,2
15
6,11
5 2
45,7
09
142,285
As o
f 31st
Mar
ch, 2
015
526
,200
-
- 4
60,0
00
350
,108
3
3,80
7 -
317
,715
14
2,28
5 -
Note:
1)TotalDepreciationandAm
ortisationforthecurrentyearisRs.63,615andforthepreviousyearended31stM
arch,
2015isRs.33,807.
2)
Fig
ures
in It
alic
s pe
rtai
ns to
the
prev
ious
yea
r end
ed 3
1stMarch,2015.
39
(Currency:INR)
As at 31st March 2016 As at 31st March 2015
2.6 Long-term loans and advances
(Unsecured and considered good)
- To parties other than related parties
Prepaidexpenses 5,606 -
MAT Credit receivable 58,989 58,989
Capital advances 405,957 -
470,552 58,989
2.7 Cash and Bank Balances
Cash on hand 363,357 786,665
Balanceswithbanks:
- in current accounts 383,637 1,307,498
LICLiquidFundwithoriginalmaturitylessthan3months - 35,000,000
746,994 37,094,163
2.8 Short-term loans and advances
(Unsecured and considered good)
- To related parties
-Loansandadvances
NationalCollateralManagementServicesLimited(NCML)(refer note 2.18) 44,290,000 -
- To parties other then related parties
-Loansandadvancestoemployees - 29,000
-Loansandadvancestoothers - 4,500,000
Balance with government authorities
ServiceTaxInputCredit 2,472 2,472
Taxdeductedatsource 238,349 487,844
44,530,821 5,019,316
2.9 Other current assets
(Unsecured and considered good)
PrepaidExpenses 23,293 8,747
Interest accrued but not due 652,249 132,998
Receivable on sale on Investment - 2,500,000
675,542 2,641,745
40
(Currency:INR)
For the year ended31st March 2016
For the year ended31st March 2015
2.10 Revenue from Operations
Interest Income from
Related Parties (Refer Note 2.18) 3,178,829 1,416,252
3,178,829 1,416,252
2.11 Other income
Interestincomeon:
-FixedIncomeLICLiquidFund 1,127,326 1,403,935
-Incometaxrefund 43,976 -
Profitondisposaloffixedassets(net) - 20,50,010
Sundry income 1,700 -
1,173,002 34,53,945
2.12 Employee benefits expense
Salaries,wagesandbonus
- Incurred by Related Party (refer note 2.18 and 2.23) 12,975,136 -
- Others 2,148,476 3,797,282
Staffwelfareexpenses 82,322 -
15,205,934 3,797,282
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(Currency:INR)
For the year ended31st March 2016
For the year ended31st March 2015
2.13 Other expenses
Business Promotion (refer note no. 2.18 and 2.23) 188,881 -
AdvertisementExpenses(refernoteno.2.18and2.23) 99,508 -
Electricitycharges(refernoteno.2.18and2.23) 9,989 -
Insurance 8,747 7,486
Annual Fees to CICs 27,997 -
BankCharges 743 1,734
Miscellaneousexpenses 129,190 -
Rent to Related Parties (refer note no. 2.18 and 2.23) 603,908 74,400
Interest Paid to Govt. Authorities - 19,102
Audit Fee (Please refer Note below) 500,000 16,854
LossonsaleofFixedAsset(Net) 59,785 -
Postage,courierandtelephonecharges -
- Incurred by Related Party (refer note 2.18 and 2.23) 151,478
- Others 95,229
Legal&Professionalfees 714,000
- Incurred by Related Party (refer note 2.18) 2,612,738
- Others 813,500
Ratesandtaxes -
- Incurred by Related Party (refer note 2.18 and 2.23) 4,102,000
- Others 22,026
Repairs and maintenance - Others 171,544 -
ProvisionforStandardAssets(Expenses) 132,870 -
Travellingandconveyanceexpenses 684,480 37,110
10,414,613 870,686
Note:
Auditor’s Remuneration :
As Auditor 500,000 16,854
ForReimbursementofExpense - -
500,000 16,854
2.14 Tax Expense
CurrentTax - 32,093
Less:MatCreditAvailed - (32,093)
Add:DeferredTaxExpense*/(DeferredCredit)(refernote2.21) 10,503 17,995
NetTaxExpense 10,503 17,995*DuringtheyearMarch31,2015deferredtaxassetofRs.17,995has been reversed.
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2.15 Contingent Liabilities and Commitments
(i) Contingent Liability 31st March 2016 31st March 2015
(1)ClaimsagainstCompanynotacknowledgedasdebts -
-
(2)BankGuarantee -
-
(3) Other money for which company is contingently liable -
-
(ii) Commitments
Estimatedamountofcontractremainingtobeexecuted 2,070,000
-
2.16 Disclosure pursuant to Accounting Standard 15 ‘Employee benefits’ is not Applicable.
2.17 Segment Reporting
The Company has operated only in one business segment during the year viz capital based business comprisingofcommodityfinanceoperationsbeinginIndiawithfocusonruralandagri–businessfinance domain. The discloser requirements of Accounting Standard on Segment Reporting (AS – 17) are not applicable.
2.18 Disclosure as required by accounting standard 18 – Related Party Disclosure
i) List of Related Parties and Relationship:
Name of the Related Party Nature of Relationship Tenure
OrnateUniversalDevelopersPvt.Ltd. Associate Company Till 11.02.2016
Ornate Buildcon Developers Associate Company Till 11.02.2016
OrnateInfraHoldingsPvt.Ltd. Associate Company Till 11.02.2016
BoosterDealersPvt.Ltd. Associate Company Till 11.02.2016
RiteDevelopersPvt.Ltd. Associate Company Till 11.02.2016
Rita Ornate Developers Associate Company Till 11.02.2016
(Currency:INR)
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Suman Gupta Relative of KMP Till 11.02.2016
Deepali Gupta Relative of KMP Till 11.02.2016
Sunil Gupta KMP Till 11.02.2016
Sunil Gupta (HUF) HUF of KMP Till 11.02.2016
Sushil Gupta KMP Till 11.02.2016
Sushil Gupta (HUF) HUF of KMP Till 11.02.2016
PratikAgarwal Relative of KMP Till 11.02.2016
PeculiarMetalPvt.Ltd. Associate Company Till 11.02.2016
National Collateral Management Services Limited(NCML) Holding Company From 12.02.2016 onwards
Mr. Deviinder Gupta MD&CEO(KMP) From 12.02.2016 onwards
ii) TransactionswithRelatedParties:
Name of the related party Nature of Relationship
Nature transactions
31st March 2016
31st March 2015
OrnateInfraHoldingsPvt.Ltd. Associate Company
Loangiven - 14,500,000
(till 11/02/2016) LoanRecovered - (29,802,585)
Interest Income - 332,300
Ornate Universal Developers Pvt.Ltd.
Associate Company
Loangiven 1,000,000 21,200,000
(till 11/02/2016) LoanRecovered (1,000,000) (27,387,639)
Interest Income 3,777 79,228
BoosterDealersPvt.Ltd. Associate Company
Loangiven 31,300,000 9,345,000
(till 11/02/2016) LoanRecovered (31,300,000) (4,845,000)
Interest Income 1,967,741 92,711
44
RiteDevelopersPvt.Ltd. Associate Company
Loangiven - 22,000,000
(till 11/02/2016) LoanRecovered - (22,000,000)
Interest Income - 107,679
Ornate Buildcon Developers Associate Firm Loangiven 14,200,000 -
(till 11/02/2016) LoanRecovered (14,200,000) -
Interest Income 411,977 -
Rita Ornate Developers
Associate Company
Loangiven - 3,000,000
(till 11/02/2016) LoanRecovered - (3,000,000)
Interest Income - 11,836
Suman Gupta
Relative of KMP
Loangiven 10,250,000 7,650,000
(till 11/02/2016) LoanRecovered (10,250,000) (8,685,000)
Interest Income 119,331 208,475
Deepali Gupta Relative of KMP
Loangiven 1,420,000 -
(till 11/02/2016) LoanRecovered (1,420,000) -
Interest Income 9,676 -
Sunil Gupta KMP Loangiven 550,000 465,000
(till 11/02/2016) LoanRecovered (550,000) (465,000)
Interest Income 4,565 8,199
Sunil Gupta (HUF)
HUF of KMP Loangiven - -
(till 11/02/2016) LoanRecovered - (1,075,000)
Interest Income - 60,090
Sushil Gupta KMP Loangiven 1,275,000 7,900,000
(till 11/02/2016) LoanRecovered (1,275,000) (7,900,000)
Interest Income 9,513 256,784
Sushil Gupta (HUF) HUF of KMP Loangiven - 100,000
(till 11/02/2016) LoanRecovered - (6,245,000)
Interest Income - 197,783
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PratikAgarwal Relative of KMP
Loangiven - 752,000
(till 11/02/2016) LoanRecovered - (752,000)
Interest Income - 49,447
PeculiarMetalPvt.Ltd. Associate Company
Rent Paid 55,800 74,400
National Collateral ManagementServicesLimited(NCML)
Holding Company
Loangiven 44,290,000 -
(w.e.f. 12.02.2016)
Reimbursement payable to NCML
22,343,861 -
Interest Income 652,249 -
Mr. Deviinder Gupta MD&CEO(KMP)
Remuneration 799,814 -
Sub-lease rental payable 31st March 2016 31st March 2015
Outstanding as on Reporting Date
Receivable 44,942,249 -
NationalCollateralManagementServicesLimited (LoansandInterestaccrued)
Payable 22,343,861 -
NationalCollateralManagementServicesLimited (Payableagainstexpensesincurred)
2.19 Operating Lease:
1) Asset takenonOperatingLease
Leases where the lessor effectively retains substantially all the risk and benefits of ownership of the leases term, are classified as operating lease. During the year, Company has entered into one operating sub lease agreement for office premise and recognized as lease rent payment. Against this agreement, an aggregate of INR 163,908, in the statement of profit and loss for the current financial year (Previous year: INR 74,400). The Company does not have non cancellable lease. Operating lease expense is recognised in the statement of profit and loss on straight Line basis over lease term.
The future minimumleasepaymentsinrespectofsubleasedofficepremiseason31stMarch,2016isasfollows:
46
Sub-lease rental payable 31st March 2016 31st March 2015
Within One Year 1,224,175 74,400
Dueinaperiodbetweenoneyearandfiveyearyears 745,150 -
Beyondfiveyears - -
2) Asset given on Operating Lease
The Company has not entered into an agreement with any party to provide its asset on operating lease term. There is no asset given on operating lease.
2.20 Earnings Per Share
Particulars 31st March 2016 31st March 2015
(loss)/Netprofitavailableforequityshareholders(INR)(i) (21,342,834) 150,428
Weighted average number of equity shares outstanding duringtheyearforcalculationofbasicEPS(ii)
Effectofdilutivepotentialequityshares-EmployeestockoptionsWeighted average number of equity shares outstanding duringtheyearforcalculationofdilutedEPS(iii)
1,483,855
-
1,483,855
1,483,855
-
1,483,855
Basic earnings per share (i) / (ii)Diluted earnings per share (i) / (iii)
(14.38)(14.38)
0.100.10
Face value (INR) 10 10
2.21 Deferredtaxassets/Liabilities
Componentsofdeferredtaxassetsandliabilitiesareasunder:
Particulars 31st March 2016 31st March 2015
Deferred tax liabilities:
Opening BalanceDifferencebetweendepreciationallowableunderIncomeTaxAct,1961anddepreciationasperbooks
-10,503
---
Deferred tax liabilities (Net) (10,503) -
Deferred tax assets:
Opening balanceCarryForwardLossesReversed during the year
---
17,995-
(17,995)
Deferred tax assets (net) - -
2.22 Dues to micro, small and medium enterprises
TheCompanyhasnoduestomicroandsmallenterprisescoveredundertheMicro,SmallandMedium
47
EnterprisesDevelopmentAct,2006,asat31st March 2016 and 31st March 2015. This information is requiredtobedisclosedundertheMicro,SmallandMediumEnterprisesDevelopmentAct,2006,andhasbeendeterminedtotheextentsuchpartieshavebeenidentifiedonthebasisofinformationavailable with the Company.
Particulars 31st March 2016 31st March 2015
Principal amount remaining unpaid to any supplier as at the year end
- -
Interest due thereon - -
Amount of interest paid by the Company in terms of section16oftheMSMED,alongwiththeamountofthepayment made to the supplier beyond the appointed day during the accounting year
- -
Amount of interest due and payable for the year of delay inmakingpayment(whichhavebeenpaidbutbeyondtheappointed day during the year) but without adding the interestspecifiedundertheMSMED
- -
Amount of interest accrued and remaining unpaid at the end of the accounting year
- -
The amount of further interest remaining due and payable eveninthesucceedingyears,untilsuchdatewhentheinterest dues as above are actually paid to the small enterprise forth purpose of disallowance as a deductible expenditureundertheMSMEDAct,2006
- -
TheCompanyhasnotreceivedinformationfromvendorsregardingtheirstatusunderMicro,SmallandMediumEnterprisesDevelopmentAct,2006andhencedisclosuresrelatingtoamountsunpaidas at the yearend together with interest paid/ payable under this Act have not been given.
2.23 Shared Cost
NCML, being the holding company, incurs expenditure like common senior managementcompensationcost,rentandotheradministrativeexpendituresetc.whichareforthebenefitofitselfanditssubsidiaryNCMLFinancePvt.Ltd.ThiscostsoexpendedwillbereimbursedbyNCMLFinanceonthebasisofnumberofemployeesandtimespentbythem,areaoccupied,servicesusedandactualidentificationsetc.
2.24 Previous year figs. Regrouped
Thepreviousyearfigureshavebeenrestatedandreiteratedunderthecorrectgroupandheads.
2.25 Other matters:
Informationwithregardtoothermatters,specifiedinoftherevisedScheduleIIItotheActiseithernil or not applicable to the Company for the year.
2.26 Change of Management
Therewasachange inmanagement intheerstwhileTGFinance,whichwasrenamedasNCML
0048
FinancePvt.Ltd.(Nfin)NCMLboughta100%sharesofthecompanytobecomeitsnewshareholderand subsequently the directors in the company were changed. For details please refer Note No. 2.1 inattachedfinancial.
2.27 Transfer pricing
The Company has developed a system of maintaining information and documents as required by thetransferpricinglegislationundertheIncomeTaxAct,1961.Managementisoftheopinionthatits domestic transactions are at arm’s length so that the aforesaid legislation will not have any impactonthefinancialstatements,particularly on the amount of tax expense and that of provision for taxation.
For and on behalf of the Board of DirectorsNCML Finance Private LimitedCIN:U67190MH2009PTC191081
_____________________ _____________________________________
Mr. Sanjay Kaul Mr. Deviinder Gupta Chairman MD&CEO DINNo.:01729695 DINNo.:00619149 Place:Mumbai Place:Istanbul Date:28May,2016 Date:28May,2016