(For the Financial Year Ended 31-03-2023)
To,
The Members
Quantum Build-Tech Limited,
Hyderabad.
1. INTRODUCTION :
Your Board of Directors (‘Board') have pleasure in presenting their Twenty Fifth (25th) Annual Report on the business and operations of the Company and the Audited Financial Statements and developments for the financial year ended on 31st March, 2023.
2. FINANCIAL SUMMARY :
During the year under review, financial performance of your company is as under:
(Amount In Lakhs)
3. BRIEF DESCRIPTION THE STATE OF COMPANYS AFFAIRS / PERFORMANCE:
The Company has not undertaken any construction activity during the Financial Year under review and has incurred loss of Rs.(39.41) Lakhs as against loss of Rs. (50.94) Lakhs in previous financial year 2021-22.
The real estate sector has become more efficient to operate in India due to implementation of Real Estate (Regulation and Development) Act, 2016, hence more opportunities in Real Estate Business for orderly growth are slated to arise in future. The Company is currently under negotiations for a land parcel for future project if the same can be undertaken and the same will be informed to the Members in due course. Your Directors are optimistic about Company's better performance with increased revenue in next year.
4. CHANGE IN NATURE OF BUSINESS:
During the year under review, there was no change in the nature of the business of the Company.
5. DIVIDEND:
Due to losses, the Directors of the Company have not recommended any dividend for the current financial year.
6. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND:
The provisions of Section 125(2) of the Companies Act, 2013 are not applicable as the Company has not declared and paid any dividend in previous years.
7. TRANSFER TO RESERVES:
For the FY 2022-23, the Company has transferred Rs. (39.41) Lakhs as loss, therefore as at 31st March 2023, the accumulated loss stands at Rs. (2,178.68) Lakhs.
8. SHARE CAPITAL:
The Share capital of your Company is Rs. 25,06,56,300/- divided into 2,50,65,630 Equity Shares of Rs. 10/- each with Voting Rights as at 31.03.2023.
a. Provision of money by company for purchase of its own shares by employees or by trustees for the benefit of employees:
The Company has not made any provision of money for purchase of its own shares by employees or by trustees for the benefit of employees as per Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014.
b. Issue of Sweat Equity Shares:
The Company has not issued any sweat equity shares during the financial year in accordance with the provisions of Section 54 of Companies Act, 2013 read with Rule 8 of the Companies (Share Capital and Debentures) Rules, 2014.
c. Issue of Equity Shares with Differential Voting Rights:
The Company has not issued any equity shares with differential voting rights during the financial year as per Rule 4(4) of Companies (Share Capital and Debentures) Rules, 2014.
d. Issue of Employee Stock Option:
The Company has not issued any employee stock option during the financial year as per Rule 12 of Companies (Share Capital and Debentures) Rules, 2014.
I I
9. PUBLIC DEPOSITS:
There were no outstanding deposits within the meaning of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014 at the end of the financial year. Your Company has not accepted any such deposits during the financial year 2022-23.
10. DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Your Board consists of Five Directors including Three Independent (Non- Executive Directors). The declaration from all the Independent Directors are being obtained both at the time of appointment and at the First Board meeting of each Financial Year.
In accordance with the provisions of the Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Mrs. K. Vijaya Rani is liable to retire by rotation at the 25thAnnual General Meeting and being eligible has offered herself for re-appointment. Her re-appointment is being placed for your approval at the Annual General Meeting. Your Directors recommend her re-appointment as the Non-Executive Director of your Company.
Board Meetings:
During the year under review, the Board of Directors met Six (6) times and the dates of the Board Meetings are:
The details of the Meetings of Board are covered in the Corporate Governance Report.
A. Key Managerial Personnel (KMP's):
In compliance with the requirements of Section 203 of the Companies Act, 2013, following are the Key Managerial Personnel of the Company:
1. Mr. Guduru Satyanarayana
- Managing Director
2. Mr. Manne Rama Koteswara Rao
- Chief Financial Officer
3. CS. Vinda M
- Company Secretary and Compliance Officer
B. Declaration by Independent Directors:
In accordance with Sub-section (7) of Section 149 of the Companies Act, 2013 (hereinafter called as "The Act"), the Independent Directors on your Board have given a Declaration that they meet the criteria of Independence as provided in sub section (6) of Section 149 of the Act. There has been no change in terms and conditions of appointment of Independent Directors, the Policy relating to their appointment is available on the website of the Company www.quantumbuild.com.
During the year under review, a separate meeting of Independent Directors of the Company without the presence of non-independent directors and members of the management and all the independent directors were present in the meeting held on 14th February, 2023 in Compliance with the Regulation 25 of SEBI (LODR) Regulations 2015 in which the following matters were considered:
i. Review of the performance of all the non-independent directors and the Board as a whole.
ii. Review of the performance of the Chairman of the Company, taking into accounts the views of Executive Directors and Non-Executive Directors; and
iii. Assessment of quality, quantity, and timeliness of flow of information among the Company, management, and the Board, which is necessary for the Board to perform their duties effectively and reasonably.
C. Board Evaluation:
The Board of Directors has carried out an Annual Evaluation of its own performance and has devised a Policy on Evaluation of performance of Board of Directors, Committees and Individual Directors, pursuant to the provisions of the Act, the Corporate Governance requirements and as prescribed by Regulation 25 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The Extract of the Policy on Evaluation of Performance of the Board, its Committees and individual Directors, is available on the website of the Company www.quantumbuild.com.
11. ANNUAL RETURN:
The extracts of the Draft Annual Return pursuant to the provisions of Section 92(3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 in Draft of Annual Return will be available on the website of the Company www.quantumbuild.com. and the web link for the same is www.quantumbuild.com / investors.php
12. DIRECTORS' RESPONSIBILITY STATEMENT:
In accordance with the provisions of Section 134(5) of the Act, your directors, to the best of their knowledge and ability, confirm that:
a) In the preparation of the annual accounts for the Financial Year ended 31stMarch, 2023, the applicable accounting standards had been followed along with proper explanation relating 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 of the Company as at 31st March, 2023 and of the 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 the 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 devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively;
f) 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.
13. DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS:
The Company has Internal Financial Controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company's policies, the safeguarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information. The details in respect of Internal Financial Controls are included in the Management Discussion and Analysis Report, which forms part of the Annual Report.
14. AUDIT OF ACCOUNTS AND STATUTORY AUDITORS:
As per the provisions of Section 139 of the Companies Act, 2013 M/s. Suryanarayana & Suresh, Chartered Accountants, (Firm Registration No. 006631S), were re-appointed as Statutory Auditors of the Company by the members / shareholders in the Annual General Meeting held on 28thSeptember 2022, for five consecutive years for issuing the Audit report on the Financial position of the Company.
M/s. Suryanarayana & Suresh, Chartered Accountants (Firm Registration No 006631S), Statutory Auditors of the Company issued Auditors Report for the financial year ended 31st March, 2023 which is with unmodified opinion (unqualified). The observations made by the Statutory Auditors in their report for the financial year ended 31st March, 2023 read with the explanatory notes therein are selfexplanatory and therefore, do not call for any further explanation or comments from the Board under Section 134(3)(f) of the Companies Act, 2013.
The auditors' report does not contain any qualifications, reservations, or adverse remarks.
15. SECRETARIAL AUDIT:
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed CS. Ajay Suman Shrivastava, Practicing Company Secretary, Hyderabad, to conduct the Secretarial Audit of the Company for the financial year 2022-23.The Report contains details of delays in compliance of SEBI (LODR) 2015, and penalties imposed by BSE Ltd during the year. The same are factual details and do not require any comments from the Directors.
The Secretarial Audit Report issued by the Secretarial Auditor for the financial year 2022-23 in Form MR-3 as Annexure-I forms a part of this Report.
16. DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNAL:
No orders have been passed by any Regulator or Court or Tribunal which can have impact on the going concern status and the Company's operations in future.
17. STATUS OF LITIGATIONS :
The Members are informed that Mrs. Kodali Vijayarani, Promoter Director has filed a Petition under Section 241 with National Company Law Tribunal at Hyderabad ( NCLT) against 7 shareholders vide Petition No. 240/241/HDB/2020 dt 24.06.2020, matter taken up for hearing on 07.09.2020 and after further hearings. NCLT has given an Interim Order on the said Petition on 14.10.2020 directing restrained from sale , pledge or mortgage of 1,24,50,000 shares held by 7 shareholders, and from then onwards matter is being adjourned and the final hearing was held on 15.06.2022 where the Bench dismissed the petition.
Company has filed a Petition under Section 213 vide Petition No. 354/213/2020 before the NCLT against Necx Pvt Ltd and its Shareholders and the matter taken up for hearing on 27thOctober, 2020 and from then onwards matter is being adjourned for and on various dates and pleadings were completed and was dismissed in the hearing held on 15.06.2022.
Company has received a Petition notice from the advocate through mail on 30th March, 2021 along with annexures filed by Y. Srinivasa Rao & 5 Others, against Quantum Build Tech Ltd & 5 Directors before the NCLT under Section 241, vide Petition No. 28/2021 . This petition was dismissed in the hearing held on 15.06.2022.
The Members are informed that Mrs.Kodali Vijaya Rani, Promoter Director has filed a petition under Section 421 of Companies Act, 2013 with National Company Law Appellate Tribunal at Chennai (NCLAT) against 7 Shareholders vide Petition No. 59 of 2022 arising out of the order dt 15.06.2022 in CP No. 240/241/HDB/2020. Matter listed on 16.06.2023 and directed the contesting parties (who are all on records) to file their "Notes for Submissions" and directed the Registry to list the Matter for Hearing on 23.08.2023. Next hearing on 20.09.2023.
18. PARTICULARS OF EMPLOYEES:
There are no employees drawing remuneration as prescribed under Section 197 of the Companies Act, 2013. Hence the details are NIL.
19. THE SEXUAL HARASSMENT OF WOMAN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:
The Company has placed an Anti-Sexual Harassment policy in line with the requirement of the Sexual harassment of Woman at Workplace (Prevention, prohibition and redressal) Act, 2013. There have been NIL complaints of such nature during the period under review.
20. RISK MANAGEMENT:
The Company has well-defined risk management framework in place. The risk management works at various levels of the Company. The Company has robust organizational structure for managing and reporting on risks.
Your Company has developed and implemented a Risk Management Policy which is approved by the Board. The Audit Committee has additional oversight in financial risks and controls.
In the opinion of the Board, following are risks involved in the industry:
a. High Interest rate.
b. Fluctuation in prices of building materials.
c. Competitive Risk due to entry of many players in local market.
d. Operational Risk of market saturation.
e. Stringent regulatory framework.
f. Slow Disbursement of approvals.
21. ESTABLISHMENT OF VIGIL MECHANISM:
The Vigil Mechanism as envisaged in the Companies Act, 2013, the Rules prescribed thereunder and the Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is implemented through the Company's Whistle Blower Policy to enable the Directors, employees and all stakeholders of the Company to report genuine concerns, to provide for adequate safeguards against victimization of persons who use such mechanism and make provision for direct access to the Chairman of the Audit Committee.
Whistle Blower Policy of your Company is available on the website of the Company www.quantumbuild.com
22. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
The Company in its ordinary course of business has entered Contract /Arrangement and paid rent of premises amounting to Rs 1.14 Lakhs to the Director during the financial year 2022-23. The transaction is on Arm's Length basis. In pursuant to Sec. 188(1) of the Companies Act, 2013, Form AOC-2 is annexed herewith as Annexure - III.
23. PARTICULARS OF LOANS, GUARANTEES, INVESTMENT AND SECURITIES.
The Company has not given any loan to any person or other body corporate or given any guarantee or provided security in connection with a loan to any other body corporate or person or acquired by way of subscription, purchase or otherwise, the securities of any other body corporate during the financial year under review.
24. CORPORATE SOCIAL RESPONSIBILITY (CSR):
During the financial year under review, the Company's performance does not attract the provisions set out under Section 135 of the Companies Act, 2013 read with rules made thereunder. Hence, the compliances to the provisions of Section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility Policy) Rules, 2014, are not applicable..
25. CORPORATE GOVERNANCE:
Corporate Governance encompasses a set of systems and practices to ensure that the Company's affairs are being managed in a manner which ensures accountability, transparency and fairness in all transactions in the widest sense. The objective is to meet stakeholders' aspirations and societal expectations. Good governance practices stem from the dynamic culture and positive mindset of the Company.
The Company has adopted a Code of Conduct for its employees including the Managing Director and the Executive Directors. The said Code of Conduct is available on Company's Website, www.quantumbuild.com
A report on Corporate Governance covering amongst other details of Meetings of the Board and Committees along with a Certificate for compliance with the Corporate Governance requirements of Regulations 17 to 27 read with Schedule V and clauses (b) to (i) of Regulation 46(2) of SEBI (LODR) Regulations, 2015, as applicable, with regard to Corporate Governance, issued by a Practicing Company Secretary, forms part of the Annual Report.
26. NOMINATION AND REMUNERATION COMMITTEE:
The Company has constituted Nomination and Remuneration Committee of Directors in accordance with the requirements of Section 178 of the Companies Act, 2013 read with Regulation 19 of SEBI (LODR) Regulations, 2015. The details are given in the Corporate Governance report attached hereto.
27. SUBSIDIARY, HOLDING, ASSOCIATE COMPANIES AND JOINT VENTURES:
The Company does not have any Subsidiary, Holding, Joint Venture or Associate Company as on date.
28. MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT:
No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which these financial statements relate, till the date of this report.
29. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:
The information pertaining to conservation of energy, technology absorption, foreign exchange earnings and outgo as required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 are as follows:
CONSERVATION OF ENERGY :
TECHNOLOGY ABSORPTION:
FOREIGN EXCHANGE EARNINGS AND OUTGO :
Particulars of foreign currency earnings and outgo during the financial year are NIL.
30. LISTING:
The shares of your Company are listed at Bombay Stock Exchange (BSE Ltd). The Company has duly complied with all the requirements of concerned Stock Exchange in accordance with applicable provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended from time to time. There have been some instances of delay in compliance as reported elsewhere in the Annual Report.
31. ACKNOWLEDGEMENTS:
Your Directors wish to place on record their appreciation and sincere thanks to all government agencies, banks, shareholders, vendors and other related organizations, who through their continued support and co-operation, have helped, as partners, in your Company's progress. Your Directors also acknowledge the hard work, dedication and commitment of the employees.