To
The Members,
Avasara Finance Limited
(Formerly known as TRC Financial Services Limited)
Your Directors' have pleasure to present the Twenty Nineth Annual Report of your
Company, Avasara Finance Limited for the financial year ended March 31, 2023. In line with
the requirements of the Companies Act, 2013 and the rules framed thereunder, this report
covers the financial results and other developments during the Financial Year 1st
April 2022 to 31st March 2023.
1. SUMMARY OF OPERATIONS/RESULTS
The financial results of the Company for the year ended March 31,2023 compared to the
previous year are summarized below:
(Rupees in Lacs)
Particulars |
March 31, 2023 |
March 31, 2022 |
Revenue from Operations |
32.23 |
22.66 |
Other Income / Loss |
- |
0.82 |
Total Expenditure |
29.38 |
58.80 |
Net Profit/(Loss) before tax |
2.85 |
(35.32) |
Current Tax |
0 |
3.22 |
Tax Expense for earlier years |
0 |
(4.87) |
Net Profit/(loss) after Tax |
2.85 |
(36.40) |
2. COMPANY'S AFFAIRS
Your Company has earned a total business revenue of Rs. 32.23 lacs and the net profit
before tax of Rs. 2.85 lacs for the financial year 2022-23 as against the revenue of Rs.
22.66 lacs and net loss before tax of Rs. 35.32 lacs in the previous financial year
2021-2022.
3. PERFORMANCE AND FUTURE PROSPECTS
Your Company has prepared the Financial Statements in accordance with Indian Accounting
Standards ("IND AS") notified under the Companies (Indian Accounting Standards)
Rules, 2015 as amended by the Companies (Indian Accounting Standards) Rules, 2016. The
Company has adopted IND AS from 1st April 2018 with effective transition date
of 1stApril, 2017 and accordingly, these Financial Statements together with the
Financial Statements for the comparative reporting period have been prepared with the
recognition and measurement principles stated therein, prescribed under Section 133 of the
Companies Act, 2013 ("the Act") read with relevant Rules issued thereunder and
the other accounting principles generally accepted in India.
During the year 2022-23 the company had revenue of Rs. 15 lacs from consulting services
as compared to Nil in the previous financial year. Employee benefit cost during the year
was 15.14 lacs as compared to 15.37 lacs in the previous financial year. Profit before tax
for the financial year was at Rs. 2.85 lacs as against a loss before tax of Rs. 35.32 lacs
for the financial year 2021-22.
Further the management of the Company is looking at various opportunities for expanding
the business including other area of lending and building a loan book.
4. CHANGE IN THE MANAGEMENT OF THE COMPANY
During the year under review there was no change in the management of the Company.
5. DIVIDEND & TRANSFERS TO IEPF
Your Board does not recommend any dividend for the financial year ended March 31,
2023.The Company was not required to transfer the amount of any unclaimed/unpaid dividend
to Investor Education Protection Fund.
6. TRANSFER TO RESERVE
The Board of Directors of your Company has transferred Rs. 0.57 lacs from Retained
earnings to the statutory reserve as directed by RBI for the year 2022-23.
7. CORPORATE GOVERNANCE
Regulation 15 of SEBI (Listing Obligations and Disclosure Requirements), Regulations,
2015, provide threshold for applicability of corporate governance rules. Your company does
not exceed such threshold. Hence, provision of corporate governance is not applicable on
your company.
8. CHANGE IN THE NATURE OF BUSINESS
No changes occurred in the nature of business during the financial year ended March 31,
2023, and till the date of issue of this report.
9. MATERIAL CHANGES AND COMMITMENTS
No material changes/ commitments occurred between the end of the financial year to
which financial statements relate and the date of this report.
10. DEPOSITS
The Company has not accepted any deposits and, as such, no amount of principal or
interest is outstanding as of the Balance Sheet date.
11. SUBSIDIARY, ASSOCIATE AND JOINT VENTURES COMPANIES
The Company does not have any subsidiary as per Clause 2(87) or associate as per Clause
2(6) of the Companies Act, 2013; also, it has not entered into any joint venture
agreements with any other entities.
12. SHARE CAPITAL
During the F.Y. 2022-2023, there was no change in the Share Capital of the Company.
13. BOARD OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND COMMITTEES THEREOF
13.1 Board of Directors and Key Managerial Personnel
The Current Composition of Board of Directors and Key Managerial Personnel of the
Company is as follows:
Sr. no. Name of Director
and Key Managerial Personnel |
DIN/ PAN |
Category |
1 Mr. Naresh Gandhi |
08130774 |
Non - Executive, Independent Director |
2 Mr. K. Sanjay Prabhu |
00023196 |
Non- Executive, Non - Independent Director |
3 Mrs. Uma Prasad Bontha |
08406107 |
Non- Executive, Independent Director |
4 Mr. Sabarinath Gopalakrishnan |
08479403 |
Whole Time Director & Chief Financial
Officer |
5 Mr. Valmeekanathan Subramanian |
05297798 |
Non- Executive, NonIndependent Director |
6 Ms. Charmi Kartik Gindra |
AQAPC3360K |
Company Secretary and Compliance Officer |
L3.2 Board of Directors
• Details of Board Meetings/CommitteeMeetings
The Board of Directors met five times during the year. The details as per Standard 9 of
the Secretarial Standards-1 on Board meetings/committee Meetings held during the financial
year 202223 are furnished below:
Board Meeting Dates |
30thMay, 2022; 09thAugust,
2022; 02nd September, 2022; 14th November, 2022 and 10th
February 2023 |
Audit Committee Meeting Dates |
30thMay, 2022; 09thAugust,
2022; 14th November, 2022 and 10th February 2023 |
NRC Committee Meeting Dates |
09th August, 2022 |
Stakeholders Relationship Committee
Meeting Date |
09th August, 2022 |
• Attendance of Directors at Meetings
Sr. No. Name of the
Director |
Board meeting attended |
Audit Committee meetings
attended |
NRC Committee meetings
attended |
Stakeholders Relationship Committee
Meeting Date |
1 Mr. Naresh Gandhi |
5 |
4 |
1 |
1 |
2 Mr. Sanjay Prabhu |
4 |
4 |
1 |
- |
3 Mrs. Uma Prasad |
4 |
4 |
1 |
1 |
4 Mr. Sabarinath Gopalakrishnan |
5 |
- |
- |
1 |
5 Mr. Valmeekanathan Subramaniam |
5 |
- |
- |
- |
• Changes in Directors/ Key Managerial Personnel
During the year under review and since the last Boards report, the following changes in
the composition of Board of Directors and Key Managerial Personnel took place:
1. Mr. Valmeekanathan Subramaniam was appointed as Additional Director on 10th
November, 2021 and was regularized as Director on 28th September, 2022.
2. Mr. Naresh Gandhiwas re-appointed as Non-Executive Independent Director with effect
from 11thMay, 2023 for a further consecutive period of 5 years.
• Retirement by Rotation
In accordance with the provisions of Section 152 of the Companies Act 2013 and the
Company's Articles of Association, Mr. Valmeekanathan Subramaniam (DIN: 05297798) retires
by rotation at 29th Annual General Meeting and being eligible has offered
himself for re-appointment.
The Board of Directors recommends to the shareholders to re-appoint him at the 29th
Annual General Meeting.
• Committee Meeting Independent Directors
During the year under review, the Independent Directors was held on 10th
February 2023 inter alia, to discuss:
1. Evaluation of performance of Non-Independent Directors and the Board of Directors as
a whole;
2. Evaluation of performance of the Chairman of the meetings of the Company, taking
into account the views of Executive and Non-Executive Directors.
3. Evaluation of the quality, content and timelines of flow of information between the
Management and the Board that is necessary for the Board to effectively and reasonably
perform its duties
• Declaration from Independent Directors
The Company has received necessary declaration from each independent director under
Section 149(7) of the Companies Act, 2013, that he/she meets the criteria of independence
laid down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of SEBI (Listing
Obligations and Disclosures Requirements) Regulations, 2015.
In the opinion of the Board, all the Independent Directors possess the integrity,
expertise and experience including the proficiency required to be Independent Directors of
the Company, fulfil the conditions of independence as specified in the Act and the SEBI
Listing Regulations and are independent of the management and have also complied with the
Code for Independent Directors as prescribed in Schedule IV of the Act.
• Familiarization program for independent directors
All new independent directors appointed on the Board attend a familiarization program.
After appointment, a formal letter is issued to the independent directors outlining
his/her roles, functions, duties and responsibilities.
• Board evaluation
The performance of the board was evaluated by the board after seeking inputs from all
the directors based on the criteria such as the board composition and structure,
effectiveness of board processes, information and functioning, etc.
The performance of the committees was evaluated by the board after seeking inputs from
the committee members based on the criteria such as the composition of committees,
effectiveness of committee meetings, etc.
The board and the nomination and remuneration committee reviewed the performance of the
individual directors based on the criteria such as the contribution of the individual
director to the board and committee meetings.
In a separate meeting of independent directors, performance of non-independent
directors, and performance of the board was evaluated, taking into account the views of
executive directors and non executive directors. Performance evaluation of independent
directors was done by the entire board, excluding the independent director being
evaluated.
Policy on director's appointment and remuneration
The current policy of the Company is to have an optimum combination of both executive
and independent directors to maintain the independence of the Board and separate its
functions of governance and management.
The policy of the Company on director's appointment and remuneration, including
criteria for determining qualifications, independence of director and other matters, as
required under Section 178(3) of the Companies Act, 2013 is available on our website
(www.trcfin.in). There has been no change in the policy since the last financial year. We
avow that the remuneration paid to the directors is as per the terms laid out in the
nomination and remuneration policy of the Company.
• Policies
All our policies are available on our website (www.trcfin.in). The policies are
reviewed periodically by the Board and updated based on need.
13.3 Committees of Board of Directors
• Audit Committee
The Audit Committee of Directors is constituted as per the provisions of Section 177 of
the Companies Act, 2013. The Composition of Audit Committee is as follows:
Sr. no Name of Member |
DIN |
Category |
1 Mr. Naresh Gandhi, Chairman |
08130774 |
Non - Executive, Independent Director |
2 Mr. K. Sanjay Prabhu |
00023196 |
Non - Executive, Non- Independent Director |
3 Mrs. Uma Prasad Bontha |
08406107 |
Non - Executive, Independent Director |
• Nomination and Remuneration Committee
The Nomination & Remuneration Committee of Directors is constituted in accordance
with the requirements of Section 178 of the Companies Act, 2013. The Composition of
Nomination and
Remuneration Committee is as follows:
Sr no. Name of Members |
DIN |
Category |
1 Mr. Naresh Gandhi - Chairman |
08130774 |
Non - Executive, Independent Director |
2 Mr. K Sanjay Prabhu |
00023196 |
Non - Executive, Non- Independent Director |
3 Mrs. Uma Prasad Bontha |
08406107 |
Non-Executive Independent Director |
Stakeholders Relationship Committee
Pursuant to Section 178 of the Companies Act, 2013, the Board of Directors has
constituted the Stakeholders Relationship Committee. The Composition of Stakeholders
Relationship Committee is as follows:
Sr no. Name of the Member |
DIN |
Category |
1 Mr. Naresh Gandhi - Chairman |
08130774 |
Non - Executive, Independent Director |
2 Mr. Sabarinath Gopalakrishnan |
08479403 |
Whole Time Director & Chief Financial
Officer |
3 Mrs. Uma Prasad Bontha |
08406107 |
Non - Executive, Independent Director |
• Investment Committee
The Board of Directors has constituted the Investment Committee to co-ordinate and
oversee the organizations investment portfolio as required under RBI's NBFC regulations.
Composition of the same is as follows
Sr no. Name of Director |
DIN |
Category |
1. Mr. Sabarinath Gopalakrishnan |
08479403 |
Whole-time Director |
2. Mr. Naresh Gandhi |
08130774 |
Non - Executive, Independent Director |
3. Mrs. Uma Prasad Bontha |
08406107 |
Non - Executive, Independent Director |
14. CERTIFICATE FROM COMPANY SECRETARY IN PRACTICE
Priti J Sheth of M/s Priti J Sheth & Associates practicing Company Secretaries has
issued a certificate as required under the Listing Regulations, confirming that none of
the Directors on the Board of the Company has been debarred or disqualified from being
appointed or continuing as director of Companies by SEBI/ Ministry of Corporate Affairs or
any such statutory authority. The certificate is enclosed as "Annexure A"
15. CORPORATE SOCIAL RESPONSIBILITY
The provisions of Section 135 of the Companies Act, 2013 and the Companies (Corporate
Social Responsibility Policy) Rules, 2014 in respect of Corporate Social Responsibility
are not applicable to the Company.
16. DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM AND WHISTLE BLOWER POLICY
The Company has adopted a Whistle Blower mechanism for directors and employees to
report concerns about unethical behavior. The said policy has been posted on the website
of the Company- www.trcfn.in.
17. SIGNIFICANT AND MATERIAL ORDERS
There are no significant and material orders passed by the regulators, courts or
tribunals impacting the functioning of the Company.
18. STATUTORYAUDITORS
M/ s. NBS & Co. Chartered Accountants, (ICAI Firm Registration No. 110100W) were
appointed as the Auditors of the Company by the shareholders of the Company at the 26th
Annual General Meeting of the Company held on September 30, 2020 and shall hold office for
a period of 5 years till 2024-25.
Due to RBI Circular RBI/2021-22/25 Ref. No. DoS.CO.ARG/SEC.01/08.91.001/2021-22 dated
27thApril, 2021, NBFC can appoint Statutory Auditor for the period of 3 years.
The Board has decided to recommend the appointment of M/s- P.B. Shetty
& Co., Chartered Accountants (FRN No. 110102W) as Statutory Auditors of the
Company under Section 139 of the Companies Act, 2013 for a period of three consecutive
years i.e. to hold the office till the conclusion of the fourth Annual General Meeting to
be held in the financial year 2026. The Board places on record its appreciation of the
services of the retiring Auditors M/ s. NBS & Co. who have been Auditors of the
Company since the financial year 2020-21.
19. STATUTORY AUDITORS' REPORT
The Statements made by the Auditors in their report are self-explanatory and doesn't
require any comments by the Board of Directors.
20. INTERNAL FINANCIAL CONTROL (IFC)
Your Company's internal control system (including Internal Financial Controls with
reference to financial statements) ensures efficiency, reliability and completeness of
accounting records and timely preparations of reliable financial and management
information, compliance with all applicable laws and regulations, optimum utilization, and
the protection of the Company's assets.
The Company has appointed M/ s. VMRS & Co., Chartered Accountants as the Internal
Auditors as mandated under Section 138 of the Companies Act, 2013 for conducting the
Internal Audit of the Company.
21. REPORTING OF FRAUDS
There was no instance of fraud during the year under review, which required the
Statutory Auditors to report to the Audit Committee and / or Board under Section 143(12)
of Act and Rules framed thereunder.
22. RISK MANAGEMENT POLICY
The Company has adopted a Risk Management Policy which helps the Company in
identification of risk, lays down procedure for risk assessment and procedure for risk
mitigation.
23. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
Since the Company is a registered entity under the Reserve Bank of India to conduct the
business of Non-Banking Financial Services, pursuant to the section of 186 (11)(a), (b) of
the Companies Act, 2013, the company is exempted from complying with the provisions.
Further, details of Investments made by the Company during the year under review form a
part of the financial statements.
24. PARTICULARS OF TRANSACTION BETWEEN THE COMPANY AND THE NONEXECUTIVE DIRECTORS
During the year under review the company has not entered into any transaction with its
Non Executive Directors.
25. PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
In order to prevent sexual harassment of women at workplace, your Company has adopted a
Policy for prevention of Sexual Harassment of Women at Workplace. During the year under
review, the Company has not received any complaints in this regard.
Further, the provisions relating to constitution of Internal Complaints Committee under
the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act,
2013 are not applicable.
26. COMPLIANCE WITH THE ICSI SECRETARIALSTANDARDS
The relevant Secretarial Standards issued by the Institute of Company Secretaries of
India (ICSI) related to the Board Meetings and General Meetings have been complied with by
the Company.
27. DIRECTORS' RESPONSIBILITY STATEMENT:
In terms of Section 134(5) of the Companies Act, 2013 in relation to financial
statements for the year ended 31st March 2023, the Board of Directors state
that:
a. In the preparation of the Annual Accounts, the applicable accounting standards had
been followed.
b. The Directors had selected such Accounting Policies and applied them consistently
and made judgments and estimates that are reasonable and prudent to give a true and fair
view of the state of affairs of the Company at the end of the financial year and of the
profit and loss of the Company for that period.
c. The Directors had taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of this Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities.
d. The Directors had prepared the Annual Accounts on a going concern basis.
e. The Directors had laid down internal financial controls to be followed by the
Company and such internal financial controls are adequate and were operating effectively.
f. The directors had devised proper systems to ensure compliance with the provisions of
all applicable laws and that such systems were adequate and operating effectively.
28. EXTRACT OF ANNUAL RETURN
As required under Section 134(3) (a) of the Act, the Annual Return for the financial
year 2022-23 is uploaded on the Company's website and can be accessed at http:/ /
www.trcfin.in.
29. SECRETARIAL AUDITORS
As required under Section 204 of the Companies Act, 2013 and Rules made thereunder the
Board has appointed M/s. Priti J. Sheth& Associates, Practicing Company Secretaries as
Secretarial Auditor of the Company for the F Y 2022-23.
30. SECRETARIAL AUDIT REPORT
The Secretarial Audit Report for the financial year 2022-23 forms part of Annual Report
as "Annexure B" to the Boards Report.
31. DIRECTORS COMMENT ON QUALIFICATION OROBSERVATION
The responses of your directors on the observations made by the Secretarial Auditor are
as follows: -
1) The Company has generally complied with the NBFC norms issued by Reserve Bank of
India except for delay in few filings with RBI.
There were a few delays in the filings to be made to RBI as there were some software
glitches with the regulators website.
2) Website of the Company is not working.
The Company's website was under maintenance and now it is working.
3) The Company is yet to submit the website URL as required by exchange Notice No.
20230209-1 dated February 09, 2023.
The Company's website was under maintenance and hence could not submit the website URL
as required by the Stock Exchange; however the same has now been complied with.
4) The Company has not maintained the Structured Digital Database (SDD) as required
under Regulation 3(5) of SEBI (Prohibition of Insider Trading) Regulations, 2015 nor has
submitted the Compliance Certificate with respect to the same.
The company is non-operational, with merely accrued income and no revenue realized.
Consultancy income of Rs. 15 lakhs has been realized in the first quarter of 2023-24. The
Company was in short of funds hence, as a cost saving measure; the Board had decided to
set up the SDD at later stage. Except for the promoter, no insider holds any shares in the
Company and the Promoter has taken reasonable steps to ensure that no insider with access
to UPSI trades in shares
32. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS
ANDOUTGO
(A) CONSERVATION OFENERGY
i. The Steps Taken or Impact on Conservation of Energy: The Company takes
necessary measure to conserve energy at its offices.
ii. The Steps Taken by The Company for Utilizing Alternates Source of Energy: NIL
iii. The Capital Investment on energy conservation equipment's: NIL
(B) TECHNOLOGY ABSORPTION
i. The efforts made towards technology absorption :NIL
ii. The benefits derived like product improvement, cost reduction, product
development or import substitution: NIL
iii. In case of imported technology (imported during last three years reckoned from
beginning of financial year)
• Details of technology imported: Nil
• Year of Import: Nil
• Whether technology has been fully absorbed: Nil
• If not fully absorbed, areas where absorption has not taken place and the
reasons thereof : Nil
iv. The expenditure incurred on Research and Development : Nil
( C) FOREIGN EXCHANGE EARNINGS AND OUTGO
The details of foreign exchange earnings and outgo during the period under review is as
under:
Particulars |
As at March 31, 2023 |
As at March 31, 2022 |
Foreign Exchange earned |
Nil |
Nil |
Foreign Exchange used |
Nil |
Nil |
33. CEO/ CFO CERTIFICATION
The company is exempted under Regulation 15(2) of the SEBI (Listing Obligations and
Disclosures) Regulations, 2015 from including CEO / CFO certificate as a part of Annual
Report.
34. RELATED PARTY TRANSACTIONS
There were no transactions falling under the purview of Section 188 of the Companies
Act, 2013 and the rules framed thereunder.
35. MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis Report for the year under review, as stipulated
under Securities and Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (the 'Listing Regulations'), is presented in a separate
section forming part of this Annual Report.
36. RESERVE BANK OF INDIA REGULATIONS
The Reserve Bank of India has classified the Company as "Category 'B' Non-Banking
Finance Company".
The Company continues to comply with all the applicable regulation prescribed by the
Reserve Bank of India ("RBI") from time to time.
37. MAINTENANCE OF COST RECORDS:
Maintenance of cost records as specified by the Central Government under sub-section
(1) of section 148 of the Companies Act, 2013, is not applicable to the Company.
38. PARTICULARS OF REMUNERATION TO DIRECTORS, KEY MANAGERIAL PERSONS AND EMPLOYEES
The Company wishes to place on record their appreciation to the contribution made by
the employees to the operations of the company during the period.
During the year under review, there were no employees who were in receipt of the
remuneration beyond the limits prescribed under Rule 5 (2) of Companies (Appointment and
Remuneration) Rules, 2014 and therefore no disclosures need to be made under the said
section.
Further, the details of the top 10 employees in terms of remuneration drawn pursuant to
rule 5(1) and 5(2) of Companies (Appointment and Remuneration) Rules, 2014 shall be
available at the registered office of the Company during the business hours and the
details ratios of the remuneration of each Director to the median remuneration to the
employees of the Company for the financial year are enclosed as "Annexure C"
to the Board's Report.
39. DISCLOSURE OF CERTAIN TYPES OF AGREEMENTS BINDING LISTED ENTITIES
The Company has not entered in any of the agreements that it impacts management and
control of the listed entity which are binding and not in normal course of business. Any
other parties where listed entity is not a party has not been entered.
40. ACKNOWLEDGEMENT
Your Board wishes to place on record its sincere appreciation for the wholehearted
support received from members, government authorities, bankers, consultants, and all other
business associates. We look forward to continued support of all these partners in
progress.
For and on behalf of the Board of
Directors |
|
Avasara Finance Limited |
|
(Formerly known as TRC Financial
Services Limited) |
|
Sd/- |
Sd/- |
Sabarinath Gopalakrishnan |
Valmeekanathan S |
Wholetime Director |
Director |
DIN: 08479403 |
DIN: 05297798 |
Place: Bangalore |
|
Date: 14thAugust, 2023 |
|
|