N2N Technologies Ltd
Directors Reports
TO THE MEMBERS OF N2N TECHNOLOGIES LIMITED
Your Directors have pleasure to present 38th Annual Report and Audited Annual Accounts
of your company for the year ended on 31st March 2023.
FINANCIAL HIGHLIGHTS:
STANDALONE BASIS
(Rs. IN LAKHS)
| Particulars |
FY 2022-23 |
FY 2021-22 |
| Total Income |
61.33 |
Nil |
| Total Expenditure |
59.78 |
6.11 |
| Extraordinary Items |
- |
457.51 |
| Profit / (Loss) Before T ax |
1.55 |
(465.42) |
PERFORMANCE REVIEW & FUTURE OUTLOOK:
During the current year, your Company has booked Nil Income and Loss of Rs.465.42 Lakhs
on standalone basis.
Your Directors are confident that the policies, strategies adopted by your company will
protect interest of the stakeholders.
DIVIDEND & RESERVES:
In view of the losses, your Directors expresses it inability to declare dividend for
the year.
SHARE CAPITAL:
As at March 31, 2023, Your company's total paid up share capital stood at
Rs.4,01,31,980/- divided into 32,28,069 fully paid up equity shares of Rs.10/- each and
7,85,129 fully paid up preference shares of Rs.10/- each. During the year under review,
the Company has not issued any shares with or without differential voting rights. Also
company has neither issued employee stock options nor sweats equity shares and does not
have any scheme to fund its employees to purchase the shares of the Company.
As on 31st March 2023, Mr. Rahul Shah, Promoter Director of the Company holds 43.11 %
shares of the Company.
MATERIAL CHANGES AND COMMITMENTS BETWEEN THE DATE OF THE BALANCE SHEET AND THE DATE OF
REPORT
There have been no material changes and commitments affecting the financial position of
the Company which have occurred between the end of the Financial Year of the Company to
which the Financial Statements relate and the date of the report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
A. Conservation of Energy and Technology Absorption:
The Company has no particulars to report regarding conservation of energy, technology
absorption as required under Section 134(3)(m) of the Companies Act, 2013 read with Rules
there under.
B. Foreign exchange earnings and outgo:
| Sr. No. |
Particulars |
Amt in Rs |
| 1 |
Foreign Exchange earned in terms of actual inflows during the year |
Nil |
| 2 |
Foreign Exchange outgo in terms of actual outflows during the year |
Nil |
CORPORATE SOCIAL RESPONSIBILITY (CSR)
Your company is committed to improve quality of lives of people in the community its
serves through long term stakeholder value creation, with special focus on skills
development. The Company does not have to mandatorily constitute a Corporate Social
Responsibility (CSR) Committee in accordance with Section 135 of the Companies Act, 2013.
The company fully understands its role in society and is committed for sustainable &
inclusive growth of people & the environment around its business.
BOARD AND DIRECTORS EVALUATION AND CRITERIA FOR EVALUATION
During the year, the Board has carried out an annual evaluation of its own performance
& performance of the Directors.
Your Company has constituted Nomination and Remuneration Committee, which as per the
provisions of Companies Act 2013 has defined the evaluation criteria, procedure and time
schedule for the Performance Evaluation process for the Board, its Committees and
Directors. The criteria for Board Evaluation inter alia include degree of fulfillment of
key responsibilities, Board structure and composition, establishment and delineation of
responsibilities to various Committees, effectiveness of Board processes, information and
functioning.
Criteria for evaluation of individual Directors include aspects such as attendance and
contribution at Board/ Committee Meetings and guidance/ support to the management outside
Board/ Committee Meetings. In addition, the Chairman was also evaluated on key aspects of
his role, including setting the strategic agenda of the Board, encouraging active
engagement by all Board members and motivating and providing guidance to the Management.
Criteria for evaluation of the Committees of the Board include degree of fulfillment of
key responsibilities, adequacy of Committee composition and effectiveness of meetings. The
procedure followed for the performance evaluation of the Board, Committees and Directors
is detailed in the Directors' Report.
CRITERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES AND INDEPENDENCE OF
DIRECTORS:
The Nomination and Remuneration Committee has formulated the criteria for determining
qualifications, positive attributes and independence of Directors in terms of provisions
of Section 178(3) of the Companies Act 2013.
Independence:
In accordance with the above criteria, a Director will be considered as an 'Independent
Director' if he/ she meet with the criteria for 'Independent Director' as laid down in the
Act.
Qualifications:
A transparent Board nomination process is in place that encourages diversity of
thought, experience, knowledge, perspective, age and gender. It is also ensured that the
Board has an appropriate blend of functional and industry expertise. While recommending
the appointment of a Director, the Nomination and Remuneration Committee considers the
manner in which the function and domain expertise of the individual will contribute to the
overall skill-domain mix of the Board.
Positive Attributes:
In addition to the duties as prescribed under the Act, the Directors on the Board of
the Company are also expected to demonstrate high standards of ethical behavior, strong
interpersonal and communication skills and soundness of judgment. Independent Directors
are also expected to abide by the 'Code for Independent Directors' as outlined in Schedule
IV to the Act.
REMUNERATION POLICY
The Company has adopted a Policy for remuneration of Directors, Key Managerial
Personnel and other employees, which is aligned to its overall Human resource philosophy.
The key factors considered in formulating the Policy are as under:
(a) the level and composition of remuneration is reasonable and sufficient to attract,
retain and motivate Directors of the quality required to run the Company successfully;
(b) relationship of remuneration to performance is clear and meets appropriate
performance benchmarks; and
(c) remuneration to Directors, key managerial personnel and senior management involves
a balance between fixed and incentive pay reflecting short and long-term performance
objectives appropriate to the working of the Company and its goals.
The key principles governing the Company's Remuneration Policy are as follows:
Remuneration for independent Directors and non-independent non-executive Directors:
• Independent Directors ('ID') and non-independent non-executive Directors ('NED')
may be paid sitting fees for attending the Meetings of the Board and of Committees of
which they may be members, and commission within regulatory limits, as recommended by the
Nomination and Remuneration Committee ('NRC') and approved by the Board.
• Overall remuneration should be reasonable and sufficient to attract, retain and
motivate Directors aligned to the requirements of the Company, taking into consideration
the challenges faced by the Company and its future growth imperatives. Remuneration paid
should be reflective of the size of the Company, complexity of the sector/ industry/
Company's operations and the Company's capacity to pay the remuneration and be consistent
with recognized best practices.
• The aggregate commission payable to all the NEDs and IDs will be recommended by
the NRC to the Board based on Company performance, profits, return to investors,
shareholder value creation and any other significant qualitative parameters as may be
decided by the Board. The NRC will recommend to the Board the quantum of commission for
each Director based upon the outcome of the evaluation process which is driven by various
factors including attendance and time spent in the Board and Committee Meetings,
individual contributions at the meetings and contributions made by Directors other than in
meetings.
• The remuneration payable to Directors shall be inclusive of any remuneration
payable for services rendered in any other capacity, unless the services rendered are of a
professional nature and the NRC is of the opinion that the Director possesses requisite
qualification for the practice of the profession.
Policy on Remuneration for Managing Director (‘MD') / Executive Directors
(‘ED') / Key
Managerial Personnel (‘KMP')/ rest of the Employees:
• The extent of overall remuneration should be sufficient to attract and retain
talented and qualified individuals suitable for every role. Hence remuneration should be
market competitive, driven by the role played by the individual, reflective of the size of
the Company, complexity of the sector/ industry/ Company's operations and the Company's
capacity to pay, consistent with recognized best practices and aligned to any regulatory
requirements. Basic/ fixed salary is provided to all employees to ensure that there is a
steady income in line with their skills and experience.
• In addition, the Company provides employees with certain perquisites, allowances
and benefits to enable a certain level of lifestyle and to offer scope for savings. The
Company also provides all employees with a social security net subject to limits, by
covering medical expenses and hospitalization through re-imbursements or insurance cover
and accidental death and dismemberment through personal accident insurance. The Company
provides retirement benefits as applicable.
• In addition to the basic/ fixed salary, benefits, perquisites and allowances as
provided above, the Company provides MD/ EDs such remuneration by way of commission,
calculated with reference to the net profits of the Company in a particular financial
year, as may be determined by the Board, subject to the overall ceilings stipulated in
Section 197 of the Companies Act, 2013. The specific amount payable to the MD/ EDs would
be based on performance as evaluated by the NRC and approved by the Board.
• The Company provides the rest of the employees a performance linked bonus. The
performance linked bonus would be driven by the outcome of the performance appraisal
process and the performance of the Company.
Presently, no Directors or KMP of the Company is drawing any remuneration from the
company
DIRECTORS' RESPONSIBILITY STATEMENT
The directors report that:
i) In the preparation of the annual accounts, the applicable accounting standards have
been followed along with proper explanation relating to material departures.
ii) The Directors have selected such accounting policies and applied them consistently
and made judgments and estimates that are reasonable and prudent so as to give a true and
fair view of the state of affairs of the company at the end of the financial year and of
the profit and loss statement of the company for that period.
iii) The Directors have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of this Act for safeguarding
the assets of the company and for preventing and detecting fraud and other irregularities.
iv) The Directors have prepared the annual accounts on a going concern basis.
v) The Directors, had laid down internal financial controls to be followed by the
company and that such internal financial controls are adequate and were operating
effectively and
vi) The directors had devised proper systems to ensure compliance with the provisions
of all applicable laws and that such systems were adequate and operating effectively.
DECLARATION ON INDEPENDENT DIRECTORS
All the Independent Directors have given declarations that they meet the criteria of
independence as laid down under Section 149(6) of the Act. In the opinion of the Board,
they fulfill the conditions of independence as specified in the Act and the Rules made
there under and are independent of the management.
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
At present, your company does not have any Subsidiary, Joint Venture or Associates
company.
POLICY ON PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT WORKPLACE
The Company has zero tolerance for sexual harassment and has adopted a Policy on
Prevention, Prohibition and Redressal of Sexual Harassment at the Workplace, in line with
the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013 and the Rules there under. The Company has not received any complaint
of sexual harassment during the financial year 2020-21.
VIGIL MECHANISM/ WHISTLE BLOWER POLICY
The Company has adopted a Whistle Blower Policy, to provide a formal mechanism to the
Directors and employees to report their concerns about unethical behavior, actual or
suspected fraud or violation of the Company's Code of Conduct or ethics policy. The Policy
provides for adequate safeguards against victimization of employees who avail of the
mechanism. It is affirmed that no personnel of the Company have been denied access to the
Audit Committee.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
No significant material orders have been passed by the Regulators or Courts or
Tribunals which would impact the going concern status of the Company and its future
operations.
AUDITORS
(1) Statutory Auditors:
M/s. Maheshwari & Co., Chartered Accountants, Mumbai, are the statutory auditors of
the Company and hold office till the conclusion of the 37th Annual General Meeting (AGM)
subject to ratification at each intervening AGM. They have expressed their inability to
continue as Statutory Auditor of the Company. Your Board has appointed M/s DMKH & Co.
as Statutory Auditor of the Company and recommend their appointment.
(2) Secretarial Auditors:
Pursuant to the provisions of Section 204 of the Act and The Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company
had appointed M/s. Hardik Savla & Co, a Company Secretary in Practice to undertake the
Secretarial Audit of the Company for the year ended 31st March, 2023. The Secretarial
Audit Report is annexed to this report.
The Auditors' Report for the financial year ended 31st March 2023 contains following
qualification, reservation, adverse remark or disclaimer:
| Sr. No. |
Auditors qualification, reservation, adverse remark or disclaimer |
Board's comments |
|
(Auditors have given following remarks under Standalone Audit Report "Emphasis of
Matter" para ) |
|
| 1 |
The Company being a listed Company, as per Section 138 of Companies Act, 2013 read
with Rule 13 of Companies (Accounts) Rules, 2014, Company is required to appoint Internal
Auditor. |
Your Company shall make an appointment of Internal Auditor in current year. |
|
However the Company has not complied with the same. |
|
| 2. |
The Company has not established its Internal Financial Controls over financial
reporting on criteria based on or considering the essential components of internal control
stated in the Guidance Note on Audit of Internal Financial Controls over Financial
Reporting issued by the Institute of Chartered Accountants of India. |
Your Company shall engage a Chartered Accountant for issuance of appropriate report on
Internal Financial Controls and basis that, the qualification will be addressed. |
|
The Company has not Made Provision for Professional Tax during the current financial
year amounting to Rs. 2500; TDS payable amounting to Rs. 42,591 is outstanding for payment
for more than 1 year, However interest and penalty for the same is not accounted for and
accordingly Loss is understated to that extent, However exact calculation of interest
liability is not ascertainable as the said balances are carried forward balances. |
Your Company has paid the TDS for previous years which are available for credit and
set off for the TDS liability accrued. |
| 5 |
the company has granted loan to DSR Infotech Limited, which is non-compliance of
Section 185 of the Companies Act, 2013. |
DSR Infotech Ltd was a subsidiary company when such transaction had happened. As on
date, the DSR is not the subsidiary company of N2N. |
|
|
It is important to note that, all expenses of the Company are currently paid out of
the loan amount refunded by DSR Infotech Limited. The Listing Fees, payments to Company
Secretary and other expenses are paid out of the Loan amount refunded by the DSR Infotech
Ltd. |
|
|
Further, It is important to note that, the Loan was standing before the commencement
of the Companies Act, 2013. |
| 6 |
Balances of Debtors, Loans and Advances, Secured & Unsecured Loans, Sundry
Creditors Others are subject to confirmation and reconciliation and consequential
adjustments |
Certain balances have been carried forwarded since the Company was acquired by Rahul
Shah through Open Offer. |
|
|
Basis principle of prudence, the Board of Directors may write off such amounts from
the Books of Accounts. |
The Secretarial Auditors' Report for the financial year ended 31st March 2023 contains
following qualification, reservation, adverse remark or disclaimer:
| Sr. No. |
Secretarial Auditors qualification, reservation, adverse remark or disclaimer |
Board's comments |
| 1 |
The company has not published intimation & results of quarterly results in
newspaper as required by SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 |
Your Company shall comply with the same during the current year and henceforth. |
| 2 |
We would like to draw your attention, the company has applied for re-adjudication of
Stamp Duty on account of merger of Leadsoft softech Pvt Ltd with the Company as levied by
the Controller of Stamps, Mumbai |
Re-adjudication of Stamp Duty with Controller of Stamps, Mumbai is under process. |
Mr. Nishant Upadhyay has brought to attention of the Promoter Director the
qualification remarks of the Auditors in their Audit Report and requested to adopt
urgently corrective steps to address such qualification and emphasis of matters. The role
of the Independent Director being honorary and without remuneration and more advisory in
nature and has adopted steps within their purview to address these qualifications.
LISTING ON STOCK EXCHANGES
The Equity Shares of your Company are listed only with BSE Limited. The listing fees
for the financial year 2022-23 is partly paid.
CORPORATE GOVERNANCE
The Company is committed to maintain the highest standards of corporate governance and
adhere to the corporate governance requirements set out by SEBI. The certain regulations
as to corporate governance do not apply to the Company in Accordance with SEBI (LODR)
Regulations 2015. Accordingly, no separate section on Corporate governance is annexed.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
The Management Discussion & Analysis Report as required under regulation 34 of the
SEBI (LODR) Regulations, 2015 is annexed to this report.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENT UNDER SECTION 186
During the year, the Company has not given any loan or guarantee, or provided security,
or has made any investment which would be required to be reported under section 186 of the
companies Act 2013. The closing balances of investments which would be covered under
Section 186 of the Companies Act, 2013, are disclosed in the Schedule of Non-Current
Investments/Loans given in the Financial Statements.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN
SUB-SECTION (1) OF SECTION 188 OF THE COMPANIES ACT, 2013
The contracts or arrangements as covered u/s188 of the Companies Act 2013, is not
entered into by the Company. Hence, no particulars are being provided in Form AOC-2 as
mandated pursuant to the provisions of Section 134 of the Companies Act, 2013, read with
Rule 8 (2) of the Companies (Accounts) Rules, 2014.
THE EXTRACT OF ANNUAL RETURN
Extracts of Annual return in form MGT-9 as per the provisions of the Companies Act,
2013 is annexed hereto and forms part of this report.
MANAGERIAL REMUNERATION / PARTICULARS OF EMPLOYEES
Your company has not paid any managerial remuneration during the period under review,
therefore no Disclosures in the Board Report as required under Rule 5 of Companies
(Appointment & Remuneration) Rules, 2014 is provided and further your Company also has
not employed any person at a remuneration in excess of the limit set out in the said
Rules.
DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP) :
Your Board comprises of Mr Rahul Shah, Mr Tushar Shah, Mr Nishant Upadhyay, Mr. Arvind
Dubey and Ms. Trupti Pandit. Mr. Nishant Upadhyay resigned as Independent Director of the
Company during the financial year 2022-2023.
Ms. Monal Agrawal was appointed as Company Secretary and Compliance Officer of the
Company.
Mr. Tushar Shah and Ms. Trupti Pandit are also designated as Key Managerial Personnel
and CEO and CFO.
BOARD AND COMMITTEE MEETINGS
Five Board Meetings were convened and held during the year i.e. on 30-05-2022,
14-June-2022, 14- August-2022, 14-November-2022, 14-February-2023, March 30, 2023. At
Present, The Audit Committee consist of Mr. Arvind Dubey as Chairman and Mr Tushar Shah,
Mr. Rahul Shah as Members.
The Stakeholders relationship committee as well as Remuneration Committee comprises Mr
Tushar Shah as Chairman and Mr. Nishant Upadhyay, Mr. Rahul Shah as Members. There have
not been any instances when recommendations of the Audit Committee were not accepted by
the Board. The intervening gap between the Meetings was within the period prescribed under
the Act.
DETAILS OF DEPOSITS WHICH ARE NOT IN COMPLIANCE WITH THE REQUIREMENTS OF CHAPTER V OF
THE COMPANIES ACT, 2013:
Your Company has not accepted any fixed deposits covered under chapter V of the
Companies Act, 2013 and, as such, no amount of principal or interest was outstanding on
the date of Balance Sheet.
INTERNAL CONTROLS SYSTEMS AND ADEQUACY
The Company's internal audit systems are geared towards ensuring adequate internal
controls commensurate with the size and needs of the business, with the objective of
efficient conduct of operations through adherence to the Company's policies, identifying
areas of improvement, evaluating the reliability of Financial Statements, ensuring
compliances with applicable laws and regulations and safeguarding of assets from
unauthorized use.
The Audit Committee along with Management oversees results of the internal audit and
reviews implementation on a regular basis.
ACKNOWLEDGEMENT
Your Directors wish to place on record their appreciation for the wholehearted and
sincere cooperation the Company has received from its bankers and various Government
agencies. Your Directors also wish to thank all the employees for their co-operation.
|
By Order of the Board of Directors |
|
| Place: Pune |
|
|
| Date: May 30, 2023 |
Tushar Shah |
Rahul Shah |
|
Director |
Director |
|
DIN-01932018 |
DIN-01545609 |
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