the general manager 10th august, 2019 dept. of corporate ......the general manager 10th august, 2019...
TRANSCRIPT
The General Manager 10th August 2019 Dept of Corporate Services
BSE Limited
1st floor New Trading Ring
Rotunda Building PJ Towers
Dalal Street Fort
Mumbai 400 001
Dear Sirs
Report and Accounts for the financial year ended 31st March 2019
We enclose a copy of the Report and Accounts of the Company for the financial year
ended 31st March 2019 containing the Notice dated 15th July 2019 convening the 37th
Annual General Meeting of the Company on 7th September 2019 at Vadodara in terms
of Regulations 30 and 34 of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations 2015
Yours faithfully For Gujarat Hotels Limited Mayur Agarwal Compliance Officer Encl aa
REPORT AND ACCOUNTS 2019
1
Board of Directors amp Committees 2
Notice of Annual General Meeting 3
Your Directors 9
Report on Corporate Governance 11
Shareholder Information 17
Report of the Board of Directors amp Management 20Discussion and Analysis
CEO and CFO Compliance Certificate 39
Balance Sheet 40
Statement of Profit and Loss 41
Statement of changes in equity 42
Cash Flow Statement 43
Notes to the Financial Statements 44
Independent Auditors Report 58
Board of DirectorsCONTENTS
2
BOARD OF DIRECTORS amp COMMITTEES
Board Committees
Chairman and Non-Executive Director
Nakul Anand
Non-Executive Directors
Mohan Swarup Bhatnagar
Devkanya Roy Choudhury
Cheruvettolil Kochukoshy Koshy
Mahalinga Narayanan
Jagdish Singh
M Narayanan Chairman C K Koshy Chairman J Singh Chairman
C K Koshy Member N Anand Member D R Choudhury Member
J Singh Member M Narayanan Member C K Koshy Member
M Agarwal Invitee J Singh Member
K Pahwa Invitee
Representative of InviteeStatutory Auditors
Audit Committee Nominations andRemuneration Committee
StakeholdersRelationship Committee
Key Managerial Personnel
Board of Directors
Registered Office Statutory Auditors Registrar and Share Transfer AgentsWelcomHotel Vadodara K C Mehta amp Co MCS Share Transfer Agent LimitedR C Dutt Road Alkapuri Chartered Accountants F-651st FloorVadodara - 390 007 Vadodara Okhla Industrial Area Phase - 1Tel 0265-233 0033 New Delhi 110 020CIN L55100GJ1982PLC005408 Tel 011-4140 6149-52 4160 9386Website wwwgujarathotelsltdinE-mail ghlinvestorsyahoocoin
Chief Executive Officer - Kunal Pahwa Chief Financial Officer - Mayur Agarwal
3
NOTICE IS HEREBY GIVEN that the Thirty Seventh AnnualGeneral Meeting of the Members of Gujarat Hotels Limitedwill be held at the Registered Office of the Company atWelcomHotel Vadodara R C Dutt Road Alkapuri Vadodarandash 390 007 on Saturday the 7th day of September 2019 at1100 am for the transaction of the following businesses-
ORDINARY BUSINESS
1 To consider and adopt the Financial Statements of theCompany for the financial year ended 31st March2019 and the Reports of the Board of Directors andthe Auditors
2 To declare dividend for the financial year ended31st March 2019
3 To appoint a Director in place of Mr Jagdish Singh(DIN 00042258) who retires by rotation and beingeligible offers himself for re-election
4 To consider and if thought fit to pass the followingresolution as an Ordinary Resolution-
ldquoResolved that in accordance with the provisions ofSection 142 of the Companies Act 2013 payment ofremuneration of ` 60000- (Rupees Sixty Thousandonly) to Messrs K C Mehta amp Co CharteredAccountants (FRN 106237W) to conduct the audit forthe financial year 2019-20 plus goods and servicestax as applicable and reimbursement of out-of-pocketexpenses incurred be and is hereby approvedrdquo
SPECIAL BUSINESS
5 To consider and if thought fit to pass the followingresolution as an Ordinary Resolution-
ldquoResolved that in accordance with the provisions ofSection 149 read with Schedule IV of the CompaniesAct 2013 and Regulation 17 of the Securities andExchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 thisMeeting hereby approves the appointment ofMr Mohan Swarup Bhatnagar (DIN 00834857) as anIndependent Director of the Company for a period offive years with effect from 28th June 2019 or till suchearlier date as may be determined by any applicablestatutes rules regulations or guidelinesrdquo
6 To consider and if thought fit to pass the followingresolution as a Special Resolution-
ldquoResolved that in accordance with the provisions ofSection 149 read with Schedule IV of the Companies
GUJARAT HOTELS LIMITEDCIN L55100GJ1982PLC005408
Registered Office WelcomHotel Vadodara R C Dutt Road Alkapuri Vadodara-390 007Tel +91 0265 233 0033 E-mail ghlinvestorsyahoocoin Website wwwgujarathotelsltdin
NOTICE OF 37TH ANNUAL GENERAL MEETING
AGM NOTICE
Act 2013 and Regulation 17 of the Securities andExchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 thisMeeting hereby approves the re-appointment ofMr Cheruvettolil Kochukoshy Koshy (DIN 01478704)as an Independent Director of the Company for aperiod of five years with effect from 29th September2019 or till such earlier date as may be determinedby any applicable statutes rules regulations orguidelinesrdquo
7 To consider and if thought fit to pass the followingresolution as a Special Resolution-
ldquoResolved that in accordance with the provisions ofSection 149 read with Schedule IV of the CompaniesAct 2013 and Regulation 17 of the Securities andExchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 thisMeeting hereby approves the re-appointment ofMr Mahalinga Narayanan (DIN 00159288) as anIndependent Director of the Company for a period offive years with effect from 29th September 2019 or tillsuch earlier date as may be determined by anyapplicable statutes rules regulations or guidelinesrdquo
The Register of Members of the Company will remainclosed from Friday 30th August 2019 to Saturday7th September 2019 both days inclusive ShareTransfers received in order at the Companyrsquos Registrarand Share Transfer Agents Messrs MCS ShareTransfer Agent Limited F-65 1st Floor Okhla IndustrialArea Phase - I New Delhi - 110 020 by 530 pm onThursday 29th August 2019 will be processed forpayment of dividend if declared to the transferees orto their mandatees and the dividend if declared willbe paid on Friday 13th September 2019 to thoseMembers entitled thereto and whose names willappear in the Register of Members of the Companyon 7th September 2019 or to their mandatees subjecthowever to the provisions of Section 126 of theCompanies Act 2013 In respect of dematerialisedshares the dividend will be paid on the basis ofbeneficial ownership as on 29th August 2019 as perdetails to be furnished by National SecuritiesDepository Limited (NSDL) and Central DepositoryServices (India) Limited (CDSL) for this purpose
By Order of the BoardGujarat Hotels Limited
Place New Delhi Jagdish SinghDate 15th July 2019 Director
4
NOTES
1 A Member entitled to attend and vote at the AnnualGeneral Meeting (lsquoAGMrsquo) may appoint a proxy toattend and vote on his behalf A proxy need not be aMember of the Company
Proxies in order to be effective must be received atthe Registered Office of the Company not less thanforty-eight hours before the commencement of the AGMie by 1100 am on 5th September 2019
Corporate Members are required to send to theRegistered Office of the Company a certified copy ofthe Board Resolution pursuant to Section 113 of theCompanies Act 2013 (lsquothe Actrsquo) authorising theirrepresentatives to attend and vote at the AGM
2 Explanatory Statement pursuant to Section 102 of theAct relating to the Special Business to be transactedat this AGM is annexed
3 Route map of the AGM venue pursuant to theSecretarial Standard on General Meetings is alsoannexed
4 In terms of Section 108 of the Act read with Rule 20 ofthe Companies (Management and Administration)Rules 2014 the Resolutions for consideration at thisAGM will be transacted through remote e-voting (facilityto cast vote from a place other than the venue of theAGM) for which purpose the Board of Directors of theCompany (lsquothe Boardrsquo) have engaged the services ofCDSL
The facility for voting through ballot paper will beavailable at the AGM venue for those Members who donot cast their votes by remote e-voting prior to the AGMMembers who cast their votes by remote e-voting mayattend the Meeting but will not be entitled to cast theirvotes once again The Board has appointedMr Suresh Kabra (ACS 9711) Partner Messrs SamdaniKabra amp Associates Company Secretaries as theScrutinizer to scrutinize the process of remote e-votingand voting through ballot paper at the AGM venue
5 Voting rights will be reckoned on the paid-up value ofshares registered in the name of the Members on31st August 2019 (cut-off date) Only those Memberswhose names are recorded in the Register ofMembers of the Company or in the Register ofBeneficial Owners maintained by the Depositories ason the cut-off date will be entitled to cast their votes byremote e-voting or voting through ballot paper at theAGM venue A person who is not a Member on thecut-off date should accordingly treat this Notice as forinformation purposes only
6 Unclaimed dividend for the financial year ended31st March 2012 and the corresponding Equity Sharesof the Company in respect of which dividend
entitlements remain unclaimed for seven consecutiveyears will be due for transfer to the Investor Educationand Protection Fund of the Central Government on14th September 2019 pursuant to the provisions ofSection 124 of the Act read with the Investor Educationand Protection Fund Authority (Accounting AuditTransfer and Refund) Rules 2016 Members arerequested to claim the said dividend details of whichare available on the Companyrsquos websitewwwgujarathotelsltdin under the section lsquoGeneralInformationrsquo under lsquoShareholder Valuersquo The Companywill not be able to entertain any claim received after12th September 2019 in respect of the same
7 Members may visit the Companyrsquos website to viewthe Financial Statements or access informationpertaining to the Company Queries if any should besent at least 10 days before the AGM to theChief Financial Officer at the Registered Office of theCompany
8 Members are required to bring their admission slipsto the AGM Duplicate admission slips or copies of theReport and Accounts will not be made available at theAGM venue
9 The procedure with respect to remote e-voting isprovided below
I The period for remote e-voting begins onTuesday 3rd September 2019 at 900 am andends on Friday 6th September 2019 at 500 pmDuring this period Members of the Companyholding shares either in certificate form or indematerialised form as on the cut-off date ie31st August 2019 may cast their voteselectronically The e-voting module shall bedisabled by CDSL for voting thereafter
II The Members should log on to the e-votingwebsite wwwevotingindiacom
III Click on lsquoShareholders MembersrsquoIV Now enter your user ID as under
bull For CDSL 16 digits beneficiary ID
bull For NSDL 8 character DP ID followed by 8digits Client ID
bull Members holding shares in certificate formshould enter Folio Number registered withthe Company
V Thereafter enter the image verification code asdisplayed and Click on lsquoLoginrsquo
VI If you are holding shares in dematerialised formand had logged on to wwwevotingindiacom andcasted your vote earlier for any company thenyour existing password is to be used If you have
5
forgotten the password then enter user ID andthe image verification code and click on forgotpassword amp enter the details as prompted by thesystem
VII If you are a first time user please follow the stepsgiven below
For Members holding shares either in dematerialisedform or in certificate form
PAN Enter your 10 digit alpha-numeric PAN issuedby Income Tax Departmentbull Members who have not updated their
PAN with the Company DepositoryParticipant are requested to use the firsttwo letters of their name and the 8 digitsof the sequence number in the PAN field
bull In case the sequence number is lessthan 8 digits enter the applicable numberof 0rsquos before the number after the firsttwo characters of the name in CAPITALletters Eg If your name is RameshKumar with sequence number I thenenter RA00000001 in the PAN field
Dividend Enter the Dividend Bank Details or Date ofBank Birth (in ddmmyyyy format) as recorded inDetails your demat account or in the CompanyOR records in order to loginDate of bull If both the details are not recorded withBirth the Depository or the Company please
enter your member ID folio number inthe Dividend Bank details field asmentioned in instruction IV
VIII After entering these details appropriately click onlsquoSubmitrsquo
IX Members holding shares in certificate form willthen reach directly to the Companyrsquos selectionscreen
X Members holding shares in dematerialised formwill then reach the lsquoPassword Creationrsquo menuwherein they are required to mandatorily entertheir login password in the new password fieldKindly note that this password can be used forvoting on resolutions of any other company onwhich you are eligible to vote provided that thesaid company opts for e-voting through CDSLplatform It is strongly recommended not to shareyour password with any other person and takeutmost care to keep your password confidential
XI For Members holding shares in certificate formthe details can be used only for e-voting on theResolutions contained in this Notice
XII Click on the EVSN for Gujarat Hotels Limited
XIII On the voting page you will see lsquoResolutionDescriptionrsquo and against the same the optionlsquoYes Norsquo for voting Select the option lsquoYesrsquo or lsquoNorsquoas desired The option lsquoYesrsquo implies that youassent to the Resolution and the option lsquoNorsquoimplies that you dissent to the Resolution
XIV Click on the lsquoResolutions File Linkrsquo if you wish toview the entire Resolution details
XV After selecting the Resolution you have decidedto vote on click on lsquoSubmitrsquo A confirmation boxwill be displayed If you wish to confirm your voteclick on lsquoOkrsquo else to change your vote click onlsquoCancelrsquo and accordingly modify your vote
XVI Once you lsquoConfirmrsquo your vote on the Resolutionyou will not be allowed to modify your vote
XVII You can also take a print of the votes cast byclicking on lsquoClick here to printrsquo option on theVoting page
XVIII Members can also cast their vote using CDSLrsquosmobile app lsquom-Votingrsquo available on Android Appleand Windows based mobiles Members may login to m-Voting using their e-voting credentials tovote on the Company Resolutions
XIX Note for NonndashIndividual Members and Custodians
bull Non-Individuals Members (ie other than HUFIndividuals NRI etc) and Custodians are requiredto log on to wwwevotingindiacom and registerthemselves as Corporates
bull A scanned copy of the Registration Form bearingthe stamp and sign of the entity should be emailedto helpdeskevotingcdslindiacom
bull After receiving the login details user would be ableto link the account(s) for which they wish to voteon
bull The list of accounts linked in the login should bemailed to helpdeskevotingcdslindiacom and onapproval of the accounts they would be able tocast their vote
bull A scanned copy of the Board Resolution and Powerof Attorney (POA) which they have issued in favourof the Custodian if any should be uploaded in PDFformat in the system for the Scrutinizer to verify thesame
XX In case you have any queries or issues regardinge-voting you may refer to the Frequently AskedQuestions and e-voting manual available underthe help section of CDSLrsquos e-voting websitewwwevotingindiacom or write an email tohelpdeskevotingcdslindiacom or contact
6
Mr Rakesh Dalvi at telephone no 18002005533(toll free) You may also address your queries grievances relating to remote e-voting or votingat the meeting to Mr M Agarwal ComplianceOfficer at e-mail ID ghlinvestorsyahoocoin orat telephone no 0265 233 0033
XXI Those who become Members of the Companyafter despatch of the Notice but on or before31st August 2019 (cut-off date) may follow thesteps from Sl Nos II to XIX mentioned above forcasting of vote
XXII General Information
(a) There will be one vote for every Client ID NoRegistered Folio No irrespective of thenumber of joint holders
(b) The Results of voting will be declaredwithin 48 hours from the conclusion of theAGM and the Resolutions will be deemedto be passed on the date of the AGMsubject to receipt of requisite number ofvotes The declared Results along with theScrutinizerrsquos Report will be availableforthwith on the Companyrsquos websitewwwgujarathotelsltdin under the sectionlsquoInvestor Relationsrsquo and on the website ofCDSL such Results will also be forwardedto BSE Limited where the Companyrsquosshares are listed
EXPLANATORY STATEMENT
Annexed to the Notice convening the Thirty Seventh AnnualGeneral Meeting to be held on Saturday 7th September2019
Item No 5
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 28th June 2019 on the recommendationof the Nominations and Remuneration Committee(lsquothe Committeersquo) approved the appointment of Mr MohanSwarup Bhatnagar as Additional Director with effect from28th June 2019 and subject to the approval of the Membersalso as Independent Director of the Company for a periodof five years with effect from the said date in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquotheActrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquothe Listing Regulations2015rsquo)
Mr Bhatnagar (67) is a Science Graduate from St StephenrsquosCollege University of Delhi and is an MBA from the Facultyof Management Studies University of Delhi
Mr Bhatnagar joined ITC Limited (ITC) in 1975 in the HotelsDivision He held various job positions in Finance beforetaking over as the Head of Finance in 1997 withresponsibility for Treasury Audit Purchasing MaterialManagement and Information Technology Subsequentlyhe held charge of Growth and Development for the HotelsBusiness as Executive Vice President He was a memberof the Management Committee of the Division and was onthe Boards of Joint Venture and Subsidiary companies ofITC He retired from ITC in September 2013 Currently heis actively involved in angel investing and in mentoringselect start-up ventures
The Committee and the Board are of the view that theassociation of Mr Bhatnagar and the rich experience hebrings with him would benefit the Company Declarationhas been received from Mr Bhatnagar that he meets thecriteria of Independence prescribed under Section 149 ofthe Act read with the Companies (Appointment andQualification of Directors) Rules 2014 and Regulation 16of the Listing Regulations 2015 In the opinion of your BoardMr Bhatnagar fulfils the conditions specified in the Act theRules thereunder and the Listing Regulations 2015 forappointment as an Independent Director and he isindependent of the management of the CompanyMr Bhatnagar will be entitled to sitting fees for attending themeetings of the Board and its Committees
Requisite Notice under Section 160 of the Act proposingthe appointment of Mr Bhatnagar has been received by theCompany and consent has been filled by Mr Bhatnagarpursuant to Section 152 of the Act
Mr Bhatnagar holds 2500 shares in the Company
Mr Bhatnagar and his relatives are interested in thisResolution None of the other Directors and Key ManagerialPersonnel of the Company or their relatives is interestedin this Resolution
The Board recommends this Resolution for your approval
Item Nos 6 amp 7
The Members of the Company at the Thirty Second AnnualGeneral Meeting held on 29th September 2014 approvedthe appointment of Mr Koshy and Mr M Narayanan asIndependent Directors of the Company for a period of fiveyears with effect from the said date Mr Koshy andMr Narayanan will complete their respective terms on28th September 2019
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 15th April 2019 on the recommendationof the Nominations and Remuneration Committee (lsquotheCommitteersquo) recommended for the approval of theMembers the re-appointment of Mr Koshy andMr Narayanan as Independent Directors of the Companywith effect from 29th September 2019 in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquothe
7
Actrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquoListing Regulations2015rsquo) as set out in the Resolutions relating to theirrespective re-appointment
The Committee and the Board are of the view that giventhe knowledge experience and performance of Mr Koshyand Mr Narayanan and contribution to the Board processesby them their continued association would benefit theCompany Declarations have been received from Mr Koshyand Mr Narayanan that they meet the criteria ofIndependence prescribed under Section 149 of the Act readwith the Companies (Appointment and Qualification ofDirectors) Rules 2014 and Regulation 16 of the ListingRegulations 2015 In the opinion of the Board Mr Koshyand Mr Narayanan fulfil the conditions specified in the Actthe Rules thereunder and the Listing Regulations 2015 forre-appointment as Independent Directors and they areindependent of the management of the Company Mr Koshyand Mr Narayanan will be entitled to sitting fees for attendingmeetings of the Board and its Committees
Consent of the Members by way of Special Resolution isrequired for re-appointment of Mr Koshy and Mr Narayananin terms of Section 149 of the Act Further pursuant toRegulation 17 of the Listing Regulations 2015 consent ofthe Members by way of Special Resolution is also requiredfor continuation of a Non-Executive Director beyond the ageof seventy five years During the proposed term ofre-appointment Mr Koshy and Mr Narayanan will attain theage of seventy five years on 12th February 2020 and1st July 2020 respectively The Special Resolutions under
Item No 6 and 7 once passed shall also be deemed asyour approval under the Listing Regulations 2015 forcontinuation of Mr Koshy and Mr Narayanan as IndependentDirectors beyond the age of seventy five years
Requisite Notices under Section 160 of the Act proposingthe re-appointment of Mr Koshy and Mr Narayanan havebeen received by the Company and consents have beenfiled by Mr Koshy and Mr Narayanan pursuant to Section152 of the Act
Additional information in respect of Mr Koshy andMr Narayanan pursuant to the Listing Regulations 2015and the Secretarial Standard on General Meetings isappearing in the Report and Accounts under the sectionslsquoYour Directorsrsquo and lsquoReport on Corporate GovernancersquoMr Koshy and Mr Narayanan do not hold any share in theCompany either in their individual capacity or on a beneficialbasis for any other person
Mr Koshy and Mr Narayanan and their relatives areinterested in the Special Resolutions relating to theirrespective re-appointment None of the other Directors andKey Managerial Personnel of the Company or theirrelatives is interested in these Special Resolutions
The Board recommends these Special Resolutions for yourapproval
By Order of the BoardGujarat Hotels Limited
Place New Delhi Jagdish SinghDate 15th July 2019 Director
8
ROUTE MAP
AGM VenueWelcomHotel VadodaraR C Dutt Road AlkapuriVadodara 390 007
9
N Anand
Nakul Anand (62) DIN 00022279 a Non-Executive Directorof the Company since 10th March 1998 was appointed asthe Chairman of the Company effective 21st March 2009He is an Executive Director on the Board of ITC Limited andholds responsibility for the Hospitality Travel amp Tourismand Lifestyle Retailing businesses of ITC
An Economics Honours Graduate from the Delhi Universitywith an AMP degree from the Bond University AustraliaAnand joined ITC Hotelsrsquo Management TrainingProgramme in 1978 He has also served as the ManagingDirector of erstwhile ITC Hotels Limited during the period2003-05
In a career that spans close to four decades Anand hasbeen acknowledged in the hotels and tourism industry forhis vision and commitment Leveraging the significantlearning of sustainable excellence within ITC he led theteam at ITC Hotels to pioneer the concept of lsquoResponsibleLuxuryrsquo in the hospitality industry securing LEEDreg Platinumcertifications for all ITC premium luxury hotels He hasformulated value-based strategies to create a uniquequality control model His dynamic leadership and passionfor the business is recognised and acknowledged by hispeers He has been a past President of the HotelAssociation of India and past Chairman of the CII NationalTourism Committee Anand is presently a member of theNational Tourism Advisory Council constituted by theMinistry of Tourism Government of India Chairman of theFederation of Associations in Indian Tourism amp Hospitalityand a Member of the Executive Committee of the HotelAssociation of India He is also a Member of the IndiandashSriLanka CEOs Forum Council Member amp ExecutiveCommittee Member of the National Culture Fund Ministryof Culture Government of India and a Member on the Boardof the International Tourism Partnership
Other Directorships
Name of the company Position
International Travel House Limited Chairman amp Non-Executive Director
Landbase India Limited Chairman amp Non-Executive Director
Fortune Park Hotels Limited Chairman amp Non-Executive Director
WelcomHotels Lanka (Private) Limited Chairman amp Non-Executive Director
Srinivasa Resorts Limited Vice Chairman amp Non-Executive Director
ITC Limited Executive Director
Bay Islands Hotels Limited Non-Executive Director
Maharaja Heritage Resorts Limited Non-Executive Director
Committee Membership of other companies
Name of the Committee Positioncompany
International Travel House Limited Nominations amp MemberRemuneration Committee
Landbase India Limited Audit Committee Member
Fortune Park Hotels Limited Corporate Social ChairmanResponsibility Committee
CK Koshy
Cheruvettolil Kochukoshy Koshy (74) DIN01478704 wasappointed as an Independent Non-Executive Director ofthe Company on 1st May 2007 He is Master of Arts inPolitical Science and Public Administration He joined theIndian Administrative Service in 1968 from the Gujarat Cadreand superannuated in February 2005
In a long career spanning over 38 years he has held severaleminent positions including those of Additional ChiefSecretary - Department of Revenue Industries and MinesTourism and Civil Aviation and Finance and PrincipalSecretary to the Chief Minister He served the Governmentof India as Joint Secretary amp Financial Advisor to theDepartment of Atomic Energy and as Executive Director ofNuclear Power Corporation of India Limited He has heldthe posts of Managing Director of the Tourism Corporationof Gujarat Sardar Sarovar Narmada Nigam Gujarat StateSmall Industries Corporation and Girinar Scooter LimitedHe was also the Joint Managing Director of the GujaratIndustrial Investment Corporation and Chairman of GujaratState Petroleum Corporation Limited Gujarat State PetronetLimited and Gujarat Energy Research and ManagementInstitute
Post retirement he has been a consultant to the Departmentfor International Development - UK the World Bank and tothe Department of Personnel and Administrative ReformsGovt of India He was appointed Professor Emeritus in thefaculty of Planning and Public Policy at CEPT UniversityAhmedabad and is an Advisor to both Indian School ofPetroleum and Energy New Delhi and University ofPetroleum and Energy Studies Dehradun Currently he isAdvisor at CEPT University and on the Board of Trustees ofAlliance Francaise Gujarat and GIAN an NGO whichencourages innovation at the grass root level
Koshy does not hold directorship of any other company
M Narayanan
Mahalinga Narayanan (74) DIN 00159288 was appointedas an Independent Non-Executive Director of the Companyon 10th January 2008 He is a post graduate in CommerceGraduate in Law Diploma Holder in Business Managementand holds certified Associated Membership of the Indian
YOUR DIRECTORS
10
Institute of Bankers He has rich experience of over fourdecades in Banking Project Finance Administration andrelated areas
Narayanan started his career with the Reserve Bank ofIndia in 1964 and moved over to the Bank of Baroda in1969 and continued till March 1985 During his tenure inBank of Baroda he worked in all departments of commercialbanking operation and was in-charge of large branches ofthe Bank In April 1985 he joined Industrial FinanceCorporation of India and held senior managementpositions In October 1997 he joined Tourism FinanceCorporation of India Limited as Managing Director and roseto the position of Chairman and Managing Director whichposition he held till his retirement in September 2006 Hewas conferred with ldquoUdyog Rattan Awardrdquo in the year 2005by the Institute of Economic Studies New Delhi
Other Directorships
Name of the company Position
Cox amp Kings Limited Independent DirectorTulip Star Hotels Limited Independent DirectorRoyale Indian Rail Tours Limited Independent DirectorPride Hotels Limited Chairman amp Independent Director
Committee Membership of other Companies
Name of the company Committee Position
Cox amp Kings Limited Audit Committee ChairmanRemuneration MemberCommittee
Pride Hotels Limited Audit Committee ChairmanRoyale Indian Rail Tours Limited Audit Committee Chairman
Tulip Star Hotels Limited Audit Committee Chairman
J Singh
Jagdish Singh (53) DIN 00042258 was appointed as aNon-Executive Director on the Board of the Company on16th April 2016 A Commerce Graduate and a CharteredAccountant Singh joined ITC Limited in the year 1990During these 26 years he has held various positions inthe finance function He started his career in Treasury andmoved as Corporate Accountant Commercial Manager atCigarette factory at Munger and Head of Finance at ITCEssentra Limited He was then the Head of Treasury
between 2005 and 2015 and is presently the Head ofFinance at ITCrsquos Hotels Division
Other DirectorshipsName of the company Position
International Travel House Limited Non-Executive DirectorFortune Park Hotels Limited Non-Executive DirectorBay Islands Hotels Limited Non-Executive DirectorSrinivasa Resorts Limited Non-Executive DirectorMaharaja Heritage Resorts Limited Non-Executive DirectorMimec (India) Limited Non-Executive DirectorLandbase India Limited Additional Non-Executive DirectorLogix Developers Private Limited Non-Executive Director
Committee Membership of other companiesName of the Committee Positioncompany
International Travel House Limited Stakeholders Relationship MemberCommitteeAudit Committee MemberNominations amp Remuneration MemberCommittee
Fortune Park Hotels Limited Corporate Social MemberResponsibility Committee
Srinivasa Resorts Limited Audit Committee ChairmanCorporate Social MemberResponsibility Committee
D R Choudhury
Devkanya Roy Choudhury (41) DIN 07066556 wasappointed as a Non-Executive Director of the Company on19th January 2015 A Graduate from the National LawSchool of India University Bengaluru she joined ITC Limitedin 2001 As part of Corporate Legal of ITC she has rich andvaried experience in handling legal matters pertaining tovarious divisions including Tobacco Hotels Personal CareLifestyle Retailing Education amp Stationery Paperboards ampSpecialty Papers ITC Infotech as also dealing with mergersamp acquisitions and key litigation across ITC CurrentlyMs Choudhury is the Senior Associate General Counsel ofITC Limited
Other Directorships
Name of the Company Position
WelcomHotels Lanka (Private) Limited Non-Executive Director
YOUR DIRECTORS
Denotes foreign company Denotes listed Indian company whose equity shares or preference shares or debt securities are listed on a recognised
stock exchangeNotes1 Other Directorships and Committee Memberships of Directors are as on 15th April 20192 Committee Memberships cover Committees under the Companies Act 2013 viz Audit Committee Stakeholders
Relationship Committee Nomination and Remuneration Committee and CSR Committee of Indian Companies
11
REPORT ON CORPORATE GOVERNANCE
The Directors present the Companyrsquos Report on CorporateGovernance pursuant to the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements)Regulations 2015 (lsquoListing Regulations 2015rsquo)
THE COMPANYrsquoS GOVERNANCE PHILOSOPHY
The Company firmly believes in good CorporateGovernance and has made it a practice and a continuousprocess of development right across the Company TheCompanyrsquos philosophy on Corporate Governanceenvisages attainment of high level of transparency andaccountability in the functioning of the Company andconduct of business and places due emphasis onregulatory compliance It has empowered the ExecutiveManagement to take decisions with regard to day-to-dayoperations and has also created checks and balances thatsuch decisions are taken with care and responsibility tomeet stakeholdersrsquo aspirations and societal expectations
The Companyrsquos corporate philosophy is focused on itspeople who are its most important asset and it values itsemployeesrsquo integrity creativity ability judgement andopinions who in turn demonstrate the highest ethicalstandards and responsibility towards the shareholdersThis has helped the Company take rapid strides in itspursuit of excellence
The Company is committed to enhance shareholder valuein a fair and transparent manner and has been in theforefront for benchmarking itself with the best businesspractices globally
BOARD OF DIRECTORS
All statutory and other significant and material informationare placed before the Board of Directors (the Board) toenable it to discharge its responsibility of strategicsupervision of the Company as trustees of theshareholders
Composition
The Board comprises entirely of Non-Executive Directorsincluding one Woman Director and two IndependentDirectors The strength of the Board as on 15th April 2019is five
The Board Diversity Policy of the Company requires theBoard to have balance of skills experience and diversity ofperspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the Annexure forming part ofthis Report These skills expertise and competencies areavailable in the present mix of the Directors of the Company
Composition of the Board as on 31st March 2019
Category No of PercentageDirectors to total no
of Directors
Non-Executive Independent Directors 3 50Other Non-Executive Directors 3 50Total 6 100
During the year there was no change in the directorshipMr R C Mehta resigned as Non-Executive IndependentDirector of the Company with close of work on 31st March2019 keeping in view the Regulation 17(1A) of ListingRegulations 2015
Mr Mehta has confirmed that there are no other reasons forhis resignation other than stated above
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Board were held The intervening periodbetween two Board meetings was well within the maximumgap of 120 days prescribed under the Listing Regulations2015
Board Agenda
Meetings are governed by a structured agenda The Boardmembers in consultation with the Chairman may bring upany matter for the consideration of the Board All majoragenda items are backed by comprehensive backgroundinformation to enable the Board to take informed decisionsAgenda papers are generally circulated seven days prior tothe Board meeting
Information placed before the Board
The following matters are tabled for the Boardrsquos periodicreview information
bull Annual operating plans amp budgets and periodic reviewof the Companyrsquos businesses
bull Quarterly performance
bull External Audit Management Reports (through the AuditCommittee)
bull Status of legal compliance
bull Status and effectiveness of risk management plans
bull Succession to senior management (through theNominations and Remuneration Committee)
bull Statutory compliance reports
bull Show cause demand prosecution adjudicationnotices if any from revenue authorities which areconsidered materially important including anyexposure that exceeds 1 of the Companyrsquos net worthand their outcome
12
bull W rite-offs disposals (fixed assets receivablesadvances etc) on a half-yearly basis
bull Significant development in Human Resources Industrial Relations
bull Material non-compliance of any regulatory or listingrequirements and in relation to shareholdersrsquoservices
bull All other matters required to be placed before theBoard for its review information under the ListingRegulations 2015 and other statutes
Post-meeting follow-up systemThe Governance processes in the Company include aneffective post-meeting follow-up review and reportingprocess for action taken pending on decisions of the Boardand the Board Committees
Details of Board Meeting during the financial year
During the financial year ended 31st March 2019 fourmeetings of the Board were held as follows
SI Date Board No ofNo Strength Directors
present
1 17th April 2018 6 6
2 7th August 2018 6 6
3 1st November 2018 6 5
4 30th January 2019 6 5
COMMITTEES OF THE BOARD
Currently there are three Committees of the Board ndash theAudit Committee the Stakeholders RelationshipCommittee and the Nominations and RemunerationCommittee The terms of reference of the BoardCommittees are determined by the Board from time to timeMeetings of Board Committees are convened by therespective Committee Chairman All the recommendationsmade by Board Committees during the year were acceptedby the Board Minutes of Board Committee meetings areplaced before the Board for its information The role andcomposition of these Committees including the numberof meetings held during the financial year and the relatedattendance are provided below
A AUDIT COMMITTEEThe Audit Committee of the Board provides reassurance tothe Board on the existence of an effective internal controlenvironment that ensuresbull efficiency and effectiveness of operations
bull safeguarding of assets and adequacy of provisionsfor all liabilities
bull reliability of financial and other managementinformation and adequacy of disclosures
bull compliance with all relevant statutesThe role of the Committee includes the followingbull To oversee the Companyrsquos financial reporting process
and the disclosure of its financial information to
REPORT ON CORPORATE GOVERNANCE
Directorsrsquo attendance at the Board Meetings during the financial year and at the last Annual General Meeting (AGM) as alsotheir other Directorships and Committee Memberships are given below
SI Director Category No of Attendance No of No of Membership(s) No Board at last other Chairmanship(s) of Audit
Meetings AGM Directorship(s) Committee Stakeholdersattended Relationship Committee of
other Indian public limitedcompanies
1 N Anand Chairman amp 4 Yes 8 1Non-Executive Director
2 C K Koshy Non-Executive 4 Yes Nil NilIndependent Director
3 R C Mehta1 Non-Executive 2 Yes 4 NilIndependent Director
4 M Narayanan Non-Executive 4 Yes 4 4 (all as Chairman)Independent Director
5 D R Choudhary Non-Executive Director 4 Yes 1 Nil6 J Singh Non-Executive Director 4 Yes 8 3 (including 1 as Chairman)
1 Resigned as Non-Executive Independent Director wef 1st April 2019 Details with respect to other Directorships of the Directors are provided under the section lsquoYour Directorsrsquo in the Report and Accounts
13
ensure that the financial statements are correctsufficient and credible
bull To recommend the appointment remuneration termsof appointment and removal of Statutory Auditors
bull To approve transactions of the Company with relatedparties
bull To evaluate the Companyrsquos internal financial controlsand risk management systems
bull To review with the management the following
- Annual financial statements and Auditorrsquos Reportthereon before submission to the Board forapproval
- Quarterly financial statements before submissionto the Board for approval
bull To review the following
- Management discussion and analysis of financialcondition amp results of operations and mattersrequired to be included in the DirectorsrsquoResponsibility Statement
- Adequacy of internal control systems and theCompanyrsquos statement on the same prior toendorsement by the Board such review to bedone in consultation with the managementStatutory and Internal Auditors
- Adequacy of internal control systems forcompliance with the provisions of the Securitiesand Exchange Board of India (Prohibition ofInsider Trading) Regulations 2015
- Reports of Internal Audit and discussion withInternal Auditors on any significant findings andfollow-up thereon
- Statutory Auditorsrsquo independence andperformance and effectiveness of the auditprocess
- System for storage retrieval security etc of booksof account maintained in the electronic form
- Functioning of Whistleblower mechanism in theCompany
Composition
The Audit Committee as on 15th April 2019 comprisesthree Non-Executive Directors two of whom are IndependentDirectors The Chairman of the Committee is anIndependent Director The Chief Executive Officer the ChiefFinancial Officer and the representative of Statutory Auditorsare Invitees to meetings of the Audit Committee and theCompany Secretary is the Secretary to the Committee Allmembers of the Committee are financially literate twomembers including the Chairman of the Committee haveaccounting and financial management expertise
The names of the members of the Audit Committeeincluding its Chairman are provided under the sectionlsquoBoard of Directors amp Committeesrsquo in the Report andAccounts
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Audit Committee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 4 4
2 7th August 2018 4 4
3 1st November 2018 4 3
4 30th January 2019 4 3
Attendance at Audit Committee Meetings during thefinancial year
Member No of meetingsattended
M Narayanan1 4
C K Koshy 4
R C Mehta2 2
J Singh 41 Appointed Chairman wef 15th April 20192 Ceased to be Member and Chairman wef 1st April 2019
B STAKEHOLDERS RELATIONSHIP COMMITTEE
The Stakeholders Relationship Committee of the Boardoversees redressal of shareholder and investor grievancesand inter alia approves transmission of sharessub-division consolidation renewal of share certificatesissue of duplicate share certificates etc
Composition
The Stakeholders Relationship Committee presentlycomprises three Non-Executive Directors including oneIndependent Director The Chairman of the Committee is aNon-Executive Director The Company Secretary is theSecretary to the Committee
The names of the members of the StakeholdersRelationship Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 sevenmeetings of the Stakeholders Relationship Committeewere held as follows
REPORT ON CORPORATE GOVERNANCE
14
SI Date Committee No ofNo Strength Members
present1 17th April 2018 2 2
2 29th June 2018 2 2
3 7th August 2018 2 2
4 27th September 2018 2 2
5 1st November 2018 2 2
6 4th January 2019 2 2
7 30th January 2019 2 2
Attendance at Stakeholders Relationship CommitteeMeetings during the financial year
Member No of meetingsattended
J Singh 7
D R Choudhury 7
C K Koshy 0
Appointed Member wef 31st March 2019
C NOMINATIONS AND REMUNERATION COMMITTEEThe Nominations and Remuneration Committee of theBoard inter alia identifies persons qualified to becomeDirectors and formulates criteria for evaluation ofperformance of the Directors and the Board as a wholeThe Committeersquos role includes recommending to theBoard the appointment remuneration and removal ofDirectors and Key Managerial Personnel
Composition
The Nominations and Remuneration Committee as on15th April 2019 comprises four Non-Executive Directorstwo of whom are Independent Directors The Chairman ofthe Committee is an Independent Director The CompanySecretary is the Secretary to the Committee
The names of the members of the Nominations andRemuneration Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 twomeetings of the Nominations and RemunerationCommittee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 5 5
2 30th January 2019 5 4
Attendance at Nominations and Remuneration CommitteeMeetings during the financial year
Member No of meetingsattended
C K Koshy 2
N Anand 2
R C Mehta1 1
M Narayanan 2
J Singh 21 Ceased to be Member wef 1st April 2019
Remuneration Policy
The Companyrsquos Remuneration Policy aims at attractingand retaining high calibre talent The Remuneration Policytherefore is market-led and takes into account thecompetitive circumstance of each business so as to attractand retain quality talent and leverage performancesignificantly
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpwwwgujarathotels ltd in polic ies Remuneration-Policy_GHLpdf There has been no change in the Policyduring the year
Remuneration of Directors
Non-Executive Directors are entitled to sitting fees forattending the meetings of the Board and its Committeesthe quantum of which is determined by the Board Thesitting fees to Non-Executive Directors as determined bythe Board are ` 20000- and ` 10000- for each meeting ofthe Board and its Committees respectively
Details of sitting fees paid to the Directors during thefinancial year ended 31st March 2019
Director Sitting Fees (`)
C K Koshy 150000-
R C Mehta1 70000-
M Narayanan 150000-1 Resigned as Non-Executive Independent Director wef1st April 2019
Note Disclosure with respect to Non-Executive Directors ndashPecuniary relationship or transaction None
Performance Evaluation
Performance evaluation of the Board the BoardCommittees and the individual Directors was carried outby the Board in accordance with the Policy approved by theNominations and Remuneration Committee in this regardbrief details of the same are provided in the lsquoReport of theBoard of Directors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
REPORT ON CORPORATE GOVERNANCE
15
Directorsrsquo Shareholding
Details of Shareholding of the Directors in the Company ason 31st March 2019 are given below
Director No of Equity Shares of ` 10-each held singly jointly
N Anand 200
D R Choudhury Nil
C K Koshy Nil
R C Mehta Nil
M Narayanan Nil
J Singh Nil
OTHER DISCLOSURESbull Details of non-compliances penalties and strictures
by Stock Exchanges SEBI Statutory Authorities onany matter related to capital markets during the lastthree years
Nonebull Inter-se relationships between Directors and Key
Managerial Personnel of the Company
Nonebull Materially significant related party transactions which
may have potential conflict with the interests of theCompany at large
Nonebull Material financial and commercial transactions of
senior management where they may have hadpersonal interest and which had potential conflict withthe interests of the Company at large
Nonebull Details of utilisation of funds raised through
preferential allotment or qualified institutionsplacement
Not Applicablebull Credit rating(s) obtained by the Company for any debt
instrument fixed deposit programme or any otherscheme involving mobilisation of funds
Nonebull None of the Directors of the Company has been
debarred or disqualified from being appointed orcontinuing as a Director by SEBI Ministry of CorporateAffairs Statutory Authorities which has also beenconfirmed by Messrs PB amp Associates PractisingCompany Secretaries
bull Confirmation by the Board with respect to theIndependent Directors is provided in the lsquoReport ofthe Board of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Disclosures in relation to the Sexual Harassment ofWomen at Workplace (Prevention Prohibition andRedressal) Act 2013 are provided in the lsquoReport of theBoard of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Information with respect to lsquoCommodity Price Risk orForeign Exchange Risk and Hedging Activitiesrsquo
Nonebull The total fees paid by the Company to Messrs K C
Mehta amp Co Statutory Auditors and all other entitiesforming part of the same network aggregate` 100000-
bull Compliance Officer under the Listing Regulations2015
Deepak Kumar Gulati Company Secretary
MEANS OF COMMUNICATION
Timely disclosure of consistent comparable relevant andreliable information on corporate financial performance isat the core of good governance Towards this end thequarterly results of the Company were announced withinforty five days from the end of the quarter Audited annualresults along with the results for the fourth quarter wereannounced within sixty days from the end of the financialyear Extract of these results were published in lsquoTheFinancial Expressrsquo (all editions) and in its Gujarati editionas vernacular newspaper Further quarterly resultsshareholding pattern and other material events amp importantinformation relating to the Company were submitted to BSELimited through BSE Listing Centre for dissemination onits website The Company publishes its quarterlyhalf-yearly and annual financial results and also posts suchresults on its website wwwgujarathotelsltdin
The Report of the Board of Directors forming part of theReport and Accounts includes all aspects of lsquoManagementDiscussion and Analysisrsquo as required under the ListingRegulations 2015
GHL CODE OF CONDUCT FOR PREVENTION OF INSIDERTRADING ndash 2019
The GHL Code of Conduct for Prevention of Insider Tradingapproved by the Board inter alia prohibits trading insecurities of the Company by Directors and employeeswhile in possession of unpublished price sensitiveinformation in relation to the Company
GHL CODE OF CONDUCT
The GHL Code of Conduct is applicable to Directors seniormanagement and employees of the Company The Codeis derived from three interlinked fundamental principlesviz good corporate governance good corporate citizenshipand exemplary personal conduct in relation to theCompanyrsquos business and reputation The Code coversGHLrsquos commitment to sustainable development concern
REPORT ON CORPORATE GOVERNANCE
16
for occupational health safety and environment a genderfriendly workplace transparency and auditability legalcompliance and the philosophy of leading by personalexample The Code is available on the Companyrsquos website
Declaration as required under the Listing Regulations 2015All Directors and senior management of the Companyhave affirmed compliance with the GHL Code of Conductfor the financial year ended 31st March 2019New Delhi K Pahwa15th April 2019 CEO
WHISTLEBLOWER POLICYSynopsis of the Whistleblower Policy of the Company isprovided in the lsquoReport of the Board of Directors ampManagement Discussion and Analysisrsquo forming part of theReport and Accounts The Whistleblower Policy is alsoavailable on the Companyrsquos websiteFAMILIARISATION PROGRAMME FOR DIRECTORSGHL believes that a Board which is well informed familiarised with the Company and its affairs can contributesignificantly to effectively discharge its role of trusteeshipin a manner that fulfils stakeholdersrsquo aspirations andsocietal expectations In pursuit of this the Directors of theCompany are updated on changes developments in thedomestic global corporate and industry scenario includingthose pertaining to statutes legislations and economicenvironment and on matters affecting the Company toenable them to take well informed and timely decisionsFurther details may be accessed on the Companyrsquos websiteat httpwwwgujarathotelsltdinpoliciesDirectorrsquos-Familiarisation-programmespdfPOLICY ON RELATED PARTY TRANSACTIONSThe Policy as approved by the Board may be accessed onthe Companyrsquos website at
h t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_TranscationspdfDISCRETIONARY REQUIREMENTS UNDER THE LISTINGREGULATIONS 2015The status of compliance with the discretionaryrequirements under the Listing Regulations 2015 isprovided below1 Chairmanrsquos Office The Company has a Non-Executive
Chairman but he does not maintain any separate officeand hence no expense in this regard is being incurredby the Company
2 Shareholder Rights The quarterly half-yearly andannual financial results of the Company are postedon the Companyrsquos website and extract of these resultsare published in newspapers on an all India basisThe complete Report and Accounts is sent to everyShareholder of the Company
3 Audit Opinion It has always been the Companyrsquosendevour to present financial statements with
unmodified audit opinion The Statutory Auditors haveissued an unmodified audit opinion on the Companyrsquosfinancial statements for the year ended 31st March2019
4 Separate posts of Chairman and Chief ExecutiveOfficer The Company has a Non-Executive Chairmanand a Chief Executive Officer
5 Internal Audit The Internal Auditor of the CompanyMessrs Shah amp Talati Chartered Accountants reportsto the Audit Committee of the Board
GENERAL SHAREHOLDER INFORMATIONProvided in the lsquoShareholder Informationrsquo section of theReport and Accounts
CONFIRMATION OF COMPLIANCEbull It is confirmed that the Company has complied with
the requirements prescribed under Regulations 17 to27 and clauses (b) to (i) of sub - regulation (2) ofRegulation 46 of the Listing Regulations 2015
bull The Statutory Auditorsrsquo Certificate that the Companyhas complied with the conditions of CorporateGovernance is annexed to the lsquoReport of the Board ofDirectors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
ANNEXURE TO THE REPORT ON CORPORATEGOVERNANCESKILLS EXPERTISE AND COMPETENCIES OF DIRECTORSThe Company believes that Board members should havea balance of skills experience and diversity of perspectivesappropriate to the Company Accordingly the Directorsshould possess one or more of the following skillsexpertise and competencies
1 Leadership
Leadership experience in a commensurate-sizedorganisation with understanding of organisationalsystems and processes strategic areas andemerging business trends
2 Industry Knowledge and Experience
Domain knowledge of Hotel business and itsdynamics long-term strategies and regulatory ampcompetitive environment
3 Finance and Accounting
Ability to understand financial policies accountingstatements and disclosure practices to contribute tothe financial risk management policies and practicesof the Company
4 Governance
Commitment belief and experience in settinggovernance practices to support the Companys legalcompliance systems and governance polic ies practices
REPORT ON CORPORATE GOVERNANCE
17
SHAREHOLDER INFORMATION
AGM Details
Date Saturday 7th September 2019Venue WelcomHotel Vadodara R C Dutt Road
Alkapuri Vadodara 390 007Time 1100 amBook Friday 30th August 2019 toClosure Saturday 7th September 2019Dates (both days inclusive)Dividend Friday 13th September 2019PaymentDate
Registrar and Share Transfer Agents
Messrs MCS Share Transfer Agent Limited are the Registrarand Share Transfer Agents (RTA) of the Company forcarrying out share registration and other related activitiesof the Company
Address for Correspondence
MCS Share Transfer Agent LimitedF-65 1st Floor Okhla Industrial AreaPhase ndash I New Delhi - 110 020Telephone Nos 011 4140 6149-52 4160 9386Facsimile No 011 4170 9881E-mail helpdeskdelhimcsregistrarscom
Shareholders holding shares in the dematerialised formshould address their correspondence except those relatedto dividend to their respective Depository Participants
Share Transfer Committee
The Share Transfer Committee of the Company generallymeets once in ten days for approving share transfers Theprocessing activities with respect to requests received forshare transfers are completed within fifteen days from thedate of receipt of request The Committee met 11 timesduring the financial year ended 31st March 2019 to approveshare transfers There were no share transfers pendingas on 31st March 2019
The Share Transfer Committee presently comprises thefollowing
D R Choudhury - Director MemberJ Singh - Director MemberM Agarwal - Compliance Officer Member
Dematerialisation of Shares and Liquidity
The shares of the Company are available for trading in thedematerialised form under both the Depository Systems inIndia - NSDL and CDSL The International SecuritiesIdentification Number (lSIN) allotted to the Companysshares under the Depository System is INE621C01011
As on 31st March 2019 a total of 3525013 Equity Sharesof the Company which translates to 9307 of the ShareCapital stood dematerialised The processing activitieswith respect to requests received for dematerialisation arecompleted between fifteen to thirty daysShareholder Investor ComplaintsThe Company attends to Shareholder Investor complaintsqueries and other correspondence generally within fifteendays except where constrained by disputes or legalimpedimentsThe Company did not receive any complaint during thefinancial year ended 31st March 2019The e-mail ID earmarked by the Company for this purposeghlinvestorsyahoocoinDistribution of Shareholding as on 31st March 2019
No of No of EquityNo of Shareholders Shares
SharesSlab Total to Total to
Share Shareholders Capital
1 - 500 5152 9455 587438 1551501 - 1000 138 253 112061 296
1001 - 2000 68 125 100167 2652001 - 3000 26 048 62030 1643001 - 4000 16 029 58804 1554001 - 5000 11 020 50785 1345001 - 10000 23 042 163405 431
10001 - 50000 8 015 147787 39050001 - 100000 3 006 226954 599
100001 amp Above 4 007 2278084 6015Total 5449 10000 3787515 10000
Categories of Shareholders as on 31st March 2019Sl Category No of toNo Shares Share
held hold ingA Promoter Holding1 Promoter and Promoter Group
ITC Limited 1733907 4578Russell Investments Limited 300056 792Sub-Total 2033963 5370
B Non Promoter Holding2 Institutional Investorsa Mutual Funds NIL NILb Banks 100 000c Foreign Institutional Investors and NIL NIL
Foreign Portfolio InvestorsSub-Total 100 000
3 Othersa Private Corporate Bodies 193726 511b Indian Public 1335461 3527c NRIs 102362 270d Others 121903 322
Sub Total 1753452 4630Grand Total 3787515 10000
18
Monthly High and Low Quotes and Volume of Sharestraded on BSE Limited
Year Month High L o w Volume(` ) (` ) (Nos)
2018 April 13800 12000 93584May 13100 11710 26778June 12735 11500 18090July 12195 11400 27113August 12295 11450 14900September 12000 10900 23492October 11400 10505 18787November 12975 10700 15386December 11490 10700 40291
2019 January 11320 10700 22160February 11185 10005 12395March 11295 10400 21625
Performance in comparison to broad based indices suchas SampP BSE Sensex
Note - Indicates monthly closing positions
Listing of Shares on Stock Exchange (with Stock Code)BSE Limited (507960)Phiroze Jeejeebhoy Towers Dalal Street Mumbai 400 001Telephone Nos 022-2272 1233 34Facsimile No 022-2272 1919E-mail isbseindiacomWebsite wwwbseindiacom
The Listing Fee for the financial year 2019-20 has beenpaid to BSE Limited
Financial CalendarFinancial Year 2019-20(1st April - 31st March)
1 First Quarter Results July 20192 Second Quarter and October November 2019
Half-Year Results3 Third Quarter Results January February 20204 Fourth Quarter and May 2020
Annual Results
Particulars of past three AGMsAGM Financial Venue Date Time Special
Year ResolutionPassed
36th 2017-18 WelcomHotel 07-08-2018 NoneVadodara
35th 2016-17 R C Dutt Road 08-08-2017 1100 NoneAlkapuri am
34th 2015-16 Vadodara 20-09-2016 None390 007
Postal Ballot
No special resolution requiring postal ballot was eitherproposed last year or is being proposed for the ensuing AGM
SHAREHOLDER REFERENCER
Transfer of Shares in certificate form
Effective 1st April 2019 transfer of shares of a listedcompany can only be effected in dematerialised form interms of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 Shareholders holdingshares in the certificate form are therefore requested todematerialise their shares in their own interestCommunication in this respect has been sent by theCompany during the year to the concerned ShareholdersHowever transfer deeds which were lodged with theCompany on or before 31st March 2019 but were returneddue to any deficiency will be processed upon re-lodgement
Transfer of Dividend and corresponding Equity Shares tothe Investor Education and Protection Fund (IEPF)
During the financial year 2018-19 unclaimed dividend forthe financial year 2010-11 aggregating ` 636444- andthe corresponding 13150 Equity Shares in respect of whichdividend entitlements remained unclaimed for sevenconsecutive years or more have been transferred by theCompany to the IEPF established by the CentralGovernment pursuant to the provisions of Section 124 ofthe Companies Act 2013 read with the Investor Educationand Protection Fund Authority (Accounting Audit Transferand Refund) Rules 2016
Shareholders may claim their unclaimed dividend for theyears prior to and including the financial year 2010-11 andthe corresponding shares from the IEPF Authority byapplying in the prescribed Form No IEPF-5 This Form canbe downloaded from the website of the IEPF Authoritywwwiepfgovin the access link of which is also availableon the Companys website wwwgujarathotelsltdin underthe section General Information under Shareholder Value
The unclaimed dividend for the undernoted years and thecorresponding shares will be transferred by the Companyto the IEPF in accordance with the schedule given belowAttention in particular is drawn that the unclaimed dividendfor the financial year 2011-12 and the corresponding shareswill be due for transfer to the IEPF on 14th September
SHAREHOLDER INFORMATION
19
Central Depository Services (India) LimitedMarathon Futurex A Wing 25th FloorMafatlal Mill Compound N M Joshi MargLower Parel Mumbai 400 013Telephone No 022-2302 3333Facsimile No 022-2300 2035E-mail helpdeskcdslindiacomWebsite wwwcdslindiacomRemittance of Dividend through Electronic ModeThe Company provides the facility for remittance of dividendto Shareholders through RTGS (Real Time GrossSettlement) NACH (National Automated Clearing House) NEFT (National Electronic Funds Transfer)
Shareholders who have not opted for remittance of dividendthrough electronic mode and wish to avail the same arerequired to provide their bank details including IFSC (IndianFinancial System Code) and MICR (Magnetic Ink CharacterRecognition) to their respective Depository Participants(DPs) or to the RTA where shares are held in thedematerialised form and in the certificate form respectively
Shareholders holding shares in the certificate form mayuse the Mandate Form for this purpose which can bedownloaded from the Companys websitewwwgujarathotelsltdin under the section GeneralInformation under Shareholder Value
Address and Bank DetailsShareholders holding shares in the certificate form arerequested to advise the RTA of any change in their address mandate bank details to facilitate better servicingShareholders are advised that as a measure of protectionagainst fraudulent encashment their bank details oraddress as available with the RTA will be printed on thedividend warrants or demand drafts where dividend cannotbe remitted through electronic mode
Permanent Account Number (PAN)Shareholders holding shares in the certificate form arerequested to send copies of their PAN Cards to the RTA tofacilitate better servicing
Furnishing of PAN Card however is mandatory as followsi) Transferees and Transferors PAN Cards for transfer
of sharesii) Legal heirs Nominees PAN Cards for transmission
of sharesiii) Surviving joint holders PAN Cards for deletion of name
of deceased Shareholders andiv) Joint holders PAN Cards for transposition of shares
Nomination Facility
Shareholders who hold shares in the certificate form andwish to make any nomination change nomination madeearlier in respect of their shareholding in the Companyshould submit to the RTA the prescribed Form such Formcan be downloaded from the Companys website underthe section Investor Relations under Shareholder Value
SHAREHOLDER INFORMATION
2019 for which purpose communication has been sent tothe concerned Shareholders advising them to write to theCompany to claim their dividend Notices in this regardhave also been published in newspapers Details of suchunclaimed dividend and corresponding shares areavailable on the Companys website under the sectionGeneral Information under Shareholder Value
Financial Date of declaration Due date for transferYear of Dividend to IEPF2011-12 8th August 2012 14th September 2019
2012-13 13th August 2013 19th September 2020
2013-14 29th September 2014 5th November 2021
2014-15 29th September2015 5th November 2022
2015-16 20th September 2016 26th October 2023
2016-17 8th August 2017 14th September 2024
2017-18 7th August 2018 12th September 2025
The Company will not be able to entertain any claim receivedafter 12th September 2019
Shareholders who have not so far encashed their dividendwarrant(s) or have not received the same are requested toapply for duplicate warrant(s) by writing to the Companyand confirming non-encashment non-receipt of dividendwarrant(s)
Service of Documents
The Company sends Notices Report and Accounts andother communications in electronic mode to thoseShareholders who have registered their e-mail addresseswith the Company or with the Depositories and in physicalmode to the other Shareholders
Shareholders who wish to register or update their e-mailaddresses with the Company may use the Form forregistration updation which can be downloaded from theCompanys website under the section Investor Relationsunder Shareholder Value
Depository Services
Shareholders may write to the respective Depository or tothe RTA for guidance on depository services
The contact details of the Depositories are given below
National Securities Depository LimitedTrade World A Wing 4th FloorKamala Mills CompoundSenapati Bapat Marg Lower ParelMumbai 400 013Telephone No 022-2499 4200Facsimile No 022-2497 6351E-mail infonsdlcoinWebsite wwwnsdlcoin
20
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
FOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019Your Directors submit their Report for the financial yearended 31st March 2019
BUSINESS ENVIRONMENT
The global economic growth softened to 36 in 2018representing a marked slowdown compared to the 39growth anticipated at the beginning of the year buoyed bya strong fiscal expansion in the USA which was offset largelyby slower growth in some other large economies ieEurope Japan etc Going forward global growth in 2019 isprojected to decline further to 33 in the base case withrisks to the downside emanating from politicaluncertainties rising trade tensions escalatingprotectionism and tighter financial conditions
As per Ministry of Statistics amp Programme Implementation(MSPI) Indian economy registered the GDP growth of 7in 2018-19 as compared to 72 in 2017-18 The economyis expected to grow and maintain a level of 75 in 2019and 2020 as per the World Bank estimates
India is the most digitally-advanced traveller nation in termsof digital tools being used for planning booking andexperiencing a journey During 2018 foreign tourist arrivals(FTAs) in India stood at 1056 million achieving a growthrate of 52 year-on-year The Government of India is alsoworking to achieve 1 share in worldrsquos international touristarrivals by 2020 and 2 share by 2025
The operating environment in the hospitality sector showedimprovement with foreign tourist arrivals Indiarsquos risingmiddle class and increasing disposable incomes havecontinued to support the growth of domestic tourism
With the inauguration of Statue of Sardar Vallabhbhai Patelalso known as lsquoStatute of Unityrsquo which is the higheststanding statue in the world at a height of 182 meters thetourism in the city of Vadodara is expected to grow
FINANCIAL PERFORMANCE
During the year under review your Company earned licensefees of ` 36987 lakhs (previous year ` 33098 lakhs)Theother income at ` 19626 lakhs showed an increase mainlydue to improvement in return on current investment Preand post-tax profits increased to ` 51822 lakhs (previousyear ` 45313 lakhs) and ` 40788 lakhs (previous year` 33690 lakhs) respectively
Your Directors are pleased to recommend a dividend of` 350 per Equity Share of ` 10- each for the year ended31st March 2019 thereby maintaining last yearrsquos dividendand involving a cash outflow of ` 160 lakhs includingDividend Distribution Tax of ` 27 Lakhs
PROFITS DIVIDEND AND RETAINED EARNINGS
The financial results of your Company summarised areas under
For the year ended For the year ended31st March 2019 31st March 2018
Profits (` ) (` )
a Profit Before Tax 51822363 45312928
b Tax Expense
Current Tax 11653499 9272310Deferred Tax (618755) 2350502
c Profit for the year 40787619 33690116
d Other Comprehensive Income - -
e Total Comprehensive Income 40787619 33690116
Statement of Retained Earningsa At the beginning of the year 213211090 195873461
b Add Total Comprehensive Income 40787619 33690116
c Less Dividend paid including IncomeTax on Dividend paid 15981176 15954974
d Less Income Tax on Dividend paid forearlier year - 397513
e At the end of the year 238017533 213211090
Your Directors are pleased to recommend a dividend of` 350 per Equity Share (Previous Year ` 350) of ` 10-each for the year ended 31st March 2019
Details of changes in Key Financial Ratio amp Return onNet Worth
The key financial ratio of the Company where there hasbeen significant change (25 or more) and change inReturn on Net Worth are summarized below pursuant toSchedule V (B) to the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements)Regulations 2015 (Listing Regulations 2015)
HOTEL OPERATIONS
Your Hotel WelcomHotel Vadodara licensed to ITC Limitedrecorded an income of ` 249443 lakhs during the year ascompared to ` 221856 lakhs in the previous year Therewas an improvement in both occupancy and average roomrates leading to an overall improvement in HotelPerformance
Financial Ratio
2018-19 2017-18 Change
Reason for change
Current Ratio
278 223 25 Increase in value of current investment based on accumulation of market return and fresh investment done during the year out of surplus funds
Return on Net Worth
133 120 11 Due to higher rate of growth in profit after tax
21
The Food amp Beverage segment of your Companyrsquos Hotelcontinues to be a major strength The Peshawri Restaurantand the Welcom Cafeacute Cambay both retained their premiumleadership positions
Your Company has filed a writ petition in the Gujarat HighCourt seeking that the Gujarat State Government be directedto take action on your Companyrsquos application to have theleasehold land of the Hotel converted to freehold andtransferred to your Company as per the existing governmentpolicy in this regard The Honourable High Court passedan Order on 24th December 2014 restraining the StateGovernment from disturbing the peaceful and actualpossession of the Company over the hotel property in anymanner including construction thereon The writ petition ispending
Your Company is also making all efforts for expeditiousconversion of land from leasehold to freehold or in thealternative extension of Lease For further details pleaserefer to Note no 20A of the Accounts
SUBSIDIARIES ASSOCIATES AND JOINT VENTURES
The Company does not have any subsidiary associate orjoint venture
INTERNAL FINANCIAL CONTROLS
Your Company is managed by the Board of Directors andthe Executive Management with clearly defined rolesresponsibilities and authorities The Executive Managementis responsible for the day-to-day conduct of the affairs ofthe Company within the overall framework approved by theBoard Your Company also has a Code of Conduct whichrequires management to conform to the required financialand accounting policies systems and processes conductbusiness ethically and ensure strict compliance with allapplicable laws and regulations Ongoing ReviewProcesses and the Risk Management Framework create acontrol environment in the Company and provide thecornerstones for Internal Financial Controls with referenceto your Companyrsquos Financial Statements
Your Companyrsquos Financial Statements are prepared on thebasis of the Significant Accounting Policies that are carefullyselected by the management and approved by the AuditCommittee and the Board These Policies are reviewedand updated from time to time and audited by the InternalAuditor whose findings and recommendations are reviewedby the Audit Committee and tracked through toimplementation
Your Company maintains its Books of Account in electronicform Your Company has in place adequate internalfinancial controls with reference to the FinancialStatements
The Internal Auditors of the Company evaluates theadequacy and efficacy of such internal financial controlsSuch controls have been assessed during the year by the
management Based on the results of this assessmentno reportable material weakness or significant deficienciesin the design or operation of internal financial controls wereobserved Nonetheless your Company recognises that anyinternal financial control framework no matter how welldesigned has inherent limitations and accordingly regularaudit and review processes ensure that such systems arereinforced on an ongoing basis
RISK MANAGEMENT
Your Company continues its emphasis on a systems-basedapproach to business risk managementBacked by stronginternal control systems the current Risk Managementframework consists of the following key elements
- The Board of Directors (lsquoThe Boardrsquo) has clearly laiddown the roles and responsibilities of the Company inrelation to risk management covering a range ofresponsibilities from strategic to operational Theserole definitions provide the foundation for yourCompanyrsquos Risk Management Policy that is endorsedby the Board and is aimed at ensuring formulation ofappropriate risk management procedures theireffective implementation and independent monitoringand reporting by Internal Audit
- Management of risks vest with the ExecutiveManagement which is responsible for the day-to-dayconduct of the affairs of the Company within the overallframework approved by the Board
- A combination of policies and procedures which areregularly reviewed and updated in the light of changingbusiness and regulatory environment bringsrobustness to the process of ensuring that businessrisks are effectively addressed
- Appropriate structures are in place to proactivelymonitor and manage the inherent risks in businesswith unique relatively high risk profiles
- An Independent Internal Audit Firm carries out riskfocused audits enabling identification of areas whererisk management processes may need to bestrengthened
- The Audit Committee of the Board reviews the InternalAudit findings and provides strategic guidance oninternal controls The Chief Executive Officer closelymonitors the internal control environment within yourCompany including implementation of the action plansemerging out of internal audit findings
The combination of policies and processes as outlinedabove adequately address the various risks associatedwith your Companyrsquos business
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
22
AUDIT AND SYSTEMS
Your Company believes that internal control is a necessaryadjunct to the principle of governance that freedom ofmanagement should be exercised within a framework ofappropriate checks and balances Your Company remainscommitted to ensuring an effective internal controlenvironment that provides assurance and comfort on orderlyand efficient conduct of operations security of assetsprevention and detection of frauds errors accuracy andcompleteness of accounting records and timely preparationof reliable financial information
Your Companyrsquos independent and robust Internal Auditprocesses provide assurance on the adequacy andeffectiveness of internal controls compliance withoperating systems internal policies and regulatoryrequirements
The Internal Audit function consisting of an outsourcedprofessional firm is adequately resourced to deliver highstandards of audit assurances
The Audit Committee of your Board met four times duringthe year The Terms of Reference of the Audit Committeeincluded reviewing the adequacy and effectiveness of theinternal control environment monitoring implementationof the action plans emerging out of Internal Audit findingsincluding those relating to strengthening of your Companyrsquosrisk management systems and discharge of statutorymandate
HUMAN RESOURCE DEVELOPMENT
Your Company firmly believes that employees are the vitaland most valuable assets and hence has created afavourable work environment that encourages innovationand meritocracy Your Company continues to innovate inthe way human resources are managed and developedstriking a balance between business needs and individualaspirations
With an undying commitment to render delightful servicesyour Companyrsquos employees consistently work towardsdelivering flawless performance and are continuing todelight customers
The Company provides a safe secure inclusive and genderfriendly workplace The Company has put in placeGrievance Redressal Procedures and adopted a Policy onSexual Harassment as per the provisions of the SexualHarassment of W omen at W orkplace (PreventionProhibition and Redressal) Act 2013 and the Rules framedthereunder The Company has an Internal ComplaintsCommittee to ensure that grievances in this regard if anyare effectively addressed During the year under review nocomplaint relating to sexual harassment has beenreceived
WHISTLEBLOWER POLICY
The Companyrsquos W histleblower Policy encouragesDirectors and employees to bring to the Companyrsquosattention instances of unethical behavior actual orsuspected incidents of fraud actual or suspectedinstances of leak of unpublished price sensitive informationor violation of the GHL Code of Conduct that could adverselyimpact the Companyrsquos operations business performanceand or reputation The Policy provides that the Companyinvestigates such incidents when reported in an impartialmanner and takes appropriate action to ensure that therequisite standards of professional and ethical conductare always upheld It is the Companyrsquos Policy to ensurethat no employee is victimised or harassed for bringingsuch incidents to the attention of the Company
The practice of the Whistleblower Policy is overseen by theAudit Committee and no employee has been denied accessto the Committee The Whistleblower Policy is available onthe Companyrsquos website at httpwwwgujarathotelsltdinCorporateGovernancehtml
DEPOSITS
Your Company has not accepted any deposits from thepublic members under Section 73 of the Companies Act2013 (lsquothe Actrsquo) read with the Companies (Acceptance ofDeposits) Rules 2014 during the year
DIRECTORS
Changes in Directors
Mr R C Mehta stepped down as Non-Executive IndependentDirector of the Company with effect from close of work on31st March 2019 keeping in view the Regulation 17(1A) ofthe Listing Regulations 2015 Your Directors would like torecord their appreciation for the services rendered byMr Mehta
The Board at the meeting held on 15th April 2019 on therecommendation of the Nominations and RemunerationCommittee recommended for the approval of the Membersthe re-appointment of Mr C K Koshy and Mr M Narayananas independent directors of your Company in terms ofSection 149 of the Act and Regulation 17 of the ListingRegulations 2015 with effect from 29th September 2019
Requisite Notices under Section 160 of the Act have beenreceived in respect of Messrs Koshy and Narayanan whohave filed their consents to act as Directors of the Companyif appointed
Appropriate resolutions seeking your approval to theaforesaid appointment will appear in the Notice conveningthe Thirty Seventh AGM of your Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
23
Retirement by Rotation
In accordance with the provisions of Section 152 of the Actread with Article 147 of the Articles of Association of theCompany Mr Jagdish Singh will retire by rotation at theensuing Annual General Meeting (lsquoAGMrsquo) of your Companyand being eligible offers himself for re-election Your Boardrecommends his re-election
Number of Board Meetings
During the year ended 31st March 2019 four meetings ofthe Board were held
Attributes Qualifications amp Independence of Directorsand their Appointment
As reported last year the Nominations and RemunerationCommittee of the Board had approved the criteria fordetermining qualifications positive attributes andindependence of Directors in terms of the Act and the Rulesthereunder both in respect of Independent Directors andother Directors as applicable The criteria inter aliarequires that NonndashExecutive Directors includingIndependent Directors be drawn from amongst eminentprofessionals with experience in business finance law public administration and enterprises
The Board Diversity Policy of the Company requires theBoard to have a balance of skills experience and diversityof perspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the lsquoReport on CorporateGovernancersquo forming part of the Report and Accounts TheArticles of Association of the Company provide that thestrength of the Board shall not be fewer than three normore than twelve
Directors are appointed re-appointed with the approval ofthe Members All Directors other than IndependentDirectors are liable to retire by rotation unless otherwiseapproved by the Members One-third of the Directors whoare liable to retire by rotation retire every year and areeligible for re-election
The Independent Directors of your Company haveconfirmed that (a) they meet the criteria of independenceas prescribed under Section 149 of the Act and Regulation16 of the Listing Regulations 2015 and (b) they are notaware of any circumstance or situation which could impairor impact their ability to discharge duties with an objectiveindependent judgement and without any external influenceFurther in the opinion of the Board the IndependentDirectors fulfil the conditions prescribed under the ListingRegulations 2015 and are independent of the managementof the Company
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpw w wg u j a ra th o te ls l td in p o l i c ies R em u n era t io n -
Policy_GHLpdf There has been no change in the Policyduring the year
Board Evaluation
The Nominations and Remuneration Committee hasapproved the Policy on Board Evaluation Evaluation ofBoard Committeesrsquo functioning and individual DirectorEvaluation and also specified that such evaluation will bedone by the Board Board performance is assessed againstthe role and responsibilities of the Board as provided inthe Act and the Listing Regulations 2015 The parametersfor Board performance evaluation have been derived fromthe Boardrsquos core role of trusteeship to protect and enhanceshareholder value as well as fulfil expectations of otherstakeholders through strategic supervision of the CompanyEvaluation of functioning of Board Committees is basedon discussions amongst Committee members and sharedby each Committee Chairman with the Board IndividualDirectors are evaluated in the context of the role played byeach Director as a member of the Board at its meetingsand in assisting the Board in realising its role of strategicsupervision of the functioning of the Company in pursuit ofits purpose and goals
While the Board evaluated its performance against theparameters laid down by the Nominations andRemuneration Committee the evaluation of individualDirectors was carried out anonymously in order to ensureobjectivity The Board was briefed on functioning of BoardCommittees by the respective Committee Chairmen
Key Managerial Personnel
Mr Deependra Rana resigned as the Chief Executive Officerof the Company with effect from 17th December 2018
The Board at the meeting held on 30th January 2019 onthe recommendation of the Nominations andRemuneration Committee appointed Mr Kunal Pahwa asthe Chief Executive Officer of the Company with effect from1st February 2019
AUDIT COMMITTEE amp AUDITORS
The composition of the Audit Committee is provided underthe section lsquoBoard of Directors amp Committeesrsquo in the Reportand Accounts
Statutory Auditors
The Statutory Auditors Messrs K C Mehta amp Co CharteredAccountants (KCM) were appointed with your approval atthe Thirty Fifth AGM to hold such office till the conclusion ofthe Fortieth AGM
On the recommendation of the Audit Committee the Boardrecommended for the approval of the Members paymentof remuneration of KCM for the financial year 2019-20Appropriate resolution for this purpose will appear in theNotice convening the Thirty Seventh AGM of the Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
24
Secretarial Auditors
Your Board appointed Messrs PB amp Associates CompanySecretaries to conduct the secretarial audit of the Companyfor the financial year ended 31st March 2019 Their Reportis provided in the Annexure forming part of this Report interms of Section 204 of the Act
RELATED PARTY TRANSACTIONS
All contracts or arrangements entered into by the Companywith its related parties during the financial year were inaccordance with the provisions of the Act and the ListingRegulations 2015 All such contracts or arrangements wereentered in the ordinary course of business and on armrsquoslength basis and have been approved by the AuditCommittee
Further the details of related party transactions of theCompany in prescribed Form No AOC-2 in terms of Section134 of the Act read with Rule 8 of the Companies (Accounts)Rules 2014 is given in the Annexure to this Report YourCompanyrsquos Policy on Related Party Transactions asadopted by your Board can be accessed on the website ath t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_Transactionspdf
DIRECTORSrsquo RESPONSIBILITY STATEMENT
As required under Section 134 of the Act your Directorsconfirm having
a) followed in the preparation of the Annual Accounts theapplicable Accounting Standards with properexplanation relating to material departures if any
b) selected such accounting policies and applied themconsistently and made judgements and estimates thatare reasonable and prudent so as to give a true andfair view of the state of affairs of your Company at theend of the financial year and of the profit of yourCompany for that period
c) taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with theprovisions of the Act for safeguarding the assets ofyour Company and for preventing and detecting fraudand other irregularities
d) prepared the Annual Accounts on a going concernbasis
e) laid down internal financial controls to be followed byyour Company and that such internal financial controlswere adequate and operating effectively and
f) devised proper systems to ensure compliance withthe provisions of all applicable laws and that suchsystems were adequate and operating effectively
OTHER INFORMATION
Compliance with the conditions of Corporate Governance
The certificate of the Statutory Auditors Messrs K C Mehtaamp Co Chartered Accountants confirming compliance withthe conditions of Corporate Governance as stipulated underthe Listing Regulations 2015 is annexed
Compliance with Secretarial Standards
The Company is in compliance with the applicableSecretarial Standards issued by the Institute of CompanySecretaries of India and approved by the CentralGovernment under Section 118 of the Act
Cost Records
The Company is not required to maintain cost records interms of Section 148 of the Act read with the Companies(Cost Records and Audit) Rules 2014
Going Concern Status
There is no significant or material order passed during theyear by any regulator court or tribunal impacting the goingconcern status of the Company or its future operations
Extract of Annual Return
The information required under Section 134 of the Act readwith Rule 12 of the Companies (Management andAdministration) Rules 2014 is annexed
Particulars of Loans Guarantees or Investments
During the year ended 31st March 2019 the Company hasneither given any loan or guarantee nor has made anyinvestment under the provisions of Section 186 of the Act
Particulars relating to Conservation of Energy andTechnology Absorption
Particulars as required under Section 134 of the Act relatingto Conservation of Energy and Technology Absorption areprovided below-
Conservation of Energy
Steps taken on conservation of energy and impact thereof
Sl DescriptionNo
1 Installation of energy efficient Gas Burners and Induction Cooker
2 Improvement in energy usage efficiency in lighting system by changingover to efficient lighting solutions such as Light Emitting Diodes
3 Replacement of existing motors and pumps with more energy efficientequipment
4 Process improvement to enhance productivity and reduce specificenergy consumption
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
25
There were no employees who were employed throughoutthe year and were in receipt of remuneration aggregating` 102 crores or more or were employed for part of the yearand were in receipt of remuneration aggregating ` 850lakhs per month or more during the financial year ended31st March 2019
The information pursuant to Section 197 of the Act readwith Rule 5(2) and 5(3) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014containing the names of top 10 employees in terms ofremuneration drawn is provided in the Annexure formingpart of this report
The information required under Section 197(12) of the Actand the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is provided in theAnnexure forming part of this Report
FORWARD-LOOKING STATEMENTS
This Report contains forward-looking statements thatinvolve risks and uncertainties When used in this Reportthe words lsquoanticipatersquo lsquobelieversquo lsquoestimatersquo lsquoexpectrsquo lsquointendrsquolsquowillrsquo and other similar expressions as they relate to theCompany and or its Businesses are intended to identifysuch forward-looking statements The Companyundertakes no obligation to publicly update or revise anyforward-looking statements whether as a result of newinformation future events or otherwise Actual resultsperformances or achievements could differ materially fromthose expressed or implied in such forward-lookingstatements Readers are cautioned not to place unduereliance on these forward-looking statements that speakonly as of their dates This Report should be read inconjunction with the financial statements included hereinand the notes thereto
CONCLUSION
Your Directors and employees look forward to the futurewith confidence and stand committed to creating an evenbrighter future for all stakeholders
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
Steps taken by the Company for utilising alternate sourcesof energy NIL
Capital investment on energy conservation equipment NIL
Technology Absorption
i) Efforts in brief made towards technology absorptionand benefits derived as a result of the above effortseg product improvement cost reduction productdevelopment import substitution etc
Sl Description BenefitsNo
1 Upgradation of Fire Alarm and For Product UpgradationPublic Announcement system
2 Installation of Hoods and Fire For Product UpgradationSuppression system
3 Upgradation of CCTV monitoring For Product Upgradationsystem
4 Upgradation of Electrical Panel For Product Improvement5 Induction of Diesel Generator For Product Improvement
ii) In case of imported technology (imported during thelast 3 years reckoned from the beginning of the financialyear) following information may be furnished
A) Details of technology imported - NIL
B) Year of import - NIL
C) Whether the technology has been fully absorbed -NIL
D) If not fully absorbed areas where absorption hasnot taken place and the reasons therefor - NIL
iii) Expenditure incurred on research and development -NIL
FOREIGN EXCHANGE EARNINGS AND OUTGO
During the financial year 2018-19 foreign exchangeearnings of the Hotel aggregated ` 111754 lakhs (previousyear ` 95887 lakhs) while expenditure in foreign currencyaggregated ` 5514 lakhs (previous year ` 3230 lakhs)
EMPLOYEES
The total number of employees of the Company as on31st March 2019 stood at 198
26
ANNEXURE
FORM NO MR ndash 3SECRETARIAL AUDIT REPORTFOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019[Pursuant to Section 204(1) of the Companies Act 2013 and Rule9 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014]
ToThe MembersGujarat Hotels LimitedWe have conducted the secretarial audit of the compliance ofapplicable statutory provisions and the adherence to goodcorporate practices by Gujarat Hotels Limited a Companyincorporated under the provisions of the Companies Act 1956 andhaving its Registered Office at WelcomHotel Vadodara R C DuttRoad Alkapuri Vadodara Gujarat ndash 390 007 (hereinafter referredto as the lsquoCompanyrsquo) for the period commencing from 1st April2018 till 31st March 2019 (hereinafter referred to as the lsquoAuditPeriodrsquo) Secretarial Audit was conducted in a manner that providedus a reasonable basis for evaluating the corporate conducts statutory compliances and expressing our opinions thereonBased on our verification of the books papers minute booksforms and returns filed and other records maintained by theCompany and also the information provided by the Company itsofficers agents and authorised representatives during the conductof Secretarial Audit 2018-19 we hereby report that in our opinionthe Company has during the audit period covering the FinancialYear ended on 31st March 2019 complied with the statutoryprovisions listed hereunder and also that the Company has properBoard-processes and compliance-mechanism in place to theextent in the manner and subject to the reporting made hereinafterWe have examined the books papers minute books forms andreturns filed and other records maintained by the Company for thefinancial year ended on 31st March 2019 according to theprovisions of(i) The Companies Act 2013 (the Act) and the Rules made
thereunder(ii) The Securities Contracts (Regulation) Act 1956 (lsquoSCRArsquo)
and the Rules made thereunder(iii) The Depositories Act 1996 and the Regulations and
Bye-laws framed thereunder(iv) Foreign Exchange Management Act 1999 and the Rules and
Regulations made thereunder to the extent of Foreign DirectInvestment Overseas Direct Investment and ExternalCommercial Borrowings
(v) The following Regulations and Guidelines prescribed underthe Securities and Exchange Board of India Act 1992(lsquoSEBI Actrsquo)-(a) The Securities and Exchange Board of India
(Substantial Acquisition of Shares and Takeovers)Regulations 2011
(b) The Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations 2015
(c) The Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations2015
(d) The Securities and Exchange Board of India(Registrars to an Issue and Share Transfer Agents)Regulations 1993 regarding the Companies Act anddealing with client
We have also examined compliance with the applicable clauses ofthe following(i) The mandatory Secretarial Standards issued by The Institute
of Company Secretaries of India with respect to BoardMeetings and General Meetings
(ii) The SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015
The Company has entered into an Operating Licence Agreementwith ITC Limited which operates the Hotel ndash WelcomHotel Vadodraand ensure compliance of all laws as applicable for running andmaintenance of the HotelDuring the period under review the Company has complied withthe provisions of the Act Rules Regulations Guidelines andStandards etc as mentioned above however in the CorporateGovernance Report filed pursuant to Regulation 27(2) of SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015with BSE for the quarter ended September and December 2018there is mismatch of date of the meetingWe further report thatThe Board of Directors of the Company is duly constituted withproper balance of Non-Executive Directors and IndependentDirectors The changes in the composition of the Board of Directorsthat took place during the period under review were carried out incompliance with provisions of the ActAdequate notice is given to all Directors for the Board Meetingsand Committees Meetings agenda and detailed notes on agendawere sent at least seven days in advance and where the meetingwas held in shorter notice due compliance was made and a systemexists for seeking and obtaining further information and clarificationson the agenda items before the meeting for meaningful participationat the meetingAll decisions at Board Meetings and Committee Meetings werecarried out unanimously as recorded in the minutes of the meetingsof the Board of Directors or Committees of the Board as the casemay beWe report that there are adequate systems and processes in theCompany commensurate with the size and operations of theCompany to monitor and ensure compliance with the applicableLaws Rules Regulations and GuidelinesWe further report that during the Audit Period the Company has nospecific events actions that have a major bearing on the Companyrsquosaffairs in pursuance of the above referred Laws RulesRegulations Guidelines Standards etc
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
Note This report is to be read with our letter of even date whichis annexed as Annexure A and forms an integral part of thisreport
27
FORM NO AOC-2[Pursuant to Section 134(3)(h) of the Companies Act 2013 and Rule 8(2) of the Companies (Accounts) Rules 2014]
Form for disclosure of particulars of contracts arrangements entered into by the Company with related parties referred to insub-section (1) of Section 188 of the Companies Act 2013 including certain arms length transactions under fourth proviso thereto
1 Details of contracts or arrangements or transactions not at arms length basis
a) Name(s) of the related party and nature of relationshipb) Nature of contracts arrangements transactionsc) Duration of the contracts arrangements transactionsd) Salient terms of the contracts or arrangements or transactions including the value if anye) Justification for entering into such contracts or arrangements or transactions NILf ) Date(s) of approval by the Boardg) Amount paid as advances if anyh) Date on which the special resolution was passed in general meeting as required under first proviso to Section 188
2 Details of material contracts or arrangement or transactions at arms length basis
a) Name(s) of the related party and nature of ITC Limited of which the Company is an Associaterelationship
b) Nature of contracts arrangements transactions Agreement for operating the Companyrsquos Hotel
c) Duration of the contracts arrangements Operating License Agreement (OLA) dated 24th September 1992 for an initialtransactions period of 30 years and renewable for another period of 30 years The OLA
emanated from the rehabilitation package agreed amongst Gujarat State GovtFinancial Institutions viz IFCI amp SBI and ITC in the year 1990
d) Salient terms of the contracts or arrangements The Company receives Licence fees 15 of Net Operating Income Valueor transactions including the value if any of transaction during the year ` 370 crores
e) Date(s) of approval by the Board if any 24th September 1992f ) Amount paid as advances if any Nil
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Annexure AToThe MembersGujarat Hotels Limited
Our report of even date is to be read along with this letter
1 Maintenance of secretarial record is the responsibilityof the management of the Company Our responsibilityis to express an opinion on these secretarial recordsbased on our audit
2 We have followed the audit practices and processesas were appropriate to obtain reasonable assuranceabout the correctness of the contents of the secretarialrecords The verification was done on the randomtest basis to ensure that correct facts are reflected insecretarial records We believe that the processesand practices we followed provide a reasonablebasis for our opinion
3 W e have not verified the correctness andappropriateness of financial records and books ofaccounts of the Company
4 W herever required we have obtained theManagement Representation about the complianceof Laws Rules and Regulations and happening ofevents etc
5 The compliance of the provisions of corporate andother applicable Laws Rules RegulationsStandards is the responsibility of management Ourexamination was limited to the verification ofprocedures on the random test basis
6 The Secretarial Audit Report is neither an assuranceas to the future viability of the Company nor of theefficacy or effectiveness with which the managementhas conducted the affairs of the Company
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
28
INDEPENDENT AUDITORSrsquo CERTIFICATE ON CORPORATE GOVERNANCE
INDEPENDENT AUDITORrsquoS CERTIFICATE ON CORPORATEGOVERNANCE
TO THE MEMBERS OF GUJARAT HOTELS LIMITED
1 We have examined the compliance of conditions ofCorporate Governance by Gujarat Hotels Limited (ldquotheCompanyrdquo) for the year ended on 31st March 2019as stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the Securities and Exchange Board ofIndia (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended(ldquoSEBI Listing Regulationsrdquo)
Managementrsquos Responsibility
2 The compliance of conditions of CorporateGovernance is the responsibility of the ManagementThis responsibility includes the designimplementation and maintenance of internal controland procedures to ensure the compliance with theconditions of the Corporate Governance stipulated inSEBI Listing Regulations
Auditorrsquos Responsibility
3 Our responsibility is limited to examining theprocedures and implementation thereof adopted bythe Company for ensuring the compliance of theconditions of the Corporate Governance It is neitheran audit nor an expression of opinion on the financialstatements of the Company
4 We have examined the books of account and otherrelevant records and documents maintained by theCompany for the purpose of providing reasonableassurance on the compliance with CorporateGovernance requirements by the Company
5 We have carried out an examination of the relevantrecords of the Company in accordance with theGuidance Note on Certification of CorporateGovernance issued by the Institute of CharteredAccountants of India (ldquothe ICAIrdquo) the Standards onAuditing specified under Section 143(10) of theCompanies Act 2013 in so far as applicable for the
purpose of this certificate and as per the GuidanceNote on Reports or Certificates for Special Purposesissued by the ICAI which requires that we comply withthe ethical requirements of the Code of Ethics issuedby the ICAI
6 W e have complied with the relevant applicablerequirements of the Standard on Quality Control (SQC)1 Quality Control for Firms that Perform Audits andReviews of Historical Financial Information and otherAssurance and Related Services Engagements
Opinion
7 Based on our examination of the relevant recordsand according to the information and explanationsprovided to us and representations provided by theManagement we certify that the Company hascomplied with the conditions of Corporate Governanceas stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the SEBI Listing Regulations asapplicable for the year ended 31st March 2019
8 W e state that such compliance is neither anassurance as to the future viability of the Companynor the efficiency or effectiveness with which theManagement has conducted the affairs of theCompany
Restrictions on Use
9 This Certificate is issued solely for the purpose ofcomplying with the aforesaid SEBI ListingRegulations and may not be suitable for any otherpurpose
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
29
ANNEXURE
FORM NO MGT-9EXTRACT OF ANNUAL RETURN
as on the Financial Year ended on 31st March 2019[Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the
Companies (Management and Administration) Rules 2014]
I REGISTRATION AND OTHER DETAILS
i) CIN L55100GJ1982PLC005408ii) Registration Date 7th August 1982iii) Name of the Company Gujarat Hotels Limitediv) Category Sub-Category of the Company Public company - Limited by sharesv) Address of the Registered office and contact details WelcomHotel Vadodara
R C Dutt Road AlkapuriVadodara 390 007Tel No 0265-233 0033E-mail ghlinvestorsyahoocoin
vi) Whether Listed Company Yesvii) Name Address and Contact details of MCS Share Transfer Agent Limited
Registrar and Transfer Agent if any F - 65 Okhla Industrial Area Phase - INew Delhi - 110 020Tel Nos (011) 4140 6149-52 4160 9386
II PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY
III PARTICULARS OF HOLDING SUBSIDIARY AND ASSOCIATE COMPANIES NIL
Sl No
Name and Description of main products services NIC Code of the products services
to total turnover of the Company
1 Hotel Services 55101 100
30
IV SHAREHOLDING PATTERN (Equity Share Capital Break-up as percentage of Total Equity)(i) Category-wise Shareholding
Category of Shareholders No of Shares held at the beginningof the year
No of Shares held at the endof the year
Changeduring the
year
A Promoters(1) Indiana) Individual HUF 0 0 0 0 0 0 0 0 0b) Central Govt 0 0 0 0 0 0 0 0 0c) State Govt(s) 0 0 0 0 0 0 0 0 0d) Bodies Corp 2033963 0 2033963 5370 2033963 0 2033963 5370 0e) Banks FI 0 0 0 0 0 0 0 0 0f ) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(1) 2033963 0 2033963 5370 2033963 0 2033963 5370 0(2) Foreigna) NRIs - Individuals 0 0 0 0 0 0 0 0 0b) Other - Individuals 0 0 0 0 0 0 0 0 0c) Bodies Corp 0 0 0 0 0 0 0 0 0d) Banks FI 0 0 0 0 0 0 0 0 0e) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(2) 0 0 0 0 0 0 0 0 0Total Shareholding of Promoter(A) = (A)(1)+(A)(2) 2033963 0 2033963 5370 2033963 0 2033963 5370 0B Public Shareholding1 Institutionsa) Mutual Funds 0 0 0 0 0 0 0 0 0b) Banks FI 0 100 100 0 100 100 c) Central Govt 0 0 0 0 0 0 0 0 0d) State Govt(s) 0 0 0 0 0 0 0 0 0e) Venture Capital Funds 0 0 0 0 0 0 0 0 0f ) Insurance Companies 0 0 0 0 0 0 0 0 0g) FIIs 10 0 10 0 0 0 h) Foreign Venture Capital Funds 0 0 0 0 0 0 0 0 0i) Others (specify) 0 0 0 0 0 0 0 0 0Sub-total (B)(1) 10 100 110 0 100 100 2 Non-Institutionsa) Bodies Corpi) Indian 300003 2200 302203 798 191626 2100 193726 511 (287)ii) Overseas 0 0 0 0 0 0 0 0 0b) Individualsi) Individual shareholders holding
nominal share capital upto` 1 lakh 774322 231562 1005884 2656 797094 203602 1000696 2643 (013)
ii) Individual shareholders holdingnominal share capital inexcess of ` 1 lakh 220814 0 220814 583 334765 0 334765 884 301
c) Others (specify)i) Non Resident Individuals 44288 71500 115788 306 45662 56700 102362 270 (036)ii) Investor Education and
Protection Fund AuthorityMinistry of Corporate Affairs 108753 0 108753 287 121903 0 121903 322 035
Sub-total (B)(2) 1448180 305262 1753442 4630 1491050 262402 1753452 4630 0Total Public Shareholding(B)=(B)(1)+ (B)(2) 1448190 305362 1753552 4630 1491050 262502 1753552 4630 0C Shares held by Custodian
for GDRs amp ADRs 0 0 0 0 0 0 0 0 0Grand Total (A+B+C) 3482153 305362 3787515 100 3525013 262502 3787515 100 0
Demat Physical Total of TotalShares
Demat Physical Total of TotalShares
ANNEXURE
31
1 Savi Portfolio Management Services LimitedAt the beginning of the year 122218 323Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 122218 323
2 Muktilal Ganulal PaldiwalAt the beginning of the year 82742 218Increase Decrease in Shareholding during the year06042018 220 001 82962 21913042018 250 001 83212 22001062018 927 002 84139 22215062018 700 002 84839 22427072018 412 001 85251 22505102018 1000 003 86251 22830112018 500 001 86751 22931122018 958 003 87709 23218012019 124 000 87833 23208022019 1070 003 88903 23501032019 467 001 89370 23615032019 1000 003 90370 23922032019 200 001 90570 24031032019 50 000 90620 240At the end of the year 90620 240
3 Taradevi Muktilal PaldiwalAt the beginning of the year 31628 084
(ii) Shareholding of Promoters (including Promoter Group)
(iii) Change in Promotersrsquo Shareholding (please specify if there is no change)
SlNo
Shareholders NameNo of
Shares of total
Sharesof the
Company
of Sharespledged
encumbered tototal Shares
No ofShares
of totalShares
of theCompany
of Sharespledged
encumbered tototal Shares
change inShareholding
during the year
1 ITC Limited 1733907 4578 Nil 1733907 4578 Nil Nil
2 Russell Investments Limited 300056 792 Nil 300056 792 Nil Nil
Shareholding at the beginning of the year Shareholding at the end of the year
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
(iv) Shareholding Pattern of top ten Shareholders (other than Directors Promoters and Holders of GDRs and ADRs)
ANNEXURE
No of Shares
Sl No
Particulars Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares of total Shares of the Company
No of Shares of total Shares of the Company
At the beginning of the year
No Change during the year Increase Decrease in Promoters Shareholding during the year
At the end of the year
32
Increase Decrease in Shareholding during the year06042018 180 000 31808 08413042018 53 000 31861 08420042018 1449 004 33310 08827042018 1933 005 35243 09304052018 1060 003 36303 09611052018 2196 006 38499 10218052018 1343 004 39842 10625052018 1191 003 41033 10906072018 1600 004 42633 11313072018 1678 004 44311 11720072018 2095 006 46406 12327072018 3735 010 50141 13303082018 415 001 50556 13410082018 685 002 51241 13624082018 1169 003 52410 13931082018 1616 004 54026 14307092018 1655 004 55681 14714092018 1311 003 56992 15021092018 2480 007 59472 15729092018 2259 006 61731 16305102018 1534 004 63265 16712102018 976 003 64241 17019102018 64 000 64305 17026102018 600 002 64905 17202112018 605 002 65510 17409112018 4 000 65514 17416112018 143 000 65657 17430112018 2299 006 67956 18007122018 515 001 68471 18114122018 10 000 68481 18121122018 590 002 69071 18331122018 600 002 69671 18504012019 1000 003 70671 18825012019 21 000 70692 18801022019 701 002 71393 19008022019 388 001 71781 19115022019 714 002 72495 19301032019 700 002 73195 19515032019 34 000 73229 195At the end of the year 73299 195
4 Shah Viren ShantilalAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 14122018 26965 071
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
ANNEXURE
33
Increase Decrease in Shareholding during theyear ie wef 1412201811012019 28946 076 55911 14701022019 7194 019 63105 166At the end of the year 63105 166
5 Chirayush Pravin VakilAt the beginning of the year 27482 073Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 27482 073
6 Falguni Nilesh DedhiaAt the beginning of the year 18000 048Increase Decrease in Shareholding during the year27042018 5175 014 23175 062At the end of the year 23175 062
7 Classic Realties Private LimitedAt the beginning of the year 23061 061Increase Decrease in Shareholding during the year31082018 100 000 23161 061At the end of the year 23161 061
8 Dheeraj Kumar LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 20000 053
9 Karvy Stock Broking LimitedAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 30112018 23063 061Increase Decrease in Shareholding during theyear ie wef 3011201807122018 149 000 23212 06114122018 (8165) (022) 15047 03931122018 7128 019 22175 05804012019 3087 008 25262 06611012019 (23721) (063) 1541 00331032019 15274 040 16815 043At the end of the year 16815 043 Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company Includes shares acquired during the period when not part of the top ten Shareholders of the Company
10 Sonal LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year20042018 (1000) (003) 19000 050
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
34
311218 0 000 0 00011012019 0 000 0 00031032019 (5000) (013) 14000 037At the end of the year 14000 037 Ceased to be part of the top ten Shareholders of the Company Became a part of the top ten Shareholders of the Company
11 Rajasthan Global Securities Private LimitedAt the beginning of the year 98659 260Increase Decrease in Shareholding during the year20042018 (4756) (013) 93903 24727042018 (5596) (015) 88307 23206072018 (790) (002) 87517 23027072018 (8520) (022) 78997 20802112018 (10975) (029) 68022 17916112018 (4) 000 68018 17930112018 (6189) (016) 61829 16307122018 (170) 000 61659 16314122018 (18503) (049) 43156 11421122018 (417) (001) 42739 11331122018 (11108) (029) 31631 08404012019 (5000) (013) 26631 07111012019 (5000) (013) 21631 05825012019 (2800) (007) 18831 05101022019 0 000 0 000At the end of the year NA NA Ceased to be a part of the top ten Shareholders of the Company
12 Dinesh Mukilal PaldiwalAt the beginning of the year 10522 028Increase Decrease in Shareholding during the year03082018 112 000 10634 02810082018 424 001 11058 02907092018 500 001 11558 03021092018 85 000 11643 03005102018 1000 003 12643 03302112018 0 000 12643 03301022019 0 000 12643 03315022019 300 001 12943 03431032019 0 000 12943 034At the end of the year NA NA Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company
Note Increase decrease in shareholding as indicated above are based on downloads of beneficial ownership provided by the Depositories generally everyFriday
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
35
(v) Shareholding of Directors and Key Managerial Personnel
ANNEXURE
Ms D R Choudhury Messrs C K Koshy R C Mehta M Narayanan and J Singh Directors Messrs M Agarwal andD K Gulati Key Managerial Personnel did not hold any Shares of the Company either at the beginning or at the end of theyear or at any time during the year
Mr K Pahwa Chief Executive Officer also did not hold any Shares of the Company either at the time of his appointment or atthe end of the year or at any time during the year
V INDEBTEDNESSIndebtedness of the Company including interest outstanding accrued but not due for payment NIL
VI REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNELA Remuneration to Managing Director Wholetime Directors and or Manager NOT APPLICABLE
B Remuneration to the other Directors(Amount in `)
Ceased to be Non-Executive Independent Director with close of work on 31st March 2019
Sl No For each of the Director
Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares held singly
jointly
of total Shares of the
Company
No of Shares held singly
jointly
of total Shares of the
Company
1 N Anand (Chairman)
At the beginning of the year 200 0
Increase Decrease in Shareholding during the year
0 0 0 0
At the end of the year 200 0
Sl No Directors
Particulars of Remuneration
Total Amount Fee for attending Board Board
Committee Meetings
Commission Independent Directors
Meeting Fees 1 Independent Directors
C K Koshy 140000 0 10000 150000 R C Mehta 70000 0 0 70000 M Narayanan 140000 0 10000 150000
Total (B)(1) 350000 0 20000 370000 2 Other Non-Executive Directors
N Anand 0 0 0 0 D R Choudhury 0 0 0 0 J Singh 0 0 0 0
Total (B)(2) 0 0 0 0 Total (B) = (B)(1) + (B)(2) 370000 Total Managerial Remuneration (A+B) 370000
Overall ceiling as per the Act (Being 11 of the Net Profits of the Company as calculated under Section 198 of the Companies Act 2013)
3759620
36
C Remuneration to Key Managerial Personnel other than MD Manager WTD(Amount in `)
Mr K Pahwa was appointed as Chief Executive Officer wef 1st February 2019
VII PENALTIES PUNISHMENT COMPOUNDING OF OFFENCES
against the Company Directors and other Officers in Default under the Companies Act 2013 NONE
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Sl No
Particulars of Remuneration Key Managerial Personnel
Total Amount
K Pahwa Chief Executive
Officer
M Agarwal Chief Financial
Officer
D K Gulati Company Secretary
1 Gross Salary
(a) Salary as per provisions contained in Section 17(1) of the Income-tax Act 1961
377472 2883242 880140 4140854
(b) Value of perquisites under Section 17(2) of the Income-tax Act 1961
242908 136154 0 379062
(c) Profits in lieu of salary under Section 17(3) of the Income-tax Act 1961
0 0 0 0
2 Stock Option 0 0 0 0 3 Sweat Equity 0 0 0 0 4 Commission
- as of profit - others specify
0 0 0 0
5 Others please specify 0 0 0 0 Total Amount 620380 3019396 880140 4519916
37
Services reverted to ITC Limited effective 17th December 2018 Reflects revision in remuneration effective 1st October 2018
Notes1 The number of permanent employees as on 31st March 2019 was 1982 Compared to 2017-18 the figures for 2018-19 reflect that
i) Median remuneration of employees - Increased by 965ii) Average remuneration of employees excluding Key Managerial Personnel (KMP) - Increased by 1040 with
increase in number of employeesiii) Remuneration of KMP - Increased by 1321 due to revision in remuneration during the year
3 Remuneration of Directors KMP and other employees is in accordance with the Companys Remuneration Policy
A Information pursuant to Section 197 of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014
Name of Directors ampKey ManagerialPersonnel
Designation Ratio of Remuneration toMedian Remuneration of
all employees
Increase inRemuneration over
LY ()
ANNEXURE
N Anand Non-Executive Chairman - -
D R Choudhury Non-Executive Director - -
C K Koshy Independent Director 0731 7
R C Mehta Independent Director 0341 -
M Narayanan Independent Director 0731 7
J Singh Non-Executive Director - -
D Rana Chief Executive Officer 12681 (15)
K Pahwa Chief Executive Officer (wef 1st February 2019) 3111 -
M Agarwal Chief Financial Officer 15281 24
D K Gulati Company Secretary 4371 8
38
O
n de
puta
tion
from
ITC
Lim
ited
(ITC
)
Ser
vice
s re
verte
d to
ITC
effe
ctiv
e 17
th D
ecem
ber
2018
N
otes
a
Gro
ss r
emun
erat
ion
incl
udes
sal
ary
var
iabl
e pa
y C
ompa
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con
tribu
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to p
rovi
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d a
llow
ance
s amp
oth
er b
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uity
and
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e en
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t w
hich
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uaria
lly d
eter
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n an
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rall
Com
pany
bas
is
The
ter
m r
emun
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ion
has
the
mea
ning
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d to
it
unde
r th
eC
ompa
nies
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20
13
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et r
emun
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ion
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pris
es c
ash
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me
less
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dent
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dc
All
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n ac
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pany
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ules
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oyee
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e ne
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any
Dire
ctor
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the
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d an
y eq
uity
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re i
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e C
ompa
ny
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form
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n pu
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nt t
o Se
ctio
n 19
7 of
the
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pani
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ct 2
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es 5
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App
oint
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t an
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eria
l Per
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ules
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On
beha
lf of
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rd
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ce
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hiD
R C
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J S
ingh
Dat
e 1
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il 2
019
Dire
ctor
Dire
ctor
Desig
natio
nGr
oss
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n(`
)
Net
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uner
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n(`
)
Quali
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ions
Date
ofco
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n
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Em
ploy
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t Po
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n He
ld
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56
78
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e(Y
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)Na
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Top
ten
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term
s of r
emun
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yur A
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al33
Chief
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ncial
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9
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e Of
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ited
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l Man
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umar
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any
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etary
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m
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S
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ligar
e Sec
uritie
s Lim
ited
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ompli
ance
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an Ja
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ajan
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sistan
t Man
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7366
8164
6118
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A P
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501
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e Fer
n Hote
l(M
arke
ting)
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ager
Kuna
l Pah
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ief E
xecu
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INFORMATION US 197 OF THE COMPANIES ACT 2013
39
CEO AND CFO COMPLIANCE CERTIFICATE
We Kunal Pahwa Chief Executive Officer and Mayur Agarwal Chief Financial Officer certify that
a) We have reviewed the financial statements including the cash flow statement for the year ended 31st March 2019 andto the best of our knowledge and belief
i) these statements do not contain any materially untrue statement or omit any material fact or contain statementsthat might be misleading
ii) these statements together present a true and fair view of the Companyrsquos affairs and are in compliance with IndianAccounting Standards applicable laws and regulations
b) To the best of our knowledge and belief no transactions entered into by the Company during the year ended31st March 2019 are fraudulent illegal or violative of the Companyrsquos code of conduct
c) We accept responsibility for establishing and maintaining internal controls for financial reporting and we have evaluatedthe effectiveness of the internal control systems of the Company pertaining to financial reporting Deficiencies in thedesign or operation of such internal controls if any of which we are aware have been disclosed to the auditors and theAudit Committee and steps have been taken to rectify these deficiencies
d) i) There has not been any significant change in internal control over financial reporting during the year underreference
ii) The changes in the Significant Accounting Policies arising from the adoption of the Indian Accounting Standardshave been discussed with the auditors and have been approved by the Audit Committee and
iii) We are not aware of any instance during the year of significant fraud with involvement therein of the managementor any employee having a significant role in the Companyrsquos internal control system over financial reporting
Place New Delhi Kunal Pahwa Mayur AgarwalDate 15th April 2019 Chief Executive Officer Chief Financial Officer
40
BALANCE SHEET
As at 31st March 2019Amount in `
Particulars Note As at As at31st March 2019 31st March 2018
ASSETSNon-Current Assetsa) Property Plant and Equipment 2 14695652 15623727b) Other Non-Current Assets 3 6672434 7609451Total Non-Current Assets 21368086 23233178Current Assetsa) Financial Assets
(i) Investments 4 280294894 208482957(ii) Trade Receivables 5 16310661 14154244(iii) Cash and Cash Equivalents 6 763039 900355(iv) Other Bank Balances 7 5489856 53182631(v) Other Financial Assets 8 4724316 6349124
b) Other Current Assets 3 437564 406324Total Current Assets 308020330 283475635Total Assets 329388416 306708813EQUITY AND LIABILITIESEquitya) Equity Share Capital 9 37875150 37875150b) Other Equity 268275037 243468594Total Equity 306150187 281343744LIABILITIESNon-Current Liabilitiesa) Provisions 10 1399224 1270990b) Deferred Tax Liabilities (Net) 11 10745247 11364002Total Non-Current Liabilities 12144471 12634992Current Liabilitiesa) Financial Liabilities
(i) Trade Payablesa) Total outstanding dues of micro enterprises and
small enterprises ndash ndashb) Total outstanding dues of creditors other than
micro enterprises and small enterprises 483074 395920(ii) Other Financial Liabilities 12 9272344 11118126
b) Other Current Liabilities 13 1264039 1172866c) Provisions 10 74301 43165Total Current Liabilities 11093758 12730077Total Equity And Liabilities 329388416 306708813
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
41
STATEMENT OF PROFIT AND LOSS
For the year ended 31st March 2019Amount in `
I Revenue From Operations 14 36986948 33098499
II Other Income 15 19625544 17119109
III Total Income (I+II) 56612492 50217608
IV EXPENSES
Employee Benefits Expense 16 1208580 1094609
Depreciation and Amortization Expense 473636 475984
Other Expenses 17 3107913 3334087
Total Expenses (IV) 4790129 4904680
V Profit Before Tax (III- IV) 51822363 45312928
VI Tax Expense
Current Tax 18 11653499 9272310
Deferred Tax 18 (618755) 2350502
VII Profit for the Year (V-VI) 40787619 33690116
VIII Other Comprehensive Income ndash ndash
IX Total Comprehensive Income for the Year (VII+VIII) 40787619 33690116
X Earnings per Equity Share (Face Value ` 10-each) 19
Basic (in `) 1077 890
Diluted (in `) 1077 890
For the Year For the YearParticulars Note ended ended
31st March 2019 31st March 2018
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
42
For the year ended 31st March 2019
STATEMENT OF CHANGES IN EQUITY
The Board of Directors of the Company recommended a dividend of ` 35 per share (for the year ended 31st March 2018 - dividend ` 350 pershare) be paid on fully paid equity shares This equity dividend is subject to approval by shareholders at the Annual General MeetingThe totalequity dividend to be paid ` 13256303 (for the year ended 31st March 2018 - dividend ` 13256303) Income tax on proposed dividend being` 2724873 (for the year ended 31st March 2018 - ` 2724873)
General Reserve This Reserve is created by an appropriation from one component of equity (generally retained earnings) to another notbeing an item of Other Comprehensive Income The same can be utilized by the Company in accordance with the provisions of the CompaniesAct 2013
Retained Earnings This Reserve represents the cumulative profits of the Company This Reserve can be utilized in accordance with theprovisions of the Companies Act 2013
The accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even dateOn behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
A Equity Share CapitalAmount in `
Balance as at the Changes in equity Balance at thebeginning of the share capital end of the
reporting year during the year reporting yearFor the year ended 31st March 2018 37875150 ndash 37875150For the year ended 31st March 2019 37875150 ndash 37875150
B Other EquityAmount in `
Reserves amp Surplus TotalGeneral Reserve Retained Earnings
Balance as at April 01 2017 30257504 195873461 226130965Total Comprehensive Income for the year ndash 33690116 33690116Dividend ndash 13256303 13256303Income Tax on Dividend Paid ndash 2698671 2698671Dividend Distribution Tax (earlier year) ndash 397513 397513Balance as at March 31 2018 30257504 213211090 243468594Balance as at April 01 2018 30257504 213211090 243468594Total Comprehensive Income for the year ndash 40787619 40787619Dividend ndash 13256303 13256303Income Tax on Dividend Paid 2724873 2724873Balance as at March 31 2019 30257504 238017533 268275037
43
CASH FLOW STATEMENT
For the year ended 31st March 2019
For the Year For the YearParticulars ended ended
31st March 2019 31st March 2018
NOTES1) The above Cash Flow Statement has been prepared under the ldquoIndirect Methodrdquo as set out in Ind AS 7Statement of Cash FlowsrdquoThe accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even date On behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
Amount in `
A Cash Flow from Operating ActivitiesPROFIT BEFORE TAX 51822363 45312928Adjustments for
Depreciation amp Amortisation expense 473636 475984Interest Income (1317822) (3453950)Dividend Income (159984) (178075)Loss on sale of property plant and equipment - Net 445778 (28273)Net gain(loss) on investments mandatorily measuredat fair value through profit or loss (18005340) (13358789)Other Non Operating Income ndash (86856)Other Non Operating Expense ndash 99378
OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 33258631 28782347Adjustments for
Trade Receivables Financial Assets and Other Assets (2815198) (90661)Trade Payables Other Liabilities and Provisions (1568800) 1700052
CASH GENERATED FROM OPERATIONS 28874633 30391738Income Tax Paid(Net) (10407981) (12740273)
NET CASH FROM OPERATING ACTIVITIES 18466652 17651465B Cash Flow from Investing Activities
Sale of Property Plant and Equipment 8661 58452Purchase of Current Investments (224340000) (186220000)SaleRedemption of Current Investments 170532754 183295529Dividend Income 159984 178075Interest Received 3262318 4031382
NET CASH FROM INVESTING ACTIVITIES (50376283) 1343438C Cash Flow from Financing Activities
Dividend Paid (13256303) (13256303)Income Tax on Dividend Paid (2724873) (2698671)
NET CASH FROM FINANCING ACTIVITIES (15981176) (15954974)NET INCREASE IN CASH AND CASH EQUIVALENTS (47890807) 3039929OPENING CASH AND CASH EQUIVALENTS 48653846 45613917CLOSING CASH AND CASH EQUIVALENTS 763039 48653846
CASH AND CASH EQUIVALENTS COMPRISE Cash cheques and current accounts 763039 900355Other Bank BalancesDeposits with original maturity more than 3 months having remainingmaturity less than 12 months from Balance Sheet date ndash 47753491
763039 48653846
44
1 SIGNIFICANT ACCOUNTING POLICIESStatement of ComplianceThese financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) notifiedunder section 133 of the Companies Act 2013 (the Act) read with Companies (Indian Accounting Standards)Rules 2015 (as amended) The financial statements have also been prepared in accordance with the relevantpresentation requirements of the Companies Act 2013
Basis of PreparationThe financial statements are prepared in accordance with the historical cost convention except for certain itemsthat are measured at fair values as explained in the accounting policies below The financial statements arepresented in Indian Rupees (INR) which is also the Companyrsquos functional currency
Fair Value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transactionbetween market participants at the measurement date regardless of whether that price is directly observable orestimated using another valuation technique In estimating the fair value of an asset or a liability the Companytakes into account the characteristics of the asset or liability if market participants would take those characteristicsinto account when pricing the asset or liability at the measurement date
The preparation of financial statements in conformity with Ind AS requires management to make judgementsestimates and assumptions that affect the application of the accounting policies and the reported amounts ofassets and liabilities the disclosure of contingent assets and liabilities at the date of the financial statementsand the reported amounts of revenues and expenses during the year Actual results could differ from those estimatesThe estimates and underlying assumptions are reviewed on an ongoing basis Revisions to accounting estimatesare recognised in the period in which the estimate is revised if the revision affects only that period they arerecognised in the period of the revision and future periods if the revision affects both current and future periods
All assets and liabilities have been classified as current or non-current as per the Companyrsquos normal operatingcycle and other criteria set out in the Schedule III to the Companies Act 2013 and Ind AS 1 ndash Presentation ofFinancial Statements based on the nature of business and the time between the acquisition of assets for processingand their realisation in cash and cash equivalents
Property Plant amp Equipment ndash Tangible AssetsProperty plant amp equipment are stated at cost of acquisition or construction less accumulated depreciation andimpairment if any For this purpose cost includes deemed cost which represents the carrying value of propertyplant and equipment recognised as at 1st April 2015 measured as per the previous GAAP
Cost is inclusive of inward freight duties and taxes and incidental expenses related to acquisition In respect ofmajor projects involving construction related pre-operational expenses form part of the value of assets capitalisedExpenses capitalised also include applicable borrowing costs for qualifying assets if any Subsequent costs areincluded in the assetrsquos carrying amount only when it meets the recognition criteria are met as per componentaccounting The carrying amount of a replaced part is derecognized All other repairs and maintenance are chargedto the statement of Profit amp Loss
An item of property plant and equipment is derecognized upon disposal or when no future economic benefits areexpected to arise from the continued use of asset Any gain or loss arising on the disposal or retirement of an itemof property plant and equipment is determined as the difference between the sales proceeds and the carryingamount of the asset and is recognised in Statement of Profit and Loss
Depreciation of these assets commences when the assets are ready for their intended use which is generally oncommissioning Items of Property Plant and Equipment are depreciated in a manner that depreciates the cost ofthe assets after commissioning (or other amount substituted for cost) less its residual value over their usefullives as specified in Schedule II of the Companies Act 2013 on a straight line basis
Property plant and equipmentrsquosrsquo residual values and useful lives are reviewed at each balance sheet date andchanges if any are treated as changes in accounting estimate
NOTES TO THE FINANCIAL STATEMENTS
45
NOTES TO THE FINANCIAL STATEMENTS
Useful lives of different class of PPE are as follows
Particulars Useful Life as per Schedule IIBuilding 60 Years
Plant and Equipment 15 Years
Furnitures and fixtures 8 years
Office equipment 5 Years
Impairment of AssetsImpairment loss is provided if any to the extent the carrying amount of assets or cash generating units exceedtheir recoverable amount
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amountmay not be recoverable
Recoverable amount is higher of an assetrsquos net selling price and its value in use Value in use is the present valueof estimated future cash flows expected to arise from the continuing use of an asset or cash generating unit andfrom its disposal at the end of its useful life
Impairment losses recognised in prior years are reversed when there is an indication that the impairment lossesrecognised no longer exist or have decreased Such reversals are recognised as an increase in carrying amountsof assets to the extent that it does not exceed the carrying amounts that would have been determined (net ofamortisation or depreciation) had no impairment loss been recognised in previous years
Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodiedin the asset are considered to modify the amortisation period or method as appropriate and are treated aschanges in accounting estimates
Financial instruments Financial Assets and Financial LiabilitiesFinancial assets and financial liabilities are recognized when the Company becomes a party to the contractualprovisions of the relevant instrument Transaction cost that are directly attributable to the acquisition or issue offinancial assets and financial liabilities (other than financial assets and financial liabilities measured at fair valuethrough profit or loss) are added to or deducted from the fair value on initial recognition of financial assets andfinancial liabilities Purchase or sale of financial assets that require delivery of assets within a time frame establishedby regulation or convention in the market place (regular way trades) are recognized on the trade date ie the datewhen the Company commits to purchase or sell the asset
Financial AssetsRecognition Financial assets includes Investments Trade receivable Advances Security Deposits Cash andcash equivalents Such Assets are initially recognized at transaction price when the company becomes party tocontractual obligations The transaction price includes transaction cost unless the assets is being fair valuedthrough the Statement of Profit and Loss
Classification Management determines the classification of an asset at initial recognition depending on thepurpose for which the assets were acquired The subsequent measurement of financial assets depends on suchclassification
Financial assets are classified as those measured at
(a) Amortised cost where the financial assets are held solely for collection of cash flows arising from payments ofprincipal and or interest
(b) Fair value through other comprehensive income (FVTOCI) where the financial assets are held not only forcollection of cash flows arising from payments of principal and interest but also from the sale of such assetsSuch assets are subsequently measured at fair value with unrealised gains and losses arising from changesin the fair value being recognised in other comprehensive income
46
NOTES TO THE FINANCIAL STATEMENTS
(c) Fair value through profit or loss (FVTPL) where the assets are managed in accordance with an approvedinvestment strategy that triggers purchase and sale decision based on fair value of such assets Such assetsare subsequently measured at fair value with unrealized gain and losses arising from changes in the fair valuebeing recognised in the Statement of Profit and Loss in the period in which they arise
Trade receivable Advances Security Deposits Cash and Cash equivalents etc are classified for measurementat amortised cost while Investment have been classified for measurement at Fair value through profit or loss(FVTPL)
Impairment The Company assesses at each reporting date whether a financial asset (or group of financialassets) such as investment trade receivable advances and security deposit held at amortised cost are tested forimpairment based on evidence or information that is available without undue cost or effort Expected credit lossesare assessed and loss allowances recognized if the credit quality of the financial asset has deteriorated significantlysince initial recognition
Reclassification When and only when the business model is changed the Company shall reclassify all affectedfinancial assets prospectively from the reclassification date as subsequently measured at amortised cost fairvalue through profit or loss without restating the previously recognized gains or losses and in terms of thereclassification principles laid down in the Ind AS relating to Financial Instruments
De-recognition Financial assets are derecognized when the rights to receive benefits have expired or beentransferred and the Company has transferred substantially all risks and rewards of ownership of such financialasset
Financial LiabilitiesTrade payables and other financial liabilities are initially recognized at the value of the respective contractualobligations They are subsequently measured at amortised cost
Financial liabilities are derecognized when the liability is extinguished that is when the contractual obligation isdischarged cancelled or expires
Offsetting Financial InstrumentsFinancial assets and liabilities are offset and the net amount is included in the Balance Sheet where there is alegally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis orrealise the asset and settle the liability simultaneously
Revenue1 Revenue is measured at the fair value of the consideration received or receivable for services rendered net of
discounts to customers and excludes taxes such as Goods and Services Tax Revenue from the sale ofservices is recognised when the Company performs its obligations to its customers and the amount of revenuecan be measured reliably and recovery of the consideration is probable Income from operating license fees arerecognized on accrual basis in accordance with Operating License agreement The timing of such revenuerecognition is in the periods in which such services are rendered
2 Interest Income is booked in the Statement of Profit and Loss using the effective interest method
3 Dividend Income is recognised in the Statement of Profit and Loss when the right to receive dividend is established
Employee BenefitsThe Company makes contributions to both defined benefit and defined contribution schemes
Contributions to Provident Fund are in the nature of defined contribution scheme and such paidpayable amountsare charged against revenue The contributions in respect of provident fund and family pension are statutorilydeposited with the Government
The Company also makes contribution to defined benefit gratuity plan The cost of providing benefits under thedefined benefit obligation is calculated by independent actuary using the projected unit credit method The Companyhas taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liability with respect to the
47
NOTES TO THE FINANCIAL STATEMENTS
employees and the premium paid to LIC is charged to Statement of Profit amp Loss The difference between theactuarial valuation of the gratuity with respect to employees at the year-end and the contribution paid to LIC isfurther adjusted in the books of accounts
Employees Benefit wrt Leave Encashment is considered as Employees Long Term Benefit for which the Companyrecords the liability based on actuarial valuation computed under projected unit credit method These benefits areunfunded
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee as per the Operating LicenseAgreement
Taxes on IncomeTaxes on income comprises of current tax and deferred tax Current tax in the Statement of Profit and Loss isprovided as the amount of tax payable in respect of taxable income for the period using tax rates and tax lawsenacted during the period together with any adjustment to tax payable in respect of previous years
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities andthe amounts used for taxation purposes (tax base) at the tax rates and tax laws enacted or substantively enactedby the end of the reporting period
Deferred tax assets are recognized for the future tax consequences to the extent it is probable that future taxableprofits will be available against which the deductible temporary differences can be utilized
Deferred tax assets and liabilities are offset when there is legally enforceable right to offset current tax assets andliabilities and when the deferred tax balances relate to the same taxation authority Current tax assets and taxliabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on netbasis or to realize the asset and settle the liability simultaneously
Dividend DistributionDividends paid (including income tax thereon) is recognised in the financial statements in the period in which inwhich the interim dividends are approved by the Board of Directors or in respect of the Companyrsquos final dividendfor the year when the same are approved by shareholders of the Company
Provisions and Contingent LiabilitiesProvisions are recognized when the Company has a present obligation (legal or constructive) as a result of a pastevent it is probable that an outflow of resources will be required to settle the obligation and the amount can bereliably estimated The amount so recognized is the best estimate of the consideration required to settle theobligation at the reporting date taking in to account the risks and uncertainties surrounding the obligation Adisclosure for a contingent liability is made when there is possible obligation or a present obligation that may butprobably will not require an outflow of resources Where there is possible obligation or a present obligation inrespect of which the likelihood of outflow of resources is remote no provision or disclosure is made
Use of Estimates and JudgementsThe key estimates and assumption used in the preparation of financial statements are set out below
Actuarial ValuationThe determination of Companyrsquos liability towards defined benefit obligation to employees is made through independentactuarial valuation including determination of amounts to be recognized in the Statement of Profit and Loss and inother comprehensive income Such valuation depend upon assumptions determined after taking into accountinflation seniority promotion and other relevant factors such as supply and demand factors in the employmentmarket Information about such valuation is provided in notes to the financial statements
ComparativesWhen required by Ind AS comparative figures have been adjusted to conform to changes in presentation for thecurrent financial year
48
2P
rope
rty
Pla
nt a
nd E
quip
men
tA
mou
nt i
n `
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
Gros
s Bl
ock
Depr
eciat
on
Amor
tisati
onNe
t Blo
ck
Parti
cula
rsWi
thdraw
alWi
thdraw
alWi
thdraw
alWi
thdraw
alAp
ril 1
and
Marc
h 31
an
dMa
rch
31
April
1Fo
r the
and
March
31
For t
hean
dMa
rch
31
Marc
h 31
Ma
rch
31
2017
Addi
tions
Adjus
tmen
t20
18Ad
ditio
nsAd
justm
ent
2019
2017
year
Adjus
tmen
t20
18ye
arAd
justm
ent
2019
2019
2018
Tang
ible
Ass
ets
Build
ing
161
88
565
-16
188
565
-2
668
831
592
168
29
561
564
759
84-1
432
140
473
636
290
5518
76
721
140
44
961
147
56
425
Plan
t and
Equ
ipmen
t7
637
0120
716
742
985
-2
047
935
381
92-
--
--
--
538
192
742
985
Furn
iture
and
Fixt
ures
1
278
845
584
122
300
-11
818
110
482
--
--
--
-1
104
821
223
00
Offic
e Eq
uipme
nt2
017
-2
017
--
201
7-
--
--
--
201
72
017
Tota
l1
708
216
7-
263
001
705
586
7-
483
494
165
72
373
956
156
475
984
-14
321
404
736
3629
055
187
672
11
469
565
21
562
372
7
Full
y de
prec
iated
ass
ets
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
49
NOTES TO THE FINANCIAL STATEMENTS
Amount in `Particulars As at 31st March 2019 As at 31st March 2018
Current Non-Current Current Non-Current3 OTHER ASSETS
Advances other than capital advancesSecurity Deposit- With Others 2328947 2328947- Statutory Authorities 200000Other Advances (prepaid expenses) 437564 ndash 406324 ndashAdvance Tax (Net of Provisions) 4143487 5280504TOTAL 437564 6672434 406324 7609451
4 Current investments (at fair value through profit or loss unless otherwise stated) Amount in `Sl Investments in Mutual Funds As at 31st March 2019 As at 31st March 2018No
Name of Plan Unquoted Unquoted1 DHFL Pramerica Ultra Short Term Fund Nil (2018 - 1040731248)
Units of ` 1000 each ndash 219455882 ICICI Prudential Banking amp PSU Debt Fund 1124750948 Units
(2018 - 1124750948) of ` 1000 each 23872614 224702743 ICICI Prudential Corporate Bond Fund 1241451718 Units
(2018 - 1241451718) of ` 1000 each 23712100 221226704 UTI Floating Rate Fund Short Term Fund 7749911 Units
(2018-7749911) of ` 100000 each 23474167 218899535 SBI Magnum Instacash Nil Units (2018-3177849) of ` 100000 each ndash 70220186 Aditya Birla Sun Life Floating Rate Fund-Long Term 274475933 Units
(2018-319824542) Units of ` 10000 each 63614941 686675207 Aditya Birla Sunlife Saving Fund 137924934 Units (2018-129174683)
Units of ` 10000 each 51171946 443649348 Kotak Savings Fund 1128273230 Units (2018-Nil) of ` 1000 each 33816154 ndash9 Reliance Liquid Fund 11416769 Units (2018- Nil) of ` 100000 each 51823115 ndash10 ICICI Prudential Liquid Fund 57413509 Units (2018- Nil) of ` 10000 each 8809857 ndash
Aggregate amount of unquoted Investments 280294894 208482957TOTAL 280294894 208482957
Amount in `As at As at
31st March 2019 31st March 20185 TRADE RECEIVABLES
Unsecured Considered Good 16310661 14154244TOTAL 16310661 14154244
6 CASH AND CASH EQUIVALENTS Balances with Banks
Current Accounts 760024 900355Cash on Hand 3015 ndashTOTAL 763039 900355 Cash and cash equivalents include cash on hand cheques drafts on hand cash at bank and deposits with banks with original maturityof 3 months or less
7 OTHER BANKS BALANCESEarmarked balances 5489856 5429140On Deposit Accounts ndash 47753491TOTAL 5489856 53182631
Represents deposits with original maturity of more than 3 months having remaining maturity of less than 12 months from the Balance Sheet date
50
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
8 OTHER FINANCIAL ASSETSInterest accrued on Deposits 158000 2210348Others - Unsecured considered good 4566316 4138776TOTAL 4724316 6349124
As at As at As at As at31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of ` (No of `
Shares) Shares)9 EQUITY SHARE CAPITAL
AuthorisedEquity Shares of ` 10- each 10000000 100000000 10000000 100000000Issued Subscribed and Paid upEquity Shares of ` 10- each fully paid 3787515 37875150 3787515 37875150
A) Reconciliation of the number of Equity Shares outstanding31st March 31st March
2019 2018As at the beginning of the year 3787515 3787515Add - Shares issued during the year ndash ndashLess -Shares bought back during the year ndash ndashAs at the end of the year 3787515 3787515
B) Shareholders holding more than 5 of the As at As at As at As atEquity Shares in the Company 31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of (No of
Shares) Shares)ITC Limited 1733907 4578 1733907 4578Russell Investments Limited 300056 792 300056 792
C) Rights Preferences and Restrictions attached to the Equity SharesThe Equity Shares of the Company having par value of ` 10 per share rank pari passu in all respects includingvoting rights and entitlement to dividend
D) There are no bonus issue or buy back of equity shares during the period of five years immediately preceding thereporting date
As at 31st March 2019 As at 31st March 2018Current Non-Current Current Non-Current
10 PROVISIONSProvision for Long Term Employee Benefits 74301 1399224 43165 1270990TOTAL 74301 1399224 43165 1270990
51
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
11 DEFERRED TAX LIABILITIES (NET)Deferred Tax Liabilities 10745247 11364002Total 10745247 11364002Movement in Deferred Tax LiabilitiesAssets Balances
For the year 2018-19 Balance as on Recognized in Balance as on1st April 2018 profit or loss 31st March 2019
Deferred Tax Liabilities in relation toOther timing differences
On Depreciation on PPE 4293876 (252926) 4040950On Gain on Investment at FVTPL 7070126 473819 7543945
Total Deferred Tax Liabilities 11364002 220893 11584895Deferred tax liabilities beforeMAT credit entitlement 11364002 220893 11584895Less MAT credit entitlement ndash 839648 839648Total Deferred Tax Liabilities (Net) 11364002 (618755) 10745247
For the year 2017-18 Balance as on Recognized in Balance as on1st April 2017 profit or loss 31st March 2018
Deferred Tax liabilitiesassets in relation toOther timing differences
On Depreciation on PPE 4383618 (89742) 4293876On Gain on Investment at FVTPL 4629882 2440244 7070126
Total Deferred Tax Liabilities (Net) 9013500 2350502 11364002
As at As at31st March 2019 31st March 2018
12 OTHER FINANCIAL LIABILITIES
Unpaid Dividend 5489856 5429140Employee Related 3782488 5688986TOTAL 9272344 11118126
13 OTHER CURRENT LIABILITIES
Statutory Liabilities 1264039 1172866TOTAL 1264039 1172866
52
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 201814 REVENUE FROM OPERATIONS
Operating License Fees 36986948 33098499TOTAL 36986948 33098499
15 OTHER INCOMEInterest Income- Deposit with Banks- Carried At Amortised Cost 1178600 3272160- Deposit Others 139222 181790Dividend Income on Investment measured at FVTPL 159984 178075Net Gain(Loss) on financial assets mandatorily measured at FVTPL 18005340 13358789Net Gain(Loss) on Disposal of Fixed Assets ndash 28273Other Non-Operating Income 142398 100022TOTAL 19625544 17119109
Includes 1120976- (2018 - 681882-) being net gain(loss) on sale of investments
16 EMPLOYEE BENEFITS EXPENSESalaries and Wages 42461991 38590070Contribution to Provident and Other Fund 4564892 3983444
47026883 42573514Less Recoveries madeReimbursements received (45818303) (41478905)TOTAL 1208580 1094609
17 OTHER EXPENSESAdvertising Sales Promotion 159768 158814Consultancy Professional fees 214842 253969Travelling amp Conveyance 810746 1096527Postage Telephone Stationery etc 366042 205049Miscellaneous Expenses 1556515 1619728TOTAL 3107913 3334087Miscellaneous expenses includes Auditors remuneration andexpenses Audit Fees 60000 60000Fees for other services 40000 ndash
18 INCOME TAX EXPENSESA Amount recognised in profit or loss
Current TaxIncome Tax for the Year 11504441 9481109Adjustments(Credits) related to previous year 149058 (208799)Total Current Tax 11653499 9272310Deferred TaxDeferred tax for the year 220893 2350502Mat Credit Entitlement (839648) ndashTotal Deferred Tax (618755) 2350502TOTAL 11034744 11622812
NOTES TO THE FINANCIAL STATEMENTSAmount in `
53
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 2018B Reconciliation of effective tax rate
Profit before tax 51822363 45312928Indian tax rate 2782 2755Income Tax expense calculated at 2782 (2018 2755) 14416981 12484845Effects ofndash Different tax rate on certain items (2922098) (756048)ndash Difference in taxable incomedeductible expense 9697 42609ndash Incomes that are not taxable in determining taxable profit (44508) (49064)Adjustments recognised in the current year in relation toCurrent tax of prior years (425328) (208799)Effect on deferred tax balances due to the change in income tax rate ndash 109269Income Tax recognised in profit or loss 11034744 11622812
The tax rate used for the year 2018-19 and 2017-18 reconciliations above is the corporate tax rate of 25 + surcharge 7 and education cess 4 (2017-18 3) payable on taxable profits under the Income Tax Act 1961
19 EARNINGS PER EQUITY SHAREProfit for the year 40787619 33690116Number of equity shares outstanding 3787515 3787515Basic and diluted earnings per share in (Face value ` 10- per share) 1077 890
20 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTSA The Company was allotted 8200 sq mtrs of land at Vadodara in 1984 and an additional land of 2548 sq mtrs
in 1988 at R C Dutt Road Alkapuri Vadodara through GIIC (Gujarat Industrial Investment Corporation) on sub-lease for a period 30 years on which the hotel Welcomhotel Vadodara was constructed Lease term of landadmeasuring 8200 Sq mtrs expired on 30092014 and of land admeasuring 2548 sq mtrs expired on 30112018
The High Court of Gujarat in pursuance of Writ petition filed by Company in April 2013 passed an Order onDecember 24 2014 restraining the State Government from disturbing the peaceful and actual possession ofthe Company over the hotel property in any manner The writ petition is pending for hearing
The Company have made necessary application to State Government for Conversion of land from Leasehold toFreehold or Extension of Lease which is in process
B There are no Micro Small and Medium Enterprises to whom the Company owes dues which are outstandingfor more than 45 days during the year and also as at 31st March 2019 This information as required to bedisclosed under the Micro Small and Medium Enterprises Development Act 2006 has been determined tothe extent such parties have been identified on the basis of information available with the Company
C The Company operates in one segment ie Hoteliering and within one geographical segment ie India
D Defined Benefit Plan
The Company has taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liabilitywith respect to the employees and the premium paid to LIC is charged to Statement of Profit amp Loss Thedifference between the actuarial valuation of the gratuity with respect to employees at the year-end and thecontribution paid to LIC is further adjusted in the books of accounts
The accounting charge for benefits under the defined benefit obligation is calculated by independent actuaryusing the projected unit credit method
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee (ITC Limited) as per theOperating License Agreement hence no effect on Statement of Profit amp Loss and Other Comprehensive
54
NOTES TO THE FINANCIAL STATEMENTS
Income
Risk ManagementThe defined Benefit Plan expose the company to risk of actuarial deficit arising out of investment risk interestrate risk and salary cost inflation riskInvestment Risks This may arise from volatility in asset values due to market fluctuations and impairment ofassets due to credit losses These Plans primarily invest in debt instruments such as Government securitiesand highly rated corporate bonds ndash the valuation of which is inversely proportional to the interest rate movementsInterest Rate Risk The present value of Defined Benefit Plans liability is determined using the discount ratebased on the market yields prevailing at the end of reporting period on Government bonds A decrease inyields will increase the fund liabilities and vice-versaSalary Cost Inflation Risk The present value of the Defined Benefit Plan liability is calculated with referenceto the future salaries of participants under the Plan Increase in salary due to adverse inflationary pressuresmight lead to higher liabilitiesThese Plans have a relatively balanced mix of investments in order to manage the above risks The investmentstrategy is designed based on the interest rate scenario liquidity needs of the Plans and pattern of investmentas prescribed under various statutes
(Amount in `) Particulars Gratuity 2018-19 2017-18
I Components of Defined Benefit Cost 31-03-2019 31-03-2018 Recognised in Profit or Loss a Current Service Cost 641829 519816 b Past Service Cost ndash
c Net Interest Cost (184109) (72060) Remeasurements a Effect of changes in demographic assumptions (2108) ndash b Effect of changes in financial assumptions ndash (546692) c Effect of experience adjustments (142950) (700483) d (Return) on plan assets (excluding interest income) 24103 110903 e Changes in asset ceiling (excluding interest income) ndash ndash f Total remeasurements included in OCI (169160) (1358078)
Total defined benefit cost recognized in PampL 288560 (910323)I I Net Assets (Liabilities) recognised in Balance Sheet 31-03-2019 31-03-2018
1 Defined Benefit Obligation at end of period 11112243 102978642 Fair value of plan assets at end of period 13058222 120087733 Net defined benefit liability (asset) (1945979) (1710909)
III Change in Defined Benefit Obligation 31-03-2019 31-03-20181 Defined benefit obligation at beginning of period 10297864 111006822 Current service cost 641829 5198163 Interest expenses 755904 7223694 Remeasurements gains (losses)
a Effect of changes in demographic assumptions (2108) ndashb Effect of changes in financial assumptions ndash (546692)c Effect of experience adjustments (142950) (700483)
5 Benefits Paid (438296) (797828)6 Present Value of DBO at end of the year 11112243 10297864
IV Change in Fair Value of Plan Assets 31-03-2019 31-03-20181 Fair value of plan assets at beginning of period 12008773 11529880
55
NOTES TO THE FINANCIAL STATEMENTS
2 Interest income 940012 7944303 Actual Company Contributions 523630 3713884 Benefits Paid (438296) (797828)5 Remeasurements Gains(Losses) on plan assets 24103 1109036 Fair Value of Plan Assets at end of period 13058222 12008773
V Significant Actuarial Assumptions 31-03-2019 31-03-20181 Discount rate () 750 7502 Salary increase rate 70 703 Attrition Rate 20 204 Retirement Age 58 585 Pre-retirement Mortality Indian Assured Indian Assured
Lives Mortality Lives Mortality(2012-14) Ultimate (2006-08) Ultimate
6 Disability Nil NilVI Sensitivity Analysis
The below sensitivity analysis are based on a change in an assumption while holding all other assumptionsconstant In practice this is unlikely to occur and changes in some of the assumptions may be correlatedWhen calculating the sensitivity of the defined benefit obligation to significant actuarial assumptionsthe same method (present value of the defined benefit obligation calculated with the projected unit creditmethod at the end of the reporting period) has been applied as when calculating the defined benefitliability recognised in the balance sheet The methods and types of assumptions used in preparing thesensitivity analysis did not change compared to the prior period
DBO as at DBO as at31-03-2019 31-03-2018
1 Discount rate +100 basis points 10484869 96707062 Discount rate -100 basis points 11804923 109908143 Salary Increase Rate +1 11746789 109364544 Salary Increase Rate -1 10525722 97077345 Attrition Rate +1 11127835 103179616 Attrition Rate -1 11095064 10276102
Maturity Analysis of the Benefit Payments 31-03-2019 31-03-2018 Year 1 804294 399061 Year 2 1117591 769443 Year 3 558914 1211853 Year 4 2204073 512504 Year 5 1303903 2056016 Next 5 years 4323660 4603103
E Amount towards Defined Contribution Plans have been recognized under Contribution to Provident and OtherFunds in Note 16 ` 4564892- (2018 - ` 3983444-)
F The financial statements were approved for issue by the Board of Directors on 15th April 2019G Company has adopted IND As 115 lsquoRevenue from Contracts with Customersrsquo wef 01st April 2018 on prospective
basis and there is no material impact on Financial StatementsH Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Second
Amendment Rules 2019 on 30th March 2019 notifying new Standard Ind AS 116 lsquoLeasesrsquo and otherconsequential amendment in existing Ind As This Ind AS is applicable for annual period beginning on or after01st April 2019 The company is in the process of analysing the impact of such amendment which are notexpected to be material
56
NOTES TO THE FINANCIAL STATEMENTS
21 Financial Instruments and Related DisclosuresI Capital Management
The Company does not have borrowing and aims at maintaining a strong capital base so as to maintain adequatesupply of funds towards future growth plans as a going concern
II Categories of Financial InstrumentsAmount in `
Particulars Note As at As at March 31 2019 March 31 2018
Carrying Fair Carrying FairValue Value Value Value
A Financial Assetsa) Measured at Amortised Cost
i) Cash and cash equivalents 6 763039 763039 900355 900355ii) Other bank balances 7 5489856 5489856 53182631 53182631iii) Trade Receivables 5 16310661 16310661 14154244 14154244iv) Other Financial Assets 8 4724316 4724316 6349124 6349124
Sub - total 27287872 27287872 74586354 74586354 b) Measured at Fair Value through Profit or Loss
i) Investment in mutual funds 4 280294894 280294894 208482957 208482957Sub - total 280294894 280294894 208482957 208482957
Total Financial Assets 307582766 307582766 283069311 283069311B Financial Liabilities
Measured at Amortised Costi) Trade Payables 483074 483074 395920 395920ii) Other Financial Liabilities 12 9272344 9272344 11118126 11118126Total Financial Liabilities 9755418 9755418 11514046 11514046
The carrying amounts of trade payables other financial liabilities cash and cash equivalents other bank balancestrade receivables and other financial assets are considered to be the same as their fair values due to their short termnatureFair value in Mutual fund has been considered as Level 1 as Hierarchy for the same are based on unadjusted pricesin active marketIII Financial Risk Management Objectives
The Company has a system-based approach to risk management anchored to policies and procedures andinternal financial controls aimed at ensuring early identification evaluation and management of key financialrisks (such as market risk credit risk and liquidity risk) that may arise as a consequence of its businessoperations as well as its investing activities Accordingly the Companyrsquos risk management framework has theobjective of ensuring that such risks are managed within acceptable and approved risk parameters in a disciplinedand consistent manner and in compliance with applicable regulation It also seeks to drive accountability in thisregardLiquidity RiskThe company has current assets aggregate to ` 308020330- (2018- ` 283475635) including CurrentInvestments Cash and cash equivalents and Other bank balances of ` 286547789- (2018- ` 262565943-)against an aggregate Current liability of ` 11093758- (2018- ` 12730077-) on the reporting dateFurther whilethe Companyrsquos total equity stands at ` 306150187- (2018- ` 281343744-) and it has no borrowings In suchcircumstances liquidity risk or the risk that the company may not be able to settle or meet its obligations as theybecome due does not existMarket RiskThe company invests in mutual fund schemes of leading fund houses Such investments are susceptible tomarket price risk that arise mainly from changes in interest rate which may impact the return and value of such
57
NOTES TO THE FINANCIAL STATEMENTS
investments However given the relatively short tenure of the underlying portfolio of the mutual fund schemes inwhich the company has invested such price risk is not significantCredit RiskCompanyrsquos deployment in financial instruments such as mutual funds and fixed deposit are made in high qualitypaperscounterparties The company has receivable balances with ITC Limited under the Operating ServiceAgreement which are generally short term in nature Accordingly the Company has concluded that no provisionfor expected credit loss is required
22 Related Party DisclosuresRelated Party Transactionsi) Name of related parties and nature of relationships
ITC Limited of which the Company is an Associateii) Key Management Personnel
Board of DirectorsN Anand Chairman amp Non-Executive DirectorJ Singh Non-Executive DirectorR C Mehta Non-Executive DirectorC K Koshy Non-Executive DirectorM Narayanan Non-Executive DirectorD R Choudhury Non-Executive Director
iii) Summary of transactions during the year Amount in `
Particulars ITC Limited Key ManagementPersonnel
2019 2018 2019 2018License Fees Received 43644599 38834172 ndash ndashPurchase of Services 364514 513635 ndash ndashRemuneration of Managers on Deputation Reimbursed 5916468 5236397 ndash ndashRecoveries of Contractual Remuneration(Including Mangers on Deputation) 53058539 51502148 ndash ndashExpenses Recovered 2168155 2400471 ndash ndashExpenses Reimbursed ndash 44604 ndash ndashDividend Payments 6068675 6068675 700 700Remuneration to Key Management Personnel- Directorrsquos Sitting Fees 370000 350000Balance amount recoverable 20865894 18292750 ndash ndashBalance amount payable ndash ndash ndash ndash
58
TO THE MEMBERS OFGUJARAT HOTELS LIMITED
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying financial statementsof Gujarat Hotels Limited (ldquothe Companyrdquo) which comprisethe Balance Sheet as at 31st March 2019 the Statement ofProfit and Loss including other comprehensive incomeStatement of Changes in Equity and Statement of CashFlows for the year then ended and notes to the financialstatements including a summary of significant accountingpolicies and other explanatory information (hereinafterreferred to as ldquothe financial statementsrdquo)
In our opinion and to the best of our information andaccording to the explanations given to us the aforesaidfinancial statements give the information required by theCompanies Act 2013 (ldquothe Actrdquo) in the manner so requiredand give a true and fair view in conformity with the IndianAccounting Standards specified under section 133 of theAct read with the Companies (Indian Accounting Standards)Rules 2015 as amended (lsquoInd ASrdquo) and other accountingprinciples generally accepted in India of the state of affairsof the Company as at 31 st March 2019 and totalcomprehensive income (comprising of profit and othercomprehensive income) changes in equity and its cashflows for the year ended on that date
Basis for Opinion
We conducted our audit of the financial statements inaccordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act Our responsibilities underthose Standards are further described in the AuditorrsquosResponsibilities for the Audit of the Financial Statementssection of our report We are independent of the Companyin accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financialstatements under the provisions of the Act and the Rulesmade thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements andthe Code of Ethics We believe that the audit evidence wehave obtained is sufficient and appropriate to provide abasis for our audit opinion
Key Audit Matters
Key audit matters are those matters that in our professionaljudgment were of most significance in our audit of thesefinancial statements of the current period These matterswere addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereonand we do not provide a separate opinion on these mattersWe have determined the matters described below to bethe key audit matters to be communicated in our report
INDEPENDENT AUDITORS REPORT
Information Other than the Financial Statements andAuditorrsquos Report Thereon
The Companyrsquos Board of Directors is responsible forpreparation of the other information The other informationcomprises the information included in the Boardrsquos Reportincluding Annexures to Boardrsquos Report ManagementDiscussion and Analysis Report on Corporate Governance
and Shareholderrsquos Information but does not include thefinancial statements and our auditorrsquos report thereon
Our opinion on the financial statements does not cover theother information and we do not express any form ofassurance conclusion thereon
In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing
Sr No
Key Audit Matter How our audit addressed the matter
1 Evaluation of uncertain legal position of leasehold land
(Refer note no 20A to the financial statements)
The lease period of land held by the Company has expired The Company has filed necessary writ petition with High Court of Gujarat in April 2013 which is still pending for adjudication The Company has also made necessary application to State Government for Conversion of land from Leasehold to Freehold or Extension of Lease which is in process This matter being sub-judice essentially involves significant judgement to determine the possible outcome and therefore we have considered it as a key audit matter
We performed the following substantive procedures
Obtained details of application made to State Government Obtained details of writ petition filed to the High Court of
Gujarat and order copy passed by the High Court of Gujarat restraining the State Government from disturbing the actual possession over the property
Obtained details of progress in the matter Discussed the case with the Companyrsquos legal advisor about
the possible outcomes Read the minutes of the board meetings
Based on the procedures described managementrsquos evaluation on the same is acceptable
59
so consider whether the other information is materiallyinconsistent with the financial statements or our knowledgeobtained in the audit or otherwise appears to be materiallymisstated
If based on the work we have performed we conclude thatthere is a material misstatement of this other informationwe are required to report that fact We have nothing to reportin this regard
Responsibilities of Management and Those Charged withGovernance for the Financial Statements
The Companyrsquos Board of Directors is responsible for thematters stated in section 134(5) of the Act with respect tothe preparation of these financial statements that give atrue and fair view of the financial position financialperformance including other comprehensive incomechanges in equity and cash flows of the Company inaccordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards(Ind AS) prescribed under section 133 of the Act
This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company andfor preventing and detecting frauds and other irregularitiesselection and application of appropriate accounting policies making judgments and estimates that are reasonableand prudent and design implementation andmaintenance of adequate internal financial controls thatwere operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to thepreparation and presentation of the financial statementsthat give a true and fair view and are free from materialmisstatement whether due to fraud or error
In preparing the financial statements management isresponsible for assessing the Companyrsquos ability tocontinue as a going concern disclosing as applicablematters related to going concern and using the goingconcern basis of accounting unless management eitherintends to liquidate the Company or to cease operationsor has no realistic alternative but to do so
The Board of Directors is also responsible for overseeingthe Companyrsquos financial reporting process
Auditorrsquos Responsibilities for the Audit of the FinancialStatements
Our objectives are to obtain reasonable assurance aboutwhether the financial statements as a whole are free frommaterial misstatement whether due to fraud or error andto issue an auditorrsquos report that includes our opinionReasonable assurance is a high level of assurance but isnot a guarantee that an audit conducted in accordance withSAs will always detect a material misstatement when itexists Misstatements can arise from fraud or error and areconsidered material if individually or in the aggregate they
could reasonably be expected to influence the economicdecisions of users taken on the basis of these financialstatements
As part of an audit in accordance with SAs we exerciseprofessional judgment and maintain professionalskepticism throughout the audit We also
bull Identify and assess the risks of materialmisstatement of the financial statements whetherdue to fraud or error design and perform auditprocedures responsive to those risks and obtain auditevidence that is sufficient and appropriate to providea basis for our opinion The risk of not detecting amaterial misstatement resulting from fraud is higherthan for one resulting from error as fraud may involvecollusion forgery intentional omissionsmisrepresentations or the override of internal control
bull Obtain an understanding of internal control relevantto the audit in order to design audit procedures thatare appropriate in the circumstances Under section143(3)(i) of the Act we are also responsible forexpressing our opinion on whether the Company hasadequate internal financial controls system in placeand the operating effectiveness of such controls
bull Evaluate the appropriateness of accounting policiesused and the reasonableness of accountingestimates and related disclosures made bymanagement
bull Conclude on the appropriateness of managementrsquosuse of the going concern basis of accounting andbased on the audit evidence obtained whether amaterial uncertainty exists related to events orconditions that may cast significant doubt on theCompanyrsquos ability to continue as a going concern Ifwe conclude that a material uncertainty exists we arerequired to draw attention in our auditorrsquos report tothe related disclosures in the financial statementsor if such disclosures are inadequate to modify ouropinion Our conclusions are based on the auditevidence obtained up to the date of our auditorrsquosreport However future events or conditions maycause the Company to cease to continue as a goingconcern
bull Evaluate the overall presentation structure andcontent of the financial statements including thedisclosures and whether the financial statementsrepresent the underlying transactions and events ina manner that achieves fair presentation
We communicate with those charged with governanceregarding among other matters the planned scope andtiming of the audit and significant audit findings includingany significant deficiencies in internal control that weidentify during our audit
INDEPENDENT AUDITORS REPORT
60
We also provide those charged with governance with astatement that we have complied with relevant ethicalrequirements regarding independence and tocommunicate with them all relationships and other mattersthat may reasonably be thought to bear on ourindependence and where applicable related safeguards
From the matters communicated with those charged withgovernance we determine those matters that were of mostsignificance in the audit of the financial statements of thecurrent year and are therefore the key audit matters Wedescribe these matters in our auditorrsquos report unless lawor regulation precludes public disclosure about the mattersor when in extremely rare circumstances we determinethat a matters should not be communicated in our reportbecause the adverse consequences of doing so wouldreasonably be expected to outweigh the public interestbenefits of such communication
Report on Other Legal and Regulatory Requirements
1 As required by the Companies (Auditorrsquos Report)Order 2016 (ldquothe Orderrdquo) issued by the CentralGovernment of India in terms of sub-section (11) ofsection 143 of the Act we give in ldquoAnnexure Ardquo astatement on the matters specified in paragraphs 3and 4 of the Order to the extent applicable
2 As required by Section 143(3) of the Act we reportthat
a we have sought and obtained all the information andexplanations which to the best of our knowledge andbelief were necessary for the purposes of our audit
b in our opinion proper books of account as requiredby law have been kept by the Company so far as itappears from our examination of those books
c the Balance Sheet the Statement of Profit and lossincluding other comprehensive income the Statementof Changes in Equity and the Statement of Cash Flowsdealt with by this Report are in agreement with thebooks of account
d in our opinion the aforesaid financial statementscomply with the Indian Accounting Standards (Ind AS)prescribed under Section 133 of the Act
e on the basis of the written representations receivedfrom the directors as on 31st March 2019 taken onrecord by the Board of Directors none of the directorsis disqualified as on 31st March 2019 from beingappointed as a director in terms of Section 164(2) ofthe Act
f with respect to the adequacy of the internal financialcontrols with reference to financial statements of theCompany and the operating effectiveness of suchcontrols refer to our separate report in ldquoAnnexure Brdquoand
g with respect to the other matters to be included in theAuditorrsquos Report in accordance with the requirementsof section 197(16) of the Act as amended theCompany has neither paid nor provided for anyremuneration to its directors during the year
h with respect to the other matters to be included in theAuditorrsquos Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules 2014 in ouropinion and to the best of our information andaccording to the explanations given to us
i the Company does not have any pendinglitigations which would impact its financialposition
ii the Company did not have any long-termcontracts including derivative contracts for whichthere were any material foreseeable losses
iii there has been no delay in transferringamounts required to be transferred to theInvestor Education and Protection Fund by theCompany
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
61
ANNEXURE A TO THE INDEPENDENT AUDITORrsquoS REPORT
The annexure referred to in our Independent AuditorrsquosReport to the members of Gujarat Hotels Limited (ldquotheCompanyrdquo) on the financial statements for the year ended31st March 2019 we report that
i (a) The Company has maintained proper recordsshowing full particulars including quantitativedetails and situation of fixed assets
(b) As explained to us the Company has a regularprogram of physical verification of fixed assetswhich in our opinion is reasonable The assetswhich were to be covered as per the saidprogram have been physically verified by themanagement during the year In our opinion andAccording to the information and explanationsgiven to us no material discrepancies werenoticed on such verification
(c) According to the information and explanationsgiven to us and on the basis of our examinationof the records of the Company the title deeds ofimmovable properties are held in the name ofthe Company with respect to land the Companyhas filed a writ petition with Gujarat High Courtseeking that the Gujarat State Government bedirected to take action on Companyrsquosapplication to have the leasehold land of theHotel Converted to freehold and transferred toCompany as per the existing government policyin this regard
ii The Company does not have any inventory andtherefore reporting under clause (ii) of the Order isnot applicable to the Company
iii The Company has not granted any loans secured orunsecured to Companies firms Limited LiabilityPartnerships or other parties covered in the registermaintained under section 189 of the Companies Act2013 and therefore reporting under clause (iii) of theOrder is not applicable to the Company
iv The Company has not given any loans guaranteesor security In respect of the Investments made in ouropinion and according to the information andexplanations given to us the Company has compliedwith the provisions of section 186 of the Act
v According to the information and explanations givento us the Company has not accepted any depositsduring the year from the public within the meaning ofprovisions of section 73 to 76 of the Companies Act2013 and the rules framed thereunder and thereforereporting under clause (v) of the Order is notapplicable to the Company
vi In our opinion and according to the information andexplanations given to us in view of Rule 3 of theCompanies (Cost Records and Audit) AmendmentsRules 2014 the maintenance of cost records undersub-section (1) of section 148 of the Companies Act2013 is not applicable to the Company and thereforereporting under clause (vi) of the Order is notapplicable to the Company
vii (a) According to the information and explanationsgiven to us the Company has been regular indepositing with appropriate authoritiesundisputed statutory dues including providentfund employeersquos state insurance income-taxvalue added tax goods and service tax cessand other statutory dues applicable to it Furtherno undisputed amounts payable in respect ofprovident fund employeersquos state insuranceincome tax value added tax goods and servicetax cess and any other statutory dues were inarrears as at 31st March 2019 for a period ofmore than six months from the date theybecome payable
(b) According to the information and explanationsgiven to us there are no dues of Income taxsales tax value added tax and goods andservice tax which have not been deposited onaccount of any dispute
viii The Company has not taken any loans or borrowingsfrom financial institutions banks and government orhas not issued any debentures and thereforereporting under clause (viii) of the Order is notapplicable to the Company
ix The Company has not raised moneys by way of initialpublic offer or further public offer (including debtinstrument) and term loans during the year andtherefore reporting under clause (ix) of the Order isnot applicable to the Company
x To the best of our knowledge and according toinformation and explanations given to us no materialfraud by the Company or on the Company by its officersor employees has been noticed or reported duringthe course of our audit
xi In our opinion and according to the information andexplanations given to us the Company has not paidor provided any managerial remuneration during theyear and therefore reporting under clause (xi) of theOrder is not applicable to the Company
xii The Company is not a Nidhi company and thereforereporting under clause (xii) of the Order is notapplicable to the Company
INDEPENDENT AUDITORS REPORT
62
xiii In our opinion and according to the information andexplanations given to us and based on ourexamination of the records of the Company alltransactions with the related parties are in compliancewith Section 177 and 188 of the Act where applicableand the details have been disclosed in the financialstatements as required by the applicable accountingstandards
xiv According to the information and explanations givento us the Company has not made any preferentialallotment or private placement of shares or fully orpartly convertible debentures during the year underreview and therefore reporting under clause (xiv) ofthe Order is not applicable to the Company
xv In our opinion and according to the information andexplanations given to us the Company has not
entered into any non-cash transactions with directorsor persons connected with directors and thereforereporting under clause (xv) of the Order is notapplicable to the Company
xvi The Company is not required to be registered undersection 45-IA of the Reserve Bank of India Act 1934
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
63
ANNEXURE ldquoBrdquo TO THE INDEPENDENT AUDITORSrsquo REPORT
(Referred to in paragraph 2(f) under lsquoReport on Other Legaland Regulatory Requirementsrsquo section of our report to theMembers of Gujarat Hotels Limited on the financialstatements of even date)
Report on the Internal Financial Controls with referenceto financial statements under Clause (i) of Sub-section 3of Section 143 of the Act
W e have audited the internal financial controls withreference to financial statements of Gujarat Hotels Limited(ldquothe Companyrdquo) as of 31st March 2019 in conjunction withour audit of the financial statements of the Company for theyear ended on that date
Managementrsquos Responsibility for Internal FinancialControls
The Companyrsquos management is responsible forestablishing and maintaining internal financial controlsbased on the internal control over financial reporting criteriaestablished by the Company considering the essentialcomponents of internal control stated in the Guidance Noteon Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountantsof India (ldquoICAIrdquo) These responsibilities include the designimplementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuringthe orderly and efficient conduct of its business includingadherence to companyrsquos policies the safeguarding of itsassets the prevention and detection of frauds and errorsthe accuracy and completeness of the accounting recordsand the timely preparation of reliable financial informationas required under the Act
Auditorsrsquo Responsibility
Our responsibility is to express an opinion on theCompanyrsquos internal financial controls with reference tofinancial statements based on our audit We conductedour audit in accordance with the Guidance Note on Audit ofInternal Financial Controls over Financial Reporting (theldquoGuidance noterdquo) and the Standards on Auditing issued byICAI and deemed to be prescribed under section 143(10)of the Companies Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the ICAIThose Standards and the Guidance Note require that wecomply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whetheradequate internal financial controls with reference tofinancial statements were established and maintained andif such controls operated effectively in all material respects
Our audit involves performing procedures to obtain auditevidence about the adequacy of the internal financialcontrols with reference to financial statements and their
operating effectiveness Our audit of internal financialcontrols with reference to financial statements includedobtaining an understanding of internal financial controlswith reference to financial statements assessing the riskthat a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal controlbased on the assessed risk The procedures selecteddepend on the auditorrsquos judgement including theassessment of the risks of material misstatement of thefinancial statements whether due to fraud or error
We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our auditopinion on the Companyrsquos internal financial controls withreference to financial statements
Meaning of Internal Financial Controls with reference tofinancial statements
A Companyrsquos internal financial controls with reference tofinancial statements is a process designed to providereasonable assurance regarding the reliability of financialreporting and the preparation of financial statements forexternal purposes in accordance with generally acceptedaccounting principles A Companyrsquos internal financialcontrols with reference to financial statements includesthose policies and procedures that (1) pertain to themaintenance of records that in reasonable detailaccurately and fairly reflect the transactions anddispositions of the assets of the Company (2) providereasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements inaccordance with generally accepted accounting principlesand that receipts and expenditures of the Company arebeing made only in accordance with authorisations ofmanagement and directors of the Company and (3) providereasonable assurance regarding prevention or timelydetection of unauthorised acquisition use or dispositionof the Companyrsquos assets that could have a material effecton the financial statements
Inherent Limitations of Internal Financial Controls withreference to financial statements
Because of the inherent limitations of internal financialcontrols with reference to financial statements includingthe possibility of collusion or improper managementoverride of controls material misstatements due to erroror fraud may occur and not be detected Also projections ofany evaluation of the internal financial controls withreference to financial statements to future periods aresubject to the risk that the internal financial control withreference to financial statements may become inadequatebecause of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate
INDEPENDENT AUDITORS REPORT
64
Opinion
In our opinion the Company has in all material respectsan adequate internal financial controls with reference tofinancial statements and such internal financial controlswith reference to financial statements were operatingeffectively as at 31st March 2019 based on the internalcontrol over financial reporting criteria established by theCompany considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal
INDEPENDENT AUDITORS REPORT
Financial Controls over Financial Reporting issued by theInstitute of Chartered Accountants of India
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
REPORT AND ACCOUNTS 2019
1
Board of Directors amp Committees 2
Notice of Annual General Meeting 3
Your Directors 9
Report on Corporate Governance 11
Shareholder Information 17
Report of the Board of Directors amp Management 20Discussion and Analysis
CEO and CFO Compliance Certificate 39
Balance Sheet 40
Statement of Profit and Loss 41
Statement of changes in equity 42
Cash Flow Statement 43
Notes to the Financial Statements 44
Independent Auditors Report 58
Board of DirectorsCONTENTS
2
BOARD OF DIRECTORS amp COMMITTEES
Board Committees
Chairman and Non-Executive Director
Nakul Anand
Non-Executive Directors
Mohan Swarup Bhatnagar
Devkanya Roy Choudhury
Cheruvettolil Kochukoshy Koshy
Mahalinga Narayanan
Jagdish Singh
M Narayanan Chairman C K Koshy Chairman J Singh Chairman
C K Koshy Member N Anand Member D R Choudhury Member
J Singh Member M Narayanan Member C K Koshy Member
M Agarwal Invitee J Singh Member
K Pahwa Invitee
Representative of InviteeStatutory Auditors
Audit Committee Nominations andRemuneration Committee
StakeholdersRelationship Committee
Key Managerial Personnel
Board of Directors
Registered Office Statutory Auditors Registrar and Share Transfer AgentsWelcomHotel Vadodara K C Mehta amp Co MCS Share Transfer Agent LimitedR C Dutt Road Alkapuri Chartered Accountants F-651st FloorVadodara - 390 007 Vadodara Okhla Industrial Area Phase - 1Tel 0265-233 0033 New Delhi 110 020CIN L55100GJ1982PLC005408 Tel 011-4140 6149-52 4160 9386Website wwwgujarathotelsltdinE-mail ghlinvestorsyahoocoin
Chief Executive Officer - Kunal Pahwa Chief Financial Officer - Mayur Agarwal
3
NOTICE IS HEREBY GIVEN that the Thirty Seventh AnnualGeneral Meeting of the Members of Gujarat Hotels Limitedwill be held at the Registered Office of the Company atWelcomHotel Vadodara R C Dutt Road Alkapuri Vadodarandash 390 007 on Saturday the 7th day of September 2019 at1100 am for the transaction of the following businesses-
ORDINARY BUSINESS
1 To consider and adopt the Financial Statements of theCompany for the financial year ended 31st March2019 and the Reports of the Board of Directors andthe Auditors
2 To declare dividend for the financial year ended31st March 2019
3 To appoint a Director in place of Mr Jagdish Singh(DIN 00042258) who retires by rotation and beingeligible offers himself for re-election
4 To consider and if thought fit to pass the followingresolution as an Ordinary Resolution-
ldquoResolved that in accordance with the provisions ofSection 142 of the Companies Act 2013 payment ofremuneration of ` 60000- (Rupees Sixty Thousandonly) to Messrs K C Mehta amp Co CharteredAccountants (FRN 106237W) to conduct the audit forthe financial year 2019-20 plus goods and servicestax as applicable and reimbursement of out-of-pocketexpenses incurred be and is hereby approvedrdquo
SPECIAL BUSINESS
5 To consider and if thought fit to pass the followingresolution as an Ordinary Resolution-
ldquoResolved that in accordance with the provisions ofSection 149 read with Schedule IV of the CompaniesAct 2013 and Regulation 17 of the Securities andExchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 thisMeeting hereby approves the appointment ofMr Mohan Swarup Bhatnagar (DIN 00834857) as anIndependent Director of the Company for a period offive years with effect from 28th June 2019 or till suchearlier date as may be determined by any applicablestatutes rules regulations or guidelinesrdquo
6 To consider and if thought fit to pass the followingresolution as a Special Resolution-
ldquoResolved that in accordance with the provisions ofSection 149 read with Schedule IV of the Companies
GUJARAT HOTELS LIMITEDCIN L55100GJ1982PLC005408
Registered Office WelcomHotel Vadodara R C Dutt Road Alkapuri Vadodara-390 007Tel +91 0265 233 0033 E-mail ghlinvestorsyahoocoin Website wwwgujarathotelsltdin
NOTICE OF 37TH ANNUAL GENERAL MEETING
AGM NOTICE
Act 2013 and Regulation 17 of the Securities andExchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 thisMeeting hereby approves the re-appointment ofMr Cheruvettolil Kochukoshy Koshy (DIN 01478704)as an Independent Director of the Company for aperiod of five years with effect from 29th September2019 or till such earlier date as may be determinedby any applicable statutes rules regulations orguidelinesrdquo
7 To consider and if thought fit to pass the followingresolution as a Special Resolution-
ldquoResolved that in accordance with the provisions ofSection 149 read with Schedule IV of the CompaniesAct 2013 and Regulation 17 of the Securities andExchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 thisMeeting hereby approves the re-appointment ofMr Mahalinga Narayanan (DIN 00159288) as anIndependent Director of the Company for a period offive years with effect from 29th September 2019 or tillsuch earlier date as may be determined by anyapplicable statutes rules regulations or guidelinesrdquo
The Register of Members of the Company will remainclosed from Friday 30th August 2019 to Saturday7th September 2019 both days inclusive ShareTransfers received in order at the Companyrsquos Registrarand Share Transfer Agents Messrs MCS ShareTransfer Agent Limited F-65 1st Floor Okhla IndustrialArea Phase - I New Delhi - 110 020 by 530 pm onThursday 29th August 2019 will be processed forpayment of dividend if declared to the transferees orto their mandatees and the dividend if declared willbe paid on Friday 13th September 2019 to thoseMembers entitled thereto and whose names willappear in the Register of Members of the Companyon 7th September 2019 or to their mandatees subjecthowever to the provisions of Section 126 of theCompanies Act 2013 In respect of dematerialisedshares the dividend will be paid on the basis ofbeneficial ownership as on 29th August 2019 as perdetails to be furnished by National SecuritiesDepository Limited (NSDL) and Central DepositoryServices (India) Limited (CDSL) for this purpose
By Order of the BoardGujarat Hotels Limited
Place New Delhi Jagdish SinghDate 15th July 2019 Director
4
NOTES
1 A Member entitled to attend and vote at the AnnualGeneral Meeting (lsquoAGMrsquo) may appoint a proxy toattend and vote on his behalf A proxy need not be aMember of the Company
Proxies in order to be effective must be received atthe Registered Office of the Company not less thanforty-eight hours before the commencement of the AGMie by 1100 am on 5th September 2019
Corporate Members are required to send to theRegistered Office of the Company a certified copy ofthe Board Resolution pursuant to Section 113 of theCompanies Act 2013 (lsquothe Actrsquo) authorising theirrepresentatives to attend and vote at the AGM
2 Explanatory Statement pursuant to Section 102 of theAct relating to the Special Business to be transactedat this AGM is annexed
3 Route map of the AGM venue pursuant to theSecretarial Standard on General Meetings is alsoannexed
4 In terms of Section 108 of the Act read with Rule 20 ofthe Companies (Management and Administration)Rules 2014 the Resolutions for consideration at thisAGM will be transacted through remote e-voting (facilityto cast vote from a place other than the venue of theAGM) for which purpose the Board of Directors of theCompany (lsquothe Boardrsquo) have engaged the services ofCDSL
The facility for voting through ballot paper will beavailable at the AGM venue for those Members who donot cast their votes by remote e-voting prior to the AGMMembers who cast their votes by remote e-voting mayattend the Meeting but will not be entitled to cast theirvotes once again The Board has appointedMr Suresh Kabra (ACS 9711) Partner Messrs SamdaniKabra amp Associates Company Secretaries as theScrutinizer to scrutinize the process of remote e-votingand voting through ballot paper at the AGM venue
5 Voting rights will be reckoned on the paid-up value ofshares registered in the name of the Members on31st August 2019 (cut-off date) Only those Memberswhose names are recorded in the Register ofMembers of the Company or in the Register ofBeneficial Owners maintained by the Depositories ason the cut-off date will be entitled to cast their votes byremote e-voting or voting through ballot paper at theAGM venue A person who is not a Member on thecut-off date should accordingly treat this Notice as forinformation purposes only
6 Unclaimed dividend for the financial year ended31st March 2012 and the corresponding Equity Sharesof the Company in respect of which dividend
entitlements remain unclaimed for seven consecutiveyears will be due for transfer to the Investor Educationand Protection Fund of the Central Government on14th September 2019 pursuant to the provisions ofSection 124 of the Act read with the Investor Educationand Protection Fund Authority (Accounting AuditTransfer and Refund) Rules 2016 Members arerequested to claim the said dividend details of whichare available on the Companyrsquos websitewwwgujarathotelsltdin under the section lsquoGeneralInformationrsquo under lsquoShareholder Valuersquo The Companywill not be able to entertain any claim received after12th September 2019 in respect of the same
7 Members may visit the Companyrsquos website to viewthe Financial Statements or access informationpertaining to the Company Queries if any should besent at least 10 days before the AGM to theChief Financial Officer at the Registered Office of theCompany
8 Members are required to bring their admission slipsto the AGM Duplicate admission slips or copies of theReport and Accounts will not be made available at theAGM venue
9 The procedure with respect to remote e-voting isprovided below
I The period for remote e-voting begins onTuesday 3rd September 2019 at 900 am andends on Friday 6th September 2019 at 500 pmDuring this period Members of the Companyholding shares either in certificate form or indematerialised form as on the cut-off date ie31st August 2019 may cast their voteselectronically The e-voting module shall bedisabled by CDSL for voting thereafter
II The Members should log on to the e-votingwebsite wwwevotingindiacom
III Click on lsquoShareholders MembersrsquoIV Now enter your user ID as under
bull For CDSL 16 digits beneficiary ID
bull For NSDL 8 character DP ID followed by 8digits Client ID
bull Members holding shares in certificate formshould enter Folio Number registered withthe Company
V Thereafter enter the image verification code asdisplayed and Click on lsquoLoginrsquo
VI If you are holding shares in dematerialised formand had logged on to wwwevotingindiacom andcasted your vote earlier for any company thenyour existing password is to be used If you have
5
forgotten the password then enter user ID andthe image verification code and click on forgotpassword amp enter the details as prompted by thesystem
VII If you are a first time user please follow the stepsgiven below
For Members holding shares either in dematerialisedform or in certificate form
PAN Enter your 10 digit alpha-numeric PAN issuedby Income Tax Departmentbull Members who have not updated their
PAN with the Company DepositoryParticipant are requested to use the firsttwo letters of their name and the 8 digitsof the sequence number in the PAN field
bull In case the sequence number is lessthan 8 digits enter the applicable numberof 0rsquos before the number after the firsttwo characters of the name in CAPITALletters Eg If your name is RameshKumar with sequence number I thenenter RA00000001 in the PAN field
Dividend Enter the Dividend Bank Details or Date ofBank Birth (in ddmmyyyy format) as recorded inDetails your demat account or in the CompanyOR records in order to loginDate of bull If both the details are not recorded withBirth the Depository or the Company please
enter your member ID folio number inthe Dividend Bank details field asmentioned in instruction IV
VIII After entering these details appropriately click onlsquoSubmitrsquo
IX Members holding shares in certificate form willthen reach directly to the Companyrsquos selectionscreen
X Members holding shares in dematerialised formwill then reach the lsquoPassword Creationrsquo menuwherein they are required to mandatorily entertheir login password in the new password fieldKindly note that this password can be used forvoting on resolutions of any other company onwhich you are eligible to vote provided that thesaid company opts for e-voting through CDSLplatform It is strongly recommended not to shareyour password with any other person and takeutmost care to keep your password confidential
XI For Members holding shares in certificate formthe details can be used only for e-voting on theResolutions contained in this Notice
XII Click on the EVSN for Gujarat Hotels Limited
XIII On the voting page you will see lsquoResolutionDescriptionrsquo and against the same the optionlsquoYes Norsquo for voting Select the option lsquoYesrsquo or lsquoNorsquoas desired The option lsquoYesrsquo implies that youassent to the Resolution and the option lsquoNorsquoimplies that you dissent to the Resolution
XIV Click on the lsquoResolutions File Linkrsquo if you wish toview the entire Resolution details
XV After selecting the Resolution you have decidedto vote on click on lsquoSubmitrsquo A confirmation boxwill be displayed If you wish to confirm your voteclick on lsquoOkrsquo else to change your vote click onlsquoCancelrsquo and accordingly modify your vote
XVI Once you lsquoConfirmrsquo your vote on the Resolutionyou will not be allowed to modify your vote
XVII You can also take a print of the votes cast byclicking on lsquoClick here to printrsquo option on theVoting page
XVIII Members can also cast their vote using CDSLrsquosmobile app lsquom-Votingrsquo available on Android Appleand Windows based mobiles Members may login to m-Voting using their e-voting credentials tovote on the Company Resolutions
XIX Note for NonndashIndividual Members and Custodians
bull Non-Individuals Members (ie other than HUFIndividuals NRI etc) and Custodians are requiredto log on to wwwevotingindiacom and registerthemselves as Corporates
bull A scanned copy of the Registration Form bearingthe stamp and sign of the entity should be emailedto helpdeskevotingcdslindiacom
bull After receiving the login details user would be ableto link the account(s) for which they wish to voteon
bull The list of accounts linked in the login should bemailed to helpdeskevotingcdslindiacom and onapproval of the accounts they would be able tocast their vote
bull A scanned copy of the Board Resolution and Powerof Attorney (POA) which they have issued in favourof the Custodian if any should be uploaded in PDFformat in the system for the Scrutinizer to verify thesame
XX In case you have any queries or issues regardinge-voting you may refer to the Frequently AskedQuestions and e-voting manual available underthe help section of CDSLrsquos e-voting websitewwwevotingindiacom or write an email tohelpdeskevotingcdslindiacom or contact
6
Mr Rakesh Dalvi at telephone no 18002005533(toll free) You may also address your queries grievances relating to remote e-voting or votingat the meeting to Mr M Agarwal ComplianceOfficer at e-mail ID ghlinvestorsyahoocoin orat telephone no 0265 233 0033
XXI Those who become Members of the Companyafter despatch of the Notice but on or before31st August 2019 (cut-off date) may follow thesteps from Sl Nos II to XIX mentioned above forcasting of vote
XXII General Information
(a) There will be one vote for every Client ID NoRegistered Folio No irrespective of thenumber of joint holders
(b) The Results of voting will be declaredwithin 48 hours from the conclusion of theAGM and the Resolutions will be deemedto be passed on the date of the AGMsubject to receipt of requisite number ofvotes The declared Results along with theScrutinizerrsquos Report will be availableforthwith on the Companyrsquos websitewwwgujarathotelsltdin under the sectionlsquoInvestor Relationsrsquo and on the website ofCDSL such Results will also be forwardedto BSE Limited where the Companyrsquosshares are listed
EXPLANATORY STATEMENT
Annexed to the Notice convening the Thirty Seventh AnnualGeneral Meeting to be held on Saturday 7th September2019
Item No 5
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 28th June 2019 on the recommendationof the Nominations and Remuneration Committee(lsquothe Committeersquo) approved the appointment of Mr MohanSwarup Bhatnagar as Additional Director with effect from28th June 2019 and subject to the approval of the Membersalso as Independent Director of the Company for a periodof five years with effect from the said date in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquotheActrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquothe Listing Regulations2015rsquo)
Mr Bhatnagar (67) is a Science Graduate from St StephenrsquosCollege University of Delhi and is an MBA from the Facultyof Management Studies University of Delhi
Mr Bhatnagar joined ITC Limited (ITC) in 1975 in the HotelsDivision He held various job positions in Finance beforetaking over as the Head of Finance in 1997 withresponsibility for Treasury Audit Purchasing MaterialManagement and Information Technology Subsequentlyhe held charge of Growth and Development for the HotelsBusiness as Executive Vice President He was a memberof the Management Committee of the Division and was onthe Boards of Joint Venture and Subsidiary companies ofITC He retired from ITC in September 2013 Currently heis actively involved in angel investing and in mentoringselect start-up ventures
The Committee and the Board are of the view that theassociation of Mr Bhatnagar and the rich experience hebrings with him would benefit the Company Declarationhas been received from Mr Bhatnagar that he meets thecriteria of Independence prescribed under Section 149 ofthe Act read with the Companies (Appointment andQualification of Directors) Rules 2014 and Regulation 16of the Listing Regulations 2015 In the opinion of your BoardMr Bhatnagar fulfils the conditions specified in the Act theRules thereunder and the Listing Regulations 2015 forappointment as an Independent Director and he isindependent of the management of the CompanyMr Bhatnagar will be entitled to sitting fees for attending themeetings of the Board and its Committees
Requisite Notice under Section 160 of the Act proposingthe appointment of Mr Bhatnagar has been received by theCompany and consent has been filled by Mr Bhatnagarpursuant to Section 152 of the Act
Mr Bhatnagar holds 2500 shares in the Company
Mr Bhatnagar and his relatives are interested in thisResolution None of the other Directors and Key ManagerialPersonnel of the Company or their relatives is interestedin this Resolution
The Board recommends this Resolution for your approval
Item Nos 6 amp 7
The Members of the Company at the Thirty Second AnnualGeneral Meeting held on 29th September 2014 approvedthe appointment of Mr Koshy and Mr M Narayanan asIndependent Directors of the Company for a period of fiveyears with effect from the said date Mr Koshy andMr Narayanan will complete their respective terms on28th September 2019
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 15th April 2019 on the recommendationof the Nominations and Remuneration Committee (lsquotheCommitteersquo) recommended for the approval of theMembers the re-appointment of Mr Koshy andMr Narayanan as Independent Directors of the Companywith effect from 29th September 2019 in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquothe
7
Actrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquoListing Regulations2015rsquo) as set out in the Resolutions relating to theirrespective re-appointment
The Committee and the Board are of the view that giventhe knowledge experience and performance of Mr Koshyand Mr Narayanan and contribution to the Board processesby them their continued association would benefit theCompany Declarations have been received from Mr Koshyand Mr Narayanan that they meet the criteria ofIndependence prescribed under Section 149 of the Act readwith the Companies (Appointment and Qualification ofDirectors) Rules 2014 and Regulation 16 of the ListingRegulations 2015 In the opinion of the Board Mr Koshyand Mr Narayanan fulfil the conditions specified in the Actthe Rules thereunder and the Listing Regulations 2015 forre-appointment as Independent Directors and they areindependent of the management of the Company Mr Koshyand Mr Narayanan will be entitled to sitting fees for attendingmeetings of the Board and its Committees
Consent of the Members by way of Special Resolution isrequired for re-appointment of Mr Koshy and Mr Narayananin terms of Section 149 of the Act Further pursuant toRegulation 17 of the Listing Regulations 2015 consent ofthe Members by way of Special Resolution is also requiredfor continuation of a Non-Executive Director beyond the ageof seventy five years During the proposed term ofre-appointment Mr Koshy and Mr Narayanan will attain theage of seventy five years on 12th February 2020 and1st July 2020 respectively The Special Resolutions under
Item No 6 and 7 once passed shall also be deemed asyour approval under the Listing Regulations 2015 forcontinuation of Mr Koshy and Mr Narayanan as IndependentDirectors beyond the age of seventy five years
Requisite Notices under Section 160 of the Act proposingthe re-appointment of Mr Koshy and Mr Narayanan havebeen received by the Company and consents have beenfiled by Mr Koshy and Mr Narayanan pursuant to Section152 of the Act
Additional information in respect of Mr Koshy andMr Narayanan pursuant to the Listing Regulations 2015and the Secretarial Standard on General Meetings isappearing in the Report and Accounts under the sectionslsquoYour Directorsrsquo and lsquoReport on Corporate GovernancersquoMr Koshy and Mr Narayanan do not hold any share in theCompany either in their individual capacity or on a beneficialbasis for any other person
Mr Koshy and Mr Narayanan and their relatives areinterested in the Special Resolutions relating to theirrespective re-appointment None of the other Directors andKey Managerial Personnel of the Company or theirrelatives is interested in these Special Resolutions
The Board recommends these Special Resolutions for yourapproval
By Order of the BoardGujarat Hotels Limited
Place New Delhi Jagdish SinghDate 15th July 2019 Director
8
ROUTE MAP
AGM VenueWelcomHotel VadodaraR C Dutt Road AlkapuriVadodara 390 007
9
N Anand
Nakul Anand (62) DIN 00022279 a Non-Executive Directorof the Company since 10th March 1998 was appointed asthe Chairman of the Company effective 21st March 2009He is an Executive Director on the Board of ITC Limited andholds responsibility for the Hospitality Travel amp Tourismand Lifestyle Retailing businesses of ITC
An Economics Honours Graduate from the Delhi Universitywith an AMP degree from the Bond University AustraliaAnand joined ITC Hotelsrsquo Management TrainingProgramme in 1978 He has also served as the ManagingDirector of erstwhile ITC Hotels Limited during the period2003-05
In a career that spans close to four decades Anand hasbeen acknowledged in the hotels and tourism industry forhis vision and commitment Leveraging the significantlearning of sustainable excellence within ITC he led theteam at ITC Hotels to pioneer the concept of lsquoResponsibleLuxuryrsquo in the hospitality industry securing LEEDreg Platinumcertifications for all ITC premium luxury hotels He hasformulated value-based strategies to create a uniquequality control model His dynamic leadership and passionfor the business is recognised and acknowledged by hispeers He has been a past President of the HotelAssociation of India and past Chairman of the CII NationalTourism Committee Anand is presently a member of theNational Tourism Advisory Council constituted by theMinistry of Tourism Government of India Chairman of theFederation of Associations in Indian Tourism amp Hospitalityand a Member of the Executive Committee of the HotelAssociation of India He is also a Member of the IndiandashSriLanka CEOs Forum Council Member amp ExecutiveCommittee Member of the National Culture Fund Ministryof Culture Government of India and a Member on the Boardof the International Tourism Partnership
Other Directorships
Name of the company Position
International Travel House Limited Chairman amp Non-Executive Director
Landbase India Limited Chairman amp Non-Executive Director
Fortune Park Hotels Limited Chairman amp Non-Executive Director
WelcomHotels Lanka (Private) Limited Chairman amp Non-Executive Director
Srinivasa Resorts Limited Vice Chairman amp Non-Executive Director
ITC Limited Executive Director
Bay Islands Hotels Limited Non-Executive Director
Maharaja Heritage Resorts Limited Non-Executive Director
Committee Membership of other companies
Name of the Committee Positioncompany
International Travel House Limited Nominations amp MemberRemuneration Committee
Landbase India Limited Audit Committee Member
Fortune Park Hotels Limited Corporate Social ChairmanResponsibility Committee
CK Koshy
Cheruvettolil Kochukoshy Koshy (74) DIN01478704 wasappointed as an Independent Non-Executive Director ofthe Company on 1st May 2007 He is Master of Arts inPolitical Science and Public Administration He joined theIndian Administrative Service in 1968 from the Gujarat Cadreand superannuated in February 2005
In a long career spanning over 38 years he has held severaleminent positions including those of Additional ChiefSecretary - Department of Revenue Industries and MinesTourism and Civil Aviation and Finance and PrincipalSecretary to the Chief Minister He served the Governmentof India as Joint Secretary amp Financial Advisor to theDepartment of Atomic Energy and as Executive Director ofNuclear Power Corporation of India Limited He has heldthe posts of Managing Director of the Tourism Corporationof Gujarat Sardar Sarovar Narmada Nigam Gujarat StateSmall Industries Corporation and Girinar Scooter LimitedHe was also the Joint Managing Director of the GujaratIndustrial Investment Corporation and Chairman of GujaratState Petroleum Corporation Limited Gujarat State PetronetLimited and Gujarat Energy Research and ManagementInstitute
Post retirement he has been a consultant to the Departmentfor International Development - UK the World Bank and tothe Department of Personnel and Administrative ReformsGovt of India He was appointed Professor Emeritus in thefaculty of Planning and Public Policy at CEPT UniversityAhmedabad and is an Advisor to both Indian School ofPetroleum and Energy New Delhi and University ofPetroleum and Energy Studies Dehradun Currently he isAdvisor at CEPT University and on the Board of Trustees ofAlliance Francaise Gujarat and GIAN an NGO whichencourages innovation at the grass root level
Koshy does not hold directorship of any other company
M Narayanan
Mahalinga Narayanan (74) DIN 00159288 was appointedas an Independent Non-Executive Director of the Companyon 10th January 2008 He is a post graduate in CommerceGraduate in Law Diploma Holder in Business Managementand holds certified Associated Membership of the Indian
YOUR DIRECTORS
10
Institute of Bankers He has rich experience of over fourdecades in Banking Project Finance Administration andrelated areas
Narayanan started his career with the Reserve Bank ofIndia in 1964 and moved over to the Bank of Baroda in1969 and continued till March 1985 During his tenure inBank of Baroda he worked in all departments of commercialbanking operation and was in-charge of large branches ofthe Bank In April 1985 he joined Industrial FinanceCorporation of India and held senior managementpositions In October 1997 he joined Tourism FinanceCorporation of India Limited as Managing Director and roseto the position of Chairman and Managing Director whichposition he held till his retirement in September 2006 Hewas conferred with ldquoUdyog Rattan Awardrdquo in the year 2005by the Institute of Economic Studies New Delhi
Other Directorships
Name of the company Position
Cox amp Kings Limited Independent DirectorTulip Star Hotels Limited Independent DirectorRoyale Indian Rail Tours Limited Independent DirectorPride Hotels Limited Chairman amp Independent Director
Committee Membership of other Companies
Name of the company Committee Position
Cox amp Kings Limited Audit Committee ChairmanRemuneration MemberCommittee
Pride Hotels Limited Audit Committee ChairmanRoyale Indian Rail Tours Limited Audit Committee Chairman
Tulip Star Hotels Limited Audit Committee Chairman
J Singh
Jagdish Singh (53) DIN 00042258 was appointed as aNon-Executive Director on the Board of the Company on16th April 2016 A Commerce Graduate and a CharteredAccountant Singh joined ITC Limited in the year 1990During these 26 years he has held various positions inthe finance function He started his career in Treasury andmoved as Corporate Accountant Commercial Manager atCigarette factory at Munger and Head of Finance at ITCEssentra Limited He was then the Head of Treasury
between 2005 and 2015 and is presently the Head ofFinance at ITCrsquos Hotels Division
Other DirectorshipsName of the company Position
International Travel House Limited Non-Executive DirectorFortune Park Hotels Limited Non-Executive DirectorBay Islands Hotels Limited Non-Executive DirectorSrinivasa Resorts Limited Non-Executive DirectorMaharaja Heritage Resorts Limited Non-Executive DirectorMimec (India) Limited Non-Executive DirectorLandbase India Limited Additional Non-Executive DirectorLogix Developers Private Limited Non-Executive Director
Committee Membership of other companiesName of the Committee Positioncompany
International Travel House Limited Stakeholders Relationship MemberCommitteeAudit Committee MemberNominations amp Remuneration MemberCommittee
Fortune Park Hotels Limited Corporate Social MemberResponsibility Committee
Srinivasa Resorts Limited Audit Committee ChairmanCorporate Social MemberResponsibility Committee
D R Choudhury
Devkanya Roy Choudhury (41) DIN 07066556 wasappointed as a Non-Executive Director of the Company on19th January 2015 A Graduate from the National LawSchool of India University Bengaluru she joined ITC Limitedin 2001 As part of Corporate Legal of ITC she has rich andvaried experience in handling legal matters pertaining tovarious divisions including Tobacco Hotels Personal CareLifestyle Retailing Education amp Stationery Paperboards ampSpecialty Papers ITC Infotech as also dealing with mergersamp acquisitions and key litigation across ITC CurrentlyMs Choudhury is the Senior Associate General Counsel ofITC Limited
Other Directorships
Name of the Company Position
WelcomHotels Lanka (Private) Limited Non-Executive Director
YOUR DIRECTORS
Denotes foreign company Denotes listed Indian company whose equity shares or preference shares or debt securities are listed on a recognised
stock exchangeNotes1 Other Directorships and Committee Memberships of Directors are as on 15th April 20192 Committee Memberships cover Committees under the Companies Act 2013 viz Audit Committee Stakeholders
Relationship Committee Nomination and Remuneration Committee and CSR Committee of Indian Companies
11
REPORT ON CORPORATE GOVERNANCE
The Directors present the Companyrsquos Report on CorporateGovernance pursuant to the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements)Regulations 2015 (lsquoListing Regulations 2015rsquo)
THE COMPANYrsquoS GOVERNANCE PHILOSOPHY
The Company firmly believes in good CorporateGovernance and has made it a practice and a continuousprocess of development right across the Company TheCompanyrsquos philosophy on Corporate Governanceenvisages attainment of high level of transparency andaccountability in the functioning of the Company andconduct of business and places due emphasis onregulatory compliance It has empowered the ExecutiveManagement to take decisions with regard to day-to-dayoperations and has also created checks and balances thatsuch decisions are taken with care and responsibility tomeet stakeholdersrsquo aspirations and societal expectations
The Companyrsquos corporate philosophy is focused on itspeople who are its most important asset and it values itsemployeesrsquo integrity creativity ability judgement andopinions who in turn demonstrate the highest ethicalstandards and responsibility towards the shareholdersThis has helped the Company take rapid strides in itspursuit of excellence
The Company is committed to enhance shareholder valuein a fair and transparent manner and has been in theforefront for benchmarking itself with the best businesspractices globally
BOARD OF DIRECTORS
All statutory and other significant and material informationare placed before the Board of Directors (the Board) toenable it to discharge its responsibility of strategicsupervision of the Company as trustees of theshareholders
Composition
The Board comprises entirely of Non-Executive Directorsincluding one Woman Director and two IndependentDirectors The strength of the Board as on 15th April 2019is five
The Board Diversity Policy of the Company requires theBoard to have balance of skills experience and diversity ofperspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the Annexure forming part ofthis Report These skills expertise and competencies areavailable in the present mix of the Directors of the Company
Composition of the Board as on 31st March 2019
Category No of PercentageDirectors to total no
of Directors
Non-Executive Independent Directors 3 50Other Non-Executive Directors 3 50Total 6 100
During the year there was no change in the directorshipMr R C Mehta resigned as Non-Executive IndependentDirector of the Company with close of work on 31st March2019 keeping in view the Regulation 17(1A) of ListingRegulations 2015
Mr Mehta has confirmed that there are no other reasons forhis resignation other than stated above
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Board were held The intervening periodbetween two Board meetings was well within the maximumgap of 120 days prescribed under the Listing Regulations2015
Board Agenda
Meetings are governed by a structured agenda The Boardmembers in consultation with the Chairman may bring upany matter for the consideration of the Board All majoragenda items are backed by comprehensive backgroundinformation to enable the Board to take informed decisionsAgenda papers are generally circulated seven days prior tothe Board meeting
Information placed before the Board
The following matters are tabled for the Boardrsquos periodicreview information
bull Annual operating plans amp budgets and periodic reviewof the Companyrsquos businesses
bull Quarterly performance
bull External Audit Management Reports (through the AuditCommittee)
bull Status of legal compliance
bull Status and effectiveness of risk management plans
bull Succession to senior management (through theNominations and Remuneration Committee)
bull Statutory compliance reports
bull Show cause demand prosecution adjudicationnotices if any from revenue authorities which areconsidered materially important including anyexposure that exceeds 1 of the Companyrsquos net worthand their outcome
12
bull W rite-offs disposals (fixed assets receivablesadvances etc) on a half-yearly basis
bull Significant development in Human Resources Industrial Relations
bull Material non-compliance of any regulatory or listingrequirements and in relation to shareholdersrsquoservices
bull All other matters required to be placed before theBoard for its review information under the ListingRegulations 2015 and other statutes
Post-meeting follow-up systemThe Governance processes in the Company include aneffective post-meeting follow-up review and reportingprocess for action taken pending on decisions of the Boardand the Board Committees
Details of Board Meeting during the financial year
During the financial year ended 31st March 2019 fourmeetings of the Board were held as follows
SI Date Board No ofNo Strength Directors
present
1 17th April 2018 6 6
2 7th August 2018 6 6
3 1st November 2018 6 5
4 30th January 2019 6 5
COMMITTEES OF THE BOARD
Currently there are three Committees of the Board ndash theAudit Committee the Stakeholders RelationshipCommittee and the Nominations and RemunerationCommittee The terms of reference of the BoardCommittees are determined by the Board from time to timeMeetings of Board Committees are convened by therespective Committee Chairman All the recommendationsmade by Board Committees during the year were acceptedby the Board Minutes of Board Committee meetings areplaced before the Board for its information The role andcomposition of these Committees including the numberof meetings held during the financial year and the relatedattendance are provided below
A AUDIT COMMITTEEThe Audit Committee of the Board provides reassurance tothe Board on the existence of an effective internal controlenvironment that ensuresbull efficiency and effectiveness of operations
bull safeguarding of assets and adequacy of provisionsfor all liabilities
bull reliability of financial and other managementinformation and adequacy of disclosures
bull compliance with all relevant statutesThe role of the Committee includes the followingbull To oversee the Companyrsquos financial reporting process
and the disclosure of its financial information to
REPORT ON CORPORATE GOVERNANCE
Directorsrsquo attendance at the Board Meetings during the financial year and at the last Annual General Meeting (AGM) as alsotheir other Directorships and Committee Memberships are given below
SI Director Category No of Attendance No of No of Membership(s) No Board at last other Chairmanship(s) of Audit
Meetings AGM Directorship(s) Committee Stakeholdersattended Relationship Committee of
other Indian public limitedcompanies
1 N Anand Chairman amp 4 Yes 8 1Non-Executive Director
2 C K Koshy Non-Executive 4 Yes Nil NilIndependent Director
3 R C Mehta1 Non-Executive 2 Yes 4 NilIndependent Director
4 M Narayanan Non-Executive 4 Yes 4 4 (all as Chairman)Independent Director
5 D R Choudhary Non-Executive Director 4 Yes 1 Nil6 J Singh Non-Executive Director 4 Yes 8 3 (including 1 as Chairman)
1 Resigned as Non-Executive Independent Director wef 1st April 2019 Details with respect to other Directorships of the Directors are provided under the section lsquoYour Directorsrsquo in the Report and Accounts
13
ensure that the financial statements are correctsufficient and credible
bull To recommend the appointment remuneration termsof appointment and removal of Statutory Auditors
bull To approve transactions of the Company with relatedparties
bull To evaluate the Companyrsquos internal financial controlsand risk management systems
bull To review with the management the following
- Annual financial statements and Auditorrsquos Reportthereon before submission to the Board forapproval
- Quarterly financial statements before submissionto the Board for approval
bull To review the following
- Management discussion and analysis of financialcondition amp results of operations and mattersrequired to be included in the DirectorsrsquoResponsibility Statement
- Adequacy of internal control systems and theCompanyrsquos statement on the same prior toendorsement by the Board such review to bedone in consultation with the managementStatutory and Internal Auditors
- Adequacy of internal control systems forcompliance with the provisions of the Securitiesand Exchange Board of India (Prohibition ofInsider Trading) Regulations 2015
- Reports of Internal Audit and discussion withInternal Auditors on any significant findings andfollow-up thereon
- Statutory Auditorsrsquo independence andperformance and effectiveness of the auditprocess
- System for storage retrieval security etc of booksof account maintained in the electronic form
- Functioning of Whistleblower mechanism in theCompany
Composition
The Audit Committee as on 15th April 2019 comprisesthree Non-Executive Directors two of whom are IndependentDirectors The Chairman of the Committee is anIndependent Director The Chief Executive Officer the ChiefFinancial Officer and the representative of Statutory Auditorsare Invitees to meetings of the Audit Committee and theCompany Secretary is the Secretary to the Committee Allmembers of the Committee are financially literate twomembers including the Chairman of the Committee haveaccounting and financial management expertise
The names of the members of the Audit Committeeincluding its Chairman are provided under the sectionlsquoBoard of Directors amp Committeesrsquo in the Report andAccounts
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Audit Committee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 4 4
2 7th August 2018 4 4
3 1st November 2018 4 3
4 30th January 2019 4 3
Attendance at Audit Committee Meetings during thefinancial year
Member No of meetingsattended
M Narayanan1 4
C K Koshy 4
R C Mehta2 2
J Singh 41 Appointed Chairman wef 15th April 20192 Ceased to be Member and Chairman wef 1st April 2019
B STAKEHOLDERS RELATIONSHIP COMMITTEE
The Stakeholders Relationship Committee of the Boardoversees redressal of shareholder and investor grievancesand inter alia approves transmission of sharessub-division consolidation renewal of share certificatesissue of duplicate share certificates etc
Composition
The Stakeholders Relationship Committee presentlycomprises three Non-Executive Directors including oneIndependent Director The Chairman of the Committee is aNon-Executive Director The Company Secretary is theSecretary to the Committee
The names of the members of the StakeholdersRelationship Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 sevenmeetings of the Stakeholders Relationship Committeewere held as follows
REPORT ON CORPORATE GOVERNANCE
14
SI Date Committee No ofNo Strength Members
present1 17th April 2018 2 2
2 29th June 2018 2 2
3 7th August 2018 2 2
4 27th September 2018 2 2
5 1st November 2018 2 2
6 4th January 2019 2 2
7 30th January 2019 2 2
Attendance at Stakeholders Relationship CommitteeMeetings during the financial year
Member No of meetingsattended
J Singh 7
D R Choudhury 7
C K Koshy 0
Appointed Member wef 31st March 2019
C NOMINATIONS AND REMUNERATION COMMITTEEThe Nominations and Remuneration Committee of theBoard inter alia identifies persons qualified to becomeDirectors and formulates criteria for evaluation ofperformance of the Directors and the Board as a wholeThe Committeersquos role includes recommending to theBoard the appointment remuneration and removal ofDirectors and Key Managerial Personnel
Composition
The Nominations and Remuneration Committee as on15th April 2019 comprises four Non-Executive Directorstwo of whom are Independent Directors The Chairman ofthe Committee is an Independent Director The CompanySecretary is the Secretary to the Committee
The names of the members of the Nominations andRemuneration Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 twomeetings of the Nominations and RemunerationCommittee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 5 5
2 30th January 2019 5 4
Attendance at Nominations and Remuneration CommitteeMeetings during the financial year
Member No of meetingsattended
C K Koshy 2
N Anand 2
R C Mehta1 1
M Narayanan 2
J Singh 21 Ceased to be Member wef 1st April 2019
Remuneration Policy
The Companyrsquos Remuneration Policy aims at attractingand retaining high calibre talent The Remuneration Policytherefore is market-led and takes into account thecompetitive circumstance of each business so as to attractand retain quality talent and leverage performancesignificantly
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpwwwgujarathotels ltd in polic ies Remuneration-Policy_GHLpdf There has been no change in the Policyduring the year
Remuneration of Directors
Non-Executive Directors are entitled to sitting fees forattending the meetings of the Board and its Committeesthe quantum of which is determined by the Board Thesitting fees to Non-Executive Directors as determined bythe Board are ` 20000- and ` 10000- for each meeting ofthe Board and its Committees respectively
Details of sitting fees paid to the Directors during thefinancial year ended 31st March 2019
Director Sitting Fees (`)
C K Koshy 150000-
R C Mehta1 70000-
M Narayanan 150000-1 Resigned as Non-Executive Independent Director wef1st April 2019
Note Disclosure with respect to Non-Executive Directors ndashPecuniary relationship or transaction None
Performance Evaluation
Performance evaluation of the Board the BoardCommittees and the individual Directors was carried outby the Board in accordance with the Policy approved by theNominations and Remuneration Committee in this regardbrief details of the same are provided in the lsquoReport of theBoard of Directors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
REPORT ON CORPORATE GOVERNANCE
15
Directorsrsquo Shareholding
Details of Shareholding of the Directors in the Company ason 31st March 2019 are given below
Director No of Equity Shares of ` 10-each held singly jointly
N Anand 200
D R Choudhury Nil
C K Koshy Nil
R C Mehta Nil
M Narayanan Nil
J Singh Nil
OTHER DISCLOSURESbull Details of non-compliances penalties and strictures
by Stock Exchanges SEBI Statutory Authorities onany matter related to capital markets during the lastthree years
Nonebull Inter-se relationships between Directors and Key
Managerial Personnel of the Company
Nonebull Materially significant related party transactions which
may have potential conflict with the interests of theCompany at large
Nonebull Material financial and commercial transactions of
senior management where they may have hadpersonal interest and which had potential conflict withthe interests of the Company at large
Nonebull Details of utilisation of funds raised through
preferential allotment or qualified institutionsplacement
Not Applicablebull Credit rating(s) obtained by the Company for any debt
instrument fixed deposit programme or any otherscheme involving mobilisation of funds
Nonebull None of the Directors of the Company has been
debarred or disqualified from being appointed orcontinuing as a Director by SEBI Ministry of CorporateAffairs Statutory Authorities which has also beenconfirmed by Messrs PB amp Associates PractisingCompany Secretaries
bull Confirmation by the Board with respect to theIndependent Directors is provided in the lsquoReport ofthe Board of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Disclosures in relation to the Sexual Harassment ofWomen at Workplace (Prevention Prohibition andRedressal) Act 2013 are provided in the lsquoReport of theBoard of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Information with respect to lsquoCommodity Price Risk orForeign Exchange Risk and Hedging Activitiesrsquo
Nonebull The total fees paid by the Company to Messrs K C
Mehta amp Co Statutory Auditors and all other entitiesforming part of the same network aggregate` 100000-
bull Compliance Officer under the Listing Regulations2015
Deepak Kumar Gulati Company Secretary
MEANS OF COMMUNICATION
Timely disclosure of consistent comparable relevant andreliable information on corporate financial performance isat the core of good governance Towards this end thequarterly results of the Company were announced withinforty five days from the end of the quarter Audited annualresults along with the results for the fourth quarter wereannounced within sixty days from the end of the financialyear Extract of these results were published in lsquoTheFinancial Expressrsquo (all editions) and in its Gujarati editionas vernacular newspaper Further quarterly resultsshareholding pattern and other material events amp importantinformation relating to the Company were submitted to BSELimited through BSE Listing Centre for dissemination onits website The Company publishes its quarterlyhalf-yearly and annual financial results and also posts suchresults on its website wwwgujarathotelsltdin
The Report of the Board of Directors forming part of theReport and Accounts includes all aspects of lsquoManagementDiscussion and Analysisrsquo as required under the ListingRegulations 2015
GHL CODE OF CONDUCT FOR PREVENTION OF INSIDERTRADING ndash 2019
The GHL Code of Conduct for Prevention of Insider Tradingapproved by the Board inter alia prohibits trading insecurities of the Company by Directors and employeeswhile in possession of unpublished price sensitiveinformation in relation to the Company
GHL CODE OF CONDUCT
The GHL Code of Conduct is applicable to Directors seniormanagement and employees of the Company The Codeis derived from three interlinked fundamental principlesviz good corporate governance good corporate citizenshipand exemplary personal conduct in relation to theCompanyrsquos business and reputation The Code coversGHLrsquos commitment to sustainable development concern
REPORT ON CORPORATE GOVERNANCE
16
for occupational health safety and environment a genderfriendly workplace transparency and auditability legalcompliance and the philosophy of leading by personalexample The Code is available on the Companyrsquos website
Declaration as required under the Listing Regulations 2015All Directors and senior management of the Companyhave affirmed compliance with the GHL Code of Conductfor the financial year ended 31st March 2019New Delhi K Pahwa15th April 2019 CEO
WHISTLEBLOWER POLICYSynopsis of the Whistleblower Policy of the Company isprovided in the lsquoReport of the Board of Directors ampManagement Discussion and Analysisrsquo forming part of theReport and Accounts The Whistleblower Policy is alsoavailable on the Companyrsquos websiteFAMILIARISATION PROGRAMME FOR DIRECTORSGHL believes that a Board which is well informed familiarised with the Company and its affairs can contributesignificantly to effectively discharge its role of trusteeshipin a manner that fulfils stakeholdersrsquo aspirations andsocietal expectations In pursuit of this the Directors of theCompany are updated on changes developments in thedomestic global corporate and industry scenario includingthose pertaining to statutes legislations and economicenvironment and on matters affecting the Company toenable them to take well informed and timely decisionsFurther details may be accessed on the Companyrsquos websiteat httpwwwgujarathotelsltdinpoliciesDirectorrsquos-Familiarisation-programmespdfPOLICY ON RELATED PARTY TRANSACTIONSThe Policy as approved by the Board may be accessed onthe Companyrsquos website at
h t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_TranscationspdfDISCRETIONARY REQUIREMENTS UNDER THE LISTINGREGULATIONS 2015The status of compliance with the discretionaryrequirements under the Listing Regulations 2015 isprovided below1 Chairmanrsquos Office The Company has a Non-Executive
Chairman but he does not maintain any separate officeand hence no expense in this regard is being incurredby the Company
2 Shareholder Rights The quarterly half-yearly andannual financial results of the Company are postedon the Companyrsquos website and extract of these resultsare published in newspapers on an all India basisThe complete Report and Accounts is sent to everyShareholder of the Company
3 Audit Opinion It has always been the Companyrsquosendevour to present financial statements with
unmodified audit opinion The Statutory Auditors haveissued an unmodified audit opinion on the Companyrsquosfinancial statements for the year ended 31st March2019
4 Separate posts of Chairman and Chief ExecutiveOfficer The Company has a Non-Executive Chairmanand a Chief Executive Officer
5 Internal Audit The Internal Auditor of the CompanyMessrs Shah amp Talati Chartered Accountants reportsto the Audit Committee of the Board
GENERAL SHAREHOLDER INFORMATIONProvided in the lsquoShareholder Informationrsquo section of theReport and Accounts
CONFIRMATION OF COMPLIANCEbull It is confirmed that the Company has complied with
the requirements prescribed under Regulations 17 to27 and clauses (b) to (i) of sub - regulation (2) ofRegulation 46 of the Listing Regulations 2015
bull The Statutory Auditorsrsquo Certificate that the Companyhas complied with the conditions of CorporateGovernance is annexed to the lsquoReport of the Board ofDirectors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
ANNEXURE TO THE REPORT ON CORPORATEGOVERNANCESKILLS EXPERTISE AND COMPETENCIES OF DIRECTORSThe Company believes that Board members should havea balance of skills experience and diversity of perspectivesappropriate to the Company Accordingly the Directorsshould possess one or more of the following skillsexpertise and competencies
1 Leadership
Leadership experience in a commensurate-sizedorganisation with understanding of organisationalsystems and processes strategic areas andemerging business trends
2 Industry Knowledge and Experience
Domain knowledge of Hotel business and itsdynamics long-term strategies and regulatory ampcompetitive environment
3 Finance and Accounting
Ability to understand financial policies accountingstatements and disclosure practices to contribute tothe financial risk management policies and practicesof the Company
4 Governance
Commitment belief and experience in settinggovernance practices to support the Companys legalcompliance systems and governance polic ies practices
REPORT ON CORPORATE GOVERNANCE
17
SHAREHOLDER INFORMATION
AGM Details
Date Saturday 7th September 2019Venue WelcomHotel Vadodara R C Dutt Road
Alkapuri Vadodara 390 007Time 1100 amBook Friday 30th August 2019 toClosure Saturday 7th September 2019Dates (both days inclusive)Dividend Friday 13th September 2019PaymentDate
Registrar and Share Transfer Agents
Messrs MCS Share Transfer Agent Limited are the Registrarand Share Transfer Agents (RTA) of the Company forcarrying out share registration and other related activitiesof the Company
Address for Correspondence
MCS Share Transfer Agent LimitedF-65 1st Floor Okhla Industrial AreaPhase ndash I New Delhi - 110 020Telephone Nos 011 4140 6149-52 4160 9386Facsimile No 011 4170 9881E-mail helpdeskdelhimcsregistrarscom
Shareholders holding shares in the dematerialised formshould address their correspondence except those relatedto dividend to their respective Depository Participants
Share Transfer Committee
The Share Transfer Committee of the Company generallymeets once in ten days for approving share transfers Theprocessing activities with respect to requests received forshare transfers are completed within fifteen days from thedate of receipt of request The Committee met 11 timesduring the financial year ended 31st March 2019 to approveshare transfers There were no share transfers pendingas on 31st March 2019
The Share Transfer Committee presently comprises thefollowing
D R Choudhury - Director MemberJ Singh - Director MemberM Agarwal - Compliance Officer Member
Dematerialisation of Shares and Liquidity
The shares of the Company are available for trading in thedematerialised form under both the Depository Systems inIndia - NSDL and CDSL The International SecuritiesIdentification Number (lSIN) allotted to the Companysshares under the Depository System is INE621C01011
As on 31st March 2019 a total of 3525013 Equity Sharesof the Company which translates to 9307 of the ShareCapital stood dematerialised The processing activitieswith respect to requests received for dematerialisation arecompleted between fifteen to thirty daysShareholder Investor ComplaintsThe Company attends to Shareholder Investor complaintsqueries and other correspondence generally within fifteendays except where constrained by disputes or legalimpedimentsThe Company did not receive any complaint during thefinancial year ended 31st March 2019The e-mail ID earmarked by the Company for this purposeghlinvestorsyahoocoinDistribution of Shareholding as on 31st March 2019
No of No of EquityNo of Shareholders Shares
SharesSlab Total to Total to
Share Shareholders Capital
1 - 500 5152 9455 587438 1551501 - 1000 138 253 112061 296
1001 - 2000 68 125 100167 2652001 - 3000 26 048 62030 1643001 - 4000 16 029 58804 1554001 - 5000 11 020 50785 1345001 - 10000 23 042 163405 431
10001 - 50000 8 015 147787 39050001 - 100000 3 006 226954 599
100001 amp Above 4 007 2278084 6015Total 5449 10000 3787515 10000
Categories of Shareholders as on 31st March 2019Sl Category No of toNo Shares Share
held hold ingA Promoter Holding1 Promoter and Promoter Group
ITC Limited 1733907 4578Russell Investments Limited 300056 792Sub-Total 2033963 5370
B Non Promoter Holding2 Institutional Investorsa Mutual Funds NIL NILb Banks 100 000c Foreign Institutional Investors and NIL NIL
Foreign Portfolio InvestorsSub-Total 100 000
3 Othersa Private Corporate Bodies 193726 511b Indian Public 1335461 3527c NRIs 102362 270d Others 121903 322
Sub Total 1753452 4630Grand Total 3787515 10000
18
Monthly High and Low Quotes and Volume of Sharestraded on BSE Limited
Year Month High L o w Volume(` ) (` ) (Nos)
2018 April 13800 12000 93584May 13100 11710 26778June 12735 11500 18090July 12195 11400 27113August 12295 11450 14900September 12000 10900 23492October 11400 10505 18787November 12975 10700 15386December 11490 10700 40291
2019 January 11320 10700 22160February 11185 10005 12395March 11295 10400 21625
Performance in comparison to broad based indices suchas SampP BSE Sensex
Note - Indicates monthly closing positions
Listing of Shares on Stock Exchange (with Stock Code)BSE Limited (507960)Phiroze Jeejeebhoy Towers Dalal Street Mumbai 400 001Telephone Nos 022-2272 1233 34Facsimile No 022-2272 1919E-mail isbseindiacomWebsite wwwbseindiacom
The Listing Fee for the financial year 2019-20 has beenpaid to BSE Limited
Financial CalendarFinancial Year 2019-20(1st April - 31st March)
1 First Quarter Results July 20192 Second Quarter and October November 2019
Half-Year Results3 Third Quarter Results January February 20204 Fourth Quarter and May 2020
Annual Results
Particulars of past three AGMsAGM Financial Venue Date Time Special
Year ResolutionPassed
36th 2017-18 WelcomHotel 07-08-2018 NoneVadodara
35th 2016-17 R C Dutt Road 08-08-2017 1100 NoneAlkapuri am
34th 2015-16 Vadodara 20-09-2016 None390 007
Postal Ballot
No special resolution requiring postal ballot was eitherproposed last year or is being proposed for the ensuing AGM
SHAREHOLDER REFERENCER
Transfer of Shares in certificate form
Effective 1st April 2019 transfer of shares of a listedcompany can only be effected in dematerialised form interms of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 Shareholders holdingshares in the certificate form are therefore requested todematerialise their shares in their own interestCommunication in this respect has been sent by theCompany during the year to the concerned ShareholdersHowever transfer deeds which were lodged with theCompany on or before 31st March 2019 but were returneddue to any deficiency will be processed upon re-lodgement
Transfer of Dividend and corresponding Equity Shares tothe Investor Education and Protection Fund (IEPF)
During the financial year 2018-19 unclaimed dividend forthe financial year 2010-11 aggregating ` 636444- andthe corresponding 13150 Equity Shares in respect of whichdividend entitlements remained unclaimed for sevenconsecutive years or more have been transferred by theCompany to the IEPF established by the CentralGovernment pursuant to the provisions of Section 124 ofthe Companies Act 2013 read with the Investor Educationand Protection Fund Authority (Accounting Audit Transferand Refund) Rules 2016
Shareholders may claim their unclaimed dividend for theyears prior to and including the financial year 2010-11 andthe corresponding shares from the IEPF Authority byapplying in the prescribed Form No IEPF-5 This Form canbe downloaded from the website of the IEPF Authoritywwwiepfgovin the access link of which is also availableon the Companys website wwwgujarathotelsltdin underthe section General Information under Shareholder Value
The unclaimed dividend for the undernoted years and thecorresponding shares will be transferred by the Companyto the IEPF in accordance with the schedule given belowAttention in particular is drawn that the unclaimed dividendfor the financial year 2011-12 and the corresponding shareswill be due for transfer to the IEPF on 14th September
SHAREHOLDER INFORMATION
19
Central Depository Services (India) LimitedMarathon Futurex A Wing 25th FloorMafatlal Mill Compound N M Joshi MargLower Parel Mumbai 400 013Telephone No 022-2302 3333Facsimile No 022-2300 2035E-mail helpdeskcdslindiacomWebsite wwwcdslindiacomRemittance of Dividend through Electronic ModeThe Company provides the facility for remittance of dividendto Shareholders through RTGS (Real Time GrossSettlement) NACH (National Automated Clearing House) NEFT (National Electronic Funds Transfer)
Shareholders who have not opted for remittance of dividendthrough electronic mode and wish to avail the same arerequired to provide their bank details including IFSC (IndianFinancial System Code) and MICR (Magnetic Ink CharacterRecognition) to their respective Depository Participants(DPs) or to the RTA where shares are held in thedematerialised form and in the certificate form respectively
Shareholders holding shares in the certificate form mayuse the Mandate Form for this purpose which can bedownloaded from the Companys websitewwwgujarathotelsltdin under the section GeneralInformation under Shareholder Value
Address and Bank DetailsShareholders holding shares in the certificate form arerequested to advise the RTA of any change in their address mandate bank details to facilitate better servicingShareholders are advised that as a measure of protectionagainst fraudulent encashment their bank details oraddress as available with the RTA will be printed on thedividend warrants or demand drafts where dividend cannotbe remitted through electronic mode
Permanent Account Number (PAN)Shareholders holding shares in the certificate form arerequested to send copies of their PAN Cards to the RTA tofacilitate better servicing
Furnishing of PAN Card however is mandatory as followsi) Transferees and Transferors PAN Cards for transfer
of sharesii) Legal heirs Nominees PAN Cards for transmission
of sharesiii) Surviving joint holders PAN Cards for deletion of name
of deceased Shareholders andiv) Joint holders PAN Cards for transposition of shares
Nomination Facility
Shareholders who hold shares in the certificate form andwish to make any nomination change nomination madeearlier in respect of their shareholding in the Companyshould submit to the RTA the prescribed Form such Formcan be downloaded from the Companys website underthe section Investor Relations under Shareholder Value
SHAREHOLDER INFORMATION
2019 for which purpose communication has been sent tothe concerned Shareholders advising them to write to theCompany to claim their dividend Notices in this regardhave also been published in newspapers Details of suchunclaimed dividend and corresponding shares areavailable on the Companys website under the sectionGeneral Information under Shareholder Value
Financial Date of declaration Due date for transferYear of Dividend to IEPF2011-12 8th August 2012 14th September 2019
2012-13 13th August 2013 19th September 2020
2013-14 29th September 2014 5th November 2021
2014-15 29th September2015 5th November 2022
2015-16 20th September 2016 26th October 2023
2016-17 8th August 2017 14th September 2024
2017-18 7th August 2018 12th September 2025
The Company will not be able to entertain any claim receivedafter 12th September 2019
Shareholders who have not so far encashed their dividendwarrant(s) or have not received the same are requested toapply for duplicate warrant(s) by writing to the Companyand confirming non-encashment non-receipt of dividendwarrant(s)
Service of Documents
The Company sends Notices Report and Accounts andother communications in electronic mode to thoseShareholders who have registered their e-mail addresseswith the Company or with the Depositories and in physicalmode to the other Shareholders
Shareholders who wish to register or update their e-mailaddresses with the Company may use the Form forregistration updation which can be downloaded from theCompanys website under the section Investor Relationsunder Shareholder Value
Depository Services
Shareholders may write to the respective Depository or tothe RTA for guidance on depository services
The contact details of the Depositories are given below
National Securities Depository LimitedTrade World A Wing 4th FloorKamala Mills CompoundSenapati Bapat Marg Lower ParelMumbai 400 013Telephone No 022-2499 4200Facsimile No 022-2497 6351E-mail infonsdlcoinWebsite wwwnsdlcoin
20
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
FOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019Your Directors submit their Report for the financial yearended 31st March 2019
BUSINESS ENVIRONMENT
The global economic growth softened to 36 in 2018representing a marked slowdown compared to the 39growth anticipated at the beginning of the year buoyed bya strong fiscal expansion in the USA which was offset largelyby slower growth in some other large economies ieEurope Japan etc Going forward global growth in 2019 isprojected to decline further to 33 in the base case withrisks to the downside emanating from politicaluncertainties rising trade tensions escalatingprotectionism and tighter financial conditions
As per Ministry of Statistics amp Programme Implementation(MSPI) Indian economy registered the GDP growth of 7in 2018-19 as compared to 72 in 2017-18 The economyis expected to grow and maintain a level of 75 in 2019and 2020 as per the World Bank estimates
India is the most digitally-advanced traveller nation in termsof digital tools being used for planning booking andexperiencing a journey During 2018 foreign tourist arrivals(FTAs) in India stood at 1056 million achieving a growthrate of 52 year-on-year The Government of India is alsoworking to achieve 1 share in worldrsquos international touristarrivals by 2020 and 2 share by 2025
The operating environment in the hospitality sector showedimprovement with foreign tourist arrivals Indiarsquos risingmiddle class and increasing disposable incomes havecontinued to support the growth of domestic tourism
With the inauguration of Statue of Sardar Vallabhbhai Patelalso known as lsquoStatute of Unityrsquo which is the higheststanding statue in the world at a height of 182 meters thetourism in the city of Vadodara is expected to grow
FINANCIAL PERFORMANCE
During the year under review your Company earned licensefees of ` 36987 lakhs (previous year ` 33098 lakhs)Theother income at ` 19626 lakhs showed an increase mainlydue to improvement in return on current investment Preand post-tax profits increased to ` 51822 lakhs (previousyear ` 45313 lakhs) and ` 40788 lakhs (previous year` 33690 lakhs) respectively
Your Directors are pleased to recommend a dividend of` 350 per Equity Share of ` 10- each for the year ended31st March 2019 thereby maintaining last yearrsquos dividendand involving a cash outflow of ` 160 lakhs includingDividend Distribution Tax of ` 27 Lakhs
PROFITS DIVIDEND AND RETAINED EARNINGS
The financial results of your Company summarised areas under
For the year ended For the year ended31st March 2019 31st March 2018
Profits (` ) (` )
a Profit Before Tax 51822363 45312928
b Tax Expense
Current Tax 11653499 9272310Deferred Tax (618755) 2350502
c Profit for the year 40787619 33690116
d Other Comprehensive Income - -
e Total Comprehensive Income 40787619 33690116
Statement of Retained Earningsa At the beginning of the year 213211090 195873461
b Add Total Comprehensive Income 40787619 33690116
c Less Dividend paid including IncomeTax on Dividend paid 15981176 15954974
d Less Income Tax on Dividend paid forearlier year - 397513
e At the end of the year 238017533 213211090
Your Directors are pleased to recommend a dividend of` 350 per Equity Share (Previous Year ` 350) of ` 10-each for the year ended 31st March 2019
Details of changes in Key Financial Ratio amp Return onNet Worth
The key financial ratio of the Company where there hasbeen significant change (25 or more) and change inReturn on Net Worth are summarized below pursuant toSchedule V (B) to the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements)Regulations 2015 (Listing Regulations 2015)
HOTEL OPERATIONS
Your Hotel WelcomHotel Vadodara licensed to ITC Limitedrecorded an income of ` 249443 lakhs during the year ascompared to ` 221856 lakhs in the previous year Therewas an improvement in both occupancy and average roomrates leading to an overall improvement in HotelPerformance
Financial Ratio
2018-19 2017-18 Change
Reason for change
Current Ratio
278 223 25 Increase in value of current investment based on accumulation of market return and fresh investment done during the year out of surplus funds
Return on Net Worth
133 120 11 Due to higher rate of growth in profit after tax
21
The Food amp Beverage segment of your Companyrsquos Hotelcontinues to be a major strength The Peshawri Restaurantand the Welcom Cafeacute Cambay both retained their premiumleadership positions
Your Company has filed a writ petition in the Gujarat HighCourt seeking that the Gujarat State Government be directedto take action on your Companyrsquos application to have theleasehold land of the Hotel converted to freehold andtransferred to your Company as per the existing governmentpolicy in this regard The Honourable High Court passedan Order on 24th December 2014 restraining the StateGovernment from disturbing the peaceful and actualpossession of the Company over the hotel property in anymanner including construction thereon The writ petition ispending
Your Company is also making all efforts for expeditiousconversion of land from leasehold to freehold or in thealternative extension of Lease For further details pleaserefer to Note no 20A of the Accounts
SUBSIDIARIES ASSOCIATES AND JOINT VENTURES
The Company does not have any subsidiary associate orjoint venture
INTERNAL FINANCIAL CONTROLS
Your Company is managed by the Board of Directors andthe Executive Management with clearly defined rolesresponsibilities and authorities The Executive Managementis responsible for the day-to-day conduct of the affairs ofthe Company within the overall framework approved by theBoard Your Company also has a Code of Conduct whichrequires management to conform to the required financialand accounting policies systems and processes conductbusiness ethically and ensure strict compliance with allapplicable laws and regulations Ongoing ReviewProcesses and the Risk Management Framework create acontrol environment in the Company and provide thecornerstones for Internal Financial Controls with referenceto your Companyrsquos Financial Statements
Your Companyrsquos Financial Statements are prepared on thebasis of the Significant Accounting Policies that are carefullyselected by the management and approved by the AuditCommittee and the Board These Policies are reviewedand updated from time to time and audited by the InternalAuditor whose findings and recommendations are reviewedby the Audit Committee and tracked through toimplementation
Your Company maintains its Books of Account in electronicform Your Company has in place adequate internalfinancial controls with reference to the FinancialStatements
The Internal Auditors of the Company evaluates theadequacy and efficacy of such internal financial controlsSuch controls have been assessed during the year by the
management Based on the results of this assessmentno reportable material weakness or significant deficienciesin the design or operation of internal financial controls wereobserved Nonetheless your Company recognises that anyinternal financial control framework no matter how welldesigned has inherent limitations and accordingly regularaudit and review processes ensure that such systems arereinforced on an ongoing basis
RISK MANAGEMENT
Your Company continues its emphasis on a systems-basedapproach to business risk managementBacked by stronginternal control systems the current Risk Managementframework consists of the following key elements
- The Board of Directors (lsquoThe Boardrsquo) has clearly laiddown the roles and responsibilities of the Company inrelation to risk management covering a range ofresponsibilities from strategic to operational Theserole definitions provide the foundation for yourCompanyrsquos Risk Management Policy that is endorsedby the Board and is aimed at ensuring formulation ofappropriate risk management procedures theireffective implementation and independent monitoringand reporting by Internal Audit
- Management of risks vest with the ExecutiveManagement which is responsible for the day-to-dayconduct of the affairs of the Company within the overallframework approved by the Board
- A combination of policies and procedures which areregularly reviewed and updated in the light of changingbusiness and regulatory environment bringsrobustness to the process of ensuring that businessrisks are effectively addressed
- Appropriate structures are in place to proactivelymonitor and manage the inherent risks in businesswith unique relatively high risk profiles
- An Independent Internal Audit Firm carries out riskfocused audits enabling identification of areas whererisk management processes may need to bestrengthened
- The Audit Committee of the Board reviews the InternalAudit findings and provides strategic guidance oninternal controls The Chief Executive Officer closelymonitors the internal control environment within yourCompany including implementation of the action plansemerging out of internal audit findings
The combination of policies and processes as outlinedabove adequately address the various risks associatedwith your Companyrsquos business
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
22
AUDIT AND SYSTEMS
Your Company believes that internal control is a necessaryadjunct to the principle of governance that freedom ofmanagement should be exercised within a framework ofappropriate checks and balances Your Company remainscommitted to ensuring an effective internal controlenvironment that provides assurance and comfort on orderlyand efficient conduct of operations security of assetsprevention and detection of frauds errors accuracy andcompleteness of accounting records and timely preparationof reliable financial information
Your Companyrsquos independent and robust Internal Auditprocesses provide assurance on the adequacy andeffectiveness of internal controls compliance withoperating systems internal policies and regulatoryrequirements
The Internal Audit function consisting of an outsourcedprofessional firm is adequately resourced to deliver highstandards of audit assurances
The Audit Committee of your Board met four times duringthe year The Terms of Reference of the Audit Committeeincluded reviewing the adequacy and effectiveness of theinternal control environment monitoring implementationof the action plans emerging out of Internal Audit findingsincluding those relating to strengthening of your Companyrsquosrisk management systems and discharge of statutorymandate
HUMAN RESOURCE DEVELOPMENT
Your Company firmly believes that employees are the vitaland most valuable assets and hence has created afavourable work environment that encourages innovationand meritocracy Your Company continues to innovate inthe way human resources are managed and developedstriking a balance between business needs and individualaspirations
With an undying commitment to render delightful servicesyour Companyrsquos employees consistently work towardsdelivering flawless performance and are continuing todelight customers
The Company provides a safe secure inclusive and genderfriendly workplace The Company has put in placeGrievance Redressal Procedures and adopted a Policy onSexual Harassment as per the provisions of the SexualHarassment of W omen at W orkplace (PreventionProhibition and Redressal) Act 2013 and the Rules framedthereunder The Company has an Internal ComplaintsCommittee to ensure that grievances in this regard if anyare effectively addressed During the year under review nocomplaint relating to sexual harassment has beenreceived
WHISTLEBLOWER POLICY
The Companyrsquos W histleblower Policy encouragesDirectors and employees to bring to the Companyrsquosattention instances of unethical behavior actual orsuspected incidents of fraud actual or suspectedinstances of leak of unpublished price sensitive informationor violation of the GHL Code of Conduct that could adverselyimpact the Companyrsquos operations business performanceand or reputation The Policy provides that the Companyinvestigates such incidents when reported in an impartialmanner and takes appropriate action to ensure that therequisite standards of professional and ethical conductare always upheld It is the Companyrsquos Policy to ensurethat no employee is victimised or harassed for bringingsuch incidents to the attention of the Company
The practice of the Whistleblower Policy is overseen by theAudit Committee and no employee has been denied accessto the Committee The Whistleblower Policy is available onthe Companyrsquos website at httpwwwgujarathotelsltdinCorporateGovernancehtml
DEPOSITS
Your Company has not accepted any deposits from thepublic members under Section 73 of the Companies Act2013 (lsquothe Actrsquo) read with the Companies (Acceptance ofDeposits) Rules 2014 during the year
DIRECTORS
Changes in Directors
Mr R C Mehta stepped down as Non-Executive IndependentDirector of the Company with effect from close of work on31st March 2019 keeping in view the Regulation 17(1A) ofthe Listing Regulations 2015 Your Directors would like torecord their appreciation for the services rendered byMr Mehta
The Board at the meeting held on 15th April 2019 on therecommendation of the Nominations and RemunerationCommittee recommended for the approval of the Membersthe re-appointment of Mr C K Koshy and Mr M Narayananas independent directors of your Company in terms ofSection 149 of the Act and Regulation 17 of the ListingRegulations 2015 with effect from 29th September 2019
Requisite Notices under Section 160 of the Act have beenreceived in respect of Messrs Koshy and Narayanan whohave filed their consents to act as Directors of the Companyif appointed
Appropriate resolutions seeking your approval to theaforesaid appointment will appear in the Notice conveningthe Thirty Seventh AGM of your Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
23
Retirement by Rotation
In accordance with the provisions of Section 152 of the Actread with Article 147 of the Articles of Association of theCompany Mr Jagdish Singh will retire by rotation at theensuing Annual General Meeting (lsquoAGMrsquo) of your Companyand being eligible offers himself for re-election Your Boardrecommends his re-election
Number of Board Meetings
During the year ended 31st March 2019 four meetings ofthe Board were held
Attributes Qualifications amp Independence of Directorsand their Appointment
As reported last year the Nominations and RemunerationCommittee of the Board had approved the criteria fordetermining qualifications positive attributes andindependence of Directors in terms of the Act and the Rulesthereunder both in respect of Independent Directors andother Directors as applicable The criteria inter aliarequires that NonndashExecutive Directors includingIndependent Directors be drawn from amongst eminentprofessionals with experience in business finance law public administration and enterprises
The Board Diversity Policy of the Company requires theBoard to have a balance of skills experience and diversityof perspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the lsquoReport on CorporateGovernancersquo forming part of the Report and Accounts TheArticles of Association of the Company provide that thestrength of the Board shall not be fewer than three normore than twelve
Directors are appointed re-appointed with the approval ofthe Members All Directors other than IndependentDirectors are liable to retire by rotation unless otherwiseapproved by the Members One-third of the Directors whoare liable to retire by rotation retire every year and areeligible for re-election
The Independent Directors of your Company haveconfirmed that (a) they meet the criteria of independenceas prescribed under Section 149 of the Act and Regulation16 of the Listing Regulations 2015 and (b) they are notaware of any circumstance or situation which could impairor impact their ability to discharge duties with an objectiveindependent judgement and without any external influenceFurther in the opinion of the Board the IndependentDirectors fulfil the conditions prescribed under the ListingRegulations 2015 and are independent of the managementof the Company
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpw w wg u j a ra th o te ls l td in p o l i c ies R em u n era t io n -
Policy_GHLpdf There has been no change in the Policyduring the year
Board Evaluation
The Nominations and Remuneration Committee hasapproved the Policy on Board Evaluation Evaluation ofBoard Committeesrsquo functioning and individual DirectorEvaluation and also specified that such evaluation will bedone by the Board Board performance is assessed againstthe role and responsibilities of the Board as provided inthe Act and the Listing Regulations 2015 The parametersfor Board performance evaluation have been derived fromthe Boardrsquos core role of trusteeship to protect and enhanceshareholder value as well as fulfil expectations of otherstakeholders through strategic supervision of the CompanyEvaluation of functioning of Board Committees is basedon discussions amongst Committee members and sharedby each Committee Chairman with the Board IndividualDirectors are evaluated in the context of the role played byeach Director as a member of the Board at its meetingsand in assisting the Board in realising its role of strategicsupervision of the functioning of the Company in pursuit ofits purpose and goals
While the Board evaluated its performance against theparameters laid down by the Nominations andRemuneration Committee the evaluation of individualDirectors was carried out anonymously in order to ensureobjectivity The Board was briefed on functioning of BoardCommittees by the respective Committee Chairmen
Key Managerial Personnel
Mr Deependra Rana resigned as the Chief Executive Officerof the Company with effect from 17th December 2018
The Board at the meeting held on 30th January 2019 onthe recommendation of the Nominations andRemuneration Committee appointed Mr Kunal Pahwa asthe Chief Executive Officer of the Company with effect from1st February 2019
AUDIT COMMITTEE amp AUDITORS
The composition of the Audit Committee is provided underthe section lsquoBoard of Directors amp Committeesrsquo in the Reportand Accounts
Statutory Auditors
The Statutory Auditors Messrs K C Mehta amp Co CharteredAccountants (KCM) were appointed with your approval atthe Thirty Fifth AGM to hold such office till the conclusion ofthe Fortieth AGM
On the recommendation of the Audit Committee the Boardrecommended for the approval of the Members paymentof remuneration of KCM for the financial year 2019-20Appropriate resolution for this purpose will appear in theNotice convening the Thirty Seventh AGM of the Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
24
Secretarial Auditors
Your Board appointed Messrs PB amp Associates CompanySecretaries to conduct the secretarial audit of the Companyfor the financial year ended 31st March 2019 Their Reportis provided in the Annexure forming part of this Report interms of Section 204 of the Act
RELATED PARTY TRANSACTIONS
All contracts or arrangements entered into by the Companywith its related parties during the financial year were inaccordance with the provisions of the Act and the ListingRegulations 2015 All such contracts or arrangements wereentered in the ordinary course of business and on armrsquoslength basis and have been approved by the AuditCommittee
Further the details of related party transactions of theCompany in prescribed Form No AOC-2 in terms of Section134 of the Act read with Rule 8 of the Companies (Accounts)Rules 2014 is given in the Annexure to this Report YourCompanyrsquos Policy on Related Party Transactions asadopted by your Board can be accessed on the website ath t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_Transactionspdf
DIRECTORSrsquo RESPONSIBILITY STATEMENT
As required under Section 134 of the Act your Directorsconfirm having
a) followed in the preparation of the Annual Accounts theapplicable Accounting Standards with properexplanation relating to material departures if any
b) selected such accounting policies and applied themconsistently and made judgements and estimates thatare reasonable and prudent so as to give a true andfair view of the state of affairs of your Company at theend of the financial year and of the profit of yourCompany for that period
c) taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with theprovisions of the Act for safeguarding the assets ofyour Company and for preventing and detecting fraudand other irregularities
d) prepared the Annual Accounts on a going concernbasis
e) laid down internal financial controls to be followed byyour Company and that such internal financial controlswere adequate and operating effectively and
f) devised proper systems to ensure compliance withthe provisions of all applicable laws and that suchsystems were adequate and operating effectively
OTHER INFORMATION
Compliance with the conditions of Corporate Governance
The certificate of the Statutory Auditors Messrs K C Mehtaamp Co Chartered Accountants confirming compliance withthe conditions of Corporate Governance as stipulated underthe Listing Regulations 2015 is annexed
Compliance with Secretarial Standards
The Company is in compliance with the applicableSecretarial Standards issued by the Institute of CompanySecretaries of India and approved by the CentralGovernment under Section 118 of the Act
Cost Records
The Company is not required to maintain cost records interms of Section 148 of the Act read with the Companies(Cost Records and Audit) Rules 2014
Going Concern Status
There is no significant or material order passed during theyear by any regulator court or tribunal impacting the goingconcern status of the Company or its future operations
Extract of Annual Return
The information required under Section 134 of the Act readwith Rule 12 of the Companies (Management andAdministration) Rules 2014 is annexed
Particulars of Loans Guarantees or Investments
During the year ended 31st March 2019 the Company hasneither given any loan or guarantee nor has made anyinvestment under the provisions of Section 186 of the Act
Particulars relating to Conservation of Energy andTechnology Absorption
Particulars as required under Section 134 of the Act relatingto Conservation of Energy and Technology Absorption areprovided below-
Conservation of Energy
Steps taken on conservation of energy and impact thereof
Sl DescriptionNo
1 Installation of energy efficient Gas Burners and Induction Cooker
2 Improvement in energy usage efficiency in lighting system by changingover to efficient lighting solutions such as Light Emitting Diodes
3 Replacement of existing motors and pumps with more energy efficientequipment
4 Process improvement to enhance productivity and reduce specificenergy consumption
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
25
There were no employees who were employed throughoutthe year and were in receipt of remuneration aggregating` 102 crores or more or were employed for part of the yearand were in receipt of remuneration aggregating ` 850lakhs per month or more during the financial year ended31st March 2019
The information pursuant to Section 197 of the Act readwith Rule 5(2) and 5(3) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014containing the names of top 10 employees in terms ofremuneration drawn is provided in the Annexure formingpart of this report
The information required under Section 197(12) of the Actand the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is provided in theAnnexure forming part of this Report
FORWARD-LOOKING STATEMENTS
This Report contains forward-looking statements thatinvolve risks and uncertainties When used in this Reportthe words lsquoanticipatersquo lsquobelieversquo lsquoestimatersquo lsquoexpectrsquo lsquointendrsquolsquowillrsquo and other similar expressions as they relate to theCompany and or its Businesses are intended to identifysuch forward-looking statements The Companyundertakes no obligation to publicly update or revise anyforward-looking statements whether as a result of newinformation future events or otherwise Actual resultsperformances or achievements could differ materially fromthose expressed or implied in such forward-lookingstatements Readers are cautioned not to place unduereliance on these forward-looking statements that speakonly as of their dates This Report should be read inconjunction with the financial statements included hereinand the notes thereto
CONCLUSION
Your Directors and employees look forward to the futurewith confidence and stand committed to creating an evenbrighter future for all stakeholders
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
Steps taken by the Company for utilising alternate sourcesof energy NIL
Capital investment on energy conservation equipment NIL
Technology Absorption
i) Efforts in brief made towards technology absorptionand benefits derived as a result of the above effortseg product improvement cost reduction productdevelopment import substitution etc
Sl Description BenefitsNo
1 Upgradation of Fire Alarm and For Product UpgradationPublic Announcement system
2 Installation of Hoods and Fire For Product UpgradationSuppression system
3 Upgradation of CCTV monitoring For Product Upgradationsystem
4 Upgradation of Electrical Panel For Product Improvement5 Induction of Diesel Generator For Product Improvement
ii) In case of imported technology (imported during thelast 3 years reckoned from the beginning of the financialyear) following information may be furnished
A) Details of technology imported - NIL
B) Year of import - NIL
C) Whether the technology has been fully absorbed -NIL
D) If not fully absorbed areas where absorption hasnot taken place and the reasons therefor - NIL
iii) Expenditure incurred on research and development -NIL
FOREIGN EXCHANGE EARNINGS AND OUTGO
During the financial year 2018-19 foreign exchangeearnings of the Hotel aggregated ` 111754 lakhs (previousyear ` 95887 lakhs) while expenditure in foreign currencyaggregated ` 5514 lakhs (previous year ` 3230 lakhs)
EMPLOYEES
The total number of employees of the Company as on31st March 2019 stood at 198
26
ANNEXURE
FORM NO MR ndash 3SECRETARIAL AUDIT REPORTFOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019[Pursuant to Section 204(1) of the Companies Act 2013 and Rule9 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014]
ToThe MembersGujarat Hotels LimitedWe have conducted the secretarial audit of the compliance ofapplicable statutory provisions and the adherence to goodcorporate practices by Gujarat Hotels Limited a Companyincorporated under the provisions of the Companies Act 1956 andhaving its Registered Office at WelcomHotel Vadodara R C DuttRoad Alkapuri Vadodara Gujarat ndash 390 007 (hereinafter referredto as the lsquoCompanyrsquo) for the period commencing from 1st April2018 till 31st March 2019 (hereinafter referred to as the lsquoAuditPeriodrsquo) Secretarial Audit was conducted in a manner that providedus a reasonable basis for evaluating the corporate conducts statutory compliances and expressing our opinions thereonBased on our verification of the books papers minute booksforms and returns filed and other records maintained by theCompany and also the information provided by the Company itsofficers agents and authorised representatives during the conductof Secretarial Audit 2018-19 we hereby report that in our opinionthe Company has during the audit period covering the FinancialYear ended on 31st March 2019 complied with the statutoryprovisions listed hereunder and also that the Company has properBoard-processes and compliance-mechanism in place to theextent in the manner and subject to the reporting made hereinafterWe have examined the books papers minute books forms andreturns filed and other records maintained by the Company for thefinancial year ended on 31st March 2019 according to theprovisions of(i) The Companies Act 2013 (the Act) and the Rules made
thereunder(ii) The Securities Contracts (Regulation) Act 1956 (lsquoSCRArsquo)
and the Rules made thereunder(iii) The Depositories Act 1996 and the Regulations and
Bye-laws framed thereunder(iv) Foreign Exchange Management Act 1999 and the Rules and
Regulations made thereunder to the extent of Foreign DirectInvestment Overseas Direct Investment and ExternalCommercial Borrowings
(v) The following Regulations and Guidelines prescribed underthe Securities and Exchange Board of India Act 1992(lsquoSEBI Actrsquo)-(a) The Securities and Exchange Board of India
(Substantial Acquisition of Shares and Takeovers)Regulations 2011
(b) The Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations 2015
(c) The Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations2015
(d) The Securities and Exchange Board of India(Registrars to an Issue and Share Transfer Agents)Regulations 1993 regarding the Companies Act anddealing with client
We have also examined compliance with the applicable clauses ofthe following(i) The mandatory Secretarial Standards issued by The Institute
of Company Secretaries of India with respect to BoardMeetings and General Meetings
(ii) The SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015
The Company has entered into an Operating Licence Agreementwith ITC Limited which operates the Hotel ndash WelcomHotel Vadodraand ensure compliance of all laws as applicable for running andmaintenance of the HotelDuring the period under review the Company has complied withthe provisions of the Act Rules Regulations Guidelines andStandards etc as mentioned above however in the CorporateGovernance Report filed pursuant to Regulation 27(2) of SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015with BSE for the quarter ended September and December 2018there is mismatch of date of the meetingWe further report thatThe Board of Directors of the Company is duly constituted withproper balance of Non-Executive Directors and IndependentDirectors The changes in the composition of the Board of Directorsthat took place during the period under review were carried out incompliance with provisions of the ActAdequate notice is given to all Directors for the Board Meetingsand Committees Meetings agenda and detailed notes on agendawere sent at least seven days in advance and where the meetingwas held in shorter notice due compliance was made and a systemexists for seeking and obtaining further information and clarificationson the agenda items before the meeting for meaningful participationat the meetingAll decisions at Board Meetings and Committee Meetings werecarried out unanimously as recorded in the minutes of the meetingsof the Board of Directors or Committees of the Board as the casemay beWe report that there are adequate systems and processes in theCompany commensurate with the size and operations of theCompany to monitor and ensure compliance with the applicableLaws Rules Regulations and GuidelinesWe further report that during the Audit Period the Company has nospecific events actions that have a major bearing on the Companyrsquosaffairs in pursuance of the above referred Laws RulesRegulations Guidelines Standards etc
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
Note This report is to be read with our letter of even date whichis annexed as Annexure A and forms an integral part of thisreport
27
FORM NO AOC-2[Pursuant to Section 134(3)(h) of the Companies Act 2013 and Rule 8(2) of the Companies (Accounts) Rules 2014]
Form for disclosure of particulars of contracts arrangements entered into by the Company with related parties referred to insub-section (1) of Section 188 of the Companies Act 2013 including certain arms length transactions under fourth proviso thereto
1 Details of contracts or arrangements or transactions not at arms length basis
a) Name(s) of the related party and nature of relationshipb) Nature of contracts arrangements transactionsc) Duration of the contracts arrangements transactionsd) Salient terms of the contracts or arrangements or transactions including the value if anye) Justification for entering into such contracts or arrangements or transactions NILf ) Date(s) of approval by the Boardg) Amount paid as advances if anyh) Date on which the special resolution was passed in general meeting as required under first proviso to Section 188
2 Details of material contracts or arrangement or transactions at arms length basis
a) Name(s) of the related party and nature of ITC Limited of which the Company is an Associaterelationship
b) Nature of contracts arrangements transactions Agreement for operating the Companyrsquos Hotel
c) Duration of the contracts arrangements Operating License Agreement (OLA) dated 24th September 1992 for an initialtransactions period of 30 years and renewable for another period of 30 years The OLA
emanated from the rehabilitation package agreed amongst Gujarat State GovtFinancial Institutions viz IFCI amp SBI and ITC in the year 1990
d) Salient terms of the contracts or arrangements The Company receives Licence fees 15 of Net Operating Income Valueor transactions including the value if any of transaction during the year ` 370 crores
e) Date(s) of approval by the Board if any 24th September 1992f ) Amount paid as advances if any Nil
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Annexure AToThe MembersGujarat Hotels Limited
Our report of even date is to be read along with this letter
1 Maintenance of secretarial record is the responsibilityof the management of the Company Our responsibilityis to express an opinion on these secretarial recordsbased on our audit
2 We have followed the audit practices and processesas were appropriate to obtain reasonable assuranceabout the correctness of the contents of the secretarialrecords The verification was done on the randomtest basis to ensure that correct facts are reflected insecretarial records We believe that the processesand practices we followed provide a reasonablebasis for our opinion
3 W e have not verified the correctness andappropriateness of financial records and books ofaccounts of the Company
4 W herever required we have obtained theManagement Representation about the complianceof Laws Rules and Regulations and happening ofevents etc
5 The compliance of the provisions of corporate andother applicable Laws Rules RegulationsStandards is the responsibility of management Ourexamination was limited to the verification ofprocedures on the random test basis
6 The Secretarial Audit Report is neither an assuranceas to the future viability of the Company nor of theefficacy or effectiveness with which the managementhas conducted the affairs of the Company
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
28
INDEPENDENT AUDITORSrsquo CERTIFICATE ON CORPORATE GOVERNANCE
INDEPENDENT AUDITORrsquoS CERTIFICATE ON CORPORATEGOVERNANCE
TO THE MEMBERS OF GUJARAT HOTELS LIMITED
1 We have examined the compliance of conditions ofCorporate Governance by Gujarat Hotels Limited (ldquotheCompanyrdquo) for the year ended on 31st March 2019as stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the Securities and Exchange Board ofIndia (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended(ldquoSEBI Listing Regulationsrdquo)
Managementrsquos Responsibility
2 The compliance of conditions of CorporateGovernance is the responsibility of the ManagementThis responsibility includes the designimplementation and maintenance of internal controland procedures to ensure the compliance with theconditions of the Corporate Governance stipulated inSEBI Listing Regulations
Auditorrsquos Responsibility
3 Our responsibility is limited to examining theprocedures and implementation thereof adopted bythe Company for ensuring the compliance of theconditions of the Corporate Governance It is neitheran audit nor an expression of opinion on the financialstatements of the Company
4 We have examined the books of account and otherrelevant records and documents maintained by theCompany for the purpose of providing reasonableassurance on the compliance with CorporateGovernance requirements by the Company
5 We have carried out an examination of the relevantrecords of the Company in accordance with theGuidance Note on Certification of CorporateGovernance issued by the Institute of CharteredAccountants of India (ldquothe ICAIrdquo) the Standards onAuditing specified under Section 143(10) of theCompanies Act 2013 in so far as applicable for the
purpose of this certificate and as per the GuidanceNote on Reports or Certificates for Special Purposesissued by the ICAI which requires that we comply withthe ethical requirements of the Code of Ethics issuedby the ICAI
6 W e have complied with the relevant applicablerequirements of the Standard on Quality Control (SQC)1 Quality Control for Firms that Perform Audits andReviews of Historical Financial Information and otherAssurance and Related Services Engagements
Opinion
7 Based on our examination of the relevant recordsand according to the information and explanationsprovided to us and representations provided by theManagement we certify that the Company hascomplied with the conditions of Corporate Governanceas stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the SEBI Listing Regulations asapplicable for the year ended 31st March 2019
8 W e state that such compliance is neither anassurance as to the future viability of the Companynor the efficiency or effectiveness with which theManagement has conducted the affairs of theCompany
Restrictions on Use
9 This Certificate is issued solely for the purpose ofcomplying with the aforesaid SEBI ListingRegulations and may not be suitable for any otherpurpose
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
29
ANNEXURE
FORM NO MGT-9EXTRACT OF ANNUAL RETURN
as on the Financial Year ended on 31st March 2019[Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the
Companies (Management and Administration) Rules 2014]
I REGISTRATION AND OTHER DETAILS
i) CIN L55100GJ1982PLC005408ii) Registration Date 7th August 1982iii) Name of the Company Gujarat Hotels Limitediv) Category Sub-Category of the Company Public company - Limited by sharesv) Address of the Registered office and contact details WelcomHotel Vadodara
R C Dutt Road AlkapuriVadodara 390 007Tel No 0265-233 0033E-mail ghlinvestorsyahoocoin
vi) Whether Listed Company Yesvii) Name Address and Contact details of MCS Share Transfer Agent Limited
Registrar and Transfer Agent if any F - 65 Okhla Industrial Area Phase - INew Delhi - 110 020Tel Nos (011) 4140 6149-52 4160 9386
II PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY
III PARTICULARS OF HOLDING SUBSIDIARY AND ASSOCIATE COMPANIES NIL
Sl No
Name and Description of main products services NIC Code of the products services
to total turnover of the Company
1 Hotel Services 55101 100
30
IV SHAREHOLDING PATTERN (Equity Share Capital Break-up as percentage of Total Equity)(i) Category-wise Shareholding
Category of Shareholders No of Shares held at the beginningof the year
No of Shares held at the endof the year
Changeduring the
year
A Promoters(1) Indiana) Individual HUF 0 0 0 0 0 0 0 0 0b) Central Govt 0 0 0 0 0 0 0 0 0c) State Govt(s) 0 0 0 0 0 0 0 0 0d) Bodies Corp 2033963 0 2033963 5370 2033963 0 2033963 5370 0e) Banks FI 0 0 0 0 0 0 0 0 0f ) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(1) 2033963 0 2033963 5370 2033963 0 2033963 5370 0(2) Foreigna) NRIs - Individuals 0 0 0 0 0 0 0 0 0b) Other - Individuals 0 0 0 0 0 0 0 0 0c) Bodies Corp 0 0 0 0 0 0 0 0 0d) Banks FI 0 0 0 0 0 0 0 0 0e) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(2) 0 0 0 0 0 0 0 0 0Total Shareholding of Promoter(A) = (A)(1)+(A)(2) 2033963 0 2033963 5370 2033963 0 2033963 5370 0B Public Shareholding1 Institutionsa) Mutual Funds 0 0 0 0 0 0 0 0 0b) Banks FI 0 100 100 0 100 100 c) Central Govt 0 0 0 0 0 0 0 0 0d) State Govt(s) 0 0 0 0 0 0 0 0 0e) Venture Capital Funds 0 0 0 0 0 0 0 0 0f ) Insurance Companies 0 0 0 0 0 0 0 0 0g) FIIs 10 0 10 0 0 0 h) Foreign Venture Capital Funds 0 0 0 0 0 0 0 0 0i) Others (specify) 0 0 0 0 0 0 0 0 0Sub-total (B)(1) 10 100 110 0 100 100 2 Non-Institutionsa) Bodies Corpi) Indian 300003 2200 302203 798 191626 2100 193726 511 (287)ii) Overseas 0 0 0 0 0 0 0 0 0b) Individualsi) Individual shareholders holding
nominal share capital upto` 1 lakh 774322 231562 1005884 2656 797094 203602 1000696 2643 (013)
ii) Individual shareholders holdingnominal share capital inexcess of ` 1 lakh 220814 0 220814 583 334765 0 334765 884 301
c) Others (specify)i) Non Resident Individuals 44288 71500 115788 306 45662 56700 102362 270 (036)ii) Investor Education and
Protection Fund AuthorityMinistry of Corporate Affairs 108753 0 108753 287 121903 0 121903 322 035
Sub-total (B)(2) 1448180 305262 1753442 4630 1491050 262402 1753452 4630 0Total Public Shareholding(B)=(B)(1)+ (B)(2) 1448190 305362 1753552 4630 1491050 262502 1753552 4630 0C Shares held by Custodian
for GDRs amp ADRs 0 0 0 0 0 0 0 0 0Grand Total (A+B+C) 3482153 305362 3787515 100 3525013 262502 3787515 100 0
Demat Physical Total of TotalShares
Demat Physical Total of TotalShares
ANNEXURE
31
1 Savi Portfolio Management Services LimitedAt the beginning of the year 122218 323Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 122218 323
2 Muktilal Ganulal PaldiwalAt the beginning of the year 82742 218Increase Decrease in Shareholding during the year06042018 220 001 82962 21913042018 250 001 83212 22001062018 927 002 84139 22215062018 700 002 84839 22427072018 412 001 85251 22505102018 1000 003 86251 22830112018 500 001 86751 22931122018 958 003 87709 23218012019 124 000 87833 23208022019 1070 003 88903 23501032019 467 001 89370 23615032019 1000 003 90370 23922032019 200 001 90570 24031032019 50 000 90620 240At the end of the year 90620 240
3 Taradevi Muktilal PaldiwalAt the beginning of the year 31628 084
(ii) Shareholding of Promoters (including Promoter Group)
(iii) Change in Promotersrsquo Shareholding (please specify if there is no change)
SlNo
Shareholders NameNo of
Shares of total
Sharesof the
Company
of Sharespledged
encumbered tototal Shares
No ofShares
of totalShares
of theCompany
of Sharespledged
encumbered tototal Shares
change inShareholding
during the year
1 ITC Limited 1733907 4578 Nil 1733907 4578 Nil Nil
2 Russell Investments Limited 300056 792 Nil 300056 792 Nil Nil
Shareholding at the beginning of the year Shareholding at the end of the year
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
(iv) Shareholding Pattern of top ten Shareholders (other than Directors Promoters and Holders of GDRs and ADRs)
ANNEXURE
No of Shares
Sl No
Particulars Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares of total Shares of the Company
No of Shares of total Shares of the Company
At the beginning of the year
No Change during the year Increase Decrease in Promoters Shareholding during the year
At the end of the year
32
Increase Decrease in Shareholding during the year06042018 180 000 31808 08413042018 53 000 31861 08420042018 1449 004 33310 08827042018 1933 005 35243 09304052018 1060 003 36303 09611052018 2196 006 38499 10218052018 1343 004 39842 10625052018 1191 003 41033 10906072018 1600 004 42633 11313072018 1678 004 44311 11720072018 2095 006 46406 12327072018 3735 010 50141 13303082018 415 001 50556 13410082018 685 002 51241 13624082018 1169 003 52410 13931082018 1616 004 54026 14307092018 1655 004 55681 14714092018 1311 003 56992 15021092018 2480 007 59472 15729092018 2259 006 61731 16305102018 1534 004 63265 16712102018 976 003 64241 17019102018 64 000 64305 17026102018 600 002 64905 17202112018 605 002 65510 17409112018 4 000 65514 17416112018 143 000 65657 17430112018 2299 006 67956 18007122018 515 001 68471 18114122018 10 000 68481 18121122018 590 002 69071 18331122018 600 002 69671 18504012019 1000 003 70671 18825012019 21 000 70692 18801022019 701 002 71393 19008022019 388 001 71781 19115022019 714 002 72495 19301032019 700 002 73195 19515032019 34 000 73229 195At the end of the year 73299 195
4 Shah Viren ShantilalAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 14122018 26965 071
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
ANNEXURE
33
Increase Decrease in Shareholding during theyear ie wef 1412201811012019 28946 076 55911 14701022019 7194 019 63105 166At the end of the year 63105 166
5 Chirayush Pravin VakilAt the beginning of the year 27482 073Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 27482 073
6 Falguni Nilesh DedhiaAt the beginning of the year 18000 048Increase Decrease in Shareholding during the year27042018 5175 014 23175 062At the end of the year 23175 062
7 Classic Realties Private LimitedAt the beginning of the year 23061 061Increase Decrease in Shareholding during the year31082018 100 000 23161 061At the end of the year 23161 061
8 Dheeraj Kumar LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 20000 053
9 Karvy Stock Broking LimitedAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 30112018 23063 061Increase Decrease in Shareholding during theyear ie wef 3011201807122018 149 000 23212 06114122018 (8165) (022) 15047 03931122018 7128 019 22175 05804012019 3087 008 25262 06611012019 (23721) (063) 1541 00331032019 15274 040 16815 043At the end of the year 16815 043 Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company Includes shares acquired during the period when not part of the top ten Shareholders of the Company
10 Sonal LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year20042018 (1000) (003) 19000 050
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
34
311218 0 000 0 00011012019 0 000 0 00031032019 (5000) (013) 14000 037At the end of the year 14000 037 Ceased to be part of the top ten Shareholders of the Company Became a part of the top ten Shareholders of the Company
11 Rajasthan Global Securities Private LimitedAt the beginning of the year 98659 260Increase Decrease in Shareholding during the year20042018 (4756) (013) 93903 24727042018 (5596) (015) 88307 23206072018 (790) (002) 87517 23027072018 (8520) (022) 78997 20802112018 (10975) (029) 68022 17916112018 (4) 000 68018 17930112018 (6189) (016) 61829 16307122018 (170) 000 61659 16314122018 (18503) (049) 43156 11421122018 (417) (001) 42739 11331122018 (11108) (029) 31631 08404012019 (5000) (013) 26631 07111012019 (5000) (013) 21631 05825012019 (2800) (007) 18831 05101022019 0 000 0 000At the end of the year NA NA Ceased to be a part of the top ten Shareholders of the Company
12 Dinesh Mukilal PaldiwalAt the beginning of the year 10522 028Increase Decrease in Shareholding during the year03082018 112 000 10634 02810082018 424 001 11058 02907092018 500 001 11558 03021092018 85 000 11643 03005102018 1000 003 12643 03302112018 0 000 12643 03301022019 0 000 12643 03315022019 300 001 12943 03431032019 0 000 12943 034At the end of the year NA NA Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company
Note Increase decrease in shareholding as indicated above are based on downloads of beneficial ownership provided by the Depositories generally everyFriday
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
35
(v) Shareholding of Directors and Key Managerial Personnel
ANNEXURE
Ms D R Choudhury Messrs C K Koshy R C Mehta M Narayanan and J Singh Directors Messrs M Agarwal andD K Gulati Key Managerial Personnel did not hold any Shares of the Company either at the beginning or at the end of theyear or at any time during the year
Mr K Pahwa Chief Executive Officer also did not hold any Shares of the Company either at the time of his appointment or atthe end of the year or at any time during the year
V INDEBTEDNESSIndebtedness of the Company including interest outstanding accrued but not due for payment NIL
VI REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNELA Remuneration to Managing Director Wholetime Directors and or Manager NOT APPLICABLE
B Remuneration to the other Directors(Amount in `)
Ceased to be Non-Executive Independent Director with close of work on 31st March 2019
Sl No For each of the Director
Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares held singly
jointly
of total Shares of the
Company
No of Shares held singly
jointly
of total Shares of the
Company
1 N Anand (Chairman)
At the beginning of the year 200 0
Increase Decrease in Shareholding during the year
0 0 0 0
At the end of the year 200 0
Sl No Directors
Particulars of Remuneration
Total Amount Fee for attending Board Board
Committee Meetings
Commission Independent Directors
Meeting Fees 1 Independent Directors
C K Koshy 140000 0 10000 150000 R C Mehta 70000 0 0 70000 M Narayanan 140000 0 10000 150000
Total (B)(1) 350000 0 20000 370000 2 Other Non-Executive Directors
N Anand 0 0 0 0 D R Choudhury 0 0 0 0 J Singh 0 0 0 0
Total (B)(2) 0 0 0 0 Total (B) = (B)(1) + (B)(2) 370000 Total Managerial Remuneration (A+B) 370000
Overall ceiling as per the Act (Being 11 of the Net Profits of the Company as calculated under Section 198 of the Companies Act 2013)
3759620
36
C Remuneration to Key Managerial Personnel other than MD Manager WTD(Amount in `)
Mr K Pahwa was appointed as Chief Executive Officer wef 1st February 2019
VII PENALTIES PUNISHMENT COMPOUNDING OF OFFENCES
against the Company Directors and other Officers in Default under the Companies Act 2013 NONE
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Sl No
Particulars of Remuneration Key Managerial Personnel
Total Amount
K Pahwa Chief Executive
Officer
M Agarwal Chief Financial
Officer
D K Gulati Company Secretary
1 Gross Salary
(a) Salary as per provisions contained in Section 17(1) of the Income-tax Act 1961
377472 2883242 880140 4140854
(b) Value of perquisites under Section 17(2) of the Income-tax Act 1961
242908 136154 0 379062
(c) Profits in lieu of salary under Section 17(3) of the Income-tax Act 1961
0 0 0 0
2 Stock Option 0 0 0 0 3 Sweat Equity 0 0 0 0 4 Commission
- as of profit - others specify
0 0 0 0
5 Others please specify 0 0 0 0 Total Amount 620380 3019396 880140 4519916
37
Services reverted to ITC Limited effective 17th December 2018 Reflects revision in remuneration effective 1st October 2018
Notes1 The number of permanent employees as on 31st March 2019 was 1982 Compared to 2017-18 the figures for 2018-19 reflect that
i) Median remuneration of employees - Increased by 965ii) Average remuneration of employees excluding Key Managerial Personnel (KMP) - Increased by 1040 with
increase in number of employeesiii) Remuneration of KMP - Increased by 1321 due to revision in remuneration during the year
3 Remuneration of Directors KMP and other employees is in accordance with the Companys Remuneration Policy
A Information pursuant to Section 197 of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014
Name of Directors ampKey ManagerialPersonnel
Designation Ratio of Remuneration toMedian Remuneration of
all employees
Increase inRemuneration over
LY ()
ANNEXURE
N Anand Non-Executive Chairman - -
D R Choudhury Non-Executive Director - -
C K Koshy Independent Director 0731 7
R C Mehta Independent Director 0341 -
M Narayanan Independent Director 0731 7
J Singh Non-Executive Director - -
D Rana Chief Executive Officer 12681 (15)
K Pahwa Chief Executive Officer (wef 1st February 2019) 3111 -
M Agarwal Chief Financial Officer 15281 24
D K Gulati Company Secretary 4371 8
38
O
n de
puta
tion
from
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ited
(ITC
)
Ser
vice
s re
verte
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ITC
effe
ctiv
e 17
th D
ecem
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otes
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Gro
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emun
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incl
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tribu
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n an
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Com
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bas
is
The
ter
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ning
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e ne
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Dire
ctor
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ny
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n 19
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ct 2
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ules
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rd
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ce
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ingh
Dat
e 1
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il 2
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Dire
ctor
Dire
ctor
Desig
natio
nGr
oss
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n(`
)
Net
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n(`
)
Quali
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Date
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Em
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t Po
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n He
ld
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)Na
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Top
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l Man
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etary
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ligar
e Sec
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ited
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ompli
ance
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an Ja
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ajan
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t Man
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8164
6118
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A P
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e Fer
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l(M
arke
ting)
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ager
Kuna
l Pah
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ffice A
ssist
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am K
ashir
am B
abar
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m
2201
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r Ex
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er
INFORMATION US 197 OF THE COMPANIES ACT 2013
39
CEO AND CFO COMPLIANCE CERTIFICATE
We Kunal Pahwa Chief Executive Officer and Mayur Agarwal Chief Financial Officer certify that
a) We have reviewed the financial statements including the cash flow statement for the year ended 31st March 2019 andto the best of our knowledge and belief
i) these statements do not contain any materially untrue statement or omit any material fact or contain statementsthat might be misleading
ii) these statements together present a true and fair view of the Companyrsquos affairs and are in compliance with IndianAccounting Standards applicable laws and regulations
b) To the best of our knowledge and belief no transactions entered into by the Company during the year ended31st March 2019 are fraudulent illegal or violative of the Companyrsquos code of conduct
c) We accept responsibility for establishing and maintaining internal controls for financial reporting and we have evaluatedthe effectiveness of the internal control systems of the Company pertaining to financial reporting Deficiencies in thedesign or operation of such internal controls if any of which we are aware have been disclosed to the auditors and theAudit Committee and steps have been taken to rectify these deficiencies
d) i) There has not been any significant change in internal control over financial reporting during the year underreference
ii) The changes in the Significant Accounting Policies arising from the adoption of the Indian Accounting Standardshave been discussed with the auditors and have been approved by the Audit Committee and
iii) We are not aware of any instance during the year of significant fraud with involvement therein of the managementor any employee having a significant role in the Companyrsquos internal control system over financial reporting
Place New Delhi Kunal Pahwa Mayur AgarwalDate 15th April 2019 Chief Executive Officer Chief Financial Officer
40
BALANCE SHEET
As at 31st March 2019Amount in `
Particulars Note As at As at31st March 2019 31st March 2018
ASSETSNon-Current Assetsa) Property Plant and Equipment 2 14695652 15623727b) Other Non-Current Assets 3 6672434 7609451Total Non-Current Assets 21368086 23233178Current Assetsa) Financial Assets
(i) Investments 4 280294894 208482957(ii) Trade Receivables 5 16310661 14154244(iii) Cash and Cash Equivalents 6 763039 900355(iv) Other Bank Balances 7 5489856 53182631(v) Other Financial Assets 8 4724316 6349124
b) Other Current Assets 3 437564 406324Total Current Assets 308020330 283475635Total Assets 329388416 306708813EQUITY AND LIABILITIESEquitya) Equity Share Capital 9 37875150 37875150b) Other Equity 268275037 243468594Total Equity 306150187 281343744LIABILITIESNon-Current Liabilitiesa) Provisions 10 1399224 1270990b) Deferred Tax Liabilities (Net) 11 10745247 11364002Total Non-Current Liabilities 12144471 12634992Current Liabilitiesa) Financial Liabilities
(i) Trade Payablesa) Total outstanding dues of micro enterprises and
small enterprises ndash ndashb) Total outstanding dues of creditors other than
micro enterprises and small enterprises 483074 395920(ii) Other Financial Liabilities 12 9272344 11118126
b) Other Current Liabilities 13 1264039 1172866c) Provisions 10 74301 43165Total Current Liabilities 11093758 12730077Total Equity And Liabilities 329388416 306708813
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
41
STATEMENT OF PROFIT AND LOSS
For the year ended 31st March 2019Amount in `
I Revenue From Operations 14 36986948 33098499
II Other Income 15 19625544 17119109
III Total Income (I+II) 56612492 50217608
IV EXPENSES
Employee Benefits Expense 16 1208580 1094609
Depreciation and Amortization Expense 473636 475984
Other Expenses 17 3107913 3334087
Total Expenses (IV) 4790129 4904680
V Profit Before Tax (III- IV) 51822363 45312928
VI Tax Expense
Current Tax 18 11653499 9272310
Deferred Tax 18 (618755) 2350502
VII Profit for the Year (V-VI) 40787619 33690116
VIII Other Comprehensive Income ndash ndash
IX Total Comprehensive Income for the Year (VII+VIII) 40787619 33690116
X Earnings per Equity Share (Face Value ` 10-each) 19
Basic (in `) 1077 890
Diluted (in `) 1077 890
For the Year For the YearParticulars Note ended ended
31st March 2019 31st March 2018
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
42
For the year ended 31st March 2019
STATEMENT OF CHANGES IN EQUITY
The Board of Directors of the Company recommended a dividend of ` 35 per share (for the year ended 31st March 2018 - dividend ` 350 pershare) be paid on fully paid equity shares This equity dividend is subject to approval by shareholders at the Annual General MeetingThe totalequity dividend to be paid ` 13256303 (for the year ended 31st March 2018 - dividend ` 13256303) Income tax on proposed dividend being` 2724873 (for the year ended 31st March 2018 - ` 2724873)
General Reserve This Reserve is created by an appropriation from one component of equity (generally retained earnings) to another notbeing an item of Other Comprehensive Income The same can be utilized by the Company in accordance with the provisions of the CompaniesAct 2013
Retained Earnings This Reserve represents the cumulative profits of the Company This Reserve can be utilized in accordance with theprovisions of the Companies Act 2013
The accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even dateOn behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
A Equity Share CapitalAmount in `
Balance as at the Changes in equity Balance at thebeginning of the share capital end of the
reporting year during the year reporting yearFor the year ended 31st March 2018 37875150 ndash 37875150For the year ended 31st March 2019 37875150 ndash 37875150
B Other EquityAmount in `
Reserves amp Surplus TotalGeneral Reserve Retained Earnings
Balance as at April 01 2017 30257504 195873461 226130965Total Comprehensive Income for the year ndash 33690116 33690116Dividend ndash 13256303 13256303Income Tax on Dividend Paid ndash 2698671 2698671Dividend Distribution Tax (earlier year) ndash 397513 397513Balance as at March 31 2018 30257504 213211090 243468594Balance as at April 01 2018 30257504 213211090 243468594Total Comprehensive Income for the year ndash 40787619 40787619Dividend ndash 13256303 13256303Income Tax on Dividend Paid 2724873 2724873Balance as at March 31 2019 30257504 238017533 268275037
43
CASH FLOW STATEMENT
For the year ended 31st March 2019
For the Year For the YearParticulars ended ended
31st March 2019 31st March 2018
NOTES1) The above Cash Flow Statement has been prepared under the ldquoIndirect Methodrdquo as set out in Ind AS 7Statement of Cash FlowsrdquoThe accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even date On behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
Amount in `
A Cash Flow from Operating ActivitiesPROFIT BEFORE TAX 51822363 45312928Adjustments for
Depreciation amp Amortisation expense 473636 475984Interest Income (1317822) (3453950)Dividend Income (159984) (178075)Loss on sale of property plant and equipment - Net 445778 (28273)Net gain(loss) on investments mandatorily measuredat fair value through profit or loss (18005340) (13358789)Other Non Operating Income ndash (86856)Other Non Operating Expense ndash 99378
OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 33258631 28782347Adjustments for
Trade Receivables Financial Assets and Other Assets (2815198) (90661)Trade Payables Other Liabilities and Provisions (1568800) 1700052
CASH GENERATED FROM OPERATIONS 28874633 30391738Income Tax Paid(Net) (10407981) (12740273)
NET CASH FROM OPERATING ACTIVITIES 18466652 17651465B Cash Flow from Investing Activities
Sale of Property Plant and Equipment 8661 58452Purchase of Current Investments (224340000) (186220000)SaleRedemption of Current Investments 170532754 183295529Dividend Income 159984 178075Interest Received 3262318 4031382
NET CASH FROM INVESTING ACTIVITIES (50376283) 1343438C Cash Flow from Financing Activities
Dividend Paid (13256303) (13256303)Income Tax on Dividend Paid (2724873) (2698671)
NET CASH FROM FINANCING ACTIVITIES (15981176) (15954974)NET INCREASE IN CASH AND CASH EQUIVALENTS (47890807) 3039929OPENING CASH AND CASH EQUIVALENTS 48653846 45613917CLOSING CASH AND CASH EQUIVALENTS 763039 48653846
CASH AND CASH EQUIVALENTS COMPRISE Cash cheques and current accounts 763039 900355Other Bank BalancesDeposits with original maturity more than 3 months having remainingmaturity less than 12 months from Balance Sheet date ndash 47753491
763039 48653846
44
1 SIGNIFICANT ACCOUNTING POLICIESStatement of ComplianceThese financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) notifiedunder section 133 of the Companies Act 2013 (the Act) read with Companies (Indian Accounting Standards)Rules 2015 (as amended) The financial statements have also been prepared in accordance with the relevantpresentation requirements of the Companies Act 2013
Basis of PreparationThe financial statements are prepared in accordance with the historical cost convention except for certain itemsthat are measured at fair values as explained in the accounting policies below The financial statements arepresented in Indian Rupees (INR) which is also the Companyrsquos functional currency
Fair Value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transactionbetween market participants at the measurement date regardless of whether that price is directly observable orestimated using another valuation technique In estimating the fair value of an asset or a liability the Companytakes into account the characteristics of the asset or liability if market participants would take those characteristicsinto account when pricing the asset or liability at the measurement date
The preparation of financial statements in conformity with Ind AS requires management to make judgementsestimates and assumptions that affect the application of the accounting policies and the reported amounts ofassets and liabilities the disclosure of contingent assets and liabilities at the date of the financial statementsand the reported amounts of revenues and expenses during the year Actual results could differ from those estimatesThe estimates and underlying assumptions are reviewed on an ongoing basis Revisions to accounting estimatesare recognised in the period in which the estimate is revised if the revision affects only that period they arerecognised in the period of the revision and future periods if the revision affects both current and future periods
All assets and liabilities have been classified as current or non-current as per the Companyrsquos normal operatingcycle and other criteria set out in the Schedule III to the Companies Act 2013 and Ind AS 1 ndash Presentation ofFinancial Statements based on the nature of business and the time between the acquisition of assets for processingand their realisation in cash and cash equivalents
Property Plant amp Equipment ndash Tangible AssetsProperty plant amp equipment are stated at cost of acquisition or construction less accumulated depreciation andimpairment if any For this purpose cost includes deemed cost which represents the carrying value of propertyplant and equipment recognised as at 1st April 2015 measured as per the previous GAAP
Cost is inclusive of inward freight duties and taxes and incidental expenses related to acquisition In respect ofmajor projects involving construction related pre-operational expenses form part of the value of assets capitalisedExpenses capitalised also include applicable borrowing costs for qualifying assets if any Subsequent costs areincluded in the assetrsquos carrying amount only when it meets the recognition criteria are met as per componentaccounting The carrying amount of a replaced part is derecognized All other repairs and maintenance are chargedto the statement of Profit amp Loss
An item of property plant and equipment is derecognized upon disposal or when no future economic benefits areexpected to arise from the continued use of asset Any gain or loss arising on the disposal or retirement of an itemof property plant and equipment is determined as the difference between the sales proceeds and the carryingamount of the asset and is recognised in Statement of Profit and Loss
Depreciation of these assets commences when the assets are ready for their intended use which is generally oncommissioning Items of Property Plant and Equipment are depreciated in a manner that depreciates the cost ofthe assets after commissioning (or other amount substituted for cost) less its residual value over their usefullives as specified in Schedule II of the Companies Act 2013 on a straight line basis
Property plant and equipmentrsquosrsquo residual values and useful lives are reviewed at each balance sheet date andchanges if any are treated as changes in accounting estimate
NOTES TO THE FINANCIAL STATEMENTS
45
NOTES TO THE FINANCIAL STATEMENTS
Useful lives of different class of PPE are as follows
Particulars Useful Life as per Schedule IIBuilding 60 Years
Plant and Equipment 15 Years
Furnitures and fixtures 8 years
Office equipment 5 Years
Impairment of AssetsImpairment loss is provided if any to the extent the carrying amount of assets or cash generating units exceedtheir recoverable amount
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amountmay not be recoverable
Recoverable amount is higher of an assetrsquos net selling price and its value in use Value in use is the present valueof estimated future cash flows expected to arise from the continuing use of an asset or cash generating unit andfrom its disposal at the end of its useful life
Impairment losses recognised in prior years are reversed when there is an indication that the impairment lossesrecognised no longer exist or have decreased Such reversals are recognised as an increase in carrying amountsof assets to the extent that it does not exceed the carrying amounts that would have been determined (net ofamortisation or depreciation) had no impairment loss been recognised in previous years
Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodiedin the asset are considered to modify the amortisation period or method as appropriate and are treated aschanges in accounting estimates
Financial instruments Financial Assets and Financial LiabilitiesFinancial assets and financial liabilities are recognized when the Company becomes a party to the contractualprovisions of the relevant instrument Transaction cost that are directly attributable to the acquisition or issue offinancial assets and financial liabilities (other than financial assets and financial liabilities measured at fair valuethrough profit or loss) are added to or deducted from the fair value on initial recognition of financial assets andfinancial liabilities Purchase or sale of financial assets that require delivery of assets within a time frame establishedby regulation or convention in the market place (regular way trades) are recognized on the trade date ie the datewhen the Company commits to purchase or sell the asset
Financial AssetsRecognition Financial assets includes Investments Trade receivable Advances Security Deposits Cash andcash equivalents Such Assets are initially recognized at transaction price when the company becomes party tocontractual obligations The transaction price includes transaction cost unless the assets is being fair valuedthrough the Statement of Profit and Loss
Classification Management determines the classification of an asset at initial recognition depending on thepurpose for which the assets were acquired The subsequent measurement of financial assets depends on suchclassification
Financial assets are classified as those measured at
(a) Amortised cost where the financial assets are held solely for collection of cash flows arising from payments ofprincipal and or interest
(b) Fair value through other comprehensive income (FVTOCI) where the financial assets are held not only forcollection of cash flows arising from payments of principal and interest but also from the sale of such assetsSuch assets are subsequently measured at fair value with unrealised gains and losses arising from changesin the fair value being recognised in other comprehensive income
46
NOTES TO THE FINANCIAL STATEMENTS
(c) Fair value through profit or loss (FVTPL) where the assets are managed in accordance with an approvedinvestment strategy that triggers purchase and sale decision based on fair value of such assets Such assetsare subsequently measured at fair value with unrealized gain and losses arising from changes in the fair valuebeing recognised in the Statement of Profit and Loss in the period in which they arise
Trade receivable Advances Security Deposits Cash and Cash equivalents etc are classified for measurementat amortised cost while Investment have been classified for measurement at Fair value through profit or loss(FVTPL)
Impairment The Company assesses at each reporting date whether a financial asset (or group of financialassets) such as investment trade receivable advances and security deposit held at amortised cost are tested forimpairment based on evidence or information that is available without undue cost or effort Expected credit lossesare assessed and loss allowances recognized if the credit quality of the financial asset has deteriorated significantlysince initial recognition
Reclassification When and only when the business model is changed the Company shall reclassify all affectedfinancial assets prospectively from the reclassification date as subsequently measured at amortised cost fairvalue through profit or loss without restating the previously recognized gains or losses and in terms of thereclassification principles laid down in the Ind AS relating to Financial Instruments
De-recognition Financial assets are derecognized when the rights to receive benefits have expired or beentransferred and the Company has transferred substantially all risks and rewards of ownership of such financialasset
Financial LiabilitiesTrade payables and other financial liabilities are initially recognized at the value of the respective contractualobligations They are subsequently measured at amortised cost
Financial liabilities are derecognized when the liability is extinguished that is when the contractual obligation isdischarged cancelled or expires
Offsetting Financial InstrumentsFinancial assets and liabilities are offset and the net amount is included in the Balance Sheet where there is alegally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis orrealise the asset and settle the liability simultaneously
Revenue1 Revenue is measured at the fair value of the consideration received or receivable for services rendered net of
discounts to customers and excludes taxes such as Goods and Services Tax Revenue from the sale ofservices is recognised when the Company performs its obligations to its customers and the amount of revenuecan be measured reliably and recovery of the consideration is probable Income from operating license fees arerecognized on accrual basis in accordance with Operating License agreement The timing of such revenuerecognition is in the periods in which such services are rendered
2 Interest Income is booked in the Statement of Profit and Loss using the effective interest method
3 Dividend Income is recognised in the Statement of Profit and Loss when the right to receive dividend is established
Employee BenefitsThe Company makes contributions to both defined benefit and defined contribution schemes
Contributions to Provident Fund are in the nature of defined contribution scheme and such paidpayable amountsare charged against revenue The contributions in respect of provident fund and family pension are statutorilydeposited with the Government
The Company also makes contribution to defined benefit gratuity plan The cost of providing benefits under thedefined benefit obligation is calculated by independent actuary using the projected unit credit method The Companyhas taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liability with respect to the
47
NOTES TO THE FINANCIAL STATEMENTS
employees and the premium paid to LIC is charged to Statement of Profit amp Loss The difference between theactuarial valuation of the gratuity with respect to employees at the year-end and the contribution paid to LIC isfurther adjusted in the books of accounts
Employees Benefit wrt Leave Encashment is considered as Employees Long Term Benefit for which the Companyrecords the liability based on actuarial valuation computed under projected unit credit method These benefits areunfunded
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee as per the Operating LicenseAgreement
Taxes on IncomeTaxes on income comprises of current tax and deferred tax Current tax in the Statement of Profit and Loss isprovided as the amount of tax payable in respect of taxable income for the period using tax rates and tax lawsenacted during the period together with any adjustment to tax payable in respect of previous years
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities andthe amounts used for taxation purposes (tax base) at the tax rates and tax laws enacted or substantively enactedby the end of the reporting period
Deferred tax assets are recognized for the future tax consequences to the extent it is probable that future taxableprofits will be available against which the deductible temporary differences can be utilized
Deferred tax assets and liabilities are offset when there is legally enforceable right to offset current tax assets andliabilities and when the deferred tax balances relate to the same taxation authority Current tax assets and taxliabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on netbasis or to realize the asset and settle the liability simultaneously
Dividend DistributionDividends paid (including income tax thereon) is recognised in the financial statements in the period in which inwhich the interim dividends are approved by the Board of Directors or in respect of the Companyrsquos final dividendfor the year when the same are approved by shareholders of the Company
Provisions and Contingent LiabilitiesProvisions are recognized when the Company has a present obligation (legal or constructive) as a result of a pastevent it is probable that an outflow of resources will be required to settle the obligation and the amount can bereliably estimated The amount so recognized is the best estimate of the consideration required to settle theobligation at the reporting date taking in to account the risks and uncertainties surrounding the obligation Adisclosure for a contingent liability is made when there is possible obligation or a present obligation that may butprobably will not require an outflow of resources Where there is possible obligation or a present obligation inrespect of which the likelihood of outflow of resources is remote no provision or disclosure is made
Use of Estimates and JudgementsThe key estimates and assumption used in the preparation of financial statements are set out below
Actuarial ValuationThe determination of Companyrsquos liability towards defined benefit obligation to employees is made through independentactuarial valuation including determination of amounts to be recognized in the Statement of Profit and Loss and inother comprehensive income Such valuation depend upon assumptions determined after taking into accountinflation seniority promotion and other relevant factors such as supply and demand factors in the employmentmarket Information about such valuation is provided in notes to the financial statements
ComparativesWhen required by Ind AS comparative figures have been adjusted to conform to changes in presentation for thecurrent financial year
48
2P
rope
rty
Pla
nt a
nd E
quip
men
tA
mou
nt i
n `
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
Gros
s Bl
ock
Depr
eciat
on
Amor
tisati
onNe
t Blo
ck
Parti
cula
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thdraw
alWi
thdraw
alWi
thdraw
alWi
thdraw
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ril 1
and
Marc
h 31
an
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rch
31
April
1Fo
r the
and
March
31
For t
hean
dMa
rch
31
Marc
h 31
Ma
rch
31
2017
Addi
tions
Adjus
tmen
t20
18Ad
ditio
nsAd
justm
ent
2019
2017
year
Adjus
tmen
t20
18ye
arAd
justm
ent
2019
2019
2018
Tang
ible
Ass
ets
Build
ing
161
88
565
-16
188
565
-2
668
831
592
168
29
561
564
759
84-1
432
140
473
636
290
5518
76
721
140
44
961
147
56
425
Plan
t and
Equ
ipmen
t7
637
0120
716
742
985
-2
047
935
381
92-
--
--
--
538
192
742
985
Furn
iture
and
Fixt
ures
1
278
845
584
122
300
-11
818
110
482
--
--
--
-1
104
821
223
00
Offic
e Eq
uipme
nt2
017
-2
017
--
201
7-
--
--
--
201
72
017
Tota
l1
708
216
7-
263
001
705
586
7-
483
494
165
72
373
956
156
475
984
-14
321
404
736
3629
055
187
672
11
469
565
21
562
372
7
Full
y de
prec
iated
ass
ets
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
49
NOTES TO THE FINANCIAL STATEMENTS
Amount in `Particulars As at 31st March 2019 As at 31st March 2018
Current Non-Current Current Non-Current3 OTHER ASSETS
Advances other than capital advancesSecurity Deposit- With Others 2328947 2328947- Statutory Authorities 200000Other Advances (prepaid expenses) 437564 ndash 406324 ndashAdvance Tax (Net of Provisions) 4143487 5280504TOTAL 437564 6672434 406324 7609451
4 Current investments (at fair value through profit or loss unless otherwise stated) Amount in `Sl Investments in Mutual Funds As at 31st March 2019 As at 31st March 2018No
Name of Plan Unquoted Unquoted1 DHFL Pramerica Ultra Short Term Fund Nil (2018 - 1040731248)
Units of ` 1000 each ndash 219455882 ICICI Prudential Banking amp PSU Debt Fund 1124750948 Units
(2018 - 1124750948) of ` 1000 each 23872614 224702743 ICICI Prudential Corporate Bond Fund 1241451718 Units
(2018 - 1241451718) of ` 1000 each 23712100 221226704 UTI Floating Rate Fund Short Term Fund 7749911 Units
(2018-7749911) of ` 100000 each 23474167 218899535 SBI Magnum Instacash Nil Units (2018-3177849) of ` 100000 each ndash 70220186 Aditya Birla Sun Life Floating Rate Fund-Long Term 274475933 Units
(2018-319824542) Units of ` 10000 each 63614941 686675207 Aditya Birla Sunlife Saving Fund 137924934 Units (2018-129174683)
Units of ` 10000 each 51171946 443649348 Kotak Savings Fund 1128273230 Units (2018-Nil) of ` 1000 each 33816154 ndash9 Reliance Liquid Fund 11416769 Units (2018- Nil) of ` 100000 each 51823115 ndash10 ICICI Prudential Liquid Fund 57413509 Units (2018- Nil) of ` 10000 each 8809857 ndash
Aggregate amount of unquoted Investments 280294894 208482957TOTAL 280294894 208482957
Amount in `As at As at
31st March 2019 31st March 20185 TRADE RECEIVABLES
Unsecured Considered Good 16310661 14154244TOTAL 16310661 14154244
6 CASH AND CASH EQUIVALENTS Balances with Banks
Current Accounts 760024 900355Cash on Hand 3015 ndashTOTAL 763039 900355 Cash and cash equivalents include cash on hand cheques drafts on hand cash at bank and deposits with banks with original maturityof 3 months or less
7 OTHER BANKS BALANCESEarmarked balances 5489856 5429140On Deposit Accounts ndash 47753491TOTAL 5489856 53182631
Represents deposits with original maturity of more than 3 months having remaining maturity of less than 12 months from the Balance Sheet date
50
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
8 OTHER FINANCIAL ASSETSInterest accrued on Deposits 158000 2210348Others - Unsecured considered good 4566316 4138776TOTAL 4724316 6349124
As at As at As at As at31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of ` (No of `
Shares) Shares)9 EQUITY SHARE CAPITAL
AuthorisedEquity Shares of ` 10- each 10000000 100000000 10000000 100000000Issued Subscribed and Paid upEquity Shares of ` 10- each fully paid 3787515 37875150 3787515 37875150
A) Reconciliation of the number of Equity Shares outstanding31st March 31st March
2019 2018As at the beginning of the year 3787515 3787515Add - Shares issued during the year ndash ndashLess -Shares bought back during the year ndash ndashAs at the end of the year 3787515 3787515
B) Shareholders holding more than 5 of the As at As at As at As atEquity Shares in the Company 31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of (No of
Shares) Shares)ITC Limited 1733907 4578 1733907 4578Russell Investments Limited 300056 792 300056 792
C) Rights Preferences and Restrictions attached to the Equity SharesThe Equity Shares of the Company having par value of ` 10 per share rank pari passu in all respects includingvoting rights and entitlement to dividend
D) There are no bonus issue or buy back of equity shares during the period of five years immediately preceding thereporting date
As at 31st March 2019 As at 31st March 2018Current Non-Current Current Non-Current
10 PROVISIONSProvision for Long Term Employee Benefits 74301 1399224 43165 1270990TOTAL 74301 1399224 43165 1270990
51
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
11 DEFERRED TAX LIABILITIES (NET)Deferred Tax Liabilities 10745247 11364002Total 10745247 11364002Movement in Deferred Tax LiabilitiesAssets Balances
For the year 2018-19 Balance as on Recognized in Balance as on1st April 2018 profit or loss 31st March 2019
Deferred Tax Liabilities in relation toOther timing differences
On Depreciation on PPE 4293876 (252926) 4040950On Gain on Investment at FVTPL 7070126 473819 7543945
Total Deferred Tax Liabilities 11364002 220893 11584895Deferred tax liabilities beforeMAT credit entitlement 11364002 220893 11584895Less MAT credit entitlement ndash 839648 839648Total Deferred Tax Liabilities (Net) 11364002 (618755) 10745247
For the year 2017-18 Balance as on Recognized in Balance as on1st April 2017 profit or loss 31st March 2018
Deferred Tax liabilitiesassets in relation toOther timing differences
On Depreciation on PPE 4383618 (89742) 4293876On Gain on Investment at FVTPL 4629882 2440244 7070126
Total Deferred Tax Liabilities (Net) 9013500 2350502 11364002
As at As at31st March 2019 31st March 2018
12 OTHER FINANCIAL LIABILITIES
Unpaid Dividend 5489856 5429140Employee Related 3782488 5688986TOTAL 9272344 11118126
13 OTHER CURRENT LIABILITIES
Statutory Liabilities 1264039 1172866TOTAL 1264039 1172866
52
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 201814 REVENUE FROM OPERATIONS
Operating License Fees 36986948 33098499TOTAL 36986948 33098499
15 OTHER INCOMEInterest Income- Deposit with Banks- Carried At Amortised Cost 1178600 3272160- Deposit Others 139222 181790Dividend Income on Investment measured at FVTPL 159984 178075Net Gain(Loss) on financial assets mandatorily measured at FVTPL 18005340 13358789Net Gain(Loss) on Disposal of Fixed Assets ndash 28273Other Non-Operating Income 142398 100022TOTAL 19625544 17119109
Includes 1120976- (2018 - 681882-) being net gain(loss) on sale of investments
16 EMPLOYEE BENEFITS EXPENSESalaries and Wages 42461991 38590070Contribution to Provident and Other Fund 4564892 3983444
47026883 42573514Less Recoveries madeReimbursements received (45818303) (41478905)TOTAL 1208580 1094609
17 OTHER EXPENSESAdvertising Sales Promotion 159768 158814Consultancy Professional fees 214842 253969Travelling amp Conveyance 810746 1096527Postage Telephone Stationery etc 366042 205049Miscellaneous Expenses 1556515 1619728TOTAL 3107913 3334087Miscellaneous expenses includes Auditors remuneration andexpenses Audit Fees 60000 60000Fees for other services 40000 ndash
18 INCOME TAX EXPENSESA Amount recognised in profit or loss
Current TaxIncome Tax for the Year 11504441 9481109Adjustments(Credits) related to previous year 149058 (208799)Total Current Tax 11653499 9272310Deferred TaxDeferred tax for the year 220893 2350502Mat Credit Entitlement (839648) ndashTotal Deferred Tax (618755) 2350502TOTAL 11034744 11622812
NOTES TO THE FINANCIAL STATEMENTSAmount in `
53
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 2018B Reconciliation of effective tax rate
Profit before tax 51822363 45312928Indian tax rate 2782 2755Income Tax expense calculated at 2782 (2018 2755) 14416981 12484845Effects ofndash Different tax rate on certain items (2922098) (756048)ndash Difference in taxable incomedeductible expense 9697 42609ndash Incomes that are not taxable in determining taxable profit (44508) (49064)Adjustments recognised in the current year in relation toCurrent tax of prior years (425328) (208799)Effect on deferred tax balances due to the change in income tax rate ndash 109269Income Tax recognised in profit or loss 11034744 11622812
The tax rate used for the year 2018-19 and 2017-18 reconciliations above is the corporate tax rate of 25 + surcharge 7 and education cess 4 (2017-18 3) payable on taxable profits under the Income Tax Act 1961
19 EARNINGS PER EQUITY SHAREProfit for the year 40787619 33690116Number of equity shares outstanding 3787515 3787515Basic and diluted earnings per share in (Face value ` 10- per share) 1077 890
20 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTSA The Company was allotted 8200 sq mtrs of land at Vadodara in 1984 and an additional land of 2548 sq mtrs
in 1988 at R C Dutt Road Alkapuri Vadodara through GIIC (Gujarat Industrial Investment Corporation) on sub-lease for a period 30 years on which the hotel Welcomhotel Vadodara was constructed Lease term of landadmeasuring 8200 Sq mtrs expired on 30092014 and of land admeasuring 2548 sq mtrs expired on 30112018
The High Court of Gujarat in pursuance of Writ petition filed by Company in April 2013 passed an Order onDecember 24 2014 restraining the State Government from disturbing the peaceful and actual possession ofthe Company over the hotel property in any manner The writ petition is pending for hearing
The Company have made necessary application to State Government for Conversion of land from Leasehold toFreehold or Extension of Lease which is in process
B There are no Micro Small and Medium Enterprises to whom the Company owes dues which are outstandingfor more than 45 days during the year and also as at 31st March 2019 This information as required to bedisclosed under the Micro Small and Medium Enterprises Development Act 2006 has been determined tothe extent such parties have been identified on the basis of information available with the Company
C The Company operates in one segment ie Hoteliering and within one geographical segment ie India
D Defined Benefit Plan
The Company has taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liabilitywith respect to the employees and the premium paid to LIC is charged to Statement of Profit amp Loss Thedifference between the actuarial valuation of the gratuity with respect to employees at the year-end and thecontribution paid to LIC is further adjusted in the books of accounts
The accounting charge for benefits under the defined benefit obligation is calculated by independent actuaryusing the projected unit credit method
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee (ITC Limited) as per theOperating License Agreement hence no effect on Statement of Profit amp Loss and Other Comprehensive
54
NOTES TO THE FINANCIAL STATEMENTS
Income
Risk ManagementThe defined Benefit Plan expose the company to risk of actuarial deficit arising out of investment risk interestrate risk and salary cost inflation riskInvestment Risks This may arise from volatility in asset values due to market fluctuations and impairment ofassets due to credit losses These Plans primarily invest in debt instruments such as Government securitiesand highly rated corporate bonds ndash the valuation of which is inversely proportional to the interest rate movementsInterest Rate Risk The present value of Defined Benefit Plans liability is determined using the discount ratebased on the market yields prevailing at the end of reporting period on Government bonds A decrease inyields will increase the fund liabilities and vice-versaSalary Cost Inflation Risk The present value of the Defined Benefit Plan liability is calculated with referenceto the future salaries of participants under the Plan Increase in salary due to adverse inflationary pressuresmight lead to higher liabilitiesThese Plans have a relatively balanced mix of investments in order to manage the above risks The investmentstrategy is designed based on the interest rate scenario liquidity needs of the Plans and pattern of investmentas prescribed under various statutes
(Amount in `) Particulars Gratuity 2018-19 2017-18
I Components of Defined Benefit Cost 31-03-2019 31-03-2018 Recognised in Profit or Loss a Current Service Cost 641829 519816 b Past Service Cost ndash
c Net Interest Cost (184109) (72060) Remeasurements a Effect of changes in demographic assumptions (2108) ndash b Effect of changes in financial assumptions ndash (546692) c Effect of experience adjustments (142950) (700483) d (Return) on plan assets (excluding interest income) 24103 110903 e Changes in asset ceiling (excluding interest income) ndash ndash f Total remeasurements included in OCI (169160) (1358078)
Total defined benefit cost recognized in PampL 288560 (910323)I I Net Assets (Liabilities) recognised in Balance Sheet 31-03-2019 31-03-2018
1 Defined Benefit Obligation at end of period 11112243 102978642 Fair value of plan assets at end of period 13058222 120087733 Net defined benefit liability (asset) (1945979) (1710909)
III Change in Defined Benefit Obligation 31-03-2019 31-03-20181 Defined benefit obligation at beginning of period 10297864 111006822 Current service cost 641829 5198163 Interest expenses 755904 7223694 Remeasurements gains (losses)
a Effect of changes in demographic assumptions (2108) ndashb Effect of changes in financial assumptions ndash (546692)c Effect of experience adjustments (142950) (700483)
5 Benefits Paid (438296) (797828)6 Present Value of DBO at end of the year 11112243 10297864
IV Change in Fair Value of Plan Assets 31-03-2019 31-03-20181 Fair value of plan assets at beginning of period 12008773 11529880
55
NOTES TO THE FINANCIAL STATEMENTS
2 Interest income 940012 7944303 Actual Company Contributions 523630 3713884 Benefits Paid (438296) (797828)5 Remeasurements Gains(Losses) on plan assets 24103 1109036 Fair Value of Plan Assets at end of period 13058222 12008773
V Significant Actuarial Assumptions 31-03-2019 31-03-20181 Discount rate () 750 7502 Salary increase rate 70 703 Attrition Rate 20 204 Retirement Age 58 585 Pre-retirement Mortality Indian Assured Indian Assured
Lives Mortality Lives Mortality(2012-14) Ultimate (2006-08) Ultimate
6 Disability Nil NilVI Sensitivity Analysis
The below sensitivity analysis are based on a change in an assumption while holding all other assumptionsconstant In practice this is unlikely to occur and changes in some of the assumptions may be correlatedWhen calculating the sensitivity of the defined benefit obligation to significant actuarial assumptionsthe same method (present value of the defined benefit obligation calculated with the projected unit creditmethod at the end of the reporting period) has been applied as when calculating the defined benefitliability recognised in the balance sheet The methods and types of assumptions used in preparing thesensitivity analysis did not change compared to the prior period
DBO as at DBO as at31-03-2019 31-03-2018
1 Discount rate +100 basis points 10484869 96707062 Discount rate -100 basis points 11804923 109908143 Salary Increase Rate +1 11746789 109364544 Salary Increase Rate -1 10525722 97077345 Attrition Rate +1 11127835 103179616 Attrition Rate -1 11095064 10276102
Maturity Analysis of the Benefit Payments 31-03-2019 31-03-2018 Year 1 804294 399061 Year 2 1117591 769443 Year 3 558914 1211853 Year 4 2204073 512504 Year 5 1303903 2056016 Next 5 years 4323660 4603103
E Amount towards Defined Contribution Plans have been recognized under Contribution to Provident and OtherFunds in Note 16 ` 4564892- (2018 - ` 3983444-)
F The financial statements were approved for issue by the Board of Directors on 15th April 2019G Company has adopted IND As 115 lsquoRevenue from Contracts with Customersrsquo wef 01st April 2018 on prospective
basis and there is no material impact on Financial StatementsH Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Second
Amendment Rules 2019 on 30th March 2019 notifying new Standard Ind AS 116 lsquoLeasesrsquo and otherconsequential amendment in existing Ind As This Ind AS is applicable for annual period beginning on or after01st April 2019 The company is in the process of analysing the impact of such amendment which are notexpected to be material
56
NOTES TO THE FINANCIAL STATEMENTS
21 Financial Instruments and Related DisclosuresI Capital Management
The Company does not have borrowing and aims at maintaining a strong capital base so as to maintain adequatesupply of funds towards future growth plans as a going concern
II Categories of Financial InstrumentsAmount in `
Particulars Note As at As at March 31 2019 March 31 2018
Carrying Fair Carrying FairValue Value Value Value
A Financial Assetsa) Measured at Amortised Cost
i) Cash and cash equivalents 6 763039 763039 900355 900355ii) Other bank balances 7 5489856 5489856 53182631 53182631iii) Trade Receivables 5 16310661 16310661 14154244 14154244iv) Other Financial Assets 8 4724316 4724316 6349124 6349124
Sub - total 27287872 27287872 74586354 74586354 b) Measured at Fair Value through Profit or Loss
i) Investment in mutual funds 4 280294894 280294894 208482957 208482957Sub - total 280294894 280294894 208482957 208482957
Total Financial Assets 307582766 307582766 283069311 283069311B Financial Liabilities
Measured at Amortised Costi) Trade Payables 483074 483074 395920 395920ii) Other Financial Liabilities 12 9272344 9272344 11118126 11118126Total Financial Liabilities 9755418 9755418 11514046 11514046
The carrying amounts of trade payables other financial liabilities cash and cash equivalents other bank balancestrade receivables and other financial assets are considered to be the same as their fair values due to their short termnatureFair value in Mutual fund has been considered as Level 1 as Hierarchy for the same are based on unadjusted pricesin active marketIII Financial Risk Management Objectives
The Company has a system-based approach to risk management anchored to policies and procedures andinternal financial controls aimed at ensuring early identification evaluation and management of key financialrisks (such as market risk credit risk and liquidity risk) that may arise as a consequence of its businessoperations as well as its investing activities Accordingly the Companyrsquos risk management framework has theobjective of ensuring that such risks are managed within acceptable and approved risk parameters in a disciplinedand consistent manner and in compliance with applicable regulation It also seeks to drive accountability in thisregardLiquidity RiskThe company has current assets aggregate to ` 308020330- (2018- ` 283475635) including CurrentInvestments Cash and cash equivalents and Other bank balances of ` 286547789- (2018- ` 262565943-)against an aggregate Current liability of ` 11093758- (2018- ` 12730077-) on the reporting dateFurther whilethe Companyrsquos total equity stands at ` 306150187- (2018- ` 281343744-) and it has no borrowings In suchcircumstances liquidity risk or the risk that the company may not be able to settle or meet its obligations as theybecome due does not existMarket RiskThe company invests in mutual fund schemes of leading fund houses Such investments are susceptible tomarket price risk that arise mainly from changes in interest rate which may impact the return and value of such
57
NOTES TO THE FINANCIAL STATEMENTS
investments However given the relatively short tenure of the underlying portfolio of the mutual fund schemes inwhich the company has invested such price risk is not significantCredit RiskCompanyrsquos deployment in financial instruments such as mutual funds and fixed deposit are made in high qualitypaperscounterparties The company has receivable balances with ITC Limited under the Operating ServiceAgreement which are generally short term in nature Accordingly the Company has concluded that no provisionfor expected credit loss is required
22 Related Party DisclosuresRelated Party Transactionsi) Name of related parties and nature of relationships
ITC Limited of which the Company is an Associateii) Key Management Personnel
Board of DirectorsN Anand Chairman amp Non-Executive DirectorJ Singh Non-Executive DirectorR C Mehta Non-Executive DirectorC K Koshy Non-Executive DirectorM Narayanan Non-Executive DirectorD R Choudhury Non-Executive Director
iii) Summary of transactions during the year Amount in `
Particulars ITC Limited Key ManagementPersonnel
2019 2018 2019 2018License Fees Received 43644599 38834172 ndash ndashPurchase of Services 364514 513635 ndash ndashRemuneration of Managers on Deputation Reimbursed 5916468 5236397 ndash ndashRecoveries of Contractual Remuneration(Including Mangers on Deputation) 53058539 51502148 ndash ndashExpenses Recovered 2168155 2400471 ndash ndashExpenses Reimbursed ndash 44604 ndash ndashDividend Payments 6068675 6068675 700 700Remuneration to Key Management Personnel- Directorrsquos Sitting Fees 370000 350000Balance amount recoverable 20865894 18292750 ndash ndashBalance amount payable ndash ndash ndash ndash
58
TO THE MEMBERS OFGUJARAT HOTELS LIMITED
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying financial statementsof Gujarat Hotels Limited (ldquothe Companyrdquo) which comprisethe Balance Sheet as at 31st March 2019 the Statement ofProfit and Loss including other comprehensive incomeStatement of Changes in Equity and Statement of CashFlows for the year then ended and notes to the financialstatements including a summary of significant accountingpolicies and other explanatory information (hereinafterreferred to as ldquothe financial statementsrdquo)
In our opinion and to the best of our information andaccording to the explanations given to us the aforesaidfinancial statements give the information required by theCompanies Act 2013 (ldquothe Actrdquo) in the manner so requiredand give a true and fair view in conformity with the IndianAccounting Standards specified under section 133 of theAct read with the Companies (Indian Accounting Standards)Rules 2015 as amended (lsquoInd ASrdquo) and other accountingprinciples generally accepted in India of the state of affairsof the Company as at 31 st March 2019 and totalcomprehensive income (comprising of profit and othercomprehensive income) changes in equity and its cashflows for the year ended on that date
Basis for Opinion
We conducted our audit of the financial statements inaccordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act Our responsibilities underthose Standards are further described in the AuditorrsquosResponsibilities for the Audit of the Financial Statementssection of our report We are independent of the Companyin accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financialstatements under the provisions of the Act and the Rulesmade thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements andthe Code of Ethics We believe that the audit evidence wehave obtained is sufficient and appropriate to provide abasis for our audit opinion
Key Audit Matters
Key audit matters are those matters that in our professionaljudgment were of most significance in our audit of thesefinancial statements of the current period These matterswere addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereonand we do not provide a separate opinion on these mattersWe have determined the matters described below to bethe key audit matters to be communicated in our report
INDEPENDENT AUDITORS REPORT
Information Other than the Financial Statements andAuditorrsquos Report Thereon
The Companyrsquos Board of Directors is responsible forpreparation of the other information The other informationcomprises the information included in the Boardrsquos Reportincluding Annexures to Boardrsquos Report ManagementDiscussion and Analysis Report on Corporate Governance
and Shareholderrsquos Information but does not include thefinancial statements and our auditorrsquos report thereon
Our opinion on the financial statements does not cover theother information and we do not express any form ofassurance conclusion thereon
In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing
Sr No
Key Audit Matter How our audit addressed the matter
1 Evaluation of uncertain legal position of leasehold land
(Refer note no 20A to the financial statements)
The lease period of land held by the Company has expired The Company has filed necessary writ petition with High Court of Gujarat in April 2013 which is still pending for adjudication The Company has also made necessary application to State Government for Conversion of land from Leasehold to Freehold or Extension of Lease which is in process This matter being sub-judice essentially involves significant judgement to determine the possible outcome and therefore we have considered it as a key audit matter
We performed the following substantive procedures
Obtained details of application made to State Government Obtained details of writ petition filed to the High Court of
Gujarat and order copy passed by the High Court of Gujarat restraining the State Government from disturbing the actual possession over the property
Obtained details of progress in the matter Discussed the case with the Companyrsquos legal advisor about
the possible outcomes Read the minutes of the board meetings
Based on the procedures described managementrsquos evaluation on the same is acceptable
59
so consider whether the other information is materiallyinconsistent with the financial statements or our knowledgeobtained in the audit or otherwise appears to be materiallymisstated
If based on the work we have performed we conclude thatthere is a material misstatement of this other informationwe are required to report that fact We have nothing to reportin this regard
Responsibilities of Management and Those Charged withGovernance for the Financial Statements
The Companyrsquos Board of Directors is responsible for thematters stated in section 134(5) of the Act with respect tothe preparation of these financial statements that give atrue and fair view of the financial position financialperformance including other comprehensive incomechanges in equity and cash flows of the Company inaccordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards(Ind AS) prescribed under section 133 of the Act
This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company andfor preventing and detecting frauds and other irregularitiesselection and application of appropriate accounting policies making judgments and estimates that are reasonableand prudent and design implementation andmaintenance of adequate internal financial controls thatwere operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to thepreparation and presentation of the financial statementsthat give a true and fair view and are free from materialmisstatement whether due to fraud or error
In preparing the financial statements management isresponsible for assessing the Companyrsquos ability tocontinue as a going concern disclosing as applicablematters related to going concern and using the goingconcern basis of accounting unless management eitherintends to liquidate the Company or to cease operationsor has no realistic alternative but to do so
The Board of Directors is also responsible for overseeingthe Companyrsquos financial reporting process
Auditorrsquos Responsibilities for the Audit of the FinancialStatements
Our objectives are to obtain reasonable assurance aboutwhether the financial statements as a whole are free frommaterial misstatement whether due to fraud or error andto issue an auditorrsquos report that includes our opinionReasonable assurance is a high level of assurance but isnot a guarantee that an audit conducted in accordance withSAs will always detect a material misstatement when itexists Misstatements can arise from fraud or error and areconsidered material if individually or in the aggregate they
could reasonably be expected to influence the economicdecisions of users taken on the basis of these financialstatements
As part of an audit in accordance with SAs we exerciseprofessional judgment and maintain professionalskepticism throughout the audit We also
bull Identify and assess the risks of materialmisstatement of the financial statements whetherdue to fraud or error design and perform auditprocedures responsive to those risks and obtain auditevidence that is sufficient and appropriate to providea basis for our opinion The risk of not detecting amaterial misstatement resulting from fraud is higherthan for one resulting from error as fraud may involvecollusion forgery intentional omissionsmisrepresentations or the override of internal control
bull Obtain an understanding of internal control relevantto the audit in order to design audit procedures thatare appropriate in the circumstances Under section143(3)(i) of the Act we are also responsible forexpressing our opinion on whether the Company hasadequate internal financial controls system in placeand the operating effectiveness of such controls
bull Evaluate the appropriateness of accounting policiesused and the reasonableness of accountingestimates and related disclosures made bymanagement
bull Conclude on the appropriateness of managementrsquosuse of the going concern basis of accounting andbased on the audit evidence obtained whether amaterial uncertainty exists related to events orconditions that may cast significant doubt on theCompanyrsquos ability to continue as a going concern Ifwe conclude that a material uncertainty exists we arerequired to draw attention in our auditorrsquos report tothe related disclosures in the financial statementsor if such disclosures are inadequate to modify ouropinion Our conclusions are based on the auditevidence obtained up to the date of our auditorrsquosreport However future events or conditions maycause the Company to cease to continue as a goingconcern
bull Evaluate the overall presentation structure andcontent of the financial statements including thedisclosures and whether the financial statementsrepresent the underlying transactions and events ina manner that achieves fair presentation
We communicate with those charged with governanceregarding among other matters the planned scope andtiming of the audit and significant audit findings includingany significant deficiencies in internal control that weidentify during our audit
INDEPENDENT AUDITORS REPORT
60
We also provide those charged with governance with astatement that we have complied with relevant ethicalrequirements regarding independence and tocommunicate with them all relationships and other mattersthat may reasonably be thought to bear on ourindependence and where applicable related safeguards
From the matters communicated with those charged withgovernance we determine those matters that were of mostsignificance in the audit of the financial statements of thecurrent year and are therefore the key audit matters Wedescribe these matters in our auditorrsquos report unless lawor regulation precludes public disclosure about the mattersor when in extremely rare circumstances we determinethat a matters should not be communicated in our reportbecause the adverse consequences of doing so wouldreasonably be expected to outweigh the public interestbenefits of such communication
Report on Other Legal and Regulatory Requirements
1 As required by the Companies (Auditorrsquos Report)Order 2016 (ldquothe Orderrdquo) issued by the CentralGovernment of India in terms of sub-section (11) ofsection 143 of the Act we give in ldquoAnnexure Ardquo astatement on the matters specified in paragraphs 3and 4 of the Order to the extent applicable
2 As required by Section 143(3) of the Act we reportthat
a we have sought and obtained all the information andexplanations which to the best of our knowledge andbelief were necessary for the purposes of our audit
b in our opinion proper books of account as requiredby law have been kept by the Company so far as itappears from our examination of those books
c the Balance Sheet the Statement of Profit and lossincluding other comprehensive income the Statementof Changes in Equity and the Statement of Cash Flowsdealt with by this Report are in agreement with thebooks of account
d in our opinion the aforesaid financial statementscomply with the Indian Accounting Standards (Ind AS)prescribed under Section 133 of the Act
e on the basis of the written representations receivedfrom the directors as on 31st March 2019 taken onrecord by the Board of Directors none of the directorsis disqualified as on 31st March 2019 from beingappointed as a director in terms of Section 164(2) ofthe Act
f with respect to the adequacy of the internal financialcontrols with reference to financial statements of theCompany and the operating effectiveness of suchcontrols refer to our separate report in ldquoAnnexure Brdquoand
g with respect to the other matters to be included in theAuditorrsquos Report in accordance with the requirementsof section 197(16) of the Act as amended theCompany has neither paid nor provided for anyremuneration to its directors during the year
h with respect to the other matters to be included in theAuditorrsquos Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules 2014 in ouropinion and to the best of our information andaccording to the explanations given to us
i the Company does not have any pendinglitigations which would impact its financialposition
ii the Company did not have any long-termcontracts including derivative contracts for whichthere were any material foreseeable losses
iii there has been no delay in transferringamounts required to be transferred to theInvestor Education and Protection Fund by theCompany
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
61
ANNEXURE A TO THE INDEPENDENT AUDITORrsquoS REPORT
The annexure referred to in our Independent AuditorrsquosReport to the members of Gujarat Hotels Limited (ldquotheCompanyrdquo) on the financial statements for the year ended31st March 2019 we report that
i (a) The Company has maintained proper recordsshowing full particulars including quantitativedetails and situation of fixed assets
(b) As explained to us the Company has a regularprogram of physical verification of fixed assetswhich in our opinion is reasonable The assetswhich were to be covered as per the saidprogram have been physically verified by themanagement during the year In our opinion andAccording to the information and explanationsgiven to us no material discrepancies werenoticed on such verification
(c) According to the information and explanationsgiven to us and on the basis of our examinationof the records of the Company the title deeds ofimmovable properties are held in the name ofthe Company with respect to land the Companyhas filed a writ petition with Gujarat High Courtseeking that the Gujarat State Government bedirected to take action on Companyrsquosapplication to have the leasehold land of theHotel Converted to freehold and transferred toCompany as per the existing government policyin this regard
ii The Company does not have any inventory andtherefore reporting under clause (ii) of the Order isnot applicable to the Company
iii The Company has not granted any loans secured orunsecured to Companies firms Limited LiabilityPartnerships or other parties covered in the registermaintained under section 189 of the Companies Act2013 and therefore reporting under clause (iii) of theOrder is not applicable to the Company
iv The Company has not given any loans guaranteesor security In respect of the Investments made in ouropinion and according to the information andexplanations given to us the Company has compliedwith the provisions of section 186 of the Act
v According to the information and explanations givento us the Company has not accepted any depositsduring the year from the public within the meaning ofprovisions of section 73 to 76 of the Companies Act2013 and the rules framed thereunder and thereforereporting under clause (v) of the Order is notapplicable to the Company
vi In our opinion and according to the information andexplanations given to us in view of Rule 3 of theCompanies (Cost Records and Audit) AmendmentsRules 2014 the maintenance of cost records undersub-section (1) of section 148 of the Companies Act2013 is not applicable to the Company and thereforereporting under clause (vi) of the Order is notapplicable to the Company
vii (a) According to the information and explanationsgiven to us the Company has been regular indepositing with appropriate authoritiesundisputed statutory dues including providentfund employeersquos state insurance income-taxvalue added tax goods and service tax cessand other statutory dues applicable to it Furtherno undisputed amounts payable in respect ofprovident fund employeersquos state insuranceincome tax value added tax goods and servicetax cess and any other statutory dues were inarrears as at 31st March 2019 for a period ofmore than six months from the date theybecome payable
(b) According to the information and explanationsgiven to us there are no dues of Income taxsales tax value added tax and goods andservice tax which have not been deposited onaccount of any dispute
viii The Company has not taken any loans or borrowingsfrom financial institutions banks and government orhas not issued any debentures and thereforereporting under clause (viii) of the Order is notapplicable to the Company
ix The Company has not raised moneys by way of initialpublic offer or further public offer (including debtinstrument) and term loans during the year andtherefore reporting under clause (ix) of the Order isnot applicable to the Company
x To the best of our knowledge and according toinformation and explanations given to us no materialfraud by the Company or on the Company by its officersor employees has been noticed or reported duringthe course of our audit
xi In our opinion and according to the information andexplanations given to us the Company has not paidor provided any managerial remuneration during theyear and therefore reporting under clause (xi) of theOrder is not applicable to the Company
xii The Company is not a Nidhi company and thereforereporting under clause (xii) of the Order is notapplicable to the Company
INDEPENDENT AUDITORS REPORT
62
xiii In our opinion and according to the information andexplanations given to us and based on ourexamination of the records of the Company alltransactions with the related parties are in compliancewith Section 177 and 188 of the Act where applicableand the details have been disclosed in the financialstatements as required by the applicable accountingstandards
xiv According to the information and explanations givento us the Company has not made any preferentialallotment or private placement of shares or fully orpartly convertible debentures during the year underreview and therefore reporting under clause (xiv) ofthe Order is not applicable to the Company
xv In our opinion and according to the information andexplanations given to us the Company has not
entered into any non-cash transactions with directorsor persons connected with directors and thereforereporting under clause (xv) of the Order is notapplicable to the Company
xvi The Company is not required to be registered undersection 45-IA of the Reserve Bank of India Act 1934
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
63
ANNEXURE ldquoBrdquo TO THE INDEPENDENT AUDITORSrsquo REPORT
(Referred to in paragraph 2(f) under lsquoReport on Other Legaland Regulatory Requirementsrsquo section of our report to theMembers of Gujarat Hotels Limited on the financialstatements of even date)
Report on the Internal Financial Controls with referenceto financial statements under Clause (i) of Sub-section 3of Section 143 of the Act
W e have audited the internal financial controls withreference to financial statements of Gujarat Hotels Limited(ldquothe Companyrdquo) as of 31st March 2019 in conjunction withour audit of the financial statements of the Company for theyear ended on that date
Managementrsquos Responsibility for Internal FinancialControls
The Companyrsquos management is responsible forestablishing and maintaining internal financial controlsbased on the internal control over financial reporting criteriaestablished by the Company considering the essentialcomponents of internal control stated in the Guidance Noteon Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountantsof India (ldquoICAIrdquo) These responsibilities include the designimplementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuringthe orderly and efficient conduct of its business includingadherence to companyrsquos policies the safeguarding of itsassets the prevention and detection of frauds and errorsthe accuracy and completeness of the accounting recordsand the timely preparation of reliable financial informationas required under the Act
Auditorsrsquo Responsibility
Our responsibility is to express an opinion on theCompanyrsquos internal financial controls with reference tofinancial statements based on our audit We conductedour audit in accordance with the Guidance Note on Audit ofInternal Financial Controls over Financial Reporting (theldquoGuidance noterdquo) and the Standards on Auditing issued byICAI and deemed to be prescribed under section 143(10)of the Companies Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the ICAIThose Standards and the Guidance Note require that wecomply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whetheradequate internal financial controls with reference tofinancial statements were established and maintained andif such controls operated effectively in all material respects
Our audit involves performing procedures to obtain auditevidence about the adequacy of the internal financialcontrols with reference to financial statements and their
operating effectiveness Our audit of internal financialcontrols with reference to financial statements includedobtaining an understanding of internal financial controlswith reference to financial statements assessing the riskthat a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal controlbased on the assessed risk The procedures selecteddepend on the auditorrsquos judgement including theassessment of the risks of material misstatement of thefinancial statements whether due to fraud or error
We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our auditopinion on the Companyrsquos internal financial controls withreference to financial statements
Meaning of Internal Financial Controls with reference tofinancial statements
A Companyrsquos internal financial controls with reference tofinancial statements is a process designed to providereasonable assurance regarding the reliability of financialreporting and the preparation of financial statements forexternal purposes in accordance with generally acceptedaccounting principles A Companyrsquos internal financialcontrols with reference to financial statements includesthose policies and procedures that (1) pertain to themaintenance of records that in reasonable detailaccurately and fairly reflect the transactions anddispositions of the assets of the Company (2) providereasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements inaccordance with generally accepted accounting principlesand that receipts and expenditures of the Company arebeing made only in accordance with authorisations ofmanagement and directors of the Company and (3) providereasonable assurance regarding prevention or timelydetection of unauthorised acquisition use or dispositionof the Companyrsquos assets that could have a material effecton the financial statements
Inherent Limitations of Internal Financial Controls withreference to financial statements
Because of the inherent limitations of internal financialcontrols with reference to financial statements includingthe possibility of collusion or improper managementoverride of controls material misstatements due to erroror fraud may occur and not be detected Also projections ofany evaluation of the internal financial controls withreference to financial statements to future periods aresubject to the risk that the internal financial control withreference to financial statements may become inadequatebecause of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate
INDEPENDENT AUDITORS REPORT
64
Opinion
In our opinion the Company has in all material respectsan adequate internal financial controls with reference tofinancial statements and such internal financial controlswith reference to financial statements were operatingeffectively as at 31st March 2019 based on the internalcontrol over financial reporting criteria established by theCompany considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal
INDEPENDENT AUDITORS REPORT
Financial Controls over Financial Reporting issued by theInstitute of Chartered Accountants of India
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
1
Board of Directors amp Committees 2
Notice of Annual General Meeting 3
Your Directors 9
Report on Corporate Governance 11
Shareholder Information 17
Report of the Board of Directors amp Management 20Discussion and Analysis
CEO and CFO Compliance Certificate 39
Balance Sheet 40
Statement of Profit and Loss 41
Statement of changes in equity 42
Cash Flow Statement 43
Notes to the Financial Statements 44
Independent Auditors Report 58
Board of DirectorsCONTENTS
2
BOARD OF DIRECTORS amp COMMITTEES
Board Committees
Chairman and Non-Executive Director
Nakul Anand
Non-Executive Directors
Mohan Swarup Bhatnagar
Devkanya Roy Choudhury
Cheruvettolil Kochukoshy Koshy
Mahalinga Narayanan
Jagdish Singh
M Narayanan Chairman C K Koshy Chairman J Singh Chairman
C K Koshy Member N Anand Member D R Choudhury Member
J Singh Member M Narayanan Member C K Koshy Member
M Agarwal Invitee J Singh Member
K Pahwa Invitee
Representative of InviteeStatutory Auditors
Audit Committee Nominations andRemuneration Committee
StakeholdersRelationship Committee
Key Managerial Personnel
Board of Directors
Registered Office Statutory Auditors Registrar and Share Transfer AgentsWelcomHotel Vadodara K C Mehta amp Co MCS Share Transfer Agent LimitedR C Dutt Road Alkapuri Chartered Accountants F-651st FloorVadodara - 390 007 Vadodara Okhla Industrial Area Phase - 1Tel 0265-233 0033 New Delhi 110 020CIN L55100GJ1982PLC005408 Tel 011-4140 6149-52 4160 9386Website wwwgujarathotelsltdinE-mail ghlinvestorsyahoocoin
Chief Executive Officer - Kunal Pahwa Chief Financial Officer - Mayur Agarwal
3
NOTICE IS HEREBY GIVEN that the Thirty Seventh AnnualGeneral Meeting of the Members of Gujarat Hotels Limitedwill be held at the Registered Office of the Company atWelcomHotel Vadodara R C Dutt Road Alkapuri Vadodarandash 390 007 on Saturday the 7th day of September 2019 at1100 am for the transaction of the following businesses-
ORDINARY BUSINESS
1 To consider and adopt the Financial Statements of theCompany for the financial year ended 31st March2019 and the Reports of the Board of Directors andthe Auditors
2 To declare dividend for the financial year ended31st March 2019
3 To appoint a Director in place of Mr Jagdish Singh(DIN 00042258) who retires by rotation and beingeligible offers himself for re-election
4 To consider and if thought fit to pass the followingresolution as an Ordinary Resolution-
ldquoResolved that in accordance with the provisions ofSection 142 of the Companies Act 2013 payment ofremuneration of ` 60000- (Rupees Sixty Thousandonly) to Messrs K C Mehta amp Co CharteredAccountants (FRN 106237W) to conduct the audit forthe financial year 2019-20 plus goods and servicestax as applicable and reimbursement of out-of-pocketexpenses incurred be and is hereby approvedrdquo
SPECIAL BUSINESS
5 To consider and if thought fit to pass the followingresolution as an Ordinary Resolution-
ldquoResolved that in accordance with the provisions ofSection 149 read with Schedule IV of the CompaniesAct 2013 and Regulation 17 of the Securities andExchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 thisMeeting hereby approves the appointment ofMr Mohan Swarup Bhatnagar (DIN 00834857) as anIndependent Director of the Company for a period offive years with effect from 28th June 2019 or till suchearlier date as may be determined by any applicablestatutes rules regulations or guidelinesrdquo
6 To consider and if thought fit to pass the followingresolution as a Special Resolution-
ldquoResolved that in accordance with the provisions ofSection 149 read with Schedule IV of the Companies
GUJARAT HOTELS LIMITEDCIN L55100GJ1982PLC005408
Registered Office WelcomHotel Vadodara R C Dutt Road Alkapuri Vadodara-390 007Tel +91 0265 233 0033 E-mail ghlinvestorsyahoocoin Website wwwgujarathotelsltdin
NOTICE OF 37TH ANNUAL GENERAL MEETING
AGM NOTICE
Act 2013 and Regulation 17 of the Securities andExchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 thisMeeting hereby approves the re-appointment ofMr Cheruvettolil Kochukoshy Koshy (DIN 01478704)as an Independent Director of the Company for aperiod of five years with effect from 29th September2019 or till such earlier date as may be determinedby any applicable statutes rules regulations orguidelinesrdquo
7 To consider and if thought fit to pass the followingresolution as a Special Resolution-
ldquoResolved that in accordance with the provisions ofSection 149 read with Schedule IV of the CompaniesAct 2013 and Regulation 17 of the Securities andExchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 thisMeeting hereby approves the re-appointment ofMr Mahalinga Narayanan (DIN 00159288) as anIndependent Director of the Company for a period offive years with effect from 29th September 2019 or tillsuch earlier date as may be determined by anyapplicable statutes rules regulations or guidelinesrdquo
The Register of Members of the Company will remainclosed from Friday 30th August 2019 to Saturday7th September 2019 both days inclusive ShareTransfers received in order at the Companyrsquos Registrarand Share Transfer Agents Messrs MCS ShareTransfer Agent Limited F-65 1st Floor Okhla IndustrialArea Phase - I New Delhi - 110 020 by 530 pm onThursday 29th August 2019 will be processed forpayment of dividend if declared to the transferees orto their mandatees and the dividend if declared willbe paid on Friday 13th September 2019 to thoseMembers entitled thereto and whose names willappear in the Register of Members of the Companyon 7th September 2019 or to their mandatees subjecthowever to the provisions of Section 126 of theCompanies Act 2013 In respect of dematerialisedshares the dividend will be paid on the basis ofbeneficial ownership as on 29th August 2019 as perdetails to be furnished by National SecuritiesDepository Limited (NSDL) and Central DepositoryServices (India) Limited (CDSL) for this purpose
By Order of the BoardGujarat Hotels Limited
Place New Delhi Jagdish SinghDate 15th July 2019 Director
4
NOTES
1 A Member entitled to attend and vote at the AnnualGeneral Meeting (lsquoAGMrsquo) may appoint a proxy toattend and vote on his behalf A proxy need not be aMember of the Company
Proxies in order to be effective must be received atthe Registered Office of the Company not less thanforty-eight hours before the commencement of the AGMie by 1100 am on 5th September 2019
Corporate Members are required to send to theRegistered Office of the Company a certified copy ofthe Board Resolution pursuant to Section 113 of theCompanies Act 2013 (lsquothe Actrsquo) authorising theirrepresentatives to attend and vote at the AGM
2 Explanatory Statement pursuant to Section 102 of theAct relating to the Special Business to be transactedat this AGM is annexed
3 Route map of the AGM venue pursuant to theSecretarial Standard on General Meetings is alsoannexed
4 In terms of Section 108 of the Act read with Rule 20 ofthe Companies (Management and Administration)Rules 2014 the Resolutions for consideration at thisAGM will be transacted through remote e-voting (facilityto cast vote from a place other than the venue of theAGM) for which purpose the Board of Directors of theCompany (lsquothe Boardrsquo) have engaged the services ofCDSL
The facility for voting through ballot paper will beavailable at the AGM venue for those Members who donot cast their votes by remote e-voting prior to the AGMMembers who cast their votes by remote e-voting mayattend the Meeting but will not be entitled to cast theirvotes once again The Board has appointedMr Suresh Kabra (ACS 9711) Partner Messrs SamdaniKabra amp Associates Company Secretaries as theScrutinizer to scrutinize the process of remote e-votingand voting through ballot paper at the AGM venue
5 Voting rights will be reckoned on the paid-up value ofshares registered in the name of the Members on31st August 2019 (cut-off date) Only those Memberswhose names are recorded in the Register ofMembers of the Company or in the Register ofBeneficial Owners maintained by the Depositories ason the cut-off date will be entitled to cast their votes byremote e-voting or voting through ballot paper at theAGM venue A person who is not a Member on thecut-off date should accordingly treat this Notice as forinformation purposes only
6 Unclaimed dividend for the financial year ended31st March 2012 and the corresponding Equity Sharesof the Company in respect of which dividend
entitlements remain unclaimed for seven consecutiveyears will be due for transfer to the Investor Educationand Protection Fund of the Central Government on14th September 2019 pursuant to the provisions ofSection 124 of the Act read with the Investor Educationand Protection Fund Authority (Accounting AuditTransfer and Refund) Rules 2016 Members arerequested to claim the said dividend details of whichare available on the Companyrsquos websitewwwgujarathotelsltdin under the section lsquoGeneralInformationrsquo under lsquoShareholder Valuersquo The Companywill not be able to entertain any claim received after12th September 2019 in respect of the same
7 Members may visit the Companyrsquos website to viewthe Financial Statements or access informationpertaining to the Company Queries if any should besent at least 10 days before the AGM to theChief Financial Officer at the Registered Office of theCompany
8 Members are required to bring their admission slipsto the AGM Duplicate admission slips or copies of theReport and Accounts will not be made available at theAGM venue
9 The procedure with respect to remote e-voting isprovided below
I The period for remote e-voting begins onTuesday 3rd September 2019 at 900 am andends on Friday 6th September 2019 at 500 pmDuring this period Members of the Companyholding shares either in certificate form or indematerialised form as on the cut-off date ie31st August 2019 may cast their voteselectronically The e-voting module shall bedisabled by CDSL for voting thereafter
II The Members should log on to the e-votingwebsite wwwevotingindiacom
III Click on lsquoShareholders MembersrsquoIV Now enter your user ID as under
bull For CDSL 16 digits beneficiary ID
bull For NSDL 8 character DP ID followed by 8digits Client ID
bull Members holding shares in certificate formshould enter Folio Number registered withthe Company
V Thereafter enter the image verification code asdisplayed and Click on lsquoLoginrsquo
VI If you are holding shares in dematerialised formand had logged on to wwwevotingindiacom andcasted your vote earlier for any company thenyour existing password is to be used If you have
5
forgotten the password then enter user ID andthe image verification code and click on forgotpassword amp enter the details as prompted by thesystem
VII If you are a first time user please follow the stepsgiven below
For Members holding shares either in dematerialisedform or in certificate form
PAN Enter your 10 digit alpha-numeric PAN issuedby Income Tax Departmentbull Members who have not updated their
PAN with the Company DepositoryParticipant are requested to use the firsttwo letters of their name and the 8 digitsof the sequence number in the PAN field
bull In case the sequence number is lessthan 8 digits enter the applicable numberof 0rsquos before the number after the firsttwo characters of the name in CAPITALletters Eg If your name is RameshKumar with sequence number I thenenter RA00000001 in the PAN field
Dividend Enter the Dividend Bank Details or Date ofBank Birth (in ddmmyyyy format) as recorded inDetails your demat account or in the CompanyOR records in order to loginDate of bull If both the details are not recorded withBirth the Depository or the Company please
enter your member ID folio number inthe Dividend Bank details field asmentioned in instruction IV
VIII After entering these details appropriately click onlsquoSubmitrsquo
IX Members holding shares in certificate form willthen reach directly to the Companyrsquos selectionscreen
X Members holding shares in dematerialised formwill then reach the lsquoPassword Creationrsquo menuwherein they are required to mandatorily entertheir login password in the new password fieldKindly note that this password can be used forvoting on resolutions of any other company onwhich you are eligible to vote provided that thesaid company opts for e-voting through CDSLplatform It is strongly recommended not to shareyour password with any other person and takeutmost care to keep your password confidential
XI For Members holding shares in certificate formthe details can be used only for e-voting on theResolutions contained in this Notice
XII Click on the EVSN for Gujarat Hotels Limited
XIII On the voting page you will see lsquoResolutionDescriptionrsquo and against the same the optionlsquoYes Norsquo for voting Select the option lsquoYesrsquo or lsquoNorsquoas desired The option lsquoYesrsquo implies that youassent to the Resolution and the option lsquoNorsquoimplies that you dissent to the Resolution
XIV Click on the lsquoResolutions File Linkrsquo if you wish toview the entire Resolution details
XV After selecting the Resolution you have decidedto vote on click on lsquoSubmitrsquo A confirmation boxwill be displayed If you wish to confirm your voteclick on lsquoOkrsquo else to change your vote click onlsquoCancelrsquo and accordingly modify your vote
XVI Once you lsquoConfirmrsquo your vote on the Resolutionyou will not be allowed to modify your vote
XVII You can also take a print of the votes cast byclicking on lsquoClick here to printrsquo option on theVoting page
XVIII Members can also cast their vote using CDSLrsquosmobile app lsquom-Votingrsquo available on Android Appleand Windows based mobiles Members may login to m-Voting using their e-voting credentials tovote on the Company Resolutions
XIX Note for NonndashIndividual Members and Custodians
bull Non-Individuals Members (ie other than HUFIndividuals NRI etc) and Custodians are requiredto log on to wwwevotingindiacom and registerthemselves as Corporates
bull A scanned copy of the Registration Form bearingthe stamp and sign of the entity should be emailedto helpdeskevotingcdslindiacom
bull After receiving the login details user would be ableto link the account(s) for which they wish to voteon
bull The list of accounts linked in the login should bemailed to helpdeskevotingcdslindiacom and onapproval of the accounts they would be able tocast their vote
bull A scanned copy of the Board Resolution and Powerof Attorney (POA) which they have issued in favourof the Custodian if any should be uploaded in PDFformat in the system for the Scrutinizer to verify thesame
XX In case you have any queries or issues regardinge-voting you may refer to the Frequently AskedQuestions and e-voting manual available underthe help section of CDSLrsquos e-voting websitewwwevotingindiacom or write an email tohelpdeskevotingcdslindiacom or contact
6
Mr Rakesh Dalvi at telephone no 18002005533(toll free) You may also address your queries grievances relating to remote e-voting or votingat the meeting to Mr M Agarwal ComplianceOfficer at e-mail ID ghlinvestorsyahoocoin orat telephone no 0265 233 0033
XXI Those who become Members of the Companyafter despatch of the Notice but on or before31st August 2019 (cut-off date) may follow thesteps from Sl Nos II to XIX mentioned above forcasting of vote
XXII General Information
(a) There will be one vote for every Client ID NoRegistered Folio No irrespective of thenumber of joint holders
(b) The Results of voting will be declaredwithin 48 hours from the conclusion of theAGM and the Resolutions will be deemedto be passed on the date of the AGMsubject to receipt of requisite number ofvotes The declared Results along with theScrutinizerrsquos Report will be availableforthwith on the Companyrsquos websitewwwgujarathotelsltdin under the sectionlsquoInvestor Relationsrsquo and on the website ofCDSL such Results will also be forwardedto BSE Limited where the Companyrsquosshares are listed
EXPLANATORY STATEMENT
Annexed to the Notice convening the Thirty Seventh AnnualGeneral Meeting to be held on Saturday 7th September2019
Item No 5
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 28th June 2019 on the recommendationof the Nominations and Remuneration Committee(lsquothe Committeersquo) approved the appointment of Mr MohanSwarup Bhatnagar as Additional Director with effect from28th June 2019 and subject to the approval of the Membersalso as Independent Director of the Company for a periodof five years with effect from the said date in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquotheActrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquothe Listing Regulations2015rsquo)
Mr Bhatnagar (67) is a Science Graduate from St StephenrsquosCollege University of Delhi and is an MBA from the Facultyof Management Studies University of Delhi
Mr Bhatnagar joined ITC Limited (ITC) in 1975 in the HotelsDivision He held various job positions in Finance beforetaking over as the Head of Finance in 1997 withresponsibility for Treasury Audit Purchasing MaterialManagement and Information Technology Subsequentlyhe held charge of Growth and Development for the HotelsBusiness as Executive Vice President He was a memberof the Management Committee of the Division and was onthe Boards of Joint Venture and Subsidiary companies ofITC He retired from ITC in September 2013 Currently heis actively involved in angel investing and in mentoringselect start-up ventures
The Committee and the Board are of the view that theassociation of Mr Bhatnagar and the rich experience hebrings with him would benefit the Company Declarationhas been received from Mr Bhatnagar that he meets thecriteria of Independence prescribed under Section 149 ofthe Act read with the Companies (Appointment andQualification of Directors) Rules 2014 and Regulation 16of the Listing Regulations 2015 In the opinion of your BoardMr Bhatnagar fulfils the conditions specified in the Act theRules thereunder and the Listing Regulations 2015 forappointment as an Independent Director and he isindependent of the management of the CompanyMr Bhatnagar will be entitled to sitting fees for attending themeetings of the Board and its Committees
Requisite Notice under Section 160 of the Act proposingthe appointment of Mr Bhatnagar has been received by theCompany and consent has been filled by Mr Bhatnagarpursuant to Section 152 of the Act
Mr Bhatnagar holds 2500 shares in the Company
Mr Bhatnagar and his relatives are interested in thisResolution None of the other Directors and Key ManagerialPersonnel of the Company or their relatives is interestedin this Resolution
The Board recommends this Resolution for your approval
Item Nos 6 amp 7
The Members of the Company at the Thirty Second AnnualGeneral Meeting held on 29th September 2014 approvedthe appointment of Mr Koshy and Mr M Narayanan asIndependent Directors of the Company for a period of fiveyears with effect from the said date Mr Koshy andMr Narayanan will complete their respective terms on28th September 2019
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 15th April 2019 on the recommendationof the Nominations and Remuneration Committee (lsquotheCommitteersquo) recommended for the approval of theMembers the re-appointment of Mr Koshy andMr Narayanan as Independent Directors of the Companywith effect from 29th September 2019 in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquothe
7
Actrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquoListing Regulations2015rsquo) as set out in the Resolutions relating to theirrespective re-appointment
The Committee and the Board are of the view that giventhe knowledge experience and performance of Mr Koshyand Mr Narayanan and contribution to the Board processesby them their continued association would benefit theCompany Declarations have been received from Mr Koshyand Mr Narayanan that they meet the criteria ofIndependence prescribed under Section 149 of the Act readwith the Companies (Appointment and Qualification ofDirectors) Rules 2014 and Regulation 16 of the ListingRegulations 2015 In the opinion of the Board Mr Koshyand Mr Narayanan fulfil the conditions specified in the Actthe Rules thereunder and the Listing Regulations 2015 forre-appointment as Independent Directors and they areindependent of the management of the Company Mr Koshyand Mr Narayanan will be entitled to sitting fees for attendingmeetings of the Board and its Committees
Consent of the Members by way of Special Resolution isrequired for re-appointment of Mr Koshy and Mr Narayananin terms of Section 149 of the Act Further pursuant toRegulation 17 of the Listing Regulations 2015 consent ofthe Members by way of Special Resolution is also requiredfor continuation of a Non-Executive Director beyond the ageof seventy five years During the proposed term ofre-appointment Mr Koshy and Mr Narayanan will attain theage of seventy five years on 12th February 2020 and1st July 2020 respectively The Special Resolutions under
Item No 6 and 7 once passed shall also be deemed asyour approval under the Listing Regulations 2015 forcontinuation of Mr Koshy and Mr Narayanan as IndependentDirectors beyond the age of seventy five years
Requisite Notices under Section 160 of the Act proposingthe re-appointment of Mr Koshy and Mr Narayanan havebeen received by the Company and consents have beenfiled by Mr Koshy and Mr Narayanan pursuant to Section152 of the Act
Additional information in respect of Mr Koshy andMr Narayanan pursuant to the Listing Regulations 2015and the Secretarial Standard on General Meetings isappearing in the Report and Accounts under the sectionslsquoYour Directorsrsquo and lsquoReport on Corporate GovernancersquoMr Koshy and Mr Narayanan do not hold any share in theCompany either in their individual capacity or on a beneficialbasis for any other person
Mr Koshy and Mr Narayanan and their relatives areinterested in the Special Resolutions relating to theirrespective re-appointment None of the other Directors andKey Managerial Personnel of the Company or theirrelatives is interested in these Special Resolutions
The Board recommends these Special Resolutions for yourapproval
By Order of the BoardGujarat Hotels Limited
Place New Delhi Jagdish SinghDate 15th July 2019 Director
8
ROUTE MAP
AGM VenueWelcomHotel VadodaraR C Dutt Road AlkapuriVadodara 390 007
9
N Anand
Nakul Anand (62) DIN 00022279 a Non-Executive Directorof the Company since 10th March 1998 was appointed asthe Chairman of the Company effective 21st March 2009He is an Executive Director on the Board of ITC Limited andholds responsibility for the Hospitality Travel amp Tourismand Lifestyle Retailing businesses of ITC
An Economics Honours Graduate from the Delhi Universitywith an AMP degree from the Bond University AustraliaAnand joined ITC Hotelsrsquo Management TrainingProgramme in 1978 He has also served as the ManagingDirector of erstwhile ITC Hotels Limited during the period2003-05
In a career that spans close to four decades Anand hasbeen acknowledged in the hotels and tourism industry forhis vision and commitment Leveraging the significantlearning of sustainable excellence within ITC he led theteam at ITC Hotels to pioneer the concept of lsquoResponsibleLuxuryrsquo in the hospitality industry securing LEEDreg Platinumcertifications for all ITC premium luxury hotels He hasformulated value-based strategies to create a uniquequality control model His dynamic leadership and passionfor the business is recognised and acknowledged by hispeers He has been a past President of the HotelAssociation of India and past Chairman of the CII NationalTourism Committee Anand is presently a member of theNational Tourism Advisory Council constituted by theMinistry of Tourism Government of India Chairman of theFederation of Associations in Indian Tourism amp Hospitalityand a Member of the Executive Committee of the HotelAssociation of India He is also a Member of the IndiandashSriLanka CEOs Forum Council Member amp ExecutiveCommittee Member of the National Culture Fund Ministryof Culture Government of India and a Member on the Boardof the International Tourism Partnership
Other Directorships
Name of the company Position
International Travel House Limited Chairman amp Non-Executive Director
Landbase India Limited Chairman amp Non-Executive Director
Fortune Park Hotels Limited Chairman amp Non-Executive Director
WelcomHotels Lanka (Private) Limited Chairman amp Non-Executive Director
Srinivasa Resorts Limited Vice Chairman amp Non-Executive Director
ITC Limited Executive Director
Bay Islands Hotels Limited Non-Executive Director
Maharaja Heritage Resorts Limited Non-Executive Director
Committee Membership of other companies
Name of the Committee Positioncompany
International Travel House Limited Nominations amp MemberRemuneration Committee
Landbase India Limited Audit Committee Member
Fortune Park Hotels Limited Corporate Social ChairmanResponsibility Committee
CK Koshy
Cheruvettolil Kochukoshy Koshy (74) DIN01478704 wasappointed as an Independent Non-Executive Director ofthe Company on 1st May 2007 He is Master of Arts inPolitical Science and Public Administration He joined theIndian Administrative Service in 1968 from the Gujarat Cadreand superannuated in February 2005
In a long career spanning over 38 years he has held severaleminent positions including those of Additional ChiefSecretary - Department of Revenue Industries and MinesTourism and Civil Aviation and Finance and PrincipalSecretary to the Chief Minister He served the Governmentof India as Joint Secretary amp Financial Advisor to theDepartment of Atomic Energy and as Executive Director ofNuclear Power Corporation of India Limited He has heldthe posts of Managing Director of the Tourism Corporationof Gujarat Sardar Sarovar Narmada Nigam Gujarat StateSmall Industries Corporation and Girinar Scooter LimitedHe was also the Joint Managing Director of the GujaratIndustrial Investment Corporation and Chairman of GujaratState Petroleum Corporation Limited Gujarat State PetronetLimited and Gujarat Energy Research and ManagementInstitute
Post retirement he has been a consultant to the Departmentfor International Development - UK the World Bank and tothe Department of Personnel and Administrative ReformsGovt of India He was appointed Professor Emeritus in thefaculty of Planning and Public Policy at CEPT UniversityAhmedabad and is an Advisor to both Indian School ofPetroleum and Energy New Delhi and University ofPetroleum and Energy Studies Dehradun Currently he isAdvisor at CEPT University and on the Board of Trustees ofAlliance Francaise Gujarat and GIAN an NGO whichencourages innovation at the grass root level
Koshy does not hold directorship of any other company
M Narayanan
Mahalinga Narayanan (74) DIN 00159288 was appointedas an Independent Non-Executive Director of the Companyon 10th January 2008 He is a post graduate in CommerceGraduate in Law Diploma Holder in Business Managementand holds certified Associated Membership of the Indian
YOUR DIRECTORS
10
Institute of Bankers He has rich experience of over fourdecades in Banking Project Finance Administration andrelated areas
Narayanan started his career with the Reserve Bank ofIndia in 1964 and moved over to the Bank of Baroda in1969 and continued till March 1985 During his tenure inBank of Baroda he worked in all departments of commercialbanking operation and was in-charge of large branches ofthe Bank In April 1985 he joined Industrial FinanceCorporation of India and held senior managementpositions In October 1997 he joined Tourism FinanceCorporation of India Limited as Managing Director and roseto the position of Chairman and Managing Director whichposition he held till his retirement in September 2006 Hewas conferred with ldquoUdyog Rattan Awardrdquo in the year 2005by the Institute of Economic Studies New Delhi
Other Directorships
Name of the company Position
Cox amp Kings Limited Independent DirectorTulip Star Hotels Limited Independent DirectorRoyale Indian Rail Tours Limited Independent DirectorPride Hotels Limited Chairman amp Independent Director
Committee Membership of other Companies
Name of the company Committee Position
Cox amp Kings Limited Audit Committee ChairmanRemuneration MemberCommittee
Pride Hotels Limited Audit Committee ChairmanRoyale Indian Rail Tours Limited Audit Committee Chairman
Tulip Star Hotels Limited Audit Committee Chairman
J Singh
Jagdish Singh (53) DIN 00042258 was appointed as aNon-Executive Director on the Board of the Company on16th April 2016 A Commerce Graduate and a CharteredAccountant Singh joined ITC Limited in the year 1990During these 26 years he has held various positions inthe finance function He started his career in Treasury andmoved as Corporate Accountant Commercial Manager atCigarette factory at Munger and Head of Finance at ITCEssentra Limited He was then the Head of Treasury
between 2005 and 2015 and is presently the Head ofFinance at ITCrsquos Hotels Division
Other DirectorshipsName of the company Position
International Travel House Limited Non-Executive DirectorFortune Park Hotels Limited Non-Executive DirectorBay Islands Hotels Limited Non-Executive DirectorSrinivasa Resorts Limited Non-Executive DirectorMaharaja Heritage Resorts Limited Non-Executive DirectorMimec (India) Limited Non-Executive DirectorLandbase India Limited Additional Non-Executive DirectorLogix Developers Private Limited Non-Executive Director
Committee Membership of other companiesName of the Committee Positioncompany
International Travel House Limited Stakeholders Relationship MemberCommitteeAudit Committee MemberNominations amp Remuneration MemberCommittee
Fortune Park Hotels Limited Corporate Social MemberResponsibility Committee
Srinivasa Resorts Limited Audit Committee ChairmanCorporate Social MemberResponsibility Committee
D R Choudhury
Devkanya Roy Choudhury (41) DIN 07066556 wasappointed as a Non-Executive Director of the Company on19th January 2015 A Graduate from the National LawSchool of India University Bengaluru she joined ITC Limitedin 2001 As part of Corporate Legal of ITC she has rich andvaried experience in handling legal matters pertaining tovarious divisions including Tobacco Hotels Personal CareLifestyle Retailing Education amp Stationery Paperboards ampSpecialty Papers ITC Infotech as also dealing with mergersamp acquisitions and key litigation across ITC CurrentlyMs Choudhury is the Senior Associate General Counsel ofITC Limited
Other Directorships
Name of the Company Position
WelcomHotels Lanka (Private) Limited Non-Executive Director
YOUR DIRECTORS
Denotes foreign company Denotes listed Indian company whose equity shares or preference shares or debt securities are listed on a recognised
stock exchangeNotes1 Other Directorships and Committee Memberships of Directors are as on 15th April 20192 Committee Memberships cover Committees under the Companies Act 2013 viz Audit Committee Stakeholders
Relationship Committee Nomination and Remuneration Committee and CSR Committee of Indian Companies
11
REPORT ON CORPORATE GOVERNANCE
The Directors present the Companyrsquos Report on CorporateGovernance pursuant to the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements)Regulations 2015 (lsquoListing Regulations 2015rsquo)
THE COMPANYrsquoS GOVERNANCE PHILOSOPHY
The Company firmly believes in good CorporateGovernance and has made it a practice and a continuousprocess of development right across the Company TheCompanyrsquos philosophy on Corporate Governanceenvisages attainment of high level of transparency andaccountability in the functioning of the Company andconduct of business and places due emphasis onregulatory compliance It has empowered the ExecutiveManagement to take decisions with regard to day-to-dayoperations and has also created checks and balances thatsuch decisions are taken with care and responsibility tomeet stakeholdersrsquo aspirations and societal expectations
The Companyrsquos corporate philosophy is focused on itspeople who are its most important asset and it values itsemployeesrsquo integrity creativity ability judgement andopinions who in turn demonstrate the highest ethicalstandards and responsibility towards the shareholdersThis has helped the Company take rapid strides in itspursuit of excellence
The Company is committed to enhance shareholder valuein a fair and transparent manner and has been in theforefront for benchmarking itself with the best businesspractices globally
BOARD OF DIRECTORS
All statutory and other significant and material informationare placed before the Board of Directors (the Board) toenable it to discharge its responsibility of strategicsupervision of the Company as trustees of theshareholders
Composition
The Board comprises entirely of Non-Executive Directorsincluding one Woman Director and two IndependentDirectors The strength of the Board as on 15th April 2019is five
The Board Diversity Policy of the Company requires theBoard to have balance of skills experience and diversity ofperspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the Annexure forming part ofthis Report These skills expertise and competencies areavailable in the present mix of the Directors of the Company
Composition of the Board as on 31st March 2019
Category No of PercentageDirectors to total no
of Directors
Non-Executive Independent Directors 3 50Other Non-Executive Directors 3 50Total 6 100
During the year there was no change in the directorshipMr R C Mehta resigned as Non-Executive IndependentDirector of the Company with close of work on 31st March2019 keeping in view the Regulation 17(1A) of ListingRegulations 2015
Mr Mehta has confirmed that there are no other reasons forhis resignation other than stated above
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Board were held The intervening periodbetween two Board meetings was well within the maximumgap of 120 days prescribed under the Listing Regulations2015
Board Agenda
Meetings are governed by a structured agenda The Boardmembers in consultation with the Chairman may bring upany matter for the consideration of the Board All majoragenda items are backed by comprehensive backgroundinformation to enable the Board to take informed decisionsAgenda papers are generally circulated seven days prior tothe Board meeting
Information placed before the Board
The following matters are tabled for the Boardrsquos periodicreview information
bull Annual operating plans amp budgets and periodic reviewof the Companyrsquos businesses
bull Quarterly performance
bull External Audit Management Reports (through the AuditCommittee)
bull Status of legal compliance
bull Status and effectiveness of risk management plans
bull Succession to senior management (through theNominations and Remuneration Committee)
bull Statutory compliance reports
bull Show cause demand prosecution adjudicationnotices if any from revenue authorities which areconsidered materially important including anyexposure that exceeds 1 of the Companyrsquos net worthand their outcome
12
bull W rite-offs disposals (fixed assets receivablesadvances etc) on a half-yearly basis
bull Significant development in Human Resources Industrial Relations
bull Material non-compliance of any regulatory or listingrequirements and in relation to shareholdersrsquoservices
bull All other matters required to be placed before theBoard for its review information under the ListingRegulations 2015 and other statutes
Post-meeting follow-up systemThe Governance processes in the Company include aneffective post-meeting follow-up review and reportingprocess for action taken pending on decisions of the Boardand the Board Committees
Details of Board Meeting during the financial year
During the financial year ended 31st March 2019 fourmeetings of the Board were held as follows
SI Date Board No ofNo Strength Directors
present
1 17th April 2018 6 6
2 7th August 2018 6 6
3 1st November 2018 6 5
4 30th January 2019 6 5
COMMITTEES OF THE BOARD
Currently there are three Committees of the Board ndash theAudit Committee the Stakeholders RelationshipCommittee and the Nominations and RemunerationCommittee The terms of reference of the BoardCommittees are determined by the Board from time to timeMeetings of Board Committees are convened by therespective Committee Chairman All the recommendationsmade by Board Committees during the year were acceptedby the Board Minutes of Board Committee meetings areplaced before the Board for its information The role andcomposition of these Committees including the numberof meetings held during the financial year and the relatedattendance are provided below
A AUDIT COMMITTEEThe Audit Committee of the Board provides reassurance tothe Board on the existence of an effective internal controlenvironment that ensuresbull efficiency and effectiveness of operations
bull safeguarding of assets and adequacy of provisionsfor all liabilities
bull reliability of financial and other managementinformation and adequacy of disclosures
bull compliance with all relevant statutesThe role of the Committee includes the followingbull To oversee the Companyrsquos financial reporting process
and the disclosure of its financial information to
REPORT ON CORPORATE GOVERNANCE
Directorsrsquo attendance at the Board Meetings during the financial year and at the last Annual General Meeting (AGM) as alsotheir other Directorships and Committee Memberships are given below
SI Director Category No of Attendance No of No of Membership(s) No Board at last other Chairmanship(s) of Audit
Meetings AGM Directorship(s) Committee Stakeholdersattended Relationship Committee of
other Indian public limitedcompanies
1 N Anand Chairman amp 4 Yes 8 1Non-Executive Director
2 C K Koshy Non-Executive 4 Yes Nil NilIndependent Director
3 R C Mehta1 Non-Executive 2 Yes 4 NilIndependent Director
4 M Narayanan Non-Executive 4 Yes 4 4 (all as Chairman)Independent Director
5 D R Choudhary Non-Executive Director 4 Yes 1 Nil6 J Singh Non-Executive Director 4 Yes 8 3 (including 1 as Chairman)
1 Resigned as Non-Executive Independent Director wef 1st April 2019 Details with respect to other Directorships of the Directors are provided under the section lsquoYour Directorsrsquo in the Report and Accounts
13
ensure that the financial statements are correctsufficient and credible
bull To recommend the appointment remuneration termsof appointment and removal of Statutory Auditors
bull To approve transactions of the Company with relatedparties
bull To evaluate the Companyrsquos internal financial controlsand risk management systems
bull To review with the management the following
- Annual financial statements and Auditorrsquos Reportthereon before submission to the Board forapproval
- Quarterly financial statements before submissionto the Board for approval
bull To review the following
- Management discussion and analysis of financialcondition amp results of operations and mattersrequired to be included in the DirectorsrsquoResponsibility Statement
- Adequacy of internal control systems and theCompanyrsquos statement on the same prior toendorsement by the Board such review to bedone in consultation with the managementStatutory and Internal Auditors
- Adequacy of internal control systems forcompliance with the provisions of the Securitiesand Exchange Board of India (Prohibition ofInsider Trading) Regulations 2015
- Reports of Internal Audit and discussion withInternal Auditors on any significant findings andfollow-up thereon
- Statutory Auditorsrsquo independence andperformance and effectiveness of the auditprocess
- System for storage retrieval security etc of booksof account maintained in the electronic form
- Functioning of Whistleblower mechanism in theCompany
Composition
The Audit Committee as on 15th April 2019 comprisesthree Non-Executive Directors two of whom are IndependentDirectors The Chairman of the Committee is anIndependent Director The Chief Executive Officer the ChiefFinancial Officer and the representative of Statutory Auditorsare Invitees to meetings of the Audit Committee and theCompany Secretary is the Secretary to the Committee Allmembers of the Committee are financially literate twomembers including the Chairman of the Committee haveaccounting and financial management expertise
The names of the members of the Audit Committeeincluding its Chairman are provided under the sectionlsquoBoard of Directors amp Committeesrsquo in the Report andAccounts
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Audit Committee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 4 4
2 7th August 2018 4 4
3 1st November 2018 4 3
4 30th January 2019 4 3
Attendance at Audit Committee Meetings during thefinancial year
Member No of meetingsattended
M Narayanan1 4
C K Koshy 4
R C Mehta2 2
J Singh 41 Appointed Chairman wef 15th April 20192 Ceased to be Member and Chairman wef 1st April 2019
B STAKEHOLDERS RELATIONSHIP COMMITTEE
The Stakeholders Relationship Committee of the Boardoversees redressal of shareholder and investor grievancesand inter alia approves transmission of sharessub-division consolidation renewal of share certificatesissue of duplicate share certificates etc
Composition
The Stakeholders Relationship Committee presentlycomprises three Non-Executive Directors including oneIndependent Director The Chairman of the Committee is aNon-Executive Director The Company Secretary is theSecretary to the Committee
The names of the members of the StakeholdersRelationship Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 sevenmeetings of the Stakeholders Relationship Committeewere held as follows
REPORT ON CORPORATE GOVERNANCE
14
SI Date Committee No ofNo Strength Members
present1 17th April 2018 2 2
2 29th June 2018 2 2
3 7th August 2018 2 2
4 27th September 2018 2 2
5 1st November 2018 2 2
6 4th January 2019 2 2
7 30th January 2019 2 2
Attendance at Stakeholders Relationship CommitteeMeetings during the financial year
Member No of meetingsattended
J Singh 7
D R Choudhury 7
C K Koshy 0
Appointed Member wef 31st March 2019
C NOMINATIONS AND REMUNERATION COMMITTEEThe Nominations and Remuneration Committee of theBoard inter alia identifies persons qualified to becomeDirectors and formulates criteria for evaluation ofperformance of the Directors and the Board as a wholeThe Committeersquos role includes recommending to theBoard the appointment remuneration and removal ofDirectors and Key Managerial Personnel
Composition
The Nominations and Remuneration Committee as on15th April 2019 comprises four Non-Executive Directorstwo of whom are Independent Directors The Chairman ofthe Committee is an Independent Director The CompanySecretary is the Secretary to the Committee
The names of the members of the Nominations andRemuneration Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 twomeetings of the Nominations and RemunerationCommittee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 5 5
2 30th January 2019 5 4
Attendance at Nominations and Remuneration CommitteeMeetings during the financial year
Member No of meetingsattended
C K Koshy 2
N Anand 2
R C Mehta1 1
M Narayanan 2
J Singh 21 Ceased to be Member wef 1st April 2019
Remuneration Policy
The Companyrsquos Remuneration Policy aims at attractingand retaining high calibre talent The Remuneration Policytherefore is market-led and takes into account thecompetitive circumstance of each business so as to attractand retain quality talent and leverage performancesignificantly
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpwwwgujarathotels ltd in polic ies Remuneration-Policy_GHLpdf There has been no change in the Policyduring the year
Remuneration of Directors
Non-Executive Directors are entitled to sitting fees forattending the meetings of the Board and its Committeesthe quantum of which is determined by the Board Thesitting fees to Non-Executive Directors as determined bythe Board are ` 20000- and ` 10000- for each meeting ofthe Board and its Committees respectively
Details of sitting fees paid to the Directors during thefinancial year ended 31st March 2019
Director Sitting Fees (`)
C K Koshy 150000-
R C Mehta1 70000-
M Narayanan 150000-1 Resigned as Non-Executive Independent Director wef1st April 2019
Note Disclosure with respect to Non-Executive Directors ndashPecuniary relationship or transaction None
Performance Evaluation
Performance evaluation of the Board the BoardCommittees and the individual Directors was carried outby the Board in accordance with the Policy approved by theNominations and Remuneration Committee in this regardbrief details of the same are provided in the lsquoReport of theBoard of Directors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
REPORT ON CORPORATE GOVERNANCE
15
Directorsrsquo Shareholding
Details of Shareholding of the Directors in the Company ason 31st March 2019 are given below
Director No of Equity Shares of ` 10-each held singly jointly
N Anand 200
D R Choudhury Nil
C K Koshy Nil
R C Mehta Nil
M Narayanan Nil
J Singh Nil
OTHER DISCLOSURESbull Details of non-compliances penalties and strictures
by Stock Exchanges SEBI Statutory Authorities onany matter related to capital markets during the lastthree years
Nonebull Inter-se relationships between Directors and Key
Managerial Personnel of the Company
Nonebull Materially significant related party transactions which
may have potential conflict with the interests of theCompany at large
Nonebull Material financial and commercial transactions of
senior management where they may have hadpersonal interest and which had potential conflict withthe interests of the Company at large
Nonebull Details of utilisation of funds raised through
preferential allotment or qualified institutionsplacement
Not Applicablebull Credit rating(s) obtained by the Company for any debt
instrument fixed deposit programme or any otherscheme involving mobilisation of funds
Nonebull None of the Directors of the Company has been
debarred or disqualified from being appointed orcontinuing as a Director by SEBI Ministry of CorporateAffairs Statutory Authorities which has also beenconfirmed by Messrs PB amp Associates PractisingCompany Secretaries
bull Confirmation by the Board with respect to theIndependent Directors is provided in the lsquoReport ofthe Board of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Disclosures in relation to the Sexual Harassment ofWomen at Workplace (Prevention Prohibition andRedressal) Act 2013 are provided in the lsquoReport of theBoard of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Information with respect to lsquoCommodity Price Risk orForeign Exchange Risk and Hedging Activitiesrsquo
Nonebull The total fees paid by the Company to Messrs K C
Mehta amp Co Statutory Auditors and all other entitiesforming part of the same network aggregate` 100000-
bull Compliance Officer under the Listing Regulations2015
Deepak Kumar Gulati Company Secretary
MEANS OF COMMUNICATION
Timely disclosure of consistent comparable relevant andreliable information on corporate financial performance isat the core of good governance Towards this end thequarterly results of the Company were announced withinforty five days from the end of the quarter Audited annualresults along with the results for the fourth quarter wereannounced within sixty days from the end of the financialyear Extract of these results were published in lsquoTheFinancial Expressrsquo (all editions) and in its Gujarati editionas vernacular newspaper Further quarterly resultsshareholding pattern and other material events amp importantinformation relating to the Company were submitted to BSELimited through BSE Listing Centre for dissemination onits website The Company publishes its quarterlyhalf-yearly and annual financial results and also posts suchresults on its website wwwgujarathotelsltdin
The Report of the Board of Directors forming part of theReport and Accounts includes all aspects of lsquoManagementDiscussion and Analysisrsquo as required under the ListingRegulations 2015
GHL CODE OF CONDUCT FOR PREVENTION OF INSIDERTRADING ndash 2019
The GHL Code of Conduct for Prevention of Insider Tradingapproved by the Board inter alia prohibits trading insecurities of the Company by Directors and employeeswhile in possession of unpublished price sensitiveinformation in relation to the Company
GHL CODE OF CONDUCT
The GHL Code of Conduct is applicable to Directors seniormanagement and employees of the Company The Codeis derived from three interlinked fundamental principlesviz good corporate governance good corporate citizenshipand exemplary personal conduct in relation to theCompanyrsquos business and reputation The Code coversGHLrsquos commitment to sustainable development concern
REPORT ON CORPORATE GOVERNANCE
16
for occupational health safety and environment a genderfriendly workplace transparency and auditability legalcompliance and the philosophy of leading by personalexample The Code is available on the Companyrsquos website
Declaration as required under the Listing Regulations 2015All Directors and senior management of the Companyhave affirmed compliance with the GHL Code of Conductfor the financial year ended 31st March 2019New Delhi K Pahwa15th April 2019 CEO
WHISTLEBLOWER POLICYSynopsis of the Whistleblower Policy of the Company isprovided in the lsquoReport of the Board of Directors ampManagement Discussion and Analysisrsquo forming part of theReport and Accounts The Whistleblower Policy is alsoavailable on the Companyrsquos websiteFAMILIARISATION PROGRAMME FOR DIRECTORSGHL believes that a Board which is well informed familiarised with the Company and its affairs can contributesignificantly to effectively discharge its role of trusteeshipin a manner that fulfils stakeholdersrsquo aspirations andsocietal expectations In pursuit of this the Directors of theCompany are updated on changes developments in thedomestic global corporate and industry scenario includingthose pertaining to statutes legislations and economicenvironment and on matters affecting the Company toenable them to take well informed and timely decisionsFurther details may be accessed on the Companyrsquos websiteat httpwwwgujarathotelsltdinpoliciesDirectorrsquos-Familiarisation-programmespdfPOLICY ON RELATED PARTY TRANSACTIONSThe Policy as approved by the Board may be accessed onthe Companyrsquos website at
h t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_TranscationspdfDISCRETIONARY REQUIREMENTS UNDER THE LISTINGREGULATIONS 2015The status of compliance with the discretionaryrequirements under the Listing Regulations 2015 isprovided below1 Chairmanrsquos Office The Company has a Non-Executive
Chairman but he does not maintain any separate officeand hence no expense in this regard is being incurredby the Company
2 Shareholder Rights The quarterly half-yearly andannual financial results of the Company are postedon the Companyrsquos website and extract of these resultsare published in newspapers on an all India basisThe complete Report and Accounts is sent to everyShareholder of the Company
3 Audit Opinion It has always been the Companyrsquosendevour to present financial statements with
unmodified audit opinion The Statutory Auditors haveissued an unmodified audit opinion on the Companyrsquosfinancial statements for the year ended 31st March2019
4 Separate posts of Chairman and Chief ExecutiveOfficer The Company has a Non-Executive Chairmanand a Chief Executive Officer
5 Internal Audit The Internal Auditor of the CompanyMessrs Shah amp Talati Chartered Accountants reportsto the Audit Committee of the Board
GENERAL SHAREHOLDER INFORMATIONProvided in the lsquoShareholder Informationrsquo section of theReport and Accounts
CONFIRMATION OF COMPLIANCEbull It is confirmed that the Company has complied with
the requirements prescribed under Regulations 17 to27 and clauses (b) to (i) of sub - regulation (2) ofRegulation 46 of the Listing Regulations 2015
bull The Statutory Auditorsrsquo Certificate that the Companyhas complied with the conditions of CorporateGovernance is annexed to the lsquoReport of the Board ofDirectors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
ANNEXURE TO THE REPORT ON CORPORATEGOVERNANCESKILLS EXPERTISE AND COMPETENCIES OF DIRECTORSThe Company believes that Board members should havea balance of skills experience and diversity of perspectivesappropriate to the Company Accordingly the Directorsshould possess one or more of the following skillsexpertise and competencies
1 Leadership
Leadership experience in a commensurate-sizedorganisation with understanding of organisationalsystems and processes strategic areas andemerging business trends
2 Industry Knowledge and Experience
Domain knowledge of Hotel business and itsdynamics long-term strategies and regulatory ampcompetitive environment
3 Finance and Accounting
Ability to understand financial policies accountingstatements and disclosure practices to contribute tothe financial risk management policies and practicesof the Company
4 Governance
Commitment belief and experience in settinggovernance practices to support the Companys legalcompliance systems and governance polic ies practices
REPORT ON CORPORATE GOVERNANCE
17
SHAREHOLDER INFORMATION
AGM Details
Date Saturday 7th September 2019Venue WelcomHotel Vadodara R C Dutt Road
Alkapuri Vadodara 390 007Time 1100 amBook Friday 30th August 2019 toClosure Saturday 7th September 2019Dates (both days inclusive)Dividend Friday 13th September 2019PaymentDate
Registrar and Share Transfer Agents
Messrs MCS Share Transfer Agent Limited are the Registrarand Share Transfer Agents (RTA) of the Company forcarrying out share registration and other related activitiesof the Company
Address for Correspondence
MCS Share Transfer Agent LimitedF-65 1st Floor Okhla Industrial AreaPhase ndash I New Delhi - 110 020Telephone Nos 011 4140 6149-52 4160 9386Facsimile No 011 4170 9881E-mail helpdeskdelhimcsregistrarscom
Shareholders holding shares in the dematerialised formshould address their correspondence except those relatedto dividend to their respective Depository Participants
Share Transfer Committee
The Share Transfer Committee of the Company generallymeets once in ten days for approving share transfers Theprocessing activities with respect to requests received forshare transfers are completed within fifteen days from thedate of receipt of request The Committee met 11 timesduring the financial year ended 31st March 2019 to approveshare transfers There were no share transfers pendingas on 31st March 2019
The Share Transfer Committee presently comprises thefollowing
D R Choudhury - Director MemberJ Singh - Director MemberM Agarwal - Compliance Officer Member
Dematerialisation of Shares and Liquidity
The shares of the Company are available for trading in thedematerialised form under both the Depository Systems inIndia - NSDL and CDSL The International SecuritiesIdentification Number (lSIN) allotted to the Companysshares under the Depository System is INE621C01011
As on 31st March 2019 a total of 3525013 Equity Sharesof the Company which translates to 9307 of the ShareCapital stood dematerialised The processing activitieswith respect to requests received for dematerialisation arecompleted between fifteen to thirty daysShareholder Investor ComplaintsThe Company attends to Shareholder Investor complaintsqueries and other correspondence generally within fifteendays except where constrained by disputes or legalimpedimentsThe Company did not receive any complaint during thefinancial year ended 31st March 2019The e-mail ID earmarked by the Company for this purposeghlinvestorsyahoocoinDistribution of Shareholding as on 31st March 2019
No of No of EquityNo of Shareholders Shares
SharesSlab Total to Total to
Share Shareholders Capital
1 - 500 5152 9455 587438 1551501 - 1000 138 253 112061 296
1001 - 2000 68 125 100167 2652001 - 3000 26 048 62030 1643001 - 4000 16 029 58804 1554001 - 5000 11 020 50785 1345001 - 10000 23 042 163405 431
10001 - 50000 8 015 147787 39050001 - 100000 3 006 226954 599
100001 amp Above 4 007 2278084 6015Total 5449 10000 3787515 10000
Categories of Shareholders as on 31st March 2019Sl Category No of toNo Shares Share
held hold ingA Promoter Holding1 Promoter and Promoter Group
ITC Limited 1733907 4578Russell Investments Limited 300056 792Sub-Total 2033963 5370
B Non Promoter Holding2 Institutional Investorsa Mutual Funds NIL NILb Banks 100 000c Foreign Institutional Investors and NIL NIL
Foreign Portfolio InvestorsSub-Total 100 000
3 Othersa Private Corporate Bodies 193726 511b Indian Public 1335461 3527c NRIs 102362 270d Others 121903 322
Sub Total 1753452 4630Grand Total 3787515 10000
18
Monthly High and Low Quotes and Volume of Sharestraded on BSE Limited
Year Month High L o w Volume(` ) (` ) (Nos)
2018 April 13800 12000 93584May 13100 11710 26778June 12735 11500 18090July 12195 11400 27113August 12295 11450 14900September 12000 10900 23492October 11400 10505 18787November 12975 10700 15386December 11490 10700 40291
2019 January 11320 10700 22160February 11185 10005 12395March 11295 10400 21625
Performance in comparison to broad based indices suchas SampP BSE Sensex
Note - Indicates monthly closing positions
Listing of Shares on Stock Exchange (with Stock Code)BSE Limited (507960)Phiroze Jeejeebhoy Towers Dalal Street Mumbai 400 001Telephone Nos 022-2272 1233 34Facsimile No 022-2272 1919E-mail isbseindiacomWebsite wwwbseindiacom
The Listing Fee for the financial year 2019-20 has beenpaid to BSE Limited
Financial CalendarFinancial Year 2019-20(1st April - 31st March)
1 First Quarter Results July 20192 Second Quarter and October November 2019
Half-Year Results3 Third Quarter Results January February 20204 Fourth Quarter and May 2020
Annual Results
Particulars of past three AGMsAGM Financial Venue Date Time Special
Year ResolutionPassed
36th 2017-18 WelcomHotel 07-08-2018 NoneVadodara
35th 2016-17 R C Dutt Road 08-08-2017 1100 NoneAlkapuri am
34th 2015-16 Vadodara 20-09-2016 None390 007
Postal Ballot
No special resolution requiring postal ballot was eitherproposed last year or is being proposed for the ensuing AGM
SHAREHOLDER REFERENCER
Transfer of Shares in certificate form
Effective 1st April 2019 transfer of shares of a listedcompany can only be effected in dematerialised form interms of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 Shareholders holdingshares in the certificate form are therefore requested todematerialise their shares in their own interestCommunication in this respect has been sent by theCompany during the year to the concerned ShareholdersHowever transfer deeds which were lodged with theCompany on or before 31st March 2019 but were returneddue to any deficiency will be processed upon re-lodgement
Transfer of Dividend and corresponding Equity Shares tothe Investor Education and Protection Fund (IEPF)
During the financial year 2018-19 unclaimed dividend forthe financial year 2010-11 aggregating ` 636444- andthe corresponding 13150 Equity Shares in respect of whichdividend entitlements remained unclaimed for sevenconsecutive years or more have been transferred by theCompany to the IEPF established by the CentralGovernment pursuant to the provisions of Section 124 ofthe Companies Act 2013 read with the Investor Educationand Protection Fund Authority (Accounting Audit Transferand Refund) Rules 2016
Shareholders may claim their unclaimed dividend for theyears prior to and including the financial year 2010-11 andthe corresponding shares from the IEPF Authority byapplying in the prescribed Form No IEPF-5 This Form canbe downloaded from the website of the IEPF Authoritywwwiepfgovin the access link of which is also availableon the Companys website wwwgujarathotelsltdin underthe section General Information under Shareholder Value
The unclaimed dividend for the undernoted years and thecorresponding shares will be transferred by the Companyto the IEPF in accordance with the schedule given belowAttention in particular is drawn that the unclaimed dividendfor the financial year 2011-12 and the corresponding shareswill be due for transfer to the IEPF on 14th September
SHAREHOLDER INFORMATION
19
Central Depository Services (India) LimitedMarathon Futurex A Wing 25th FloorMafatlal Mill Compound N M Joshi MargLower Parel Mumbai 400 013Telephone No 022-2302 3333Facsimile No 022-2300 2035E-mail helpdeskcdslindiacomWebsite wwwcdslindiacomRemittance of Dividend through Electronic ModeThe Company provides the facility for remittance of dividendto Shareholders through RTGS (Real Time GrossSettlement) NACH (National Automated Clearing House) NEFT (National Electronic Funds Transfer)
Shareholders who have not opted for remittance of dividendthrough electronic mode and wish to avail the same arerequired to provide their bank details including IFSC (IndianFinancial System Code) and MICR (Magnetic Ink CharacterRecognition) to their respective Depository Participants(DPs) or to the RTA where shares are held in thedematerialised form and in the certificate form respectively
Shareholders holding shares in the certificate form mayuse the Mandate Form for this purpose which can bedownloaded from the Companys websitewwwgujarathotelsltdin under the section GeneralInformation under Shareholder Value
Address and Bank DetailsShareholders holding shares in the certificate form arerequested to advise the RTA of any change in their address mandate bank details to facilitate better servicingShareholders are advised that as a measure of protectionagainst fraudulent encashment their bank details oraddress as available with the RTA will be printed on thedividend warrants or demand drafts where dividend cannotbe remitted through electronic mode
Permanent Account Number (PAN)Shareholders holding shares in the certificate form arerequested to send copies of their PAN Cards to the RTA tofacilitate better servicing
Furnishing of PAN Card however is mandatory as followsi) Transferees and Transferors PAN Cards for transfer
of sharesii) Legal heirs Nominees PAN Cards for transmission
of sharesiii) Surviving joint holders PAN Cards for deletion of name
of deceased Shareholders andiv) Joint holders PAN Cards for transposition of shares
Nomination Facility
Shareholders who hold shares in the certificate form andwish to make any nomination change nomination madeearlier in respect of their shareholding in the Companyshould submit to the RTA the prescribed Form such Formcan be downloaded from the Companys website underthe section Investor Relations under Shareholder Value
SHAREHOLDER INFORMATION
2019 for which purpose communication has been sent tothe concerned Shareholders advising them to write to theCompany to claim their dividend Notices in this regardhave also been published in newspapers Details of suchunclaimed dividend and corresponding shares areavailable on the Companys website under the sectionGeneral Information under Shareholder Value
Financial Date of declaration Due date for transferYear of Dividend to IEPF2011-12 8th August 2012 14th September 2019
2012-13 13th August 2013 19th September 2020
2013-14 29th September 2014 5th November 2021
2014-15 29th September2015 5th November 2022
2015-16 20th September 2016 26th October 2023
2016-17 8th August 2017 14th September 2024
2017-18 7th August 2018 12th September 2025
The Company will not be able to entertain any claim receivedafter 12th September 2019
Shareholders who have not so far encashed their dividendwarrant(s) or have not received the same are requested toapply for duplicate warrant(s) by writing to the Companyand confirming non-encashment non-receipt of dividendwarrant(s)
Service of Documents
The Company sends Notices Report and Accounts andother communications in electronic mode to thoseShareholders who have registered their e-mail addresseswith the Company or with the Depositories and in physicalmode to the other Shareholders
Shareholders who wish to register or update their e-mailaddresses with the Company may use the Form forregistration updation which can be downloaded from theCompanys website under the section Investor Relationsunder Shareholder Value
Depository Services
Shareholders may write to the respective Depository or tothe RTA for guidance on depository services
The contact details of the Depositories are given below
National Securities Depository LimitedTrade World A Wing 4th FloorKamala Mills CompoundSenapati Bapat Marg Lower ParelMumbai 400 013Telephone No 022-2499 4200Facsimile No 022-2497 6351E-mail infonsdlcoinWebsite wwwnsdlcoin
20
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
FOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019Your Directors submit their Report for the financial yearended 31st March 2019
BUSINESS ENVIRONMENT
The global economic growth softened to 36 in 2018representing a marked slowdown compared to the 39growth anticipated at the beginning of the year buoyed bya strong fiscal expansion in the USA which was offset largelyby slower growth in some other large economies ieEurope Japan etc Going forward global growth in 2019 isprojected to decline further to 33 in the base case withrisks to the downside emanating from politicaluncertainties rising trade tensions escalatingprotectionism and tighter financial conditions
As per Ministry of Statistics amp Programme Implementation(MSPI) Indian economy registered the GDP growth of 7in 2018-19 as compared to 72 in 2017-18 The economyis expected to grow and maintain a level of 75 in 2019and 2020 as per the World Bank estimates
India is the most digitally-advanced traveller nation in termsof digital tools being used for planning booking andexperiencing a journey During 2018 foreign tourist arrivals(FTAs) in India stood at 1056 million achieving a growthrate of 52 year-on-year The Government of India is alsoworking to achieve 1 share in worldrsquos international touristarrivals by 2020 and 2 share by 2025
The operating environment in the hospitality sector showedimprovement with foreign tourist arrivals Indiarsquos risingmiddle class and increasing disposable incomes havecontinued to support the growth of domestic tourism
With the inauguration of Statue of Sardar Vallabhbhai Patelalso known as lsquoStatute of Unityrsquo which is the higheststanding statue in the world at a height of 182 meters thetourism in the city of Vadodara is expected to grow
FINANCIAL PERFORMANCE
During the year under review your Company earned licensefees of ` 36987 lakhs (previous year ` 33098 lakhs)Theother income at ` 19626 lakhs showed an increase mainlydue to improvement in return on current investment Preand post-tax profits increased to ` 51822 lakhs (previousyear ` 45313 lakhs) and ` 40788 lakhs (previous year` 33690 lakhs) respectively
Your Directors are pleased to recommend a dividend of` 350 per Equity Share of ` 10- each for the year ended31st March 2019 thereby maintaining last yearrsquos dividendand involving a cash outflow of ` 160 lakhs includingDividend Distribution Tax of ` 27 Lakhs
PROFITS DIVIDEND AND RETAINED EARNINGS
The financial results of your Company summarised areas under
For the year ended For the year ended31st March 2019 31st March 2018
Profits (` ) (` )
a Profit Before Tax 51822363 45312928
b Tax Expense
Current Tax 11653499 9272310Deferred Tax (618755) 2350502
c Profit for the year 40787619 33690116
d Other Comprehensive Income - -
e Total Comprehensive Income 40787619 33690116
Statement of Retained Earningsa At the beginning of the year 213211090 195873461
b Add Total Comprehensive Income 40787619 33690116
c Less Dividend paid including IncomeTax on Dividend paid 15981176 15954974
d Less Income Tax on Dividend paid forearlier year - 397513
e At the end of the year 238017533 213211090
Your Directors are pleased to recommend a dividend of` 350 per Equity Share (Previous Year ` 350) of ` 10-each for the year ended 31st March 2019
Details of changes in Key Financial Ratio amp Return onNet Worth
The key financial ratio of the Company where there hasbeen significant change (25 or more) and change inReturn on Net Worth are summarized below pursuant toSchedule V (B) to the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements)Regulations 2015 (Listing Regulations 2015)
HOTEL OPERATIONS
Your Hotel WelcomHotel Vadodara licensed to ITC Limitedrecorded an income of ` 249443 lakhs during the year ascompared to ` 221856 lakhs in the previous year Therewas an improvement in both occupancy and average roomrates leading to an overall improvement in HotelPerformance
Financial Ratio
2018-19 2017-18 Change
Reason for change
Current Ratio
278 223 25 Increase in value of current investment based on accumulation of market return and fresh investment done during the year out of surplus funds
Return on Net Worth
133 120 11 Due to higher rate of growth in profit after tax
21
The Food amp Beverage segment of your Companyrsquos Hotelcontinues to be a major strength The Peshawri Restaurantand the Welcom Cafeacute Cambay both retained their premiumleadership positions
Your Company has filed a writ petition in the Gujarat HighCourt seeking that the Gujarat State Government be directedto take action on your Companyrsquos application to have theleasehold land of the Hotel converted to freehold andtransferred to your Company as per the existing governmentpolicy in this regard The Honourable High Court passedan Order on 24th December 2014 restraining the StateGovernment from disturbing the peaceful and actualpossession of the Company over the hotel property in anymanner including construction thereon The writ petition ispending
Your Company is also making all efforts for expeditiousconversion of land from leasehold to freehold or in thealternative extension of Lease For further details pleaserefer to Note no 20A of the Accounts
SUBSIDIARIES ASSOCIATES AND JOINT VENTURES
The Company does not have any subsidiary associate orjoint venture
INTERNAL FINANCIAL CONTROLS
Your Company is managed by the Board of Directors andthe Executive Management with clearly defined rolesresponsibilities and authorities The Executive Managementis responsible for the day-to-day conduct of the affairs ofthe Company within the overall framework approved by theBoard Your Company also has a Code of Conduct whichrequires management to conform to the required financialand accounting policies systems and processes conductbusiness ethically and ensure strict compliance with allapplicable laws and regulations Ongoing ReviewProcesses and the Risk Management Framework create acontrol environment in the Company and provide thecornerstones for Internal Financial Controls with referenceto your Companyrsquos Financial Statements
Your Companyrsquos Financial Statements are prepared on thebasis of the Significant Accounting Policies that are carefullyselected by the management and approved by the AuditCommittee and the Board These Policies are reviewedand updated from time to time and audited by the InternalAuditor whose findings and recommendations are reviewedby the Audit Committee and tracked through toimplementation
Your Company maintains its Books of Account in electronicform Your Company has in place adequate internalfinancial controls with reference to the FinancialStatements
The Internal Auditors of the Company evaluates theadequacy and efficacy of such internal financial controlsSuch controls have been assessed during the year by the
management Based on the results of this assessmentno reportable material weakness or significant deficienciesin the design or operation of internal financial controls wereobserved Nonetheless your Company recognises that anyinternal financial control framework no matter how welldesigned has inherent limitations and accordingly regularaudit and review processes ensure that such systems arereinforced on an ongoing basis
RISK MANAGEMENT
Your Company continues its emphasis on a systems-basedapproach to business risk managementBacked by stronginternal control systems the current Risk Managementframework consists of the following key elements
- The Board of Directors (lsquoThe Boardrsquo) has clearly laiddown the roles and responsibilities of the Company inrelation to risk management covering a range ofresponsibilities from strategic to operational Theserole definitions provide the foundation for yourCompanyrsquos Risk Management Policy that is endorsedby the Board and is aimed at ensuring formulation ofappropriate risk management procedures theireffective implementation and independent monitoringand reporting by Internal Audit
- Management of risks vest with the ExecutiveManagement which is responsible for the day-to-dayconduct of the affairs of the Company within the overallframework approved by the Board
- A combination of policies and procedures which areregularly reviewed and updated in the light of changingbusiness and regulatory environment bringsrobustness to the process of ensuring that businessrisks are effectively addressed
- Appropriate structures are in place to proactivelymonitor and manage the inherent risks in businesswith unique relatively high risk profiles
- An Independent Internal Audit Firm carries out riskfocused audits enabling identification of areas whererisk management processes may need to bestrengthened
- The Audit Committee of the Board reviews the InternalAudit findings and provides strategic guidance oninternal controls The Chief Executive Officer closelymonitors the internal control environment within yourCompany including implementation of the action plansemerging out of internal audit findings
The combination of policies and processes as outlinedabove adequately address the various risks associatedwith your Companyrsquos business
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
22
AUDIT AND SYSTEMS
Your Company believes that internal control is a necessaryadjunct to the principle of governance that freedom ofmanagement should be exercised within a framework ofappropriate checks and balances Your Company remainscommitted to ensuring an effective internal controlenvironment that provides assurance and comfort on orderlyand efficient conduct of operations security of assetsprevention and detection of frauds errors accuracy andcompleteness of accounting records and timely preparationof reliable financial information
Your Companyrsquos independent and robust Internal Auditprocesses provide assurance on the adequacy andeffectiveness of internal controls compliance withoperating systems internal policies and regulatoryrequirements
The Internal Audit function consisting of an outsourcedprofessional firm is adequately resourced to deliver highstandards of audit assurances
The Audit Committee of your Board met four times duringthe year The Terms of Reference of the Audit Committeeincluded reviewing the adequacy and effectiveness of theinternal control environment monitoring implementationof the action plans emerging out of Internal Audit findingsincluding those relating to strengthening of your Companyrsquosrisk management systems and discharge of statutorymandate
HUMAN RESOURCE DEVELOPMENT
Your Company firmly believes that employees are the vitaland most valuable assets and hence has created afavourable work environment that encourages innovationand meritocracy Your Company continues to innovate inthe way human resources are managed and developedstriking a balance between business needs and individualaspirations
With an undying commitment to render delightful servicesyour Companyrsquos employees consistently work towardsdelivering flawless performance and are continuing todelight customers
The Company provides a safe secure inclusive and genderfriendly workplace The Company has put in placeGrievance Redressal Procedures and adopted a Policy onSexual Harassment as per the provisions of the SexualHarassment of W omen at W orkplace (PreventionProhibition and Redressal) Act 2013 and the Rules framedthereunder The Company has an Internal ComplaintsCommittee to ensure that grievances in this regard if anyare effectively addressed During the year under review nocomplaint relating to sexual harassment has beenreceived
WHISTLEBLOWER POLICY
The Companyrsquos W histleblower Policy encouragesDirectors and employees to bring to the Companyrsquosattention instances of unethical behavior actual orsuspected incidents of fraud actual or suspectedinstances of leak of unpublished price sensitive informationor violation of the GHL Code of Conduct that could adverselyimpact the Companyrsquos operations business performanceand or reputation The Policy provides that the Companyinvestigates such incidents when reported in an impartialmanner and takes appropriate action to ensure that therequisite standards of professional and ethical conductare always upheld It is the Companyrsquos Policy to ensurethat no employee is victimised or harassed for bringingsuch incidents to the attention of the Company
The practice of the Whistleblower Policy is overseen by theAudit Committee and no employee has been denied accessto the Committee The Whistleblower Policy is available onthe Companyrsquos website at httpwwwgujarathotelsltdinCorporateGovernancehtml
DEPOSITS
Your Company has not accepted any deposits from thepublic members under Section 73 of the Companies Act2013 (lsquothe Actrsquo) read with the Companies (Acceptance ofDeposits) Rules 2014 during the year
DIRECTORS
Changes in Directors
Mr R C Mehta stepped down as Non-Executive IndependentDirector of the Company with effect from close of work on31st March 2019 keeping in view the Regulation 17(1A) ofthe Listing Regulations 2015 Your Directors would like torecord their appreciation for the services rendered byMr Mehta
The Board at the meeting held on 15th April 2019 on therecommendation of the Nominations and RemunerationCommittee recommended for the approval of the Membersthe re-appointment of Mr C K Koshy and Mr M Narayananas independent directors of your Company in terms ofSection 149 of the Act and Regulation 17 of the ListingRegulations 2015 with effect from 29th September 2019
Requisite Notices under Section 160 of the Act have beenreceived in respect of Messrs Koshy and Narayanan whohave filed their consents to act as Directors of the Companyif appointed
Appropriate resolutions seeking your approval to theaforesaid appointment will appear in the Notice conveningthe Thirty Seventh AGM of your Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
23
Retirement by Rotation
In accordance with the provisions of Section 152 of the Actread with Article 147 of the Articles of Association of theCompany Mr Jagdish Singh will retire by rotation at theensuing Annual General Meeting (lsquoAGMrsquo) of your Companyand being eligible offers himself for re-election Your Boardrecommends his re-election
Number of Board Meetings
During the year ended 31st March 2019 four meetings ofthe Board were held
Attributes Qualifications amp Independence of Directorsand their Appointment
As reported last year the Nominations and RemunerationCommittee of the Board had approved the criteria fordetermining qualifications positive attributes andindependence of Directors in terms of the Act and the Rulesthereunder both in respect of Independent Directors andother Directors as applicable The criteria inter aliarequires that NonndashExecutive Directors includingIndependent Directors be drawn from amongst eminentprofessionals with experience in business finance law public administration and enterprises
The Board Diversity Policy of the Company requires theBoard to have a balance of skills experience and diversityof perspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the lsquoReport on CorporateGovernancersquo forming part of the Report and Accounts TheArticles of Association of the Company provide that thestrength of the Board shall not be fewer than three normore than twelve
Directors are appointed re-appointed with the approval ofthe Members All Directors other than IndependentDirectors are liable to retire by rotation unless otherwiseapproved by the Members One-third of the Directors whoare liable to retire by rotation retire every year and areeligible for re-election
The Independent Directors of your Company haveconfirmed that (a) they meet the criteria of independenceas prescribed under Section 149 of the Act and Regulation16 of the Listing Regulations 2015 and (b) they are notaware of any circumstance or situation which could impairor impact their ability to discharge duties with an objectiveindependent judgement and without any external influenceFurther in the opinion of the Board the IndependentDirectors fulfil the conditions prescribed under the ListingRegulations 2015 and are independent of the managementof the Company
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpw w wg u j a ra th o te ls l td in p o l i c ies R em u n era t io n -
Policy_GHLpdf There has been no change in the Policyduring the year
Board Evaluation
The Nominations and Remuneration Committee hasapproved the Policy on Board Evaluation Evaluation ofBoard Committeesrsquo functioning and individual DirectorEvaluation and also specified that such evaluation will bedone by the Board Board performance is assessed againstthe role and responsibilities of the Board as provided inthe Act and the Listing Regulations 2015 The parametersfor Board performance evaluation have been derived fromthe Boardrsquos core role of trusteeship to protect and enhanceshareholder value as well as fulfil expectations of otherstakeholders through strategic supervision of the CompanyEvaluation of functioning of Board Committees is basedon discussions amongst Committee members and sharedby each Committee Chairman with the Board IndividualDirectors are evaluated in the context of the role played byeach Director as a member of the Board at its meetingsand in assisting the Board in realising its role of strategicsupervision of the functioning of the Company in pursuit ofits purpose and goals
While the Board evaluated its performance against theparameters laid down by the Nominations andRemuneration Committee the evaluation of individualDirectors was carried out anonymously in order to ensureobjectivity The Board was briefed on functioning of BoardCommittees by the respective Committee Chairmen
Key Managerial Personnel
Mr Deependra Rana resigned as the Chief Executive Officerof the Company with effect from 17th December 2018
The Board at the meeting held on 30th January 2019 onthe recommendation of the Nominations andRemuneration Committee appointed Mr Kunal Pahwa asthe Chief Executive Officer of the Company with effect from1st February 2019
AUDIT COMMITTEE amp AUDITORS
The composition of the Audit Committee is provided underthe section lsquoBoard of Directors amp Committeesrsquo in the Reportand Accounts
Statutory Auditors
The Statutory Auditors Messrs K C Mehta amp Co CharteredAccountants (KCM) were appointed with your approval atthe Thirty Fifth AGM to hold such office till the conclusion ofthe Fortieth AGM
On the recommendation of the Audit Committee the Boardrecommended for the approval of the Members paymentof remuneration of KCM for the financial year 2019-20Appropriate resolution for this purpose will appear in theNotice convening the Thirty Seventh AGM of the Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
24
Secretarial Auditors
Your Board appointed Messrs PB amp Associates CompanySecretaries to conduct the secretarial audit of the Companyfor the financial year ended 31st March 2019 Their Reportis provided in the Annexure forming part of this Report interms of Section 204 of the Act
RELATED PARTY TRANSACTIONS
All contracts or arrangements entered into by the Companywith its related parties during the financial year were inaccordance with the provisions of the Act and the ListingRegulations 2015 All such contracts or arrangements wereentered in the ordinary course of business and on armrsquoslength basis and have been approved by the AuditCommittee
Further the details of related party transactions of theCompany in prescribed Form No AOC-2 in terms of Section134 of the Act read with Rule 8 of the Companies (Accounts)Rules 2014 is given in the Annexure to this Report YourCompanyrsquos Policy on Related Party Transactions asadopted by your Board can be accessed on the website ath t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_Transactionspdf
DIRECTORSrsquo RESPONSIBILITY STATEMENT
As required under Section 134 of the Act your Directorsconfirm having
a) followed in the preparation of the Annual Accounts theapplicable Accounting Standards with properexplanation relating to material departures if any
b) selected such accounting policies and applied themconsistently and made judgements and estimates thatare reasonable and prudent so as to give a true andfair view of the state of affairs of your Company at theend of the financial year and of the profit of yourCompany for that period
c) taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with theprovisions of the Act for safeguarding the assets ofyour Company and for preventing and detecting fraudand other irregularities
d) prepared the Annual Accounts on a going concernbasis
e) laid down internal financial controls to be followed byyour Company and that such internal financial controlswere adequate and operating effectively and
f) devised proper systems to ensure compliance withthe provisions of all applicable laws and that suchsystems were adequate and operating effectively
OTHER INFORMATION
Compliance with the conditions of Corporate Governance
The certificate of the Statutory Auditors Messrs K C Mehtaamp Co Chartered Accountants confirming compliance withthe conditions of Corporate Governance as stipulated underthe Listing Regulations 2015 is annexed
Compliance with Secretarial Standards
The Company is in compliance with the applicableSecretarial Standards issued by the Institute of CompanySecretaries of India and approved by the CentralGovernment under Section 118 of the Act
Cost Records
The Company is not required to maintain cost records interms of Section 148 of the Act read with the Companies(Cost Records and Audit) Rules 2014
Going Concern Status
There is no significant or material order passed during theyear by any regulator court or tribunal impacting the goingconcern status of the Company or its future operations
Extract of Annual Return
The information required under Section 134 of the Act readwith Rule 12 of the Companies (Management andAdministration) Rules 2014 is annexed
Particulars of Loans Guarantees or Investments
During the year ended 31st March 2019 the Company hasneither given any loan or guarantee nor has made anyinvestment under the provisions of Section 186 of the Act
Particulars relating to Conservation of Energy andTechnology Absorption
Particulars as required under Section 134 of the Act relatingto Conservation of Energy and Technology Absorption areprovided below-
Conservation of Energy
Steps taken on conservation of energy and impact thereof
Sl DescriptionNo
1 Installation of energy efficient Gas Burners and Induction Cooker
2 Improvement in energy usage efficiency in lighting system by changingover to efficient lighting solutions such as Light Emitting Diodes
3 Replacement of existing motors and pumps with more energy efficientequipment
4 Process improvement to enhance productivity and reduce specificenergy consumption
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
25
There were no employees who were employed throughoutthe year and were in receipt of remuneration aggregating` 102 crores or more or were employed for part of the yearand were in receipt of remuneration aggregating ` 850lakhs per month or more during the financial year ended31st March 2019
The information pursuant to Section 197 of the Act readwith Rule 5(2) and 5(3) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014containing the names of top 10 employees in terms ofremuneration drawn is provided in the Annexure formingpart of this report
The information required under Section 197(12) of the Actand the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is provided in theAnnexure forming part of this Report
FORWARD-LOOKING STATEMENTS
This Report contains forward-looking statements thatinvolve risks and uncertainties When used in this Reportthe words lsquoanticipatersquo lsquobelieversquo lsquoestimatersquo lsquoexpectrsquo lsquointendrsquolsquowillrsquo and other similar expressions as they relate to theCompany and or its Businesses are intended to identifysuch forward-looking statements The Companyundertakes no obligation to publicly update or revise anyforward-looking statements whether as a result of newinformation future events or otherwise Actual resultsperformances or achievements could differ materially fromthose expressed or implied in such forward-lookingstatements Readers are cautioned not to place unduereliance on these forward-looking statements that speakonly as of their dates This Report should be read inconjunction with the financial statements included hereinand the notes thereto
CONCLUSION
Your Directors and employees look forward to the futurewith confidence and stand committed to creating an evenbrighter future for all stakeholders
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
Steps taken by the Company for utilising alternate sourcesof energy NIL
Capital investment on energy conservation equipment NIL
Technology Absorption
i) Efforts in brief made towards technology absorptionand benefits derived as a result of the above effortseg product improvement cost reduction productdevelopment import substitution etc
Sl Description BenefitsNo
1 Upgradation of Fire Alarm and For Product UpgradationPublic Announcement system
2 Installation of Hoods and Fire For Product UpgradationSuppression system
3 Upgradation of CCTV monitoring For Product Upgradationsystem
4 Upgradation of Electrical Panel For Product Improvement5 Induction of Diesel Generator For Product Improvement
ii) In case of imported technology (imported during thelast 3 years reckoned from the beginning of the financialyear) following information may be furnished
A) Details of technology imported - NIL
B) Year of import - NIL
C) Whether the technology has been fully absorbed -NIL
D) If not fully absorbed areas where absorption hasnot taken place and the reasons therefor - NIL
iii) Expenditure incurred on research and development -NIL
FOREIGN EXCHANGE EARNINGS AND OUTGO
During the financial year 2018-19 foreign exchangeearnings of the Hotel aggregated ` 111754 lakhs (previousyear ` 95887 lakhs) while expenditure in foreign currencyaggregated ` 5514 lakhs (previous year ` 3230 lakhs)
EMPLOYEES
The total number of employees of the Company as on31st March 2019 stood at 198
26
ANNEXURE
FORM NO MR ndash 3SECRETARIAL AUDIT REPORTFOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019[Pursuant to Section 204(1) of the Companies Act 2013 and Rule9 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014]
ToThe MembersGujarat Hotels LimitedWe have conducted the secretarial audit of the compliance ofapplicable statutory provisions and the adherence to goodcorporate practices by Gujarat Hotels Limited a Companyincorporated under the provisions of the Companies Act 1956 andhaving its Registered Office at WelcomHotel Vadodara R C DuttRoad Alkapuri Vadodara Gujarat ndash 390 007 (hereinafter referredto as the lsquoCompanyrsquo) for the period commencing from 1st April2018 till 31st March 2019 (hereinafter referred to as the lsquoAuditPeriodrsquo) Secretarial Audit was conducted in a manner that providedus a reasonable basis for evaluating the corporate conducts statutory compliances and expressing our opinions thereonBased on our verification of the books papers minute booksforms and returns filed and other records maintained by theCompany and also the information provided by the Company itsofficers agents and authorised representatives during the conductof Secretarial Audit 2018-19 we hereby report that in our opinionthe Company has during the audit period covering the FinancialYear ended on 31st March 2019 complied with the statutoryprovisions listed hereunder and also that the Company has properBoard-processes and compliance-mechanism in place to theextent in the manner and subject to the reporting made hereinafterWe have examined the books papers minute books forms andreturns filed and other records maintained by the Company for thefinancial year ended on 31st March 2019 according to theprovisions of(i) The Companies Act 2013 (the Act) and the Rules made
thereunder(ii) The Securities Contracts (Regulation) Act 1956 (lsquoSCRArsquo)
and the Rules made thereunder(iii) The Depositories Act 1996 and the Regulations and
Bye-laws framed thereunder(iv) Foreign Exchange Management Act 1999 and the Rules and
Regulations made thereunder to the extent of Foreign DirectInvestment Overseas Direct Investment and ExternalCommercial Borrowings
(v) The following Regulations and Guidelines prescribed underthe Securities and Exchange Board of India Act 1992(lsquoSEBI Actrsquo)-(a) The Securities and Exchange Board of India
(Substantial Acquisition of Shares and Takeovers)Regulations 2011
(b) The Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations 2015
(c) The Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations2015
(d) The Securities and Exchange Board of India(Registrars to an Issue and Share Transfer Agents)Regulations 1993 regarding the Companies Act anddealing with client
We have also examined compliance with the applicable clauses ofthe following(i) The mandatory Secretarial Standards issued by The Institute
of Company Secretaries of India with respect to BoardMeetings and General Meetings
(ii) The SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015
The Company has entered into an Operating Licence Agreementwith ITC Limited which operates the Hotel ndash WelcomHotel Vadodraand ensure compliance of all laws as applicable for running andmaintenance of the HotelDuring the period under review the Company has complied withthe provisions of the Act Rules Regulations Guidelines andStandards etc as mentioned above however in the CorporateGovernance Report filed pursuant to Regulation 27(2) of SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015with BSE for the quarter ended September and December 2018there is mismatch of date of the meetingWe further report thatThe Board of Directors of the Company is duly constituted withproper balance of Non-Executive Directors and IndependentDirectors The changes in the composition of the Board of Directorsthat took place during the period under review were carried out incompliance with provisions of the ActAdequate notice is given to all Directors for the Board Meetingsand Committees Meetings agenda and detailed notes on agendawere sent at least seven days in advance and where the meetingwas held in shorter notice due compliance was made and a systemexists for seeking and obtaining further information and clarificationson the agenda items before the meeting for meaningful participationat the meetingAll decisions at Board Meetings and Committee Meetings werecarried out unanimously as recorded in the minutes of the meetingsof the Board of Directors or Committees of the Board as the casemay beWe report that there are adequate systems and processes in theCompany commensurate with the size and operations of theCompany to monitor and ensure compliance with the applicableLaws Rules Regulations and GuidelinesWe further report that during the Audit Period the Company has nospecific events actions that have a major bearing on the Companyrsquosaffairs in pursuance of the above referred Laws RulesRegulations Guidelines Standards etc
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
Note This report is to be read with our letter of even date whichis annexed as Annexure A and forms an integral part of thisreport
27
FORM NO AOC-2[Pursuant to Section 134(3)(h) of the Companies Act 2013 and Rule 8(2) of the Companies (Accounts) Rules 2014]
Form for disclosure of particulars of contracts arrangements entered into by the Company with related parties referred to insub-section (1) of Section 188 of the Companies Act 2013 including certain arms length transactions under fourth proviso thereto
1 Details of contracts or arrangements or transactions not at arms length basis
a) Name(s) of the related party and nature of relationshipb) Nature of contracts arrangements transactionsc) Duration of the contracts arrangements transactionsd) Salient terms of the contracts or arrangements or transactions including the value if anye) Justification for entering into such contracts or arrangements or transactions NILf ) Date(s) of approval by the Boardg) Amount paid as advances if anyh) Date on which the special resolution was passed in general meeting as required under first proviso to Section 188
2 Details of material contracts or arrangement or transactions at arms length basis
a) Name(s) of the related party and nature of ITC Limited of which the Company is an Associaterelationship
b) Nature of contracts arrangements transactions Agreement for operating the Companyrsquos Hotel
c) Duration of the contracts arrangements Operating License Agreement (OLA) dated 24th September 1992 for an initialtransactions period of 30 years and renewable for another period of 30 years The OLA
emanated from the rehabilitation package agreed amongst Gujarat State GovtFinancial Institutions viz IFCI amp SBI and ITC in the year 1990
d) Salient terms of the contracts or arrangements The Company receives Licence fees 15 of Net Operating Income Valueor transactions including the value if any of transaction during the year ` 370 crores
e) Date(s) of approval by the Board if any 24th September 1992f ) Amount paid as advances if any Nil
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Annexure AToThe MembersGujarat Hotels Limited
Our report of even date is to be read along with this letter
1 Maintenance of secretarial record is the responsibilityof the management of the Company Our responsibilityis to express an opinion on these secretarial recordsbased on our audit
2 We have followed the audit practices and processesas were appropriate to obtain reasonable assuranceabout the correctness of the contents of the secretarialrecords The verification was done on the randomtest basis to ensure that correct facts are reflected insecretarial records We believe that the processesand practices we followed provide a reasonablebasis for our opinion
3 W e have not verified the correctness andappropriateness of financial records and books ofaccounts of the Company
4 W herever required we have obtained theManagement Representation about the complianceof Laws Rules and Regulations and happening ofevents etc
5 The compliance of the provisions of corporate andother applicable Laws Rules RegulationsStandards is the responsibility of management Ourexamination was limited to the verification ofprocedures on the random test basis
6 The Secretarial Audit Report is neither an assuranceas to the future viability of the Company nor of theefficacy or effectiveness with which the managementhas conducted the affairs of the Company
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
28
INDEPENDENT AUDITORSrsquo CERTIFICATE ON CORPORATE GOVERNANCE
INDEPENDENT AUDITORrsquoS CERTIFICATE ON CORPORATEGOVERNANCE
TO THE MEMBERS OF GUJARAT HOTELS LIMITED
1 We have examined the compliance of conditions ofCorporate Governance by Gujarat Hotels Limited (ldquotheCompanyrdquo) for the year ended on 31st March 2019as stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the Securities and Exchange Board ofIndia (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended(ldquoSEBI Listing Regulationsrdquo)
Managementrsquos Responsibility
2 The compliance of conditions of CorporateGovernance is the responsibility of the ManagementThis responsibility includes the designimplementation and maintenance of internal controland procedures to ensure the compliance with theconditions of the Corporate Governance stipulated inSEBI Listing Regulations
Auditorrsquos Responsibility
3 Our responsibility is limited to examining theprocedures and implementation thereof adopted bythe Company for ensuring the compliance of theconditions of the Corporate Governance It is neitheran audit nor an expression of opinion on the financialstatements of the Company
4 We have examined the books of account and otherrelevant records and documents maintained by theCompany for the purpose of providing reasonableassurance on the compliance with CorporateGovernance requirements by the Company
5 We have carried out an examination of the relevantrecords of the Company in accordance with theGuidance Note on Certification of CorporateGovernance issued by the Institute of CharteredAccountants of India (ldquothe ICAIrdquo) the Standards onAuditing specified under Section 143(10) of theCompanies Act 2013 in so far as applicable for the
purpose of this certificate and as per the GuidanceNote on Reports or Certificates for Special Purposesissued by the ICAI which requires that we comply withthe ethical requirements of the Code of Ethics issuedby the ICAI
6 W e have complied with the relevant applicablerequirements of the Standard on Quality Control (SQC)1 Quality Control for Firms that Perform Audits andReviews of Historical Financial Information and otherAssurance and Related Services Engagements
Opinion
7 Based on our examination of the relevant recordsand according to the information and explanationsprovided to us and representations provided by theManagement we certify that the Company hascomplied with the conditions of Corporate Governanceas stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the SEBI Listing Regulations asapplicable for the year ended 31st March 2019
8 W e state that such compliance is neither anassurance as to the future viability of the Companynor the efficiency or effectiveness with which theManagement has conducted the affairs of theCompany
Restrictions on Use
9 This Certificate is issued solely for the purpose ofcomplying with the aforesaid SEBI ListingRegulations and may not be suitable for any otherpurpose
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
29
ANNEXURE
FORM NO MGT-9EXTRACT OF ANNUAL RETURN
as on the Financial Year ended on 31st March 2019[Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the
Companies (Management and Administration) Rules 2014]
I REGISTRATION AND OTHER DETAILS
i) CIN L55100GJ1982PLC005408ii) Registration Date 7th August 1982iii) Name of the Company Gujarat Hotels Limitediv) Category Sub-Category of the Company Public company - Limited by sharesv) Address of the Registered office and contact details WelcomHotel Vadodara
R C Dutt Road AlkapuriVadodara 390 007Tel No 0265-233 0033E-mail ghlinvestorsyahoocoin
vi) Whether Listed Company Yesvii) Name Address and Contact details of MCS Share Transfer Agent Limited
Registrar and Transfer Agent if any F - 65 Okhla Industrial Area Phase - INew Delhi - 110 020Tel Nos (011) 4140 6149-52 4160 9386
II PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY
III PARTICULARS OF HOLDING SUBSIDIARY AND ASSOCIATE COMPANIES NIL
Sl No
Name and Description of main products services NIC Code of the products services
to total turnover of the Company
1 Hotel Services 55101 100
30
IV SHAREHOLDING PATTERN (Equity Share Capital Break-up as percentage of Total Equity)(i) Category-wise Shareholding
Category of Shareholders No of Shares held at the beginningof the year
No of Shares held at the endof the year
Changeduring the
year
A Promoters(1) Indiana) Individual HUF 0 0 0 0 0 0 0 0 0b) Central Govt 0 0 0 0 0 0 0 0 0c) State Govt(s) 0 0 0 0 0 0 0 0 0d) Bodies Corp 2033963 0 2033963 5370 2033963 0 2033963 5370 0e) Banks FI 0 0 0 0 0 0 0 0 0f ) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(1) 2033963 0 2033963 5370 2033963 0 2033963 5370 0(2) Foreigna) NRIs - Individuals 0 0 0 0 0 0 0 0 0b) Other - Individuals 0 0 0 0 0 0 0 0 0c) Bodies Corp 0 0 0 0 0 0 0 0 0d) Banks FI 0 0 0 0 0 0 0 0 0e) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(2) 0 0 0 0 0 0 0 0 0Total Shareholding of Promoter(A) = (A)(1)+(A)(2) 2033963 0 2033963 5370 2033963 0 2033963 5370 0B Public Shareholding1 Institutionsa) Mutual Funds 0 0 0 0 0 0 0 0 0b) Banks FI 0 100 100 0 100 100 c) Central Govt 0 0 0 0 0 0 0 0 0d) State Govt(s) 0 0 0 0 0 0 0 0 0e) Venture Capital Funds 0 0 0 0 0 0 0 0 0f ) Insurance Companies 0 0 0 0 0 0 0 0 0g) FIIs 10 0 10 0 0 0 h) Foreign Venture Capital Funds 0 0 0 0 0 0 0 0 0i) Others (specify) 0 0 0 0 0 0 0 0 0Sub-total (B)(1) 10 100 110 0 100 100 2 Non-Institutionsa) Bodies Corpi) Indian 300003 2200 302203 798 191626 2100 193726 511 (287)ii) Overseas 0 0 0 0 0 0 0 0 0b) Individualsi) Individual shareholders holding
nominal share capital upto` 1 lakh 774322 231562 1005884 2656 797094 203602 1000696 2643 (013)
ii) Individual shareholders holdingnominal share capital inexcess of ` 1 lakh 220814 0 220814 583 334765 0 334765 884 301
c) Others (specify)i) Non Resident Individuals 44288 71500 115788 306 45662 56700 102362 270 (036)ii) Investor Education and
Protection Fund AuthorityMinistry of Corporate Affairs 108753 0 108753 287 121903 0 121903 322 035
Sub-total (B)(2) 1448180 305262 1753442 4630 1491050 262402 1753452 4630 0Total Public Shareholding(B)=(B)(1)+ (B)(2) 1448190 305362 1753552 4630 1491050 262502 1753552 4630 0C Shares held by Custodian
for GDRs amp ADRs 0 0 0 0 0 0 0 0 0Grand Total (A+B+C) 3482153 305362 3787515 100 3525013 262502 3787515 100 0
Demat Physical Total of TotalShares
Demat Physical Total of TotalShares
ANNEXURE
31
1 Savi Portfolio Management Services LimitedAt the beginning of the year 122218 323Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 122218 323
2 Muktilal Ganulal PaldiwalAt the beginning of the year 82742 218Increase Decrease in Shareholding during the year06042018 220 001 82962 21913042018 250 001 83212 22001062018 927 002 84139 22215062018 700 002 84839 22427072018 412 001 85251 22505102018 1000 003 86251 22830112018 500 001 86751 22931122018 958 003 87709 23218012019 124 000 87833 23208022019 1070 003 88903 23501032019 467 001 89370 23615032019 1000 003 90370 23922032019 200 001 90570 24031032019 50 000 90620 240At the end of the year 90620 240
3 Taradevi Muktilal PaldiwalAt the beginning of the year 31628 084
(ii) Shareholding of Promoters (including Promoter Group)
(iii) Change in Promotersrsquo Shareholding (please specify if there is no change)
SlNo
Shareholders NameNo of
Shares of total
Sharesof the
Company
of Sharespledged
encumbered tototal Shares
No ofShares
of totalShares
of theCompany
of Sharespledged
encumbered tototal Shares
change inShareholding
during the year
1 ITC Limited 1733907 4578 Nil 1733907 4578 Nil Nil
2 Russell Investments Limited 300056 792 Nil 300056 792 Nil Nil
Shareholding at the beginning of the year Shareholding at the end of the year
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
(iv) Shareholding Pattern of top ten Shareholders (other than Directors Promoters and Holders of GDRs and ADRs)
ANNEXURE
No of Shares
Sl No
Particulars Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares of total Shares of the Company
No of Shares of total Shares of the Company
At the beginning of the year
No Change during the year Increase Decrease in Promoters Shareholding during the year
At the end of the year
32
Increase Decrease in Shareholding during the year06042018 180 000 31808 08413042018 53 000 31861 08420042018 1449 004 33310 08827042018 1933 005 35243 09304052018 1060 003 36303 09611052018 2196 006 38499 10218052018 1343 004 39842 10625052018 1191 003 41033 10906072018 1600 004 42633 11313072018 1678 004 44311 11720072018 2095 006 46406 12327072018 3735 010 50141 13303082018 415 001 50556 13410082018 685 002 51241 13624082018 1169 003 52410 13931082018 1616 004 54026 14307092018 1655 004 55681 14714092018 1311 003 56992 15021092018 2480 007 59472 15729092018 2259 006 61731 16305102018 1534 004 63265 16712102018 976 003 64241 17019102018 64 000 64305 17026102018 600 002 64905 17202112018 605 002 65510 17409112018 4 000 65514 17416112018 143 000 65657 17430112018 2299 006 67956 18007122018 515 001 68471 18114122018 10 000 68481 18121122018 590 002 69071 18331122018 600 002 69671 18504012019 1000 003 70671 18825012019 21 000 70692 18801022019 701 002 71393 19008022019 388 001 71781 19115022019 714 002 72495 19301032019 700 002 73195 19515032019 34 000 73229 195At the end of the year 73299 195
4 Shah Viren ShantilalAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 14122018 26965 071
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
ANNEXURE
33
Increase Decrease in Shareholding during theyear ie wef 1412201811012019 28946 076 55911 14701022019 7194 019 63105 166At the end of the year 63105 166
5 Chirayush Pravin VakilAt the beginning of the year 27482 073Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 27482 073
6 Falguni Nilesh DedhiaAt the beginning of the year 18000 048Increase Decrease in Shareholding during the year27042018 5175 014 23175 062At the end of the year 23175 062
7 Classic Realties Private LimitedAt the beginning of the year 23061 061Increase Decrease in Shareholding during the year31082018 100 000 23161 061At the end of the year 23161 061
8 Dheeraj Kumar LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 20000 053
9 Karvy Stock Broking LimitedAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 30112018 23063 061Increase Decrease in Shareholding during theyear ie wef 3011201807122018 149 000 23212 06114122018 (8165) (022) 15047 03931122018 7128 019 22175 05804012019 3087 008 25262 06611012019 (23721) (063) 1541 00331032019 15274 040 16815 043At the end of the year 16815 043 Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company Includes shares acquired during the period when not part of the top ten Shareholders of the Company
10 Sonal LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year20042018 (1000) (003) 19000 050
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
34
311218 0 000 0 00011012019 0 000 0 00031032019 (5000) (013) 14000 037At the end of the year 14000 037 Ceased to be part of the top ten Shareholders of the Company Became a part of the top ten Shareholders of the Company
11 Rajasthan Global Securities Private LimitedAt the beginning of the year 98659 260Increase Decrease in Shareholding during the year20042018 (4756) (013) 93903 24727042018 (5596) (015) 88307 23206072018 (790) (002) 87517 23027072018 (8520) (022) 78997 20802112018 (10975) (029) 68022 17916112018 (4) 000 68018 17930112018 (6189) (016) 61829 16307122018 (170) 000 61659 16314122018 (18503) (049) 43156 11421122018 (417) (001) 42739 11331122018 (11108) (029) 31631 08404012019 (5000) (013) 26631 07111012019 (5000) (013) 21631 05825012019 (2800) (007) 18831 05101022019 0 000 0 000At the end of the year NA NA Ceased to be a part of the top ten Shareholders of the Company
12 Dinesh Mukilal PaldiwalAt the beginning of the year 10522 028Increase Decrease in Shareholding during the year03082018 112 000 10634 02810082018 424 001 11058 02907092018 500 001 11558 03021092018 85 000 11643 03005102018 1000 003 12643 03302112018 0 000 12643 03301022019 0 000 12643 03315022019 300 001 12943 03431032019 0 000 12943 034At the end of the year NA NA Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company
Note Increase decrease in shareholding as indicated above are based on downloads of beneficial ownership provided by the Depositories generally everyFriday
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
35
(v) Shareholding of Directors and Key Managerial Personnel
ANNEXURE
Ms D R Choudhury Messrs C K Koshy R C Mehta M Narayanan and J Singh Directors Messrs M Agarwal andD K Gulati Key Managerial Personnel did not hold any Shares of the Company either at the beginning or at the end of theyear or at any time during the year
Mr K Pahwa Chief Executive Officer also did not hold any Shares of the Company either at the time of his appointment or atthe end of the year or at any time during the year
V INDEBTEDNESSIndebtedness of the Company including interest outstanding accrued but not due for payment NIL
VI REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNELA Remuneration to Managing Director Wholetime Directors and or Manager NOT APPLICABLE
B Remuneration to the other Directors(Amount in `)
Ceased to be Non-Executive Independent Director with close of work on 31st March 2019
Sl No For each of the Director
Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares held singly
jointly
of total Shares of the
Company
No of Shares held singly
jointly
of total Shares of the
Company
1 N Anand (Chairman)
At the beginning of the year 200 0
Increase Decrease in Shareholding during the year
0 0 0 0
At the end of the year 200 0
Sl No Directors
Particulars of Remuneration
Total Amount Fee for attending Board Board
Committee Meetings
Commission Independent Directors
Meeting Fees 1 Independent Directors
C K Koshy 140000 0 10000 150000 R C Mehta 70000 0 0 70000 M Narayanan 140000 0 10000 150000
Total (B)(1) 350000 0 20000 370000 2 Other Non-Executive Directors
N Anand 0 0 0 0 D R Choudhury 0 0 0 0 J Singh 0 0 0 0
Total (B)(2) 0 0 0 0 Total (B) = (B)(1) + (B)(2) 370000 Total Managerial Remuneration (A+B) 370000
Overall ceiling as per the Act (Being 11 of the Net Profits of the Company as calculated under Section 198 of the Companies Act 2013)
3759620
36
C Remuneration to Key Managerial Personnel other than MD Manager WTD(Amount in `)
Mr K Pahwa was appointed as Chief Executive Officer wef 1st February 2019
VII PENALTIES PUNISHMENT COMPOUNDING OF OFFENCES
against the Company Directors and other Officers in Default under the Companies Act 2013 NONE
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Sl No
Particulars of Remuneration Key Managerial Personnel
Total Amount
K Pahwa Chief Executive
Officer
M Agarwal Chief Financial
Officer
D K Gulati Company Secretary
1 Gross Salary
(a) Salary as per provisions contained in Section 17(1) of the Income-tax Act 1961
377472 2883242 880140 4140854
(b) Value of perquisites under Section 17(2) of the Income-tax Act 1961
242908 136154 0 379062
(c) Profits in lieu of salary under Section 17(3) of the Income-tax Act 1961
0 0 0 0
2 Stock Option 0 0 0 0 3 Sweat Equity 0 0 0 0 4 Commission
- as of profit - others specify
0 0 0 0
5 Others please specify 0 0 0 0 Total Amount 620380 3019396 880140 4519916
37
Services reverted to ITC Limited effective 17th December 2018 Reflects revision in remuneration effective 1st October 2018
Notes1 The number of permanent employees as on 31st March 2019 was 1982 Compared to 2017-18 the figures for 2018-19 reflect that
i) Median remuneration of employees - Increased by 965ii) Average remuneration of employees excluding Key Managerial Personnel (KMP) - Increased by 1040 with
increase in number of employeesiii) Remuneration of KMP - Increased by 1321 due to revision in remuneration during the year
3 Remuneration of Directors KMP and other employees is in accordance with the Companys Remuneration Policy
A Information pursuant to Section 197 of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014
Name of Directors ampKey ManagerialPersonnel
Designation Ratio of Remuneration toMedian Remuneration of
all employees
Increase inRemuneration over
LY ()
ANNEXURE
N Anand Non-Executive Chairman - -
D R Choudhury Non-Executive Director - -
C K Koshy Independent Director 0731 7
R C Mehta Independent Director 0341 -
M Narayanan Independent Director 0731 7
J Singh Non-Executive Director - -
D Rana Chief Executive Officer 12681 (15)
K Pahwa Chief Executive Officer (wef 1st February 2019) 3111 -
M Agarwal Chief Financial Officer 15281 24
D K Gulati Company Secretary 4371 8
38
O
n de
puta
tion
from
ITC
Lim
ited
(ITC
)
Ser
vice
s re
verte
d to
ITC
effe
ctiv
e 17
th D
ecem
ber
2018
N
otes
a
Gro
ss r
emun
erat
ion
incl
udes
sal
ary
var
iabl
e pa
y C
ompa
nys
con
tribu
tion
to p
rovi
dent
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d a
llow
ance
s amp
oth
er b
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app
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pro
visi
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cash
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t w
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n an
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rall
Com
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bas
is
The
ter
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ning
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ash
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Dire
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rd
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ce
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ingh
Dat
e 1
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il 2
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Dire
ctor
Dire
ctor
Desig
natio
nGr
oss
Rem
uner
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n(`
)
Net
Rem
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n(`
)
Quali
ficat
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Date
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Em
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)Na
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Top
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term
s of r
emun
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A
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ITC
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r - Fi
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dra R
ana
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e Of
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ited
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l Man
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ak K
umar
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any
Secr
etary
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S
701
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ligar
e Sec
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s Lim
ited
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ompli
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ajan
31As
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t Man
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7366
8164
6118
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A P
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e Fer
n Hote
l(M
arke
ting)
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ager
Kuna
l Pah
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37Ch
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xecu
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4183
8535
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m
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Limite
dFr
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ffice A
ssist
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am K
ashir
am B
abar
52Se
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xecu
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4175
8231
7347
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m
2201
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tel K
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r Ex
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Weld
er
INFORMATION US 197 OF THE COMPANIES ACT 2013
39
CEO AND CFO COMPLIANCE CERTIFICATE
We Kunal Pahwa Chief Executive Officer and Mayur Agarwal Chief Financial Officer certify that
a) We have reviewed the financial statements including the cash flow statement for the year ended 31st March 2019 andto the best of our knowledge and belief
i) these statements do not contain any materially untrue statement or omit any material fact or contain statementsthat might be misleading
ii) these statements together present a true and fair view of the Companyrsquos affairs and are in compliance with IndianAccounting Standards applicable laws and regulations
b) To the best of our knowledge and belief no transactions entered into by the Company during the year ended31st March 2019 are fraudulent illegal or violative of the Companyrsquos code of conduct
c) We accept responsibility for establishing and maintaining internal controls for financial reporting and we have evaluatedthe effectiveness of the internal control systems of the Company pertaining to financial reporting Deficiencies in thedesign or operation of such internal controls if any of which we are aware have been disclosed to the auditors and theAudit Committee and steps have been taken to rectify these deficiencies
d) i) There has not been any significant change in internal control over financial reporting during the year underreference
ii) The changes in the Significant Accounting Policies arising from the adoption of the Indian Accounting Standardshave been discussed with the auditors and have been approved by the Audit Committee and
iii) We are not aware of any instance during the year of significant fraud with involvement therein of the managementor any employee having a significant role in the Companyrsquos internal control system over financial reporting
Place New Delhi Kunal Pahwa Mayur AgarwalDate 15th April 2019 Chief Executive Officer Chief Financial Officer
40
BALANCE SHEET
As at 31st March 2019Amount in `
Particulars Note As at As at31st March 2019 31st March 2018
ASSETSNon-Current Assetsa) Property Plant and Equipment 2 14695652 15623727b) Other Non-Current Assets 3 6672434 7609451Total Non-Current Assets 21368086 23233178Current Assetsa) Financial Assets
(i) Investments 4 280294894 208482957(ii) Trade Receivables 5 16310661 14154244(iii) Cash and Cash Equivalents 6 763039 900355(iv) Other Bank Balances 7 5489856 53182631(v) Other Financial Assets 8 4724316 6349124
b) Other Current Assets 3 437564 406324Total Current Assets 308020330 283475635Total Assets 329388416 306708813EQUITY AND LIABILITIESEquitya) Equity Share Capital 9 37875150 37875150b) Other Equity 268275037 243468594Total Equity 306150187 281343744LIABILITIESNon-Current Liabilitiesa) Provisions 10 1399224 1270990b) Deferred Tax Liabilities (Net) 11 10745247 11364002Total Non-Current Liabilities 12144471 12634992Current Liabilitiesa) Financial Liabilities
(i) Trade Payablesa) Total outstanding dues of micro enterprises and
small enterprises ndash ndashb) Total outstanding dues of creditors other than
micro enterprises and small enterprises 483074 395920(ii) Other Financial Liabilities 12 9272344 11118126
b) Other Current Liabilities 13 1264039 1172866c) Provisions 10 74301 43165Total Current Liabilities 11093758 12730077Total Equity And Liabilities 329388416 306708813
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
41
STATEMENT OF PROFIT AND LOSS
For the year ended 31st March 2019Amount in `
I Revenue From Operations 14 36986948 33098499
II Other Income 15 19625544 17119109
III Total Income (I+II) 56612492 50217608
IV EXPENSES
Employee Benefits Expense 16 1208580 1094609
Depreciation and Amortization Expense 473636 475984
Other Expenses 17 3107913 3334087
Total Expenses (IV) 4790129 4904680
V Profit Before Tax (III- IV) 51822363 45312928
VI Tax Expense
Current Tax 18 11653499 9272310
Deferred Tax 18 (618755) 2350502
VII Profit for the Year (V-VI) 40787619 33690116
VIII Other Comprehensive Income ndash ndash
IX Total Comprehensive Income for the Year (VII+VIII) 40787619 33690116
X Earnings per Equity Share (Face Value ` 10-each) 19
Basic (in `) 1077 890
Diluted (in `) 1077 890
For the Year For the YearParticulars Note ended ended
31st March 2019 31st March 2018
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
42
For the year ended 31st March 2019
STATEMENT OF CHANGES IN EQUITY
The Board of Directors of the Company recommended a dividend of ` 35 per share (for the year ended 31st March 2018 - dividend ` 350 pershare) be paid on fully paid equity shares This equity dividend is subject to approval by shareholders at the Annual General MeetingThe totalequity dividend to be paid ` 13256303 (for the year ended 31st March 2018 - dividend ` 13256303) Income tax on proposed dividend being` 2724873 (for the year ended 31st March 2018 - ` 2724873)
General Reserve This Reserve is created by an appropriation from one component of equity (generally retained earnings) to another notbeing an item of Other Comprehensive Income The same can be utilized by the Company in accordance with the provisions of the CompaniesAct 2013
Retained Earnings This Reserve represents the cumulative profits of the Company This Reserve can be utilized in accordance with theprovisions of the Companies Act 2013
The accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even dateOn behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
A Equity Share CapitalAmount in `
Balance as at the Changes in equity Balance at thebeginning of the share capital end of the
reporting year during the year reporting yearFor the year ended 31st March 2018 37875150 ndash 37875150For the year ended 31st March 2019 37875150 ndash 37875150
B Other EquityAmount in `
Reserves amp Surplus TotalGeneral Reserve Retained Earnings
Balance as at April 01 2017 30257504 195873461 226130965Total Comprehensive Income for the year ndash 33690116 33690116Dividend ndash 13256303 13256303Income Tax on Dividend Paid ndash 2698671 2698671Dividend Distribution Tax (earlier year) ndash 397513 397513Balance as at March 31 2018 30257504 213211090 243468594Balance as at April 01 2018 30257504 213211090 243468594Total Comprehensive Income for the year ndash 40787619 40787619Dividend ndash 13256303 13256303Income Tax on Dividend Paid 2724873 2724873Balance as at March 31 2019 30257504 238017533 268275037
43
CASH FLOW STATEMENT
For the year ended 31st March 2019
For the Year For the YearParticulars ended ended
31st March 2019 31st March 2018
NOTES1) The above Cash Flow Statement has been prepared under the ldquoIndirect Methodrdquo as set out in Ind AS 7Statement of Cash FlowsrdquoThe accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even date On behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
Amount in `
A Cash Flow from Operating ActivitiesPROFIT BEFORE TAX 51822363 45312928Adjustments for
Depreciation amp Amortisation expense 473636 475984Interest Income (1317822) (3453950)Dividend Income (159984) (178075)Loss on sale of property plant and equipment - Net 445778 (28273)Net gain(loss) on investments mandatorily measuredat fair value through profit or loss (18005340) (13358789)Other Non Operating Income ndash (86856)Other Non Operating Expense ndash 99378
OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 33258631 28782347Adjustments for
Trade Receivables Financial Assets and Other Assets (2815198) (90661)Trade Payables Other Liabilities and Provisions (1568800) 1700052
CASH GENERATED FROM OPERATIONS 28874633 30391738Income Tax Paid(Net) (10407981) (12740273)
NET CASH FROM OPERATING ACTIVITIES 18466652 17651465B Cash Flow from Investing Activities
Sale of Property Plant and Equipment 8661 58452Purchase of Current Investments (224340000) (186220000)SaleRedemption of Current Investments 170532754 183295529Dividend Income 159984 178075Interest Received 3262318 4031382
NET CASH FROM INVESTING ACTIVITIES (50376283) 1343438C Cash Flow from Financing Activities
Dividend Paid (13256303) (13256303)Income Tax on Dividend Paid (2724873) (2698671)
NET CASH FROM FINANCING ACTIVITIES (15981176) (15954974)NET INCREASE IN CASH AND CASH EQUIVALENTS (47890807) 3039929OPENING CASH AND CASH EQUIVALENTS 48653846 45613917CLOSING CASH AND CASH EQUIVALENTS 763039 48653846
CASH AND CASH EQUIVALENTS COMPRISE Cash cheques and current accounts 763039 900355Other Bank BalancesDeposits with original maturity more than 3 months having remainingmaturity less than 12 months from Balance Sheet date ndash 47753491
763039 48653846
44
1 SIGNIFICANT ACCOUNTING POLICIESStatement of ComplianceThese financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) notifiedunder section 133 of the Companies Act 2013 (the Act) read with Companies (Indian Accounting Standards)Rules 2015 (as amended) The financial statements have also been prepared in accordance with the relevantpresentation requirements of the Companies Act 2013
Basis of PreparationThe financial statements are prepared in accordance with the historical cost convention except for certain itemsthat are measured at fair values as explained in the accounting policies below The financial statements arepresented in Indian Rupees (INR) which is also the Companyrsquos functional currency
Fair Value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transactionbetween market participants at the measurement date regardless of whether that price is directly observable orestimated using another valuation technique In estimating the fair value of an asset or a liability the Companytakes into account the characteristics of the asset or liability if market participants would take those characteristicsinto account when pricing the asset or liability at the measurement date
The preparation of financial statements in conformity with Ind AS requires management to make judgementsestimates and assumptions that affect the application of the accounting policies and the reported amounts ofassets and liabilities the disclosure of contingent assets and liabilities at the date of the financial statementsand the reported amounts of revenues and expenses during the year Actual results could differ from those estimatesThe estimates and underlying assumptions are reviewed on an ongoing basis Revisions to accounting estimatesare recognised in the period in which the estimate is revised if the revision affects only that period they arerecognised in the period of the revision and future periods if the revision affects both current and future periods
All assets and liabilities have been classified as current or non-current as per the Companyrsquos normal operatingcycle and other criteria set out in the Schedule III to the Companies Act 2013 and Ind AS 1 ndash Presentation ofFinancial Statements based on the nature of business and the time between the acquisition of assets for processingand their realisation in cash and cash equivalents
Property Plant amp Equipment ndash Tangible AssetsProperty plant amp equipment are stated at cost of acquisition or construction less accumulated depreciation andimpairment if any For this purpose cost includes deemed cost which represents the carrying value of propertyplant and equipment recognised as at 1st April 2015 measured as per the previous GAAP
Cost is inclusive of inward freight duties and taxes and incidental expenses related to acquisition In respect ofmajor projects involving construction related pre-operational expenses form part of the value of assets capitalisedExpenses capitalised also include applicable borrowing costs for qualifying assets if any Subsequent costs areincluded in the assetrsquos carrying amount only when it meets the recognition criteria are met as per componentaccounting The carrying amount of a replaced part is derecognized All other repairs and maintenance are chargedto the statement of Profit amp Loss
An item of property plant and equipment is derecognized upon disposal or when no future economic benefits areexpected to arise from the continued use of asset Any gain or loss arising on the disposal or retirement of an itemof property plant and equipment is determined as the difference between the sales proceeds and the carryingamount of the asset and is recognised in Statement of Profit and Loss
Depreciation of these assets commences when the assets are ready for their intended use which is generally oncommissioning Items of Property Plant and Equipment are depreciated in a manner that depreciates the cost ofthe assets after commissioning (or other amount substituted for cost) less its residual value over their usefullives as specified in Schedule II of the Companies Act 2013 on a straight line basis
Property plant and equipmentrsquosrsquo residual values and useful lives are reviewed at each balance sheet date andchanges if any are treated as changes in accounting estimate
NOTES TO THE FINANCIAL STATEMENTS
45
NOTES TO THE FINANCIAL STATEMENTS
Useful lives of different class of PPE are as follows
Particulars Useful Life as per Schedule IIBuilding 60 Years
Plant and Equipment 15 Years
Furnitures and fixtures 8 years
Office equipment 5 Years
Impairment of AssetsImpairment loss is provided if any to the extent the carrying amount of assets or cash generating units exceedtheir recoverable amount
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amountmay not be recoverable
Recoverable amount is higher of an assetrsquos net selling price and its value in use Value in use is the present valueof estimated future cash flows expected to arise from the continuing use of an asset or cash generating unit andfrom its disposal at the end of its useful life
Impairment losses recognised in prior years are reversed when there is an indication that the impairment lossesrecognised no longer exist or have decreased Such reversals are recognised as an increase in carrying amountsof assets to the extent that it does not exceed the carrying amounts that would have been determined (net ofamortisation or depreciation) had no impairment loss been recognised in previous years
Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodiedin the asset are considered to modify the amortisation period or method as appropriate and are treated aschanges in accounting estimates
Financial instruments Financial Assets and Financial LiabilitiesFinancial assets and financial liabilities are recognized when the Company becomes a party to the contractualprovisions of the relevant instrument Transaction cost that are directly attributable to the acquisition or issue offinancial assets and financial liabilities (other than financial assets and financial liabilities measured at fair valuethrough profit or loss) are added to or deducted from the fair value on initial recognition of financial assets andfinancial liabilities Purchase or sale of financial assets that require delivery of assets within a time frame establishedby regulation or convention in the market place (regular way trades) are recognized on the trade date ie the datewhen the Company commits to purchase or sell the asset
Financial AssetsRecognition Financial assets includes Investments Trade receivable Advances Security Deposits Cash andcash equivalents Such Assets are initially recognized at transaction price when the company becomes party tocontractual obligations The transaction price includes transaction cost unless the assets is being fair valuedthrough the Statement of Profit and Loss
Classification Management determines the classification of an asset at initial recognition depending on thepurpose for which the assets were acquired The subsequent measurement of financial assets depends on suchclassification
Financial assets are classified as those measured at
(a) Amortised cost where the financial assets are held solely for collection of cash flows arising from payments ofprincipal and or interest
(b) Fair value through other comprehensive income (FVTOCI) where the financial assets are held not only forcollection of cash flows arising from payments of principal and interest but also from the sale of such assetsSuch assets are subsequently measured at fair value with unrealised gains and losses arising from changesin the fair value being recognised in other comprehensive income
46
NOTES TO THE FINANCIAL STATEMENTS
(c) Fair value through profit or loss (FVTPL) where the assets are managed in accordance with an approvedinvestment strategy that triggers purchase and sale decision based on fair value of such assets Such assetsare subsequently measured at fair value with unrealized gain and losses arising from changes in the fair valuebeing recognised in the Statement of Profit and Loss in the period in which they arise
Trade receivable Advances Security Deposits Cash and Cash equivalents etc are classified for measurementat amortised cost while Investment have been classified for measurement at Fair value through profit or loss(FVTPL)
Impairment The Company assesses at each reporting date whether a financial asset (or group of financialassets) such as investment trade receivable advances and security deposit held at amortised cost are tested forimpairment based on evidence or information that is available without undue cost or effort Expected credit lossesare assessed and loss allowances recognized if the credit quality of the financial asset has deteriorated significantlysince initial recognition
Reclassification When and only when the business model is changed the Company shall reclassify all affectedfinancial assets prospectively from the reclassification date as subsequently measured at amortised cost fairvalue through profit or loss without restating the previously recognized gains or losses and in terms of thereclassification principles laid down in the Ind AS relating to Financial Instruments
De-recognition Financial assets are derecognized when the rights to receive benefits have expired or beentransferred and the Company has transferred substantially all risks and rewards of ownership of such financialasset
Financial LiabilitiesTrade payables and other financial liabilities are initially recognized at the value of the respective contractualobligations They are subsequently measured at amortised cost
Financial liabilities are derecognized when the liability is extinguished that is when the contractual obligation isdischarged cancelled or expires
Offsetting Financial InstrumentsFinancial assets and liabilities are offset and the net amount is included in the Balance Sheet where there is alegally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis orrealise the asset and settle the liability simultaneously
Revenue1 Revenue is measured at the fair value of the consideration received or receivable for services rendered net of
discounts to customers and excludes taxes such as Goods and Services Tax Revenue from the sale ofservices is recognised when the Company performs its obligations to its customers and the amount of revenuecan be measured reliably and recovery of the consideration is probable Income from operating license fees arerecognized on accrual basis in accordance with Operating License agreement The timing of such revenuerecognition is in the periods in which such services are rendered
2 Interest Income is booked in the Statement of Profit and Loss using the effective interest method
3 Dividend Income is recognised in the Statement of Profit and Loss when the right to receive dividend is established
Employee BenefitsThe Company makes contributions to both defined benefit and defined contribution schemes
Contributions to Provident Fund are in the nature of defined contribution scheme and such paidpayable amountsare charged against revenue The contributions in respect of provident fund and family pension are statutorilydeposited with the Government
The Company also makes contribution to defined benefit gratuity plan The cost of providing benefits under thedefined benefit obligation is calculated by independent actuary using the projected unit credit method The Companyhas taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liability with respect to the
47
NOTES TO THE FINANCIAL STATEMENTS
employees and the premium paid to LIC is charged to Statement of Profit amp Loss The difference between theactuarial valuation of the gratuity with respect to employees at the year-end and the contribution paid to LIC isfurther adjusted in the books of accounts
Employees Benefit wrt Leave Encashment is considered as Employees Long Term Benefit for which the Companyrecords the liability based on actuarial valuation computed under projected unit credit method These benefits areunfunded
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee as per the Operating LicenseAgreement
Taxes on IncomeTaxes on income comprises of current tax and deferred tax Current tax in the Statement of Profit and Loss isprovided as the amount of tax payable in respect of taxable income for the period using tax rates and tax lawsenacted during the period together with any adjustment to tax payable in respect of previous years
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities andthe amounts used for taxation purposes (tax base) at the tax rates and tax laws enacted or substantively enactedby the end of the reporting period
Deferred tax assets are recognized for the future tax consequences to the extent it is probable that future taxableprofits will be available against which the deductible temporary differences can be utilized
Deferred tax assets and liabilities are offset when there is legally enforceable right to offset current tax assets andliabilities and when the deferred tax balances relate to the same taxation authority Current tax assets and taxliabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on netbasis or to realize the asset and settle the liability simultaneously
Dividend DistributionDividends paid (including income tax thereon) is recognised in the financial statements in the period in which inwhich the interim dividends are approved by the Board of Directors or in respect of the Companyrsquos final dividendfor the year when the same are approved by shareholders of the Company
Provisions and Contingent LiabilitiesProvisions are recognized when the Company has a present obligation (legal or constructive) as a result of a pastevent it is probable that an outflow of resources will be required to settle the obligation and the amount can bereliably estimated The amount so recognized is the best estimate of the consideration required to settle theobligation at the reporting date taking in to account the risks and uncertainties surrounding the obligation Adisclosure for a contingent liability is made when there is possible obligation or a present obligation that may butprobably will not require an outflow of resources Where there is possible obligation or a present obligation inrespect of which the likelihood of outflow of resources is remote no provision or disclosure is made
Use of Estimates and JudgementsThe key estimates and assumption used in the preparation of financial statements are set out below
Actuarial ValuationThe determination of Companyrsquos liability towards defined benefit obligation to employees is made through independentactuarial valuation including determination of amounts to be recognized in the Statement of Profit and Loss and inother comprehensive income Such valuation depend upon assumptions determined after taking into accountinflation seniority promotion and other relevant factors such as supply and demand factors in the employmentmarket Information about such valuation is provided in notes to the financial statements
ComparativesWhen required by Ind AS comparative figures have been adjusted to conform to changes in presentation for thecurrent financial year
48
2P
rope
rty
Pla
nt a
nd E
quip
men
tA
mou
nt i
n `
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
Gros
s Bl
ock
Depr
eciat
on
Amor
tisati
onNe
t Blo
ck
Parti
cula
rsWi
thdraw
alWi
thdraw
alWi
thdraw
alWi
thdraw
alAp
ril 1
and
Marc
h 31
an
dMa
rch
31
April
1Fo
r the
and
March
31
For t
hean
dMa
rch
31
Marc
h 31
Ma
rch
31
2017
Addi
tions
Adjus
tmen
t20
18Ad
ditio
nsAd
justm
ent
2019
2017
year
Adjus
tmen
t20
18ye
arAd
justm
ent
2019
2019
2018
Tang
ible
Ass
ets
Build
ing
161
88
565
-16
188
565
-2
668
831
592
168
29
561
564
759
84-1
432
140
473
636
290
5518
76
721
140
44
961
147
56
425
Plan
t and
Equ
ipmen
t7
637
0120
716
742
985
-2
047
935
381
92-
--
--
--
538
192
742
985
Furn
iture
and
Fixt
ures
1
278
845
584
122
300
-11
818
110
482
--
--
--
-1
104
821
223
00
Offic
e Eq
uipme
nt2
017
-2
017
--
201
7-
--
--
--
201
72
017
Tota
l1
708
216
7-
263
001
705
586
7-
483
494
165
72
373
956
156
475
984
-14
321
404
736
3629
055
187
672
11
469
565
21
562
372
7
Full
y de
prec
iated
ass
ets
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
49
NOTES TO THE FINANCIAL STATEMENTS
Amount in `Particulars As at 31st March 2019 As at 31st March 2018
Current Non-Current Current Non-Current3 OTHER ASSETS
Advances other than capital advancesSecurity Deposit- With Others 2328947 2328947- Statutory Authorities 200000Other Advances (prepaid expenses) 437564 ndash 406324 ndashAdvance Tax (Net of Provisions) 4143487 5280504TOTAL 437564 6672434 406324 7609451
4 Current investments (at fair value through profit or loss unless otherwise stated) Amount in `Sl Investments in Mutual Funds As at 31st March 2019 As at 31st March 2018No
Name of Plan Unquoted Unquoted1 DHFL Pramerica Ultra Short Term Fund Nil (2018 - 1040731248)
Units of ` 1000 each ndash 219455882 ICICI Prudential Banking amp PSU Debt Fund 1124750948 Units
(2018 - 1124750948) of ` 1000 each 23872614 224702743 ICICI Prudential Corporate Bond Fund 1241451718 Units
(2018 - 1241451718) of ` 1000 each 23712100 221226704 UTI Floating Rate Fund Short Term Fund 7749911 Units
(2018-7749911) of ` 100000 each 23474167 218899535 SBI Magnum Instacash Nil Units (2018-3177849) of ` 100000 each ndash 70220186 Aditya Birla Sun Life Floating Rate Fund-Long Term 274475933 Units
(2018-319824542) Units of ` 10000 each 63614941 686675207 Aditya Birla Sunlife Saving Fund 137924934 Units (2018-129174683)
Units of ` 10000 each 51171946 443649348 Kotak Savings Fund 1128273230 Units (2018-Nil) of ` 1000 each 33816154 ndash9 Reliance Liquid Fund 11416769 Units (2018- Nil) of ` 100000 each 51823115 ndash10 ICICI Prudential Liquid Fund 57413509 Units (2018- Nil) of ` 10000 each 8809857 ndash
Aggregate amount of unquoted Investments 280294894 208482957TOTAL 280294894 208482957
Amount in `As at As at
31st March 2019 31st March 20185 TRADE RECEIVABLES
Unsecured Considered Good 16310661 14154244TOTAL 16310661 14154244
6 CASH AND CASH EQUIVALENTS Balances with Banks
Current Accounts 760024 900355Cash on Hand 3015 ndashTOTAL 763039 900355 Cash and cash equivalents include cash on hand cheques drafts on hand cash at bank and deposits with banks with original maturityof 3 months or less
7 OTHER BANKS BALANCESEarmarked balances 5489856 5429140On Deposit Accounts ndash 47753491TOTAL 5489856 53182631
Represents deposits with original maturity of more than 3 months having remaining maturity of less than 12 months from the Balance Sheet date
50
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
8 OTHER FINANCIAL ASSETSInterest accrued on Deposits 158000 2210348Others - Unsecured considered good 4566316 4138776TOTAL 4724316 6349124
As at As at As at As at31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of ` (No of `
Shares) Shares)9 EQUITY SHARE CAPITAL
AuthorisedEquity Shares of ` 10- each 10000000 100000000 10000000 100000000Issued Subscribed and Paid upEquity Shares of ` 10- each fully paid 3787515 37875150 3787515 37875150
A) Reconciliation of the number of Equity Shares outstanding31st March 31st March
2019 2018As at the beginning of the year 3787515 3787515Add - Shares issued during the year ndash ndashLess -Shares bought back during the year ndash ndashAs at the end of the year 3787515 3787515
B) Shareholders holding more than 5 of the As at As at As at As atEquity Shares in the Company 31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of (No of
Shares) Shares)ITC Limited 1733907 4578 1733907 4578Russell Investments Limited 300056 792 300056 792
C) Rights Preferences and Restrictions attached to the Equity SharesThe Equity Shares of the Company having par value of ` 10 per share rank pari passu in all respects includingvoting rights and entitlement to dividend
D) There are no bonus issue or buy back of equity shares during the period of five years immediately preceding thereporting date
As at 31st March 2019 As at 31st March 2018Current Non-Current Current Non-Current
10 PROVISIONSProvision for Long Term Employee Benefits 74301 1399224 43165 1270990TOTAL 74301 1399224 43165 1270990
51
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
11 DEFERRED TAX LIABILITIES (NET)Deferred Tax Liabilities 10745247 11364002Total 10745247 11364002Movement in Deferred Tax LiabilitiesAssets Balances
For the year 2018-19 Balance as on Recognized in Balance as on1st April 2018 profit or loss 31st March 2019
Deferred Tax Liabilities in relation toOther timing differences
On Depreciation on PPE 4293876 (252926) 4040950On Gain on Investment at FVTPL 7070126 473819 7543945
Total Deferred Tax Liabilities 11364002 220893 11584895Deferred tax liabilities beforeMAT credit entitlement 11364002 220893 11584895Less MAT credit entitlement ndash 839648 839648Total Deferred Tax Liabilities (Net) 11364002 (618755) 10745247
For the year 2017-18 Balance as on Recognized in Balance as on1st April 2017 profit or loss 31st March 2018
Deferred Tax liabilitiesassets in relation toOther timing differences
On Depreciation on PPE 4383618 (89742) 4293876On Gain on Investment at FVTPL 4629882 2440244 7070126
Total Deferred Tax Liabilities (Net) 9013500 2350502 11364002
As at As at31st March 2019 31st March 2018
12 OTHER FINANCIAL LIABILITIES
Unpaid Dividend 5489856 5429140Employee Related 3782488 5688986TOTAL 9272344 11118126
13 OTHER CURRENT LIABILITIES
Statutory Liabilities 1264039 1172866TOTAL 1264039 1172866
52
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 201814 REVENUE FROM OPERATIONS
Operating License Fees 36986948 33098499TOTAL 36986948 33098499
15 OTHER INCOMEInterest Income- Deposit with Banks- Carried At Amortised Cost 1178600 3272160- Deposit Others 139222 181790Dividend Income on Investment measured at FVTPL 159984 178075Net Gain(Loss) on financial assets mandatorily measured at FVTPL 18005340 13358789Net Gain(Loss) on Disposal of Fixed Assets ndash 28273Other Non-Operating Income 142398 100022TOTAL 19625544 17119109
Includes 1120976- (2018 - 681882-) being net gain(loss) on sale of investments
16 EMPLOYEE BENEFITS EXPENSESalaries and Wages 42461991 38590070Contribution to Provident and Other Fund 4564892 3983444
47026883 42573514Less Recoveries madeReimbursements received (45818303) (41478905)TOTAL 1208580 1094609
17 OTHER EXPENSESAdvertising Sales Promotion 159768 158814Consultancy Professional fees 214842 253969Travelling amp Conveyance 810746 1096527Postage Telephone Stationery etc 366042 205049Miscellaneous Expenses 1556515 1619728TOTAL 3107913 3334087Miscellaneous expenses includes Auditors remuneration andexpenses Audit Fees 60000 60000Fees for other services 40000 ndash
18 INCOME TAX EXPENSESA Amount recognised in profit or loss
Current TaxIncome Tax for the Year 11504441 9481109Adjustments(Credits) related to previous year 149058 (208799)Total Current Tax 11653499 9272310Deferred TaxDeferred tax for the year 220893 2350502Mat Credit Entitlement (839648) ndashTotal Deferred Tax (618755) 2350502TOTAL 11034744 11622812
NOTES TO THE FINANCIAL STATEMENTSAmount in `
53
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 2018B Reconciliation of effective tax rate
Profit before tax 51822363 45312928Indian tax rate 2782 2755Income Tax expense calculated at 2782 (2018 2755) 14416981 12484845Effects ofndash Different tax rate on certain items (2922098) (756048)ndash Difference in taxable incomedeductible expense 9697 42609ndash Incomes that are not taxable in determining taxable profit (44508) (49064)Adjustments recognised in the current year in relation toCurrent tax of prior years (425328) (208799)Effect on deferred tax balances due to the change in income tax rate ndash 109269Income Tax recognised in profit or loss 11034744 11622812
The tax rate used for the year 2018-19 and 2017-18 reconciliations above is the corporate tax rate of 25 + surcharge 7 and education cess 4 (2017-18 3) payable on taxable profits under the Income Tax Act 1961
19 EARNINGS PER EQUITY SHAREProfit for the year 40787619 33690116Number of equity shares outstanding 3787515 3787515Basic and diluted earnings per share in (Face value ` 10- per share) 1077 890
20 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTSA The Company was allotted 8200 sq mtrs of land at Vadodara in 1984 and an additional land of 2548 sq mtrs
in 1988 at R C Dutt Road Alkapuri Vadodara through GIIC (Gujarat Industrial Investment Corporation) on sub-lease for a period 30 years on which the hotel Welcomhotel Vadodara was constructed Lease term of landadmeasuring 8200 Sq mtrs expired on 30092014 and of land admeasuring 2548 sq mtrs expired on 30112018
The High Court of Gujarat in pursuance of Writ petition filed by Company in April 2013 passed an Order onDecember 24 2014 restraining the State Government from disturbing the peaceful and actual possession ofthe Company over the hotel property in any manner The writ petition is pending for hearing
The Company have made necessary application to State Government for Conversion of land from Leasehold toFreehold or Extension of Lease which is in process
B There are no Micro Small and Medium Enterprises to whom the Company owes dues which are outstandingfor more than 45 days during the year and also as at 31st March 2019 This information as required to bedisclosed under the Micro Small and Medium Enterprises Development Act 2006 has been determined tothe extent such parties have been identified on the basis of information available with the Company
C The Company operates in one segment ie Hoteliering and within one geographical segment ie India
D Defined Benefit Plan
The Company has taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liabilitywith respect to the employees and the premium paid to LIC is charged to Statement of Profit amp Loss Thedifference between the actuarial valuation of the gratuity with respect to employees at the year-end and thecontribution paid to LIC is further adjusted in the books of accounts
The accounting charge for benefits under the defined benefit obligation is calculated by independent actuaryusing the projected unit credit method
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee (ITC Limited) as per theOperating License Agreement hence no effect on Statement of Profit amp Loss and Other Comprehensive
54
NOTES TO THE FINANCIAL STATEMENTS
Income
Risk ManagementThe defined Benefit Plan expose the company to risk of actuarial deficit arising out of investment risk interestrate risk and salary cost inflation riskInvestment Risks This may arise from volatility in asset values due to market fluctuations and impairment ofassets due to credit losses These Plans primarily invest in debt instruments such as Government securitiesand highly rated corporate bonds ndash the valuation of which is inversely proportional to the interest rate movementsInterest Rate Risk The present value of Defined Benefit Plans liability is determined using the discount ratebased on the market yields prevailing at the end of reporting period on Government bonds A decrease inyields will increase the fund liabilities and vice-versaSalary Cost Inflation Risk The present value of the Defined Benefit Plan liability is calculated with referenceto the future salaries of participants under the Plan Increase in salary due to adverse inflationary pressuresmight lead to higher liabilitiesThese Plans have a relatively balanced mix of investments in order to manage the above risks The investmentstrategy is designed based on the interest rate scenario liquidity needs of the Plans and pattern of investmentas prescribed under various statutes
(Amount in `) Particulars Gratuity 2018-19 2017-18
I Components of Defined Benefit Cost 31-03-2019 31-03-2018 Recognised in Profit or Loss a Current Service Cost 641829 519816 b Past Service Cost ndash
c Net Interest Cost (184109) (72060) Remeasurements a Effect of changes in demographic assumptions (2108) ndash b Effect of changes in financial assumptions ndash (546692) c Effect of experience adjustments (142950) (700483) d (Return) on plan assets (excluding interest income) 24103 110903 e Changes in asset ceiling (excluding interest income) ndash ndash f Total remeasurements included in OCI (169160) (1358078)
Total defined benefit cost recognized in PampL 288560 (910323)I I Net Assets (Liabilities) recognised in Balance Sheet 31-03-2019 31-03-2018
1 Defined Benefit Obligation at end of period 11112243 102978642 Fair value of plan assets at end of period 13058222 120087733 Net defined benefit liability (asset) (1945979) (1710909)
III Change in Defined Benefit Obligation 31-03-2019 31-03-20181 Defined benefit obligation at beginning of period 10297864 111006822 Current service cost 641829 5198163 Interest expenses 755904 7223694 Remeasurements gains (losses)
a Effect of changes in demographic assumptions (2108) ndashb Effect of changes in financial assumptions ndash (546692)c Effect of experience adjustments (142950) (700483)
5 Benefits Paid (438296) (797828)6 Present Value of DBO at end of the year 11112243 10297864
IV Change in Fair Value of Plan Assets 31-03-2019 31-03-20181 Fair value of plan assets at beginning of period 12008773 11529880
55
NOTES TO THE FINANCIAL STATEMENTS
2 Interest income 940012 7944303 Actual Company Contributions 523630 3713884 Benefits Paid (438296) (797828)5 Remeasurements Gains(Losses) on plan assets 24103 1109036 Fair Value of Plan Assets at end of period 13058222 12008773
V Significant Actuarial Assumptions 31-03-2019 31-03-20181 Discount rate () 750 7502 Salary increase rate 70 703 Attrition Rate 20 204 Retirement Age 58 585 Pre-retirement Mortality Indian Assured Indian Assured
Lives Mortality Lives Mortality(2012-14) Ultimate (2006-08) Ultimate
6 Disability Nil NilVI Sensitivity Analysis
The below sensitivity analysis are based on a change in an assumption while holding all other assumptionsconstant In practice this is unlikely to occur and changes in some of the assumptions may be correlatedWhen calculating the sensitivity of the defined benefit obligation to significant actuarial assumptionsthe same method (present value of the defined benefit obligation calculated with the projected unit creditmethod at the end of the reporting period) has been applied as when calculating the defined benefitliability recognised in the balance sheet The methods and types of assumptions used in preparing thesensitivity analysis did not change compared to the prior period
DBO as at DBO as at31-03-2019 31-03-2018
1 Discount rate +100 basis points 10484869 96707062 Discount rate -100 basis points 11804923 109908143 Salary Increase Rate +1 11746789 109364544 Salary Increase Rate -1 10525722 97077345 Attrition Rate +1 11127835 103179616 Attrition Rate -1 11095064 10276102
Maturity Analysis of the Benefit Payments 31-03-2019 31-03-2018 Year 1 804294 399061 Year 2 1117591 769443 Year 3 558914 1211853 Year 4 2204073 512504 Year 5 1303903 2056016 Next 5 years 4323660 4603103
E Amount towards Defined Contribution Plans have been recognized under Contribution to Provident and OtherFunds in Note 16 ` 4564892- (2018 - ` 3983444-)
F The financial statements were approved for issue by the Board of Directors on 15th April 2019G Company has adopted IND As 115 lsquoRevenue from Contracts with Customersrsquo wef 01st April 2018 on prospective
basis and there is no material impact on Financial StatementsH Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Second
Amendment Rules 2019 on 30th March 2019 notifying new Standard Ind AS 116 lsquoLeasesrsquo and otherconsequential amendment in existing Ind As This Ind AS is applicable for annual period beginning on or after01st April 2019 The company is in the process of analysing the impact of such amendment which are notexpected to be material
56
NOTES TO THE FINANCIAL STATEMENTS
21 Financial Instruments and Related DisclosuresI Capital Management
The Company does not have borrowing and aims at maintaining a strong capital base so as to maintain adequatesupply of funds towards future growth plans as a going concern
II Categories of Financial InstrumentsAmount in `
Particulars Note As at As at March 31 2019 March 31 2018
Carrying Fair Carrying FairValue Value Value Value
A Financial Assetsa) Measured at Amortised Cost
i) Cash and cash equivalents 6 763039 763039 900355 900355ii) Other bank balances 7 5489856 5489856 53182631 53182631iii) Trade Receivables 5 16310661 16310661 14154244 14154244iv) Other Financial Assets 8 4724316 4724316 6349124 6349124
Sub - total 27287872 27287872 74586354 74586354 b) Measured at Fair Value through Profit or Loss
i) Investment in mutual funds 4 280294894 280294894 208482957 208482957Sub - total 280294894 280294894 208482957 208482957
Total Financial Assets 307582766 307582766 283069311 283069311B Financial Liabilities
Measured at Amortised Costi) Trade Payables 483074 483074 395920 395920ii) Other Financial Liabilities 12 9272344 9272344 11118126 11118126Total Financial Liabilities 9755418 9755418 11514046 11514046
The carrying amounts of trade payables other financial liabilities cash and cash equivalents other bank balancestrade receivables and other financial assets are considered to be the same as their fair values due to their short termnatureFair value in Mutual fund has been considered as Level 1 as Hierarchy for the same are based on unadjusted pricesin active marketIII Financial Risk Management Objectives
The Company has a system-based approach to risk management anchored to policies and procedures andinternal financial controls aimed at ensuring early identification evaluation and management of key financialrisks (such as market risk credit risk and liquidity risk) that may arise as a consequence of its businessoperations as well as its investing activities Accordingly the Companyrsquos risk management framework has theobjective of ensuring that such risks are managed within acceptable and approved risk parameters in a disciplinedand consistent manner and in compliance with applicable regulation It also seeks to drive accountability in thisregardLiquidity RiskThe company has current assets aggregate to ` 308020330- (2018- ` 283475635) including CurrentInvestments Cash and cash equivalents and Other bank balances of ` 286547789- (2018- ` 262565943-)against an aggregate Current liability of ` 11093758- (2018- ` 12730077-) on the reporting dateFurther whilethe Companyrsquos total equity stands at ` 306150187- (2018- ` 281343744-) and it has no borrowings In suchcircumstances liquidity risk or the risk that the company may not be able to settle or meet its obligations as theybecome due does not existMarket RiskThe company invests in mutual fund schemes of leading fund houses Such investments are susceptible tomarket price risk that arise mainly from changes in interest rate which may impact the return and value of such
57
NOTES TO THE FINANCIAL STATEMENTS
investments However given the relatively short tenure of the underlying portfolio of the mutual fund schemes inwhich the company has invested such price risk is not significantCredit RiskCompanyrsquos deployment in financial instruments such as mutual funds and fixed deposit are made in high qualitypaperscounterparties The company has receivable balances with ITC Limited under the Operating ServiceAgreement which are generally short term in nature Accordingly the Company has concluded that no provisionfor expected credit loss is required
22 Related Party DisclosuresRelated Party Transactionsi) Name of related parties and nature of relationships
ITC Limited of which the Company is an Associateii) Key Management Personnel
Board of DirectorsN Anand Chairman amp Non-Executive DirectorJ Singh Non-Executive DirectorR C Mehta Non-Executive DirectorC K Koshy Non-Executive DirectorM Narayanan Non-Executive DirectorD R Choudhury Non-Executive Director
iii) Summary of transactions during the year Amount in `
Particulars ITC Limited Key ManagementPersonnel
2019 2018 2019 2018License Fees Received 43644599 38834172 ndash ndashPurchase of Services 364514 513635 ndash ndashRemuneration of Managers on Deputation Reimbursed 5916468 5236397 ndash ndashRecoveries of Contractual Remuneration(Including Mangers on Deputation) 53058539 51502148 ndash ndashExpenses Recovered 2168155 2400471 ndash ndashExpenses Reimbursed ndash 44604 ndash ndashDividend Payments 6068675 6068675 700 700Remuneration to Key Management Personnel- Directorrsquos Sitting Fees 370000 350000Balance amount recoverable 20865894 18292750 ndash ndashBalance amount payable ndash ndash ndash ndash
58
TO THE MEMBERS OFGUJARAT HOTELS LIMITED
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying financial statementsof Gujarat Hotels Limited (ldquothe Companyrdquo) which comprisethe Balance Sheet as at 31st March 2019 the Statement ofProfit and Loss including other comprehensive incomeStatement of Changes in Equity and Statement of CashFlows for the year then ended and notes to the financialstatements including a summary of significant accountingpolicies and other explanatory information (hereinafterreferred to as ldquothe financial statementsrdquo)
In our opinion and to the best of our information andaccording to the explanations given to us the aforesaidfinancial statements give the information required by theCompanies Act 2013 (ldquothe Actrdquo) in the manner so requiredand give a true and fair view in conformity with the IndianAccounting Standards specified under section 133 of theAct read with the Companies (Indian Accounting Standards)Rules 2015 as amended (lsquoInd ASrdquo) and other accountingprinciples generally accepted in India of the state of affairsof the Company as at 31 st March 2019 and totalcomprehensive income (comprising of profit and othercomprehensive income) changes in equity and its cashflows for the year ended on that date
Basis for Opinion
We conducted our audit of the financial statements inaccordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act Our responsibilities underthose Standards are further described in the AuditorrsquosResponsibilities for the Audit of the Financial Statementssection of our report We are independent of the Companyin accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financialstatements under the provisions of the Act and the Rulesmade thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements andthe Code of Ethics We believe that the audit evidence wehave obtained is sufficient and appropriate to provide abasis for our audit opinion
Key Audit Matters
Key audit matters are those matters that in our professionaljudgment were of most significance in our audit of thesefinancial statements of the current period These matterswere addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereonand we do not provide a separate opinion on these mattersWe have determined the matters described below to bethe key audit matters to be communicated in our report
INDEPENDENT AUDITORS REPORT
Information Other than the Financial Statements andAuditorrsquos Report Thereon
The Companyrsquos Board of Directors is responsible forpreparation of the other information The other informationcomprises the information included in the Boardrsquos Reportincluding Annexures to Boardrsquos Report ManagementDiscussion and Analysis Report on Corporate Governance
and Shareholderrsquos Information but does not include thefinancial statements and our auditorrsquos report thereon
Our opinion on the financial statements does not cover theother information and we do not express any form ofassurance conclusion thereon
In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing
Sr No
Key Audit Matter How our audit addressed the matter
1 Evaluation of uncertain legal position of leasehold land
(Refer note no 20A to the financial statements)
The lease period of land held by the Company has expired The Company has filed necessary writ petition with High Court of Gujarat in April 2013 which is still pending for adjudication The Company has also made necessary application to State Government for Conversion of land from Leasehold to Freehold or Extension of Lease which is in process This matter being sub-judice essentially involves significant judgement to determine the possible outcome and therefore we have considered it as a key audit matter
We performed the following substantive procedures
Obtained details of application made to State Government Obtained details of writ petition filed to the High Court of
Gujarat and order copy passed by the High Court of Gujarat restraining the State Government from disturbing the actual possession over the property
Obtained details of progress in the matter Discussed the case with the Companyrsquos legal advisor about
the possible outcomes Read the minutes of the board meetings
Based on the procedures described managementrsquos evaluation on the same is acceptable
59
so consider whether the other information is materiallyinconsistent with the financial statements or our knowledgeobtained in the audit or otherwise appears to be materiallymisstated
If based on the work we have performed we conclude thatthere is a material misstatement of this other informationwe are required to report that fact We have nothing to reportin this regard
Responsibilities of Management and Those Charged withGovernance for the Financial Statements
The Companyrsquos Board of Directors is responsible for thematters stated in section 134(5) of the Act with respect tothe preparation of these financial statements that give atrue and fair view of the financial position financialperformance including other comprehensive incomechanges in equity and cash flows of the Company inaccordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards(Ind AS) prescribed under section 133 of the Act
This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company andfor preventing and detecting frauds and other irregularitiesselection and application of appropriate accounting policies making judgments and estimates that are reasonableand prudent and design implementation andmaintenance of adequate internal financial controls thatwere operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to thepreparation and presentation of the financial statementsthat give a true and fair view and are free from materialmisstatement whether due to fraud or error
In preparing the financial statements management isresponsible for assessing the Companyrsquos ability tocontinue as a going concern disclosing as applicablematters related to going concern and using the goingconcern basis of accounting unless management eitherintends to liquidate the Company or to cease operationsor has no realistic alternative but to do so
The Board of Directors is also responsible for overseeingthe Companyrsquos financial reporting process
Auditorrsquos Responsibilities for the Audit of the FinancialStatements
Our objectives are to obtain reasonable assurance aboutwhether the financial statements as a whole are free frommaterial misstatement whether due to fraud or error andto issue an auditorrsquos report that includes our opinionReasonable assurance is a high level of assurance but isnot a guarantee that an audit conducted in accordance withSAs will always detect a material misstatement when itexists Misstatements can arise from fraud or error and areconsidered material if individually or in the aggregate they
could reasonably be expected to influence the economicdecisions of users taken on the basis of these financialstatements
As part of an audit in accordance with SAs we exerciseprofessional judgment and maintain professionalskepticism throughout the audit We also
bull Identify and assess the risks of materialmisstatement of the financial statements whetherdue to fraud or error design and perform auditprocedures responsive to those risks and obtain auditevidence that is sufficient and appropriate to providea basis for our opinion The risk of not detecting amaterial misstatement resulting from fraud is higherthan for one resulting from error as fraud may involvecollusion forgery intentional omissionsmisrepresentations or the override of internal control
bull Obtain an understanding of internal control relevantto the audit in order to design audit procedures thatare appropriate in the circumstances Under section143(3)(i) of the Act we are also responsible forexpressing our opinion on whether the Company hasadequate internal financial controls system in placeand the operating effectiveness of such controls
bull Evaluate the appropriateness of accounting policiesused and the reasonableness of accountingestimates and related disclosures made bymanagement
bull Conclude on the appropriateness of managementrsquosuse of the going concern basis of accounting andbased on the audit evidence obtained whether amaterial uncertainty exists related to events orconditions that may cast significant doubt on theCompanyrsquos ability to continue as a going concern Ifwe conclude that a material uncertainty exists we arerequired to draw attention in our auditorrsquos report tothe related disclosures in the financial statementsor if such disclosures are inadequate to modify ouropinion Our conclusions are based on the auditevidence obtained up to the date of our auditorrsquosreport However future events or conditions maycause the Company to cease to continue as a goingconcern
bull Evaluate the overall presentation structure andcontent of the financial statements including thedisclosures and whether the financial statementsrepresent the underlying transactions and events ina manner that achieves fair presentation
We communicate with those charged with governanceregarding among other matters the planned scope andtiming of the audit and significant audit findings includingany significant deficiencies in internal control that weidentify during our audit
INDEPENDENT AUDITORS REPORT
60
We also provide those charged with governance with astatement that we have complied with relevant ethicalrequirements regarding independence and tocommunicate with them all relationships and other mattersthat may reasonably be thought to bear on ourindependence and where applicable related safeguards
From the matters communicated with those charged withgovernance we determine those matters that were of mostsignificance in the audit of the financial statements of thecurrent year and are therefore the key audit matters Wedescribe these matters in our auditorrsquos report unless lawor regulation precludes public disclosure about the mattersor when in extremely rare circumstances we determinethat a matters should not be communicated in our reportbecause the adverse consequences of doing so wouldreasonably be expected to outweigh the public interestbenefits of such communication
Report on Other Legal and Regulatory Requirements
1 As required by the Companies (Auditorrsquos Report)Order 2016 (ldquothe Orderrdquo) issued by the CentralGovernment of India in terms of sub-section (11) ofsection 143 of the Act we give in ldquoAnnexure Ardquo astatement on the matters specified in paragraphs 3and 4 of the Order to the extent applicable
2 As required by Section 143(3) of the Act we reportthat
a we have sought and obtained all the information andexplanations which to the best of our knowledge andbelief were necessary for the purposes of our audit
b in our opinion proper books of account as requiredby law have been kept by the Company so far as itappears from our examination of those books
c the Balance Sheet the Statement of Profit and lossincluding other comprehensive income the Statementof Changes in Equity and the Statement of Cash Flowsdealt with by this Report are in agreement with thebooks of account
d in our opinion the aforesaid financial statementscomply with the Indian Accounting Standards (Ind AS)prescribed under Section 133 of the Act
e on the basis of the written representations receivedfrom the directors as on 31st March 2019 taken onrecord by the Board of Directors none of the directorsis disqualified as on 31st March 2019 from beingappointed as a director in terms of Section 164(2) ofthe Act
f with respect to the adequacy of the internal financialcontrols with reference to financial statements of theCompany and the operating effectiveness of suchcontrols refer to our separate report in ldquoAnnexure Brdquoand
g with respect to the other matters to be included in theAuditorrsquos Report in accordance with the requirementsof section 197(16) of the Act as amended theCompany has neither paid nor provided for anyremuneration to its directors during the year
h with respect to the other matters to be included in theAuditorrsquos Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules 2014 in ouropinion and to the best of our information andaccording to the explanations given to us
i the Company does not have any pendinglitigations which would impact its financialposition
ii the Company did not have any long-termcontracts including derivative contracts for whichthere were any material foreseeable losses
iii there has been no delay in transferringamounts required to be transferred to theInvestor Education and Protection Fund by theCompany
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
61
ANNEXURE A TO THE INDEPENDENT AUDITORrsquoS REPORT
The annexure referred to in our Independent AuditorrsquosReport to the members of Gujarat Hotels Limited (ldquotheCompanyrdquo) on the financial statements for the year ended31st March 2019 we report that
i (a) The Company has maintained proper recordsshowing full particulars including quantitativedetails and situation of fixed assets
(b) As explained to us the Company has a regularprogram of physical verification of fixed assetswhich in our opinion is reasonable The assetswhich were to be covered as per the saidprogram have been physically verified by themanagement during the year In our opinion andAccording to the information and explanationsgiven to us no material discrepancies werenoticed on such verification
(c) According to the information and explanationsgiven to us and on the basis of our examinationof the records of the Company the title deeds ofimmovable properties are held in the name ofthe Company with respect to land the Companyhas filed a writ petition with Gujarat High Courtseeking that the Gujarat State Government bedirected to take action on Companyrsquosapplication to have the leasehold land of theHotel Converted to freehold and transferred toCompany as per the existing government policyin this regard
ii The Company does not have any inventory andtherefore reporting under clause (ii) of the Order isnot applicable to the Company
iii The Company has not granted any loans secured orunsecured to Companies firms Limited LiabilityPartnerships or other parties covered in the registermaintained under section 189 of the Companies Act2013 and therefore reporting under clause (iii) of theOrder is not applicable to the Company
iv The Company has not given any loans guaranteesor security In respect of the Investments made in ouropinion and according to the information andexplanations given to us the Company has compliedwith the provisions of section 186 of the Act
v According to the information and explanations givento us the Company has not accepted any depositsduring the year from the public within the meaning ofprovisions of section 73 to 76 of the Companies Act2013 and the rules framed thereunder and thereforereporting under clause (v) of the Order is notapplicable to the Company
vi In our opinion and according to the information andexplanations given to us in view of Rule 3 of theCompanies (Cost Records and Audit) AmendmentsRules 2014 the maintenance of cost records undersub-section (1) of section 148 of the Companies Act2013 is not applicable to the Company and thereforereporting under clause (vi) of the Order is notapplicable to the Company
vii (a) According to the information and explanationsgiven to us the Company has been regular indepositing with appropriate authoritiesundisputed statutory dues including providentfund employeersquos state insurance income-taxvalue added tax goods and service tax cessand other statutory dues applicable to it Furtherno undisputed amounts payable in respect ofprovident fund employeersquos state insuranceincome tax value added tax goods and servicetax cess and any other statutory dues were inarrears as at 31st March 2019 for a period ofmore than six months from the date theybecome payable
(b) According to the information and explanationsgiven to us there are no dues of Income taxsales tax value added tax and goods andservice tax which have not been deposited onaccount of any dispute
viii The Company has not taken any loans or borrowingsfrom financial institutions banks and government orhas not issued any debentures and thereforereporting under clause (viii) of the Order is notapplicable to the Company
ix The Company has not raised moneys by way of initialpublic offer or further public offer (including debtinstrument) and term loans during the year andtherefore reporting under clause (ix) of the Order isnot applicable to the Company
x To the best of our knowledge and according toinformation and explanations given to us no materialfraud by the Company or on the Company by its officersor employees has been noticed or reported duringthe course of our audit
xi In our opinion and according to the information andexplanations given to us the Company has not paidor provided any managerial remuneration during theyear and therefore reporting under clause (xi) of theOrder is not applicable to the Company
xii The Company is not a Nidhi company and thereforereporting under clause (xii) of the Order is notapplicable to the Company
INDEPENDENT AUDITORS REPORT
62
xiii In our opinion and according to the information andexplanations given to us and based on ourexamination of the records of the Company alltransactions with the related parties are in compliancewith Section 177 and 188 of the Act where applicableand the details have been disclosed in the financialstatements as required by the applicable accountingstandards
xiv According to the information and explanations givento us the Company has not made any preferentialallotment or private placement of shares or fully orpartly convertible debentures during the year underreview and therefore reporting under clause (xiv) ofthe Order is not applicable to the Company
xv In our opinion and according to the information andexplanations given to us the Company has not
entered into any non-cash transactions with directorsor persons connected with directors and thereforereporting under clause (xv) of the Order is notapplicable to the Company
xvi The Company is not required to be registered undersection 45-IA of the Reserve Bank of India Act 1934
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
63
ANNEXURE ldquoBrdquo TO THE INDEPENDENT AUDITORSrsquo REPORT
(Referred to in paragraph 2(f) under lsquoReport on Other Legaland Regulatory Requirementsrsquo section of our report to theMembers of Gujarat Hotels Limited on the financialstatements of even date)
Report on the Internal Financial Controls with referenceto financial statements under Clause (i) of Sub-section 3of Section 143 of the Act
W e have audited the internal financial controls withreference to financial statements of Gujarat Hotels Limited(ldquothe Companyrdquo) as of 31st March 2019 in conjunction withour audit of the financial statements of the Company for theyear ended on that date
Managementrsquos Responsibility for Internal FinancialControls
The Companyrsquos management is responsible forestablishing and maintaining internal financial controlsbased on the internal control over financial reporting criteriaestablished by the Company considering the essentialcomponents of internal control stated in the Guidance Noteon Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountantsof India (ldquoICAIrdquo) These responsibilities include the designimplementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuringthe orderly and efficient conduct of its business includingadherence to companyrsquos policies the safeguarding of itsassets the prevention and detection of frauds and errorsthe accuracy and completeness of the accounting recordsand the timely preparation of reliable financial informationas required under the Act
Auditorsrsquo Responsibility
Our responsibility is to express an opinion on theCompanyrsquos internal financial controls with reference tofinancial statements based on our audit We conductedour audit in accordance with the Guidance Note on Audit ofInternal Financial Controls over Financial Reporting (theldquoGuidance noterdquo) and the Standards on Auditing issued byICAI and deemed to be prescribed under section 143(10)of the Companies Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the ICAIThose Standards and the Guidance Note require that wecomply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whetheradequate internal financial controls with reference tofinancial statements were established and maintained andif such controls operated effectively in all material respects
Our audit involves performing procedures to obtain auditevidence about the adequacy of the internal financialcontrols with reference to financial statements and their
operating effectiveness Our audit of internal financialcontrols with reference to financial statements includedobtaining an understanding of internal financial controlswith reference to financial statements assessing the riskthat a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal controlbased on the assessed risk The procedures selecteddepend on the auditorrsquos judgement including theassessment of the risks of material misstatement of thefinancial statements whether due to fraud or error
We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our auditopinion on the Companyrsquos internal financial controls withreference to financial statements
Meaning of Internal Financial Controls with reference tofinancial statements
A Companyrsquos internal financial controls with reference tofinancial statements is a process designed to providereasonable assurance regarding the reliability of financialreporting and the preparation of financial statements forexternal purposes in accordance with generally acceptedaccounting principles A Companyrsquos internal financialcontrols with reference to financial statements includesthose policies and procedures that (1) pertain to themaintenance of records that in reasonable detailaccurately and fairly reflect the transactions anddispositions of the assets of the Company (2) providereasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements inaccordance with generally accepted accounting principlesand that receipts and expenditures of the Company arebeing made only in accordance with authorisations ofmanagement and directors of the Company and (3) providereasonable assurance regarding prevention or timelydetection of unauthorised acquisition use or dispositionof the Companyrsquos assets that could have a material effecton the financial statements
Inherent Limitations of Internal Financial Controls withreference to financial statements
Because of the inherent limitations of internal financialcontrols with reference to financial statements includingthe possibility of collusion or improper managementoverride of controls material misstatements due to erroror fraud may occur and not be detected Also projections ofany evaluation of the internal financial controls withreference to financial statements to future periods aresubject to the risk that the internal financial control withreference to financial statements may become inadequatebecause of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate
INDEPENDENT AUDITORS REPORT
64
Opinion
In our opinion the Company has in all material respectsan adequate internal financial controls with reference tofinancial statements and such internal financial controlswith reference to financial statements were operatingeffectively as at 31st March 2019 based on the internalcontrol over financial reporting criteria established by theCompany considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal
INDEPENDENT AUDITORS REPORT
Financial Controls over Financial Reporting issued by theInstitute of Chartered Accountants of India
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
2
BOARD OF DIRECTORS amp COMMITTEES
Board Committees
Chairman and Non-Executive Director
Nakul Anand
Non-Executive Directors
Mohan Swarup Bhatnagar
Devkanya Roy Choudhury
Cheruvettolil Kochukoshy Koshy
Mahalinga Narayanan
Jagdish Singh
M Narayanan Chairman C K Koshy Chairman J Singh Chairman
C K Koshy Member N Anand Member D R Choudhury Member
J Singh Member M Narayanan Member C K Koshy Member
M Agarwal Invitee J Singh Member
K Pahwa Invitee
Representative of InviteeStatutory Auditors
Audit Committee Nominations andRemuneration Committee
StakeholdersRelationship Committee
Key Managerial Personnel
Board of Directors
Registered Office Statutory Auditors Registrar and Share Transfer AgentsWelcomHotel Vadodara K C Mehta amp Co MCS Share Transfer Agent LimitedR C Dutt Road Alkapuri Chartered Accountants F-651st FloorVadodara - 390 007 Vadodara Okhla Industrial Area Phase - 1Tel 0265-233 0033 New Delhi 110 020CIN L55100GJ1982PLC005408 Tel 011-4140 6149-52 4160 9386Website wwwgujarathotelsltdinE-mail ghlinvestorsyahoocoin
Chief Executive Officer - Kunal Pahwa Chief Financial Officer - Mayur Agarwal
3
NOTICE IS HEREBY GIVEN that the Thirty Seventh AnnualGeneral Meeting of the Members of Gujarat Hotels Limitedwill be held at the Registered Office of the Company atWelcomHotel Vadodara R C Dutt Road Alkapuri Vadodarandash 390 007 on Saturday the 7th day of September 2019 at1100 am for the transaction of the following businesses-
ORDINARY BUSINESS
1 To consider and adopt the Financial Statements of theCompany for the financial year ended 31st March2019 and the Reports of the Board of Directors andthe Auditors
2 To declare dividend for the financial year ended31st March 2019
3 To appoint a Director in place of Mr Jagdish Singh(DIN 00042258) who retires by rotation and beingeligible offers himself for re-election
4 To consider and if thought fit to pass the followingresolution as an Ordinary Resolution-
ldquoResolved that in accordance with the provisions ofSection 142 of the Companies Act 2013 payment ofremuneration of ` 60000- (Rupees Sixty Thousandonly) to Messrs K C Mehta amp Co CharteredAccountants (FRN 106237W) to conduct the audit forthe financial year 2019-20 plus goods and servicestax as applicable and reimbursement of out-of-pocketexpenses incurred be and is hereby approvedrdquo
SPECIAL BUSINESS
5 To consider and if thought fit to pass the followingresolution as an Ordinary Resolution-
ldquoResolved that in accordance with the provisions ofSection 149 read with Schedule IV of the CompaniesAct 2013 and Regulation 17 of the Securities andExchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 thisMeeting hereby approves the appointment ofMr Mohan Swarup Bhatnagar (DIN 00834857) as anIndependent Director of the Company for a period offive years with effect from 28th June 2019 or till suchearlier date as may be determined by any applicablestatutes rules regulations or guidelinesrdquo
6 To consider and if thought fit to pass the followingresolution as a Special Resolution-
ldquoResolved that in accordance with the provisions ofSection 149 read with Schedule IV of the Companies
GUJARAT HOTELS LIMITEDCIN L55100GJ1982PLC005408
Registered Office WelcomHotel Vadodara R C Dutt Road Alkapuri Vadodara-390 007Tel +91 0265 233 0033 E-mail ghlinvestorsyahoocoin Website wwwgujarathotelsltdin
NOTICE OF 37TH ANNUAL GENERAL MEETING
AGM NOTICE
Act 2013 and Regulation 17 of the Securities andExchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 thisMeeting hereby approves the re-appointment ofMr Cheruvettolil Kochukoshy Koshy (DIN 01478704)as an Independent Director of the Company for aperiod of five years with effect from 29th September2019 or till such earlier date as may be determinedby any applicable statutes rules regulations orguidelinesrdquo
7 To consider and if thought fit to pass the followingresolution as a Special Resolution-
ldquoResolved that in accordance with the provisions ofSection 149 read with Schedule IV of the CompaniesAct 2013 and Regulation 17 of the Securities andExchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 thisMeeting hereby approves the re-appointment ofMr Mahalinga Narayanan (DIN 00159288) as anIndependent Director of the Company for a period offive years with effect from 29th September 2019 or tillsuch earlier date as may be determined by anyapplicable statutes rules regulations or guidelinesrdquo
The Register of Members of the Company will remainclosed from Friday 30th August 2019 to Saturday7th September 2019 both days inclusive ShareTransfers received in order at the Companyrsquos Registrarand Share Transfer Agents Messrs MCS ShareTransfer Agent Limited F-65 1st Floor Okhla IndustrialArea Phase - I New Delhi - 110 020 by 530 pm onThursday 29th August 2019 will be processed forpayment of dividend if declared to the transferees orto their mandatees and the dividend if declared willbe paid on Friday 13th September 2019 to thoseMembers entitled thereto and whose names willappear in the Register of Members of the Companyon 7th September 2019 or to their mandatees subjecthowever to the provisions of Section 126 of theCompanies Act 2013 In respect of dematerialisedshares the dividend will be paid on the basis ofbeneficial ownership as on 29th August 2019 as perdetails to be furnished by National SecuritiesDepository Limited (NSDL) and Central DepositoryServices (India) Limited (CDSL) for this purpose
By Order of the BoardGujarat Hotels Limited
Place New Delhi Jagdish SinghDate 15th July 2019 Director
4
NOTES
1 A Member entitled to attend and vote at the AnnualGeneral Meeting (lsquoAGMrsquo) may appoint a proxy toattend and vote on his behalf A proxy need not be aMember of the Company
Proxies in order to be effective must be received atthe Registered Office of the Company not less thanforty-eight hours before the commencement of the AGMie by 1100 am on 5th September 2019
Corporate Members are required to send to theRegistered Office of the Company a certified copy ofthe Board Resolution pursuant to Section 113 of theCompanies Act 2013 (lsquothe Actrsquo) authorising theirrepresentatives to attend and vote at the AGM
2 Explanatory Statement pursuant to Section 102 of theAct relating to the Special Business to be transactedat this AGM is annexed
3 Route map of the AGM venue pursuant to theSecretarial Standard on General Meetings is alsoannexed
4 In terms of Section 108 of the Act read with Rule 20 ofthe Companies (Management and Administration)Rules 2014 the Resolutions for consideration at thisAGM will be transacted through remote e-voting (facilityto cast vote from a place other than the venue of theAGM) for which purpose the Board of Directors of theCompany (lsquothe Boardrsquo) have engaged the services ofCDSL
The facility for voting through ballot paper will beavailable at the AGM venue for those Members who donot cast their votes by remote e-voting prior to the AGMMembers who cast their votes by remote e-voting mayattend the Meeting but will not be entitled to cast theirvotes once again The Board has appointedMr Suresh Kabra (ACS 9711) Partner Messrs SamdaniKabra amp Associates Company Secretaries as theScrutinizer to scrutinize the process of remote e-votingand voting through ballot paper at the AGM venue
5 Voting rights will be reckoned on the paid-up value ofshares registered in the name of the Members on31st August 2019 (cut-off date) Only those Memberswhose names are recorded in the Register ofMembers of the Company or in the Register ofBeneficial Owners maintained by the Depositories ason the cut-off date will be entitled to cast their votes byremote e-voting or voting through ballot paper at theAGM venue A person who is not a Member on thecut-off date should accordingly treat this Notice as forinformation purposes only
6 Unclaimed dividend for the financial year ended31st March 2012 and the corresponding Equity Sharesof the Company in respect of which dividend
entitlements remain unclaimed for seven consecutiveyears will be due for transfer to the Investor Educationand Protection Fund of the Central Government on14th September 2019 pursuant to the provisions ofSection 124 of the Act read with the Investor Educationand Protection Fund Authority (Accounting AuditTransfer and Refund) Rules 2016 Members arerequested to claim the said dividend details of whichare available on the Companyrsquos websitewwwgujarathotelsltdin under the section lsquoGeneralInformationrsquo under lsquoShareholder Valuersquo The Companywill not be able to entertain any claim received after12th September 2019 in respect of the same
7 Members may visit the Companyrsquos website to viewthe Financial Statements or access informationpertaining to the Company Queries if any should besent at least 10 days before the AGM to theChief Financial Officer at the Registered Office of theCompany
8 Members are required to bring their admission slipsto the AGM Duplicate admission slips or copies of theReport and Accounts will not be made available at theAGM venue
9 The procedure with respect to remote e-voting isprovided below
I The period for remote e-voting begins onTuesday 3rd September 2019 at 900 am andends on Friday 6th September 2019 at 500 pmDuring this period Members of the Companyholding shares either in certificate form or indematerialised form as on the cut-off date ie31st August 2019 may cast their voteselectronically The e-voting module shall bedisabled by CDSL for voting thereafter
II The Members should log on to the e-votingwebsite wwwevotingindiacom
III Click on lsquoShareholders MembersrsquoIV Now enter your user ID as under
bull For CDSL 16 digits beneficiary ID
bull For NSDL 8 character DP ID followed by 8digits Client ID
bull Members holding shares in certificate formshould enter Folio Number registered withthe Company
V Thereafter enter the image verification code asdisplayed and Click on lsquoLoginrsquo
VI If you are holding shares in dematerialised formand had logged on to wwwevotingindiacom andcasted your vote earlier for any company thenyour existing password is to be used If you have
5
forgotten the password then enter user ID andthe image verification code and click on forgotpassword amp enter the details as prompted by thesystem
VII If you are a first time user please follow the stepsgiven below
For Members holding shares either in dematerialisedform or in certificate form
PAN Enter your 10 digit alpha-numeric PAN issuedby Income Tax Departmentbull Members who have not updated their
PAN with the Company DepositoryParticipant are requested to use the firsttwo letters of their name and the 8 digitsof the sequence number in the PAN field
bull In case the sequence number is lessthan 8 digits enter the applicable numberof 0rsquos before the number after the firsttwo characters of the name in CAPITALletters Eg If your name is RameshKumar with sequence number I thenenter RA00000001 in the PAN field
Dividend Enter the Dividend Bank Details or Date ofBank Birth (in ddmmyyyy format) as recorded inDetails your demat account or in the CompanyOR records in order to loginDate of bull If both the details are not recorded withBirth the Depository or the Company please
enter your member ID folio number inthe Dividend Bank details field asmentioned in instruction IV
VIII After entering these details appropriately click onlsquoSubmitrsquo
IX Members holding shares in certificate form willthen reach directly to the Companyrsquos selectionscreen
X Members holding shares in dematerialised formwill then reach the lsquoPassword Creationrsquo menuwherein they are required to mandatorily entertheir login password in the new password fieldKindly note that this password can be used forvoting on resolutions of any other company onwhich you are eligible to vote provided that thesaid company opts for e-voting through CDSLplatform It is strongly recommended not to shareyour password with any other person and takeutmost care to keep your password confidential
XI For Members holding shares in certificate formthe details can be used only for e-voting on theResolutions contained in this Notice
XII Click on the EVSN for Gujarat Hotels Limited
XIII On the voting page you will see lsquoResolutionDescriptionrsquo and against the same the optionlsquoYes Norsquo for voting Select the option lsquoYesrsquo or lsquoNorsquoas desired The option lsquoYesrsquo implies that youassent to the Resolution and the option lsquoNorsquoimplies that you dissent to the Resolution
XIV Click on the lsquoResolutions File Linkrsquo if you wish toview the entire Resolution details
XV After selecting the Resolution you have decidedto vote on click on lsquoSubmitrsquo A confirmation boxwill be displayed If you wish to confirm your voteclick on lsquoOkrsquo else to change your vote click onlsquoCancelrsquo and accordingly modify your vote
XVI Once you lsquoConfirmrsquo your vote on the Resolutionyou will not be allowed to modify your vote
XVII You can also take a print of the votes cast byclicking on lsquoClick here to printrsquo option on theVoting page
XVIII Members can also cast their vote using CDSLrsquosmobile app lsquom-Votingrsquo available on Android Appleand Windows based mobiles Members may login to m-Voting using their e-voting credentials tovote on the Company Resolutions
XIX Note for NonndashIndividual Members and Custodians
bull Non-Individuals Members (ie other than HUFIndividuals NRI etc) and Custodians are requiredto log on to wwwevotingindiacom and registerthemselves as Corporates
bull A scanned copy of the Registration Form bearingthe stamp and sign of the entity should be emailedto helpdeskevotingcdslindiacom
bull After receiving the login details user would be ableto link the account(s) for which they wish to voteon
bull The list of accounts linked in the login should bemailed to helpdeskevotingcdslindiacom and onapproval of the accounts they would be able tocast their vote
bull A scanned copy of the Board Resolution and Powerof Attorney (POA) which they have issued in favourof the Custodian if any should be uploaded in PDFformat in the system for the Scrutinizer to verify thesame
XX In case you have any queries or issues regardinge-voting you may refer to the Frequently AskedQuestions and e-voting manual available underthe help section of CDSLrsquos e-voting websitewwwevotingindiacom or write an email tohelpdeskevotingcdslindiacom or contact
6
Mr Rakesh Dalvi at telephone no 18002005533(toll free) You may also address your queries grievances relating to remote e-voting or votingat the meeting to Mr M Agarwal ComplianceOfficer at e-mail ID ghlinvestorsyahoocoin orat telephone no 0265 233 0033
XXI Those who become Members of the Companyafter despatch of the Notice but on or before31st August 2019 (cut-off date) may follow thesteps from Sl Nos II to XIX mentioned above forcasting of vote
XXII General Information
(a) There will be one vote for every Client ID NoRegistered Folio No irrespective of thenumber of joint holders
(b) The Results of voting will be declaredwithin 48 hours from the conclusion of theAGM and the Resolutions will be deemedto be passed on the date of the AGMsubject to receipt of requisite number ofvotes The declared Results along with theScrutinizerrsquos Report will be availableforthwith on the Companyrsquos websitewwwgujarathotelsltdin under the sectionlsquoInvestor Relationsrsquo and on the website ofCDSL such Results will also be forwardedto BSE Limited where the Companyrsquosshares are listed
EXPLANATORY STATEMENT
Annexed to the Notice convening the Thirty Seventh AnnualGeneral Meeting to be held on Saturday 7th September2019
Item No 5
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 28th June 2019 on the recommendationof the Nominations and Remuneration Committee(lsquothe Committeersquo) approved the appointment of Mr MohanSwarup Bhatnagar as Additional Director with effect from28th June 2019 and subject to the approval of the Membersalso as Independent Director of the Company for a periodof five years with effect from the said date in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquotheActrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquothe Listing Regulations2015rsquo)
Mr Bhatnagar (67) is a Science Graduate from St StephenrsquosCollege University of Delhi and is an MBA from the Facultyof Management Studies University of Delhi
Mr Bhatnagar joined ITC Limited (ITC) in 1975 in the HotelsDivision He held various job positions in Finance beforetaking over as the Head of Finance in 1997 withresponsibility for Treasury Audit Purchasing MaterialManagement and Information Technology Subsequentlyhe held charge of Growth and Development for the HotelsBusiness as Executive Vice President He was a memberof the Management Committee of the Division and was onthe Boards of Joint Venture and Subsidiary companies ofITC He retired from ITC in September 2013 Currently heis actively involved in angel investing and in mentoringselect start-up ventures
The Committee and the Board are of the view that theassociation of Mr Bhatnagar and the rich experience hebrings with him would benefit the Company Declarationhas been received from Mr Bhatnagar that he meets thecriteria of Independence prescribed under Section 149 ofthe Act read with the Companies (Appointment andQualification of Directors) Rules 2014 and Regulation 16of the Listing Regulations 2015 In the opinion of your BoardMr Bhatnagar fulfils the conditions specified in the Act theRules thereunder and the Listing Regulations 2015 forappointment as an Independent Director and he isindependent of the management of the CompanyMr Bhatnagar will be entitled to sitting fees for attending themeetings of the Board and its Committees
Requisite Notice under Section 160 of the Act proposingthe appointment of Mr Bhatnagar has been received by theCompany and consent has been filled by Mr Bhatnagarpursuant to Section 152 of the Act
Mr Bhatnagar holds 2500 shares in the Company
Mr Bhatnagar and his relatives are interested in thisResolution None of the other Directors and Key ManagerialPersonnel of the Company or their relatives is interestedin this Resolution
The Board recommends this Resolution for your approval
Item Nos 6 amp 7
The Members of the Company at the Thirty Second AnnualGeneral Meeting held on 29th September 2014 approvedthe appointment of Mr Koshy and Mr M Narayanan asIndependent Directors of the Company for a period of fiveyears with effect from the said date Mr Koshy andMr Narayanan will complete their respective terms on28th September 2019
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 15th April 2019 on the recommendationof the Nominations and Remuneration Committee (lsquotheCommitteersquo) recommended for the approval of theMembers the re-appointment of Mr Koshy andMr Narayanan as Independent Directors of the Companywith effect from 29th September 2019 in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquothe
7
Actrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquoListing Regulations2015rsquo) as set out in the Resolutions relating to theirrespective re-appointment
The Committee and the Board are of the view that giventhe knowledge experience and performance of Mr Koshyand Mr Narayanan and contribution to the Board processesby them their continued association would benefit theCompany Declarations have been received from Mr Koshyand Mr Narayanan that they meet the criteria ofIndependence prescribed under Section 149 of the Act readwith the Companies (Appointment and Qualification ofDirectors) Rules 2014 and Regulation 16 of the ListingRegulations 2015 In the opinion of the Board Mr Koshyand Mr Narayanan fulfil the conditions specified in the Actthe Rules thereunder and the Listing Regulations 2015 forre-appointment as Independent Directors and they areindependent of the management of the Company Mr Koshyand Mr Narayanan will be entitled to sitting fees for attendingmeetings of the Board and its Committees
Consent of the Members by way of Special Resolution isrequired for re-appointment of Mr Koshy and Mr Narayananin terms of Section 149 of the Act Further pursuant toRegulation 17 of the Listing Regulations 2015 consent ofthe Members by way of Special Resolution is also requiredfor continuation of a Non-Executive Director beyond the ageof seventy five years During the proposed term ofre-appointment Mr Koshy and Mr Narayanan will attain theage of seventy five years on 12th February 2020 and1st July 2020 respectively The Special Resolutions under
Item No 6 and 7 once passed shall also be deemed asyour approval under the Listing Regulations 2015 forcontinuation of Mr Koshy and Mr Narayanan as IndependentDirectors beyond the age of seventy five years
Requisite Notices under Section 160 of the Act proposingthe re-appointment of Mr Koshy and Mr Narayanan havebeen received by the Company and consents have beenfiled by Mr Koshy and Mr Narayanan pursuant to Section152 of the Act
Additional information in respect of Mr Koshy andMr Narayanan pursuant to the Listing Regulations 2015and the Secretarial Standard on General Meetings isappearing in the Report and Accounts under the sectionslsquoYour Directorsrsquo and lsquoReport on Corporate GovernancersquoMr Koshy and Mr Narayanan do not hold any share in theCompany either in their individual capacity or on a beneficialbasis for any other person
Mr Koshy and Mr Narayanan and their relatives areinterested in the Special Resolutions relating to theirrespective re-appointment None of the other Directors andKey Managerial Personnel of the Company or theirrelatives is interested in these Special Resolutions
The Board recommends these Special Resolutions for yourapproval
By Order of the BoardGujarat Hotels Limited
Place New Delhi Jagdish SinghDate 15th July 2019 Director
8
ROUTE MAP
AGM VenueWelcomHotel VadodaraR C Dutt Road AlkapuriVadodara 390 007
9
N Anand
Nakul Anand (62) DIN 00022279 a Non-Executive Directorof the Company since 10th March 1998 was appointed asthe Chairman of the Company effective 21st March 2009He is an Executive Director on the Board of ITC Limited andholds responsibility for the Hospitality Travel amp Tourismand Lifestyle Retailing businesses of ITC
An Economics Honours Graduate from the Delhi Universitywith an AMP degree from the Bond University AustraliaAnand joined ITC Hotelsrsquo Management TrainingProgramme in 1978 He has also served as the ManagingDirector of erstwhile ITC Hotels Limited during the period2003-05
In a career that spans close to four decades Anand hasbeen acknowledged in the hotels and tourism industry forhis vision and commitment Leveraging the significantlearning of sustainable excellence within ITC he led theteam at ITC Hotels to pioneer the concept of lsquoResponsibleLuxuryrsquo in the hospitality industry securing LEEDreg Platinumcertifications for all ITC premium luxury hotels He hasformulated value-based strategies to create a uniquequality control model His dynamic leadership and passionfor the business is recognised and acknowledged by hispeers He has been a past President of the HotelAssociation of India and past Chairman of the CII NationalTourism Committee Anand is presently a member of theNational Tourism Advisory Council constituted by theMinistry of Tourism Government of India Chairman of theFederation of Associations in Indian Tourism amp Hospitalityand a Member of the Executive Committee of the HotelAssociation of India He is also a Member of the IndiandashSriLanka CEOs Forum Council Member amp ExecutiveCommittee Member of the National Culture Fund Ministryof Culture Government of India and a Member on the Boardof the International Tourism Partnership
Other Directorships
Name of the company Position
International Travel House Limited Chairman amp Non-Executive Director
Landbase India Limited Chairman amp Non-Executive Director
Fortune Park Hotels Limited Chairman amp Non-Executive Director
WelcomHotels Lanka (Private) Limited Chairman amp Non-Executive Director
Srinivasa Resorts Limited Vice Chairman amp Non-Executive Director
ITC Limited Executive Director
Bay Islands Hotels Limited Non-Executive Director
Maharaja Heritage Resorts Limited Non-Executive Director
Committee Membership of other companies
Name of the Committee Positioncompany
International Travel House Limited Nominations amp MemberRemuneration Committee
Landbase India Limited Audit Committee Member
Fortune Park Hotels Limited Corporate Social ChairmanResponsibility Committee
CK Koshy
Cheruvettolil Kochukoshy Koshy (74) DIN01478704 wasappointed as an Independent Non-Executive Director ofthe Company on 1st May 2007 He is Master of Arts inPolitical Science and Public Administration He joined theIndian Administrative Service in 1968 from the Gujarat Cadreand superannuated in February 2005
In a long career spanning over 38 years he has held severaleminent positions including those of Additional ChiefSecretary - Department of Revenue Industries and MinesTourism and Civil Aviation and Finance and PrincipalSecretary to the Chief Minister He served the Governmentof India as Joint Secretary amp Financial Advisor to theDepartment of Atomic Energy and as Executive Director ofNuclear Power Corporation of India Limited He has heldthe posts of Managing Director of the Tourism Corporationof Gujarat Sardar Sarovar Narmada Nigam Gujarat StateSmall Industries Corporation and Girinar Scooter LimitedHe was also the Joint Managing Director of the GujaratIndustrial Investment Corporation and Chairman of GujaratState Petroleum Corporation Limited Gujarat State PetronetLimited and Gujarat Energy Research and ManagementInstitute
Post retirement he has been a consultant to the Departmentfor International Development - UK the World Bank and tothe Department of Personnel and Administrative ReformsGovt of India He was appointed Professor Emeritus in thefaculty of Planning and Public Policy at CEPT UniversityAhmedabad and is an Advisor to both Indian School ofPetroleum and Energy New Delhi and University ofPetroleum and Energy Studies Dehradun Currently he isAdvisor at CEPT University and on the Board of Trustees ofAlliance Francaise Gujarat and GIAN an NGO whichencourages innovation at the grass root level
Koshy does not hold directorship of any other company
M Narayanan
Mahalinga Narayanan (74) DIN 00159288 was appointedas an Independent Non-Executive Director of the Companyon 10th January 2008 He is a post graduate in CommerceGraduate in Law Diploma Holder in Business Managementand holds certified Associated Membership of the Indian
YOUR DIRECTORS
10
Institute of Bankers He has rich experience of over fourdecades in Banking Project Finance Administration andrelated areas
Narayanan started his career with the Reserve Bank ofIndia in 1964 and moved over to the Bank of Baroda in1969 and continued till March 1985 During his tenure inBank of Baroda he worked in all departments of commercialbanking operation and was in-charge of large branches ofthe Bank In April 1985 he joined Industrial FinanceCorporation of India and held senior managementpositions In October 1997 he joined Tourism FinanceCorporation of India Limited as Managing Director and roseto the position of Chairman and Managing Director whichposition he held till his retirement in September 2006 Hewas conferred with ldquoUdyog Rattan Awardrdquo in the year 2005by the Institute of Economic Studies New Delhi
Other Directorships
Name of the company Position
Cox amp Kings Limited Independent DirectorTulip Star Hotels Limited Independent DirectorRoyale Indian Rail Tours Limited Independent DirectorPride Hotels Limited Chairman amp Independent Director
Committee Membership of other Companies
Name of the company Committee Position
Cox amp Kings Limited Audit Committee ChairmanRemuneration MemberCommittee
Pride Hotels Limited Audit Committee ChairmanRoyale Indian Rail Tours Limited Audit Committee Chairman
Tulip Star Hotels Limited Audit Committee Chairman
J Singh
Jagdish Singh (53) DIN 00042258 was appointed as aNon-Executive Director on the Board of the Company on16th April 2016 A Commerce Graduate and a CharteredAccountant Singh joined ITC Limited in the year 1990During these 26 years he has held various positions inthe finance function He started his career in Treasury andmoved as Corporate Accountant Commercial Manager atCigarette factory at Munger and Head of Finance at ITCEssentra Limited He was then the Head of Treasury
between 2005 and 2015 and is presently the Head ofFinance at ITCrsquos Hotels Division
Other DirectorshipsName of the company Position
International Travel House Limited Non-Executive DirectorFortune Park Hotels Limited Non-Executive DirectorBay Islands Hotels Limited Non-Executive DirectorSrinivasa Resorts Limited Non-Executive DirectorMaharaja Heritage Resorts Limited Non-Executive DirectorMimec (India) Limited Non-Executive DirectorLandbase India Limited Additional Non-Executive DirectorLogix Developers Private Limited Non-Executive Director
Committee Membership of other companiesName of the Committee Positioncompany
International Travel House Limited Stakeholders Relationship MemberCommitteeAudit Committee MemberNominations amp Remuneration MemberCommittee
Fortune Park Hotels Limited Corporate Social MemberResponsibility Committee
Srinivasa Resorts Limited Audit Committee ChairmanCorporate Social MemberResponsibility Committee
D R Choudhury
Devkanya Roy Choudhury (41) DIN 07066556 wasappointed as a Non-Executive Director of the Company on19th January 2015 A Graduate from the National LawSchool of India University Bengaluru she joined ITC Limitedin 2001 As part of Corporate Legal of ITC she has rich andvaried experience in handling legal matters pertaining tovarious divisions including Tobacco Hotels Personal CareLifestyle Retailing Education amp Stationery Paperboards ampSpecialty Papers ITC Infotech as also dealing with mergersamp acquisitions and key litigation across ITC CurrentlyMs Choudhury is the Senior Associate General Counsel ofITC Limited
Other Directorships
Name of the Company Position
WelcomHotels Lanka (Private) Limited Non-Executive Director
YOUR DIRECTORS
Denotes foreign company Denotes listed Indian company whose equity shares or preference shares or debt securities are listed on a recognised
stock exchangeNotes1 Other Directorships and Committee Memberships of Directors are as on 15th April 20192 Committee Memberships cover Committees under the Companies Act 2013 viz Audit Committee Stakeholders
Relationship Committee Nomination and Remuneration Committee and CSR Committee of Indian Companies
11
REPORT ON CORPORATE GOVERNANCE
The Directors present the Companyrsquos Report on CorporateGovernance pursuant to the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements)Regulations 2015 (lsquoListing Regulations 2015rsquo)
THE COMPANYrsquoS GOVERNANCE PHILOSOPHY
The Company firmly believes in good CorporateGovernance and has made it a practice and a continuousprocess of development right across the Company TheCompanyrsquos philosophy on Corporate Governanceenvisages attainment of high level of transparency andaccountability in the functioning of the Company andconduct of business and places due emphasis onregulatory compliance It has empowered the ExecutiveManagement to take decisions with regard to day-to-dayoperations and has also created checks and balances thatsuch decisions are taken with care and responsibility tomeet stakeholdersrsquo aspirations and societal expectations
The Companyrsquos corporate philosophy is focused on itspeople who are its most important asset and it values itsemployeesrsquo integrity creativity ability judgement andopinions who in turn demonstrate the highest ethicalstandards and responsibility towards the shareholdersThis has helped the Company take rapid strides in itspursuit of excellence
The Company is committed to enhance shareholder valuein a fair and transparent manner and has been in theforefront for benchmarking itself with the best businesspractices globally
BOARD OF DIRECTORS
All statutory and other significant and material informationare placed before the Board of Directors (the Board) toenable it to discharge its responsibility of strategicsupervision of the Company as trustees of theshareholders
Composition
The Board comprises entirely of Non-Executive Directorsincluding one Woman Director and two IndependentDirectors The strength of the Board as on 15th April 2019is five
The Board Diversity Policy of the Company requires theBoard to have balance of skills experience and diversity ofperspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the Annexure forming part ofthis Report These skills expertise and competencies areavailable in the present mix of the Directors of the Company
Composition of the Board as on 31st March 2019
Category No of PercentageDirectors to total no
of Directors
Non-Executive Independent Directors 3 50Other Non-Executive Directors 3 50Total 6 100
During the year there was no change in the directorshipMr R C Mehta resigned as Non-Executive IndependentDirector of the Company with close of work on 31st March2019 keeping in view the Regulation 17(1A) of ListingRegulations 2015
Mr Mehta has confirmed that there are no other reasons forhis resignation other than stated above
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Board were held The intervening periodbetween two Board meetings was well within the maximumgap of 120 days prescribed under the Listing Regulations2015
Board Agenda
Meetings are governed by a structured agenda The Boardmembers in consultation with the Chairman may bring upany matter for the consideration of the Board All majoragenda items are backed by comprehensive backgroundinformation to enable the Board to take informed decisionsAgenda papers are generally circulated seven days prior tothe Board meeting
Information placed before the Board
The following matters are tabled for the Boardrsquos periodicreview information
bull Annual operating plans amp budgets and periodic reviewof the Companyrsquos businesses
bull Quarterly performance
bull External Audit Management Reports (through the AuditCommittee)
bull Status of legal compliance
bull Status and effectiveness of risk management plans
bull Succession to senior management (through theNominations and Remuneration Committee)
bull Statutory compliance reports
bull Show cause demand prosecution adjudicationnotices if any from revenue authorities which areconsidered materially important including anyexposure that exceeds 1 of the Companyrsquos net worthand their outcome
12
bull W rite-offs disposals (fixed assets receivablesadvances etc) on a half-yearly basis
bull Significant development in Human Resources Industrial Relations
bull Material non-compliance of any regulatory or listingrequirements and in relation to shareholdersrsquoservices
bull All other matters required to be placed before theBoard for its review information under the ListingRegulations 2015 and other statutes
Post-meeting follow-up systemThe Governance processes in the Company include aneffective post-meeting follow-up review and reportingprocess for action taken pending on decisions of the Boardand the Board Committees
Details of Board Meeting during the financial year
During the financial year ended 31st March 2019 fourmeetings of the Board were held as follows
SI Date Board No ofNo Strength Directors
present
1 17th April 2018 6 6
2 7th August 2018 6 6
3 1st November 2018 6 5
4 30th January 2019 6 5
COMMITTEES OF THE BOARD
Currently there are three Committees of the Board ndash theAudit Committee the Stakeholders RelationshipCommittee and the Nominations and RemunerationCommittee The terms of reference of the BoardCommittees are determined by the Board from time to timeMeetings of Board Committees are convened by therespective Committee Chairman All the recommendationsmade by Board Committees during the year were acceptedby the Board Minutes of Board Committee meetings areplaced before the Board for its information The role andcomposition of these Committees including the numberof meetings held during the financial year and the relatedattendance are provided below
A AUDIT COMMITTEEThe Audit Committee of the Board provides reassurance tothe Board on the existence of an effective internal controlenvironment that ensuresbull efficiency and effectiveness of operations
bull safeguarding of assets and adequacy of provisionsfor all liabilities
bull reliability of financial and other managementinformation and adequacy of disclosures
bull compliance with all relevant statutesThe role of the Committee includes the followingbull To oversee the Companyrsquos financial reporting process
and the disclosure of its financial information to
REPORT ON CORPORATE GOVERNANCE
Directorsrsquo attendance at the Board Meetings during the financial year and at the last Annual General Meeting (AGM) as alsotheir other Directorships and Committee Memberships are given below
SI Director Category No of Attendance No of No of Membership(s) No Board at last other Chairmanship(s) of Audit
Meetings AGM Directorship(s) Committee Stakeholdersattended Relationship Committee of
other Indian public limitedcompanies
1 N Anand Chairman amp 4 Yes 8 1Non-Executive Director
2 C K Koshy Non-Executive 4 Yes Nil NilIndependent Director
3 R C Mehta1 Non-Executive 2 Yes 4 NilIndependent Director
4 M Narayanan Non-Executive 4 Yes 4 4 (all as Chairman)Independent Director
5 D R Choudhary Non-Executive Director 4 Yes 1 Nil6 J Singh Non-Executive Director 4 Yes 8 3 (including 1 as Chairman)
1 Resigned as Non-Executive Independent Director wef 1st April 2019 Details with respect to other Directorships of the Directors are provided under the section lsquoYour Directorsrsquo in the Report and Accounts
13
ensure that the financial statements are correctsufficient and credible
bull To recommend the appointment remuneration termsof appointment and removal of Statutory Auditors
bull To approve transactions of the Company with relatedparties
bull To evaluate the Companyrsquos internal financial controlsand risk management systems
bull To review with the management the following
- Annual financial statements and Auditorrsquos Reportthereon before submission to the Board forapproval
- Quarterly financial statements before submissionto the Board for approval
bull To review the following
- Management discussion and analysis of financialcondition amp results of operations and mattersrequired to be included in the DirectorsrsquoResponsibility Statement
- Adequacy of internal control systems and theCompanyrsquos statement on the same prior toendorsement by the Board such review to bedone in consultation with the managementStatutory and Internal Auditors
- Adequacy of internal control systems forcompliance with the provisions of the Securitiesand Exchange Board of India (Prohibition ofInsider Trading) Regulations 2015
- Reports of Internal Audit and discussion withInternal Auditors on any significant findings andfollow-up thereon
- Statutory Auditorsrsquo independence andperformance and effectiveness of the auditprocess
- System for storage retrieval security etc of booksof account maintained in the electronic form
- Functioning of Whistleblower mechanism in theCompany
Composition
The Audit Committee as on 15th April 2019 comprisesthree Non-Executive Directors two of whom are IndependentDirectors The Chairman of the Committee is anIndependent Director The Chief Executive Officer the ChiefFinancial Officer and the representative of Statutory Auditorsare Invitees to meetings of the Audit Committee and theCompany Secretary is the Secretary to the Committee Allmembers of the Committee are financially literate twomembers including the Chairman of the Committee haveaccounting and financial management expertise
The names of the members of the Audit Committeeincluding its Chairman are provided under the sectionlsquoBoard of Directors amp Committeesrsquo in the Report andAccounts
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Audit Committee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 4 4
2 7th August 2018 4 4
3 1st November 2018 4 3
4 30th January 2019 4 3
Attendance at Audit Committee Meetings during thefinancial year
Member No of meetingsattended
M Narayanan1 4
C K Koshy 4
R C Mehta2 2
J Singh 41 Appointed Chairman wef 15th April 20192 Ceased to be Member and Chairman wef 1st April 2019
B STAKEHOLDERS RELATIONSHIP COMMITTEE
The Stakeholders Relationship Committee of the Boardoversees redressal of shareholder and investor grievancesand inter alia approves transmission of sharessub-division consolidation renewal of share certificatesissue of duplicate share certificates etc
Composition
The Stakeholders Relationship Committee presentlycomprises three Non-Executive Directors including oneIndependent Director The Chairman of the Committee is aNon-Executive Director The Company Secretary is theSecretary to the Committee
The names of the members of the StakeholdersRelationship Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 sevenmeetings of the Stakeholders Relationship Committeewere held as follows
REPORT ON CORPORATE GOVERNANCE
14
SI Date Committee No ofNo Strength Members
present1 17th April 2018 2 2
2 29th June 2018 2 2
3 7th August 2018 2 2
4 27th September 2018 2 2
5 1st November 2018 2 2
6 4th January 2019 2 2
7 30th January 2019 2 2
Attendance at Stakeholders Relationship CommitteeMeetings during the financial year
Member No of meetingsattended
J Singh 7
D R Choudhury 7
C K Koshy 0
Appointed Member wef 31st March 2019
C NOMINATIONS AND REMUNERATION COMMITTEEThe Nominations and Remuneration Committee of theBoard inter alia identifies persons qualified to becomeDirectors and formulates criteria for evaluation ofperformance of the Directors and the Board as a wholeThe Committeersquos role includes recommending to theBoard the appointment remuneration and removal ofDirectors and Key Managerial Personnel
Composition
The Nominations and Remuneration Committee as on15th April 2019 comprises four Non-Executive Directorstwo of whom are Independent Directors The Chairman ofthe Committee is an Independent Director The CompanySecretary is the Secretary to the Committee
The names of the members of the Nominations andRemuneration Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 twomeetings of the Nominations and RemunerationCommittee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 5 5
2 30th January 2019 5 4
Attendance at Nominations and Remuneration CommitteeMeetings during the financial year
Member No of meetingsattended
C K Koshy 2
N Anand 2
R C Mehta1 1
M Narayanan 2
J Singh 21 Ceased to be Member wef 1st April 2019
Remuneration Policy
The Companyrsquos Remuneration Policy aims at attractingand retaining high calibre talent The Remuneration Policytherefore is market-led and takes into account thecompetitive circumstance of each business so as to attractand retain quality talent and leverage performancesignificantly
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpwwwgujarathotels ltd in polic ies Remuneration-Policy_GHLpdf There has been no change in the Policyduring the year
Remuneration of Directors
Non-Executive Directors are entitled to sitting fees forattending the meetings of the Board and its Committeesthe quantum of which is determined by the Board Thesitting fees to Non-Executive Directors as determined bythe Board are ` 20000- and ` 10000- for each meeting ofthe Board and its Committees respectively
Details of sitting fees paid to the Directors during thefinancial year ended 31st March 2019
Director Sitting Fees (`)
C K Koshy 150000-
R C Mehta1 70000-
M Narayanan 150000-1 Resigned as Non-Executive Independent Director wef1st April 2019
Note Disclosure with respect to Non-Executive Directors ndashPecuniary relationship or transaction None
Performance Evaluation
Performance evaluation of the Board the BoardCommittees and the individual Directors was carried outby the Board in accordance with the Policy approved by theNominations and Remuneration Committee in this regardbrief details of the same are provided in the lsquoReport of theBoard of Directors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
REPORT ON CORPORATE GOVERNANCE
15
Directorsrsquo Shareholding
Details of Shareholding of the Directors in the Company ason 31st March 2019 are given below
Director No of Equity Shares of ` 10-each held singly jointly
N Anand 200
D R Choudhury Nil
C K Koshy Nil
R C Mehta Nil
M Narayanan Nil
J Singh Nil
OTHER DISCLOSURESbull Details of non-compliances penalties and strictures
by Stock Exchanges SEBI Statutory Authorities onany matter related to capital markets during the lastthree years
Nonebull Inter-se relationships between Directors and Key
Managerial Personnel of the Company
Nonebull Materially significant related party transactions which
may have potential conflict with the interests of theCompany at large
Nonebull Material financial and commercial transactions of
senior management where they may have hadpersonal interest and which had potential conflict withthe interests of the Company at large
Nonebull Details of utilisation of funds raised through
preferential allotment or qualified institutionsplacement
Not Applicablebull Credit rating(s) obtained by the Company for any debt
instrument fixed deposit programme or any otherscheme involving mobilisation of funds
Nonebull None of the Directors of the Company has been
debarred or disqualified from being appointed orcontinuing as a Director by SEBI Ministry of CorporateAffairs Statutory Authorities which has also beenconfirmed by Messrs PB amp Associates PractisingCompany Secretaries
bull Confirmation by the Board with respect to theIndependent Directors is provided in the lsquoReport ofthe Board of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Disclosures in relation to the Sexual Harassment ofWomen at Workplace (Prevention Prohibition andRedressal) Act 2013 are provided in the lsquoReport of theBoard of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Information with respect to lsquoCommodity Price Risk orForeign Exchange Risk and Hedging Activitiesrsquo
Nonebull The total fees paid by the Company to Messrs K C
Mehta amp Co Statutory Auditors and all other entitiesforming part of the same network aggregate` 100000-
bull Compliance Officer under the Listing Regulations2015
Deepak Kumar Gulati Company Secretary
MEANS OF COMMUNICATION
Timely disclosure of consistent comparable relevant andreliable information on corporate financial performance isat the core of good governance Towards this end thequarterly results of the Company were announced withinforty five days from the end of the quarter Audited annualresults along with the results for the fourth quarter wereannounced within sixty days from the end of the financialyear Extract of these results were published in lsquoTheFinancial Expressrsquo (all editions) and in its Gujarati editionas vernacular newspaper Further quarterly resultsshareholding pattern and other material events amp importantinformation relating to the Company were submitted to BSELimited through BSE Listing Centre for dissemination onits website The Company publishes its quarterlyhalf-yearly and annual financial results and also posts suchresults on its website wwwgujarathotelsltdin
The Report of the Board of Directors forming part of theReport and Accounts includes all aspects of lsquoManagementDiscussion and Analysisrsquo as required under the ListingRegulations 2015
GHL CODE OF CONDUCT FOR PREVENTION OF INSIDERTRADING ndash 2019
The GHL Code of Conduct for Prevention of Insider Tradingapproved by the Board inter alia prohibits trading insecurities of the Company by Directors and employeeswhile in possession of unpublished price sensitiveinformation in relation to the Company
GHL CODE OF CONDUCT
The GHL Code of Conduct is applicable to Directors seniormanagement and employees of the Company The Codeis derived from three interlinked fundamental principlesviz good corporate governance good corporate citizenshipand exemplary personal conduct in relation to theCompanyrsquos business and reputation The Code coversGHLrsquos commitment to sustainable development concern
REPORT ON CORPORATE GOVERNANCE
16
for occupational health safety and environment a genderfriendly workplace transparency and auditability legalcompliance and the philosophy of leading by personalexample The Code is available on the Companyrsquos website
Declaration as required under the Listing Regulations 2015All Directors and senior management of the Companyhave affirmed compliance with the GHL Code of Conductfor the financial year ended 31st March 2019New Delhi K Pahwa15th April 2019 CEO
WHISTLEBLOWER POLICYSynopsis of the Whistleblower Policy of the Company isprovided in the lsquoReport of the Board of Directors ampManagement Discussion and Analysisrsquo forming part of theReport and Accounts The Whistleblower Policy is alsoavailable on the Companyrsquos websiteFAMILIARISATION PROGRAMME FOR DIRECTORSGHL believes that a Board which is well informed familiarised with the Company and its affairs can contributesignificantly to effectively discharge its role of trusteeshipin a manner that fulfils stakeholdersrsquo aspirations andsocietal expectations In pursuit of this the Directors of theCompany are updated on changes developments in thedomestic global corporate and industry scenario includingthose pertaining to statutes legislations and economicenvironment and on matters affecting the Company toenable them to take well informed and timely decisionsFurther details may be accessed on the Companyrsquos websiteat httpwwwgujarathotelsltdinpoliciesDirectorrsquos-Familiarisation-programmespdfPOLICY ON RELATED PARTY TRANSACTIONSThe Policy as approved by the Board may be accessed onthe Companyrsquos website at
h t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_TranscationspdfDISCRETIONARY REQUIREMENTS UNDER THE LISTINGREGULATIONS 2015The status of compliance with the discretionaryrequirements under the Listing Regulations 2015 isprovided below1 Chairmanrsquos Office The Company has a Non-Executive
Chairman but he does not maintain any separate officeand hence no expense in this regard is being incurredby the Company
2 Shareholder Rights The quarterly half-yearly andannual financial results of the Company are postedon the Companyrsquos website and extract of these resultsare published in newspapers on an all India basisThe complete Report and Accounts is sent to everyShareholder of the Company
3 Audit Opinion It has always been the Companyrsquosendevour to present financial statements with
unmodified audit opinion The Statutory Auditors haveissued an unmodified audit opinion on the Companyrsquosfinancial statements for the year ended 31st March2019
4 Separate posts of Chairman and Chief ExecutiveOfficer The Company has a Non-Executive Chairmanand a Chief Executive Officer
5 Internal Audit The Internal Auditor of the CompanyMessrs Shah amp Talati Chartered Accountants reportsto the Audit Committee of the Board
GENERAL SHAREHOLDER INFORMATIONProvided in the lsquoShareholder Informationrsquo section of theReport and Accounts
CONFIRMATION OF COMPLIANCEbull It is confirmed that the Company has complied with
the requirements prescribed under Regulations 17 to27 and clauses (b) to (i) of sub - regulation (2) ofRegulation 46 of the Listing Regulations 2015
bull The Statutory Auditorsrsquo Certificate that the Companyhas complied with the conditions of CorporateGovernance is annexed to the lsquoReport of the Board ofDirectors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
ANNEXURE TO THE REPORT ON CORPORATEGOVERNANCESKILLS EXPERTISE AND COMPETENCIES OF DIRECTORSThe Company believes that Board members should havea balance of skills experience and diversity of perspectivesappropriate to the Company Accordingly the Directorsshould possess one or more of the following skillsexpertise and competencies
1 Leadership
Leadership experience in a commensurate-sizedorganisation with understanding of organisationalsystems and processes strategic areas andemerging business trends
2 Industry Knowledge and Experience
Domain knowledge of Hotel business and itsdynamics long-term strategies and regulatory ampcompetitive environment
3 Finance and Accounting
Ability to understand financial policies accountingstatements and disclosure practices to contribute tothe financial risk management policies and practicesof the Company
4 Governance
Commitment belief and experience in settinggovernance practices to support the Companys legalcompliance systems and governance polic ies practices
REPORT ON CORPORATE GOVERNANCE
17
SHAREHOLDER INFORMATION
AGM Details
Date Saturday 7th September 2019Venue WelcomHotel Vadodara R C Dutt Road
Alkapuri Vadodara 390 007Time 1100 amBook Friday 30th August 2019 toClosure Saturday 7th September 2019Dates (both days inclusive)Dividend Friday 13th September 2019PaymentDate
Registrar and Share Transfer Agents
Messrs MCS Share Transfer Agent Limited are the Registrarand Share Transfer Agents (RTA) of the Company forcarrying out share registration and other related activitiesof the Company
Address for Correspondence
MCS Share Transfer Agent LimitedF-65 1st Floor Okhla Industrial AreaPhase ndash I New Delhi - 110 020Telephone Nos 011 4140 6149-52 4160 9386Facsimile No 011 4170 9881E-mail helpdeskdelhimcsregistrarscom
Shareholders holding shares in the dematerialised formshould address their correspondence except those relatedto dividend to their respective Depository Participants
Share Transfer Committee
The Share Transfer Committee of the Company generallymeets once in ten days for approving share transfers Theprocessing activities with respect to requests received forshare transfers are completed within fifteen days from thedate of receipt of request The Committee met 11 timesduring the financial year ended 31st March 2019 to approveshare transfers There were no share transfers pendingas on 31st March 2019
The Share Transfer Committee presently comprises thefollowing
D R Choudhury - Director MemberJ Singh - Director MemberM Agarwal - Compliance Officer Member
Dematerialisation of Shares and Liquidity
The shares of the Company are available for trading in thedematerialised form under both the Depository Systems inIndia - NSDL and CDSL The International SecuritiesIdentification Number (lSIN) allotted to the Companysshares under the Depository System is INE621C01011
As on 31st March 2019 a total of 3525013 Equity Sharesof the Company which translates to 9307 of the ShareCapital stood dematerialised The processing activitieswith respect to requests received for dematerialisation arecompleted between fifteen to thirty daysShareholder Investor ComplaintsThe Company attends to Shareholder Investor complaintsqueries and other correspondence generally within fifteendays except where constrained by disputes or legalimpedimentsThe Company did not receive any complaint during thefinancial year ended 31st March 2019The e-mail ID earmarked by the Company for this purposeghlinvestorsyahoocoinDistribution of Shareholding as on 31st March 2019
No of No of EquityNo of Shareholders Shares
SharesSlab Total to Total to
Share Shareholders Capital
1 - 500 5152 9455 587438 1551501 - 1000 138 253 112061 296
1001 - 2000 68 125 100167 2652001 - 3000 26 048 62030 1643001 - 4000 16 029 58804 1554001 - 5000 11 020 50785 1345001 - 10000 23 042 163405 431
10001 - 50000 8 015 147787 39050001 - 100000 3 006 226954 599
100001 amp Above 4 007 2278084 6015Total 5449 10000 3787515 10000
Categories of Shareholders as on 31st March 2019Sl Category No of toNo Shares Share
held hold ingA Promoter Holding1 Promoter and Promoter Group
ITC Limited 1733907 4578Russell Investments Limited 300056 792Sub-Total 2033963 5370
B Non Promoter Holding2 Institutional Investorsa Mutual Funds NIL NILb Banks 100 000c Foreign Institutional Investors and NIL NIL
Foreign Portfolio InvestorsSub-Total 100 000
3 Othersa Private Corporate Bodies 193726 511b Indian Public 1335461 3527c NRIs 102362 270d Others 121903 322
Sub Total 1753452 4630Grand Total 3787515 10000
18
Monthly High and Low Quotes and Volume of Sharestraded on BSE Limited
Year Month High L o w Volume(` ) (` ) (Nos)
2018 April 13800 12000 93584May 13100 11710 26778June 12735 11500 18090July 12195 11400 27113August 12295 11450 14900September 12000 10900 23492October 11400 10505 18787November 12975 10700 15386December 11490 10700 40291
2019 January 11320 10700 22160February 11185 10005 12395March 11295 10400 21625
Performance in comparison to broad based indices suchas SampP BSE Sensex
Note - Indicates monthly closing positions
Listing of Shares on Stock Exchange (with Stock Code)BSE Limited (507960)Phiroze Jeejeebhoy Towers Dalal Street Mumbai 400 001Telephone Nos 022-2272 1233 34Facsimile No 022-2272 1919E-mail isbseindiacomWebsite wwwbseindiacom
The Listing Fee for the financial year 2019-20 has beenpaid to BSE Limited
Financial CalendarFinancial Year 2019-20(1st April - 31st March)
1 First Quarter Results July 20192 Second Quarter and October November 2019
Half-Year Results3 Third Quarter Results January February 20204 Fourth Quarter and May 2020
Annual Results
Particulars of past three AGMsAGM Financial Venue Date Time Special
Year ResolutionPassed
36th 2017-18 WelcomHotel 07-08-2018 NoneVadodara
35th 2016-17 R C Dutt Road 08-08-2017 1100 NoneAlkapuri am
34th 2015-16 Vadodara 20-09-2016 None390 007
Postal Ballot
No special resolution requiring postal ballot was eitherproposed last year or is being proposed for the ensuing AGM
SHAREHOLDER REFERENCER
Transfer of Shares in certificate form
Effective 1st April 2019 transfer of shares of a listedcompany can only be effected in dematerialised form interms of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 Shareholders holdingshares in the certificate form are therefore requested todematerialise their shares in their own interestCommunication in this respect has been sent by theCompany during the year to the concerned ShareholdersHowever transfer deeds which were lodged with theCompany on or before 31st March 2019 but were returneddue to any deficiency will be processed upon re-lodgement
Transfer of Dividend and corresponding Equity Shares tothe Investor Education and Protection Fund (IEPF)
During the financial year 2018-19 unclaimed dividend forthe financial year 2010-11 aggregating ` 636444- andthe corresponding 13150 Equity Shares in respect of whichdividend entitlements remained unclaimed for sevenconsecutive years or more have been transferred by theCompany to the IEPF established by the CentralGovernment pursuant to the provisions of Section 124 ofthe Companies Act 2013 read with the Investor Educationand Protection Fund Authority (Accounting Audit Transferand Refund) Rules 2016
Shareholders may claim their unclaimed dividend for theyears prior to and including the financial year 2010-11 andthe corresponding shares from the IEPF Authority byapplying in the prescribed Form No IEPF-5 This Form canbe downloaded from the website of the IEPF Authoritywwwiepfgovin the access link of which is also availableon the Companys website wwwgujarathotelsltdin underthe section General Information under Shareholder Value
The unclaimed dividend for the undernoted years and thecorresponding shares will be transferred by the Companyto the IEPF in accordance with the schedule given belowAttention in particular is drawn that the unclaimed dividendfor the financial year 2011-12 and the corresponding shareswill be due for transfer to the IEPF on 14th September
SHAREHOLDER INFORMATION
19
Central Depository Services (India) LimitedMarathon Futurex A Wing 25th FloorMafatlal Mill Compound N M Joshi MargLower Parel Mumbai 400 013Telephone No 022-2302 3333Facsimile No 022-2300 2035E-mail helpdeskcdslindiacomWebsite wwwcdslindiacomRemittance of Dividend through Electronic ModeThe Company provides the facility for remittance of dividendto Shareholders through RTGS (Real Time GrossSettlement) NACH (National Automated Clearing House) NEFT (National Electronic Funds Transfer)
Shareholders who have not opted for remittance of dividendthrough electronic mode and wish to avail the same arerequired to provide their bank details including IFSC (IndianFinancial System Code) and MICR (Magnetic Ink CharacterRecognition) to their respective Depository Participants(DPs) or to the RTA where shares are held in thedematerialised form and in the certificate form respectively
Shareholders holding shares in the certificate form mayuse the Mandate Form for this purpose which can bedownloaded from the Companys websitewwwgujarathotelsltdin under the section GeneralInformation under Shareholder Value
Address and Bank DetailsShareholders holding shares in the certificate form arerequested to advise the RTA of any change in their address mandate bank details to facilitate better servicingShareholders are advised that as a measure of protectionagainst fraudulent encashment their bank details oraddress as available with the RTA will be printed on thedividend warrants or demand drafts where dividend cannotbe remitted through electronic mode
Permanent Account Number (PAN)Shareholders holding shares in the certificate form arerequested to send copies of their PAN Cards to the RTA tofacilitate better servicing
Furnishing of PAN Card however is mandatory as followsi) Transferees and Transferors PAN Cards for transfer
of sharesii) Legal heirs Nominees PAN Cards for transmission
of sharesiii) Surviving joint holders PAN Cards for deletion of name
of deceased Shareholders andiv) Joint holders PAN Cards for transposition of shares
Nomination Facility
Shareholders who hold shares in the certificate form andwish to make any nomination change nomination madeearlier in respect of their shareholding in the Companyshould submit to the RTA the prescribed Form such Formcan be downloaded from the Companys website underthe section Investor Relations under Shareholder Value
SHAREHOLDER INFORMATION
2019 for which purpose communication has been sent tothe concerned Shareholders advising them to write to theCompany to claim their dividend Notices in this regardhave also been published in newspapers Details of suchunclaimed dividend and corresponding shares areavailable on the Companys website under the sectionGeneral Information under Shareholder Value
Financial Date of declaration Due date for transferYear of Dividend to IEPF2011-12 8th August 2012 14th September 2019
2012-13 13th August 2013 19th September 2020
2013-14 29th September 2014 5th November 2021
2014-15 29th September2015 5th November 2022
2015-16 20th September 2016 26th October 2023
2016-17 8th August 2017 14th September 2024
2017-18 7th August 2018 12th September 2025
The Company will not be able to entertain any claim receivedafter 12th September 2019
Shareholders who have not so far encashed their dividendwarrant(s) or have not received the same are requested toapply for duplicate warrant(s) by writing to the Companyand confirming non-encashment non-receipt of dividendwarrant(s)
Service of Documents
The Company sends Notices Report and Accounts andother communications in electronic mode to thoseShareholders who have registered their e-mail addresseswith the Company or with the Depositories and in physicalmode to the other Shareholders
Shareholders who wish to register or update their e-mailaddresses with the Company may use the Form forregistration updation which can be downloaded from theCompanys website under the section Investor Relationsunder Shareholder Value
Depository Services
Shareholders may write to the respective Depository or tothe RTA for guidance on depository services
The contact details of the Depositories are given below
National Securities Depository LimitedTrade World A Wing 4th FloorKamala Mills CompoundSenapati Bapat Marg Lower ParelMumbai 400 013Telephone No 022-2499 4200Facsimile No 022-2497 6351E-mail infonsdlcoinWebsite wwwnsdlcoin
20
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
FOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019Your Directors submit their Report for the financial yearended 31st March 2019
BUSINESS ENVIRONMENT
The global economic growth softened to 36 in 2018representing a marked slowdown compared to the 39growth anticipated at the beginning of the year buoyed bya strong fiscal expansion in the USA which was offset largelyby slower growth in some other large economies ieEurope Japan etc Going forward global growth in 2019 isprojected to decline further to 33 in the base case withrisks to the downside emanating from politicaluncertainties rising trade tensions escalatingprotectionism and tighter financial conditions
As per Ministry of Statistics amp Programme Implementation(MSPI) Indian economy registered the GDP growth of 7in 2018-19 as compared to 72 in 2017-18 The economyis expected to grow and maintain a level of 75 in 2019and 2020 as per the World Bank estimates
India is the most digitally-advanced traveller nation in termsof digital tools being used for planning booking andexperiencing a journey During 2018 foreign tourist arrivals(FTAs) in India stood at 1056 million achieving a growthrate of 52 year-on-year The Government of India is alsoworking to achieve 1 share in worldrsquos international touristarrivals by 2020 and 2 share by 2025
The operating environment in the hospitality sector showedimprovement with foreign tourist arrivals Indiarsquos risingmiddle class and increasing disposable incomes havecontinued to support the growth of domestic tourism
With the inauguration of Statue of Sardar Vallabhbhai Patelalso known as lsquoStatute of Unityrsquo which is the higheststanding statue in the world at a height of 182 meters thetourism in the city of Vadodara is expected to grow
FINANCIAL PERFORMANCE
During the year under review your Company earned licensefees of ` 36987 lakhs (previous year ` 33098 lakhs)Theother income at ` 19626 lakhs showed an increase mainlydue to improvement in return on current investment Preand post-tax profits increased to ` 51822 lakhs (previousyear ` 45313 lakhs) and ` 40788 lakhs (previous year` 33690 lakhs) respectively
Your Directors are pleased to recommend a dividend of` 350 per Equity Share of ` 10- each for the year ended31st March 2019 thereby maintaining last yearrsquos dividendand involving a cash outflow of ` 160 lakhs includingDividend Distribution Tax of ` 27 Lakhs
PROFITS DIVIDEND AND RETAINED EARNINGS
The financial results of your Company summarised areas under
For the year ended For the year ended31st March 2019 31st March 2018
Profits (` ) (` )
a Profit Before Tax 51822363 45312928
b Tax Expense
Current Tax 11653499 9272310Deferred Tax (618755) 2350502
c Profit for the year 40787619 33690116
d Other Comprehensive Income - -
e Total Comprehensive Income 40787619 33690116
Statement of Retained Earningsa At the beginning of the year 213211090 195873461
b Add Total Comprehensive Income 40787619 33690116
c Less Dividend paid including IncomeTax on Dividend paid 15981176 15954974
d Less Income Tax on Dividend paid forearlier year - 397513
e At the end of the year 238017533 213211090
Your Directors are pleased to recommend a dividend of` 350 per Equity Share (Previous Year ` 350) of ` 10-each for the year ended 31st March 2019
Details of changes in Key Financial Ratio amp Return onNet Worth
The key financial ratio of the Company where there hasbeen significant change (25 or more) and change inReturn on Net Worth are summarized below pursuant toSchedule V (B) to the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements)Regulations 2015 (Listing Regulations 2015)
HOTEL OPERATIONS
Your Hotel WelcomHotel Vadodara licensed to ITC Limitedrecorded an income of ` 249443 lakhs during the year ascompared to ` 221856 lakhs in the previous year Therewas an improvement in both occupancy and average roomrates leading to an overall improvement in HotelPerformance
Financial Ratio
2018-19 2017-18 Change
Reason for change
Current Ratio
278 223 25 Increase in value of current investment based on accumulation of market return and fresh investment done during the year out of surplus funds
Return on Net Worth
133 120 11 Due to higher rate of growth in profit after tax
21
The Food amp Beverage segment of your Companyrsquos Hotelcontinues to be a major strength The Peshawri Restaurantand the Welcom Cafeacute Cambay both retained their premiumleadership positions
Your Company has filed a writ petition in the Gujarat HighCourt seeking that the Gujarat State Government be directedto take action on your Companyrsquos application to have theleasehold land of the Hotel converted to freehold andtransferred to your Company as per the existing governmentpolicy in this regard The Honourable High Court passedan Order on 24th December 2014 restraining the StateGovernment from disturbing the peaceful and actualpossession of the Company over the hotel property in anymanner including construction thereon The writ petition ispending
Your Company is also making all efforts for expeditiousconversion of land from leasehold to freehold or in thealternative extension of Lease For further details pleaserefer to Note no 20A of the Accounts
SUBSIDIARIES ASSOCIATES AND JOINT VENTURES
The Company does not have any subsidiary associate orjoint venture
INTERNAL FINANCIAL CONTROLS
Your Company is managed by the Board of Directors andthe Executive Management with clearly defined rolesresponsibilities and authorities The Executive Managementis responsible for the day-to-day conduct of the affairs ofthe Company within the overall framework approved by theBoard Your Company also has a Code of Conduct whichrequires management to conform to the required financialand accounting policies systems and processes conductbusiness ethically and ensure strict compliance with allapplicable laws and regulations Ongoing ReviewProcesses and the Risk Management Framework create acontrol environment in the Company and provide thecornerstones for Internal Financial Controls with referenceto your Companyrsquos Financial Statements
Your Companyrsquos Financial Statements are prepared on thebasis of the Significant Accounting Policies that are carefullyselected by the management and approved by the AuditCommittee and the Board These Policies are reviewedand updated from time to time and audited by the InternalAuditor whose findings and recommendations are reviewedby the Audit Committee and tracked through toimplementation
Your Company maintains its Books of Account in electronicform Your Company has in place adequate internalfinancial controls with reference to the FinancialStatements
The Internal Auditors of the Company evaluates theadequacy and efficacy of such internal financial controlsSuch controls have been assessed during the year by the
management Based on the results of this assessmentno reportable material weakness or significant deficienciesin the design or operation of internal financial controls wereobserved Nonetheless your Company recognises that anyinternal financial control framework no matter how welldesigned has inherent limitations and accordingly regularaudit and review processes ensure that such systems arereinforced on an ongoing basis
RISK MANAGEMENT
Your Company continues its emphasis on a systems-basedapproach to business risk managementBacked by stronginternal control systems the current Risk Managementframework consists of the following key elements
- The Board of Directors (lsquoThe Boardrsquo) has clearly laiddown the roles and responsibilities of the Company inrelation to risk management covering a range ofresponsibilities from strategic to operational Theserole definitions provide the foundation for yourCompanyrsquos Risk Management Policy that is endorsedby the Board and is aimed at ensuring formulation ofappropriate risk management procedures theireffective implementation and independent monitoringand reporting by Internal Audit
- Management of risks vest with the ExecutiveManagement which is responsible for the day-to-dayconduct of the affairs of the Company within the overallframework approved by the Board
- A combination of policies and procedures which areregularly reviewed and updated in the light of changingbusiness and regulatory environment bringsrobustness to the process of ensuring that businessrisks are effectively addressed
- Appropriate structures are in place to proactivelymonitor and manage the inherent risks in businesswith unique relatively high risk profiles
- An Independent Internal Audit Firm carries out riskfocused audits enabling identification of areas whererisk management processes may need to bestrengthened
- The Audit Committee of the Board reviews the InternalAudit findings and provides strategic guidance oninternal controls The Chief Executive Officer closelymonitors the internal control environment within yourCompany including implementation of the action plansemerging out of internal audit findings
The combination of policies and processes as outlinedabove adequately address the various risks associatedwith your Companyrsquos business
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
22
AUDIT AND SYSTEMS
Your Company believes that internal control is a necessaryadjunct to the principle of governance that freedom ofmanagement should be exercised within a framework ofappropriate checks and balances Your Company remainscommitted to ensuring an effective internal controlenvironment that provides assurance and comfort on orderlyand efficient conduct of operations security of assetsprevention and detection of frauds errors accuracy andcompleteness of accounting records and timely preparationof reliable financial information
Your Companyrsquos independent and robust Internal Auditprocesses provide assurance on the adequacy andeffectiveness of internal controls compliance withoperating systems internal policies and regulatoryrequirements
The Internal Audit function consisting of an outsourcedprofessional firm is adequately resourced to deliver highstandards of audit assurances
The Audit Committee of your Board met four times duringthe year The Terms of Reference of the Audit Committeeincluded reviewing the adequacy and effectiveness of theinternal control environment monitoring implementationof the action plans emerging out of Internal Audit findingsincluding those relating to strengthening of your Companyrsquosrisk management systems and discharge of statutorymandate
HUMAN RESOURCE DEVELOPMENT
Your Company firmly believes that employees are the vitaland most valuable assets and hence has created afavourable work environment that encourages innovationand meritocracy Your Company continues to innovate inthe way human resources are managed and developedstriking a balance between business needs and individualaspirations
With an undying commitment to render delightful servicesyour Companyrsquos employees consistently work towardsdelivering flawless performance and are continuing todelight customers
The Company provides a safe secure inclusive and genderfriendly workplace The Company has put in placeGrievance Redressal Procedures and adopted a Policy onSexual Harassment as per the provisions of the SexualHarassment of W omen at W orkplace (PreventionProhibition and Redressal) Act 2013 and the Rules framedthereunder The Company has an Internal ComplaintsCommittee to ensure that grievances in this regard if anyare effectively addressed During the year under review nocomplaint relating to sexual harassment has beenreceived
WHISTLEBLOWER POLICY
The Companyrsquos W histleblower Policy encouragesDirectors and employees to bring to the Companyrsquosattention instances of unethical behavior actual orsuspected incidents of fraud actual or suspectedinstances of leak of unpublished price sensitive informationor violation of the GHL Code of Conduct that could adverselyimpact the Companyrsquos operations business performanceand or reputation The Policy provides that the Companyinvestigates such incidents when reported in an impartialmanner and takes appropriate action to ensure that therequisite standards of professional and ethical conductare always upheld It is the Companyrsquos Policy to ensurethat no employee is victimised or harassed for bringingsuch incidents to the attention of the Company
The practice of the Whistleblower Policy is overseen by theAudit Committee and no employee has been denied accessto the Committee The Whistleblower Policy is available onthe Companyrsquos website at httpwwwgujarathotelsltdinCorporateGovernancehtml
DEPOSITS
Your Company has not accepted any deposits from thepublic members under Section 73 of the Companies Act2013 (lsquothe Actrsquo) read with the Companies (Acceptance ofDeposits) Rules 2014 during the year
DIRECTORS
Changes in Directors
Mr R C Mehta stepped down as Non-Executive IndependentDirector of the Company with effect from close of work on31st March 2019 keeping in view the Regulation 17(1A) ofthe Listing Regulations 2015 Your Directors would like torecord their appreciation for the services rendered byMr Mehta
The Board at the meeting held on 15th April 2019 on therecommendation of the Nominations and RemunerationCommittee recommended for the approval of the Membersthe re-appointment of Mr C K Koshy and Mr M Narayananas independent directors of your Company in terms ofSection 149 of the Act and Regulation 17 of the ListingRegulations 2015 with effect from 29th September 2019
Requisite Notices under Section 160 of the Act have beenreceived in respect of Messrs Koshy and Narayanan whohave filed their consents to act as Directors of the Companyif appointed
Appropriate resolutions seeking your approval to theaforesaid appointment will appear in the Notice conveningthe Thirty Seventh AGM of your Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
23
Retirement by Rotation
In accordance with the provisions of Section 152 of the Actread with Article 147 of the Articles of Association of theCompany Mr Jagdish Singh will retire by rotation at theensuing Annual General Meeting (lsquoAGMrsquo) of your Companyand being eligible offers himself for re-election Your Boardrecommends his re-election
Number of Board Meetings
During the year ended 31st March 2019 four meetings ofthe Board were held
Attributes Qualifications amp Independence of Directorsand their Appointment
As reported last year the Nominations and RemunerationCommittee of the Board had approved the criteria fordetermining qualifications positive attributes andindependence of Directors in terms of the Act and the Rulesthereunder both in respect of Independent Directors andother Directors as applicable The criteria inter aliarequires that NonndashExecutive Directors includingIndependent Directors be drawn from amongst eminentprofessionals with experience in business finance law public administration and enterprises
The Board Diversity Policy of the Company requires theBoard to have a balance of skills experience and diversityof perspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the lsquoReport on CorporateGovernancersquo forming part of the Report and Accounts TheArticles of Association of the Company provide that thestrength of the Board shall not be fewer than three normore than twelve
Directors are appointed re-appointed with the approval ofthe Members All Directors other than IndependentDirectors are liable to retire by rotation unless otherwiseapproved by the Members One-third of the Directors whoare liable to retire by rotation retire every year and areeligible for re-election
The Independent Directors of your Company haveconfirmed that (a) they meet the criteria of independenceas prescribed under Section 149 of the Act and Regulation16 of the Listing Regulations 2015 and (b) they are notaware of any circumstance or situation which could impairor impact their ability to discharge duties with an objectiveindependent judgement and without any external influenceFurther in the opinion of the Board the IndependentDirectors fulfil the conditions prescribed under the ListingRegulations 2015 and are independent of the managementof the Company
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpw w wg u j a ra th o te ls l td in p o l i c ies R em u n era t io n -
Policy_GHLpdf There has been no change in the Policyduring the year
Board Evaluation
The Nominations and Remuneration Committee hasapproved the Policy on Board Evaluation Evaluation ofBoard Committeesrsquo functioning and individual DirectorEvaluation and also specified that such evaluation will bedone by the Board Board performance is assessed againstthe role and responsibilities of the Board as provided inthe Act and the Listing Regulations 2015 The parametersfor Board performance evaluation have been derived fromthe Boardrsquos core role of trusteeship to protect and enhanceshareholder value as well as fulfil expectations of otherstakeholders through strategic supervision of the CompanyEvaluation of functioning of Board Committees is basedon discussions amongst Committee members and sharedby each Committee Chairman with the Board IndividualDirectors are evaluated in the context of the role played byeach Director as a member of the Board at its meetingsand in assisting the Board in realising its role of strategicsupervision of the functioning of the Company in pursuit ofits purpose and goals
While the Board evaluated its performance against theparameters laid down by the Nominations andRemuneration Committee the evaluation of individualDirectors was carried out anonymously in order to ensureobjectivity The Board was briefed on functioning of BoardCommittees by the respective Committee Chairmen
Key Managerial Personnel
Mr Deependra Rana resigned as the Chief Executive Officerof the Company with effect from 17th December 2018
The Board at the meeting held on 30th January 2019 onthe recommendation of the Nominations andRemuneration Committee appointed Mr Kunal Pahwa asthe Chief Executive Officer of the Company with effect from1st February 2019
AUDIT COMMITTEE amp AUDITORS
The composition of the Audit Committee is provided underthe section lsquoBoard of Directors amp Committeesrsquo in the Reportand Accounts
Statutory Auditors
The Statutory Auditors Messrs K C Mehta amp Co CharteredAccountants (KCM) were appointed with your approval atthe Thirty Fifth AGM to hold such office till the conclusion ofthe Fortieth AGM
On the recommendation of the Audit Committee the Boardrecommended for the approval of the Members paymentof remuneration of KCM for the financial year 2019-20Appropriate resolution for this purpose will appear in theNotice convening the Thirty Seventh AGM of the Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
24
Secretarial Auditors
Your Board appointed Messrs PB amp Associates CompanySecretaries to conduct the secretarial audit of the Companyfor the financial year ended 31st March 2019 Their Reportis provided in the Annexure forming part of this Report interms of Section 204 of the Act
RELATED PARTY TRANSACTIONS
All contracts or arrangements entered into by the Companywith its related parties during the financial year were inaccordance with the provisions of the Act and the ListingRegulations 2015 All such contracts or arrangements wereentered in the ordinary course of business and on armrsquoslength basis and have been approved by the AuditCommittee
Further the details of related party transactions of theCompany in prescribed Form No AOC-2 in terms of Section134 of the Act read with Rule 8 of the Companies (Accounts)Rules 2014 is given in the Annexure to this Report YourCompanyrsquos Policy on Related Party Transactions asadopted by your Board can be accessed on the website ath t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_Transactionspdf
DIRECTORSrsquo RESPONSIBILITY STATEMENT
As required under Section 134 of the Act your Directorsconfirm having
a) followed in the preparation of the Annual Accounts theapplicable Accounting Standards with properexplanation relating to material departures if any
b) selected such accounting policies and applied themconsistently and made judgements and estimates thatare reasonable and prudent so as to give a true andfair view of the state of affairs of your Company at theend of the financial year and of the profit of yourCompany for that period
c) taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with theprovisions of the Act for safeguarding the assets ofyour Company and for preventing and detecting fraudand other irregularities
d) prepared the Annual Accounts on a going concernbasis
e) laid down internal financial controls to be followed byyour Company and that such internal financial controlswere adequate and operating effectively and
f) devised proper systems to ensure compliance withthe provisions of all applicable laws and that suchsystems were adequate and operating effectively
OTHER INFORMATION
Compliance with the conditions of Corporate Governance
The certificate of the Statutory Auditors Messrs K C Mehtaamp Co Chartered Accountants confirming compliance withthe conditions of Corporate Governance as stipulated underthe Listing Regulations 2015 is annexed
Compliance with Secretarial Standards
The Company is in compliance with the applicableSecretarial Standards issued by the Institute of CompanySecretaries of India and approved by the CentralGovernment under Section 118 of the Act
Cost Records
The Company is not required to maintain cost records interms of Section 148 of the Act read with the Companies(Cost Records and Audit) Rules 2014
Going Concern Status
There is no significant or material order passed during theyear by any regulator court or tribunal impacting the goingconcern status of the Company or its future operations
Extract of Annual Return
The information required under Section 134 of the Act readwith Rule 12 of the Companies (Management andAdministration) Rules 2014 is annexed
Particulars of Loans Guarantees or Investments
During the year ended 31st March 2019 the Company hasneither given any loan or guarantee nor has made anyinvestment under the provisions of Section 186 of the Act
Particulars relating to Conservation of Energy andTechnology Absorption
Particulars as required under Section 134 of the Act relatingto Conservation of Energy and Technology Absorption areprovided below-
Conservation of Energy
Steps taken on conservation of energy and impact thereof
Sl DescriptionNo
1 Installation of energy efficient Gas Burners and Induction Cooker
2 Improvement in energy usage efficiency in lighting system by changingover to efficient lighting solutions such as Light Emitting Diodes
3 Replacement of existing motors and pumps with more energy efficientequipment
4 Process improvement to enhance productivity and reduce specificenergy consumption
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
25
There were no employees who were employed throughoutthe year and were in receipt of remuneration aggregating` 102 crores or more or were employed for part of the yearand were in receipt of remuneration aggregating ` 850lakhs per month or more during the financial year ended31st March 2019
The information pursuant to Section 197 of the Act readwith Rule 5(2) and 5(3) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014containing the names of top 10 employees in terms ofremuneration drawn is provided in the Annexure formingpart of this report
The information required under Section 197(12) of the Actand the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is provided in theAnnexure forming part of this Report
FORWARD-LOOKING STATEMENTS
This Report contains forward-looking statements thatinvolve risks and uncertainties When used in this Reportthe words lsquoanticipatersquo lsquobelieversquo lsquoestimatersquo lsquoexpectrsquo lsquointendrsquolsquowillrsquo and other similar expressions as they relate to theCompany and or its Businesses are intended to identifysuch forward-looking statements The Companyundertakes no obligation to publicly update or revise anyforward-looking statements whether as a result of newinformation future events or otherwise Actual resultsperformances or achievements could differ materially fromthose expressed or implied in such forward-lookingstatements Readers are cautioned not to place unduereliance on these forward-looking statements that speakonly as of their dates This Report should be read inconjunction with the financial statements included hereinand the notes thereto
CONCLUSION
Your Directors and employees look forward to the futurewith confidence and stand committed to creating an evenbrighter future for all stakeholders
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
Steps taken by the Company for utilising alternate sourcesof energy NIL
Capital investment on energy conservation equipment NIL
Technology Absorption
i) Efforts in brief made towards technology absorptionand benefits derived as a result of the above effortseg product improvement cost reduction productdevelopment import substitution etc
Sl Description BenefitsNo
1 Upgradation of Fire Alarm and For Product UpgradationPublic Announcement system
2 Installation of Hoods and Fire For Product UpgradationSuppression system
3 Upgradation of CCTV monitoring For Product Upgradationsystem
4 Upgradation of Electrical Panel For Product Improvement5 Induction of Diesel Generator For Product Improvement
ii) In case of imported technology (imported during thelast 3 years reckoned from the beginning of the financialyear) following information may be furnished
A) Details of technology imported - NIL
B) Year of import - NIL
C) Whether the technology has been fully absorbed -NIL
D) If not fully absorbed areas where absorption hasnot taken place and the reasons therefor - NIL
iii) Expenditure incurred on research and development -NIL
FOREIGN EXCHANGE EARNINGS AND OUTGO
During the financial year 2018-19 foreign exchangeearnings of the Hotel aggregated ` 111754 lakhs (previousyear ` 95887 lakhs) while expenditure in foreign currencyaggregated ` 5514 lakhs (previous year ` 3230 lakhs)
EMPLOYEES
The total number of employees of the Company as on31st March 2019 stood at 198
26
ANNEXURE
FORM NO MR ndash 3SECRETARIAL AUDIT REPORTFOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019[Pursuant to Section 204(1) of the Companies Act 2013 and Rule9 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014]
ToThe MembersGujarat Hotels LimitedWe have conducted the secretarial audit of the compliance ofapplicable statutory provisions and the adherence to goodcorporate practices by Gujarat Hotels Limited a Companyincorporated under the provisions of the Companies Act 1956 andhaving its Registered Office at WelcomHotel Vadodara R C DuttRoad Alkapuri Vadodara Gujarat ndash 390 007 (hereinafter referredto as the lsquoCompanyrsquo) for the period commencing from 1st April2018 till 31st March 2019 (hereinafter referred to as the lsquoAuditPeriodrsquo) Secretarial Audit was conducted in a manner that providedus a reasonable basis for evaluating the corporate conducts statutory compliances and expressing our opinions thereonBased on our verification of the books papers minute booksforms and returns filed and other records maintained by theCompany and also the information provided by the Company itsofficers agents and authorised representatives during the conductof Secretarial Audit 2018-19 we hereby report that in our opinionthe Company has during the audit period covering the FinancialYear ended on 31st March 2019 complied with the statutoryprovisions listed hereunder and also that the Company has properBoard-processes and compliance-mechanism in place to theextent in the manner and subject to the reporting made hereinafterWe have examined the books papers minute books forms andreturns filed and other records maintained by the Company for thefinancial year ended on 31st March 2019 according to theprovisions of(i) The Companies Act 2013 (the Act) and the Rules made
thereunder(ii) The Securities Contracts (Regulation) Act 1956 (lsquoSCRArsquo)
and the Rules made thereunder(iii) The Depositories Act 1996 and the Regulations and
Bye-laws framed thereunder(iv) Foreign Exchange Management Act 1999 and the Rules and
Regulations made thereunder to the extent of Foreign DirectInvestment Overseas Direct Investment and ExternalCommercial Borrowings
(v) The following Regulations and Guidelines prescribed underthe Securities and Exchange Board of India Act 1992(lsquoSEBI Actrsquo)-(a) The Securities and Exchange Board of India
(Substantial Acquisition of Shares and Takeovers)Regulations 2011
(b) The Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations 2015
(c) The Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations2015
(d) The Securities and Exchange Board of India(Registrars to an Issue and Share Transfer Agents)Regulations 1993 regarding the Companies Act anddealing with client
We have also examined compliance with the applicable clauses ofthe following(i) The mandatory Secretarial Standards issued by The Institute
of Company Secretaries of India with respect to BoardMeetings and General Meetings
(ii) The SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015
The Company has entered into an Operating Licence Agreementwith ITC Limited which operates the Hotel ndash WelcomHotel Vadodraand ensure compliance of all laws as applicable for running andmaintenance of the HotelDuring the period under review the Company has complied withthe provisions of the Act Rules Regulations Guidelines andStandards etc as mentioned above however in the CorporateGovernance Report filed pursuant to Regulation 27(2) of SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015with BSE for the quarter ended September and December 2018there is mismatch of date of the meetingWe further report thatThe Board of Directors of the Company is duly constituted withproper balance of Non-Executive Directors and IndependentDirectors The changes in the composition of the Board of Directorsthat took place during the period under review were carried out incompliance with provisions of the ActAdequate notice is given to all Directors for the Board Meetingsand Committees Meetings agenda and detailed notes on agendawere sent at least seven days in advance and where the meetingwas held in shorter notice due compliance was made and a systemexists for seeking and obtaining further information and clarificationson the agenda items before the meeting for meaningful participationat the meetingAll decisions at Board Meetings and Committee Meetings werecarried out unanimously as recorded in the minutes of the meetingsof the Board of Directors or Committees of the Board as the casemay beWe report that there are adequate systems and processes in theCompany commensurate with the size and operations of theCompany to monitor and ensure compliance with the applicableLaws Rules Regulations and GuidelinesWe further report that during the Audit Period the Company has nospecific events actions that have a major bearing on the Companyrsquosaffairs in pursuance of the above referred Laws RulesRegulations Guidelines Standards etc
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
Note This report is to be read with our letter of even date whichis annexed as Annexure A and forms an integral part of thisreport
27
FORM NO AOC-2[Pursuant to Section 134(3)(h) of the Companies Act 2013 and Rule 8(2) of the Companies (Accounts) Rules 2014]
Form for disclosure of particulars of contracts arrangements entered into by the Company with related parties referred to insub-section (1) of Section 188 of the Companies Act 2013 including certain arms length transactions under fourth proviso thereto
1 Details of contracts or arrangements or transactions not at arms length basis
a) Name(s) of the related party and nature of relationshipb) Nature of contracts arrangements transactionsc) Duration of the contracts arrangements transactionsd) Salient terms of the contracts or arrangements or transactions including the value if anye) Justification for entering into such contracts or arrangements or transactions NILf ) Date(s) of approval by the Boardg) Amount paid as advances if anyh) Date on which the special resolution was passed in general meeting as required under first proviso to Section 188
2 Details of material contracts or arrangement or transactions at arms length basis
a) Name(s) of the related party and nature of ITC Limited of which the Company is an Associaterelationship
b) Nature of contracts arrangements transactions Agreement for operating the Companyrsquos Hotel
c) Duration of the contracts arrangements Operating License Agreement (OLA) dated 24th September 1992 for an initialtransactions period of 30 years and renewable for another period of 30 years The OLA
emanated from the rehabilitation package agreed amongst Gujarat State GovtFinancial Institutions viz IFCI amp SBI and ITC in the year 1990
d) Salient terms of the contracts or arrangements The Company receives Licence fees 15 of Net Operating Income Valueor transactions including the value if any of transaction during the year ` 370 crores
e) Date(s) of approval by the Board if any 24th September 1992f ) Amount paid as advances if any Nil
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Annexure AToThe MembersGujarat Hotels Limited
Our report of even date is to be read along with this letter
1 Maintenance of secretarial record is the responsibilityof the management of the Company Our responsibilityis to express an opinion on these secretarial recordsbased on our audit
2 We have followed the audit practices and processesas were appropriate to obtain reasonable assuranceabout the correctness of the contents of the secretarialrecords The verification was done on the randomtest basis to ensure that correct facts are reflected insecretarial records We believe that the processesand practices we followed provide a reasonablebasis for our opinion
3 W e have not verified the correctness andappropriateness of financial records and books ofaccounts of the Company
4 W herever required we have obtained theManagement Representation about the complianceof Laws Rules and Regulations and happening ofevents etc
5 The compliance of the provisions of corporate andother applicable Laws Rules RegulationsStandards is the responsibility of management Ourexamination was limited to the verification ofprocedures on the random test basis
6 The Secretarial Audit Report is neither an assuranceas to the future viability of the Company nor of theefficacy or effectiveness with which the managementhas conducted the affairs of the Company
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
28
INDEPENDENT AUDITORSrsquo CERTIFICATE ON CORPORATE GOVERNANCE
INDEPENDENT AUDITORrsquoS CERTIFICATE ON CORPORATEGOVERNANCE
TO THE MEMBERS OF GUJARAT HOTELS LIMITED
1 We have examined the compliance of conditions ofCorporate Governance by Gujarat Hotels Limited (ldquotheCompanyrdquo) for the year ended on 31st March 2019as stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the Securities and Exchange Board ofIndia (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended(ldquoSEBI Listing Regulationsrdquo)
Managementrsquos Responsibility
2 The compliance of conditions of CorporateGovernance is the responsibility of the ManagementThis responsibility includes the designimplementation and maintenance of internal controland procedures to ensure the compliance with theconditions of the Corporate Governance stipulated inSEBI Listing Regulations
Auditorrsquos Responsibility
3 Our responsibility is limited to examining theprocedures and implementation thereof adopted bythe Company for ensuring the compliance of theconditions of the Corporate Governance It is neitheran audit nor an expression of opinion on the financialstatements of the Company
4 We have examined the books of account and otherrelevant records and documents maintained by theCompany for the purpose of providing reasonableassurance on the compliance with CorporateGovernance requirements by the Company
5 We have carried out an examination of the relevantrecords of the Company in accordance with theGuidance Note on Certification of CorporateGovernance issued by the Institute of CharteredAccountants of India (ldquothe ICAIrdquo) the Standards onAuditing specified under Section 143(10) of theCompanies Act 2013 in so far as applicable for the
purpose of this certificate and as per the GuidanceNote on Reports or Certificates for Special Purposesissued by the ICAI which requires that we comply withthe ethical requirements of the Code of Ethics issuedby the ICAI
6 W e have complied with the relevant applicablerequirements of the Standard on Quality Control (SQC)1 Quality Control for Firms that Perform Audits andReviews of Historical Financial Information and otherAssurance and Related Services Engagements
Opinion
7 Based on our examination of the relevant recordsand according to the information and explanationsprovided to us and representations provided by theManagement we certify that the Company hascomplied with the conditions of Corporate Governanceas stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the SEBI Listing Regulations asapplicable for the year ended 31st March 2019
8 W e state that such compliance is neither anassurance as to the future viability of the Companynor the efficiency or effectiveness with which theManagement has conducted the affairs of theCompany
Restrictions on Use
9 This Certificate is issued solely for the purpose ofcomplying with the aforesaid SEBI ListingRegulations and may not be suitable for any otherpurpose
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
29
ANNEXURE
FORM NO MGT-9EXTRACT OF ANNUAL RETURN
as on the Financial Year ended on 31st March 2019[Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the
Companies (Management and Administration) Rules 2014]
I REGISTRATION AND OTHER DETAILS
i) CIN L55100GJ1982PLC005408ii) Registration Date 7th August 1982iii) Name of the Company Gujarat Hotels Limitediv) Category Sub-Category of the Company Public company - Limited by sharesv) Address of the Registered office and contact details WelcomHotel Vadodara
R C Dutt Road AlkapuriVadodara 390 007Tel No 0265-233 0033E-mail ghlinvestorsyahoocoin
vi) Whether Listed Company Yesvii) Name Address and Contact details of MCS Share Transfer Agent Limited
Registrar and Transfer Agent if any F - 65 Okhla Industrial Area Phase - INew Delhi - 110 020Tel Nos (011) 4140 6149-52 4160 9386
II PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY
III PARTICULARS OF HOLDING SUBSIDIARY AND ASSOCIATE COMPANIES NIL
Sl No
Name and Description of main products services NIC Code of the products services
to total turnover of the Company
1 Hotel Services 55101 100
30
IV SHAREHOLDING PATTERN (Equity Share Capital Break-up as percentage of Total Equity)(i) Category-wise Shareholding
Category of Shareholders No of Shares held at the beginningof the year
No of Shares held at the endof the year
Changeduring the
year
A Promoters(1) Indiana) Individual HUF 0 0 0 0 0 0 0 0 0b) Central Govt 0 0 0 0 0 0 0 0 0c) State Govt(s) 0 0 0 0 0 0 0 0 0d) Bodies Corp 2033963 0 2033963 5370 2033963 0 2033963 5370 0e) Banks FI 0 0 0 0 0 0 0 0 0f ) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(1) 2033963 0 2033963 5370 2033963 0 2033963 5370 0(2) Foreigna) NRIs - Individuals 0 0 0 0 0 0 0 0 0b) Other - Individuals 0 0 0 0 0 0 0 0 0c) Bodies Corp 0 0 0 0 0 0 0 0 0d) Banks FI 0 0 0 0 0 0 0 0 0e) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(2) 0 0 0 0 0 0 0 0 0Total Shareholding of Promoter(A) = (A)(1)+(A)(2) 2033963 0 2033963 5370 2033963 0 2033963 5370 0B Public Shareholding1 Institutionsa) Mutual Funds 0 0 0 0 0 0 0 0 0b) Banks FI 0 100 100 0 100 100 c) Central Govt 0 0 0 0 0 0 0 0 0d) State Govt(s) 0 0 0 0 0 0 0 0 0e) Venture Capital Funds 0 0 0 0 0 0 0 0 0f ) Insurance Companies 0 0 0 0 0 0 0 0 0g) FIIs 10 0 10 0 0 0 h) Foreign Venture Capital Funds 0 0 0 0 0 0 0 0 0i) Others (specify) 0 0 0 0 0 0 0 0 0Sub-total (B)(1) 10 100 110 0 100 100 2 Non-Institutionsa) Bodies Corpi) Indian 300003 2200 302203 798 191626 2100 193726 511 (287)ii) Overseas 0 0 0 0 0 0 0 0 0b) Individualsi) Individual shareholders holding
nominal share capital upto` 1 lakh 774322 231562 1005884 2656 797094 203602 1000696 2643 (013)
ii) Individual shareholders holdingnominal share capital inexcess of ` 1 lakh 220814 0 220814 583 334765 0 334765 884 301
c) Others (specify)i) Non Resident Individuals 44288 71500 115788 306 45662 56700 102362 270 (036)ii) Investor Education and
Protection Fund AuthorityMinistry of Corporate Affairs 108753 0 108753 287 121903 0 121903 322 035
Sub-total (B)(2) 1448180 305262 1753442 4630 1491050 262402 1753452 4630 0Total Public Shareholding(B)=(B)(1)+ (B)(2) 1448190 305362 1753552 4630 1491050 262502 1753552 4630 0C Shares held by Custodian
for GDRs amp ADRs 0 0 0 0 0 0 0 0 0Grand Total (A+B+C) 3482153 305362 3787515 100 3525013 262502 3787515 100 0
Demat Physical Total of TotalShares
Demat Physical Total of TotalShares
ANNEXURE
31
1 Savi Portfolio Management Services LimitedAt the beginning of the year 122218 323Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 122218 323
2 Muktilal Ganulal PaldiwalAt the beginning of the year 82742 218Increase Decrease in Shareholding during the year06042018 220 001 82962 21913042018 250 001 83212 22001062018 927 002 84139 22215062018 700 002 84839 22427072018 412 001 85251 22505102018 1000 003 86251 22830112018 500 001 86751 22931122018 958 003 87709 23218012019 124 000 87833 23208022019 1070 003 88903 23501032019 467 001 89370 23615032019 1000 003 90370 23922032019 200 001 90570 24031032019 50 000 90620 240At the end of the year 90620 240
3 Taradevi Muktilal PaldiwalAt the beginning of the year 31628 084
(ii) Shareholding of Promoters (including Promoter Group)
(iii) Change in Promotersrsquo Shareholding (please specify if there is no change)
SlNo
Shareholders NameNo of
Shares of total
Sharesof the
Company
of Sharespledged
encumbered tototal Shares
No ofShares
of totalShares
of theCompany
of Sharespledged
encumbered tototal Shares
change inShareholding
during the year
1 ITC Limited 1733907 4578 Nil 1733907 4578 Nil Nil
2 Russell Investments Limited 300056 792 Nil 300056 792 Nil Nil
Shareholding at the beginning of the year Shareholding at the end of the year
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
(iv) Shareholding Pattern of top ten Shareholders (other than Directors Promoters and Holders of GDRs and ADRs)
ANNEXURE
No of Shares
Sl No
Particulars Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares of total Shares of the Company
No of Shares of total Shares of the Company
At the beginning of the year
No Change during the year Increase Decrease in Promoters Shareholding during the year
At the end of the year
32
Increase Decrease in Shareholding during the year06042018 180 000 31808 08413042018 53 000 31861 08420042018 1449 004 33310 08827042018 1933 005 35243 09304052018 1060 003 36303 09611052018 2196 006 38499 10218052018 1343 004 39842 10625052018 1191 003 41033 10906072018 1600 004 42633 11313072018 1678 004 44311 11720072018 2095 006 46406 12327072018 3735 010 50141 13303082018 415 001 50556 13410082018 685 002 51241 13624082018 1169 003 52410 13931082018 1616 004 54026 14307092018 1655 004 55681 14714092018 1311 003 56992 15021092018 2480 007 59472 15729092018 2259 006 61731 16305102018 1534 004 63265 16712102018 976 003 64241 17019102018 64 000 64305 17026102018 600 002 64905 17202112018 605 002 65510 17409112018 4 000 65514 17416112018 143 000 65657 17430112018 2299 006 67956 18007122018 515 001 68471 18114122018 10 000 68481 18121122018 590 002 69071 18331122018 600 002 69671 18504012019 1000 003 70671 18825012019 21 000 70692 18801022019 701 002 71393 19008022019 388 001 71781 19115022019 714 002 72495 19301032019 700 002 73195 19515032019 34 000 73229 195At the end of the year 73299 195
4 Shah Viren ShantilalAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 14122018 26965 071
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
ANNEXURE
33
Increase Decrease in Shareholding during theyear ie wef 1412201811012019 28946 076 55911 14701022019 7194 019 63105 166At the end of the year 63105 166
5 Chirayush Pravin VakilAt the beginning of the year 27482 073Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 27482 073
6 Falguni Nilesh DedhiaAt the beginning of the year 18000 048Increase Decrease in Shareholding during the year27042018 5175 014 23175 062At the end of the year 23175 062
7 Classic Realties Private LimitedAt the beginning of the year 23061 061Increase Decrease in Shareholding during the year31082018 100 000 23161 061At the end of the year 23161 061
8 Dheeraj Kumar LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 20000 053
9 Karvy Stock Broking LimitedAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 30112018 23063 061Increase Decrease in Shareholding during theyear ie wef 3011201807122018 149 000 23212 06114122018 (8165) (022) 15047 03931122018 7128 019 22175 05804012019 3087 008 25262 06611012019 (23721) (063) 1541 00331032019 15274 040 16815 043At the end of the year 16815 043 Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company Includes shares acquired during the period when not part of the top ten Shareholders of the Company
10 Sonal LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year20042018 (1000) (003) 19000 050
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
34
311218 0 000 0 00011012019 0 000 0 00031032019 (5000) (013) 14000 037At the end of the year 14000 037 Ceased to be part of the top ten Shareholders of the Company Became a part of the top ten Shareholders of the Company
11 Rajasthan Global Securities Private LimitedAt the beginning of the year 98659 260Increase Decrease in Shareholding during the year20042018 (4756) (013) 93903 24727042018 (5596) (015) 88307 23206072018 (790) (002) 87517 23027072018 (8520) (022) 78997 20802112018 (10975) (029) 68022 17916112018 (4) 000 68018 17930112018 (6189) (016) 61829 16307122018 (170) 000 61659 16314122018 (18503) (049) 43156 11421122018 (417) (001) 42739 11331122018 (11108) (029) 31631 08404012019 (5000) (013) 26631 07111012019 (5000) (013) 21631 05825012019 (2800) (007) 18831 05101022019 0 000 0 000At the end of the year NA NA Ceased to be a part of the top ten Shareholders of the Company
12 Dinesh Mukilal PaldiwalAt the beginning of the year 10522 028Increase Decrease in Shareholding during the year03082018 112 000 10634 02810082018 424 001 11058 02907092018 500 001 11558 03021092018 85 000 11643 03005102018 1000 003 12643 03302112018 0 000 12643 03301022019 0 000 12643 03315022019 300 001 12943 03431032019 0 000 12943 034At the end of the year NA NA Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company
Note Increase decrease in shareholding as indicated above are based on downloads of beneficial ownership provided by the Depositories generally everyFriday
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
35
(v) Shareholding of Directors and Key Managerial Personnel
ANNEXURE
Ms D R Choudhury Messrs C K Koshy R C Mehta M Narayanan and J Singh Directors Messrs M Agarwal andD K Gulati Key Managerial Personnel did not hold any Shares of the Company either at the beginning or at the end of theyear or at any time during the year
Mr K Pahwa Chief Executive Officer also did not hold any Shares of the Company either at the time of his appointment or atthe end of the year or at any time during the year
V INDEBTEDNESSIndebtedness of the Company including interest outstanding accrued but not due for payment NIL
VI REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNELA Remuneration to Managing Director Wholetime Directors and or Manager NOT APPLICABLE
B Remuneration to the other Directors(Amount in `)
Ceased to be Non-Executive Independent Director with close of work on 31st March 2019
Sl No For each of the Director
Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares held singly
jointly
of total Shares of the
Company
No of Shares held singly
jointly
of total Shares of the
Company
1 N Anand (Chairman)
At the beginning of the year 200 0
Increase Decrease in Shareholding during the year
0 0 0 0
At the end of the year 200 0
Sl No Directors
Particulars of Remuneration
Total Amount Fee for attending Board Board
Committee Meetings
Commission Independent Directors
Meeting Fees 1 Independent Directors
C K Koshy 140000 0 10000 150000 R C Mehta 70000 0 0 70000 M Narayanan 140000 0 10000 150000
Total (B)(1) 350000 0 20000 370000 2 Other Non-Executive Directors
N Anand 0 0 0 0 D R Choudhury 0 0 0 0 J Singh 0 0 0 0
Total (B)(2) 0 0 0 0 Total (B) = (B)(1) + (B)(2) 370000 Total Managerial Remuneration (A+B) 370000
Overall ceiling as per the Act (Being 11 of the Net Profits of the Company as calculated under Section 198 of the Companies Act 2013)
3759620
36
C Remuneration to Key Managerial Personnel other than MD Manager WTD(Amount in `)
Mr K Pahwa was appointed as Chief Executive Officer wef 1st February 2019
VII PENALTIES PUNISHMENT COMPOUNDING OF OFFENCES
against the Company Directors and other Officers in Default under the Companies Act 2013 NONE
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Sl No
Particulars of Remuneration Key Managerial Personnel
Total Amount
K Pahwa Chief Executive
Officer
M Agarwal Chief Financial
Officer
D K Gulati Company Secretary
1 Gross Salary
(a) Salary as per provisions contained in Section 17(1) of the Income-tax Act 1961
377472 2883242 880140 4140854
(b) Value of perquisites under Section 17(2) of the Income-tax Act 1961
242908 136154 0 379062
(c) Profits in lieu of salary under Section 17(3) of the Income-tax Act 1961
0 0 0 0
2 Stock Option 0 0 0 0 3 Sweat Equity 0 0 0 0 4 Commission
- as of profit - others specify
0 0 0 0
5 Others please specify 0 0 0 0 Total Amount 620380 3019396 880140 4519916
37
Services reverted to ITC Limited effective 17th December 2018 Reflects revision in remuneration effective 1st October 2018
Notes1 The number of permanent employees as on 31st March 2019 was 1982 Compared to 2017-18 the figures for 2018-19 reflect that
i) Median remuneration of employees - Increased by 965ii) Average remuneration of employees excluding Key Managerial Personnel (KMP) - Increased by 1040 with
increase in number of employeesiii) Remuneration of KMP - Increased by 1321 due to revision in remuneration during the year
3 Remuneration of Directors KMP and other employees is in accordance with the Companys Remuneration Policy
A Information pursuant to Section 197 of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014
Name of Directors ampKey ManagerialPersonnel
Designation Ratio of Remuneration toMedian Remuneration of
all employees
Increase inRemuneration over
LY ()
ANNEXURE
N Anand Non-Executive Chairman - -
D R Choudhury Non-Executive Director - -
C K Koshy Independent Director 0731 7
R C Mehta Independent Director 0341 -
M Narayanan Independent Director 0731 7
J Singh Non-Executive Director - -
D Rana Chief Executive Officer 12681 (15)
K Pahwa Chief Executive Officer (wef 1st February 2019) 3111 -
M Agarwal Chief Financial Officer 15281 24
D K Gulati Company Secretary 4371 8
38
O
n de
puta
tion
from
ITC
Lim
ited
(ITC
)
Ser
vice
s re
verte
d to
ITC
effe
ctiv
e 17
th D
ecem
ber
2018
N
otes
a
Gro
ss r
emun
erat
ion
incl
udes
sal
ary
var
iabl
e pa
y C
ompa
nys
con
tribu
tion
to p
rovi
dent
fun
d a
llow
ance
s amp
oth
er b
enef
its
app
licab
le p
erqu
isite
s ex
cept
pro
visi
ons
for
grat
uity
and
leav
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men
t w
hich
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eter
min
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n an
ove
rall
Com
pany
bas
is
The
ter
m r
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nies
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ctor
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with
Rul
es 5
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and
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App
oint
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ules
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On
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lf of
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rd
Pla
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Dat
e 1
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56
78
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rienc
e(Y
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meAg
e
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Top
ten
empl
oyee
s in
term
s of r
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erat
ion
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nMa
yur A
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al33
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ncial
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er31
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A
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9
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ITC
Limite
dC
SMa
nage
r - Fi
nanc
eDe
epen
dra R
ana
38
Chief
Exe
cutiv
e Of
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2615
119
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Dip
in Ho
tel
1625
0120
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ited
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gmen
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l Man
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ti33
Comp
any
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etary
9017
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m
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e Sec
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ager
Kuna
l Pah
wa
37Ch
ief E
xecu
tive
Offic
er64
0997
2173
09Di
p in
Hote
l15
0102
2019
ITC
Limite
dMa
nagm
ent
Gene
ral M
anag
erSa
ikat S
engu
pta47
Exec
utive
4183
8535
8861
BCo
m
2613
0519
95Jin
dal H
otels
Limite
dFr
ont o
ffice A
ssist
ant
Rajar
am K
ashir
am B
abar
52Se
nior E
xecu
tive
4175
8231
7347
BCo
m
2201
1220
16Ho
tel K
avira
j Ex
ecuti
veVa
sund
hara
Son
awan
e52
Exec
utive
4010
0533
6903
HSC
Cer
tifica
te29
0104
1993
Nil
Cour
se in
Coo
kery
Vada
nsing
h Gum
ansin
gh55
Junio
r Ex
ecuti
ve38
9706
3139
72HS
C D
ip in
Hot
el38
0501
1994
Hotel
Ram
a-inn
Ra
nava
tMa
nagm
ent
Senio
r Cap
tain
Prav
in Ma
kwan
a56
Supe
rviso
r36
4111
3104
078th
Stan
dard
3410
0419
86Do
dsal
Comp
any
Weld
er
INFORMATION US 197 OF THE COMPANIES ACT 2013
39
CEO AND CFO COMPLIANCE CERTIFICATE
We Kunal Pahwa Chief Executive Officer and Mayur Agarwal Chief Financial Officer certify that
a) We have reviewed the financial statements including the cash flow statement for the year ended 31st March 2019 andto the best of our knowledge and belief
i) these statements do not contain any materially untrue statement or omit any material fact or contain statementsthat might be misleading
ii) these statements together present a true and fair view of the Companyrsquos affairs and are in compliance with IndianAccounting Standards applicable laws and regulations
b) To the best of our knowledge and belief no transactions entered into by the Company during the year ended31st March 2019 are fraudulent illegal or violative of the Companyrsquos code of conduct
c) We accept responsibility for establishing and maintaining internal controls for financial reporting and we have evaluatedthe effectiveness of the internal control systems of the Company pertaining to financial reporting Deficiencies in thedesign or operation of such internal controls if any of which we are aware have been disclosed to the auditors and theAudit Committee and steps have been taken to rectify these deficiencies
d) i) There has not been any significant change in internal control over financial reporting during the year underreference
ii) The changes in the Significant Accounting Policies arising from the adoption of the Indian Accounting Standardshave been discussed with the auditors and have been approved by the Audit Committee and
iii) We are not aware of any instance during the year of significant fraud with involvement therein of the managementor any employee having a significant role in the Companyrsquos internal control system over financial reporting
Place New Delhi Kunal Pahwa Mayur AgarwalDate 15th April 2019 Chief Executive Officer Chief Financial Officer
40
BALANCE SHEET
As at 31st March 2019Amount in `
Particulars Note As at As at31st March 2019 31st March 2018
ASSETSNon-Current Assetsa) Property Plant and Equipment 2 14695652 15623727b) Other Non-Current Assets 3 6672434 7609451Total Non-Current Assets 21368086 23233178Current Assetsa) Financial Assets
(i) Investments 4 280294894 208482957(ii) Trade Receivables 5 16310661 14154244(iii) Cash and Cash Equivalents 6 763039 900355(iv) Other Bank Balances 7 5489856 53182631(v) Other Financial Assets 8 4724316 6349124
b) Other Current Assets 3 437564 406324Total Current Assets 308020330 283475635Total Assets 329388416 306708813EQUITY AND LIABILITIESEquitya) Equity Share Capital 9 37875150 37875150b) Other Equity 268275037 243468594Total Equity 306150187 281343744LIABILITIESNon-Current Liabilitiesa) Provisions 10 1399224 1270990b) Deferred Tax Liabilities (Net) 11 10745247 11364002Total Non-Current Liabilities 12144471 12634992Current Liabilitiesa) Financial Liabilities
(i) Trade Payablesa) Total outstanding dues of micro enterprises and
small enterprises ndash ndashb) Total outstanding dues of creditors other than
micro enterprises and small enterprises 483074 395920(ii) Other Financial Liabilities 12 9272344 11118126
b) Other Current Liabilities 13 1264039 1172866c) Provisions 10 74301 43165Total Current Liabilities 11093758 12730077Total Equity And Liabilities 329388416 306708813
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
41
STATEMENT OF PROFIT AND LOSS
For the year ended 31st March 2019Amount in `
I Revenue From Operations 14 36986948 33098499
II Other Income 15 19625544 17119109
III Total Income (I+II) 56612492 50217608
IV EXPENSES
Employee Benefits Expense 16 1208580 1094609
Depreciation and Amortization Expense 473636 475984
Other Expenses 17 3107913 3334087
Total Expenses (IV) 4790129 4904680
V Profit Before Tax (III- IV) 51822363 45312928
VI Tax Expense
Current Tax 18 11653499 9272310
Deferred Tax 18 (618755) 2350502
VII Profit for the Year (V-VI) 40787619 33690116
VIII Other Comprehensive Income ndash ndash
IX Total Comprehensive Income for the Year (VII+VIII) 40787619 33690116
X Earnings per Equity Share (Face Value ` 10-each) 19
Basic (in `) 1077 890
Diluted (in `) 1077 890
For the Year For the YearParticulars Note ended ended
31st March 2019 31st March 2018
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
42
For the year ended 31st March 2019
STATEMENT OF CHANGES IN EQUITY
The Board of Directors of the Company recommended a dividend of ` 35 per share (for the year ended 31st March 2018 - dividend ` 350 pershare) be paid on fully paid equity shares This equity dividend is subject to approval by shareholders at the Annual General MeetingThe totalequity dividend to be paid ` 13256303 (for the year ended 31st March 2018 - dividend ` 13256303) Income tax on proposed dividend being` 2724873 (for the year ended 31st March 2018 - ` 2724873)
General Reserve This Reserve is created by an appropriation from one component of equity (generally retained earnings) to another notbeing an item of Other Comprehensive Income The same can be utilized by the Company in accordance with the provisions of the CompaniesAct 2013
Retained Earnings This Reserve represents the cumulative profits of the Company This Reserve can be utilized in accordance with theprovisions of the Companies Act 2013
The accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even dateOn behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
A Equity Share CapitalAmount in `
Balance as at the Changes in equity Balance at thebeginning of the share capital end of the
reporting year during the year reporting yearFor the year ended 31st March 2018 37875150 ndash 37875150For the year ended 31st March 2019 37875150 ndash 37875150
B Other EquityAmount in `
Reserves amp Surplus TotalGeneral Reserve Retained Earnings
Balance as at April 01 2017 30257504 195873461 226130965Total Comprehensive Income for the year ndash 33690116 33690116Dividend ndash 13256303 13256303Income Tax on Dividend Paid ndash 2698671 2698671Dividend Distribution Tax (earlier year) ndash 397513 397513Balance as at March 31 2018 30257504 213211090 243468594Balance as at April 01 2018 30257504 213211090 243468594Total Comprehensive Income for the year ndash 40787619 40787619Dividend ndash 13256303 13256303Income Tax on Dividend Paid 2724873 2724873Balance as at March 31 2019 30257504 238017533 268275037
43
CASH FLOW STATEMENT
For the year ended 31st March 2019
For the Year For the YearParticulars ended ended
31st March 2019 31st March 2018
NOTES1) The above Cash Flow Statement has been prepared under the ldquoIndirect Methodrdquo as set out in Ind AS 7Statement of Cash FlowsrdquoThe accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even date On behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
Amount in `
A Cash Flow from Operating ActivitiesPROFIT BEFORE TAX 51822363 45312928Adjustments for
Depreciation amp Amortisation expense 473636 475984Interest Income (1317822) (3453950)Dividend Income (159984) (178075)Loss on sale of property plant and equipment - Net 445778 (28273)Net gain(loss) on investments mandatorily measuredat fair value through profit or loss (18005340) (13358789)Other Non Operating Income ndash (86856)Other Non Operating Expense ndash 99378
OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 33258631 28782347Adjustments for
Trade Receivables Financial Assets and Other Assets (2815198) (90661)Trade Payables Other Liabilities and Provisions (1568800) 1700052
CASH GENERATED FROM OPERATIONS 28874633 30391738Income Tax Paid(Net) (10407981) (12740273)
NET CASH FROM OPERATING ACTIVITIES 18466652 17651465B Cash Flow from Investing Activities
Sale of Property Plant and Equipment 8661 58452Purchase of Current Investments (224340000) (186220000)SaleRedemption of Current Investments 170532754 183295529Dividend Income 159984 178075Interest Received 3262318 4031382
NET CASH FROM INVESTING ACTIVITIES (50376283) 1343438C Cash Flow from Financing Activities
Dividend Paid (13256303) (13256303)Income Tax on Dividend Paid (2724873) (2698671)
NET CASH FROM FINANCING ACTIVITIES (15981176) (15954974)NET INCREASE IN CASH AND CASH EQUIVALENTS (47890807) 3039929OPENING CASH AND CASH EQUIVALENTS 48653846 45613917CLOSING CASH AND CASH EQUIVALENTS 763039 48653846
CASH AND CASH EQUIVALENTS COMPRISE Cash cheques and current accounts 763039 900355Other Bank BalancesDeposits with original maturity more than 3 months having remainingmaturity less than 12 months from Balance Sheet date ndash 47753491
763039 48653846
44
1 SIGNIFICANT ACCOUNTING POLICIESStatement of ComplianceThese financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) notifiedunder section 133 of the Companies Act 2013 (the Act) read with Companies (Indian Accounting Standards)Rules 2015 (as amended) The financial statements have also been prepared in accordance with the relevantpresentation requirements of the Companies Act 2013
Basis of PreparationThe financial statements are prepared in accordance with the historical cost convention except for certain itemsthat are measured at fair values as explained in the accounting policies below The financial statements arepresented in Indian Rupees (INR) which is also the Companyrsquos functional currency
Fair Value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transactionbetween market participants at the measurement date regardless of whether that price is directly observable orestimated using another valuation technique In estimating the fair value of an asset or a liability the Companytakes into account the characteristics of the asset or liability if market participants would take those characteristicsinto account when pricing the asset or liability at the measurement date
The preparation of financial statements in conformity with Ind AS requires management to make judgementsestimates and assumptions that affect the application of the accounting policies and the reported amounts ofassets and liabilities the disclosure of contingent assets and liabilities at the date of the financial statementsand the reported amounts of revenues and expenses during the year Actual results could differ from those estimatesThe estimates and underlying assumptions are reviewed on an ongoing basis Revisions to accounting estimatesare recognised in the period in which the estimate is revised if the revision affects only that period they arerecognised in the period of the revision and future periods if the revision affects both current and future periods
All assets and liabilities have been classified as current or non-current as per the Companyrsquos normal operatingcycle and other criteria set out in the Schedule III to the Companies Act 2013 and Ind AS 1 ndash Presentation ofFinancial Statements based on the nature of business and the time between the acquisition of assets for processingand their realisation in cash and cash equivalents
Property Plant amp Equipment ndash Tangible AssetsProperty plant amp equipment are stated at cost of acquisition or construction less accumulated depreciation andimpairment if any For this purpose cost includes deemed cost which represents the carrying value of propertyplant and equipment recognised as at 1st April 2015 measured as per the previous GAAP
Cost is inclusive of inward freight duties and taxes and incidental expenses related to acquisition In respect ofmajor projects involving construction related pre-operational expenses form part of the value of assets capitalisedExpenses capitalised also include applicable borrowing costs for qualifying assets if any Subsequent costs areincluded in the assetrsquos carrying amount only when it meets the recognition criteria are met as per componentaccounting The carrying amount of a replaced part is derecognized All other repairs and maintenance are chargedto the statement of Profit amp Loss
An item of property plant and equipment is derecognized upon disposal or when no future economic benefits areexpected to arise from the continued use of asset Any gain or loss arising on the disposal or retirement of an itemof property plant and equipment is determined as the difference between the sales proceeds and the carryingamount of the asset and is recognised in Statement of Profit and Loss
Depreciation of these assets commences when the assets are ready for their intended use which is generally oncommissioning Items of Property Plant and Equipment are depreciated in a manner that depreciates the cost ofthe assets after commissioning (or other amount substituted for cost) less its residual value over their usefullives as specified in Schedule II of the Companies Act 2013 on a straight line basis
Property plant and equipmentrsquosrsquo residual values and useful lives are reviewed at each balance sheet date andchanges if any are treated as changes in accounting estimate
NOTES TO THE FINANCIAL STATEMENTS
45
NOTES TO THE FINANCIAL STATEMENTS
Useful lives of different class of PPE are as follows
Particulars Useful Life as per Schedule IIBuilding 60 Years
Plant and Equipment 15 Years
Furnitures and fixtures 8 years
Office equipment 5 Years
Impairment of AssetsImpairment loss is provided if any to the extent the carrying amount of assets or cash generating units exceedtheir recoverable amount
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amountmay not be recoverable
Recoverable amount is higher of an assetrsquos net selling price and its value in use Value in use is the present valueof estimated future cash flows expected to arise from the continuing use of an asset or cash generating unit andfrom its disposal at the end of its useful life
Impairment losses recognised in prior years are reversed when there is an indication that the impairment lossesrecognised no longer exist or have decreased Such reversals are recognised as an increase in carrying amountsof assets to the extent that it does not exceed the carrying amounts that would have been determined (net ofamortisation or depreciation) had no impairment loss been recognised in previous years
Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodiedin the asset are considered to modify the amortisation period or method as appropriate and are treated aschanges in accounting estimates
Financial instruments Financial Assets and Financial LiabilitiesFinancial assets and financial liabilities are recognized when the Company becomes a party to the contractualprovisions of the relevant instrument Transaction cost that are directly attributable to the acquisition or issue offinancial assets and financial liabilities (other than financial assets and financial liabilities measured at fair valuethrough profit or loss) are added to or deducted from the fair value on initial recognition of financial assets andfinancial liabilities Purchase or sale of financial assets that require delivery of assets within a time frame establishedby regulation or convention in the market place (regular way trades) are recognized on the trade date ie the datewhen the Company commits to purchase or sell the asset
Financial AssetsRecognition Financial assets includes Investments Trade receivable Advances Security Deposits Cash andcash equivalents Such Assets are initially recognized at transaction price when the company becomes party tocontractual obligations The transaction price includes transaction cost unless the assets is being fair valuedthrough the Statement of Profit and Loss
Classification Management determines the classification of an asset at initial recognition depending on thepurpose for which the assets were acquired The subsequent measurement of financial assets depends on suchclassification
Financial assets are classified as those measured at
(a) Amortised cost where the financial assets are held solely for collection of cash flows arising from payments ofprincipal and or interest
(b) Fair value through other comprehensive income (FVTOCI) where the financial assets are held not only forcollection of cash flows arising from payments of principal and interest but also from the sale of such assetsSuch assets are subsequently measured at fair value with unrealised gains and losses arising from changesin the fair value being recognised in other comprehensive income
46
NOTES TO THE FINANCIAL STATEMENTS
(c) Fair value through profit or loss (FVTPL) where the assets are managed in accordance with an approvedinvestment strategy that triggers purchase and sale decision based on fair value of such assets Such assetsare subsequently measured at fair value with unrealized gain and losses arising from changes in the fair valuebeing recognised in the Statement of Profit and Loss in the period in which they arise
Trade receivable Advances Security Deposits Cash and Cash equivalents etc are classified for measurementat amortised cost while Investment have been classified for measurement at Fair value through profit or loss(FVTPL)
Impairment The Company assesses at each reporting date whether a financial asset (or group of financialassets) such as investment trade receivable advances and security deposit held at amortised cost are tested forimpairment based on evidence or information that is available without undue cost or effort Expected credit lossesare assessed and loss allowances recognized if the credit quality of the financial asset has deteriorated significantlysince initial recognition
Reclassification When and only when the business model is changed the Company shall reclassify all affectedfinancial assets prospectively from the reclassification date as subsequently measured at amortised cost fairvalue through profit or loss without restating the previously recognized gains or losses and in terms of thereclassification principles laid down in the Ind AS relating to Financial Instruments
De-recognition Financial assets are derecognized when the rights to receive benefits have expired or beentransferred and the Company has transferred substantially all risks and rewards of ownership of such financialasset
Financial LiabilitiesTrade payables and other financial liabilities are initially recognized at the value of the respective contractualobligations They are subsequently measured at amortised cost
Financial liabilities are derecognized when the liability is extinguished that is when the contractual obligation isdischarged cancelled or expires
Offsetting Financial InstrumentsFinancial assets and liabilities are offset and the net amount is included in the Balance Sheet where there is alegally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis orrealise the asset and settle the liability simultaneously
Revenue1 Revenue is measured at the fair value of the consideration received or receivable for services rendered net of
discounts to customers and excludes taxes such as Goods and Services Tax Revenue from the sale ofservices is recognised when the Company performs its obligations to its customers and the amount of revenuecan be measured reliably and recovery of the consideration is probable Income from operating license fees arerecognized on accrual basis in accordance with Operating License agreement The timing of such revenuerecognition is in the periods in which such services are rendered
2 Interest Income is booked in the Statement of Profit and Loss using the effective interest method
3 Dividend Income is recognised in the Statement of Profit and Loss when the right to receive dividend is established
Employee BenefitsThe Company makes contributions to both defined benefit and defined contribution schemes
Contributions to Provident Fund are in the nature of defined contribution scheme and such paidpayable amountsare charged against revenue The contributions in respect of provident fund and family pension are statutorilydeposited with the Government
The Company also makes contribution to defined benefit gratuity plan The cost of providing benefits under thedefined benefit obligation is calculated by independent actuary using the projected unit credit method The Companyhas taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liability with respect to the
47
NOTES TO THE FINANCIAL STATEMENTS
employees and the premium paid to LIC is charged to Statement of Profit amp Loss The difference between theactuarial valuation of the gratuity with respect to employees at the year-end and the contribution paid to LIC isfurther adjusted in the books of accounts
Employees Benefit wrt Leave Encashment is considered as Employees Long Term Benefit for which the Companyrecords the liability based on actuarial valuation computed under projected unit credit method These benefits areunfunded
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee as per the Operating LicenseAgreement
Taxes on IncomeTaxes on income comprises of current tax and deferred tax Current tax in the Statement of Profit and Loss isprovided as the amount of tax payable in respect of taxable income for the period using tax rates and tax lawsenacted during the period together with any adjustment to tax payable in respect of previous years
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities andthe amounts used for taxation purposes (tax base) at the tax rates and tax laws enacted or substantively enactedby the end of the reporting period
Deferred tax assets are recognized for the future tax consequences to the extent it is probable that future taxableprofits will be available against which the deductible temporary differences can be utilized
Deferred tax assets and liabilities are offset when there is legally enforceable right to offset current tax assets andliabilities and when the deferred tax balances relate to the same taxation authority Current tax assets and taxliabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on netbasis or to realize the asset and settle the liability simultaneously
Dividend DistributionDividends paid (including income tax thereon) is recognised in the financial statements in the period in which inwhich the interim dividends are approved by the Board of Directors or in respect of the Companyrsquos final dividendfor the year when the same are approved by shareholders of the Company
Provisions and Contingent LiabilitiesProvisions are recognized when the Company has a present obligation (legal or constructive) as a result of a pastevent it is probable that an outflow of resources will be required to settle the obligation and the amount can bereliably estimated The amount so recognized is the best estimate of the consideration required to settle theobligation at the reporting date taking in to account the risks and uncertainties surrounding the obligation Adisclosure for a contingent liability is made when there is possible obligation or a present obligation that may butprobably will not require an outflow of resources Where there is possible obligation or a present obligation inrespect of which the likelihood of outflow of resources is remote no provision or disclosure is made
Use of Estimates and JudgementsThe key estimates and assumption used in the preparation of financial statements are set out below
Actuarial ValuationThe determination of Companyrsquos liability towards defined benefit obligation to employees is made through independentactuarial valuation including determination of amounts to be recognized in the Statement of Profit and Loss and inother comprehensive income Such valuation depend upon assumptions determined after taking into accountinflation seniority promotion and other relevant factors such as supply and demand factors in the employmentmarket Information about such valuation is provided in notes to the financial statements
ComparativesWhen required by Ind AS comparative figures have been adjusted to conform to changes in presentation for thecurrent financial year
48
2P
rope
rty
Pla
nt a
nd E
quip
men
tA
mou
nt i
n `
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
Gros
s Bl
ock
Depr
eciat
on
Amor
tisati
onNe
t Blo
ck
Parti
cula
rsWi
thdraw
alWi
thdraw
alWi
thdraw
alWi
thdraw
alAp
ril 1
and
Marc
h 31
an
dMa
rch
31
April
1Fo
r the
and
March
31
For t
hean
dMa
rch
31
Marc
h 31
Ma
rch
31
2017
Addi
tions
Adjus
tmen
t20
18Ad
ditio
nsAd
justm
ent
2019
2017
year
Adjus
tmen
t20
18ye
arAd
justm
ent
2019
2019
2018
Tang
ible
Ass
ets
Build
ing
161
88
565
-16
188
565
-2
668
831
592
168
29
561
564
759
84-1
432
140
473
636
290
5518
76
721
140
44
961
147
56
425
Plan
t and
Equ
ipmen
t7
637
0120
716
742
985
-2
047
935
381
92-
--
--
--
538
192
742
985
Furn
iture
and
Fixt
ures
1
278
845
584
122
300
-11
818
110
482
--
--
--
-1
104
821
223
00
Offic
e Eq
uipme
nt2
017
-2
017
--
201
7-
--
--
--
201
72
017
Tota
l1
708
216
7-
263
001
705
586
7-
483
494
165
72
373
956
156
475
984
-14
321
404
736
3629
055
187
672
11
469
565
21
562
372
7
Full
y de
prec
iated
ass
ets
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
49
NOTES TO THE FINANCIAL STATEMENTS
Amount in `Particulars As at 31st March 2019 As at 31st March 2018
Current Non-Current Current Non-Current3 OTHER ASSETS
Advances other than capital advancesSecurity Deposit- With Others 2328947 2328947- Statutory Authorities 200000Other Advances (prepaid expenses) 437564 ndash 406324 ndashAdvance Tax (Net of Provisions) 4143487 5280504TOTAL 437564 6672434 406324 7609451
4 Current investments (at fair value through profit or loss unless otherwise stated) Amount in `Sl Investments in Mutual Funds As at 31st March 2019 As at 31st March 2018No
Name of Plan Unquoted Unquoted1 DHFL Pramerica Ultra Short Term Fund Nil (2018 - 1040731248)
Units of ` 1000 each ndash 219455882 ICICI Prudential Banking amp PSU Debt Fund 1124750948 Units
(2018 - 1124750948) of ` 1000 each 23872614 224702743 ICICI Prudential Corporate Bond Fund 1241451718 Units
(2018 - 1241451718) of ` 1000 each 23712100 221226704 UTI Floating Rate Fund Short Term Fund 7749911 Units
(2018-7749911) of ` 100000 each 23474167 218899535 SBI Magnum Instacash Nil Units (2018-3177849) of ` 100000 each ndash 70220186 Aditya Birla Sun Life Floating Rate Fund-Long Term 274475933 Units
(2018-319824542) Units of ` 10000 each 63614941 686675207 Aditya Birla Sunlife Saving Fund 137924934 Units (2018-129174683)
Units of ` 10000 each 51171946 443649348 Kotak Savings Fund 1128273230 Units (2018-Nil) of ` 1000 each 33816154 ndash9 Reliance Liquid Fund 11416769 Units (2018- Nil) of ` 100000 each 51823115 ndash10 ICICI Prudential Liquid Fund 57413509 Units (2018- Nil) of ` 10000 each 8809857 ndash
Aggregate amount of unquoted Investments 280294894 208482957TOTAL 280294894 208482957
Amount in `As at As at
31st March 2019 31st March 20185 TRADE RECEIVABLES
Unsecured Considered Good 16310661 14154244TOTAL 16310661 14154244
6 CASH AND CASH EQUIVALENTS Balances with Banks
Current Accounts 760024 900355Cash on Hand 3015 ndashTOTAL 763039 900355 Cash and cash equivalents include cash on hand cheques drafts on hand cash at bank and deposits with banks with original maturityof 3 months or less
7 OTHER BANKS BALANCESEarmarked balances 5489856 5429140On Deposit Accounts ndash 47753491TOTAL 5489856 53182631
Represents deposits with original maturity of more than 3 months having remaining maturity of less than 12 months from the Balance Sheet date
50
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
8 OTHER FINANCIAL ASSETSInterest accrued on Deposits 158000 2210348Others - Unsecured considered good 4566316 4138776TOTAL 4724316 6349124
As at As at As at As at31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of ` (No of `
Shares) Shares)9 EQUITY SHARE CAPITAL
AuthorisedEquity Shares of ` 10- each 10000000 100000000 10000000 100000000Issued Subscribed and Paid upEquity Shares of ` 10- each fully paid 3787515 37875150 3787515 37875150
A) Reconciliation of the number of Equity Shares outstanding31st March 31st March
2019 2018As at the beginning of the year 3787515 3787515Add - Shares issued during the year ndash ndashLess -Shares bought back during the year ndash ndashAs at the end of the year 3787515 3787515
B) Shareholders holding more than 5 of the As at As at As at As atEquity Shares in the Company 31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of (No of
Shares) Shares)ITC Limited 1733907 4578 1733907 4578Russell Investments Limited 300056 792 300056 792
C) Rights Preferences and Restrictions attached to the Equity SharesThe Equity Shares of the Company having par value of ` 10 per share rank pari passu in all respects includingvoting rights and entitlement to dividend
D) There are no bonus issue or buy back of equity shares during the period of five years immediately preceding thereporting date
As at 31st March 2019 As at 31st March 2018Current Non-Current Current Non-Current
10 PROVISIONSProvision for Long Term Employee Benefits 74301 1399224 43165 1270990TOTAL 74301 1399224 43165 1270990
51
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
11 DEFERRED TAX LIABILITIES (NET)Deferred Tax Liabilities 10745247 11364002Total 10745247 11364002Movement in Deferred Tax LiabilitiesAssets Balances
For the year 2018-19 Balance as on Recognized in Balance as on1st April 2018 profit or loss 31st March 2019
Deferred Tax Liabilities in relation toOther timing differences
On Depreciation on PPE 4293876 (252926) 4040950On Gain on Investment at FVTPL 7070126 473819 7543945
Total Deferred Tax Liabilities 11364002 220893 11584895Deferred tax liabilities beforeMAT credit entitlement 11364002 220893 11584895Less MAT credit entitlement ndash 839648 839648Total Deferred Tax Liabilities (Net) 11364002 (618755) 10745247
For the year 2017-18 Balance as on Recognized in Balance as on1st April 2017 profit or loss 31st March 2018
Deferred Tax liabilitiesassets in relation toOther timing differences
On Depreciation on PPE 4383618 (89742) 4293876On Gain on Investment at FVTPL 4629882 2440244 7070126
Total Deferred Tax Liabilities (Net) 9013500 2350502 11364002
As at As at31st March 2019 31st March 2018
12 OTHER FINANCIAL LIABILITIES
Unpaid Dividend 5489856 5429140Employee Related 3782488 5688986TOTAL 9272344 11118126
13 OTHER CURRENT LIABILITIES
Statutory Liabilities 1264039 1172866TOTAL 1264039 1172866
52
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 201814 REVENUE FROM OPERATIONS
Operating License Fees 36986948 33098499TOTAL 36986948 33098499
15 OTHER INCOMEInterest Income- Deposit with Banks- Carried At Amortised Cost 1178600 3272160- Deposit Others 139222 181790Dividend Income on Investment measured at FVTPL 159984 178075Net Gain(Loss) on financial assets mandatorily measured at FVTPL 18005340 13358789Net Gain(Loss) on Disposal of Fixed Assets ndash 28273Other Non-Operating Income 142398 100022TOTAL 19625544 17119109
Includes 1120976- (2018 - 681882-) being net gain(loss) on sale of investments
16 EMPLOYEE BENEFITS EXPENSESalaries and Wages 42461991 38590070Contribution to Provident and Other Fund 4564892 3983444
47026883 42573514Less Recoveries madeReimbursements received (45818303) (41478905)TOTAL 1208580 1094609
17 OTHER EXPENSESAdvertising Sales Promotion 159768 158814Consultancy Professional fees 214842 253969Travelling amp Conveyance 810746 1096527Postage Telephone Stationery etc 366042 205049Miscellaneous Expenses 1556515 1619728TOTAL 3107913 3334087Miscellaneous expenses includes Auditors remuneration andexpenses Audit Fees 60000 60000Fees for other services 40000 ndash
18 INCOME TAX EXPENSESA Amount recognised in profit or loss
Current TaxIncome Tax for the Year 11504441 9481109Adjustments(Credits) related to previous year 149058 (208799)Total Current Tax 11653499 9272310Deferred TaxDeferred tax for the year 220893 2350502Mat Credit Entitlement (839648) ndashTotal Deferred Tax (618755) 2350502TOTAL 11034744 11622812
NOTES TO THE FINANCIAL STATEMENTSAmount in `
53
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 2018B Reconciliation of effective tax rate
Profit before tax 51822363 45312928Indian tax rate 2782 2755Income Tax expense calculated at 2782 (2018 2755) 14416981 12484845Effects ofndash Different tax rate on certain items (2922098) (756048)ndash Difference in taxable incomedeductible expense 9697 42609ndash Incomes that are not taxable in determining taxable profit (44508) (49064)Adjustments recognised in the current year in relation toCurrent tax of prior years (425328) (208799)Effect on deferred tax balances due to the change in income tax rate ndash 109269Income Tax recognised in profit or loss 11034744 11622812
The tax rate used for the year 2018-19 and 2017-18 reconciliations above is the corporate tax rate of 25 + surcharge 7 and education cess 4 (2017-18 3) payable on taxable profits under the Income Tax Act 1961
19 EARNINGS PER EQUITY SHAREProfit for the year 40787619 33690116Number of equity shares outstanding 3787515 3787515Basic and diluted earnings per share in (Face value ` 10- per share) 1077 890
20 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTSA The Company was allotted 8200 sq mtrs of land at Vadodara in 1984 and an additional land of 2548 sq mtrs
in 1988 at R C Dutt Road Alkapuri Vadodara through GIIC (Gujarat Industrial Investment Corporation) on sub-lease for a period 30 years on which the hotel Welcomhotel Vadodara was constructed Lease term of landadmeasuring 8200 Sq mtrs expired on 30092014 and of land admeasuring 2548 sq mtrs expired on 30112018
The High Court of Gujarat in pursuance of Writ petition filed by Company in April 2013 passed an Order onDecember 24 2014 restraining the State Government from disturbing the peaceful and actual possession ofthe Company over the hotel property in any manner The writ petition is pending for hearing
The Company have made necessary application to State Government for Conversion of land from Leasehold toFreehold or Extension of Lease which is in process
B There are no Micro Small and Medium Enterprises to whom the Company owes dues which are outstandingfor more than 45 days during the year and also as at 31st March 2019 This information as required to bedisclosed under the Micro Small and Medium Enterprises Development Act 2006 has been determined tothe extent such parties have been identified on the basis of information available with the Company
C The Company operates in one segment ie Hoteliering and within one geographical segment ie India
D Defined Benefit Plan
The Company has taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liabilitywith respect to the employees and the premium paid to LIC is charged to Statement of Profit amp Loss Thedifference between the actuarial valuation of the gratuity with respect to employees at the year-end and thecontribution paid to LIC is further adjusted in the books of accounts
The accounting charge for benefits under the defined benefit obligation is calculated by independent actuaryusing the projected unit credit method
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee (ITC Limited) as per theOperating License Agreement hence no effect on Statement of Profit amp Loss and Other Comprehensive
54
NOTES TO THE FINANCIAL STATEMENTS
Income
Risk ManagementThe defined Benefit Plan expose the company to risk of actuarial deficit arising out of investment risk interestrate risk and salary cost inflation riskInvestment Risks This may arise from volatility in asset values due to market fluctuations and impairment ofassets due to credit losses These Plans primarily invest in debt instruments such as Government securitiesand highly rated corporate bonds ndash the valuation of which is inversely proportional to the interest rate movementsInterest Rate Risk The present value of Defined Benefit Plans liability is determined using the discount ratebased on the market yields prevailing at the end of reporting period on Government bonds A decrease inyields will increase the fund liabilities and vice-versaSalary Cost Inflation Risk The present value of the Defined Benefit Plan liability is calculated with referenceto the future salaries of participants under the Plan Increase in salary due to adverse inflationary pressuresmight lead to higher liabilitiesThese Plans have a relatively balanced mix of investments in order to manage the above risks The investmentstrategy is designed based on the interest rate scenario liquidity needs of the Plans and pattern of investmentas prescribed under various statutes
(Amount in `) Particulars Gratuity 2018-19 2017-18
I Components of Defined Benefit Cost 31-03-2019 31-03-2018 Recognised in Profit or Loss a Current Service Cost 641829 519816 b Past Service Cost ndash
c Net Interest Cost (184109) (72060) Remeasurements a Effect of changes in demographic assumptions (2108) ndash b Effect of changes in financial assumptions ndash (546692) c Effect of experience adjustments (142950) (700483) d (Return) on plan assets (excluding interest income) 24103 110903 e Changes in asset ceiling (excluding interest income) ndash ndash f Total remeasurements included in OCI (169160) (1358078)
Total defined benefit cost recognized in PampL 288560 (910323)I I Net Assets (Liabilities) recognised in Balance Sheet 31-03-2019 31-03-2018
1 Defined Benefit Obligation at end of period 11112243 102978642 Fair value of plan assets at end of period 13058222 120087733 Net defined benefit liability (asset) (1945979) (1710909)
III Change in Defined Benefit Obligation 31-03-2019 31-03-20181 Defined benefit obligation at beginning of period 10297864 111006822 Current service cost 641829 5198163 Interest expenses 755904 7223694 Remeasurements gains (losses)
a Effect of changes in demographic assumptions (2108) ndashb Effect of changes in financial assumptions ndash (546692)c Effect of experience adjustments (142950) (700483)
5 Benefits Paid (438296) (797828)6 Present Value of DBO at end of the year 11112243 10297864
IV Change in Fair Value of Plan Assets 31-03-2019 31-03-20181 Fair value of plan assets at beginning of period 12008773 11529880
55
NOTES TO THE FINANCIAL STATEMENTS
2 Interest income 940012 7944303 Actual Company Contributions 523630 3713884 Benefits Paid (438296) (797828)5 Remeasurements Gains(Losses) on plan assets 24103 1109036 Fair Value of Plan Assets at end of period 13058222 12008773
V Significant Actuarial Assumptions 31-03-2019 31-03-20181 Discount rate () 750 7502 Salary increase rate 70 703 Attrition Rate 20 204 Retirement Age 58 585 Pre-retirement Mortality Indian Assured Indian Assured
Lives Mortality Lives Mortality(2012-14) Ultimate (2006-08) Ultimate
6 Disability Nil NilVI Sensitivity Analysis
The below sensitivity analysis are based on a change in an assumption while holding all other assumptionsconstant In practice this is unlikely to occur and changes in some of the assumptions may be correlatedWhen calculating the sensitivity of the defined benefit obligation to significant actuarial assumptionsthe same method (present value of the defined benefit obligation calculated with the projected unit creditmethod at the end of the reporting period) has been applied as when calculating the defined benefitliability recognised in the balance sheet The methods and types of assumptions used in preparing thesensitivity analysis did not change compared to the prior period
DBO as at DBO as at31-03-2019 31-03-2018
1 Discount rate +100 basis points 10484869 96707062 Discount rate -100 basis points 11804923 109908143 Salary Increase Rate +1 11746789 109364544 Salary Increase Rate -1 10525722 97077345 Attrition Rate +1 11127835 103179616 Attrition Rate -1 11095064 10276102
Maturity Analysis of the Benefit Payments 31-03-2019 31-03-2018 Year 1 804294 399061 Year 2 1117591 769443 Year 3 558914 1211853 Year 4 2204073 512504 Year 5 1303903 2056016 Next 5 years 4323660 4603103
E Amount towards Defined Contribution Plans have been recognized under Contribution to Provident and OtherFunds in Note 16 ` 4564892- (2018 - ` 3983444-)
F The financial statements were approved for issue by the Board of Directors on 15th April 2019G Company has adopted IND As 115 lsquoRevenue from Contracts with Customersrsquo wef 01st April 2018 on prospective
basis and there is no material impact on Financial StatementsH Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Second
Amendment Rules 2019 on 30th March 2019 notifying new Standard Ind AS 116 lsquoLeasesrsquo and otherconsequential amendment in existing Ind As This Ind AS is applicable for annual period beginning on or after01st April 2019 The company is in the process of analysing the impact of such amendment which are notexpected to be material
56
NOTES TO THE FINANCIAL STATEMENTS
21 Financial Instruments and Related DisclosuresI Capital Management
The Company does not have borrowing and aims at maintaining a strong capital base so as to maintain adequatesupply of funds towards future growth plans as a going concern
II Categories of Financial InstrumentsAmount in `
Particulars Note As at As at March 31 2019 March 31 2018
Carrying Fair Carrying FairValue Value Value Value
A Financial Assetsa) Measured at Amortised Cost
i) Cash and cash equivalents 6 763039 763039 900355 900355ii) Other bank balances 7 5489856 5489856 53182631 53182631iii) Trade Receivables 5 16310661 16310661 14154244 14154244iv) Other Financial Assets 8 4724316 4724316 6349124 6349124
Sub - total 27287872 27287872 74586354 74586354 b) Measured at Fair Value through Profit or Loss
i) Investment in mutual funds 4 280294894 280294894 208482957 208482957Sub - total 280294894 280294894 208482957 208482957
Total Financial Assets 307582766 307582766 283069311 283069311B Financial Liabilities
Measured at Amortised Costi) Trade Payables 483074 483074 395920 395920ii) Other Financial Liabilities 12 9272344 9272344 11118126 11118126Total Financial Liabilities 9755418 9755418 11514046 11514046
The carrying amounts of trade payables other financial liabilities cash and cash equivalents other bank balancestrade receivables and other financial assets are considered to be the same as their fair values due to their short termnatureFair value in Mutual fund has been considered as Level 1 as Hierarchy for the same are based on unadjusted pricesin active marketIII Financial Risk Management Objectives
The Company has a system-based approach to risk management anchored to policies and procedures andinternal financial controls aimed at ensuring early identification evaluation and management of key financialrisks (such as market risk credit risk and liquidity risk) that may arise as a consequence of its businessoperations as well as its investing activities Accordingly the Companyrsquos risk management framework has theobjective of ensuring that such risks are managed within acceptable and approved risk parameters in a disciplinedand consistent manner and in compliance with applicable regulation It also seeks to drive accountability in thisregardLiquidity RiskThe company has current assets aggregate to ` 308020330- (2018- ` 283475635) including CurrentInvestments Cash and cash equivalents and Other bank balances of ` 286547789- (2018- ` 262565943-)against an aggregate Current liability of ` 11093758- (2018- ` 12730077-) on the reporting dateFurther whilethe Companyrsquos total equity stands at ` 306150187- (2018- ` 281343744-) and it has no borrowings In suchcircumstances liquidity risk or the risk that the company may not be able to settle or meet its obligations as theybecome due does not existMarket RiskThe company invests in mutual fund schemes of leading fund houses Such investments are susceptible tomarket price risk that arise mainly from changes in interest rate which may impact the return and value of such
57
NOTES TO THE FINANCIAL STATEMENTS
investments However given the relatively short tenure of the underlying portfolio of the mutual fund schemes inwhich the company has invested such price risk is not significantCredit RiskCompanyrsquos deployment in financial instruments such as mutual funds and fixed deposit are made in high qualitypaperscounterparties The company has receivable balances with ITC Limited under the Operating ServiceAgreement which are generally short term in nature Accordingly the Company has concluded that no provisionfor expected credit loss is required
22 Related Party DisclosuresRelated Party Transactionsi) Name of related parties and nature of relationships
ITC Limited of which the Company is an Associateii) Key Management Personnel
Board of DirectorsN Anand Chairman amp Non-Executive DirectorJ Singh Non-Executive DirectorR C Mehta Non-Executive DirectorC K Koshy Non-Executive DirectorM Narayanan Non-Executive DirectorD R Choudhury Non-Executive Director
iii) Summary of transactions during the year Amount in `
Particulars ITC Limited Key ManagementPersonnel
2019 2018 2019 2018License Fees Received 43644599 38834172 ndash ndashPurchase of Services 364514 513635 ndash ndashRemuneration of Managers on Deputation Reimbursed 5916468 5236397 ndash ndashRecoveries of Contractual Remuneration(Including Mangers on Deputation) 53058539 51502148 ndash ndashExpenses Recovered 2168155 2400471 ndash ndashExpenses Reimbursed ndash 44604 ndash ndashDividend Payments 6068675 6068675 700 700Remuneration to Key Management Personnel- Directorrsquos Sitting Fees 370000 350000Balance amount recoverable 20865894 18292750 ndash ndashBalance amount payable ndash ndash ndash ndash
58
TO THE MEMBERS OFGUJARAT HOTELS LIMITED
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying financial statementsof Gujarat Hotels Limited (ldquothe Companyrdquo) which comprisethe Balance Sheet as at 31st March 2019 the Statement ofProfit and Loss including other comprehensive incomeStatement of Changes in Equity and Statement of CashFlows for the year then ended and notes to the financialstatements including a summary of significant accountingpolicies and other explanatory information (hereinafterreferred to as ldquothe financial statementsrdquo)
In our opinion and to the best of our information andaccording to the explanations given to us the aforesaidfinancial statements give the information required by theCompanies Act 2013 (ldquothe Actrdquo) in the manner so requiredand give a true and fair view in conformity with the IndianAccounting Standards specified under section 133 of theAct read with the Companies (Indian Accounting Standards)Rules 2015 as amended (lsquoInd ASrdquo) and other accountingprinciples generally accepted in India of the state of affairsof the Company as at 31 st March 2019 and totalcomprehensive income (comprising of profit and othercomprehensive income) changes in equity and its cashflows for the year ended on that date
Basis for Opinion
We conducted our audit of the financial statements inaccordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act Our responsibilities underthose Standards are further described in the AuditorrsquosResponsibilities for the Audit of the Financial Statementssection of our report We are independent of the Companyin accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financialstatements under the provisions of the Act and the Rulesmade thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements andthe Code of Ethics We believe that the audit evidence wehave obtained is sufficient and appropriate to provide abasis for our audit opinion
Key Audit Matters
Key audit matters are those matters that in our professionaljudgment were of most significance in our audit of thesefinancial statements of the current period These matterswere addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereonand we do not provide a separate opinion on these mattersWe have determined the matters described below to bethe key audit matters to be communicated in our report
INDEPENDENT AUDITORS REPORT
Information Other than the Financial Statements andAuditorrsquos Report Thereon
The Companyrsquos Board of Directors is responsible forpreparation of the other information The other informationcomprises the information included in the Boardrsquos Reportincluding Annexures to Boardrsquos Report ManagementDiscussion and Analysis Report on Corporate Governance
and Shareholderrsquos Information but does not include thefinancial statements and our auditorrsquos report thereon
Our opinion on the financial statements does not cover theother information and we do not express any form ofassurance conclusion thereon
In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing
Sr No
Key Audit Matter How our audit addressed the matter
1 Evaluation of uncertain legal position of leasehold land
(Refer note no 20A to the financial statements)
The lease period of land held by the Company has expired The Company has filed necessary writ petition with High Court of Gujarat in April 2013 which is still pending for adjudication The Company has also made necessary application to State Government for Conversion of land from Leasehold to Freehold or Extension of Lease which is in process This matter being sub-judice essentially involves significant judgement to determine the possible outcome and therefore we have considered it as a key audit matter
We performed the following substantive procedures
Obtained details of application made to State Government Obtained details of writ petition filed to the High Court of
Gujarat and order copy passed by the High Court of Gujarat restraining the State Government from disturbing the actual possession over the property
Obtained details of progress in the matter Discussed the case with the Companyrsquos legal advisor about
the possible outcomes Read the minutes of the board meetings
Based on the procedures described managementrsquos evaluation on the same is acceptable
59
so consider whether the other information is materiallyinconsistent with the financial statements or our knowledgeobtained in the audit or otherwise appears to be materiallymisstated
If based on the work we have performed we conclude thatthere is a material misstatement of this other informationwe are required to report that fact We have nothing to reportin this regard
Responsibilities of Management and Those Charged withGovernance for the Financial Statements
The Companyrsquos Board of Directors is responsible for thematters stated in section 134(5) of the Act with respect tothe preparation of these financial statements that give atrue and fair view of the financial position financialperformance including other comprehensive incomechanges in equity and cash flows of the Company inaccordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards(Ind AS) prescribed under section 133 of the Act
This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company andfor preventing and detecting frauds and other irregularitiesselection and application of appropriate accounting policies making judgments and estimates that are reasonableand prudent and design implementation andmaintenance of adequate internal financial controls thatwere operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to thepreparation and presentation of the financial statementsthat give a true and fair view and are free from materialmisstatement whether due to fraud or error
In preparing the financial statements management isresponsible for assessing the Companyrsquos ability tocontinue as a going concern disclosing as applicablematters related to going concern and using the goingconcern basis of accounting unless management eitherintends to liquidate the Company or to cease operationsor has no realistic alternative but to do so
The Board of Directors is also responsible for overseeingthe Companyrsquos financial reporting process
Auditorrsquos Responsibilities for the Audit of the FinancialStatements
Our objectives are to obtain reasonable assurance aboutwhether the financial statements as a whole are free frommaterial misstatement whether due to fraud or error andto issue an auditorrsquos report that includes our opinionReasonable assurance is a high level of assurance but isnot a guarantee that an audit conducted in accordance withSAs will always detect a material misstatement when itexists Misstatements can arise from fraud or error and areconsidered material if individually or in the aggregate they
could reasonably be expected to influence the economicdecisions of users taken on the basis of these financialstatements
As part of an audit in accordance with SAs we exerciseprofessional judgment and maintain professionalskepticism throughout the audit We also
bull Identify and assess the risks of materialmisstatement of the financial statements whetherdue to fraud or error design and perform auditprocedures responsive to those risks and obtain auditevidence that is sufficient and appropriate to providea basis for our opinion The risk of not detecting amaterial misstatement resulting from fraud is higherthan for one resulting from error as fraud may involvecollusion forgery intentional omissionsmisrepresentations or the override of internal control
bull Obtain an understanding of internal control relevantto the audit in order to design audit procedures thatare appropriate in the circumstances Under section143(3)(i) of the Act we are also responsible forexpressing our opinion on whether the Company hasadequate internal financial controls system in placeand the operating effectiveness of such controls
bull Evaluate the appropriateness of accounting policiesused and the reasonableness of accountingestimates and related disclosures made bymanagement
bull Conclude on the appropriateness of managementrsquosuse of the going concern basis of accounting andbased on the audit evidence obtained whether amaterial uncertainty exists related to events orconditions that may cast significant doubt on theCompanyrsquos ability to continue as a going concern Ifwe conclude that a material uncertainty exists we arerequired to draw attention in our auditorrsquos report tothe related disclosures in the financial statementsor if such disclosures are inadequate to modify ouropinion Our conclusions are based on the auditevidence obtained up to the date of our auditorrsquosreport However future events or conditions maycause the Company to cease to continue as a goingconcern
bull Evaluate the overall presentation structure andcontent of the financial statements including thedisclosures and whether the financial statementsrepresent the underlying transactions and events ina manner that achieves fair presentation
We communicate with those charged with governanceregarding among other matters the planned scope andtiming of the audit and significant audit findings includingany significant deficiencies in internal control that weidentify during our audit
INDEPENDENT AUDITORS REPORT
60
We also provide those charged with governance with astatement that we have complied with relevant ethicalrequirements regarding independence and tocommunicate with them all relationships and other mattersthat may reasonably be thought to bear on ourindependence and where applicable related safeguards
From the matters communicated with those charged withgovernance we determine those matters that were of mostsignificance in the audit of the financial statements of thecurrent year and are therefore the key audit matters Wedescribe these matters in our auditorrsquos report unless lawor regulation precludes public disclosure about the mattersor when in extremely rare circumstances we determinethat a matters should not be communicated in our reportbecause the adverse consequences of doing so wouldreasonably be expected to outweigh the public interestbenefits of such communication
Report on Other Legal and Regulatory Requirements
1 As required by the Companies (Auditorrsquos Report)Order 2016 (ldquothe Orderrdquo) issued by the CentralGovernment of India in terms of sub-section (11) ofsection 143 of the Act we give in ldquoAnnexure Ardquo astatement on the matters specified in paragraphs 3and 4 of the Order to the extent applicable
2 As required by Section 143(3) of the Act we reportthat
a we have sought and obtained all the information andexplanations which to the best of our knowledge andbelief were necessary for the purposes of our audit
b in our opinion proper books of account as requiredby law have been kept by the Company so far as itappears from our examination of those books
c the Balance Sheet the Statement of Profit and lossincluding other comprehensive income the Statementof Changes in Equity and the Statement of Cash Flowsdealt with by this Report are in agreement with thebooks of account
d in our opinion the aforesaid financial statementscomply with the Indian Accounting Standards (Ind AS)prescribed under Section 133 of the Act
e on the basis of the written representations receivedfrom the directors as on 31st March 2019 taken onrecord by the Board of Directors none of the directorsis disqualified as on 31st March 2019 from beingappointed as a director in terms of Section 164(2) ofthe Act
f with respect to the adequacy of the internal financialcontrols with reference to financial statements of theCompany and the operating effectiveness of suchcontrols refer to our separate report in ldquoAnnexure Brdquoand
g with respect to the other matters to be included in theAuditorrsquos Report in accordance with the requirementsof section 197(16) of the Act as amended theCompany has neither paid nor provided for anyremuneration to its directors during the year
h with respect to the other matters to be included in theAuditorrsquos Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules 2014 in ouropinion and to the best of our information andaccording to the explanations given to us
i the Company does not have any pendinglitigations which would impact its financialposition
ii the Company did not have any long-termcontracts including derivative contracts for whichthere were any material foreseeable losses
iii there has been no delay in transferringamounts required to be transferred to theInvestor Education and Protection Fund by theCompany
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
61
ANNEXURE A TO THE INDEPENDENT AUDITORrsquoS REPORT
The annexure referred to in our Independent AuditorrsquosReport to the members of Gujarat Hotels Limited (ldquotheCompanyrdquo) on the financial statements for the year ended31st March 2019 we report that
i (a) The Company has maintained proper recordsshowing full particulars including quantitativedetails and situation of fixed assets
(b) As explained to us the Company has a regularprogram of physical verification of fixed assetswhich in our opinion is reasonable The assetswhich were to be covered as per the saidprogram have been physically verified by themanagement during the year In our opinion andAccording to the information and explanationsgiven to us no material discrepancies werenoticed on such verification
(c) According to the information and explanationsgiven to us and on the basis of our examinationof the records of the Company the title deeds ofimmovable properties are held in the name ofthe Company with respect to land the Companyhas filed a writ petition with Gujarat High Courtseeking that the Gujarat State Government bedirected to take action on Companyrsquosapplication to have the leasehold land of theHotel Converted to freehold and transferred toCompany as per the existing government policyin this regard
ii The Company does not have any inventory andtherefore reporting under clause (ii) of the Order isnot applicable to the Company
iii The Company has not granted any loans secured orunsecured to Companies firms Limited LiabilityPartnerships or other parties covered in the registermaintained under section 189 of the Companies Act2013 and therefore reporting under clause (iii) of theOrder is not applicable to the Company
iv The Company has not given any loans guaranteesor security In respect of the Investments made in ouropinion and according to the information andexplanations given to us the Company has compliedwith the provisions of section 186 of the Act
v According to the information and explanations givento us the Company has not accepted any depositsduring the year from the public within the meaning ofprovisions of section 73 to 76 of the Companies Act2013 and the rules framed thereunder and thereforereporting under clause (v) of the Order is notapplicable to the Company
vi In our opinion and according to the information andexplanations given to us in view of Rule 3 of theCompanies (Cost Records and Audit) AmendmentsRules 2014 the maintenance of cost records undersub-section (1) of section 148 of the Companies Act2013 is not applicable to the Company and thereforereporting under clause (vi) of the Order is notapplicable to the Company
vii (a) According to the information and explanationsgiven to us the Company has been regular indepositing with appropriate authoritiesundisputed statutory dues including providentfund employeersquos state insurance income-taxvalue added tax goods and service tax cessand other statutory dues applicable to it Furtherno undisputed amounts payable in respect ofprovident fund employeersquos state insuranceincome tax value added tax goods and servicetax cess and any other statutory dues were inarrears as at 31st March 2019 for a period ofmore than six months from the date theybecome payable
(b) According to the information and explanationsgiven to us there are no dues of Income taxsales tax value added tax and goods andservice tax which have not been deposited onaccount of any dispute
viii The Company has not taken any loans or borrowingsfrom financial institutions banks and government orhas not issued any debentures and thereforereporting under clause (viii) of the Order is notapplicable to the Company
ix The Company has not raised moneys by way of initialpublic offer or further public offer (including debtinstrument) and term loans during the year andtherefore reporting under clause (ix) of the Order isnot applicable to the Company
x To the best of our knowledge and according toinformation and explanations given to us no materialfraud by the Company or on the Company by its officersor employees has been noticed or reported duringthe course of our audit
xi In our opinion and according to the information andexplanations given to us the Company has not paidor provided any managerial remuneration during theyear and therefore reporting under clause (xi) of theOrder is not applicable to the Company
xii The Company is not a Nidhi company and thereforereporting under clause (xii) of the Order is notapplicable to the Company
INDEPENDENT AUDITORS REPORT
62
xiii In our opinion and according to the information andexplanations given to us and based on ourexamination of the records of the Company alltransactions with the related parties are in compliancewith Section 177 and 188 of the Act where applicableand the details have been disclosed in the financialstatements as required by the applicable accountingstandards
xiv According to the information and explanations givento us the Company has not made any preferentialallotment or private placement of shares or fully orpartly convertible debentures during the year underreview and therefore reporting under clause (xiv) ofthe Order is not applicable to the Company
xv In our opinion and according to the information andexplanations given to us the Company has not
entered into any non-cash transactions with directorsor persons connected with directors and thereforereporting under clause (xv) of the Order is notapplicable to the Company
xvi The Company is not required to be registered undersection 45-IA of the Reserve Bank of India Act 1934
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
63
ANNEXURE ldquoBrdquo TO THE INDEPENDENT AUDITORSrsquo REPORT
(Referred to in paragraph 2(f) under lsquoReport on Other Legaland Regulatory Requirementsrsquo section of our report to theMembers of Gujarat Hotels Limited on the financialstatements of even date)
Report on the Internal Financial Controls with referenceto financial statements under Clause (i) of Sub-section 3of Section 143 of the Act
W e have audited the internal financial controls withreference to financial statements of Gujarat Hotels Limited(ldquothe Companyrdquo) as of 31st March 2019 in conjunction withour audit of the financial statements of the Company for theyear ended on that date
Managementrsquos Responsibility for Internal FinancialControls
The Companyrsquos management is responsible forestablishing and maintaining internal financial controlsbased on the internal control over financial reporting criteriaestablished by the Company considering the essentialcomponents of internal control stated in the Guidance Noteon Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountantsof India (ldquoICAIrdquo) These responsibilities include the designimplementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuringthe orderly and efficient conduct of its business includingadherence to companyrsquos policies the safeguarding of itsassets the prevention and detection of frauds and errorsthe accuracy and completeness of the accounting recordsand the timely preparation of reliable financial informationas required under the Act
Auditorsrsquo Responsibility
Our responsibility is to express an opinion on theCompanyrsquos internal financial controls with reference tofinancial statements based on our audit We conductedour audit in accordance with the Guidance Note on Audit ofInternal Financial Controls over Financial Reporting (theldquoGuidance noterdquo) and the Standards on Auditing issued byICAI and deemed to be prescribed under section 143(10)of the Companies Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the ICAIThose Standards and the Guidance Note require that wecomply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whetheradequate internal financial controls with reference tofinancial statements were established and maintained andif such controls operated effectively in all material respects
Our audit involves performing procedures to obtain auditevidence about the adequacy of the internal financialcontrols with reference to financial statements and their
operating effectiveness Our audit of internal financialcontrols with reference to financial statements includedobtaining an understanding of internal financial controlswith reference to financial statements assessing the riskthat a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal controlbased on the assessed risk The procedures selecteddepend on the auditorrsquos judgement including theassessment of the risks of material misstatement of thefinancial statements whether due to fraud or error
We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our auditopinion on the Companyrsquos internal financial controls withreference to financial statements
Meaning of Internal Financial Controls with reference tofinancial statements
A Companyrsquos internal financial controls with reference tofinancial statements is a process designed to providereasonable assurance regarding the reliability of financialreporting and the preparation of financial statements forexternal purposes in accordance with generally acceptedaccounting principles A Companyrsquos internal financialcontrols with reference to financial statements includesthose policies and procedures that (1) pertain to themaintenance of records that in reasonable detailaccurately and fairly reflect the transactions anddispositions of the assets of the Company (2) providereasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements inaccordance with generally accepted accounting principlesand that receipts and expenditures of the Company arebeing made only in accordance with authorisations ofmanagement and directors of the Company and (3) providereasonable assurance regarding prevention or timelydetection of unauthorised acquisition use or dispositionof the Companyrsquos assets that could have a material effecton the financial statements
Inherent Limitations of Internal Financial Controls withreference to financial statements
Because of the inherent limitations of internal financialcontrols with reference to financial statements includingthe possibility of collusion or improper managementoverride of controls material misstatements due to erroror fraud may occur and not be detected Also projections ofany evaluation of the internal financial controls withreference to financial statements to future periods aresubject to the risk that the internal financial control withreference to financial statements may become inadequatebecause of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate
INDEPENDENT AUDITORS REPORT
64
Opinion
In our opinion the Company has in all material respectsan adequate internal financial controls with reference tofinancial statements and such internal financial controlswith reference to financial statements were operatingeffectively as at 31st March 2019 based on the internalcontrol over financial reporting criteria established by theCompany considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal
INDEPENDENT AUDITORS REPORT
Financial Controls over Financial Reporting issued by theInstitute of Chartered Accountants of India
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
3
NOTICE IS HEREBY GIVEN that the Thirty Seventh AnnualGeneral Meeting of the Members of Gujarat Hotels Limitedwill be held at the Registered Office of the Company atWelcomHotel Vadodara R C Dutt Road Alkapuri Vadodarandash 390 007 on Saturday the 7th day of September 2019 at1100 am for the transaction of the following businesses-
ORDINARY BUSINESS
1 To consider and adopt the Financial Statements of theCompany for the financial year ended 31st March2019 and the Reports of the Board of Directors andthe Auditors
2 To declare dividend for the financial year ended31st March 2019
3 To appoint a Director in place of Mr Jagdish Singh(DIN 00042258) who retires by rotation and beingeligible offers himself for re-election
4 To consider and if thought fit to pass the followingresolution as an Ordinary Resolution-
ldquoResolved that in accordance with the provisions ofSection 142 of the Companies Act 2013 payment ofremuneration of ` 60000- (Rupees Sixty Thousandonly) to Messrs K C Mehta amp Co CharteredAccountants (FRN 106237W) to conduct the audit forthe financial year 2019-20 plus goods and servicestax as applicable and reimbursement of out-of-pocketexpenses incurred be and is hereby approvedrdquo
SPECIAL BUSINESS
5 To consider and if thought fit to pass the followingresolution as an Ordinary Resolution-
ldquoResolved that in accordance with the provisions ofSection 149 read with Schedule IV of the CompaniesAct 2013 and Regulation 17 of the Securities andExchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 thisMeeting hereby approves the appointment ofMr Mohan Swarup Bhatnagar (DIN 00834857) as anIndependent Director of the Company for a period offive years with effect from 28th June 2019 or till suchearlier date as may be determined by any applicablestatutes rules regulations or guidelinesrdquo
6 To consider and if thought fit to pass the followingresolution as a Special Resolution-
ldquoResolved that in accordance with the provisions ofSection 149 read with Schedule IV of the Companies
GUJARAT HOTELS LIMITEDCIN L55100GJ1982PLC005408
Registered Office WelcomHotel Vadodara R C Dutt Road Alkapuri Vadodara-390 007Tel +91 0265 233 0033 E-mail ghlinvestorsyahoocoin Website wwwgujarathotelsltdin
NOTICE OF 37TH ANNUAL GENERAL MEETING
AGM NOTICE
Act 2013 and Regulation 17 of the Securities andExchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 thisMeeting hereby approves the re-appointment ofMr Cheruvettolil Kochukoshy Koshy (DIN 01478704)as an Independent Director of the Company for aperiod of five years with effect from 29th September2019 or till such earlier date as may be determinedby any applicable statutes rules regulations orguidelinesrdquo
7 To consider and if thought fit to pass the followingresolution as a Special Resolution-
ldquoResolved that in accordance with the provisions ofSection 149 read with Schedule IV of the CompaniesAct 2013 and Regulation 17 of the Securities andExchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 thisMeeting hereby approves the re-appointment ofMr Mahalinga Narayanan (DIN 00159288) as anIndependent Director of the Company for a period offive years with effect from 29th September 2019 or tillsuch earlier date as may be determined by anyapplicable statutes rules regulations or guidelinesrdquo
The Register of Members of the Company will remainclosed from Friday 30th August 2019 to Saturday7th September 2019 both days inclusive ShareTransfers received in order at the Companyrsquos Registrarand Share Transfer Agents Messrs MCS ShareTransfer Agent Limited F-65 1st Floor Okhla IndustrialArea Phase - I New Delhi - 110 020 by 530 pm onThursday 29th August 2019 will be processed forpayment of dividend if declared to the transferees orto their mandatees and the dividend if declared willbe paid on Friday 13th September 2019 to thoseMembers entitled thereto and whose names willappear in the Register of Members of the Companyon 7th September 2019 or to their mandatees subjecthowever to the provisions of Section 126 of theCompanies Act 2013 In respect of dematerialisedshares the dividend will be paid on the basis ofbeneficial ownership as on 29th August 2019 as perdetails to be furnished by National SecuritiesDepository Limited (NSDL) and Central DepositoryServices (India) Limited (CDSL) for this purpose
By Order of the BoardGujarat Hotels Limited
Place New Delhi Jagdish SinghDate 15th July 2019 Director
4
NOTES
1 A Member entitled to attend and vote at the AnnualGeneral Meeting (lsquoAGMrsquo) may appoint a proxy toattend and vote on his behalf A proxy need not be aMember of the Company
Proxies in order to be effective must be received atthe Registered Office of the Company not less thanforty-eight hours before the commencement of the AGMie by 1100 am on 5th September 2019
Corporate Members are required to send to theRegistered Office of the Company a certified copy ofthe Board Resolution pursuant to Section 113 of theCompanies Act 2013 (lsquothe Actrsquo) authorising theirrepresentatives to attend and vote at the AGM
2 Explanatory Statement pursuant to Section 102 of theAct relating to the Special Business to be transactedat this AGM is annexed
3 Route map of the AGM venue pursuant to theSecretarial Standard on General Meetings is alsoannexed
4 In terms of Section 108 of the Act read with Rule 20 ofthe Companies (Management and Administration)Rules 2014 the Resolutions for consideration at thisAGM will be transacted through remote e-voting (facilityto cast vote from a place other than the venue of theAGM) for which purpose the Board of Directors of theCompany (lsquothe Boardrsquo) have engaged the services ofCDSL
The facility for voting through ballot paper will beavailable at the AGM venue for those Members who donot cast their votes by remote e-voting prior to the AGMMembers who cast their votes by remote e-voting mayattend the Meeting but will not be entitled to cast theirvotes once again The Board has appointedMr Suresh Kabra (ACS 9711) Partner Messrs SamdaniKabra amp Associates Company Secretaries as theScrutinizer to scrutinize the process of remote e-votingand voting through ballot paper at the AGM venue
5 Voting rights will be reckoned on the paid-up value ofshares registered in the name of the Members on31st August 2019 (cut-off date) Only those Memberswhose names are recorded in the Register ofMembers of the Company or in the Register ofBeneficial Owners maintained by the Depositories ason the cut-off date will be entitled to cast their votes byremote e-voting or voting through ballot paper at theAGM venue A person who is not a Member on thecut-off date should accordingly treat this Notice as forinformation purposes only
6 Unclaimed dividend for the financial year ended31st March 2012 and the corresponding Equity Sharesof the Company in respect of which dividend
entitlements remain unclaimed for seven consecutiveyears will be due for transfer to the Investor Educationand Protection Fund of the Central Government on14th September 2019 pursuant to the provisions ofSection 124 of the Act read with the Investor Educationand Protection Fund Authority (Accounting AuditTransfer and Refund) Rules 2016 Members arerequested to claim the said dividend details of whichare available on the Companyrsquos websitewwwgujarathotelsltdin under the section lsquoGeneralInformationrsquo under lsquoShareholder Valuersquo The Companywill not be able to entertain any claim received after12th September 2019 in respect of the same
7 Members may visit the Companyrsquos website to viewthe Financial Statements or access informationpertaining to the Company Queries if any should besent at least 10 days before the AGM to theChief Financial Officer at the Registered Office of theCompany
8 Members are required to bring their admission slipsto the AGM Duplicate admission slips or copies of theReport and Accounts will not be made available at theAGM venue
9 The procedure with respect to remote e-voting isprovided below
I The period for remote e-voting begins onTuesday 3rd September 2019 at 900 am andends on Friday 6th September 2019 at 500 pmDuring this period Members of the Companyholding shares either in certificate form or indematerialised form as on the cut-off date ie31st August 2019 may cast their voteselectronically The e-voting module shall bedisabled by CDSL for voting thereafter
II The Members should log on to the e-votingwebsite wwwevotingindiacom
III Click on lsquoShareholders MembersrsquoIV Now enter your user ID as under
bull For CDSL 16 digits beneficiary ID
bull For NSDL 8 character DP ID followed by 8digits Client ID
bull Members holding shares in certificate formshould enter Folio Number registered withthe Company
V Thereafter enter the image verification code asdisplayed and Click on lsquoLoginrsquo
VI If you are holding shares in dematerialised formand had logged on to wwwevotingindiacom andcasted your vote earlier for any company thenyour existing password is to be used If you have
5
forgotten the password then enter user ID andthe image verification code and click on forgotpassword amp enter the details as prompted by thesystem
VII If you are a first time user please follow the stepsgiven below
For Members holding shares either in dematerialisedform or in certificate form
PAN Enter your 10 digit alpha-numeric PAN issuedby Income Tax Departmentbull Members who have not updated their
PAN with the Company DepositoryParticipant are requested to use the firsttwo letters of their name and the 8 digitsof the sequence number in the PAN field
bull In case the sequence number is lessthan 8 digits enter the applicable numberof 0rsquos before the number after the firsttwo characters of the name in CAPITALletters Eg If your name is RameshKumar with sequence number I thenenter RA00000001 in the PAN field
Dividend Enter the Dividend Bank Details or Date ofBank Birth (in ddmmyyyy format) as recorded inDetails your demat account or in the CompanyOR records in order to loginDate of bull If both the details are not recorded withBirth the Depository or the Company please
enter your member ID folio number inthe Dividend Bank details field asmentioned in instruction IV
VIII After entering these details appropriately click onlsquoSubmitrsquo
IX Members holding shares in certificate form willthen reach directly to the Companyrsquos selectionscreen
X Members holding shares in dematerialised formwill then reach the lsquoPassword Creationrsquo menuwherein they are required to mandatorily entertheir login password in the new password fieldKindly note that this password can be used forvoting on resolutions of any other company onwhich you are eligible to vote provided that thesaid company opts for e-voting through CDSLplatform It is strongly recommended not to shareyour password with any other person and takeutmost care to keep your password confidential
XI For Members holding shares in certificate formthe details can be used only for e-voting on theResolutions contained in this Notice
XII Click on the EVSN for Gujarat Hotels Limited
XIII On the voting page you will see lsquoResolutionDescriptionrsquo and against the same the optionlsquoYes Norsquo for voting Select the option lsquoYesrsquo or lsquoNorsquoas desired The option lsquoYesrsquo implies that youassent to the Resolution and the option lsquoNorsquoimplies that you dissent to the Resolution
XIV Click on the lsquoResolutions File Linkrsquo if you wish toview the entire Resolution details
XV After selecting the Resolution you have decidedto vote on click on lsquoSubmitrsquo A confirmation boxwill be displayed If you wish to confirm your voteclick on lsquoOkrsquo else to change your vote click onlsquoCancelrsquo and accordingly modify your vote
XVI Once you lsquoConfirmrsquo your vote on the Resolutionyou will not be allowed to modify your vote
XVII You can also take a print of the votes cast byclicking on lsquoClick here to printrsquo option on theVoting page
XVIII Members can also cast their vote using CDSLrsquosmobile app lsquom-Votingrsquo available on Android Appleand Windows based mobiles Members may login to m-Voting using their e-voting credentials tovote on the Company Resolutions
XIX Note for NonndashIndividual Members and Custodians
bull Non-Individuals Members (ie other than HUFIndividuals NRI etc) and Custodians are requiredto log on to wwwevotingindiacom and registerthemselves as Corporates
bull A scanned copy of the Registration Form bearingthe stamp and sign of the entity should be emailedto helpdeskevotingcdslindiacom
bull After receiving the login details user would be ableto link the account(s) for which they wish to voteon
bull The list of accounts linked in the login should bemailed to helpdeskevotingcdslindiacom and onapproval of the accounts they would be able tocast their vote
bull A scanned copy of the Board Resolution and Powerof Attorney (POA) which they have issued in favourof the Custodian if any should be uploaded in PDFformat in the system for the Scrutinizer to verify thesame
XX In case you have any queries or issues regardinge-voting you may refer to the Frequently AskedQuestions and e-voting manual available underthe help section of CDSLrsquos e-voting websitewwwevotingindiacom or write an email tohelpdeskevotingcdslindiacom or contact
6
Mr Rakesh Dalvi at telephone no 18002005533(toll free) You may also address your queries grievances relating to remote e-voting or votingat the meeting to Mr M Agarwal ComplianceOfficer at e-mail ID ghlinvestorsyahoocoin orat telephone no 0265 233 0033
XXI Those who become Members of the Companyafter despatch of the Notice but on or before31st August 2019 (cut-off date) may follow thesteps from Sl Nos II to XIX mentioned above forcasting of vote
XXII General Information
(a) There will be one vote for every Client ID NoRegistered Folio No irrespective of thenumber of joint holders
(b) The Results of voting will be declaredwithin 48 hours from the conclusion of theAGM and the Resolutions will be deemedto be passed on the date of the AGMsubject to receipt of requisite number ofvotes The declared Results along with theScrutinizerrsquos Report will be availableforthwith on the Companyrsquos websitewwwgujarathotelsltdin under the sectionlsquoInvestor Relationsrsquo and on the website ofCDSL such Results will also be forwardedto BSE Limited where the Companyrsquosshares are listed
EXPLANATORY STATEMENT
Annexed to the Notice convening the Thirty Seventh AnnualGeneral Meeting to be held on Saturday 7th September2019
Item No 5
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 28th June 2019 on the recommendationof the Nominations and Remuneration Committee(lsquothe Committeersquo) approved the appointment of Mr MohanSwarup Bhatnagar as Additional Director with effect from28th June 2019 and subject to the approval of the Membersalso as Independent Director of the Company for a periodof five years with effect from the said date in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquotheActrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquothe Listing Regulations2015rsquo)
Mr Bhatnagar (67) is a Science Graduate from St StephenrsquosCollege University of Delhi and is an MBA from the Facultyof Management Studies University of Delhi
Mr Bhatnagar joined ITC Limited (ITC) in 1975 in the HotelsDivision He held various job positions in Finance beforetaking over as the Head of Finance in 1997 withresponsibility for Treasury Audit Purchasing MaterialManagement and Information Technology Subsequentlyhe held charge of Growth and Development for the HotelsBusiness as Executive Vice President He was a memberof the Management Committee of the Division and was onthe Boards of Joint Venture and Subsidiary companies ofITC He retired from ITC in September 2013 Currently heis actively involved in angel investing and in mentoringselect start-up ventures
The Committee and the Board are of the view that theassociation of Mr Bhatnagar and the rich experience hebrings with him would benefit the Company Declarationhas been received from Mr Bhatnagar that he meets thecriteria of Independence prescribed under Section 149 ofthe Act read with the Companies (Appointment andQualification of Directors) Rules 2014 and Regulation 16of the Listing Regulations 2015 In the opinion of your BoardMr Bhatnagar fulfils the conditions specified in the Act theRules thereunder and the Listing Regulations 2015 forappointment as an Independent Director and he isindependent of the management of the CompanyMr Bhatnagar will be entitled to sitting fees for attending themeetings of the Board and its Committees
Requisite Notice under Section 160 of the Act proposingthe appointment of Mr Bhatnagar has been received by theCompany and consent has been filled by Mr Bhatnagarpursuant to Section 152 of the Act
Mr Bhatnagar holds 2500 shares in the Company
Mr Bhatnagar and his relatives are interested in thisResolution None of the other Directors and Key ManagerialPersonnel of the Company or their relatives is interestedin this Resolution
The Board recommends this Resolution for your approval
Item Nos 6 amp 7
The Members of the Company at the Thirty Second AnnualGeneral Meeting held on 29th September 2014 approvedthe appointment of Mr Koshy and Mr M Narayanan asIndependent Directors of the Company for a period of fiveyears with effect from the said date Mr Koshy andMr Narayanan will complete their respective terms on28th September 2019
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 15th April 2019 on the recommendationof the Nominations and Remuneration Committee (lsquotheCommitteersquo) recommended for the approval of theMembers the re-appointment of Mr Koshy andMr Narayanan as Independent Directors of the Companywith effect from 29th September 2019 in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquothe
7
Actrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquoListing Regulations2015rsquo) as set out in the Resolutions relating to theirrespective re-appointment
The Committee and the Board are of the view that giventhe knowledge experience and performance of Mr Koshyand Mr Narayanan and contribution to the Board processesby them their continued association would benefit theCompany Declarations have been received from Mr Koshyand Mr Narayanan that they meet the criteria ofIndependence prescribed under Section 149 of the Act readwith the Companies (Appointment and Qualification ofDirectors) Rules 2014 and Regulation 16 of the ListingRegulations 2015 In the opinion of the Board Mr Koshyand Mr Narayanan fulfil the conditions specified in the Actthe Rules thereunder and the Listing Regulations 2015 forre-appointment as Independent Directors and they areindependent of the management of the Company Mr Koshyand Mr Narayanan will be entitled to sitting fees for attendingmeetings of the Board and its Committees
Consent of the Members by way of Special Resolution isrequired for re-appointment of Mr Koshy and Mr Narayananin terms of Section 149 of the Act Further pursuant toRegulation 17 of the Listing Regulations 2015 consent ofthe Members by way of Special Resolution is also requiredfor continuation of a Non-Executive Director beyond the ageof seventy five years During the proposed term ofre-appointment Mr Koshy and Mr Narayanan will attain theage of seventy five years on 12th February 2020 and1st July 2020 respectively The Special Resolutions under
Item No 6 and 7 once passed shall also be deemed asyour approval under the Listing Regulations 2015 forcontinuation of Mr Koshy and Mr Narayanan as IndependentDirectors beyond the age of seventy five years
Requisite Notices under Section 160 of the Act proposingthe re-appointment of Mr Koshy and Mr Narayanan havebeen received by the Company and consents have beenfiled by Mr Koshy and Mr Narayanan pursuant to Section152 of the Act
Additional information in respect of Mr Koshy andMr Narayanan pursuant to the Listing Regulations 2015and the Secretarial Standard on General Meetings isappearing in the Report and Accounts under the sectionslsquoYour Directorsrsquo and lsquoReport on Corporate GovernancersquoMr Koshy and Mr Narayanan do not hold any share in theCompany either in their individual capacity or on a beneficialbasis for any other person
Mr Koshy and Mr Narayanan and their relatives areinterested in the Special Resolutions relating to theirrespective re-appointment None of the other Directors andKey Managerial Personnel of the Company or theirrelatives is interested in these Special Resolutions
The Board recommends these Special Resolutions for yourapproval
By Order of the BoardGujarat Hotels Limited
Place New Delhi Jagdish SinghDate 15th July 2019 Director
8
ROUTE MAP
AGM VenueWelcomHotel VadodaraR C Dutt Road AlkapuriVadodara 390 007
9
N Anand
Nakul Anand (62) DIN 00022279 a Non-Executive Directorof the Company since 10th March 1998 was appointed asthe Chairman of the Company effective 21st March 2009He is an Executive Director on the Board of ITC Limited andholds responsibility for the Hospitality Travel amp Tourismand Lifestyle Retailing businesses of ITC
An Economics Honours Graduate from the Delhi Universitywith an AMP degree from the Bond University AustraliaAnand joined ITC Hotelsrsquo Management TrainingProgramme in 1978 He has also served as the ManagingDirector of erstwhile ITC Hotels Limited during the period2003-05
In a career that spans close to four decades Anand hasbeen acknowledged in the hotels and tourism industry forhis vision and commitment Leveraging the significantlearning of sustainable excellence within ITC he led theteam at ITC Hotels to pioneer the concept of lsquoResponsibleLuxuryrsquo in the hospitality industry securing LEEDreg Platinumcertifications for all ITC premium luxury hotels He hasformulated value-based strategies to create a uniquequality control model His dynamic leadership and passionfor the business is recognised and acknowledged by hispeers He has been a past President of the HotelAssociation of India and past Chairman of the CII NationalTourism Committee Anand is presently a member of theNational Tourism Advisory Council constituted by theMinistry of Tourism Government of India Chairman of theFederation of Associations in Indian Tourism amp Hospitalityand a Member of the Executive Committee of the HotelAssociation of India He is also a Member of the IndiandashSriLanka CEOs Forum Council Member amp ExecutiveCommittee Member of the National Culture Fund Ministryof Culture Government of India and a Member on the Boardof the International Tourism Partnership
Other Directorships
Name of the company Position
International Travel House Limited Chairman amp Non-Executive Director
Landbase India Limited Chairman amp Non-Executive Director
Fortune Park Hotels Limited Chairman amp Non-Executive Director
WelcomHotels Lanka (Private) Limited Chairman amp Non-Executive Director
Srinivasa Resorts Limited Vice Chairman amp Non-Executive Director
ITC Limited Executive Director
Bay Islands Hotels Limited Non-Executive Director
Maharaja Heritage Resorts Limited Non-Executive Director
Committee Membership of other companies
Name of the Committee Positioncompany
International Travel House Limited Nominations amp MemberRemuneration Committee
Landbase India Limited Audit Committee Member
Fortune Park Hotels Limited Corporate Social ChairmanResponsibility Committee
CK Koshy
Cheruvettolil Kochukoshy Koshy (74) DIN01478704 wasappointed as an Independent Non-Executive Director ofthe Company on 1st May 2007 He is Master of Arts inPolitical Science and Public Administration He joined theIndian Administrative Service in 1968 from the Gujarat Cadreand superannuated in February 2005
In a long career spanning over 38 years he has held severaleminent positions including those of Additional ChiefSecretary - Department of Revenue Industries and MinesTourism and Civil Aviation and Finance and PrincipalSecretary to the Chief Minister He served the Governmentof India as Joint Secretary amp Financial Advisor to theDepartment of Atomic Energy and as Executive Director ofNuclear Power Corporation of India Limited He has heldthe posts of Managing Director of the Tourism Corporationof Gujarat Sardar Sarovar Narmada Nigam Gujarat StateSmall Industries Corporation and Girinar Scooter LimitedHe was also the Joint Managing Director of the GujaratIndustrial Investment Corporation and Chairman of GujaratState Petroleum Corporation Limited Gujarat State PetronetLimited and Gujarat Energy Research and ManagementInstitute
Post retirement he has been a consultant to the Departmentfor International Development - UK the World Bank and tothe Department of Personnel and Administrative ReformsGovt of India He was appointed Professor Emeritus in thefaculty of Planning and Public Policy at CEPT UniversityAhmedabad and is an Advisor to both Indian School ofPetroleum and Energy New Delhi and University ofPetroleum and Energy Studies Dehradun Currently he isAdvisor at CEPT University and on the Board of Trustees ofAlliance Francaise Gujarat and GIAN an NGO whichencourages innovation at the grass root level
Koshy does not hold directorship of any other company
M Narayanan
Mahalinga Narayanan (74) DIN 00159288 was appointedas an Independent Non-Executive Director of the Companyon 10th January 2008 He is a post graduate in CommerceGraduate in Law Diploma Holder in Business Managementand holds certified Associated Membership of the Indian
YOUR DIRECTORS
10
Institute of Bankers He has rich experience of over fourdecades in Banking Project Finance Administration andrelated areas
Narayanan started his career with the Reserve Bank ofIndia in 1964 and moved over to the Bank of Baroda in1969 and continued till March 1985 During his tenure inBank of Baroda he worked in all departments of commercialbanking operation and was in-charge of large branches ofthe Bank In April 1985 he joined Industrial FinanceCorporation of India and held senior managementpositions In October 1997 he joined Tourism FinanceCorporation of India Limited as Managing Director and roseto the position of Chairman and Managing Director whichposition he held till his retirement in September 2006 Hewas conferred with ldquoUdyog Rattan Awardrdquo in the year 2005by the Institute of Economic Studies New Delhi
Other Directorships
Name of the company Position
Cox amp Kings Limited Independent DirectorTulip Star Hotels Limited Independent DirectorRoyale Indian Rail Tours Limited Independent DirectorPride Hotels Limited Chairman amp Independent Director
Committee Membership of other Companies
Name of the company Committee Position
Cox amp Kings Limited Audit Committee ChairmanRemuneration MemberCommittee
Pride Hotels Limited Audit Committee ChairmanRoyale Indian Rail Tours Limited Audit Committee Chairman
Tulip Star Hotels Limited Audit Committee Chairman
J Singh
Jagdish Singh (53) DIN 00042258 was appointed as aNon-Executive Director on the Board of the Company on16th April 2016 A Commerce Graduate and a CharteredAccountant Singh joined ITC Limited in the year 1990During these 26 years he has held various positions inthe finance function He started his career in Treasury andmoved as Corporate Accountant Commercial Manager atCigarette factory at Munger and Head of Finance at ITCEssentra Limited He was then the Head of Treasury
between 2005 and 2015 and is presently the Head ofFinance at ITCrsquos Hotels Division
Other DirectorshipsName of the company Position
International Travel House Limited Non-Executive DirectorFortune Park Hotels Limited Non-Executive DirectorBay Islands Hotels Limited Non-Executive DirectorSrinivasa Resorts Limited Non-Executive DirectorMaharaja Heritage Resorts Limited Non-Executive DirectorMimec (India) Limited Non-Executive DirectorLandbase India Limited Additional Non-Executive DirectorLogix Developers Private Limited Non-Executive Director
Committee Membership of other companiesName of the Committee Positioncompany
International Travel House Limited Stakeholders Relationship MemberCommitteeAudit Committee MemberNominations amp Remuneration MemberCommittee
Fortune Park Hotels Limited Corporate Social MemberResponsibility Committee
Srinivasa Resorts Limited Audit Committee ChairmanCorporate Social MemberResponsibility Committee
D R Choudhury
Devkanya Roy Choudhury (41) DIN 07066556 wasappointed as a Non-Executive Director of the Company on19th January 2015 A Graduate from the National LawSchool of India University Bengaluru she joined ITC Limitedin 2001 As part of Corporate Legal of ITC she has rich andvaried experience in handling legal matters pertaining tovarious divisions including Tobacco Hotels Personal CareLifestyle Retailing Education amp Stationery Paperboards ampSpecialty Papers ITC Infotech as also dealing with mergersamp acquisitions and key litigation across ITC CurrentlyMs Choudhury is the Senior Associate General Counsel ofITC Limited
Other Directorships
Name of the Company Position
WelcomHotels Lanka (Private) Limited Non-Executive Director
YOUR DIRECTORS
Denotes foreign company Denotes listed Indian company whose equity shares or preference shares or debt securities are listed on a recognised
stock exchangeNotes1 Other Directorships and Committee Memberships of Directors are as on 15th April 20192 Committee Memberships cover Committees under the Companies Act 2013 viz Audit Committee Stakeholders
Relationship Committee Nomination and Remuneration Committee and CSR Committee of Indian Companies
11
REPORT ON CORPORATE GOVERNANCE
The Directors present the Companyrsquos Report on CorporateGovernance pursuant to the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements)Regulations 2015 (lsquoListing Regulations 2015rsquo)
THE COMPANYrsquoS GOVERNANCE PHILOSOPHY
The Company firmly believes in good CorporateGovernance and has made it a practice and a continuousprocess of development right across the Company TheCompanyrsquos philosophy on Corporate Governanceenvisages attainment of high level of transparency andaccountability in the functioning of the Company andconduct of business and places due emphasis onregulatory compliance It has empowered the ExecutiveManagement to take decisions with regard to day-to-dayoperations and has also created checks and balances thatsuch decisions are taken with care and responsibility tomeet stakeholdersrsquo aspirations and societal expectations
The Companyrsquos corporate philosophy is focused on itspeople who are its most important asset and it values itsemployeesrsquo integrity creativity ability judgement andopinions who in turn demonstrate the highest ethicalstandards and responsibility towards the shareholdersThis has helped the Company take rapid strides in itspursuit of excellence
The Company is committed to enhance shareholder valuein a fair and transparent manner and has been in theforefront for benchmarking itself with the best businesspractices globally
BOARD OF DIRECTORS
All statutory and other significant and material informationare placed before the Board of Directors (the Board) toenable it to discharge its responsibility of strategicsupervision of the Company as trustees of theshareholders
Composition
The Board comprises entirely of Non-Executive Directorsincluding one Woman Director and two IndependentDirectors The strength of the Board as on 15th April 2019is five
The Board Diversity Policy of the Company requires theBoard to have balance of skills experience and diversity ofperspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the Annexure forming part ofthis Report These skills expertise and competencies areavailable in the present mix of the Directors of the Company
Composition of the Board as on 31st March 2019
Category No of PercentageDirectors to total no
of Directors
Non-Executive Independent Directors 3 50Other Non-Executive Directors 3 50Total 6 100
During the year there was no change in the directorshipMr R C Mehta resigned as Non-Executive IndependentDirector of the Company with close of work on 31st March2019 keeping in view the Regulation 17(1A) of ListingRegulations 2015
Mr Mehta has confirmed that there are no other reasons forhis resignation other than stated above
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Board were held The intervening periodbetween two Board meetings was well within the maximumgap of 120 days prescribed under the Listing Regulations2015
Board Agenda
Meetings are governed by a structured agenda The Boardmembers in consultation with the Chairman may bring upany matter for the consideration of the Board All majoragenda items are backed by comprehensive backgroundinformation to enable the Board to take informed decisionsAgenda papers are generally circulated seven days prior tothe Board meeting
Information placed before the Board
The following matters are tabled for the Boardrsquos periodicreview information
bull Annual operating plans amp budgets and periodic reviewof the Companyrsquos businesses
bull Quarterly performance
bull External Audit Management Reports (through the AuditCommittee)
bull Status of legal compliance
bull Status and effectiveness of risk management plans
bull Succession to senior management (through theNominations and Remuneration Committee)
bull Statutory compliance reports
bull Show cause demand prosecution adjudicationnotices if any from revenue authorities which areconsidered materially important including anyexposure that exceeds 1 of the Companyrsquos net worthand their outcome
12
bull W rite-offs disposals (fixed assets receivablesadvances etc) on a half-yearly basis
bull Significant development in Human Resources Industrial Relations
bull Material non-compliance of any regulatory or listingrequirements and in relation to shareholdersrsquoservices
bull All other matters required to be placed before theBoard for its review information under the ListingRegulations 2015 and other statutes
Post-meeting follow-up systemThe Governance processes in the Company include aneffective post-meeting follow-up review and reportingprocess for action taken pending on decisions of the Boardand the Board Committees
Details of Board Meeting during the financial year
During the financial year ended 31st March 2019 fourmeetings of the Board were held as follows
SI Date Board No ofNo Strength Directors
present
1 17th April 2018 6 6
2 7th August 2018 6 6
3 1st November 2018 6 5
4 30th January 2019 6 5
COMMITTEES OF THE BOARD
Currently there are three Committees of the Board ndash theAudit Committee the Stakeholders RelationshipCommittee and the Nominations and RemunerationCommittee The terms of reference of the BoardCommittees are determined by the Board from time to timeMeetings of Board Committees are convened by therespective Committee Chairman All the recommendationsmade by Board Committees during the year were acceptedby the Board Minutes of Board Committee meetings areplaced before the Board for its information The role andcomposition of these Committees including the numberof meetings held during the financial year and the relatedattendance are provided below
A AUDIT COMMITTEEThe Audit Committee of the Board provides reassurance tothe Board on the existence of an effective internal controlenvironment that ensuresbull efficiency and effectiveness of operations
bull safeguarding of assets and adequacy of provisionsfor all liabilities
bull reliability of financial and other managementinformation and adequacy of disclosures
bull compliance with all relevant statutesThe role of the Committee includes the followingbull To oversee the Companyrsquos financial reporting process
and the disclosure of its financial information to
REPORT ON CORPORATE GOVERNANCE
Directorsrsquo attendance at the Board Meetings during the financial year and at the last Annual General Meeting (AGM) as alsotheir other Directorships and Committee Memberships are given below
SI Director Category No of Attendance No of No of Membership(s) No Board at last other Chairmanship(s) of Audit
Meetings AGM Directorship(s) Committee Stakeholdersattended Relationship Committee of
other Indian public limitedcompanies
1 N Anand Chairman amp 4 Yes 8 1Non-Executive Director
2 C K Koshy Non-Executive 4 Yes Nil NilIndependent Director
3 R C Mehta1 Non-Executive 2 Yes 4 NilIndependent Director
4 M Narayanan Non-Executive 4 Yes 4 4 (all as Chairman)Independent Director
5 D R Choudhary Non-Executive Director 4 Yes 1 Nil6 J Singh Non-Executive Director 4 Yes 8 3 (including 1 as Chairman)
1 Resigned as Non-Executive Independent Director wef 1st April 2019 Details with respect to other Directorships of the Directors are provided under the section lsquoYour Directorsrsquo in the Report and Accounts
13
ensure that the financial statements are correctsufficient and credible
bull To recommend the appointment remuneration termsof appointment and removal of Statutory Auditors
bull To approve transactions of the Company with relatedparties
bull To evaluate the Companyrsquos internal financial controlsand risk management systems
bull To review with the management the following
- Annual financial statements and Auditorrsquos Reportthereon before submission to the Board forapproval
- Quarterly financial statements before submissionto the Board for approval
bull To review the following
- Management discussion and analysis of financialcondition amp results of operations and mattersrequired to be included in the DirectorsrsquoResponsibility Statement
- Adequacy of internal control systems and theCompanyrsquos statement on the same prior toendorsement by the Board such review to bedone in consultation with the managementStatutory and Internal Auditors
- Adequacy of internal control systems forcompliance with the provisions of the Securitiesand Exchange Board of India (Prohibition ofInsider Trading) Regulations 2015
- Reports of Internal Audit and discussion withInternal Auditors on any significant findings andfollow-up thereon
- Statutory Auditorsrsquo independence andperformance and effectiveness of the auditprocess
- System for storage retrieval security etc of booksof account maintained in the electronic form
- Functioning of Whistleblower mechanism in theCompany
Composition
The Audit Committee as on 15th April 2019 comprisesthree Non-Executive Directors two of whom are IndependentDirectors The Chairman of the Committee is anIndependent Director The Chief Executive Officer the ChiefFinancial Officer and the representative of Statutory Auditorsare Invitees to meetings of the Audit Committee and theCompany Secretary is the Secretary to the Committee Allmembers of the Committee are financially literate twomembers including the Chairman of the Committee haveaccounting and financial management expertise
The names of the members of the Audit Committeeincluding its Chairman are provided under the sectionlsquoBoard of Directors amp Committeesrsquo in the Report andAccounts
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Audit Committee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 4 4
2 7th August 2018 4 4
3 1st November 2018 4 3
4 30th January 2019 4 3
Attendance at Audit Committee Meetings during thefinancial year
Member No of meetingsattended
M Narayanan1 4
C K Koshy 4
R C Mehta2 2
J Singh 41 Appointed Chairman wef 15th April 20192 Ceased to be Member and Chairman wef 1st April 2019
B STAKEHOLDERS RELATIONSHIP COMMITTEE
The Stakeholders Relationship Committee of the Boardoversees redressal of shareholder and investor grievancesand inter alia approves transmission of sharessub-division consolidation renewal of share certificatesissue of duplicate share certificates etc
Composition
The Stakeholders Relationship Committee presentlycomprises three Non-Executive Directors including oneIndependent Director The Chairman of the Committee is aNon-Executive Director The Company Secretary is theSecretary to the Committee
The names of the members of the StakeholdersRelationship Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 sevenmeetings of the Stakeholders Relationship Committeewere held as follows
REPORT ON CORPORATE GOVERNANCE
14
SI Date Committee No ofNo Strength Members
present1 17th April 2018 2 2
2 29th June 2018 2 2
3 7th August 2018 2 2
4 27th September 2018 2 2
5 1st November 2018 2 2
6 4th January 2019 2 2
7 30th January 2019 2 2
Attendance at Stakeholders Relationship CommitteeMeetings during the financial year
Member No of meetingsattended
J Singh 7
D R Choudhury 7
C K Koshy 0
Appointed Member wef 31st March 2019
C NOMINATIONS AND REMUNERATION COMMITTEEThe Nominations and Remuneration Committee of theBoard inter alia identifies persons qualified to becomeDirectors and formulates criteria for evaluation ofperformance of the Directors and the Board as a wholeThe Committeersquos role includes recommending to theBoard the appointment remuneration and removal ofDirectors and Key Managerial Personnel
Composition
The Nominations and Remuneration Committee as on15th April 2019 comprises four Non-Executive Directorstwo of whom are Independent Directors The Chairman ofthe Committee is an Independent Director The CompanySecretary is the Secretary to the Committee
The names of the members of the Nominations andRemuneration Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 twomeetings of the Nominations and RemunerationCommittee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 5 5
2 30th January 2019 5 4
Attendance at Nominations and Remuneration CommitteeMeetings during the financial year
Member No of meetingsattended
C K Koshy 2
N Anand 2
R C Mehta1 1
M Narayanan 2
J Singh 21 Ceased to be Member wef 1st April 2019
Remuneration Policy
The Companyrsquos Remuneration Policy aims at attractingand retaining high calibre talent The Remuneration Policytherefore is market-led and takes into account thecompetitive circumstance of each business so as to attractand retain quality talent and leverage performancesignificantly
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpwwwgujarathotels ltd in polic ies Remuneration-Policy_GHLpdf There has been no change in the Policyduring the year
Remuneration of Directors
Non-Executive Directors are entitled to sitting fees forattending the meetings of the Board and its Committeesthe quantum of which is determined by the Board Thesitting fees to Non-Executive Directors as determined bythe Board are ` 20000- and ` 10000- for each meeting ofthe Board and its Committees respectively
Details of sitting fees paid to the Directors during thefinancial year ended 31st March 2019
Director Sitting Fees (`)
C K Koshy 150000-
R C Mehta1 70000-
M Narayanan 150000-1 Resigned as Non-Executive Independent Director wef1st April 2019
Note Disclosure with respect to Non-Executive Directors ndashPecuniary relationship or transaction None
Performance Evaluation
Performance evaluation of the Board the BoardCommittees and the individual Directors was carried outby the Board in accordance with the Policy approved by theNominations and Remuneration Committee in this regardbrief details of the same are provided in the lsquoReport of theBoard of Directors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
REPORT ON CORPORATE GOVERNANCE
15
Directorsrsquo Shareholding
Details of Shareholding of the Directors in the Company ason 31st March 2019 are given below
Director No of Equity Shares of ` 10-each held singly jointly
N Anand 200
D R Choudhury Nil
C K Koshy Nil
R C Mehta Nil
M Narayanan Nil
J Singh Nil
OTHER DISCLOSURESbull Details of non-compliances penalties and strictures
by Stock Exchanges SEBI Statutory Authorities onany matter related to capital markets during the lastthree years
Nonebull Inter-se relationships between Directors and Key
Managerial Personnel of the Company
Nonebull Materially significant related party transactions which
may have potential conflict with the interests of theCompany at large
Nonebull Material financial and commercial transactions of
senior management where they may have hadpersonal interest and which had potential conflict withthe interests of the Company at large
Nonebull Details of utilisation of funds raised through
preferential allotment or qualified institutionsplacement
Not Applicablebull Credit rating(s) obtained by the Company for any debt
instrument fixed deposit programme or any otherscheme involving mobilisation of funds
Nonebull None of the Directors of the Company has been
debarred or disqualified from being appointed orcontinuing as a Director by SEBI Ministry of CorporateAffairs Statutory Authorities which has also beenconfirmed by Messrs PB amp Associates PractisingCompany Secretaries
bull Confirmation by the Board with respect to theIndependent Directors is provided in the lsquoReport ofthe Board of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Disclosures in relation to the Sexual Harassment ofWomen at Workplace (Prevention Prohibition andRedressal) Act 2013 are provided in the lsquoReport of theBoard of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Information with respect to lsquoCommodity Price Risk orForeign Exchange Risk and Hedging Activitiesrsquo
Nonebull The total fees paid by the Company to Messrs K C
Mehta amp Co Statutory Auditors and all other entitiesforming part of the same network aggregate` 100000-
bull Compliance Officer under the Listing Regulations2015
Deepak Kumar Gulati Company Secretary
MEANS OF COMMUNICATION
Timely disclosure of consistent comparable relevant andreliable information on corporate financial performance isat the core of good governance Towards this end thequarterly results of the Company were announced withinforty five days from the end of the quarter Audited annualresults along with the results for the fourth quarter wereannounced within sixty days from the end of the financialyear Extract of these results were published in lsquoTheFinancial Expressrsquo (all editions) and in its Gujarati editionas vernacular newspaper Further quarterly resultsshareholding pattern and other material events amp importantinformation relating to the Company were submitted to BSELimited through BSE Listing Centre for dissemination onits website The Company publishes its quarterlyhalf-yearly and annual financial results and also posts suchresults on its website wwwgujarathotelsltdin
The Report of the Board of Directors forming part of theReport and Accounts includes all aspects of lsquoManagementDiscussion and Analysisrsquo as required under the ListingRegulations 2015
GHL CODE OF CONDUCT FOR PREVENTION OF INSIDERTRADING ndash 2019
The GHL Code of Conduct for Prevention of Insider Tradingapproved by the Board inter alia prohibits trading insecurities of the Company by Directors and employeeswhile in possession of unpublished price sensitiveinformation in relation to the Company
GHL CODE OF CONDUCT
The GHL Code of Conduct is applicable to Directors seniormanagement and employees of the Company The Codeis derived from three interlinked fundamental principlesviz good corporate governance good corporate citizenshipand exemplary personal conduct in relation to theCompanyrsquos business and reputation The Code coversGHLrsquos commitment to sustainable development concern
REPORT ON CORPORATE GOVERNANCE
16
for occupational health safety and environment a genderfriendly workplace transparency and auditability legalcompliance and the philosophy of leading by personalexample The Code is available on the Companyrsquos website
Declaration as required under the Listing Regulations 2015All Directors and senior management of the Companyhave affirmed compliance with the GHL Code of Conductfor the financial year ended 31st March 2019New Delhi K Pahwa15th April 2019 CEO
WHISTLEBLOWER POLICYSynopsis of the Whistleblower Policy of the Company isprovided in the lsquoReport of the Board of Directors ampManagement Discussion and Analysisrsquo forming part of theReport and Accounts The Whistleblower Policy is alsoavailable on the Companyrsquos websiteFAMILIARISATION PROGRAMME FOR DIRECTORSGHL believes that a Board which is well informed familiarised with the Company and its affairs can contributesignificantly to effectively discharge its role of trusteeshipin a manner that fulfils stakeholdersrsquo aspirations andsocietal expectations In pursuit of this the Directors of theCompany are updated on changes developments in thedomestic global corporate and industry scenario includingthose pertaining to statutes legislations and economicenvironment and on matters affecting the Company toenable them to take well informed and timely decisionsFurther details may be accessed on the Companyrsquos websiteat httpwwwgujarathotelsltdinpoliciesDirectorrsquos-Familiarisation-programmespdfPOLICY ON RELATED PARTY TRANSACTIONSThe Policy as approved by the Board may be accessed onthe Companyrsquos website at
h t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_TranscationspdfDISCRETIONARY REQUIREMENTS UNDER THE LISTINGREGULATIONS 2015The status of compliance with the discretionaryrequirements under the Listing Regulations 2015 isprovided below1 Chairmanrsquos Office The Company has a Non-Executive
Chairman but he does not maintain any separate officeand hence no expense in this regard is being incurredby the Company
2 Shareholder Rights The quarterly half-yearly andannual financial results of the Company are postedon the Companyrsquos website and extract of these resultsare published in newspapers on an all India basisThe complete Report and Accounts is sent to everyShareholder of the Company
3 Audit Opinion It has always been the Companyrsquosendevour to present financial statements with
unmodified audit opinion The Statutory Auditors haveissued an unmodified audit opinion on the Companyrsquosfinancial statements for the year ended 31st March2019
4 Separate posts of Chairman and Chief ExecutiveOfficer The Company has a Non-Executive Chairmanand a Chief Executive Officer
5 Internal Audit The Internal Auditor of the CompanyMessrs Shah amp Talati Chartered Accountants reportsto the Audit Committee of the Board
GENERAL SHAREHOLDER INFORMATIONProvided in the lsquoShareholder Informationrsquo section of theReport and Accounts
CONFIRMATION OF COMPLIANCEbull It is confirmed that the Company has complied with
the requirements prescribed under Regulations 17 to27 and clauses (b) to (i) of sub - regulation (2) ofRegulation 46 of the Listing Regulations 2015
bull The Statutory Auditorsrsquo Certificate that the Companyhas complied with the conditions of CorporateGovernance is annexed to the lsquoReport of the Board ofDirectors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
ANNEXURE TO THE REPORT ON CORPORATEGOVERNANCESKILLS EXPERTISE AND COMPETENCIES OF DIRECTORSThe Company believes that Board members should havea balance of skills experience and diversity of perspectivesappropriate to the Company Accordingly the Directorsshould possess one or more of the following skillsexpertise and competencies
1 Leadership
Leadership experience in a commensurate-sizedorganisation with understanding of organisationalsystems and processes strategic areas andemerging business trends
2 Industry Knowledge and Experience
Domain knowledge of Hotel business and itsdynamics long-term strategies and regulatory ampcompetitive environment
3 Finance and Accounting
Ability to understand financial policies accountingstatements and disclosure practices to contribute tothe financial risk management policies and practicesof the Company
4 Governance
Commitment belief and experience in settinggovernance practices to support the Companys legalcompliance systems and governance polic ies practices
REPORT ON CORPORATE GOVERNANCE
17
SHAREHOLDER INFORMATION
AGM Details
Date Saturday 7th September 2019Venue WelcomHotel Vadodara R C Dutt Road
Alkapuri Vadodara 390 007Time 1100 amBook Friday 30th August 2019 toClosure Saturday 7th September 2019Dates (both days inclusive)Dividend Friday 13th September 2019PaymentDate
Registrar and Share Transfer Agents
Messrs MCS Share Transfer Agent Limited are the Registrarand Share Transfer Agents (RTA) of the Company forcarrying out share registration and other related activitiesof the Company
Address for Correspondence
MCS Share Transfer Agent LimitedF-65 1st Floor Okhla Industrial AreaPhase ndash I New Delhi - 110 020Telephone Nos 011 4140 6149-52 4160 9386Facsimile No 011 4170 9881E-mail helpdeskdelhimcsregistrarscom
Shareholders holding shares in the dematerialised formshould address their correspondence except those relatedto dividend to their respective Depository Participants
Share Transfer Committee
The Share Transfer Committee of the Company generallymeets once in ten days for approving share transfers Theprocessing activities with respect to requests received forshare transfers are completed within fifteen days from thedate of receipt of request The Committee met 11 timesduring the financial year ended 31st March 2019 to approveshare transfers There were no share transfers pendingas on 31st March 2019
The Share Transfer Committee presently comprises thefollowing
D R Choudhury - Director MemberJ Singh - Director MemberM Agarwal - Compliance Officer Member
Dematerialisation of Shares and Liquidity
The shares of the Company are available for trading in thedematerialised form under both the Depository Systems inIndia - NSDL and CDSL The International SecuritiesIdentification Number (lSIN) allotted to the Companysshares under the Depository System is INE621C01011
As on 31st March 2019 a total of 3525013 Equity Sharesof the Company which translates to 9307 of the ShareCapital stood dematerialised The processing activitieswith respect to requests received for dematerialisation arecompleted between fifteen to thirty daysShareholder Investor ComplaintsThe Company attends to Shareholder Investor complaintsqueries and other correspondence generally within fifteendays except where constrained by disputes or legalimpedimentsThe Company did not receive any complaint during thefinancial year ended 31st March 2019The e-mail ID earmarked by the Company for this purposeghlinvestorsyahoocoinDistribution of Shareholding as on 31st March 2019
No of No of EquityNo of Shareholders Shares
SharesSlab Total to Total to
Share Shareholders Capital
1 - 500 5152 9455 587438 1551501 - 1000 138 253 112061 296
1001 - 2000 68 125 100167 2652001 - 3000 26 048 62030 1643001 - 4000 16 029 58804 1554001 - 5000 11 020 50785 1345001 - 10000 23 042 163405 431
10001 - 50000 8 015 147787 39050001 - 100000 3 006 226954 599
100001 amp Above 4 007 2278084 6015Total 5449 10000 3787515 10000
Categories of Shareholders as on 31st March 2019Sl Category No of toNo Shares Share
held hold ingA Promoter Holding1 Promoter and Promoter Group
ITC Limited 1733907 4578Russell Investments Limited 300056 792Sub-Total 2033963 5370
B Non Promoter Holding2 Institutional Investorsa Mutual Funds NIL NILb Banks 100 000c Foreign Institutional Investors and NIL NIL
Foreign Portfolio InvestorsSub-Total 100 000
3 Othersa Private Corporate Bodies 193726 511b Indian Public 1335461 3527c NRIs 102362 270d Others 121903 322
Sub Total 1753452 4630Grand Total 3787515 10000
18
Monthly High and Low Quotes and Volume of Sharestraded on BSE Limited
Year Month High L o w Volume(` ) (` ) (Nos)
2018 April 13800 12000 93584May 13100 11710 26778June 12735 11500 18090July 12195 11400 27113August 12295 11450 14900September 12000 10900 23492October 11400 10505 18787November 12975 10700 15386December 11490 10700 40291
2019 January 11320 10700 22160February 11185 10005 12395March 11295 10400 21625
Performance in comparison to broad based indices suchas SampP BSE Sensex
Note - Indicates monthly closing positions
Listing of Shares on Stock Exchange (with Stock Code)BSE Limited (507960)Phiroze Jeejeebhoy Towers Dalal Street Mumbai 400 001Telephone Nos 022-2272 1233 34Facsimile No 022-2272 1919E-mail isbseindiacomWebsite wwwbseindiacom
The Listing Fee for the financial year 2019-20 has beenpaid to BSE Limited
Financial CalendarFinancial Year 2019-20(1st April - 31st March)
1 First Quarter Results July 20192 Second Quarter and October November 2019
Half-Year Results3 Third Quarter Results January February 20204 Fourth Quarter and May 2020
Annual Results
Particulars of past three AGMsAGM Financial Venue Date Time Special
Year ResolutionPassed
36th 2017-18 WelcomHotel 07-08-2018 NoneVadodara
35th 2016-17 R C Dutt Road 08-08-2017 1100 NoneAlkapuri am
34th 2015-16 Vadodara 20-09-2016 None390 007
Postal Ballot
No special resolution requiring postal ballot was eitherproposed last year or is being proposed for the ensuing AGM
SHAREHOLDER REFERENCER
Transfer of Shares in certificate form
Effective 1st April 2019 transfer of shares of a listedcompany can only be effected in dematerialised form interms of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 Shareholders holdingshares in the certificate form are therefore requested todematerialise their shares in their own interestCommunication in this respect has been sent by theCompany during the year to the concerned ShareholdersHowever transfer deeds which were lodged with theCompany on or before 31st March 2019 but were returneddue to any deficiency will be processed upon re-lodgement
Transfer of Dividend and corresponding Equity Shares tothe Investor Education and Protection Fund (IEPF)
During the financial year 2018-19 unclaimed dividend forthe financial year 2010-11 aggregating ` 636444- andthe corresponding 13150 Equity Shares in respect of whichdividend entitlements remained unclaimed for sevenconsecutive years or more have been transferred by theCompany to the IEPF established by the CentralGovernment pursuant to the provisions of Section 124 ofthe Companies Act 2013 read with the Investor Educationand Protection Fund Authority (Accounting Audit Transferand Refund) Rules 2016
Shareholders may claim their unclaimed dividend for theyears prior to and including the financial year 2010-11 andthe corresponding shares from the IEPF Authority byapplying in the prescribed Form No IEPF-5 This Form canbe downloaded from the website of the IEPF Authoritywwwiepfgovin the access link of which is also availableon the Companys website wwwgujarathotelsltdin underthe section General Information under Shareholder Value
The unclaimed dividend for the undernoted years and thecorresponding shares will be transferred by the Companyto the IEPF in accordance with the schedule given belowAttention in particular is drawn that the unclaimed dividendfor the financial year 2011-12 and the corresponding shareswill be due for transfer to the IEPF on 14th September
SHAREHOLDER INFORMATION
19
Central Depository Services (India) LimitedMarathon Futurex A Wing 25th FloorMafatlal Mill Compound N M Joshi MargLower Parel Mumbai 400 013Telephone No 022-2302 3333Facsimile No 022-2300 2035E-mail helpdeskcdslindiacomWebsite wwwcdslindiacomRemittance of Dividend through Electronic ModeThe Company provides the facility for remittance of dividendto Shareholders through RTGS (Real Time GrossSettlement) NACH (National Automated Clearing House) NEFT (National Electronic Funds Transfer)
Shareholders who have not opted for remittance of dividendthrough electronic mode and wish to avail the same arerequired to provide their bank details including IFSC (IndianFinancial System Code) and MICR (Magnetic Ink CharacterRecognition) to their respective Depository Participants(DPs) or to the RTA where shares are held in thedematerialised form and in the certificate form respectively
Shareholders holding shares in the certificate form mayuse the Mandate Form for this purpose which can bedownloaded from the Companys websitewwwgujarathotelsltdin under the section GeneralInformation under Shareholder Value
Address and Bank DetailsShareholders holding shares in the certificate form arerequested to advise the RTA of any change in their address mandate bank details to facilitate better servicingShareholders are advised that as a measure of protectionagainst fraudulent encashment their bank details oraddress as available with the RTA will be printed on thedividend warrants or demand drafts where dividend cannotbe remitted through electronic mode
Permanent Account Number (PAN)Shareholders holding shares in the certificate form arerequested to send copies of their PAN Cards to the RTA tofacilitate better servicing
Furnishing of PAN Card however is mandatory as followsi) Transferees and Transferors PAN Cards for transfer
of sharesii) Legal heirs Nominees PAN Cards for transmission
of sharesiii) Surviving joint holders PAN Cards for deletion of name
of deceased Shareholders andiv) Joint holders PAN Cards for transposition of shares
Nomination Facility
Shareholders who hold shares in the certificate form andwish to make any nomination change nomination madeearlier in respect of their shareholding in the Companyshould submit to the RTA the prescribed Form such Formcan be downloaded from the Companys website underthe section Investor Relations under Shareholder Value
SHAREHOLDER INFORMATION
2019 for which purpose communication has been sent tothe concerned Shareholders advising them to write to theCompany to claim their dividend Notices in this regardhave also been published in newspapers Details of suchunclaimed dividend and corresponding shares areavailable on the Companys website under the sectionGeneral Information under Shareholder Value
Financial Date of declaration Due date for transferYear of Dividend to IEPF2011-12 8th August 2012 14th September 2019
2012-13 13th August 2013 19th September 2020
2013-14 29th September 2014 5th November 2021
2014-15 29th September2015 5th November 2022
2015-16 20th September 2016 26th October 2023
2016-17 8th August 2017 14th September 2024
2017-18 7th August 2018 12th September 2025
The Company will not be able to entertain any claim receivedafter 12th September 2019
Shareholders who have not so far encashed their dividendwarrant(s) or have not received the same are requested toapply for duplicate warrant(s) by writing to the Companyand confirming non-encashment non-receipt of dividendwarrant(s)
Service of Documents
The Company sends Notices Report and Accounts andother communications in electronic mode to thoseShareholders who have registered their e-mail addresseswith the Company or with the Depositories and in physicalmode to the other Shareholders
Shareholders who wish to register or update their e-mailaddresses with the Company may use the Form forregistration updation which can be downloaded from theCompanys website under the section Investor Relationsunder Shareholder Value
Depository Services
Shareholders may write to the respective Depository or tothe RTA for guidance on depository services
The contact details of the Depositories are given below
National Securities Depository LimitedTrade World A Wing 4th FloorKamala Mills CompoundSenapati Bapat Marg Lower ParelMumbai 400 013Telephone No 022-2499 4200Facsimile No 022-2497 6351E-mail infonsdlcoinWebsite wwwnsdlcoin
20
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
FOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019Your Directors submit their Report for the financial yearended 31st March 2019
BUSINESS ENVIRONMENT
The global economic growth softened to 36 in 2018representing a marked slowdown compared to the 39growth anticipated at the beginning of the year buoyed bya strong fiscal expansion in the USA which was offset largelyby slower growth in some other large economies ieEurope Japan etc Going forward global growth in 2019 isprojected to decline further to 33 in the base case withrisks to the downside emanating from politicaluncertainties rising trade tensions escalatingprotectionism and tighter financial conditions
As per Ministry of Statistics amp Programme Implementation(MSPI) Indian economy registered the GDP growth of 7in 2018-19 as compared to 72 in 2017-18 The economyis expected to grow and maintain a level of 75 in 2019and 2020 as per the World Bank estimates
India is the most digitally-advanced traveller nation in termsof digital tools being used for planning booking andexperiencing a journey During 2018 foreign tourist arrivals(FTAs) in India stood at 1056 million achieving a growthrate of 52 year-on-year The Government of India is alsoworking to achieve 1 share in worldrsquos international touristarrivals by 2020 and 2 share by 2025
The operating environment in the hospitality sector showedimprovement with foreign tourist arrivals Indiarsquos risingmiddle class and increasing disposable incomes havecontinued to support the growth of domestic tourism
With the inauguration of Statue of Sardar Vallabhbhai Patelalso known as lsquoStatute of Unityrsquo which is the higheststanding statue in the world at a height of 182 meters thetourism in the city of Vadodara is expected to grow
FINANCIAL PERFORMANCE
During the year under review your Company earned licensefees of ` 36987 lakhs (previous year ` 33098 lakhs)Theother income at ` 19626 lakhs showed an increase mainlydue to improvement in return on current investment Preand post-tax profits increased to ` 51822 lakhs (previousyear ` 45313 lakhs) and ` 40788 lakhs (previous year` 33690 lakhs) respectively
Your Directors are pleased to recommend a dividend of` 350 per Equity Share of ` 10- each for the year ended31st March 2019 thereby maintaining last yearrsquos dividendand involving a cash outflow of ` 160 lakhs includingDividend Distribution Tax of ` 27 Lakhs
PROFITS DIVIDEND AND RETAINED EARNINGS
The financial results of your Company summarised areas under
For the year ended For the year ended31st March 2019 31st March 2018
Profits (` ) (` )
a Profit Before Tax 51822363 45312928
b Tax Expense
Current Tax 11653499 9272310Deferred Tax (618755) 2350502
c Profit for the year 40787619 33690116
d Other Comprehensive Income - -
e Total Comprehensive Income 40787619 33690116
Statement of Retained Earningsa At the beginning of the year 213211090 195873461
b Add Total Comprehensive Income 40787619 33690116
c Less Dividend paid including IncomeTax on Dividend paid 15981176 15954974
d Less Income Tax on Dividend paid forearlier year - 397513
e At the end of the year 238017533 213211090
Your Directors are pleased to recommend a dividend of` 350 per Equity Share (Previous Year ` 350) of ` 10-each for the year ended 31st March 2019
Details of changes in Key Financial Ratio amp Return onNet Worth
The key financial ratio of the Company where there hasbeen significant change (25 or more) and change inReturn on Net Worth are summarized below pursuant toSchedule V (B) to the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements)Regulations 2015 (Listing Regulations 2015)
HOTEL OPERATIONS
Your Hotel WelcomHotel Vadodara licensed to ITC Limitedrecorded an income of ` 249443 lakhs during the year ascompared to ` 221856 lakhs in the previous year Therewas an improvement in both occupancy and average roomrates leading to an overall improvement in HotelPerformance
Financial Ratio
2018-19 2017-18 Change
Reason for change
Current Ratio
278 223 25 Increase in value of current investment based on accumulation of market return and fresh investment done during the year out of surplus funds
Return on Net Worth
133 120 11 Due to higher rate of growth in profit after tax
21
The Food amp Beverage segment of your Companyrsquos Hotelcontinues to be a major strength The Peshawri Restaurantand the Welcom Cafeacute Cambay both retained their premiumleadership positions
Your Company has filed a writ petition in the Gujarat HighCourt seeking that the Gujarat State Government be directedto take action on your Companyrsquos application to have theleasehold land of the Hotel converted to freehold andtransferred to your Company as per the existing governmentpolicy in this regard The Honourable High Court passedan Order on 24th December 2014 restraining the StateGovernment from disturbing the peaceful and actualpossession of the Company over the hotel property in anymanner including construction thereon The writ petition ispending
Your Company is also making all efforts for expeditiousconversion of land from leasehold to freehold or in thealternative extension of Lease For further details pleaserefer to Note no 20A of the Accounts
SUBSIDIARIES ASSOCIATES AND JOINT VENTURES
The Company does not have any subsidiary associate orjoint venture
INTERNAL FINANCIAL CONTROLS
Your Company is managed by the Board of Directors andthe Executive Management with clearly defined rolesresponsibilities and authorities The Executive Managementis responsible for the day-to-day conduct of the affairs ofthe Company within the overall framework approved by theBoard Your Company also has a Code of Conduct whichrequires management to conform to the required financialand accounting policies systems and processes conductbusiness ethically and ensure strict compliance with allapplicable laws and regulations Ongoing ReviewProcesses and the Risk Management Framework create acontrol environment in the Company and provide thecornerstones for Internal Financial Controls with referenceto your Companyrsquos Financial Statements
Your Companyrsquos Financial Statements are prepared on thebasis of the Significant Accounting Policies that are carefullyselected by the management and approved by the AuditCommittee and the Board These Policies are reviewedand updated from time to time and audited by the InternalAuditor whose findings and recommendations are reviewedby the Audit Committee and tracked through toimplementation
Your Company maintains its Books of Account in electronicform Your Company has in place adequate internalfinancial controls with reference to the FinancialStatements
The Internal Auditors of the Company evaluates theadequacy and efficacy of such internal financial controlsSuch controls have been assessed during the year by the
management Based on the results of this assessmentno reportable material weakness or significant deficienciesin the design or operation of internal financial controls wereobserved Nonetheless your Company recognises that anyinternal financial control framework no matter how welldesigned has inherent limitations and accordingly regularaudit and review processes ensure that such systems arereinforced on an ongoing basis
RISK MANAGEMENT
Your Company continues its emphasis on a systems-basedapproach to business risk managementBacked by stronginternal control systems the current Risk Managementframework consists of the following key elements
- The Board of Directors (lsquoThe Boardrsquo) has clearly laiddown the roles and responsibilities of the Company inrelation to risk management covering a range ofresponsibilities from strategic to operational Theserole definitions provide the foundation for yourCompanyrsquos Risk Management Policy that is endorsedby the Board and is aimed at ensuring formulation ofappropriate risk management procedures theireffective implementation and independent monitoringand reporting by Internal Audit
- Management of risks vest with the ExecutiveManagement which is responsible for the day-to-dayconduct of the affairs of the Company within the overallframework approved by the Board
- A combination of policies and procedures which areregularly reviewed and updated in the light of changingbusiness and regulatory environment bringsrobustness to the process of ensuring that businessrisks are effectively addressed
- Appropriate structures are in place to proactivelymonitor and manage the inherent risks in businesswith unique relatively high risk profiles
- An Independent Internal Audit Firm carries out riskfocused audits enabling identification of areas whererisk management processes may need to bestrengthened
- The Audit Committee of the Board reviews the InternalAudit findings and provides strategic guidance oninternal controls The Chief Executive Officer closelymonitors the internal control environment within yourCompany including implementation of the action plansemerging out of internal audit findings
The combination of policies and processes as outlinedabove adequately address the various risks associatedwith your Companyrsquos business
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
22
AUDIT AND SYSTEMS
Your Company believes that internal control is a necessaryadjunct to the principle of governance that freedom ofmanagement should be exercised within a framework ofappropriate checks and balances Your Company remainscommitted to ensuring an effective internal controlenvironment that provides assurance and comfort on orderlyand efficient conduct of operations security of assetsprevention and detection of frauds errors accuracy andcompleteness of accounting records and timely preparationof reliable financial information
Your Companyrsquos independent and robust Internal Auditprocesses provide assurance on the adequacy andeffectiveness of internal controls compliance withoperating systems internal policies and regulatoryrequirements
The Internal Audit function consisting of an outsourcedprofessional firm is adequately resourced to deliver highstandards of audit assurances
The Audit Committee of your Board met four times duringthe year The Terms of Reference of the Audit Committeeincluded reviewing the adequacy and effectiveness of theinternal control environment monitoring implementationof the action plans emerging out of Internal Audit findingsincluding those relating to strengthening of your Companyrsquosrisk management systems and discharge of statutorymandate
HUMAN RESOURCE DEVELOPMENT
Your Company firmly believes that employees are the vitaland most valuable assets and hence has created afavourable work environment that encourages innovationand meritocracy Your Company continues to innovate inthe way human resources are managed and developedstriking a balance between business needs and individualaspirations
With an undying commitment to render delightful servicesyour Companyrsquos employees consistently work towardsdelivering flawless performance and are continuing todelight customers
The Company provides a safe secure inclusive and genderfriendly workplace The Company has put in placeGrievance Redressal Procedures and adopted a Policy onSexual Harassment as per the provisions of the SexualHarassment of W omen at W orkplace (PreventionProhibition and Redressal) Act 2013 and the Rules framedthereunder The Company has an Internal ComplaintsCommittee to ensure that grievances in this regard if anyare effectively addressed During the year under review nocomplaint relating to sexual harassment has beenreceived
WHISTLEBLOWER POLICY
The Companyrsquos W histleblower Policy encouragesDirectors and employees to bring to the Companyrsquosattention instances of unethical behavior actual orsuspected incidents of fraud actual or suspectedinstances of leak of unpublished price sensitive informationor violation of the GHL Code of Conduct that could adverselyimpact the Companyrsquos operations business performanceand or reputation The Policy provides that the Companyinvestigates such incidents when reported in an impartialmanner and takes appropriate action to ensure that therequisite standards of professional and ethical conductare always upheld It is the Companyrsquos Policy to ensurethat no employee is victimised or harassed for bringingsuch incidents to the attention of the Company
The practice of the Whistleblower Policy is overseen by theAudit Committee and no employee has been denied accessto the Committee The Whistleblower Policy is available onthe Companyrsquos website at httpwwwgujarathotelsltdinCorporateGovernancehtml
DEPOSITS
Your Company has not accepted any deposits from thepublic members under Section 73 of the Companies Act2013 (lsquothe Actrsquo) read with the Companies (Acceptance ofDeposits) Rules 2014 during the year
DIRECTORS
Changes in Directors
Mr R C Mehta stepped down as Non-Executive IndependentDirector of the Company with effect from close of work on31st March 2019 keeping in view the Regulation 17(1A) ofthe Listing Regulations 2015 Your Directors would like torecord their appreciation for the services rendered byMr Mehta
The Board at the meeting held on 15th April 2019 on therecommendation of the Nominations and RemunerationCommittee recommended for the approval of the Membersthe re-appointment of Mr C K Koshy and Mr M Narayananas independent directors of your Company in terms ofSection 149 of the Act and Regulation 17 of the ListingRegulations 2015 with effect from 29th September 2019
Requisite Notices under Section 160 of the Act have beenreceived in respect of Messrs Koshy and Narayanan whohave filed their consents to act as Directors of the Companyif appointed
Appropriate resolutions seeking your approval to theaforesaid appointment will appear in the Notice conveningthe Thirty Seventh AGM of your Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
23
Retirement by Rotation
In accordance with the provisions of Section 152 of the Actread with Article 147 of the Articles of Association of theCompany Mr Jagdish Singh will retire by rotation at theensuing Annual General Meeting (lsquoAGMrsquo) of your Companyand being eligible offers himself for re-election Your Boardrecommends his re-election
Number of Board Meetings
During the year ended 31st March 2019 four meetings ofthe Board were held
Attributes Qualifications amp Independence of Directorsand their Appointment
As reported last year the Nominations and RemunerationCommittee of the Board had approved the criteria fordetermining qualifications positive attributes andindependence of Directors in terms of the Act and the Rulesthereunder both in respect of Independent Directors andother Directors as applicable The criteria inter aliarequires that NonndashExecutive Directors includingIndependent Directors be drawn from amongst eminentprofessionals with experience in business finance law public administration and enterprises
The Board Diversity Policy of the Company requires theBoard to have a balance of skills experience and diversityof perspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the lsquoReport on CorporateGovernancersquo forming part of the Report and Accounts TheArticles of Association of the Company provide that thestrength of the Board shall not be fewer than three normore than twelve
Directors are appointed re-appointed with the approval ofthe Members All Directors other than IndependentDirectors are liable to retire by rotation unless otherwiseapproved by the Members One-third of the Directors whoare liable to retire by rotation retire every year and areeligible for re-election
The Independent Directors of your Company haveconfirmed that (a) they meet the criteria of independenceas prescribed under Section 149 of the Act and Regulation16 of the Listing Regulations 2015 and (b) they are notaware of any circumstance or situation which could impairor impact their ability to discharge duties with an objectiveindependent judgement and without any external influenceFurther in the opinion of the Board the IndependentDirectors fulfil the conditions prescribed under the ListingRegulations 2015 and are independent of the managementof the Company
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpw w wg u j a ra th o te ls l td in p o l i c ies R em u n era t io n -
Policy_GHLpdf There has been no change in the Policyduring the year
Board Evaluation
The Nominations and Remuneration Committee hasapproved the Policy on Board Evaluation Evaluation ofBoard Committeesrsquo functioning and individual DirectorEvaluation and also specified that such evaluation will bedone by the Board Board performance is assessed againstthe role and responsibilities of the Board as provided inthe Act and the Listing Regulations 2015 The parametersfor Board performance evaluation have been derived fromthe Boardrsquos core role of trusteeship to protect and enhanceshareholder value as well as fulfil expectations of otherstakeholders through strategic supervision of the CompanyEvaluation of functioning of Board Committees is basedon discussions amongst Committee members and sharedby each Committee Chairman with the Board IndividualDirectors are evaluated in the context of the role played byeach Director as a member of the Board at its meetingsand in assisting the Board in realising its role of strategicsupervision of the functioning of the Company in pursuit ofits purpose and goals
While the Board evaluated its performance against theparameters laid down by the Nominations andRemuneration Committee the evaluation of individualDirectors was carried out anonymously in order to ensureobjectivity The Board was briefed on functioning of BoardCommittees by the respective Committee Chairmen
Key Managerial Personnel
Mr Deependra Rana resigned as the Chief Executive Officerof the Company with effect from 17th December 2018
The Board at the meeting held on 30th January 2019 onthe recommendation of the Nominations andRemuneration Committee appointed Mr Kunal Pahwa asthe Chief Executive Officer of the Company with effect from1st February 2019
AUDIT COMMITTEE amp AUDITORS
The composition of the Audit Committee is provided underthe section lsquoBoard of Directors amp Committeesrsquo in the Reportand Accounts
Statutory Auditors
The Statutory Auditors Messrs K C Mehta amp Co CharteredAccountants (KCM) were appointed with your approval atthe Thirty Fifth AGM to hold such office till the conclusion ofthe Fortieth AGM
On the recommendation of the Audit Committee the Boardrecommended for the approval of the Members paymentof remuneration of KCM for the financial year 2019-20Appropriate resolution for this purpose will appear in theNotice convening the Thirty Seventh AGM of the Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
24
Secretarial Auditors
Your Board appointed Messrs PB amp Associates CompanySecretaries to conduct the secretarial audit of the Companyfor the financial year ended 31st March 2019 Their Reportis provided in the Annexure forming part of this Report interms of Section 204 of the Act
RELATED PARTY TRANSACTIONS
All contracts or arrangements entered into by the Companywith its related parties during the financial year were inaccordance with the provisions of the Act and the ListingRegulations 2015 All such contracts or arrangements wereentered in the ordinary course of business and on armrsquoslength basis and have been approved by the AuditCommittee
Further the details of related party transactions of theCompany in prescribed Form No AOC-2 in terms of Section134 of the Act read with Rule 8 of the Companies (Accounts)Rules 2014 is given in the Annexure to this Report YourCompanyrsquos Policy on Related Party Transactions asadopted by your Board can be accessed on the website ath t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_Transactionspdf
DIRECTORSrsquo RESPONSIBILITY STATEMENT
As required under Section 134 of the Act your Directorsconfirm having
a) followed in the preparation of the Annual Accounts theapplicable Accounting Standards with properexplanation relating to material departures if any
b) selected such accounting policies and applied themconsistently and made judgements and estimates thatare reasonable and prudent so as to give a true andfair view of the state of affairs of your Company at theend of the financial year and of the profit of yourCompany for that period
c) taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with theprovisions of the Act for safeguarding the assets ofyour Company and for preventing and detecting fraudand other irregularities
d) prepared the Annual Accounts on a going concernbasis
e) laid down internal financial controls to be followed byyour Company and that such internal financial controlswere adequate and operating effectively and
f) devised proper systems to ensure compliance withthe provisions of all applicable laws and that suchsystems were adequate and operating effectively
OTHER INFORMATION
Compliance with the conditions of Corporate Governance
The certificate of the Statutory Auditors Messrs K C Mehtaamp Co Chartered Accountants confirming compliance withthe conditions of Corporate Governance as stipulated underthe Listing Regulations 2015 is annexed
Compliance with Secretarial Standards
The Company is in compliance with the applicableSecretarial Standards issued by the Institute of CompanySecretaries of India and approved by the CentralGovernment under Section 118 of the Act
Cost Records
The Company is not required to maintain cost records interms of Section 148 of the Act read with the Companies(Cost Records and Audit) Rules 2014
Going Concern Status
There is no significant or material order passed during theyear by any regulator court or tribunal impacting the goingconcern status of the Company or its future operations
Extract of Annual Return
The information required under Section 134 of the Act readwith Rule 12 of the Companies (Management andAdministration) Rules 2014 is annexed
Particulars of Loans Guarantees or Investments
During the year ended 31st March 2019 the Company hasneither given any loan or guarantee nor has made anyinvestment under the provisions of Section 186 of the Act
Particulars relating to Conservation of Energy andTechnology Absorption
Particulars as required under Section 134 of the Act relatingto Conservation of Energy and Technology Absorption areprovided below-
Conservation of Energy
Steps taken on conservation of energy and impact thereof
Sl DescriptionNo
1 Installation of energy efficient Gas Burners and Induction Cooker
2 Improvement in energy usage efficiency in lighting system by changingover to efficient lighting solutions such as Light Emitting Diodes
3 Replacement of existing motors and pumps with more energy efficientequipment
4 Process improvement to enhance productivity and reduce specificenergy consumption
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
25
There were no employees who were employed throughoutthe year and were in receipt of remuneration aggregating` 102 crores or more or were employed for part of the yearand were in receipt of remuneration aggregating ` 850lakhs per month or more during the financial year ended31st March 2019
The information pursuant to Section 197 of the Act readwith Rule 5(2) and 5(3) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014containing the names of top 10 employees in terms ofremuneration drawn is provided in the Annexure formingpart of this report
The information required under Section 197(12) of the Actand the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is provided in theAnnexure forming part of this Report
FORWARD-LOOKING STATEMENTS
This Report contains forward-looking statements thatinvolve risks and uncertainties When used in this Reportthe words lsquoanticipatersquo lsquobelieversquo lsquoestimatersquo lsquoexpectrsquo lsquointendrsquolsquowillrsquo and other similar expressions as they relate to theCompany and or its Businesses are intended to identifysuch forward-looking statements The Companyundertakes no obligation to publicly update or revise anyforward-looking statements whether as a result of newinformation future events or otherwise Actual resultsperformances or achievements could differ materially fromthose expressed or implied in such forward-lookingstatements Readers are cautioned not to place unduereliance on these forward-looking statements that speakonly as of their dates This Report should be read inconjunction with the financial statements included hereinand the notes thereto
CONCLUSION
Your Directors and employees look forward to the futurewith confidence and stand committed to creating an evenbrighter future for all stakeholders
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
Steps taken by the Company for utilising alternate sourcesof energy NIL
Capital investment on energy conservation equipment NIL
Technology Absorption
i) Efforts in brief made towards technology absorptionand benefits derived as a result of the above effortseg product improvement cost reduction productdevelopment import substitution etc
Sl Description BenefitsNo
1 Upgradation of Fire Alarm and For Product UpgradationPublic Announcement system
2 Installation of Hoods and Fire For Product UpgradationSuppression system
3 Upgradation of CCTV monitoring For Product Upgradationsystem
4 Upgradation of Electrical Panel For Product Improvement5 Induction of Diesel Generator For Product Improvement
ii) In case of imported technology (imported during thelast 3 years reckoned from the beginning of the financialyear) following information may be furnished
A) Details of technology imported - NIL
B) Year of import - NIL
C) Whether the technology has been fully absorbed -NIL
D) If not fully absorbed areas where absorption hasnot taken place and the reasons therefor - NIL
iii) Expenditure incurred on research and development -NIL
FOREIGN EXCHANGE EARNINGS AND OUTGO
During the financial year 2018-19 foreign exchangeearnings of the Hotel aggregated ` 111754 lakhs (previousyear ` 95887 lakhs) while expenditure in foreign currencyaggregated ` 5514 lakhs (previous year ` 3230 lakhs)
EMPLOYEES
The total number of employees of the Company as on31st March 2019 stood at 198
26
ANNEXURE
FORM NO MR ndash 3SECRETARIAL AUDIT REPORTFOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019[Pursuant to Section 204(1) of the Companies Act 2013 and Rule9 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014]
ToThe MembersGujarat Hotels LimitedWe have conducted the secretarial audit of the compliance ofapplicable statutory provisions and the adherence to goodcorporate practices by Gujarat Hotels Limited a Companyincorporated under the provisions of the Companies Act 1956 andhaving its Registered Office at WelcomHotel Vadodara R C DuttRoad Alkapuri Vadodara Gujarat ndash 390 007 (hereinafter referredto as the lsquoCompanyrsquo) for the period commencing from 1st April2018 till 31st March 2019 (hereinafter referred to as the lsquoAuditPeriodrsquo) Secretarial Audit was conducted in a manner that providedus a reasonable basis for evaluating the corporate conducts statutory compliances and expressing our opinions thereonBased on our verification of the books papers minute booksforms and returns filed and other records maintained by theCompany and also the information provided by the Company itsofficers agents and authorised representatives during the conductof Secretarial Audit 2018-19 we hereby report that in our opinionthe Company has during the audit period covering the FinancialYear ended on 31st March 2019 complied with the statutoryprovisions listed hereunder and also that the Company has properBoard-processes and compliance-mechanism in place to theextent in the manner and subject to the reporting made hereinafterWe have examined the books papers minute books forms andreturns filed and other records maintained by the Company for thefinancial year ended on 31st March 2019 according to theprovisions of(i) The Companies Act 2013 (the Act) and the Rules made
thereunder(ii) The Securities Contracts (Regulation) Act 1956 (lsquoSCRArsquo)
and the Rules made thereunder(iii) The Depositories Act 1996 and the Regulations and
Bye-laws framed thereunder(iv) Foreign Exchange Management Act 1999 and the Rules and
Regulations made thereunder to the extent of Foreign DirectInvestment Overseas Direct Investment and ExternalCommercial Borrowings
(v) The following Regulations and Guidelines prescribed underthe Securities and Exchange Board of India Act 1992(lsquoSEBI Actrsquo)-(a) The Securities and Exchange Board of India
(Substantial Acquisition of Shares and Takeovers)Regulations 2011
(b) The Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations 2015
(c) The Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations2015
(d) The Securities and Exchange Board of India(Registrars to an Issue and Share Transfer Agents)Regulations 1993 regarding the Companies Act anddealing with client
We have also examined compliance with the applicable clauses ofthe following(i) The mandatory Secretarial Standards issued by The Institute
of Company Secretaries of India with respect to BoardMeetings and General Meetings
(ii) The SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015
The Company has entered into an Operating Licence Agreementwith ITC Limited which operates the Hotel ndash WelcomHotel Vadodraand ensure compliance of all laws as applicable for running andmaintenance of the HotelDuring the period under review the Company has complied withthe provisions of the Act Rules Regulations Guidelines andStandards etc as mentioned above however in the CorporateGovernance Report filed pursuant to Regulation 27(2) of SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015with BSE for the quarter ended September and December 2018there is mismatch of date of the meetingWe further report thatThe Board of Directors of the Company is duly constituted withproper balance of Non-Executive Directors and IndependentDirectors The changes in the composition of the Board of Directorsthat took place during the period under review were carried out incompliance with provisions of the ActAdequate notice is given to all Directors for the Board Meetingsand Committees Meetings agenda and detailed notes on agendawere sent at least seven days in advance and where the meetingwas held in shorter notice due compliance was made and a systemexists for seeking and obtaining further information and clarificationson the agenda items before the meeting for meaningful participationat the meetingAll decisions at Board Meetings and Committee Meetings werecarried out unanimously as recorded in the minutes of the meetingsof the Board of Directors or Committees of the Board as the casemay beWe report that there are adequate systems and processes in theCompany commensurate with the size and operations of theCompany to monitor and ensure compliance with the applicableLaws Rules Regulations and GuidelinesWe further report that during the Audit Period the Company has nospecific events actions that have a major bearing on the Companyrsquosaffairs in pursuance of the above referred Laws RulesRegulations Guidelines Standards etc
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
Note This report is to be read with our letter of even date whichis annexed as Annexure A and forms an integral part of thisreport
27
FORM NO AOC-2[Pursuant to Section 134(3)(h) of the Companies Act 2013 and Rule 8(2) of the Companies (Accounts) Rules 2014]
Form for disclosure of particulars of contracts arrangements entered into by the Company with related parties referred to insub-section (1) of Section 188 of the Companies Act 2013 including certain arms length transactions under fourth proviso thereto
1 Details of contracts or arrangements or transactions not at arms length basis
a) Name(s) of the related party and nature of relationshipb) Nature of contracts arrangements transactionsc) Duration of the contracts arrangements transactionsd) Salient terms of the contracts or arrangements or transactions including the value if anye) Justification for entering into such contracts or arrangements or transactions NILf ) Date(s) of approval by the Boardg) Amount paid as advances if anyh) Date on which the special resolution was passed in general meeting as required under first proviso to Section 188
2 Details of material contracts or arrangement or transactions at arms length basis
a) Name(s) of the related party and nature of ITC Limited of which the Company is an Associaterelationship
b) Nature of contracts arrangements transactions Agreement for operating the Companyrsquos Hotel
c) Duration of the contracts arrangements Operating License Agreement (OLA) dated 24th September 1992 for an initialtransactions period of 30 years and renewable for another period of 30 years The OLA
emanated from the rehabilitation package agreed amongst Gujarat State GovtFinancial Institutions viz IFCI amp SBI and ITC in the year 1990
d) Salient terms of the contracts or arrangements The Company receives Licence fees 15 of Net Operating Income Valueor transactions including the value if any of transaction during the year ` 370 crores
e) Date(s) of approval by the Board if any 24th September 1992f ) Amount paid as advances if any Nil
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Annexure AToThe MembersGujarat Hotels Limited
Our report of even date is to be read along with this letter
1 Maintenance of secretarial record is the responsibilityof the management of the Company Our responsibilityis to express an opinion on these secretarial recordsbased on our audit
2 We have followed the audit practices and processesas were appropriate to obtain reasonable assuranceabout the correctness of the contents of the secretarialrecords The verification was done on the randomtest basis to ensure that correct facts are reflected insecretarial records We believe that the processesand practices we followed provide a reasonablebasis for our opinion
3 W e have not verified the correctness andappropriateness of financial records and books ofaccounts of the Company
4 W herever required we have obtained theManagement Representation about the complianceof Laws Rules and Regulations and happening ofevents etc
5 The compliance of the provisions of corporate andother applicable Laws Rules RegulationsStandards is the responsibility of management Ourexamination was limited to the verification ofprocedures on the random test basis
6 The Secretarial Audit Report is neither an assuranceas to the future viability of the Company nor of theefficacy or effectiveness with which the managementhas conducted the affairs of the Company
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
28
INDEPENDENT AUDITORSrsquo CERTIFICATE ON CORPORATE GOVERNANCE
INDEPENDENT AUDITORrsquoS CERTIFICATE ON CORPORATEGOVERNANCE
TO THE MEMBERS OF GUJARAT HOTELS LIMITED
1 We have examined the compliance of conditions ofCorporate Governance by Gujarat Hotels Limited (ldquotheCompanyrdquo) for the year ended on 31st March 2019as stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the Securities and Exchange Board ofIndia (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended(ldquoSEBI Listing Regulationsrdquo)
Managementrsquos Responsibility
2 The compliance of conditions of CorporateGovernance is the responsibility of the ManagementThis responsibility includes the designimplementation and maintenance of internal controland procedures to ensure the compliance with theconditions of the Corporate Governance stipulated inSEBI Listing Regulations
Auditorrsquos Responsibility
3 Our responsibility is limited to examining theprocedures and implementation thereof adopted bythe Company for ensuring the compliance of theconditions of the Corporate Governance It is neitheran audit nor an expression of opinion on the financialstatements of the Company
4 We have examined the books of account and otherrelevant records and documents maintained by theCompany for the purpose of providing reasonableassurance on the compliance with CorporateGovernance requirements by the Company
5 We have carried out an examination of the relevantrecords of the Company in accordance with theGuidance Note on Certification of CorporateGovernance issued by the Institute of CharteredAccountants of India (ldquothe ICAIrdquo) the Standards onAuditing specified under Section 143(10) of theCompanies Act 2013 in so far as applicable for the
purpose of this certificate and as per the GuidanceNote on Reports or Certificates for Special Purposesissued by the ICAI which requires that we comply withthe ethical requirements of the Code of Ethics issuedby the ICAI
6 W e have complied with the relevant applicablerequirements of the Standard on Quality Control (SQC)1 Quality Control for Firms that Perform Audits andReviews of Historical Financial Information and otherAssurance and Related Services Engagements
Opinion
7 Based on our examination of the relevant recordsand according to the information and explanationsprovided to us and representations provided by theManagement we certify that the Company hascomplied with the conditions of Corporate Governanceas stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the SEBI Listing Regulations asapplicable for the year ended 31st March 2019
8 W e state that such compliance is neither anassurance as to the future viability of the Companynor the efficiency or effectiveness with which theManagement has conducted the affairs of theCompany
Restrictions on Use
9 This Certificate is issued solely for the purpose ofcomplying with the aforesaid SEBI ListingRegulations and may not be suitable for any otherpurpose
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
29
ANNEXURE
FORM NO MGT-9EXTRACT OF ANNUAL RETURN
as on the Financial Year ended on 31st March 2019[Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the
Companies (Management and Administration) Rules 2014]
I REGISTRATION AND OTHER DETAILS
i) CIN L55100GJ1982PLC005408ii) Registration Date 7th August 1982iii) Name of the Company Gujarat Hotels Limitediv) Category Sub-Category of the Company Public company - Limited by sharesv) Address of the Registered office and contact details WelcomHotel Vadodara
R C Dutt Road AlkapuriVadodara 390 007Tel No 0265-233 0033E-mail ghlinvestorsyahoocoin
vi) Whether Listed Company Yesvii) Name Address and Contact details of MCS Share Transfer Agent Limited
Registrar and Transfer Agent if any F - 65 Okhla Industrial Area Phase - INew Delhi - 110 020Tel Nos (011) 4140 6149-52 4160 9386
II PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY
III PARTICULARS OF HOLDING SUBSIDIARY AND ASSOCIATE COMPANIES NIL
Sl No
Name and Description of main products services NIC Code of the products services
to total turnover of the Company
1 Hotel Services 55101 100
30
IV SHAREHOLDING PATTERN (Equity Share Capital Break-up as percentage of Total Equity)(i) Category-wise Shareholding
Category of Shareholders No of Shares held at the beginningof the year
No of Shares held at the endof the year
Changeduring the
year
A Promoters(1) Indiana) Individual HUF 0 0 0 0 0 0 0 0 0b) Central Govt 0 0 0 0 0 0 0 0 0c) State Govt(s) 0 0 0 0 0 0 0 0 0d) Bodies Corp 2033963 0 2033963 5370 2033963 0 2033963 5370 0e) Banks FI 0 0 0 0 0 0 0 0 0f ) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(1) 2033963 0 2033963 5370 2033963 0 2033963 5370 0(2) Foreigna) NRIs - Individuals 0 0 0 0 0 0 0 0 0b) Other - Individuals 0 0 0 0 0 0 0 0 0c) Bodies Corp 0 0 0 0 0 0 0 0 0d) Banks FI 0 0 0 0 0 0 0 0 0e) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(2) 0 0 0 0 0 0 0 0 0Total Shareholding of Promoter(A) = (A)(1)+(A)(2) 2033963 0 2033963 5370 2033963 0 2033963 5370 0B Public Shareholding1 Institutionsa) Mutual Funds 0 0 0 0 0 0 0 0 0b) Banks FI 0 100 100 0 100 100 c) Central Govt 0 0 0 0 0 0 0 0 0d) State Govt(s) 0 0 0 0 0 0 0 0 0e) Venture Capital Funds 0 0 0 0 0 0 0 0 0f ) Insurance Companies 0 0 0 0 0 0 0 0 0g) FIIs 10 0 10 0 0 0 h) Foreign Venture Capital Funds 0 0 0 0 0 0 0 0 0i) Others (specify) 0 0 0 0 0 0 0 0 0Sub-total (B)(1) 10 100 110 0 100 100 2 Non-Institutionsa) Bodies Corpi) Indian 300003 2200 302203 798 191626 2100 193726 511 (287)ii) Overseas 0 0 0 0 0 0 0 0 0b) Individualsi) Individual shareholders holding
nominal share capital upto` 1 lakh 774322 231562 1005884 2656 797094 203602 1000696 2643 (013)
ii) Individual shareholders holdingnominal share capital inexcess of ` 1 lakh 220814 0 220814 583 334765 0 334765 884 301
c) Others (specify)i) Non Resident Individuals 44288 71500 115788 306 45662 56700 102362 270 (036)ii) Investor Education and
Protection Fund AuthorityMinistry of Corporate Affairs 108753 0 108753 287 121903 0 121903 322 035
Sub-total (B)(2) 1448180 305262 1753442 4630 1491050 262402 1753452 4630 0Total Public Shareholding(B)=(B)(1)+ (B)(2) 1448190 305362 1753552 4630 1491050 262502 1753552 4630 0C Shares held by Custodian
for GDRs amp ADRs 0 0 0 0 0 0 0 0 0Grand Total (A+B+C) 3482153 305362 3787515 100 3525013 262502 3787515 100 0
Demat Physical Total of TotalShares
Demat Physical Total of TotalShares
ANNEXURE
31
1 Savi Portfolio Management Services LimitedAt the beginning of the year 122218 323Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 122218 323
2 Muktilal Ganulal PaldiwalAt the beginning of the year 82742 218Increase Decrease in Shareholding during the year06042018 220 001 82962 21913042018 250 001 83212 22001062018 927 002 84139 22215062018 700 002 84839 22427072018 412 001 85251 22505102018 1000 003 86251 22830112018 500 001 86751 22931122018 958 003 87709 23218012019 124 000 87833 23208022019 1070 003 88903 23501032019 467 001 89370 23615032019 1000 003 90370 23922032019 200 001 90570 24031032019 50 000 90620 240At the end of the year 90620 240
3 Taradevi Muktilal PaldiwalAt the beginning of the year 31628 084
(ii) Shareholding of Promoters (including Promoter Group)
(iii) Change in Promotersrsquo Shareholding (please specify if there is no change)
SlNo
Shareholders NameNo of
Shares of total
Sharesof the
Company
of Sharespledged
encumbered tototal Shares
No ofShares
of totalShares
of theCompany
of Sharespledged
encumbered tototal Shares
change inShareholding
during the year
1 ITC Limited 1733907 4578 Nil 1733907 4578 Nil Nil
2 Russell Investments Limited 300056 792 Nil 300056 792 Nil Nil
Shareholding at the beginning of the year Shareholding at the end of the year
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
(iv) Shareholding Pattern of top ten Shareholders (other than Directors Promoters and Holders of GDRs and ADRs)
ANNEXURE
No of Shares
Sl No
Particulars Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares of total Shares of the Company
No of Shares of total Shares of the Company
At the beginning of the year
No Change during the year Increase Decrease in Promoters Shareholding during the year
At the end of the year
32
Increase Decrease in Shareholding during the year06042018 180 000 31808 08413042018 53 000 31861 08420042018 1449 004 33310 08827042018 1933 005 35243 09304052018 1060 003 36303 09611052018 2196 006 38499 10218052018 1343 004 39842 10625052018 1191 003 41033 10906072018 1600 004 42633 11313072018 1678 004 44311 11720072018 2095 006 46406 12327072018 3735 010 50141 13303082018 415 001 50556 13410082018 685 002 51241 13624082018 1169 003 52410 13931082018 1616 004 54026 14307092018 1655 004 55681 14714092018 1311 003 56992 15021092018 2480 007 59472 15729092018 2259 006 61731 16305102018 1534 004 63265 16712102018 976 003 64241 17019102018 64 000 64305 17026102018 600 002 64905 17202112018 605 002 65510 17409112018 4 000 65514 17416112018 143 000 65657 17430112018 2299 006 67956 18007122018 515 001 68471 18114122018 10 000 68481 18121122018 590 002 69071 18331122018 600 002 69671 18504012019 1000 003 70671 18825012019 21 000 70692 18801022019 701 002 71393 19008022019 388 001 71781 19115022019 714 002 72495 19301032019 700 002 73195 19515032019 34 000 73229 195At the end of the year 73299 195
4 Shah Viren ShantilalAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 14122018 26965 071
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
ANNEXURE
33
Increase Decrease in Shareholding during theyear ie wef 1412201811012019 28946 076 55911 14701022019 7194 019 63105 166At the end of the year 63105 166
5 Chirayush Pravin VakilAt the beginning of the year 27482 073Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 27482 073
6 Falguni Nilesh DedhiaAt the beginning of the year 18000 048Increase Decrease in Shareholding during the year27042018 5175 014 23175 062At the end of the year 23175 062
7 Classic Realties Private LimitedAt the beginning of the year 23061 061Increase Decrease in Shareholding during the year31082018 100 000 23161 061At the end of the year 23161 061
8 Dheeraj Kumar LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 20000 053
9 Karvy Stock Broking LimitedAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 30112018 23063 061Increase Decrease in Shareholding during theyear ie wef 3011201807122018 149 000 23212 06114122018 (8165) (022) 15047 03931122018 7128 019 22175 05804012019 3087 008 25262 06611012019 (23721) (063) 1541 00331032019 15274 040 16815 043At the end of the year 16815 043 Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company Includes shares acquired during the period when not part of the top ten Shareholders of the Company
10 Sonal LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year20042018 (1000) (003) 19000 050
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
34
311218 0 000 0 00011012019 0 000 0 00031032019 (5000) (013) 14000 037At the end of the year 14000 037 Ceased to be part of the top ten Shareholders of the Company Became a part of the top ten Shareholders of the Company
11 Rajasthan Global Securities Private LimitedAt the beginning of the year 98659 260Increase Decrease in Shareholding during the year20042018 (4756) (013) 93903 24727042018 (5596) (015) 88307 23206072018 (790) (002) 87517 23027072018 (8520) (022) 78997 20802112018 (10975) (029) 68022 17916112018 (4) 000 68018 17930112018 (6189) (016) 61829 16307122018 (170) 000 61659 16314122018 (18503) (049) 43156 11421122018 (417) (001) 42739 11331122018 (11108) (029) 31631 08404012019 (5000) (013) 26631 07111012019 (5000) (013) 21631 05825012019 (2800) (007) 18831 05101022019 0 000 0 000At the end of the year NA NA Ceased to be a part of the top ten Shareholders of the Company
12 Dinesh Mukilal PaldiwalAt the beginning of the year 10522 028Increase Decrease in Shareholding during the year03082018 112 000 10634 02810082018 424 001 11058 02907092018 500 001 11558 03021092018 85 000 11643 03005102018 1000 003 12643 03302112018 0 000 12643 03301022019 0 000 12643 03315022019 300 001 12943 03431032019 0 000 12943 034At the end of the year NA NA Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company
Note Increase decrease in shareholding as indicated above are based on downloads of beneficial ownership provided by the Depositories generally everyFriday
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
35
(v) Shareholding of Directors and Key Managerial Personnel
ANNEXURE
Ms D R Choudhury Messrs C K Koshy R C Mehta M Narayanan and J Singh Directors Messrs M Agarwal andD K Gulati Key Managerial Personnel did not hold any Shares of the Company either at the beginning or at the end of theyear or at any time during the year
Mr K Pahwa Chief Executive Officer also did not hold any Shares of the Company either at the time of his appointment or atthe end of the year or at any time during the year
V INDEBTEDNESSIndebtedness of the Company including interest outstanding accrued but not due for payment NIL
VI REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNELA Remuneration to Managing Director Wholetime Directors and or Manager NOT APPLICABLE
B Remuneration to the other Directors(Amount in `)
Ceased to be Non-Executive Independent Director with close of work on 31st March 2019
Sl No For each of the Director
Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares held singly
jointly
of total Shares of the
Company
No of Shares held singly
jointly
of total Shares of the
Company
1 N Anand (Chairman)
At the beginning of the year 200 0
Increase Decrease in Shareholding during the year
0 0 0 0
At the end of the year 200 0
Sl No Directors
Particulars of Remuneration
Total Amount Fee for attending Board Board
Committee Meetings
Commission Independent Directors
Meeting Fees 1 Independent Directors
C K Koshy 140000 0 10000 150000 R C Mehta 70000 0 0 70000 M Narayanan 140000 0 10000 150000
Total (B)(1) 350000 0 20000 370000 2 Other Non-Executive Directors
N Anand 0 0 0 0 D R Choudhury 0 0 0 0 J Singh 0 0 0 0
Total (B)(2) 0 0 0 0 Total (B) = (B)(1) + (B)(2) 370000 Total Managerial Remuneration (A+B) 370000
Overall ceiling as per the Act (Being 11 of the Net Profits of the Company as calculated under Section 198 of the Companies Act 2013)
3759620
36
C Remuneration to Key Managerial Personnel other than MD Manager WTD(Amount in `)
Mr K Pahwa was appointed as Chief Executive Officer wef 1st February 2019
VII PENALTIES PUNISHMENT COMPOUNDING OF OFFENCES
against the Company Directors and other Officers in Default under the Companies Act 2013 NONE
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Sl No
Particulars of Remuneration Key Managerial Personnel
Total Amount
K Pahwa Chief Executive
Officer
M Agarwal Chief Financial
Officer
D K Gulati Company Secretary
1 Gross Salary
(a) Salary as per provisions contained in Section 17(1) of the Income-tax Act 1961
377472 2883242 880140 4140854
(b) Value of perquisites under Section 17(2) of the Income-tax Act 1961
242908 136154 0 379062
(c) Profits in lieu of salary under Section 17(3) of the Income-tax Act 1961
0 0 0 0
2 Stock Option 0 0 0 0 3 Sweat Equity 0 0 0 0 4 Commission
- as of profit - others specify
0 0 0 0
5 Others please specify 0 0 0 0 Total Amount 620380 3019396 880140 4519916
37
Services reverted to ITC Limited effective 17th December 2018 Reflects revision in remuneration effective 1st October 2018
Notes1 The number of permanent employees as on 31st March 2019 was 1982 Compared to 2017-18 the figures for 2018-19 reflect that
i) Median remuneration of employees - Increased by 965ii) Average remuneration of employees excluding Key Managerial Personnel (KMP) - Increased by 1040 with
increase in number of employeesiii) Remuneration of KMP - Increased by 1321 due to revision in remuneration during the year
3 Remuneration of Directors KMP and other employees is in accordance with the Companys Remuneration Policy
A Information pursuant to Section 197 of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014
Name of Directors ampKey ManagerialPersonnel
Designation Ratio of Remuneration toMedian Remuneration of
all employees
Increase inRemuneration over
LY ()
ANNEXURE
N Anand Non-Executive Chairman - -
D R Choudhury Non-Executive Director - -
C K Koshy Independent Director 0731 7
R C Mehta Independent Director 0341 -
M Narayanan Independent Director 0731 7
J Singh Non-Executive Director - -
D Rana Chief Executive Officer 12681 (15)
K Pahwa Chief Executive Officer (wef 1st February 2019) 3111 -
M Agarwal Chief Financial Officer 15281 24
D K Gulati Company Secretary 4371 8
38
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INFORMATION US 197 OF THE COMPANIES ACT 2013
39
CEO AND CFO COMPLIANCE CERTIFICATE
We Kunal Pahwa Chief Executive Officer and Mayur Agarwal Chief Financial Officer certify that
a) We have reviewed the financial statements including the cash flow statement for the year ended 31st March 2019 andto the best of our knowledge and belief
i) these statements do not contain any materially untrue statement or omit any material fact or contain statementsthat might be misleading
ii) these statements together present a true and fair view of the Companyrsquos affairs and are in compliance with IndianAccounting Standards applicable laws and regulations
b) To the best of our knowledge and belief no transactions entered into by the Company during the year ended31st March 2019 are fraudulent illegal or violative of the Companyrsquos code of conduct
c) We accept responsibility for establishing and maintaining internal controls for financial reporting and we have evaluatedthe effectiveness of the internal control systems of the Company pertaining to financial reporting Deficiencies in thedesign or operation of such internal controls if any of which we are aware have been disclosed to the auditors and theAudit Committee and steps have been taken to rectify these deficiencies
d) i) There has not been any significant change in internal control over financial reporting during the year underreference
ii) The changes in the Significant Accounting Policies arising from the adoption of the Indian Accounting Standardshave been discussed with the auditors and have been approved by the Audit Committee and
iii) We are not aware of any instance during the year of significant fraud with involvement therein of the managementor any employee having a significant role in the Companyrsquos internal control system over financial reporting
Place New Delhi Kunal Pahwa Mayur AgarwalDate 15th April 2019 Chief Executive Officer Chief Financial Officer
40
BALANCE SHEET
As at 31st March 2019Amount in `
Particulars Note As at As at31st March 2019 31st March 2018
ASSETSNon-Current Assetsa) Property Plant and Equipment 2 14695652 15623727b) Other Non-Current Assets 3 6672434 7609451Total Non-Current Assets 21368086 23233178Current Assetsa) Financial Assets
(i) Investments 4 280294894 208482957(ii) Trade Receivables 5 16310661 14154244(iii) Cash and Cash Equivalents 6 763039 900355(iv) Other Bank Balances 7 5489856 53182631(v) Other Financial Assets 8 4724316 6349124
b) Other Current Assets 3 437564 406324Total Current Assets 308020330 283475635Total Assets 329388416 306708813EQUITY AND LIABILITIESEquitya) Equity Share Capital 9 37875150 37875150b) Other Equity 268275037 243468594Total Equity 306150187 281343744LIABILITIESNon-Current Liabilitiesa) Provisions 10 1399224 1270990b) Deferred Tax Liabilities (Net) 11 10745247 11364002Total Non-Current Liabilities 12144471 12634992Current Liabilitiesa) Financial Liabilities
(i) Trade Payablesa) Total outstanding dues of micro enterprises and
small enterprises ndash ndashb) Total outstanding dues of creditors other than
micro enterprises and small enterprises 483074 395920(ii) Other Financial Liabilities 12 9272344 11118126
b) Other Current Liabilities 13 1264039 1172866c) Provisions 10 74301 43165Total Current Liabilities 11093758 12730077Total Equity And Liabilities 329388416 306708813
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
41
STATEMENT OF PROFIT AND LOSS
For the year ended 31st March 2019Amount in `
I Revenue From Operations 14 36986948 33098499
II Other Income 15 19625544 17119109
III Total Income (I+II) 56612492 50217608
IV EXPENSES
Employee Benefits Expense 16 1208580 1094609
Depreciation and Amortization Expense 473636 475984
Other Expenses 17 3107913 3334087
Total Expenses (IV) 4790129 4904680
V Profit Before Tax (III- IV) 51822363 45312928
VI Tax Expense
Current Tax 18 11653499 9272310
Deferred Tax 18 (618755) 2350502
VII Profit for the Year (V-VI) 40787619 33690116
VIII Other Comprehensive Income ndash ndash
IX Total Comprehensive Income for the Year (VII+VIII) 40787619 33690116
X Earnings per Equity Share (Face Value ` 10-each) 19
Basic (in `) 1077 890
Diluted (in `) 1077 890
For the Year For the YearParticulars Note ended ended
31st March 2019 31st March 2018
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
42
For the year ended 31st March 2019
STATEMENT OF CHANGES IN EQUITY
The Board of Directors of the Company recommended a dividend of ` 35 per share (for the year ended 31st March 2018 - dividend ` 350 pershare) be paid on fully paid equity shares This equity dividend is subject to approval by shareholders at the Annual General MeetingThe totalequity dividend to be paid ` 13256303 (for the year ended 31st March 2018 - dividend ` 13256303) Income tax on proposed dividend being` 2724873 (for the year ended 31st March 2018 - ` 2724873)
General Reserve This Reserve is created by an appropriation from one component of equity (generally retained earnings) to another notbeing an item of Other Comprehensive Income The same can be utilized by the Company in accordance with the provisions of the CompaniesAct 2013
Retained Earnings This Reserve represents the cumulative profits of the Company This Reserve can be utilized in accordance with theprovisions of the Companies Act 2013
The accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even dateOn behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
A Equity Share CapitalAmount in `
Balance as at the Changes in equity Balance at thebeginning of the share capital end of the
reporting year during the year reporting yearFor the year ended 31st March 2018 37875150 ndash 37875150For the year ended 31st March 2019 37875150 ndash 37875150
B Other EquityAmount in `
Reserves amp Surplus TotalGeneral Reserve Retained Earnings
Balance as at April 01 2017 30257504 195873461 226130965Total Comprehensive Income for the year ndash 33690116 33690116Dividend ndash 13256303 13256303Income Tax on Dividend Paid ndash 2698671 2698671Dividend Distribution Tax (earlier year) ndash 397513 397513Balance as at March 31 2018 30257504 213211090 243468594Balance as at April 01 2018 30257504 213211090 243468594Total Comprehensive Income for the year ndash 40787619 40787619Dividend ndash 13256303 13256303Income Tax on Dividend Paid 2724873 2724873Balance as at March 31 2019 30257504 238017533 268275037
43
CASH FLOW STATEMENT
For the year ended 31st March 2019
For the Year For the YearParticulars ended ended
31st March 2019 31st March 2018
NOTES1) The above Cash Flow Statement has been prepared under the ldquoIndirect Methodrdquo as set out in Ind AS 7Statement of Cash FlowsrdquoThe accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even date On behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
Amount in `
A Cash Flow from Operating ActivitiesPROFIT BEFORE TAX 51822363 45312928Adjustments for
Depreciation amp Amortisation expense 473636 475984Interest Income (1317822) (3453950)Dividend Income (159984) (178075)Loss on sale of property plant and equipment - Net 445778 (28273)Net gain(loss) on investments mandatorily measuredat fair value through profit or loss (18005340) (13358789)Other Non Operating Income ndash (86856)Other Non Operating Expense ndash 99378
OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 33258631 28782347Adjustments for
Trade Receivables Financial Assets and Other Assets (2815198) (90661)Trade Payables Other Liabilities and Provisions (1568800) 1700052
CASH GENERATED FROM OPERATIONS 28874633 30391738Income Tax Paid(Net) (10407981) (12740273)
NET CASH FROM OPERATING ACTIVITIES 18466652 17651465B Cash Flow from Investing Activities
Sale of Property Plant and Equipment 8661 58452Purchase of Current Investments (224340000) (186220000)SaleRedemption of Current Investments 170532754 183295529Dividend Income 159984 178075Interest Received 3262318 4031382
NET CASH FROM INVESTING ACTIVITIES (50376283) 1343438C Cash Flow from Financing Activities
Dividend Paid (13256303) (13256303)Income Tax on Dividend Paid (2724873) (2698671)
NET CASH FROM FINANCING ACTIVITIES (15981176) (15954974)NET INCREASE IN CASH AND CASH EQUIVALENTS (47890807) 3039929OPENING CASH AND CASH EQUIVALENTS 48653846 45613917CLOSING CASH AND CASH EQUIVALENTS 763039 48653846
CASH AND CASH EQUIVALENTS COMPRISE Cash cheques and current accounts 763039 900355Other Bank BalancesDeposits with original maturity more than 3 months having remainingmaturity less than 12 months from Balance Sheet date ndash 47753491
763039 48653846
44
1 SIGNIFICANT ACCOUNTING POLICIESStatement of ComplianceThese financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) notifiedunder section 133 of the Companies Act 2013 (the Act) read with Companies (Indian Accounting Standards)Rules 2015 (as amended) The financial statements have also been prepared in accordance with the relevantpresentation requirements of the Companies Act 2013
Basis of PreparationThe financial statements are prepared in accordance with the historical cost convention except for certain itemsthat are measured at fair values as explained in the accounting policies below The financial statements arepresented in Indian Rupees (INR) which is also the Companyrsquos functional currency
Fair Value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transactionbetween market participants at the measurement date regardless of whether that price is directly observable orestimated using another valuation technique In estimating the fair value of an asset or a liability the Companytakes into account the characteristics of the asset or liability if market participants would take those characteristicsinto account when pricing the asset or liability at the measurement date
The preparation of financial statements in conformity with Ind AS requires management to make judgementsestimates and assumptions that affect the application of the accounting policies and the reported amounts ofassets and liabilities the disclosure of contingent assets and liabilities at the date of the financial statementsand the reported amounts of revenues and expenses during the year Actual results could differ from those estimatesThe estimates and underlying assumptions are reviewed on an ongoing basis Revisions to accounting estimatesare recognised in the period in which the estimate is revised if the revision affects only that period they arerecognised in the period of the revision and future periods if the revision affects both current and future periods
All assets and liabilities have been classified as current or non-current as per the Companyrsquos normal operatingcycle and other criteria set out in the Schedule III to the Companies Act 2013 and Ind AS 1 ndash Presentation ofFinancial Statements based on the nature of business and the time between the acquisition of assets for processingand their realisation in cash and cash equivalents
Property Plant amp Equipment ndash Tangible AssetsProperty plant amp equipment are stated at cost of acquisition or construction less accumulated depreciation andimpairment if any For this purpose cost includes deemed cost which represents the carrying value of propertyplant and equipment recognised as at 1st April 2015 measured as per the previous GAAP
Cost is inclusive of inward freight duties and taxes and incidental expenses related to acquisition In respect ofmajor projects involving construction related pre-operational expenses form part of the value of assets capitalisedExpenses capitalised also include applicable borrowing costs for qualifying assets if any Subsequent costs areincluded in the assetrsquos carrying amount only when it meets the recognition criteria are met as per componentaccounting The carrying amount of a replaced part is derecognized All other repairs and maintenance are chargedto the statement of Profit amp Loss
An item of property plant and equipment is derecognized upon disposal or when no future economic benefits areexpected to arise from the continued use of asset Any gain or loss arising on the disposal or retirement of an itemof property plant and equipment is determined as the difference between the sales proceeds and the carryingamount of the asset and is recognised in Statement of Profit and Loss
Depreciation of these assets commences when the assets are ready for their intended use which is generally oncommissioning Items of Property Plant and Equipment are depreciated in a manner that depreciates the cost ofthe assets after commissioning (or other amount substituted for cost) less its residual value over their usefullives as specified in Schedule II of the Companies Act 2013 on a straight line basis
Property plant and equipmentrsquosrsquo residual values and useful lives are reviewed at each balance sheet date andchanges if any are treated as changes in accounting estimate
NOTES TO THE FINANCIAL STATEMENTS
45
NOTES TO THE FINANCIAL STATEMENTS
Useful lives of different class of PPE are as follows
Particulars Useful Life as per Schedule IIBuilding 60 Years
Plant and Equipment 15 Years
Furnitures and fixtures 8 years
Office equipment 5 Years
Impairment of AssetsImpairment loss is provided if any to the extent the carrying amount of assets or cash generating units exceedtheir recoverable amount
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amountmay not be recoverable
Recoverable amount is higher of an assetrsquos net selling price and its value in use Value in use is the present valueof estimated future cash flows expected to arise from the continuing use of an asset or cash generating unit andfrom its disposal at the end of its useful life
Impairment losses recognised in prior years are reversed when there is an indication that the impairment lossesrecognised no longer exist or have decreased Such reversals are recognised as an increase in carrying amountsof assets to the extent that it does not exceed the carrying amounts that would have been determined (net ofamortisation or depreciation) had no impairment loss been recognised in previous years
Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodiedin the asset are considered to modify the amortisation period or method as appropriate and are treated aschanges in accounting estimates
Financial instruments Financial Assets and Financial LiabilitiesFinancial assets and financial liabilities are recognized when the Company becomes a party to the contractualprovisions of the relevant instrument Transaction cost that are directly attributable to the acquisition or issue offinancial assets and financial liabilities (other than financial assets and financial liabilities measured at fair valuethrough profit or loss) are added to or deducted from the fair value on initial recognition of financial assets andfinancial liabilities Purchase or sale of financial assets that require delivery of assets within a time frame establishedby regulation or convention in the market place (regular way trades) are recognized on the trade date ie the datewhen the Company commits to purchase or sell the asset
Financial AssetsRecognition Financial assets includes Investments Trade receivable Advances Security Deposits Cash andcash equivalents Such Assets are initially recognized at transaction price when the company becomes party tocontractual obligations The transaction price includes transaction cost unless the assets is being fair valuedthrough the Statement of Profit and Loss
Classification Management determines the classification of an asset at initial recognition depending on thepurpose for which the assets were acquired The subsequent measurement of financial assets depends on suchclassification
Financial assets are classified as those measured at
(a) Amortised cost where the financial assets are held solely for collection of cash flows arising from payments ofprincipal and or interest
(b) Fair value through other comprehensive income (FVTOCI) where the financial assets are held not only forcollection of cash flows arising from payments of principal and interest but also from the sale of such assetsSuch assets are subsequently measured at fair value with unrealised gains and losses arising from changesin the fair value being recognised in other comprehensive income
46
NOTES TO THE FINANCIAL STATEMENTS
(c) Fair value through profit or loss (FVTPL) where the assets are managed in accordance with an approvedinvestment strategy that triggers purchase and sale decision based on fair value of such assets Such assetsare subsequently measured at fair value with unrealized gain and losses arising from changes in the fair valuebeing recognised in the Statement of Profit and Loss in the period in which they arise
Trade receivable Advances Security Deposits Cash and Cash equivalents etc are classified for measurementat amortised cost while Investment have been classified for measurement at Fair value through profit or loss(FVTPL)
Impairment The Company assesses at each reporting date whether a financial asset (or group of financialassets) such as investment trade receivable advances and security deposit held at amortised cost are tested forimpairment based on evidence or information that is available without undue cost or effort Expected credit lossesare assessed and loss allowances recognized if the credit quality of the financial asset has deteriorated significantlysince initial recognition
Reclassification When and only when the business model is changed the Company shall reclassify all affectedfinancial assets prospectively from the reclassification date as subsequently measured at amortised cost fairvalue through profit or loss without restating the previously recognized gains or losses and in terms of thereclassification principles laid down in the Ind AS relating to Financial Instruments
De-recognition Financial assets are derecognized when the rights to receive benefits have expired or beentransferred and the Company has transferred substantially all risks and rewards of ownership of such financialasset
Financial LiabilitiesTrade payables and other financial liabilities are initially recognized at the value of the respective contractualobligations They are subsequently measured at amortised cost
Financial liabilities are derecognized when the liability is extinguished that is when the contractual obligation isdischarged cancelled or expires
Offsetting Financial InstrumentsFinancial assets and liabilities are offset and the net amount is included in the Balance Sheet where there is alegally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis orrealise the asset and settle the liability simultaneously
Revenue1 Revenue is measured at the fair value of the consideration received or receivable for services rendered net of
discounts to customers and excludes taxes such as Goods and Services Tax Revenue from the sale ofservices is recognised when the Company performs its obligations to its customers and the amount of revenuecan be measured reliably and recovery of the consideration is probable Income from operating license fees arerecognized on accrual basis in accordance with Operating License agreement The timing of such revenuerecognition is in the periods in which such services are rendered
2 Interest Income is booked in the Statement of Profit and Loss using the effective interest method
3 Dividend Income is recognised in the Statement of Profit and Loss when the right to receive dividend is established
Employee BenefitsThe Company makes contributions to both defined benefit and defined contribution schemes
Contributions to Provident Fund are in the nature of defined contribution scheme and such paidpayable amountsare charged against revenue The contributions in respect of provident fund and family pension are statutorilydeposited with the Government
The Company also makes contribution to defined benefit gratuity plan The cost of providing benefits under thedefined benefit obligation is calculated by independent actuary using the projected unit credit method The Companyhas taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liability with respect to the
47
NOTES TO THE FINANCIAL STATEMENTS
employees and the premium paid to LIC is charged to Statement of Profit amp Loss The difference between theactuarial valuation of the gratuity with respect to employees at the year-end and the contribution paid to LIC isfurther adjusted in the books of accounts
Employees Benefit wrt Leave Encashment is considered as Employees Long Term Benefit for which the Companyrecords the liability based on actuarial valuation computed under projected unit credit method These benefits areunfunded
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee as per the Operating LicenseAgreement
Taxes on IncomeTaxes on income comprises of current tax and deferred tax Current tax in the Statement of Profit and Loss isprovided as the amount of tax payable in respect of taxable income for the period using tax rates and tax lawsenacted during the period together with any adjustment to tax payable in respect of previous years
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities andthe amounts used for taxation purposes (tax base) at the tax rates and tax laws enacted or substantively enactedby the end of the reporting period
Deferred tax assets are recognized for the future tax consequences to the extent it is probable that future taxableprofits will be available against which the deductible temporary differences can be utilized
Deferred tax assets and liabilities are offset when there is legally enforceable right to offset current tax assets andliabilities and when the deferred tax balances relate to the same taxation authority Current tax assets and taxliabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on netbasis or to realize the asset and settle the liability simultaneously
Dividend DistributionDividends paid (including income tax thereon) is recognised in the financial statements in the period in which inwhich the interim dividends are approved by the Board of Directors or in respect of the Companyrsquos final dividendfor the year when the same are approved by shareholders of the Company
Provisions and Contingent LiabilitiesProvisions are recognized when the Company has a present obligation (legal or constructive) as a result of a pastevent it is probable that an outflow of resources will be required to settle the obligation and the amount can bereliably estimated The amount so recognized is the best estimate of the consideration required to settle theobligation at the reporting date taking in to account the risks and uncertainties surrounding the obligation Adisclosure for a contingent liability is made when there is possible obligation or a present obligation that may butprobably will not require an outflow of resources Where there is possible obligation or a present obligation inrespect of which the likelihood of outflow of resources is remote no provision or disclosure is made
Use of Estimates and JudgementsThe key estimates and assumption used in the preparation of financial statements are set out below
Actuarial ValuationThe determination of Companyrsquos liability towards defined benefit obligation to employees is made through independentactuarial valuation including determination of amounts to be recognized in the Statement of Profit and Loss and inother comprehensive income Such valuation depend upon assumptions determined after taking into accountinflation seniority promotion and other relevant factors such as supply and demand factors in the employmentmarket Information about such valuation is provided in notes to the financial statements
ComparativesWhen required by Ind AS comparative figures have been adjusted to conform to changes in presentation for thecurrent financial year
48
2P
rope
rty
Pla
nt a
nd E
quip
men
tA
mou
nt i
n `
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
Gros
s Bl
ock
Depr
eciat
on
Amor
tisati
onNe
t Blo
ck
Parti
cula
rsWi
thdraw
alWi
thdraw
alWi
thdraw
alWi
thdraw
alAp
ril 1
and
Marc
h 31
an
dMa
rch
31
April
1Fo
r the
and
March
31
For t
hean
dMa
rch
31
Marc
h 31
Ma
rch
31
2017
Addi
tions
Adjus
tmen
t20
18Ad
ditio
nsAd
justm
ent
2019
2017
year
Adjus
tmen
t20
18ye
arAd
justm
ent
2019
2019
2018
Tang
ible
Ass
ets
Build
ing
161
88
565
-16
188
565
-2
668
831
592
168
29
561
564
759
84-1
432
140
473
636
290
5518
76
721
140
44
961
147
56
425
Plan
t and
Equ
ipmen
t7
637
0120
716
742
985
-2
047
935
381
92-
--
--
--
538
192
742
985
Furn
iture
and
Fixt
ures
1
278
845
584
122
300
-11
818
110
482
--
--
--
-1
104
821
223
00
Offic
e Eq
uipme
nt2
017
-2
017
--
201
7-
--
--
--
201
72
017
Tota
l1
708
216
7-
263
001
705
586
7-
483
494
165
72
373
956
156
475
984
-14
321
404
736
3629
055
187
672
11
469
565
21
562
372
7
Full
y de
prec
iated
ass
ets
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
49
NOTES TO THE FINANCIAL STATEMENTS
Amount in `Particulars As at 31st March 2019 As at 31st March 2018
Current Non-Current Current Non-Current3 OTHER ASSETS
Advances other than capital advancesSecurity Deposit- With Others 2328947 2328947- Statutory Authorities 200000Other Advances (prepaid expenses) 437564 ndash 406324 ndashAdvance Tax (Net of Provisions) 4143487 5280504TOTAL 437564 6672434 406324 7609451
4 Current investments (at fair value through profit or loss unless otherwise stated) Amount in `Sl Investments in Mutual Funds As at 31st March 2019 As at 31st March 2018No
Name of Plan Unquoted Unquoted1 DHFL Pramerica Ultra Short Term Fund Nil (2018 - 1040731248)
Units of ` 1000 each ndash 219455882 ICICI Prudential Banking amp PSU Debt Fund 1124750948 Units
(2018 - 1124750948) of ` 1000 each 23872614 224702743 ICICI Prudential Corporate Bond Fund 1241451718 Units
(2018 - 1241451718) of ` 1000 each 23712100 221226704 UTI Floating Rate Fund Short Term Fund 7749911 Units
(2018-7749911) of ` 100000 each 23474167 218899535 SBI Magnum Instacash Nil Units (2018-3177849) of ` 100000 each ndash 70220186 Aditya Birla Sun Life Floating Rate Fund-Long Term 274475933 Units
(2018-319824542) Units of ` 10000 each 63614941 686675207 Aditya Birla Sunlife Saving Fund 137924934 Units (2018-129174683)
Units of ` 10000 each 51171946 443649348 Kotak Savings Fund 1128273230 Units (2018-Nil) of ` 1000 each 33816154 ndash9 Reliance Liquid Fund 11416769 Units (2018- Nil) of ` 100000 each 51823115 ndash10 ICICI Prudential Liquid Fund 57413509 Units (2018- Nil) of ` 10000 each 8809857 ndash
Aggregate amount of unquoted Investments 280294894 208482957TOTAL 280294894 208482957
Amount in `As at As at
31st March 2019 31st March 20185 TRADE RECEIVABLES
Unsecured Considered Good 16310661 14154244TOTAL 16310661 14154244
6 CASH AND CASH EQUIVALENTS Balances with Banks
Current Accounts 760024 900355Cash on Hand 3015 ndashTOTAL 763039 900355 Cash and cash equivalents include cash on hand cheques drafts on hand cash at bank and deposits with banks with original maturityof 3 months or less
7 OTHER BANKS BALANCESEarmarked balances 5489856 5429140On Deposit Accounts ndash 47753491TOTAL 5489856 53182631
Represents deposits with original maturity of more than 3 months having remaining maturity of less than 12 months from the Balance Sheet date
50
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
8 OTHER FINANCIAL ASSETSInterest accrued on Deposits 158000 2210348Others - Unsecured considered good 4566316 4138776TOTAL 4724316 6349124
As at As at As at As at31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of ` (No of `
Shares) Shares)9 EQUITY SHARE CAPITAL
AuthorisedEquity Shares of ` 10- each 10000000 100000000 10000000 100000000Issued Subscribed and Paid upEquity Shares of ` 10- each fully paid 3787515 37875150 3787515 37875150
A) Reconciliation of the number of Equity Shares outstanding31st March 31st March
2019 2018As at the beginning of the year 3787515 3787515Add - Shares issued during the year ndash ndashLess -Shares bought back during the year ndash ndashAs at the end of the year 3787515 3787515
B) Shareholders holding more than 5 of the As at As at As at As atEquity Shares in the Company 31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of (No of
Shares) Shares)ITC Limited 1733907 4578 1733907 4578Russell Investments Limited 300056 792 300056 792
C) Rights Preferences and Restrictions attached to the Equity SharesThe Equity Shares of the Company having par value of ` 10 per share rank pari passu in all respects includingvoting rights and entitlement to dividend
D) There are no bonus issue or buy back of equity shares during the period of five years immediately preceding thereporting date
As at 31st March 2019 As at 31st March 2018Current Non-Current Current Non-Current
10 PROVISIONSProvision for Long Term Employee Benefits 74301 1399224 43165 1270990TOTAL 74301 1399224 43165 1270990
51
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
11 DEFERRED TAX LIABILITIES (NET)Deferred Tax Liabilities 10745247 11364002Total 10745247 11364002Movement in Deferred Tax LiabilitiesAssets Balances
For the year 2018-19 Balance as on Recognized in Balance as on1st April 2018 profit or loss 31st March 2019
Deferred Tax Liabilities in relation toOther timing differences
On Depreciation on PPE 4293876 (252926) 4040950On Gain on Investment at FVTPL 7070126 473819 7543945
Total Deferred Tax Liabilities 11364002 220893 11584895Deferred tax liabilities beforeMAT credit entitlement 11364002 220893 11584895Less MAT credit entitlement ndash 839648 839648Total Deferred Tax Liabilities (Net) 11364002 (618755) 10745247
For the year 2017-18 Balance as on Recognized in Balance as on1st April 2017 profit or loss 31st March 2018
Deferred Tax liabilitiesassets in relation toOther timing differences
On Depreciation on PPE 4383618 (89742) 4293876On Gain on Investment at FVTPL 4629882 2440244 7070126
Total Deferred Tax Liabilities (Net) 9013500 2350502 11364002
As at As at31st March 2019 31st March 2018
12 OTHER FINANCIAL LIABILITIES
Unpaid Dividend 5489856 5429140Employee Related 3782488 5688986TOTAL 9272344 11118126
13 OTHER CURRENT LIABILITIES
Statutory Liabilities 1264039 1172866TOTAL 1264039 1172866
52
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 201814 REVENUE FROM OPERATIONS
Operating License Fees 36986948 33098499TOTAL 36986948 33098499
15 OTHER INCOMEInterest Income- Deposit with Banks- Carried At Amortised Cost 1178600 3272160- Deposit Others 139222 181790Dividend Income on Investment measured at FVTPL 159984 178075Net Gain(Loss) on financial assets mandatorily measured at FVTPL 18005340 13358789Net Gain(Loss) on Disposal of Fixed Assets ndash 28273Other Non-Operating Income 142398 100022TOTAL 19625544 17119109
Includes 1120976- (2018 - 681882-) being net gain(loss) on sale of investments
16 EMPLOYEE BENEFITS EXPENSESalaries and Wages 42461991 38590070Contribution to Provident and Other Fund 4564892 3983444
47026883 42573514Less Recoveries madeReimbursements received (45818303) (41478905)TOTAL 1208580 1094609
17 OTHER EXPENSESAdvertising Sales Promotion 159768 158814Consultancy Professional fees 214842 253969Travelling amp Conveyance 810746 1096527Postage Telephone Stationery etc 366042 205049Miscellaneous Expenses 1556515 1619728TOTAL 3107913 3334087Miscellaneous expenses includes Auditors remuneration andexpenses Audit Fees 60000 60000Fees for other services 40000 ndash
18 INCOME TAX EXPENSESA Amount recognised in profit or loss
Current TaxIncome Tax for the Year 11504441 9481109Adjustments(Credits) related to previous year 149058 (208799)Total Current Tax 11653499 9272310Deferred TaxDeferred tax for the year 220893 2350502Mat Credit Entitlement (839648) ndashTotal Deferred Tax (618755) 2350502TOTAL 11034744 11622812
NOTES TO THE FINANCIAL STATEMENTSAmount in `
53
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 2018B Reconciliation of effective tax rate
Profit before tax 51822363 45312928Indian tax rate 2782 2755Income Tax expense calculated at 2782 (2018 2755) 14416981 12484845Effects ofndash Different tax rate on certain items (2922098) (756048)ndash Difference in taxable incomedeductible expense 9697 42609ndash Incomes that are not taxable in determining taxable profit (44508) (49064)Adjustments recognised in the current year in relation toCurrent tax of prior years (425328) (208799)Effect on deferred tax balances due to the change in income tax rate ndash 109269Income Tax recognised in profit or loss 11034744 11622812
The tax rate used for the year 2018-19 and 2017-18 reconciliations above is the corporate tax rate of 25 + surcharge 7 and education cess 4 (2017-18 3) payable on taxable profits under the Income Tax Act 1961
19 EARNINGS PER EQUITY SHAREProfit for the year 40787619 33690116Number of equity shares outstanding 3787515 3787515Basic and diluted earnings per share in (Face value ` 10- per share) 1077 890
20 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTSA The Company was allotted 8200 sq mtrs of land at Vadodara in 1984 and an additional land of 2548 sq mtrs
in 1988 at R C Dutt Road Alkapuri Vadodara through GIIC (Gujarat Industrial Investment Corporation) on sub-lease for a period 30 years on which the hotel Welcomhotel Vadodara was constructed Lease term of landadmeasuring 8200 Sq mtrs expired on 30092014 and of land admeasuring 2548 sq mtrs expired on 30112018
The High Court of Gujarat in pursuance of Writ petition filed by Company in April 2013 passed an Order onDecember 24 2014 restraining the State Government from disturbing the peaceful and actual possession ofthe Company over the hotel property in any manner The writ petition is pending for hearing
The Company have made necessary application to State Government for Conversion of land from Leasehold toFreehold or Extension of Lease which is in process
B There are no Micro Small and Medium Enterprises to whom the Company owes dues which are outstandingfor more than 45 days during the year and also as at 31st March 2019 This information as required to bedisclosed under the Micro Small and Medium Enterprises Development Act 2006 has been determined tothe extent such parties have been identified on the basis of information available with the Company
C The Company operates in one segment ie Hoteliering and within one geographical segment ie India
D Defined Benefit Plan
The Company has taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liabilitywith respect to the employees and the premium paid to LIC is charged to Statement of Profit amp Loss Thedifference between the actuarial valuation of the gratuity with respect to employees at the year-end and thecontribution paid to LIC is further adjusted in the books of accounts
The accounting charge for benefits under the defined benefit obligation is calculated by independent actuaryusing the projected unit credit method
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee (ITC Limited) as per theOperating License Agreement hence no effect on Statement of Profit amp Loss and Other Comprehensive
54
NOTES TO THE FINANCIAL STATEMENTS
Income
Risk ManagementThe defined Benefit Plan expose the company to risk of actuarial deficit arising out of investment risk interestrate risk and salary cost inflation riskInvestment Risks This may arise from volatility in asset values due to market fluctuations and impairment ofassets due to credit losses These Plans primarily invest in debt instruments such as Government securitiesand highly rated corporate bonds ndash the valuation of which is inversely proportional to the interest rate movementsInterest Rate Risk The present value of Defined Benefit Plans liability is determined using the discount ratebased on the market yields prevailing at the end of reporting period on Government bonds A decrease inyields will increase the fund liabilities and vice-versaSalary Cost Inflation Risk The present value of the Defined Benefit Plan liability is calculated with referenceto the future salaries of participants under the Plan Increase in salary due to adverse inflationary pressuresmight lead to higher liabilitiesThese Plans have a relatively balanced mix of investments in order to manage the above risks The investmentstrategy is designed based on the interest rate scenario liquidity needs of the Plans and pattern of investmentas prescribed under various statutes
(Amount in `) Particulars Gratuity 2018-19 2017-18
I Components of Defined Benefit Cost 31-03-2019 31-03-2018 Recognised in Profit or Loss a Current Service Cost 641829 519816 b Past Service Cost ndash
c Net Interest Cost (184109) (72060) Remeasurements a Effect of changes in demographic assumptions (2108) ndash b Effect of changes in financial assumptions ndash (546692) c Effect of experience adjustments (142950) (700483) d (Return) on plan assets (excluding interest income) 24103 110903 e Changes in asset ceiling (excluding interest income) ndash ndash f Total remeasurements included in OCI (169160) (1358078)
Total defined benefit cost recognized in PampL 288560 (910323)I I Net Assets (Liabilities) recognised in Balance Sheet 31-03-2019 31-03-2018
1 Defined Benefit Obligation at end of period 11112243 102978642 Fair value of plan assets at end of period 13058222 120087733 Net defined benefit liability (asset) (1945979) (1710909)
III Change in Defined Benefit Obligation 31-03-2019 31-03-20181 Defined benefit obligation at beginning of period 10297864 111006822 Current service cost 641829 5198163 Interest expenses 755904 7223694 Remeasurements gains (losses)
a Effect of changes in demographic assumptions (2108) ndashb Effect of changes in financial assumptions ndash (546692)c Effect of experience adjustments (142950) (700483)
5 Benefits Paid (438296) (797828)6 Present Value of DBO at end of the year 11112243 10297864
IV Change in Fair Value of Plan Assets 31-03-2019 31-03-20181 Fair value of plan assets at beginning of period 12008773 11529880
55
NOTES TO THE FINANCIAL STATEMENTS
2 Interest income 940012 7944303 Actual Company Contributions 523630 3713884 Benefits Paid (438296) (797828)5 Remeasurements Gains(Losses) on plan assets 24103 1109036 Fair Value of Plan Assets at end of period 13058222 12008773
V Significant Actuarial Assumptions 31-03-2019 31-03-20181 Discount rate () 750 7502 Salary increase rate 70 703 Attrition Rate 20 204 Retirement Age 58 585 Pre-retirement Mortality Indian Assured Indian Assured
Lives Mortality Lives Mortality(2012-14) Ultimate (2006-08) Ultimate
6 Disability Nil NilVI Sensitivity Analysis
The below sensitivity analysis are based on a change in an assumption while holding all other assumptionsconstant In practice this is unlikely to occur and changes in some of the assumptions may be correlatedWhen calculating the sensitivity of the defined benefit obligation to significant actuarial assumptionsthe same method (present value of the defined benefit obligation calculated with the projected unit creditmethod at the end of the reporting period) has been applied as when calculating the defined benefitliability recognised in the balance sheet The methods and types of assumptions used in preparing thesensitivity analysis did not change compared to the prior period
DBO as at DBO as at31-03-2019 31-03-2018
1 Discount rate +100 basis points 10484869 96707062 Discount rate -100 basis points 11804923 109908143 Salary Increase Rate +1 11746789 109364544 Salary Increase Rate -1 10525722 97077345 Attrition Rate +1 11127835 103179616 Attrition Rate -1 11095064 10276102
Maturity Analysis of the Benefit Payments 31-03-2019 31-03-2018 Year 1 804294 399061 Year 2 1117591 769443 Year 3 558914 1211853 Year 4 2204073 512504 Year 5 1303903 2056016 Next 5 years 4323660 4603103
E Amount towards Defined Contribution Plans have been recognized under Contribution to Provident and OtherFunds in Note 16 ` 4564892- (2018 - ` 3983444-)
F The financial statements were approved for issue by the Board of Directors on 15th April 2019G Company has adopted IND As 115 lsquoRevenue from Contracts with Customersrsquo wef 01st April 2018 on prospective
basis and there is no material impact on Financial StatementsH Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Second
Amendment Rules 2019 on 30th March 2019 notifying new Standard Ind AS 116 lsquoLeasesrsquo and otherconsequential amendment in existing Ind As This Ind AS is applicable for annual period beginning on or after01st April 2019 The company is in the process of analysing the impact of such amendment which are notexpected to be material
56
NOTES TO THE FINANCIAL STATEMENTS
21 Financial Instruments and Related DisclosuresI Capital Management
The Company does not have borrowing and aims at maintaining a strong capital base so as to maintain adequatesupply of funds towards future growth plans as a going concern
II Categories of Financial InstrumentsAmount in `
Particulars Note As at As at March 31 2019 March 31 2018
Carrying Fair Carrying FairValue Value Value Value
A Financial Assetsa) Measured at Amortised Cost
i) Cash and cash equivalents 6 763039 763039 900355 900355ii) Other bank balances 7 5489856 5489856 53182631 53182631iii) Trade Receivables 5 16310661 16310661 14154244 14154244iv) Other Financial Assets 8 4724316 4724316 6349124 6349124
Sub - total 27287872 27287872 74586354 74586354 b) Measured at Fair Value through Profit or Loss
i) Investment in mutual funds 4 280294894 280294894 208482957 208482957Sub - total 280294894 280294894 208482957 208482957
Total Financial Assets 307582766 307582766 283069311 283069311B Financial Liabilities
Measured at Amortised Costi) Trade Payables 483074 483074 395920 395920ii) Other Financial Liabilities 12 9272344 9272344 11118126 11118126Total Financial Liabilities 9755418 9755418 11514046 11514046
The carrying amounts of trade payables other financial liabilities cash and cash equivalents other bank balancestrade receivables and other financial assets are considered to be the same as their fair values due to their short termnatureFair value in Mutual fund has been considered as Level 1 as Hierarchy for the same are based on unadjusted pricesin active marketIII Financial Risk Management Objectives
The Company has a system-based approach to risk management anchored to policies and procedures andinternal financial controls aimed at ensuring early identification evaluation and management of key financialrisks (such as market risk credit risk and liquidity risk) that may arise as a consequence of its businessoperations as well as its investing activities Accordingly the Companyrsquos risk management framework has theobjective of ensuring that such risks are managed within acceptable and approved risk parameters in a disciplinedand consistent manner and in compliance with applicable regulation It also seeks to drive accountability in thisregardLiquidity RiskThe company has current assets aggregate to ` 308020330- (2018- ` 283475635) including CurrentInvestments Cash and cash equivalents and Other bank balances of ` 286547789- (2018- ` 262565943-)against an aggregate Current liability of ` 11093758- (2018- ` 12730077-) on the reporting dateFurther whilethe Companyrsquos total equity stands at ` 306150187- (2018- ` 281343744-) and it has no borrowings In suchcircumstances liquidity risk or the risk that the company may not be able to settle or meet its obligations as theybecome due does not existMarket RiskThe company invests in mutual fund schemes of leading fund houses Such investments are susceptible tomarket price risk that arise mainly from changes in interest rate which may impact the return and value of such
57
NOTES TO THE FINANCIAL STATEMENTS
investments However given the relatively short tenure of the underlying portfolio of the mutual fund schemes inwhich the company has invested such price risk is not significantCredit RiskCompanyrsquos deployment in financial instruments such as mutual funds and fixed deposit are made in high qualitypaperscounterparties The company has receivable balances with ITC Limited under the Operating ServiceAgreement which are generally short term in nature Accordingly the Company has concluded that no provisionfor expected credit loss is required
22 Related Party DisclosuresRelated Party Transactionsi) Name of related parties and nature of relationships
ITC Limited of which the Company is an Associateii) Key Management Personnel
Board of DirectorsN Anand Chairman amp Non-Executive DirectorJ Singh Non-Executive DirectorR C Mehta Non-Executive DirectorC K Koshy Non-Executive DirectorM Narayanan Non-Executive DirectorD R Choudhury Non-Executive Director
iii) Summary of transactions during the year Amount in `
Particulars ITC Limited Key ManagementPersonnel
2019 2018 2019 2018License Fees Received 43644599 38834172 ndash ndashPurchase of Services 364514 513635 ndash ndashRemuneration of Managers on Deputation Reimbursed 5916468 5236397 ndash ndashRecoveries of Contractual Remuneration(Including Mangers on Deputation) 53058539 51502148 ndash ndashExpenses Recovered 2168155 2400471 ndash ndashExpenses Reimbursed ndash 44604 ndash ndashDividend Payments 6068675 6068675 700 700Remuneration to Key Management Personnel- Directorrsquos Sitting Fees 370000 350000Balance amount recoverable 20865894 18292750 ndash ndashBalance amount payable ndash ndash ndash ndash
58
TO THE MEMBERS OFGUJARAT HOTELS LIMITED
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying financial statementsof Gujarat Hotels Limited (ldquothe Companyrdquo) which comprisethe Balance Sheet as at 31st March 2019 the Statement ofProfit and Loss including other comprehensive incomeStatement of Changes in Equity and Statement of CashFlows for the year then ended and notes to the financialstatements including a summary of significant accountingpolicies and other explanatory information (hereinafterreferred to as ldquothe financial statementsrdquo)
In our opinion and to the best of our information andaccording to the explanations given to us the aforesaidfinancial statements give the information required by theCompanies Act 2013 (ldquothe Actrdquo) in the manner so requiredand give a true and fair view in conformity with the IndianAccounting Standards specified under section 133 of theAct read with the Companies (Indian Accounting Standards)Rules 2015 as amended (lsquoInd ASrdquo) and other accountingprinciples generally accepted in India of the state of affairsof the Company as at 31 st March 2019 and totalcomprehensive income (comprising of profit and othercomprehensive income) changes in equity and its cashflows for the year ended on that date
Basis for Opinion
We conducted our audit of the financial statements inaccordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act Our responsibilities underthose Standards are further described in the AuditorrsquosResponsibilities for the Audit of the Financial Statementssection of our report We are independent of the Companyin accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financialstatements under the provisions of the Act and the Rulesmade thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements andthe Code of Ethics We believe that the audit evidence wehave obtained is sufficient and appropriate to provide abasis for our audit opinion
Key Audit Matters
Key audit matters are those matters that in our professionaljudgment were of most significance in our audit of thesefinancial statements of the current period These matterswere addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereonand we do not provide a separate opinion on these mattersWe have determined the matters described below to bethe key audit matters to be communicated in our report
INDEPENDENT AUDITORS REPORT
Information Other than the Financial Statements andAuditorrsquos Report Thereon
The Companyrsquos Board of Directors is responsible forpreparation of the other information The other informationcomprises the information included in the Boardrsquos Reportincluding Annexures to Boardrsquos Report ManagementDiscussion and Analysis Report on Corporate Governance
and Shareholderrsquos Information but does not include thefinancial statements and our auditorrsquos report thereon
Our opinion on the financial statements does not cover theother information and we do not express any form ofassurance conclusion thereon
In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing
Sr No
Key Audit Matter How our audit addressed the matter
1 Evaluation of uncertain legal position of leasehold land
(Refer note no 20A to the financial statements)
The lease period of land held by the Company has expired The Company has filed necessary writ petition with High Court of Gujarat in April 2013 which is still pending for adjudication The Company has also made necessary application to State Government for Conversion of land from Leasehold to Freehold or Extension of Lease which is in process This matter being sub-judice essentially involves significant judgement to determine the possible outcome and therefore we have considered it as a key audit matter
We performed the following substantive procedures
Obtained details of application made to State Government Obtained details of writ petition filed to the High Court of
Gujarat and order copy passed by the High Court of Gujarat restraining the State Government from disturbing the actual possession over the property
Obtained details of progress in the matter Discussed the case with the Companyrsquos legal advisor about
the possible outcomes Read the minutes of the board meetings
Based on the procedures described managementrsquos evaluation on the same is acceptable
59
so consider whether the other information is materiallyinconsistent with the financial statements or our knowledgeobtained in the audit or otherwise appears to be materiallymisstated
If based on the work we have performed we conclude thatthere is a material misstatement of this other informationwe are required to report that fact We have nothing to reportin this regard
Responsibilities of Management and Those Charged withGovernance for the Financial Statements
The Companyrsquos Board of Directors is responsible for thematters stated in section 134(5) of the Act with respect tothe preparation of these financial statements that give atrue and fair view of the financial position financialperformance including other comprehensive incomechanges in equity and cash flows of the Company inaccordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards(Ind AS) prescribed under section 133 of the Act
This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company andfor preventing and detecting frauds and other irregularitiesselection and application of appropriate accounting policies making judgments and estimates that are reasonableand prudent and design implementation andmaintenance of adequate internal financial controls thatwere operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to thepreparation and presentation of the financial statementsthat give a true and fair view and are free from materialmisstatement whether due to fraud or error
In preparing the financial statements management isresponsible for assessing the Companyrsquos ability tocontinue as a going concern disclosing as applicablematters related to going concern and using the goingconcern basis of accounting unless management eitherintends to liquidate the Company or to cease operationsor has no realistic alternative but to do so
The Board of Directors is also responsible for overseeingthe Companyrsquos financial reporting process
Auditorrsquos Responsibilities for the Audit of the FinancialStatements
Our objectives are to obtain reasonable assurance aboutwhether the financial statements as a whole are free frommaterial misstatement whether due to fraud or error andto issue an auditorrsquos report that includes our opinionReasonable assurance is a high level of assurance but isnot a guarantee that an audit conducted in accordance withSAs will always detect a material misstatement when itexists Misstatements can arise from fraud or error and areconsidered material if individually or in the aggregate they
could reasonably be expected to influence the economicdecisions of users taken on the basis of these financialstatements
As part of an audit in accordance with SAs we exerciseprofessional judgment and maintain professionalskepticism throughout the audit We also
bull Identify and assess the risks of materialmisstatement of the financial statements whetherdue to fraud or error design and perform auditprocedures responsive to those risks and obtain auditevidence that is sufficient and appropriate to providea basis for our opinion The risk of not detecting amaterial misstatement resulting from fraud is higherthan for one resulting from error as fraud may involvecollusion forgery intentional omissionsmisrepresentations or the override of internal control
bull Obtain an understanding of internal control relevantto the audit in order to design audit procedures thatare appropriate in the circumstances Under section143(3)(i) of the Act we are also responsible forexpressing our opinion on whether the Company hasadequate internal financial controls system in placeand the operating effectiveness of such controls
bull Evaluate the appropriateness of accounting policiesused and the reasonableness of accountingestimates and related disclosures made bymanagement
bull Conclude on the appropriateness of managementrsquosuse of the going concern basis of accounting andbased on the audit evidence obtained whether amaterial uncertainty exists related to events orconditions that may cast significant doubt on theCompanyrsquos ability to continue as a going concern Ifwe conclude that a material uncertainty exists we arerequired to draw attention in our auditorrsquos report tothe related disclosures in the financial statementsor if such disclosures are inadequate to modify ouropinion Our conclusions are based on the auditevidence obtained up to the date of our auditorrsquosreport However future events or conditions maycause the Company to cease to continue as a goingconcern
bull Evaluate the overall presentation structure andcontent of the financial statements including thedisclosures and whether the financial statementsrepresent the underlying transactions and events ina manner that achieves fair presentation
We communicate with those charged with governanceregarding among other matters the planned scope andtiming of the audit and significant audit findings includingany significant deficiencies in internal control that weidentify during our audit
INDEPENDENT AUDITORS REPORT
60
We also provide those charged with governance with astatement that we have complied with relevant ethicalrequirements regarding independence and tocommunicate with them all relationships and other mattersthat may reasonably be thought to bear on ourindependence and where applicable related safeguards
From the matters communicated with those charged withgovernance we determine those matters that were of mostsignificance in the audit of the financial statements of thecurrent year and are therefore the key audit matters Wedescribe these matters in our auditorrsquos report unless lawor regulation precludes public disclosure about the mattersor when in extremely rare circumstances we determinethat a matters should not be communicated in our reportbecause the adverse consequences of doing so wouldreasonably be expected to outweigh the public interestbenefits of such communication
Report on Other Legal and Regulatory Requirements
1 As required by the Companies (Auditorrsquos Report)Order 2016 (ldquothe Orderrdquo) issued by the CentralGovernment of India in terms of sub-section (11) ofsection 143 of the Act we give in ldquoAnnexure Ardquo astatement on the matters specified in paragraphs 3and 4 of the Order to the extent applicable
2 As required by Section 143(3) of the Act we reportthat
a we have sought and obtained all the information andexplanations which to the best of our knowledge andbelief were necessary for the purposes of our audit
b in our opinion proper books of account as requiredby law have been kept by the Company so far as itappears from our examination of those books
c the Balance Sheet the Statement of Profit and lossincluding other comprehensive income the Statementof Changes in Equity and the Statement of Cash Flowsdealt with by this Report are in agreement with thebooks of account
d in our opinion the aforesaid financial statementscomply with the Indian Accounting Standards (Ind AS)prescribed under Section 133 of the Act
e on the basis of the written representations receivedfrom the directors as on 31st March 2019 taken onrecord by the Board of Directors none of the directorsis disqualified as on 31st March 2019 from beingappointed as a director in terms of Section 164(2) ofthe Act
f with respect to the adequacy of the internal financialcontrols with reference to financial statements of theCompany and the operating effectiveness of suchcontrols refer to our separate report in ldquoAnnexure Brdquoand
g with respect to the other matters to be included in theAuditorrsquos Report in accordance with the requirementsof section 197(16) of the Act as amended theCompany has neither paid nor provided for anyremuneration to its directors during the year
h with respect to the other matters to be included in theAuditorrsquos Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules 2014 in ouropinion and to the best of our information andaccording to the explanations given to us
i the Company does not have any pendinglitigations which would impact its financialposition
ii the Company did not have any long-termcontracts including derivative contracts for whichthere were any material foreseeable losses
iii there has been no delay in transferringamounts required to be transferred to theInvestor Education and Protection Fund by theCompany
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
61
ANNEXURE A TO THE INDEPENDENT AUDITORrsquoS REPORT
The annexure referred to in our Independent AuditorrsquosReport to the members of Gujarat Hotels Limited (ldquotheCompanyrdquo) on the financial statements for the year ended31st March 2019 we report that
i (a) The Company has maintained proper recordsshowing full particulars including quantitativedetails and situation of fixed assets
(b) As explained to us the Company has a regularprogram of physical verification of fixed assetswhich in our opinion is reasonable The assetswhich were to be covered as per the saidprogram have been physically verified by themanagement during the year In our opinion andAccording to the information and explanationsgiven to us no material discrepancies werenoticed on such verification
(c) According to the information and explanationsgiven to us and on the basis of our examinationof the records of the Company the title deeds ofimmovable properties are held in the name ofthe Company with respect to land the Companyhas filed a writ petition with Gujarat High Courtseeking that the Gujarat State Government bedirected to take action on Companyrsquosapplication to have the leasehold land of theHotel Converted to freehold and transferred toCompany as per the existing government policyin this regard
ii The Company does not have any inventory andtherefore reporting under clause (ii) of the Order isnot applicable to the Company
iii The Company has not granted any loans secured orunsecured to Companies firms Limited LiabilityPartnerships or other parties covered in the registermaintained under section 189 of the Companies Act2013 and therefore reporting under clause (iii) of theOrder is not applicable to the Company
iv The Company has not given any loans guaranteesor security In respect of the Investments made in ouropinion and according to the information andexplanations given to us the Company has compliedwith the provisions of section 186 of the Act
v According to the information and explanations givento us the Company has not accepted any depositsduring the year from the public within the meaning ofprovisions of section 73 to 76 of the Companies Act2013 and the rules framed thereunder and thereforereporting under clause (v) of the Order is notapplicable to the Company
vi In our opinion and according to the information andexplanations given to us in view of Rule 3 of theCompanies (Cost Records and Audit) AmendmentsRules 2014 the maintenance of cost records undersub-section (1) of section 148 of the Companies Act2013 is not applicable to the Company and thereforereporting under clause (vi) of the Order is notapplicable to the Company
vii (a) According to the information and explanationsgiven to us the Company has been regular indepositing with appropriate authoritiesundisputed statutory dues including providentfund employeersquos state insurance income-taxvalue added tax goods and service tax cessand other statutory dues applicable to it Furtherno undisputed amounts payable in respect ofprovident fund employeersquos state insuranceincome tax value added tax goods and servicetax cess and any other statutory dues were inarrears as at 31st March 2019 for a period ofmore than six months from the date theybecome payable
(b) According to the information and explanationsgiven to us there are no dues of Income taxsales tax value added tax and goods andservice tax which have not been deposited onaccount of any dispute
viii The Company has not taken any loans or borrowingsfrom financial institutions banks and government orhas not issued any debentures and thereforereporting under clause (viii) of the Order is notapplicable to the Company
ix The Company has not raised moneys by way of initialpublic offer or further public offer (including debtinstrument) and term loans during the year andtherefore reporting under clause (ix) of the Order isnot applicable to the Company
x To the best of our knowledge and according toinformation and explanations given to us no materialfraud by the Company or on the Company by its officersor employees has been noticed or reported duringthe course of our audit
xi In our opinion and according to the information andexplanations given to us the Company has not paidor provided any managerial remuneration during theyear and therefore reporting under clause (xi) of theOrder is not applicable to the Company
xii The Company is not a Nidhi company and thereforereporting under clause (xii) of the Order is notapplicable to the Company
INDEPENDENT AUDITORS REPORT
62
xiii In our opinion and according to the information andexplanations given to us and based on ourexamination of the records of the Company alltransactions with the related parties are in compliancewith Section 177 and 188 of the Act where applicableand the details have been disclosed in the financialstatements as required by the applicable accountingstandards
xiv According to the information and explanations givento us the Company has not made any preferentialallotment or private placement of shares or fully orpartly convertible debentures during the year underreview and therefore reporting under clause (xiv) ofthe Order is not applicable to the Company
xv In our opinion and according to the information andexplanations given to us the Company has not
entered into any non-cash transactions with directorsor persons connected with directors and thereforereporting under clause (xv) of the Order is notapplicable to the Company
xvi The Company is not required to be registered undersection 45-IA of the Reserve Bank of India Act 1934
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
63
ANNEXURE ldquoBrdquo TO THE INDEPENDENT AUDITORSrsquo REPORT
(Referred to in paragraph 2(f) under lsquoReport on Other Legaland Regulatory Requirementsrsquo section of our report to theMembers of Gujarat Hotels Limited on the financialstatements of even date)
Report on the Internal Financial Controls with referenceto financial statements under Clause (i) of Sub-section 3of Section 143 of the Act
W e have audited the internal financial controls withreference to financial statements of Gujarat Hotels Limited(ldquothe Companyrdquo) as of 31st March 2019 in conjunction withour audit of the financial statements of the Company for theyear ended on that date
Managementrsquos Responsibility for Internal FinancialControls
The Companyrsquos management is responsible forestablishing and maintaining internal financial controlsbased on the internal control over financial reporting criteriaestablished by the Company considering the essentialcomponents of internal control stated in the Guidance Noteon Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountantsof India (ldquoICAIrdquo) These responsibilities include the designimplementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuringthe orderly and efficient conduct of its business includingadherence to companyrsquos policies the safeguarding of itsassets the prevention and detection of frauds and errorsthe accuracy and completeness of the accounting recordsand the timely preparation of reliable financial informationas required under the Act
Auditorsrsquo Responsibility
Our responsibility is to express an opinion on theCompanyrsquos internal financial controls with reference tofinancial statements based on our audit We conductedour audit in accordance with the Guidance Note on Audit ofInternal Financial Controls over Financial Reporting (theldquoGuidance noterdquo) and the Standards on Auditing issued byICAI and deemed to be prescribed under section 143(10)of the Companies Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the ICAIThose Standards and the Guidance Note require that wecomply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whetheradequate internal financial controls with reference tofinancial statements were established and maintained andif such controls operated effectively in all material respects
Our audit involves performing procedures to obtain auditevidence about the adequacy of the internal financialcontrols with reference to financial statements and their
operating effectiveness Our audit of internal financialcontrols with reference to financial statements includedobtaining an understanding of internal financial controlswith reference to financial statements assessing the riskthat a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal controlbased on the assessed risk The procedures selecteddepend on the auditorrsquos judgement including theassessment of the risks of material misstatement of thefinancial statements whether due to fraud or error
We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our auditopinion on the Companyrsquos internal financial controls withreference to financial statements
Meaning of Internal Financial Controls with reference tofinancial statements
A Companyrsquos internal financial controls with reference tofinancial statements is a process designed to providereasonable assurance regarding the reliability of financialreporting and the preparation of financial statements forexternal purposes in accordance with generally acceptedaccounting principles A Companyrsquos internal financialcontrols with reference to financial statements includesthose policies and procedures that (1) pertain to themaintenance of records that in reasonable detailaccurately and fairly reflect the transactions anddispositions of the assets of the Company (2) providereasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements inaccordance with generally accepted accounting principlesand that receipts and expenditures of the Company arebeing made only in accordance with authorisations ofmanagement and directors of the Company and (3) providereasonable assurance regarding prevention or timelydetection of unauthorised acquisition use or dispositionof the Companyrsquos assets that could have a material effecton the financial statements
Inherent Limitations of Internal Financial Controls withreference to financial statements
Because of the inherent limitations of internal financialcontrols with reference to financial statements includingthe possibility of collusion or improper managementoverride of controls material misstatements due to erroror fraud may occur and not be detected Also projections ofany evaluation of the internal financial controls withreference to financial statements to future periods aresubject to the risk that the internal financial control withreference to financial statements may become inadequatebecause of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate
INDEPENDENT AUDITORS REPORT
64
Opinion
In our opinion the Company has in all material respectsan adequate internal financial controls with reference tofinancial statements and such internal financial controlswith reference to financial statements were operatingeffectively as at 31st March 2019 based on the internalcontrol over financial reporting criteria established by theCompany considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal
INDEPENDENT AUDITORS REPORT
Financial Controls over Financial Reporting issued by theInstitute of Chartered Accountants of India
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
4
NOTES
1 A Member entitled to attend and vote at the AnnualGeneral Meeting (lsquoAGMrsquo) may appoint a proxy toattend and vote on his behalf A proxy need not be aMember of the Company
Proxies in order to be effective must be received atthe Registered Office of the Company not less thanforty-eight hours before the commencement of the AGMie by 1100 am on 5th September 2019
Corporate Members are required to send to theRegistered Office of the Company a certified copy ofthe Board Resolution pursuant to Section 113 of theCompanies Act 2013 (lsquothe Actrsquo) authorising theirrepresentatives to attend and vote at the AGM
2 Explanatory Statement pursuant to Section 102 of theAct relating to the Special Business to be transactedat this AGM is annexed
3 Route map of the AGM venue pursuant to theSecretarial Standard on General Meetings is alsoannexed
4 In terms of Section 108 of the Act read with Rule 20 ofthe Companies (Management and Administration)Rules 2014 the Resolutions for consideration at thisAGM will be transacted through remote e-voting (facilityto cast vote from a place other than the venue of theAGM) for which purpose the Board of Directors of theCompany (lsquothe Boardrsquo) have engaged the services ofCDSL
The facility for voting through ballot paper will beavailable at the AGM venue for those Members who donot cast their votes by remote e-voting prior to the AGMMembers who cast their votes by remote e-voting mayattend the Meeting but will not be entitled to cast theirvotes once again The Board has appointedMr Suresh Kabra (ACS 9711) Partner Messrs SamdaniKabra amp Associates Company Secretaries as theScrutinizer to scrutinize the process of remote e-votingand voting through ballot paper at the AGM venue
5 Voting rights will be reckoned on the paid-up value ofshares registered in the name of the Members on31st August 2019 (cut-off date) Only those Memberswhose names are recorded in the Register ofMembers of the Company or in the Register ofBeneficial Owners maintained by the Depositories ason the cut-off date will be entitled to cast their votes byremote e-voting or voting through ballot paper at theAGM venue A person who is not a Member on thecut-off date should accordingly treat this Notice as forinformation purposes only
6 Unclaimed dividend for the financial year ended31st March 2012 and the corresponding Equity Sharesof the Company in respect of which dividend
entitlements remain unclaimed for seven consecutiveyears will be due for transfer to the Investor Educationand Protection Fund of the Central Government on14th September 2019 pursuant to the provisions ofSection 124 of the Act read with the Investor Educationand Protection Fund Authority (Accounting AuditTransfer and Refund) Rules 2016 Members arerequested to claim the said dividend details of whichare available on the Companyrsquos websitewwwgujarathotelsltdin under the section lsquoGeneralInformationrsquo under lsquoShareholder Valuersquo The Companywill not be able to entertain any claim received after12th September 2019 in respect of the same
7 Members may visit the Companyrsquos website to viewthe Financial Statements or access informationpertaining to the Company Queries if any should besent at least 10 days before the AGM to theChief Financial Officer at the Registered Office of theCompany
8 Members are required to bring their admission slipsto the AGM Duplicate admission slips or copies of theReport and Accounts will not be made available at theAGM venue
9 The procedure with respect to remote e-voting isprovided below
I The period for remote e-voting begins onTuesday 3rd September 2019 at 900 am andends on Friday 6th September 2019 at 500 pmDuring this period Members of the Companyholding shares either in certificate form or indematerialised form as on the cut-off date ie31st August 2019 may cast their voteselectronically The e-voting module shall bedisabled by CDSL for voting thereafter
II The Members should log on to the e-votingwebsite wwwevotingindiacom
III Click on lsquoShareholders MembersrsquoIV Now enter your user ID as under
bull For CDSL 16 digits beneficiary ID
bull For NSDL 8 character DP ID followed by 8digits Client ID
bull Members holding shares in certificate formshould enter Folio Number registered withthe Company
V Thereafter enter the image verification code asdisplayed and Click on lsquoLoginrsquo
VI If you are holding shares in dematerialised formand had logged on to wwwevotingindiacom andcasted your vote earlier for any company thenyour existing password is to be used If you have
5
forgotten the password then enter user ID andthe image verification code and click on forgotpassword amp enter the details as prompted by thesystem
VII If you are a first time user please follow the stepsgiven below
For Members holding shares either in dematerialisedform or in certificate form
PAN Enter your 10 digit alpha-numeric PAN issuedby Income Tax Departmentbull Members who have not updated their
PAN with the Company DepositoryParticipant are requested to use the firsttwo letters of their name and the 8 digitsof the sequence number in the PAN field
bull In case the sequence number is lessthan 8 digits enter the applicable numberof 0rsquos before the number after the firsttwo characters of the name in CAPITALletters Eg If your name is RameshKumar with sequence number I thenenter RA00000001 in the PAN field
Dividend Enter the Dividend Bank Details or Date ofBank Birth (in ddmmyyyy format) as recorded inDetails your demat account or in the CompanyOR records in order to loginDate of bull If both the details are not recorded withBirth the Depository or the Company please
enter your member ID folio number inthe Dividend Bank details field asmentioned in instruction IV
VIII After entering these details appropriately click onlsquoSubmitrsquo
IX Members holding shares in certificate form willthen reach directly to the Companyrsquos selectionscreen
X Members holding shares in dematerialised formwill then reach the lsquoPassword Creationrsquo menuwherein they are required to mandatorily entertheir login password in the new password fieldKindly note that this password can be used forvoting on resolutions of any other company onwhich you are eligible to vote provided that thesaid company opts for e-voting through CDSLplatform It is strongly recommended not to shareyour password with any other person and takeutmost care to keep your password confidential
XI For Members holding shares in certificate formthe details can be used only for e-voting on theResolutions contained in this Notice
XII Click on the EVSN for Gujarat Hotels Limited
XIII On the voting page you will see lsquoResolutionDescriptionrsquo and against the same the optionlsquoYes Norsquo for voting Select the option lsquoYesrsquo or lsquoNorsquoas desired The option lsquoYesrsquo implies that youassent to the Resolution and the option lsquoNorsquoimplies that you dissent to the Resolution
XIV Click on the lsquoResolutions File Linkrsquo if you wish toview the entire Resolution details
XV After selecting the Resolution you have decidedto vote on click on lsquoSubmitrsquo A confirmation boxwill be displayed If you wish to confirm your voteclick on lsquoOkrsquo else to change your vote click onlsquoCancelrsquo and accordingly modify your vote
XVI Once you lsquoConfirmrsquo your vote on the Resolutionyou will not be allowed to modify your vote
XVII You can also take a print of the votes cast byclicking on lsquoClick here to printrsquo option on theVoting page
XVIII Members can also cast their vote using CDSLrsquosmobile app lsquom-Votingrsquo available on Android Appleand Windows based mobiles Members may login to m-Voting using their e-voting credentials tovote on the Company Resolutions
XIX Note for NonndashIndividual Members and Custodians
bull Non-Individuals Members (ie other than HUFIndividuals NRI etc) and Custodians are requiredto log on to wwwevotingindiacom and registerthemselves as Corporates
bull A scanned copy of the Registration Form bearingthe stamp and sign of the entity should be emailedto helpdeskevotingcdslindiacom
bull After receiving the login details user would be ableto link the account(s) for which they wish to voteon
bull The list of accounts linked in the login should bemailed to helpdeskevotingcdslindiacom and onapproval of the accounts they would be able tocast their vote
bull A scanned copy of the Board Resolution and Powerof Attorney (POA) which they have issued in favourof the Custodian if any should be uploaded in PDFformat in the system for the Scrutinizer to verify thesame
XX In case you have any queries or issues regardinge-voting you may refer to the Frequently AskedQuestions and e-voting manual available underthe help section of CDSLrsquos e-voting websitewwwevotingindiacom or write an email tohelpdeskevotingcdslindiacom or contact
6
Mr Rakesh Dalvi at telephone no 18002005533(toll free) You may also address your queries grievances relating to remote e-voting or votingat the meeting to Mr M Agarwal ComplianceOfficer at e-mail ID ghlinvestorsyahoocoin orat telephone no 0265 233 0033
XXI Those who become Members of the Companyafter despatch of the Notice but on or before31st August 2019 (cut-off date) may follow thesteps from Sl Nos II to XIX mentioned above forcasting of vote
XXII General Information
(a) There will be one vote for every Client ID NoRegistered Folio No irrespective of thenumber of joint holders
(b) The Results of voting will be declaredwithin 48 hours from the conclusion of theAGM and the Resolutions will be deemedto be passed on the date of the AGMsubject to receipt of requisite number ofvotes The declared Results along with theScrutinizerrsquos Report will be availableforthwith on the Companyrsquos websitewwwgujarathotelsltdin under the sectionlsquoInvestor Relationsrsquo and on the website ofCDSL such Results will also be forwardedto BSE Limited where the Companyrsquosshares are listed
EXPLANATORY STATEMENT
Annexed to the Notice convening the Thirty Seventh AnnualGeneral Meeting to be held on Saturday 7th September2019
Item No 5
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 28th June 2019 on the recommendationof the Nominations and Remuneration Committee(lsquothe Committeersquo) approved the appointment of Mr MohanSwarup Bhatnagar as Additional Director with effect from28th June 2019 and subject to the approval of the Membersalso as Independent Director of the Company for a periodof five years with effect from the said date in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquotheActrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquothe Listing Regulations2015rsquo)
Mr Bhatnagar (67) is a Science Graduate from St StephenrsquosCollege University of Delhi and is an MBA from the Facultyof Management Studies University of Delhi
Mr Bhatnagar joined ITC Limited (ITC) in 1975 in the HotelsDivision He held various job positions in Finance beforetaking over as the Head of Finance in 1997 withresponsibility for Treasury Audit Purchasing MaterialManagement and Information Technology Subsequentlyhe held charge of Growth and Development for the HotelsBusiness as Executive Vice President He was a memberof the Management Committee of the Division and was onthe Boards of Joint Venture and Subsidiary companies ofITC He retired from ITC in September 2013 Currently heis actively involved in angel investing and in mentoringselect start-up ventures
The Committee and the Board are of the view that theassociation of Mr Bhatnagar and the rich experience hebrings with him would benefit the Company Declarationhas been received from Mr Bhatnagar that he meets thecriteria of Independence prescribed under Section 149 ofthe Act read with the Companies (Appointment andQualification of Directors) Rules 2014 and Regulation 16of the Listing Regulations 2015 In the opinion of your BoardMr Bhatnagar fulfils the conditions specified in the Act theRules thereunder and the Listing Regulations 2015 forappointment as an Independent Director and he isindependent of the management of the CompanyMr Bhatnagar will be entitled to sitting fees for attending themeetings of the Board and its Committees
Requisite Notice under Section 160 of the Act proposingthe appointment of Mr Bhatnagar has been received by theCompany and consent has been filled by Mr Bhatnagarpursuant to Section 152 of the Act
Mr Bhatnagar holds 2500 shares in the Company
Mr Bhatnagar and his relatives are interested in thisResolution None of the other Directors and Key ManagerialPersonnel of the Company or their relatives is interestedin this Resolution
The Board recommends this Resolution for your approval
Item Nos 6 amp 7
The Members of the Company at the Thirty Second AnnualGeneral Meeting held on 29th September 2014 approvedthe appointment of Mr Koshy and Mr M Narayanan asIndependent Directors of the Company for a period of fiveyears with effect from the said date Mr Koshy andMr Narayanan will complete their respective terms on28th September 2019
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 15th April 2019 on the recommendationof the Nominations and Remuneration Committee (lsquotheCommitteersquo) recommended for the approval of theMembers the re-appointment of Mr Koshy andMr Narayanan as Independent Directors of the Companywith effect from 29th September 2019 in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquothe
7
Actrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquoListing Regulations2015rsquo) as set out in the Resolutions relating to theirrespective re-appointment
The Committee and the Board are of the view that giventhe knowledge experience and performance of Mr Koshyand Mr Narayanan and contribution to the Board processesby them their continued association would benefit theCompany Declarations have been received from Mr Koshyand Mr Narayanan that they meet the criteria ofIndependence prescribed under Section 149 of the Act readwith the Companies (Appointment and Qualification ofDirectors) Rules 2014 and Regulation 16 of the ListingRegulations 2015 In the opinion of the Board Mr Koshyand Mr Narayanan fulfil the conditions specified in the Actthe Rules thereunder and the Listing Regulations 2015 forre-appointment as Independent Directors and they areindependent of the management of the Company Mr Koshyand Mr Narayanan will be entitled to sitting fees for attendingmeetings of the Board and its Committees
Consent of the Members by way of Special Resolution isrequired for re-appointment of Mr Koshy and Mr Narayananin terms of Section 149 of the Act Further pursuant toRegulation 17 of the Listing Regulations 2015 consent ofthe Members by way of Special Resolution is also requiredfor continuation of a Non-Executive Director beyond the ageof seventy five years During the proposed term ofre-appointment Mr Koshy and Mr Narayanan will attain theage of seventy five years on 12th February 2020 and1st July 2020 respectively The Special Resolutions under
Item No 6 and 7 once passed shall also be deemed asyour approval under the Listing Regulations 2015 forcontinuation of Mr Koshy and Mr Narayanan as IndependentDirectors beyond the age of seventy five years
Requisite Notices under Section 160 of the Act proposingthe re-appointment of Mr Koshy and Mr Narayanan havebeen received by the Company and consents have beenfiled by Mr Koshy and Mr Narayanan pursuant to Section152 of the Act
Additional information in respect of Mr Koshy andMr Narayanan pursuant to the Listing Regulations 2015and the Secretarial Standard on General Meetings isappearing in the Report and Accounts under the sectionslsquoYour Directorsrsquo and lsquoReport on Corporate GovernancersquoMr Koshy and Mr Narayanan do not hold any share in theCompany either in their individual capacity or on a beneficialbasis for any other person
Mr Koshy and Mr Narayanan and their relatives areinterested in the Special Resolutions relating to theirrespective re-appointment None of the other Directors andKey Managerial Personnel of the Company or theirrelatives is interested in these Special Resolutions
The Board recommends these Special Resolutions for yourapproval
By Order of the BoardGujarat Hotels Limited
Place New Delhi Jagdish SinghDate 15th July 2019 Director
8
ROUTE MAP
AGM VenueWelcomHotel VadodaraR C Dutt Road AlkapuriVadodara 390 007
9
N Anand
Nakul Anand (62) DIN 00022279 a Non-Executive Directorof the Company since 10th March 1998 was appointed asthe Chairman of the Company effective 21st March 2009He is an Executive Director on the Board of ITC Limited andholds responsibility for the Hospitality Travel amp Tourismand Lifestyle Retailing businesses of ITC
An Economics Honours Graduate from the Delhi Universitywith an AMP degree from the Bond University AustraliaAnand joined ITC Hotelsrsquo Management TrainingProgramme in 1978 He has also served as the ManagingDirector of erstwhile ITC Hotels Limited during the period2003-05
In a career that spans close to four decades Anand hasbeen acknowledged in the hotels and tourism industry forhis vision and commitment Leveraging the significantlearning of sustainable excellence within ITC he led theteam at ITC Hotels to pioneer the concept of lsquoResponsibleLuxuryrsquo in the hospitality industry securing LEEDreg Platinumcertifications for all ITC premium luxury hotels He hasformulated value-based strategies to create a uniquequality control model His dynamic leadership and passionfor the business is recognised and acknowledged by hispeers He has been a past President of the HotelAssociation of India and past Chairman of the CII NationalTourism Committee Anand is presently a member of theNational Tourism Advisory Council constituted by theMinistry of Tourism Government of India Chairman of theFederation of Associations in Indian Tourism amp Hospitalityand a Member of the Executive Committee of the HotelAssociation of India He is also a Member of the IndiandashSriLanka CEOs Forum Council Member amp ExecutiveCommittee Member of the National Culture Fund Ministryof Culture Government of India and a Member on the Boardof the International Tourism Partnership
Other Directorships
Name of the company Position
International Travel House Limited Chairman amp Non-Executive Director
Landbase India Limited Chairman amp Non-Executive Director
Fortune Park Hotels Limited Chairman amp Non-Executive Director
WelcomHotels Lanka (Private) Limited Chairman amp Non-Executive Director
Srinivasa Resorts Limited Vice Chairman amp Non-Executive Director
ITC Limited Executive Director
Bay Islands Hotels Limited Non-Executive Director
Maharaja Heritage Resorts Limited Non-Executive Director
Committee Membership of other companies
Name of the Committee Positioncompany
International Travel House Limited Nominations amp MemberRemuneration Committee
Landbase India Limited Audit Committee Member
Fortune Park Hotels Limited Corporate Social ChairmanResponsibility Committee
CK Koshy
Cheruvettolil Kochukoshy Koshy (74) DIN01478704 wasappointed as an Independent Non-Executive Director ofthe Company on 1st May 2007 He is Master of Arts inPolitical Science and Public Administration He joined theIndian Administrative Service in 1968 from the Gujarat Cadreand superannuated in February 2005
In a long career spanning over 38 years he has held severaleminent positions including those of Additional ChiefSecretary - Department of Revenue Industries and MinesTourism and Civil Aviation and Finance and PrincipalSecretary to the Chief Minister He served the Governmentof India as Joint Secretary amp Financial Advisor to theDepartment of Atomic Energy and as Executive Director ofNuclear Power Corporation of India Limited He has heldthe posts of Managing Director of the Tourism Corporationof Gujarat Sardar Sarovar Narmada Nigam Gujarat StateSmall Industries Corporation and Girinar Scooter LimitedHe was also the Joint Managing Director of the GujaratIndustrial Investment Corporation and Chairman of GujaratState Petroleum Corporation Limited Gujarat State PetronetLimited and Gujarat Energy Research and ManagementInstitute
Post retirement he has been a consultant to the Departmentfor International Development - UK the World Bank and tothe Department of Personnel and Administrative ReformsGovt of India He was appointed Professor Emeritus in thefaculty of Planning and Public Policy at CEPT UniversityAhmedabad and is an Advisor to both Indian School ofPetroleum and Energy New Delhi and University ofPetroleum and Energy Studies Dehradun Currently he isAdvisor at CEPT University and on the Board of Trustees ofAlliance Francaise Gujarat and GIAN an NGO whichencourages innovation at the grass root level
Koshy does not hold directorship of any other company
M Narayanan
Mahalinga Narayanan (74) DIN 00159288 was appointedas an Independent Non-Executive Director of the Companyon 10th January 2008 He is a post graduate in CommerceGraduate in Law Diploma Holder in Business Managementand holds certified Associated Membership of the Indian
YOUR DIRECTORS
10
Institute of Bankers He has rich experience of over fourdecades in Banking Project Finance Administration andrelated areas
Narayanan started his career with the Reserve Bank ofIndia in 1964 and moved over to the Bank of Baroda in1969 and continued till March 1985 During his tenure inBank of Baroda he worked in all departments of commercialbanking operation and was in-charge of large branches ofthe Bank In April 1985 he joined Industrial FinanceCorporation of India and held senior managementpositions In October 1997 he joined Tourism FinanceCorporation of India Limited as Managing Director and roseto the position of Chairman and Managing Director whichposition he held till his retirement in September 2006 Hewas conferred with ldquoUdyog Rattan Awardrdquo in the year 2005by the Institute of Economic Studies New Delhi
Other Directorships
Name of the company Position
Cox amp Kings Limited Independent DirectorTulip Star Hotels Limited Independent DirectorRoyale Indian Rail Tours Limited Independent DirectorPride Hotels Limited Chairman amp Independent Director
Committee Membership of other Companies
Name of the company Committee Position
Cox amp Kings Limited Audit Committee ChairmanRemuneration MemberCommittee
Pride Hotels Limited Audit Committee ChairmanRoyale Indian Rail Tours Limited Audit Committee Chairman
Tulip Star Hotels Limited Audit Committee Chairman
J Singh
Jagdish Singh (53) DIN 00042258 was appointed as aNon-Executive Director on the Board of the Company on16th April 2016 A Commerce Graduate and a CharteredAccountant Singh joined ITC Limited in the year 1990During these 26 years he has held various positions inthe finance function He started his career in Treasury andmoved as Corporate Accountant Commercial Manager atCigarette factory at Munger and Head of Finance at ITCEssentra Limited He was then the Head of Treasury
between 2005 and 2015 and is presently the Head ofFinance at ITCrsquos Hotels Division
Other DirectorshipsName of the company Position
International Travel House Limited Non-Executive DirectorFortune Park Hotels Limited Non-Executive DirectorBay Islands Hotels Limited Non-Executive DirectorSrinivasa Resorts Limited Non-Executive DirectorMaharaja Heritage Resorts Limited Non-Executive DirectorMimec (India) Limited Non-Executive DirectorLandbase India Limited Additional Non-Executive DirectorLogix Developers Private Limited Non-Executive Director
Committee Membership of other companiesName of the Committee Positioncompany
International Travel House Limited Stakeholders Relationship MemberCommitteeAudit Committee MemberNominations amp Remuneration MemberCommittee
Fortune Park Hotels Limited Corporate Social MemberResponsibility Committee
Srinivasa Resorts Limited Audit Committee ChairmanCorporate Social MemberResponsibility Committee
D R Choudhury
Devkanya Roy Choudhury (41) DIN 07066556 wasappointed as a Non-Executive Director of the Company on19th January 2015 A Graduate from the National LawSchool of India University Bengaluru she joined ITC Limitedin 2001 As part of Corporate Legal of ITC she has rich andvaried experience in handling legal matters pertaining tovarious divisions including Tobacco Hotels Personal CareLifestyle Retailing Education amp Stationery Paperboards ampSpecialty Papers ITC Infotech as also dealing with mergersamp acquisitions and key litigation across ITC CurrentlyMs Choudhury is the Senior Associate General Counsel ofITC Limited
Other Directorships
Name of the Company Position
WelcomHotels Lanka (Private) Limited Non-Executive Director
YOUR DIRECTORS
Denotes foreign company Denotes listed Indian company whose equity shares or preference shares or debt securities are listed on a recognised
stock exchangeNotes1 Other Directorships and Committee Memberships of Directors are as on 15th April 20192 Committee Memberships cover Committees under the Companies Act 2013 viz Audit Committee Stakeholders
Relationship Committee Nomination and Remuneration Committee and CSR Committee of Indian Companies
11
REPORT ON CORPORATE GOVERNANCE
The Directors present the Companyrsquos Report on CorporateGovernance pursuant to the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements)Regulations 2015 (lsquoListing Regulations 2015rsquo)
THE COMPANYrsquoS GOVERNANCE PHILOSOPHY
The Company firmly believes in good CorporateGovernance and has made it a practice and a continuousprocess of development right across the Company TheCompanyrsquos philosophy on Corporate Governanceenvisages attainment of high level of transparency andaccountability in the functioning of the Company andconduct of business and places due emphasis onregulatory compliance It has empowered the ExecutiveManagement to take decisions with regard to day-to-dayoperations and has also created checks and balances thatsuch decisions are taken with care and responsibility tomeet stakeholdersrsquo aspirations and societal expectations
The Companyrsquos corporate philosophy is focused on itspeople who are its most important asset and it values itsemployeesrsquo integrity creativity ability judgement andopinions who in turn demonstrate the highest ethicalstandards and responsibility towards the shareholdersThis has helped the Company take rapid strides in itspursuit of excellence
The Company is committed to enhance shareholder valuein a fair and transparent manner and has been in theforefront for benchmarking itself with the best businesspractices globally
BOARD OF DIRECTORS
All statutory and other significant and material informationare placed before the Board of Directors (the Board) toenable it to discharge its responsibility of strategicsupervision of the Company as trustees of theshareholders
Composition
The Board comprises entirely of Non-Executive Directorsincluding one Woman Director and two IndependentDirectors The strength of the Board as on 15th April 2019is five
The Board Diversity Policy of the Company requires theBoard to have balance of skills experience and diversity ofperspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the Annexure forming part ofthis Report These skills expertise and competencies areavailable in the present mix of the Directors of the Company
Composition of the Board as on 31st March 2019
Category No of PercentageDirectors to total no
of Directors
Non-Executive Independent Directors 3 50Other Non-Executive Directors 3 50Total 6 100
During the year there was no change in the directorshipMr R C Mehta resigned as Non-Executive IndependentDirector of the Company with close of work on 31st March2019 keeping in view the Regulation 17(1A) of ListingRegulations 2015
Mr Mehta has confirmed that there are no other reasons forhis resignation other than stated above
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Board were held The intervening periodbetween two Board meetings was well within the maximumgap of 120 days prescribed under the Listing Regulations2015
Board Agenda
Meetings are governed by a structured agenda The Boardmembers in consultation with the Chairman may bring upany matter for the consideration of the Board All majoragenda items are backed by comprehensive backgroundinformation to enable the Board to take informed decisionsAgenda papers are generally circulated seven days prior tothe Board meeting
Information placed before the Board
The following matters are tabled for the Boardrsquos periodicreview information
bull Annual operating plans amp budgets and periodic reviewof the Companyrsquos businesses
bull Quarterly performance
bull External Audit Management Reports (through the AuditCommittee)
bull Status of legal compliance
bull Status and effectiveness of risk management plans
bull Succession to senior management (through theNominations and Remuneration Committee)
bull Statutory compliance reports
bull Show cause demand prosecution adjudicationnotices if any from revenue authorities which areconsidered materially important including anyexposure that exceeds 1 of the Companyrsquos net worthand their outcome
12
bull W rite-offs disposals (fixed assets receivablesadvances etc) on a half-yearly basis
bull Significant development in Human Resources Industrial Relations
bull Material non-compliance of any regulatory or listingrequirements and in relation to shareholdersrsquoservices
bull All other matters required to be placed before theBoard for its review information under the ListingRegulations 2015 and other statutes
Post-meeting follow-up systemThe Governance processes in the Company include aneffective post-meeting follow-up review and reportingprocess for action taken pending on decisions of the Boardand the Board Committees
Details of Board Meeting during the financial year
During the financial year ended 31st March 2019 fourmeetings of the Board were held as follows
SI Date Board No ofNo Strength Directors
present
1 17th April 2018 6 6
2 7th August 2018 6 6
3 1st November 2018 6 5
4 30th January 2019 6 5
COMMITTEES OF THE BOARD
Currently there are three Committees of the Board ndash theAudit Committee the Stakeholders RelationshipCommittee and the Nominations and RemunerationCommittee The terms of reference of the BoardCommittees are determined by the Board from time to timeMeetings of Board Committees are convened by therespective Committee Chairman All the recommendationsmade by Board Committees during the year were acceptedby the Board Minutes of Board Committee meetings areplaced before the Board for its information The role andcomposition of these Committees including the numberof meetings held during the financial year and the relatedattendance are provided below
A AUDIT COMMITTEEThe Audit Committee of the Board provides reassurance tothe Board on the existence of an effective internal controlenvironment that ensuresbull efficiency and effectiveness of operations
bull safeguarding of assets and adequacy of provisionsfor all liabilities
bull reliability of financial and other managementinformation and adequacy of disclosures
bull compliance with all relevant statutesThe role of the Committee includes the followingbull To oversee the Companyrsquos financial reporting process
and the disclosure of its financial information to
REPORT ON CORPORATE GOVERNANCE
Directorsrsquo attendance at the Board Meetings during the financial year and at the last Annual General Meeting (AGM) as alsotheir other Directorships and Committee Memberships are given below
SI Director Category No of Attendance No of No of Membership(s) No Board at last other Chairmanship(s) of Audit
Meetings AGM Directorship(s) Committee Stakeholdersattended Relationship Committee of
other Indian public limitedcompanies
1 N Anand Chairman amp 4 Yes 8 1Non-Executive Director
2 C K Koshy Non-Executive 4 Yes Nil NilIndependent Director
3 R C Mehta1 Non-Executive 2 Yes 4 NilIndependent Director
4 M Narayanan Non-Executive 4 Yes 4 4 (all as Chairman)Independent Director
5 D R Choudhary Non-Executive Director 4 Yes 1 Nil6 J Singh Non-Executive Director 4 Yes 8 3 (including 1 as Chairman)
1 Resigned as Non-Executive Independent Director wef 1st April 2019 Details with respect to other Directorships of the Directors are provided under the section lsquoYour Directorsrsquo in the Report and Accounts
13
ensure that the financial statements are correctsufficient and credible
bull To recommend the appointment remuneration termsof appointment and removal of Statutory Auditors
bull To approve transactions of the Company with relatedparties
bull To evaluate the Companyrsquos internal financial controlsand risk management systems
bull To review with the management the following
- Annual financial statements and Auditorrsquos Reportthereon before submission to the Board forapproval
- Quarterly financial statements before submissionto the Board for approval
bull To review the following
- Management discussion and analysis of financialcondition amp results of operations and mattersrequired to be included in the DirectorsrsquoResponsibility Statement
- Adequacy of internal control systems and theCompanyrsquos statement on the same prior toendorsement by the Board such review to bedone in consultation with the managementStatutory and Internal Auditors
- Adequacy of internal control systems forcompliance with the provisions of the Securitiesand Exchange Board of India (Prohibition ofInsider Trading) Regulations 2015
- Reports of Internal Audit and discussion withInternal Auditors on any significant findings andfollow-up thereon
- Statutory Auditorsrsquo independence andperformance and effectiveness of the auditprocess
- System for storage retrieval security etc of booksof account maintained in the electronic form
- Functioning of Whistleblower mechanism in theCompany
Composition
The Audit Committee as on 15th April 2019 comprisesthree Non-Executive Directors two of whom are IndependentDirectors The Chairman of the Committee is anIndependent Director The Chief Executive Officer the ChiefFinancial Officer and the representative of Statutory Auditorsare Invitees to meetings of the Audit Committee and theCompany Secretary is the Secretary to the Committee Allmembers of the Committee are financially literate twomembers including the Chairman of the Committee haveaccounting and financial management expertise
The names of the members of the Audit Committeeincluding its Chairman are provided under the sectionlsquoBoard of Directors amp Committeesrsquo in the Report andAccounts
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Audit Committee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 4 4
2 7th August 2018 4 4
3 1st November 2018 4 3
4 30th January 2019 4 3
Attendance at Audit Committee Meetings during thefinancial year
Member No of meetingsattended
M Narayanan1 4
C K Koshy 4
R C Mehta2 2
J Singh 41 Appointed Chairman wef 15th April 20192 Ceased to be Member and Chairman wef 1st April 2019
B STAKEHOLDERS RELATIONSHIP COMMITTEE
The Stakeholders Relationship Committee of the Boardoversees redressal of shareholder and investor grievancesand inter alia approves transmission of sharessub-division consolidation renewal of share certificatesissue of duplicate share certificates etc
Composition
The Stakeholders Relationship Committee presentlycomprises three Non-Executive Directors including oneIndependent Director The Chairman of the Committee is aNon-Executive Director The Company Secretary is theSecretary to the Committee
The names of the members of the StakeholdersRelationship Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 sevenmeetings of the Stakeholders Relationship Committeewere held as follows
REPORT ON CORPORATE GOVERNANCE
14
SI Date Committee No ofNo Strength Members
present1 17th April 2018 2 2
2 29th June 2018 2 2
3 7th August 2018 2 2
4 27th September 2018 2 2
5 1st November 2018 2 2
6 4th January 2019 2 2
7 30th January 2019 2 2
Attendance at Stakeholders Relationship CommitteeMeetings during the financial year
Member No of meetingsattended
J Singh 7
D R Choudhury 7
C K Koshy 0
Appointed Member wef 31st March 2019
C NOMINATIONS AND REMUNERATION COMMITTEEThe Nominations and Remuneration Committee of theBoard inter alia identifies persons qualified to becomeDirectors and formulates criteria for evaluation ofperformance of the Directors and the Board as a wholeThe Committeersquos role includes recommending to theBoard the appointment remuneration and removal ofDirectors and Key Managerial Personnel
Composition
The Nominations and Remuneration Committee as on15th April 2019 comprises four Non-Executive Directorstwo of whom are Independent Directors The Chairman ofthe Committee is an Independent Director The CompanySecretary is the Secretary to the Committee
The names of the members of the Nominations andRemuneration Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 twomeetings of the Nominations and RemunerationCommittee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 5 5
2 30th January 2019 5 4
Attendance at Nominations and Remuneration CommitteeMeetings during the financial year
Member No of meetingsattended
C K Koshy 2
N Anand 2
R C Mehta1 1
M Narayanan 2
J Singh 21 Ceased to be Member wef 1st April 2019
Remuneration Policy
The Companyrsquos Remuneration Policy aims at attractingand retaining high calibre talent The Remuneration Policytherefore is market-led and takes into account thecompetitive circumstance of each business so as to attractand retain quality talent and leverage performancesignificantly
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpwwwgujarathotels ltd in polic ies Remuneration-Policy_GHLpdf There has been no change in the Policyduring the year
Remuneration of Directors
Non-Executive Directors are entitled to sitting fees forattending the meetings of the Board and its Committeesthe quantum of which is determined by the Board Thesitting fees to Non-Executive Directors as determined bythe Board are ` 20000- and ` 10000- for each meeting ofthe Board and its Committees respectively
Details of sitting fees paid to the Directors during thefinancial year ended 31st March 2019
Director Sitting Fees (`)
C K Koshy 150000-
R C Mehta1 70000-
M Narayanan 150000-1 Resigned as Non-Executive Independent Director wef1st April 2019
Note Disclosure with respect to Non-Executive Directors ndashPecuniary relationship or transaction None
Performance Evaluation
Performance evaluation of the Board the BoardCommittees and the individual Directors was carried outby the Board in accordance with the Policy approved by theNominations and Remuneration Committee in this regardbrief details of the same are provided in the lsquoReport of theBoard of Directors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
REPORT ON CORPORATE GOVERNANCE
15
Directorsrsquo Shareholding
Details of Shareholding of the Directors in the Company ason 31st March 2019 are given below
Director No of Equity Shares of ` 10-each held singly jointly
N Anand 200
D R Choudhury Nil
C K Koshy Nil
R C Mehta Nil
M Narayanan Nil
J Singh Nil
OTHER DISCLOSURESbull Details of non-compliances penalties and strictures
by Stock Exchanges SEBI Statutory Authorities onany matter related to capital markets during the lastthree years
Nonebull Inter-se relationships between Directors and Key
Managerial Personnel of the Company
Nonebull Materially significant related party transactions which
may have potential conflict with the interests of theCompany at large
Nonebull Material financial and commercial transactions of
senior management where they may have hadpersonal interest and which had potential conflict withthe interests of the Company at large
Nonebull Details of utilisation of funds raised through
preferential allotment or qualified institutionsplacement
Not Applicablebull Credit rating(s) obtained by the Company for any debt
instrument fixed deposit programme or any otherscheme involving mobilisation of funds
Nonebull None of the Directors of the Company has been
debarred or disqualified from being appointed orcontinuing as a Director by SEBI Ministry of CorporateAffairs Statutory Authorities which has also beenconfirmed by Messrs PB amp Associates PractisingCompany Secretaries
bull Confirmation by the Board with respect to theIndependent Directors is provided in the lsquoReport ofthe Board of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Disclosures in relation to the Sexual Harassment ofWomen at Workplace (Prevention Prohibition andRedressal) Act 2013 are provided in the lsquoReport of theBoard of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Information with respect to lsquoCommodity Price Risk orForeign Exchange Risk and Hedging Activitiesrsquo
Nonebull The total fees paid by the Company to Messrs K C
Mehta amp Co Statutory Auditors and all other entitiesforming part of the same network aggregate` 100000-
bull Compliance Officer under the Listing Regulations2015
Deepak Kumar Gulati Company Secretary
MEANS OF COMMUNICATION
Timely disclosure of consistent comparable relevant andreliable information on corporate financial performance isat the core of good governance Towards this end thequarterly results of the Company were announced withinforty five days from the end of the quarter Audited annualresults along with the results for the fourth quarter wereannounced within sixty days from the end of the financialyear Extract of these results were published in lsquoTheFinancial Expressrsquo (all editions) and in its Gujarati editionas vernacular newspaper Further quarterly resultsshareholding pattern and other material events amp importantinformation relating to the Company were submitted to BSELimited through BSE Listing Centre for dissemination onits website The Company publishes its quarterlyhalf-yearly and annual financial results and also posts suchresults on its website wwwgujarathotelsltdin
The Report of the Board of Directors forming part of theReport and Accounts includes all aspects of lsquoManagementDiscussion and Analysisrsquo as required under the ListingRegulations 2015
GHL CODE OF CONDUCT FOR PREVENTION OF INSIDERTRADING ndash 2019
The GHL Code of Conduct for Prevention of Insider Tradingapproved by the Board inter alia prohibits trading insecurities of the Company by Directors and employeeswhile in possession of unpublished price sensitiveinformation in relation to the Company
GHL CODE OF CONDUCT
The GHL Code of Conduct is applicable to Directors seniormanagement and employees of the Company The Codeis derived from three interlinked fundamental principlesviz good corporate governance good corporate citizenshipand exemplary personal conduct in relation to theCompanyrsquos business and reputation The Code coversGHLrsquos commitment to sustainable development concern
REPORT ON CORPORATE GOVERNANCE
16
for occupational health safety and environment a genderfriendly workplace transparency and auditability legalcompliance and the philosophy of leading by personalexample The Code is available on the Companyrsquos website
Declaration as required under the Listing Regulations 2015All Directors and senior management of the Companyhave affirmed compliance with the GHL Code of Conductfor the financial year ended 31st March 2019New Delhi K Pahwa15th April 2019 CEO
WHISTLEBLOWER POLICYSynopsis of the Whistleblower Policy of the Company isprovided in the lsquoReport of the Board of Directors ampManagement Discussion and Analysisrsquo forming part of theReport and Accounts The Whistleblower Policy is alsoavailable on the Companyrsquos websiteFAMILIARISATION PROGRAMME FOR DIRECTORSGHL believes that a Board which is well informed familiarised with the Company and its affairs can contributesignificantly to effectively discharge its role of trusteeshipin a manner that fulfils stakeholdersrsquo aspirations andsocietal expectations In pursuit of this the Directors of theCompany are updated on changes developments in thedomestic global corporate and industry scenario includingthose pertaining to statutes legislations and economicenvironment and on matters affecting the Company toenable them to take well informed and timely decisionsFurther details may be accessed on the Companyrsquos websiteat httpwwwgujarathotelsltdinpoliciesDirectorrsquos-Familiarisation-programmespdfPOLICY ON RELATED PARTY TRANSACTIONSThe Policy as approved by the Board may be accessed onthe Companyrsquos website at
h t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_TranscationspdfDISCRETIONARY REQUIREMENTS UNDER THE LISTINGREGULATIONS 2015The status of compliance with the discretionaryrequirements under the Listing Regulations 2015 isprovided below1 Chairmanrsquos Office The Company has a Non-Executive
Chairman but he does not maintain any separate officeand hence no expense in this regard is being incurredby the Company
2 Shareholder Rights The quarterly half-yearly andannual financial results of the Company are postedon the Companyrsquos website and extract of these resultsare published in newspapers on an all India basisThe complete Report and Accounts is sent to everyShareholder of the Company
3 Audit Opinion It has always been the Companyrsquosendevour to present financial statements with
unmodified audit opinion The Statutory Auditors haveissued an unmodified audit opinion on the Companyrsquosfinancial statements for the year ended 31st March2019
4 Separate posts of Chairman and Chief ExecutiveOfficer The Company has a Non-Executive Chairmanand a Chief Executive Officer
5 Internal Audit The Internal Auditor of the CompanyMessrs Shah amp Talati Chartered Accountants reportsto the Audit Committee of the Board
GENERAL SHAREHOLDER INFORMATIONProvided in the lsquoShareholder Informationrsquo section of theReport and Accounts
CONFIRMATION OF COMPLIANCEbull It is confirmed that the Company has complied with
the requirements prescribed under Regulations 17 to27 and clauses (b) to (i) of sub - regulation (2) ofRegulation 46 of the Listing Regulations 2015
bull The Statutory Auditorsrsquo Certificate that the Companyhas complied with the conditions of CorporateGovernance is annexed to the lsquoReport of the Board ofDirectors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
ANNEXURE TO THE REPORT ON CORPORATEGOVERNANCESKILLS EXPERTISE AND COMPETENCIES OF DIRECTORSThe Company believes that Board members should havea balance of skills experience and diversity of perspectivesappropriate to the Company Accordingly the Directorsshould possess one or more of the following skillsexpertise and competencies
1 Leadership
Leadership experience in a commensurate-sizedorganisation with understanding of organisationalsystems and processes strategic areas andemerging business trends
2 Industry Knowledge and Experience
Domain knowledge of Hotel business and itsdynamics long-term strategies and regulatory ampcompetitive environment
3 Finance and Accounting
Ability to understand financial policies accountingstatements and disclosure practices to contribute tothe financial risk management policies and practicesof the Company
4 Governance
Commitment belief and experience in settinggovernance practices to support the Companys legalcompliance systems and governance polic ies practices
REPORT ON CORPORATE GOVERNANCE
17
SHAREHOLDER INFORMATION
AGM Details
Date Saturday 7th September 2019Venue WelcomHotel Vadodara R C Dutt Road
Alkapuri Vadodara 390 007Time 1100 amBook Friday 30th August 2019 toClosure Saturday 7th September 2019Dates (both days inclusive)Dividend Friday 13th September 2019PaymentDate
Registrar and Share Transfer Agents
Messrs MCS Share Transfer Agent Limited are the Registrarand Share Transfer Agents (RTA) of the Company forcarrying out share registration and other related activitiesof the Company
Address for Correspondence
MCS Share Transfer Agent LimitedF-65 1st Floor Okhla Industrial AreaPhase ndash I New Delhi - 110 020Telephone Nos 011 4140 6149-52 4160 9386Facsimile No 011 4170 9881E-mail helpdeskdelhimcsregistrarscom
Shareholders holding shares in the dematerialised formshould address their correspondence except those relatedto dividend to their respective Depository Participants
Share Transfer Committee
The Share Transfer Committee of the Company generallymeets once in ten days for approving share transfers Theprocessing activities with respect to requests received forshare transfers are completed within fifteen days from thedate of receipt of request The Committee met 11 timesduring the financial year ended 31st March 2019 to approveshare transfers There were no share transfers pendingas on 31st March 2019
The Share Transfer Committee presently comprises thefollowing
D R Choudhury - Director MemberJ Singh - Director MemberM Agarwal - Compliance Officer Member
Dematerialisation of Shares and Liquidity
The shares of the Company are available for trading in thedematerialised form under both the Depository Systems inIndia - NSDL and CDSL The International SecuritiesIdentification Number (lSIN) allotted to the Companysshares under the Depository System is INE621C01011
As on 31st March 2019 a total of 3525013 Equity Sharesof the Company which translates to 9307 of the ShareCapital stood dematerialised The processing activitieswith respect to requests received for dematerialisation arecompleted between fifteen to thirty daysShareholder Investor ComplaintsThe Company attends to Shareholder Investor complaintsqueries and other correspondence generally within fifteendays except where constrained by disputes or legalimpedimentsThe Company did not receive any complaint during thefinancial year ended 31st March 2019The e-mail ID earmarked by the Company for this purposeghlinvestorsyahoocoinDistribution of Shareholding as on 31st March 2019
No of No of EquityNo of Shareholders Shares
SharesSlab Total to Total to
Share Shareholders Capital
1 - 500 5152 9455 587438 1551501 - 1000 138 253 112061 296
1001 - 2000 68 125 100167 2652001 - 3000 26 048 62030 1643001 - 4000 16 029 58804 1554001 - 5000 11 020 50785 1345001 - 10000 23 042 163405 431
10001 - 50000 8 015 147787 39050001 - 100000 3 006 226954 599
100001 amp Above 4 007 2278084 6015Total 5449 10000 3787515 10000
Categories of Shareholders as on 31st March 2019Sl Category No of toNo Shares Share
held hold ingA Promoter Holding1 Promoter and Promoter Group
ITC Limited 1733907 4578Russell Investments Limited 300056 792Sub-Total 2033963 5370
B Non Promoter Holding2 Institutional Investorsa Mutual Funds NIL NILb Banks 100 000c Foreign Institutional Investors and NIL NIL
Foreign Portfolio InvestorsSub-Total 100 000
3 Othersa Private Corporate Bodies 193726 511b Indian Public 1335461 3527c NRIs 102362 270d Others 121903 322
Sub Total 1753452 4630Grand Total 3787515 10000
18
Monthly High and Low Quotes and Volume of Sharestraded on BSE Limited
Year Month High L o w Volume(` ) (` ) (Nos)
2018 April 13800 12000 93584May 13100 11710 26778June 12735 11500 18090July 12195 11400 27113August 12295 11450 14900September 12000 10900 23492October 11400 10505 18787November 12975 10700 15386December 11490 10700 40291
2019 January 11320 10700 22160February 11185 10005 12395March 11295 10400 21625
Performance in comparison to broad based indices suchas SampP BSE Sensex
Note - Indicates monthly closing positions
Listing of Shares on Stock Exchange (with Stock Code)BSE Limited (507960)Phiroze Jeejeebhoy Towers Dalal Street Mumbai 400 001Telephone Nos 022-2272 1233 34Facsimile No 022-2272 1919E-mail isbseindiacomWebsite wwwbseindiacom
The Listing Fee for the financial year 2019-20 has beenpaid to BSE Limited
Financial CalendarFinancial Year 2019-20(1st April - 31st March)
1 First Quarter Results July 20192 Second Quarter and October November 2019
Half-Year Results3 Third Quarter Results January February 20204 Fourth Quarter and May 2020
Annual Results
Particulars of past three AGMsAGM Financial Venue Date Time Special
Year ResolutionPassed
36th 2017-18 WelcomHotel 07-08-2018 NoneVadodara
35th 2016-17 R C Dutt Road 08-08-2017 1100 NoneAlkapuri am
34th 2015-16 Vadodara 20-09-2016 None390 007
Postal Ballot
No special resolution requiring postal ballot was eitherproposed last year or is being proposed for the ensuing AGM
SHAREHOLDER REFERENCER
Transfer of Shares in certificate form
Effective 1st April 2019 transfer of shares of a listedcompany can only be effected in dematerialised form interms of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 Shareholders holdingshares in the certificate form are therefore requested todematerialise their shares in their own interestCommunication in this respect has been sent by theCompany during the year to the concerned ShareholdersHowever transfer deeds which were lodged with theCompany on or before 31st March 2019 but were returneddue to any deficiency will be processed upon re-lodgement
Transfer of Dividend and corresponding Equity Shares tothe Investor Education and Protection Fund (IEPF)
During the financial year 2018-19 unclaimed dividend forthe financial year 2010-11 aggregating ` 636444- andthe corresponding 13150 Equity Shares in respect of whichdividend entitlements remained unclaimed for sevenconsecutive years or more have been transferred by theCompany to the IEPF established by the CentralGovernment pursuant to the provisions of Section 124 ofthe Companies Act 2013 read with the Investor Educationand Protection Fund Authority (Accounting Audit Transferand Refund) Rules 2016
Shareholders may claim their unclaimed dividend for theyears prior to and including the financial year 2010-11 andthe corresponding shares from the IEPF Authority byapplying in the prescribed Form No IEPF-5 This Form canbe downloaded from the website of the IEPF Authoritywwwiepfgovin the access link of which is also availableon the Companys website wwwgujarathotelsltdin underthe section General Information under Shareholder Value
The unclaimed dividend for the undernoted years and thecorresponding shares will be transferred by the Companyto the IEPF in accordance with the schedule given belowAttention in particular is drawn that the unclaimed dividendfor the financial year 2011-12 and the corresponding shareswill be due for transfer to the IEPF on 14th September
SHAREHOLDER INFORMATION
19
Central Depository Services (India) LimitedMarathon Futurex A Wing 25th FloorMafatlal Mill Compound N M Joshi MargLower Parel Mumbai 400 013Telephone No 022-2302 3333Facsimile No 022-2300 2035E-mail helpdeskcdslindiacomWebsite wwwcdslindiacomRemittance of Dividend through Electronic ModeThe Company provides the facility for remittance of dividendto Shareholders through RTGS (Real Time GrossSettlement) NACH (National Automated Clearing House) NEFT (National Electronic Funds Transfer)
Shareholders who have not opted for remittance of dividendthrough electronic mode and wish to avail the same arerequired to provide their bank details including IFSC (IndianFinancial System Code) and MICR (Magnetic Ink CharacterRecognition) to their respective Depository Participants(DPs) or to the RTA where shares are held in thedematerialised form and in the certificate form respectively
Shareholders holding shares in the certificate form mayuse the Mandate Form for this purpose which can bedownloaded from the Companys websitewwwgujarathotelsltdin under the section GeneralInformation under Shareholder Value
Address and Bank DetailsShareholders holding shares in the certificate form arerequested to advise the RTA of any change in their address mandate bank details to facilitate better servicingShareholders are advised that as a measure of protectionagainst fraudulent encashment their bank details oraddress as available with the RTA will be printed on thedividend warrants or demand drafts where dividend cannotbe remitted through electronic mode
Permanent Account Number (PAN)Shareholders holding shares in the certificate form arerequested to send copies of their PAN Cards to the RTA tofacilitate better servicing
Furnishing of PAN Card however is mandatory as followsi) Transferees and Transferors PAN Cards for transfer
of sharesii) Legal heirs Nominees PAN Cards for transmission
of sharesiii) Surviving joint holders PAN Cards for deletion of name
of deceased Shareholders andiv) Joint holders PAN Cards for transposition of shares
Nomination Facility
Shareholders who hold shares in the certificate form andwish to make any nomination change nomination madeearlier in respect of their shareholding in the Companyshould submit to the RTA the prescribed Form such Formcan be downloaded from the Companys website underthe section Investor Relations under Shareholder Value
SHAREHOLDER INFORMATION
2019 for which purpose communication has been sent tothe concerned Shareholders advising them to write to theCompany to claim their dividend Notices in this regardhave also been published in newspapers Details of suchunclaimed dividend and corresponding shares areavailable on the Companys website under the sectionGeneral Information under Shareholder Value
Financial Date of declaration Due date for transferYear of Dividend to IEPF2011-12 8th August 2012 14th September 2019
2012-13 13th August 2013 19th September 2020
2013-14 29th September 2014 5th November 2021
2014-15 29th September2015 5th November 2022
2015-16 20th September 2016 26th October 2023
2016-17 8th August 2017 14th September 2024
2017-18 7th August 2018 12th September 2025
The Company will not be able to entertain any claim receivedafter 12th September 2019
Shareholders who have not so far encashed their dividendwarrant(s) or have not received the same are requested toapply for duplicate warrant(s) by writing to the Companyand confirming non-encashment non-receipt of dividendwarrant(s)
Service of Documents
The Company sends Notices Report and Accounts andother communications in electronic mode to thoseShareholders who have registered their e-mail addresseswith the Company or with the Depositories and in physicalmode to the other Shareholders
Shareholders who wish to register or update their e-mailaddresses with the Company may use the Form forregistration updation which can be downloaded from theCompanys website under the section Investor Relationsunder Shareholder Value
Depository Services
Shareholders may write to the respective Depository or tothe RTA for guidance on depository services
The contact details of the Depositories are given below
National Securities Depository LimitedTrade World A Wing 4th FloorKamala Mills CompoundSenapati Bapat Marg Lower ParelMumbai 400 013Telephone No 022-2499 4200Facsimile No 022-2497 6351E-mail infonsdlcoinWebsite wwwnsdlcoin
20
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
FOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019Your Directors submit their Report for the financial yearended 31st March 2019
BUSINESS ENVIRONMENT
The global economic growth softened to 36 in 2018representing a marked slowdown compared to the 39growth anticipated at the beginning of the year buoyed bya strong fiscal expansion in the USA which was offset largelyby slower growth in some other large economies ieEurope Japan etc Going forward global growth in 2019 isprojected to decline further to 33 in the base case withrisks to the downside emanating from politicaluncertainties rising trade tensions escalatingprotectionism and tighter financial conditions
As per Ministry of Statistics amp Programme Implementation(MSPI) Indian economy registered the GDP growth of 7in 2018-19 as compared to 72 in 2017-18 The economyis expected to grow and maintain a level of 75 in 2019and 2020 as per the World Bank estimates
India is the most digitally-advanced traveller nation in termsof digital tools being used for planning booking andexperiencing a journey During 2018 foreign tourist arrivals(FTAs) in India stood at 1056 million achieving a growthrate of 52 year-on-year The Government of India is alsoworking to achieve 1 share in worldrsquos international touristarrivals by 2020 and 2 share by 2025
The operating environment in the hospitality sector showedimprovement with foreign tourist arrivals Indiarsquos risingmiddle class and increasing disposable incomes havecontinued to support the growth of domestic tourism
With the inauguration of Statue of Sardar Vallabhbhai Patelalso known as lsquoStatute of Unityrsquo which is the higheststanding statue in the world at a height of 182 meters thetourism in the city of Vadodara is expected to grow
FINANCIAL PERFORMANCE
During the year under review your Company earned licensefees of ` 36987 lakhs (previous year ` 33098 lakhs)Theother income at ` 19626 lakhs showed an increase mainlydue to improvement in return on current investment Preand post-tax profits increased to ` 51822 lakhs (previousyear ` 45313 lakhs) and ` 40788 lakhs (previous year` 33690 lakhs) respectively
Your Directors are pleased to recommend a dividend of` 350 per Equity Share of ` 10- each for the year ended31st March 2019 thereby maintaining last yearrsquos dividendand involving a cash outflow of ` 160 lakhs includingDividend Distribution Tax of ` 27 Lakhs
PROFITS DIVIDEND AND RETAINED EARNINGS
The financial results of your Company summarised areas under
For the year ended For the year ended31st March 2019 31st March 2018
Profits (` ) (` )
a Profit Before Tax 51822363 45312928
b Tax Expense
Current Tax 11653499 9272310Deferred Tax (618755) 2350502
c Profit for the year 40787619 33690116
d Other Comprehensive Income - -
e Total Comprehensive Income 40787619 33690116
Statement of Retained Earningsa At the beginning of the year 213211090 195873461
b Add Total Comprehensive Income 40787619 33690116
c Less Dividend paid including IncomeTax on Dividend paid 15981176 15954974
d Less Income Tax on Dividend paid forearlier year - 397513
e At the end of the year 238017533 213211090
Your Directors are pleased to recommend a dividend of` 350 per Equity Share (Previous Year ` 350) of ` 10-each for the year ended 31st March 2019
Details of changes in Key Financial Ratio amp Return onNet Worth
The key financial ratio of the Company where there hasbeen significant change (25 or more) and change inReturn on Net Worth are summarized below pursuant toSchedule V (B) to the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements)Regulations 2015 (Listing Regulations 2015)
HOTEL OPERATIONS
Your Hotel WelcomHotel Vadodara licensed to ITC Limitedrecorded an income of ` 249443 lakhs during the year ascompared to ` 221856 lakhs in the previous year Therewas an improvement in both occupancy and average roomrates leading to an overall improvement in HotelPerformance
Financial Ratio
2018-19 2017-18 Change
Reason for change
Current Ratio
278 223 25 Increase in value of current investment based on accumulation of market return and fresh investment done during the year out of surplus funds
Return on Net Worth
133 120 11 Due to higher rate of growth in profit after tax
21
The Food amp Beverage segment of your Companyrsquos Hotelcontinues to be a major strength The Peshawri Restaurantand the Welcom Cafeacute Cambay both retained their premiumleadership positions
Your Company has filed a writ petition in the Gujarat HighCourt seeking that the Gujarat State Government be directedto take action on your Companyrsquos application to have theleasehold land of the Hotel converted to freehold andtransferred to your Company as per the existing governmentpolicy in this regard The Honourable High Court passedan Order on 24th December 2014 restraining the StateGovernment from disturbing the peaceful and actualpossession of the Company over the hotel property in anymanner including construction thereon The writ petition ispending
Your Company is also making all efforts for expeditiousconversion of land from leasehold to freehold or in thealternative extension of Lease For further details pleaserefer to Note no 20A of the Accounts
SUBSIDIARIES ASSOCIATES AND JOINT VENTURES
The Company does not have any subsidiary associate orjoint venture
INTERNAL FINANCIAL CONTROLS
Your Company is managed by the Board of Directors andthe Executive Management with clearly defined rolesresponsibilities and authorities The Executive Managementis responsible for the day-to-day conduct of the affairs ofthe Company within the overall framework approved by theBoard Your Company also has a Code of Conduct whichrequires management to conform to the required financialand accounting policies systems and processes conductbusiness ethically and ensure strict compliance with allapplicable laws and regulations Ongoing ReviewProcesses and the Risk Management Framework create acontrol environment in the Company and provide thecornerstones for Internal Financial Controls with referenceto your Companyrsquos Financial Statements
Your Companyrsquos Financial Statements are prepared on thebasis of the Significant Accounting Policies that are carefullyselected by the management and approved by the AuditCommittee and the Board These Policies are reviewedand updated from time to time and audited by the InternalAuditor whose findings and recommendations are reviewedby the Audit Committee and tracked through toimplementation
Your Company maintains its Books of Account in electronicform Your Company has in place adequate internalfinancial controls with reference to the FinancialStatements
The Internal Auditors of the Company evaluates theadequacy and efficacy of such internal financial controlsSuch controls have been assessed during the year by the
management Based on the results of this assessmentno reportable material weakness or significant deficienciesin the design or operation of internal financial controls wereobserved Nonetheless your Company recognises that anyinternal financial control framework no matter how welldesigned has inherent limitations and accordingly regularaudit and review processes ensure that such systems arereinforced on an ongoing basis
RISK MANAGEMENT
Your Company continues its emphasis on a systems-basedapproach to business risk managementBacked by stronginternal control systems the current Risk Managementframework consists of the following key elements
- The Board of Directors (lsquoThe Boardrsquo) has clearly laiddown the roles and responsibilities of the Company inrelation to risk management covering a range ofresponsibilities from strategic to operational Theserole definitions provide the foundation for yourCompanyrsquos Risk Management Policy that is endorsedby the Board and is aimed at ensuring formulation ofappropriate risk management procedures theireffective implementation and independent monitoringand reporting by Internal Audit
- Management of risks vest with the ExecutiveManagement which is responsible for the day-to-dayconduct of the affairs of the Company within the overallframework approved by the Board
- A combination of policies and procedures which areregularly reviewed and updated in the light of changingbusiness and regulatory environment bringsrobustness to the process of ensuring that businessrisks are effectively addressed
- Appropriate structures are in place to proactivelymonitor and manage the inherent risks in businesswith unique relatively high risk profiles
- An Independent Internal Audit Firm carries out riskfocused audits enabling identification of areas whererisk management processes may need to bestrengthened
- The Audit Committee of the Board reviews the InternalAudit findings and provides strategic guidance oninternal controls The Chief Executive Officer closelymonitors the internal control environment within yourCompany including implementation of the action plansemerging out of internal audit findings
The combination of policies and processes as outlinedabove adequately address the various risks associatedwith your Companyrsquos business
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
22
AUDIT AND SYSTEMS
Your Company believes that internal control is a necessaryadjunct to the principle of governance that freedom ofmanagement should be exercised within a framework ofappropriate checks and balances Your Company remainscommitted to ensuring an effective internal controlenvironment that provides assurance and comfort on orderlyand efficient conduct of operations security of assetsprevention and detection of frauds errors accuracy andcompleteness of accounting records and timely preparationof reliable financial information
Your Companyrsquos independent and robust Internal Auditprocesses provide assurance on the adequacy andeffectiveness of internal controls compliance withoperating systems internal policies and regulatoryrequirements
The Internal Audit function consisting of an outsourcedprofessional firm is adequately resourced to deliver highstandards of audit assurances
The Audit Committee of your Board met four times duringthe year The Terms of Reference of the Audit Committeeincluded reviewing the adequacy and effectiveness of theinternal control environment monitoring implementationof the action plans emerging out of Internal Audit findingsincluding those relating to strengthening of your Companyrsquosrisk management systems and discharge of statutorymandate
HUMAN RESOURCE DEVELOPMENT
Your Company firmly believes that employees are the vitaland most valuable assets and hence has created afavourable work environment that encourages innovationand meritocracy Your Company continues to innovate inthe way human resources are managed and developedstriking a balance between business needs and individualaspirations
With an undying commitment to render delightful servicesyour Companyrsquos employees consistently work towardsdelivering flawless performance and are continuing todelight customers
The Company provides a safe secure inclusive and genderfriendly workplace The Company has put in placeGrievance Redressal Procedures and adopted a Policy onSexual Harassment as per the provisions of the SexualHarassment of W omen at W orkplace (PreventionProhibition and Redressal) Act 2013 and the Rules framedthereunder The Company has an Internal ComplaintsCommittee to ensure that grievances in this regard if anyare effectively addressed During the year under review nocomplaint relating to sexual harassment has beenreceived
WHISTLEBLOWER POLICY
The Companyrsquos W histleblower Policy encouragesDirectors and employees to bring to the Companyrsquosattention instances of unethical behavior actual orsuspected incidents of fraud actual or suspectedinstances of leak of unpublished price sensitive informationor violation of the GHL Code of Conduct that could adverselyimpact the Companyrsquos operations business performanceand or reputation The Policy provides that the Companyinvestigates such incidents when reported in an impartialmanner and takes appropriate action to ensure that therequisite standards of professional and ethical conductare always upheld It is the Companyrsquos Policy to ensurethat no employee is victimised or harassed for bringingsuch incidents to the attention of the Company
The practice of the Whistleblower Policy is overseen by theAudit Committee and no employee has been denied accessto the Committee The Whistleblower Policy is available onthe Companyrsquos website at httpwwwgujarathotelsltdinCorporateGovernancehtml
DEPOSITS
Your Company has not accepted any deposits from thepublic members under Section 73 of the Companies Act2013 (lsquothe Actrsquo) read with the Companies (Acceptance ofDeposits) Rules 2014 during the year
DIRECTORS
Changes in Directors
Mr R C Mehta stepped down as Non-Executive IndependentDirector of the Company with effect from close of work on31st March 2019 keeping in view the Regulation 17(1A) ofthe Listing Regulations 2015 Your Directors would like torecord their appreciation for the services rendered byMr Mehta
The Board at the meeting held on 15th April 2019 on therecommendation of the Nominations and RemunerationCommittee recommended for the approval of the Membersthe re-appointment of Mr C K Koshy and Mr M Narayananas independent directors of your Company in terms ofSection 149 of the Act and Regulation 17 of the ListingRegulations 2015 with effect from 29th September 2019
Requisite Notices under Section 160 of the Act have beenreceived in respect of Messrs Koshy and Narayanan whohave filed their consents to act as Directors of the Companyif appointed
Appropriate resolutions seeking your approval to theaforesaid appointment will appear in the Notice conveningthe Thirty Seventh AGM of your Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
23
Retirement by Rotation
In accordance with the provisions of Section 152 of the Actread with Article 147 of the Articles of Association of theCompany Mr Jagdish Singh will retire by rotation at theensuing Annual General Meeting (lsquoAGMrsquo) of your Companyand being eligible offers himself for re-election Your Boardrecommends his re-election
Number of Board Meetings
During the year ended 31st March 2019 four meetings ofthe Board were held
Attributes Qualifications amp Independence of Directorsand their Appointment
As reported last year the Nominations and RemunerationCommittee of the Board had approved the criteria fordetermining qualifications positive attributes andindependence of Directors in terms of the Act and the Rulesthereunder both in respect of Independent Directors andother Directors as applicable The criteria inter aliarequires that NonndashExecutive Directors includingIndependent Directors be drawn from amongst eminentprofessionals with experience in business finance law public administration and enterprises
The Board Diversity Policy of the Company requires theBoard to have a balance of skills experience and diversityof perspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the lsquoReport on CorporateGovernancersquo forming part of the Report and Accounts TheArticles of Association of the Company provide that thestrength of the Board shall not be fewer than three normore than twelve
Directors are appointed re-appointed with the approval ofthe Members All Directors other than IndependentDirectors are liable to retire by rotation unless otherwiseapproved by the Members One-third of the Directors whoare liable to retire by rotation retire every year and areeligible for re-election
The Independent Directors of your Company haveconfirmed that (a) they meet the criteria of independenceas prescribed under Section 149 of the Act and Regulation16 of the Listing Regulations 2015 and (b) they are notaware of any circumstance or situation which could impairor impact their ability to discharge duties with an objectiveindependent judgement and without any external influenceFurther in the opinion of the Board the IndependentDirectors fulfil the conditions prescribed under the ListingRegulations 2015 and are independent of the managementof the Company
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpw w wg u j a ra th o te ls l td in p o l i c ies R em u n era t io n -
Policy_GHLpdf There has been no change in the Policyduring the year
Board Evaluation
The Nominations and Remuneration Committee hasapproved the Policy on Board Evaluation Evaluation ofBoard Committeesrsquo functioning and individual DirectorEvaluation and also specified that such evaluation will bedone by the Board Board performance is assessed againstthe role and responsibilities of the Board as provided inthe Act and the Listing Regulations 2015 The parametersfor Board performance evaluation have been derived fromthe Boardrsquos core role of trusteeship to protect and enhanceshareholder value as well as fulfil expectations of otherstakeholders through strategic supervision of the CompanyEvaluation of functioning of Board Committees is basedon discussions amongst Committee members and sharedby each Committee Chairman with the Board IndividualDirectors are evaluated in the context of the role played byeach Director as a member of the Board at its meetingsand in assisting the Board in realising its role of strategicsupervision of the functioning of the Company in pursuit ofits purpose and goals
While the Board evaluated its performance against theparameters laid down by the Nominations andRemuneration Committee the evaluation of individualDirectors was carried out anonymously in order to ensureobjectivity The Board was briefed on functioning of BoardCommittees by the respective Committee Chairmen
Key Managerial Personnel
Mr Deependra Rana resigned as the Chief Executive Officerof the Company with effect from 17th December 2018
The Board at the meeting held on 30th January 2019 onthe recommendation of the Nominations andRemuneration Committee appointed Mr Kunal Pahwa asthe Chief Executive Officer of the Company with effect from1st February 2019
AUDIT COMMITTEE amp AUDITORS
The composition of the Audit Committee is provided underthe section lsquoBoard of Directors amp Committeesrsquo in the Reportand Accounts
Statutory Auditors
The Statutory Auditors Messrs K C Mehta amp Co CharteredAccountants (KCM) were appointed with your approval atthe Thirty Fifth AGM to hold such office till the conclusion ofthe Fortieth AGM
On the recommendation of the Audit Committee the Boardrecommended for the approval of the Members paymentof remuneration of KCM for the financial year 2019-20Appropriate resolution for this purpose will appear in theNotice convening the Thirty Seventh AGM of the Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
24
Secretarial Auditors
Your Board appointed Messrs PB amp Associates CompanySecretaries to conduct the secretarial audit of the Companyfor the financial year ended 31st March 2019 Their Reportis provided in the Annexure forming part of this Report interms of Section 204 of the Act
RELATED PARTY TRANSACTIONS
All contracts or arrangements entered into by the Companywith its related parties during the financial year were inaccordance with the provisions of the Act and the ListingRegulations 2015 All such contracts or arrangements wereentered in the ordinary course of business and on armrsquoslength basis and have been approved by the AuditCommittee
Further the details of related party transactions of theCompany in prescribed Form No AOC-2 in terms of Section134 of the Act read with Rule 8 of the Companies (Accounts)Rules 2014 is given in the Annexure to this Report YourCompanyrsquos Policy on Related Party Transactions asadopted by your Board can be accessed on the website ath t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_Transactionspdf
DIRECTORSrsquo RESPONSIBILITY STATEMENT
As required under Section 134 of the Act your Directorsconfirm having
a) followed in the preparation of the Annual Accounts theapplicable Accounting Standards with properexplanation relating to material departures if any
b) selected such accounting policies and applied themconsistently and made judgements and estimates thatare reasonable and prudent so as to give a true andfair view of the state of affairs of your Company at theend of the financial year and of the profit of yourCompany for that period
c) taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with theprovisions of the Act for safeguarding the assets ofyour Company and for preventing and detecting fraudand other irregularities
d) prepared the Annual Accounts on a going concernbasis
e) laid down internal financial controls to be followed byyour Company and that such internal financial controlswere adequate and operating effectively and
f) devised proper systems to ensure compliance withthe provisions of all applicable laws and that suchsystems were adequate and operating effectively
OTHER INFORMATION
Compliance with the conditions of Corporate Governance
The certificate of the Statutory Auditors Messrs K C Mehtaamp Co Chartered Accountants confirming compliance withthe conditions of Corporate Governance as stipulated underthe Listing Regulations 2015 is annexed
Compliance with Secretarial Standards
The Company is in compliance with the applicableSecretarial Standards issued by the Institute of CompanySecretaries of India and approved by the CentralGovernment under Section 118 of the Act
Cost Records
The Company is not required to maintain cost records interms of Section 148 of the Act read with the Companies(Cost Records and Audit) Rules 2014
Going Concern Status
There is no significant or material order passed during theyear by any regulator court or tribunal impacting the goingconcern status of the Company or its future operations
Extract of Annual Return
The information required under Section 134 of the Act readwith Rule 12 of the Companies (Management andAdministration) Rules 2014 is annexed
Particulars of Loans Guarantees or Investments
During the year ended 31st March 2019 the Company hasneither given any loan or guarantee nor has made anyinvestment under the provisions of Section 186 of the Act
Particulars relating to Conservation of Energy andTechnology Absorption
Particulars as required under Section 134 of the Act relatingto Conservation of Energy and Technology Absorption areprovided below-
Conservation of Energy
Steps taken on conservation of energy and impact thereof
Sl DescriptionNo
1 Installation of energy efficient Gas Burners and Induction Cooker
2 Improvement in energy usage efficiency in lighting system by changingover to efficient lighting solutions such as Light Emitting Diodes
3 Replacement of existing motors and pumps with more energy efficientequipment
4 Process improvement to enhance productivity and reduce specificenergy consumption
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
25
There were no employees who were employed throughoutthe year and were in receipt of remuneration aggregating` 102 crores or more or were employed for part of the yearand were in receipt of remuneration aggregating ` 850lakhs per month or more during the financial year ended31st March 2019
The information pursuant to Section 197 of the Act readwith Rule 5(2) and 5(3) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014containing the names of top 10 employees in terms ofremuneration drawn is provided in the Annexure formingpart of this report
The information required under Section 197(12) of the Actand the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is provided in theAnnexure forming part of this Report
FORWARD-LOOKING STATEMENTS
This Report contains forward-looking statements thatinvolve risks and uncertainties When used in this Reportthe words lsquoanticipatersquo lsquobelieversquo lsquoestimatersquo lsquoexpectrsquo lsquointendrsquolsquowillrsquo and other similar expressions as they relate to theCompany and or its Businesses are intended to identifysuch forward-looking statements The Companyundertakes no obligation to publicly update or revise anyforward-looking statements whether as a result of newinformation future events or otherwise Actual resultsperformances or achievements could differ materially fromthose expressed or implied in such forward-lookingstatements Readers are cautioned not to place unduereliance on these forward-looking statements that speakonly as of their dates This Report should be read inconjunction with the financial statements included hereinand the notes thereto
CONCLUSION
Your Directors and employees look forward to the futurewith confidence and stand committed to creating an evenbrighter future for all stakeholders
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
Steps taken by the Company for utilising alternate sourcesof energy NIL
Capital investment on energy conservation equipment NIL
Technology Absorption
i) Efforts in brief made towards technology absorptionand benefits derived as a result of the above effortseg product improvement cost reduction productdevelopment import substitution etc
Sl Description BenefitsNo
1 Upgradation of Fire Alarm and For Product UpgradationPublic Announcement system
2 Installation of Hoods and Fire For Product UpgradationSuppression system
3 Upgradation of CCTV monitoring For Product Upgradationsystem
4 Upgradation of Electrical Panel For Product Improvement5 Induction of Diesel Generator For Product Improvement
ii) In case of imported technology (imported during thelast 3 years reckoned from the beginning of the financialyear) following information may be furnished
A) Details of technology imported - NIL
B) Year of import - NIL
C) Whether the technology has been fully absorbed -NIL
D) If not fully absorbed areas where absorption hasnot taken place and the reasons therefor - NIL
iii) Expenditure incurred on research and development -NIL
FOREIGN EXCHANGE EARNINGS AND OUTGO
During the financial year 2018-19 foreign exchangeearnings of the Hotel aggregated ` 111754 lakhs (previousyear ` 95887 lakhs) while expenditure in foreign currencyaggregated ` 5514 lakhs (previous year ` 3230 lakhs)
EMPLOYEES
The total number of employees of the Company as on31st March 2019 stood at 198
26
ANNEXURE
FORM NO MR ndash 3SECRETARIAL AUDIT REPORTFOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019[Pursuant to Section 204(1) of the Companies Act 2013 and Rule9 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014]
ToThe MembersGujarat Hotels LimitedWe have conducted the secretarial audit of the compliance ofapplicable statutory provisions and the adherence to goodcorporate practices by Gujarat Hotels Limited a Companyincorporated under the provisions of the Companies Act 1956 andhaving its Registered Office at WelcomHotel Vadodara R C DuttRoad Alkapuri Vadodara Gujarat ndash 390 007 (hereinafter referredto as the lsquoCompanyrsquo) for the period commencing from 1st April2018 till 31st March 2019 (hereinafter referred to as the lsquoAuditPeriodrsquo) Secretarial Audit was conducted in a manner that providedus a reasonable basis for evaluating the corporate conducts statutory compliances and expressing our opinions thereonBased on our verification of the books papers minute booksforms and returns filed and other records maintained by theCompany and also the information provided by the Company itsofficers agents and authorised representatives during the conductof Secretarial Audit 2018-19 we hereby report that in our opinionthe Company has during the audit period covering the FinancialYear ended on 31st March 2019 complied with the statutoryprovisions listed hereunder and also that the Company has properBoard-processes and compliance-mechanism in place to theextent in the manner and subject to the reporting made hereinafterWe have examined the books papers minute books forms andreturns filed and other records maintained by the Company for thefinancial year ended on 31st March 2019 according to theprovisions of(i) The Companies Act 2013 (the Act) and the Rules made
thereunder(ii) The Securities Contracts (Regulation) Act 1956 (lsquoSCRArsquo)
and the Rules made thereunder(iii) The Depositories Act 1996 and the Regulations and
Bye-laws framed thereunder(iv) Foreign Exchange Management Act 1999 and the Rules and
Regulations made thereunder to the extent of Foreign DirectInvestment Overseas Direct Investment and ExternalCommercial Borrowings
(v) The following Regulations and Guidelines prescribed underthe Securities and Exchange Board of India Act 1992(lsquoSEBI Actrsquo)-(a) The Securities and Exchange Board of India
(Substantial Acquisition of Shares and Takeovers)Regulations 2011
(b) The Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations 2015
(c) The Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations2015
(d) The Securities and Exchange Board of India(Registrars to an Issue and Share Transfer Agents)Regulations 1993 regarding the Companies Act anddealing with client
We have also examined compliance with the applicable clauses ofthe following(i) The mandatory Secretarial Standards issued by The Institute
of Company Secretaries of India with respect to BoardMeetings and General Meetings
(ii) The SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015
The Company has entered into an Operating Licence Agreementwith ITC Limited which operates the Hotel ndash WelcomHotel Vadodraand ensure compliance of all laws as applicable for running andmaintenance of the HotelDuring the period under review the Company has complied withthe provisions of the Act Rules Regulations Guidelines andStandards etc as mentioned above however in the CorporateGovernance Report filed pursuant to Regulation 27(2) of SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015with BSE for the quarter ended September and December 2018there is mismatch of date of the meetingWe further report thatThe Board of Directors of the Company is duly constituted withproper balance of Non-Executive Directors and IndependentDirectors The changes in the composition of the Board of Directorsthat took place during the period under review were carried out incompliance with provisions of the ActAdequate notice is given to all Directors for the Board Meetingsand Committees Meetings agenda and detailed notes on agendawere sent at least seven days in advance and where the meetingwas held in shorter notice due compliance was made and a systemexists for seeking and obtaining further information and clarificationson the agenda items before the meeting for meaningful participationat the meetingAll decisions at Board Meetings and Committee Meetings werecarried out unanimously as recorded in the minutes of the meetingsof the Board of Directors or Committees of the Board as the casemay beWe report that there are adequate systems and processes in theCompany commensurate with the size and operations of theCompany to monitor and ensure compliance with the applicableLaws Rules Regulations and GuidelinesWe further report that during the Audit Period the Company has nospecific events actions that have a major bearing on the Companyrsquosaffairs in pursuance of the above referred Laws RulesRegulations Guidelines Standards etc
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
Note This report is to be read with our letter of even date whichis annexed as Annexure A and forms an integral part of thisreport
27
FORM NO AOC-2[Pursuant to Section 134(3)(h) of the Companies Act 2013 and Rule 8(2) of the Companies (Accounts) Rules 2014]
Form for disclosure of particulars of contracts arrangements entered into by the Company with related parties referred to insub-section (1) of Section 188 of the Companies Act 2013 including certain arms length transactions under fourth proviso thereto
1 Details of contracts or arrangements or transactions not at arms length basis
a) Name(s) of the related party and nature of relationshipb) Nature of contracts arrangements transactionsc) Duration of the contracts arrangements transactionsd) Salient terms of the contracts or arrangements or transactions including the value if anye) Justification for entering into such contracts or arrangements or transactions NILf ) Date(s) of approval by the Boardg) Amount paid as advances if anyh) Date on which the special resolution was passed in general meeting as required under first proviso to Section 188
2 Details of material contracts or arrangement or transactions at arms length basis
a) Name(s) of the related party and nature of ITC Limited of which the Company is an Associaterelationship
b) Nature of contracts arrangements transactions Agreement for operating the Companyrsquos Hotel
c) Duration of the contracts arrangements Operating License Agreement (OLA) dated 24th September 1992 for an initialtransactions period of 30 years and renewable for another period of 30 years The OLA
emanated from the rehabilitation package agreed amongst Gujarat State GovtFinancial Institutions viz IFCI amp SBI and ITC in the year 1990
d) Salient terms of the contracts or arrangements The Company receives Licence fees 15 of Net Operating Income Valueor transactions including the value if any of transaction during the year ` 370 crores
e) Date(s) of approval by the Board if any 24th September 1992f ) Amount paid as advances if any Nil
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Annexure AToThe MembersGujarat Hotels Limited
Our report of even date is to be read along with this letter
1 Maintenance of secretarial record is the responsibilityof the management of the Company Our responsibilityis to express an opinion on these secretarial recordsbased on our audit
2 We have followed the audit practices and processesas were appropriate to obtain reasonable assuranceabout the correctness of the contents of the secretarialrecords The verification was done on the randomtest basis to ensure that correct facts are reflected insecretarial records We believe that the processesand practices we followed provide a reasonablebasis for our opinion
3 W e have not verified the correctness andappropriateness of financial records and books ofaccounts of the Company
4 W herever required we have obtained theManagement Representation about the complianceof Laws Rules and Regulations and happening ofevents etc
5 The compliance of the provisions of corporate andother applicable Laws Rules RegulationsStandards is the responsibility of management Ourexamination was limited to the verification ofprocedures on the random test basis
6 The Secretarial Audit Report is neither an assuranceas to the future viability of the Company nor of theefficacy or effectiveness with which the managementhas conducted the affairs of the Company
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
28
INDEPENDENT AUDITORSrsquo CERTIFICATE ON CORPORATE GOVERNANCE
INDEPENDENT AUDITORrsquoS CERTIFICATE ON CORPORATEGOVERNANCE
TO THE MEMBERS OF GUJARAT HOTELS LIMITED
1 We have examined the compliance of conditions ofCorporate Governance by Gujarat Hotels Limited (ldquotheCompanyrdquo) for the year ended on 31st March 2019as stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the Securities and Exchange Board ofIndia (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended(ldquoSEBI Listing Regulationsrdquo)
Managementrsquos Responsibility
2 The compliance of conditions of CorporateGovernance is the responsibility of the ManagementThis responsibility includes the designimplementation and maintenance of internal controland procedures to ensure the compliance with theconditions of the Corporate Governance stipulated inSEBI Listing Regulations
Auditorrsquos Responsibility
3 Our responsibility is limited to examining theprocedures and implementation thereof adopted bythe Company for ensuring the compliance of theconditions of the Corporate Governance It is neitheran audit nor an expression of opinion on the financialstatements of the Company
4 We have examined the books of account and otherrelevant records and documents maintained by theCompany for the purpose of providing reasonableassurance on the compliance with CorporateGovernance requirements by the Company
5 We have carried out an examination of the relevantrecords of the Company in accordance with theGuidance Note on Certification of CorporateGovernance issued by the Institute of CharteredAccountants of India (ldquothe ICAIrdquo) the Standards onAuditing specified under Section 143(10) of theCompanies Act 2013 in so far as applicable for the
purpose of this certificate and as per the GuidanceNote on Reports or Certificates for Special Purposesissued by the ICAI which requires that we comply withthe ethical requirements of the Code of Ethics issuedby the ICAI
6 W e have complied with the relevant applicablerequirements of the Standard on Quality Control (SQC)1 Quality Control for Firms that Perform Audits andReviews of Historical Financial Information and otherAssurance and Related Services Engagements
Opinion
7 Based on our examination of the relevant recordsand according to the information and explanationsprovided to us and representations provided by theManagement we certify that the Company hascomplied with the conditions of Corporate Governanceas stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the SEBI Listing Regulations asapplicable for the year ended 31st March 2019
8 W e state that such compliance is neither anassurance as to the future viability of the Companynor the efficiency or effectiveness with which theManagement has conducted the affairs of theCompany
Restrictions on Use
9 This Certificate is issued solely for the purpose ofcomplying with the aforesaid SEBI ListingRegulations and may not be suitable for any otherpurpose
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
29
ANNEXURE
FORM NO MGT-9EXTRACT OF ANNUAL RETURN
as on the Financial Year ended on 31st March 2019[Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the
Companies (Management and Administration) Rules 2014]
I REGISTRATION AND OTHER DETAILS
i) CIN L55100GJ1982PLC005408ii) Registration Date 7th August 1982iii) Name of the Company Gujarat Hotels Limitediv) Category Sub-Category of the Company Public company - Limited by sharesv) Address of the Registered office and contact details WelcomHotel Vadodara
R C Dutt Road AlkapuriVadodara 390 007Tel No 0265-233 0033E-mail ghlinvestorsyahoocoin
vi) Whether Listed Company Yesvii) Name Address and Contact details of MCS Share Transfer Agent Limited
Registrar and Transfer Agent if any F - 65 Okhla Industrial Area Phase - INew Delhi - 110 020Tel Nos (011) 4140 6149-52 4160 9386
II PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY
III PARTICULARS OF HOLDING SUBSIDIARY AND ASSOCIATE COMPANIES NIL
Sl No
Name and Description of main products services NIC Code of the products services
to total turnover of the Company
1 Hotel Services 55101 100
30
IV SHAREHOLDING PATTERN (Equity Share Capital Break-up as percentage of Total Equity)(i) Category-wise Shareholding
Category of Shareholders No of Shares held at the beginningof the year
No of Shares held at the endof the year
Changeduring the
year
A Promoters(1) Indiana) Individual HUF 0 0 0 0 0 0 0 0 0b) Central Govt 0 0 0 0 0 0 0 0 0c) State Govt(s) 0 0 0 0 0 0 0 0 0d) Bodies Corp 2033963 0 2033963 5370 2033963 0 2033963 5370 0e) Banks FI 0 0 0 0 0 0 0 0 0f ) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(1) 2033963 0 2033963 5370 2033963 0 2033963 5370 0(2) Foreigna) NRIs - Individuals 0 0 0 0 0 0 0 0 0b) Other - Individuals 0 0 0 0 0 0 0 0 0c) Bodies Corp 0 0 0 0 0 0 0 0 0d) Banks FI 0 0 0 0 0 0 0 0 0e) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(2) 0 0 0 0 0 0 0 0 0Total Shareholding of Promoter(A) = (A)(1)+(A)(2) 2033963 0 2033963 5370 2033963 0 2033963 5370 0B Public Shareholding1 Institutionsa) Mutual Funds 0 0 0 0 0 0 0 0 0b) Banks FI 0 100 100 0 100 100 c) Central Govt 0 0 0 0 0 0 0 0 0d) State Govt(s) 0 0 0 0 0 0 0 0 0e) Venture Capital Funds 0 0 0 0 0 0 0 0 0f ) Insurance Companies 0 0 0 0 0 0 0 0 0g) FIIs 10 0 10 0 0 0 h) Foreign Venture Capital Funds 0 0 0 0 0 0 0 0 0i) Others (specify) 0 0 0 0 0 0 0 0 0Sub-total (B)(1) 10 100 110 0 100 100 2 Non-Institutionsa) Bodies Corpi) Indian 300003 2200 302203 798 191626 2100 193726 511 (287)ii) Overseas 0 0 0 0 0 0 0 0 0b) Individualsi) Individual shareholders holding
nominal share capital upto` 1 lakh 774322 231562 1005884 2656 797094 203602 1000696 2643 (013)
ii) Individual shareholders holdingnominal share capital inexcess of ` 1 lakh 220814 0 220814 583 334765 0 334765 884 301
c) Others (specify)i) Non Resident Individuals 44288 71500 115788 306 45662 56700 102362 270 (036)ii) Investor Education and
Protection Fund AuthorityMinistry of Corporate Affairs 108753 0 108753 287 121903 0 121903 322 035
Sub-total (B)(2) 1448180 305262 1753442 4630 1491050 262402 1753452 4630 0Total Public Shareholding(B)=(B)(1)+ (B)(2) 1448190 305362 1753552 4630 1491050 262502 1753552 4630 0C Shares held by Custodian
for GDRs amp ADRs 0 0 0 0 0 0 0 0 0Grand Total (A+B+C) 3482153 305362 3787515 100 3525013 262502 3787515 100 0
Demat Physical Total of TotalShares
Demat Physical Total of TotalShares
ANNEXURE
31
1 Savi Portfolio Management Services LimitedAt the beginning of the year 122218 323Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 122218 323
2 Muktilal Ganulal PaldiwalAt the beginning of the year 82742 218Increase Decrease in Shareholding during the year06042018 220 001 82962 21913042018 250 001 83212 22001062018 927 002 84139 22215062018 700 002 84839 22427072018 412 001 85251 22505102018 1000 003 86251 22830112018 500 001 86751 22931122018 958 003 87709 23218012019 124 000 87833 23208022019 1070 003 88903 23501032019 467 001 89370 23615032019 1000 003 90370 23922032019 200 001 90570 24031032019 50 000 90620 240At the end of the year 90620 240
3 Taradevi Muktilal PaldiwalAt the beginning of the year 31628 084
(ii) Shareholding of Promoters (including Promoter Group)
(iii) Change in Promotersrsquo Shareholding (please specify if there is no change)
SlNo
Shareholders NameNo of
Shares of total
Sharesof the
Company
of Sharespledged
encumbered tototal Shares
No ofShares
of totalShares
of theCompany
of Sharespledged
encumbered tototal Shares
change inShareholding
during the year
1 ITC Limited 1733907 4578 Nil 1733907 4578 Nil Nil
2 Russell Investments Limited 300056 792 Nil 300056 792 Nil Nil
Shareholding at the beginning of the year Shareholding at the end of the year
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
(iv) Shareholding Pattern of top ten Shareholders (other than Directors Promoters and Holders of GDRs and ADRs)
ANNEXURE
No of Shares
Sl No
Particulars Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares of total Shares of the Company
No of Shares of total Shares of the Company
At the beginning of the year
No Change during the year Increase Decrease in Promoters Shareholding during the year
At the end of the year
32
Increase Decrease in Shareholding during the year06042018 180 000 31808 08413042018 53 000 31861 08420042018 1449 004 33310 08827042018 1933 005 35243 09304052018 1060 003 36303 09611052018 2196 006 38499 10218052018 1343 004 39842 10625052018 1191 003 41033 10906072018 1600 004 42633 11313072018 1678 004 44311 11720072018 2095 006 46406 12327072018 3735 010 50141 13303082018 415 001 50556 13410082018 685 002 51241 13624082018 1169 003 52410 13931082018 1616 004 54026 14307092018 1655 004 55681 14714092018 1311 003 56992 15021092018 2480 007 59472 15729092018 2259 006 61731 16305102018 1534 004 63265 16712102018 976 003 64241 17019102018 64 000 64305 17026102018 600 002 64905 17202112018 605 002 65510 17409112018 4 000 65514 17416112018 143 000 65657 17430112018 2299 006 67956 18007122018 515 001 68471 18114122018 10 000 68481 18121122018 590 002 69071 18331122018 600 002 69671 18504012019 1000 003 70671 18825012019 21 000 70692 18801022019 701 002 71393 19008022019 388 001 71781 19115022019 714 002 72495 19301032019 700 002 73195 19515032019 34 000 73229 195At the end of the year 73299 195
4 Shah Viren ShantilalAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 14122018 26965 071
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
ANNEXURE
33
Increase Decrease in Shareholding during theyear ie wef 1412201811012019 28946 076 55911 14701022019 7194 019 63105 166At the end of the year 63105 166
5 Chirayush Pravin VakilAt the beginning of the year 27482 073Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 27482 073
6 Falguni Nilesh DedhiaAt the beginning of the year 18000 048Increase Decrease in Shareholding during the year27042018 5175 014 23175 062At the end of the year 23175 062
7 Classic Realties Private LimitedAt the beginning of the year 23061 061Increase Decrease in Shareholding during the year31082018 100 000 23161 061At the end of the year 23161 061
8 Dheeraj Kumar LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 20000 053
9 Karvy Stock Broking LimitedAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 30112018 23063 061Increase Decrease in Shareholding during theyear ie wef 3011201807122018 149 000 23212 06114122018 (8165) (022) 15047 03931122018 7128 019 22175 05804012019 3087 008 25262 06611012019 (23721) (063) 1541 00331032019 15274 040 16815 043At the end of the year 16815 043 Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company Includes shares acquired during the period when not part of the top ten Shareholders of the Company
10 Sonal LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year20042018 (1000) (003) 19000 050
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
34
311218 0 000 0 00011012019 0 000 0 00031032019 (5000) (013) 14000 037At the end of the year 14000 037 Ceased to be part of the top ten Shareholders of the Company Became a part of the top ten Shareholders of the Company
11 Rajasthan Global Securities Private LimitedAt the beginning of the year 98659 260Increase Decrease in Shareholding during the year20042018 (4756) (013) 93903 24727042018 (5596) (015) 88307 23206072018 (790) (002) 87517 23027072018 (8520) (022) 78997 20802112018 (10975) (029) 68022 17916112018 (4) 000 68018 17930112018 (6189) (016) 61829 16307122018 (170) 000 61659 16314122018 (18503) (049) 43156 11421122018 (417) (001) 42739 11331122018 (11108) (029) 31631 08404012019 (5000) (013) 26631 07111012019 (5000) (013) 21631 05825012019 (2800) (007) 18831 05101022019 0 000 0 000At the end of the year NA NA Ceased to be a part of the top ten Shareholders of the Company
12 Dinesh Mukilal PaldiwalAt the beginning of the year 10522 028Increase Decrease in Shareholding during the year03082018 112 000 10634 02810082018 424 001 11058 02907092018 500 001 11558 03021092018 85 000 11643 03005102018 1000 003 12643 03302112018 0 000 12643 03301022019 0 000 12643 03315022019 300 001 12943 03431032019 0 000 12943 034At the end of the year NA NA Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company
Note Increase decrease in shareholding as indicated above are based on downloads of beneficial ownership provided by the Depositories generally everyFriday
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
35
(v) Shareholding of Directors and Key Managerial Personnel
ANNEXURE
Ms D R Choudhury Messrs C K Koshy R C Mehta M Narayanan and J Singh Directors Messrs M Agarwal andD K Gulati Key Managerial Personnel did not hold any Shares of the Company either at the beginning or at the end of theyear or at any time during the year
Mr K Pahwa Chief Executive Officer also did not hold any Shares of the Company either at the time of his appointment or atthe end of the year or at any time during the year
V INDEBTEDNESSIndebtedness of the Company including interest outstanding accrued but not due for payment NIL
VI REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNELA Remuneration to Managing Director Wholetime Directors and or Manager NOT APPLICABLE
B Remuneration to the other Directors(Amount in `)
Ceased to be Non-Executive Independent Director with close of work on 31st March 2019
Sl No For each of the Director
Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares held singly
jointly
of total Shares of the
Company
No of Shares held singly
jointly
of total Shares of the
Company
1 N Anand (Chairman)
At the beginning of the year 200 0
Increase Decrease in Shareholding during the year
0 0 0 0
At the end of the year 200 0
Sl No Directors
Particulars of Remuneration
Total Amount Fee for attending Board Board
Committee Meetings
Commission Independent Directors
Meeting Fees 1 Independent Directors
C K Koshy 140000 0 10000 150000 R C Mehta 70000 0 0 70000 M Narayanan 140000 0 10000 150000
Total (B)(1) 350000 0 20000 370000 2 Other Non-Executive Directors
N Anand 0 0 0 0 D R Choudhury 0 0 0 0 J Singh 0 0 0 0
Total (B)(2) 0 0 0 0 Total (B) = (B)(1) + (B)(2) 370000 Total Managerial Remuneration (A+B) 370000
Overall ceiling as per the Act (Being 11 of the Net Profits of the Company as calculated under Section 198 of the Companies Act 2013)
3759620
36
C Remuneration to Key Managerial Personnel other than MD Manager WTD(Amount in `)
Mr K Pahwa was appointed as Chief Executive Officer wef 1st February 2019
VII PENALTIES PUNISHMENT COMPOUNDING OF OFFENCES
against the Company Directors and other Officers in Default under the Companies Act 2013 NONE
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Sl No
Particulars of Remuneration Key Managerial Personnel
Total Amount
K Pahwa Chief Executive
Officer
M Agarwal Chief Financial
Officer
D K Gulati Company Secretary
1 Gross Salary
(a) Salary as per provisions contained in Section 17(1) of the Income-tax Act 1961
377472 2883242 880140 4140854
(b) Value of perquisites under Section 17(2) of the Income-tax Act 1961
242908 136154 0 379062
(c) Profits in lieu of salary under Section 17(3) of the Income-tax Act 1961
0 0 0 0
2 Stock Option 0 0 0 0 3 Sweat Equity 0 0 0 0 4 Commission
- as of profit - others specify
0 0 0 0
5 Others please specify 0 0 0 0 Total Amount 620380 3019396 880140 4519916
37
Services reverted to ITC Limited effective 17th December 2018 Reflects revision in remuneration effective 1st October 2018
Notes1 The number of permanent employees as on 31st March 2019 was 1982 Compared to 2017-18 the figures for 2018-19 reflect that
i) Median remuneration of employees - Increased by 965ii) Average remuneration of employees excluding Key Managerial Personnel (KMP) - Increased by 1040 with
increase in number of employeesiii) Remuneration of KMP - Increased by 1321 due to revision in remuneration during the year
3 Remuneration of Directors KMP and other employees is in accordance with the Companys Remuneration Policy
A Information pursuant to Section 197 of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014
Name of Directors ampKey ManagerialPersonnel
Designation Ratio of Remuneration toMedian Remuneration of
all employees
Increase inRemuneration over
LY ()
ANNEXURE
N Anand Non-Executive Chairman - -
D R Choudhury Non-Executive Director - -
C K Koshy Independent Director 0731 7
R C Mehta Independent Director 0341 -
M Narayanan Independent Director 0731 7
J Singh Non-Executive Director - -
D Rana Chief Executive Officer 12681 (15)
K Pahwa Chief Executive Officer (wef 1st February 2019) 3111 -
M Agarwal Chief Financial Officer 15281 24
D K Gulati Company Secretary 4371 8
38
O
n de
puta
tion
from
ITC
Lim
ited
(ITC
)
Ser
vice
s re
verte
d to
ITC
effe
ctiv
e 17
th D
ecem
ber
2018
N
otes
a
Gro
ss r
emun
erat
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incl
udes
sal
ary
var
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e pa
y C
ompa
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con
tribu
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to p
rovi
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llow
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t w
hich
are
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eter
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n an
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rall
Com
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bas
is
The
ter
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emun
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has
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e ne
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Dire
ctor
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n 19
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ct 2
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eria
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ules
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lf of
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rd
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ce
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ingh
Dat
e 1
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Apr
il 2
019
Dire
ctor
Dire
ctor
Desig
natio
nGr
oss
Rem
uner
atio
n(`
)
Net
Rem
uner
atio
n(`
)
Quali
ficat
ions
Date
ofco
mmen
ceme
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empl
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ent
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tatio
n
Prev
ious
Em
ploy
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t Po
sitio
n He
ld
34
56
78
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Expe
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e(Y
ears
)Na
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e
12
Top
ten
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oyee
s in
term
s of r
emun
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ion
draw
nMa
yur A
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al33
Chief
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ncial
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er31
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2466
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A
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9
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ITC
Limite
dC
SMa
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r - Fi
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eDe
epen
dra R
ana
38
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e Of
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tel
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ited
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l Man
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ak K
umar
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any
Secr
etary
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m
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S
701
0720
15Re
ligar
e Sec
uritie
s Lim
ited
LLB
Ma
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ompli
ance
Rosh
an Ja
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ajan
31As
sistan
t Man
ager
7366
8164
6118
BB
A P
GD
M
501
0320
18Th
e Fer
n Hote
l(M
arke
ting)
Sales
Man
ager
Kuna
l Pah
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37Ch
ief E
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ral M
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4183
8535
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m
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0519
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Limite
dFr
ont o
ffice A
ssist
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Rajar
am K
ashir
am B
abar
52Se
nior E
xecu
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4175
8231
7347
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m
2201
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16Ho
tel K
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4010
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6903
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r Ex
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any
Weld
er
INFORMATION US 197 OF THE COMPANIES ACT 2013
39
CEO AND CFO COMPLIANCE CERTIFICATE
We Kunal Pahwa Chief Executive Officer and Mayur Agarwal Chief Financial Officer certify that
a) We have reviewed the financial statements including the cash flow statement for the year ended 31st March 2019 andto the best of our knowledge and belief
i) these statements do not contain any materially untrue statement or omit any material fact or contain statementsthat might be misleading
ii) these statements together present a true and fair view of the Companyrsquos affairs and are in compliance with IndianAccounting Standards applicable laws and regulations
b) To the best of our knowledge and belief no transactions entered into by the Company during the year ended31st March 2019 are fraudulent illegal or violative of the Companyrsquos code of conduct
c) We accept responsibility for establishing and maintaining internal controls for financial reporting and we have evaluatedthe effectiveness of the internal control systems of the Company pertaining to financial reporting Deficiencies in thedesign or operation of such internal controls if any of which we are aware have been disclosed to the auditors and theAudit Committee and steps have been taken to rectify these deficiencies
d) i) There has not been any significant change in internal control over financial reporting during the year underreference
ii) The changes in the Significant Accounting Policies arising from the adoption of the Indian Accounting Standardshave been discussed with the auditors and have been approved by the Audit Committee and
iii) We are not aware of any instance during the year of significant fraud with involvement therein of the managementor any employee having a significant role in the Companyrsquos internal control system over financial reporting
Place New Delhi Kunal Pahwa Mayur AgarwalDate 15th April 2019 Chief Executive Officer Chief Financial Officer
40
BALANCE SHEET
As at 31st March 2019Amount in `
Particulars Note As at As at31st March 2019 31st March 2018
ASSETSNon-Current Assetsa) Property Plant and Equipment 2 14695652 15623727b) Other Non-Current Assets 3 6672434 7609451Total Non-Current Assets 21368086 23233178Current Assetsa) Financial Assets
(i) Investments 4 280294894 208482957(ii) Trade Receivables 5 16310661 14154244(iii) Cash and Cash Equivalents 6 763039 900355(iv) Other Bank Balances 7 5489856 53182631(v) Other Financial Assets 8 4724316 6349124
b) Other Current Assets 3 437564 406324Total Current Assets 308020330 283475635Total Assets 329388416 306708813EQUITY AND LIABILITIESEquitya) Equity Share Capital 9 37875150 37875150b) Other Equity 268275037 243468594Total Equity 306150187 281343744LIABILITIESNon-Current Liabilitiesa) Provisions 10 1399224 1270990b) Deferred Tax Liabilities (Net) 11 10745247 11364002Total Non-Current Liabilities 12144471 12634992Current Liabilitiesa) Financial Liabilities
(i) Trade Payablesa) Total outstanding dues of micro enterprises and
small enterprises ndash ndashb) Total outstanding dues of creditors other than
micro enterprises and small enterprises 483074 395920(ii) Other Financial Liabilities 12 9272344 11118126
b) Other Current Liabilities 13 1264039 1172866c) Provisions 10 74301 43165Total Current Liabilities 11093758 12730077Total Equity And Liabilities 329388416 306708813
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
41
STATEMENT OF PROFIT AND LOSS
For the year ended 31st March 2019Amount in `
I Revenue From Operations 14 36986948 33098499
II Other Income 15 19625544 17119109
III Total Income (I+II) 56612492 50217608
IV EXPENSES
Employee Benefits Expense 16 1208580 1094609
Depreciation and Amortization Expense 473636 475984
Other Expenses 17 3107913 3334087
Total Expenses (IV) 4790129 4904680
V Profit Before Tax (III- IV) 51822363 45312928
VI Tax Expense
Current Tax 18 11653499 9272310
Deferred Tax 18 (618755) 2350502
VII Profit for the Year (V-VI) 40787619 33690116
VIII Other Comprehensive Income ndash ndash
IX Total Comprehensive Income for the Year (VII+VIII) 40787619 33690116
X Earnings per Equity Share (Face Value ` 10-each) 19
Basic (in `) 1077 890
Diluted (in `) 1077 890
For the Year For the YearParticulars Note ended ended
31st March 2019 31st March 2018
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
42
For the year ended 31st March 2019
STATEMENT OF CHANGES IN EQUITY
The Board of Directors of the Company recommended a dividend of ` 35 per share (for the year ended 31st March 2018 - dividend ` 350 pershare) be paid on fully paid equity shares This equity dividend is subject to approval by shareholders at the Annual General MeetingThe totalequity dividend to be paid ` 13256303 (for the year ended 31st March 2018 - dividend ` 13256303) Income tax on proposed dividend being` 2724873 (for the year ended 31st March 2018 - ` 2724873)
General Reserve This Reserve is created by an appropriation from one component of equity (generally retained earnings) to another notbeing an item of Other Comprehensive Income The same can be utilized by the Company in accordance with the provisions of the CompaniesAct 2013
Retained Earnings This Reserve represents the cumulative profits of the Company This Reserve can be utilized in accordance with theprovisions of the Companies Act 2013
The accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even dateOn behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
A Equity Share CapitalAmount in `
Balance as at the Changes in equity Balance at thebeginning of the share capital end of the
reporting year during the year reporting yearFor the year ended 31st March 2018 37875150 ndash 37875150For the year ended 31st March 2019 37875150 ndash 37875150
B Other EquityAmount in `
Reserves amp Surplus TotalGeneral Reserve Retained Earnings
Balance as at April 01 2017 30257504 195873461 226130965Total Comprehensive Income for the year ndash 33690116 33690116Dividend ndash 13256303 13256303Income Tax on Dividend Paid ndash 2698671 2698671Dividend Distribution Tax (earlier year) ndash 397513 397513Balance as at March 31 2018 30257504 213211090 243468594Balance as at April 01 2018 30257504 213211090 243468594Total Comprehensive Income for the year ndash 40787619 40787619Dividend ndash 13256303 13256303Income Tax on Dividend Paid 2724873 2724873Balance as at March 31 2019 30257504 238017533 268275037
43
CASH FLOW STATEMENT
For the year ended 31st March 2019
For the Year For the YearParticulars ended ended
31st March 2019 31st March 2018
NOTES1) The above Cash Flow Statement has been prepared under the ldquoIndirect Methodrdquo as set out in Ind AS 7Statement of Cash FlowsrdquoThe accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even date On behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
Amount in `
A Cash Flow from Operating ActivitiesPROFIT BEFORE TAX 51822363 45312928Adjustments for
Depreciation amp Amortisation expense 473636 475984Interest Income (1317822) (3453950)Dividend Income (159984) (178075)Loss on sale of property plant and equipment - Net 445778 (28273)Net gain(loss) on investments mandatorily measuredat fair value through profit or loss (18005340) (13358789)Other Non Operating Income ndash (86856)Other Non Operating Expense ndash 99378
OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 33258631 28782347Adjustments for
Trade Receivables Financial Assets and Other Assets (2815198) (90661)Trade Payables Other Liabilities and Provisions (1568800) 1700052
CASH GENERATED FROM OPERATIONS 28874633 30391738Income Tax Paid(Net) (10407981) (12740273)
NET CASH FROM OPERATING ACTIVITIES 18466652 17651465B Cash Flow from Investing Activities
Sale of Property Plant and Equipment 8661 58452Purchase of Current Investments (224340000) (186220000)SaleRedemption of Current Investments 170532754 183295529Dividend Income 159984 178075Interest Received 3262318 4031382
NET CASH FROM INVESTING ACTIVITIES (50376283) 1343438C Cash Flow from Financing Activities
Dividend Paid (13256303) (13256303)Income Tax on Dividend Paid (2724873) (2698671)
NET CASH FROM FINANCING ACTIVITIES (15981176) (15954974)NET INCREASE IN CASH AND CASH EQUIVALENTS (47890807) 3039929OPENING CASH AND CASH EQUIVALENTS 48653846 45613917CLOSING CASH AND CASH EQUIVALENTS 763039 48653846
CASH AND CASH EQUIVALENTS COMPRISE Cash cheques and current accounts 763039 900355Other Bank BalancesDeposits with original maturity more than 3 months having remainingmaturity less than 12 months from Balance Sheet date ndash 47753491
763039 48653846
44
1 SIGNIFICANT ACCOUNTING POLICIESStatement of ComplianceThese financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) notifiedunder section 133 of the Companies Act 2013 (the Act) read with Companies (Indian Accounting Standards)Rules 2015 (as amended) The financial statements have also been prepared in accordance with the relevantpresentation requirements of the Companies Act 2013
Basis of PreparationThe financial statements are prepared in accordance with the historical cost convention except for certain itemsthat are measured at fair values as explained in the accounting policies below The financial statements arepresented in Indian Rupees (INR) which is also the Companyrsquos functional currency
Fair Value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transactionbetween market participants at the measurement date regardless of whether that price is directly observable orestimated using another valuation technique In estimating the fair value of an asset or a liability the Companytakes into account the characteristics of the asset or liability if market participants would take those characteristicsinto account when pricing the asset or liability at the measurement date
The preparation of financial statements in conformity with Ind AS requires management to make judgementsestimates and assumptions that affect the application of the accounting policies and the reported amounts ofassets and liabilities the disclosure of contingent assets and liabilities at the date of the financial statementsand the reported amounts of revenues and expenses during the year Actual results could differ from those estimatesThe estimates and underlying assumptions are reviewed on an ongoing basis Revisions to accounting estimatesare recognised in the period in which the estimate is revised if the revision affects only that period they arerecognised in the period of the revision and future periods if the revision affects both current and future periods
All assets and liabilities have been classified as current or non-current as per the Companyrsquos normal operatingcycle and other criteria set out in the Schedule III to the Companies Act 2013 and Ind AS 1 ndash Presentation ofFinancial Statements based on the nature of business and the time between the acquisition of assets for processingand their realisation in cash and cash equivalents
Property Plant amp Equipment ndash Tangible AssetsProperty plant amp equipment are stated at cost of acquisition or construction less accumulated depreciation andimpairment if any For this purpose cost includes deemed cost which represents the carrying value of propertyplant and equipment recognised as at 1st April 2015 measured as per the previous GAAP
Cost is inclusive of inward freight duties and taxes and incidental expenses related to acquisition In respect ofmajor projects involving construction related pre-operational expenses form part of the value of assets capitalisedExpenses capitalised also include applicable borrowing costs for qualifying assets if any Subsequent costs areincluded in the assetrsquos carrying amount only when it meets the recognition criteria are met as per componentaccounting The carrying amount of a replaced part is derecognized All other repairs and maintenance are chargedto the statement of Profit amp Loss
An item of property plant and equipment is derecognized upon disposal or when no future economic benefits areexpected to arise from the continued use of asset Any gain or loss arising on the disposal or retirement of an itemof property plant and equipment is determined as the difference between the sales proceeds and the carryingamount of the asset and is recognised in Statement of Profit and Loss
Depreciation of these assets commences when the assets are ready for their intended use which is generally oncommissioning Items of Property Plant and Equipment are depreciated in a manner that depreciates the cost ofthe assets after commissioning (or other amount substituted for cost) less its residual value over their usefullives as specified in Schedule II of the Companies Act 2013 on a straight line basis
Property plant and equipmentrsquosrsquo residual values and useful lives are reviewed at each balance sheet date andchanges if any are treated as changes in accounting estimate
NOTES TO THE FINANCIAL STATEMENTS
45
NOTES TO THE FINANCIAL STATEMENTS
Useful lives of different class of PPE are as follows
Particulars Useful Life as per Schedule IIBuilding 60 Years
Plant and Equipment 15 Years
Furnitures and fixtures 8 years
Office equipment 5 Years
Impairment of AssetsImpairment loss is provided if any to the extent the carrying amount of assets or cash generating units exceedtheir recoverable amount
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amountmay not be recoverable
Recoverable amount is higher of an assetrsquos net selling price and its value in use Value in use is the present valueof estimated future cash flows expected to arise from the continuing use of an asset or cash generating unit andfrom its disposal at the end of its useful life
Impairment losses recognised in prior years are reversed when there is an indication that the impairment lossesrecognised no longer exist or have decreased Such reversals are recognised as an increase in carrying amountsof assets to the extent that it does not exceed the carrying amounts that would have been determined (net ofamortisation or depreciation) had no impairment loss been recognised in previous years
Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodiedin the asset are considered to modify the amortisation period or method as appropriate and are treated aschanges in accounting estimates
Financial instruments Financial Assets and Financial LiabilitiesFinancial assets and financial liabilities are recognized when the Company becomes a party to the contractualprovisions of the relevant instrument Transaction cost that are directly attributable to the acquisition or issue offinancial assets and financial liabilities (other than financial assets and financial liabilities measured at fair valuethrough profit or loss) are added to or deducted from the fair value on initial recognition of financial assets andfinancial liabilities Purchase or sale of financial assets that require delivery of assets within a time frame establishedby regulation or convention in the market place (regular way trades) are recognized on the trade date ie the datewhen the Company commits to purchase or sell the asset
Financial AssetsRecognition Financial assets includes Investments Trade receivable Advances Security Deposits Cash andcash equivalents Such Assets are initially recognized at transaction price when the company becomes party tocontractual obligations The transaction price includes transaction cost unless the assets is being fair valuedthrough the Statement of Profit and Loss
Classification Management determines the classification of an asset at initial recognition depending on thepurpose for which the assets were acquired The subsequent measurement of financial assets depends on suchclassification
Financial assets are classified as those measured at
(a) Amortised cost where the financial assets are held solely for collection of cash flows arising from payments ofprincipal and or interest
(b) Fair value through other comprehensive income (FVTOCI) where the financial assets are held not only forcollection of cash flows arising from payments of principal and interest but also from the sale of such assetsSuch assets are subsequently measured at fair value with unrealised gains and losses arising from changesin the fair value being recognised in other comprehensive income
46
NOTES TO THE FINANCIAL STATEMENTS
(c) Fair value through profit or loss (FVTPL) where the assets are managed in accordance with an approvedinvestment strategy that triggers purchase and sale decision based on fair value of such assets Such assetsare subsequently measured at fair value with unrealized gain and losses arising from changes in the fair valuebeing recognised in the Statement of Profit and Loss in the period in which they arise
Trade receivable Advances Security Deposits Cash and Cash equivalents etc are classified for measurementat amortised cost while Investment have been classified for measurement at Fair value through profit or loss(FVTPL)
Impairment The Company assesses at each reporting date whether a financial asset (or group of financialassets) such as investment trade receivable advances and security deposit held at amortised cost are tested forimpairment based on evidence or information that is available without undue cost or effort Expected credit lossesare assessed and loss allowances recognized if the credit quality of the financial asset has deteriorated significantlysince initial recognition
Reclassification When and only when the business model is changed the Company shall reclassify all affectedfinancial assets prospectively from the reclassification date as subsequently measured at amortised cost fairvalue through profit or loss without restating the previously recognized gains or losses and in terms of thereclassification principles laid down in the Ind AS relating to Financial Instruments
De-recognition Financial assets are derecognized when the rights to receive benefits have expired or beentransferred and the Company has transferred substantially all risks and rewards of ownership of such financialasset
Financial LiabilitiesTrade payables and other financial liabilities are initially recognized at the value of the respective contractualobligations They are subsequently measured at amortised cost
Financial liabilities are derecognized when the liability is extinguished that is when the contractual obligation isdischarged cancelled or expires
Offsetting Financial InstrumentsFinancial assets and liabilities are offset and the net amount is included in the Balance Sheet where there is alegally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis orrealise the asset and settle the liability simultaneously
Revenue1 Revenue is measured at the fair value of the consideration received or receivable for services rendered net of
discounts to customers and excludes taxes such as Goods and Services Tax Revenue from the sale ofservices is recognised when the Company performs its obligations to its customers and the amount of revenuecan be measured reliably and recovery of the consideration is probable Income from operating license fees arerecognized on accrual basis in accordance with Operating License agreement The timing of such revenuerecognition is in the periods in which such services are rendered
2 Interest Income is booked in the Statement of Profit and Loss using the effective interest method
3 Dividend Income is recognised in the Statement of Profit and Loss when the right to receive dividend is established
Employee BenefitsThe Company makes contributions to both defined benefit and defined contribution schemes
Contributions to Provident Fund are in the nature of defined contribution scheme and such paidpayable amountsare charged against revenue The contributions in respect of provident fund and family pension are statutorilydeposited with the Government
The Company also makes contribution to defined benefit gratuity plan The cost of providing benefits under thedefined benefit obligation is calculated by independent actuary using the projected unit credit method The Companyhas taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liability with respect to the
47
NOTES TO THE FINANCIAL STATEMENTS
employees and the premium paid to LIC is charged to Statement of Profit amp Loss The difference between theactuarial valuation of the gratuity with respect to employees at the year-end and the contribution paid to LIC isfurther adjusted in the books of accounts
Employees Benefit wrt Leave Encashment is considered as Employees Long Term Benefit for which the Companyrecords the liability based on actuarial valuation computed under projected unit credit method These benefits areunfunded
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee as per the Operating LicenseAgreement
Taxes on IncomeTaxes on income comprises of current tax and deferred tax Current tax in the Statement of Profit and Loss isprovided as the amount of tax payable in respect of taxable income for the period using tax rates and tax lawsenacted during the period together with any adjustment to tax payable in respect of previous years
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities andthe amounts used for taxation purposes (tax base) at the tax rates and tax laws enacted or substantively enactedby the end of the reporting period
Deferred tax assets are recognized for the future tax consequences to the extent it is probable that future taxableprofits will be available against which the deductible temporary differences can be utilized
Deferred tax assets and liabilities are offset when there is legally enforceable right to offset current tax assets andliabilities and when the deferred tax balances relate to the same taxation authority Current tax assets and taxliabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on netbasis or to realize the asset and settle the liability simultaneously
Dividend DistributionDividends paid (including income tax thereon) is recognised in the financial statements in the period in which inwhich the interim dividends are approved by the Board of Directors or in respect of the Companyrsquos final dividendfor the year when the same are approved by shareholders of the Company
Provisions and Contingent LiabilitiesProvisions are recognized when the Company has a present obligation (legal or constructive) as a result of a pastevent it is probable that an outflow of resources will be required to settle the obligation and the amount can bereliably estimated The amount so recognized is the best estimate of the consideration required to settle theobligation at the reporting date taking in to account the risks and uncertainties surrounding the obligation Adisclosure for a contingent liability is made when there is possible obligation or a present obligation that may butprobably will not require an outflow of resources Where there is possible obligation or a present obligation inrespect of which the likelihood of outflow of resources is remote no provision or disclosure is made
Use of Estimates and JudgementsThe key estimates and assumption used in the preparation of financial statements are set out below
Actuarial ValuationThe determination of Companyrsquos liability towards defined benefit obligation to employees is made through independentactuarial valuation including determination of amounts to be recognized in the Statement of Profit and Loss and inother comprehensive income Such valuation depend upon assumptions determined after taking into accountinflation seniority promotion and other relevant factors such as supply and demand factors in the employmentmarket Information about such valuation is provided in notes to the financial statements
ComparativesWhen required by Ind AS comparative figures have been adjusted to conform to changes in presentation for thecurrent financial year
48
2P
rope
rty
Pla
nt a
nd E
quip
men
tA
mou
nt i
n `
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
Gros
s Bl
ock
Depr
eciat
on
Amor
tisati
onNe
t Blo
ck
Parti
cula
rsWi
thdraw
alWi
thdraw
alWi
thdraw
alWi
thdraw
alAp
ril 1
and
Marc
h 31
an
dMa
rch
31
April
1Fo
r the
and
March
31
For t
hean
dMa
rch
31
Marc
h 31
Ma
rch
31
2017
Addi
tions
Adjus
tmen
t20
18Ad
ditio
nsAd
justm
ent
2019
2017
year
Adjus
tmen
t20
18ye
arAd
justm
ent
2019
2019
2018
Tang
ible
Ass
ets
Build
ing
161
88
565
-16
188
565
-2
668
831
592
168
29
561
564
759
84-1
432
140
473
636
290
5518
76
721
140
44
961
147
56
425
Plan
t and
Equ
ipmen
t7
637
0120
716
742
985
-2
047
935
381
92-
--
--
--
538
192
742
985
Furn
iture
and
Fixt
ures
1
278
845
584
122
300
-11
818
110
482
--
--
--
-1
104
821
223
00
Offic
e Eq
uipme
nt2
017
-2
017
--
201
7-
--
--
--
201
72
017
Tota
l1
708
216
7-
263
001
705
586
7-
483
494
165
72
373
956
156
475
984
-14
321
404
736
3629
055
187
672
11
469
565
21
562
372
7
Full
y de
prec
iated
ass
ets
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
49
NOTES TO THE FINANCIAL STATEMENTS
Amount in `Particulars As at 31st March 2019 As at 31st March 2018
Current Non-Current Current Non-Current3 OTHER ASSETS
Advances other than capital advancesSecurity Deposit- With Others 2328947 2328947- Statutory Authorities 200000Other Advances (prepaid expenses) 437564 ndash 406324 ndashAdvance Tax (Net of Provisions) 4143487 5280504TOTAL 437564 6672434 406324 7609451
4 Current investments (at fair value through profit or loss unless otherwise stated) Amount in `Sl Investments in Mutual Funds As at 31st March 2019 As at 31st March 2018No
Name of Plan Unquoted Unquoted1 DHFL Pramerica Ultra Short Term Fund Nil (2018 - 1040731248)
Units of ` 1000 each ndash 219455882 ICICI Prudential Banking amp PSU Debt Fund 1124750948 Units
(2018 - 1124750948) of ` 1000 each 23872614 224702743 ICICI Prudential Corporate Bond Fund 1241451718 Units
(2018 - 1241451718) of ` 1000 each 23712100 221226704 UTI Floating Rate Fund Short Term Fund 7749911 Units
(2018-7749911) of ` 100000 each 23474167 218899535 SBI Magnum Instacash Nil Units (2018-3177849) of ` 100000 each ndash 70220186 Aditya Birla Sun Life Floating Rate Fund-Long Term 274475933 Units
(2018-319824542) Units of ` 10000 each 63614941 686675207 Aditya Birla Sunlife Saving Fund 137924934 Units (2018-129174683)
Units of ` 10000 each 51171946 443649348 Kotak Savings Fund 1128273230 Units (2018-Nil) of ` 1000 each 33816154 ndash9 Reliance Liquid Fund 11416769 Units (2018- Nil) of ` 100000 each 51823115 ndash10 ICICI Prudential Liquid Fund 57413509 Units (2018- Nil) of ` 10000 each 8809857 ndash
Aggregate amount of unquoted Investments 280294894 208482957TOTAL 280294894 208482957
Amount in `As at As at
31st March 2019 31st March 20185 TRADE RECEIVABLES
Unsecured Considered Good 16310661 14154244TOTAL 16310661 14154244
6 CASH AND CASH EQUIVALENTS Balances with Banks
Current Accounts 760024 900355Cash on Hand 3015 ndashTOTAL 763039 900355 Cash and cash equivalents include cash on hand cheques drafts on hand cash at bank and deposits with banks with original maturityof 3 months or less
7 OTHER BANKS BALANCESEarmarked balances 5489856 5429140On Deposit Accounts ndash 47753491TOTAL 5489856 53182631
Represents deposits with original maturity of more than 3 months having remaining maturity of less than 12 months from the Balance Sheet date
50
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
8 OTHER FINANCIAL ASSETSInterest accrued on Deposits 158000 2210348Others - Unsecured considered good 4566316 4138776TOTAL 4724316 6349124
As at As at As at As at31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of ` (No of `
Shares) Shares)9 EQUITY SHARE CAPITAL
AuthorisedEquity Shares of ` 10- each 10000000 100000000 10000000 100000000Issued Subscribed and Paid upEquity Shares of ` 10- each fully paid 3787515 37875150 3787515 37875150
A) Reconciliation of the number of Equity Shares outstanding31st March 31st March
2019 2018As at the beginning of the year 3787515 3787515Add - Shares issued during the year ndash ndashLess -Shares bought back during the year ndash ndashAs at the end of the year 3787515 3787515
B) Shareholders holding more than 5 of the As at As at As at As atEquity Shares in the Company 31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of (No of
Shares) Shares)ITC Limited 1733907 4578 1733907 4578Russell Investments Limited 300056 792 300056 792
C) Rights Preferences and Restrictions attached to the Equity SharesThe Equity Shares of the Company having par value of ` 10 per share rank pari passu in all respects includingvoting rights and entitlement to dividend
D) There are no bonus issue or buy back of equity shares during the period of five years immediately preceding thereporting date
As at 31st March 2019 As at 31st March 2018Current Non-Current Current Non-Current
10 PROVISIONSProvision for Long Term Employee Benefits 74301 1399224 43165 1270990TOTAL 74301 1399224 43165 1270990
51
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
11 DEFERRED TAX LIABILITIES (NET)Deferred Tax Liabilities 10745247 11364002Total 10745247 11364002Movement in Deferred Tax LiabilitiesAssets Balances
For the year 2018-19 Balance as on Recognized in Balance as on1st April 2018 profit or loss 31st March 2019
Deferred Tax Liabilities in relation toOther timing differences
On Depreciation on PPE 4293876 (252926) 4040950On Gain on Investment at FVTPL 7070126 473819 7543945
Total Deferred Tax Liabilities 11364002 220893 11584895Deferred tax liabilities beforeMAT credit entitlement 11364002 220893 11584895Less MAT credit entitlement ndash 839648 839648Total Deferred Tax Liabilities (Net) 11364002 (618755) 10745247
For the year 2017-18 Balance as on Recognized in Balance as on1st April 2017 profit or loss 31st March 2018
Deferred Tax liabilitiesassets in relation toOther timing differences
On Depreciation on PPE 4383618 (89742) 4293876On Gain on Investment at FVTPL 4629882 2440244 7070126
Total Deferred Tax Liabilities (Net) 9013500 2350502 11364002
As at As at31st March 2019 31st March 2018
12 OTHER FINANCIAL LIABILITIES
Unpaid Dividend 5489856 5429140Employee Related 3782488 5688986TOTAL 9272344 11118126
13 OTHER CURRENT LIABILITIES
Statutory Liabilities 1264039 1172866TOTAL 1264039 1172866
52
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 201814 REVENUE FROM OPERATIONS
Operating License Fees 36986948 33098499TOTAL 36986948 33098499
15 OTHER INCOMEInterest Income- Deposit with Banks- Carried At Amortised Cost 1178600 3272160- Deposit Others 139222 181790Dividend Income on Investment measured at FVTPL 159984 178075Net Gain(Loss) on financial assets mandatorily measured at FVTPL 18005340 13358789Net Gain(Loss) on Disposal of Fixed Assets ndash 28273Other Non-Operating Income 142398 100022TOTAL 19625544 17119109
Includes 1120976- (2018 - 681882-) being net gain(loss) on sale of investments
16 EMPLOYEE BENEFITS EXPENSESalaries and Wages 42461991 38590070Contribution to Provident and Other Fund 4564892 3983444
47026883 42573514Less Recoveries madeReimbursements received (45818303) (41478905)TOTAL 1208580 1094609
17 OTHER EXPENSESAdvertising Sales Promotion 159768 158814Consultancy Professional fees 214842 253969Travelling amp Conveyance 810746 1096527Postage Telephone Stationery etc 366042 205049Miscellaneous Expenses 1556515 1619728TOTAL 3107913 3334087Miscellaneous expenses includes Auditors remuneration andexpenses Audit Fees 60000 60000Fees for other services 40000 ndash
18 INCOME TAX EXPENSESA Amount recognised in profit or loss
Current TaxIncome Tax for the Year 11504441 9481109Adjustments(Credits) related to previous year 149058 (208799)Total Current Tax 11653499 9272310Deferred TaxDeferred tax for the year 220893 2350502Mat Credit Entitlement (839648) ndashTotal Deferred Tax (618755) 2350502TOTAL 11034744 11622812
NOTES TO THE FINANCIAL STATEMENTSAmount in `
53
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 2018B Reconciliation of effective tax rate
Profit before tax 51822363 45312928Indian tax rate 2782 2755Income Tax expense calculated at 2782 (2018 2755) 14416981 12484845Effects ofndash Different tax rate on certain items (2922098) (756048)ndash Difference in taxable incomedeductible expense 9697 42609ndash Incomes that are not taxable in determining taxable profit (44508) (49064)Adjustments recognised in the current year in relation toCurrent tax of prior years (425328) (208799)Effect on deferred tax balances due to the change in income tax rate ndash 109269Income Tax recognised in profit or loss 11034744 11622812
The tax rate used for the year 2018-19 and 2017-18 reconciliations above is the corporate tax rate of 25 + surcharge 7 and education cess 4 (2017-18 3) payable on taxable profits under the Income Tax Act 1961
19 EARNINGS PER EQUITY SHAREProfit for the year 40787619 33690116Number of equity shares outstanding 3787515 3787515Basic and diluted earnings per share in (Face value ` 10- per share) 1077 890
20 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTSA The Company was allotted 8200 sq mtrs of land at Vadodara in 1984 and an additional land of 2548 sq mtrs
in 1988 at R C Dutt Road Alkapuri Vadodara through GIIC (Gujarat Industrial Investment Corporation) on sub-lease for a period 30 years on which the hotel Welcomhotel Vadodara was constructed Lease term of landadmeasuring 8200 Sq mtrs expired on 30092014 and of land admeasuring 2548 sq mtrs expired on 30112018
The High Court of Gujarat in pursuance of Writ petition filed by Company in April 2013 passed an Order onDecember 24 2014 restraining the State Government from disturbing the peaceful and actual possession ofthe Company over the hotel property in any manner The writ petition is pending for hearing
The Company have made necessary application to State Government for Conversion of land from Leasehold toFreehold or Extension of Lease which is in process
B There are no Micro Small and Medium Enterprises to whom the Company owes dues which are outstandingfor more than 45 days during the year and also as at 31st March 2019 This information as required to bedisclosed under the Micro Small and Medium Enterprises Development Act 2006 has been determined tothe extent such parties have been identified on the basis of information available with the Company
C The Company operates in one segment ie Hoteliering and within one geographical segment ie India
D Defined Benefit Plan
The Company has taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liabilitywith respect to the employees and the premium paid to LIC is charged to Statement of Profit amp Loss Thedifference between the actuarial valuation of the gratuity with respect to employees at the year-end and thecontribution paid to LIC is further adjusted in the books of accounts
The accounting charge for benefits under the defined benefit obligation is calculated by independent actuaryusing the projected unit credit method
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee (ITC Limited) as per theOperating License Agreement hence no effect on Statement of Profit amp Loss and Other Comprehensive
54
NOTES TO THE FINANCIAL STATEMENTS
Income
Risk ManagementThe defined Benefit Plan expose the company to risk of actuarial deficit arising out of investment risk interestrate risk and salary cost inflation riskInvestment Risks This may arise from volatility in asset values due to market fluctuations and impairment ofassets due to credit losses These Plans primarily invest in debt instruments such as Government securitiesand highly rated corporate bonds ndash the valuation of which is inversely proportional to the interest rate movementsInterest Rate Risk The present value of Defined Benefit Plans liability is determined using the discount ratebased on the market yields prevailing at the end of reporting period on Government bonds A decrease inyields will increase the fund liabilities and vice-versaSalary Cost Inflation Risk The present value of the Defined Benefit Plan liability is calculated with referenceto the future salaries of participants under the Plan Increase in salary due to adverse inflationary pressuresmight lead to higher liabilitiesThese Plans have a relatively balanced mix of investments in order to manage the above risks The investmentstrategy is designed based on the interest rate scenario liquidity needs of the Plans and pattern of investmentas prescribed under various statutes
(Amount in `) Particulars Gratuity 2018-19 2017-18
I Components of Defined Benefit Cost 31-03-2019 31-03-2018 Recognised in Profit or Loss a Current Service Cost 641829 519816 b Past Service Cost ndash
c Net Interest Cost (184109) (72060) Remeasurements a Effect of changes in demographic assumptions (2108) ndash b Effect of changes in financial assumptions ndash (546692) c Effect of experience adjustments (142950) (700483) d (Return) on plan assets (excluding interest income) 24103 110903 e Changes in asset ceiling (excluding interest income) ndash ndash f Total remeasurements included in OCI (169160) (1358078)
Total defined benefit cost recognized in PampL 288560 (910323)I I Net Assets (Liabilities) recognised in Balance Sheet 31-03-2019 31-03-2018
1 Defined Benefit Obligation at end of period 11112243 102978642 Fair value of plan assets at end of period 13058222 120087733 Net defined benefit liability (asset) (1945979) (1710909)
III Change in Defined Benefit Obligation 31-03-2019 31-03-20181 Defined benefit obligation at beginning of period 10297864 111006822 Current service cost 641829 5198163 Interest expenses 755904 7223694 Remeasurements gains (losses)
a Effect of changes in demographic assumptions (2108) ndashb Effect of changes in financial assumptions ndash (546692)c Effect of experience adjustments (142950) (700483)
5 Benefits Paid (438296) (797828)6 Present Value of DBO at end of the year 11112243 10297864
IV Change in Fair Value of Plan Assets 31-03-2019 31-03-20181 Fair value of plan assets at beginning of period 12008773 11529880
55
NOTES TO THE FINANCIAL STATEMENTS
2 Interest income 940012 7944303 Actual Company Contributions 523630 3713884 Benefits Paid (438296) (797828)5 Remeasurements Gains(Losses) on plan assets 24103 1109036 Fair Value of Plan Assets at end of period 13058222 12008773
V Significant Actuarial Assumptions 31-03-2019 31-03-20181 Discount rate () 750 7502 Salary increase rate 70 703 Attrition Rate 20 204 Retirement Age 58 585 Pre-retirement Mortality Indian Assured Indian Assured
Lives Mortality Lives Mortality(2012-14) Ultimate (2006-08) Ultimate
6 Disability Nil NilVI Sensitivity Analysis
The below sensitivity analysis are based on a change in an assumption while holding all other assumptionsconstant In practice this is unlikely to occur and changes in some of the assumptions may be correlatedWhen calculating the sensitivity of the defined benefit obligation to significant actuarial assumptionsthe same method (present value of the defined benefit obligation calculated with the projected unit creditmethod at the end of the reporting period) has been applied as when calculating the defined benefitliability recognised in the balance sheet The methods and types of assumptions used in preparing thesensitivity analysis did not change compared to the prior period
DBO as at DBO as at31-03-2019 31-03-2018
1 Discount rate +100 basis points 10484869 96707062 Discount rate -100 basis points 11804923 109908143 Salary Increase Rate +1 11746789 109364544 Salary Increase Rate -1 10525722 97077345 Attrition Rate +1 11127835 103179616 Attrition Rate -1 11095064 10276102
Maturity Analysis of the Benefit Payments 31-03-2019 31-03-2018 Year 1 804294 399061 Year 2 1117591 769443 Year 3 558914 1211853 Year 4 2204073 512504 Year 5 1303903 2056016 Next 5 years 4323660 4603103
E Amount towards Defined Contribution Plans have been recognized under Contribution to Provident and OtherFunds in Note 16 ` 4564892- (2018 - ` 3983444-)
F The financial statements were approved for issue by the Board of Directors on 15th April 2019G Company has adopted IND As 115 lsquoRevenue from Contracts with Customersrsquo wef 01st April 2018 on prospective
basis and there is no material impact on Financial StatementsH Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Second
Amendment Rules 2019 on 30th March 2019 notifying new Standard Ind AS 116 lsquoLeasesrsquo and otherconsequential amendment in existing Ind As This Ind AS is applicable for annual period beginning on or after01st April 2019 The company is in the process of analysing the impact of such amendment which are notexpected to be material
56
NOTES TO THE FINANCIAL STATEMENTS
21 Financial Instruments and Related DisclosuresI Capital Management
The Company does not have borrowing and aims at maintaining a strong capital base so as to maintain adequatesupply of funds towards future growth plans as a going concern
II Categories of Financial InstrumentsAmount in `
Particulars Note As at As at March 31 2019 March 31 2018
Carrying Fair Carrying FairValue Value Value Value
A Financial Assetsa) Measured at Amortised Cost
i) Cash and cash equivalents 6 763039 763039 900355 900355ii) Other bank balances 7 5489856 5489856 53182631 53182631iii) Trade Receivables 5 16310661 16310661 14154244 14154244iv) Other Financial Assets 8 4724316 4724316 6349124 6349124
Sub - total 27287872 27287872 74586354 74586354 b) Measured at Fair Value through Profit or Loss
i) Investment in mutual funds 4 280294894 280294894 208482957 208482957Sub - total 280294894 280294894 208482957 208482957
Total Financial Assets 307582766 307582766 283069311 283069311B Financial Liabilities
Measured at Amortised Costi) Trade Payables 483074 483074 395920 395920ii) Other Financial Liabilities 12 9272344 9272344 11118126 11118126Total Financial Liabilities 9755418 9755418 11514046 11514046
The carrying amounts of trade payables other financial liabilities cash and cash equivalents other bank balancestrade receivables and other financial assets are considered to be the same as their fair values due to their short termnatureFair value in Mutual fund has been considered as Level 1 as Hierarchy for the same are based on unadjusted pricesin active marketIII Financial Risk Management Objectives
The Company has a system-based approach to risk management anchored to policies and procedures andinternal financial controls aimed at ensuring early identification evaluation and management of key financialrisks (such as market risk credit risk and liquidity risk) that may arise as a consequence of its businessoperations as well as its investing activities Accordingly the Companyrsquos risk management framework has theobjective of ensuring that such risks are managed within acceptable and approved risk parameters in a disciplinedand consistent manner and in compliance with applicable regulation It also seeks to drive accountability in thisregardLiquidity RiskThe company has current assets aggregate to ` 308020330- (2018- ` 283475635) including CurrentInvestments Cash and cash equivalents and Other bank balances of ` 286547789- (2018- ` 262565943-)against an aggregate Current liability of ` 11093758- (2018- ` 12730077-) on the reporting dateFurther whilethe Companyrsquos total equity stands at ` 306150187- (2018- ` 281343744-) and it has no borrowings In suchcircumstances liquidity risk or the risk that the company may not be able to settle or meet its obligations as theybecome due does not existMarket RiskThe company invests in mutual fund schemes of leading fund houses Such investments are susceptible tomarket price risk that arise mainly from changes in interest rate which may impact the return and value of such
57
NOTES TO THE FINANCIAL STATEMENTS
investments However given the relatively short tenure of the underlying portfolio of the mutual fund schemes inwhich the company has invested such price risk is not significantCredit RiskCompanyrsquos deployment in financial instruments such as mutual funds and fixed deposit are made in high qualitypaperscounterparties The company has receivable balances with ITC Limited under the Operating ServiceAgreement which are generally short term in nature Accordingly the Company has concluded that no provisionfor expected credit loss is required
22 Related Party DisclosuresRelated Party Transactionsi) Name of related parties and nature of relationships
ITC Limited of which the Company is an Associateii) Key Management Personnel
Board of DirectorsN Anand Chairman amp Non-Executive DirectorJ Singh Non-Executive DirectorR C Mehta Non-Executive DirectorC K Koshy Non-Executive DirectorM Narayanan Non-Executive DirectorD R Choudhury Non-Executive Director
iii) Summary of transactions during the year Amount in `
Particulars ITC Limited Key ManagementPersonnel
2019 2018 2019 2018License Fees Received 43644599 38834172 ndash ndashPurchase of Services 364514 513635 ndash ndashRemuneration of Managers on Deputation Reimbursed 5916468 5236397 ndash ndashRecoveries of Contractual Remuneration(Including Mangers on Deputation) 53058539 51502148 ndash ndashExpenses Recovered 2168155 2400471 ndash ndashExpenses Reimbursed ndash 44604 ndash ndashDividend Payments 6068675 6068675 700 700Remuneration to Key Management Personnel- Directorrsquos Sitting Fees 370000 350000Balance amount recoverable 20865894 18292750 ndash ndashBalance amount payable ndash ndash ndash ndash
58
TO THE MEMBERS OFGUJARAT HOTELS LIMITED
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying financial statementsof Gujarat Hotels Limited (ldquothe Companyrdquo) which comprisethe Balance Sheet as at 31st March 2019 the Statement ofProfit and Loss including other comprehensive incomeStatement of Changes in Equity and Statement of CashFlows for the year then ended and notes to the financialstatements including a summary of significant accountingpolicies and other explanatory information (hereinafterreferred to as ldquothe financial statementsrdquo)
In our opinion and to the best of our information andaccording to the explanations given to us the aforesaidfinancial statements give the information required by theCompanies Act 2013 (ldquothe Actrdquo) in the manner so requiredand give a true and fair view in conformity with the IndianAccounting Standards specified under section 133 of theAct read with the Companies (Indian Accounting Standards)Rules 2015 as amended (lsquoInd ASrdquo) and other accountingprinciples generally accepted in India of the state of affairsof the Company as at 31 st March 2019 and totalcomprehensive income (comprising of profit and othercomprehensive income) changes in equity and its cashflows for the year ended on that date
Basis for Opinion
We conducted our audit of the financial statements inaccordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act Our responsibilities underthose Standards are further described in the AuditorrsquosResponsibilities for the Audit of the Financial Statementssection of our report We are independent of the Companyin accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financialstatements under the provisions of the Act and the Rulesmade thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements andthe Code of Ethics We believe that the audit evidence wehave obtained is sufficient and appropriate to provide abasis for our audit opinion
Key Audit Matters
Key audit matters are those matters that in our professionaljudgment were of most significance in our audit of thesefinancial statements of the current period These matterswere addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereonand we do not provide a separate opinion on these mattersWe have determined the matters described below to bethe key audit matters to be communicated in our report
INDEPENDENT AUDITORS REPORT
Information Other than the Financial Statements andAuditorrsquos Report Thereon
The Companyrsquos Board of Directors is responsible forpreparation of the other information The other informationcomprises the information included in the Boardrsquos Reportincluding Annexures to Boardrsquos Report ManagementDiscussion and Analysis Report on Corporate Governance
and Shareholderrsquos Information but does not include thefinancial statements and our auditorrsquos report thereon
Our opinion on the financial statements does not cover theother information and we do not express any form ofassurance conclusion thereon
In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing
Sr No
Key Audit Matter How our audit addressed the matter
1 Evaluation of uncertain legal position of leasehold land
(Refer note no 20A to the financial statements)
The lease period of land held by the Company has expired The Company has filed necessary writ petition with High Court of Gujarat in April 2013 which is still pending for adjudication The Company has also made necessary application to State Government for Conversion of land from Leasehold to Freehold or Extension of Lease which is in process This matter being sub-judice essentially involves significant judgement to determine the possible outcome and therefore we have considered it as a key audit matter
We performed the following substantive procedures
Obtained details of application made to State Government Obtained details of writ petition filed to the High Court of
Gujarat and order copy passed by the High Court of Gujarat restraining the State Government from disturbing the actual possession over the property
Obtained details of progress in the matter Discussed the case with the Companyrsquos legal advisor about
the possible outcomes Read the minutes of the board meetings
Based on the procedures described managementrsquos evaluation on the same is acceptable
59
so consider whether the other information is materiallyinconsistent with the financial statements or our knowledgeobtained in the audit or otherwise appears to be materiallymisstated
If based on the work we have performed we conclude thatthere is a material misstatement of this other informationwe are required to report that fact We have nothing to reportin this regard
Responsibilities of Management and Those Charged withGovernance for the Financial Statements
The Companyrsquos Board of Directors is responsible for thematters stated in section 134(5) of the Act with respect tothe preparation of these financial statements that give atrue and fair view of the financial position financialperformance including other comprehensive incomechanges in equity and cash flows of the Company inaccordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards(Ind AS) prescribed under section 133 of the Act
This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company andfor preventing and detecting frauds and other irregularitiesselection and application of appropriate accounting policies making judgments and estimates that are reasonableand prudent and design implementation andmaintenance of adequate internal financial controls thatwere operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to thepreparation and presentation of the financial statementsthat give a true and fair view and are free from materialmisstatement whether due to fraud or error
In preparing the financial statements management isresponsible for assessing the Companyrsquos ability tocontinue as a going concern disclosing as applicablematters related to going concern and using the goingconcern basis of accounting unless management eitherintends to liquidate the Company or to cease operationsor has no realistic alternative but to do so
The Board of Directors is also responsible for overseeingthe Companyrsquos financial reporting process
Auditorrsquos Responsibilities for the Audit of the FinancialStatements
Our objectives are to obtain reasonable assurance aboutwhether the financial statements as a whole are free frommaterial misstatement whether due to fraud or error andto issue an auditorrsquos report that includes our opinionReasonable assurance is a high level of assurance but isnot a guarantee that an audit conducted in accordance withSAs will always detect a material misstatement when itexists Misstatements can arise from fraud or error and areconsidered material if individually or in the aggregate they
could reasonably be expected to influence the economicdecisions of users taken on the basis of these financialstatements
As part of an audit in accordance with SAs we exerciseprofessional judgment and maintain professionalskepticism throughout the audit We also
bull Identify and assess the risks of materialmisstatement of the financial statements whetherdue to fraud or error design and perform auditprocedures responsive to those risks and obtain auditevidence that is sufficient and appropriate to providea basis for our opinion The risk of not detecting amaterial misstatement resulting from fraud is higherthan for one resulting from error as fraud may involvecollusion forgery intentional omissionsmisrepresentations or the override of internal control
bull Obtain an understanding of internal control relevantto the audit in order to design audit procedures thatare appropriate in the circumstances Under section143(3)(i) of the Act we are also responsible forexpressing our opinion on whether the Company hasadequate internal financial controls system in placeand the operating effectiveness of such controls
bull Evaluate the appropriateness of accounting policiesused and the reasonableness of accountingestimates and related disclosures made bymanagement
bull Conclude on the appropriateness of managementrsquosuse of the going concern basis of accounting andbased on the audit evidence obtained whether amaterial uncertainty exists related to events orconditions that may cast significant doubt on theCompanyrsquos ability to continue as a going concern Ifwe conclude that a material uncertainty exists we arerequired to draw attention in our auditorrsquos report tothe related disclosures in the financial statementsor if such disclosures are inadequate to modify ouropinion Our conclusions are based on the auditevidence obtained up to the date of our auditorrsquosreport However future events or conditions maycause the Company to cease to continue as a goingconcern
bull Evaluate the overall presentation structure andcontent of the financial statements including thedisclosures and whether the financial statementsrepresent the underlying transactions and events ina manner that achieves fair presentation
We communicate with those charged with governanceregarding among other matters the planned scope andtiming of the audit and significant audit findings includingany significant deficiencies in internal control that weidentify during our audit
INDEPENDENT AUDITORS REPORT
60
We also provide those charged with governance with astatement that we have complied with relevant ethicalrequirements regarding independence and tocommunicate with them all relationships and other mattersthat may reasonably be thought to bear on ourindependence and where applicable related safeguards
From the matters communicated with those charged withgovernance we determine those matters that were of mostsignificance in the audit of the financial statements of thecurrent year and are therefore the key audit matters Wedescribe these matters in our auditorrsquos report unless lawor regulation precludes public disclosure about the mattersor when in extremely rare circumstances we determinethat a matters should not be communicated in our reportbecause the adverse consequences of doing so wouldreasonably be expected to outweigh the public interestbenefits of such communication
Report on Other Legal and Regulatory Requirements
1 As required by the Companies (Auditorrsquos Report)Order 2016 (ldquothe Orderrdquo) issued by the CentralGovernment of India in terms of sub-section (11) ofsection 143 of the Act we give in ldquoAnnexure Ardquo astatement on the matters specified in paragraphs 3and 4 of the Order to the extent applicable
2 As required by Section 143(3) of the Act we reportthat
a we have sought and obtained all the information andexplanations which to the best of our knowledge andbelief were necessary for the purposes of our audit
b in our opinion proper books of account as requiredby law have been kept by the Company so far as itappears from our examination of those books
c the Balance Sheet the Statement of Profit and lossincluding other comprehensive income the Statementof Changes in Equity and the Statement of Cash Flowsdealt with by this Report are in agreement with thebooks of account
d in our opinion the aforesaid financial statementscomply with the Indian Accounting Standards (Ind AS)prescribed under Section 133 of the Act
e on the basis of the written representations receivedfrom the directors as on 31st March 2019 taken onrecord by the Board of Directors none of the directorsis disqualified as on 31st March 2019 from beingappointed as a director in terms of Section 164(2) ofthe Act
f with respect to the adequacy of the internal financialcontrols with reference to financial statements of theCompany and the operating effectiveness of suchcontrols refer to our separate report in ldquoAnnexure Brdquoand
g with respect to the other matters to be included in theAuditorrsquos Report in accordance with the requirementsof section 197(16) of the Act as amended theCompany has neither paid nor provided for anyremuneration to its directors during the year
h with respect to the other matters to be included in theAuditorrsquos Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules 2014 in ouropinion and to the best of our information andaccording to the explanations given to us
i the Company does not have any pendinglitigations which would impact its financialposition
ii the Company did not have any long-termcontracts including derivative contracts for whichthere were any material foreseeable losses
iii there has been no delay in transferringamounts required to be transferred to theInvestor Education and Protection Fund by theCompany
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
61
ANNEXURE A TO THE INDEPENDENT AUDITORrsquoS REPORT
The annexure referred to in our Independent AuditorrsquosReport to the members of Gujarat Hotels Limited (ldquotheCompanyrdquo) on the financial statements for the year ended31st March 2019 we report that
i (a) The Company has maintained proper recordsshowing full particulars including quantitativedetails and situation of fixed assets
(b) As explained to us the Company has a regularprogram of physical verification of fixed assetswhich in our opinion is reasonable The assetswhich were to be covered as per the saidprogram have been physically verified by themanagement during the year In our opinion andAccording to the information and explanationsgiven to us no material discrepancies werenoticed on such verification
(c) According to the information and explanationsgiven to us and on the basis of our examinationof the records of the Company the title deeds ofimmovable properties are held in the name ofthe Company with respect to land the Companyhas filed a writ petition with Gujarat High Courtseeking that the Gujarat State Government bedirected to take action on Companyrsquosapplication to have the leasehold land of theHotel Converted to freehold and transferred toCompany as per the existing government policyin this regard
ii The Company does not have any inventory andtherefore reporting under clause (ii) of the Order isnot applicable to the Company
iii The Company has not granted any loans secured orunsecured to Companies firms Limited LiabilityPartnerships or other parties covered in the registermaintained under section 189 of the Companies Act2013 and therefore reporting under clause (iii) of theOrder is not applicable to the Company
iv The Company has not given any loans guaranteesor security In respect of the Investments made in ouropinion and according to the information andexplanations given to us the Company has compliedwith the provisions of section 186 of the Act
v According to the information and explanations givento us the Company has not accepted any depositsduring the year from the public within the meaning ofprovisions of section 73 to 76 of the Companies Act2013 and the rules framed thereunder and thereforereporting under clause (v) of the Order is notapplicable to the Company
vi In our opinion and according to the information andexplanations given to us in view of Rule 3 of theCompanies (Cost Records and Audit) AmendmentsRules 2014 the maintenance of cost records undersub-section (1) of section 148 of the Companies Act2013 is not applicable to the Company and thereforereporting under clause (vi) of the Order is notapplicable to the Company
vii (a) According to the information and explanationsgiven to us the Company has been regular indepositing with appropriate authoritiesundisputed statutory dues including providentfund employeersquos state insurance income-taxvalue added tax goods and service tax cessand other statutory dues applicable to it Furtherno undisputed amounts payable in respect ofprovident fund employeersquos state insuranceincome tax value added tax goods and servicetax cess and any other statutory dues were inarrears as at 31st March 2019 for a period ofmore than six months from the date theybecome payable
(b) According to the information and explanationsgiven to us there are no dues of Income taxsales tax value added tax and goods andservice tax which have not been deposited onaccount of any dispute
viii The Company has not taken any loans or borrowingsfrom financial institutions banks and government orhas not issued any debentures and thereforereporting under clause (viii) of the Order is notapplicable to the Company
ix The Company has not raised moneys by way of initialpublic offer or further public offer (including debtinstrument) and term loans during the year andtherefore reporting under clause (ix) of the Order isnot applicable to the Company
x To the best of our knowledge and according toinformation and explanations given to us no materialfraud by the Company or on the Company by its officersor employees has been noticed or reported duringthe course of our audit
xi In our opinion and according to the information andexplanations given to us the Company has not paidor provided any managerial remuneration during theyear and therefore reporting under clause (xi) of theOrder is not applicable to the Company
xii The Company is not a Nidhi company and thereforereporting under clause (xii) of the Order is notapplicable to the Company
INDEPENDENT AUDITORS REPORT
62
xiii In our opinion and according to the information andexplanations given to us and based on ourexamination of the records of the Company alltransactions with the related parties are in compliancewith Section 177 and 188 of the Act where applicableand the details have been disclosed in the financialstatements as required by the applicable accountingstandards
xiv According to the information and explanations givento us the Company has not made any preferentialallotment or private placement of shares or fully orpartly convertible debentures during the year underreview and therefore reporting under clause (xiv) ofthe Order is not applicable to the Company
xv In our opinion and according to the information andexplanations given to us the Company has not
entered into any non-cash transactions with directorsor persons connected with directors and thereforereporting under clause (xv) of the Order is notapplicable to the Company
xvi The Company is not required to be registered undersection 45-IA of the Reserve Bank of India Act 1934
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
63
ANNEXURE ldquoBrdquo TO THE INDEPENDENT AUDITORSrsquo REPORT
(Referred to in paragraph 2(f) under lsquoReport on Other Legaland Regulatory Requirementsrsquo section of our report to theMembers of Gujarat Hotels Limited on the financialstatements of even date)
Report on the Internal Financial Controls with referenceto financial statements under Clause (i) of Sub-section 3of Section 143 of the Act
W e have audited the internal financial controls withreference to financial statements of Gujarat Hotels Limited(ldquothe Companyrdquo) as of 31st March 2019 in conjunction withour audit of the financial statements of the Company for theyear ended on that date
Managementrsquos Responsibility for Internal FinancialControls
The Companyrsquos management is responsible forestablishing and maintaining internal financial controlsbased on the internal control over financial reporting criteriaestablished by the Company considering the essentialcomponents of internal control stated in the Guidance Noteon Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountantsof India (ldquoICAIrdquo) These responsibilities include the designimplementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuringthe orderly and efficient conduct of its business includingadherence to companyrsquos policies the safeguarding of itsassets the prevention and detection of frauds and errorsthe accuracy and completeness of the accounting recordsand the timely preparation of reliable financial informationas required under the Act
Auditorsrsquo Responsibility
Our responsibility is to express an opinion on theCompanyrsquos internal financial controls with reference tofinancial statements based on our audit We conductedour audit in accordance with the Guidance Note on Audit ofInternal Financial Controls over Financial Reporting (theldquoGuidance noterdquo) and the Standards on Auditing issued byICAI and deemed to be prescribed under section 143(10)of the Companies Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the ICAIThose Standards and the Guidance Note require that wecomply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whetheradequate internal financial controls with reference tofinancial statements were established and maintained andif such controls operated effectively in all material respects
Our audit involves performing procedures to obtain auditevidence about the adequacy of the internal financialcontrols with reference to financial statements and their
operating effectiveness Our audit of internal financialcontrols with reference to financial statements includedobtaining an understanding of internal financial controlswith reference to financial statements assessing the riskthat a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal controlbased on the assessed risk The procedures selecteddepend on the auditorrsquos judgement including theassessment of the risks of material misstatement of thefinancial statements whether due to fraud or error
We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our auditopinion on the Companyrsquos internal financial controls withreference to financial statements
Meaning of Internal Financial Controls with reference tofinancial statements
A Companyrsquos internal financial controls with reference tofinancial statements is a process designed to providereasonable assurance regarding the reliability of financialreporting and the preparation of financial statements forexternal purposes in accordance with generally acceptedaccounting principles A Companyrsquos internal financialcontrols with reference to financial statements includesthose policies and procedures that (1) pertain to themaintenance of records that in reasonable detailaccurately and fairly reflect the transactions anddispositions of the assets of the Company (2) providereasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements inaccordance with generally accepted accounting principlesand that receipts and expenditures of the Company arebeing made only in accordance with authorisations ofmanagement and directors of the Company and (3) providereasonable assurance regarding prevention or timelydetection of unauthorised acquisition use or dispositionof the Companyrsquos assets that could have a material effecton the financial statements
Inherent Limitations of Internal Financial Controls withreference to financial statements
Because of the inherent limitations of internal financialcontrols with reference to financial statements includingthe possibility of collusion or improper managementoverride of controls material misstatements due to erroror fraud may occur and not be detected Also projections ofany evaluation of the internal financial controls withreference to financial statements to future periods aresubject to the risk that the internal financial control withreference to financial statements may become inadequatebecause of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate
INDEPENDENT AUDITORS REPORT
64
Opinion
In our opinion the Company has in all material respectsan adequate internal financial controls with reference tofinancial statements and such internal financial controlswith reference to financial statements were operatingeffectively as at 31st March 2019 based on the internalcontrol over financial reporting criteria established by theCompany considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal
INDEPENDENT AUDITORS REPORT
Financial Controls over Financial Reporting issued by theInstitute of Chartered Accountants of India
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
5
forgotten the password then enter user ID andthe image verification code and click on forgotpassword amp enter the details as prompted by thesystem
VII If you are a first time user please follow the stepsgiven below
For Members holding shares either in dematerialisedform or in certificate form
PAN Enter your 10 digit alpha-numeric PAN issuedby Income Tax Departmentbull Members who have not updated their
PAN with the Company DepositoryParticipant are requested to use the firsttwo letters of their name and the 8 digitsof the sequence number in the PAN field
bull In case the sequence number is lessthan 8 digits enter the applicable numberof 0rsquos before the number after the firsttwo characters of the name in CAPITALletters Eg If your name is RameshKumar with sequence number I thenenter RA00000001 in the PAN field
Dividend Enter the Dividend Bank Details or Date ofBank Birth (in ddmmyyyy format) as recorded inDetails your demat account or in the CompanyOR records in order to loginDate of bull If both the details are not recorded withBirth the Depository or the Company please
enter your member ID folio number inthe Dividend Bank details field asmentioned in instruction IV
VIII After entering these details appropriately click onlsquoSubmitrsquo
IX Members holding shares in certificate form willthen reach directly to the Companyrsquos selectionscreen
X Members holding shares in dematerialised formwill then reach the lsquoPassword Creationrsquo menuwherein they are required to mandatorily entertheir login password in the new password fieldKindly note that this password can be used forvoting on resolutions of any other company onwhich you are eligible to vote provided that thesaid company opts for e-voting through CDSLplatform It is strongly recommended not to shareyour password with any other person and takeutmost care to keep your password confidential
XI For Members holding shares in certificate formthe details can be used only for e-voting on theResolutions contained in this Notice
XII Click on the EVSN for Gujarat Hotels Limited
XIII On the voting page you will see lsquoResolutionDescriptionrsquo and against the same the optionlsquoYes Norsquo for voting Select the option lsquoYesrsquo or lsquoNorsquoas desired The option lsquoYesrsquo implies that youassent to the Resolution and the option lsquoNorsquoimplies that you dissent to the Resolution
XIV Click on the lsquoResolutions File Linkrsquo if you wish toview the entire Resolution details
XV After selecting the Resolution you have decidedto vote on click on lsquoSubmitrsquo A confirmation boxwill be displayed If you wish to confirm your voteclick on lsquoOkrsquo else to change your vote click onlsquoCancelrsquo and accordingly modify your vote
XVI Once you lsquoConfirmrsquo your vote on the Resolutionyou will not be allowed to modify your vote
XVII You can also take a print of the votes cast byclicking on lsquoClick here to printrsquo option on theVoting page
XVIII Members can also cast their vote using CDSLrsquosmobile app lsquom-Votingrsquo available on Android Appleand Windows based mobiles Members may login to m-Voting using their e-voting credentials tovote on the Company Resolutions
XIX Note for NonndashIndividual Members and Custodians
bull Non-Individuals Members (ie other than HUFIndividuals NRI etc) and Custodians are requiredto log on to wwwevotingindiacom and registerthemselves as Corporates
bull A scanned copy of the Registration Form bearingthe stamp and sign of the entity should be emailedto helpdeskevotingcdslindiacom
bull After receiving the login details user would be ableto link the account(s) for which they wish to voteon
bull The list of accounts linked in the login should bemailed to helpdeskevotingcdslindiacom and onapproval of the accounts they would be able tocast their vote
bull A scanned copy of the Board Resolution and Powerof Attorney (POA) which they have issued in favourof the Custodian if any should be uploaded in PDFformat in the system for the Scrutinizer to verify thesame
XX In case you have any queries or issues regardinge-voting you may refer to the Frequently AskedQuestions and e-voting manual available underthe help section of CDSLrsquos e-voting websitewwwevotingindiacom or write an email tohelpdeskevotingcdslindiacom or contact
6
Mr Rakesh Dalvi at telephone no 18002005533(toll free) You may also address your queries grievances relating to remote e-voting or votingat the meeting to Mr M Agarwal ComplianceOfficer at e-mail ID ghlinvestorsyahoocoin orat telephone no 0265 233 0033
XXI Those who become Members of the Companyafter despatch of the Notice but on or before31st August 2019 (cut-off date) may follow thesteps from Sl Nos II to XIX mentioned above forcasting of vote
XXII General Information
(a) There will be one vote for every Client ID NoRegistered Folio No irrespective of thenumber of joint holders
(b) The Results of voting will be declaredwithin 48 hours from the conclusion of theAGM and the Resolutions will be deemedto be passed on the date of the AGMsubject to receipt of requisite number ofvotes The declared Results along with theScrutinizerrsquos Report will be availableforthwith on the Companyrsquos websitewwwgujarathotelsltdin under the sectionlsquoInvestor Relationsrsquo and on the website ofCDSL such Results will also be forwardedto BSE Limited where the Companyrsquosshares are listed
EXPLANATORY STATEMENT
Annexed to the Notice convening the Thirty Seventh AnnualGeneral Meeting to be held on Saturday 7th September2019
Item No 5
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 28th June 2019 on the recommendationof the Nominations and Remuneration Committee(lsquothe Committeersquo) approved the appointment of Mr MohanSwarup Bhatnagar as Additional Director with effect from28th June 2019 and subject to the approval of the Membersalso as Independent Director of the Company for a periodof five years with effect from the said date in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquotheActrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquothe Listing Regulations2015rsquo)
Mr Bhatnagar (67) is a Science Graduate from St StephenrsquosCollege University of Delhi and is an MBA from the Facultyof Management Studies University of Delhi
Mr Bhatnagar joined ITC Limited (ITC) in 1975 in the HotelsDivision He held various job positions in Finance beforetaking over as the Head of Finance in 1997 withresponsibility for Treasury Audit Purchasing MaterialManagement and Information Technology Subsequentlyhe held charge of Growth and Development for the HotelsBusiness as Executive Vice President He was a memberof the Management Committee of the Division and was onthe Boards of Joint Venture and Subsidiary companies ofITC He retired from ITC in September 2013 Currently heis actively involved in angel investing and in mentoringselect start-up ventures
The Committee and the Board are of the view that theassociation of Mr Bhatnagar and the rich experience hebrings with him would benefit the Company Declarationhas been received from Mr Bhatnagar that he meets thecriteria of Independence prescribed under Section 149 ofthe Act read with the Companies (Appointment andQualification of Directors) Rules 2014 and Regulation 16of the Listing Regulations 2015 In the opinion of your BoardMr Bhatnagar fulfils the conditions specified in the Act theRules thereunder and the Listing Regulations 2015 forappointment as an Independent Director and he isindependent of the management of the CompanyMr Bhatnagar will be entitled to sitting fees for attending themeetings of the Board and its Committees
Requisite Notice under Section 160 of the Act proposingthe appointment of Mr Bhatnagar has been received by theCompany and consent has been filled by Mr Bhatnagarpursuant to Section 152 of the Act
Mr Bhatnagar holds 2500 shares in the Company
Mr Bhatnagar and his relatives are interested in thisResolution None of the other Directors and Key ManagerialPersonnel of the Company or their relatives is interestedin this Resolution
The Board recommends this Resolution for your approval
Item Nos 6 amp 7
The Members of the Company at the Thirty Second AnnualGeneral Meeting held on 29th September 2014 approvedthe appointment of Mr Koshy and Mr M Narayanan asIndependent Directors of the Company for a period of fiveyears with effect from the said date Mr Koshy andMr Narayanan will complete their respective terms on28th September 2019
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 15th April 2019 on the recommendationof the Nominations and Remuneration Committee (lsquotheCommitteersquo) recommended for the approval of theMembers the re-appointment of Mr Koshy andMr Narayanan as Independent Directors of the Companywith effect from 29th September 2019 in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquothe
7
Actrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquoListing Regulations2015rsquo) as set out in the Resolutions relating to theirrespective re-appointment
The Committee and the Board are of the view that giventhe knowledge experience and performance of Mr Koshyand Mr Narayanan and contribution to the Board processesby them their continued association would benefit theCompany Declarations have been received from Mr Koshyand Mr Narayanan that they meet the criteria ofIndependence prescribed under Section 149 of the Act readwith the Companies (Appointment and Qualification ofDirectors) Rules 2014 and Regulation 16 of the ListingRegulations 2015 In the opinion of the Board Mr Koshyand Mr Narayanan fulfil the conditions specified in the Actthe Rules thereunder and the Listing Regulations 2015 forre-appointment as Independent Directors and they areindependent of the management of the Company Mr Koshyand Mr Narayanan will be entitled to sitting fees for attendingmeetings of the Board and its Committees
Consent of the Members by way of Special Resolution isrequired for re-appointment of Mr Koshy and Mr Narayananin terms of Section 149 of the Act Further pursuant toRegulation 17 of the Listing Regulations 2015 consent ofthe Members by way of Special Resolution is also requiredfor continuation of a Non-Executive Director beyond the ageof seventy five years During the proposed term ofre-appointment Mr Koshy and Mr Narayanan will attain theage of seventy five years on 12th February 2020 and1st July 2020 respectively The Special Resolutions under
Item No 6 and 7 once passed shall also be deemed asyour approval under the Listing Regulations 2015 forcontinuation of Mr Koshy and Mr Narayanan as IndependentDirectors beyond the age of seventy five years
Requisite Notices under Section 160 of the Act proposingthe re-appointment of Mr Koshy and Mr Narayanan havebeen received by the Company and consents have beenfiled by Mr Koshy and Mr Narayanan pursuant to Section152 of the Act
Additional information in respect of Mr Koshy andMr Narayanan pursuant to the Listing Regulations 2015and the Secretarial Standard on General Meetings isappearing in the Report and Accounts under the sectionslsquoYour Directorsrsquo and lsquoReport on Corporate GovernancersquoMr Koshy and Mr Narayanan do not hold any share in theCompany either in their individual capacity or on a beneficialbasis for any other person
Mr Koshy and Mr Narayanan and their relatives areinterested in the Special Resolutions relating to theirrespective re-appointment None of the other Directors andKey Managerial Personnel of the Company or theirrelatives is interested in these Special Resolutions
The Board recommends these Special Resolutions for yourapproval
By Order of the BoardGujarat Hotels Limited
Place New Delhi Jagdish SinghDate 15th July 2019 Director
8
ROUTE MAP
AGM VenueWelcomHotel VadodaraR C Dutt Road AlkapuriVadodara 390 007
9
N Anand
Nakul Anand (62) DIN 00022279 a Non-Executive Directorof the Company since 10th March 1998 was appointed asthe Chairman of the Company effective 21st March 2009He is an Executive Director on the Board of ITC Limited andholds responsibility for the Hospitality Travel amp Tourismand Lifestyle Retailing businesses of ITC
An Economics Honours Graduate from the Delhi Universitywith an AMP degree from the Bond University AustraliaAnand joined ITC Hotelsrsquo Management TrainingProgramme in 1978 He has also served as the ManagingDirector of erstwhile ITC Hotels Limited during the period2003-05
In a career that spans close to four decades Anand hasbeen acknowledged in the hotels and tourism industry forhis vision and commitment Leveraging the significantlearning of sustainable excellence within ITC he led theteam at ITC Hotels to pioneer the concept of lsquoResponsibleLuxuryrsquo in the hospitality industry securing LEEDreg Platinumcertifications for all ITC premium luxury hotels He hasformulated value-based strategies to create a uniquequality control model His dynamic leadership and passionfor the business is recognised and acknowledged by hispeers He has been a past President of the HotelAssociation of India and past Chairman of the CII NationalTourism Committee Anand is presently a member of theNational Tourism Advisory Council constituted by theMinistry of Tourism Government of India Chairman of theFederation of Associations in Indian Tourism amp Hospitalityand a Member of the Executive Committee of the HotelAssociation of India He is also a Member of the IndiandashSriLanka CEOs Forum Council Member amp ExecutiveCommittee Member of the National Culture Fund Ministryof Culture Government of India and a Member on the Boardof the International Tourism Partnership
Other Directorships
Name of the company Position
International Travel House Limited Chairman amp Non-Executive Director
Landbase India Limited Chairman amp Non-Executive Director
Fortune Park Hotels Limited Chairman amp Non-Executive Director
WelcomHotels Lanka (Private) Limited Chairman amp Non-Executive Director
Srinivasa Resorts Limited Vice Chairman amp Non-Executive Director
ITC Limited Executive Director
Bay Islands Hotels Limited Non-Executive Director
Maharaja Heritage Resorts Limited Non-Executive Director
Committee Membership of other companies
Name of the Committee Positioncompany
International Travel House Limited Nominations amp MemberRemuneration Committee
Landbase India Limited Audit Committee Member
Fortune Park Hotels Limited Corporate Social ChairmanResponsibility Committee
CK Koshy
Cheruvettolil Kochukoshy Koshy (74) DIN01478704 wasappointed as an Independent Non-Executive Director ofthe Company on 1st May 2007 He is Master of Arts inPolitical Science and Public Administration He joined theIndian Administrative Service in 1968 from the Gujarat Cadreand superannuated in February 2005
In a long career spanning over 38 years he has held severaleminent positions including those of Additional ChiefSecretary - Department of Revenue Industries and MinesTourism and Civil Aviation and Finance and PrincipalSecretary to the Chief Minister He served the Governmentof India as Joint Secretary amp Financial Advisor to theDepartment of Atomic Energy and as Executive Director ofNuclear Power Corporation of India Limited He has heldthe posts of Managing Director of the Tourism Corporationof Gujarat Sardar Sarovar Narmada Nigam Gujarat StateSmall Industries Corporation and Girinar Scooter LimitedHe was also the Joint Managing Director of the GujaratIndustrial Investment Corporation and Chairman of GujaratState Petroleum Corporation Limited Gujarat State PetronetLimited and Gujarat Energy Research and ManagementInstitute
Post retirement he has been a consultant to the Departmentfor International Development - UK the World Bank and tothe Department of Personnel and Administrative ReformsGovt of India He was appointed Professor Emeritus in thefaculty of Planning and Public Policy at CEPT UniversityAhmedabad and is an Advisor to both Indian School ofPetroleum and Energy New Delhi and University ofPetroleum and Energy Studies Dehradun Currently he isAdvisor at CEPT University and on the Board of Trustees ofAlliance Francaise Gujarat and GIAN an NGO whichencourages innovation at the grass root level
Koshy does not hold directorship of any other company
M Narayanan
Mahalinga Narayanan (74) DIN 00159288 was appointedas an Independent Non-Executive Director of the Companyon 10th January 2008 He is a post graduate in CommerceGraduate in Law Diploma Holder in Business Managementand holds certified Associated Membership of the Indian
YOUR DIRECTORS
10
Institute of Bankers He has rich experience of over fourdecades in Banking Project Finance Administration andrelated areas
Narayanan started his career with the Reserve Bank ofIndia in 1964 and moved over to the Bank of Baroda in1969 and continued till March 1985 During his tenure inBank of Baroda he worked in all departments of commercialbanking operation and was in-charge of large branches ofthe Bank In April 1985 he joined Industrial FinanceCorporation of India and held senior managementpositions In October 1997 he joined Tourism FinanceCorporation of India Limited as Managing Director and roseto the position of Chairman and Managing Director whichposition he held till his retirement in September 2006 Hewas conferred with ldquoUdyog Rattan Awardrdquo in the year 2005by the Institute of Economic Studies New Delhi
Other Directorships
Name of the company Position
Cox amp Kings Limited Independent DirectorTulip Star Hotels Limited Independent DirectorRoyale Indian Rail Tours Limited Independent DirectorPride Hotels Limited Chairman amp Independent Director
Committee Membership of other Companies
Name of the company Committee Position
Cox amp Kings Limited Audit Committee ChairmanRemuneration MemberCommittee
Pride Hotels Limited Audit Committee ChairmanRoyale Indian Rail Tours Limited Audit Committee Chairman
Tulip Star Hotels Limited Audit Committee Chairman
J Singh
Jagdish Singh (53) DIN 00042258 was appointed as aNon-Executive Director on the Board of the Company on16th April 2016 A Commerce Graduate and a CharteredAccountant Singh joined ITC Limited in the year 1990During these 26 years he has held various positions inthe finance function He started his career in Treasury andmoved as Corporate Accountant Commercial Manager atCigarette factory at Munger and Head of Finance at ITCEssentra Limited He was then the Head of Treasury
between 2005 and 2015 and is presently the Head ofFinance at ITCrsquos Hotels Division
Other DirectorshipsName of the company Position
International Travel House Limited Non-Executive DirectorFortune Park Hotels Limited Non-Executive DirectorBay Islands Hotels Limited Non-Executive DirectorSrinivasa Resorts Limited Non-Executive DirectorMaharaja Heritage Resorts Limited Non-Executive DirectorMimec (India) Limited Non-Executive DirectorLandbase India Limited Additional Non-Executive DirectorLogix Developers Private Limited Non-Executive Director
Committee Membership of other companiesName of the Committee Positioncompany
International Travel House Limited Stakeholders Relationship MemberCommitteeAudit Committee MemberNominations amp Remuneration MemberCommittee
Fortune Park Hotels Limited Corporate Social MemberResponsibility Committee
Srinivasa Resorts Limited Audit Committee ChairmanCorporate Social MemberResponsibility Committee
D R Choudhury
Devkanya Roy Choudhury (41) DIN 07066556 wasappointed as a Non-Executive Director of the Company on19th January 2015 A Graduate from the National LawSchool of India University Bengaluru she joined ITC Limitedin 2001 As part of Corporate Legal of ITC she has rich andvaried experience in handling legal matters pertaining tovarious divisions including Tobacco Hotels Personal CareLifestyle Retailing Education amp Stationery Paperboards ampSpecialty Papers ITC Infotech as also dealing with mergersamp acquisitions and key litigation across ITC CurrentlyMs Choudhury is the Senior Associate General Counsel ofITC Limited
Other Directorships
Name of the Company Position
WelcomHotels Lanka (Private) Limited Non-Executive Director
YOUR DIRECTORS
Denotes foreign company Denotes listed Indian company whose equity shares or preference shares or debt securities are listed on a recognised
stock exchangeNotes1 Other Directorships and Committee Memberships of Directors are as on 15th April 20192 Committee Memberships cover Committees under the Companies Act 2013 viz Audit Committee Stakeholders
Relationship Committee Nomination and Remuneration Committee and CSR Committee of Indian Companies
11
REPORT ON CORPORATE GOVERNANCE
The Directors present the Companyrsquos Report on CorporateGovernance pursuant to the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements)Regulations 2015 (lsquoListing Regulations 2015rsquo)
THE COMPANYrsquoS GOVERNANCE PHILOSOPHY
The Company firmly believes in good CorporateGovernance and has made it a practice and a continuousprocess of development right across the Company TheCompanyrsquos philosophy on Corporate Governanceenvisages attainment of high level of transparency andaccountability in the functioning of the Company andconduct of business and places due emphasis onregulatory compliance It has empowered the ExecutiveManagement to take decisions with regard to day-to-dayoperations and has also created checks and balances thatsuch decisions are taken with care and responsibility tomeet stakeholdersrsquo aspirations and societal expectations
The Companyrsquos corporate philosophy is focused on itspeople who are its most important asset and it values itsemployeesrsquo integrity creativity ability judgement andopinions who in turn demonstrate the highest ethicalstandards and responsibility towards the shareholdersThis has helped the Company take rapid strides in itspursuit of excellence
The Company is committed to enhance shareholder valuein a fair and transparent manner and has been in theforefront for benchmarking itself with the best businesspractices globally
BOARD OF DIRECTORS
All statutory and other significant and material informationare placed before the Board of Directors (the Board) toenable it to discharge its responsibility of strategicsupervision of the Company as trustees of theshareholders
Composition
The Board comprises entirely of Non-Executive Directorsincluding one Woman Director and two IndependentDirectors The strength of the Board as on 15th April 2019is five
The Board Diversity Policy of the Company requires theBoard to have balance of skills experience and diversity ofperspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the Annexure forming part ofthis Report These skills expertise and competencies areavailable in the present mix of the Directors of the Company
Composition of the Board as on 31st March 2019
Category No of PercentageDirectors to total no
of Directors
Non-Executive Independent Directors 3 50Other Non-Executive Directors 3 50Total 6 100
During the year there was no change in the directorshipMr R C Mehta resigned as Non-Executive IndependentDirector of the Company with close of work on 31st March2019 keeping in view the Regulation 17(1A) of ListingRegulations 2015
Mr Mehta has confirmed that there are no other reasons forhis resignation other than stated above
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Board were held The intervening periodbetween two Board meetings was well within the maximumgap of 120 days prescribed under the Listing Regulations2015
Board Agenda
Meetings are governed by a structured agenda The Boardmembers in consultation with the Chairman may bring upany matter for the consideration of the Board All majoragenda items are backed by comprehensive backgroundinformation to enable the Board to take informed decisionsAgenda papers are generally circulated seven days prior tothe Board meeting
Information placed before the Board
The following matters are tabled for the Boardrsquos periodicreview information
bull Annual operating plans amp budgets and periodic reviewof the Companyrsquos businesses
bull Quarterly performance
bull External Audit Management Reports (through the AuditCommittee)
bull Status of legal compliance
bull Status and effectiveness of risk management plans
bull Succession to senior management (through theNominations and Remuneration Committee)
bull Statutory compliance reports
bull Show cause demand prosecution adjudicationnotices if any from revenue authorities which areconsidered materially important including anyexposure that exceeds 1 of the Companyrsquos net worthand their outcome
12
bull W rite-offs disposals (fixed assets receivablesadvances etc) on a half-yearly basis
bull Significant development in Human Resources Industrial Relations
bull Material non-compliance of any regulatory or listingrequirements and in relation to shareholdersrsquoservices
bull All other matters required to be placed before theBoard for its review information under the ListingRegulations 2015 and other statutes
Post-meeting follow-up systemThe Governance processes in the Company include aneffective post-meeting follow-up review and reportingprocess for action taken pending on decisions of the Boardand the Board Committees
Details of Board Meeting during the financial year
During the financial year ended 31st March 2019 fourmeetings of the Board were held as follows
SI Date Board No ofNo Strength Directors
present
1 17th April 2018 6 6
2 7th August 2018 6 6
3 1st November 2018 6 5
4 30th January 2019 6 5
COMMITTEES OF THE BOARD
Currently there are three Committees of the Board ndash theAudit Committee the Stakeholders RelationshipCommittee and the Nominations and RemunerationCommittee The terms of reference of the BoardCommittees are determined by the Board from time to timeMeetings of Board Committees are convened by therespective Committee Chairman All the recommendationsmade by Board Committees during the year were acceptedby the Board Minutes of Board Committee meetings areplaced before the Board for its information The role andcomposition of these Committees including the numberof meetings held during the financial year and the relatedattendance are provided below
A AUDIT COMMITTEEThe Audit Committee of the Board provides reassurance tothe Board on the existence of an effective internal controlenvironment that ensuresbull efficiency and effectiveness of operations
bull safeguarding of assets and adequacy of provisionsfor all liabilities
bull reliability of financial and other managementinformation and adequacy of disclosures
bull compliance with all relevant statutesThe role of the Committee includes the followingbull To oversee the Companyrsquos financial reporting process
and the disclosure of its financial information to
REPORT ON CORPORATE GOVERNANCE
Directorsrsquo attendance at the Board Meetings during the financial year and at the last Annual General Meeting (AGM) as alsotheir other Directorships and Committee Memberships are given below
SI Director Category No of Attendance No of No of Membership(s) No Board at last other Chairmanship(s) of Audit
Meetings AGM Directorship(s) Committee Stakeholdersattended Relationship Committee of
other Indian public limitedcompanies
1 N Anand Chairman amp 4 Yes 8 1Non-Executive Director
2 C K Koshy Non-Executive 4 Yes Nil NilIndependent Director
3 R C Mehta1 Non-Executive 2 Yes 4 NilIndependent Director
4 M Narayanan Non-Executive 4 Yes 4 4 (all as Chairman)Independent Director
5 D R Choudhary Non-Executive Director 4 Yes 1 Nil6 J Singh Non-Executive Director 4 Yes 8 3 (including 1 as Chairman)
1 Resigned as Non-Executive Independent Director wef 1st April 2019 Details with respect to other Directorships of the Directors are provided under the section lsquoYour Directorsrsquo in the Report and Accounts
13
ensure that the financial statements are correctsufficient and credible
bull To recommend the appointment remuneration termsof appointment and removal of Statutory Auditors
bull To approve transactions of the Company with relatedparties
bull To evaluate the Companyrsquos internal financial controlsand risk management systems
bull To review with the management the following
- Annual financial statements and Auditorrsquos Reportthereon before submission to the Board forapproval
- Quarterly financial statements before submissionto the Board for approval
bull To review the following
- Management discussion and analysis of financialcondition amp results of operations and mattersrequired to be included in the DirectorsrsquoResponsibility Statement
- Adequacy of internal control systems and theCompanyrsquos statement on the same prior toendorsement by the Board such review to bedone in consultation with the managementStatutory and Internal Auditors
- Adequacy of internal control systems forcompliance with the provisions of the Securitiesand Exchange Board of India (Prohibition ofInsider Trading) Regulations 2015
- Reports of Internal Audit and discussion withInternal Auditors on any significant findings andfollow-up thereon
- Statutory Auditorsrsquo independence andperformance and effectiveness of the auditprocess
- System for storage retrieval security etc of booksof account maintained in the electronic form
- Functioning of Whistleblower mechanism in theCompany
Composition
The Audit Committee as on 15th April 2019 comprisesthree Non-Executive Directors two of whom are IndependentDirectors The Chairman of the Committee is anIndependent Director The Chief Executive Officer the ChiefFinancial Officer and the representative of Statutory Auditorsare Invitees to meetings of the Audit Committee and theCompany Secretary is the Secretary to the Committee Allmembers of the Committee are financially literate twomembers including the Chairman of the Committee haveaccounting and financial management expertise
The names of the members of the Audit Committeeincluding its Chairman are provided under the sectionlsquoBoard of Directors amp Committeesrsquo in the Report andAccounts
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Audit Committee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 4 4
2 7th August 2018 4 4
3 1st November 2018 4 3
4 30th January 2019 4 3
Attendance at Audit Committee Meetings during thefinancial year
Member No of meetingsattended
M Narayanan1 4
C K Koshy 4
R C Mehta2 2
J Singh 41 Appointed Chairman wef 15th April 20192 Ceased to be Member and Chairman wef 1st April 2019
B STAKEHOLDERS RELATIONSHIP COMMITTEE
The Stakeholders Relationship Committee of the Boardoversees redressal of shareholder and investor grievancesand inter alia approves transmission of sharessub-division consolidation renewal of share certificatesissue of duplicate share certificates etc
Composition
The Stakeholders Relationship Committee presentlycomprises three Non-Executive Directors including oneIndependent Director The Chairman of the Committee is aNon-Executive Director The Company Secretary is theSecretary to the Committee
The names of the members of the StakeholdersRelationship Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 sevenmeetings of the Stakeholders Relationship Committeewere held as follows
REPORT ON CORPORATE GOVERNANCE
14
SI Date Committee No ofNo Strength Members
present1 17th April 2018 2 2
2 29th June 2018 2 2
3 7th August 2018 2 2
4 27th September 2018 2 2
5 1st November 2018 2 2
6 4th January 2019 2 2
7 30th January 2019 2 2
Attendance at Stakeholders Relationship CommitteeMeetings during the financial year
Member No of meetingsattended
J Singh 7
D R Choudhury 7
C K Koshy 0
Appointed Member wef 31st March 2019
C NOMINATIONS AND REMUNERATION COMMITTEEThe Nominations and Remuneration Committee of theBoard inter alia identifies persons qualified to becomeDirectors and formulates criteria for evaluation ofperformance of the Directors and the Board as a wholeThe Committeersquos role includes recommending to theBoard the appointment remuneration and removal ofDirectors and Key Managerial Personnel
Composition
The Nominations and Remuneration Committee as on15th April 2019 comprises four Non-Executive Directorstwo of whom are Independent Directors The Chairman ofthe Committee is an Independent Director The CompanySecretary is the Secretary to the Committee
The names of the members of the Nominations andRemuneration Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 twomeetings of the Nominations and RemunerationCommittee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 5 5
2 30th January 2019 5 4
Attendance at Nominations and Remuneration CommitteeMeetings during the financial year
Member No of meetingsattended
C K Koshy 2
N Anand 2
R C Mehta1 1
M Narayanan 2
J Singh 21 Ceased to be Member wef 1st April 2019
Remuneration Policy
The Companyrsquos Remuneration Policy aims at attractingand retaining high calibre talent The Remuneration Policytherefore is market-led and takes into account thecompetitive circumstance of each business so as to attractand retain quality talent and leverage performancesignificantly
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpwwwgujarathotels ltd in polic ies Remuneration-Policy_GHLpdf There has been no change in the Policyduring the year
Remuneration of Directors
Non-Executive Directors are entitled to sitting fees forattending the meetings of the Board and its Committeesthe quantum of which is determined by the Board Thesitting fees to Non-Executive Directors as determined bythe Board are ` 20000- and ` 10000- for each meeting ofthe Board and its Committees respectively
Details of sitting fees paid to the Directors during thefinancial year ended 31st March 2019
Director Sitting Fees (`)
C K Koshy 150000-
R C Mehta1 70000-
M Narayanan 150000-1 Resigned as Non-Executive Independent Director wef1st April 2019
Note Disclosure with respect to Non-Executive Directors ndashPecuniary relationship or transaction None
Performance Evaluation
Performance evaluation of the Board the BoardCommittees and the individual Directors was carried outby the Board in accordance with the Policy approved by theNominations and Remuneration Committee in this regardbrief details of the same are provided in the lsquoReport of theBoard of Directors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
REPORT ON CORPORATE GOVERNANCE
15
Directorsrsquo Shareholding
Details of Shareholding of the Directors in the Company ason 31st March 2019 are given below
Director No of Equity Shares of ` 10-each held singly jointly
N Anand 200
D R Choudhury Nil
C K Koshy Nil
R C Mehta Nil
M Narayanan Nil
J Singh Nil
OTHER DISCLOSURESbull Details of non-compliances penalties and strictures
by Stock Exchanges SEBI Statutory Authorities onany matter related to capital markets during the lastthree years
Nonebull Inter-se relationships between Directors and Key
Managerial Personnel of the Company
Nonebull Materially significant related party transactions which
may have potential conflict with the interests of theCompany at large
Nonebull Material financial and commercial transactions of
senior management where they may have hadpersonal interest and which had potential conflict withthe interests of the Company at large
Nonebull Details of utilisation of funds raised through
preferential allotment or qualified institutionsplacement
Not Applicablebull Credit rating(s) obtained by the Company for any debt
instrument fixed deposit programme or any otherscheme involving mobilisation of funds
Nonebull None of the Directors of the Company has been
debarred or disqualified from being appointed orcontinuing as a Director by SEBI Ministry of CorporateAffairs Statutory Authorities which has also beenconfirmed by Messrs PB amp Associates PractisingCompany Secretaries
bull Confirmation by the Board with respect to theIndependent Directors is provided in the lsquoReport ofthe Board of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Disclosures in relation to the Sexual Harassment ofWomen at Workplace (Prevention Prohibition andRedressal) Act 2013 are provided in the lsquoReport of theBoard of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Information with respect to lsquoCommodity Price Risk orForeign Exchange Risk and Hedging Activitiesrsquo
Nonebull The total fees paid by the Company to Messrs K C
Mehta amp Co Statutory Auditors and all other entitiesforming part of the same network aggregate` 100000-
bull Compliance Officer under the Listing Regulations2015
Deepak Kumar Gulati Company Secretary
MEANS OF COMMUNICATION
Timely disclosure of consistent comparable relevant andreliable information on corporate financial performance isat the core of good governance Towards this end thequarterly results of the Company were announced withinforty five days from the end of the quarter Audited annualresults along with the results for the fourth quarter wereannounced within sixty days from the end of the financialyear Extract of these results were published in lsquoTheFinancial Expressrsquo (all editions) and in its Gujarati editionas vernacular newspaper Further quarterly resultsshareholding pattern and other material events amp importantinformation relating to the Company were submitted to BSELimited through BSE Listing Centre for dissemination onits website The Company publishes its quarterlyhalf-yearly and annual financial results and also posts suchresults on its website wwwgujarathotelsltdin
The Report of the Board of Directors forming part of theReport and Accounts includes all aspects of lsquoManagementDiscussion and Analysisrsquo as required under the ListingRegulations 2015
GHL CODE OF CONDUCT FOR PREVENTION OF INSIDERTRADING ndash 2019
The GHL Code of Conduct for Prevention of Insider Tradingapproved by the Board inter alia prohibits trading insecurities of the Company by Directors and employeeswhile in possession of unpublished price sensitiveinformation in relation to the Company
GHL CODE OF CONDUCT
The GHL Code of Conduct is applicable to Directors seniormanagement and employees of the Company The Codeis derived from three interlinked fundamental principlesviz good corporate governance good corporate citizenshipand exemplary personal conduct in relation to theCompanyrsquos business and reputation The Code coversGHLrsquos commitment to sustainable development concern
REPORT ON CORPORATE GOVERNANCE
16
for occupational health safety and environment a genderfriendly workplace transparency and auditability legalcompliance and the philosophy of leading by personalexample The Code is available on the Companyrsquos website
Declaration as required under the Listing Regulations 2015All Directors and senior management of the Companyhave affirmed compliance with the GHL Code of Conductfor the financial year ended 31st March 2019New Delhi K Pahwa15th April 2019 CEO
WHISTLEBLOWER POLICYSynopsis of the Whistleblower Policy of the Company isprovided in the lsquoReport of the Board of Directors ampManagement Discussion and Analysisrsquo forming part of theReport and Accounts The Whistleblower Policy is alsoavailable on the Companyrsquos websiteFAMILIARISATION PROGRAMME FOR DIRECTORSGHL believes that a Board which is well informed familiarised with the Company and its affairs can contributesignificantly to effectively discharge its role of trusteeshipin a manner that fulfils stakeholdersrsquo aspirations andsocietal expectations In pursuit of this the Directors of theCompany are updated on changes developments in thedomestic global corporate and industry scenario includingthose pertaining to statutes legislations and economicenvironment and on matters affecting the Company toenable them to take well informed and timely decisionsFurther details may be accessed on the Companyrsquos websiteat httpwwwgujarathotelsltdinpoliciesDirectorrsquos-Familiarisation-programmespdfPOLICY ON RELATED PARTY TRANSACTIONSThe Policy as approved by the Board may be accessed onthe Companyrsquos website at
h t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_TranscationspdfDISCRETIONARY REQUIREMENTS UNDER THE LISTINGREGULATIONS 2015The status of compliance with the discretionaryrequirements under the Listing Regulations 2015 isprovided below1 Chairmanrsquos Office The Company has a Non-Executive
Chairman but he does not maintain any separate officeand hence no expense in this regard is being incurredby the Company
2 Shareholder Rights The quarterly half-yearly andannual financial results of the Company are postedon the Companyrsquos website and extract of these resultsare published in newspapers on an all India basisThe complete Report and Accounts is sent to everyShareholder of the Company
3 Audit Opinion It has always been the Companyrsquosendevour to present financial statements with
unmodified audit opinion The Statutory Auditors haveissued an unmodified audit opinion on the Companyrsquosfinancial statements for the year ended 31st March2019
4 Separate posts of Chairman and Chief ExecutiveOfficer The Company has a Non-Executive Chairmanand a Chief Executive Officer
5 Internal Audit The Internal Auditor of the CompanyMessrs Shah amp Talati Chartered Accountants reportsto the Audit Committee of the Board
GENERAL SHAREHOLDER INFORMATIONProvided in the lsquoShareholder Informationrsquo section of theReport and Accounts
CONFIRMATION OF COMPLIANCEbull It is confirmed that the Company has complied with
the requirements prescribed under Regulations 17 to27 and clauses (b) to (i) of sub - regulation (2) ofRegulation 46 of the Listing Regulations 2015
bull The Statutory Auditorsrsquo Certificate that the Companyhas complied with the conditions of CorporateGovernance is annexed to the lsquoReport of the Board ofDirectors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
ANNEXURE TO THE REPORT ON CORPORATEGOVERNANCESKILLS EXPERTISE AND COMPETENCIES OF DIRECTORSThe Company believes that Board members should havea balance of skills experience and diversity of perspectivesappropriate to the Company Accordingly the Directorsshould possess one or more of the following skillsexpertise and competencies
1 Leadership
Leadership experience in a commensurate-sizedorganisation with understanding of organisationalsystems and processes strategic areas andemerging business trends
2 Industry Knowledge and Experience
Domain knowledge of Hotel business and itsdynamics long-term strategies and regulatory ampcompetitive environment
3 Finance and Accounting
Ability to understand financial policies accountingstatements and disclosure practices to contribute tothe financial risk management policies and practicesof the Company
4 Governance
Commitment belief and experience in settinggovernance practices to support the Companys legalcompliance systems and governance polic ies practices
REPORT ON CORPORATE GOVERNANCE
17
SHAREHOLDER INFORMATION
AGM Details
Date Saturday 7th September 2019Venue WelcomHotel Vadodara R C Dutt Road
Alkapuri Vadodara 390 007Time 1100 amBook Friday 30th August 2019 toClosure Saturday 7th September 2019Dates (both days inclusive)Dividend Friday 13th September 2019PaymentDate
Registrar and Share Transfer Agents
Messrs MCS Share Transfer Agent Limited are the Registrarand Share Transfer Agents (RTA) of the Company forcarrying out share registration and other related activitiesof the Company
Address for Correspondence
MCS Share Transfer Agent LimitedF-65 1st Floor Okhla Industrial AreaPhase ndash I New Delhi - 110 020Telephone Nos 011 4140 6149-52 4160 9386Facsimile No 011 4170 9881E-mail helpdeskdelhimcsregistrarscom
Shareholders holding shares in the dematerialised formshould address their correspondence except those relatedto dividend to their respective Depository Participants
Share Transfer Committee
The Share Transfer Committee of the Company generallymeets once in ten days for approving share transfers Theprocessing activities with respect to requests received forshare transfers are completed within fifteen days from thedate of receipt of request The Committee met 11 timesduring the financial year ended 31st March 2019 to approveshare transfers There were no share transfers pendingas on 31st March 2019
The Share Transfer Committee presently comprises thefollowing
D R Choudhury - Director MemberJ Singh - Director MemberM Agarwal - Compliance Officer Member
Dematerialisation of Shares and Liquidity
The shares of the Company are available for trading in thedematerialised form under both the Depository Systems inIndia - NSDL and CDSL The International SecuritiesIdentification Number (lSIN) allotted to the Companysshares under the Depository System is INE621C01011
As on 31st March 2019 a total of 3525013 Equity Sharesof the Company which translates to 9307 of the ShareCapital stood dematerialised The processing activitieswith respect to requests received for dematerialisation arecompleted between fifteen to thirty daysShareholder Investor ComplaintsThe Company attends to Shareholder Investor complaintsqueries and other correspondence generally within fifteendays except where constrained by disputes or legalimpedimentsThe Company did not receive any complaint during thefinancial year ended 31st March 2019The e-mail ID earmarked by the Company for this purposeghlinvestorsyahoocoinDistribution of Shareholding as on 31st March 2019
No of No of EquityNo of Shareholders Shares
SharesSlab Total to Total to
Share Shareholders Capital
1 - 500 5152 9455 587438 1551501 - 1000 138 253 112061 296
1001 - 2000 68 125 100167 2652001 - 3000 26 048 62030 1643001 - 4000 16 029 58804 1554001 - 5000 11 020 50785 1345001 - 10000 23 042 163405 431
10001 - 50000 8 015 147787 39050001 - 100000 3 006 226954 599
100001 amp Above 4 007 2278084 6015Total 5449 10000 3787515 10000
Categories of Shareholders as on 31st March 2019Sl Category No of toNo Shares Share
held hold ingA Promoter Holding1 Promoter and Promoter Group
ITC Limited 1733907 4578Russell Investments Limited 300056 792Sub-Total 2033963 5370
B Non Promoter Holding2 Institutional Investorsa Mutual Funds NIL NILb Banks 100 000c Foreign Institutional Investors and NIL NIL
Foreign Portfolio InvestorsSub-Total 100 000
3 Othersa Private Corporate Bodies 193726 511b Indian Public 1335461 3527c NRIs 102362 270d Others 121903 322
Sub Total 1753452 4630Grand Total 3787515 10000
18
Monthly High and Low Quotes and Volume of Sharestraded on BSE Limited
Year Month High L o w Volume(` ) (` ) (Nos)
2018 April 13800 12000 93584May 13100 11710 26778June 12735 11500 18090July 12195 11400 27113August 12295 11450 14900September 12000 10900 23492October 11400 10505 18787November 12975 10700 15386December 11490 10700 40291
2019 January 11320 10700 22160February 11185 10005 12395March 11295 10400 21625
Performance in comparison to broad based indices suchas SampP BSE Sensex
Note - Indicates monthly closing positions
Listing of Shares on Stock Exchange (with Stock Code)BSE Limited (507960)Phiroze Jeejeebhoy Towers Dalal Street Mumbai 400 001Telephone Nos 022-2272 1233 34Facsimile No 022-2272 1919E-mail isbseindiacomWebsite wwwbseindiacom
The Listing Fee for the financial year 2019-20 has beenpaid to BSE Limited
Financial CalendarFinancial Year 2019-20(1st April - 31st March)
1 First Quarter Results July 20192 Second Quarter and October November 2019
Half-Year Results3 Third Quarter Results January February 20204 Fourth Quarter and May 2020
Annual Results
Particulars of past three AGMsAGM Financial Venue Date Time Special
Year ResolutionPassed
36th 2017-18 WelcomHotel 07-08-2018 NoneVadodara
35th 2016-17 R C Dutt Road 08-08-2017 1100 NoneAlkapuri am
34th 2015-16 Vadodara 20-09-2016 None390 007
Postal Ballot
No special resolution requiring postal ballot was eitherproposed last year or is being proposed for the ensuing AGM
SHAREHOLDER REFERENCER
Transfer of Shares in certificate form
Effective 1st April 2019 transfer of shares of a listedcompany can only be effected in dematerialised form interms of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 Shareholders holdingshares in the certificate form are therefore requested todematerialise their shares in their own interestCommunication in this respect has been sent by theCompany during the year to the concerned ShareholdersHowever transfer deeds which were lodged with theCompany on or before 31st March 2019 but were returneddue to any deficiency will be processed upon re-lodgement
Transfer of Dividend and corresponding Equity Shares tothe Investor Education and Protection Fund (IEPF)
During the financial year 2018-19 unclaimed dividend forthe financial year 2010-11 aggregating ` 636444- andthe corresponding 13150 Equity Shares in respect of whichdividend entitlements remained unclaimed for sevenconsecutive years or more have been transferred by theCompany to the IEPF established by the CentralGovernment pursuant to the provisions of Section 124 ofthe Companies Act 2013 read with the Investor Educationand Protection Fund Authority (Accounting Audit Transferand Refund) Rules 2016
Shareholders may claim their unclaimed dividend for theyears prior to and including the financial year 2010-11 andthe corresponding shares from the IEPF Authority byapplying in the prescribed Form No IEPF-5 This Form canbe downloaded from the website of the IEPF Authoritywwwiepfgovin the access link of which is also availableon the Companys website wwwgujarathotelsltdin underthe section General Information under Shareholder Value
The unclaimed dividend for the undernoted years and thecorresponding shares will be transferred by the Companyto the IEPF in accordance with the schedule given belowAttention in particular is drawn that the unclaimed dividendfor the financial year 2011-12 and the corresponding shareswill be due for transfer to the IEPF on 14th September
SHAREHOLDER INFORMATION
19
Central Depository Services (India) LimitedMarathon Futurex A Wing 25th FloorMafatlal Mill Compound N M Joshi MargLower Parel Mumbai 400 013Telephone No 022-2302 3333Facsimile No 022-2300 2035E-mail helpdeskcdslindiacomWebsite wwwcdslindiacomRemittance of Dividend through Electronic ModeThe Company provides the facility for remittance of dividendto Shareholders through RTGS (Real Time GrossSettlement) NACH (National Automated Clearing House) NEFT (National Electronic Funds Transfer)
Shareholders who have not opted for remittance of dividendthrough electronic mode and wish to avail the same arerequired to provide their bank details including IFSC (IndianFinancial System Code) and MICR (Magnetic Ink CharacterRecognition) to their respective Depository Participants(DPs) or to the RTA where shares are held in thedematerialised form and in the certificate form respectively
Shareholders holding shares in the certificate form mayuse the Mandate Form for this purpose which can bedownloaded from the Companys websitewwwgujarathotelsltdin under the section GeneralInformation under Shareholder Value
Address and Bank DetailsShareholders holding shares in the certificate form arerequested to advise the RTA of any change in their address mandate bank details to facilitate better servicingShareholders are advised that as a measure of protectionagainst fraudulent encashment their bank details oraddress as available with the RTA will be printed on thedividend warrants or demand drafts where dividend cannotbe remitted through electronic mode
Permanent Account Number (PAN)Shareholders holding shares in the certificate form arerequested to send copies of their PAN Cards to the RTA tofacilitate better servicing
Furnishing of PAN Card however is mandatory as followsi) Transferees and Transferors PAN Cards for transfer
of sharesii) Legal heirs Nominees PAN Cards for transmission
of sharesiii) Surviving joint holders PAN Cards for deletion of name
of deceased Shareholders andiv) Joint holders PAN Cards for transposition of shares
Nomination Facility
Shareholders who hold shares in the certificate form andwish to make any nomination change nomination madeearlier in respect of their shareholding in the Companyshould submit to the RTA the prescribed Form such Formcan be downloaded from the Companys website underthe section Investor Relations under Shareholder Value
SHAREHOLDER INFORMATION
2019 for which purpose communication has been sent tothe concerned Shareholders advising them to write to theCompany to claim their dividend Notices in this regardhave also been published in newspapers Details of suchunclaimed dividend and corresponding shares areavailable on the Companys website under the sectionGeneral Information under Shareholder Value
Financial Date of declaration Due date for transferYear of Dividend to IEPF2011-12 8th August 2012 14th September 2019
2012-13 13th August 2013 19th September 2020
2013-14 29th September 2014 5th November 2021
2014-15 29th September2015 5th November 2022
2015-16 20th September 2016 26th October 2023
2016-17 8th August 2017 14th September 2024
2017-18 7th August 2018 12th September 2025
The Company will not be able to entertain any claim receivedafter 12th September 2019
Shareholders who have not so far encashed their dividendwarrant(s) or have not received the same are requested toapply for duplicate warrant(s) by writing to the Companyand confirming non-encashment non-receipt of dividendwarrant(s)
Service of Documents
The Company sends Notices Report and Accounts andother communications in electronic mode to thoseShareholders who have registered their e-mail addresseswith the Company or with the Depositories and in physicalmode to the other Shareholders
Shareholders who wish to register or update their e-mailaddresses with the Company may use the Form forregistration updation which can be downloaded from theCompanys website under the section Investor Relationsunder Shareholder Value
Depository Services
Shareholders may write to the respective Depository or tothe RTA for guidance on depository services
The contact details of the Depositories are given below
National Securities Depository LimitedTrade World A Wing 4th FloorKamala Mills CompoundSenapati Bapat Marg Lower ParelMumbai 400 013Telephone No 022-2499 4200Facsimile No 022-2497 6351E-mail infonsdlcoinWebsite wwwnsdlcoin
20
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
FOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019Your Directors submit their Report for the financial yearended 31st March 2019
BUSINESS ENVIRONMENT
The global economic growth softened to 36 in 2018representing a marked slowdown compared to the 39growth anticipated at the beginning of the year buoyed bya strong fiscal expansion in the USA which was offset largelyby slower growth in some other large economies ieEurope Japan etc Going forward global growth in 2019 isprojected to decline further to 33 in the base case withrisks to the downside emanating from politicaluncertainties rising trade tensions escalatingprotectionism and tighter financial conditions
As per Ministry of Statistics amp Programme Implementation(MSPI) Indian economy registered the GDP growth of 7in 2018-19 as compared to 72 in 2017-18 The economyis expected to grow and maintain a level of 75 in 2019and 2020 as per the World Bank estimates
India is the most digitally-advanced traveller nation in termsof digital tools being used for planning booking andexperiencing a journey During 2018 foreign tourist arrivals(FTAs) in India stood at 1056 million achieving a growthrate of 52 year-on-year The Government of India is alsoworking to achieve 1 share in worldrsquos international touristarrivals by 2020 and 2 share by 2025
The operating environment in the hospitality sector showedimprovement with foreign tourist arrivals Indiarsquos risingmiddle class and increasing disposable incomes havecontinued to support the growth of domestic tourism
With the inauguration of Statue of Sardar Vallabhbhai Patelalso known as lsquoStatute of Unityrsquo which is the higheststanding statue in the world at a height of 182 meters thetourism in the city of Vadodara is expected to grow
FINANCIAL PERFORMANCE
During the year under review your Company earned licensefees of ` 36987 lakhs (previous year ` 33098 lakhs)Theother income at ` 19626 lakhs showed an increase mainlydue to improvement in return on current investment Preand post-tax profits increased to ` 51822 lakhs (previousyear ` 45313 lakhs) and ` 40788 lakhs (previous year` 33690 lakhs) respectively
Your Directors are pleased to recommend a dividend of` 350 per Equity Share of ` 10- each for the year ended31st March 2019 thereby maintaining last yearrsquos dividendand involving a cash outflow of ` 160 lakhs includingDividend Distribution Tax of ` 27 Lakhs
PROFITS DIVIDEND AND RETAINED EARNINGS
The financial results of your Company summarised areas under
For the year ended For the year ended31st March 2019 31st March 2018
Profits (` ) (` )
a Profit Before Tax 51822363 45312928
b Tax Expense
Current Tax 11653499 9272310Deferred Tax (618755) 2350502
c Profit for the year 40787619 33690116
d Other Comprehensive Income - -
e Total Comprehensive Income 40787619 33690116
Statement of Retained Earningsa At the beginning of the year 213211090 195873461
b Add Total Comprehensive Income 40787619 33690116
c Less Dividend paid including IncomeTax on Dividend paid 15981176 15954974
d Less Income Tax on Dividend paid forearlier year - 397513
e At the end of the year 238017533 213211090
Your Directors are pleased to recommend a dividend of` 350 per Equity Share (Previous Year ` 350) of ` 10-each for the year ended 31st March 2019
Details of changes in Key Financial Ratio amp Return onNet Worth
The key financial ratio of the Company where there hasbeen significant change (25 or more) and change inReturn on Net Worth are summarized below pursuant toSchedule V (B) to the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements)Regulations 2015 (Listing Regulations 2015)
HOTEL OPERATIONS
Your Hotel WelcomHotel Vadodara licensed to ITC Limitedrecorded an income of ` 249443 lakhs during the year ascompared to ` 221856 lakhs in the previous year Therewas an improvement in both occupancy and average roomrates leading to an overall improvement in HotelPerformance
Financial Ratio
2018-19 2017-18 Change
Reason for change
Current Ratio
278 223 25 Increase in value of current investment based on accumulation of market return and fresh investment done during the year out of surplus funds
Return on Net Worth
133 120 11 Due to higher rate of growth in profit after tax
21
The Food amp Beverage segment of your Companyrsquos Hotelcontinues to be a major strength The Peshawri Restaurantand the Welcom Cafeacute Cambay both retained their premiumleadership positions
Your Company has filed a writ petition in the Gujarat HighCourt seeking that the Gujarat State Government be directedto take action on your Companyrsquos application to have theleasehold land of the Hotel converted to freehold andtransferred to your Company as per the existing governmentpolicy in this regard The Honourable High Court passedan Order on 24th December 2014 restraining the StateGovernment from disturbing the peaceful and actualpossession of the Company over the hotel property in anymanner including construction thereon The writ petition ispending
Your Company is also making all efforts for expeditiousconversion of land from leasehold to freehold or in thealternative extension of Lease For further details pleaserefer to Note no 20A of the Accounts
SUBSIDIARIES ASSOCIATES AND JOINT VENTURES
The Company does not have any subsidiary associate orjoint venture
INTERNAL FINANCIAL CONTROLS
Your Company is managed by the Board of Directors andthe Executive Management with clearly defined rolesresponsibilities and authorities The Executive Managementis responsible for the day-to-day conduct of the affairs ofthe Company within the overall framework approved by theBoard Your Company also has a Code of Conduct whichrequires management to conform to the required financialand accounting policies systems and processes conductbusiness ethically and ensure strict compliance with allapplicable laws and regulations Ongoing ReviewProcesses and the Risk Management Framework create acontrol environment in the Company and provide thecornerstones for Internal Financial Controls with referenceto your Companyrsquos Financial Statements
Your Companyrsquos Financial Statements are prepared on thebasis of the Significant Accounting Policies that are carefullyselected by the management and approved by the AuditCommittee and the Board These Policies are reviewedand updated from time to time and audited by the InternalAuditor whose findings and recommendations are reviewedby the Audit Committee and tracked through toimplementation
Your Company maintains its Books of Account in electronicform Your Company has in place adequate internalfinancial controls with reference to the FinancialStatements
The Internal Auditors of the Company evaluates theadequacy and efficacy of such internal financial controlsSuch controls have been assessed during the year by the
management Based on the results of this assessmentno reportable material weakness or significant deficienciesin the design or operation of internal financial controls wereobserved Nonetheless your Company recognises that anyinternal financial control framework no matter how welldesigned has inherent limitations and accordingly regularaudit and review processes ensure that such systems arereinforced on an ongoing basis
RISK MANAGEMENT
Your Company continues its emphasis on a systems-basedapproach to business risk managementBacked by stronginternal control systems the current Risk Managementframework consists of the following key elements
- The Board of Directors (lsquoThe Boardrsquo) has clearly laiddown the roles and responsibilities of the Company inrelation to risk management covering a range ofresponsibilities from strategic to operational Theserole definitions provide the foundation for yourCompanyrsquos Risk Management Policy that is endorsedby the Board and is aimed at ensuring formulation ofappropriate risk management procedures theireffective implementation and independent monitoringand reporting by Internal Audit
- Management of risks vest with the ExecutiveManagement which is responsible for the day-to-dayconduct of the affairs of the Company within the overallframework approved by the Board
- A combination of policies and procedures which areregularly reviewed and updated in the light of changingbusiness and regulatory environment bringsrobustness to the process of ensuring that businessrisks are effectively addressed
- Appropriate structures are in place to proactivelymonitor and manage the inherent risks in businesswith unique relatively high risk profiles
- An Independent Internal Audit Firm carries out riskfocused audits enabling identification of areas whererisk management processes may need to bestrengthened
- The Audit Committee of the Board reviews the InternalAudit findings and provides strategic guidance oninternal controls The Chief Executive Officer closelymonitors the internal control environment within yourCompany including implementation of the action plansemerging out of internal audit findings
The combination of policies and processes as outlinedabove adequately address the various risks associatedwith your Companyrsquos business
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
22
AUDIT AND SYSTEMS
Your Company believes that internal control is a necessaryadjunct to the principle of governance that freedom ofmanagement should be exercised within a framework ofappropriate checks and balances Your Company remainscommitted to ensuring an effective internal controlenvironment that provides assurance and comfort on orderlyand efficient conduct of operations security of assetsprevention and detection of frauds errors accuracy andcompleteness of accounting records and timely preparationof reliable financial information
Your Companyrsquos independent and robust Internal Auditprocesses provide assurance on the adequacy andeffectiveness of internal controls compliance withoperating systems internal policies and regulatoryrequirements
The Internal Audit function consisting of an outsourcedprofessional firm is adequately resourced to deliver highstandards of audit assurances
The Audit Committee of your Board met four times duringthe year The Terms of Reference of the Audit Committeeincluded reviewing the adequacy and effectiveness of theinternal control environment monitoring implementationof the action plans emerging out of Internal Audit findingsincluding those relating to strengthening of your Companyrsquosrisk management systems and discharge of statutorymandate
HUMAN RESOURCE DEVELOPMENT
Your Company firmly believes that employees are the vitaland most valuable assets and hence has created afavourable work environment that encourages innovationand meritocracy Your Company continues to innovate inthe way human resources are managed and developedstriking a balance between business needs and individualaspirations
With an undying commitment to render delightful servicesyour Companyrsquos employees consistently work towardsdelivering flawless performance and are continuing todelight customers
The Company provides a safe secure inclusive and genderfriendly workplace The Company has put in placeGrievance Redressal Procedures and adopted a Policy onSexual Harassment as per the provisions of the SexualHarassment of W omen at W orkplace (PreventionProhibition and Redressal) Act 2013 and the Rules framedthereunder The Company has an Internal ComplaintsCommittee to ensure that grievances in this regard if anyare effectively addressed During the year under review nocomplaint relating to sexual harassment has beenreceived
WHISTLEBLOWER POLICY
The Companyrsquos W histleblower Policy encouragesDirectors and employees to bring to the Companyrsquosattention instances of unethical behavior actual orsuspected incidents of fraud actual or suspectedinstances of leak of unpublished price sensitive informationor violation of the GHL Code of Conduct that could adverselyimpact the Companyrsquos operations business performanceand or reputation The Policy provides that the Companyinvestigates such incidents when reported in an impartialmanner and takes appropriate action to ensure that therequisite standards of professional and ethical conductare always upheld It is the Companyrsquos Policy to ensurethat no employee is victimised or harassed for bringingsuch incidents to the attention of the Company
The practice of the Whistleblower Policy is overseen by theAudit Committee and no employee has been denied accessto the Committee The Whistleblower Policy is available onthe Companyrsquos website at httpwwwgujarathotelsltdinCorporateGovernancehtml
DEPOSITS
Your Company has not accepted any deposits from thepublic members under Section 73 of the Companies Act2013 (lsquothe Actrsquo) read with the Companies (Acceptance ofDeposits) Rules 2014 during the year
DIRECTORS
Changes in Directors
Mr R C Mehta stepped down as Non-Executive IndependentDirector of the Company with effect from close of work on31st March 2019 keeping in view the Regulation 17(1A) ofthe Listing Regulations 2015 Your Directors would like torecord their appreciation for the services rendered byMr Mehta
The Board at the meeting held on 15th April 2019 on therecommendation of the Nominations and RemunerationCommittee recommended for the approval of the Membersthe re-appointment of Mr C K Koshy and Mr M Narayananas independent directors of your Company in terms ofSection 149 of the Act and Regulation 17 of the ListingRegulations 2015 with effect from 29th September 2019
Requisite Notices under Section 160 of the Act have beenreceived in respect of Messrs Koshy and Narayanan whohave filed their consents to act as Directors of the Companyif appointed
Appropriate resolutions seeking your approval to theaforesaid appointment will appear in the Notice conveningthe Thirty Seventh AGM of your Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
23
Retirement by Rotation
In accordance with the provisions of Section 152 of the Actread with Article 147 of the Articles of Association of theCompany Mr Jagdish Singh will retire by rotation at theensuing Annual General Meeting (lsquoAGMrsquo) of your Companyand being eligible offers himself for re-election Your Boardrecommends his re-election
Number of Board Meetings
During the year ended 31st March 2019 four meetings ofthe Board were held
Attributes Qualifications amp Independence of Directorsand their Appointment
As reported last year the Nominations and RemunerationCommittee of the Board had approved the criteria fordetermining qualifications positive attributes andindependence of Directors in terms of the Act and the Rulesthereunder both in respect of Independent Directors andother Directors as applicable The criteria inter aliarequires that NonndashExecutive Directors includingIndependent Directors be drawn from amongst eminentprofessionals with experience in business finance law public administration and enterprises
The Board Diversity Policy of the Company requires theBoard to have a balance of skills experience and diversityof perspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the lsquoReport on CorporateGovernancersquo forming part of the Report and Accounts TheArticles of Association of the Company provide that thestrength of the Board shall not be fewer than three normore than twelve
Directors are appointed re-appointed with the approval ofthe Members All Directors other than IndependentDirectors are liable to retire by rotation unless otherwiseapproved by the Members One-third of the Directors whoare liable to retire by rotation retire every year and areeligible for re-election
The Independent Directors of your Company haveconfirmed that (a) they meet the criteria of independenceas prescribed under Section 149 of the Act and Regulation16 of the Listing Regulations 2015 and (b) they are notaware of any circumstance or situation which could impairor impact their ability to discharge duties with an objectiveindependent judgement and without any external influenceFurther in the opinion of the Board the IndependentDirectors fulfil the conditions prescribed under the ListingRegulations 2015 and are independent of the managementof the Company
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpw w wg u j a ra th o te ls l td in p o l i c ies R em u n era t io n -
Policy_GHLpdf There has been no change in the Policyduring the year
Board Evaluation
The Nominations and Remuneration Committee hasapproved the Policy on Board Evaluation Evaluation ofBoard Committeesrsquo functioning and individual DirectorEvaluation and also specified that such evaluation will bedone by the Board Board performance is assessed againstthe role and responsibilities of the Board as provided inthe Act and the Listing Regulations 2015 The parametersfor Board performance evaluation have been derived fromthe Boardrsquos core role of trusteeship to protect and enhanceshareholder value as well as fulfil expectations of otherstakeholders through strategic supervision of the CompanyEvaluation of functioning of Board Committees is basedon discussions amongst Committee members and sharedby each Committee Chairman with the Board IndividualDirectors are evaluated in the context of the role played byeach Director as a member of the Board at its meetingsand in assisting the Board in realising its role of strategicsupervision of the functioning of the Company in pursuit ofits purpose and goals
While the Board evaluated its performance against theparameters laid down by the Nominations andRemuneration Committee the evaluation of individualDirectors was carried out anonymously in order to ensureobjectivity The Board was briefed on functioning of BoardCommittees by the respective Committee Chairmen
Key Managerial Personnel
Mr Deependra Rana resigned as the Chief Executive Officerof the Company with effect from 17th December 2018
The Board at the meeting held on 30th January 2019 onthe recommendation of the Nominations andRemuneration Committee appointed Mr Kunal Pahwa asthe Chief Executive Officer of the Company with effect from1st February 2019
AUDIT COMMITTEE amp AUDITORS
The composition of the Audit Committee is provided underthe section lsquoBoard of Directors amp Committeesrsquo in the Reportand Accounts
Statutory Auditors
The Statutory Auditors Messrs K C Mehta amp Co CharteredAccountants (KCM) were appointed with your approval atthe Thirty Fifth AGM to hold such office till the conclusion ofthe Fortieth AGM
On the recommendation of the Audit Committee the Boardrecommended for the approval of the Members paymentof remuneration of KCM for the financial year 2019-20Appropriate resolution for this purpose will appear in theNotice convening the Thirty Seventh AGM of the Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
24
Secretarial Auditors
Your Board appointed Messrs PB amp Associates CompanySecretaries to conduct the secretarial audit of the Companyfor the financial year ended 31st March 2019 Their Reportis provided in the Annexure forming part of this Report interms of Section 204 of the Act
RELATED PARTY TRANSACTIONS
All contracts or arrangements entered into by the Companywith its related parties during the financial year were inaccordance with the provisions of the Act and the ListingRegulations 2015 All such contracts or arrangements wereentered in the ordinary course of business and on armrsquoslength basis and have been approved by the AuditCommittee
Further the details of related party transactions of theCompany in prescribed Form No AOC-2 in terms of Section134 of the Act read with Rule 8 of the Companies (Accounts)Rules 2014 is given in the Annexure to this Report YourCompanyrsquos Policy on Related Party Transactions asadopted by your Board can be accessed on the website ath t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_Transactionspdf
DIRECTORSrsquo RESPONSIBILITY STATEMENT
As required under Section 134 of the Act your Directorsconfirm having
a) followed in the preparation of the Annual Accounts theapplicable Accounting Standards with properexplanation relating to material departures if any
b) selected such accounting policies and applied themconsistently and made judgements and estimates thatare reasonable and prudent so as to give a true andfair view of the state of affairs of your Company at theend of the financial year and of the profit of yourCompany for that period
c) taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with theprovisions of the Act for safeguarding the assets ofyour Company and for preventing and detecting fraudand other irregularities
d) prepared the Annual Accounts on a going concernbasis
e) laid down internal financial controls to be followed byyour Company and that such internal financial controlswere adequate and operating effectively and
f) devised proper systems to ensure compliance withthe provisions of all applicable laws and that suchsystems were adequate and operating effectively
OTHER INFORMATION
Compliance with the conditions of Corporate Governance
The certificate of the Statutory Auditors Messrs K C Mehtaamp Co Chartered Accountants confirming compliance withthe conditions of Corporate Governance as stipulated underthe Listing Regulations 2015 is annexed
Compliance with Secretarial Standards
The Company is in compliance with the applicableSecretarial Standards issued by the Institute of CompanySecretaries of India and approved by the CentralGovernment under Section 118 of the Act
Cost Records
The Company is not required to maintain cost records interms of Section 148 of the Act read with the Companies(Cost Records and Audit) Rules 2014
Going Concern Status
There is no significant or material order passed during theyear by any regulator court or tribunal impacting the goingconcern status of the Company or its future operations
Extract of Annual Return
The information required under Section 134 of the Act readwith Rule 12 of the Companies (Management andAdministration) Rules 2014 is annexed
Particulars of Loans Guarantees or Investments
During the year ended 31st March 2019 the Company hasneither given any loan or guarantee nor has made anyinvestment under the provisions of Section 186 of the Act
Particulars relating to Conservation of Energy andTechnology Absorption
Particulars as required under Section 134 of the Act relatingto Conservation of Energy and Technology Absorption areprovided below-
Conservation of Energy
Steps taken on conservation of energy and impact thereof
Sl DescriptionNo
1 Installation of energy efficient Gas Burners and Induction Cooker
2 Improvement in energy usage efficiency in lighting system by changingover to efficient lighting solutions such as Light Emitting Diodes
3 Replacement of existing motors and pumps with more energy efficientequipment
4 Process improvement to enhance productivity and reduce specificenergy consumption
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
25
There were no employees who were employed throughoutthe year and were in receipt of remuneration aggregating` 102 crores or more or were employed for part of the yearand were in receipt of remuneration aggregating ` 850lakhs per month or more during the financial year ended31st March 2019
The information pursuant to Section 197 of the Act readwith Rule 5(2) and 5(3) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014containing the names of top 10 employees in terms ofremuneration drawn is provided in the Annexure formingpart of this report
The information required under Section 197(12) of the Actand the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is provided in theAnnexure forming part of this Report
FORWARD-LOOKING STATEMENTS
This Report contains forward-looking statements thatinvolve risks and uncertainties When used in this Reportthe words lsquoanticipatersquo lsquobelieversquo lsquoestimatersquo lsquoexpectrsquo lsquointendrsquolsquowillrsquo and other similar expressions as they relate to theCompany and or its Businesses are intended to identifysuch forward-looking statements The Companyundertakes no obligation to publicly update or revise anyforward-looking statements whether as a result of newinformation future events or otherwise Actual resultsperformances or achievements could differ materially fromthose expressed or implied in such forward-lookingstatements Readers are cautioned not to place unduereliance on these forward-looking statements that speakonly as of their dates This Report should be read inconjunction with the financial statements included hereinand the notes thereto
CONCLUSION
Your Directors and employees look forward to the futurewith confidence and stand committed to creating an evenbrighter future for all stakeholders
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
Steps taken by the Company for utilising alternate sourcesof energy NIL
Capital investment on energy conservation equipment NIL
Technology Absorption
i) Efforts in brief made towards technology absorptionand benefits derived as a result of the above effortseg product improvement cost reduction productdevelopment import substitution etc
Sl Description BenefitsNo
1 Upgradation of Fire Alarm and For Product UpgradationPublic Announcement system
2 Installation of Hoods and Fire For Product UpgradationSuppression system
3 Upgradation of CCTV monitoring For Product Upgradationsystem
4 Upgradation of Electrical Panel For Product Improvement5 Induction of Diesel Generator For Product Improvement
ii) In case of imported technology (imported during thelast 3 years reckoned from the beginning of the financialyear) following information may be furnished
A) Details of technology imported - NIL
B) Year of import - NIL
C) Whether the technology has been fully absorbed -NIL
D) If not fully absorbed areas where absorption hasnot taken place and the reasons therefor - NIL
iii) Expenditure incurred on research and development -NIL
FOREIGN EXCHANGE EARNINGS AND OUTGO
During the financial year 2018-19 foreign exchangeearnings of the Hotel aggregated ` 111754 lakhs (previousyear ` 95887 lakhs) while expenditure in foreign currencyaggregated ` 5514 lakhs (previous year ` 3230 lakhs)
EMPLOYEES
The total number of employees of the Company as on31st March 2019 stood at 198
26
ANNEXURE
FORM NO MR ndash 3SECRETARIAL AUDIT REPORTFOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019[Pursuant to Section 204(1) of the Companies Act 2013 and Rule9 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014]
ToThe MembersGujarat Hotels LimitedWe have conducted the secretarial audit of the compliance ofapplicable statutory provisions and the adherence to goodcorporate practices by Gujarat Hotels Limited a Companyincorporated under the provisions of the Companies Act 1956 andhaving its Registered Office at WelcomHotel Vadodara R C DuttRoad Alkapuri Vadodara Gujarat ndash 390 007 (hereinafter referredto as the lsquoCompanyrsquo) for the period commencing from 1st April2018 till 31st March 2019 (hereinafter referred to as the lsquoAuditPeriodrsquo) Secretarial Audit was conducted in a manner that providedus a reasonable basis for evaluating the corporate conducts statutory compliances and expressing our opinions thereonBased on our verification of the books papers minute booksforms and returns filed and other records maintained by theCompany and also the information provided by the Company itsofficers agents and authorised representatives during the conductof Secretarial Audit 2018-19 we hereby report that in our opinionthe Company has during the audit period covering the FinancialYear ended on 31st March 2019 complied with the statutoryprovisions listed hereunder and also that the Company has properBoard-processes and compliance-mechanism in place to theextent in the manner and subject to the reporting made hereinafterWe have examined the books papers minute books forms andreturns filed and other records maintained by the Company for thefinancial year ended on 31st March 2019 according to theprovisions of(i) The Companies Act 2013 (the Act) and the Rules made
thereunder(ii) The Securities Contracts (Regulation) Act 1956 (lsquoSCRArsquo)
and the Rules made thereunder(iii) The Depositories Act 1996 and the Regulations and
Bye-laws framed thereunder(iv) Foreign Exchange Management Act 1999 and the Rules and
Regulations made thereunder to the extent of Foreign DirectInvestment Overseas Direct Investment and ExternalCommercial Borrowings
(v) The following Regulations and Guidelines prescribed underthe Securities and Exchange Board of India Act 1992(lsquoSEBI Actrsquo)-(a) The Securities and Exchange Board of India
(Substantial Acquisition of Shares and Takeovers)Regulations 2011
(b) The Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations 2015
(c) The Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations2015
(d) The Securities and Exchange Board of India(Registrars to an Issue and Share Transfer Agents)Regulations 1993 regarding the Companies Act anddealing with client
We have also examined compliance with the applicable clauses ofthe following(i) The mandatory Secretarial Standards issued by The Institute
of Company Secretaries of India with respect to BoardMeetings and General Meetings
(ii) The SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015
The Company has entered into an Operating Licence Agreementwith ITC Limited which operates the Hotel ndash WelcomHotel Vadodraand ensure compliance of all laws as applicable for running andmaintenance of the HotelDuring the period under review the Company has complied withthe provisions of the Act Rules Regulations Guidelines andStandards etc as mentioned above however in the CorporateGovernance Report filed pursuant to Regulation 27(2) of SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015with BSE for the quarter ended September and December 2018there is mismatch of date of the meetingWe further report thatThe Board of Directors of the Company is duly constituted withproper balance of Non-Executive Directors and IndependentDirectors The changes in the composition of the Board of Directorsthat took place during the period under review were carried out incompliance with provisions of the ActAdequate notice is given to all Directors for the Board Meetingsand Committees Meetings agenda and detailed notes on agendawere sent at least seven days in advance and where the meetingwas held in shorter notice due compliance was made and a systemexists for seeking and obtaining further information and clarificationson the agenda items before the meeting for meaningful participationat the meetingAll decisions at Board Meetings and Committee Meetings werecarried out unanimously as recorded in the minutes of the meetingsof the Board of Directors or Committees of the Board as the casemay beWe report that there are adequate systems and processes in theCompany commensurate with the size and operations of theCompany to monitor and ensure compliance with the applicableLaws Rules Regulations and GuidelinesWe further report that during the Audit Period the Company has nospecific events actions that have a major bearing on the Companyrsquosaffairs in pursuance of the above referred Laws RulesRegulations Guidelines Standards etc
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
Note This report is to be read with our letter of even date whichis annexed as Annexure A and forms an integral part of thisreport
27
FORM NO AOC-2[Pursuant to Section 134(3)(h) of the Companies Act 2013 and Rule 8(2) of the Companies (Accounts) Rules 2014]
Form for disclosure of particulars of contracts arrangements entered into by the Company with related parties referred to insub-section (1) of Section 188 of the Companies Act 2013 including certain arms length transactions under fourth proviso thereto
1 Details of contracts or arrangements or transactions not at arms length basis
a) Name(s) of the related party and nature of relationshipb) Nature of contracts arrangements transactionsc) Duration of the contracts arrangements transactionsd) Salient terms of the contracts or arrangements or transactions including the value if anye) Justification for entering into such contracts or arrangements or transactions NILf ) Date(s) of approval by the Boardg) Amount paid as advances if anyh) Date on which the special resolution was passed in general meeting as required under first proviso to Section 188
2 Details of material contracts or arrangement or transactions at arms length basis
a) Name(s) of the related party and nature of ITC Limited of which the Company is an Associaterelationship
b) Nature of contracts arrangements transactions Agreement for operating the Companyrsquos Hotel
c) Duration of the contracts arrangements Operating License Agreement (OLA) dated 24th September 1992 for an initialtransactions period of 30 years and renewable for another period of 30 years The OLA
emanated from the rehabilitation package agreed amongst Gujarat State GovtFinancial Institutions viz IFCI amp SBI and ITC in the year 1990
d) Salient terms of the contracts or arrangements The Company receives Licence fees 15 of Net Operating Income Valueor transactions including the value if any of transaction during the year ` 370 crores
e) Date(s) of approval by the Board if any 24th September 1992f ) Amount paid as advances if any Nil
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Annexure AToThe MembersGujarat Hotels Limited
Our report of even date is to be read along with this letter
1 Maintenance of secretarial record is the responsibilityof the management of the Company Our responsibilityis to express an opinion on these secretarial recordsbased on our audit
2 We have followed the audit practices and processesas were appropriate to obtain reasonable assuranceabout the correctness of the contents of the secretarialrecords The verification was done on the randomtest basis to ensure that correct facts are reflected insecretarial records We believe that the processesand practices we followed provide a reasonablebasis for our opinion
3 W e have not verified the correctness andappropriateness of financial records and books ofaccounts of the Company
4 W herever required we have obtained theManagement Representation about the complianceof Laws Rules and Regulations and happening ofevents etc
5 The compliance of the provisions of corporate andother applicable Laws Rules RegulationsStandards is the responsibility of management Ourexamination was limited to the verification ofprocedures on the random test basis
6 The Secretarial Audit Report is neither an assuranceas to the future viability of the Company nor of theefficacy or effectiveness with which the managementhas conducted the affairs of the Company
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
28
INDEPENDENT AUDITORSrsquo CERTIFICATE ON CORPORATE GOVERNANCE
INDEPENDENT AUDITORrsquoS CERTIFICATE ON CORPORATEGOVERNANCE
TO THE MEMBERS OF GUJARAT HOTELS LIMITED
1 We have examined the compliance of conditions ofCorporate Governance by Gujarat Hotels Limited (ldquotheCompanyrdquo) for the year ended on 31st March 2019as stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the Securities and Exchange Board ofIndia (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended(ldquoSEBI Listing Regulationsrdquo)
Managementrsquos Responsibility
2 The compliance of conditions of CorporateGovernance is the responsibility of the ManagementThis responsibility includes the designimplementation and maintenance of internal controland procedures to ensure the compliance with theconditions of the Corporate Governance stipulated inSEBI Listing Regulations
Auditorrsquos Responsibility
3 Our responsibility is limited to examining theprocedures and implementation thereof adopted bythe Company for ensuring the compliance of theconditions of the Corporate Governance It is neitheran audit nor an expression of opinion on the financialstatements of the Company
4 We have examined the books of account and otherrelevant records and documents maintained by theCompany for the purpose of providing reasonableassurance on the compliance with CorporateGovernance requirements by the Company
5 We have carried out an examination of the relevantrecords of the Company in accordance with theGuidance Note on Certification of CorporateGovernance issued by the Institute of CharteredAccountants of India (ldquothe ICAIrdquo) the Standards onAuditing specified under Section 143(10) of theCompanies Act 2013 in so far as applicable for the
purpose of this certificate and as per the GuidanceNote on Reports or Certificates for Special Purposesissued by the ICAI which requires that we comply withthe ethical requirements of the Code of Ethics issuedby the ICAI
6 W e have complied with the relevant applicablerequirements of the Standard on Quality Control (SQC)1 Quality Control for Firms that Perform Audits andReviews of Historical Financial Information and otherAssurance and Related Services Engagements
Opinion
7 Based on our examination of the relevant recordsand according to the information and explanationsprovided to us and representations provided by theManagement we certify that the Company hascomplied with the conditions of Corporate Governanceas stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the SEBI Listing Regulations asapplicable for the year ended 31st March 2019
8 W e state that such compliance is neither anassurance as to the future viability of the Companynor the efficiency or effectiveness with which theManagement has conducted the affairs of theCompany
Restrictions on Use
9 This Certificate is issued solely for the purpose ofcomplying with the aforesaid SEBI ListingRegulations and may not be suitable for any otherpurpose
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
29
ANNEXURE
FORM NO MGT-9EXTRACT OF ANNUAL RETURN
as on the Financial Year ended on 31st March 2019[Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the
Companies (Management and Administration) Rules 2014]
I REGISTRATION AND OTHER DETAILS
i) CIN L55100GJ1982PLC005408ii) Registration Date 7th August 1982iii) Name of the Company Gujarat Hotels Limitediv) Category Sub-Category of the Company Public company - Limited by sharesv) Address of the Registered office and contact details WelcomHotel Vadodara
R C Dutt Road AlkapuriVadodara 390 007Tel No 0265-233 0033E-mail ghlinvestorsyahoocoin
vi) Whether Listed Company Yesvii) Name Address and Contact details of MCS Share Transfer Agent Limited
Registrar and Transfer Agent if any F - 65 Okhla Industrial Area Phase - INew Delhi - 110 020Tel Nos (011) 4140 6149-52 4160 9386
II PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY
III PARTICULARS OF HOLDING SUBSIDIARY AND ASSOCIATE COMPANIES NIL
Sl No
Name and Description of main products services NIC Code of the products services
to total turnover of the Company
1 Hotel Services 55101 100
30
IV SHAREHOLDING PATTERN (Equity Share Capital Break-up as percentage of Total Equity)(i) Category-wise Shareholding
Category of Shareholders No of Shares held at the beginningof the year
No of Shares held at the endof the year
Changeduring the
year
A Promoters(1) Indiana) Individual HUF 0 0 0 0 0 0 0 0 0b) Central Govt 0 0 0 0 0 0 0 0 0c) State Govt(s) 0 0 0 0 0 0 0 0 0d) Bodies Corp 2033963 0 2033963 5370 2033963 0 2033963 5370 0e) Banks FI 0 0 0 0 0 0 0 0 0f ) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(1) 2033963 0 2033963 5370 2033963 0 2033963 5370 0(2) Foreigna) NRIs - Individuals 0 0 0 0 0 0 0 0 0b) Other - Individuals 0 0 0 0 0 0 0 0 0c) Bodies Corp 0 0 0 0 0 0 0 0 0d) Banks FI 0 0 0 0 0 0 0 0 0e) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(2) 0 0 0 0 0 0 0 0 0Total Shareholding of Promoter(A) = (A)(1)+(A)(2) 2033963 0 2033963 5370 2033963 0 2033963 5370 0B Public Shareholding1 Institutionsa) Mutual Funds 0 0 0 0 0 0 0 0 0b) Banks FI 0 100 100 0 100 100 c) Central Govt 0 0 0 0 0 0 0 0 0d) State Govt(s) 0 0 0 0 0 0 0 0 0e) Venture Capital Funds 0 0 0 0 0 0 0 0 0f ) Insurance Companies 0 0 0 0 0 0 0 0 0g) FIIs 10 0 10 0 0 0 h) Foreign Venture Capital Funds 0 0 0 0 0 0 0 0 0i) Others (specify) 0 0 0 0 0 0 0 0 0Sub-total (B)(1) 10 100 110 0 100 100 2 Non-Institutionsa) Bodies Corpi) Indian 300003 2200 302203 798 191626 2100 193726 511 (287)ii) Overseas 0 0 0 0 0 0 0 0 0b) Individualsi) Individual shareholders holding
nominal share capital upto` 1 lakh 774322 231562 1005884 2656 797094 203602 1000696 2643 (013)
ii) Individual shareholders holdingnominal share capital inexcess of ` 1 lakh 220814 0 220814 583 334765 0 334765 884 301
c) Others (specify)i) Non Resident Individuals 44288 71500 115788 306 45662 56700 102362 270 (036)ii) Investor Education and
Protection Fund AuthorityMinistry of Corporate Affairs 108753 0 108753 287 121903 0 121903 322 035
Sub-total (B)(2) 1448180 305262 1753442 4630 1491050 262402 1753452 4630 0Total Public Shareholding(B)=(B)(1)+ (B)(2) 1448190 305362 1753552 4630 1491050 262502 1753552 4630 0C Shares held by Custodian
for GDRs amp ADRs 0 0 0 0 0 0 0 0 0Grand Total (A+B+C) 3482153 305362 3787515 100 3525013 262502 3787515 100 0
Demat Physical Total of TotalShares
Demat Physical Total of TotalShares
ANNEXURE
31
1 Savi Portfolio Management Services LimitedAt the beginning of the year 122218 323Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 122218 323
2 Muktilal Ganulal PaldiwalAt the beginning of the year 82742 218Increase Decrease in Shareholding during the year06042018 220 001 82962 21913042018 250 001 83212 22001062018 927 002 84139 22215062018 700 002 84839 22427072018 412 001 85251 22505102018 1000 003 86251 22830112018 500 001 86751 22931122018 958 003 87709 23218012019 124 000 87833 23208022019 1070 003 88903 23501032019 467 001 89370 23615032019 1000 003 90370 23922032019 200 001 90570 24031032019 50 000 90620 240At the end of the year 90620 240
3 Taradevi Muktilal PaldiwalAt the beginning of the year 31628 084
(ii) Shareholding of Promoters (including Promoter Group)
(iii) Change in Promotersrsquo Shareholding (please specify if there is no change)
SlNo
Shareholders NameNo of
Shares of total
Sharesof the
Company
of Sharespledged
encumbered tototal Shares
No ofShares
of totalShares
of theCompany
of Sharespledged
encumbered tototal Shares
change inShareholding
during the year
1 ITC Limited 1733907 4578 Nil 1733907 4578 Nil Nil
2 Russell Investments Limited 300056 792 Nil 300056 792 Nil Nil
Shareholding at the beginning of the year Shareholding at the end of the year
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
(iv) Shareholding Pattern of top ten Shareholders (other than Directors Promoters and Holders of GDRs and ADRs)
ANNEXURE
No of Shares
Sl No
Particulars Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares of total Shares of the Company
No of Shares of total Shares of the Company
At the beginning of the year
No Change during the year Increase Decrease in Promoters Shareholding during the year
At the end of the year
32
Increase Decrease in Shareholding during the year06042018 180 000 31808 08413042018 53 000 31861 08420042018 1449 004 33310 08827042018 1933 005 35243 09304052018 1060 003 36303 09611052018 2196 006 38499 10218052018 1343 004 39842 10625052018 1191 003 41033 10906072018 1600 004 42633 11313072018 1678 004 44311 11720072018 2095 006 46406 12327072018 3735 010 50141 13303082018 415 001 50556 13410082018 685 002 51241 13624082018 1169 003 52410 13931082018 1616 004 54026 14307092018 1655 004 55681 14714092018 1311 003 56992 15021092018 2480 007 59472 15729092018 2259 006 61731 16305102018 1534 004 63265 16712102018 976 003 64241 17019102018 64 000 64305 17026102018 600 002 64905 17202112018 605 002 65510 17409112018 4 000 65514 17416112018 143 000 65657 17430112018 2299 006 67956 18007122018 515 001 68471 18114122018 10 000 68481 18121122018 590 002 69071 18331122018 600 002 69671 18504012019 1000 003 70671 18825012019 21 000 70692 18801022019 701 002 71393 19008022019 388 001 71781 19115022019 714 002 72495 19301032019 700 002 73195 19515032019 34 000 73229 195At the end of the year 73299 195
4 Shah Viren ShantilalAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 14122018 26965 071
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
ANNEXURE
33
Increase Decrease in Shareholding during theyear ie wef 1412201811012019 28946 076 55911 14701022019 7194 019 63105 166At the end of the year 63105 166
5 Chirayush Pravin VakilAt the beginning of the year 27482 073Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 27482 073
6 Falguni Nilesh DedhiaAt the beginning of the year 18000 048Increase Decrease in Shareholding during the year27042018 5175 014 23175 062At the end of the year 23175 062
7 Classic Realties Private LimitedAt the beginning of the year 23061 061Increase Decrease in Shareholding during the year31082018 100 000 23161 061At the end of the year 23161 061
8 Dheeraj Kumar LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 20000 053
9 Karvy Stock Broking LimitedAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 30112018 23063 061Increase Decrease in Shareholding during theyear ie wef 3011201807122018 149 000 23212 06114122018 (8165) (022) 15047 03931122018 7128 019 22175 05804012019 3087 008 25262 06611012019 (23721) (063) 1541 00331032019 15274 040 16815 043At the end of the year 16815 043 Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company Includes shares acquired during the period when not part of the top ten Shareholders of the Company
10 Sonal LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year20042018 (1000) (003) 19000 050
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
34
311218 0 000 0 00011012019 0 000 0 00031032019 (5000) (013) 14000 037At the end of the year 14000 037 Ceased to be part of the top ten Shareholders of the Company Became a part of the top ten Shareholders of the Company
11 Rajasthan Global Securities Private LimitedAt the beginning of the year 98659 260Increase Decrease in Shareholding during the year20042018 (4756) (013) 93903 24727042018 (5596) (015) 88307 23206072018 (790) (002) 87517 23027072018 (8520) (022) 78997 20802112018 (10975) (029) 68022 17916112018 (4) 000 68018 17930112018 (6189) (016) 61829 16307122018 (170) 000 61659 16314122018 (18503) (049) 43156 11421122018 (417) (001) 42739 11331122018 (11108) (029) 31631 08404012019 (5000) (013) 26631 07111012019 (5000) (013) 21631 05825012019 (2800) (007) 18831 05101022019 0 000 0 000At the end of the year NA NA Ceased to be a part of the top ten Shareholders of the Company
12 Dinesh Mukilal PaldiwalAt the beginning of the year 10522 028Increase Decrease in Shareholding during the year03082018 112 000 10634 02810082018 424 001 11058 02907092018 500 001 11558 03021092018 85 000 11643 03005102018 1000 003 12643 03302112018 0 000 12643 03301022019 0 000 12643 03315022019 300 001 12943 03431032019 0 000 12943 034At the end of the year NA NA Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company
Note Increase decrease in shareholding as indicated above are based on downloads of beneficial ownership provided by the Depositories generally everyFriday
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
35
(v) Shareholding of Directors and Key Managerial Personnel
ANNEXURE
Ms D R Choudhury Messrs C K Koshy R C Mehta M Narayanan and J Singh Directors Messrs M Agarwal andD K Gulati Key Managerial Personnel did not hold any Shares of the Company either at the beginning or at the end of theyear or at any time during the year
Mr K Pahwa Chief Executive Officer also did not hold any Shares of the Company either at the time of his appointment or atthe end of the year or at any time during the year
V INDEBTEDNESSIndebtedness of the Company including interest outstanding accrued but not due for payment NIL
VI REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNELA Remuneration to Managing Director Wholetime Directors and or Manager NOT APPLICABLE
B Remuneration to the other Directors(Amount in `)
Ceased to be Non-Executive Independent Director with close of work on 31st March 2019
Sl No For each of the Director
Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares held singly
jointly
of total Shares of the
Company
No of Shares held singly
jointly
of total Shares of the
Company
1 N Anand (Chairman)
At the beginning of the year 200 0
Increase Decrease in Shareholding during the year
0 0 0 0
At the end of the year 200 0
Sl No Directors
Particulars of Remuneration
Total Amount Fee for attending Board Board
Committee Meetings
Commission Independent Directors
Meeting Fees 1 Independent Directors
C K Koshy 140000 0 10000 150000 R C Mehta 70000 0 0 70000 M Narayanan 140000 0 10000 150000
Total (B)(1) 350000 0 20000 370000 2 Other Non-Executive Directors
N Anand 0 0 0 0 D R Choudhury 0 0 0 0 J Singh 0 0 0 0
Total (B)(2) 0 0 0 0 Total (B) = (B)(1) + (B)(2) 370000 Total Managerial Remuneration (A+B) 370000
Overall ceiling as per the Act (Being 11 of the Net Profits of the Company as calculated under Section 198 of the Companies Act 2013)
3759620
36
C Remuneration to Key Managerial Personnel other than MD Manager WTD(Amount in `)
Mr K Pahwa was appointed as Chief Executive Officer wef 1st February 2019
VII PENALTIES PUNISHMENT COMPOUNDING OF OFFENCES
against the Company Directors and other Officers in Default under the Companies Act 2013 NONE
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Sl No
Particulars of Remuneration Key Managerial Personnel
Total Amount
K Pahwa Chief Executive
Officer
M Agarwal Chief Financial
Officer
D K Gulati Company Secretary
1 Gross Salary
(a) Salary as per provisions contained in Section 17(1) of the Income-tax Act 1961
377472 2883242 880140 4140854
(b) Value of perquisites under Section 17(2) of the Income-tax Act 1961
242908 136154 0 379062
(c) Profits in lieu of salary under Section 17(3) of the Income-tax Act 1961
0 0 0 0
2 Stock Option 0 0 0 0 3 Sweat Equity 0 0 0 0 4 Commission
- as of profit - others specify
0 0 0 0
5 Others please specify 0 0 0 0 Total Amount 620380 3019396 880140 4519916
37
Services reverted to ITC Limited effective 17th December 2018 Reflects revision in remuneration effective 1st October 2018
Notes1 The number of permanent employees as on 31st March 2019 was 1982 Compared to 2017-18 the figures for 2018-19 reflect that
i) Median remuneration of employees - Increased by 965ii) Average remuneration of employees excluding Key Managerial Personnel (KMP) - Increased by 1040 with
increase in number of employeesiii) Remuneration of KMP - Increased by 1321 due to revision in remuneration during the year
3 Remuneration of Directors KMP and other employees is in accordance with the Companys Remuneration Policy
A Information pursuant to Section 197 of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014
Name of Directors ampKey ManagerialPersonnel
Designation Ratio of Remuneration toMedian Remuneration of
all employees
Increase inRemuneration over
LY ()
ANNEXURE
N Anand Non-Executive Chairman - -
D R Choudhury Non-Executive Director - -
C K Koshy Independent Director 0731 7
R C Mehta Independent Director 0341 -
M Narayanan Independent Director 0731 7
J Singh Non-Executive Director - -
D Rana Chief Executive Officer 12681 (15)
K Pahwa Chief Executive Officer (wef 1st February 2019) 3111 -
M Agarwal Chief Financial Officer 15281 24
D K Gulati Company Secretary 4371 8
38
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INFORMATION US 197 OF THE COMPANIES ACT 2013
39
CEO AND CFO COMPLIANCE CERTIFICATE
We Kunal Pahwa Chief Executive Officer and Mayur Agarwal Chief Financial Officer certify that
a) We have reviewed the financial statements including the cash flow statement for the year ended 31st March 2019 andto the best of our knowledge and belief
i) these statements do not contain any materially untrue statement or omit any material fact or contain statementsthat might be misleading
ii) these statements together present a true and fair view of the Companyrsquos affairs and are in compliance with IndianAccounting Standards applicable laws and regulations
b) To the best of our knowledge and belief no transactions entered into by the Company during the year ended31st March 2019 are fraudulent illegal or violative of the Companyrsquos code of conduct
c) We accept responsibility for establishing and maintaining internal controls for financial reporting and we have evaluatedthe effectiveness of the internal control systems of the Company pertaining to financial reporting Deficiencies in thedesign or operation of such internal controls if any of which we are aware have been disclosed to the auditors and theAudit Committee and steps have been taken to rectify these deficiencies
d) i) There has not been any significant change in internal control over financial reporting during the year underreference
ii) The changes in the Significant Accounting Policies arising from the adoption of the Indian Accounting Standardshave been discussed with the auditors and have been approved by the Audit Committee and
iii) We are not aware of any instance during the year of significant fraud with involvement therein of the managementor any employee having a significant role in the Companyrsquos internal control system over financial reporting
Place New Delhi Kunal Pahwa Mayur AgarwalDate 15th April 2019 Chief Executive Officer Chief Financial Officer
40
BALANCE SHEET
As at 31st March 2019Amount in `
Particulars Note As at As at31st March 2019 31st March 2018
ASSETSNon-Current Assetsa) Property Plant and Equipment 2 14695652 15623727b) Other Non-Current Assets 3 6672434 7609451Total Non-Current Assets 21368086 23233178Current Assetsa) Financial Assets
(i) Investments 4 280294894 208482957(ii) Trade Receivables 5 16310661 14154244(iii) Cash and Cash Equivalents 6 763039 900355(iv) Other Bank Balances 7 5489856 53182631(v) Other Financial Assets 8 4724316 6349124
b) Other Current Assets 3 437564 406324Total Current Assets 308020330 283475635Total Assets 329388416 306708813EQUITY AND LIABILITIESEquitya) Equity Share Capital 9 37875150 37875150b) Other Equity 268275037 243468594Total Equity 306150187 281343744LIABILITIESNon-Current Liabilitiesa) Provisions 10 1399224 1270990b) Deferred Tax Liabilities (Net) 11 10745247 11364002Total Non-Current Liabilities 12144471 12634992Current Liabilitiesa) Financial Liabilities
(i) Trade Payablesa) Total outstanding dues of micro enterprises and
small enterprises ndash ndashb) Total outstanding dues of creditors other than
micro enterprises and small enterprises 483074 395920(ii) Other Financial Liabilities 12 9272344 11118126
b) Other Current Liabilities 13 1264039 1172866c) Provisions 10 74301 43165Total Current Liabilities 11093758 12730077Total Equity And Liabilities 329388416 306708813
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
41
STATEMENT OF PROFIT AND LOSS
For the year ended 31st March 2019Amount in `
I Revenue From Operations 14 36986948 33098499
II Other Income 15 19625544 17119109
III Total Income (I+II) 56612492 50217608
IV EXPENSES
Employee Benefits Expense 16 1208580 1094609
Depreciation and Amortization Expense 473636 475984
Other Expenses 17 3107913 3334087
Total Expenses (IV) 4790129 4904680
V Profit Before Tax (III- IV) 51822363 45312928
VI Tax Expense
Current Tax 18 11653499 9272310
Deferred Tax 18 (618755) 2350502
VII Profit for the Year (V-VI) 40787619 33690116
VIII Other Comprehensive Income ndash ndash
IX Total Comprehensive Income for the Year (VII+VIII) 40787619 33690116
X Earnings per Equity Share (Face Value ` 10-each) 19
Basic (in `) 1077 890
Diluted (in `) 1077 890
For the Year For the YearParticulars Note ended ended
31st March 2019 31st March 2018
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
42
For the year ended 31st March 2019
STATEMENT OF CHANGES IN EQUITY
The Board of Directors of the Company recommended a dividend of ` 35 per share (for the year ended 31st March 2018 - dividend ` 350 pershare) be paid on fully paid equity shares This equity dividend is subject to approval by shareholders at the Annual General MeetingThe totalequity dividend to be paid ` 13256303 (for the year ended 31st March 2018 - dividend ` 13256303) Income tax on proposed dividend being` 2724873 (for the year ended 31st March 2018 - ` 2724873)
General Reserve This Reserve is created by an appropriation from one component of equity (generally retained earnings) to another notbeing an item of Other Comprehensive Income The same can be utilized by the Company in accordance with the provisions of the CompaniesAct 2013
Retained Earnings This Reserve represents the cumulative profits of the Company This Reserve can be utilized in accordance with theprovisions of the Companies Act 2013
The accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even dateOn behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
A Equity Share CapitalAmount in `
Balance as at the Changes in equity Balance at thebeginning of the share capital end of the
reporting year during the year reporting yearFor the year ended 31st March 2018 37875150 ndash 37875150For the year ended 31st March 2019 37875150 ndash 37875150
B Other EquityAmount in `
Reserves amp Surplus TotalGeneral Reserve Retained Earnings
Balance as at April 01 2017 30257504 195873461 226130965Total Comprehensive Income for the year ndash 33690116 33690116Dividend ndash 13256303 13256303Income Tax on Dividend Paid ndash 2698671 2698671Dividend Distribution Tax (earlier year) ndash 397513 397513Balance as at March 31 2018 30257504 213211090 243468594Balance as at April 01 2018 30257504 213211090 243468594Total Comprehensive Income for the year ndash 40787619 40787619Dividend ndash 13256303 13256303Income Tax on Dividend Paid 2724873 2724873Balance as at March 31 2019 30257504 238017533 268275037
43
CASH FLOW STATEMENT
For the year ended 31st March 2019
For the Year For the YearParticulars ended ended
31st March 2019 31st March 2018
NOTES1) The above Cash Flow Statement has been prepared under the ldquoIndirect Methodrdquo as set out in Ind AS 7Statement of Cash FlowsrdquoThe accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even date On behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
Amount in `
A Cash Flow from Operating ActivitiesPROFIT BEFORE TAX 51822363 45312928Adjustments for
Depreciation amp Amortisation expense 473636 475984Interest Income (1317822) (3453950)Dividend Income (159984) (178075)Loss on sale of property plant and equipment - Net 445778 (28273)Net gain(loss) on investments mandatorily measuredat fair value through profit or loss (18005340) (13358789)Other Non Operating Income ndash (86856)Other Non Operating Expense ndash 99378
OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 33258631 28782347Adjustments for
Trade Receivables Financial Assets and Other Assets (2815198) (90661)Trade Payables Other Liabilities and Provisions (1568800) 1700052
CASH GENERATED FROM OPERATIONS 28874633 30391738Income Tax Paid(Net) (10407981) (12740273)
NET CASH FROM OPERATING ACTIVITIES 18466652 17651465B Cash Flow from Investing Activities
Sale of Property Plant and Equipment 8661 58452Purchase of Current Investments (224340000) (186220000)SaleRedemption of Current Investments 170532754 183295529Dividend Income 159984 178075Interest Received 3262318 4031382
NET CASH FROM INVESTING ACTIVITIES (50376283) 1343438C Cash Flow from Financing Activities
Dividend Paid (13256303) (13256303)Income Tax on Dividend Paid (2724873) (2698671)
NET CASH FROM FINANCING ACTIVITIES (15981176) (15954974)NET INCREASE IN CASH AND CASH EQUIVALENTS (47890807) 3039929OPENING CASH AND CASH EQUIVALENTS 48653846 45613917CLOSING CASH AND CASH EQUIVALENTS 763039 48653846
CASH AND CASH EQUIVALENTS COMPRISE Cash cheques and current accounts 763039 900355Other Bank BalancesDeposits with original maturity more than 3 months having remainingmaturity less than 12 months from Balance Sheet date ndash 47753491
763039 48653846
44
1 SIGNIFICANT ACCOUNTING POLICIESStatement of ComplianceThese financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) notifiedunder section 133 of the Companies Act 2013 (the Act) read with Companies (Indian Accounting Standards)Rules 2015 (as amended) The financial statements have also been prepared in accordance with the relevantpresentation requirements of the Companies Act 2013
Basis of PreparationThe financial statements are prepared in accordance with the historical cost convention except for certain itemsthat are measured at fair values as explained in the accounting policies below The financial statements arepresented in Indian Rupees (INR) which is also the Companyrsquos functional currency
Fair Value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transactionbetween market participants at the measurement date regardless of whether that price is directly observable orestimated using another valuation technique In estimating the fair value of an asset or a liability the Companytakes into account the characteristics of the asset or liability if market participants would take those characteristicsinto account when pricing the asset or liability at the measurement date
The preparation of financial statements in conformity with Ind AS requires management to make judgementsestimates and assumptions that affect the application of the accounting policies and the reported amounts ofassets and liabilities the disclosure of contingent assets and liabilities at the date of the financial statementsand the reported amounts of revenues and expenses during the year Actual results could differ from those estimatesThe estimates and underlying assumptions are reviewed on an ongoing basis Revisions to accounting estimatesare recognised in the period in which the estimate is revised if the revision affects only that period they arerecognised in the period of the revision and future periods if the revision affects both current and future periods
All assets and liabilities have been classified as current or non-current as per the Companyrsquos normal operatingcycle and other criteria set out in the Schedule III to the Companies Act 2013 and Ind AS 1 ndash Presentation ofFinancial Statements based on the nature of business and the time between the acquisition of assets for processingand their realisation in cash and cash equivalents
Property Plant amp Equipment ndash Tangible AssetsProperty plant amp equipment are stated at cost of acquisition or construction less accumulated depreciation andimpairment if any For this purpose cost includes deemed cost which represents the carrying value of propertyplant and equipment recognised as at 1st April 2015 measured as per the previous GAAP
Cost is inclusive of inward freight duties and taxes and incidental expenses related to acquisition In respect ofmajor projects involving construction related pre-operational expenses form part of the value of assets capitalisedExpenses capitalised also include applicable borrowing costs for qualifying assets if any Subsequent costs areincluded in the assetrsquos carrying amount only when it meets the recognition criteria are met as per componentaccounting The carrying amount of a replaced part is derecognized All other repairs and maintenance are chargedto the statement of Profit amp Loss
An item of property plant and equipment is derecognized upon disposal or when no future economic benefits areexpected to arise from the continued use of asset Any gain or loss arising on the disposal or retirement of an itemof property plant and equipment is determined as the difference between the sales proceeds and the carryingamount of the asset and is recognised in Statement of Profit and Loss
Depreciation of these assets commences when the assets are ready for their intended use which is generally oncommissioning Items of Property Plant and Equipment are depreciated in a manner that depreciates the cost ofthe assets after commissioning (or other amount substituted for cost) less its residual value over their usefullives as specified in Schedule II of the Companies Act 2013 on a straight line basis
Property plant and equipmentrsquosrsquo residual values and useful lives are reviewed at each balance sheet date andchanges if any are treated as changes in accounting estimate
NOTES TO THE FINANCIAL STATEMENTS
45
NOTES TO THE FINANCIAL STATEMENTS
Useful lives of different class of PPE are as follows
Particulars Useful Life as per Schedule IIBuilding 60 Years
Plant and Equipment 15 Years
Furnitures and fixtures 8 years
Office equipment 5 Years
Impairment of AssetsImpairment loss is provided if any to the extent the carrying amount of assets or cash generating units exceedtheir recoverable amount
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amountmay not be recoverable
Recoverable amount is higher of an assetrsquos net selling price and its value in use Value in use is the present valueof estimated future cash flows expected to arise from the continuing use of an asset or cash generating unit andfrom its disposal at the end of its useful life
Impairment losses recognised in prior years are reversed when there is an indication that the impairment lossesrecognised no longer exist or have decreased Such reversals are recognised as an increase in carrying amountsof assets to the extent that it does not exceed the carrying amounts that would have been determined (net ofamortisation or depreciation) had no impairment loss been recognised in previous years
Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodiedin the asset are considered to modify the amortisation period or method as appropriate and are treated aschanges in accounting estimates
Financial instruments Financial Assets and Financial LiabilitiesFinancial assets and financial liabilities are recognized when the Company becomes a party to the contractualprovisions of the relevant instrument Transaction cost that are directly attributable to the acquisition or issue offinancial assets and financial liabilities (other than financial assets and financial liabilities measured at fair valuethrough profit or loss) are added to or deducted from the fair value on initial recognition of financial assets andfinancial liabilities Purchase or sale of financial assets that require delivery of assets within a time frame establishedby regulation or convention in the market place (regular way trades) are recognized on the trade date ie the datewhen the Company commits to purchase or sell the asset
Financial AssetsRecognition Financial assets includes Investments Trade receivable Advances Security Deposits Cash andcash equivalents Such Assets are initially recognized at transaction price when the company becomes party tocontractual obligations The transaction price includes transaction cost unless the assets is being fair valuedthrough the Statement of Profit and Loss
Classification Management determines the classification of an asset at initial recognition depending on thepurpose for which the assets were acquired The subsequent measurement of financial assets depends on suchclassification
Financial assets are classified as those measured at
(a) Amortised cost where the financial assets are held solely for collection of cash flows arising from payments ofprincipal and or interest
(b) Fair value through other comprehensive income (FVTOCI) where the financial assets are held not only forcollection of cash flows arising from payments of principal and interest but also from the sale of such assetsSuch assets are subsequently measured at fair value with unrealised gains and losses arising from changesin the fair value being recognised in other comprehensive income
46
NOTES TO THE FINANCIAL STATEMENTS
(c) Fair value through profit or loss (FVTPL) where the assets are managed in accordance with an approvedinvestment strategy that triggers purchase and sale decision based on fair value of such assets Such assetsare subsequently measured at fair value with unrealized gain and losses arising from changes in the fair valuebeing recognised in the Statement of Profit and Loss in the period in which they arise
Trade receivable Advances Security Deposits Cash and Cash equivalents etc are classified for measurementat amortised cost while Investment have been classified for measurement at Fair value through profit or loss(FVTPL)
Impairment The Company assesses at each reporting date whether a financial asset (or group of financialassets) such as investment trade receivable advances and security deposit held at amortised cost are tested forimpairment based on evidence or information that is available without undue cost or effort Expected credit lossesare assessed and loss allowances recognized if the credit quality of the financial asset has deteriorated significantlysince initial recognition
Reclassification When and only when the business model is changed the Company shall reclassify all affectedfinancial assets prospectively from the reclassification date as subsequently measured at amortised cost fairvalue through profit or loss without restating the previously recognized gains or losses and in terms of thereclassification principles laid down in the Ind AS relating to Financial Instruments
De-recognition Financial assets are derecognized when the rights to receive benefits have expired or beentransferred and the Company has transferred substantially all risks and rewards of ownership of such financialasset
Financial LiabilitiesTrade payables and other financial liabilities are initially recognized at the value of the respective contractualobligations They are subsequently measured at amortised cost
Financial liabilities are derecognized when the liability is extinguished that is when the contractual obligation isdischarged cancelled or expires
Offsetting Financial InstrumentsFinancial assets and liabilities are offset and the net amount is included in the Balance Sheet where there is alegally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis orrealise the asset and settle the liability simultaneously
Revenue1 Revenue is measured at the fair value of the consideration received or receivable for services rendered net of
discounts to customers and excludes taxes such as Goods and Services Tax Revenue from the sale ofservices is recognised when the Company performs its obligations to its customers and the amount of revenuecan be measured reliably and recovery of the consideration is probable Income from operating license fees arerecognized on accrual basis in accordance with Operating License agreement The timing of such revenuerecognition is in the periods in which such services are rendered
2 Interest Income is booked in the Statement of Profit and Loss using the effective interest method
3 Dividend Income is recognised in the Statement of Profit and Loss when the right to receive dividend is established
Employee BenefitsThe Company makes contributions to both defined benefit and defined contribution schemes
Contributions to Provident Fund are in the nature of defined contribution scheme and such paidpayable amountsare charged against revenue The contributions in respect of provident fund and family pension are statutorilydeposited with the Government
The Company also makes contribution to defined benefit gratuity plan The cost of providing benefits under thedefined benefit obligation is calculated by independent actuary using the projected unit credit method The Companyhas taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liability with respect to the
47
NOTES TO THE FINANCIAL STATEMENTS
employees and the premium paid to LIC is charged to Statement of Profit amp Loss The difference between theactuarial valuation of the gratuity with respect to employees at the year-end and the contribution paid to LIC isfurther adjusted in the books of accounts
Employees Benefit wrt Leave Encashment is considered as Employees Long Term Benefit for which the Companyrecords the liability based on actuarial valuation computed under projected unit credit method These benefits areunfunded
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee as per the Operating LicenseAgreement
Taxes on IncomeTaxes on income comprises of current tax and deferred tax Current tax in the Statement of Profit and Loss isprovided as the amount of tax payable in respect of taxable income for the period using tax rates and tax lawsenacted during the period together with any adjustment to tax payable in respect of previous years
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities andthe amounts used for taxation purposes (tax base) at the tax rates and tax laws enacted or substantively enactedby the end of the reporting period
Deferred tax assets are recognized for the future tax consequences to the extent it is probable that future taxableprofits will be available against which the deductible temporary differences can be utilized
Deferred tax assets and liabilities are offset when there is legally enforceable right to offset current tax assets andliabilities and when the deferred tax balances relate to the same taxation authority Current tax assets and taxliabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on netbasis or to realize the asset and settle the liability simultaneously
Dividend DistributionDividends paid (including income tax thereon) is recognised in the financial statements in the period in which inwhich the interim dividends are approved by the Board of Directors or in respect of the Companyrsquos final dividendfor the year when the same are approved by shareholders of the Company
Provisions and Contingent LiabilitiesProvisions are recognized when the Company has a present obligation (legal or constructive) as a result of a pastevent it is probable that an outflow of resources will be required to settle the obligation and the amount can bereliably estimated The amount so recognized is the best estimate of the consideration required to settle theobligation at the reporting date taking in to account the risks and uncertainties surrounding the obligation Adisclosure for a contingent liability is made when there is possible obligation or a present obligation that may butprobably will not require an outflow of resources Where there is possible obligation or a present obligation inrespect of which the likelihood of outflow of resources is remote no provision or disclosure is made
Use of Estimates and JudgementsThe key estimates and assumption used in the preparation of financial statements are set out below
Actuarial ValuationThe determination of Companyrsquos liability towards defined benefit obligation to employees is made through independentactuarial valuation including determination of amounts to be recognized in the Statement of Profit and Loss and inother comprehensive income Such valuation depend upon assumptions determined after taking into accountinflation seniority promotion and other relevant factors such as supply and demand factors in the employmentmarket Information about such valuation is provided in notes to the financial statements
ComparativesWhen required by Ind AS comparative figures have been adjusted to conform to changes in presentation for thecurrent financial year
48
2P
rope
rty
Pla
nt a
nd E
quip
men
tA
mou
nt i
n `
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
Gros
s Bl
ock
Depr
eciat
on
Amor
tisati
onNe
t Blo
ck
Parti
cula
rsWi
thdraw
alWi
thdraw
alWi
thdraw
alWi
thdraw
alAp
ril 1
and
Marc
h 31
an
dMa
rch
31
April
1Fo
r the
and
March
31
For t
hean
dMa
rch
31
Marc
h 31
Ma
rch
31
2017
Addi
tions
Adjus
tmen
t20
18Ad
ditio
nsAd
justm
ent
2019
2017
year
Adjus
tmen
t20
18ye
arAd
justm
ent
2019
2019
2018
Tang
ible
Ass
ets
Build
ing
161
88
565
-16
188
565
-2
668
831
592
168
29
561
564
759
84-1
432
140
473
636
290
5518
76
721
140
44
961
147
56
425
Plan
t and
Equ
ipmen
t7
637
0120
716
742
985
-2
047
935
381
92-
--
--
--
538
192
742
985
Furn
iture
and
Fixt
ures
1
278
845
584
122
300
-11
818
110
482
--
--
--
-1
104
821
223
00
Offic
e Eq
uipme
nt2
017
-2
017
--
201
7-
--
--
--
201
72
017
Tota
l1
708
216
7-
263
001
705
586
7-
483
494
165
72
373
956
156
475
984
-14
321
404
736
3629
055
187
672
11
469
565
21
562
372
7
Full
y de
prec
iated
ass
ets
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
49
NOTES TO THE FINANCIAL STATEMENTS
Amount in `Particulars As at 31st March 2019 As at 31st March 2018
Current Non-Current Current Non-Current3 OTHER ASSETS
Advances other than capital advancesSecurity Deposit- With Others 2328947 2328947- Statutory Authorities 200000Other Advances (prepaid expenses) 437564 ndash 406324 ndashAdvance Tax (Net of Provisions) 4143487 5280504TOTAL 437564 6672434 406324 7609451
4 Current investments (at fair value through profit or loss unless otherwise stated) Amount in `Sl Investments in Mutual Funds As at 31st March 2019 As at 31st March 2018No
Name of Plan Unquoted Unquoted1 DHFL Pramerica Ultra Short Term Fund Nil (2018 - 1040731248)
Units of ` 1000 each ndash 219455882 ICICI Prudential Banking amp PSU Debt Fund 1124750948 Units
(2018 - 1124750948) of ` 1000 each 23872614 224702743 ICICI Prudential Corporate Bond Fund 1241451718 Units
(2018 - 1241451718) of ` 1000 each 23712100 221226704 UTI Floating Rate Fund Short Term Fund 7749911 Units
(2018-7749911) of ` 100000 each 23474167 218899535 SBI Magnum Instacash Nil Units (2018-3177849) of ` 100000 each ndash 70220186 Aditya Birla Sun Life Floating Rate Fund-Long Term 274475933 Units
(2018-319824542) Units of ` 10000 each 63614941 686675207 Aditya Birla Sunlife Saving Fund 137924934 Units (2018-129174683)
Units of ` 10000 each 51171946 443649348 Kotak Savings Fund 1128273230 Units (2018-Nil) of ` 1000 each 33816154 ndash9 Reliance Liquid Fund 11416769 Units (2018- Nil) of ` 100000 each 51823115 ndash10 ICICI Prudential Liquid Fund 57413509 Units (2018- Nil) of ` 10000 each 8809857 ndash
Aggregate amount of unquoted Investments 280294894 208482957TOTAL 280294894 208482957
Amount in `As at As at
31st March 2019 31st March 20185 TRADE RECEIVABLES
Unsecured Considered Good 16310661 14154244TOTAL 16310661 14154244
6 CASH AND CASH EQUIVALENTS Balances with Banks
Current Accounts 760024 900355Cash on Hand 3015 ndashTOTAL 763039 900355 Cash and cash equivalents include cash on hand cheques drafts on hand cash at bank and deposits with banks with original maturityof 3 months or less
7 OTHER BANKS BALANCESEarmarked balances 5489856 5429140On Deposit Accounts ndash 47753491TOTAL 5489856 53182631
Represents deposits with original maturity of more than 3 months having remaining maturity of less than 12 months from the Balance Sheet date
50
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
8 OTHER FINANCIAL ASSETSInterest accrued on Deposits 158000 2210348Others - Unsecured considered good 4566316 4138776TOTAL 4724316 6349124
As at As at As at As at31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of ` (No of `
Shares) Shares)9 EQUITY SHARE CAPITAL
AuthorisedEquity Shares of ` 10- each 10000000 100000000 10000000 100000000Issued Subscribed and Paid upEquity Shares of ` 10- each fully paid 3787515 37875150 3787515 37875150
A) Reconciliation of the number of Equity Shares outstanding31st March 31st March
2019 2018As at the beginning of the year 3787515 3787515Add - Shares issued during the year ndash ndashLess -Shares bought back during the year ndash ndashAs at the end of the year 3787515 3787515
B) Shareholders holding more than 5 of the As at As at As at As atEquity Shares in the Company 31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of (No of
Shares) Shares)ITC Limited 1733907 4578 1733907 4578Russell Investments Limited 300056 792 300056 792
C) Rights Preferences and Restrictions attached to the Equity SharesThe Equity Shares of the Company having par value of ` 10 per share rank pari passu in all respects includingvoting rights and entitlement to dividend
D) There are no bonus issue or buy back of equity shares during the period of five years immediately preceding thereporting date
As at 31st March 2019 As at 31st March 2018Current Non-Current Current Non-Current
10 PROVISIONSProvision for Long Term Employee Benefits 74301 1399224 43165 1270990TOTAL 74301 1399224 43165 1270990
51
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
11 DEFERRED TAX LIABILITIES (NET)Deferred Tax Liabilities 10745247 11364002Total 10745247 11364002Movement in Deferred Tax LiabilitiesAssets Balances
For the year 2018-19 Balance as on Recognized in Balance as on1st April 2018 profit or loss 31st March 2019
Deferred Tax Liabilities in relation toOther timing differences
On Depreciation on PPE 4293876 (252926) 4040950On Gain on Investment at FVTPL 7070126 473819 7543945
Total Deferred Tax Liabilities 11364002 220893 11584895Deferred tax liabilities beforeMAT credit entitlement 11364002 220893 11584895Less MAT credit entitlement ndash 839648 839648Total Deferred Tax Liabilities (Net) 11364002 (618755) 10745247
For the year 2017-18 Balance as on Recognized in Balance as on1st April 2017 profit or loss 31st March 2018
Deferred Tax liabilitiesassets in relation toOther timing differences
On Depreciation on PPE 4383618 (89742) 4293876On Gain on Investment at FVTPL 4629882 2440244 7070126
Total Deferred Tax Liabilities (Net) 9013500 2350502 11364002
As at As at31st March 2019 31st March 2018
12 OTHER FINANCIAL LIABILITIES
Unpaid Dividend 5489856 5429140Employee Related 3782488 5688986TOTAL 9272344 11118126
13 OTHER CURRENT LIABILITIES
Statutory Liabilities 1264039 1172866TOTAL 1264039 1172866
52
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 201814 REVENUE FROM OPERATIONS
Operating License Fees 36986948 33098499TOTAL 36986948 33098499
15 OTHER INCOMEInterest Income- Deposit with Banks- Carried At Amortised Cost 1178600 3272160- Deposit Others 139222 181790Dividend Income on Investment measured at FVTPL 159984 178075Net Gain(Loss) on financial assets mandatorily measured at FVTPL 18005340 13358789Net Gain(Loss) on Disposal of Fixed Assets ndash 28273Other Non-Operating Income 142398 100022TOTAL 19625544 17119109
Includes 1120976- (2018 - 681882-) being net gain(loss) on sale of investments
16 EMPLOYEE BENEFITS EXPENSESalaries and Wages 42461991 38590070Contribution to Provident and Other Fund 4564892 3983444
47026883 42573514Less Recoveries madeReimbursements received (45818303) (41478905)TOTAL 1208580 1094609
17 OTHER EXPENSESAdvertising Sales Promotion 159768 158814Consultancy Professional fees 214842 253969Travelling amp Conveyance 810746 1096527Postage Telephone Stationery etc 366042 205049Miscellaneous Expenses 1556515 1619728TOTAL 3107913 3334087Miscellaneous expenses includes Auditors remuneration andexpenses Audit Fees 60000 60000Fees for other services 40000 ndash
18 INCOME TAX EXPENSESA Amount recognised in profit or loss
Current TaxIncome Tax for the Year 11504441 9481109Adjustments(Credits) related to previous year 149058 (208799)Total Current Tax 11653499 9272310Deferred TaxDeferred tax for the year 220893 2350502Mat Credit Entitlement (839648) ndashTotal Deferred Tax (618755) 2350502TOTAL 11034744 11622812
NOTES TO THE FINANCIAL STATEMENTSAmount in `
53
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 2018B Reconciliation of effective tax rate
Profit before tax 51822363 45312928Indian tax rate 2782 2755Income Tax expense calculated at 2782 (2018 2755) 14416981 12484845Effects ofndash Different tax rate on certain items (2922098) (756048)ndash Difference in taxable incomedeductible expense 9697 42609ndash Incomes that are not taxable in determining taxable profit (44508) (49064)Adjustments recognised in the current year in relation toCurrent tax of prior years (425328) (208799)Effect on deferred tax balances due to the change in income tax rate ndash 109269Income Tax recognised in profit or loss 11034744 11622812
The tax rate used for the year 2018-19 and 2017-18 reconciliations above is the corporate tax rate of 25 + surcharge 7 and education cess 4 (2017-18 3) payable on taxable profits under the Income Tax Act 1961
19 EARNINGS PER EQUITY SHAREProfit for the year 40787619 33690116Number of equity shares outstanding 3787515 3787515Basic and diluted earnings per share in (Face value ` 10- per share) 1077 890
20 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTSA The Company was allotted 8200 sq mtrs of land at Vadodara in 1984 and an additional land of 2548 sq mtrs
in 1988 at R C Dutt Road Alkapuri Vadodara through GIIC (Gujarat Industrial Investment Corporation) on sub-lease for a period 30 years on which the hotel Welcomhotel Vadodara was constructed Lease term of landadmeasuring 8200 Sq mtrs expired on 30092014 and of land admeasuring 2548 sq mtrs expired on 30112018
The High Court of Gujarat in pursuance of Writ petition filed by Company in April 2013 passed an Order onDecember 24 2014 restraining the State Government from disturbing the peaceful and actual possession ofthe Company over the hotel property in any manner The writ petition is pending for hearing
The Company have made necessary application to State Government for Conversion of land from Leasehold toFreehold or Extension of Lease which is in process
B There are no Micro Small and Medium Enterprises to whom the Company owes dues which are outstandingfor more than 45 days during the year and also as at 31st March 2019 This information as required to bedisclosed under the Micro Small and Medium Enterprises Development Act 2006 has been determined tothe extent such parties have been identified on the basis of information available with the Company
C The Company operates in one segment ie Hoteliering and within one geographical segment ie India
D Defined Benefit Plan
The Company has taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liabilitywith respect to the employees and the premium paid to LIC is charged to Statement of Profit amp Loss Thedifference between the actuarial valuation of the gratuity with respect to employees at the year-end and thecontribution paid to LIC is further adjusted in the books of accounts
The accounting charge for benefits under the defined benefit obligation is calculated by independent actuaryusing the projected unit credit method
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee (ITC Limited) as per theOperating License Agreement hence no effect on Statement of Profit amp Loss and Other Comprehensive
54
NOTES TO THE FINANCIAL STATEMENTS
Income
Risk ManagementThe defined Benefit Plan expose the company to risk of actuarial deficit arising out of investment risk interestrate risk and salary cost inflation riskInvestment Risks This may arise from volatility in asset values due to market fluctuations and impairment ofassets due to credit losses These Plans primarily invest in debt instruments such as Government securitiesand highly rated corporate bonds ndash the valuation of which is inversely proportional to the interest rate movementsInterest Rate Risk The present value of Defined Benefit Plans liability is determined using the discount ratebased on the market yields prevailing at the end of reporting period on Government bonds A decrease inyields will increase the fund liabilities and vice-versaSalary Cost Inflation Risk The present value of the Defined Benefit Plan liability is calculated with referenceto the future salaries of participants under the Plan Increase in salary due to adverse inflationary pressuresmight lead to higher liabilitiesThese Plans have a relatively balanced mix of investments in order to manage the above risks The investmentstrategy is designed based on the interest rate scenario liquidity needs of the Plans and pattern of investmentas prescribed under various statutes
(Amount in `) Particulars Gratuity 2018-19 2017-18
I Components of Defined Benefit Cost 31-03-2019 31-03-2018 Recognised in Profit or Loss a Current Service Cost 641829 519816 b Past Service Cost ndash
c Net Interest Cost (184109) (72060) Remeasurements a Effect of changes in demographic assumptions (2108) ndash b Effect of changes in financial assumptions ndash (546692) c Effect of experience adjustments (142950) (700483) d (Return) on plan assets (excluding interest income) 24103 110903 e Changes in asset ceiling (excluding interest income) ndash ndash f Total remeasurements included in OCI (169160) (1358078)
Total defined benefit cost recognized in PampL 288560 (910323)I I Net Assets (Liabilities) recognised in Balance Sheet 31-03-2019 31-03-2018
1 Defined Benefit Obligation at end of period 11112243 102978642 Fair value of plan assets at end of period 13058222 120087733 Net defined benefit liability (asset) (1945979) (1710909)
III Change in Defined Benefit Obligation 31-03-2019 31-03-20181 Defined benefit obligation at beginning of period 10297864 111006822 Current service cost 641829 5198163 Interest expenses 755904 7223694 Remeasurements gains (losses)
a Effect of changes in demographic assumptions (2108) ndashb Effect of changes in financial assumptions ndash (546692)c Effect of experience adjustments (142950) (700483)
5 Benefits Paid (438296) (797828)6 Present Value of DBO at end of the year 11112243 10297864
IV Change in Fair Value of Plan Assets 31-03-2019 31-03-20181 Fair value of plan assets at beginning of period 12008773 11529880
55
NOTES TO THE FINANCIAL STATEMENTS
2 Interest income 940012 7944303 Actual Company Contributions 523630 3713884 Benefits Paid (438296) (797828)5 Remeasurements Gains(Losses) on plan assets 24103 1109036 Fair Value of Plan Assets at end of period 13058222 12008773
V Significant Actuarial Assumptions 31-03-2019 31-03-20181 Discount rate () 750 7502 Salary increase rate 70 703 Attrition Rate 20 204 Retirement Age 58 585 Pre-retirement Mortality Indian Assured Indian Assured
Lives Mortality Lives Mortality(2012-14) Ultimate (2006-08) Ultimate
6 Disability Nil NilVI Sensitivity Analysis
The below sensitivity analysis are based on a change in an assumption while holding all other assumptionsconstant In practice this is unlikely to occur and changes in some of the assumptions may be correlatedWhen calculating the sensitivity of the defined benefit obligation to significant actuarial assumptionsthe same method (present value of the defined benefit obligation calculated with the projected unit creditmethod at the end of the reporting period) has been applied as when calculating the defined benefitliability recognised in the balance sheet The methods and types of assumptions used in preparing thesensitivity analysis did not change compared to the prior period
DBO as at DBO as at31-03-2019 31-03-2018
1 Discount rate +100 basis points 10484869 96707062 Discount rate -100 basis points 11804923 109908143 Salary Increase Rate +1 11746789 109364544 Salary Increase Rate -1 10525722 97077345 Attrition Rate +1 11127835 103179616 Attrition Rate -1 11095064 10276102
Maturity Analysis of the Benefit Payments 31-03-2019 31-03-2018 Year 1 804294 399061 Year 2 1117591 769443 Year 3 558914 1211853 Year 4 2204073 512504 Year 5 1303903 2056016 Next 5 years 4323660 4603103
E Amount towards Defined Contribution Plans have been recognized under Contribution to Provident and OtherFunds in Note 16 ` 4564892- (2018 - ` 3983444-)
F The financial statements were approved for issue by the Board of Directors on 15th April 2019G Company has adopted IND As 115 lsquoRevenue from Contracts with Customersrsquo wef 01st April 2018 on prospective
basis and there is no material impact on Financial StatementsH Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Second
Amendment Rules 2019 on 30th March 2019 notifying new Standard Ind AS 116 lsquoLeasesrsquo and otherconsequential amendment in existing Ind As This Ind AS is applicable for annual period beginning on or after01st April 2019 The company is in the process of analysing the impact of such amendment which are notexpected to be material
56
NOTES TO THE FINANCIAL STATEMENTS
21 Financial Instruments and Related DisclosuresI Capital Management
The Company does not have borrowing and aims at maintaining a strong capital base so as to maintain adequatesupply of funds towards future growth plans as a going concern
II Categories of Financial InstrumentsAmount in `
Particulars Note As at As at March 31 2019 March 31 2018
Carrying Fair Carrying FairValue Value Value Value
A Financial Assetsa) Measured at Amortised Cost
i) Cash and cash equivalents 6 763039 763039 900355 900355ii) Other bank balances 7 5489856 5489856 53182631 53182631iii) Trade Receivables 5 16310661 16310661 14154244 14154244iv) Other Financial Assets 8 4724316 4724316 6349124 6349124
Sub - total 27287872 27287872 74586354 74586354 b) Measured at Fair Value through Profit or Loss
i) Investment in mutual funds 4 280294894 280294894 208482957 208482957Sub - total 280294894 280294894 208482957 208482957
Total Financial Assets 307582766 307582766 283069311 283069311B Financial Liabilities
Measured at Amortised Costi) Trade Payables 483074 483074 395920 395920ii) Other Financial Liabilities 12 9272344 9272344 11118126 11118126Total Financial Liabilities 9755418 9755418 11514046 11514046
The carrying amounts of trade payables other financial liabilities cash and cash equivalents other bank balancestrade receivables and other financial assets are considered to be the same as their fair values due to their short termnatureFair value in Mutual fund has been considered as Level 1 as Hierarchy for the same are based on unadjusted pricesin active marketIII Financial Risk Management Objectives
The Company has a system-based approach to risk management anchored to policies and procedures andinternal financial controls aimed at ensuring early identification evaluation and management of key financialrisks (such as market risk credit risk and liquidity risk) that may arise as a consequence of its businessoperations as well as its investing activities Accordingly the Companyrsquos risk management framework has theobjective of ensuring that such risks are managed within acceptable and approved risk parameters in a disciplinedand consistent manner and in compliance with applicable regulation It also seeks to drive accountability in thisregardLiquidity RiskThe company has current assets aggregate to ` 308020330- (2018- ` 283475635) including CurrentInvestments Cash and cash equivalents and Other bank balances of ` 286547789- (2018- ` 262565943-)against an aggregate Current liability of ` 11093758- (2018- ` 12730077-) on the reporting dateFurther whilethe Companyrsquos total equity stands at ` 306150187- (2018- ` 281343744-) and it has no borrowings In suchcircumstances liquidity risk or the risk that the company may not be able to settle or meet its obligations as theybecome due does not existMarket RiskThe company invests in mutual fund schemes of leading fund houses Such investments are susceptible tomarket price risk that arise mainly from changes in interest rate which may impact the return and value of such
57
NOTES TO THE FINANCIAL STATEMENTS
investments However given the relatively short tenure of the underlying portfolio of the mutual fund schemes inwhich the company has invested such price risk is not significantCredit RiskCompanyrsquos deployment in financial instruments such as mutual funds and fixed deposit are made in high qualitypaperscounterparties The company has receivable balances with ITC Limited under the Operating ServiceAgreement which are generally short term in nature Accordingly the Company has concluded that no provisionfor expected credit loss is required
22 Related Party DisclosuresRelated Party Transactionsi) Name of related parties and nature of relationships
ITC Limited of which the Company is an Associateii) Key Management Personnel
Board of DirectorsN Anand Chairman amp Non-Executive DirectorJ Singh Non-Executive DirectorR C Mehta Non-Executive DirectorC K Koshy Non-Executive DirectorM Narayanan Non-Executive DirectorD R Choudhury Non-Executive Director
iii) Summary of transactions during the year Amount in `
Particulars ITC Limited Key ManagementPersonnel
2019 2018 2019 2018License Fees Received 43644599 38834172 ndash ndashPurchase of Services 364514 513635 ndash ndashRemuneration of Managers on Deputation Reimbursed 5916468 5236397 ndash ndashRecoveries of Contractual Remuneration(Including Mangers on Deputation) 53058539 51502148 ndash ndashExpenses Recovered 2168155 2400471 ndash ndashExpenses Reimbursed ndash 44604 ndash ndashDividend Payments 6068675 6068675 700 700Remuneration to Key Management Personnel- Directorrsquos Sitting Fees 370000 350000Balance amount recoverable 20865894 18292750 ndash ndashBalance amount payable ndash ndash ndash ndash
58
TO THE MEMBERS OFGUJARAT HOTELS LIMITED
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying financial statementsof Gujarat Hotels Limited (ldquothe Companyrdquo) which comprisethe Balance Sheet as at 31st March 2019 the Statement ofProfit and Loss including other comprehensive incomeStatement of Changes in Equity and Statement of CashFlows for the year then ended and notes to the financialstatements including a summary of significant accountingpolicies and other explanatory information (hereinafterreferred to as ldquothe financial statementsrdquo)
In our opinion and to the best of our information andaccording to the explanations given to us the aforesaidfinancial statements give the information required by theCompanies Act 2013 (ldquothe Actrdquo) in the manner so requiredand give a true and fair view in conformity with the IndianAccounting Standards specified under section 133 of theAct read with the Companies (Indian Accounting Standards)Rules 2015 as amended (lsquoInd ASrdquo) and other accountingprinciples generally accepted in India of the state of affairsof the Company as at 31 st March 2019 and totalcomprehensive income (comprising of profit and othercomprehensive income) changes in equity and its cashflows for the year ended on that date
Basis for Opinion
We conducted our audit of the financial statements inaccordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act Our responsibilities underthose Standards are further described in the AuditorrsquosResponsibilities for the Audit of the Financial Statementssection of our report We are independent of the Companyin accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financialstatements under the provisions of the Act and the Rulesmade thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements andthe Code of Ethics We believe that the audit evidence wehave obtained is sufficient and appropriate to provide abasis for our audit opinion
Key Audit Matters
Key audit matters are those matters that in our professionaljudgment were of most significance in our audit of thesefinancial statements of the current period These matterswere addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereonand we do not provide a separate opinion on these mattersWe have determined the matters described below to bethe key audit matters to be communicated in our report
INDEPENDENT AUDITORS REPORT
Information Other than the Financial Statements andAuditorrsquos Report Thereon
The Companyrsquos Board of Directors is responsible forpreparation of the other information The other informationcomprises the information included in the Boardrsquos Reportincluding Annexures to Boardrsquos Report ManagementDiscussion and Analysis Report on Corporate Governance
and Shareholderrsquos Information but does not include thefinancial statements and our auditorrsquos report thereon
Our opinion on the financial statements does not cover theother information and we do not express any form ofassurance conclusion thereon
In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing
Sr No
Key Audit Matter How our audit addressed the matter
1 Evaluation of uncertain legal position of leasehold land
(Refer note no 20A to the financial statements)
The lease period of land held by the Company has expired The Company has filed necessary writ petition with High Court of Gujarat in April 2013 which is still pending for adjudication The Company has also made necessary application to State Government for Conversion of land from Leasehold to Freehold or Extension of Lease which is in process This matter being sub-judice essentially involves significant judgement to determine the possible outcome and therefore we have considered it as a key audit matter
We performed the following substantive procedures
Obtained details of application made to State Government Obtained details of writ petition filed to the High Court of
Gujarat and order copy passed by the High Court of Gujarat restraining the State Government from disturbing the actual possession over the property
Obtained details of progress in the matter Discussed the case with the Companyrsquos legal advisor about
the possible outcomes Read the minutes of the board meetings
Based on the procedures described managementrsquos evaluation on the same is acceptable
59
so consider whether the other information is materiallyinconsistent with the financial statements or our knowledgeobtained in the audit or otherwise appears to be materiallymisstated
If based on the work we have performed we conclude thatthere is a material misstatement of this other informationwe are required to report that fact We have nothing to reportin this regard
Responsibilities of Management and Those Charged withGovernance for the Financial Statements
The Companyrsquos Board of Directors is responsible for thematters stated in section 134(5) of the Act with respect tothe preparation of these financial statements that give atrue and fair view of the financial position financialperformance including other comprehensive incomechanges in equity and cash flows of the Company inaccordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards(Ind AS) prescribed under section 133 of the Act
This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company andfor preventing and detecting frauds and other irregularitiesselection and application of appropriate accounting policies making judgments and estimates that are reasonableand prudent and design implementation andmaintenance of adequate internal financial controls thatwere operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to thepreparation and presentation of the financial statementsthat give a true and fair view and are free from materialmisstatement whether due to fraud or error
In preparing the financial statements management isresponsible for assessing the Companyrsquos ability tocontinue as a going concern disclosing as applicablematters related to going concern and using the goingconcern basis of accounting unless management eitherintends to liquidate the Company or to cease operationsor has no realistic alternative but to do so
The Board of Directors is also responsible for overseeingthe Companyrsquos financial reporting process
Auditorrsquos Responsibilities for the Audit of the FinancialStatements
Our objectives are to obtain reasonable assurance aboutwhether the financial statements as a whole are free frommaterial misstatement whether due to fraud or error andto issue an auditorrsquos report that includes our opinionReasonable assurance is a high level of assurance but isnot a guarantee that an audit conducted in accordance withSAs will always detect a material misstatement when itexists Misstatements can arise from fraud or error and areconsidered material if individually or in the aggregate they
could reasonably be expected to influence the economicdecisions of users taken on the basis of these financialstatements
As part of an audit in accordance with SAs we exerciseprofessional judgment and maintain professionalskepticism throughout the audit We also
bull Identify and assess the risks of materialmisstatement of the financial statements whetherdue to fraud or error design and perform auditprocedures responsive to those risks and obtain auditevidence that is sufficient and appropriate to providea basis for our opinion The risk of not detecting amaterial misstatement resulting from fraud is higherthan for one resulting from error as fraud may involvecollusion forgery intentional omissionsmisrepresentations or the override of internal control
bull Obtain an understanding of internal control relevantto the audit in order to design audit procedures thatare appropriate in the circumstances Under section143(3)(i) of the Act we are also responsible forexpressing our opinion on whether the Company hasadequate internal financial controls system in placeand the operating effectiveness of such controls
bull Evaluate the appropriateness of accounting policiesused and the reasonableness of accountingestimates and related disclosures made bymanagement
bull Conclude on the appropriateness of managementrsquosuse of the going concern basis of accounting andbased on the audit evidence obtained whether amaterial uncertainty exists related to events orconditions that may cast significant doubt on theCompanyrsquos ability to continue as a going concern Ifwe conclude that a material uncertainty exists we arerequired to draw attention in our auditorrsquos report tothe related disclosures in the financial statementsor if such disclosures are inadequate to modify ouropinion Our conclusions are based on the auditevidence obtained up to the date of our auditorrsquosreport However future events or conditions maycause the Company to cease to continue as a goingconcern
bull Evaluate the overall presentation structure andcontent of the financial statements including thedisclosures and whether the financial statementsrepresent the underlying transactions and events ina manner that achieves fair presentation
We communicate with those charged with governanceregarding among other matters the planned scope andtiming of the audit and significant audit findings includingany significant deficiencies in internal control that weidentify during our audit
INDEPENDENT AUDITORS REPORT
60
We also provide those charged with governance with astatement that we have complied with relevant ethicalrequirements regarding independence and tocommunicate with them all relationships and other mattersthat may reasonably be thought to bear on ourindependence and where applicable related safeguards
From the matters communicated with those charged withgovernance we determine those matters that were of mostsignificance in the audit of the financial statements of thecurrent year and are therefore the key audit matters Wedescribe these matters in our auditorrsquos report unless lawor regulation precludes public disclosure about the mattersor when in extremely rare circumstances we determinethat a matters should not be communicated in our reportbecause the adverse consequences of doing so wouldreasonably be expected to outweigh the public interestbenefits of such communication
Report on Other Legal and Regulatory Requirements
1 As required by the Companies (Auditorrsquos Report)Order 2016 (ldquothe Orderrdquo) issued by the CentralGovernment of India in terms of sub-section (11) ofsection 143 of the Act we give in ldquoAnnexure Ardquo astatement on the matters specified in paragraphs 3and 4 of the Order to the extent applicable
2 As required by Section 143(3) of the Act we reportthat
a we have sought and obtained all the information andexplanations which to the best of our knowledge andbelief were necessary for the purposes of our audit
b in our opinion proper books of account as requiredby law have been kept by the Company so far as itappears from our examination of those books
c the Balance Sheet the Statement of Profit and lossincluding other comprehensive income the Statementof Changes in Equity and the Statement of Cash Flowsdealt with by this Report are in agreement with thebooks of account
d in our opinion the aforesaid financial statementscomply with the Indian Accounting Standards (Ind AS)prescribed under Section 133 of the Act
e on the basis of the written representations receivedfrom the directors as on 31st March 2019 taken onrecord by the Board of Directors none of the directorsis disqualified as on 31st March 2019 from beingappointed as a director in terms of Section 164(2) ofthe Act
f with respect to the adequacy of the internal financialcontrols with reference to financial statements of theCompany and the operating effectiveness of suchcontrols refer to our separate report in ldquoAnnexure Brdquoand
g with respect to the other matters to be included in theAuditorrsquos Report in accordance with the requirementsof section 197(16) of the Act as amended theCompany has neither paid nor provided for anyremuneration to its directors during the year
h with respect to the other matters to be included in theAuditorrsquos Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules 2014 in ouropinion and to the best of our information andaccording to the explanations given to us
i the Company does not have any pendinglitigations which would impact its financialposition
ii the Company did not have any long-termcontracts including derivative contracts for whichthere were any material foreseeable losses
iii there has been no delay in transferringamounts required to be transferred to theInvestor Education and Protection Fund by theCompany
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
61
ANNEXURE A TO THE INDEPENDENT AUDITORrsquoS REPORT
The annexure referred to in our Independent AuditorrsquosReport to the members of Gujarat Hotels Limited (ldquotheCompanyrdquo) on the financial statements for the year ended31st March 2019 we report that
i (a) The Company has maintained proper recordsshowing full particulars including quantitativedetails and situation of fixed assets
(b) As explained to us the Company has a regularprogram of physical verification of fixed assetswhich in our opinion is reasonable The assetswhich were to be covered as per the saidprogram have been physically verified by themanagement during the year In our opinion andAccording to the information and explanationsgiven to us no material discrepancies werenoticed on such verification
(c) According to the information and explanationsgiven to us and on the basis of our examinationof the records of the Company the title deeds ofimmovable properties are held in the name ofthe Company with respect to land the Companyhas filed a writ petition with Gujarat High Courtseeking that the Gujarat State Government bedirected to take action on Companyrsquosapplication to have the leasehold land of theHotel Converted to freehold and transferred toCompany as per the existing government policyin this regard
ii The Company does not have any inventory andtherefore reporting under clause (ii) of the Order isnot applicable to the Company
iii The Company has not granted any loans secured orunsecured to Companies firms Limited LiabilityPartnerships or other parties covered in the registermaintained under section 189 of the Companies Act2013 and therefore reporting under clause (iii) of theOrder is not applicable to the Company
iv The Company has not given any loans guaranteesor security In respect of the Investments made in ouropinion and according to the information andexplanations given to us the Company has compliedwith the provisions of section 186 of the Act
v According to the information and explanations givento us the Company has not accepted any depositsduring the year from the public within the meaning ofprovisions of section 73 to 76 of the Companies Act2013 and the rules framed thereunder and thereforereporting under clause (v) of the Order is notapplicable to the Company
vi In our opinion and according to the information andexplanations given to us in view of Rule 3 of theCompanies (Cost Records and Audit) AmendmentsRules 2014 the maintenance of cost records undersub-section (1) of section 148 of the Companies Act2013 is not applicable to the Company and thereforereporting under clause (vi) of the Order is notapplicable to the Company
vii (a) According to the information and explanationsgiven to us the Company has been regular indepositing with appropriate authoritiesundisputed statutory dues including providentfund employeersquos state insurance income-taxvalue added tax goods and service tax cessand other statutory dues applicable to it Furtherno undisputed amounts payable in respect ofprovident fund employeersquos state insuranceincome tax value added tax goods and servicetax cess and any other statutory dues were inarrears as at 31st March 2019 for a period ofmore than six months from the date theybecome payable
(b) According to the information and explanationsgiven to us there are no dues of Income taxsales tax value added tax and goods andservice tax which have not been deposited onaccount of any dispute
viii The Company has not taken any loans or borrowingsfrom financial institutions banks and government orhas not issued any debentures and thereforereporting under clause (viii) of the Order is notapplicable to the Company
ix The Company has not raised moneys by way of initialpublic offer or further public offer (including debtinstrument) and term loans during the year andtherefore reporting under clause (ix) of the Order isnot applicable to the Company
x To the best of our knowledge and according toinformation and explanations given to us no materialfraud by the Company or on the Company by its officersor employees has been noticed or reported duringthe course of our audit
xi In our opinion and according to the information andexplanations given to us the Company has not paidor provided any managerial remuneration during theyear and therefore reporting under clause (xi) of theOrder is not applicable to the Company
xii The Company is not a Nidhi company and thereforereporting under clause (xii) of the Order is notapplicable to the Company
INDEPENDENT AUDITORS REPORT
62
xiii In our opinion and according to the information andexplanations given to us and based on ourexamination of the records of the Company alltransactions with the related parties are in compliancewith Section 177 and 188 of the Act where applicableand the details have been disclosed in the financialstatements as required by the applicable accountingstandards
xiv According to the information and explanations givento us the Company has not made any preferentialallotment or private placement of shares or fully orpartly convertible debentures during the year underreview and therefore reporting under clause (xiv) ofthe Order is not applicable to the Company
xv In our opinion and according to the information andexplanations given to us the Company has not
entered into any non-cash transactions with directorsor persons connected with directors and thereforereporting under clause (xv) of the Order is notapplicable to the Company
xvi The Company is not required to be registered undersection 45-IA of the Reserve Bank of India Act 1934
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
63
ANNEXURE ldquoBrdquo TO THE INDEPENDENT AUDITORSrsquo REPORT
(Referred to in paragraph 2(f) under lsquoReport on Other Legaland Regulatory Requirementsrsquo section of our report to theMembers of Gujarat Hotels Limited on the financialstatements of even date)
Report on the Internal Financial Controls with referenceto financial statements under Clause (i) of Sub-section 3of Section 143 of the Act
W e have audited the internal financial controls withreference to financial statements of Gujarat Hotels Limited(ldquothe Companyrdquo) as of 31st March 2019 in conjunction withour audit of the financial statements of the Company for theyear ended on that date
Managementrsquos Responsibility for Internal FinancialControls
The Companyrsquos management is responsible forestablishing and maintaining internal financial controlsbased on the internal control over financial reporting criteriaestablished by the Company considering the essentialcomponents of internal control stated in the Guidance Noteon Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountantsof India (ldquoICAIrdquo) These responsibilities include the designimplementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuringthe orderly and efficient conduct of its business includingadherence to companyrsquos policies the safeguarding of itsassets the prevention and detection of frauds and errorsthe accuracy and completeness of the accounting recordsand the timely preparation of reliable financial informationas required under the Act
Auditorsrsquo Responsibility
Our responsibility is to express an opinion on theCompanyrsquos internal financial controls with reference tofinancial statements based on our audit We conductedour audit in accordance with the Guidance Note on Audit ofInternal Financial Controls over Financial Reporting (theldquoGuidance noterdquo) and the Standards on Auditing issued byICAI and deemed to be prescribed under section 143(10)of the Companies Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the ICAIThose Standards and the Guidance Note require that wecomply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whetheradequate internal financial controls with reference tofinancial statements were established and maintained andif such controls operated effectively in all material respects
Our audit involves performing procedures to obtain auditevidence about the adequacy of the internal financialcontrols with reference to financial statements and their
operating effectiveness Our audit of internal financialcontrols with reference to financial statements includedobtaining an understanding of internal financial controlswith reference to financial statements assessing the riskthat a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal controlbased on the assessed risk The procedures selecteddepend on the auditorrsquos judgement including theassessment of the risks of material misstatement of thefinancial statements whether due to fraud or error
We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our auditopinion on the Companyrsquos internal financial controls withreference to financial statements
Meaning of Internal Financial Controls with reference tofinancial statements
A Companyrsquos internal financial controls with reference tofinancial statements is a process designed to providereasonable assurance regarding the reliability of financialreporting and the preparation of financial statements forexternal purposes in accordance with generally acceptedaccounting principles A Companyrsquos internal financialcontrols with reference to financial statements includesthose policies and procedures that (1) pertain to themaintenance of records that in reasonable detailaccurately and fairly reflect the transactions anddispositions of the assets of the Company (2) providereasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements inaccordance with generally accepted accounting principlesand that receipts and expenditures of the Company arebeing made only in accordance with authorisations ofmanagement and directors of the Company and (3) providereasonable assurance regarding prevention or timelydetection of unauthorised acquisition use or dispositionof the Companyrsquos assets that could have a material effecton the financial statements
Inherent Limitations of Internal Financial Controls withreference to financial statements
Because of the inherent limitations of internal financialcontrols with reference to financial statements includingthe possibility of collusion or improper managementoverride of controls material misstatements due to erroror fraud may occur and not be detected Also projections ofany evaluation of the internal financial controls withreference to financial statements to future periods aresubject to the risk that the internal financial control withreference to financial statements may become inadequatebecause of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate
INDEPENDENT AUDITORS REPORT
64
Opinion
In our opinion the Company has in all material respectsan adequate internal financial controls with reference tofinancial statements and such internal financial controlswith reference to financial statements were operatingeffectively as at 31st March 2019 based on the internalcontrol over financial reporting criteria established by theCompany considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal
INDEPENDENT AUDITORS REPORT
Financial Controls over Financial Reporting issued by theInstitute of Chartered Accountants of India
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
6
Mr Rakesh Dalvi at telephone no 18002005533(toll free) You may also address your queries grievances relating to remote e-voting or votingat the meeting to Mr M Agarwal ComplianceOfficer at e-mail ID ghlinvestorsyahoocoin orat telephone no 0265 233 0033
XXI Those who become Members of the Companyafter despatch of the Notice but on or before31st August 2019 (cut-off date) may follow thesteps from Sl Nos II to XIX mentioned above forcasting of vote
XXII General Information
(a) There will be one vote for every Client ID NoRegistered Folio No irrespective of thenumber of joint holders
(b) The Results of voting will be declaredwithin 48 hours from the conclusion of theAGM and the Resolutions will be deemedto be passed on the date of the AGMsubject to receipt of requisite number ofvotes The declared Results along with theScrutinizerrsquos Report will be availableforthwith on the Companyrsquos websitewwwgujarathotelsltdin under the sectionlsquoInvestor Relationsrsquo and on the website ofCDSL such Results will also be forwardedto BSE Limited where the Companyrsquosshares are listed
EXPLANATORY STATEMENT
Annexed to the Notice convening the Thirty Seventh AnnualGeneral Meeting to be held on Saturday 7th September2019
Item No 5
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 28th June 2019 on the recommendationof the Nominations and Remuneration Committee(lsquothe Committeersquo) approved the appointment of Mr MohanSwarup Bhatnagar as Additional Director with effect from28th June 2019 and subject to the approval of the Membersalso as Independent Director of the Company for a periodof five years with effect from the said date in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquotheActrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquothe Listing Regulations2015rsquo)
Mr Bhatnagar (67) is a Science Graduate from St StephenrsquosCollege University of Delhi and is an MBA from the Facultyof Management Studies University of Delhi
Mr Bhatnagar joined ITC Limited (ITC) in 1975 in the HotelsDivision He held various job positions in Finance beforetaking over as the Head of Finance in 1997 withresponsibility for Treasury Audit Purchasing MaterialManagement and Information Technology Subsequentlyhe held charge of Growth and Development for the HotelsBusiness as Executive Vice President He was a memberof the Management Committee of the Division and was onthe Boards of Joint Venture and Subsidiary companies ofITC He retired from ITC in September 2013 Currently heis actively involved in angel investing and in mentoringselect start-up ventures
The Committee and the Board are of the view that theassociation of Mr Bhatnagar and the rich experience hebrings with him would benefit the Company Declarationhas been received from Mr Bhatnagar that he meets thecriteria of Independence prescribed under Section 149 ofthe Act read with the Companies (Appointment andQualification of Directors) Rules 2014 and Regulation 16of the Listing Regulations 2015 In the opinion of your BoardMr Bhatnagar fulfils the conditions specified in the Act theRules thereunder and the Listing Regulations 2015 forappointment as an Independent Director and he isindependent of the management of the CompanyMr Bhatnagar will be entitled to sitting fees for attending themeetings of the Board and its Committees
Requisite Notice under Section 160 of the Act proposingthe appointment of Mr Bhatnagar has been received by theCompany and consent has been filled by Mr Bhatnagarpursuant to Section 152 of the Act
Mr Bhatnagar holds 2500 shares in the Company
Mr Bhatnagar and his relatives are interested in thisResolution None of the other Directors and Key ManagerialPersonnel of the Company or their relatives is interestedin this Resolution
The Board recommends this Resolution for your approval
Item Nos 6 amp 7
The Members of the Company at the Thirty Second AnnualGeneral Meeting held on 29th September 2014 approvedthe appointment of Mr Koshy and Mr M Narayanan asIndependent Directors of the Company for a period of fiveyears with effect from the said date Mr Koshy andMr Narayanan will complete their respective terms on28th September 2019
The Board of Directors of the Company (lsquothe Boardrsquo) at themeeting held on 15th April 2019 on the recommendationof the Nominations and Remuneration Committee (lsquotheCommitteersquo) recommended for the approval of theMembers the re-appointment of Mr Koshy andMr Narayanan as Independent Directors of the Companywith effect from 29th September 2019 in terms of Section149 read with Schedule IV of the Companies Act 2013 (lsquothe
7
Actrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquoListing Regulations2015rsquo) as set out in the Resolutions relating to theirrespective re-appointment
The Committee and the Board are of the view that giventhe knowledge experience and performance of Mr Koshyand Mr Narayanan and contribution to the Board processesby them their continued association would benefit theCompany Declarations have been received from Mr Koshyand Mr Narayanan that they meet the criteria ofIndependence prescribed under Section 149 of the Act readwith the Companies (Appointment and Qualification ofDirectors) Rules 2014 and Regulation 16 of the ListingRegulations 2015 In the opinion of the Board Mr Koshyand Mr Narayanan fulfil the conditions specified in the Actthe Rules thereunder and the Listing Regulations 2015 forre-appointment as Independent Directors and they areindependent of the management of the Company Mr Koshyand Mr Narayanan will be entitled to sitting fees for attendingmeetings of the Board and its Committees
Consent of the Members by way of Special Resolution isrequired for re-appointment of Mr Koshy and Mr Narayananin terms of Section 149 of the Act Further pursuant toRegulation 17 of the Listing Regulations 2015 consent ofthe Members by way of Special Resolution is also requiredfor continuation of a Non-Executive Director beyond the ageof seventy five years During the proposed term ofre-appointment Mr Koshy and Mr Narayanan will attain theage of seventy five years on 12th February 2020 and1st July 2020 respectively The Special Resolutions under
Item No 6 and 7 once passed shall also be deemed asyour approval under the Listing Regulations 2015 forcontinuation of Mr Koshy and Mr Narayanan as IndependentDirectors beyond the age of seventy five years
Requisite Notices under Section 160 of the Act proposingthe re-appointment of Mr Koshy and Mr Narayanan havebeen received by the Company and consents have beenfiled by Mr Koshy and Mr Narayanan pursuant to Section152 of the Act
Additional information in respect of Mr Koshy andMr Narayanan pursuant to the Listing Regulations 2015and the Secretarial Standard on General Meetings isappearing in the Report and Accounts under the sectionslsquoYour Directorsrsquo and lsquoReport on Corporate GovernancersquoMr Koshy and Mr Narayanan do not hold any share in theCompany either in their individual capacity or on a beneficialbasis for any other person
Mr Koshy and Mr Narayanan and their relatives areinterested in the Special Resolutions relating to theirrespective re-appointment None of the other Directors andKey Managerial Personnel of the Company or theirrelatives is interested in these Special Resolutions
The Board recommends these Special Resolutions for yourapproval
By Order of the BoardGujarat Hotels Limited
Place New Delhi Jagdish SinghDate 15th July 2019 Director
8
ROUTE MAP
AGM VenueWelcomHotel VadodaraR C Dutt Road AlkapuriVadodara 390 007
9
N Anand
Nakul Anand (62) DIN 00022279 a Non-Executive Directorof the Company since 10th March 1998 was appointed asthe Chairman of the Company effective 21st March 2009He is an Executive Director on the Board of ITC Limited andholds responsibility for the Hospitality Travel amp Tourismand Lifestyle Retailing businesses of ITC
An Economics Honours Graduate from the Delhi Universitywith an AMP degree from the Bond University AustraliaAnand joined ITC Hotelsrsquo Management TrainingProgramme in 1978 He has also served as the ManagingDirector of erstwhile ITC Hotels Limited during the period2003-05
In a career that spans close to four decades Anand hasbeen acknowledged in the hotels and tourism industry forhis vision and commitment Leveraging the significantlearning of sustainable excellence within ITC he led theteam at ITC Hotels to pioneer the concept of lsquoResponsibleLuxuryrsquo in the hospitality industry securing LEEDreg Platinumcertifications for all ITC premium luxury hotels He hasformulated value-based strategies to create a uniquequality control model His dynamic leadership and passionfor the business is recognised and acknowledged by hispeers He has been a past President of the HotelAssociation of India and past Chairman of the CII NationalTourism Committee Anand is presently a member of theNational Tourism Advisory Council constituted by theMinistry of Tourism Government of India Chairman of theFederation of Associations in Indian Tourism amp Hospitalityand a Member of the Executive Committee of the HotelAssociation of India He is also a Member of the IndiandashSriLanka CEOs Forum Council Member amp ExecutiveCommittee Member of the National Culture Fund Ministryof Culture Government of India and a Member on the Boardof the International Tourism Partnership
Other Directorships
Name of the company Position
International Travel House Limited Chairman amp Non-Executive Director
Landbase India Limited Chairman amp Non-Executive Director
Fortune Park Hotels Limited Chairman amp Non-Executive Director
WelcomHotels Lanka (Private) Limited Chairman amp Non-Executive Director
Srinivasa Resorts Limited Vice Chairman amp Non-Executive Director
ITC Limited Executive Director
Bay Islands Hotels Limited Non-Executive Director
Maharaja Heritage Resorts Limited Non-Executive Director
Committee Membership of other companies
Name of the Committee Positioncompany
International Travel House Limited Nominations amp MemberRemuneration Committee
Landbase India Limited Audit Committee Member
Fortune Park Hotels Limited Corporate Social ChairmanResponsibility Committee
CK Koshy
Cheruvettolil Kochukoshy Koshy (74) DIN01478704 wasappointed as an Independent Non-Executive Director ofthe Company on 1st May 2007 He is Master of Arts inPolitical Science and Public Administration He joined theIndian Administrative Service in 1968 from the Gujarat Cadreand superannuated in February 2005
In a long career spanning over 38 years he has held severaleminent positions including those of Additional ChiefSecretary - Department of Revenue Industries and MinesTourism and Civil Aviation and Finance and PrincipalSecretary to the Chief Minister He served the Governmentof India as Joint Secretary amp Financial Advisor to theDepartment of Atomic Energy and as Executive Director ofNuclear Power Corporation of India Limited He has heldthe posts of Managing Director of the Tourism Corporationof Gujarat Sardar Sarovar Narmada Nigam Gujarat StateSmall Industries Corporation and Girinar Scooter LimitedHe was also the Joint Managing Director of the GujaratIndustrial Investment Corporation and Chairman of GujaratState Petroleum Corporation Limited Gujarat State PetronetLimited and Gujarat Energy Research and ManagementInstitute
Post retirement he has been a consultant to the Departmentfor International Development - UK the World Bank and tothe Department of Personnel and Administrative ReformsGovt of India He was appointed Professor Emeritus in thefaculty of Planning and Public Policy at CEPT UniversityAhmedabad and is an Advisor to both Indian School ofPetroleum and Energy New Delhi and University ofPetroleum and Energy Studies Dehradun Currently he isAdvisor at CEPT University and on the Board of Trustees ofAlliance Francaise Gujarat and GIAN an NGO whichencourages innovation at the grass root level
Koshy does not hold directorship of any other company
M Narayanan
Mahalinga Narayanan (74) DIN 00159288 was appointedas an Independent Non-Executive Director of the Companyon 10th January 2008 He is a post graduate in CommerceGraduate in Law Diploma Holder in Business Managementand holds certified Associated Membership of the Indian
YOUR DIRECTORS
10
Institute of Bankers He has rich experience of over fourdecades in Banking Project Finance Administration andrelated areas
Narayanan started his career with the Reserve Bank ofIndia in 1964 and moved over to the Bank of Baroda in1969 and continued till March 1985 During his tenure inBank of Baroda he worked in all departments of commercialbanking operation and was in-charge of large branches ofthe Bank In April 1985 he joined Industrial FinanceCorporation of India and held senior managementpositions In October 1997 he joined Tourism FinanceCorporation of India Limited as Managing Director and roseto the position of Chairman and Managing Director whichposition he held till his retirement in September 2006 Hewas conferred with ldquoUdyog Rattan Awardrdquo in the year 2005by the Institute of Economic Studies New Delhi
Other Directorships
Name of the company Position
Cox amp Kings Limited Independent DirectorTulip Star Hotels Limited Independent DirectorRoyale Indian Rail Tours Limited Independent DirectorPride Hotels Limited Chairman amp Independent Director
Committee Membership of other Companies
Name of the company Committee Position
Cox amp Kings Limited Audit Committee ChairmanRemuneration MemberCommittee
Pride Hotels Limited Audit Committee ChairmanRoyale Indian Rail Tours Limited Audit Committee Chairman
Tulip Star Hotels Limited Audit Committee Chairman
J Singh
Jagdish Singh (53) DIN 00042258 was appointed as aNon-Executive Director on the Board of the Company on16th April 2016 A Commerce Graduate and a CharteredAccountant Singh joined ITC Limited in the year 1990During these 26 years he has held various positions inthe finance function He started his career in Treasury andmoved as Corporate Accountant Commercial Manager atCigarette factory at Munger and Head of Finance at ITCEssentra Limited He was then the Head of Treasury
between 2005 and 2015 and is presently the Head ofFinance at ITCrsquos Hotels Division
Other DirectorshipsName of the company Position
International Travel House Limited Non-Executive DirectorFortune Park Hotels Limited Non-Executive DirectorBay Islands Hotels Limited Non-Executive DirectorSrinivasa Resorts Limited Non-Executive DirectorMaharaja Heritage Resorts Limited Non-Executive DirectorMimec (India) Limited Non-Executive DirectorLandbase India Limited Additional Non-Executive DirectorLogix Developers Private Limited Non-Executive Director
Committee Membership of other companiesName of the Committee Positioncompany
International Travel House Limited Stakeholders Relationship MemberCommitteeAudit Committee MemberNominations amp Remuneration MemberCommittee
Fortune Park Hotels Limited Corporate Social MemberResponsibility Committee
Srinivasa Resorts Limited Audit Committee ChairmanCorporate Social MemberResponsibility Committee
D R Choudhury
Devkanya Roy Choudhury (41) DIN 07066556 wasappointed as a Non-Executive Director of the Company on19th January 2015 A Graduate from the National LawSchool of India University Bengaluru she joined ITC Limitedin 2001 As part of Corporate Legal of ITC she has rich andvaried experience in handling legal matters pertaining tovarious divisions including Tobacco Hotels Personal CareLifestyle Retailing Education amp Stationery Paperboards ampSpecialty Papers ITC Infotech as also dealing with mergersamp acquisitions and key litigation across ITC CurrentlyMs Choudhury is the Senior Associate General Counsel ofITC Limited
Other Directorships
Name of the Company Position
WelcomHotels Lanka (Private) Limited Non-Executive Director
YOUR DIRECTORS
Denotes foreign company Denotes listed Indian company whose equity shares or preference shares or debt securities are listed on a recognised
stock exchangeNotes1 Other Directorships and Committee Memberships of Directors are as on 15th April 20192 Committee Memberships cover Committees under the Companies Act 2013 viz Audit Committee Stakeholders
Relationship Committee Nomination and Remuneration Committee and CSR Committee of Indian Companies
11
REPORT ON CORPORATE GOVERNANCE
The Directors present the Companyrsquos Report on CorporateGovernance pursuant to the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements)Regulations 2015 (lsquoListing Regulations 2015rsquo)
THE COMPANYrsquoS GOVERNANCE PHILOSOPHY
The Company firmly believes in good CorporateGovernance and has made it a practice and a continuousprocess of development right across the Company TheCompanyrsquos philosophy on Corporate Governanceenvisages attainment of high level of transparency andaccountability in the functioning of the Company andconduct of business and places due emphasis onregulatory compliance It has empowered the ExecutiveManagement to take decisions with regard to day-to-dayoperations and has also created checks and balances thatsuch decisions are taken with care and responsibility tomeet stakeholdersrsquo aspirations and societal expectations
The Companyrsquos corporate philosophy is focused on itspeople who are its most important asset and it values itsemployeesrsquo integrity creativity ability judgement andopinions who in turn demonstrate the highest ethicalstandards and responsibility towards the shareholdersThis has helped the Company take rapid strides in itspursuit of excellence
The Company is committed to enhance shareholder valuein a fair and transparent manner and has been in theforefront for benchmarking itself with the best businesspractices globally
BOARD OF DIRECTORS
All statutory and other significant and material informationare placed before the Board of Directors (the Board) toenable it to discharge its responsibility of strategicsupervision of the Company as trustees of theshareholders
Composition
The Board comprises entirely of Non-Executive Directorsincluding one Woman Director and two IndependentDirectors The strength of the Board as on 15th April 2019is five
The Board Diversity Policy of the Company requires theBoard to have balance of skills experience and diversity ofperspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the Annexure forming part ofthis Report These skills expertise and competencies areavailable in the present mix of the Directors of the Company
Composition of the Board as on 31st March 2019
Category No of PercentageDirectors to total no
of Directors
Non-Executive Independent Directors 3 50Other Non-Executive Directors 3 50Total 6 100
During the year there was no change in the directorshipMr R C Mehta resigned as Non-Executive IndependentDirector of the Company with close of work on 31st March2019 keeping in view the Regulation 17(1A) of ListingRegulations 2015
Mr Mehta has confirmed that there are no other reasons forhis resignation other than stated above
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Board were held The intervening periodbetween two Board meetings was well within the maximumgap of 120 days prescribed under the Listing Regulations2015
Board Agenda
Meetings are governed by a structured agenda The Boardmembers in consultation with the Chairman may bring upany matter for the consideration of the Board All majoragenda items are backed by comprehensive backgroundinformation to enable the Board to take informed decisionsAgenda papers are generally circulated seven days prior tothe Board meeting
Information placed before the Board
The following matters are tabled for the Boardrsquos periodicreview information
bull Annual operating plans amp budgets and periodic reviewof the Companyrsquos businesses
bull Quarterly performance
bull External Audit Management Reports (through the AuditCommittee)
bull Status of legal compliance
bull Status and effectiveness of risk management plans
bull Succession to senior management (through theNominations and Remuneration Committee)
bull Statutory compliance reports
bull Show cause demand prosecution adjudicationnotices if any from revenue authorities which areconsidered materially important including anyexposure that exceeds 1 of the Companyrsquos net worthand their outcome
12
bull W rite-offs disposals (fixed assets receivablesadvances etc) on a half-yearly basis
bull Significant development in Human Resources Industrial Relations
bull Material non-compliance of any regulatory or listingrequirements and in relation to shareholdersrsquoservices
bull All other matters required to be placed before theBoard for its review information under the ListingRegulations 2015 and other statutes
Post-meeting follow-up systemThe Governance processes in the Company include aneffective post-meeting follow-up review and reportingprocess for action taken pending on decisions of the Boardand the Board Committees
Details of Board Meeting during the financial year
During the financial year ended 31st March 2019 fourmeetings of the Board were held as follows
SI Date Board No ofNo Strength Directors
present
1 17th April 2018 6 6
2 7th August 2018 6 6
3 1st November 2018 6 5
4 30th January 2019 6 5
COMMITTEES OF THE BOARD
Currently there are three Committees of the Board ndash theAudit Committee the Stakeholders RelationshipCommittee and the Nominations and RemunerationCommittee The terms of reference of the BoardCommittees are determined by the Board from time to timeMeetings of Board Committees are convened by therespective Committee Chairman All the recommendationsmade by Board Committees during the year were acceptedby the Board Minutes of Board Committee meetings areplaced before the Board for its information The role andcomposition of these Committees including the numberof meetings held during the financial year and the relatedattendance are provided below
A AUDIT COMMITTEEThe Audit Committee of the Board provides reassurance tothe Board on the existence of an effective internal controlenvironment that ensuresbull efficiency and effectiveness of operations
bull safeguarding of assets and adequacy of provisionsfor all liabilities
bull reliability of financial and other managementinformation and adequacy of disclosures
bull compliance with all relevant statutesThe role of the Committee includes the followingbull To oversee the Companyrsquos financial reporting process
and the disclosure of its financial information to
REPORT ON CORPORATE GOVERNANCE
Directorsrsquo attendance at the Board Meetings during the financial year and at the last Annual General Meeting (AGM) as alsotheir other Directorships and Committee Memberships are given below
SI Director Category No of Attendance No of No of Membership(s) No Board at last other Chairmanship(s) of Audit
Meetings AGM Directorship(s) Committee Stakeholdersattended Relationship Committee of
other Indian public limitedcompanies
1 N Anand Chairman amp 4 Yes 8 1Non-Executive Director
2 C K Koshy Non-Executive 4 Yes Nil NilIndependent Director
3 R C Mehta1 Non-Executive 2 Yes 4 NilIndependent Director
4 M Narayanan Non-Executive 4 Yes 4 4 (all as Chairman)Independent Director
5 D R Choudhary Non-Executive Director 4 Yes 1 Nil6 J Singh Non-Executive Director 4 Yes 8 3 (including 1 as Chairman)
1 Resigned as Non-Executive Independent Director wef 1st April 2019 Details with respect to other Directorships of the Directors are provided under the section lsquoYour Directorsrsquo in the Report and Accounts
13
ensure that the financial statements are correctsufficient and credible
bull To recommend the appointment remuneration termsof appointment and removal of Statutory Auditors
bull To approve transactions of the Company with relatedparties
bull To evaluate the Companyrsquos internal financial controlsand risk management systems
bull To review with the management the following
- Annual financial statements and Auditorrsquos Reportthereon before submission to the Board forapproval
- Quarterly financial statements before submissionto the Board for approval
bull To review the following
- Management discussion and analysis of financialcondition amp results of operations and mattersrequired to be included in the DirectorsrsquoResponsibility Statement
- Adequacy of internal control systems and theCompanyrsquos statement on the same prior toendorsement by the Board such review to bedone in consultation with the managementStatutory and Internal Auditors
- Adequacy of internal control systems forcompliance with the provisions of the Securitiesand Exchange Board of India (Prohibition ofInsider Trading) Regulations 2015
- Reports of Internal Audit and discussion withInternal Auditors on any significant findings andfollow-up thereon
- Statutory Auditorsrsquo independence andperformance and effectiveness of the auditprocess
- System for storage retrieval security etc of booksof account maintained in the electronic form
- Functioning of Whistleblower mechanism in theCompany
Composition
The Audit Committee as on 15th April 2019 comprisesthree Non-Executive Directors two of whom are IndependentDirectors The Chairman of the Committee is anIndependent Director The Chief Executive Officer the ChiefFinancial Officer and the representative of Statutory Auditorsare Invitees to meetings of the Audit Committee and theCompany Secretary is the Secretary to the Committee Allmembers of the Committee are financially literate twomembers including the Chairman of the Committee haveaccounting and financial management expertise
The names of the members of the Audit Committeeincluding its Chairman are provided under the sectionlsquoBoard of Directors amp Committeesrsquo in the Report andAccounts
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Audit Committee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 4 4
2 7th August 2018 4 4
3 1st November 2018 4 3
4 30th January 2019 4 3
Attendance at Audit Committee Meetings during thefinancial year
Member No of meetingsattended
M Narayanan1 4
C K Koshy 4
R C Mehta2 2
J Singh 41 Appointed Chairman wef 15th April 20192 Ceased to be Member and Chairman wef 1st April 2019
B STAKEHOLDERS RELATIONSHIP COMMITTEE
The Stakeholders Relationship Committee of the Boardoversees redressal of shareholder and investor grievancesand inter alia approves transmission of sharessub-division consolidation renewal of share certificatesissue of duplicate share certificates etc
Composition
The Stakeholders Relationship Committee presentlycomprises three Non-Executive Directors including oneIndependent Director The Chairman of the Committee is aNon-Executive Director The Company Secretary is theSecretary to the Committee
The names of the members of the StakeholdersRelationship Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 sevenmeetings of the Stakeholders Relationship Committeewere held as follows
REPORT ON CORPORATE GOVERNANCE
14
SI Date Committee No ofNo Strength Members
present1 17th April 2018 2 2
2 29th June 2018 2 2
3 7th August 2018 2 2
4 27th September 2018 2 2
5 1st November 2018 2 2
6 4th January 2019 2 2
7 30th January 2019 2 2
Attendance at Stakeholders Relationship CommitteeMeetings during the financial year
Member No of meetingsattended
J Singh 7
D R Choudhury 7
C K Koshy 0
Appointed Member wef 31st March 2019
C NOMINATIONS AND REMUNERATION COMMITTEEThe Nominations and Remuneration Committee of theBoard inter alia identifies persons qualified to becomeDirectors and formulates criteria for evaluation ofperformance of the Directors and the Board as a wholeThe Committeersquos role includes recommending to theBoard the appointment remuneration and removal ofDirectors and Key Managerial Personnel
Composition
The Nominations and Remuneration Committee as on15th April 2019 comprises four Non-Executive Directorstwo of whom are Independent Directors The Chairman ofthe Committee is an Independent Director The CompanySecretary is the Secretary to the Committee
The names of the members of the Nominations andRemuneration Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 twomeetings of the Nominations and RemunerationCommittee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 5 5
2 30th January 2019 5 4
Attendance at Nominations and Remuneration CommitteeMeetings during the financial year
Member No of meetingsattended
C K Koshy 2
N Anand 2
R C Mehta1 1
M Narayanan 2
J Singh 21 Ceased to be Member wef 1st April 2019
Remuneration Policy
The Companyrsquos Remuneration Policy aims at attractingand retaining high calibre talent The Remuneration Policytherefore is market-led and takes into account thecompetitive circumstance of each business so as to attractand retain quality talent and leverage performancesignificantly
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpwwwgujarathotels ltd in polic ies Remuneration-Policy_GHLpdf There has been no change in the Policyduring the year
Remuneration of Directors
Non-Executive Directors are entitled to sitting fees forattending the meetings of the Board and its Committeesthe quantum of which is determined by the Board Thesitting fees to Non-Executive Directors as determined bythe Board are ` 20000- and ` 10000- for each meeting ofthe Board and its Committees respectively
Details of sitting fees paid to the Directors during thefinancial year ended 31st March 2019
Director Sitting Fees (`)
C K Koshy 150000-
R C Mehta1 70000-
M Narayanan 150000-1 Resigned as Non-Executive Independent Director wef1st April 2019
Note Disclosure with respect to Non-Executive Directors ndashPecuniary relationship or transaction None
Performance Evaluation
Performance evaluation of the Board the BoardCommittees and the individual Directors was carried outby the Board in accordance with the Policy approved by theNominations and Remuneration Committee in this regardbrief details of the same are provided in the lsquoReport of theBoard of Directors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
REPORT ON CORPORATE GOVERNANCE
15
Directorsrsquo Shareholding
Details of Shareholding of the Directors in the Company ason 31st March 2019 are given below
Director No of Equity Shares of ` 10-each held singly jointly
N Anand 200
D R Choudhury Nil
C K Koshy Nil
R C Mehta Nil
M Narayanan Nil
J Singh Nil
OTHER DISCLOSURESbull Details of non-compliances penalties and strictures
by Stock Exchanges SEBI Statutory Authorities onany matter related to capital markets during the lastthree years
Nonebull Inter-se relationships between Directors and Key
Managerial Personnel of the Company
Nonebull Materially significant related party transactions which
may have potential conflict with the interests of theCompany at large
Nonebull Material financial and commercial transactions of
senior management where they may have hadpersonal interest and which had potential conflict withthe interests of the Company at large
Nonebull Details of utilisation of funds raised through
preferential allotment or qualified institutionsplacement
Not Applicablebull Credit rating(s) obtained by the Company for any debt
instrument fixed deposit programme or any otherscheme involving mobilisation of funds
Nonebull None of the Directors of the Company has been
debarred or disqualified from being appointed orcontinuing as a Director by SEBI Ministry of CorporateAffairs Statutory Authorities which has also beenconfirmed by Messrs PB amp Associates PractisingCompany Secretaries
bull Confirmation by the Board with respect to theIndependent Directors is provided in the lsquoReport ofthe Board of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Disclosures in relation to the Sexual Harassment ofWomen at Workplace (Prevention Prohibition andRedressal) Act 2013 are provided in the lsquoReport of theBoard of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Information with respect to lsquoCommodity Price Risk orForeign Exchange Risk and Hedging Activitiesrsquo
Nonebull The total fees paid by the Company to Messrs K C
Mehta amp Co Statutory Auditors and all other entitiesforming part of the same network aggregate` 100000-
bull Compliance Officer under the Listing Regulations2015
Deepak Kumar Gulati Company Secretary
MEANS OF COMMUNICATION
Timely disclosure of consistent comparable relevant andreliable information on corporate financial performance isat the core of good governance Towards this end thequarterly results of the Company were announced withinforty five days from the end of the quarter Audited annualresults along with the results for the fourth quarter wereannounced within sixty days from the end of the financialyear Extract of these results were published in lsquoTheFinancial Expressrsquo (all editions) and in its Gujarati editionas vernacular newspaper Further quarterly resultsshareholding pattern and other material events amp importantinformation relating to the Company were submitted to BSELimited through BSE Listing Centre for dissemination onits website The Company publishes its quarterlyhalf-yearly and annual financial results and also posts suchresults on its website wwwgujarathotelsltdin
The Report of the Board of Directors forming part of theReport and Accounts includes all aspects of lsquoManagementDiscussion and Analysisrsquo as required under the ListingRegulations 2015
GHL CODE OF CONDUCT FOR PREVENTION OF INSIDERTRADING ndash 2019
The GHL Code of Conduct for Prevention of Insider Tradingapproved by the Board inter alia prohibits trading insecurities of the Company by Directors and employeeswhile in possession of unpublished price sensitiveinformation in relation to the Company
GHL CODE OF CONDUCT
The GHL Code of Conduct is applicable to Directors seniormanagement and employees of the Company The Codeis derived from three interlinked fundamental principlesviz good corporate governance good corporate citizenshipand exemplary personal conduct in relation to theCompanyrsquos business and reputation The Code coversGHLrsquos commitment to sustainable development concern
REPORT ON CORPORATE GOVERNANCE
16
for occupational health safety and environment a genderfriendly workplace transparency and auditability legalcompliance and the philosophy of leading by personalexample The Code is available on the Companyrsquos website
Declaration as required under the Listing Regulations 2015All Directors and senior management of the Companyhave affirmed compliance with the GHL Code of Conductfor the financial year ended 31st March 2019New Delhi K Pahwa15th April 2019 CEO
WHISTLEBLOWER POLICYSynopsis of the Whistleblower Policy of the Company isprovided in the lsquoReport of the Board of Directors ampManagement Discussion and Analysisrsquo forming part of theReport and Accounts The Whistleblower Policy is alsoavailable on the Companyrsquos websiteFAMILIARISATION PROGRAMME FOR DIRECTORSGHL believes that a Board which is well informed familiarised with the Company and its affairs can contributesignificantly to effectively discharge its role of trusteeshipin a manner that fulfils stakeholdersrsquo aspirations andsocietal expectations In pursuit of this the Directors of theCompany are updated on changes developments in thedomestic global corporate and industry scenario includingthose pertaining to statutes legislations and economicenvironment and on matters affecting the Company toenable them to take well informed and timely decisionsFurther details may be accessed on the Companyrsquos websiteat httpwwwgujarathotelsltdinpoliciesDirectorrsquos-Familiarisation-programmespdfPOLICY ON RELATED PARTY TRANSACTIONSThe Policy as approved by the Board may be accessed onthe Companyrsquos website at
h t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_TranscationspdfDISCRETIONARY REQUIREMENTS UNDER THE LISTINGREGULATIONS 2015The status of compliance with the discretionaryrequirements under the Listing Regulations 2015 isprovided below1 Chairmanrsquos Office The Company has a Non-Executive
Chairman but he does not maintain any separate officeand hence no expense in this regard is being incurredby the Company
2 Shareholder Rights The quarterly half-yearly andannual financial results of the Company are postedon the Companyrsquos website and extract of these resultsare published in newspapers on an all India basisThe complete Report and Accounts is sent to everyShareholder of the Company
3 Audit Opinion It has always been the Companyrsquosendevour to present financial statements with
unmodified audit opinion The Statutory Auditors haveissued an unmodified audit opinion on the Companyrsquosfinancial statements for the year ended 31st March2019
4 Separate posts of Chairman and Chief ExecutiveOfficer The Company has a Non-Executive Chairmanand a Chief Executive Officer
5 Internal Audit The Internal Auditor of the CompanyMessrs Shah amp Talati Chartered Accountants reportsto the Audit Committee of the Board
GENERAL SHAREHOLDER INFORMATIONProvided in the lsquoShareholder Informationrsquo section of theReport and Accounts
CONFIRMATION OF COMPLIANCEbull It is confirmed that the Company has complied with
the requirements prescribed under Regulations 17 to27 and clauses (b) to (i) of sub - regulation (2) ofRegulation 46 of the Listing Regulations 2015
bull The Statutory Auditorsrsquo Certificate that the Companyhas complied with the conditions of CorporateGovernance is annexed to the lsquoReport of the Board ofDirectors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
ANNEXURE TO THE REPORT ON CORPORATEGOVERNANCESKILLS EXPERTISE AND COMPETENCIES OF DIRECTORSThe Company believes that Board members should havea balance of skills experience and diversity of perspectivesappropriate to the Company Accordingly the Directorsshould possess one or more of the following skillsexpertise and competencies
1 Leadership
Leadership experience in a commensurate-sizedorganisation with understanding of organisationalsystems and processes strategic areas andemerging business trends
2 Industry Knowledge and Experience
Domain knowledge of Hotel business and itsdynamics long-term strategies and regulatory ampcompetitive environment
3 Finance and Accounting
Ability to understand financial policies accountingstatements and disclosure practices to contribute tothe financial risk management policies and practicesof the Company
4 Governance
Commitment belief and experience in settinggovernance practices to support the Companys legalcompliance systems and governance polic ies practices
REPORT ON CORPORATE GOVERNANCE
17
SHAREHOLDER INFORMATION
AGM Details
Date Saturday 7th September 2019Venue WelcomHotel Vadodara R C Dutt Road
Alkapuri Vadodara 390 007Time 1100 amBook Friday 30th August 2019 toClosure Saturday 7th September 2019Dates (both days inclusive)Dividend Friday 13th September 2019PaymentDate
Registrar and Share Transfer Agents
Messrs MCS Share Transfer Agent Limited are the Registrarand Share Transfer Agents (RTA) of the Company forcarrying out share registration and other related activitiesof the Company
Address for Correspondence
MCS Share Transfer Agent LimitedF-65 1st Floor Okhla Industrial AreaPhase ndash I New Delhi - 110 020Telephone Nos 011 4140 6149-52 4160 9386Facsimile No 011 4170 9881E-mail helpdeskdelhimcsregistrarscom
Shareholders holding shares in the dematerialised formshould address their correspondence except those relatedto dividend to their respective Depository Participants
Share Transfer Committee
The Share Transfer Committee of the Company generallymeets once in ten days for approving share transfers Theprocessing activities with respect to requests received forshare transfers are completed within fifteen days from thedate of receipt of request The Committee met 11 timesduring the financial year ended 31st March 2019 to approveshare transfers There were no share transfers pendingas on 31st March 2019
The Share Transfer Committee presently comprises thefollowing
D R Choudhury - Director MemberJ Singh - Director MemberM Agarwal - Compliance Officer Member
Dematerialisation of Shares and Liquidity
The shares of the Company are available for trading in thedematerialised form under both the Depository Systems inIndia - NSDL and CDSL The International SecuritiesIdentification Number (lSIN) allotted to the Companysshares under the Depository System is INE621C01011
As on 31st March 2019 a total of 3525013 Equity Sharesof the Company which translates to 9307 of the ShareCapital stood dematerialised The processing activitieswith respect to requests received for dematerialisation arecompleted between fifteen to thirty daysShareholder Investor ComplaintsThe Company attends to Shareholder Investor complaintsqueries and other correspondence generally within fifteendays except where constrained by disputes or legalimpedimentsThe Company did not receive any complaint during thefinancial year ended 31st March 2019The e-mail ID earmarked by the Company for this purposeghlinvestorsyahoocoinDistribution of Shareholding as on 31st March 2019
No of No of EquityNo of Shareholders Shares
SharesSlab Total to Total to
Share Shareholders Capital
1 - 500 5152 9455 587438 1551501 - 1000 138 253 112061 296
1001 - 2000 68 125 100167 2652001 - 3000 26 048 62030 1643001 - 4000 16 029 58804 1554001 - 5000 11 020 50785 1345001 - 10000 23 042 163405 431
10001 - 50000 8 015 147787 39050001 - 100000 3 006 226954 599
100001 amp Above 4 007 2278084 6015Total 5449 10000 3787515 10000
Categories of Shareholders as on 31st March 2019Sl Category No of toNo Shares Share
held hold ingA Promoter Holding1 Promoter and Promoter Group
ITC Limited 1733907 4578Russell Investments Limited 300056 792Sub-Total 2033963 5370
B Non Promoter Holding2 Institutional Investorsa Mutual Funds NIL NILb Banks 100 000c Foreign Institutional Investors and NIL NIL
Foreign Portfolio InvestorsSub-Total 100 000
3 Othersa Private Corporate Bodies 193726 511b Indian Public 1335461 3527c NRIs 102362 270d Others 121903 322
Sub Total 1753452 4630Grand Total 3787515 10000
18
Monthly High and Low Quotes and Volume of Sharestraded on BSE Limited
Year Month High L o w Volume(` ) (` ) (Nos)
2018 April 13800 12000 93584May 13100 11710 26778June 12735 11500 18090July 12195 11400 27113August 12295 11450 14900September 12000 10900 23492October 11400 10505 18787November 12975 10700 15386December 11490 10700 40291
2019 January 11320 10700 22160February 11185 10005 12395March 11295 10400 21625
Performance in comparison to broad based indices suchas SampP BSE Sensex
Note - Indicates monthly closing positions
Listing of Shares on Stock Exchange (with Stock Code)BSE Limited (507960)Phiroze Jeejeebhoy Towers Dalal Street Mumbai 400 001Telephone Nos 022-2272 1233 34Facsimile No 022-2272 1919E-mail isbseindiacomWebsite wwwbseindiacom
The Listing Fee for the financial year 2019-20 has beenpaid to BSE Limited
Financial CalendarFinancial Year 2019-20(1st April - 31st March)
1 First Quarter Results July 20192 Second Quarter and October November 2019
Half-Year Results3 Third Quarter Results January February 20204 Fourth Quarter and May 2020
Annual Results
Particulars of past three AGMsAGM Financial Venue Date Time Special
Year ResolutionPassed
36th 2017-18 WelcomHotel 07-08-2018 NoneVadodara
35th 2016-17 R C Dutt Road 08-08-2017 1100 NoneAlkapuri am
34th 2015-16 Vadodara 20-09-2016 None390 007
Postal Ballot
No special resolution requiring postal ballot was eitherproposed last year or is being proposed for the ensuing AGM
SHAREHOLDER REFERENCER
Transfer of Shares in certificate form
Effective 1st April 2019 transfer of shares of a listedcompany can only be effected in dematerialised form interms of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 Shareholders holdingshares in the certificate form are therefore requested todematerialise their shares in their own interestCommunication in this respect has been sent by theCompany during the year to the concerned ShareholdersHowever transfer deeds which were lodged with theCompany on or before 31st March 2019 but were returneddue to any deficiency will be processed upon re-lodgement
Transfer of Dividend and corresponding Equity Shares tothe Investor Education and Protection Fund (IEPF)
During the financial year 2018-19 unclaimed dividend forthe financial year 2010-11 aggregating ` 636444- andthe corresponding 13150 Equity Shares in respect of whichdividend entitlements remained unclaimed for sevenconsecutive years or more have been transferred by theCompany to the IEPF established by the CentralGovernment pursuant to the provisions of Section 124 ofthe Companies Act 2013 read with the Investor Educationand Protection Fund Authority (Accounting Audit Transferand Refund) Rules 2016
Shareholders may claim their unclaimed dividend for theyears prior to and including the financial year 2010-11 andthe corresponding shares from the IEPF Authority byapplying in the prescribed Form No IEPF-5 This Form canbe downloaded from the website of the IEPF Authoritywwwiepfgovin the access link of which is also availableon the Companys website wwwgujarathotelsltdin underthe section General Information under Shareholder Value
The unclaimed dividend for the undernoted years and thecorresponding shares will be transferred by the Companyto the IEPF in accordance with the schedule given belowAttention in particular is drawn that the unclaimed dividendfor the financial year 2011-12 and the corresponding shareswill be due for transfer to the IEPF on 14th September
SHAREHOLDER INFORMATION
19
Central Depository Services (India) LimitedMarathon Futurex A Wing 25th FloorMafatlal Mill Compound N M Joshi MargLower Parel Mumbai 400 013Telephone No 022-2302 3333Facsimile No 022-2300 2035E-mail helpdeskcdslindiacomWebsite wwwcdslindiacomRemittance of Dividend through Electronic ModeThe Company provides the facility for remittance of dividendto Shareholders through RTGS (Real Time GrossSettlement) NACH (National Automated Clearing House) NEFT (National Electronic Funds Transfer)
Shareholders who have not opted for remittance of dividendthrough electronic mode and wish to avail the same arerequired to provide their bank details including IFSC (IndianFinancial System Code) and MICR (Magnetic Ink CharacterRecognition) to their respective Depository Participants(DPs) or to the RTA where shares are held in thedematerialised form and in the certificate form respectively
Shareholders holding shares in the certificate form mayuse the Mandate Form for this purpose which can bedownloaded from the Companys websitewwwgujarathotelsltdin under the section GeneralInformation under Shareholder Value
Address and Bank DetailsShareholders holding shares in the certificate form arerequested to advise the RTA of any change in their address mandate bank details to facilitate better servicingShareholders are advised that as a measure of protectionagainst fraudulent encashment their bank details oraddress as available with the RTA will be printed on thedividend warrants or demand drafts where dividend cannotbe remitted through electronic mode
Permanent Account Number (PAN)Shareholders holding shares in the certificate form arerequested to send copies of their PAN Cards to the RTA tofacilitate better servicing
Furnishing of PAN Card however is mandatory as followsi) Transferees and Transferors PAN Cards for transfer
of sharesii) Legal heirs Nominees PAN Cards for transmission
of sharesiii) Surviving joint holders PAN Cards for deletion of name
of deceased Shareholders andiv) Joint holders PAN Cards for transposition of shares
Nomination Facility
Shareholders who hold shares in the certificate form andwish to make any nomination change nomination madeearlier in respect of their shareholding in the Companyshould submit to the RTA the prescribed Form such Formcan be downloaded from the Companys website underthe section Investor Relations under Shareholder Value
SHAREHOLDER INFORMATION
2019 for which purpose communication has been sent tothe concerned Shareholders advising them to write to theCompany to claim their dividend Notices in this regardhave also been published in newspapers Details of suchunclaimed dividend and corresponding shares areavailable on the Companys website under the sectionGeneral Information under Shareholder Value
Financial Date of declaration Due date for transferYear of Dividend to IEPF2011-12 8th August 2012 14th September 2019
2012-13 13th August 2013 19th September 2020
2013-14 29th September 2014 5th November 2021
2014-15 29th September2015 5th November 2022
2015-16 20th September 2016 26th October 2023
2016-17 8th August 2017 14th September 2024
2017-18 7th August 2018 12th September 2025
The Company will not be able to entertain any claim receivedafter 12th September 2019
Shareholders who have not so far encashed their dividendwarrant(s) or have not received the same are requested toapply for duplicate warrant(s) by writing to the Companyand confirming non-encashment non-receipt of dividendwarrant(s)
Service of Documents
The Company sends Notices Report and Accounts andother communications in electronic mode to thoseShareholders who have registered their e-mail addresseswith the Company or with the Depositories and in physicalmode to the other Shareholders
Shareholders who wish to register or update their e-mailaddresses with the Company may use the Form forregistration updation which can be downloaded from theCompanys website under the section Investor Relationsunder Shareholder Value
Depository Services
Shareholders may write to the respective Depository or tothe RTA for guidance on depository services
The contact details of the Depositories are given below
National Securities Depository LimitedTrade World A Wing 4th FloorKamala Mills CompoundSenapati Bapat Marg Lower ParelMumbai 400 013Telephone No 022-2499 4200Facsimile No 022-2497 6351E-mail infonsdlcoinWebsite wwwnsdlcoin
20
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
FOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019Your Directors submit their Report for the financial yearended 31st March 2019
BUSINESS ENVIRONMENT
The global economic growth softened to 36 in 2018representing a marked slowdown compared to the 39growth anticipated at the beginning of the year buoyed bya strong fiscal expansion in the USA which was offset largelyby slower growth in some other large economies ieEurope Japan etc Going forward global growth in 2019 isprojected to decline further to 33 in the base case withrisks to the downside emanating from politicaluncertainties rising trade tensions escalatingprotectionism and tighter financial conditions
As per Ministry of Statistics amp Programme Implementation(MSPI) Indian economy registered the GDP growth of 7in 2018-19 as compared to 72 in 2017-18 The economyis expected to grow and maintain a level of 75 in 2019and 2020 as per the World Bank estimates
India is the most digitally-advanced traveller nation in termsof digital tools being used for planning booking andexperiencing a journey During 2018 foreign tourist arrivals(FTAs) in India stood at 1056 million achieving a growthrate of 52 year-on-year The Government of India is alsoworking to achieve 1 share in worldrsquos international touristarrivals by 2020 and 2 share by 2025
The operating environment in the hospitality sector showedimprovement with foreign tourist arrivals Indiarsquos risingmiddle class and increasing disposable incomes havecontinued to support the growth of domestic tourism
With the inauguration of Statue of Sardar Vallabhbhai Patelalso known as lsquoStatute of Unityrsquo which is the higheststanding statue in the world at a height of 182 meters thetourism in the city of Vadodara is expected to grow
FINANCIAL PERFORMANCE
During the year under review your Company earned licensefees of ` 36987 lakhs (previous year ` 33098 lakhs)Theother income at ` 19626 lakhs showed an increase mainlydue to improvement in return on current investment Preand post-tax profits increased to ` 51822 lakhs (previousyear ` 45313 lakhs) and ` 40788 lakhs (previous year` 33690 lakhs) respectively
Your Directors are pleased to recommend a dividend of` 350 per Equity Share of ` 10- each for the year ended31st March 2019 thereby maintaining last yearrsquos dividendand involving a cash outflow of ` 160 lakhs includingDividend Distribution Tax of ` 27 Lakhs
PROFITS DIVIDEND AND RETAINED EARNINGS
The financial results of your Company summarised areas under
For the year ended For the year ended31st March 2019 31st March 2018
Profits (` ) (` )
a Profit Before Tax 51822363 45312928
b Tax Expense
Current Tax 11653499 9272310Deferred Tax (618755) 2350502
c Profit for the year 40787619 33690116
d Other Comprehensive Income - -
e Total Comprehensive Income 40787619 33690116
Statement of Retained Earningsa At the beginning of the year 213211090 195873461
b Add Total Comprehensive Income 40787619 33690116
c Less Dividend paid including IncomeTax on Dividend paid 15981176 15954974
d Less Income Tax on Dividend paid forearlier year - 397513
e At the end of the year 238017533 213211090
Your Directors are pleased to recommend a dividend of` 350 per Equity Share (Previous Year ` 350) of ` 10-each for the year ended 31st March 2019
Details of changes in Key Financial Ratio amp Return onNet Worth
The key financial ratio of the Company where there hasbeen significant change (25 or more) and change inReturn on Net Worth are summarized below pursuant toSchedule V (B) to the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements)Regulations 2015 (Listing Regulations 2015)
HOTEL OPERATIONS
Your Hotel WelcomHotel Vadodara licensed to ITC Limitedrecorded an income of ` 249443 lakhs during the year ascompared to ` 221856 lakhs in the previous year Therewas an improvement in both occupancy and average roomrates leading to an overall improvement in HotelPerformance
Financial Ratio
2018-19 2017-18 Change
Reason for change
Current Ratio
278 223 25 Increase in value of current investment based on accumulation of market return and fresh investment done during the year out of surplus funds
Return on Net Worth
133 120 11 Due to higher rate of growth in profit after tax
21
The Food amp Beverage segment of your Companyrsquos Hotelcontinues to be a major strength The Peshawri Restaurantand the Welcom Cafeacute Cambay both retained their premiumleadership positions
Your Company has filed a writ petition in the Gujarat HighCourt seeking that the Gujarat State Government be directedto take action on your Companyrsquos application to have theleasehold land of the Hotel converted to freehold andtransferred to your Company as per the existing governmentpolicy in this regard The Honourable High Court passedan Order on 24th December 2014 restraining the StateGovernment from disturbing the peaceful and actualpossession of the Company over the hotel property in anymanner including construction thereon The writ petition ispending
Your Company is also making all efforts for expeditiousconversion of land from leasehold to freehold or in thealternative extension of Lease For further details pleaserefer to Note no 20A of the Accounts
SUBSIDIARIES ASSOCIATES AND JOINT VENTURES
The Company does not have any subsidiary associate orjoint venture
INTERNAL FINANCIAL CONTROLS
Your Company is managed by the Board of Directors andthe Executive Management with clearly defined rolesresponsibilities and authorities The Executive Managementis responsible for the day-to-day conduct of the affairs ofthe Company within the overall framework approved by theBoard Your Company also has a Code of Conduct whichrequires management to conform to the required financialand accounting policies systems and processes conductbusiness ethically and ensure strict compliance with allapplicable laws and regulations Ongoing ReviewProcesses and the Risk Management Framework create acontrol environment in the Company and provide thecornerstones for Internal Financial Controls with referenceto your Companyrsquos Financial Statements
Your Companyrsquos Financial Statements are prepared on thebasis of the Significant Accounting Policies that are carefullyselected by the management and approved by the AuditCommittee and the Board These Policies are reviewedand updated from time to time and audited by the InternalAuditor whose findings and recommendations are reviewedby the Audit Committee and tracked through toimplementation
Your Company maintains its Books of Account in electronicform Your Company has in place adequate internalfinancial controls with reference to the FinancialStatements
The Internal Auditors of the Company evaluates theadequacy and efficacy of such internal financial controlsSuch controls have been assessed during the year by the
management Based on the results of this assessmentno reportable material weakness or significant deficienciesin the design or operation of internal financial controls wereobserved Nonetheless your Company recognises that anyinternal financial control framework no matter how welldesigned has inherent limitations and accordingly regularaudit and review processes ensure that such systems arereinforced on an ongoing basis
RISK MANAGEMENT
Your Company continues its emphasis on a systems-basedapproach to business risk managementBacked by stronginternal control systems the current Risk Managementframework consists of the following key elements
- The Board of Directors (lsquoThe Boardrsquo) has clearly laiddown the roles and responsibilities of the Company inrelation to risk management covering a range ofresponsibilities from strategic to operational Theserole definitions provide the foundation for yourCompanyrsquos Risk Management Policy that is endorsedby the Board and is aimed at ensuring formulation ofappropriate risk management procedures theireffective implementation and independent monitoringand reporting by Internal Audit
- Management of risks vest with the ExecutiveManagement which is responsible for the day-to-dayconduct of the affairs of the Company within the overallframework approved by the Board
- A combination of policies and procedures which areregularly reviewed and updated in the light of changingbusiness and regulatory environment bringsrobustness to the process of ensuring that businessrisks are effectively addressed
- Appropriate structures are in place to proactivelymonitor and manage the inherent risks in businesswith unique relatively high risk profiles
- An Independent Internal Audit Firm carries out riskfocused audits enabling identification of areas whererisk management processes may need to bestrengthened
- The Audit Committee of the Board reviews the InternalAudit findings and provides strategic guidance oninternal controls The Chief Executive Officer closelymonitors the internal control environment within yourCompany including implementation of the action plansemerging out of internal audit findings
The combination of policies and processes as outlinedabove adequately address the various risks associatedwith your Companyrsquos business
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
22
AUDIT AND SYSTEMS
Your Company believes that internal control is a necessaryadjunct to the principle of governance that freedom ofmanagement should be exercised within a framework ofappropriate checks and balances Your Company remainscommitted to ensuring an effective internal controlenvironment that provides assurance and comfort on orderlyand efficient conduct of operations security of assetsprevention and detection of frauds errors accuracy andcompleteness of accounting records and timely preparationof reliable financial information
Your Companyrsquos independent and robust Internal Auditprocesses provide assurance on the adequacy andeffectiveness of internal controls compliance withoperating systems internal policies and regulatoryrequirements
The Internal Audit function consisting of an outsourcedprofessional firm is adequately resourced to deliver highstandards of audit assurances
The Audit Committee of your Board met four times duringthe year The Terms of Reference of the Audit Committeeincluded reviewing the adequacy and effectiveness of theinternal control environment monitoring implementationof the action plans emerging out of Internal Audit findingsincluding those relating to strengthening of your Companyrsquosrisk management systems and discharge of statutorymandate
HUMAN RESOURCE DEVELOPMENT
Your Company firmly believes that employees are the vitaland most valuable assets and hence has created afavourable work environment that encourages innovationand meritocracy Your Company continues to innovate inthe way human resources are managed and developedstriking a balance between business needs and individualaspirations
With an undying commitment to render delightful servicesyour Companyrsquos employees consistently work towardsdelivering flawless performance and are continuing todelight customers
The Company provides a safe secure inclusive and genderfriendly workplace The Company has put in placeGrievance Redressal Procedures and adopted a Policy onSexual Harassment as per the provisions of the SexualHarassment of W omen at W orkplace (PreventionProhibition and Redressal) Act 2013 and the Rules framedthereunder The Company has an Internal ComplaintsCommittee to ensure that grievances in this regard if anyare effectively addressed During the year under review nocomplaint relating to sexual harassment has beenreceived
WHISTLEBLOWER POLICY
The Companyrsquos W histleblower Policy encouragesDirectors and employees to bring to the Companyrsquosattention instances of unethical behavior actual orsuspected incidents of fraud actual or suspectedinstances of leak of unpublished price sensitive informationor violation of the GHL Code of Conduct that could adverselyimpact the Companyrsquos operations business performanceand or reputation The Policy provides that the Companyinvestigates such incidents when reported in an impartialmanner and takes appropriate action to ensure that therequisite standards of professional and ethical conductare always upheld It is the Companyrsquos Policy to ensurethat no employee is victimised or harassed for bringingsuch incidents to the attention of the Company
The practice of the Whistleblower Policy is overseen by theAudit Committee and no employee has been denied accessto the Committee The Whistleblower Policy is available onthe Companyrsquos website at httpwwwgujarathotelsltdinCorporateGovernancehtml
DEPOSITS
Your Company has not accepted any deposits from thepublic members under Section 73 of the Companies Act2013 (lsquothe Actrsquo) read with the Companies (Acceptance ofDeposits) Rules 2014 during the year
DIRECTORS
Changes in Directors
Mr R C Mehta stepped down as Non-Executive IndependentDirector of the Company with effect from close of work on31st March 2019 keeping in view the Regulation 17(1A) ofthe Listing Regulations 2015 Your Directors would like torecord their appreciation for the services rendered byMr Mehta
The Board at the meeting held on 15th April 2019 on therecommendation of the Nominations and RemunerationCommittee recommended for the approval of the Membersthe re-appointment of Mr C K Koshy and Mr M Narayananas independent directors of your Company in terms ofSection 149 of the Act and Regulation 17 of the ListingRegulations 2015 with effect from 29th September 2019
Requisite Notices under Section 160 of the Act have beenreceived in respect of Messrs Koshy and Narayanan whohave filed their consents to act as Directors of the Companyif appointed
Appropriate resolutions seeking your approval to theaforesaid appointment will appear in the Notice conveningthe Thirty Seventh AGM of your Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
23
Retirement by Rotation
In accordance with the provisions of Section 152 of the Actread with Article 147 of the Articles of Association of theCompany Mr Jagdish Singh will retire by rotation at theensuing Annual General Meeting (lsquoAGMrsquo) of your Companyand being eligible offers himself for re-election Your Boardrecommends his re-election
Number of Board Meetings
During the year ended 31st March 2019 four meetings ofthe Board were held
Attributes Qualifications amp Independence of Directorsand their Appointment
As reported last year the Nominations and RemunerationCommittee of the Board had approved the criteria fordetermining qualifications positive attributes andindependence of Directors in terms of the Act and the Rulesthereunder both in respect of Independent Directors andother Directors as applicable The criteria inter aliarequires that NonndashExecutive Directors includingIndependent Directors be drawn from amongst eminentprofessionals with experience in business finance law public administration and enterprises
The Board Diversity Policy of the Company requires theBoard to have a balance of skills experience and diversityof perspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the lsquoReport on CorporateGovernancersquo forming part of the Report and Accounts TheArticles of Association of the Company provide that thestrength of the Board shall not be fewer than three normore than twelve
Directors are appointed re-appointed with the approval ofthe Members All Directors other than IndependentDirectors are liable to retire by rotation unless otherwiseapproved by the Members One-third of the Directors whoare liable to retire by rotation retire every year and areeligible for re-election
The Independent Directors of your Company haveconfirmed that (a) they meet the criteria of independenceas prescribed under Section 149 of the Act and Regulation16 of the Listing Regulations 2015 and (b) they are notaware of any circumstance or situation which could impairor impact their ability to discharge duties with an objectiveindependent judgement and without any external influenceFurther in the opinion of the Board the IndependentDirectors fulfil the conditions prescribed under the ListingRegulations 2015 and are independent of the managementof the Company
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpw w wg u j a ra th o te ls l td in p o l i c ies R em u n era t io n -
Policy_GHLpdf There has been no change in the Policyduring the year
Board Evaluation
The Nominations and Remuneration Committee hasapproved the Policy on Board Evaluation Evaluation ofBoard Committeesrsquo functioning and individual DirectorEvaluation and also specified that such evaluation will bedone by the Board Board performance is assessed againstthe role and responsibilities of the Board as provided inthe Act and the Listing Regulations 2015 The parametersfor Board performance evaluation have been derived fromthe Boardrsquos core role of trusteeship to protect and enhanceshareholder value as well as fulfil expectations of otherstakeholders through strategic supervision of the CompanyEvaluation of functioning of Board Committees is basedon discussions amongst Committee members and sharedby each Committee Chairman with the Board IndividualDirectors are evaluated in the context of the role played byeach Director as a member of the Board at its meetingsand in assisting the Board in realising its role of strategicsupervision of the functioning of the Company in pursuit ofits purpose and goals
While the Board evaluated its performance against theparameters laid down by the Nominations andRemuneration Committee the evaluation of individualDirectors was carried out anonymously in order to ensureobjectivity The Board was briefed on functioning of BoardCommittees by the respective Committee Chairmen
Key Managerial Personnel
Mr Deependra Rana resigned as the Chief Executive Officerof the Company with effect from 17th December 2018
The Board at the meeting held on 30th January 2019 onthe recommendation of the Nominations andRemuneration Committee appointed Mr Kunal Pahwa asthe Chief Executive Officer of the Company with effect from1st February 2019
AUDIT COMMITTEE amp AUDITORS
The composition of the Audit Committee is provided underthe section lsquoBoard of Directors amp Committeesrsquo in the Reportand Accounts
Statutory Auditors
The Statutory Auditors Messrs K C Mehta amp Co CharteredAccountants (KCM) were appointed with your approval atthe Thirty Fifth AGM to hold such office till the conclusion ofthe Fortieth AGM
On the recommendation of the Audit Committee the Boardrecommended for the approval of the Members paymentof remuneration of KCM for the financial year 2019-20Appropriate resolution for this purpose will appear in theNotice convening the Thirty Seventh AGM of the Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
24
Secretarial Auditors
Your Board appointed Messrs PB amp Associates CompanySecretaries to conduct the secretarial audit of the Companyfor the financial year ended 31st March 2019 Their Reportis provided in the Annexure forming part of this Report interms of Section 204 of the Act
RELATED PARTY TRANSACTIONS
All contracts or arrangements entered into by the Companywith its related parties during the financial year were inaccordance with the provisions of the Act and the ListingRegulations 2015 All such contracts or arrangements wereentered in the ordinary course of business and on armrsquoslength basis and have been approved by the AuditCommittee
Further the details of related party transactions of theCompany in prescribed Form No AOC-2 in terms of Section134 of the Act read with Rule 8 of the Companies (Accounts)Rules 2014 is given in the Annexure to this Report YourCompanyrsquos Policy on Related Party Transactions asadopted by your Board can be accessed on the website ath t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_Transactionspdf
DIRECTORSrsquo RESPONSIBILITY STATEMENT
As required under Section 134 of the Act your Directorsconfirm having
a) followed in the preparation of the Annual Accounts theapplicable Accounting Standards with properexplanation relating to material departures if any
b) selected such accounting policies and applied themconsistently and made judgements and estimates thatare reasonable and prudent so as to give a true andfair view of the state of affairs of your Company at theend of the financial year and of the profit of yourCompany for that period
c) taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with theprovisions of the Act for safeguarding the assets ofyour Company and for preventing and detecting fraudand other irregularities
d) prepared the Annual Accounts on a going concernbasis
e) laid down internal financial controls to be followed byyour Company and that such internal financial controlswere adequate and operating effectively and
f) devised proper systems to ensure compliance withthe provisions of all applicable laws and that suchsystems were adequate and operating effectively
OTHER INFORMATION
Compliance with the conditions of Corporate Governance
The certificate of the Statutory Auditors Messrs K C Mehtaamp Co Chartered Accountants confirming compliance withthe conditions of Corporate Governance as stipulated underthe Listing Regulations 2015 is annexed
Compliance with Secretarial Standards
The Company is in compliance with the applicableSecretarial Standards issued by the Institute of CompanySecretaries of India and approved by the CentralGovernment under Section 118 of the Act
Cost Records
The Company is not required to maintain cost records interms of Section 148 of the Act read with the Companies(Cost Records and Audit) Rules 2014
Going Concern Status
There is no significant or material order passed during theyear by any regulator court or tribunal impacting the goingconcern status of the Company or its future operations
Extract of Annual Return
The information required under Section 134 of the Act readwith Rule 12 of the Companies (Management andAdministration) Rules 2014 is annexed
Particulars of Loans Guarantees or Investments
During the year ended 31st March 2019 the Company hasneither given any loan or guarantee nor has made anyinvestment under the provisions of Section 186 of the Act
Particulars relating to Conservation of Energy andTechnology Absorption
Particulars as required under Section 134 of the Act relatingto Conservation of Energy and Technology Absorption areprovided below-
Conservation of Energy
Steps taken on conservation of energy and impact thereof
Sl DescriptionNo
1 Installation of energy efficient Gas Burners and Induction Cooker
2 Improvement in energy usage efficiency in lighting system by changingover to efficient lighting solutions such as Light Emitting Diodes
3 Replacement of existing motors and pumps with more energy efficientequipment
4 Process improvement to enhance productivity and reduce specificenergy consumption
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
25
There were no employees who were employed throughoutthe year and were in receipt of remuneration aggregating` 102 crores or more or were employed for part of the yearand were in receipt of remuneration aggregating ` 850lakhs per month or more during the financial year ended31st March 2019
The information pursuant to Section 197 of the Act readwith Rule 5(2) and 5(3) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014containing the names of top 10 employees in terms ofremuneration drawn is provided in the Annexure formingpart of this report
The information required under Section 197(12) of the Actand the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is provided in theAnnexure forming part of this Report
FORWARD-LOOKING STATEMENTS
This Report contains forward-looking statements thatinvolve risks and uncertainties When used in this Reportthe words lsquoanticipatersquo lsquobelieversquo lsquoestimatersquo lsquoexpectrsquo lsquointendrsquolsquowillrsquo and other similar expressions as they relate to theCompany and or its Businesses are intended to identifysuch forward-looking statements The Companyundertakes no obligation to publicly update or revise anyforward-looking statements whether as a result of newinformation future events or otherwise Actual resultsperformances or achievements could differ materially fromthose expressed or implied in such forward-lookingstatements Readers are cautioned not to place unduereliance on these forward-looking statements that speakonly as of their dates This Report should be read inconjunction with the financial statements included hereinand the notes thereto
CONCLUSION
Your Directors and employees look forward to the futurewith confidence and stand committed to creating an evenbrighter future for all stakeholders
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
Steps taken by the Company for utilising alternate sourcesof energy NIL
Capital investment on energy conservation equipment NIL
Technology Absorption
i) Efforts in brief made towards technology absorptionand benefits derived as a result of the above effortseg product improvement cost reduction productdevelopment import substitution etc
Sl Description BenefitsNo
1 Upgradation of Fire Alarm and For Product UpgradationPublic Announcement system
2 Installation of Hoods and Fire For Product UpgradationSuppression system
3 Upgradation of CCTV monitoring For Product Upgradationsystem
4 Upgradation of Electrical Panel For Product Improvement5 Induction of Diesel Generator For Product Improvement
ii) In case of imported technology (imported during thelast 3 years reckoned from the beginning of the financialyear) following information may be furnished
A) Details of technology imported - NIL
B) Year of import - NIL
C) Whether the technology has been fully absorbed -NIL
D) If not fully absorbed areas where absorption hasnot taken place and the reasons therefor - NIL
iii) Expenditure incurred on research and development -NIL
FOREIGN EXCHANGE EARNINGS AND OUTGO
During the financial year 2018-19 foreign exchangeearnings of the Hotel aggregated ` 111754 lakhs (previousyear ` 95887 lakhs) while expenditure in foreign currencyaggregated ` 5514 lakhs (previous year ` 3230 lakhs)
EMPLOYEES
The total number of employees of the Company as on31st March 2019 stood at 198
26
ANNEXURE
FORM NO MR ndash 3SECRETARIAL AUDIT REPORTFOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019[Pursuant to Section 204(1) of the Companies Act 2013 and Rule9 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014]
ToThe MembersGujarat Hotels LimitedWe have conducted the secretarial audit of the compliance ofapplicable statutory provisions and the adherence to goodcorporate practices by Gujarat Hotels Limited a Companyincorporated under the provisions of the Companies Act 1956 andhaving its Registered Office at WelcomHotel Vadodara R C DuttRoad Alkapuri Vadodara Gujarat ndash 390 007 (hereinafter referredto as the lsquoCompanyrsquo) for the period commencing from 1st April2018 till 31st March 2019 (hereinafter referred to as the lsquoAuditPeriodrsquo) Secretarial Audit was conducted in a manner that providedus a reasonable basis for evaluating the corporate conducts statutory compliances and expressing our opinions thereonBased on our verification of the books papers minute booksforms and returns filed and other records maintained by theCompany and also the information provided by the Company itsofficers agents and authorised representatives during the conductof Secretarial Audit 2018-19 we hereby report that in our opinionthe Company has during the audit period covering the FinancialYear ended on 31st March 2019 complied with the statutoryprovisions listed hereunder and also that the Company has properBoard-processes and compliance-mechanism in place to theextent in the manner and subject to the reporting made hereinafterWe have examined the books papers minute books forms andreturns filed and other records maintained by the Company for thefinancial year ended on 31st March 2019 according to theprovisions of(i) The Companies Act 2013 (the Act) and the Rules made
thereunder(ii) The Securities Contracts (Regulation) Act 1956 (lsquoSCRArsquo)
and the Rules made thereunder(iii) The Depositories Act 1996 and the Regulations and
Bye-laws framed thereunder(iv) Foreign Exchange Management Act 1999 and the Rules and
Regulations made thereunder to the extent of Foreign DirectInvestment Overseas Direct Investment and ExternalCommercial Borrowings
(v) The following Regulations and Guidelines prescribed underthe Securities and Exchange Board of India Act 1992(lsquoSEBI Actrsquo)-(a) The Securities and Exchange Board of India
(Substantial Acquisition of Shares and Takeovers)Regulations 2011
(b) The Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations 2015
(c) The Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations2015
(d) The Securities and Exchange Board of India(Registrars to an Issue and Share Transfer Agents)Regulations 1993 regarding the Companies Act anddealing with client
We have also examined compliance with the applicable clauses ofthe following(i) The mandatory Secretarial Standards issued by The Institute
of Company Secretaries of India with respect to BoardMeetings and General Meetings
(ii) The SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015
The Company has entered into an Operating Licence Agreementwith ITC Limited which operates the Hotel ndash WelcomHotel Vadodraand ensure compliance of all laws as applicable for running andmaintenance of the HotelDuring the period under review the Company has complied withthe provisions of the Act Rules Regulations Guidelines andStandards etc as mentioned above however in the CorporateGovernance Report filed pursuant to Regulation 27(2) of SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015with BSE for the quarter ended September and December 2018there is mismatch of date of the meetingWe further report thatThe Board of Directors of the Company is duly constituted withproper balance of Non-Executive Directors and IndependentDirectors The changes in the composition of the Board of Directorsthat took place during the period under review were carried out incompliance with provisions of the ActAdequate notice is given to all Directors for the Board Meetingsand Committees Meetings agenda and detailed notes on agendawere sent at least seven days in advance and where the meetingwas held in shorter notice due compliance was made and a systemexists for seeking and obtaining further information and clarificationson the agenda items before the meeting for meaningful participationat the meetingAll decisions at Board Meetings and Committee Meetings werecarried out unanimously as recorded in the minutes of the meetingsof the Board of Directors or Committees of the Board as the casemay beWe report that there are adequate systems and processes in theCompany commensurate with the size and operations of theCompany to monitor and ensure compliance with the applicableLaws Rules Regulations and GuidelinesWe further report that during the Audit Period the Company has nospecific events actions that have a major bearing on the Companyrsquosaffairs in pursuance of the above referred Laws RulesRegulations Guidelines Standards etc
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
Note This report is to be read with our letter of even date whichis annexed as Annexure A and forms an integral part of thisreport
27
FORM NO AOC-2[Pursuant to Section 134(3)(h) of the Companies Act 2013 and Rule 8(2) of the Companies (Accounts) Rules 2014]
Form for disclosure of particulars of contracts arrangements entered into by the Company with related parties referred to insub-section (1) of Section 188 of the Companies Act 2013 including certain arms length transactions under fourth proviso thereto
1 Details of contracts or arrangements or transactions not at arms length basis
a) Name(s) of the related party and nature of relationshipb) Nature of contracts arrangements transactionsc) Duration of the contracts arrangements transactionsd) Salient terms of the contracts or arrangements or transactions including the value if anye) Justification for entering into such contracts or arrangements or transactions NILf ) Date(s) of approval by the Boardg) Amount paid as advances if anyh) Date on which the special resolution was passed in general meeting as required under first proviso to Section 188
2 Details of material contracts or arrangement or transactions at arms length basis
a) Name(s) of the related party and nature of ITC Limited of which the Company is an Associaterelationship
b) Nature of contracts arrangements transactions Agreement for operating the Companyrsquos Hotel
c) Duration of the contracts arrangements Operating License Agreement (OLA) dated 24th September 1992 for an initialtransactions period of 30 years and renewable for another period of 30 years The OLA
emanated from the rehabilitation package agreed amongst Gujarat State GovtFinancial Institutions viz IFCI amp SBI and ITC in the year 1990
d) Salient terms of the contracts or arrangements The Company receives Licence fees 15 of Net Operating Income Valueor transactions including the value if any of transaction during the year ` 370 crores
e) Date(s) of approval by the Board if any 24th September 1992f ) Amount paid as advances if any Nil
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Annexure AToThe MembersGujarat Hotels Limited
Our report of even date is to be read along with this letter
1 Maintenance of secretarial record is the responsibilityof the management of the Company Our responsibilityis to express an opinion on these secretarial recordsbased on our audit
2 We have followed the audit practices and processesas were appropriate to obtain reasonable assuranceabout the correctness of the contents of the secretarialrecords The verification was done on the randomtest basis to ensure that correct facts are reflected insecretarial records We believe that the processesand practices we followed provide a reasonablebasis for our opinion
3 W e have not verified the correctness andappropriateness of financial records and books ofaccounts of the Company
4 W herever required we have obtained theManagement Representation about the complianceof Laws Rules and Regulations and happening ofevents etc
5 The compliance of the provisions of corporate andother applicable Laws Rules RegulationsStandards is the responsibility of management Ourexamination was limited to the verification ofprocedures on the random test basis
6 The Secretarial Audit Report is neither an assuranceas to the future viability of the Company nor of theefficacy or effectiveness with which the managementhas conducted the affairs of the Company
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
28
INDEPENDENT AUDITORSrsquo CERTIFICATE ON CORPORATE GOVERNANCE
INDEPENDENT AUDITORrsquoS CERTIFICATE ON CORPORATEGOVERNANCE
TO THE MEMBERS OF GUJARAT HOTELS LIMITED
1 We have examined the compliance of conditions ofCorporate Governance by Gujarat Hotels Limited (ldquotheCompanyrdquo) for the year ended on 31st March 2019as stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the Securities and Exchange Board ofIndia (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended(ldquoSEBI Listing Regulationsrdquo)
Managementrsquos Responsibility
2 The compliance of conditions of CorporateGovernance is the responsibility of the ManagementThis responsibility includes the designimplementation and maintenance of internal controland procedures to ensure the compliance with theconditions of the Corporate Governance stipulated inSEBI Listing Regulations
Auditorrsquos Responsibility
3 Our responsibility is limited to examining theprocedures and implementation thereof adopted bythe Company for ensuring the compliance of theconditions of the Corporate Governance It is neitheran audit nor an expression of opinion on the financialstatements of the Company
4 We have examined the books of account and otherrelevant records and documents maintained by theCompany for the purpose of providing reasonableassurance on the compliance with CorporateGovernance requirements by the Company
5 We have carried out an examination of the relevantrecords of the Company in accordance with theGuidance Note on Certification of CorporateGovernance issued by the Institute of CharteredAccountants of India (ldquothe ICAIrdquo) the Standards onAuditing specified under Section 143(10) of theCompanies Act 2013 in so far as applicable for the
purpose of this certificate and as per the GuidanceNote on Reports or Certificates for Special Purposesissued by the ICAI which requires that we comply withthe ethical requirements of the Code of Ethics issuedby the ICAI
6 W e have complied with the relevant applicablerequirements of the Standard on Quality Control (SQC)1 Quality Control for Firms that Perform Audits andReviews of Historical Financial Information and otherAssurance and Related Services Engagements
Opinion
7 Based on our examination of the relevant recordsand according to the information and explanationsprovided to us and representations provided by theManagement we certify that the Company hascomplied with the conditions of Corporate Governanceas stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the SEBI Listing Regulations asapplicable for the year ended 31st March 2019
8 W e state that such compliance is neither anassurance as to the future viability of the Companynor the efficiency or effectiveness with which theManagement has conducted the affairs of theCompany
Restrictions on Use
9 This Certificate is issued solely for the purpose ofcomplying with the aforesaid SEBI ListingRegulations and may not be suitable for any otherpurpose
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
29
ANNEXURE
FORM NO MGT-9EXTRACT OF ANNUAL RETURN
as on the Financial Year ended on 31st March 2019[Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the
Companies (Management and Administration) Rules 2014]
I REGISTRATION AND OTHER DETAILS
i) CIN L55100GJ1982PLC005408ii) Registration Date 7th August 1982iii) Name of the Company Gujarat Hotels Limitediv) Category Sub-Category of the Company Public company - Limited by sharesv) Address of the Registered office and contact details WelcomHotel Vadodara
R C Dutt Road AlkapuriVadodara 390 007Tel No 0265-233 0033E-mail ghlinvestorsyahoocoin
vi) Whether Listed Company Yesvii) Name Address and Contact details of MCS Share Transfer Agent Limited
Registrar and Transfer Agent if any F - 65 Okhla Industrial Area Phase - INew Delhi - 110 020Tel Nos (011) 4140 6149-52 4160 9386
II PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY
III PARTICULARS OF HOLDING SUBSIDIARY AND ASSOCIATE COMPANIES NIL
Sl No
Name and Description of main products services NIC Code of the products services
to total turnover of the Company
1 Hotel Services 55101 100
30
IV SHAREHOLDING PATTERN (Equity Share Capital Break-up as percentage of Total Equity)(i) Category-wise Shareholding
Category of Shareholders No of Shares held at the beginningof the year
No of Shares held at the endof the year
Changeduring the
year
A Promoters(1) Indiana) Individual HUF 0 0 0 0 0 0 0 0 0b) Central Govt 0 0 0 0 0 0 0 0 0c) State Govt(s) 0 0 0 0 0 0 0 0 0d) Bodies Corp 2033963 0 2033963 5370 2033963 0 2033963 5370 0e) Banks FI 0 0 0 0 0 0 0 0 0f ) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(1) 2033963 0 2033963 5370 2033963 0 2033963 5370 0(2) Foreigna) NRIs - Individuals 0 0 0 0 0 0 0 0 0b) Other - Individuals 0 0 0 0 0 0 0 0 0c) Bodies Corp 0 0 0 0 0 0 0 0 0d) Banks FI 0 0 0 0 0 0 0 0 0e) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(2) 0 0 0 0 0 0 0 0 0Total Shareholding of Promoter(A) = (A)(1)+(A)(2) 2033963 0 2033963 5370 2033963 0 2033963 5370 0B Public Shareholding1 Institutionsa) Mutual Funds 0 0 0 0 0 0 0 0 0b) Banks FI 0 100 100 0 100 100 c) Central Govt 0 0 0 0 0 0 0 0 0d) State Govt(s) 0 0 0 0 0 0 0 0 0e) Venture Capital Funds 0 0 0 0 0 0 0 0 0f ) Insurance Companies 0 0 0 0 0 0 0 0 0g) FIIs 10 0 10 0 0 0 h) Foreign Venture Capital Funds 0 0 0 0 0 0 0 0 0i) Others (specify) 0 0 0 0 0 0 0 0 0Sub-total (B)(1) 10 100 110 0 100 100 2 Non-Institutionsa) Bodies Corpi) Indian 300003 2200 302203 798 191626 2100 193726 511 (287)ii) Overseas 0 0 0 0 0 0 0 0 0b) Individualsi) Individual shareholders holding
nominal share capital upto` 1 lakh 774322 231562 1005884 2656 797094 203602 1000696 2643 (013)
ii) Individual shareholders holdingnominal share capital inexcess of ` 1 lakh 220814 0 220814 583 334765 0 334765 884 301
c) Others (specify)i) Non Resident Individuals 44288 71500 115788 306 45662 56700 102362 270 (036)ii) Investor Education and
Protection Fund AuthorityMinistry of Corporate Affairs 108753 0 108753 287 121903 0 121903 322 035
Sub-total (B)(2) 1448180 305262 1753442 4630 1491050 262402 1753452 4630 0Total Public Shareholding(B)=(B)(1)+ (B)(2) 1448190 305362 1753552 4630 1491050 262502 1753552 4630 0C Shares held by Custodian
for GDRs amp ADRs 0 0 0 0 0 0 0 0 0Grand Total (A+B+C) 3482153 305362 3787515 100 3525013 262502 3787515 100 0
Demat Physical Total of TotalShares
Demat Physical Total of TotalShares
ANNEXURE
31
1 Savi Portfolio Management Services LimitedAt the beginning of the year 122218 323Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 122218 323
2 Muktilal Ganulal PaldiwalAt the beginning of the year 82742 218Increase Decrease in Shareholding during the year06042018 220 001 82962 21913042018 250 001 83212 22001062018 927 002 84139 22215062018 700 002 84839 22427072018 412 001 85251 22505102018 1000 003 86251 22830112018 500 001 86751 22931122018 958 003 87709 23218012019 124 000 87833 23208022019 1070 003 88903 23501032019 467 001 89370 23615032019 1000 003 90370 23922032019 200 001 90570 24031032019 50 000 90620 240At the end of the year 90620 240
3 Taradevi Muktilal PaldiwalAt the beginning of the year 31628 084
(ii) Shareholding of Promoters (including Promoter Group)
(iii) Change in Promotersrsquo Shareholding (please specify if there is no change)
SlNo
Shareholders NameNo of
Shares of total
Sharesof the
Company
of Sharespledged
encumbered tototal Shares
No ofShares
of totalShares
of theCompany
of Sharespledged
encumbered tototal Shares
change inShareholding
during the year
1 ITC Limited 1733907 4578 Nil 1733907 4578 Nil Nil
2 Russell Investments Limited 300056 792 Nil 300056 792 Nil Nil
Shareholding at the beginning of the year Shareholding at the end of the year
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
(iv) Shareholding Pattern of top ten Shareholders (other than Directors Promoters and Holders of GDRs and ADRs)
ANNEXURE
No of Shares
Sl No
Particulars Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares of total Shares of the Company
No of Shares of total Shares of the Company
At the beginning of the year
No Change during the year Increase Decrease in Promoters Shareholding during the year
At the end of the year
32
Increase Decrease in Shareholding during the year06042018 180 000 31808 08413042018 53 000 31861 08420042018 1449 004 33310 08827042018 1933 005 35243 09304052018 1060 003 36303 09611052018 2196 006 38499 10218052018 1343 004 39842 10625052018 1191 003 41033 10906072018 1600 004 42633 11313072018 1678 004 44311 11720072018 2095 006 46406 12327072018 3735 010 50141 13303082018 415 001 50556 13410082018 685 002 51241 13624082018 1169 003 52410 13931082018 1616 004 54026 14307092018 1655 004 55681 14714092018 1311 003 56992 15021092018 2480 007 59472 15729092018 2259 006 61731 16305102018 1534 004 63265 16712102018 976 003 64241 17019102018 64 000 64305 17026102018 600 002 64905 17202112018 605 002 65510 17409112018 4 000 65514 17416112018 143 000 65657 17430112018 2299 006 67956 18007122018 515 001 68471 18114122018 10 000 68481 18121122018 590 002 69071 18331122018 600 002 69671 18504012019 1000 003 70671 18825012019 21 000 70692 18801022019 701 002 71393 19008022019 388 001 71781 19115022019 714 002 72495 19301032019 700 002 73195 19515032019 34 000 73229 195At the end of the year 73299 195
4 Shah Viren ShantilalAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 14122018 26965 071
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
ANNEXURE
33
Increase Decrease in Shareholding during theyear ie wef 1412201811012019 28946 076 55911 14701022019 7194 019 63105 166At the end of the year 63105 166
5 Chirayush Pravin VakilAt the beginning of the year 27482 073Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 27482 073
6 Falguni Nilesh DedhiaAt the beginning of the year 18000 048Increase Decrease in Shareholding during the year27042018 5175 014 23175 062At the end of the year 23175 062
7 Classic Realties Private LimitedAt the beginning of the year 23061 061Increase Decrease in Shareholding during the year31082018 100 000 23161 061At the end of the year 23161 061
8 Dheeraj Kumar LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 20000 053
9 Karvy Stock Broking LimitedAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 30112018 23063 061Increase Decrease in Shareholding during theyear ie wef 3011201807122018 149 000 23212 06114122018 (8165) (022) 15047 03931122018 7128 019 22175 05804012019 3087 008 25262 06611012019 (23721) (063) 1541 00331032019 15274 040 16815 043At the end of the year 16815 043 Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company Includes shares acquired during the period when not part of the top ten Shareholders of the Company
10 Sonal LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year20042018 (1000) (003) 19000 050
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
34
311218 0 000 0 00011012019 0 000 0 00031032019 (5000) (013) 14000 037At the end of the year 14000 037 Ceased to be part of the top ten Shareholders of the Company Became a part of the top ten Shareholders of the Company
11 Rajasthan Global Securities Private LimitedAt the beginning of the year 98659 260Increase Decrease in Shareholding during the year20042018 (4756) (013) 93903 24727042018 (5596) (015) 88307 23206072018 (790) (002) 87517 23027072018 (8520) (022) 78997 20802112018 (10975) (029) 68022 17916112018 (4) 000 68018 17930112018 (6189) (016) 61829 16307122018 (170) 000 61659 16314122018 (18503) (049) 43156 11421122018 (417) (001) 42739 11331122018 (11108) (029) 31631 08404012019 (5000) (013) 26631 07111012019 (5000) (013) 21631 05825012019 (2800) (007) 18831 05101022019 0 000 0 000At the end of the year NA NA Ceased to be a part of the top ten Shareholders of the Company
12 Dinesh Mukilal PaldiwalAt the beginning of the year 10522 028Increase Decrease in Shareholding during the year03082018 112 000 10634 02810082018 424 001 11058 02907092018 500 001 11558 03021092018 85 000 11643 03005102018 1000 003 12643 03302112018 0 000 12643 03301022019 0 000 12643 03315022019 300 001 12943 03431032019 0 000 12943 034At the end of the year NA NA Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company
Note Increase decrease in shareholding as indicated above are based on downloads of beneficial ownership provided by the Depositories generally everyFriday
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
35
(v) Shareholding of Directors and Key Managerial Personnel
ANNEXURE
Ms D R Choudhury Messrs C K Koshy R C Mehta M Narayanan and J Singh Directors Messrs M Agarwal andD K Gulati Key Managerial Personnel did not hold any Shares of the Company either at the beginning or at the end of theyear or at any time during the year
Mr K Pahwa Chief Executive Officer also did not hold any Shares of the Company either at the time of his appointment or atthe end of the year or at any time during the year
V INDEBTEDNESSIndebtedness of the Company including interest outstanding accrued but not due for payment NIL
VI REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNELA Remuneration to Managing Director Wholetime Directors and or Manager NOT APPLICABLE
B Remuneration to the other Directors(Amount in `)
Ceased to be Non-Executive Independent Director with close of work on 31st March 2019
Sl No For each of the Director
Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares held singly
jointly
of total Shares of the
Company
No of Shares held singly
jointly
of total Shares of the
Company
1 N Anand (Chairman)
At the beginning of the year 200 0
Increase Decrease in Shareholding during the year
0 0 0 0
At the end of the year 200 0
Sl No Directors
Particulars of Remuneration
Total Amount Fee for attending Board Board
Committee Meetings
Commission Independent Directors
Meeting Fees 1 Independent Directors
C K Koshy 140000 0 10000 150000 R C Mehta 70000 0 0 70000 M Narayanan 140000 0 10000 150000
Total (B)(1) 350000 0 20000 370000 2 Other Non-Executive Directors
N Anand 0 0 0 0 D R Choudhury 0 0 0 0 J Singh 0 0 0 0
Total (B)(2) 0 0 0 0 Total (B) = (B)(1) + (B)(2) 370000 Total Managerial Remuneration (A+B) 370000
Overall ceiling as per the Act (Being 11 of the Net Profits of the Company as calculated under Section 198 of the Companies Act 2013)
3759620
36
C Remuneration to Key Managerial Personnel other than MD Manager WTD(Amount in `)
Mr K Pahwa was appointed as Chief Executive Officer wef 1st February 2019
VII PENALTIES PUNISHMENT COMPOUNDING OF OFFENCES
against the Company Directors and other Officers in Default under the Companies Act 2013 NONE
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Sl No
Particulars of Remuneration Key Managerial Personnel
Total Amount
K Pahwa Chief Executive
Officer
M Agarwal Chief Financial
Officer
D K Gulati Company Secretary
1 Gross Salary
(a) Salary as per provisions contained in Section 17(1) of the Income-tax Act 1961
377472 2883242 880140 4140854
(b) Value of perquisites under Section 17(2) of the Income-tax Act 1961
242908 136154 0 379062
(c) Profits in lieu of salary under Section 17(3) of the Income-tax Act 1961
0 0 0 0
2 Stock Option 0 0 0 0 3 Sweat Equity 0 0 0 0 4 Commission
- as of profit - others specify
0 0 0 0
5 Others please specify 0 0 0 0 Total Amount 620380 3019396 880140 4519916
37
Services reverted to ITC Limited effective 17th December 2018 Reflects revision in remuneration effective 1st October 2018
Notes1 The number of permanent employees as on 31st March 2019 was 1982 Compared to 2017-18 the figures for 2018-19 reflect that
i) Median remuneration of employees - Increased by 965ii) Average remuneration of employees excluding Key Managerial Personnel (KMP) - Increased by 1040 with
increase in number of employeesiii) Remuneration of KMP - Increased by 1321 due to revision in remuneration during the year
3 Remuneration of Directors KMP and other employees is in accordance with the Companys Remuneration Policy
A Information pursuant to Section 197 of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014
Name of Directors ampKey ManagerialPersonnel
Designation Ratio of Remuneration toMedian Remuneration of
all employees
Increase inRemuneration over
LY ()
ANNEXURE
N Anand Non-Executive Chairman - -
D R Choudhury Non-Executive Director - -
C K Koshy Independent Director 0731 7
R C Mehta Independent Director 0341 -
M Narayanan Independent Director 0731 7
J Singh Non-Executive Director - -
D Rana Chief Executive Officer 12681 (15)
K Pahwa Chief Executive Officer (wef 1st February 2019) 3111 -
M Agarwal Chief Financial Officer 15281 24
D K Gulati Company Secretary 4371 8
38
O
n de
puta
tion
from
ITC
Lim
ited
(ITC
)
Ser
vice
s re
verte
d to
ITC
effe
ctiv
e 17
th D
ecem
ber
2018
N
otes
a
Gro
ss r
emun
erat
ion
incl
udes
sal
ary
var
iabl
e pa
y C
ompa
nys
con
tribu
tion
to p
rovi
dent
fun
d a
llow
ance
s amp
oth
er b
enef
its
app
licab
le p
erqu
isite
s ex
cept
pro
visi
ons
for
grat
uity
and
leav
e en
cash
men
t w
hich
are
act
uaria
lly d
eter
min
ed o
n an
ove
rall
Com
pany
bas
is
The
ter
m r
emun
erat
ion
has
the
mea
ning
ass
igne
d to
it
unde
r th
eC
ompa
nies
Act
20
13
bN
et r
emun
erat
ion
com
pris
es c
ash
inco
me
less
inc
ome
tax
amp e
duca
tion
cess
ded
ucte
d at
sou
rce
and
empl
oyee
s o
wn
cont
ribut
ion
to p
rovi
dent
fun
dc
All
appo
intm
ents
(ex
cept
in
case
of
empl
oyee
s on
dep
utat
ion)
are
con
tract
ual i
n ac
cord
ance
with
ter
ms
and
cond
ition
s as
per
Com
pany
s r
ules
d
The
afo
resa
id e
mpl
oyee
s ar
e ne
ither
rel
ativ
e of
any
Dire
ctor
of
the
Com
pany
nor
hol
d an
y eq
uity
sha
re i
n th
e C
ompa
ny
BIn
form
atio
n pu
rsua
nt t
o Se
ctio
n 19
7 of
the
Com
pani
es A
ct 2
013
read
with
Rul
es 5
(2)
and
5(3)
of
the
Com
pani
es (
App
oint
men
t an
dR
emun
erat
ion
of M
anag
eria
l Per
sonn
el) R
ules
201
4
On
beha
lf of
the
Boa
rd
Pla
ce
New
Del
hiD
R C
houd
hury
J S
ingh
Dat
e 1
5th
Apr
il 2
019
Dire
ctor
Dire
ctor
Desig
natio
nGr
oss
Rem
uner
atio
n(`
)
Net
Rem
uner
atio
n(`
)
Quali
ficat
ions
Date
ofco
mmen
ceme
ntof
empl
oym
ent
depu
tatio
n
Prev
ious
Em
ploy
men
t Po
sitio
n He
ld
34
56
78
9
Expe
rienc
e(Y
ears
)Na
meAg
e
12
Top
ten
empl
oyee
s in
term
s of r
emun
erat
ion
draw
nMa
yur A
garw
al33
Chief
Fina
ncial
Offic
er31
5115
622
2466
8B
Com
A
CA
9
2501
2017
ITC
Limite
dC
SMa
nage
r - Fi
nanc
eDe
epen
dra R
ana
38
Chief
Exe
cutiv
e Of
ficer
2615
119
1426
865
Dip
in Ho
tel
1625
0120
17IT
C Lim
ited
Mana
gmen
tGe
nera
l Man
ager
Deep
ak K
umar
Gula
ti33
Comp
any
Secr
etary
9017
4083
9928
BCo
m
AC
S
701
0720
15Re
ligar
e Sec
uritie
s Lim
ited
LLB
Ma
nage
r - C
ompli
ance
Rosh
an Ja
cob R
ajan
31As
sistan
t Man
ager
7366
8164
6118
BB
A P
GD
M
501
0320
18Th
e Fer
n Hote
l(M
arke
ting)
Sales
Man
ager
Kuna
l Pah
wa
37Ch
ief E
xecu
tive
Offic
er64
0997
2173
09Di
p in
Hote
l15
0102
2019
ITC
Limite
dMa
nagm
ent
Gene
ral M
anag
erSa
ikat S
engu
pta47
Exec
utive
4183
8535
8861
BCo
m
2613
0519
95Jin
dal H
otels
Limite
dFr
ont o
ffice A
ssist
ant
Rajar
am K
ashir
am B
abar
52Se
nior E
xecu
tive
4175
8231
7347
BCo
m
2201
1220
16Ho
tel K
avira
j Ex
ecuti
veVa
sund
hara
Son
awan
e52
Exec
utive
4010
0533
6903
HSC
Cer
tifica
te29
0104
1993
Nil
Cour
se in
Coo
kery
Vada
nsing
h Gum
ansin
gh55
Junio
r Ex
ecuti
ve38
9706
3139
72HS
C D
ip in
Hot
el38
0501
1994
Hotel
Ram
a-inn
Ra
nava
tMa
nagm
ent
Senio
r Cap
tain
Prav
in Ma
kwan
a56
Supe
rviso
r36
4111
3104
078th
Stan
dard
3410
0419
86Do
dsal
Comp
any
Weld
er
INFORMATION US 197 OF THE COMPANIES ACT 2013
39
CEO AND CFO COMPLIANCE CERTIFICATE
We Kunal Pahwa Chief Executive Officer and Mayur Agarwal Chief Financial Officer certify that
a) We have reviewed the financial statements including the cash flow statement for the year ended 31st March 2019 andto the best of our knowledge and belief
i) these statements do not contain any materially untrue statement or omit any material fact or contain statementsthat might be misleading
ii) these statements together present a true and fair view of the Companyrsquos affairs and are in compliance with IndianAccounting Standards applicable laws and regulations
b) To the best of our knowledge and belief no transactions entered into by the Company during the year ended31st March 2019 are fraudulent illegal or violative of the Companyrsquos code of conduct
c) We accept responsibility for establishing and maintaining internal controls for financial reporting and we have evaluatedthe effectiveness of the internal control systems of the Company pertaining to financial reporting Deficiencies in thedesign or operation of such internal controls if any of which we are aware have been disclosed to the auditors and theAudit Committee and steps have been taken to rectify these deficiencies
d) i) There has not been any significant change in internal control over financial reporting during the year underreference
ii) The changes in the Significant Accounting Policies arising from the adoption of the Indian Accounting Standardshave been discussed with the auditors and have been approved by the Audit Committee and
iii) We are not aware of any instance during the year of significant fraud with involvement therein of the managementor any employee having a significant role in the Companyrsquos internal control system over financial reporting
Place New Delhi Kunal Pahwa Mayur AgarwalDate 15th April 2019 Chief Executive Officer Chief Financial Officer
40
BALANCE SHEET
As at 31st March 2019Amount in `
Particulars Note As at As at31st March 2019 31st March 2018
ASSETSNon-Current Assetsa) Property Plant and Equipment 2 14695652 15623727b) Other Non-Current Assets 3 6672434 7609451Total Non-Current Assets 21368086 23233178Current Assetsa) Financial Assets
(i) Investments 4 280294894 208482957(ii) Trade Receivables 5 16310661 14154244(iii) Cash and Cash Equivalents 6 763039 900355(iv) Other Bank Balances 7 5489856 53182631(v) Other Financial Assets 8 4724316 6349124
b) Other Current Assets 3 437564 406324Total Current Assets 308020330 283475635Total Assets 329388416 306708813EQUITY AND LIABILITIESEquitya) Equity Share Capital 9 37875150 37875150b) Other Equity 268275037 243468594Total Equity 306150187 281343744LIABILITIESNon-Current Liabilitiesa) Provisions 10 1399224 1270990b) Deferred Tax Liabilities (Net) 11 10745247 11364002Total Non-Current Liabilities 12144471 12634992Current Liabilitiesa) Financial Liabilities
(i) Trade Payablesa) Total outstanding dues of micro enterprises and
small enterprises ndash ndashb) Total outstanding dues of creditors other than
micro enterprises and small enterprises 483074 395920(ii) Other Financial Liabilities 12 9272344 11118126
b) Other Current Liabilities 13 1264039 1172866c) Provisions 10 74301 43165Total Current Liabilities 11093758 12730077Total Equity And Liabilities 329388416 306708813
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
41
STATEMENT OF PROFIT AND LOSS
For the year ended 31st March 2019Amount in `
I Revenue From Operations 14 36986948 33098499
II Other Income 15 19625544 17119109
III Total Income (I+II) 56612492 50217608
IV EXPENSES
Employee Benefits Expense 16 1208580 1094609
Depreciation and Amortization Expense 473636 475984
Other Expenses 17 3107913 3334087
Total Expenses (IV) 4790129 4904680
V Profit Before Tax (III- IV) 51822363 45312928
VI Tax Expense
Current Tax 18 11653499 9272310
Deferred Tax 18 (618755) 2350502
VII Profit for the Year (V-VI) 40787619 33690116
VIII Other Comprehensive Income ndash ndash
IX Total Comprehensive Income for the Year (VII+VIII) 40787619 33690116
X Earnings per Equity Share (Face Value ` 10-each) 19
Basic (in `) 1077 890
Diluted (in `) 1077 890
For the Year For the YearParticulars Note ended ended
31st March 2019 31st March 2018
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
42
For the year ended 31st March 2019
STATEMENT OF CHANGES IN EQUITY
The Board of Directors of the Company recommended a dividend of ` 35 per share (for the year ended 31st March 2018 - dividend ` 350 pershare) be paid on fully paid equity shares This equity dividend is subject to approval by shareholders at the Annual General MeetingThe totalequity dividend to be paid ` 13256303 (for the year ended 31st March 2018 - dividend ` 13256303) Income tax on proposed dividend being` 2724873 (for the year ended 31st March 2018 - ` 2724873)
General Reserve This Reserve is created by an appropriation from one component of equity (generally retained earnings) to another notbeing an item of Other Comprehensive Income The same can be utilized by the Company in accordance with the provisions of the CompaniesAct 2013
Retained Earnings This Reserve represents the cumulative profits of the Company This Reserve can be utilized in accordance with theprovisions of the Companies Act 2013
The accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even dateOn behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
A Equity Share CapitalAmount in `
Balance as at the Changes in equity Balance at thebeginning of the share capital end of the
reporting year during the year reporting yearFor the year ended 31st March 2018 37875150 ndash 37875150For the year ended 31st March 2019 37875150 ndash 37875150
B Other EquityAmount in `
Reserves amp Surplus TotalGeneral Reserve Retained Earnings
Balance as at April 01 2017 30257504 195873461 226130965Total Comprehensive Income for the year ndash 33690116 33690116Dividend ndash 13256303 13256303Income Tax on Dividend Paid ndash 2698671 2698671Dividend Distribution Tax (earlier year) ndash 397513 397513Balance as at March 31 2018 30257504 213211090 243468594Balance as at April 01 2018 30257504 213211090 243468594Total Comprehensive Income for the year ndash 40787619 40787619Dividend ndash 13256303 13256303Income Tax on Dividend Paid 2724873 2724873Balance as at March 31 2019 30257504 238017533 268275037
43
CASH FLOW STATEMENT
For the year ended 31st March 2019
For the Year For the YearParticulars ended ended
31st March 2019 31st March 2018
NOTES1) The above Cash Flow Statement has been prepared under the ldquoIndirect Methodrdquo as set out in Ind AS 7Statement of Cash FlowsrdquoThe accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even date On behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
Amount in `
A Cash Flow from Operating ActivitiesPROFIT BEFORE TAX 51822363 45312928Adjustments for
Depreciation amp Amortisation expense 473636 475984Interest Income (1317822) (3453950)Dividend Income (159984) (178075)Loss on sale of property plant and equipment - Net 445778 (28273)Net gain(loss) on investments mandatorily measuredat fair value through profit or loss (18005340) (13358789)Other Non Operating Income ndash (86856)Other Non Operating Expense ndash 99378
OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 33258631 28782347Adjustments for
Trade Receivables Financial Assets and Other Assets (2815198) (90661)Trade Payables Other Liabilities and Provisions (1568800) 1700052
CASH GENERATED FROM OPERATIONS 28874633 30391738Income Tax Paid(Net) (10407981) (12740273)
NET CASH FROM OPERATING ACTIVITIES 18466652 17651465B Cash Flow from Investing Activities
Sale of Property Plant and Equipment 8661 58452Purchase of Current Investments (224340000) (186220000)SaleRedemption of Current Investments 170532754 183295529Dividend Income 159984 178075Interest Received 3262318 4031382
NET CASH FROM INVESTING ACTIVITIES (50376283) 1343438C Cash Flow from Financing Activities
Dividend Paid (13256303) (13256303)Income Tax on Dividend Paid (2724873) (2698671)
NET CASH FROM FINANCING ACTIVITIES (15981176) (15954974)NET INCREASE IN CASH AND CASH EQUIVALENTS (47890807) 3039929OPENING CASH AND CASH EQUIVALENTS 48653846 45613917CLOSING CASH AND CASH EQUIVALENTS 763039 48653846
CASH AND CASH EQUIVALENTS COMPRISE Cash cheques and current accounts 763039 900355Other Bank BalancesDeposits with original maturity more than 3 months having remainingmaturity less than 12 months from Balance Sheet date ndash 47753491
763039 48653846
44
1 SIGNIFICANT ACCOUNTING POLICIESStatement of ComplianceThese financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) notifiedunder section 133 of the Companies Act 2013 (the Act) read with Companies (Indian Accounting Standards)Rules 2015 (as amended) The financial statements have also been prepared in accordance with the relevantpresentation requirements of the Companies Act 2013
Basis of PreparationThe financial statements are prepared in accordance with the historical cost convention except for certain itemsthat are measured at fair values as explained in the accounting policies below The financial statements arepresented in Indian Rupees (INR) which is also the Companyrsquos functional currency
Fair Value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transactionbetween market participants at the measurement date regardless of whether that price is directly observable orestimated using another valuation technique In estimating the fair value of an asset or a liability the Companytakes into account the characteristics of the asset or liability if market participants would take those characteristicsinto account when pricing the asset or liability at the measurement date
The preparation of financial statements in conformity with Ind AS requires management to make judgementsestimates and assumptions that affect the application of the accounting policies and the reported amounts ofassets and liabilities the disclosure of contingent assets and liabilities at the date of the financial statementsand the reported amounts of revenues and expenses during the year Actual results could differ from those estimatesThe estimates and underlying assumptions are reviewed on an ongoing basis Revisions to accounting estimatesare recognised in the period in which the estimate is revised if the revision affects only that period they arerecognised in the period of the revision and future periods if the revision affects both current and future periods
All assets and liabilities have been classified as current or non-current as per the Companyrsquos normal operatingcycle and other criteria set out in the Schedule III to the Companies Act 2013 and Ind AS 1 ndash Presentation ofFinancial Statements based on the nature of business and the time between the acquisition of assets for processingand their realisation in cash and cash equivalents
Property Plant amp Equipment ndash Tangible AssetsProperty plant amp equipment are stated at cost of acquisition or construction less accumulated depreciation andimpairment if any For this purpose cost includes deemed cost which represents the carrying value of propertyplant and equipment recognised as at 1st April 2015 measured as per the previous GAAP
Cost is inclusive of inward freight duties and taxes and incidental expenses related to acquisition In respect ofmajor projects involving construction related pre-operational expenses form part of the value of assets capitalisedExpenses capitalised also include applicable borrowing costs for qualifying assets if any Subsequent costs areincluded in the assetrsquos carrying amount only when it meets the recognition criteria are met as per componentaccounting The carrying amount of a replaced part is derecognized All other repairs and maintenance are chargedto the statement of Profit amp Loss
An item of property plant and equipment is derecognized upon disposal or when no future economic benefits areexpected to arise from the continued use of asset Any gain or loss arising on the disposal or retirement of an itemof property plant and equipment is determined as the difference between the sales proceeds and the carryingamount of the asset and is recognised in Statement of Profit and Loss
Depreciation of these assets commences when the assets are ready for their intended use which is generally oncommissioning Items of Property Plant and Equipment are depreciated in a manner that depreciates the cost ofthe assets after commissioning (or other amount substituted for cost) less its residual value over their usefullives as specified in Schedule II of the Companies Act 2013 on a straight line basis
Property plant and equipmentrsquosrsquo residual values and useful lives are reviewed at each balance sheet date andchanges if any are treated as changes in accounting estimate
NOTES TO THE FINANCIAL STATEMENTS
45
NOTES TO THE FINANCIAL STATEMENTS
Useful lives of different class of PPE are as follows
Particulars Useful Life as per Schedule IIBuilding 60 Years
Plant and Equipment 15 Years
Furnitures and fixtures 8 years
Office equipment 5 Years
Impairment of AssetsImpairment loss is provided if any to the extent the carrying amount of assets or cash generating units exceedtheir recoverable amount
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amountmay not be recoverable
Recoverable amount is higher of an assetrsquos net selling price and its value in use Value in use is the present valueof estimated future cash flows expected to arise from the continuing use of an asset or cash generating unit andfrom its disposal at the end of its useful life
Impairment losses recognised in prior years are reversed when there is an indication that the impairment lossesrecognised no longer exist or have decreased Such reversals are recognised as an increase in carrying amountsof assets to the extent that it does not exceed the carrying amounts that would have been determined (net ofamortisation or depreciation) had no impairment loss been recognised in previous years
Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodiedin the asset are considered to modify the amortisation period or method as appropriate and are treated aschanges in accounting estimates
Financial instruments Financial Assets and Financial LiabilitiesFinancial assets and financial liabilities are recognized when the Company becomes a party to the contractualprovisions of the relevant instrument Transaction cost that are directly attributable to the acquisition or issue offinancial assets and financial liabilities (other than financial assets and financial liabilities measured at fair valuethrough profit or loss) are added to or deducted from the fair value on initial recognition of financial assets andfinancial liabilities Purchase or sale of financial assets that require delivery of assets within a time frame establishedby regulation or convention in the market place (regular way trades) are recognized on the trade date ie the datewhen the Company commits to purchase or sell the asset
Financial AssetsRecognition Financial assets includes Investments Trade receivable Advances Security Deposits Cash andcash equivalents Such Assets are initially recognized at transaction price when the company becomes party tocontractual obligations The transaction price includes transaction cost unless the assets is being fair valuedthrough the Statement of Profit and Loss
Classification Management determines the classification of an asset at initial recognition depending on thepurpose for which the assets were acquired The subsequent measurement of financial assets depends on suchclassification
Financial assets are classified as those measured at
(a) Amortised cost where the financial assets are held solely for collection of cash flows arising from payments ofprincipal and or interest
(b) Fair value through other comprehensive income (FVTOCI) where the financial assets are held not only forcollection of cash flows arising from payments of principal and interest but also from the sale of such assetsSuch assets are subsequently measured at fair value with unrealised gains and losses arising from changesin the fair value being recognised in other comprehensive income
46
NOTES TO THE FINANCIAL STATEMENTS
(c) Fair value through profit or loss (FVTPL) where the assets are managed in accordance with an approvedinvestment strategy that triggers purchase and sale decision based on fair value of such assets Such assetsare subsequently measured at fair value with unrealized gain and losses arising from changes in the fair valuebeing recognised in the Statement of Profit and Loss in the period in which they arise
Trade receivable Advances Security Deposits Cash and Cash equivalents etc are classified for measurementat amortised cost while Investment have been classified for measurement at Fair value through profit or loss(FVTPL)
Impairment The Company assesses at each reporting date whether a financial asset (or group of financialassets) such as investment trade receivable advances and security deposit held at amortised cost are tested forimpairment based on evidence or information that is available without undue cost or effort Expected credit lossesare assessed and loss allowances recognized if the credit quality of the financial asset has deteriorated significantlysince initial recognition
Reclassification When and only when the business model is changed the Company shall reclassify all affectedfinancial assets prospectively from the reclassification date as subsequently measured at amortised cost fairvalue through profit or loss without restating the previously recognized gains or losses and in terms of thereclassification principles laid down in the Ind AS relating to Financial Instruments
De-recognition Financial assets are derecognized when the rights to receive benefits have expired or beentransferred and the Company has transferred substantially all risks and rewards of ownership of such financialasset
Financial LiabilitiesTrade payables and other financial liabilities are initially recognized at the value of the respective contractualobligations They are subsequently measured at amortised cost
Financial liabilities are derecognized when the liability is extinguished that is when the contractual obligation isdischarged cancelled or expires
Offsetting Financial InstrumentsFinancial assets and liabilities are offset and the net amount is included in the Balance Sheet where there is alegally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis orrealise the asset and settle the liability simultaneously
Revenue1 Revenue is measured at the fair value of the consideration received or receivable for services rendered net of
discounts to customers and excludes taxes such as Goods and Services Tax Revenue from the sale ofservices is recognised when the Company performs its obligations to its customers and the amount of revenuecan be measured reliably and recovery of the consideration is probable Income from operating license fees arerecognized on accrual basis in accordance with Operating License agreement The timing of such revenuerecognition is in the periods in which such services are rendered
2 Interest Income is booked in the Statement of Profit and Loss using the effective interest method
3 Dividend Income is recognised in the Statement of Profit and Loss when the right to receive dividend is established
Employee BenefitsThe Company makes contributions to both defined benefit and defined contribution schemes
Contributions to Provident Fund are in the nature of defined contribution scheme and such paidpayable amountsare charged against revenue The contributions in respect of provident fund and family pension are statutorilydeposited with the Government
The Company also makes contribution to defined benefit gratuity plan The cost of providing benefits under thedefined benefit obligation is calculated by independent actuary using the projected unit credit method The Companyhas taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liability with respect to the
47
NOTES TO THE FINANCIAL STATEMENTS
employees and the premium paid to LIC is charged to Statement of Profit amp Loss The difference between theactuarial valuation of the gratuity with respect to employees at the year-end and the contribution paid to LIC isfurther adjusted in the books of accounts
Employees Benefit wrt Leave Encashment is considered as Employees Long Term Benefit for which the Companyrecords the liability based on actuarial valuation computed under projected unit credit method These benefits areunfunded
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee as per the Operating LicenseAgreement
Taxes on IncomeTaxes on income comprises of current tax and deferred tax Current tax in the Statement of Profit and Loss isprovided as the amount of tax payable in respect of taxable income for the period using tax rates and tax lawsenacted during the period together with any adjustment to tax payable in respect of previous years
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities andthe amounts used for taxation purposes (tax base) at the tax rates and tax laws enacted or substantively enactedby the end of the reporting period
Deferred tax assets are recognized for the future tax consequences to the extent it is probable that future taxableprofits will be available against which the deductible temporary differences can be utilized
Deferred tax assets and liabilities are offset when there is legally enforceable right to offset current tax assets andliabilities and when the deferred tax balances relate to the same taxation authority Current tax assets and taxliabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on netbasis or to realize the asset and settle the liability simultaneously
Dividend DistributionDividends paid (including income tax thereon) is recognised in the financial statements in the period in which inwhich the interim dividends are approved by the Board of Directors or in respect of the Companyrsquos final dividendfor the year when the same are approved by shareholders of the Company
Provisions and Contingent LiabilitiesProvisions are recognized when the Company has a present obligation (legal or constructive) as a result of a pastevent it is probable that an outflow of resources will be required to settle the obligation and the amount can bereliably estimated The amount so recognized is the best estimate of the consideration required to settle theobligation at the reporting date taking in to account the risks and uncertainties surrounding the obligation Adisclosure for a contingent liability is made when there is possible obligation or a present obligation that may butprobably will not require an outflow of resources Where there is possible obligation or a present obligation inrespect of which the likelihood of outflow of resources is remote no provision or disclosure is made
Use of Estimates and JudgementsThe key estimates and assumption used in the preparation of financial statements are set out below
Actuarial ValuationThe determination of Companyrsquos liability towards defined benefit obligation to employees is made through independentactuarial valuation including determination of amounts to be recognized in the Statement of Profit and Loss and inother comprehensive income Such valuation depend upon assumptions determined after taking into accountinflation seniority promotion and other relevant factors such as supply and demand factors in the employmentmarket Information about such valuation is provided in notes to the financial statements
ComparativesWhen required by Ind AS comparative figures have been adjusted to conform to changes in presentation for thecurrent financial year
48
2P
rope
rty
Pla
nt a
nd E
quip
men
tA
mou
nt i
n `
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
Gros
s Bl
ock
Depr
eciat
on
Amor
tisati
onNe
t Blo
ck
Parti
cula
rsWi
thdraw
alWi
thdraw
alWi
thdraw
alWi
thdraw
alAp
ril 1
and
Marc
h 31
an
dMa
rch
31
April
1Fo
r the
and
March
31
For t
hean
dMa
rch
31
Marc
h 31
Ma
rch
31
2017
Addi
tions
Adjus
tmen
t20
18Ad
ditio
nsAd
justm
ent
2019
2017
year
Adjus
tmen
t20
18ye
arAd
justm
ent
2019
2019
2018
Tang
ible
Ass
ets
Build
ing
161
88
565
-16
188
565
-2
668
831
592
168
29
561
564
759
84-1
432
140
473
636
290
5518
76
721
140
44
961
147
56
425
Plan
t and
Equ
ipmen
t7
637
0120
716
742
985
-2
047
935
381
92-
--
--
--
538
192
742
985
Furn
iture
and
Fixt
ures
1
278
845
584
122
300
-11
818
110
482
--
--
--
-1
104
821
223
00
Offic
e Eq
uipme
nt2
017
-2
017
--
201
7-
--
--
--
201
72
017
Tota
l1
708
216
7-
263
001
705
586
7-
483
494
165
72
373
956
156
475
984
-14
321
404
736
3629
055
187
672
11
469
565
21
562
372
7
Full
y de
prec
iated
ass
ets
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
49
NOTES TO THE FINANCIAL STATEMENTS
Amount in `Particulars As at 31st March 2019 As at 31st March 2018
Current Non-Current Current Non-Current3 OTHER ASSETS
Advances other than capital advancesSecurity Deposit- With Others 2328947 2328947- Statutory Authorities 200000Other Advances (prepaid expenses) 437564 ndash 406324 ndashAdvance Tax (Net of Provisions) 4143487 5280504TOTAL 437564 6672434 406324 7609451
4 Current investments (at fair value through profit or loss unless otherwise stated) Amount in `Sl Investments in Mutual Funds As at 31st March 2019 As at 31st March 2018No
Name of Plan Unquoted Unquoted1 DHFL Pramerica Ultra Short Term Fund Nil (2018 - 1040731248)
Units of ` 1000 each ndash 219455882 ICICI Prudential Banking amp PSU Debt Fund 1124750948 Units
(2018 - 1124750948) of ` 1000 each 23872614 224702743 ICICI Prudential Corporate Bond Fund 1241451718 Units
(2018 - 1241451718) of ` 1000 each 23712100 221226704 UTI Floating Rate Fund Short Term Fund 7749911 Units
(2018-7749911) of ` 100000 each 23474167 218899535 SBI Magnum Instacash Nil Units (2018-3177849) of ` 100000 each ndash 70220186 Aditya Birla Sun Life Floating Rate Fund-Long Term 274475933 Units
(2018-319824542) Units of ` 10000 each 63614941 686675207 Aditya Birla Sunlife Saving Fund 137924934 Units (2018-129174683)
Units of ` 10000 each 51171946 443649348 Kotak Savings Fund 1128273230 Units (2018-Nil) of ` 1000 each 33816154 ndash9 Reliance Liquid Fund 11416769 Units (2018- Nil) of ` 100000 each 51823115 ndash10 ICICI Prudential Liquid Fund 57413509 Units (2018- Nil) of ` 10000 each 8809857 ndash
Aggregate amount of unquoted Investments 280294894 208482957TOTAL 280294894 208482957
Amount in `As at As at
31st March 2019 31st March 20185 TRADE RECEIVABLES
Unsecured Considered Good 16310661 14154244TOTAL 16310661 14154244
6 CASH AND CASH EQUIVALENTS Balances with Banks
Current Accounts 760024 900355Cash on Hand 3015 ndashTOTAL 763039 900355 Cash and cash equivalents include cash on hand cheques drafts on hand cash at bank and deposits with banks with original maturityof 3 months or less
7 OTHER BANKS BALANCESEarmarked balances 5489856 5429140On Deposit Accounts ndash 47753491TOTAL 5489856 53182631
Represents deposits with original maturity of more than 3 months having remaining maturity of less than 12 months from the Balance Sheet date
50
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
8 OTHER FINANCIAL ASSETSInterest accrued on Deposits 158000 2210348Others - Unsecured considered good 4566316 4138776TOTAL 4724316 6349124
As at As at As at As at31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of ` (No of `
Shares) Shares)9 EQUITY SHARE CAPITAL
AuthorisedEquity Shares of ` 10- each 10000000 100000000 10000000 100000000Issued Subscribed and Paid upEquity Shares of ` 10- each fully paid 3787515 37875150 3787515 37875150
A) Reconciliation of the number of Equity Shares outstanding31st March 31st March
2019 2018As at the beginning of the year 3787515 3787515Add - Shares issued during the year ndash ndashLess -Shares bought back during the year ndash ndashAs at the end of the year 3787515 3787515
B) Shareholders holding more than 5 of the As at As at As at As atEquity Shares in the Company 31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of (No of
Shares) Shares)ITC Limited 1733907 4578 1733907 4578Russell Investments Limited 300056 792 300056 792
C) Rights Preferences and Restrictions attached to the Equity SharesThe Equity Shares of the Company having par value of ` 10 per share rank pari passu in all respects includingvoting rights and entitlement to dividend
D) There are no bonus issue or buy back of equity shares during the period of five years immediately preceding thereporting date
As at 31st March 2019 As at 31st March 2018Current Non-Current Current Non-Current
10 PROVISIONSProvision for Long Term Employee Benefits 74301 1399224 43165 1270990TOTAL 74301 1399224 43165 1270990
51
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
11 DEFERRED TAX LIABILITIES (NET)Deferred Tax Liabilities 10745247 11364002Total 10745247 11364002Movement in Deferred Tax LiabilitiesAssets Balances
For the year 2018-19 Balance as on Recognized in Balance as on1st April 2018 profit or loss 31st March 2019
Deferred Tax Liabilities in relation toOther timing differences
On Depreciation on PPE 4293876 (252926) 4040950On Gain on Investment at FVTPL 7070126 473819 7543945
Total Deferred Tax Liabilities 11364002 220893 11584895Deferred tax liabilities beforeMAT credit entitlement 11364002 220893 11584895Less MAT credit entitlement ndash 839648 839648Total Deferred Tax Liabilities (Net) 11364002 (618755) 10745247
For the year 2017-18 Balance as on Recognized in Balance as on1st April 2017 profit or loss 31st March 2018
Deferred Tax liabilitiesassets in relation toOther timing differences
On Depreciation on PPE 4383618 (89742) 4293876On Gain on Investment at FVTPL 4629882 2440244 7070126
Total Deferred Tax Liabilities (Net) 9013500 2350502 11364002
As at As at31st March 2019 31st March 2018
12 OTHER FINANCIAL LIABILITIES
Unpaid Dividend 5489856 5429140Employee Related 3782488 5688986TOTAL 9272344 11118126
13 OTHER CURRENT LIABILITIES
Statutory Liabilities 1264039 1172866TOTAL 1264039 1172866
52
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 201814 REVENUE FROM OPERATIONS
Operating License Fees 36986948 33098499TOTAL 36986948 33098499
15 OTHER INCOMEInterest Income- Deposit with Banks- Carried At Amortised Cost 1178600 3272160- Deposit Others 139222 181790Dividend Income on Investment measured at FVTPL 159984 178075Net Gain(Loss) on financial assets mandatorily measured at FVTPL 18005340 13358789Net Gain(Loss) on Disposal of Fixed Assets ndash 28273Other Non-Operating Income 142398 100022TOTAL 19625544 17119109
Includes 1120976- (2018 - 681882-) being net gain(loss) on sale of investments
16 EMPLOYEE BENEFITS EXPENSESalaries and Wages 42461991 38590070Contribution to Provident and Other Fund 4564892 3983444
47026883 42573514Less Recoveries madeReimbursements received (45818303) (41478905)TOTAL 1208580 1094609
17 OTHER EXPENSESAdvertising Sales Promotion 159768 158814Consultancy Professional fees 214842 253969Travelling amp Conveyance 810746 1096527Postage Telephone Stationery etc 366042 205049Miscellaneous Expenses 1556515 1619728TOTAL 3107913 3334087Miscellaneous expenses includes Auditors remuneration andexpenses Audit Fees 60000 60000Fees for other services 40000 ndash
18 INCOME TAX EXPENSESA Amount recognised in profit or loss
Current TaxIncome Tax for the Year 11504441 9481109Adjustments(Credits) related to previous year 149058 (208799)Total Current Tax 11653499 9272310Deferred TaxDeferred tax for the year 220893 2350502Mat Credit Entitlement (839648) ndashTotal Deferred Tax (618755) 2350502TOTAL 11034744 11622812
NOTES TO THE FINANCIAL STATEMENTSAmount in `
53
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 2018B Reconciliation of effective tax rate
Profit before tax 51822363 45312928Indian tax rate 2782 2755Income Tax expense calculated at 2782 (2018 2755) 14416981 12484845Effects ofndash Different tax rate on certain items (2922098) (756048)ndash Difference in taxable incomedeductible expense 9697 42609ndash Incomes that are not taxable in determining taxable profit (44508) (49064)Adjustments recognised in the current year in relation toCurrent tax of prior years (425328) (208799)Effect on deferred tax balances due to the change in income tax rate ndash 109269Income Tax recognised in profit or loss 11034744 11622812
The tax rate used for the year 2018-19 and 2017-18 reconciliations above is the corporate tax rate of 25 + surcharge 7 and education cess 4 (2017-18 3) payable on taxable profits under the Income Tax Act 1961
19 EARNINGS PER EQUITY SHAREProfit for the year 40787619 33690116Number of equity shares outstanding 3787515 3787515Basic and diluted earnings per share in (Face value ` 10- per share) 1077 890
20 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTSA The Company was allotted 8200 sq mtrs of land at Vadodara in 1984 and an additional land of 2548 sq mtrs
in 1988 at R C Dutt Road Alkapuri Vadodara through GIIC (Gujarat Industrial Investment Corporation) on sub-lease for a period 30 years on which the hotel Welcomhotel Vadodara was constructed Lease term of landadmeasuring 8200 Sq mtrs expired on 30092014 and of land admeasuring 2548 sq mtrs expired on 30112018
The High Court of Gujarat in pursuance of Writ petition filed by Company in April 2013 passed an Order onDecember 24 2014 restraining the State Government from disturbing the peaceful and actual possession ofthe Company over the hotel property in any manner The writ petition is pending for hearing
The Company have made necessary application to State Government for Conversion of land from Leasehold toFreehold or Extension of Lease which is in process
B There are no Micro Small and Medium Enterprises to whom the Company owes dues which are outstandingfor more than 45 days during the year and also as at 31st March 2019 This information as required to bedisclosed under the Micro Small and Medium Enterprises Development Act 2006 has been determined tothe extent such parties have been identified on the basis of information available with the Company
C The Company operates in one segment ie Hoteliering and within one geographical segment ie India
D Defined Benefit Plan
The Company has taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liabilitywith respect to the employees and the premium paid to LIC is charged to Statement of Profit amp Loss Thedifference between the actuarial valuation of the gratuity with respect to employees at the year-end and thecontribution paid to LIC is further adjusted in the books of accounts
The accounting charge for benefits under the defined benefit obligation is calculated by independent actuaryusing the projected unit credit method
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee (ITC Limited) as per theOperating License Agreement hence no effect on Statement of Profit amp Loss and Other Comprehensive
54
NOTES TO THE FINANCIAL STATEMENTS
Income
Risk ManagementThe defined Benefit Plan expose the company to risk of actuarial deficit arising out of investment risk interestrate risk and salary cost inflation riskInvestment Risks This may arise from volatility in asset values due to market fluctuations and impairment ofassets due to credit losses These Plans primarily invest in debt instruments such as Government securitiesand highly rated corporate bonds ndash the valuation of which is inversely proportional to the interest rate movementsInterest Rate Risk The present value of Defined Benefit Plans liability is determined using the discount ratebased on the market yields prevailing at the end of reporting period on Government bonds A decrease inyields will increase the fund liabilities and vice-versaSalary Cost Inflation Risk The present value of the Defined Benefit Plan liability is calculated with referenceto the future salaries of participants under the Plan Increase in salary due to adverse inflationary pressuresmight lead to higher liabilitiesThese Plans have a relatively balanced mix of investments in order to manage the above risks The investmentstrategy is designed based on the interest rate scenario liquidity needs of the Plans and pattern of investmentas prescribed under various statutes
(Amount in `) Particulars Gratuity 2018-19 2017-18
I Components of Defined Benefit Cost 31-03-2019 31-03-2018 Recognised in Profit or Loss a Current Service Cost 641829 519816 b Past Service Cost ndash
c Net Interest Cost (184109) (72060) Remeasurements a Effect of changes in demographic assumptions (2108) ndash b Effect of changes in financial assumptions ndash (546692) c Effect of experience adjustments (142950) (700483) d (Return) on plan assets (excluding interest income) 24103 110903 e Changes in asset ceiling (excluding interest income) ndash ndash f Total remeasurements included in OCI (169160) (1358078)
Total defined benefit cost recognized in PampL 288560 (910323)I I Net Assets (Liabilities) recognised in Balance Sheet 31-03-2019 31-03-2018
1 Defined Benefit Obligation at end of period 11112243 102978642 Fair value of plan assets at end of period 13058222 120087733 Net defined benefit liability (asset) (1945979) (1710909)
III Change in Defined Benefit Obligation 31-03-2019 31-03-20181 Defined benefit obligation at beginning of period 10297864 111006822 Current service cost 641829 5198163 Interest expenses 755904 7223694 Remeasurements gains (losses)
a Effect of changes in demographic assumptions (2108) ndashb Effect of changes in financial assumptions ndash (546692)c Effect of experience adjustments (142950) (700483)
5 Benefits Paid (438296) (797828)6 Present Value of DBO at end of the year 11112243 10297864
IV Change in Fair Value of Plan Assets 31-03-2019 31-03-20181 Fair value of plan assets at beginning of period 12008773 11529880
55
NOTES TO THE FINANCIAL STATEMENTS
2 Interest income 940012 7944303 Actual Company Contributions 523630 3713884 Benefits Paid (438296) (797828)5 Remeasurements Gains(Losses) on plan assets 24103 1109036 Fair Value of Plan Assets at end of period 13058222 12008773
V Significant Actuarial Assumptions 31-03-2019 31-03-20181 Discount rate () 750 7502 Salary increase rate 70 703 Attrition Rate 20 204 Retirement Age 58 585 Pre-retirement Mortality Indian Assured Indian Assured
Lives Mortality Lives Mortality(2012-14) Ultimate (2006-08) Ultimate
6 Disability Nil NilVI Sensitivity Analysis
The below sensitivity analysis are based on a change in an assumption while holding all other assumptionsconstant In practice this is unlikely to occur and changes in some of the assumptions may be correlatedWhen calculating the sensitivity of the defined benefit obligation to significant actuarial assumptionsthe same method (present value of the defined benefit obligation calculated with the projected unit creditmethod at the end of the reporting period) has been applied as when calculating the defined benefitliability recognised in the balance sheet The methods and types of assumptions used in preparing thesensitivity analysis did not change compared to the prior period
DBO as at DBO as at31-03-2019 31-03-2018
1 Discount rate +100 basis points 10484869 96707062 Discount rate -100 basis points 11804923 109908143 Salary Increase Rate +1 11746789 109364544 Salary Increase Rate -1 10525722 97077345 Attrition Rate +1 11127835 103179616 Attrition Rate -1 11095064 10276102
Maturity Analysis of the Benefit Payments 31-03-2019 31-03-2018 Year 1 804294 399061 Year 2 1117591 769443 Year 3 558914 1211853 Year 4 2204073 512504 Year 5 1303903 2056016 Next 5 years 4323660 4603103
E Amount towards Defined Contribution Plans have been recognized under Contribution to Provident and OtherFunds in Note 16 ` 4564892- (2018 - ` 3983444-)
F The financial statements were approved for issue by the Board of Directors on 15th April 2019G Company has adopted IND As 115 lsquoRevenue from Contracts with Customersrsquo wef 01st April 2018 on prospective
basis and there is no material impact on Financial StatementsH Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Second
Amendment Rules 2019 on 30th March 2019 notifying new Standard Ind AS 116 lsquoLeasesrsquo and otherconsequential amendment in existing Ind As This Ind AS is applicable for annual period beginning on or after01st April 2019 The company is in the process of analysing the impact of such amendment which are notexpected to be material
56
NOTES TO THE FINANCIAL STATEMENTS
21 Financial Instruments and Related DisclosuresI Capital Management
The Company does not have borrowing and aims at maintaining a strong capital base so as to maintain adequatesupply of funds towards future growth plans as a going concern
II Categories of Financial InstrumentsAmount in `
Particulars Note As at As at March 31 2019 March 31 2018
Carrying Fair Carrying FairValue Value Value Value
A Financial Assetsa) Measured at Amortised Cost
i) Cash and cash equivalents 6 763039 763039 900355 900355ii) Other bank balances 7 5489856 5489856 53182631 53182631iii) Trade Receivables 5 16310661 16310661 14154244 14154244iv) Other Financial Assets 8 4724316 4724316 6349124 6349124
Sub - total 27287872 27287872 74586354 74586354 b) Measured at Fair Value through Profit or Loss
i) Investment in mutual funds 4 280294894 280294894 208482957 208482957Sub - total 280294894 280294894 208482957 208482957
Total Financial Assets 307582766 307582766 283069311 283069311B Financial Liabilities
Measured at Amortised Costi) Trade Payables 483074 483074 395920 395920ii) Other Financial Liabilities 12 9272344 9272344 11118126 11118126Total Financial Liabilities 9755418 9755418 11514046 11514046
The carrying amounts of trade payables other financial liabilities cash and cash equivalents other bank balancestrade receivables and other financial assets are considered to be the same as their fair values due to their short termnatureFair value in Mutual fund has been considered as Level 1 as Hierarchy for the same are based on unadjusted pricesin active marketIII Financial Risk Management Objectives
The Company has a system-based approach to risk management anchored to policies and procedures andinternal financial controls aimed at ensuring early identification evaluation and management of key financialrisks (such as market risk credit risk and liquidity risk) that may arise as a consequence of its businessoperations as well as its investing activities Accordingly the Companyrsquos risk management framework has theobjective of ensuring that such risks are managed within acceptable and approved risk parameters in a disciplinedand consistent manner and in compliance with applicable regulation It also seeks to drive accountability in thisregardLiquidity RiskThe company has current assets aggregate to ` 308020330- (2018- ` 283475635) including CurrentInvestments Cash and cash equivalents and Other bank balances of ` 286547789- (2018- ` 262565943-)against an aggregate Current liability of ` 11093758- (2018- ` 12730077-) on the reporting dateFurther whilethe Companyrsquos total equity stands at ` 306150187- (2018- ` 281343744-) and it has no borrowings In suchcircumstances liquidity risk or the risk that the company may not be able to settle or meet its obligations as theybecome due does not existMarket RiskThe company invests in mutual fund schemes of leading fund houses Such investments are susceptible tomarket price risk that arise mainly from changes in interest rate which may impact the return and value of such
57
NOTES TO THE FINANCIAL STATEMENTS
investments However given the relatively short tenure of the underlying portfolio of the mutual fund schemes inwhich the company has invested such price risk is not significantCredit RiskCompanyrsquos deployment in financial instruments such as mutual funds and fixed deposit are made in high qualitypaperscounterparties The company has receivable balances with ITC Limited under the Operating ServiceAgreement which are generally short term in nature Accordingly the Company has concluded that no provisionfor expected credit loss is required
22 Related Party DisclosuresRelated Party Transactionsi) Name of related parties and nature of relationships
ITC Limited of which the Company is an Associateii) Key Management Personnel
Board of DirectorsN Anand Chairman amp Non-Executive DirectorJ Singh Non-Executive DirectorR C Mehta Non-Executive DirectorC K Koshy Non-Executive DirectorM Narayanan Non-Executive DirectorD R Choudhury Non-Executive Director
iii) Summary of transactions during the year Amount in `
Particulars ITC Limited Key ManagementPersonnel
2019 2018 2019 2018License Fees Received 43644599 38834172 ndash ndashPurchase of Services 364514 513635 ndash ndashRemuneration of Managers on Deputation Reimbursed 5916468 5236397 ndash ndashRecoveries of Contractual Remuneration(Including Mangers on Deputation) 53058539 51502148 ndash ndashExpenses Recovered 2168155 2400471 ndash ndashExpenses Reimbursed ndash 44604 ndash ndashDividend Payments 6068675 6068675 700 700Remuneration to Key Management Personnel- Directorrsquos Sitting Fees 370000 350000Balance amount recoverable 20865894 18292750 ndash ndashBalance amount payable ndash ndash ndash ndash
58
TO THE MEMBERS OFGUJARAT HOTELS LIMITED
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying financial statementsof Gujarat Hotels Limited (ldquothe Companyrdquo) which comprisethe Balance Sheet as at 31st March 2019 the Statement ofProfit and Loss including other comprehensive incomeStatement of Changes in Equity and Statement of CashFlows for the year then ended and notes to the financialstatements including a summary of significant accountingpolicies and other explanatory information (hereinafterreferred to as ldquothe financial statementsrdquo)
In our opinion and to the best of our information andaccording to the explanations given to us the aforesaidfinancial statements give the information required by theCompanies Act 2013 (ldquothe Actrdquo) in the manner so requiredand give a true and fair view in conformity with the IndianAccounting Standards specified under section 133 of theAct read with the Companies (Indian Accounting Standards)Rules 2015 as amended (lsquoInd ASrdquo) and other accountingprinciples generally accepted in India of the state of affairsof the Company as at 31 st March 2019 and totalcomprehensive income (comprising of profit and othercomprehensive income) changes in equity and its cashflows for the year ended on that date
Basis for Opinion
We conducted our audit of the financial statements inaccordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act Our responsibilities underthose Standards are further described in the AuditorrsquosResponsibilities for the Audit of the Financial Statementssection of our report We are independent of the Companyin accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financialstatements under the provisions of the Act and the Rulesmade thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements andthe Code of Ethics We believe that the audit evidence wehave obtained is sufficient and appropriate to provide abasis for our audit opinion
Key Audit Matters
Key audit matters are those matters that in our professionaljudgment were of most significance in our audit of thesefinancial statements of the current period These matterswere addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereonand we do not provide a separate opinion on these mattersWe have determined the matters described below to bethe key audit matters to be communicated in our report
INDEPENDENT AUDITORS REPORT
Information Other than the Financial Statements andAuditorrsquos Report Thereon
The Companyrsquos Board of Directors is responsible forpreparation of the other information The other informationcomprises the information included in the Boardrsquos Reportincluding Annexures to Boardrsquos Report ManagementDiscussion and Analysis Report on Corporate Governance
and Shareholderrsquos Information but does not include thefinancial statements and our auditorrsquos report thereon
Our opinion on the financial statements does not cover theother information and we do not express any form ofassurance conclusion thereon
In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing
Sr No
Key Audit Matter How our audit addressed the matter
1 Evaluation of uncertain legal position of leasehold land
(Refer note no 20A to the financial statements)
The lease period of land held by the Company has expired The Company has filed necessary writ petition with High Court of Gujarat in April 2013 which is still pending for adjudication The Company has also made necessary application to State Government for Conversion of land from Leasehold to Freehold or Extension of Lease which is in process This matter being sub-judice essentially involves significant judgement to determine the possible outcome and therefore we have considered it as a key audit matter
We performed the following substantive procedures
Obtained details of application made to State Government Obtained details of writ petition filed to the High Court of
Gujarat and order copy passed by the High Court of Gujarat restraining the State Government from disturbing the actual possession over the property
Obtained details of progress in the matter Discussed the case with the Companyrsquos legal advisor about
the possible outcomes Read the minutes of the board meetings
Based on the procedures described managementrsquos evaluation on the same is acceptable
59
so consider whether the other information is materiallyinconsistent with the financial statements or our knowledgeobtained in the audit or otherwise appears to be materiallymisstated
If based on the work we have performed we conclude thatthere is a material misstatement of this other informationwe are required to report that fact We have nothing to reportin this regard
Responsibilities of Management and Those Charged withGovernance for the Financial Statements
The Companyrsquos Board of Directors is responsible for thematters stated in section 134(5) of the Act with respect tothe preparation of these financial statements that give atrue and fair view of the financial position financialperformance including other comprehensive incomechanges in equity and cash flows of the Company inaccordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards(Ind AS) prescribed under section 133 of the Act
This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company andfor preventing and detecting frauds and other irregularitiesselection and application of appropriate accounting policies making judgments and estimates that are reasonableand prudent and design implementation andmaintenance of adequate internal financial controls thatwere operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to thepreparation and presentation of the financial statementsthat give a true and fair view and are free from materialmisstatement whether due to fraud or error
In preparing the financial statements management isresponsible for assessing the Companyrsquos ability tocontinue as a going concern disclosing as applicablematters related to going concern and using the goingconcern basis of accounting unless management eitherintends to liquidate the Company or to cease operationsor has no realistic alternative but to do so
The Board of Directors is also responsible for overseeingthe Companyrsquos financial reporting process
Auditorrsquos Responsibilities for the Audit of the FinancialStatements
Our objectives are to obtain reasonable assurance aboutwhether the financial statements as a whole are free frommaterial misstatement whether due to fraud or error andto issue an auditorrsquos report that includes our opinionReasonable assurance is a high level of assurance but isnot a guarantee that an audit conducted in accordance withSAs will always detect a material misstatement when itexists Misstatements can arise from fraud or error and areconsidered material if individually or in the aggregate they
could reasonably be expected to influence the economicdecisions of users taken on the basis of these financialstatements
As part of an audit in accordance with SAs we exerciseprofessional judgment and maintain professionalskepticism throughout the audit We also
bull Identify and assess the risks of materialmisstatement of the financial statements whetherdue to fraud or error design and perform auditprocedures responsive to those risks and obtain auditevidence that is sufficient and appropriate to providea basis for our opinion The risk of not detecting amaterial misstatement resulting from fraud is higherthan for one resulting from error as fraud may involvecollusion forgery intentional omissionsmisrepresentations or the override of internal control
bull Obtain an understanding of internal control relevantto the audit in order to design audit procedures thatare appropriate in the circumstances Under section143(3)(i) of the Act we are also responsible forexpressing our opinion on whether the Company hasadequate internal financial controls system in placeand the operating effectiveness of such controls
bull Evaluate the appropriateness of accounting policiesused and the reasonableness of accountingestimates and related disclosures made bymanagement
bull Conclude on the appropriateness of managementrsquosuse of the going concern basis of accounting andbased on the audit evidence obtained whether amaterial uncertainty exists related to events orconditions that may cast significant doubt on theCompanyrsquos ability to continue as a going concern Ifwe conclude that a material uncertainty exists we arerequired to draw attention in our auditorrsquos report tothe related disclosures in the financial statementsor if such disclosures are inadequate to modify ouropinion Our conclusions are based on the auditevidence obtained up to the date of our auditorrsquosreport However future events or conditions maycause the Company to cease to continue as a goingconcern
bull Evaluate the overall presentation structure andcontent of the financial statements including thedisclosures and whether the financial statementsrepresent the underlying transactions and events ina manner that achieves fair presentation
We communicate with those charged with governanceregarding among other matters the planned scope andtiming of the audit and significant audit findings includingany significant deficiencies in internal control that weidentify during our audit
INDEPENDENT AUDITORS REPORT
60
We also provide those charged with governance with astatement that we have complied with relevant ethicalrequirements regarding independence and tocommunicate with them all relationships and other mattersthat may reasonably be thought to bear on ourindependence and where applicable related safeguards
From the matters communicated with those charged withgovernance we determine those matters that were of mostsignificance in the audit of the financial statements of thecurrent year and are therefore the key audit matters Wedescribe these matters in our auditorrsquos report unless lawor regulation precludes public disclosure about the mattersor when in extremely rare circumstances we determinethat a matters should not be communicated in our reportbecause the adverse consequences of doing so wouldreasonably be expected to outweigh the public interestbenefits of such communication
Report on Other Legal and Regulatory Requirements
1 As required by the Companies (Auditorrsquos Report)Order 2016 (ldquothe Orderrdquo) issued by the CentralGovernment of India in terms of sub-section (11) ofsection 143 of the Act we give in ldquoAnnexure Ardquo astatement on the matters specified in paragraphs 3and 4 of the Order to the extent applicable
2 As required by Section 143(3) of the Act we reportthat
a we have sought and obtained all the information andexplanations which to the best of our knowledge andbelief were necessary for the purposes of our audit
b in our opinion proper books of account as requiredby law have been kept by the Company so far as itappears from our examination of those books
c the Balance Sheet the Statement of Profit and lossincluding other comprehensive income the Statementof Changes in Equity and the Statement of Cash Flowsdealt with by this Report are in agreement with thebooks of account
d in our opinion the aforesaid financial statementscomply with the Indian Accounting Standards (Ind AS)prescribed under Section 133 of the Act
e on the basis of the written representations receivedfrom the directors as on 31st March 2019 taken onrecord by the Board of Directors none of the directorsis disqualified as on 31st March 2019 from beingappointed as a director in terms of Section 164(2) ofthe Act
f with respect to the adequacy of the internal financialcontrols with reference to financial statements of theCompany and the operating effectiveness of suchcontrols refer to our separate report in ldquoAnnexure Brdquoand
g with respect to the other matters to be included in theAuditorrsquos Report in accordance with the requirementsof section 197(16) of the Act as amended theCompany has neither paid nor provided for anyremuneration to its directors during the year
h with respect to the other matters to be included in theAuditorrsquos Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules 2014 in ouropinion and to the best of our information andaccording to the explanations given to us
i the Company does not have any pendinglitigations which would impact its financialposition
ii the Company did not have any long-termcontracts including derivative contracts for whichthere were any material foreseeable losses
iii there has been no delay in transferringamounts required to be transferred to theInvestor Education and Protection Fund by theCompany
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
61
ANNEXURE A TO THE INDEPENDENT AUDITORrsquoS REPORT
The annexure referred to in our Independent AuditorrsquosReport to the members of Gujarat Hotels Limited (ldquotheCompanyrdquo) on the financial statements for the year ended31st March 2019 we report that
i (a) The Company has maintained proper recordsshowing full particulars including quantitativedetails and situation of fixed assets
(b) As explained to us the Company has a regularprogram of physical verification of fixed assetswhich in our opinion is reasonable The assetswhich were to be covered as per the saidprogram have been physically verified by themanagement during the year In our opinion andAccording to the information and explanationsgiven to us no material discrepancies werenoticed on such verification
(c) According to the information and explanationsgiven to us and on the basis of our examinationof the records of the Company the title deeds ofimmovable properties are held in the name ofthe Company with respect to land the Companyhas filed a writ petition with Gujarat High Courtseeking that the Gujarat State Government bedirected to take action on Companyrsquosapplication to have the leasehold land of theHotel Converted to freehold and transferred toCompany as per the existing government policyin this regard
ii The Company does not have any inventory andtherefore reporting under clause (ii) of the Order isnot applicable to the Company
iii The Company has not granted any loans secured orunsecured to Companies firms Limited LiabilityPartnerships or other parties covered in the registermaintained under section 189 of the Companies Act2013 and therefore reporting under clause (iii) of theOrder is not applicable to the Company
iv The Company has not given any loans guaranteesor security In respect of the Investments made in ouropinion and according to the information andexplanations given to us the Company has compliedwith the provisions of section 186 of the Act
v According to the information and explanations givento us the Company has not accepted any depositsduring the year from the public within the meaning ofprovisions of section 73 to 76 of the Companies Act2013 and the rules framed thereunder and thereforereporting under clause (v) of the Order is notapplicable to the Company
vi In our opinion and according to the information andexplanations given to us in view of Rule 3 of theCompanies (Cost Records and Audit) AmendmentsRules 2014 the maintenance of cost records undersub-section (1) of section 148 of the Companies Act2013 is not applicable to the Company and thereforereporting under clause (vi) of the Order is notapplicable to the Company
vii (a) According to the information and explanationsgiven to us the Company has been regular indepositing with appropriate authoritiesundisputed statutory dues including providentfund employeersquos state insurance income-taxvalue added tax goods and service tax cessand other statutory dues applicable to it Furtherno undisputed amounts payable in respect ofprovident fund employeersquos state insuranceincome tax value added tax goods and servicetax cess and any other statutory dues were inarrears as at 31st March 2019 for a period ofmore than six months from the date theybecome payable
(b) According to the information and explanationsgiven to us there are no dues of Income taxsales tax value added tax and goods andservice tax which have not been deposited onaccount of any dispute
viii The Company has not taken any loans or borrowingsfrom financial institutions banks and government orhas not issued any debentures and thereforereporting under clause (viii) of the Order is notapplicable to the Company
ix The Company has not raised moneys by way of initialpublic offer or further public offer (including debtinstrument) and term loans during the year andtherefore reporting under clause (ix) of the Order isnot applicable to the Company
x To the best of our knowledge and according toinformation and explanations given to us no materialfraud by the Company or on the Company by its officersor employees has been noticed or reported duringthe course of our audit
xi In our opinion and according to the information andexplanations given to us the Company has not paidor provided any managerial remuneration during theyear and therefore reporting under clause (xi) of theOrder is not applicable to the Company
xii The Company is not a Nidhi company and thereforereporting under clause (xii) of the Order is notapplicable to the Company
INDEPENDENT AUDITORS REPORT
62
xiii In our opinion and according to the information andexplanations given to us and based on ourexamination of the records of the Company alltransactions with the related parties are in compliancewith Section 177 and 188 of the Act where applicableand the details have been disclosed in the financialstatements as required by the applicable accountingstandards
xiv According to the information and explanations givento us the Company has not made any preferentialallotment or private placement of shares or fully orpartly convertible debentures during the year underreview and therefore reporting under clause (xiv) ofthe Order is not applicable to the Company
xv In our opinion and according to the information andexplanations given to us the Company has not
entered into any non-cash transactions with directorsor persons connected with directors and thereforereporting under clause (xv) of the Order is notapplicable to the Company
xvi The Company is not required to be registered undersection 45-IA of the Reserve Bank of India Act 1934
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
63
ANNEXURE ldquoBrdquo TO THE INDEPENDENT AUDITORSrsquo REPORT
(Referred to in paragraph 2(f) under lsquoReport on Other Legaland Regulatory Requirementsrsquo section of our report to theMembers of Gujarat Hotels Limited on the financialstatements of even date)
Report on the Internal Financial Controls with referenceto financial statements under Clause (i) of Sub-section 3of Section 143 of the Act
W e have audited the internal financial controls withreference to financial statements of Gujarat Hotels Limited(ldquothe Companyrdquo) as of 31st March 2019 in conjunction withour audit of the financial statements of the Company for theyear ended on that date
Managementrsquos Responsibility for Internal FinancialControls
The Companyrsquos management is responsible forestablishing and maintaining internal financial controlsbased on the internal control over financial reporting criteriaestablished by the Company considering the essentialcomponents of internal control stated in the Guidance Noteon Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountantsof India (ldquoICAIrdquo) These responsibilities include the designimplementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuringthe orderly and efficient conduct of its business includingadherence to companyrsquos policies the safeguarding of itsassets the prevention and detection of frauds and errorsthe accuracy and completeness of the accounting recordsand the timely preparation of reliable financial informationas required under the Act
Auditorsrsquo Responsibility
Our responsibility is to express an opinion on theCompanyrsquos internal financial controls with reference tofinancial statements based on our audit We conductedour audit in accordance with the Guidance Note on Audit ofInternal Financial Controls over Financial Reporting (theldquoGuidance noterdquo) and the Standards on Auditing issued byICAI and deemed to be prescribed under section 143(10)of the Companies Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the ICAIThose Standards and the Guidance Note require that wecomply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whetheradequate internal financial controls with reference tofinancial statements were established and maintained andif such controls operated effectively in all material respects
Our audit involves performing procedures to obtain auditevidence about the adequacy of the internal financialcontrols with reference to financial statements and their
operating effectiveness Our audit of internal financialcontrols with reference to financial statements includedobtaining an understanding of internal financial controlswith reference to financial statements assessing the riskthat a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal controlbased on the assessed risk The procedures selecteddepend on the auditorrsquos judgement including theassessment of the risks of material misstatement of thefinancial statements whether due to fraud or error
We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our auditopinion on the Companyrsquos internal financial controls withreference to financial statements
Meaning of Internal Financial Controls with reference tofinancial statements
A Companyrsquos internal financial controls with reference tofinancial statements is a process designed to providereasonable assurance regarding the reliability of financialreporting and the preparation of financial statements forexternal purposes in accordance with generally acceptedaccounting principles A Companyrsquos internal financialcontrols with reference to financial statements includesthose policies and procedures that (1) pertain to themaintenance of records that in reasonable detailaccurately and fairly reflect the transactions anddispositions of the assets of the Company (2) providereasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements inaccordance with generally accepted accounting principlesand that receipts and expenditures of the Company arebeing made only in accordance with authorisations ofmanagement and directors of the Company and (3) providereasonable assurance regarding prevention or timelydetection of unauthorised acquisition use or dispositionof the Companyrsquos assets that could have a material effecton the financial statements
Inherent Limitations of Internal Financial Controls withreference to financial statements
Because of the inherent limitations of internal financialcontrols with reference to financial statements includingthe possibility of collusion or improper managementoverride of controls material misstatements due to erroror fraud may occur and not be detected Also projections ofany evaluation of the internal financial controls withreference to financial statements to future periods aresubject to the risk that the internal financial control withreference to financial statements may become inadequatebecause of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate
INDEPENDENT AUDITORS REPORT
64
Opinion
In our opinion the Company has in all material respectsan adequate internal financial controls with reference tofinancial statements and such internal financial controlswith reference to financial statements were operatingeffectively as at 31st March 2019 based on the internalcontrol over financial reporting criteria established by theCompany considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal
INDEPENDENT AUDITORS REPORT
Financial Controls over Financial Reporting issued by theInstitute of Chartered Accountants of India
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
7
Actrsquo) and Regulation 17 of the Securities and ExchangeBoard of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (lsquoListing Regulations2015rsquo) as set out in the Resolutions relating to theirrespective re-appointment
The Committee and the Board are of the view that giventhe knowledge experience and performance of Mr Koshyand Mr Narayanan and contribution to the Board processesby them their continued association would benefit theCompany Declarations have been received from Mr Koshyand Mr Narayanan that they meet the criteria ofIndependence prescribed under Section 149 of the Act readwith the Companies (Appointment and Qualification ofDirectors) Rules 2014 and Regulation 16 of the ListingRegulations 2015 In the opinion of the Board Mr Koshyand Mr Narayanan fulfil the conditions specified in the Actthe Rules thereunder and the Listing Regulations 2015 forre-appointment as Independent Directors and they areindependent of the management of the Company Mr Koshyand Mr Narayanan will be entitled to sitting fees for attendingmeetings of the Board and its Committees
Consent of the Members by way of Special Resolution isrequired for re-appointment of Mr Koshy and Mr Narayananin terms of Section 149 of the Act Further pursuant toRegulation 17 of the Listing Regulations 2015 consent ofthe Members by way of Special Resolution is also requiredfor continuation of a Non-Executive Director beyond the ageof seventy five years During the proposed term ofre-appointment Mr Koshy and Mr Narayanan will attain theage of seventy five years on 12th February 2020 and1st July 2020 respectively The Special Resolutions under
Item No 6 and 7 once passed shall also be deemed asyour approval under the Listing Regulations 2015 forcontinuation of Mr Koshy and Mr Narayanan as IndependentDirectors beyond the age of seventy five years
Requisite Notices under Section 160 of the Act proposingthe re-appointment of Mr Koshy and Mr Narayanan havebeen received by the Company and consents have beenfiled by Mr Koshy and Mr Narayanan pursuant to Section152 of the Act
Additional information in respect of Mr Koshy andMr Narayanan pursuant to the Listing Regulations 2015and the Secretarial Standard on General Meetings isappearing in the Report and Accounts under the sectionslsquoYour Directorsrsquo and lsquoReport on Corporate GovernancersquoMr Koshy and Mr Narayanan do not hold any share in theCompany either in their individual capacity or on a beneficialbasis for any other person
Mr Koshy and Mr Narayanan and their relatives areinterested in the Special Resolutions relating to theirrespective re-appointment None of the other Directors andKey Managerial Personnel of the Company or theirrelatives is interested in these Special Resolutions
The Board recommends these Special Resolutions for yourapproval
By Order of the BoardGujarat Hotels Limited
Place New Delhi Jagdish SinghDate 15th July 2019 Director
8
ROUTE MAP
AGM VenueWelcomHotel VadodaraR C Dutt Road AlkapuriVadodara 390 007
9
N Anand
Nakul Anand (62) DIN 00022279 a Non-Executive Directorof the Company since 10th March 1998 was appointed asthe Chairman of the Company effective 21st March 2009He is an Executive Director on the Board of ITC Limited andholds responsibility for the Hospitality Travel amp Tourismand Lifestyle Retailing businesses of ITC
An Economics Honours Graduate from the Delhi Universitywith an AMP degree from the Bond University AustraliaAnand joined ITC Hotelsrsquo Management TrainingProgramme in 1978 He has also served as the ManagingDirector of erstwhile ITC Hotels Limited during the period2003-05
In a career that spans close to four decades Anand hasbeen acknowledged in the hotels and tourism industry forhis vision and commitment Leveraging the significantlearning of sustainable excellence within ITC he led theteam at ITC Hotels to pioneer the concept of lsquoResponsibleLuxuryrsquo in the hospitality industry securing LEEDreg Platinumcertifications for all ITC premium luxury hotels He hasformulated value-based strategies to create a uniquequality control model His dynamic leadership and passionfor the business is recognised and acknowledged by hispeers He has been a past President of the HotelAssociation of India and past Chairman of the CII NationalTourism Committee Anand is presently a member of theNational Tourism Advisory Council constituted by theMinistry of Tourism Government of India Chairman of theFederation of Associations in Indian Tourism amp Hospitalityand a Member of the Executive Committee of the HotelAssociation of India He is also a Member of the IndiandashSriLanka CEOs Forum Council Member amp ExecutiveCommittee Member of the National Culture Fund Ministryof Culture Government of India and a Member on the Boardof the International Tourism Partnership
Other Directorships
Name of the company Position
International Travel House Limited Chairman amp Non-Executive Director
Landbase India Limited Chairman amp Non-Executive Director
Fortune Park Hotels Limited Chairman amp Non-Executive Director
WelcomHotels Lanka (Private) Limited Chairman amp Non-Executive Director
Srinivasa Resorts Limited Vice Chairman amp Non-Executive Director
ITC Limited Executive Director
Bay Islands Hotels Limited Non-Executive Director
Maharaja Heritage Resorts Limited Non-Executive Director
Committee Membership of other companies
Name of the Committee Positioncompany
International Travel House Limited Nominations amp MemberRemuneration Committee
Landbase India Limited Audit Committee Member
Fortune Park Hotels Limited Corporate Social ChairmanResponsibility Committee
CK Koshy
Cheruvettolil Kochukoshy Koshy (74) DIN01478704 wasappointed as an Independent Non-Executive Director ofthe Company on 1st May 2007 He is Master of Arts inPolitical Science and Public Administration He joined theIndian Administrative Service in 1968 from the Gujarat Cadreand superannuated in February 2005
In a long career spanning over 38 years he has held severaleminent positions including those of Additional ChiefSecretary - Department of Revenue Industries and MinesTourism and Civil Aviation and Finance and PrincipalSecretary to the Chief Minister He served the Governmentof India as Joint Secretary amp Financial Advisor to theDepartment of Atomic Energy and as Executive Director ofNuclear Power Corporation of India Limited He has heldthe posts of Managing Director of the Tourism Corporationof Gujarat Sardar Sarovar Narmada Nigam Gujarat StateSmall Industries Corporation and Girinar Scooter LimitedHe was also the Joint Managing Director of the GujaratIndustrial Investment Corporation and Chairman of GujaratState Petroleum Corporation Limited Gujarat State PetronetLimited and Gujarat Energy Research and ManagementInstitute
Post retirement he has been a consultant to the Departmentfor International Development - UK the World Bank and tothe Department of Personnel and Administrative ReformsGovt of India He was appointed Professor Emeritus in thefaculty of Planning and Public Policy at CEPT UniversityAhmedabad and is an Advisor to both Indian School ofPetroleum and Energy New Delhi and University ofPetroleum and Energy Studies Dehradun Currently he isAdvisor at CEPT University and on the Board of Trustees ofAlliance Francaise Gujarat and GIAN an NGO whichencourages innovation at the grass root level
Koshy does not hold directorship of any other company
M Narayanan
Mahalinga Narayanan (74) DIN 00159288 was appointedas an Independent Non-Executive Director of the Companyon 10th January 2008 He is a post graduate in CommerceGraduate in Law Diploma Holder in Business Managementand holds certified Associated Membership of the Indian
YOUR DIRECTORS
10
Institute of Bankers He has rich experience of over fourdecades in Banking Project Finance Administration andrelated areas
Narayanan started his career with the Reserve Bank ofIndia in 1964 and moved over to the Bank of Baroda in1969 and continued till March 1985 During his tenure inBank of Baroda he worked in all departments of commercialbanking operation and was in-charge of large branches ofthe Bank In April 1985 he joined Industrial FinanceCorporation of India and held senior managementpositions In October 1997 he joined Tourism FinanceCorporation of India Limited as Managing Director and roseto the position of Chairman and Managing Director whichposition he held till his retirement in September 2006 Hewas conferred with ldquoUdyog Rattan Awardrdquo in the year 2005by the Institute of Economic Studies New Delhi
Other Directorships
Name of the company Position
Cox amp Kings Limited Independent DirectorTulip Star Hotels Limited Independent DirectorRoyale Indian Rail Tours Limited Independent DirectorPride Hotels Limited Chairman amp Independent Director
Committee Membership of other Companies
Name of the company Committee Position
Cox amp Kings Limited Audit Committee ChairmanRemuneration MemberCommittee
Pride Hotels Limited Audit Committee ChairmanRoyale Indian Rail Tours Limited Audit Committee Chairman
Tulip Star Hotels Limited Audit Committee Chairman
J Singh
Jagdish Singh (53) DIN 00042258 was appointed as aNon-Executive Director on the Board of the Company on16th April 2016 A Commerce Graduate and a CharteredAccountant Singh joined ITC Limited in the year 1990During these 26 years he has held various positions inthe finance function He started his career in Treasury andmoved as Corporate Accountant Commercial Manager atCigarette factory at Munger and Head of Finance at ITCEssentra Limited He was then the Head of Treasury
between 2005 and 2015 and is presently the Head ofFinance at ITCrsquos Hotels Division
Other DirectorshipsName of the company Position
International Travel House Limited Non-Executive DirectorFortune Park Hotels Limited Non-Executive DirectorBay Islands Hotels Limited Non-Executive DirectorSrinivasa Resorts Limited Non-Executive DirectorMaharaja Heritage Resorts Limited Non-Executive DirectorMimec (India) Limited Non-Executive DirectorLandbase India Limited Additional Non-Executive DirectorLogix Developers Private Limited Non-Executive Director
Committee Membership of other companiesName of the Committee Positioncompany
International Travel House Limited Stakeholders Relationship MemberCommitteeAudit Committee MemberNominations amp Remuneration MemberCommittee
Fortune Park Hotels Limited Corporate Social MemberResponsibility Committee
Srinivasa Resorts Limited Audit Committee ChairmanCorporate Social MemberResponsibility Committee
D R Choudhury
Devkanya Roy Choudhury (41) DIN 07066556 wasappointed as a Non-Executive Director of the Company on19th January 2015 A Graduate from the National LawSchool of India University Bengaluru she joined ITC Limitedin 2001 As part of Corporate Legal of ITC she has rich andvaried experience in handling legal matters pertaining tovarious divisions including Tobacco Hotels Personal CareLifestyle Retailing Education amp Stationery Paperboards ampSpecialty Papers ITC Infotech as also dealing with mergersamp acquisitions and key litigation across ITC CurrentlyMs Choudhury is the Senior Associate General Counsel ofITC Limited
Other Directorships
Name of the Company Position
WelcomHotels Lanka (Private) Limited Non-Executive Director
YOUR DIRECTORS
Denotes foreign company Denotes listed Indian company whose equity shares or preference shares or debt securities are listed on a recognised
stock exchangeNotes1 Other Directorships and Committee Memberships of Directors are as on 15th April 20192 Committee Memberships cover Committees under the Companies Act 2013 viz Audit Committee Stakeholders
Relationship Committee Nomination and Remuneration Committee and CSR Committee of Indian Companies
11
REPORT ON CORPORATE GOVERNANCE
The Directors present the Companyrsquos Report on CorporateGovernance pursuant to the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements)Regulations 2015 (lsquoListing Regulations 2015rsquo)
THE COMPANYrsquoS GOVERNANCE PHILOSOPHY
The Company firmly believes in good CorporateGovernance and has made it a practice and a continuousprocess of development right across the Company TheCompanyrsquos philosophy on Corporate Governanceenvisages attainment of high level of transparency andaccountability in the functioning of the Company andconduct of business and places due emphasis onregulatory compliance It has empowered the ExecutiveManagement to take decisions with regard to day-to-dayoperations and has also created checks and balances thatsuch decisions are taken with care and responsibility tomeet stakeholdersrsquo aspirations and societal expectations
The Companyrsquos corporate philosophy is focused on itspeople who are its most important asset and it values itsemployeesrsquo integrity creativity ability judgement andopinions who in turn demonstrate the highest ethicalstandards and responsibility towards the shareholdersThis has helped the Company take rapid strides in itspursuit of excellence
The Company is committed to enhance shareholder valuein a fair and transparent manner and has been in theforefront for benchmarking itself with the best businesspractices globally
BOARD OF DIRECTORS
All statutory and other significant and material informationare placed before the Board of Directors (the Board) toenable it to discharge its responsibility of strategicsupervision of the Company as trustees of theshareholders
Composition
The Board comprises entirely of Non-Executive Directorsincluding one Woman Director and two IndependentDirectors The strength of the Board as on 15th April 2019is five
The Board Diversity Policy of the Company requires theBoard to have balance of skills experience and diversity ofperspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the Annexure forming part ofthis Report These skills expertise and competencies areavailable in the present mix of the Directors of the Company
Composition of the Board as on 31st March 2019
Category No of PercentageDirectors to total no
of Directors
Non-Executive Independent Directors 3 50Other Non-Executive Directors 3 50Total 6 100
During the year there was no change in the directorshipMr R C Mehta resigned as Non-Executive IndependentDirector of the Company with close of work on 31st March2019 keeping in view the Regulation 17(1A) of ListingRegulations 2015
Mr Mehta has confirmed that there are no other reasons forhis resignation other than stated above
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Board were held The intervening periodbetween two Board meetings was well within the maximumgap of 120 days prescribed under the Listing Regulations2015
Board Agenda
Meetings are governed by a structured agenda The Boardmembers in consultation with the Chairman may bring upany matter for the consideration of the Board All majoragenda items are backed by comprehensive backgroundinformation to enable the Board to take informed decisionsAgenda papers are generally circulated seven days prior tothe Board meeting
Information placed before the Board
The following matters are tabled for the Boardrsquos periodicreview information
bull Annual operating plans amp budgets and periodic reviewof the Companyrsquos businesses
bull Quarterly performance
bull External Audit Management Reports (through the AuditCommittee)
bull Status of legal compliance
bull Status and effectiveness of risk management plans
bull Succession to senior management (through theNominations and Remuneration Committee)
bull Statutory compliance reports
bull Show cause demand prosecution adjudicationnotices if any from revenue authorities which areconsidered materially important including anyexposure that exceeds 1 of the Companyrsquos net worthand their outcome
12
bull W rite-offs disposals (fixed assets receivablesadvances etc) on a half-yearly basis
bull Significant development in Human Resources Industrial Relations
bull Material non-compliance of any regulatory or listingrequirements and in relation to shareholdersrsquoservices
bull All other matters required to be placed before theBoard for its review information under the ListingRegulations 2015 and other statutes
Post-meeting follow-up systemThe Governance processes in the Company include aneffective post-meeting follow-up review and reportingprocess for action taken pending on decisions of the Boardand the Board Committees
Details of Board Meeting during the financial year
During the financial year ended 31st March 2019 fourmeetings of the Board were held as follows
SI Date Board No ofNo Strength Directors
present
1 17th April 2018 6 6
2 7th August 2018 6 6
3 1st November 2018 6 5
4 30th January 2019 6 5
COMMITTEES OF THE BOARD
Currently there are three Committees of the Board ndash theAudit Committee the Stakeholders RelationshipCommittee and the Nominations and RemunerationCommittee The terms of reference of the BoardCommittees are determined by the Board from time to timeMeetings of Board Committees are convened by therespective Committee Chairman All the recommendationsmade by Board Committees during the year were acceptedby the Board Minutes of Board Committee meetings areplaced before the Board for its information The role andcomposition of these Committees including the numberof meetings held during the financial year and the relatedattendance are provided below
A AUDIT COMMITTEEThe Audit Committee of the Board provides reassurance tothe Board on the existence of an effective internal controlenvironment that ensuresbull efficiency and effectiveness of operations
bull safeguarding of assets and adequacy of provisionsfor all liabilities
bull reliability of financial and other managementinformation and adequacy of disclosures
bull compliance with all relevant statutesThe role of the Committee includes the followingbull To oversee the Companyrsquos financial reporting process
and the disclosure of its financial information to
REPORT ON CORPORATE GOVERNANCE
Directorsrsquo attendance at the Board Meetings during the financial year and at the last Annual General Meeting (AGM) as alsotheir other Directorships and Committee Memberships are given below
SI Director Category No of Attendance No of No of Membership(s) No Board at last other Chairmanship(s) of Audit
Meetings AGM Directorship(s) Committee Stakeholdersattended Relationship Committee of
other Indian public limitedcompanies
1 N Anand Chairman amp 4 Yes 8 1Non-Executive Director
2 C K Koshy Non-Executive 4 Yes Nil NilIndependent Director
3 R C Mehta1 Non-Executive 2 Yes 4 NilIndependent Director
4 M Narayanan Non-Executive 4 Yes 4 4 (all as Chairman)Independent Director
5 D R Choudhary Non-Executive Director 4 Yes 1 Nil6 J Singh Non-Executive Director 4 Yes 8 3 (including 1 as Chairman)
1 Resigned as Non-Executive Independent Director wef 1st April 2019 Details with respect to other Directorships of the Directors are provided under the section lsquoYour Directorsrsquo in the Report and Accounts
13
ensure that the financial statements are correctsufficient and credible
bull To recommend the appointment remuneration termsof appointment and removal of Statutory Auditors
bull To approve transactions of the Company with relatedparties
bull To evaluate the Companyrsquos internal financial controlsand risk management systems
bull To review with the management the following
- Annual financial statements and Auditorrsquos Reportthereon before submission to the Board forapproval
- Quarterly financial statements before submissionto the Board for approval
bull To review the following
- Management discussion and analysis of financialcondition amp results of operations and mattersrequired to be included in the DirectorsrsquoResponsibility Statement
- Adequacy of internal control systems and theCompanyrsquos statement on the same prior toendorsement by the Board such review to bedone in consultation with the managementStatutory and Internal Auditors
- Adequacy of internal control systems forcompliance with the provisions of the Securitiesand Exchange Board of India (Prohibition ofInsider Trading) Regulations 2015
- Reports of Internal Audit and discussion withInternal Auditors on any significant findings andfollow-up thereon
- Statutory Auditorsrsquo independence andperformance and effectiveness of the auditprocess
- System for storage retrieval security etc of booksof account maintained in the electronic form
- Functioning of Whistleblower mechanism in theCompany
Composition
The Audit Committee as on 15th April 2019 comprisesthree Non-Executive Directors two of whom are IndependentDirectors The Chairman of the Committee is anIndependent Director The Chief Executive Officer the ChiefFinancial Officer and the representative of Statutory Auditorsare Invitees to meetings of the Audit Committee and theCompany Secretary is the Secretary to the Committee Allmembers of the Committee are financially literate twomembers including the Chairman of the Committee haveaccounting and financial management expertise
The names of the members of the Audit Committeeincluding its Chairman are provided under the sectionlsquoBoard of Directors amp Committeesrsquo in the Report andAccounts
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Audit Committee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 4 4
2 7th August 2018 4 4
3 1st November 2018 4 3
4 30th January 2019 4 3
Attendance at Audit Committee Meetings during thefinancial year
Member No of meetingsattended
M Narayanan1 4
C K Koshy 4
R C Mehta2 2
J Singh 41 Appointed Chairman wef 15th April 20192 Ceased to be Member and Chairman wef 1st April 2019
B STAKEHOLDERS RELATIONSHIP COMMITTEE
The Stakeholders Relationship Committee of the Boardoversees redressal of shareholder and investor grievancesand inter alia approves transmission of sharessub-division consolidation renewal of share certificatesissue of duplicate share certificates etc
Composition
The Stakeholders Relationship Committee presentlycomprises three Non-Executive Directors including oneIndependent Director The Chairman of the Committee is aNon-Executive Director The Company Secretary is theSecretary to the Committee
The names of the members of the StakeholdersRelationship Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 sevenmeetings of the Stakeholders Relationship Committeewere held as follows
REPORT ON CORPORATE GOVERNANCE
14
SI Date Committee No ofNo Strength Members
present1 17th April 2018 2 2
2 29th June 2018 2 2
3 7th August 2018 2 2
4 27th September 2018 2 2
5 1st November 2018 2 2
6 4th January 2019 2 2
7 30th January 2019 2 2
Attendance at Stakeholders Relationship CommitteeMeetings during the financial year
Member No of meetingsattended
J Singh 7
D R Choudhury 7
C K Koshy 0
Appointed Member wef 31st March 2019
C NOMINATIONS AND REMUNERATION COMMITTEEThe Nominations and Remuneration Committee of theBoard inter alia identifies persons qualified to becomeDirectors and formulates criteria for evaluation ofperformance of the Directors and the Board as a wholeThe Committeersquos role includes recommending to theBoard the appointment remuneration and removal ofDirectors and Key Managerial Personnel
Composition
The Nominations and Remuneration Committee as on15th April 2019 comprises four Non-Executive Directorstwo of whom are Independent Directors The Chairman ofthe Committee is an Independent Director The CompanySecretary is the Secretary to the Committee
The names of the members of the Nominations andRemuneration Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 twomeetings of the Nominations and RemunerationCommittee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 5 5
2 30th January 2019 5 4
Attendance at Nominations and Remuneration CommitteeMeetings during the financial year
Member No of meetingsattended
C K Koshy 2
N Anand 2
R C Mehta1 1
M Narayanan 2
J Singh 21 Ceased to be Member wef 1st April 2019
Remuneration Policy
The Companyrsquos Remuneration Policy aims at attractingand retaining high calibre talent The Remuneration Policytherefore is market-led and takes into account thecompetitive circumstance of each business so as to attractand retain quality talent and leverage performancesignificantly
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpwwwgujarathotels ltd in polic ies Remuneration-Policy_GHLpdf There has been no change in the Policyduring the year
Remuneration of Directors
Non-Executive Directors are entitled to sitting fees forattending the meetings of the Board and its Committeesthe quantum of which is determined by the Board Thesitting fees to Non-Executive Directors as determined bythe Board are ` 20000- and ` 10000- for each meeting ofthe Board and its Committees respectively
Details of sitting fees paid to the Directors during thefinancial year ended 31st March 2019
Director Sitting Fees (`)
C K Koshy 150000-
R C Mehta1 70000-
M Narayanan 150000-1 Resigned as Non-Executive Independent Director wef1st April 2019
Note Disclosure with respect to Non-Executive Directors ndashPecuniary relationship or transaction None
Performance Evaluation
Performance evaluation of the Board the BoardCommittees and the individual Directors was carried outby the Board in accordance with the Policy approved by theNominations and Remuneration Committee in this regardbrief details of the same are provided in the lsquoReport of theBoard of Directors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
REPORT ON CORPORATE GOVERNANCE
15
Directorsrsquo Shareholding
Details of Shareholding of the Directors in the Company ason 31st March 2019 are given below
Director No of Equity Shares of ` 10-each held singly jointly
N Anand 200
D R Choudhury Nil
C K Koshy Nil
R C Mehta Nil
M Narayanan Nil
J Singh Nil
OTHER DISCLOSURESbull Details of non-compliances penalties and strictures
by Stock Exchanges SEBI Statutory Authorities onany matter related to capital markets during the lastthree years
Nonebull Inter-se relationships between Directors and Key
Managerial Personnel of the Company
Nonebull Materially significant related party transactions which
may have potential conflict with the interests of theCompany at large
Nonebull Material financial and commercial transactions of
senior management where they may have hadpersonal interest and which had potential conflict withthe interests of the Company at large
Nonebull Details of utilisation of funds raised through
preferential allotment or qualified institutionsplacement
Not Applicablebull Credit rating(s) obtained by the Company for any debt
instrument fixed deposit programme or any otherscheme involving mobilisation of funds
Nonebull None of the Directors of the Company has been
debarred or disqualified from being appointed orcontinuing as a Director by SEBI Ministry of CorporateAffairs Statutory Authorities which has also beenconfirmed by Messrs PB amp Associates PractisingCompany Secretaries
bull Confirmation by the Board with respect to theIndependent Directors is provided in the lsquoReport ofthe Board of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Disclosures in relation to the Sexual Harassment ofWomen at Workplace (Prevention Prohibition andRedressal) Act 2013 are provided in the lsquoReport of theBoard of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Information with respect to lsquoCommodity Price Risk orForeign Exchange Risk and Hedging Activitiesrsquo
Nonebull The total fees paid by the Company to Messrs K C
Mehta amp Co Statutory Auditors and all other entitiesforming part of the same network aggregate` 100000-
bull Compliance Officer under the Listing Regulations2015
Deepak Kumar Gulati Company Secretary
MEANS OF COMMUNICATION
Timely disclosure of consistent comparable relevant andreliable information on corporate financial performance isat the core of good governance Towards this end thequarterly results of the Company were announced withinforty five days from the end of the quarter Audited annualresults along with the results for the fourth quarter wereannounced within sixty days from the end of the financialyear Extract of these results were published in lsquoTheFinancial Expressrsquo (all editions) and in its Gujarati editionas vernacular newspaper Further quarterly resultsshareholding pattern and other material events amp importantinformation relating to the Company were submitted to BSELimited through BSE Listing Centre for dissemination onits website The Company publishes its quarterlyhalf-yearly and annual financial results and also posts suchresults on its website wwwgujarathotelsltdin
The Report of the Board of Directors forming part of theReport and Accounts includes all aspects of lsquoManagementDiscussion and Analysisrsquo as required under the ListingRegulations 2015
GHL CODE OF CONDUCT FOR PREVENTION OF INSIDERTRADING ndash 2019
The GHL Code of Conduct for Prevention of Insider Tradingapproved by the Board inter alia prohibits trading insecurities of the Company by Directors and employeeswhile in possession of unpublished price sensitiveinformation in relation to the Company
GHL CODE OF CONDUCT
The GHL Code of Conduct is applicable to Directors seniormanagement and employees of the Company The Codeis derived from three interlinked fundamental principlesviz good corporate governance good corporate citizenshipand exemplary personal conduct in relation to theCompanyrsquos business and reputation The Code coversGHLrsquos commitment to sustainable development concern
REPORT ON CORPORATE GOVERNANCE
16
for occupational health safety and environment a genderfriendly workplace transparency and auditability legalcompliance and the philosophy of leading by personalexample The Code is available on the Companyrsquos website
Declaration as required under the Listing Regulations 2015All Directors and senior management of the Companyhave affirmed compliance with the GHL Code of Conductfor the financial year ended 31st March 2019New Delhi K Pahwa15th April 2019 CEO
WHISTLEBLOWER POLICYSynopsis of the Whistleblower Policy of the Company isprovided in the lsquoReport of the Board of Directors ampManagement Discussion and Analysisrsquo forming part of theReport and Accounts The Whistleblower Policy is alsoavailable on the Companyrsquos websiteFAMILIARISATION PROGRAMME FOR DIRECTORSGHL believes that a Board which is well informed familiarised with the Company and its affairs can contributesignificantly to effectively discharge its role of trusteeshipin a manner that fulfils stakeholdersrsquo aspirations andsocietal expectations In pursuit of this the Directors of theCompany are updated on changes developments in thedomestic global corporate and industry scenario includingthose pertaining to statutes legislations and economicenvironment and on matters affecting the Company toenable them to take well informed and timely decisionsFurther details may be accessed on the Companyrsquos websiteat httpwwwgujarathotelsltdinpoliciesDirectorrsquos-Familiarisation-programmespdfPOLICY ON RELATED PARTY TRANSACTIONSThe Policy as approved by the Board may be accessed onthe Companyrsquos website at
h t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_TranscationspdfDISCRETIONARY REQUIREMENTS UNDER THE LISTINGREGULATIONS 2015The status of compliance with the discretionaryrequirements under the Listing Regulations 2015 isprovided below1 Chairmanrsquos Office The Company has a Non-Executive
Chairman but he does not maintain any separate officeand hence no expense in this regard is being incurredby the Company
2 Shareholder Rights The quarterly half-yearly andannual financial results of the Company are postedon the Companyrsquos website and extract of these resultsare published in newspapers on an all India basisThe complete Report and Accounts is sent to everyShareholder of the Company
3 Audit Opinion It has always been the Companyrsquosendevour to present financial statements with
unmodified audit opinion The Statutory Auditors haveissued an unmodified audit opinion on the Companyrsquosfinancial statements for the year ended 31st March2019
4 Separate posts of Chairman and Chief ExecutiveOfficer The Company has a Non-Executive Chairmanand a Chief Executive Officer
5 Internal Audit The Internal Auditor of the CompanyMessrs Shah amp Talati Chartered Accountants reportsto the Audit Committee of the Board
GENERAL SHAREHOLDER INFORMATIONProvided in the lsquoShareholder Informationrsquo section of theReport and Accounts
CONFIRMATION OF COMPLIANCEbull It is confirmed that the Company has complied with
the requirements prescribed under Regulations 17 to27 and clauses (b) to (i) of sub - regulation (2) ofRegulation 46 of the Listing Regulations 2015
bull The Statutory Auditorsrsquo Certificate that the Companyhas complied with the conditions of CorporateGovernance is annexed to the lsquoReport of the Board ofDirectors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
ANNEXURE TO THE REPORT ON CORPORATEGOVERNANCESKILLS EXPERTISE AND COMPETENCIES OF DIRECTORSThe Company believes that Board members should havea balance of skills experience and diversity of perspectivesappropriate to the Company Accordingly the Directorsshould possess one or more of the following skillsexpertise and competencies
1 Leadership
Leadership experience in a commensurate-sizedorganisation with understanding of organisationalsystems and processes strategic areas andemerging business trends
2 Industry Knowledge and Experience
Domain knowledge of Hotel business and itsdynamics long-term strategies and regulatory ampcompetitive environment
3 Finance and Accounting
Ability to understand financial policies accountingstatements and disclosure practices to contribute tothe financial risk management policies and practicesof the Company
4 Governance
Commitment belief and experience in settinggovernance practices to support the Companys legalcompliance systems and governance polic ies practices
REPORT ON CORPORATE GOVERNANCE
17
SHAREHOLDER INFORMATION
AGM Details
Date Saturday 7th September 2019Venue WelcomHotel Vadodara R C Dutt Road
Alkapuri Vadodara 390 007Time 1100 amBook Friday 30th August 2019 toClosure Saturday 7th September 2019Dates (both days inclusive)Dividend Friday 13th September 2019PaymentDate
Registrar and Share Transfer Agents
Messrs MCS Share Transfer Agent Limited are the Registrarand Share Transfer Agents (RTA) of the Company forcarrying out share registration and other related activitiesof the Company
Address for Correspondence
MCS Share Transfer Agent LimitedF-65 1st Floor Okhla Industrial AreaPhase ndash I New Delhi - 110 020Telephone Nos 011 4140 6149-52 4160 9386Facsimile No 011 4170 9881E-mail helpdeskdelhimcsregistrarscom
Shareholders holding shares in the dematerialised formshould address their correspondence except those relatedto dividend to their respective Depository Participants
Share Transfer Committee
The Share Transfer Committee of the Company generallymeets once in ten days for approving share transfers Theprocessing activities with respect to requests received forshare transfers are completed within fifteen days from thedate of receipt of request The Committee met 11 timesduring the financial year ended 31st March 2019 to approveshare transfers There were no share transfers pendingas on 31st March 2019
The Share Transfer Committee presently comprises thefollowing
D R Choudhury - Director MemberJ Singh - Director MemberM Agarwal - Compliance Officer Member
Dematerialisation of Shares and Liquidity
The shares of the Company are available for trading in thedematerialised form under both the Depository Systems inIndia - NSDL and CDSL The International SecuritiesIdentification Number (lSIN) allotted to the Companysshares under the Depository System is INE621C01011
As on 31st March 2019 a total of 3525013 Equity Sharesof the Company which translates to 9307 of the ShareCapital stood dematerialised The processing activitieswith respect to requests received for dematerialisation arecompleted between fifteen to thirty daysShareholder Investor ComplaintsThe Company attends to Shareholder Investor complaintsqueries and other correspondence generally within fifteendays except where constrained by disputes or legalimpedimentsThe Company did not receive any complaint during thefinancial year ended 31st March 2019The e-mail ID earmarked by the Company for this purposeghlinvestorsyahoocoinDistribution of Shareholding as on 31st March 2019
No of No of EquityNo of Shareholders Shares
SharesSlab Total to Total to
Share Shareholders Capital
1 - 500 5152 9455 587438 1551501 - 1000 138 253 112061 296
1001 - 2000 68 125 100167 2652001 - 3000 26 048 62030 1643001 - 4000 16 029 58804 1554001 - 5000 11 020 50785 1345001 - 10000 23 042 163405 431
10001 - 50000 8 015 147787 39050001 - 100000 3 006 226954 599
100001 amp Above 4 007 2278084 6015Total 5449 10000 3787515 10000
Categories of Shareholders as on 31st March 2019Sl Category No of toNo Shares Share
held hold ingA Promoter Holding1 Promoter and Promoter Group
ITC Limited 1733907 4578Russell Investments Limited 300056 792Sub-Total 2033963 5370
B Non Promoter Holding2 Institutional Investorsa Mutual Funds NIL NILb Banks 100 000c Foreign Institutional Investors and NIL NIL
Foreign Portfolio InvestorsSub-Total 100 000
3 Othersa Private Corporate Bodies 193726 511b Indian Public 1335461 3527c NRIs 102362 270d Others 121903 322
Sub Total 1753452 4630Grand Total 3787515 10000
18
Monthly High and Low Quotes and Volume of Sharestraded on BSE Limited
Year Month High L o w Volume(` ) (` ) (Nos)
2018 April 13800 12000 93584May 13100 11710 26778June 12735 11500 18090July 12195 11400 27113August 12295 11450 14900September 12000 10900 23492October 11400 10505 18787November 12975 10700 15386December 11490 10700 40291
2019 January 11320 10700 22160February 11185 10005 12395March 11295 10400 21625
Performance in comparison to broad based indices suchas SampP BSE Sensex
Note - Indicates monthly closing positions
Listing of Shares on Stock Exchange (with Stock Code)BSE Limited (507960)Phiroze Jeejeebhoy Towers Dalal Street Mumbai 400 001Telephone Nos 022-2272 1233 34Facsimile No 022-2272 1919E-mail isbseindiacomWebsite wwwbseindiacom
The Listing Fee for the financial year 2019-20 has beenpaid to BSE Limited
Financial CalendarFinancial Year 2019-20(1st April - 31st March)
1 First Quarter Results July 20192 Second Quarter and October November 2019
Half-Year Results3 Third Quarter Results January February 20204 Fourth Quarter and May 2020
Annual Results
Particulars of past three AGMsAGM Financial Venue Date Time Special
Year ResolutionPassed
36th 2017-18 WelcomHotel 07-08-2018 NoneVadodara
35th 2016-17 R C Dutt Road 08-08-2017 1100 NoneAlkapuri am
34th 2015-16 Vadodara 20-09-2016 None390 007
Postal Ballot
No special resolution requiring postal ballot was eitherproposed last year or is being proposed for the ensuing AGM
SHAREHOLDER REFERENCER
Transfer of Shares in certificate form
Effective 1st April 2019 transfer of shares of a listedcompany can only be effected in dematerialised form interms of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 Shareholders holdingshares in the certificate form are therefore requested todematerialise their shares in their own interestCommunication in this respect has been sent by theCompany during the year to the concerned ShareholdersHowever transfer deeds which were lodged with theCompany on or before 31st March 2019 but were returneddue to any deficiency will be processed upon re-lodgement
Transfer of Dividend and corresponding Equity Shares tothe Investor Education and Protection Fund (IEPF)
During the financial year 2018-19 unclaimed dividend forthe financial year 2010-11 aggregating ` 636444- andthe corresponding 13150 Equity Shares in respect of whichdividend entitlements remained unclaimed for sevenconsecutive years or more have been transferred by theCompany to the IEPF established by the CentralGovernment pursuant to the provisions of Section 124 ofthe Companies Act 2013 read with the Investor Educationand Protection Fund Authority (Accounting Audit Transferand Refund) Rules 2016
Shareholders may claim their unclaimed dividend for theyears prior to and including the financial year 2010-11 andthe corresponding shares from the IEPF Authority byapplying in the prescribed Form No IEPF-5 This Form canbe downloaded from the website of the IEPF Authoritywwwiepfgovin the access link of which is also availableon the Companys website wwwgujarathotelsltdin underthe section General Information under Shareholder Value
The unclaimed dividend for the undernoted years and thecorresponding shares will be transferred by the Companyto the IEPF in accordance with the schedule given belowAttention in particular is drawn that the unclaimed dividendfor the financial year 2011-12 and the corresponding shareswill be due for transfer to the IEPF on 14th September
SHAREHOLDER INFORMATION
19
Central Depository Services (India) LimitedMarathon Futurex A Wing 25th FloorMafatlal Mill Compound N M Joshi MargLower Parel Mumbai 400 013Telephone No 022-2302 3333Facsimile No 022-2300 2035E-mail helpdeskcdslindiacomWebsite wwwcdslindiacomRemittance of Dividend through Electronic ModeThe Company provides the facility for remittance of dividendto Shareholders through RTGS (Real Time GrossSettlement) NACH (National Automated Clearing House) NEFT (National Electronic Funds Transfer)
Shareholders who have not opted for remittance of dividendthrough electronic mode and wish to avail the same arerequired to provide their bank details including IFSC (IndianFinancial System Code) and MICR (Magnetic Ink CharacterRecognition) to their respective Depository Participants(DPs) or to the RTA where shares are held in thedematerialised form and in the certificate form respectively
Shareholders holding shares in the certificate form mayuse the Mandate Form for this purpose which can bedownloaded from the Companys websitewwwgujarathotelsltdin under the section GeneralInformation under Shareholder Value
Address and Bank DetailsShareholders holding shares in the certificate form arerequested to advise the RTA of any change in their address mandate bank details to facilitate better servicingShareholders are advised that as a measure of protectionagainst fraudulent encashment their bank details oraddress as available with the RTA will be printed on thedividend warrants or demand drafts where dividend cannotbe remitted through electronic mode
Permanent Account Number (PAN)Shareholders holding shares in the certificate form arerequested to send copies of their PAN Cards to the RTA tofacilitate better servicing
Furnishing of PAN Card however is mandatory as followsi) Transferees and Transferors PAN Cards for transfer
of sharesii) Legal heirs Nominees PAN Cards for transmission
of sharesiii) Surviving joint holders PAN Cards for deletion of name
of deceased Shareholders andiv) Joint holders PAN Cards for transposition of shares
Nomination Facility
Shareholders who hold shares in the certificate form andwish to make any nomination change nomination madeearlier in respect of their shareholding in the Companyshould submit to the RTA the prescribed Form such Formcan be downloaded from the Companys website underthe section Investor Relations under Shareholder Value
SHAREHOLDER INFORMATION
2019 for which purpose communication has been sent tothe concerned Shareholders advising them to write to theCompany to claim their dividend Notices in this regardhave also been published in newspapers Details of suchunclaimed dividend and corresponding shares areavailable on the Companys website under the sectionGeneral Information under Shareholder Value
Financial Date of declaration Due date for transferYear of Dividend to IEPF2011-12 8th August 2012 14th September 2019
2012-13 13th August 2013 19th September 2020
2013-14 29th September 2014 5th November 2021
2014-15 29th September2015 5th November 2022
2015-16 20th September 2016 26th October 2023
2016-17 8th August 2017 14th September 2024
2017-18 7th August 2018 12th September 2025
The Company will not be able to entertain any claim receivedafter 12th September 2019
Shareholders who have not so far encashed their dividendwarrant(s) or have not received the same are requested toapply for duplicate warrant(s) by writing to the Companyand confirming non-encashment non-receipt of dividendwarrant(s)
Service of Documents
The Company sends Notices Report and Accounts andother communications in electronic mode to thoseShareholders who have registered their e-mail addresseswith the Company or with the Depositories and in physicalmode to the other Shareholders
Shareholders who wish to register or update their e-mailaddresses with the Company may use the Form forregistration updation which can be downloaded from theCompanys website under the section Investor Relationsunder Shareholder Value
Depository Services
Shareholders may write to the respective Depository or tothe RTA for guidance on depository services
The contact details of the Depositories are given below
National Securities Depository LimitedTrade World A Wing 4th FloorKamala Mills CompoundSenapati Bapat Marg Lower ParelMumbai 400 013Telephone No 022-2499 4200Facsimile No 022-2497 6351E-mail infonsdlcoinWebsite wwwnsdlcoin
20
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
FOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019Your Directors submit their Report for the financial yearended 31st March 2019
BUSINESS ENVIRONMENT
The global economic growth softened to 36 in 2018representing a marked slowdown compared to the 39growth anticipated at the beginning of the year buoyed bya strong fiscal expansion in the USA which was offset largelyby slower growth in some other large economies ieEurope Japan etc Going forward global growth in 2019 isprojected to decline further to 33 in the base case withrisks to the downside emanating from politicaluncertainties rising trade tensions escalatingprotectionism and tighter financial conditions
As per Ministry of Statistics amp Programme Implementation(MSPI) Indian economy registered the GDP growth of 7in 2018-19 as compared to 72 in 2017-18 The economyis expected to grow and maintain a level of 75 in 2019and 2020 as per the World Bank estimates
India is the most digitally-advanced traveller nation in termsof digital tools being used for planning booking andexperiencing a journey During 2018 foreign tourist arrivals(FTAs) in India stood at 1056 million achieving a growthrate of 52 year-on-year The Government of India is alsoworking to achieve 1 share in worldrsquos international touristarrivals by 2020 and 2 share by 2025
The operating environment in the hospitality sector showedimprovement with foreign tourist arrivals Indiarsquos risingmiddle class and increasing disposable incomes havecontinued to support the growth of domestic tourism
With the inauguration of Statue of Sardar Vallabhbhai Patelalso known as lsquoStatute of Unityrsquo which is the higheststanding statue in the world at a height of 182 meters thetourism in the city of Vadodara is expected to grow
FINANCIAL PERFORMANCE
During the year under review your Company earned licensefees of ` 36987 lakhs (previous year ` 33098 lakhs)Theother income at ` 19626 lakhs showed an increase mainlydue to improvement in return on current investment Preand post-tax profits increased to ` 51822 lakhs (previousyear ` 45313 lakhs) and ` 40788 lakhs (previous year` 33690 lakhs) respectively
Your Directors are pleased to recommend a dividend of` 350 per Equity Share of ` 10- each for the year ended31st March 2019 thereby maintaining last yearrsquos dividendand involving a cash outflow of ` 160 lakhs includingDividend Distribution Tax of ` 27 Lakhs
PROFITS DIVIDEND AND RETAINED EARNINGS
The financial results of your Company summarised areas under
For the year ended For the year ended31st March 2019 31st March 2018
Profits (` ) (` )
a Profit Before Tax 51822363 45312928
b Tax Expense
Current Tax 11653499 9272310Deferred Tax (618755) 2350502
c Profit for the year 40787619 33690116
d Other Comprehensive Income - -
e Total Comprehensive Income 40787619 33690116
Statement of Retained Earningsa At the beginning of the year 213211090 195873461
b Add Total Comprehensive Income 40787619 33690116
c Less Dividend paid including IncomeTax on Dividend paid 15981176 15954974
d Less Income Tax on Dividend paid forearlier year - 397513
e At the end of the year 238017533 213211090
Your Directors are pleased to recommend a dividend of` 350 per Equity Share (Previous Year ` 350) of ` 10-each for the year ended 31st March 2019
Details of changes in Key Financial Ratio amp Return onNet Worth
The key financial ratio of the Company where there hasbeen significant change (25 or more) and change inReturn on Net Worth are summarized below pursuant toSchedule V (B) to the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements)Regulations 2015 (Listing Regulations 2015)
HOTEL OPERATIONS
Your Hotel WelcomHotel Vadodara licensed to ITC Limitedrecorded an income of ` 249443 lakhs during the year ascompared to ` 221856 lakhs in the previous year Therewas an improvement in both occupancy and average roomrates leading to an overall improvement in HotelPerformance
Financial Ratio
2018-19 2017-18 Change
Reason for change
Current Ratio
278 223 25 Increase in value of current investment based on accumulation of market return and fresh investment done during the year out of surplus funds
Return on Net Worth
133 120 11 Due to higher rate of growth in profit after tax
21
The Food amp Beverage segment of your Companyrsquos Hotelcontinues to be a major strength The Peshawri Restaurantand the Welcom Cafeacute Cambay both retained their premiumleadership positions
Your Company has filed a writ petition in the Gujarat HighCourt seeking that the Gujarat State Government be directedto take action on your Companyrsquos application to have theleasehold land of the Hotel converted to freehold andtransferred to your Company as per the existing governmentpolicy in this regard The Honourable High Court passedan Order on 24th December 2014 restraining the StateGovernment from disturbing the peaceful and actualpossession of the Company over the hotel property in anymanner including construction thereon The writ petition ispending
Your Company is also making all efforts for expeditiousconversion of land from leasehold to freehold or in thealternative extension of Lease For further details pleaserefer to Note no 20A of the Accounts
SUBSIDIARIES ASSOCIATES AND JOINT VENTURES
The Company does not have any subsidiary associate orjoint venture
INTERNAL FINANCIAL CONTROLS
Your Company is managed by the Board of Directors andthe Executive Management with clearly defined rolesresponsibilities and authorities The Executive Managementis responsible for the day-to-day conduct of the affairs ofthe Company within the overall framework approved by theBoard Your Company also has a Code of Conduct whichrequires management to conform to the required financialand accounting policies systems and processes conductbusiness ethically and ensure strict compliance with allapplicable laws and regulations Ongoing ReviewProcesses and the Risk Management Framework create acontrol environment in the Company and provide thecornerstones for Internal Financial Controls with referenceto your Companyrsquos Financial Statements
Your Companyrsquos Financial Statements are prepared on thebasis of the Significant Accounting Policies that are carefullyselected by the management and approved by the AuditCommittee and the Board These Policies are reviewedand updated from time to time and audited by the InternalAuditor whose findings and recommendations are reviewedby the Audit Committee and tracked through toimplementation
Your Company maintains its Books of Account in electronicform Your Company has in place adequate internalfinancial controls with reference to the FinancialStatements
The Internal Auditors of the Company evaluates theadequacy and efficacy of such internal financial controlsSuch controls have been assessed during the year by the
management Based on the results of this assessmentno reportable material weakness or significant deficienciesin the design or operation of internal financial controls wereobserved Nonetheless your Company recognises that anyinternal financial control framework no matter how welldesigned has inherent limitations and accordingly regularaudit and review processes ensure that such systems arereinforced on an ongoing basis
RISK MANAGEMENT
Your Company continues its emphasis on a systems-basedapproach to business risk managementBacked by stronginternal control systems the current Risk Managementframework consists of the following key elements
- The Board of Directors (lsquoThe Boardrsquo) has clearly laiddown the roles and responsibilities of the Company inrelation to risk management covering a range ofresponsibilities from strategic to operational Theserole definitions provide the foundation for yourCompanyrsquos Risk Management Policy that is endorsedby the Board and is aimed at ensuring formulation ofappropriate risk management procedures theireffective implementation and independent monitoringand reporting by Internal Audit
- Management of risks vest with the ExecutiveManagement which is responsible for the day-to-dayconduct of the affairs of the Company within the overallframework approved by the Board
- A combination of policies and procedures which areregularly reviewed and updated in the light of changingbusiness and regulatory environment bringsrobustness to the process of ensuring that businessrisks are effectively addressed
- Appropriate structures are in place to proactivelymonitor and manage the inherent risks in businesswith unique relatively high risk profiles
- An Independent Internal Audit Firm carries out riskfocused audits enabling identification of areas whererisk management processes may need to bestrengthened
- The Audit Committee of the Board reviews the InternalAudit findings and provides strategic guidance oninternal controls The Chief Executive Officer closelymonitors the internal control environment within yourCompany including implementation of the action plansemerging out of internal audit findings
The combination of policies and processes as outlinedabove adequately address the various risks associatedwith your Companyrsquos business
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
22
AUDIT AND SYSTEMS
Your Company believes that internal control is a necessaryadjunct to the principle of governance that freedom ofmanagement should be exercised within a framework ofappropriate checks and balances Your Company remainscommitted to ensuring an effective internal controlenvironment that provides assurance and comfort on orderlyand efficient conduct of operations security of assetsprevention and detection of frauds errors accuracy andcompleteness of accounting records and timely preparationof reliable financial information
Your Companyrsquos independent and robust Internal Auditprocesses provide assurance on the adequacy andeffectiveness of internal controls compliance withoperating systems internal policies and regulatoryrequirements
The Internal Audit function consisting of an outsourcedprofessional firm is adequately resourced to deliver highstandards of audit assurances
The Audit Committee of your Board met four times duringthe year The Terms of Reference of the Audit Committeeincluded reviewing the adequacy and effectiveness of theinternal control environment monitoring implementationof the action plans emerging out of Internal Audit findingsincluding those relating to strengthening of your Companyrsquosrisk management systems and discharge of statutorymandate
HUMAN RESOURCE DEVELOPMENT
Your Company firmly believes that employees are the vitaland most valuable assets and hence has created afavourable work environment that encourages innovationand meritocracy Your Company continues to innovate inthe way human resources are managed and developedstriking a balance between business needs and individualaspirations
With an undying commitment to render delightful servicesyour Companyrsquos employees consistently work towardsdelivering flawless performance and are continuing todelight customers
The Company provides a safe secure inclusive and genderfriendly workplace The Company has put in placeGrievance Redressal Procedures and adopted a Policy onSexual Harassment as per the provisions of the SexualHarassment of W omen at W orkplace (PreventionProhibition and Redressal) Act 2013 and the Rules framedthereunder The Company has an Internal ComplaintsCommittee to ensure that grievances in this regard if anyare effectively addressed During the year under review nocomplaint relating to sexual harassment has beenreceived
WHISTLEBLOWER POLICY
The Companyrsquos W histleblower Policy encouragesDirectors and employees to bring to the Companyrsquosattention instances of unethical behavior actual orsuspected incidents of fraud actual or suspectedinstances of leak of unpublished price sensitive informationor violation of the GHL Code of Conduct that could adverselyimpact the Companyrsquos operations business performanceand or reputation The Policy provides that the Companyinvestigates such incidents when reported in an impartialmanner and takes appropriate action to ensure that therequisite standards of professional and ethical conductare always upheld It is the Companyrsquos Policy to ensurethat no employee is victimised or harassed for bringingsuch incidents to the attention of the Company
The practice of the Whistleblower Policy is overseen by theAudit Committee and no employee has been denied accessto the Committee The Whistleblower Policy is available onthe Companyrsquos website at httpwwwgujarathotelsltdinCorporateGovernancehtml
DEPOSITS
Your Company has not accepted any deposits from thepublic members under Section 73 of the Companies Act2013 (lsquothe Actrsquo) read with the Companies (Acceptance ofDeposits) Rules 2014 during the year
DIRECTORS
Changes in Directors
Mr R C Mehta stepped down as Non-Executive IndependentDirector of the Company with effect from close of work on31st March 2019 keeping in view the Regulation 17(1A) ofthe Listing Regulations 2015 Your Directors would like torecord their appreciation for the services rendered byMr Mehta
The Board at the meeting held on 15th April 2019 on therecommendation of the Nominations and RemunerationCommittee recommended for the approval of the Membersthe re-appointment of Mr C K Koshy and Mr M Narayananas independent directors of your Company in terms ofSection 149 of the Act and Regulation 17 of the ListingRegulations 2015 with effect from 29th September 2019
Requisite Notices under Section 160 of the Act have beenreceived in respect of Messrs Koshy and Narayanan whohave filed their consents to act as Directors of the Companyif appointed
Appropriate resolutions seeking your approval to theaforesaid appointment will appear in the Notice conveningthe Thirty Seventh AGM of your Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
23
Retirement by Rotation
In accordance with the provisions of Section 152 of the Actread with Article 147 of the Articles of Association of theCompany Mr Jagdish Singh will retire by rotation at theensuing Annual General Meeting (lsquoAGMrsquo) of your Companyand being eligible offers himself for re-election Your Boardrecommends his re-election
Number of Board Meetings
During the year ended 31st March 2019 four meetings ofthe Board were held
Attributes Qualifications amp Independence of Directorsand their Appointment
As reported last year the Nominations and RemunerationCommittee of the Board had approved the criteria fordetermining qualifications positive attributes andindependence of Directors in terms of the Act and the Rulesthereunder both in respect of Independent Directors andother Directors as applicable The criteria inter aliarequires that NonndashExecutive Directors includingIndependent Directors be drawn from amongst eminentprofessionals with experience in business finance law public administration and enterprises
The Board Diversity Policy of the Company requires theBoard to have a balance of skills experience and diversityof perspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the lsquoReport on CorporateGovernancersquo forming part of the Report and Accounts TheArticles of Association of the Company provide that thestrength of the Board shall not be fewer than three normore than twelve
Directors are appointed re-appointed with the approval ofthe Members All Directors other than IndependentDirectors are liable to retire by rotation unless otherwiseapproved by the Members One-third of the Directors whoare liable to retire by rotation retire every year and areeligible for re-election
The Independent Directors of your Company haveconfirmed that (a) they meet the criteria of independenceas prescribed under Section 149 of the Act and Regulation16 of the Listing Regulations 2015 and (b) they are notaware of any circumstance or situation which could impairor impact their ability to discharge duties with an objectiveindependent judgement and without any external influenceFurther in the opinion of the Board the IndependentDirectors fulfil the conditions prescribed under the ListingRegulations 2015 and are independent of the managementof the Company
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpw w wg u j a ra th o te ls l td in p o l i c ies R em u n era t io n -
Policy_GHLpdf There has been no change in the Policyduring the year
Board Evaluation
The Nominations and Remuneration Committee hasapproved the Policy on Board Evaluation Evaluation ofBoard Committeesrsquo functioning and individual DirectorEvaluation and also specified that such evaluation will bedone by the Board Board performance is assessed againstthe role and responsibilities of the Board as provided inthe Act and the Listing Regulations 2015 The parametersfor Board performance evaluation have been derived fromthe Boardrsquos core role of trusteeship to protect and enhanceshareholder value as well as fulfil expectations of otherstakeholders through strategic supervision of the CompanyEvaluation of functioning of Board Committees is basedon discussions amongst Committee members and sharedby each Committee Chairman with the Board IndividualDirectors are evaluated in the context of the role played byeach Director as a member of the Board at its meetingsand in assisting the Board in realising its role of strategicsupervision of the functioning of the Company in pursuit ofits purpose and goals
While the Board evaluated its performance against theparameters laid down by the Nominations andRemuneration Committee the evaluation of individualDirectors was carried out anonymously in order to ensureobjectivity The Board was briefed on functioning of BoardCommittees by the respective Committee Chairmen
Key Managerial Personnel
Mr Deependra Rana resigned as the Chief Executive Officerof the Company with effect from 17th December 2018
The Board at the meeting held on 30th January 2019 onthe recommendation of the Nominations andRemuneration Committee appointed Mr Kunal Pahwa asthe Chief Executive Officer of the Company with effect from1st February 2019
AUDIT COMMITTEE amp AUDITORS
The composition of the Audit Committee is provided underthe section lsquoBoard of Directors amp Committeesrsquo in the Reportand Accounts
Statutory Auditors
The Statutory Auditors Messrs K C Mehta amp Co CharteredAccountants (KCM) were appointed with your approval atthe Thirty Fifth AGM to hold such office till the conclusion ofthe Fortieth AGM
On the recommendation of the Audit Committee the Boardrecommended for the approval of the Members paymentof remuneration of KCM for the financial year 2019-20Appropriate resolution for this purpose will appear in theNotice convening the Thirty Seventh AGM of the Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
24
Secretarial Auditors
Your Board appointed Messrs PB amp Associates CompanySecretaries to conduct the secretarial audit of the Companyfor the financial year ended 31st March 2019 Their Reportis provided in the Annexure forming part of this Report interms of Section 204 of the Act
RELATED PARTY TRANSACTIONS
All contracts or arrangements entered into by the Companywith its related parties during the financial year were inaccordance with the provisions of the Act and the ListingRegulations 2015 All such contracts or arrangements wereentered in the ordinary course of business and on armrsquoslength basis and have been approved by the AuditCommittee
Further the details of related party transactions of theCompany in prescribed Form No AOC-2 in terms of Section134 of the Act read with Rule 8 of the Companies (Accounts)Rules 2014 is given in the Annexure to this Report YourCompanyrsquos Policy on Related Party Transactions asadopted by your Board can be accessed on the website ath t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_Transactionspdf
DIRECTORSrsquo RESPONSIBILITY STATEMENT
As required under Section 134 of the Act your Directorsconfirm having
a) followed in the preparation of the Annual Accounts theapplicable Accounting Standards with properexplanation relating to material departures if any
b) selected such accounting policies and applied themconsistently and made judgements and estimates thatare reasonable and prudent so as to give a true andfair view of the state of affairs of your Company at theend of the financial year and of the profit of yourCompany for that period
c) taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with theprovisions of the Act for safeguarding the assets ofyour Company and for preventing and detecting fraudand other irregularities
d) prepared the Annual Accounts on a going concernbasis
e) laid down internal financial controls to be followed byyour Company and that such internal financial controlswere adequate and operating effectively and
f) devised proper systems to ensure compliance withthe provisions of all applicable laws and that suchsystems were adequate and operating effectively
OTHER INFORMATION
Compliance with the conditions of Corporate Governance
The certificate of the Statutory Auditors Messrs K C Mehtaamp Co Chartered Accountants confirming compliance withthe conditions of Corporate Governance as stipulated underthe Listing Regulations 2015 is annexed
Compliance with Secretarial Standards
The Company is in compliance with the applicableSecretarial Standards issued by the Institute of CompanySecretaries of India and approved by the CentralGovernment under Section 118 of the Act
Cost Records
The Company is not required to maintain cost records interms of Section 148 of the Act read with the Companies(Cost Records and Audit) Rules 2014
Going Concern Status
There is no significant or material order passed during theyear by any regulator court or tribunal impacting the goingconcern status of the Company or its future operations
Extract of Annual Return
The information required under Section 134 of the Act readwith Rule 12 of the Companies (Management andAdministration) Rules 2014 is annexed
Particulars of Loans Guarantees or Investments
During the year ended 31st March 2019 the Company hasneither given any loan or guarantee nor has made anyinvestment under the provisions of Section 186 of the Act
Particulars relating to Conservation of Energy andTechnology Absorption
Particulars as required under Section 134 of the Act relatingto Conservation of Energy and Technology Absorption areprovided below-
Conservation of Energy
Steps taken on conservation of energy and impact thereof
Sl DescriptionNo
1 Installation of energy efficient Gas Burners and Induction Cooker
2 Improvement in energy usage efficiency in lighting system by changingover to efficient lighting solutions such as Light Emitting Diodes
3 Replacement of existing motors and pumps with more energy efficientequipment
4 Process improvement to enhance productivity and reduce specificenergy consumption
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
25
There were no employees who were employed throughoutthe year and were in receipt of remuneration aggregating` 102 crores or more or were employed for part of the yearand were in receipt of remuneration aggregating ` 850lakhs per month or more during the financial year ended31st March 2019
The information pursuant to Section 197 of the Act readwith Rule 5(2) and 5(3) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014containing the names of top 10 employees in terms ofremuneration drawn is provided in the Annexure formingpart of this report
The information required under Section 197(12) of the Actand the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is provided in theAnnexure forming part of this Report
FORWARD-LOOKING STATEMENTS
This Report contains forward-looking statements thatinvolve risks and uncertainties When used in this Reportthe words lsquoanticipatersquo lsquobelieversquo lsquoestimatersquo lsquoexpectrsquo lsquointendrsquolsquowillrsquo and other similar expressions as they relate to theCompany and or its Businesses are intended to identifysuch forward-looking statements The Companyundertakes no obligation to publicly update or revise anyforward-looking statements whether as a result of newinformation future events or otherwise Actual resultsperformances or achievements could differ materially fromthose expressed or implied in such forward-lookingstatements Readers are cautioned not to place unduereliance on these forward-looking statements that speakonly as of their dates This Report should be read inconjunction with the financial statements included hereinand the notes thereto
CONCLUSION
Your Directors and employees look forward to the futurewith confidence and stand committed to creating an evenbrighter future for all stakeholders
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
Steps taken by the Company for utilising alternate sourcesof energy NIL
Capital investment on energy conservation equipment NIL
Technology Absorption
i) Efforts in brief made towards technology absorptionand benefits derived as a result of the above effortseg product improvement cost reduction productdevelopment import substitution etc
Sl Description BenefitsNo
1 Upgradation of Fire Alarm and For Product UpgradationPublic Announcement system
2 Installation of Hoods and Fire For Product UpgradationSuppression system
3 Upgradation of CCTV monitoring For Product Upgradationsystem
4 Upgradation of Electrical Panel For Product Improvement5 Induction of Diesel Generator For Product Improvement
ii) In case of imported technology (imported during thelast 3 years reckoned from the beginning of the financialyear) following information may be furnished
A) Details of technology imported - NIL
B) Year of import - NIL
C) Whether the technology has been fully absorbed -NIL
D) If not fully absorbed areas where absorption hasnot taken place and the reasons therefor - NIL
iii) Expenditure incurred on research and development -NIL
FOREIGN EXCHANGE EARNINGS AND OUTGO
During the financial year 2018-19 foreign exchangeearnings of the Hotel aggregated ` 111754 lakhs (previousyear ` 95887 lakhs) while expenditure in foreign currencyaggregated ` 5514 lakhs (previous year ` 3230 lakhs)
EMPLOYEES
The total number of employees of the Company as on31st March 2019 stood at 198
26
ANNEXURE
FORM NO MR ndash 3SECRETARIAL AUDIT REPORTFOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019[Pursuant to Section 204(1) of the Companies Act 2013 and Rule9 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014]
ToThe MembersGujarat Hotels LimitedWe have conducted the secretarial audit of the compliance ofapplicable statutory provisions and the adherence to goodcorporate practices by Gujarat Hotels Limited a Companyincorporated under the provisions of the Companies Act 1956 andhaving its Registered Office at WelcomHotel Vadodara R C DuttRoad Alkapuri Vadodara Gujarat ndash 390 007 (hereinafter referredto as the lsquoCompanyrsquo) for the period commencing from 1st April2018 till 31st March 2019 (hereinafter referred to as the lsquoAuditPeriodrsquo) Secretarial Audit was conducted in a manner that providedus a reasonable basis for evaluating the corporate conducts statutory compliances and expressing our opinions thereonBased on our verification of the books papers minute booksforms and returns filed and other records maintained by theCompany and also the information provided by the Company itsofficers agents and authorised representatives during the conductof Secretarial Audit 2018-19 we hereby report that in our opinionthe Company has during the audit period covering the FinancialYear ended on 31st March 2019 complied with the statutoryprovisions listed hereunder and also that the Company has properBoard-processes and compliance-mechanism in place to theextent in the manner and subject to the reporting made hereinafterWe have examined the books papers minute books forms andreturns filed and other records maintained by the Company for thefinancial year ended on 31st March 2019 according to theprovisions of(i) The Companies Act 2013 (the Act) and the Rules made
thereunder(ii) The Securities Contracts (Regulation) Act 1956 (lsquoSCRArsquo)
and the Rules made thereunder(iii) The Depositories Act 1996 and the Regulations and
Bye-laws framed thereunder(iv) Foreign Exchange Management Act 1999 and the Rules and
Regulations made thereunder to the extent of Foreign DirectInvestment Overseas Direct Investment and ExternalCommercial Borrowings
(v) The following Regulations and Guidelines prescribed underthe Securities and Exchange Board of India Act 1992(lsquoSEBI Actrsquo)-(a) The Securities and Exchange Board of India
(Substantial Acquisition of Shares and Takeovers)Regulations 2011
(b) The Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations 2015
(c) The Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations2015
(d) The Securities and Exchange Board of India(Registrars to an Issue and Share Transfer Agents)Regulations 1993 regarding the Companies Act anddealing with client
We have also examined compliance with the applicable clauses ofthe following(i) The mandatory Secretarial Standards issued by The Institute
of Company Secretaries of India with respect to BoardMeetings and General Meetings
(ii) The SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015
The Company has entered into an Operating Licence Agreementwith ITC Limited which operates the Hotel ndash WelcomHotel Vadodraand ensure compliance of all laws as applicable for running andmaintenance of the HotelDuring the period under review the Company has complied withthe provisions of the Act Rules Regulations Guidelines andStandards etc as mentioned above however in the CorporateGovernance Report filed pursuant to Regulation 27(2) of SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015with BSE for the quarter ended September and December 2018there is mismatch of date of the meetingWe further report thatThe Board of Directors of the Company is duly constituted withproper balance of Non-Executive Directors and IndependentDirectors The changes in the composition of the Board of Directorsthat took place during the period under review were carried out incompliance with provisions of the ActAdequate notice is given to all Directors for the Board Meetingsand Committees Meetings agenda and detailed notes on agendawere sent at least seven days in advance and where the meetingwas held in shorter notice due compliance was made and a systemexists for seeking and obtaining further information and clarificationson the agenda items before the meeting for meaningful participationat the meetingAll decisions at Board Meetings and Committee Meetings werecarried out unanimously as recorded in the minutes of the meetingsof the Board of Directors or Committees of the Board as the casemay beWe report that there are adequate systems and processes in theCompany commensurate with the size and operations of theCompany to monitor and ensure compliance with the applicableLaws Rules Regulations and GuidelinesWe further report that during the Audit Period the Company has nospecific events actions that have a major bearing on the Companyrsquosaffairs in pursuance of the above referred Laws RulesRegulations Guidelines Standards etc
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
Note This report is to be read with our letter of even date whichis annexed as Annexure A and forms an integral part of thisreport
27
FORM NO AOC-2[Pursuant to Section 134(3)(h) of the Companies Act 2013 and Rule 8(2) of the Companies (Accounts) Rules 2014]
Form for disclosure of particulars of contracts arrangements entered into by the Company with related parties referred to insub-section (1) of Section 188 of the Companies Act 2013 including certain arms length transactions under fourth proviso thereto
1 Details of contracts or arrangements or transactions not at arms length basis
a) Name(s) of the related party and nature of relationshipb) Nature of contracts arrangements transactionsc) Duration of the contracts arrangements transactionsd) Salient terms of the contracts or arrangements or transactions including the value if anye) Justification for entering into such contracts or arrangements or transactions NILf ) Date(s) of approval by the Boardg) Amount paid as advances if anyh) Date on which the special resolution was passed in general meeting as required under first proviso to Section 188
2 Details of material contracts or arrangement or transactions at arms length basis
a) Name(s) of the related party and nature of ITC Limited of which the Company is an Associaterelationship
b) Nature of contracts arrangements transactions Agreement for operating the Companyrsquos Hotel
c) Duration of the contracts arrangements Operating License Agreement (OLA) dated 24th September 1992 for an initialtransactions period of 30 years and renewable for another period of 30 years The OLA
emanated from the rehabilitation package agreed amongst Gujarat State GovtFinancial Institutions viz IFCI amp SBI and ITC in the year 1990
d) Salient terms of the contracts or arrangements The Company receives Licence fees 15 of Net Operating Income Valueor transactions including the value if any of transaction during the year ` 370 crores
e) Date(s) of approval by the Board if any 24th September 1992f ) Amount paid as advances if any Nil
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Annexure AToThe MembersGujarat Hotels Limited
Our report of even date is to be read along with this letter
1 Maintenance of secretarial record is the responsibilityof the management of the Company Our responsibilityis to express an opinion on these secretarial recordsbased on our audit
2 We have followed the audit practices and processesas were appropriate to obtain reasonable assuranceabout the correctness of the contents of the secretarialrecords The verification was done on the randomtest basis to ensure that correct facts are reflected insecretarial records We believe that the processesand practices we followed provide a reasonablebasis for our opinion
3 W e have not verified the correctness andappropriateness of financial records and books ofaccounts of the Company
4 W herever required we have obtained theManagement Representation about the complianceof Laws Rules and Regulations and happening ofevents etc
5 The compliance of the provisions of corporate andother applicable Laws Rules RegulationsStandards is the responsibility of management Ourexamination was limited to the verification ofprocedures on the random test basis
6 The Secretarial Audit Report is neither an assuranceas to the future viability of the Company nor of theefficacy or effectiveness with which the managementhas conducted the affairs of the Company
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
28
INDEPENDENT AUDITORSrsquo CERTIFICATE ON CORPORATE GOVERNANCE
INDEPENDENT AUDITORrsquoS CERTIFICATE ON CORPORATEGOVERNANCE
TO THE MEMBERS OF GUJARAT HOTELS LIMITED
1 We have examined the compliance of conditions ofCorporate Governance by Gujarat Hotels Limited (ldquotheCompanyrdquo) for the year ended on 31st March 2019as stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the Securities and Exchange Board ofIndia (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended(ldquoSEBI Listing Regulationsrdquo)
Managementrsquos Responsibility
2 The compliance of conditions of CorporateGovernance is the responsibility of the ManagementThis responsibility includes the designimplementation and maintenance of internal controland procedures to ensure the compliance with theconditions of the Corporate Governance stipulated inSEBI Listing Regulations
Auditorrsquos Responsibility
3 Our responsibility is limited to examining theprocedures and implementation thereof adopted bythe Company for ensuring the compliance of theconditions of the Corporate Governance It is neitheran audit nor an expression of opinion on the financialstatements of the Company
4 We have examined the books of account and otherrelevant records and documents maintained by theCompany for the purpose of providing reasonableassurance on the compliance with CorporateGovernance requirements by the Company
5 We have carried out an examination of the relevantrecords of the Company in accordance with theGuidance Note on Certification of CorporateGovernance issued by the Institute of CharteredAccountants of India (ldquothe ICAIrdquo) the Standards onAuditing specified under Section 143(10) of theCompanies Act 2013 in so far as applicable for the
purpose of this certificate and as per the GuidanceNote on Reports or Certificates for Special Purposesissued by the ICAI which requires that we comply withthe ethical requirements of the Code of Ethics issuedby the ICAI
6 W e have complied with the relevant applicablerequirements of the Standard on Quality Control (SQC)1 Quality Control for Firms that Perform Audits andReviews of Historical Financial Information and otherAssurance and Related Services Engagements
Opinion
7 Based on our examination of the relevant recordsand according to the information and explanationsprovided to us and representations provided by theManagement we certify that the Company hascomplied with the conditions of Corporate Governanceas stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the SEBI Listing Regulations asapplicable for the year ended 31st March 2019
8 W e state that such compliance is neither anassurance as to the future viability of the Companynor the efficiency or effectiveness with which theManagement has conducted the affairs of theCompany
Restrictions on Use
9 This Certificate is issued solely for the purpose ofcomplying with the aforesaid SEBI ListingRegulations and may not be suitable for any otherpurpose
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
29
ANNEXURE
FORM NO MGT-9EXTRACT OF ANNUAL RETURN
as on the Financial Year ended on 31st March 2019[Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the
Companies (Management and Administration) Rules 2014]
I REGISTRATION AND OTHER DETAILS
i) CIN L55100GJ1982PLC005408ii) Registration Date 7th August 1982iii) Name of the Company Gujarat Hotels Limitediv) Category Sub-Category of the Company Public company - Limited by sharesv) Address of the Registered office and contact details WelcomHotel Vadodara
R C Dutt Road AlkapuriVadodara 390 007Tel No 0265-233 0033E-mail ghlinvestorsyahoocoin
vi) Whether Listed Company Yesvii) Name Address and Contact details of MCS Share Transfer Agent Limited
Registrar and Transfer Agent if any F - 65 Okhla Industrial Area Phase - INew Delhi - 110 020Tel Nos (011) 4140 6149-52 4160 9386
II PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY
III PARTICULARS OF HOLDING SUBSIDIARY AND ASSOCIATE COMPANIES NIL
Sl No
Name and Description of main products services NIC Code of the products services
to total turnover of the Company
1 Hotel Services 55101 100
30
IV SHAREHOLDING PATTERN (Equity Share Capital Break-up as percentage of Total Equity)(i) Category-wise Shareholding
Category of Shareholders No of Shares held at the beginningof the year
No of Shares held at the endof the year
Changeduring the
year
A Promoters(1) Indiana) Individual HUF 0 0 0 0 0 0 0 0 0b) Central Govt 0 0 0 0 0 0 0 0 0c) State Govt(s) 0 0 0 0 0 0 0 0 0d) Bodies Corp 2033963 0 2033963 5370 2033963 0 2033963 5370 0e) Banks FI 0 0 0 0 0 0 0 0 0f ) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(1) 2033963 0 2033963 5370 2033963 0 2033963 5370 0(2) Foreigna) NRIs - Individuals 0 0 0 0 0 0 0 0 0b) Other - Individuals 0 0 0 0 0 0 0 0 0c) Bodies Corp 0 0 0 0 0 0 0 0 0d) Banks FI 0 0 0 0 0 0 0 0 0e) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(2) 0 0 0 0 0 0 0 0 0Total Shareholding of Promoter(A) = (A)(1)+(A)(2) 2033963 0 2033963 5370 2033963 0 2033963 5370 0B Public Shareholding1 Institutionsa) Mutual Funds 0 0 0 0 0 0 0 0 0b) Banks FI 0 100 100 0 100 100 c) Central Govt 0 0 0 0 0 0 0 0 0d) State Govt(s) 0 0 0 0 0 0 0 0 0e) Venture Capital Funds 0 0 0 0 0 0 0 0 0f ) Insurance Companies 0 0 0 0 0 0 0 0 0g) FIIs 10 0 10 0 0 0 h) Foreign Venture Capital Funds 0 0 0 0 0 0 0 0 0i) Others (specify) 0 0 0 0 0 0 0 0 0Sub-total (B)(1) 10 100 110 0 100 100 2 Non-Institutionsa) Bodies Corpi) Indian 300003 2200 302203 798 191626 2100 193726 511 (287)ii) Overseas 0 0 0 0 0 0 0 0 0b) Individualsi) Individual shareholders holding
nominal share capital upto` 1 lakh 774322 231562 1005884 2656 797094 203602 1000696 2643 (013)
ii) Individual shareholders holdingnominal share capital inexcess of ` 1 lakh 220814 0 220814 583 334765 0 334765 884 301
c) Others (specify)i) Non Resident Individuals 44288 71500 115788 306 45662 56700 102362 270 (036)ii) Investor Education and
Protection Fund AuthorityMinistry of Corporate Affairs 108753 0 108753 287 121903 0 121903 322 035
Sub-total (B)(2) 1448180 305262 1753442 4630 1491050 262402 1753452 4630 0Total Public Shareholding(B)=(B)(1)+ (B)(2) 1448190 305362 1753552 4630 1491050 262502 1753552 4630 0C Shares held by Custodian
for GDRs amp ADRs 0 0 0 0 0 0 0 0 0Grand Total (A+B+C) 3482153 305362 3787515 100 3525013 262502 3787515 100 0
Demat Physical Total of TotalShares
Demat Physical Total of TotalShares
ANNEXURE
31
1 Savi Portfolio Management Services LimitedAt the beginning of the year 122218 323Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 122218 323
2 Muktilal Ganulal PaldiwalAt the beginning of the year 82742 218Increase Decrease in Shareholding during the year06042018 220 001 82962 21913042018 250 001 83212 22001062018 927 002 84139 22215062018 700 002 84839 22427072018 412 001 85251 22505102018 1000 003 86251 22830112018 500 001 86751 22931122018 958 003 87709 23218012019 124 000 87833 23208022019 1070 003 88903 23501032019 467 001 89370 23615032019 1000 003 90370 23922032019 200 001 90570 24031032019 50 000 90620 240At the end of the year 90620 240
3 Taradevi Muktilal PaldiwalAt the beginning of the year 31628 084
(ii) Shareholding of Promoters (including Promoter Group)
(iii) Change in Promotersrsquo Shareholding (please specify if there is no change)
SlNo
Shareholders NameNo of
Shares of total
Sharesof the
Company
of Sharespledged
encumbered tototal Shares
No ofShares
of totalShares
of theCompany
of Sharespledged
encumbered tototal Shares
change inShareholding
during the year
1 ITC Limited 1733907 4578 Nil 1733907 4578 Nil Nil
2 Russell Investments Limited 300056 792 Nil 300056 792 Nil Nil
Shareholding at the beginning of the year Shareholding at the end of the year
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
(iv) Shareholding Pattern of top ten Shareholders (other than Directors Promoters and Holders of GDRs and ADRs)
ANNEXURE
No of Shares
Sl No
Particulars Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares of total Shares of the Company
No of Shares of total Shares of the Company
At the beginning of the year
No Change during the year Increase Decrease in Promoters Shareholding during the year
At the end of the year
32
Increase Decrease in Shareholding during the year06042018 180 000 31808 08413042018 53 000 31861 08420042018 1449 004 33310 08827042018 1933 005 35243 09304052018 1060 003 36303 09611052018 2196 006 38499 10218052018 1343 004 39842 10625052018 1191 003 41033 10906072018 1600 004 42633 11313072018 1678 004 44311 11720072018 2095 006 46406 12327072018 3735 010 50141 13303082018 415 001 50556 13410082018 685 002 51241 13624082018 1169 003 52410 13931082018 1616 004 54026 14307092018 1655 004 55681 14714092018 1311 003 56992 15021092018 2480 007 59472 15729092018 2259 006 61731 16305102018 1534 004 63265 16712102018 976 003 64241 17019102018 64 000 64305 17026102018 600 002 64905 17202112018 605 002 65510 17409112018 4 000 65514 17416112018 143 000 65657 17430112018 2299 006 67956 18007122018 515 001 68471 18114122018 10 000 68481 18121122018 590 002 69071 18331122018 600 002 69671 18504012019 1000 003 70671 18825012019 21 000 70692 18801022019 701 002 71393 19008022019 388 001 71781 19115022019 714 002 72495 19301032019 700 002 73195 19515032019 34 000 73229 195At the end of the year 73299 195
4 Shah Viren ShantilalAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 14122018 26965 071
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
ANNEXURE
33
Increase Decrease in Shareholding during theyear ie wef 1412201811012019 28946 076 55911 14701022019 7194 019 63105 166At the end of the year 63105 166
5 Chirayush Pravin VakilAt the beginning of the year 27482 073Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 27482 073
6 Falguni Nilesh DedhiaAt the beginning of the year 18000 048Increase Decrease in Shareholding during the year27042018 5175 014 23175 062At the end of the year 23175 062
7 Classic Realties Private LimitedAt the beginning of the year 23061 061Increase Decrease in Shareholding during the year31082018 100 000 23161 061At the end of the year 23161 061
8 Dheeraj Kumar LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 20000 053
9 Karvy Stock Broking LimitedAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 30112018 23063 061Increase Decrease in Shareholding during theyear ie wef 3011201807122018 149 000 23212 06114122018 (8165) (022) 15047 03931122018 7128 019 22175 05804012019 3087 008 25262 06611012019 (23721) (063) 1541 00331032019 15274 040 16815 043At the end of the year 16815 043 Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company Includes shares acquired during the period when not part of the top ten Shareholders of the Company
10 Sonal LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year20042018 (1000) (003) 19000 050
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
34
311218 0 000 0 00011012019 0 000 0 00031032019 (5000) (013) 14000 037At the end of the year 14000 037 Ceased to be part of the top ten Shareholders of the Company Became a part of the top ten Shareholders of the Company
11 Rajasthan Global Securities Private LimitedAt the beginning of the year 98659 260Increase Decrease in Shareholding during the year20042018 (4756) (013) 93903 24727042018 (5596) (015) 88307 23206072018 (790) (002) 87517 23027072018 (8520) (022) 78997 20802112018 (10975) (029) 68022 17916112018 (4) 000 68018 17930112018 (6189) (016) 61829 16307122018 (170) 000 61659 16314122018 (18503) (049) 43156 11421122018 (417) (001) 42739 11331122018 (11108) (029) 31631 08404012019 (5000) (013) 26631 07111012019 (5000) (013) 21631 05825012019 (2800) (007) 18831 05101022019 0 000 0 000At the end of the year NA NA Ceased to be a part of the top ten Shareholders of the Company
12 Dinesh Mukilal PaldiwalAt the beginning of the year 10522 028Increase Decrease in Shareholding during the year03082018 112 000 10634 02810082018 424 001 11058 02907092018 500 001 11558 03021092018 85 000 11643 03005102018 1000 003 12643 03302112018 0 000 12643 03301022019 0 000 12643 03315022019 300 001 12943 03431032019 0 000 12943 034At the end of the year NA NA Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company
Note Increase decrease in shareholding as indicated above are based on downloads of beneficial ownership provided by the Depositories generally everyFriday
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
35
(v) Shareholding of Directors and Key Managerial Personnel
ANNEXURE
Ms D R Choudhury Messrs C K Koshy R C Mehta M Narayanan and J Singh Directors Messrs M Agarwal andD K Gulati Key Managerial Personnel did not hold any Shares of the Company either at the beginning or at the end of theyear or at any time during the year
Mr K Pahwa Chief Executive Officer also did not hold any Shares of the Company either at the time of his appointment or atthe end of the year or at any time during the year
V INDEBTEDNESSIndebtedness of the Company including interest outstanding accrued but not due for payment NIL
VI REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNELA Remuneration to Managing Director Wholetime Directors and or Manager NOT APPLICABLE
B Remuneration to the other Directors(Amount in `)
Ceased to be Non-Executive Independent Director with close of work on 31st March 2019
Sl No For each of the Director
Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares held singly
jointly
of total Shares of the
Company
No of Shares held singly
jointly
of total Shares of the
Company
1 N Anand (Chairman)
At the beginning of the year 200 0
Increase Decrease in Shareholding during the year
0 0 0 0
At the end of the year 200 0
Sl No Directors
Particulars of Remuneration
Total Amount Fee for attending Board Board
Committee Meetings
Commission Independent Directors
Meeting Fees 1 Independent Directors
C K Koshy 140000 0 10000 150000 R C Mehta 70000 0 0 70000 M Narayanan 140000 0 10000 150000
Total (B)(1) 350000 0 20000 370000 2 Other Non-Executive Directors
N Anand 0 0 0 0 D R Choudhury 0 0 0 0 J Singh 0 0 0 0
Total (B)(2) 0 0 0 0 Total (B) = (B)(1) + (B)(2) 370000 Total Managerial Remuneration (A+B) 370000
Overall ceiling as per the Act (Being 11 of the Net Profits of the Company as calculated under Section 198 of the Companies Act 2013)
3759620
36
C Remuneration to Key Managerial Personnel other than MD Manager WTD(Amount in `)
Mr K Pahwa was appointed as Chief Executive Officer wef 1st February 2019
VII PENALTIES PUNISHMENT COMPOUNDING OF OFFENCES
against the Company Directors and other Officers in Default under the Companies Act 2013 NONE
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Sl No
Particulars of Remuneration Key Managerial Personnel
Total Amount
K Pahwa Chief Executive
Officer
M Agarwal Chief Financial
Officer
D K Gulati Company Secretary
1 Gross Salary
(a) Salary as per provisions contained in Section 17(1) of the Income-tax Act 1961
377472 2883242 880140 4140854
(b) Value of perquisites under Section 17(2) of the Income-tax Act 1961
242908 136154 0 379062
(c) Profits in lieu of salary under Section 17(3) of the Income-tax Act 1961
0 0 0 0
2 Stock Option 0 0 0 0 3 Sweat Equity 0 0 0 0 4 Commission
- as of profit - others specify
0 0 0 0
5 Others please specify 0 0 0 0 Total Amount 620380 3019396 880140 4519916
37
Services reverted to ITC Limited effective 17th December 2018 Reflects revision in remuneration effective 1st October 2018
Notes1 The number of permanent employees as on 31st March 2019 was 1982 Compared to 2017-18 the figures for 2018-19 reflect that
i) Median remuneration of employees - Increased by 965ii) Average remuneration of employees excluding Key Managerial Personnel (KMP) - Increased by 1040 with
increase in number of employeesiii) Remuneration of KMP - Increased by 1321 due to revision in remuneration during the year
3 Remuneration of Directors KMP and other employees is in accordance with the Companys Remuneration Policy
A Information pursuant to Section 197 of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014
Name of Directors ampKey ManagerialPersonnel
Designation Ratio of Remuneration toMedian Remuneration of
all employees
Increase inRemuneration over
LY ()
ANNEXURE
N Anand Non-Executive Chairman - -
D R Choudhury Non-Executive Director - -
C K Koshy Independent Director 0731 7
R C Mehta Independent Director 0341 -
M Narayanan Independent Director 0731 7
J Singh Non-Executive Director - -
D Rana Chief Executive Officer 12681 (15)
K Pahwa Chief Executive Officer (wef 1st February 2019) 3111 -
M Agarwal Chief Financial Officer 15281 24
D K Gulati Company Secretary 4371 8
38
O
n de
puta
tion
from
ITC
Lim
ited
(ITC
)
Ser
vice
s re
verte
d to
ITC
effe
ctiv
e 17
th D
ecem
ber
2018
N
otes
a
Gro
ss r
emun
erat
ion
incl
udes
sal
ary
var
iabl
e pa
y C
ompa
nys
con
tribu
tion
to p
rovi
dent
fun
d a
llow
ance
s amp
oth
er b
enef
its
app
licab
le p
erqu
isite
s ex
cept
pro
visi
ons
for
grat
uity
and
leav
e en
cash
men
t w
hich
are
act
uaria
lly d
eter
min
ed o
n an
ove
rall
Com
pany
bas
is
The
ter
m r
emun
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ion
has
the
mea
ning
ass
igne
d to
it
unde
r th
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ompa
nies
Act
20
13
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et r
emun
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ion
com
pris
es c
ash
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less
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ome
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ded
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d at
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and
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All
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n ac
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per
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ules
d
The
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e ne
ither
rel
ativ
e of
any
Dire
ctor
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d an
y eq
uity
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re i
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e C
ompa
ny
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form
atio
n pu
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nt t
o Se
ctio
n 19
7 of
the
Com
pani
es A
ct 2
013
read
with
Rul
es 5
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and
5(3)
of
the
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App
oint
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t an
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emun
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ion
of M
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eria
l Per
sonn
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ules
201
4
On
beha
lf of
the
Boa
rd
Pla
ce
New
Del
hiD
R C
houd
hury
J S
ingh
Dat
e 1
5th
Apr
il 2
019
Dire
ctor
Dire
ctor
Desig
natio
nGr
oss
Rem
uner
atio
n(`
)
Net
Rem
uner
atio
n(`
)
Quali
ficat
ions
Date
ofco
mmen
ceme
ntof
empl
oym
ent
depu
tatio
n
Prev
ious
Em
ploy
men
t Po
sitio
n He
ld
34
56
78
9
Expe
rienc
e(Y
ears
)Na
meAg
e
12
Top
ten
empl
oyee
s in
term
s of r
emun
erat
ion
draw
nMa
yur A
garw
al33
Chief
Fina
ncial
Offic
er31
5115
622
2466
8B
Com
A
CA
9
2501
2017
ITC
Limite
dC
SMa
nage
r - Fi
nanc
eDe
epen
dra R
ana
38
Chief
Exe
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e Of
ficer
2615
119
1426
865
Dip
in Ho
tel
1625
0120
17IT
C Lim
ited
Mana
gmen
tGe
nera
l Man
ager
Deep
ak K
umar
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ti33
Comp
any
Secr
etary
9017
4083
9928
BCo
m
AC
S
701
0720
15Re
ligar
e Sec
uritie
s Lim
ited
LLB
Ma
nage
r - C
ompli
ance
Rosh
an Ja
cob R
ajan
31As
sistan
t Man
ager
7366
8164
6118
BB
A P
GD
M
501
0320
18Th
e Fer
n Hote
l(M
arke
ting)
Sales
Man
ager
Kuna
l Pah
wa
37Ch
ief E
xecu
tive
Offic
er64
0997
2173
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l15
0102
2019
ITC
Limite
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ent
Gene
ral M
anag
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engu
pta47
Exec
utive
4183
8535
8861
BCo
m
2613
0519
95Jin
dal H
otels
Limite
dFr
ont o
ffice A
ssist
ant
Rajar
am K
ashir
am B
abar
52Se
nior E
xecu
tive
4175
8231
7347
BCo
m
2201
1220
16Ho
tel K
avira
j Ex
ecuti
veVa
sund
hara
Son
awan
e52
Exec
utive
4010
0533
6903
HSC
Cer
tifica
te29
0104
1993
Nil
Cour
se in
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Vada
nsing
h Gum
ansin
gh55
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r Ex
ecuti
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9706
3139
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el38
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ent
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r Cap
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in Ma
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r36
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dard
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86Do
dsal
Comp
any
Weld
er
INFORMATION US 197 OF THE COMPANIES ACT 2013
39
CEO AND CFO COMPLIANCE CERTIFICATE
We Kunal Pahwa Chief Executive Officer and Mayur Agarwal Chief Financial Officer certify that
a) We have reviewed the financial statements including the cash flow statement for the year ended 31st March 2019 andto the best of our knowledge and belief
i) these statements do not contain any materially untrue statement or omit any material fact or contain statementsthat might be misleading
ii) these statements together present a true and fair view of the Companyrsquos affairs and are in compliance with IndianAccounting Standards applicable laws and regulations
b) To the best of our knowledge and belief no transactions entered into by the Company during the year ended31st March 2019 are fraudulent illegal or violative of the Companyrsquos code of conduct
c) We accept responsibility for establishing and maintaining internal controls for financial reporting and we have evaluatedthe effectiveness of the internal control systems of the Company pertaining to financial reporting Deficiencies in thedesign or operation of such internal controls if any of which we are aware have been disclosed to the auditors and theAudit Committee and steps have been taken to rectify these deficiencies
d) i) There has not been any significant change in internal control over financial reporting during the year underreference
ii) The changes in the Significant Accounting Policies arising from the adoption of the Indian Accounting Standardshave been discussed with the auditors and have been approved by the Audit Committee and
iii) We are not aware of any instance during the year of significant fraud with involvement therein of the managementor any employee having a significant role in the Companyrsquos internal control system over financial reporting
Place New Delhi Kunal Pahwa Mayur AgarwalDate 15th April 2019 Chief Executive Officer Chief Financial Officer
40
BALANCE SHEET
As at 31st March 2019Amount in `
Particulars Note As at As at31st March 2019 31st March 2018
ASSETSNon-Current Assetsa) Property Plant and Equipment 2 14695652 15623727b) Other Non-Current Assets 3 6672434 7609451Total Non-Current Assets 21368086 23233178Current Assetsa) Financial Assets
(i) Investments 4 280294894 208482957(ii) Trade Receivables 5 16310661 14154244(iii) Cash and Cash Equivalents 6 763039 900355(iv) Other Bank Balances 7 5489856 53182631(v) Other Financial Assets 8 4724316 6349124
b) Other Current Assets 3 437564 406324Total Current Assets 308020330 283475635Total Assets 329388416 306708813EQUITY AND LIABILITIESEquitya) Equity Share Capital 9 37875150 37875150b) Other Equity 268275037 243468594Total Equity 306150187 281343744LIABILITIESNon-Current Liabilitiesa) Provisions 10 1399224 1270990b) Deferred Tax Liabilities (Net) 11 10745247 11364002Total Non-Current Liabilities 12144471 12634992Current Liabilitiesa) Financial Liabilities
(i) Trade Payablesa) Total outstanding dues of micro enterprises and
small enterprises ndash ndashb) Total outstanding dues of creditors other than
micro enterprises and small enterprises 483074 395920(ii) Other Financial Liabilities 12 9272344 11118126
b) Other Current Liabilities 13 1264039 1172866c) Provisions 10 74301 43165Total Current Liabilities 11093758 12730077Total Equity And Liabilities 329388416 306708813
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
41
STATEMENT OF PROFIT AND LOSS
For the year ended 31st March 2019Amount in `
I Revenue From Operations 14 36986948 33098499
II Other Income 15 19625544 17119109
III Total Income (I+II) 56612492 50217608
IV EXPENSES
Employee Benefits Expense 16 1208580 1094609
Depreciation and Amortization Expense 473636 475984
Other Expenses 17 3107913 3334087
Total Expenses (IV) 4790129 4904680
V Profit Before Tax (III- IV) 51822363 45312928
VI Tax Expense
Current Tax 18 11653499 9272310
Deferred Tax 18 (618755) 2350502
VII Profit for the Year (V-VI) 40787619 33690116
VIII Other Comprehensive Income ndash ndash
IX Total Comprehensive Income for the Year (VII+VIII) 40787619 33690116
X Earnings per Equity Share (Face Value ` 10-each) 19
Basic (in `) 1077 890
Diluted (in `) 1077 890
For the Year For the YearParticulars Note ended ended
31st March 2019 31st March 2018
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
42
For the year ended 31st March 2019
STATEMENT OF CHANGES IN EQUITY
The Board of Directors of the Company recommended a dividend of ` 35 per share (for the year ended 31st March 2018 - dividend ` 350 pershare) be paid on fully paid equity shares This equity dividend is subject to approval by shareholders at the Annual General MeetingThe totalequity dividend to be paid ` 13256303 (for the year ended 31st March 2018 - dividend ` 13256303) Income tax on proposed dividend being` 2724873 (for the year ended 31st March 2018 - ` 2724873)
General Reserve This Reserve is created by an appropriation from one component of equity (generally retained earnings) to another notbeing an item of Other Comprehensive Income The same can be utilized by the Company in accordance with the provisions of the CompaniesAct 2013
Retained Earnings This Reserve represents the cumulative profits of the Company This Reserve can be utilized in accordance with theprovisions of the Companies Act 2013
The accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even dateOn behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
A Equity Share CapitalAmount in `
Balance as at the Changes in equity Balance at thebeginning of the share capital end of the
reporting year during the year reporting yearFor the year ended 31st March 2018 37875150 ndash 37875150For the year ended 31st March 2019 37875150 ndash 37875150
B Other EquityAmount in `
Reserves amp Surplus TotalGeneral Reserve Retained Earnings
Balance as at April 01 2017 30257504 195873461 226130965Total Comprehensive Income for the year ndash 33690116 33690116Dividend ndash 13256303 13256303Income Tax on Dividend Paid ndash 2698671 2698671Dividend Distribution Tax (earlier year) ndash 397513 397513Balance as at March 31 2018 30257504 213211090 243468594Balance as at April 01 2018 30257504 213211090 243468594Total Comprehensive Income for the year ndash 40787619 40787619Dividend ndash 13256303 13256303Income Tax on Dividend Paid 2724873 2724873Balance as at March 31 2019 30257504 238017533 268275037
43
CASH FLOW STATEMENT
For the year ended 31st March 2019
For the Year For the YearParticulars ended ended
31st March 2019 31st March 2018
NOTES1) The above Cash Flow Statement has been prepared under the ldquoIndirect Methodrdquo as set out in Ind AS 7Statement of Cash FlowsrdquoThe accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even date On behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
Amount in `
A Cash Flow from Operating ActivitiesPROFIT BEFORE TAX 51822363 45312928Adjustments for
Depreciation amp Amortisation expense 473636 475984Interest Income (1317822) (3453950)Dividend Income (159984) (178075)Loss on sale of property plant and equipment - Net 445778 (28273)Net gain(loss) on investments mandatorily measuredat fair value through profit or loss (18005340) (13358789)Other Non Operating Income ndash (86856)Other Non Operating Expense ndash 99378
OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 33258631 28782347Adjustments for
Trade Receivables Financial Assets and Other Assets (2815198) (90661)Trade Payables Other Liabilities and Provisions (1568800) 1700052
CASH GENERATED FROM OPERATIONS 28874633 30391738Income Tax Paid(Net) (10407981) (12740273)
NET CASH FROM OPERATING ACTIVITIES 18466652 17651465B Cash Flow from Investing Activities
Sale of Property Plant and Equipment 8661 58452Purchase of Current Investments (224340000) (186220000)SaleRedemption of Current Investments 170532754 183295529Dividend Income 159984 178075Interest Received 3262318 4031382
NET CASH FROM INVESTING ACTIVITIES (50376283) 1343438C Cash Flow from Financing Activities
Dividend Paid (13256303) (13256303)Income Tax on Dividend Paid (2724873) (2698671)
NET CASH FROM FINANCING ACTIVITIES (15981176) (15954974)NET INCREASE IN CASH AND CASH EQUIVALENTS (47890807) 3039929OPENING CASH AND CASH EQUIVALENTS 48653846 45613917CLOSING CASH AND CASH EQUIVALENTS 763039 48653846
CASH AND CASH EQUIVALENTS COMPRISE Cash cheques and current accounts 763039 900355Other Bank BalancesDeposits with original maturity more than 3 months having remainingmaturity less than 12 months from Balance Sheet date ndash 47753491
763039 48653846
44
1 SIGNIFICANT ACCOUNTING POLICIESStatement of ComplianceThese financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) notifiedunder section 133 of the Companies Act 2013 (the Act) read with Companies (Indian Accounting Standards)Rules 2015 (as amended) The financial statements have also been prepared in accordance with the relevantpresentation requirements of the Companies Act 2013
Basis of PreparationThe financial statements are prepared in accordance with the historical cost convention except for certain itemsthat are measured at fair values as explained in the accounting policies below The financial statements arepresented in Indian Rupees (INR) which is also the Companyrsquos functional currency
Fair Value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transactionbetween market participants at the measurement date regardless of whether that price is directly observable orestimated using another valuation technique In estimating the fair value of an asset or a liability the Companytakes into account the characteristics of the asset or liability if market participants would take those characteristicsinto account when pricing the asset or liability at the measurement date
The preparation of financial statements in conformity with Ind AS requires management to make judgementsestimates and assumptions that affect the application of the accounting policies and the reported amounts ofassets and liabilities the disclosure of contingent assets and liabilities at the date of the financial statementsand the reported amounts of revenues and expenses during the year Actual results could differ from those estimatesThe estimates and underlying assumptions are reviewed on an ongoing basis Revisions to accounting estimatesare recognised in the period in which the estimate is revised if the revision affects only that period they arerecognised in the period of the revision and future periods if the revision affects both current and future periods
All assets and liabilities have been classified as current or non-current as per the Companyrsquos normal operatingcycle and other criteria set out in the Schedule III to the Companies Act 2013 and Ind AS 1 ndash Presentation ofFinancial Statements based on the nature of business and the time between the acquisition of assets for processingand their realisation in cash and cash equivalents
Property Plant amp Equipment ndash Tangible AssetsProperty plant amp equipment are stated at cost of acquisition or construction less accumulated depreciation andimpairment if any For this purpose cost includes deemed cost which represents the carrying value of propertyplant and equipment recognised as at 1st April 2015 measured as per the previous GAAP
Cost is inclusive of inward freight duties and taxes and incidental expenses related to acquisition In respect ofmajor projects involving construction related pre-operational expenses form part of the value of assets capitalisedExpenses capitalised also include applicable borrowing costs for qualifying assets if any Subsequent costs areincluded in the assetrsquos carrying amount only when it meets the recognition criteria are met as per componentaccounting The carrying amount of a replaced part is derecognized All other repairs and maintenance are chargedto the statement of Profit amp Loss
An item of property plant and equipment is derecognized upon disposal or when no future economic benefits areexpected to arise from the continued use of asset Any gain or loss arising on the disposal or retirement of an itemof property plant and equipment is determined as the difference between the sales proceeds and the carryingamount of the asset and is recognised in Statement of Profit and Loss
Depreciation of these assets commences when the assets are ready for their intended use which is generally oncommissioning Items of Property Plant and Equipment are depreciated in a manner that depreciates the cost ofthe assets after commissioning (or other amount substituted for cost) less its residual value over their usefullives as specified in Schedule II of the Companies Act 2013 on a straight line basis
Property plant and equipmentrsquosrsquo residual values and useful lives are reviewed at each balance sheet date andchanges if any are treated as changes in accounting estimate
NOTES TO THE FINANCIAL STATEMENTS
45
NOTES TO THE FINANCIAL STATEMENTS
Useful lives of different class of PPE are as follows
Particulars Useful Life as per Schedule IIBuilding 60 Years
Plant and Equipment 15 Years
Furnitures and fixtures 8 years
Office equipment 5 Years
Impairment of AssetsImpairment loss is provided if any to the extent the carrying amount of assets or cash generating units exceedtheir recoverable amount
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amountmay not be recoverable
Recoverable amount is higher of an assetrsquos net selling price and its value in use Value in use is the present valueof estimated future cash flows expected to arise from the continuing use of an asset or cash generating unit andfrom its disposal at the end of its useful life
Impairment losses recognised in prior years are reversed when there is an indication that the impairment lossesrecognised no longer exist or have decreased Such reversals are recognised as an increase in carrying amountsof assets to the extent that it does not exceed the carrying amounts that would have been determined (net ofamortisation or depreciation) had no impairment loss been recognised in previous years
Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodiedin the asset are considered to modify the amortisation period or method as appropriate and are treated aschanges in accounting estimates
Financial instruments Financial Assets and Financial LiabilitiesFinancial assets and financial liabilities are recognized when the Company becomes a party to the contractualprovisions of the relevant instrument Transaction cost that are directly attributable to the acquisition or issue offinancial assets and financial liabilities (other than financial assets and financial liabilities measured at fair valuethrough profit or loss) are added to or deducted from the fair value on initial recognition of financial assets andfinancial liabilities Purchase or sale of financial assets that require delivery of assets within a time frame establishedby regulation or convention in the market place (regular way trades) are recognized on the trade date ie the datewhen the Company commits to purchase or sell the asset
Financial AssetsRecognition Financial assets includes Investments Trade receivable Advances Security Deposits Cash andcash equivalents Such Assets are initially recognized at transaction price when the company becomes party tocontractual obligations The transaction price includes transaction cost unless the assets is being fair valuedthrough the Statement of Profit and Loss
Classification Management determines the classification of an asset at initial recognition depending on thepurpose for which the assets were acquired The subsequent measurement of financial assets depends on suchclassification
Financial assets are classified as those measured at
(a) Amortised cost where the financial assets are held solely for collection of cash flows arising from payments ofprincipal and or interest
(b) Fair value through other comprehensive income (FVTOCI) where the financial assets are held not only forcollection of cash flows arising from payments of principal and interest but also from the sale of such assetsSuch assets are subsequently measured at fair value with unrealised gains and losses arising from changesin the fair value being recognised in other comprehensive income
46
NOTES TO THE FINANCIAL STATEMENTS
(c) Fair value through profit or loss (FVTPL) where the assets are managed in accordance with an approvedinvestment strategy that triggers purchase and sale decision based on fair value of such assets Such assetsare subsequently measured at fair value with unrealized gain and losses arising from changes in the fair valuebeing recognised in the Statement of Profit and Loss in the period in which they arise
Trade receivable Advances Security Deposits Cash and Cash equivalents etc are classified for measurementat amortised cost while Investment have been classified for measurement at Fair value through profit or loss(FVTPL)
Impairment The Company assesses at each reporting date whether a financial asset (or group of financialassets) such as investment trade receivable advances and security deposit held at amortised cost are tested forimpairment based on evidence or information that is available without undue cost or effort Expected credit lossesare assessed and loss allowances recognized if the credit quality of the financial asset has deteriorated significantlysince initial recognition
Reclassification When and only when the business model is changed the Company shall reclassify all affectedfinancial assets prospectively from the reclassification date as subsequently measured at amortised cost fairvalue through profit or loss without restating the previously recognized gains or losses and in terms of thereclassification principles laid down in the Ind AS relating to Financial Instruments
De-recognition Financial assets are derecognized when the rights to receive benefits have expired or beentransferred and the Company has transferred substantially all risks and rewards of ownership of such financialasset
Financial LiabilitiesTrade payables and other financial liabilities are initially recognized at the value of the respective contractualobligations They are subsequently measured at amortised cost
Financial liabilities are derecognized when the liability is extinguished that is when the contractual obligation isdischarged cancelled or expires
Offsetting Financial InstrumentsFinancial assets and liabilities are offset and the net amount is included in the Balance Sheet where there is alegally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis orrealise the asset and settle the liability simultaneously
Revenue1 Revenue is measured at the fair value of the consideration received or receivable for services rendered net of
discounts to customers and excludes taxes such as Goods and Services Tax Revenue from the sale ofservices is recognised when the Company performs its obligations to its customers and the amount of revenuecan be measured reliably and recovery of the consideration is probable Income from operating license fees arerecognized on accrual basis in accordance with Operating License agreement The timing of such revenuerecognition is in the periods in which such services are rendered
2 Interest Income is booked in the Statement of Profit and Loss using the effective interest method
3 Dividend Income is recognised in the Statement of Profit and Loss when the right to receive dividend is established
Employee BenefitsThe Company makes contributions to both defined benefit and defined contribution schemes
Contributions to Provident Fund are in the nature of defined contribution scheme and such paidpayable amountsare charged against revenue The contributions in respect of provident fund and family pension are statutorilydeposited with the Government
The Company also makes contribution to defined benefit gratuity plan The cost of providing benefits under thedefined benefit obligation is calculated by independent actuary using the projected unit credit method The Companyhas taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liability with respect to the
47
NOTES TO THE FINANCIAL STATEMENTS
employees and the premium paid to LIC is charged to Statement of Profit amp Loss The difference between theactuarial valuation of the gratuity with respect to employees at the year-end and the contribution paid to LIC isfurther adjusted in the books of accounts
Employees Benefit wrt Leave Encashment is considered as Employees Long Term Benefit for which the Companyrecords the liability based on actuarial valuation computed under projected unit credit method These benefits areunfunded
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee as per the Operating LicenseAgreement
Taxes on IncomeTaxes on income comprises of current tax and deferred tax Current tax in the Statement of Profit and Loss isprovided as the amount of tax payable in respect of taxable income for the period using tax rates and tax lawsenacted during the period together with any adjustment to tax payable in respect of previous years
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities andthe amounts used for taxation purposes (tax base) at the tax rates and tax laws enacted or substantively enactedby the end of the reporting period
Deferred tax assets are recognized for the future tax consequences to the extent it is probable that future taxableprofits will be available against which the deductible temporary differences can be utilized
Deferred tax assets and liabilities are offset when there is legally enforceable right to offset current tax assets andliabilities and when the deferred tax balances relate to the same taxation authority Current tax assets and taxliabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on netbasis or to realize the asset and settle the liability simultaneously
Dividend DistributionDividends paid (including income tax thereon) is recognised in the financial statements in the period in which inwhich the interim dividends are approved by the Board of Directors or in respect of the Companyrsquos final dividendfor the year when the same are approved by shareholders of the Company
Provisions and Contingent LiabilitiesProvisions are recognized when the Company has a present obligation (legal or constructive) as a result of a pastevent it is probable that an outflow of resources will be required to settle the obligation and the amount can bereliably estimated The amount so recognized is the best estimate of the consideration required to settle theobligation at the reporting date taking in to account the risks and uncertainties surrounding the obligation Adisclosure for a contingent liability is made when there is possible obligation or a present obligation that may butprobably will not require an outflow of resources Where there is possible obligation or a present obligation inrespect of which the likelihood of outflow of resources is remote no provision or disclosure is made
Use of Estimates and JudgementsThe key estimates and assumption used in the preparation of financial statements are set out below
Actuarial ValuationThe determination of Companyrsquos liability towards defined benefit obligation to employees is made through independentactuarial valuation including determination of amounts to be recognized in the Statement of Profit and Loss and inother comprehensive income Such valuation depend upon assumptions determined after taking into accountinflation seniority promotion and other relevant factors such as supply and demand factors in the employmentmarket Information about such valuation is provided in notes to the financial statements
ComparativesWhen required by Ind AS comparative figures have been adjusted to conform to changes in presentation for thecurrent financial year
48
2P
rope
rty
Pla
nt a
nd E
quip
men
tA
mou
nt i
n `
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
Gros
s Bl
ock
Depr
eciat
on
Amor
tisati
onNe
t Blo
ck
Parti
cula
rsWi
thdraw
alWi
thdraw
alWi
thdraw
alWi
thdraw
alAp
ril 1
and
Marc
h 31
an
dMa
rch
31
April
1Fo
r the
and
March
31
For t
hean
dMa
rch
31
Marc
h 31
Ma
rch
31
2017
Addi
tions
Adjus
tmen
t20
18Ad
ditio
nsAd
justm
ent
2019
2017
year
Adjus
tmen
t20
18ye
arAd
justm
ent
2019
2019
2018
Tang
ible
Ass
ets
Build
ing
161
88
565
-16
188
565
-2
668
831
592
168
29
561
564
759
84-1
432
140
473
636
290
5518
76
721
140
44
961
147
56
425
Plan
t and
Equ
ipmen
t7
637
0120
716
742
985
-2
047
935
381
92-
--
--
--
538
192
742
985
Furn
iture
and
Fixt
ures
1
278
845
584
122
300
-11
818
110
482
--
--
--
-1
104
821
223
00
Offic
e Eq
uipme
nt2
017
-2
017
--
201
7-
--
--
--
201
72
017
Tota
l1
708
216
7-
263
001
705
586
7-
483
494
165
72
373
956
156
475
984
-14
321
404
736
3629
055
187
672
11
469
565
21
562
372
7
Full
y de
prec
iated
ass
ets
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
49
NOTES TO THE FINANCIAL STATEMENTS
Amount in `Particulars As at 31st March 2019 As at 31st March 2018
Current Non-Current Current Non-Current3 OTHER ASSETS
Advances other than capital advancesSecurity Deposit- With Others 2328947 2328947- Statutory Authorities 200000Other Advances (prepaid expenses) 437564 ndash 406324 ndashAdvance Tax (Net of Provisions) 4143487 5280504TOTAL 437564 6672434 406324 7609451
4 Current investments (at fair value through profit or loss unless otherwise stated) Amount in `Sl Investments in Mutual Funds As at 31st March 2019 As at 31st March 2018No
Name of Plan Unquoted Unquoted1 DHFL Pramerica Ultra Short Term Fund Nil (2018 - 1040731248)
Units of ` 1000 each ndash 219455882 ICICI Prudential Banking amp PSU Debt Fund 1124750948 Units
(2018 - 1124750948) of ` 1000 each 23872614 224702743 ICICI Prudential Corporate Bond Fund 1241451718 Units
(2018 - 1241451718) of ` 1000 each 23712100 221226704 UTI Floating Rate Fund Short Term Fund 7749911 Units
(2018-7749911) of ` 100000 each 23474167 218899535 SBI Magnum Instacash Nil Units (2018-3177849) of ` 100000 each ndash 70220186 Aditya Birla Sun Life Floating Rate Fund-Long Term 274475933 Units
(2018-319824542) Units of ` 10000 each 63614941 686675207 Aditya Birla Sunlife Saving Fund 137924934 Units (2018-129174683)
Units of ` 10000 each 51171946 443649348 Kotak Savings Fund 1128273230 Units (2018-Nil) of ` 1000 each 33816154 ndash9 Reliance Liquid Fund 11416769 Units (2018- Nil) of ` 100000 each 51823115 ndash10 ICICI Prudential Liquid Fund 57413509 Units (2018- Nil) of ` 10000 each 8809857 ndash
Aggregate amount of unquoted Investments 280294894 208482957TOTAL 280294894 208482957
Amount in `As at As at
31st March 2019 31st March 20185 TRADE RECEIVABLES
Unsecured Considered Good 16310661 14154244TOTAL 16310661 14154244
6 CASH AND CASH EQUIVALENTS Balances with Banks
Current Accounts 760024 900355Cash on Hand 3015 ndashTOTAL 763039 900355 Cash and cash equivalents include cash on hand cheques drafts on hand cash at bank and deposits with banks with original maturityof 3 months or less
7 OTHER BANKS BALANCESEarmarked balances 5489856 5429140On Deposit Accounts ndash 47753491TOTAL 5489856 53182631
Represents deposits with original maturity of more than 3 months having remaining maturity of less than 12 months from the Balance Sheet date
50
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
8 OTHER FINANCIAL ASSETSInterest accrued on Deposits 158000 2210348Others - Unsecured considered good 4566316 4138776TOTAL 4724316 6349124
As at As at As at As at31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of ` (No of `
Shares) Shares)9 EQUITY SHARE CAPITAL
AuthorisedEquity Shares of ` 10- each 10000000 100000000 10000000 100000000Issued Subscribed and Paid upEquity Shares of ` 10- each fully paid 3787515 37875150 3787515 37875150
A) Reconciliation of the number of Equity Shares outstanding31st March 31st March
2019 2018As at the beginning of the year 3787515 3787515Add - Shares issued during the year ndash ndashLess -Shares bought back during the year ndash ndashAs at the end of the year 3787515 3787515
B) Shareholders holding more than 5 of the As at As at As at As atEquity Shares in the Company 31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of (No of
Shares) Shares)ITC Limited 1733907 4578 1733907 4578Russell Investments Limited 300056 792 300056 792
C) Rights Preferences and Restrictions attached to the Equity SharesThe Equity Shares of the Company having par value of ` 10 per share rank pari passu in all respects includingvoting rights and entitlement to dividend
D) There are no bonus issue or buy back of equity shares during the period of five years immediately preceding thereporting date
As at 31st March 2019 As at 31st March 2018Current Non-Current Current Non-Current
10 PROVISIONSProvision for Long Term Employee Benefits 74301 1399224 43165 1270990TOTAL 74301 1399224 43165 1270990
51
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
11 DEFERRED TAX LIABILITIES (NET)Deferred Tax Liabilities 10745247 11364002Total 10745247 11364002Movement in Deferred Tax LiabilitiesAssets Balances
For the year 2018-19 Balance as on Recognized in Balance as on1st April 2018 profit or loss 31st March 2019
Deferred Tax Liabilities in relation toOther timing differences
On Depreciation on PPE 4293876 (252926) 4040950On Gain on Investment at FVTPL 7070126 473819 7543945
Total Deferred Tax Liabilities 11364002 220893 11584895Deferred tax liabilities beforeMAT credit entitlement 11364002 220893 11584895Less MAT credit entitlement ndash 839648 839648Total Deferred Tax Liabilities (Net) 11364002 (618755) 10745247
For the year 2017-18 Balance as on Recognized in Balance as on1st April 2017 profit or loss 31st March 2018
Deferred Tax liabilitiesassets in relation toOther timing differences
On Depreciation on PPE 4383618 (89742) 4293876On Gain on Investment at FVTPL 4629882 2440244 7070126
Total Deferred Tax Liabilities (Net) 9013500 2350502 11364002
As at As at31st March 2019 31st March 2018
12 OTHER FINANCIAL LIABILITIES
Unpaid Dividend 5489856 5429140Employee Related 3782488 5688986TOTAL 9272344 11118126
13 OTHER CURRENT LIABILITIES
Statutory Liabilities 1264039 1172866TOTAL 1264039 1172866
52
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 201814 REVENUE FROM OPERATIONS
Operating License Fees 36986948 33098499TOTAL 36986948 33098499
15 OTHER INCOMEInterest Income- Deposit with Banks- Carried At Amortised Cost 1178600 3272160- Deposit Others 139222 181790Dividend Income on Investment measured at FVTPL 159984 178075Net Gain(Loss) on financial assets mandatorily measured at FVTPL 18005340 13358789Net Gain(Loss) on Disposal of Fixed Assets ndash 28273Other Non-Operating Income 142398 100022TOTAL 19625544 17119109
Includes 1120976- (2018 - 681882-) being net gain(loss) on sale of investments
16 EMPLOYEE BENEFITS EXPENSESalaries and Wages 42461991 38590070Contribution to Provident and Other Fund 4564892 3983444
47026883 42573514Less Recoveries madeReimbursements received (45818303) (41478905)TOTAL 1208580 1094609
17 OTHER EXPENSESAdvertising Sales Promotion 159768 158814Consultancy Professional fees 214842 253969Travelling amp Conveyance 810746 1096527Postage Telephone Stationery etc 366042 205049Miscellaneous Expenses 1556515 1619728TOTAL 3107913 3334087Miscellaneous expenses includes Auditors remuneration andexpenses Audit Fees 60000 60000Fees for other services 40000 ndash
18 INCOME TAX EXPENSESA Amount recognised in profit or loss
Current TaxIncome Tax for the Year 11504441 9481109Adjustments(Credits) related to previous year 149058 (208799)Total Current Tax 11653499 9272310Deferred TaxDeferred tax for the year 220893 2350502Mat Credit Entitlement (839648) ndashTotal Deferred Tax (618755) 2350502TOTAL 11034744 11622812
NOTES TO THE FINANCIAL STATEMENTSAmount in `
53
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 2018B Reconciliation of effective tax rate
Profit before tax 51822363 45312928Indian tax rate 2782 2755Income Tax expense calculated at 2782 (2018 2755) 14416981 12484845Effects ofndash Different tax rate on certain items (2922098) (756048)ndash Difference in taxable incomedeductible expense 9697 42609ndash Incomes that are not taxable in determining taxable profit (44508) (49064)Adjustments recognised in the current year in relation toCurrent tax of prior years (425328) (208799)Effect on deferred tax balances due to the change in income tax rate ndash 109269Income Tax recognised in profit or loss 11034744 11622812
The tax rate used for the year 2018-19 and 2017-18 reconciliations above is the corporate tax rate of 25 + surcharge 7 and education cess 4 (2017-18 3) payable on taxable profits under the Income Tax Act 1961
19 EARNINGS PER EQUITY SHAREProfit for the year 40787619 33690116Number of equity shares outstanding 3787515 3787515Basic and diluted earnings per share in (Face value ` 10- per share) 1077 890
20 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTSA The Company was allotted 8200 sq mtrs of land at Vadodara in 1984 and an additional land of 2548 sq mtrs
in 1988 at R C Dutt Road Alkapuri Vadodara through GIIC (Gujarat Industrial Investment Corporation) on sub-lease for a period 30 years on which the hotel Welcomhotel Vadodara was constructed Lease term of landadmeasuring 8200 Sq mtrs expired on 30092014 and of land admeasuring 2548 sq mtrs expired on 30112018
The High Court of Gujarat in pursuance of Writ petition filed by Company in April 2013 passed an Order onDecember 24 2014 restraining the State Government from disturbing the peaceful and actual possession ofthe Company over the hotel property in any manner The writ petition is pending for hearing
The Company have made necessary application to State Government for Conversion of land from Leasehold toFreehold or Extension of Lease which is in process
B There are no Micro Small and Medium Enterprises to whom the Company owes dues which are outstandingfor more than 45 days during the year and also as at 31st March 2019 This information as required to bedisclosed under the Micro Small and Medium Enterprises Development Act 2006 has been determined tothe extent such parties have been identified on the basis of information available with the Company
C The Company operates in one segment ie Hoteliering and within one geographical segment ie India
D Defined Benefit Plan
The Company has taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liabilitywith respect to the employees and the premium paid to LIC is charged to Statement of Profit amp Loss Thedifference between the actuarial valuation of the gratuity with respect to employees at the year-end and thecontribution paid to LIC is further adjusted in the books of accounts
The accounting charge for benefits under the defined benefit obligation is calculated by independent actuaryusing the projected unit credit method
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee (ITC Limited) as per theOperating License Agreement hence no effect on Statement of Profit amp Loss and Other Comprehensive
54
NOTES TO THE FINANCIAL STATEMENTS
Income
Risk ManagementThe defined Benefit Plan expose the company to risk of actuarial deficit arising out of investment risk interestrate risk and salary cost inflation riskInvestment Risks This may arise from volatility in asset values due to market fluctuations and impairment ofassets due to credit losses These Plans primarily invest in debt instruments such as Government securitiesand highly rated corporate bonds ndash the valuation of which is inversely proportional to the interest rate movementsInterest Rate Risk The present value of Defined Benefit Plans liability is determined using the discount ratebased on the market yields prevailing at the end of reporting period on Government bonds A decrease inyields will increase the fund liabilities and vice-versaSalary Cost Inflation Risk The present value of the Defined Benefit Plan liability is calculated with referenceto the future salaries of participants under the Plan Increase in salary due to adverse inflationary pressuresmight lead to higher liabilitiesThese Plans have a relatively balanced mix of investments in order to manage the above risks The investmentstrategy is designed based on the interest rate scenario liquidity needs of the Plans and pattern of investmentas prescribed under various statutes
(Amount in `) Particulars Gratuity 2018-19 2017-18
I Components of Defined Benefit Cost 31-03-2019 31-03-2018 Recognised in Profit or Loss a Current Service Cost 641829 519816 b Past Service Cost ndash
c Net Interest Cost (184109) (72060) Remeasurements a Effect of changes in demographic assumptions (2108) ndash b Effect of changes in financial assumptions ndash (546692) c Effect of experience adjustments (142950) (700483) d (Return) on plan assets (excluding interest income) 24103 110903 e Changes in asset ceiling (excluding interest income) ndash ndash f Total remeasurements included in OCI (169160) (1358078)
Total defined benefit cost recognized in PampL 288560 (910323)I I Net Assets (Liabilities) recognised in Balance Sheet 31-03-2019 31-03-2018
1 Defined Benefit Obligation at end of period 11112243 102978642 Fair value of plan assets at end of period 13058222 120087733 Net defined benefit liability (asset) (1945979) (1710909)
III Change in Defined Benefit Obligation 31-03-2019 31-03-20181 Defined benefit obligation at beginning of period 10297864 111006822 Current service cost 641829 5198163 Interest expenses 755904 7223694 Remeasurements gains (losses)
a Effect of changes in demographic assumptions (2108) ndashb Effect of changes in financial assumptions ndash (546692)c Effect of experience adjustments (142950) (700483)
5 Benefits Paid (438296) (797828)6 Present Value of DBO at end of the year 11112243 10297864
IV Change in Fair Value of Plan Assets 31-03-2019 31-03-20181 Fair value of plan assets at beginning of period 12008773 11529880
55
NOTES TO THE FINANCIAL STATEMENTS
2 Interest income 940012 7944303 Actual Company Contributions 523630 3713884 Benefits Paid (438296) (797828)5 Remeasurements Gains(Losses) on plan assets 24103 1109036 Fair Value of Plan Assets at end of period 13058222 12008773
V Significant Actuarial Assumptions 31-03-2019 31-03-20181 Discount rate () 750 7502 Salary increase rate 70 703 Attrition Rate 20 204 Retirement Age 58 585 Pre-retirement Mortality Indian Assured Indian Assured
Lives Mortality Lives Mortality(2012-14) Ultimate (2006-08) Ultimate
6 Disability Nil NilVI Sensitivity Analysis
The below sensitivity analysis are based on a change in an assumption while holding all other assumptionsconstant In practice this is unlikely to occur and changes in some of the assumptions may be correlatedWhen calculating the sensitivity of the defined benefit obligation to significant actuarial assumptionsthe same method (present value of the defined benefit obligation calculated with the projected unit creditmethod at the end of the reporting period) has been applied as when calculating the defined benefitliability recognised in the balance sheet The methods and types of assumptions used in preparing thesensitivity analysis did not change compared to the prior period
DBO as at DBO as at31-03-2019 31-03-2018
1 Discount rate +100 basis points 10484869 96707062 Discount rate -100 basis points 11804923 109908143 Salary Increase Rate +1 11746789 109364544 Salary Increase Rate -1 10525722 97077345 Attrition Rate +1 11127835 103179616 Attrition Rate -1 11095064 10276102
Maturity Analysis of the Benefit Payments 31-03-2019 31-03-2018 Year 1 804294 399061 Year 2 1117591 769443 Year 3 558914 1211853 Year 4 2204073 512504 Year 5 1303903 2056016 Next 5 years 4323660 4603103
E Amount towards Defined Contribution Plans have been recognized under Contribution to Provident and OtherFunds in Note 16 ` 4564892- (2018 - ` 3983444-)
F The financial statements were approved for issue by the Board of Directors on 15th April 2019G Company has adopted IND As 115 lsquoRevenue from Contracts with Customersrsquo wef 01st April 2018 on prospective
basis and there is no material impact on Financial StatementsH Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Second
Amendment Rules 2019 on 30th March 2019 notifying new Standard Ind AS 116 lsquoLeasesrsquo and otherconsequential amendment in existing Ind As This Ind AS is applicable for annual period beginning on or after01st April 2019 The company is in the process of analysing the impact of such amendment which are notexpected to be material
56
NOTES TO THE FINANCIAL STATEMENTS
21 Financial Instruments and Related DisclosuresI Capital Management
The Company does not have borrowing and aims at maintaining a strong capital base so as to maintain adequatesupply of funds towards future growth plans as a going concern
II Categories of Financial InstrumentsAmount in `
Particulars Note As at As at March 31 2019 March 31 2018
Carrying Fair Carrying FairValue Value Value Value
A Financial Assetsa) Measured at Amortised Cost
i) Cash and cash equivalents 6 763039 763039 900355 900355ii) Other bank balances 7 5489856 5489856 53182631 53182631iii) Trade Receivables 5 16310661 16310661 14154244 14154244iv) Other Financial Assets 8 4724316 4724316 6349124 6349124
Sub - total 27287872 27287872 74586354 74586354 b) Measured at Fair Value through Profit or Loss
i) Investment in mutual funds 4 280294894 280294894 208482957 208482957Sub - total 280294894 280294894 208482957 208482957
Total Financial Assets 307582766 307582766 283069311 283069311B Financial Liabilities
Measured at Amortised Costi) Trade Payables 483074 483074 395920 395920ii) Other Financial Liabilities 12 9272344 9272344 11118126 11118126Total Financial Liabilities 9755418 9755418 11514046 11514046
The carrying amounts of trade payables other financial liabilities cash and cash equivalents other bank balancestrade receivables and other financial assets are considered to be the same as their fair values due to their short termnatureFair value in Mutual fund has been considered as Level 1 as Hierarchy for the same are based on unadjusted pricesin active marketIII Financial Risk Management Objectives
The Company has a system-based approach to risk management anchored to policies and procedures andinternal financial controls aimed at ensuring early identification evaluation and management of key financialrisks (such as market risk credit risk and liquidity risk) that may arise as a consequence of its businessoperations as well as its investing activities Accordingly the Companyrsquos risk management framework has theobjective of ensuring that such risks are managed within acceptable and approved risk parameters in a disciplinedand consistent manner and in compliance with applicable regulation It also seeks to drive accountability in thisregardLiquidity RiskThe company has current assets aggregate to ` 308020330- (2018- ` 283475635) including CurrentInvestments Cash and cash equivalents and Other bank balances of ` 286547789- (2018- ` 262565943-)against an aggregate Current liability of ` 11093758- (2018- ` 12730077-) on the reporting dateFurther whilethe Companyrsquos total equity stands at ` 306150187- (2018- ` 281343744-) and it has no borrowings In suchcircumstances liquidity risk or the risk that the company may not be able to settle or meet its obligations as theybecome due does not existMarket RiskThe company invests in mutual fund schemes of leading fund houses Such investments are susceptible tomarket price risk that arise mainly from changes in interest rate which may impact the return and value of such
57
NOTES TO THE FINANCIAL STATEMENTS
investments However given the relatively short tenure of the underlying portfolio of the mutual fund schemes inwhich the company has invested such price risk is not significantCredit RiskCompanyrsquos deployment in financial instruments such as mutual funds and fixed deposit are made in high qualitypaperscounterparties The company has receivable balances with ITC Limited under the Operating ServiceAgreement which are generally short term in nature Accordingly the Company has concluded that no provisionfor expected credit loss is required
22 Related Party DisclosuresRelated Party Transactionsi) Name of related parties and nature of relationships
ITC Limited of which the Company is an Associateii) Key Management Personnel
Board of DirectorsN Anand Chairman amp Non-Executive DirectorJ Singh Non-Executive DirectorR C Mehta Non-Executive DirectorC K Koshy Non-Executive DirectorM Narayanan Non-Executive DirectorD R Choudhury Non-Executive Director
iii) Summary of transactions during the year Amount in `
Particulars ITC Limited Key ManagementPersonnel
2019 2018 2019 2018License Fees Received 43644599 38834172 ndash ndashPurchase of Services 364514 513635 ndash ndashRemuneration of Managers on Deputation Reimbursed 5916468 5236397 ndash ndashRecoveries of Contractual Remuneration(Including Mangers on Deputation) 53058539 51502148 ndash ndashExpenses Recovered 2168155 2400471 ndash ndashExpenses Reimbursed ndash 44604 ndash ndashDividend Payments 6068675 6068675 700 700Remuneration to Key Management Personnel- Directorrsquos Sitting Fees 370000 350000Balance amount recoverable 20865894 18292750 ndash ndashBalance amount payable ndash ndash ndash ndash
58
TO THE MEMBERS OFGUJARAT HOTELS LIMITED
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying financial statementsof Gujarat Hotels Limited (ldquothe Companyrdquo) which comprisethe Balance Sheet as at 31st March 2019 the Statement ofProfit and Loss including other comprehensive incomeStatement of Changes in Equity and Statement of CashFlows for the year then ended and notes to the financialstatements including a summary of significant accountingpolicies and other explanatory information (hereinafterreferred to as ldquothe financial statementsrdquo)
In our opinion and to the best of our information andaccording to the explanations given to us the aforesaidfinancial statements give the information required by theCompanies Act 2013 (ldquothe Actrdquo) in the manner so requiredand give a true and fair view in conformity with the IndianAccounting Standards specified under section 133 of theAct read with the Companies (Indian Accounting Standards)Rules 2015 as amended (lsquoInd ASrdquo) and other accountingprinciples generally accepted in India of the state of affairsof the Company as at 31 st March 2019 and totalcomprehensive income (comprising of profit and othercomprehensive income) changes in equity and its cashflows for the year ended on that date
Basis for Opinion
We conducted our audit of the financial statements inaccordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act Our responsibilities underthose Standards are further described in the AuditorrsquosResponsibilities for the Audit of the Financial Statementssection of our report We are independent of the Companyin accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financialstatements under the provisions of the Act and the Rulesmade thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements andthe Code of Ethics We believe that the audit evidence wehave obtained is sufficient and appropriate to provide abasis for our audit opinion
Key Audit Matters
Key audit matters are those matters that in our professionaljudgment were of most significance in our audit of thesefinancial statements of the current period These matterswere addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereonand we do not provide a separate opinion on these mattersWe have determined the matters described below to bethe key audit matters to be communicated in our report
INDEPENDENT AUDITORS REPORT
Information Other than the Financial Statements andAuditorrsquos Report Thereon
The Companyrsquos Board of Directors is responsible forpreparation of the other information The other informationcomprises the information included in the Boardrsquos Reportincluding Annexures to Boardrsquos Report ManagementDiscussion and Analysis Report on Corporate Governance
and Shareholderrsquos Information but does not include thefinancial statements and our auditorrsquos report thereon
Our opinion on the financial statements does not cover theother information and we do not express any form ofassurance conclusion thereon
In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing
Sr No
Key Audit Matter How our audit addressed the matter
1 Evaluation of uncertain legal position of leasehold land
(Refer note no 20A to the financial statements)
The lease period of land held by the Company has expired The Company has filed necessary writ petition with High Court of Gujarat in April 2013 which is still pending for adjudication The Company has also made necessary application to State Government for Conversion of land from Leasehold to Freehold or Extension of Lease which is in process This matter being sub-judice essentially involves significant judgement to determine the possible outcome and therefore we have considered it as a key audit matter
We performed the following substantive procedures
Obtained details of application made to State Government Obtained details of writ petition filed to the High Court of
Gujarat and order copy passed by the High Court of Gujarat restraining the State Government from disturbing the actual possession over the property
Obtained details of progress in the matter Discussed the case with the Companyrsquos legal advisor about
the possible outcomes Read the minutes of the board meetings
Based on the procedures described managementrsquos evaluation on the same is acceptable
59
so consider whether the other information is materiallyinconsistent with the financial statements or our knowledgeobtained in the audit or otherwise appears to be materiallymisstated
If based on the work we have performed we conclude thatthere is a material misstatement of this other informationwe are required to report that fact We have nothing to reportin this regard
Responsibilities of Management and Those Charged withGovernance for the Financial Statements
The Companyrsquos Board of Directors is responsible for thematters stated in section 134(5) of the Act with respect tothe preparation of these financial statements that give atrue and fair view of the financial position financialperformance including other comprehensive incomechanges in equity and cash flows of the Company inaccordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards(Ind AS) prescribed under section 133 of the Act
This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company andfor preventing and detecting frauds and other irregularitiesselection and application of appropriate accounting policies making judgments and estimates that are reasonableand prudent and design implementation andmaintenance of adequate internal financial controls thatwere operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to thepreparation and presentation of the financial statementsthat give a true and fair view and are free from materialmisstatement whether due to fraud or error
In preparing the financial statements management isresponsible for assessing the Companyrsquos ability tocontinue as a going concern disclosing as applicablematters related to going concern and using the goingconcern basis of accounting unless management eitherintends to liquidate the Company or to cease operationsor has no realistic alternative but to do so
The Board of Directors is also responsible for overseeingthe Companyrsquos financial reporting process
Auditorrsquos Responsibilities for the Audit of the FinancialStatements
Our objectives are to obtain reasonable assurance aboutwhether the financial statements as a whole are free frommaterial misstatement whether due to fraud or error andto issue an auditorrsquos report that includes our opinionReasonable assurance is a high level of assurance but isnot a guarantee that an audit conducted in accordance withSAs will always detect a material misstatement when itexists Misstatements can arise from fraud or error and areconsidered material if individually or in the aggregate they
could reasonably be expected to influence the economicdecisions of users taken on the basis of these financialstatements
As part of an audit in accordance with SAs we exerciseprofessional judgment and maintain professionalskepticism throughout the audit We also
bull Identify and assess the risks of materialmisstatement of the financial statements whetherdue to fraud or error design and perform auditprocedures responsive to those risks and obtain auditevidence that is sufficient and appropriate to providea basis for our opinion The risk of not detecting amaterial misstatement resulting from fraud is higherthan for one resulting from error as fraud may involvecollusion forgery intentional omissionsmisrepresentations or the override of internal control
bull Obtain an understanding of internal control relevantto the audit in order to design audit procedures thatare appropriate in the circumstances Under section143(3)(i) of the Act we are also responsible forexpressing our opinion on whether the Company hasadequate internal financial controls system in placeand the operating effectiveness of such controls
bull Evaluate the appropriateness of accounting policiesused and the reasonableness of accountingestimates and related disclosures made bymanagement
bull Conclude on the appropriateness of managementrsquosuse of the going concern basis of accounting andbased on the audit evidence obtained whether amaterial uncertainty exists related to events orconditions that may cast significant doubt on theCompanyrsquos ability to continue as a going concern Ifwe conclude that a material uncertainty exists we arerequired to draw attention in our auditorrsquos report tothe related disclosures in the financial statementsor if such disclosures are inadequate to modify ouropinion Our conclusions are based on the auditevidence obtained up to the date of our auditorrsquosreport However future events or conditions maycause the Company to cease to continue as a goingconcern
bull Evaluate the overall presentation structure andcontent of the financial statements including thedisclosures and whether the financial statementsrepresent the underlying transactions and events ina manner that achieves fair presentation
We communicate with those charged with governanceregarding among other matters the planned scope andtiming of the audit and significant audit findings includingany significant deficiencies in internal control that weidentify during our audit
INDEPENDENT AUDITORS REPORT
60
We also provide those charged with governance with astatement that we have complied with relevant ethicalrequirements regarding independence and tocommunicate with them all relationships and other mattersthat may reasonably be thought to bear on ourindependence and where applicable related safeguards
From the matters communicated with those charged withgovernance we determine those matters that were of mostsignificance in the audit of the financial statements of thecurrent year and are therefore the key audit matters Wedescribe these matters in our auditorrsquos report unless lawor regulation precludes public disclosure about the mattersor when in extremely rare circumstances we determinethat a matters should not be communicated in our reportbecause the adverse consequences of doing so wouldreasonably be expected to outweigh the public interestbenefits of such communication
Report on Other Legal and Regulatory Requirements
1 As required by the Companies (Auditorrsquos Report)Order 2016 (ldquothe Orderrdquo) issued by the CentralGovernment of India in terms of sub-section (11) ofsection 143 of the Act we give in ldquoAnnexure Ardquo astatement on the matters specified in paragraphs 3and 4 of the Order to the extent applicable
2 As required by Section 143(3) of the Act we reportthat
a we have sought and obtained all the information andexplanations which to the best of our knowledge andbelief were necessary for the purposes of our audit
b in our opinion proper books of account as requiredby law have been kept by the Company so far as itappears from our examination of those books
c the Balance Sheet the Statement of Profit and lossincluding other comprehensive income the Statementof Changes in Equity and the Statement of Cash Flowsdealt with by this Report are in agreement with thebooks of account
d in our opinion the aforesaid financial statementscomply with the Indian Accounting Standards (Ind AS)prescribed under Section 133 of the Act
e on the basis of the written representations receivedfrom the directors as on 31st March 2019 taken onrecord by the Board of Directors none of the directorsis disqualified as on 31st March 2019 from beingappointed as a director in terms of Section 164(2) ofthe Act
f with respect to the adequacy of the internal financialcontrols with reference to financial statements of theCompany and the operating effectiveness of suchcontrols refer to our separate report in ldquoAnnexure Brdquoand
g with respect to the other matters to be included in theAuditorrsquos Report in accordance with the requirementsof section 197(16) of the Act as amended theCompany has neither paid nor provided for anyremuneration to its directors during the year
h with respect to the other matters to be included in theAuditorrsquos Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules 2014 in ouropinion and to the best of our information andaccording to the explanations given to us
i the Company does not have any pendinglitigations which would impact its financialposition
ii the Company did not have any long-termcontracts including derivative contracts for whichthere were any material foreseeable losses
iii there has been no delay in transferringamounts required to be transferred to theInvestor Education and Protection Fund by theCompany
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
61
ANNEXURE A TO THE INDEPENDENT AUDITORrsquoS REPORT
The annexure referred to in our Independent AuditorrsquosReport to the members of Gujarat Hotels Limited (ldquotheCompanyrdquo) on the financial statements for the year ended31st March 2019 we report that
i (a) The Company has maintained proper recordsshowing full particulars including quantitativedetails and situation of fixed assets
(b) As explained to us the Company has a regularprogram of physical verification of fixed assetswhich in our opinion is reasonable The assetswhich were to be covered as per the saidprogram have been physically verified by themanagement during the year In our opinion andAccording to the information and explanationsgiven to us no material discrepancies werenoticed on such verification
(c) According to the information and explanationsgiven to us and on the basis of our examinationof the records of the Company the title deeds ofimmovable properties are held in the name ofthe Company with respect to land the Companyhas filed a writ petition with Gujarat High Courtseeking that the Gujarat State Government bedirected to take action on Companyrsquosapplication to have the leasehold land of theHotel Converted to freehold and transferred toCompany as per the existing government policyin this regard
ii The Company does not have any inventory andtherefore reporting under clause (ii) of the Order isnot applicable to the Company
iii The Company has not granted any loans secured orunsecured to Companies firms Limited LiabilityPartnerships or other parties covered in the registermaintained under section 189 of the Companies Act2013 and therefore reporting under clause (iii) of theOrder is not applicable to the Company
iv The Company has not given any loans guaranteesor security In respect of the Investments made in ouropinion and according to the information andexplanations given to us the Company has compliedwith the provisions of section 186 of the Act
v According to the information and explanations givento us the Company has not accepted any depositsduring the year from the public within the meaning ofprovisions of section 73 to 76 of the Companies Act2013 and the rules framed thereunder and thereforereporting under clause (v) of the Order is notapplicable to the Company
vi In our opinion and according to the information andexplanations given to us in view of Rule 3 of theCompanies (Cost Records and Audit) AmendmentsRules 2014 the maintenance of cost records undersub-section (1) of section 148 of the Companies Act2013 is not applicable to the Company and thereforereporting under clause (vi) of the Order is notapplicable to the Company
vii (a) According to the information and explanationsgiven to us the Company has been regular indepositing with appropriate authoritiesundisputed statutory dues including providentfund employeersquos state insurance income-taxvalue added tax goods and service tax cessand other statutory dues applicable to it Furtherno undisputed amounts payable in respect ofprovident fund employeersquos state insuranceincome tax value added tax goods and servicetax cess and any other statutory dues were inarrears as at 31st March 2019 for a period ofmore than six months from the date theybecome payable
(b) According to the information and explanationsgiven to us there are no dues of Income taxsales tax value added tax and goods andservice tax which have not been deposited onaccount of any dispute
viii The Company has not taken any loans or borrowingsfrom financial institutions banks and government orhas not issued any debentures and thereforereporting under clause (viii) of the Order is notapplicable to the Company
ix The Company has not raised moneys by way of initialpublic offer or further public offer (including debtinstrument) and term loans during the year andtherefore reporting under clause (ix) of the Order isnot applicable to the Company
x To the best of our knowledge and according toinformation and explanations given to us no materialfraud by the Company or on the Company by its officersor employees has been noticed or reported duringthe course of our audit
xi In our opinion and according to the information andexplanations given to us the Company has not paidor provided any managerial remuneration during theyear and therefore reporting under clause (xi) of theOrder is not applicable to the Company
xii The Company is not a Nidhi company and thereforereporting under clause (xii) of the Order is notapplicable to the Company
INDEPENDENT AUDITORS REPORT
62
xiii In our opinion and according to the information andexplanations given to us and based on ourexamination of the records of the Company alltransactions with the related parties are in compliancewith Section 177 and 188 of the Act where applicableand the details have been disclosed in the financialstatements as required by the applicable accountingstandards
xiv According to the information and explanations givento us the Company has not made any preferentialallotment or private placement of shares or fully orpartly convertible debentures during the year underreview and therefore reporting under clause (xiv) ofthe Order is not applicable to the Company
xv In our opinion and according to the information andexplanations given to us the Company has not
entered into any non-cash transactions with directorsor persons connected with directors and thereforereporting under clause (xv) of the Order is notapplicable to the Company
xvi The Company is not required to be registered undersection 45-IA of the Reserve Bank of India Act 1934
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
63
ANNEXURE ldquoBrdquo TO THE INDEPENDENT AUDITORSrsquo REPORT
(Referred to in paragraph 2(f) under lsquoReport on Other Legaland Regulatory Requirementsrsquo section of our report to theMembers of Gujarat Hotels Limited on the financialstatements of even date)
Report on the Internal Financial Controls with referenceto financial statements under Clause (i) of Sub-section 3of Section 143 of the Act
W e have audited the internal financial controls withreference to financial statements of Gujarat Hotels Limited(ldquothe Companyrdquo) as of 31st March 2019 in conjunction withour audit of the financial statements of the Company for theyear ended on that date
Managementrsquos Responsibility for Internal FinancialControls
The Companyrsquos management is responsible forestablishing and maintaining internal financial controlsbased on the internal control over financial reporting criteriaestablished by the Company considering the essentialcomponents of internal control stated in the Guidance Noteon Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountantsof India (ldquoICAIrdquo) These responsibilities include the designimplementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuringthe orderly and efficient conduct of its business includingadherence to companyrsquos policies the safeguarding of itsassets the prevention and detection of frauds and errorsthe accuracy and completeness of the accounting recordsand the timely preparation of reliable financial informationas required under the Act
Auditorsrsquo Responsibility
Our responsibility is to express an opinion on theCompanyrsquos internal financial controls with reference tofinancial statements based on our audit We conductedour audit in accordance with the Guidance Note on Audit ofInternal Financial Controls over Financial Reporting (theldquoGuidance noterdquo) and the Standards on Auditing issued byICAI and deemed to be prescribed under section 143(10)of the Companies Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the ICAIThose Standards and the Guidance Note require that wecomply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whetheradequate internal financial controls with reference tofinancial statements were established and maintained andif such controls operated effectively in all material respects
Our audit involves performing procedures to obtain auditevidence about the adequacy of the internal financialcontrols with reference to financial statements and their
operating effectiveness Our audit of internal financialcontrols with reference to financial statements includedobtaining an understanding of internal financial controlswith reference to financial statements assessing the riskthat a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal controlbased on the assessed risk The procedures selecteddepend on the auditorrsquos judgement including theassessment of the risks of material misstatement of thefinancial statements whether due to fraud or error
We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our auditopinion on the Companyrsquos internal financial controls withreference to financial statements
Meaning of Internal Financial Controls with reference tofinancial statements
A Companyrsquos internal financial controls with reference tofinancial statements is a process designed to providereasonable assurance regarding the reliability of financialreporting and the preparation of financial statements forexternal purposes in accordance with generally acceptedaccounting principles A Companyrsquos internal financialcontrols with reference to financial statements includesthose policies and procedures that (1) pertain to themaintenance of records that in reasonable detailaccurately and fairly reflect the transactions anddispositions of the assets of the Company (2) providereasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements inaccordance with generally accepted accounting principlesand that receipts and expenditures of the Company arebeing made only in accordance with authorisations ofmanagement and directors of the Company and (3) providereasonable assurance regarding prevention or timelydetection of unauthorised acquisition use or dispositionof the Companyrsquos assets that could have a material effecton the financial statements
Inherent Limitations of Internal Financial Controls withreference to financial statements
Because of the inherent limitations of internal financialcontrols with reference to financial statements includingthe possibility of collusion or improper managementoverride of controls material misstatements due to erroror fraud may occur and not be detected Also projections ofany evaluation of the internal financial controls withreference to financial statements to future periods aresubject to the risk that the internal financial control withreference to financial statements may become inadequatebecause of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate
INDEPENDENT AUDITORS REPORT
64
Opinion
In our opinion the Company has in all material respectsan adequate internal financial controls with reference tofinancial statements and such internal financial controlswith reference to financial statements were operatingeffectively as at 31st March 2019 based on the internalcontrol over financial reporting criteria established by theCompany considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal
INDEPENDENT AUDITORS REPORT
Financial Controls over Financial Reporting issued by theInstitute of Chartered Accountants of India
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
8
ROUTE MAP
AGM VenueWelcomHotel VadodaraR C Dutt Road AlkapuriVadodara 390 007
9
N Anand
Nakul Anand (62) DIN 00022279 a Non-Executive Directorof the Company since 10th March 1998 was appointed asthe Chairman of the Company effective 21st March 2009He is an Executive Director on the Board of ITC Limited andholds responsibility for the Hospitality Travel amp Tourismand Lifestyle Retailing businesses of ITC
An Economics Honours Graduate from the Delhi Universitywith an AMP degree from the Bond University AustraliaAnand joined ITC Hotelsrsquo Management TrainingProgramme in 1978 He has also served as the ManagingDirector of erstwhile ITC Hotels Limited during the period2003-05
In a career that spans close to four decades Anand hasbeen acknowledged in the hotels and tourism industry forhis vision and commitment Leveraging the significantlearning of sustainable excellence within ITC he led theteam at ITC Hotels to pioneer the concept of lsquoResponsibleLuxuryrsquo in the hospitality industry securing LEEDreg Platinumcertifications for all ITC premium luxury hotels He hasformulated value-based strategies to create a uniquequality control model His dynamic leadership and passionfor the business is recognised and acknowledged by hispeers He has been a past President of the HotelAssociation of India and past Chairman of the CII NationalTourism Committee Anand is presently a member of theNational Tourism Advisory Council constituted by theMinistry of Tourism Government of India Chairman of theFederation of Associations in Indian Tourism amp Hospitalityand a Member of the Executive Committee of the HotelAssociation of India He is also a Member of the IndiandashSriLanka CEOs Forum Council Member amp ExecutiveCommittee Member of the National Culture Fund Ministryof Culture Government of India and a Member on the Boardof the International Tourism Partnership
Other Directorships
Name of the company Position
International Travel House Limited Chairman amp Non-Executive Director
Landbase India Limited Chairman amp Non-Executive Director
Fortune Park Hotels Limited Chairman amp Non-Executive Director
WelcomHotels Lanka (Private) Limited Chairman amp Non-Executive Director
Srinivasa Resorts Limited Vice Chairman amp Non-Executive Director
ITC Limited Executive Director
Bay Islands Hotels Limited Non-Executive Director
Maharaja Heritage Resorts Limited Non-Executive Director
Committee Membership of other companies
Name of the Committee Positioncompany
International Travel House Limited Nominations amp MemberRemuneration Committee
Landbase India Limited Audit Committee Member
Fortune Park Hotels Limited Corporate Social ChairmanResponsibility Committee
CK Koshy
Cheruvettolil Kochukoshy Koshy (74) DIN01478704 wasappointed as an Independent Non-Executive Director ofthe Company on 1st May 2007 He is Master of Arts inPolitical Science and Public Administration He joined theIndian Administrative Service in 1968 from the Gujarat Cadreand superannuated in February 2005
In a long career spanning over 38 years he has held severaleminent positions including those of Additional ChiefSecretary - Department of Revenue Industries and MinesTourism and Civil Aviation and Finance and PrincipalSecretary to the Chief Minister He served the Governmentof India as Joint Secretary amp Financial Advisor to theDepartment of Atomic Energy and as Executive Director ofNuclear Power Corporation of India Limited He has heldthe posts of Managing Director of the Tourism Corporationof Gujarat Sardar Sarovar Narmada Nigam Gujarat StateSmall Industries Corporation and Girinar Scooter LimitedHe was also the Joint Managing Director of the GujaratIndustrial Investment Corporation and Chairman of GujaratState Petroleum Corporation Limited Gujarat State PetronetLimited and Gujarat Energy Research and ManagementInstitute
Post retirement he has been a consultant to the Departmentfor International Development - UK the World Bank and tothe Department of Personnel and Administrative ReformsGovt of India He was appointed Professor Emeritus in thefaculty of Planning and Public Policy at CEPT UniversityAhmedabad and is an Advisor to both Indian School ofPetroleum and Energy New Delhi and University ofPetroleum and Energy Studies Dehradun Currently he isAdvisor at CEPT University and on the Board of Trustees ofAlliance Francaise Gujarat and GIAN an NGO whichencourages innovation at the grass root level
Koshy does not hold directorship of any other company
M Narayanan
Mahalinga Narayanan (74) DIN 00159288 was appointedas an Independent Non-Executive Director of the Companyon 10th January 2008 He is a post graduate in CommerceGraduate in Law Diploma Holder in Business Managementand holds certified Associated Membership of the Indian
YOUR DIRECTORS
10
Institute of Bankers He has rich experience of over fourdecades in Banking Project Finance Administration andrelated areas
Narayanan started his career with the Reserve Bank ofIndia in 1964 and moved over to the Bank of Baroda in1969 and continued till March 1985 During his tenure inBank of Baroda he worked in all departments of commercialbanking operation and was in-charge of large branches ofthe Bank In April 1985 he joined Industrial FinanceCorporation of India and held senior managementpositions In October 1997 he joined Tourism FinanceCorporation of India Limited as Managing Director and roseto the position of Chairman and Managing Director whichposition he held till his retirement in September 2006 Hewas conferred with ldquoUdyog Rattan Awardrdquo in the year 2005by the Institute of Economic Studies New Delhi
Other Directorships
Name of the company Position
Cox amp Kings Limited Independent DirectorTulip Star Hotels Limited Independent DirectorRoyale Indian Rail Tours Limited Independent DirectorPride Hotels Limited Chairman amp Independent Director
Committee Membership of other Companies
Name of the company Committee Position
Cox amp Kings Limited Audit Committee ChairmanRemuneration MemberCommittee
Pride Hotels Limited Audit Committee ChairmanRoyale Indian Rail Tours Limited Audit Committee Chairman
Tulip Star Hotels Limited Audit Committee Chairman
J Singh
Jagdish Singh (53) DIN 00042258 was appointed as aNon-Executive Director on the Board of the Company on16th April 2016 A Commerce Graduate and a CharteredAccountant Singh joined ITC Limited in the year 1990During these 26 years he has held various positions inthe finance function He started his career in Treasury andmoved as Corporate Accountant Commercial Manager atCigarette factory at Munger and Head of Finance at ITCEssentra Limited He was then the Head of Treasury
between 2005 and 2015 and is presently the Head ofFinance at ITCrsquos Hotels Division
Other DirectorshipsName of the company Position
International Travel House Limited Non-Executive DirectorFortune Park Hotels Limited Non-Executive DirectorBay Islands Hotels Limited Non-Executive DirectorSrinivasa Resorts Limited Non-Executive DirectorMaharaja Heritage Resorts Limited Non-Executive DirectorMimec (India) Limited Non-Executive DirectorLandbase India Limited Additional Non-Executive DirectorLogix Developers Private Limited Non-Executive Director
Committee Membership of other companiesName of the Committee Positioncompany
International Travel House Limited Stakeholders Relationship MemberCommitteeAudit Committee MemberNominations amp Remuneration MemberCommittee
Fortune Park Hotels Limited Corporate Social MemberResponsibility Committee
Srinivasa Resorts Limited Audit Committee ChairmanCorporate Social MemberResponsibility Committee
D R Choudhury
Devkanya Roy Choudhury (41) DIN 07066556 wasappointed as a Non-Executive Director of the Company on19th January 2015 A Graduate from the National LawSchool of India University Bengaluru she joined ITC Limitedin 2001 As part of Corporate Legal of ITC she has rich andvaried experience in handling legal matters pertaining tovarious divisions including Tobacco Hotels Personal CareLifestyle Retailing Education amp Stationery Paperboards ampSpecialty Papers ITC Infotech as also dealing with mergersamp acquisitions and key litigation across ITC CurrentlyMs Choudhury is the Senior Associate General Counsel ofITC Limited
Other Directorships
Name of the Company Position
WelcomHotels Lanka (Private) Limited Non-Executive Director
YOUR DIRECTORS
Denotes foreign company Denotes listed Indian company whose equity shares or preference shares or debt securities are listed on a recognised
stock exchangeNotes1 Other Directorships and Committee Memberships of Directors are as on 15th April 20192 Committee Memberships cover Committees under the Companies Act 2013 viz Audit Committee Stakeholders
Relationship Committee Nomination and Remuneration Committee and CSR Committee of Indian Companies
11
REPORT ON CORPORATE GOVERNANCE
The Directors present the Companyrsquos Report on CorporateGovernance pursuant to the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements)Regulations 2015 (lsquoListing Regulations 2015rsquo)
THE COMPANYrsquoS GOVERNANCE PHILOSOPHY
The Company firmly believes in good CorporateGovernance and has made it a practice and a continuousprocess of development right across the Company TheCompanyrsquos philosophy on Corporate Governanceenvisages attainment of high level of transparency andaccountability in the functioning of the Company andconduct of business and places due emphasis onregulatory compliance It has empowered the ExecutiveManagement to take decisions with regard to day-to-dayoperations and has also created checks and balances thatsuch decisions are taken with care and responsibility tomeet stakeholdersrsquo aspirations and societal expectations
The Companyrsquos corporate philosophy is focused on itspeople who are its most important asset and it values itsemployeesrsquo integrity creativity ability judgement andopinions who in turn demonstrate the highest ethicalstandards and responsibility towards the shareholdersThis has helped the Company take rapid strides in itspursuit of excellence
The Company is committed to enhance shareholder valuein a fair and transparent manner and has been in theforefront for benchmarking itself with the best businesspractices globally
BOARD OF DIRECTORS
All statutory and other significant and material informationare placed before the Board of Directors (the Board) toenable it to discharge its responsibility of strategicsupervision of the Company as trustees of theshareholders
Composition
The Board comprises entirely of Non-Executive Directorsincluding one Woman Director and two IndependentDirectors The strength of the Board as on 15th April 2019is five
The Board Diversity Policy of the Company requires theBoard to have balance of skills experience and diversity ofperspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the Annexure forming part ofthis Report These skills expertise and competencies areavailable in the present mix of the Directors of the Company
Composition of the Board as on 31st March 2019
Category No of PercentageDirectors to total no
of Directors
Non-Executive Independent Directors 3 50Other Non-Executive Directors 3 50Total 6 100
During the year there was no change in the directorshipMr R C Mehta resigned as Non-Executive IndependentDirector of the Company with close of work on 31st March2019 keeping in view the Regulation 17(1A) of ListingRegulations 2015
Mr Mehta has confirmed that there are no other reasons forhis resignation other than stated above
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Board were held The intervening periodbetween two Board meetings was well within the maximumgap of 120 days prescribed under the Listing Regulations2015
Board Agenda
Meetings are governed by a structured agenda The Boardmembers in consultation with the Chairman may bring upany matter for the consideration of the Board All majoragenda items are backed by comprehensive backgroundinformation to enable the Board to take informed decisionsAgenda papers are generally circulated seven days prior tothe Board meeting
Information placed before the Board
The following matters are tabled for the Boardrsquos periodicreview information
bull Annual operating plans amp budgets and periodic reviewof the Companyrsquos businesses
bull Quarterly performance
bull External Audit Management Reports (through the AuditCommittee)
bull Status of legal compliance
bull Status and effectiveness of risk management plans
bull Succession to senior management (through theNominations and Remuneration Committee)
bull Statutory compliance reports
bull Show cause demand prosecution adjudicationnotices if any from revenue authorities which areconsidered materially important including anyexposure that exceeds 1 of the Companyrsquos net worthand their outcome
12
bull W rite-offs disposals (fixed assets receivablesadvances etc) on a half-yearly basis
bull Significant development in Human Resources Industrial Relations
bull Material non-compliance of any regulatory or listingrequirements and in relation to shareholdersrsquoservices
bull All other matters required to be placed before theBoard for its review information under the ListingRegulations 2015 and other statutes
Post-meeting follow-up systemThe Governance processes in the Company include aneffective post-meeting follow-up review and reportingprocess for action taken pending on decisions of the Boardand the Board Committees
Details of Board Meeting during the financial year
During the financial year ended 31st March 2019 fourmeetings of the Board were held as follows
SI Date Board No ofNo Strength Directors
present
1 17th April 2018 6 6
2 7th August 2018 6 6
3 1st November 2018 6 5
4 30th January 2019 6 5
COMMITTEES OF THE BOARD
Currently there are three Committees of the Board ndash theAudit Committee the Stakeholders RelationshipCommittee and the Nominations and RemunerationCommittee The terms of reference of the BoardCommittees are determined by the Board from time to timeMeetings of Board Committees are convened by therespective Committee Chairman All the recommendationsmade by Board Committees during the year were acceptedby the Board Minutes of Board Committee meetings areplaced before the Board for its information The role andcomposition of these Committees including the numberof meetings held during the financial year and the relatedattendance are provided below
A AUDIT COMMITTEEThe Audit Committee of the Board provides reassurance tothe Board on the existence of an effective internal controlenvironment that ensuresbull efficiency and effectiveness of operations
bull safeguarding of assets and adequacy of provisionsfor all liabilities
bull reliability of financial and other managementinformation and adequacy of disclosures
bull compliance with all relevant statutesThe role of the Committee includes the followingbull To oversee the Companyrsquos financial reporting process
and the disclosure of its financial information to
REPORT ON CORPORATE GOVERNANCE
Directorsrsquo attendance at the Board Meetings during the financial year and at the last Annual General Meeting (AGM) as alsotheir other Directorships and Committee Memberships are given below
SI Director Category No of Attendance No of No of Membership(s) No Board at last other Chairmanship(s) of Audit
Meetings AGM Directorship(s) Committee Stakeholdersattended Relationship Committee of
other Indian public limitedcompanies
1 N Anand Chairman amp 4 Yes 8 1Non-Executive Director
2 C K Koshy Non-Executive 4 Yes Nil NilIndependent Director
3 R C Mehta1 Non-Executive 2 Yes 4 NilIndependent Director
4 M Narayanan Non-Executive 4 Yes 4 4 (all as Chairman)Independent Director
5 D R Choudhary Non-Executive Director 4 Yes 1 Nil6 J Singh Non-Executive Director 4 Yes 8 3 (including 1 as Chairman)
1 Resigned as Non-Executive Independent Director wef 1st April 2019 Details with respect to other Directorships of the Directors are provided under the section lsquoYour Directorsrsquo in the Report and Accounts
13
ensure that the financial statements are correctsufficient and credible
bull To recommend the appointment remuneration termsof appointment and removal of Statutory Auditors
bull To approve transactions of the Company with relatedparties
bull To evaluate the Companyrsquos internal financial controlsand risk management systems
bull To review with the management the following
- Annual financial statements and Auditorrsquos Reportthereon before submission to the Board forapproval
- Quarterly financial statements before submissionto the Board for approval
bull To review the following
- Management discussion and analysis of financialcondition amp results of operations and mattersrequired to be included in the DirectorsrsquoResponsibility Statement
- Adequacy of internal control systems and theCompanyrsquos statement on the same prior toendorsement by the Board such review to bedone in consultation with the managementStatutory and Internal Auditors
- Adequacy of internal control systems forcompliance with the provisions of the Securitiesand Exchange Board of India (Prohibition ofInsider Trading) Regulations 2015
- Reports of Internal Audit and discussion withInternal Auditors on any significant findings andfollow-up thereon
- Statutory Auditorsrsquo independence andperformance and effectiveness of the auditprocess
- System for storage retrieval security etc of booksof account maintained in the electronic form
- Functioning of Whistleblower mechanism in theCompany
Composition
The Audit Committee as on 15th April 2019 comprisesthree Non-Executive Directors two of whom are IndependentDirectors The Chairman of the Committee is anIndependent Director The Chief Executive Officer the ChiefFinancial Officer and the representative of Statutory Auditorsare Invitees to meetings of the Audit Committee and theCompany Secretary is the Secretary to the Committee Allmembers of the Committee are financially literate twomembers including the Chairman of the Committee haveaccounting and financial management expertise
The names of the members of the Audit Committeeincluding its Chairman are provided under the sectionlsquoBoard of Directors amp Committeesrsquo in the Report andAccounts
Meetings and Attendance
During the financial year ended 31st March 2019 fourmeetings of the Audit Committee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 4 4
2 7th August 2018 4 4
3 1st November 2018 4 3
4 30th January 2019 4 3
Attendance at Audit Committee Meetings during thefinancial year
Member No of meetingsattended
M Narayanan1 4
C K Koshy 4
R C Mehta2 2
J Singh 41 Appointed Chairman wef 15th April 20192 Ceased to be Member and Chairman wef 1st April 2019
B STAKEHOLDERS RELATIONSHIP COMMITTEE
The Stakeholders Relationship Committee of the Boardoversees redressal of shareholder and investor grievancesand inter alia approves transmission of sharessub-division consolidation renewal of share certificatesissue of duplicate share certificates etc
Composition
The Stakeholders Relationship Committee presentlycomprises three Non-Executive Directors including oneIndependent Director The Chairman of the Committee is aNon-Executive Director The Company Secretary is theSecretary to the Committee
The names of the members of the StakeholdersRelationship Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 sevenmeetings of the Stakeholders Relationship Committeewere held as follows
REPORT ON CORPORATE GOVERNANCE
14
SI Date Committee No ofNo Strength Members
present1 17th April 2018 2 2
2 29th June 2018 2 2
3 7th August 2018 2 2
4 27th September 2018 2 2
5 1st November 2018 2 2
6 4th January 2019 2 2
7 30th January 2019 2 2
Attendance at Stakeholders Relationship CommitteeMeetings during the financial year
Member No of meetingsattended
J Singh 7
D R Choudhury 7
C K Koshy 0
Appointed Member wef 31st March 2019
C NOMINATIONS AND REMUNERATION COMMITTEEThe Nominations and Remuneration Committee of theBoard inter alia identifies persons qualified to becomeDirectors and formulates criteria for evaluation ofperformance of the Directors and the Board as a wholeThe Committeersquos role includes recommending to theBoard the appointment remuneration and removal ofDirectors and Key Managerial Personnel
Composition
The Nominations and Remuneration Committee as on15th April 2019 comprises four Non-Executive Directorstwo of whom are Independent Directors The Chairman ofthe Committee is an Independent Director The CompanySecretary is the Secretary to the Committee
The names of the members of the Nominations andRemuneration Committee including its Chairman areprovided under the section lsquoBoard of Directors ampCommitteesrsquo in the Report and Accounts
Meetings and Attendance
During the financial year ended 31st March 2019 twomeetings of the Nominations and RemunerationCommittee were held as follows
SI Date Committee No ofNo Strength Members
present1 17th April 2018 5 5
2 30th January 2019 5 4
Attendance at Nominations and Remuneration CommitteeMeetings during the financial year
Member No of meetingsattended
C K Koshy 2
N Anand 2
R C Mehta1 1
M Narayanan 2
J Singh 21 Ceased to be Member wef 1st April 2019
Remuneration Policy
The Companyrsquos Remuneration Policy aims at attractingand retaining high calibre talent The Remuneration Policytherefore is market-led and takes into account thecompetitive circumstance of each business so as to attractand retain quality talent and leverage performancesignificantly
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpwwwgujarathotels ltd in polic ies Remuneration-Policy_GHLpdf There has been no change in the Policyduring the year
Remuneration of Directors
Non-Executive Directors are entitled to sitting fees forattending the meetings of the Board and its Committeesthe quantum of which is determined by the Board Thesitting fees to Non-Executive Directors as determined bythe Board are ` 20000- and ` 10000- for each meeting ofthe Board and its Committees respectively
Details of sitting fees paid to the Directors during thefinancial year ended 31st March 2019
Director Sitting Fees (`)
C K Koshy 150000-
R C Mehta1 70000-
M Narayanan 150000-1 Resigned as Non-Executive Independent Director wef1st April 2019
Note Disclosure with respect to Non-Executive Directors ndashPecuniary relationship or transaction None
Performance Evaluation
Performance evaluation of the Board the BoardCommittees and the individual Directors was carried outby the Board in accordance with the Policy approved by theNominations and Remuneration Committee in this regardbrief details of the same are provided in the lsquoReport of theBoard of Directors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
REPORT ON CORPORATE GOVERNANCE
15
Directorsrsquo Shareholding
Details of Shareholding of the Directors in the Company ason 31st March 2019 are given below
Director No of Equity Shares of ` 10-each held singly jointly
N Anand 200
D R Choudhury Nil
C K Koshy Nil
R C Mehta Nil
M Narayanan Nil
J Singh Nil
OTHER DISCLOSURESbull Details of non-compliances penalties and strictures
by Stock Exchanges SEBI Statutory Authorities onany matter related to capital markets during the lastthree years
Nonebull Inter-se relationships between Directors and Key
Managerial Personnel of the Company
Nonebull Materially significant related party transactions which
may have potential conflict with the interests of theCompany at large
Nonebull Material financial and commercial transactions of
senior management where they may have hadpersonal interest and which had potential conflict withthe interests of the Company at large
Nonebull Details of utilisation of funds raised through
preferential allotment or qualified institutionsplacement
Not Applicablebull Credit rating(s) obtained by the Company for any debt
instrument fixed deposit programme or any otherscheme involving mobilisation of funds
Nonebull None of the Directors of the Company has been
debarred or disqualified from being appointed orcontinuing as a Director by SEBI Ministry of CorporateAffairs Statutory Authorities which has also beenconfirmed by Messrs PB amp Associates PractisingCompany Secretaries
bull Confirmation by the Board with respect to theIndependent Directors is provided in the lsquoReport ofthe Board of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Disclosures in relation to the Sexual Harassment ofWomen at Workplace (Prevention Prohibition andRedressal) Act 2013 are provided in the lsquoReport of theBoard of Directors amp Management Discussion andAnalysisrsquo forming part of the Report and Accounts
bull Information with respect to lsquoCommodity Price Risk orForeign Exchange Risk and Hedging Activitiesrsquo
Nonebull The total fees paid by the Company to Messrs K C
Mehta amp Co Statutory Auditors and all other entitiesforming part of the same network aggregate` 100000-
bull Compliance Officer under the Listing Regulations2015
Deepak Kumar Gulati Company Secretary
MEANS OF COMMUNICATION
Timely disclosure of consistent comparable relevant andreliable information on corporate financial performance isat the core of good governance Towards this end thequarterly results of the Company were announced withinforty five days from the end of the quarter Audited annualresults along with the results for the fourth quarter wereannounced within sixty days from the end of the financialyear Extract of these results were published in lsquoTheFinancial Expressrsquo (all editions) and in its Gujarati editionas vernacular newspaper Further quarterly resultsshareholding pattern and other material events amp importantinformation relating to the Company were submitted to BSELimited through BSE Listing Centre for dissemination onits website The Company publishes its quarterlyhalf-yearly and annual financial results and also posts suchresults on its website wwwgujarathotelsltdin
The Report of the Board of Directors forming part of theReport and Accounts includes all aspects of lsquoManagementDiscussion and Analysisrsquo as required under the ListingRegulations 2015
GHL CODE OF CONDUCT FOR PREVENTION OF INSIDERTRADING ndash 2019
The GHL Code of Conduct for Prevention of Insider Tradingapproved by the Board inter alia prohibits trading insecurities of the Company by Directors and employeeswhile in possession of unpublished price sensitiveinformation in relation to the Company
GHL CODE OF CONDUCT
The GHL Code of Conduct is applicable to Directors seniormanagement and employees of the Company The Codeis derived from three interlinked fundamental principlesviz good corporate governance good corporate citizenshipand exemplary personal conduct in relation to theCompanyrsquos business and reputation The Code coversGHLrsquos commitment to sustainable development concern
REPORT ON CORPORATE GOVERNANCE
16
for occupational health safety and environment a genderfriendly workplace transparency and auditability legalcompliance and the philosophy of leading by personalexample The Code is available on the Companyrsquos website
Declaration as required under the Listing Regulations 2015All Directors and senior management of the Companyhave affirmed compliance with the GHL Code of Conductfor the financial year ended 31st March 2019New Delhi K Pahwa15th April 2019 CEO
WHISTLEBLOWER POLICYSynopsis of the Whistleblower Policy of the Company isprovided in the lsquoReport of the Board of Directors ampManagement Discussion and Analysisrsquo forming part of theReport and Accounts The Whistleblower Policy is alsoavailable on the Companyrsquos websiteFAMILIARISATION PROGRAMME FOR DIRECTORSGHL believes that a Board which is well informed familiarised with the Company and its affairs can contributesignificantly to effectively discharge its role of trusteeshipin a manner that fulfils stakeholdersrsquo aspirations andsocietal expectations In pursuit of this the Directors of theCompany are updated on changes developments in thedomestic global corporate and industry scenario includingthose pertaining to statutes legislations and economicenvironment and on matters affecting the Company toenable them to take well informed and timely decisionsFurther details may be accessed on the Companyrsquos websiteat httpwwwgujarathotelsltdinpoliciesDirectorrsquos-Familiarisation-programmespdfPOLICY ON RELATED PARTY TRANSACTIONSThe Policy as approved by the Board may be accessed onthe Companyrsquos website at
h t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_TranscationspdfDISCRETIONARY REQUIREMENTS UNDER THE LISTINGREGULATIONS 2015The status of compliance with the discretionaryrequirements under the Listing Regulations 2015 isprovided below1 Chairmanrsquos Office The Company has a Non-Executive
Chairman but he does not maintain any separate officeand hence no expense in this regard is being incurredby the Company
2 Shareholder Rights The quarterly half-yearly andannual financial results of the Company are postedon the Companyrsquos website and extract of these resultsare published in newspapers on an all India basisThe complete Report and Accounts is sent to everyShareholder of the Company
3 Audit Opinion It has always been the Companyrsquosendevour to present financial statements with
unmodified audit opinion The Statutory Auditors haveissued an unmodified audit opinion on the Companyrsquosfinancial statements for the year ended 31st March2019
4 Separate posts of Chairman and Chief ExecutiveOfficer The Company has a Non-Executive Chairmanand a Chief Executive Officer
5 Internal Audit The Internal Auditor of the CompanyMessrs Shah amp Talati Chartered Accountants reportsto the Audit Committee of the Board
GENERAL SHAREHOLDER INFORMATIONProvided in the lsquoShareholder Informationrsquo section of theReport and Accounts
CONFIRMATION OF COMPLIANCEbull It is confirmed that the Company has complied with
the requirements prescribed under Regulations 17 to27 and clauses (b) to (i) of sub - regulation (2) ofRegulation 46 of the Listing Regulations 2015
bull The Statutory Auditorsrsquo Certificate that the Companyhas complied with the conditions of CorporateGovernance is annexed to the lsquoReport of the Board ofDirectors amp Management Discussion and Analysisrsquoforming part of the Report and Accounts
ANNEXURE TO THE REPORT ON CORPORATEGOVERNANCESKILLS EXPERTISE AND COMPETENCIES OF DIRECTORSThe Company believes that Board members should havea balance of skills experience and diversity of perspectivesappropriate to the Company Accordingly the Directorsshould possess one or more of the following skillsexpertise and competencies
1 Leadership
Leadership experience in a commensurate-sizedorganisation with understanding of organisationalsystems and processes strategic areas andemerging business trends
2 Industry Knowledge and Experience
Domain knowledge of Hotel business and itsdynamics long-term strategies and regulatory ampcompetitive environment
3 Finance and Accounting
Ability to understand financial policies accountingstatements and disclosure practices to contribute tothe financial risk management policies and practicesof the Company
4 Governance
Commitment belief and experience in settinggovernance practices to support the Companys legalcompliance systems and governance polic ies practices
REPORT ON CORPORATE GOVERNANCE
17
SHAREHOLDER INFORMATION
AGM Details
Date Saturday 7th September 2019Venue WelcomHotel Vadodara R C Dutt Road
Alkapuri Vadodara 390 007Time 1100 amBook Friday 30th August 2019 toClosure Saturday 7th September 2019Dates (both days inclusive)Dividend Friday 13th September 2019PaymentDate
Registrar and Share Transfer Agents
Messrs MCS Share Transfer Agent Limited are the Registrarand Share Transfer Agents (RTA) of the Company forcarrying out share registration and other related activitiesof the Company
Address for Correspondence
MCS Share Transfer Agent LimitedF-65 1st Floor Okhla Industrial AreaPhase ndash I New Delhi - 110 020Telephone Nos 011 4140 6149-52 4160 9386Facsimile No 011 4170 9881E-mail helpdeskdelhimcsregistrarscom
Shareholders holding shares in the dematerialised formshould address their correspondence except those relatedto dividend to their respective Depository Participants
Share Transfer Committee
The Share Transfer Committee of the Company generallymeets once in ten days for approving share transfers Theprocessing activities with respect to requests received forshare transfers are completed within fifteen days from thedate of receipt of request The Committee met 11 timesduring the financial year ended 31st March 2019 to approveshare transfers There were no share transfers pendingas on 31st March 2019
The Share Transfer Committee presently comprises thefollowing
D R Choudhury - Director MemberJ Singh - Director MemberM Agarwal - Compliance Officer Member
Dematerialisation of Shares and Liquidity
The shares of the Company are available for trading in thedematerialised form under both the Depository Systems inIndia - NSDL and CDSL The International SecuritiesIdentification Number (lSIN) allotted to the Companysshares under the Depository System is INE621C01011
As on 31st March 2019 a total of 3525013 Equity Sharesof the Company which translates to 9307 of the ShareCapital stood dematerialised The processing activitieswith respect to requests received for dematerialisation arecompleted between fifteen to thirty daysShareholder Investor ComplaintsThe Company attends to Shareholder Investor complaintsqueries and other correspondence generally within fifteendays except where constrained by disputes or legalimpedimentsThe Company did not receive any complaint during thefinancial year ended 31st March 2019The e-mail ID earmarked by the Company for this purposeghlinvestorsyahoocoinDistribution of Shareholding as on 31st March 2019
No of No of EquityNo of Shareholders Shares
SharesSlab Total to Total to
Share Shareholders Capital
1 - 500 5152 9455 587438 1551501 - 1000 138 253 112061 296
1001 - 2000 68 125 100167 2652001 - 3000 26 048 62030 1643001 - 4000 16 029 58804 1554001 - 5000 11 020 50785 1345001 - 10000 23 042 163405 431
10001 - 50000 8 015 147787 39050001 - 100000 3 006 226954 599
100001 amp Above 4 007 2278084 6015Total 5449 10000 3787515 10000
Categories of Shareholders as on 31st March 2019Sl Category No of toNo Shares Share
held hold ingA Promoter Holding1 Promoter and Promoter Group
ITC Limited 1733907 4578Russell Investments Limited 300056 792Sub-Total 2033963 5370
B Non Promoter Holding2 Institutional Investorsa Mutual Funds NIL NILb Banks 100 000c Foreign Institutional Investors and NIL NIL
Foreign Portfolio InvestorsSub-Total 100 000
3 Othersa Private Corporate Bodies 193726 511b Indian Public 1335461 3527c NRIs 102362 270d Others 121903 322
Sub Total 1753452 4630Grand Total 3787515 10000
18
Monthly High and Low Quotes and Volume of Sharestraded on BSE Limited
Year Month High L o w Volume(` ) (` ) (Nos)
2018 April 13800 12000 93584May 13100 11710 26778June 12735 11500 18090July 12195 11400 27113August 12295 11450 14900September 12000 10900 23492October 11400 10505 18787November 12975 10700 15386December 11490 10700 40291
2019 January 11320 10700 22160February 11185 10005 12395March 11295 10400 21625
Performance in comparison to broad based indices suchas SampP BSE Sensex
Note - Indicates monthly closing positions
Listing of Shares on Stock Exchange (with Stock Code)BSE Limited (507960)Phiroze Jeejeebhoy Towers Dalal Street Mumbai 400 001Telephone Nos 022-2272 1233 34Facsimile No 022-2272 1919E-mail isbseindiacomWebsite wwwbseindiacom
The Listing Fee for the financial year 2019-20 has beenpaid to BSE Limited
Financial CalendarFinancial Year 2019-20(1st April - 31st March)
1 First Quarter Results July 20192 Second Quarter and October November 2019
Half-Year Results3 Third Quarter Results January February 20204 Fourth Quarter and May 2020
Annual Results
Particulars of past three AGMsAGM Financial Venue Date Time Special
Year ResolutionPassed
36th 2017-18 WelcomHotel 07-08-2018 NoneVadodara
35th 2016-17 R C Dutt Road 08-08-2017 1100 NoneAlkapuri am
34th 2015-16 Vadodara 20-09-2016 None390 007
Postal Ballot
No special resolution requiring postal ballot was eitherproposed last year or is being proposed for the ensuing AGM
SHAREHOLDER REFERENCER
Transfer of Shares in certificate form
Effective 1st April 2019 transfer of shares of a listedcompany can only be effected in dematerialised form interms of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 Shareholders holdingshares in the certificate form are therefore requested todematerialise their shares in their own interestCommunication in this respect has been sent by theCompany during the year to the concerned ShareholdersHowever transfer deeds which were lodged with theCompany on or before 31st March 2019 but were returneddue to any deficiency will be processed upon re-lodgement
Transfer of Dividend and corresponding Equity Shares tothe Investor Education and Protection Fund (IEPF)
During the financial year 2018-19 unclaimed dividend forthe financial year 2010-11 aggregating ` 636444- andthe corresponding 13150 Equity Shares in respect of whichdividend entitlements remained unclaimed for sevenconsecutive years or more have been transferred by theCompany to the IEPF established by the CentralGovernment pursuant to the provisions of Section 124 ofthe Companies Act 2013 read with the Investor Educationand Protection Fund Authority (Accounting Audit Transferand Refund) Rules 2016
Shareholders may claim their unclaimed dividend for theyears prior to and including the financial year 2010-11 andthe corresponding shares from the IEPF Authority byapplying in the prescribed Form No IEPF-5 This Form canbe downloaded from the website of the IEPF Authoritywwwiepfgovin the access link of which is also availableon the Companys website wwwgujarathotelsltdin underthe section General Information under Shareholder Value
The unclaimed dividend for the undernoted years and thecorresponding shares will be transferred by the Companyto the IEPF in accordance with the schedule given belowAttention in particular is drawn that the unclaimed dividendfor the financial year 2011-12 and the corresponding shareswill be due for transfer to the IEPF on 14th September
SHAREHOLDER INFORMATION
19
Central Depository Services (India) LimitedMarathon Futurex A Wing 25th FloorMafatlal Mill Compound N M Joshi MargLower Parel Mumbai 400 013Telephone No 022-2302 3333Facsimile No 022-2300 2035E-mail helpdeskcdslindiacomWebsite wwwcdslindiacomRemittance of Dividend through Electronic ModeThe Company provides the facility for remittance of dividendto Shareholders through RTGS (Real Time GrossSettlement) NACH (National Automated Clearing House) NEFT (National Electronic Funds Transfer)
Shareholders who have not opted for remittance of dividendthrough electronic mode and wish to avail the same arerequired to provide their bank details including IFSC (IndianFinancial System Code) and MICR (Magnetic Ink CharacterRecognition) to their respective Depository Participants(DPs) or to the RTA where shares are held in thedematerialised form and in the certificate form respectively
Shareholders holding shares in the certificate form mayuse the Mandate Form for this purpose which can bedownloaded from the Companys websitewwwgujarathotelsltdin under the section GeneralInformation under Shareholder Value
Address and Bank DetailsShareholders holding shares in the certificate form arerequested to advise the RTA of any change in their address mandate bank details to facilitate better servicingShareholders are advised that as a measure of protectionagainst fraudulent encashment their bank details oraddress as available with the RTA will be printed on thedividend warrants or demand drafts where dividend cannotbe remitted through electronic mode
Permanent Account Number (PAN)Shareholders holding shares in the certificate form arerequested to send copies of their PAN Cards to the RTA tofacilitate better servicing
Furnishing of PAN Card however is mandatory as followsi) Transferees and Transferors PAN Cards for transfer
of sharesii) Legal heirs Nominees PAN Cards for transmission
of sharesiii) Surviving joint holders PAN Cards for deletion of name
of deceased Shareholders andiv) Joint holders PAN Cards for transposition of shares
Nomination Facility
Shareholders who hold shares in the certificate form andwish to make any nomination change nomination madeearlier in respect of their shareholding in the Companyshould submit to the RTA the prescribed Form such Formcan be downloaded from the Companys website underthe section Investor Relations under Shareholder Value
SHAREHOLDER INFORMATION
2019 for which purpose communication has been sent tothe concerned Shareholders advising them to write to theCompany to claim their dividend Notices in this regardhave also been published in newspapers Details of suchunclaimed dividend and corresponding shares areavailable on the Companys website under the sectionGeneral Information under Shareholder Value
Financial Date of declaration Due date for transferYear of Dividend to IEPF2011-12 8th August 2012 14th September 2019
2012-13 13th August 2013 19th September 2020
2013-14 29th September 2014 5th November 2021
2014-15 29th September2015 5th November 2022
2015-16 20th September 2016 26th October 2023
2016-17 8th August 2017 14th September 2024
2017-18 7th August 2018 12th September 2025
The Company will not be able to entertain any claim receivedafter 12th September 2019
Shareholders who have not so far encashed their dividendwarrant(s) or have not received the same are requested toapply for duplicate warrant(s) by writing to the Companyand confirming non-encashment non-receipt of dividendwarrant(s)
Service of Documents
The Company sends Notices Report and Accounts andother communications in electronic mode to thoseShareholders who have registered their e-mail addresseswith the Company or with the Depositories and in physicalmode to the other Shareholders
Shareholders who wish to register or update their e-mailaddresses with the Company may use the Form forregistration updation which can be downloaded from theCompanys website under the section Investor Relationsunder Shareholder Value
Depository Services
Shareholders may write to the respective Depository or tothe RTA for guidance on depository services
The contact details of the Depositories are given below
National Securities Depository LimitedTrade World A Wing 4th FloorKamala Mills CompoundSenapati Bapat Marg Lower ParelMumbai 400 013Telephone No 022-2499 4200Facsimile No 022-2497 6351E-mail infonsdlcoinWebsite wwwnsdlcoin
20
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
FOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019Your Directors submit their Report for the financial yearended 31st March 2019
BUSINESS ENVIRONMENT
The global economic growth softened to 36 in 2018representing a marked slowdown compared to the 39growth anticipated at the beginning of the year buoyed bya strong fiscal expansion in the USA which was offset largelyby slower growth in some other large economies ieEurope Japan etc Going forward global growth in 2019 isprojected to decline further to 33 in the base case withrisks to the downside emanating from politicaluncertainties rising trade tensions escalatingprotectionism and tighter financial conditions
As per Ministry of Statistics amp Programme Implementation(MSPI) Indian economy registered the GDP growth of 7in 2018-19 as compared to 72 in 2017-18 The economyis expected to grow and maintain a level of 75 in 2019and 2020 as per the World Bank estimates
India is the most digitally-advanced traveller nation in termsof digital tools being used for planning booking andexperiencing a journey During 2018 foreign tourist arrivals(FTAs) in India stood at 1056 million achieving a growthrate of 52 year-on-year The Government of India is alsoworking to achieve 1 share in worldrsquos international touristarrivals by 2020 and 2 share by 2025
The operating environment in the hospitality sector showedimprovement with foreign tourist arrivals Indiarsquos risingmiddle class and increasing disposable incomes havecontinued to support the growth of domestic tourism
With the inauguration of Statue of Sardar Vallabhbhai Patelalso known as lsquoStatute of Unityrsquo which is the higheststanding statue in the world at a height of 182 meters thetourism in the city of Vadodara is expected to grow
FINANCIAL PERFORMANCE
During the year under review your Company earned licensefees of ` 36987 lakhs (previous year ` 33098 lakhs)Theother income at ` 19626 lakhs showed an increase mainlydue to improvement in return on current investment Preand post-tax profits increased to ` 51822 lakhs (previousyear ` 45313 lakhs) and ` 40788 lakhs (previous year` 33690 lakhs) respectively
Your Directors are pleased to recommend a dividend of` 350 per Equity Share of ` 10- each for the year ended31st March 2019 thereby maintaining last yearrsquos dividendand involving a cash outflow of ` 160 lakhs includingDividend Distribution Tax of ` 27 Lakhs
PROFITS DIVIDEND AND RETAINED EARNINGS
The financial results of your Company summarised areas under
For the year ended For the year ended31st March 2019 31st March 2018
Profits (` ) (` )
a Profit Before Tax 51822363 45312928
b Tax Expense
Current Tax 11653499 9272310Deferred Tax (618755) 2350502
c Profit for the year 40787619 33690116
d Other Comprehensive Income - -
e Total Comprehensive Income 40787619 33690116
Statement of Retained Earningsa At the beginning of the year 213211090 195873461
b Add Total Comprehensive Income 40787619 33690116
c Less Dividend paid including IncomeTax on Dividend paid 15981176 15954974
d Less Income Tax on Dividend paid forearlier year - 397513
e At the end of the year 238017533 213211090
Your Directors are pleased to recommend a dividend of` 350 per Equity Share (Previous Year ` 350) of ` 10-each for the year ended 31st March 2019
Details of changes in Key Financial Ratio amp Return onNet Worth
The key financial ratio of the Company where there hasbeen significant change (25 or more) and change inReturn on Net Worth are summarized below pursuant toSchedule V (B) to the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements)Regulations 2015 (Listing Regulations 2015)
HOTEL OPERATIONS
Your Hotel WelcomHotel Vadodara licensed to ITC Limitedrecorded an income of ` 249443 lakhs during the year ascompared to ` 221856 lakhs in the previous year Therewas an improvement in both occupancy and average roomrates leading to an overall improvement in HotelPerformance
Financial Ratio
2018-19 2017-18 Change
Reason for change
Current Ratio
278 223 25 Increase in value of current investment based on accumulation of market return and fresh investment done during the year out of surplus funds
Return on Net Worth
133 120 11 Due to higher rate of growth in profit after tax
21
The Food amp Beverage segment of your Companyrsquos Hotelcontinues to be a major strength The Peshawri Restaurantand the Welcom Cafeacute Cambay both retained their premiumleadership positions
Your Company has filed a writ petition in the Gujarat HighCourt seeking that the Gujarat State Government be directedto take action on your Companyrsquos application to have theleasehold land of the Hotel converted to freehold andtransferred to your Company as per the existing governmentpolicy in this regard The Honourable High Court passedan Order on 24th December 2014 restraining the StateGovernment from disturbing the peaceful and actualpossession of the Company over the hotel property in anymanner including construction thereon The writ petition ispending
Your Company is also making all efforts for expeditiousconversion of land from leasehold to freehold or in thealternative extension of Lease For further details pleaserefer to Note no 20A of the Accounts
SUBSIDIARIES ASSOCIATES AND JOINT VENTURES
The Company does not have any subsidiary associate orjoint venture
INTERNAL FINANCIAL CONTROLS
Your Company is managed by the Board of Directors andthe Executive Management with clearly defined rolesresponsibilities and authorities The Executive Managementis responsible for the day-to-day conduct of the affairs ofthe Company within the overall framework approved by theBoard Your Company also has a Code of Conduct whichrequires management to conform to the required financialand accounting policies systems and processes conductbusiness ethically and ensure strict compliance with allapplicable laws and regulations Ongoing ReviewProcesses and the Risk Management Framework create acontrol environment in the Company and provide thecornerstones for Internal Financial Controls with referenceto your Companyrsquos Financial Statements
Your Companyrsquos Financial Statements are prepared on thebasis of the Significant Accounting Policies that are carefullyselected by the management and approved by the AuditCommittee and the Board These Policies are reviewedand updated from time to time and audited by the InternalAuditor whose findings and recommendations are reviewedby the Audit Committee and tracked through toimplementation
Your Company maintains its Books of Account in electronicform Your Company has in place adequate internalfinancial controls with reference to the FinancialStatements
The Internal Auditors of the Company evaluates theadequacy and efficacy of such internal financial controlsSuch controls have been assessed during the year by the
management Based on the results of this assessmentno reportable material weakness or significant deficienciesin the design or operation of internal financial controls wereobserved Nonetheless your Company recognises that anyinternal financial control framework no matter how welldesigned has inherent limitations and accordingly regularaudit and review processes ensure that such systems arereinforced on an ongoing basis
RISK MANAGEMENT
Your Company continues its emphasis on a systems-basedapproach to business risk managementBacked by stronginternal control systems the current Risk Managementframework consists of the following key elements
- The Board of Directors (lsquoThe Boardrsquo) has clearly laiddown the roles and responsibilities of the Company inrelation to risk management covering a range ofresponsibilities from strategic to operational Theserole definitions provide the foundation for yourCompanyrsquos Risk Management Policy that is endorsedby the Board and is aimed at ensuring formulation ofappropriate risk management procedures theireffective implementation and independent monitoringand reporting by Internal Audit
- Management of risks vest with the ExecutiveManagement which is responsible for the day-to-dayconduct of the affairs of the Company within the overallframework approved by the Board
- A combination of policies and procedures which areregularly reviewed and updated in the light of changingbusiness and regulatory environment bringsrobustness to the process of ensuring that businessrisks are effectively addressed
- Appropriate structures are in place to proactivelymonitor and manage the inherent risks in businesswith unique relatively high risk profiles
- An Independent Internal Audit Firm carries out riskfocused audits enabling identification of areas whererisk management processes may need to bestrengthened
- The Audit Committee of the Board reviews the InternalAudit findings and provides strategic guidance oninternal controls The Chief Executive Officer closelymonitors the internal control environment within yourCompany including implementation of the action plansemerging out of internal audit findings
The combination of policies and processes as outlinedabove adequately address the various risks associatedwith your Companyrsquos business
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
22
AUDIT AND SYSTEMS
Your Company believes that internal control is a necessaryadjunct to the principle of governance that freedom ofmanagement should be exercised within a framework ofappropriate checks and balances Your Company remainscommitted to ensuring an effective internal controlenvironment that provides assurance and comfort on orderlyand efficient conduct of operations security of assetsprevention and detection of frauds errors accuracy andcompleteness of accounting records and timely preparationof reliable financial information
Your Companyrsquos independent and robust Internal Auditprocesses provide assurance on the adequacy andeffectiveness of internal controls compliance withoperating systems internal policies and regulatoryrequirements
The Internal Audit function consisting of an outsourcedprofessional firm is adequately resourced to deliver highstandards of audit assurances
The Audit Committee of your Board met four times duringthe year The Terms of Reference of the Audit Committeeincluded reviewing the adequacy and effectiveness of theinternal control environment monitoring implementationof the action plans emerging out of Internal Audit findingsincluding those relating to strengthening of your Companyrsquosrisk management systems and discharge of statutorymandate
HUMAN RESOURCE DEVELOPMENT
Your Company firmly believes that employees are the vitaland most valuable assets and hence has created afavourable work environment that encourages innovationand meritocracy Your Company continues to innovate inthe way human resources are managed and developedstriking a balance between business needs and individualaspirations
With an undying commitment to render delightful servicesyour Companyrsquos employees consistently work towardsdelivering flawless performance and are continuing todelight customers
The Company provides a safe secure inclusive and genderfriendly workplace The Company has put in placeGrievance Redressal Procedures and adopted a Policy onSexual Harassment as per the provisions of the SexualHarassment of W omen at W orkplace (PreventionProhibition and Redressal) Act 2013 and the Rules framedthereunder The Company has an Internal ComplaintsCommittee to ensure that grievances in this regard if anyare effectively addressed During the year under review nocomplaint relating to sexual harassment has beenreceived
WHISTLEBLOWER POLICY
The Companyrsquos W histleblower Policy encouragesDirectors and employees to bring to the Companyrsquosattention instances of unethical behavior actual orsuspected incidents of fraud actual or suspectedinstances of leak of unpublished price sensitive informationor violation of the GHL Code of Conduct that could adverselyimpact the Companyrsquos operations business performanceand or reputation The Policy provides that the Companyinvestigates such incidents when reported in an impartialmanner and takes appropriate action to ensure that therequisite standards of professional and ethical conductare always upheld It is the Companyrsquos Policy to ensurethat no employee is victimised or harassed for bringingsuch incidents to the attention of the Company
The practice of the Whistleblower Policy is overseen by theAudit Committee and no employee has been denied accessto the Committee The Whistleblower Policy is available onthe Companyrsquos website at httpwwwgujarathotelsltdinCorporateGovernancehtml
DEPOSITS
Your Company has not accepted any deposits from thepublic members under Section 73 of the Companies Act2013 (lsquothe Actrsquo) read with the Companies (Acceptance ofDeposits) Rules 2014 during the year
DIRECTORS
Changes in Directors
Mr R C Mehta stepped down as Non-Executive IndependentDirector of the Company with effect from close of work on31st March 2019 keeping in view the Regulation 17(1A) ofthe Listing Regulations 2015 Your Directors would like torecord their appreciation for the services rendered byMr Mehta
The Board at the meeting held on 15th April 2019 on therecommendation of the Nominations and RemunerationCommittee recommended for the approval of the Membersthe re-appointment of Mr C K Koshy and Mr M Narayananas independent directors of your Company in terms ofSection 149 of the Act and Regulation 17 of the ListingRegulations 2015 with effect from 29th September 2019
Requisite Notices under Section 160 of the Act have beenreceived in respect of Messrs Koshy and Narayanan whohave filed their consents to act as Directors of the Companyif appointed
Appropriate resolutions seeking your approval to theaforesaid appointment will appear in the Notice conveningthe Thirty Seventh AGM of your Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
23
Retirement by Rotation
In accordance with the provisions of Section 152 of the Actread with Article 147 of the Articles of Association of theCompany Mr Jagdish Singh will retire by rotation at theensuing Annual General Meeting (lsquoAGMrsquo) of your Companyand being eligible offers himself for re-election Your Boardrecommends his re-election
Number of Board Meetings
During the year ended 31st March 2019 four meetings ofthe Board were held
Attributes Qualifications amp Independence of Directorsand their Appointment
As reported last year the Nominations and RemunerationCommittee of the Board had approved the criteria fordetermining qualifications positive attributes andindependence of Directors in terms of the Act and the Rulesthereunder both in respect of Independent Directors andother Directors as applicable The criteria inter aliarequires that NonndashExecutive Directors includingIndependent Directors be drawn from amongst eminentprofessionals with experience in business finance law public administration and enterprises
The Board Diversity Policy of the Company requires theBoard to have a balance of skills experience and diversityof perspectives appropriate to the Company The skillsexpertise and competencies of the Directors as identifiedby the Board are provided in the lsquoReport on CorporateGovernancersquo forming part of the Report and Accounts TheArticles of Association of the Company provide that thestrength of the Board shall not be fewer than three normore than twelve
Directors are appointed re-appointed with the approval ofthe Members All Directors other than IndependentDirectors are liable to retire by rotation unless otherwiseapproved by the Members One-third of the Directors whoare liable to retire by rotation retire every year and areeligible for re-election
The Independent Directors of your Company haveconfirmed that (a) they meet the criteria of independenceas prescribed under Section 149 of the Act and Regulation16 of the Listing Regulations 2015 and (b) they are notaware of any circumstance or situation which could impairor impact their ability to discharge duties with an objectiveindependent judgement and without any external influenceFurther in the opinion of the Board the IndependentDirectors fulfil the conditions prescribed under the ListingRegulations 2015 and are independent of the managementof the Company
The Companyrsquos Policy on remuneration of Directors KeyManagerial Personnel and other employees as approvedby the Board may be accessed on its website at httpw w wg u j a ra th o te ls l td in p o l i c ies R em u n era t io n -
Policy_GHLpdf There has been no change in the Policyduring the year
Board Evaluation
The Nominations and Remuneration Committee hasapproved the Policy on Board Evaluation Evaluation ofBoard Committeesrsquo functioning and individual DirectorEvaluation and also specified that such evaluation will bedone by the Board Board performance is assessed againstthe role and responsibilities of the Board as provided inthe Act and the Listing Regulations 2015 The parametersfor Board performance evaluation have been derived fromthe Boardrsquos core role of trusteeship to protect and enhanceshareholder value as well as fulfil expectations of otherstakeholders through strategic supervision of the CompanyEvaluation of functioning of Board Committees is basedon discussions amongst Committee members and sharedby each Committee Chairman with the Board IndividualDirectors are evaluated in the context of the role played byeach Director as a member of the Board at its meetingsand in assisting the Board in realising its role of strategicsupervision of the functioning of the Company in pursuit ofits purpose and goals
While the Board evaluated its performance against theparameters laid down by the Nominations andRemuneration Committee the evaluation of individualDirectors was carried out anonymously in order to ensureobjectivity The Board was briefed on functioning of BoardCommittees by the respective Committee Chairmen
Key Managerial Personnel
Mr Deependra Rana resigned as the Chief Executive Officerof the Company with effect from 17th December 2018
The Board at the meeting held on 30th January 2019 onthe recommendation of the Nominations andRemuneration Committee appointed Mr Kunal Pahwa asthe Chief Executive Officer of the Company with effect from1st February 2019
AUDIT COMMITTEE amp AUDITORS
The composition of the Audit Committee is provided underthe section lsquoBoard of Directors amp Committeesrsquo in the Reportand Accounts
Statutory Auditors
The Statutory Auditors Messrs K C Mehta amp Co CharteredAccountants (KCM) were appointed with your approval atthe Thirty Fifth AGM to hold such office till the conclusion ofthe Fortieth AGM
On the recommendation of the Audit Committee the Boardrecommended for the approval of the Members paymentof remuneration of KCM for the financial year 2019-20Appropriate resolution for this purpose will appear in theNotice convening the Thirty Seventh AGM of the Company
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
24
Secretarial Auditors
Your Board appointed Messrs PB amp Associates CompanySecretaries to conduct the secretarial audit of the Companyfor the financial year ended 31st March 2019 Their Reportis provided in the Annexure forming part of this Report interms of Section 204 of the Act
RELATED PARTY TRANSACTIONS
All contracts or arrangements entered into by the Companywith its related parties during the financial year were inaccordance with the provisions of the Act and the ListingRegulations 2015 All such contracts or arrangements wereentered in the ordinary course of business and on armrsquoslength basis and have been approved by the AuditCommittee
Further the details of related party transactions of theCompany in prescribed Form No AOC-2 in terms of Section134 of the Act read with Rule 8 of the Companies (Accounts)Rules 2014 is given in the Annexure to this Report YourCompanyrsquos Policy on Related Party Transactions asadopted by your Board can be accessed on the website ath t t p w w w g u j a r a t h o t e l s l t d i n p o l i c i e s Policy_on_Related_Party_Transactionspdf
DIRECTORSrsquo RESPONSIBILITY STATEMENT
As required under Section 134 of the Act your Directorsconfirm having
a) followed in the preparation of the Annual Accounts theapplicable Accounting Standards with properexplanation relating to material departures if any
b) selected such accounting policies and applied themconsistently and made judgements and estimates thatare reasonable and prudent so as to give a true andfair view of the state of affairs of your Company at theend of the financial year and of the profit of yourCompany for that period
c) taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with theprovisions of the Act for safeguarding the assets ofyour Company and for preventing and detecting fraudand other irregularities
d) prepared the Annual Accounts on a going concernbasis
e) laid down internal financial controls to be followed byyour Company and that such internal financial controlswere adequate and operating effectively and
f) devised proper systems to ensure compliance withthe provisions of all applicable laws and that suchsystems were adequate and operating effectively
OTHER INFORMATION
Compliance with the conditions of Corporate Governance
The certificate of the Statutory Auditors Messrs K C Mehtaamp Co Chartered Accountants confirming compliance withthe conditions of Corporate Governance as stipulated underthe Listing Regulations 2015 is annexed
Compliance with Secretarial Standards
The Company is in compliance with the applicableSecretarial Standards issued by the Institute of CompanySecretaries of India and approved by the CentralGovernment under Section 118 of the Act
Cost Records
The Company is not required to maintain cost records interms of Section 148 of the Act read with the Companies(Cost Records and Audit) Rules 2014
Going Concern Status
There is no significant or material order passed during theyear by any regulator court or tribunal impacting the goingconcern status of the Company or its future operations
Extract of Annual Return
The information required under Section 134 of the Act readwith Rule 12 of the Companies (Management andAdministration) Rules 2014 is annexed
Particulars of Loans Guarantees or Investments
During the year ended 31st March 2019 the Company hasneither given any loan or guarantee nor has made anyinvestment under the provisions of Section 186 of the Act
Particulars relating to Conservation of Energy andTechnology Absorption
Particulars as required under Section 134 of the Act relatingto Conservation of Energy and Technology Absorption areprovided below-
Conservation of Energy
Steps taken on conservation of energy and impact thereof
Sl DescriptionNo
1 Installation of energy efficient Gas Burners and Induction Cooker
2 Improvement in energy usage efficiency in lighting system by changingover to efficient lighting solutions such as Light Emitting Diodes
3 Replacement of existing motors and pumps with more energy efficientequipment
4 Process improvement to enhance productivity and reduce specificenergy consumption
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
25
There were no employees who were employed throughoutthe year and were in receipt of remuneration aggregating` 102 crores or more or were employed for part of the yearand were in receipt of remuneration aggregating ` 850lakhs per month or more during the financial year ended31st March 2019
The information pursuant to Section 197 of the Act readwith Rule 5(2) and 5(3) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014containing the names of top 10 employees in terms ofremuneration drawn is provided in the Annexure formingpart of this report
The information required under Section 197(12) of the Actand the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is provided in theAnnexure forming part of this Report
FORWARD-LOOKING STATEMENTS
This Report contains forward-looking statements thatinvolve risks and uncertainties When used in this Reportthe words lsquoanticipatersquo lsquobelieversquo lsquoestimatersquo lsquoexpectrsquo lsquointendrsquolsquowillrsquo and other similar expressions as they relate to theCompany and or its Businesses are intended to identifysuch forward-looking statements The Companyundertakes no obligation to publicly update or revise anyforward-looking statements whether as a result of newinformation future events or otherwise Actual resultsperformances or achievements could differ materially fromthose expressed or implied in such forward-lookingstatements Readers are cautioned not to place unduereliance on these forward-looking statements that speakonly as of their dates This Report should be read inconjunction with the financial statements included hereinand the notes thereto
CONCLUSION
Your Directors and employees look forward to the futurewith confidence and stand committed to creating an evenbrighter future for all stakeholders
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
REPORT OF THE BOARD OF DIRECTORS amp MANAGEMENT DISCUSSION AND ANALYSIS
Steps taken by the Company for utilising alternate sourcesof energy NIL
Capital investment on energy conservation equipment NIL
Technology Absorption
i) Efforts in brief made towards technology absorptionand benefits derived as a result of the above effortseg product improvement cost reduction productdevelopment import substitution etc
Sl Description BenefitsNo
1 Upgradation of Fire Alarm and For Product UpgradationPublic Announcement system
2 Installation of Hoods and Fire For Product UpgradationSuppression system
3 Upgradation of CCTV monitoring For Product Upgradationsystem
4 Upgradation of Electrical Panel For Product Improvement5 Induction of Diesel Generator For Product Improvement
ii) In case of imported technology (imported during thelast 3 years reckoned from the beginning of the financialyear) following information may be furnished
A) Details of technology imported - NIL
B) Year of import - NIL
C) Whether the technology has been fully absorbed -NIL
D) If not fully absorbed areas where absorption hasnot taken place and the reasons therefor - NIL
iii) Expenditure incurred on research and development -NIL
FOREIGN EXCHANGE EARNINGS AND OUTGO
During the financial year 2018-19 foreign exchangeearnings of the Hotel aggregated ` 111754 lakhs (previousyear ` 95887 lakhs) while expenditure in foreign currencyaggregated ` 5514 lakhs (previous year ` 3230 lakhs)
EMPLOYEES
The total number of employees of the Company as on31st March 2019 stood at 198
26
ANNEXURE
FORM NO MR ndash 3SECRETARIAL AUDIT REPORTFOR THE FINANCIAL YEAR ENDED 31ST MARCH 2019[Pursuant to Section 204(1) of the Companies Act 2013 and Rule9 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014]
ToThe MembersGujarat Hotels LimitedWe have conducted the secretarial audit of the compliance ofapplicable statutory provisions and the adherence to goodcorporate practices by Gujarat Hotels Limited a Companyincorporated under the provisions of the Companies Act 1956 andhaving its Registered Office at WelcomHotel Vadodara R C DuttRoad Alkapuri Vadodara Gujarat ndash 390 007 (hereinafter referredto as the lsquoCompanyrsquo) for the period commencing from 1st April2018 till 31st March 2019 (hereinafter referred to as the lsquoAuditPeriodrsquo) Secretarial Audit was conducted in a manner that providedus a reasonable basis for evaluating the corporate conducts statutory compliances and expressing our opinions thereonBased on our verification of the books papers minute booksforms and returns filed and other records maintained by theCompany and also the information provided by the Company itsofficers agents and authorised representatives during the conductof Secretarial Audit 2018-19 we hereby report that in our opinionthe Company has during the audit period covering the FinancialYear ended on 31st March 2019 complied with the statutoryprovisions listed hereunder and also that the Company has properBoard-processes and compliance-mechanism in place to theextent in the manner and subject to the reporting made hereinafterWe have examined the books papers minute books forms andreturns filed and other records maintained by the Company for thefinancial year ended on 31st March 2019 according to theprovisions of(i) The Companies Act 2013 (the Act) and the Rules made
thereunder(ii) The Securities Contracts (Regulation) Act 1956 (lsquoSCRArsquo)
and the Rules made thereunder(iii) The Depositories Act 1996 and the Regulations and
Bye-laws framed thereunder(iv) Foreign Exchange Management Act 1999 and the Rules and
Regulations made thereunder to the extent of Foreign DirectInvestment Overseas Direct Investment and ExternalCommercial Borrowings
(v) The following Regulations and Guidelines prescribed underthe Securities and Exchange Board of India Act 1992(lsquoSEBI Actrsquo)-(a) The Securities and Exchange Board of India
(Substantial Acquisition of Shares and Takeovers)Regulations 2011
(b) The Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations 2015
(c) The Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations2015
(d) The Securities and Exchange Board of India(Registrars to an Issue and Share Transfer Agents)Regulations 1993 regarding the Companies Act anddealing with client
We have also examined compliance with the applicable clauses ofthe following(i) The mandatory Secretarial Standards issued by The Institute
of Company Secretaries of India with respect to BoardMeetings and General Meetings
(ii) The SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015
The Company has entered into an Operating Licence Agreementwith ITC Limited which operates the Hotel ndash WelcomHotel Vadodraand ensure compliance of all laws as applicable for running andmaintenance of the HotelDuring the period under review the Company has complied withthe provisions of the Act Rules Regulations Guidelines andStandards etc as mentioned above however in the CorporateGovernance Report filed pursuant to Regulation 27(2) of SEBI(Listing Obligations and Disclosure Requirements) Regulation 2015with BSE for the quarter ended September and December 2018there is mismatch of date of the meetingWe further report thatThe Board of Directors of the Company is duly constituted withproper balance of Non-Executive Directors and IndependentDirectors The changes in the composition of the Board of Directorsthat took place during the period under review were carried out incompliance with provisions of the ActAdequate notice is given to all Directors for the Board Meetingsand Committees Meetings agenda and detailed notes on agendawere sent at least seven days in advance and where the meetingwas held in shorter notice due compliance was made and a systemexists for seeking and obtaining further information and clarificationson the agenda items before the meeting for meaningful participationat the meetingAll decisions at Board Meetings and Committee Meetings werecarried out unanimously as recorded in the minutes of the meetingsof the Board of Directors or Committees of the Board as the casemay beWe report that there are adequate systems and processes in theCompany commensurate with the size and operations of theCompany to monitor and ensure compliance with the applicableLaws Rules Regulations and GuidelinesWe further report that during the Audit Period the Company has nospecific events actions that have a major bearing on the Companyrsquosaffairs in pursuance of the above referred Laws RulesRegulations Guidelines Standards etc
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
Note This report is to be read with our letter of even date whichis annexed as Annexure A and forms an integral part of thisreport
27
FORM NO AOC-2[Pursuant to Section 134(3)(h) of the Companies Act 2013 and Rule 8(2) of the Companies (Accounts) Rules 2014]
Form for disclosure of particulars of contracts arrangements entered into by the Company with related parties referred to insub-section (1) of Section 188 of the Companies Act 2013 including certain arms length transactions under fourth proviso thereto
1 Details of contracts or arrangements or transactions not at arms length basis
a) Name(s) of the related party and nature of relationshipb) Nature of contracts arrangements transactionsc) Duration of the contracts arrangements transactionsd) Salient terms of the contracts or arrangements or transactions including the value if anye) Justification for entering into such contracts or arrangements or transactions NILf ) Date(s) of approval by the Boardg) Amount paid as advances if anyh) Date on which the special resolution was passed in general meeting as required under first proviso to Section 188
2 Details of material contracts or arrangement or transactions at arms length basis
a) Name(s) of the related party and nature of ITC Limited of which the Company is an Associaterelationship
b) Nature of contracts arrangements transactions Agreement for operating the Companyrsquos Hotel
c) Duration of the contracts arrangements Operating License Agreement (OLA) dated 24th September 1992 for an initialtransactions period of 30 years and renewable for another period of 30 years The OLA
emanated from the rehabilitation package agreed amongst Gujarat State GovtFinancial Institutions viz IFCI amp SBI and ITC in the year 1990
d) Salient terms of the contracts or arrangements The Company receives Licence fees 15 of Net Operating Income Valueor transactions including the value if any of transaction during the year ` 370 crores
e) Date(s) of approval by the Board if any 24th September 1992f ) Amount paid as advances if any Nil
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Annexure AToThe MembersGujarat Hotels Limited
Our report of even date is to be read along with this letter
1 Maintenance of secretarial record is the responsibilityof the management of the Company Our responsibilityis to express an opinion on these secretarial recordsbased on our audit
2 We have followed the audit practices and processesas were appropriate to obtain reasonable assuranceabout the correctness of the contents of the secretarialrecords The verification was done on the randomtest basis to ensure that correct facts are reflected insecretarial records We believe that the processesand practices we followed provide a reasonablebasis for our opinion
3 W e have not verified the correctness andappropriateness of financial records and books ofaccounts of the Company
4 W herever required we have obtained theManagement Representation about the complianceof Laws Rules and Regulations and happening ofevents etc
5 The compliance of the provisions of corporate andother applicable Laws Rules RegulationsStandards is the responsibility of management Ourexamination was limited to the verification ofprocedures on the random test basis
6 The Secretarial Audit Report is neither an assuranceas to the future viability of the Company nor of theefficacy or effectiveness with which the managementhas conducted the affairs of the Company
For P B amp AssociatesCompany Secretaries
Place New Delhi Pooja BhatiaDated 15th April 2019 FCS 7673 CP 6485
28
INDEPENDENT AUDITORSrsquo CERTIFICATE ON CORPORATE GOVERNANCE
INDEPENDENT AUDITORrsquoS CERTIFICATE ON CORPORATEGOVERNANCE
TO THE MEMBERS OF GUJARAT HOTELS LIMITED
1 We have examined the compliance of conditions ofCorporate Governance by Gujarat Hotels Limited (ldquotheCompanyrdquo) for the year ended on 31st March 2019as stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the Securities and Exchange Board ofIndia (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended(ldquoSEBI Listing Regulationsrdquo)
Managementrsquos Responsibility
2 The compliance of conditions of CorporateGovernance is the responsibility of the ManagementThis responsibility includes the designimplementation and maintenance of internal controland procedures to ensure the compliance with theconditions of the Corporate Governance stipulated inSEBI Listing Regulations
Auditorrsquos Responsibility
3 Our responsibility is limited to examining theprocedures and implementation thereof adopted bythe Company for ensuring the compliance of theconditions of the Corporate Governance It is neitheran audit nor an expression of opinion on the financialstatements of the Company
4 We have examined the books of account and otherrelevant records and documents maintained by theCompany for the purpose of providing reasonableassurance on the compliance with CorporateGovernance requirements by the Company
5 We have carried out an examination of the relevantrecords of the Company in accordance with theGuidance Note on Certification of CorporateGovernance issued by the Institute of CharteredAccountants of India (ldquothe ICAIrdquo) the Standards onAuditing specified under Section 143(10) of theCompanies Act 2013 in so far as applicable for the
purpose of this certificate and as per the GuidanceNote on Reports or Certificates for Special Purposesissued by the ICAI which requires that we comply withthe ethical requirements of the Code of Ethics issuedby the ICAI
6 W e have complied with the relevant applicablerequirements of the Standard on Quality Control (SQC)1 Quality Control for Firms that Perform Audits andReviews of Historical Financial Information and otherAssurance and Related Services Engagements
Opinion
7 Based on our examination of the relevant recordsand according to the information and explanationsprovided to us and representations provided by theManagement we certify that the Company hascomplied with the conditions of Corporate Governanceas stipulated in Regulations 17 to 27 clauses (b) to(i) of Regulation 46(2) and paragraphs C and D ofSchedule V of the SEBI Listing Regulations asapplicable for the year ended 31st March 2019
8 W e state that such compliance is neither anassurance as to the future viability of the Companynor the efficiency or effectiveness with which theManagement has conducted the affairs of theCompany
Restrictions on Use
9 This Certificate is issued solely for the purpose ofcomplying with the aforesaid SEBI ListingRegulations and may not be suitable for any otherpurpose
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
29
ANNEXURE
FORM NO MGT-9EXTRACT OF ANNUAL RETURN
as on the Financial Year ended on 31st March 2019[Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the
Companies (Management and Administration) Rules 2014]
I REGISTRATION AND OTHER DETAILS
i) CIN L55100GJ1982PLC005408ii) Registration Date 7th August 1982iii) Name of the Company Gujarat Hotels Limitediv) Category Sub-Category of the Company Public company - Limited by sharesv) Address of the Registered office and contact details WelcomHotel Vadodara
R C Dutt Road AlkapuriVadodara 390 007Tel No 0265-233 0033E-mail ghlinvestorsyahoocoin
vi) Whether Listed Company Yesvii) Name Address and Contact details of MCS Share Transfer Agent Limited
Registrar and Transfer Agent if any F - 65 Okhla Industrial Area Phase - INew Delhi - 110 020Tel Nos (011) 4140 6149-52 4160 9386
II PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY
III PARTICULARS OF HOLDING SUBSIDIARY AND ASSOCIATE COMPANIES NIL
Sl No
Name and Description of main products services NIC Code of the products services
to total turnover of the Company
1 Hotel Services 55101 100
30
IV SHAREHOLDING PATTERN (Equity Share Capital Break-up as percentage of Total Equity)(i) Category-wise Shareholding
Category of Shareholders No of Shares held at the beginningof the year
No of Shares held at the endof the year
Changeduring the
year
A Promoters(1) Indiana) Individual HUF 0 0 0 0 0 0 0 0 0b) Central Govt 0 0 0 0 0 0 0 0 0c) State Govt(s) 0 0 0 0 0 0 0 0 0d) Bodies Corp 2033963 0 2033963 5370 2033963 0 2033963 5370 0e) Banks FI 0 0 0 0 0 0 0 0 0f ) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(1) 2033963 0 2033963 5370 2033963 0 2033963 5370 0(2) Foreigna) NRIs - Individuals 0 0 0 0 0 0 0 0 0b) Other - Individuals 0 0 0 0 0 0 0 0 0c) Bodies Corp 0 0 0 0 0 0 0 0 0d) Banks FI 0 0 0 0 0 0 0 0 0e) Any Other 0 0 0 0 0 0 0 0 0Sub-total (A)(2) 0 0 0 0 0 0 0 0 0Total Shareholding of Promoter(A) = (A)(1)+(A)(2) 2033963 0 2033963 5370 2033963 0 2033963 5370 0B Public Shareholding1 Institutionsa) Mutual Funds 0 0 0 0 0 0 0 0 0b) Banks FI 0 100 100 0 100 100 c) Central Govt 0 0 0 0 0 0 0 0 0d) State Govt(s) 0 0 0 0 0 0 0 0 0e) Venture Capital Funds 0 0 0 0 0 0 0 0 0f ) Insurance Companies 0 0 0 0 0 0 0 0 0g) FIIs 10 0 10 0 0 0 h) Foreign Venture Capital Funds 0 0 0 0 0 0 0 0 0i) Others (specify) 0 0 0 0 0 0 0 0 0Sub-total (B)(1) 10 100 110 0 100 100 2 Non-Institutionsa) Bodies Corpi) Indian 300003 2200 302203 798 191626 2100 193726 511 (287)ii) Overseas 0 0 0 0 0 0 0 0 0b) Individualsi) Individual shareholders holding
nominal share capital upto` 1 lakh 774322 231562 1005884 2656 797094 203602 1000696 2643 (013)
ii) Individual shareholders holdingnominal share capital inexcess of ` 1 lakh 220814 0 220814 583 334765 0 334765 884 301
c) Others (specify)i) Non Resident Individuals 44288 71500 115788 306 45662 56700 102362 270 (036)ii) Investor Education and
Protection Fund AuthorityMinistry of Corporate Affairs 108753 0 108753 287 121903 0 121903 322 035
Sub-total (B)(2) 1448180 305262 1753442 4630 1491050 262402 1753452 4630 0Total Public Shareholding(B)=(B)(1)+ (B)(2) 1448190 305362 1753552 4630 1491050 262502 1753552 4630 0C Shares held by Custodian
for GDRs amp ADRs 0 0 0 0 0 0 0 0 0Grand Total (A+B+C) 3482153 305362 3787515 100 3525013 262502 3787515 100 0
Demat Physical Total of TotalShares
Demat Physical Total of TotalShares
ANNEXURE
31
1 Savi Portfolio Management Services LimitedAt the beginning of the year 122218 323Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 122218 323
2 Muktilal Ganulal PaldiwalAt the beginning of the year 82742 218Increase Decrease in Shareholding during the year06042018 220 001 82962 21913042018 250 001 83212 22001062018 927 002 84139 22215062018 700 002 84839 22427072018 412 001 85251 22505102018 1000 003 86251 22830112018 500 001 86751 22931122018 958 003 87709 23218012019 124 000 87833 23208022019 1070 003 88903 23501032019 467 001 89370 23615032019 1000 003 90370 23922032019 200 001 90570 24031032019 50 000 90620 240At the end of the year 90620 240
3 Taradevi Muktilal PaldiwalAt the beginning of the year 31628 084
(ii) Shareholding of Promoters (including Promoter Group)
(iii) Change in Promotersrsquo Shareholding (please specify if there is no change)
SlNo
Shareholders NameNo of
Shares of total
Sharesof the
Company
of Sharespledged
encumbered tototal Shares
No ofShares
of totalShares
of theCompany
of Sharespledged
encumbered tototal Shares
change inShareholding
during the year
1 ITC Limited 1733907 4578 Nil 1733907 4578 Nil Nil
2 Russell Investments Limited 300056 792 Nil 300056 792 Nil Nil
Shareholding at the beginning of the year Shareholding at the end of the year
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
(iv) Shareholding Pattern of top ten Shareholders (other than Directors Promoters and Holders of GDRs and ADRs)
ANNEXURE
No of Shares
Sl No
Particulars Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares of total Shares of the Company
No of Shares of total Shares of the Company
At the beginning of the year
No Change during the year Increase Decrease in Promoters Shareholding during the year
At the end of the year
32
Increase Decrease in Shareholding during the year06042018 180 000 31808 08413042018 53 000 31861 08420042018 1449 004 33310 08827042018 1933 005 35243 09304052018 1060 003 36303 09611052018 2196 006 38499 10218052018 1343 004 39842 10625052018 1191 003 41033 10906072018 1600 004 42633 11313072018 1678 004 44311 11720072018 2095 006 46406 12327072018 3735 010 50141 13303082018 415 001 50556 13410082018 685 002 51241 13624082018 1169 003 52410 13931082018 1616 004 54026 14307092018 1655 004 55681 14714092018 1311 003 56992 15021092018 2480 007 59472 15729092018 2259 006 61731 16305102018 1534 004 63265 16712102018 976 003 64241 17019102018 64 000 64305 17026102018 600 002 64905 17202112018 605 002 65510 17409112018 4 000 65514 17416112018 143 000 65657 17430112018 2299 006 67956 18007122018 515 001 68471 18114122018 10 000 68481 18121122018 590 002 69071 18331122018 600 002 69671 18504012019 1000 003 70671 18825012019 21 000 70692 18801022019 701 002 71393 19008022019 388 001 71781 19115022019 714 002 72495 19301032019 700 002 73195 19515032019 34 000 73229 195At the end of the year 73299 195
4 Shah Viren ShantilalAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 14122018 26965 071
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
ANNEXURE
33
Increase Decrease in Shareholding during theyear ie wef 1412201811012019 28946 076 55911 14701022019 7194 019 63105 166At the end of the year 63105 166
5 Chirayush Pravin VakilAt the beginning of the year 27482 073Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 27482 073
6 Falguni Nilesh DedhiaAt the beginning of the year 18000 048Increase Decrease in Shareholding during the year27042018 5175 014 23175 062At the end of the year 23175 062
7 Classic Realties Private LimitedAt the beginning of the year 23061 061Increase Decrease in Shareholding during the year31082018 100 000 23161 061At the end of the year 23161 061
8 Dheeraj Kumar LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year 0 000 0 000At the end of the year 20000 053
9 Karvy Stock Broking LimitedAt the beginning of the year NA NABecame part of the top ten Shareholders of theCompany with effect from 30112018 23063 061Increase Decrease in Shareholding during theyear ie wef 3011201807122018 149 000 23212 06114122018 (8165) (022) 15047 03931122018 7128 019 22175 05804012019 3087 008 25262 06611012019 (23721) (063) 1541 00331032019 15274 040 16815 043At the end of the year 16815 043 Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company Includes shares acquired during the period when not part of the top ten Shareholders of the Company
10 Sonal LohiaAt the beginning of the year 20000 053Increase Decrease in Shareholding during the year20042018 (1000) (003) 19000 050
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
34
311218 0 000 0 00011012019 0 000 0 00031032019 (5000) (013) 14000 037At the end of the year 14000 037 Ceased to be part of the top ten Shareholders of the Company Became a part of the top ten Shareholders of the Company
11 Rajasthan Global Securities Private LimitedAt the beginning of the year 98659 260Increase Decrease in Shareholding during the year20042018 (4756) (013) 93903 24727042018 (5596) (015) 88307 23206072018 (790) (002) 87517 23027072018 (8520) (022) 78997 20802112018 (10975) (029) 68022 17916112018 (4) 000 68018 17930112018 (6189) (016) 61829 16307122018 (170) 000 61659 16314122018 (18503) (049) 43156 11421122018 (417) (001) 42739 11331122018 (11108) (029) 31631 08404012019 (5000) (013) 26631 07111012019 (5000) (013) 21631 05825012019 (2800) (007) 18831 05101022019 0 000 0 000At the end of the year NA NA Ceased to be a part of the top ten Shareholders of the Company
12 Dinesh Mukilal PaldiwalAt the beginning of the year 10522 028Increase Decrease in Shareholding during the year03082018 112 000 10634 02810082018 424 001 11058 02907092018 500 001 11558 03021092018 85 000 11643 03005102018 1000 003 12643 03302112018 0 000 12643 03301022019 0 000 12643 03315022019 300 001 12943 03431032019 0 000 12943 034At the end of the year NA NA Ceased to be part of the top ten Shareholders of the Company Became part of the top ten Shareholders of the Company
Note Increase decrease in shareholding as indicated above are based on downloads of beneficial ownership provided by the Depositories generally everyFriday
ANNEXURE
SlNo
For each of the top ten Shareholders
No of Shares of total Sharesof the Company
No of Shares of total Sharesof the Company
Shareholding at the beginning ofthe year
Cumulative Shareholding duringthe year
35
(v) Shareholding of Directors and Key Managerial Personnel
ANNEXURE
Ms D R Choudhury Messrs C K Koshy R C Mehta M Narayanan and J Singh Directors Messrs M Agarwal andD K Gulati Key Managerial Personnel did not hold any Shares of the Company either at the beginning or at the end of theyear or at any time during the year
Mr K Pahwa Chief Executive Officer also did not hold any Shares of the Company either at the time of his appointment or atthe end of the year or at any time during the year
V INDEBTEDNESSIndebtedness of the Company including interest outstanding accrued but not due for payment NIL
VI REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNELA Remuneration to Managing Director Wholetime Directors and or Manager NOT APPLICABLE
B Remuneration to the other Directors(Amount in `)
Ceased to be Non-Executive Independent Director with close of work on 31st March 2019
Sl No For each of the Director
Shareholding at the beginning of the year
Cumulative Shareholding during the year
No of Shares held singly
jointly
of total Shares of the
Company
No of Shares held singly
jointly
of total Shares of the
Company
1 N Anand (Chairman)
At the beginning of the year 200 0
Increase Decrease in Shareholding during the year
0 0 0 0
At the end of the year 200 0
Sl No Directors
Particulars of Remuneration
Total Amount Fee for attending Board Board
Committee Meetings
Commission Independent Directors
Meeting Fees 1 Independent Directors
C K Koshy 140000 0 10000 150000 R C Mehta 70000 0 0 70000 M Narayanan 140000 0 10000 150000
Total (B)(1) 350000 0 20000 370000 2 Other Non-Executive Directors
N Anand 0 0 0 0 D R Choudhury 0 0 0 0 J Singh 0 0 0 0
Total (B)(2) 0 0 0 0 Total (B) = (B)(1) + (B)(2) 370000 Total Managerial Remuneration (A+B) 370000
Overall ceiling as per the Act (Being 11 of the Net Profits of the Company as calculated under Section 198 of the Companies Act 2013)
3759620
36
C Remuneration to Key Managerial Personnel other than MD Manager WTD(Amount in `)
Mr K Pahwa was appointed as Chief Executive Officer wef 1st February 2019
VII PENALTIES PUNISHMENT COMPOUNDING OF OFFENCES
against the Company Directors and other Officers in Default under the Companies Act 2013 NONE
On behalf of the Board
Place New Delhi D R Choudhury J SinghDate 15th April 2019 Director Director
ANNEXURE
Sl No
Particulars of Remuneration Key Managerial Personnel
Total Amount
K Pahwa Chief Executive
Officer
M Agarwal Chief Financial
Officer
D K Gulati Company Secretary
1 Gross Salary
(a) Salary as per provisions contained in Section 17(1) of the Income-tax Act 1961
377472 2883242 880140 4140854
(b) Value of perquisites under Section 17(2) of the Income-tax Act 1961
242908 136154 0 379062
(c) Profits in lieu of salary under Section 17(3) of the Income-tax Act 1961
0 0 0 0
2 Stock Option 0 0 0 0 3 Sweat Equity 0 0 0 0 4 Commission
- as of profit - others specify
0 0 0 0
5 Others please specify 0 0 0 0 Total Amount 620380 3019396 880140 4519916
37
Services reverted to ITC Limited effective 17th December 2018 Reflects revision in remuneration effective 1st October 2018
Notes1 The number of permanent employees as on 31st March 2019 was 1982 Compared to 2017-18 the figures for 2018-19 reflect that
i) Median remuneration of employees - Increased by 965ii) Average remuneration of employees excluding Key Managerial Personnel (KMP) - Increased by 1040 with
increase in number of employeesiii) Remuneration of KMP - Increased by 1321 due to revision in remuneration during the year
3 Remuneration of Directors KMP and other employees is in accordance with the Companys Remuneration Policy
A Information pursuant to Section 197 of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014
Name of Directors ampKey ManagerialPersonnel
Designation Ratio of Remuneration toMedian Remuneration of
all employees
Increase inRemuneration over
LY ()
ANNEXURE
N Anand Non-Executive Chairman - -
D R Choudhury Non-Executive Director - -
C K Koshy Independent Director 0731 7
R C Mehta Independent Director 0341 -
M Narayanan Independent Director 0731 7
J Singh Non-Executive Director - -
D Rana Chief Executive Officer 12681 (15)
K Pahwa Chief Executive Officer (wef 1st February 2019) 3111 -
M Agarwal Chief Financial Officer 15281 24
D K Gulati Company Secretary 4371 8
38
O
n de
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verte
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e 17
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The
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)
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)
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)Na
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ited
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ompli
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ajan
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6118
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abar
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INFORMATION US 197 OF THE COMPANIES ACT 2013
39
CEO AND CFO COMPLIANCE CERTIFICATE
We Kunal Pahwa Chief Executive Officer and Mayur Agarwal Chief Financial Officer certify that
a) We have reviewed the financial statements including the cash flow statement for the year ended 31st March 2019 andto the best of our knowledge and belief
i) these statements do not contain any materially untrue statement or omit any material fact or contain statementsthat might be misleading
ii) these statements together present a true and fair view of the Companyrsquos affairs and are in compliance with IndianAccounting Standards applicable laws and regulations
b) To the best of our knowledge and belief no transactions entered into by the Company during the year ended31st March 2019 are fraudulent illegal or violative of the Companyrsquos code of conduct
c) We accept responsibility for establishing and maintaining internal controls for financial reporting and we have evaluatedthe effectiveness of the internal control systems of the Company pertaining to financial reporting Deficiencies in thedesign or operation of such internal controls if any of which we are aware have been disclosed to the auditors and theAudit Committee and steps have been taken to rectify these deficiencies
d) i) There has not been any significant change in internal control over financial reporting during the year underreference
ii) The changes in the Significant Accounting Policies arising from the adoption of the Indian Accounting Standardshave been discussed with the auditors and have been approved by the Audit Committee and
iii) We are not aware of any instance during the year of significant fraud with involvement therein of the managementor any employee having a significant role in the Companyrsquos internal control system over financial reporting
Place New Delhi Kunal Pahwa Mayur AgarwalDate 15th April 2019 Chief Executive Officer Chief Financial Officer
40
BALANCE SHEET
As at 31st March 2019Amount in `
Particulars Note As at As at31st March 2019 31st March 2018
ASSETSNon-Current Assetsa) Property Plant and Equipment 2 14695652 15623727b) Other Non-Current Assets 3 6672434 7609451Total Non-Current Assets 21368086 23233178Current Assetsa) Financial Assets
(i) Investments 4 280294894 208482957(ii) Trade Receivables 5 16310661 14154244(iii) Cash and Cash Equivalents 6 763039 900355(iv) Other Bank Balances 7 5489856 53182631(v) Other Financial Assets 8 4724316 6349124
b) Other Current Assets 3 437564 406324Total Current Assets 308020330 283475635Total Assets 329388416 306708813EQUITY AND LIABILITIESEquitya) Equity Share Capital 9 37875150 37875150b) Other Equity 268275037 243468594Total Equity 306150187 281343744LIABILITIESNon-Current Liabilitiesa) Provisions 10 1399224 1270990b) Deferred Tax Liabilities (Net) 11 10745247 11364002Total Non-Current Liabilities 12144471 12634992Current Liabilitiesa) Financial Liabilities
(i) Trade Payablesa) Total outstanding dues of micro enterprises and
small enterprises ndash ndashb) Total outstanding dues of creditors other than
micro enterprises and small enterprises 483074 395920(ii) Other Financial Liabilities 12 9272344 11118126
b) Other Current Liabilities 13 1264039 1172866c) Provisions 10 74301 43165Total Current Liabilities 11093758 12730077Total Equity And Liabilities 329388416 306708813
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
41
STATEMENT OF PROFIT AND LOSS
For the year ended 31st March 2019Amount in `
I Revenue From Operations 14 36986948 33098499
II Other Income 15 19625544 17119109
III Total Income (I+II) 56612492 50217608
IV EXPENSES
Employee Benefits Expense 16 1208580 1094609
Depreciation and Amortization Expense 473636 475984
Other Expenses 17 3107913 3334087
Total Expenses (IV) 4790129 4904680
V Profit Before Tax (III- IV) 51822363 45312928
VI Tax Expense
Current Tax 18 11653499 9272310
Deferred Tax 18 (618755) 2350502
VII Profit for the Year (V-VI) 40787619 33690116
VIII Other Comprehensive Income ndash ndash
IX Total Comprehensive Income for the Year (VII+VIII) 40787619 33690116
X Earnings per Equity Share (Face Value ` 10-each) 19
Basic (in `) 1077 890
Diluted (in `) 1077 890
For the Year For the YearParticulars Note ended ended
31st March 2019 31st March 2018
The accompanying notes 1 to 22 are an integral part of the Financial StatementsIn terms of our report of even date
On behalf of the BoardFor K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
42
For the year ended 31st March 2019
STATEMENT OF CHANGES IN EQUITY
The Board of Directors of the Company recommended a dividend of ` 35 per share (for the year ended 31st March 2018 - dividend ` 350 pershare) be paid on fully paid equity shares This equity dividend is subject to approval by shareholders at the Annual General MeetingThe totalequity dividend to be paid ` 13256303 (for the year ended 31st March 2018 - dividend ` 13256303) Income tax on proposed dividend being` 2724873 (for the year ended 31st March 2018 - ` 2724873)
General Reserve This Reserve is created by an appropriation from one component of equity (generally retained earnings) to another notbeing an item of Other Comprehensive Income The same can be utilized by the Company in accordance with the provisions of the CompaniesAct 2013
Retained Earnings This Reserve represents the cumulative profits of the Company This Reserve can be utilized in accordance with theprovisions of the Companies Act 2013
The accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even dateOn behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
A Equity Share CapitalAmount in `
Balance as at the Changes in equity Balance at thebeginning of the share capital end of the
reporting year during the year reporting yearFor the year ended 31st March 2018 37875150 ndash 37875150For the year ended 31st March 2019 37875150 ndash 37875150
B Other EquityAmount in `
Reserves amp Surplus TotalGeneral Reserve Retained Earnings
Balance as at April 01 2017 30257504 195873461 226130965Total Comprehensive Income for the year ndash 33690116 33690116Dividend ndash 13256303 13256303Income Tax on Dividend Paid ndash 2698671 2698671Dividend Distribution Tax (earlier year) ndash 397513 397513Balance as at March 31 2018 30257504 213211090 243468594Balance as at April 01 2018 30257504 213211090 243468594Total Comprehensive Income for the year ndash 40787619 40787619Dividend ndash 13256303 13256303Income Tax on Dividend Paid 2724873 2724873Balance as at March 31 2019 30257504 238017533 268275037
43
CASH FLOW STATEMENT
For the year ended 31st March 2019
For the Year For the YearParticulars ended ended
31st March 2019 31st March 2018
NOTES1) The above Cash Flow Statement has been prepared under the ldquoIndirect Methodrdquo as set out in Ind AS 7Statement of Cash FlowsrdquoThe accompanying notes 1 to 22 are an integral part of the Financial Statements
In terms of our report of even date On behalf of the Board
For K C Mehta amp CoChartered AccountantsFirms Registration No 106237W
Vishal P Doshi D R Choudhury J SinghPartner Director DirectorMNo 101533
Place New Delhi K Pahwa M Agarwal D K GulatiDate 15th April 2019 Chief Executive Officer Chief Financial Officer Company Secretary
Amount in `
A Cash Flow from Operating ActivitiesPROFIT BEFORE TAX 51822363 45312928Adjustments for
Depreciation amp Amortisation expense 473636 475984Interest Income (1317822) (3453950)Dividend Income (159984) (178075)Loss on sale of property plant and equipment - Net 445778 (28273)Net gain(loss) on investments mandatorily measuredat fair value through profit or loss (18005340) (13358789)Other Non Operating Income ndash (86856)Other Non Operating Expense ndash 99378
OPERATING PROFIT BEFORE WORKING CAPITAL CHANGES 33258631 28782347Adjustments for
Trade Receivables Financial Assets and Other Assets (2815198) (90661)Trade Payables Other Liabilities and Provisions (1568800) 1700052
CASH GENERATED FROM OPERATIONS 28874633 30391738Income Tax Paid(Net) (10407981) (12740273)
NET CASH FROM OPERATING ACTIVITIES 18466652 17651465B Cash Flow from Investing Activities
Sale of Property Plant and Equipment 8661 58452Purchase of Current Investments (224340000) (186220000)SaleRedemption of Current Investments 170532754 183295529Dividend Income 159984 178075Interest Received 3262318 4031382
NET CASH FROM INVESTING ACTIVITIES (50376283) 1343438C Cash Flow from Financing Activities
Dividend Paid (13256303) (13256303)Income Tax on Dividend Paid (2724873) (2698671)
NET CASH FROM FINANCING ACTIVITIES (15981176) (15954974)NET INCREASE IN CASH AND CASH EQUIVALENTS (47890807) 3039929OPENING CASH AND CASH EQUIVALENTS 48653846 45613917CLOSING CASH AND CASH EQUIVALENTS 763039 48653846
CASH AND CASH EQUIVALENTS COMPRISE Cash cheques and current accounts 763039 900355Other Bank BalancesDeposits with original maturity more than 3 months having remainingmaturity less than 12 months from Balance Sheet date ndash 47753491
763039 48653846
44
1 SIGNIFICANT ACCOUNTING POLICIESStatement of ComplianceThese financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) notifiedunder section 133 of the Companies Act 2013 (the Act) read with Companies (Indian Accounting Standards)Rules 2015 (as amended) The financial statements have also been prepared in accordance with the relevantpresentation requirements of the Companies Act 2013
Basis of PreparationThe financial statements are prepared in accordance with the historical cost convention except for certain itemsthat are measured at fair values as explained in the accounting policies below The financial statements arepresented in Indian Rupees (INR) which is also the Companyrsquos functional currency
Fair Value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transactionbetween market participants at the measurement date regardless of whether that price is directly observable orestimated using another valuation technique In estimating the fair value of an asset or a liability the Companytakes into account the characteristics of the asset or liability if market participants would take those characteristicsinto account when pricing the asset or liability at the measurement date
The preparation of financial statements in conformity with Ind AS requires management to make judgementsestimates and assumptions that affect the application of the accounting policies and the reported amounts ofassets and liabilities the disclosure of contingent assets and liabilities at the date of the financial statementsand the reported amounts of revenues and expenses during the year Actual results could differ from those estimatesThe estimates and underlying assumptions are reviewed on an ongoing basis Revisions to accounting estimatesare recognised in the period in which the estimate is revised if the revision affects only that period they arerecognised in the period of the revision and future periods if the revision affects both current and future periods
All assets and liabilities have been classified as current or non-current as per the Companyrsquos normal operatingcycle and other criteria set out in the Schedule III to the Companies Act 2013 and Ind AS 1 ndash Presentation ofFinancial Statements based on the nature of business and the time between the acquisition of assets for processingand their realisation in cash and cash equivalents
Property Plant amp Equipment ndash Tangible AssetsProperty plant amp equipment are stated at cost of acquisition or construction less accumulated depreciation andimpairment if any For this purpose cost includes deemed cost which represents the carrying value of propertyplant and equipment recognised as at 1st April 2015 measured as per the previous GAAP
Cost is inclusive of inward freight duties and taxes and incidental expenses related to acquisition In respect ofmajor projects involving construction related pre-operational expenses form part of the value of assets capitalisedExpenses capitalised also include applicable borrowing costs for qualifying assets if any Subsequent costs areincluded in the assetrsquos carrying amount only when it meets the recognition criteria are met as per componentaccounting The carrying amount of a replaced part is derecognized All other repairs and maintenance are chargedto the statement of Profit amp Loss
An item of property plant and equipment is derecognized upon disposal or when no future economic benefits areexpected to arise from the continued use of asset Any gain or loss arising on the disposal or retirement of an itemof property plant and equipment is determined as the difference between the sales proceeds and the carryingamount of the asset and is recognised in Statement of Profit and Loss
Depreciation of these assets commences when the assets are ready for their intended use which is generally oncommissioning Items of Property Plant and Equipment are depreciated in a manner that depreciates the cost ofthe assets after commissioning (or other amount substituted for cost) less its residual value over their usefullives as specified in Schedule II of the Companies Act 2013 on a straight line basis
Property plant and equipmentrsquosrsquo residual values and useful lives are reviewed at each balance sheet date andchanges if any are treated as changes in accounting estimate
NOTES TO THE FINANCIAL STATEMENTS
45
NOTES TO THE FINANCIAL STATEMENTS
Useful lives of different class of PPE are as follows
Particulars Useful Life as per Schedule IIBuilding 60 Years
Plant and Equipment 15 Years
Furnitures and fixtures 8 years
Office equipment 5 Years
Impairment of AssetsImpairment loss is provided if any to the extent the carrying amount of assets or cash generating units exceedtheir recoverable amount
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amountmay not be recoverable
Recoverable amount is higher of an assetrsquos net selling price and its value in use Value in use is the present valueof estimated future cash flows expected to arise from the continuing use of an asset or cash generating unit andfrom its disposal at the end of its useful life
Impairment losses recognised in prior years are reversed when there is an indication that the impairment lossesrecognised no longer exist or have decreased Such reversals are recognised as an increase in carrying amountsof assets to the extent that it does not exceed the carrying amounts that would have been determined (net ofamortisation or depreciation) had no impairment loss been recognised in previous years
Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodiedin the asset are considered to modify the amortisation period or method as appropriate and are treated aschanges in accounting estimates
Financial instruments Financial Assets and Financial LiabilitiesFinancial assets and financial liabilities are recognized when the Company becomes a party to the contractualprovisions of the relevant instrument Transaction cost that are directly attributable to the acquisition or issue offinancial assets and financial liabilities (other than financial assets and financial liabilities measured at fair valuethrough profit or loss) are added to or deducted from the fair value on initial recognition of financial assets andfinancial liabilities Purchase or sale of financial assets that require delivery of assets within a time frame establishedby regulation or convention in the market place (regular way trades) are recognized on the trade date ie the datewhen the Company commits to purchase or sell the asset
Financial AssetsRecognition Financial assets includes Investments Trade receivable Advances Security Deposits Cash andcash equivalents Such Assets are initially recognized at transaction price when the company becomes party tocontractual obligations The transaction price includes transaction cost unless the assets is being fair valuedthrough the Statement of Profit and Loss
Classification Management determines the classification of an asset at initial recognition depending on thepurpose for which the assets were acquired The subsequent measurement of financial assets depends on suchclassification
Financial assets are classified as those measured at
(a) Amortised cost where the financial assets are held solely for collection of cash flows arising from payments ofprincipal and or interest
(b) Fair value through other comprehensive income (FVTOCI) where the financial assets are held not only forcollection of cash flows arising from payments of principal and interest but also from the sale of such assetsSuch assets are subsequently measured at fair value with unrealised gains and losses arising from changesin the fair value being recognised in other comprehensive income
46
NOTES TO THE FINANCIAL STATEMENTS
(c) Fair value through profit or loss (FVTPL) where the assets are managed in accordance with an approvedinvestment strategy that triggers purchase and sale decision based on fair value of such assets Such assetsare subsequently measured at fair value with unrealized gain and losses arising from changes in the fair valuebeing recognised in the Statement of Profit and Loss in the period in which they arise
Trade receivable Advances Security Deposits Cash and Cash equivalents etc are classified for measurementat amortised cost while Investment have been classified for measurement at Fair value through profit or loss(FVTPL)
Impairment The Company assesses at each reporting date whether a financial asset (or group of financialassets) such as investment trade receivable advances and security deposit held at amortised cost are tested forimpairment based on evidence or information that is available without undue cost or effort Expected credit lossesare assessed and loss allowances recognized if the credit quality of the financial asset has deteriorated significantlysince initial recognition
Reclassification When and only when the business model is changed the Company shall reclassify all affectedfinancial assets prospectively from the reclassification date as subsequently measured at amortised cost fairvalue through profit or loss without restating the previously recognized gains or losses and in terms of thereclassification principles laid down in the Ind AS relating to Financial Instruments
De-recognition Financial assets are derecognized when the rights to receive benefits have expired or beentransferred and the Company has transferred substantially all risks and rewards of ownership of such financialasset
Financial LiabilitiesTrade payables and other financial liabilities are initially recognized at the value of the respective contractualobligations They are subsequently measured at amortised cost
Financial liabilities are derecognized when the liability is extinguished that is when the contractual obligation isdischarged cancelled or expires
Offsetting Financial InstrumentsFinancial assets and liabilities are offset and the net amount is included in the Balance Sheet where there is alegally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis orrealise the asset and settle the liability simultaneously
Revenue1 Revenue is measured at the fair value of the consideration received or receivable for services rendered net of
discounts to customers and excludes taxes such as Goods and Services Tax Revenue from the sale ofservices is recognised when the Company performs its obligations to its customers and the amount of revenuecan be measured reliably and recovery of the consideration is probable Income from operating license fees arerecognized on accrual basis in accordance with Operating License agreement The timing of such revenuerecognition is in the periods in which such services are rendered
2 Interest Income is booked in the Statement of Profit and Loss using the effective interest method
3 Dividend Income is recognised in the Statement of Profit and Loss when the right to receive dividend is established
Employee BenefitsThe Company makes contributions to both defined benefit and defined contribution schemes
Contributions to Provident Fund are in the nature of defined contribution scheme and such paidpayable amountsare charged against revenue The contributions in respect of provident fund and family pension are statutorilydeposited with the Government
The Company also makes contribution to defined benefit gratuity plan The cost of providing benefits under thedefined benefit obligation is calculated by independent actuary using the projected unit credit method The Companyhas taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liability with respect to the
47
NOTES TO THE FINANCIAL STATEMENTS
employees and the premium paid to LIC is charged to Statement of Profit amp Loss The difference between theactuarial valuation of the gratuity with respect to employees at the year-end and the contribution paid to LIC isfurther adjusted in the books of accounts
Employees Benefit wrt Leave Encashment is considered as Employees Long Term Benefit for which the Companyrecords the liability based on actuarial valuation computed under projected unit credit method These benefits areunfunded
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee as per the Operating LicenseAgreement
Taxes on IncomeTaxes on income comprises of current tax and deferred tax Current tax in the Statement of Profit and Loss isprovided as the amount of tax payable in respect of taxable income for the period using tax rates and tax lawsenacted during the period together with any adjustment to tax payable in respect of previous years
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities andthe amounts used for taxation purposes (tax base) at the tax rates and tax laws enacted or substantively enactedby the end of the reporting period
Deferred tax assets are recognized for the future tax consequences to the extent it is probable that future taxableprofits will be available against which the deductible temporary differences can be utilized
Deferred tax assets and liabilities are offset when there is legally enforceable right to offset current tax assets andliabilities and when the deferred tax balances relate to the same taxation authority Current tax assets and taxliabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on netbasis or to realize the asset and settle the liability simultaneously
Dividend DistributionDividends paid (including income tax thereon) is recognised in the financial statements in the period in which inwhich the interim dividends are approved by the Board of Directors or in respect of the Companyrsquos final dividendfor the year when the same are approved by shareholders of the Company
Provisions and Contingent LiabilitiesProvisions are recognized when the Company has a present obligation (legal or constructive) as a result of a pastevent it is probable that an outflow of resources will be required to settle the obligation and the amount can bereliably estimated The amount so recognized is the best estimate of the consideration required to settle theobligation at the reporting date taking in to account the risks and uncertainties surrounding the obligation Adisclosure for a contingent liability is made when there is possible obligation or a present obligation that may butprobably will not require an outflow of resources Where there is possible obligation or a present obligation inrespect of which the likelihood of outflow of resources is remote no provision or disclosure is made
Use of Estimates and JudgementsThe key estimates and assumption used in the preparation of financial statements are set out below
Actuarial ValuationThe determination of Companyrsquos liability towards defined benefit obligation to employees is made through independentactuarial valuation including determination of amounts to be recognized in the Statement of Profit and Loss and inother comprehensive income Such valuation depend upon assumptions determined after taking into accountinflation seniority promotion and other relevant factors such as supply and demand factors in the employmentmarket Information about such valuation is provided in notes to the financial statements
ComparativesWhen required by Ind AS comparative figures have been adjusted to conform to changes in presentation for thecurrent financial year
48
2P
rope
rty
Pla
nt a
nd E
quip
men
tA
mou
nt i
n `
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
Gros
s Bl
ock
Depr
eciat
on
Amor
tisati
onNe
t Blo
ck
Parti
cula
rsWi
thdraw
alWi
thdraw
alWi
thdraw
alWi
thdraw
alAp
ril 1
and
Marc
h 31
an
dMa
rch
31
April
1Fo
r the
and
March
31
For t
hean
dMa
rch
31
Marc
h 31
Ma
rch
31
2017
Addi
tions
Adjus
tmen
t20
18Ad
ditio
nsAd
justm
ent
2019
2017
year
Adjus
tmen
t20
18ye
arAd
justm
ent
2019
2019
2018
Tang
ible
Ass
ets
Build
ing
161
88
565
-16
188
565
-2
668
831
592
168
29
561
564
759
84-1
432
140
473
636
290
5518
76
721
140
44
961
147
56
425
Plan
t and
Equ
ipmen
t7
637
0120
716
742
985
-2
047
935
381
92-
--
--
--
538
192
742
985
Furn
iture
and
Fixt
ures
1
278
845
584
122
300
-11
818
110
482
--
--
--
-1
104
821
223
00
Offic
e Eq
uipme
nt2
017
-2
017
--
201
7-
--
--
--
201
72
017
Tota
l1
708
216
7-
263
001
705
586
7-
483
494
165
72
373
956
156
475
984
-14
321
404
736
3629
055
187
672
11
469
565
21
562
372
7
Full
y de
prec
iated
ass
ets
NO
TES
TO
TH
E F
INA
NC
IAL
STA
TEM
EN
TS
49
NOTES TO THE FINANCIAL STATEMENTS
Amount in `Particulars As at 31st March 2019 As at 31st March 2018
Current Non-Current Current Non-Current3 OTHER ASSETS
Advances other than capital advancesSecurity Deposit- With Others 2328947 2328947- Statutory Authorities 200000Other Advances (prepaid expenses) 437564 ndash 406324 ndashAdvance Tax (Net of Provisions) 4143487 5280504TOTAL 437564 6672434 406324 7609451
4 Current investments (at fair value through profit or loss unless otherwise stated) Amount in `Sl Investments in Mutual Funds As at 31st March 2019 As at 31st March 2018No
Name of Plan Unquoted Unquoted1 DHFL Pramerica Ultra Short Term Fund Nil (2018 - 1040731248)
Units of ` 1000 each ndash 219455882 ICICI Prudential Banking amp PSU Debt Fund 1124750948 Units
(2018 - 1124750948) of ` 1000 each 23872614 224702743 ICICI Prudential Corporate Bond Fund 1241451718 Units
(2018 - 1241451718) of ` 1000 each 23712100 221226704 UTI Floating Rate Fund Short Term Fund 7749911 Units
(2018-7749911) of ` 100000 each 23474167 218899535 SBI Magnum Instacash Nil Units (2018-3177849) of ` 100000 each ndash 70220186 Aditya Birla Sun Life Floating Rate Fund-Long Term 274475933 Units
(2018-319824542) Units of ` 10000 each 63614941 686675207 Aditya Birla Sunlife Saving Fund 137924934 Units (2018-129174683)
Units of ` 10000 each 51171946 443649348 Kotak Savings Fund 1128273230 Units (2018-Nil) of ` 1000 each 33816154 ndash9 Reliance Liquid Fund 11416769 Units (2018- Nil) of ` 100000 each 51823115 ndash10 ICICI Prudential Liquid Fund 57413509 Units (2018- Nil) of ` 10000 each 8809857 ndash
Aggregate amount of unquoted Investments 280294894 208482957TOTAL 280294894 208482957
Amount in `As at As at
31st March 2019 31st March 20185 TRADE RECEIVABLES
Unsecured Considered Good 16310661 14154244TOTAL 16310661 14154244
6 CASH AND CASH EQUIVALENTS Balances with Banks
Current Accounts 760024 900355Cash on Hand 3015 ndashTOTAL 763039 900355 Cash and cash equivalents include cash on hand cheques drafts on hand cash at bank and deposits with banks with original maturityof 3 months or less
7 OTHER BANKS BALANCESEarmarked balances 5489856 5429140On Deposit Accounts ndash 47753491TOTAL 5489856 53182631
Represents deposits with original maturity of more than 3 months having remaining maturity of less than 12 months from the Balance Sheet date
50
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
8 OTHER FINANCIAL ASSETSInterest accrued on Deposits 158000 2210348Others - Unsecured considered good 4566316 4138776TOTAL 4724316 6349124
As at As at As at As at31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of ` (No of `
Shares) Shares)9 EQUITY SHARE CAPITAL
AuthorisedEquity Shares of ` 10- each 10000000 100000000 10000000 100000000Issued Subscribed and Paid upEquity Shares of ` 10- each fully paid 3787515 37875150 3787515 37875150
A) Reconciliation of the number of Equity Shares outstanding31st March 31st March
2019 2018As at the beginning of the year 3787515 3787515Add - Shares issued during the year ndash ndashLess -Shares bought back during the year ndash ndashAs at the end of the year 3787515 3787515
B) Shareholders holding more than 5 of the As at As at As at As atEquity Shares in the Company 31st March 31st March 31st March 31st March
2019 2019 2018 2018(No of (No of
Shares) Shares)ITC Limited 1733907 4578 1733907 4578Russell Investments Limited 300056 792 300056 792
C) Rights Preferences and Restrictions attached to the Equity SharesThe Equity Shares of the Company having par value of ` 10 per share rank pari passu in all respects includingvoting rights and entitlement to dividend
D) There are no bonus issue or buy back of equity shares during the period of five years immediately preceding thereporting date
As at 31st March 2019 As at 31st March 2018Current Non-Current Current Non-Current
10 PROVISIONSProvision for Long Term Employee Benefits 74301 1399224 43165 1270990TOTAL 74301 1399224 43165 1270990
51
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars As at As at31st March 2019 31st March 2018
11 DEFERRED TAX LIABILITIES (NET)Deferred Tax Liabilities 10745247 11364002Total 10745247 11364002Movement in Deferred Tax LiabilitiesAssets Balances
For the year 2018-19 Balance as on Recognized in Balance as on1st April 2018 profit or loss 31st March 2019
Deferred Tax Liabilities in relation toOther timing differences
On Depreciation on PPE 4293876 (252926) 4040950On Gain on Investment at FVTPL 7070126 473819 7543945
Total Deferred Tax Liabilities 11364002 220893 11584895Deferred tax liabilities beforeMAT credit entitlement 11364002 220893 11584895Less MAT credit entitlement ndash 839648 839648Total Deferred Tax Liabilities (Net) 11364002 (618755) 10745247
For the year 2017-18 Balance as on Recognized in Balance as on1st April 2017 profit or loss 31st March 2018
Deferred Tax liabilitiesassets in relation toOther timing differences
On Depreciation on PPE 4383618 (89742) 4293876On Gain on Investment at FVTPL 4629882 2440244 7070126
Total Deferred Tax Liabilities (Net) 9013500 2350502 11364002
As at As at31st March 2019 31st March 2018
12 OTHER FINANCIAL LIABILITIES
Unpaid Dividend 5489856 5429140Employee Related 3782488 5688986TOTAL 9272344 11118126
13 OTHER CURRENT LIABILITIES
Statutory Liabilities 1264039 1172866TOTAL 1264039 1172866
52
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 201814 REVENUE FROM OPERATIONS
Operating License Fees 36986948 33098499TOTAL 36986948 33098499
15 OTHER INCOMEInterest Income- Deposit with Banks- Carried At Amortised Cost 1178600 3272160- Deposit Others 139222 181790Dividend Income on Investment measured at FVTPL 159984 178075Net Gain(Loss) on financial assets mandatorily measured at FVTPL 18005340 13358789Net Gain(Loss) on Disposal of Fixed Assets ndash 28273Other Non-Operating Income 142398 100022TOTAL 19625544 17119109
Includes 1120976- (2018 - 681882-) being net gain(loss) on sale of investments
16 EMPLOYEE BENEFITS EXPENSESalaries and Wages 42461991 38590070Contribution to Provident and Other Fund 4564892 3983444
47026883 42573514Less Recoveries madeReimbursements received (45818303) (41478905)TOTAL 1208580 1094609
17 OTHER EXPENSESAdvertising Sales Promotion 159768 158814Consultancy Professional fees 214842 253969Travelling amp Conveyance 810746 1096527Postage Telephone Stationery etc 366042 205049Miscellaneous Expenses 1556515 1619728TOTAL 3107913 3334087Miscellaneous expenses includes Auditors remuneration andexpenses Audit Fees 60000 60000Fees for other services 40000 ndash
18 INCOME TAX EXPENSESA Amount recognised in profit or loss
Current TaxIncome Tax for the Year 11504441 9481109Adjustments(Credits) related to previous year 149058 (208799)Total Current Tax 11653499 9272310Deferred TaxDeferred tax for the year 220893 2350502Mat Credit Entitlement (839648) ndashTotal Deferred Tax (618755) 2350502TOTAL 11034744 11622812
NOTES TO THE FINANCIAL STATEMENTSAmount in `
53
NOTES TO THE FINANCIAL STATEMENTSAmount in `
Particulars For the Year For the Yearended 31st ended 31st
March 2019 March 2018B Reconciliation of effective tax rate
Profit before tax 51822363 45312928Indian tax rate 2782 2755Income Tax expense calculated at 2782 (2018 2755) 14416981 12484845Effects ofndash Different tax rate on certain items (2922098) (756048)ndash Difference in taxable incomedeductible expense 9697 42609ndash Incomes that are not taxable in determining taxable profit (44508) (49064)Adjustments recognised in the current year in relation toCurrent tax of prior years (425328) (208799)Effect on deferred tax balances due to the change in income tax rate ndash 109269Income Tax recognised in profit or loss 11034744 11622812
The tax rate used for the year 2018-19 and 2017-18 reconciliations above is the corporate tax rate of 25 + surcharge 7 and education cess 4 (2017-18 3) payable on taxable profits under the Income Tax Act 1961
19 EARNINGS PER EQUITY SHAREProfit for the year 40787619 33690116Number of equity shares outstanding 3787515 3787515Basic and diluted earnings per share in (Face value ` 10- per share) 1077 890
20 ADDITIONAL NOTES TO THE FINANCIAL STATEMENTSA The Company was allotted 8200 sq mtrs of land at Vadodara in 1984 and an additional land of 2548 sq mtrs
in 1988 at R C Dutt Road Alkapuri Vadodara through GIIC (Gujarat Industrial Investment Corporation) on sub-lease for a period 30 years on which the hotel Welcomhotel Vadodara was constructed Lease term of landadmeasuring 8200 Sq mtrs expired on 30092014 and of land admeasuring 2548 sq mtrs expired on 30112018
The High Court of Gujarat in pursuance of Writ petition filed by Company in April 2013 passed an Order onDecember 24 2014 restraining the State Government from disturbing the peaceful and actual possession ofthe Company over the hotel property in any manner The writ petition is pending for hearing
The Company have made necessary application to State Government for Conversion of land from Leasehold toFreehold or Extension of Lease which is in process
B There are no Micro Small and Medium Enterprises to whom the Company owes dues which are outstandingfor more than 45 days during the year and also as at 31st March 2019 This information as required to bedisclosed under the Micro Small and Medium Enterprises Development Act 2006 has been determined tothe extent such parties have been identified on the basis of information available with the Company
C The Company operates in one segment ie Hoteliering and within one geographical segment ie India
D Defined Benefit Plan
The Company has taken a Policy with Life Insurance Corporation of India (LIC) to cover the gratuity liabilitywith respect to the employees and the premium paid to LIC is charged to Statement of Profit amp Loss Thedifference between the actuarial valuation of the gratuity with respect to employees at the year-end and thecontribution paid to LIC is further adjusted in the books of accounts
The accounting charge for benefits under the defined benefit obligation is calculated by independent actuaryusing the projected unit credit method
All such Employee Benefit expenditureprovisions are reimbursed by the Licensee (ITC Limited) as per theOperating License Agreement hence no effect on Statement of Profit amp Loss and Other Comprehensive
54
NOTES TO THE FINANCIAL STATEMENTS
Income
Risk ManagementThe defined Benefit Plan expose the company to risk of actuarial deficit arising out of investment risk interestrate risk and salary cost inflation riskInvestment Risks This may arise from volatility in asset values due to market fluctuations and impairment ofassets due to credit losses These Plans primarily invest in debt instruments such as Government securitiesand highly rated corporate bonds ndash the valuation of which is inversely proportional to the interest rate movementsInterest Rate Risk The present value of Defined Benefit Plans liability is determined using the discount ratebased on the market yields prevailing at the end of reporting period on Government bonds A decrease inyields will increase the fund liabilities and vice-versaSalary Cost Inflation Risk The present value of the Defined Benefit Plan liability is calculated with referenceto the future salaries of participants under the Plan Increase in salary due to adverse inflationary pressuresmight lead to higher liabilitiesThese Plans have a relatively balanced mix of investments in order to manage the above risks The investmentstrategy is designed based on the interest rate scenario liquidity needs of the Plans and pattern of investmentas prescribed under various statutes
(Amount in `) Particulars Gratuity 2018-19 2017-18
I Components of Defined Benefit Cost 31-03-2019 31-03-2018 Recognised in Profit or Loss a Current Service Cost 641829 519816 b Past Service Cost ndash
c Net Interest Cost (184109) (72060) Remeasurements a Effect of changes in demographic assumptions (2108) ndash b Effect of changes in financial assumptions ndash (546692) c Effect of experience adjustments (142950) (700483) d (Return) on plan assets (excluding interest income) 24103 110903 e Changes in asset ceiling (excluding interest income) ndash ndash f Total remeasurements included in OCI (169160) (1358078)
Total defined benefit cost recognized in PampL 288560 (910323)I I Net Assets (Liabilities) recognised in Balance Sheet 31-03-2019 31-03-2018
1 Defined Benefit Obligation at end of period 11112243 102978642 Fair value of plan assets at end of period 13058222 120087733 Net defined benefit liability (asset) (1945979) (1710909)
III Change in Defined Benefit Obligation 31-03-2019 31-03-20181 Defined benefit obligation at beginning of period 10297864 111006822 Current service cost 641829 5198163 Interest expenses 755904 7223694 Remeasurements gains (losses)
a Effect of changes in demographic assumptions (2108) ndashb Effect of changes in financial assumptions ndash (546692)c Effect of experience adjustments (142950) (700483)
5 Benefits Paid (438296) (797828)6 Present Value of DBO at end of the year 11112243 10297864
IV Change in Fair Value of Plan Assets 31-03-2019 31-03-20181 Fair value of plan assets at beginning of period 12008773 11529880
55
NOTES TO THE FINANCIAL STATEMENTS
2 Interest income 940012 7944303 Actual Company Contributions 523630 3713884 Benefits Paid (438296) (797828)5 Remeasurements Gains(Losses) on plan assets 24103 1109036 Fair Value of Plan Assets at end of period 13058222 12008773
V Significant Actuarial Assumptions 31-03-2019 31-03-20181 Discount rate () 750 7502 Salary increase rate 70 703 Attrition Rate 20 204 Retirement Age 58 585 Pre-retirement Mortality Indian Assured Indian Assured
Lives Mortality Lives Mortality(2012-14) Ultimate (2006-08) Ultimate
6 Disability Nil NilVI Sensitivity Analysis
The below sensitivity analysis are based on a change in an assumption while holding all other assumptionsconstant In practice this is unlikely to occur and changes in some of the assumptions may be correlatedWhen calculating the sensitivity of the defined benefit obligation to significant actuarial assumptionsthe same method (present value of the defined benefit obligation calculated with the projected unit creditmethod at the end of the reporting period) has been applied as when calculating the defined benefitliability recognised in the balance sheet The methods and types of assumptions used in preparing thesensitivity analysis did not change compared to the prior period
DBO as at DBO as at31-03-2019 31-03-2018
1 Discount rate +100 basis points 10484869 96707062 Discount rate -100 basis points 11804923 109908143 Salary Increase Rate +1 11746789 109364544 Salary Increase Rate -1 10525722 97077345 Attrition Rate +1 11127835 103179616 Attrition Rate -1 11095064 10276102
Maturity Analysis of the Benefit Payments 31-03-2019 31-03-2018 Year 1 804294 399061 Year 2 1117591 769443 Year 3 558914 1211853 Year 4 2204073 512504 Year 5 1303903 2056016 Next 5 years 4323660 4603103
E Amount towards Defined Contribution Plans have been recognized under Contribution to Provident and OtherFunds in Note 16 ` 4564892- (2018 - ` 3983444-)
F The financial statements were approved for issue by the Board of Directors on 15th April 2019G Company has adopted IND As 115 lsquoRevenue from Contracts with Customersrsquo wef 01st April 2018 on prospective
basis and there is no material impact on Financial StatementsH Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Second
Amendment Rules 2019 on 30th March 2019 notifying new Standard Ind AS 116 lsquoLeasesrsquo and otherconsequential amendment in existing Ind As This Ind AS is applicable for annual period beginning on or after01st April 2019 The company is in the process of analysing the impact of such amendment which are notexpected to be material
56
NOTES TO THE FINANCIAL STATEMENTS
21 Financial Instruments and Related DisclosuresI Capital Management
The Company does not have borrowing and aims at maintaining a strong capital base so as to maintain adequatesupply of funds towards future growth plans as a going concern
II Categories of Financial InstrumentsAmount in `
Particulars Note As at As at March 31 2019 March 31 2018
Carrying Fair Carrying FairValue Value Value Value
A Financial Assetsa) Measured at Amortised Cost
i) Cash and cash equivalents 6 763039 763039 900355 900355ii) Other bank balances 7 5489856 5489856 53182631 53182631iii) Trade Receivables 5 16310661 16310661 14154244 14154244iv) Other Financial Assets 8 4724316 4724316 6349124 6349124
Sub - total 27287872 27287872 74586354 74586354 b) Measured at Fair Value through Profit or Loss
i) Investment in mutual funds 4 280294894 280294894 208482957 208482957Sub - total 280294894 280294894 208482957 208482957
Total Financial Assets 307582766 307582766 283069311 283069311B Financial Liabilities
Measured at Amortised Costi) Trade Payables 483074 483074 395920 395920ii) Other Financial Liabilities 12 9272344 9272344 11118126 11118126Total Financial Liabilities 9755418 9755418 11514046 11514046
The carrying amounts of trade payables other financial liabilities cash and cash equivalents other bank balancestrade receivables and other financial assets are considered to be the same as their fair values due to their short termnatureFair value in Mutual fund has been considered as Level 1 as Hierarchy for the same are based on unadjusted pricesin active marketIII Financial Risk Management Objectives
The Company has a system-based approach to risk management anchored to policies and procedures andinternal financial controls aimed at ensuring early identification evaluation and management of key financialrisks (such as market risk credit risk and liquidity risk) that may arise as a consequence of its businessoperations as well as its investing activities Accordingly the Companyrsquos risk management framework has theobjective of ensuring that such risks are managed within acceptable and approved risk parameters in a disciplinedand consistent manner and in compliance with applicable regulation It also seeks to drive accountability in thisregardLiquidity RiskThe company has current assets aggregate to ` 308020330- (2018- ` 283475635) including CurrentInvestments Cash and cash equivalents and Other bank balances of ` 286547789- (2018- ` 262565943-)against an aggregate Current liability of ` 11093758- (2018- ` 12730077-) on the reporting dateFurther whilethe Companyrsquos total equity stands at ` 306150187- (2018- ` 281343744-) and it has no borrowings In suchcircumstances liquidity risk or the risk that the company may not be able to settle or meet its obligations as theybecome due does not existMarket RiskThe company invests in mutual fund schemes of leading fund houses Such investments are susceptible tomarket price risk that arise mainly from changes in interest rate which may impact the return and value of such
57
NOTES TO THE FINANCIAL STATEMENTS
investments However given the relatively short tenure of the underlying portfolio of the mutual fund schemes inwhich the company has invested such price risk is not significantCredit RiskCompanyrsquos deployment in financial instruments such as mutual funds and fixed deposit are made in high qualitypaperscounterparties The company has receivable balances with ITC Limited under the Operating ServiceAgreement which are generally short term in nature Accordingly the Company has concluded that no provisionfor expected credit loss is required
22 Related Party DisclosuresRelated Party Transactionsi) Name of related parties and nature of relationships
ITC Limited of which the Company is an Associateii) Key Management Personnel
Board of DirectorsN Anand Chairman amp Non-Executive DirectorJ Singh Non-Executive DirectorR C Mehta Non-Executive DirectorC K Koshy Non-Executive DirectorM Narayanan Non-Executive DirectorD R Choudhury Non-Executive Director
iii) Summary of transactions during the year Amount in `
Particulars ITC Limited Key ManagementPersonnel
2019 2018 2019 2018License Fees Received 43644599 38834172 ndash ndashPurchase of Services 364514 513635 ndash ndashRemuneration of Managers on Deputation Reimbursed 5916468 5236397 ndash ndashRecoveries of Contractual Remuneration(Including Mangers on Deputation) 53058539 51502148 ndash ndashExpenses Recovered 2168155 2400471 ndash ndashExpenses Reimbursed ndash 44604 ndash ndashDividend Payments 6068675 6068675 700 700Remuneration to Key Management Personnel- Directorrsquos Sitting Fees 370000 350000Balance amount recoverable 20865894 18292750 ndash ndashBalance amount payable ndash ndash ndash ndash
58
TO THE MEMBERS OFGUJARAT HOTELS LIMITED
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying financial statementsof Gujarat Hotels Limited (ldquothe Companyrdquo) which comprisethe Balance Sheet as at 31st March 2019 the Statement ofProfit and Loss including other comprehensive incomeStatement of Changes in Equity and Statement of CashFlows for the year then ended and notes to the financialstatements including a summary of significant accountingpolicies and other explanatory information (hereinafterreferred to as ldquothe financial statementsrdquo)
In our opinion and to the best of our information andaccording to the explanations given to us the aforesaidfinancial statements give the information required by theCompanies Act 2013 (ldquothe Actrdquo) in the manner so requiredand give a true and fair view in conformity with the IndianAccounting Standards specified under section 133 of theAct read with the Companies (Indian Accounting Standards)Rules 2015 as amended (lsquoInd ASrdquo) and other accountingprinciples generally accepted in India of the state of affairsof the Company as at 31 st March 2019 and totalcomprehensive income (comprising of profit and othercomprehensive income) changes in equity and its cashflows for the year ended on that date
Basis for Opinion
We conducted our audit of the financial statements inaccordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act Our responsibilities underthose Standards are further described in the AuditorrsquosResponsibilities for the Audit of the Financial Statementssection of our report We are independent of the Companyin accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financialstatements under the provisions of the Act and the Rulesmade thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements andthe Code of Ethics We believe that the audit evidence wehave obtained is sufficient and appropriate to provide abasis for our audit opinion
Key Audit Matters
Key audit matters are those matters that in our professionaljudgment were of most significance in our audit of thesefinancial statements of the current period These matterswere addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereonand we do not provide a separate opinion on these mattersWe have determined the matters described below to bethe key audit matters to be communicated in our report
INDEPENDENT AUDITORS REPORT
Information Other than the Financial Statements andAuditorrsquos Report Thereon
The Companyrsquos Board of Directors is responsible forpreparation of the other information The other informationcomprises the information included in the Boardrsquos Reportincluding Annexures to Boardrsquos Report ManagementDiscussion and Analysis Report on Corporate Governance
and Shareholderrsquos Information but does not include thefinancial statements and our auditorrsquos report thereon
Our opinion on the financial statements does not cover theother information and we do not express any form ofassurance conclusion thereon
In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing
Sr No
Key Audit Matter How our audit addressed the matter
1 Evaluation of uncertain legal position of leasehold land
(Refer note no 20A to the financial statements)
The lease period of land held by the Company has expired The Company has filed necessary writ petition with High Court of Gujarat in April 2013 which is still pending for adjudication The Company has also made necessary application to State Government for Conversion of land from Leasehold to Freehold or Extension of Lease which is in process This matter being sub-judice essentially involves significant judgement to determine the possible outcome and therefore we have considered it as a key audit matter
We performed the following substantive procedures
Obtained details of application made to State Government Obtained details of writ petition filed to the High Court of
Gujarat and order copy passed by the High Court of Gujarat restraining the State Government from disturbing the actual possession over the property
Obtained details of progress in the matter Discussed the case with the Companyrsquos legal advisor about
the possible outcomes Read the minutes of the board meetings
Based on the procedures described managementrsquos evaluation on the same is acceptable
59
so consider whether the other information is materiallyinconsistent with the financial statements or our knowledgeobtained in the audit or otherwise appears to be materiallymisstated
If based on the work we have performed we conclude thatthere is a material misstatement of this other informationwe are required to report that fact We have nothing to reportin this regard
Responsibilities of Management and Those Charged withGovernance for the Financial Statements
The Companyrsquos Board of Directors is responsible for thematters stated in section 134(5) of the Act with respect tothe preparation of these financial statements that give atrue and fair view of the financial position financialperformance including other comprehensive incomechanges in equity and cash flows of the Company inaccordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards(Ind AS) prescribed under section 133 of the Act
This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company andfor preventing and detecting frauds and other irregularitiesselection and application of appropriate accounting policies making judgments and estimates that are reasonableand prudent and design implementation andmaintenance of adequate internal financial controls thatwere operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to thepreparation and presentation of the financial statementsthat give a true and fair view and are free from materialmisstatement whether due to fraud or error
In preparing the financial statements management isresponsible for assessing the Companyrsquos ability tocontinue as a going concern disclosing as applicablematters related to going concern and using the goingconcern basis of accounting unless management eitherintends to liquidate the Company or to cease operationsor has no realistic alternative but to do so
The Board of Directors is also responsible for overseeingthe Companyrsquos financial reporting process
Auditorrsquos Responsibilities for the Audit of the FinancialStatements
Our objectives are to obtain reasonable assurance aboutwhether the financial statements as a whole are free frommaterial misstatement whether due to fraud or error andto issue an auditorrsquos report that includes our opinionReasonable assurance is a high level of assurance but isnot a guarantee that an audit conducted in accordance withSAs will always detect a material misstatement when itexists Misstatements can arise from fraud or error and areconsidered material if individually or in the aggregate they
could reasonably be expected to influence the economicdecisions of users taken on the basis of these financialstatements
As part of an audit in accordance with SAs we exerciseprofessional judgment and maintain professionalskepticism throughout the audit We also
bull Identify and assess the risks of materialmisstatement of the financial statements whetherdue to fraud or error design and perform auditprocedures responsive to those risks and obtain auditevidence that is sufficient and appropriate to providea basis for our opinion The risk of not detecting amaterial misstatement resulting from fraud is higherthan for one resulting from error as fraud may involvecollusion forgery intentional omissionsmisrepresentations or the override of internal control
bull Obtain an understanding of internal control relevantto the audit in order to design audit procedures thatare appropriate in the circumstances Under section143(3)(i) of the Act we are also responsible forexpressing our opinion on whether the Company hasadequate internal financial controls system in placeand the operating effectiveness of such controls
bull Evaluate the appropriateness of accounting policiesused and the reasonableness of accountingestimates and related disclosures made bymanagement
bull Conclude on the appropriateness of managementrsquosuse of the going concern basis of accounting andbased on the audit evidence obtained whether amaterial uncertainty exists related to events orconditions that may cast significant doubt on theCompanyrsquos ability to continue as a going concern Ifwe conclude that a material uncertainty exists we arerequired to draw attention in our auditorrsquos report tothe related disclosures in the financial statementsor if such disclosures are inadequate to modify ouropinion Our conclusions are based on the auditevidence obtained up to the date of our auditorrsquosreport However future events or conditions maycause the Company to cease to continue as a goingconcern
bull Evaluate the overall presentation structure andcontent of the financial statements including thedisclosures and whether the financial statementsrepresent the underlying transactions and events ina manner that achieves fair presentation
We communicate with those charged with governanceregarding among other matters the planned scope andtiming of the audit and significant audit findings includingany significant deficiencies in internal control that weidentify during our audit
INDEPENDENT AUDITORS REPORT
60
We also provide those charged with governance with astatement that we have complied with relevant ethicalrequirements regarding independence and tocommunicate with them all relationships and other mattersthat may reasonably be thought to bear on ourindependence and where applicable related safeguards
From the matters communicated with those charged withgovernance we determine those matters that were of mostsignificance in the audit of the financial statements of thecurrent year and are therefore the key audit matters Wedescribe these matters in our auditorrsquos report unless lawor regulation precludes public disclosure about the mattersor when in extremely rare circumstances we determinethat a matters should not be communicated in our reportbecause the adverse consequences of doing so wouldreasonably be expected to outweigh the public interestbenefits of such communication
Report on Other Legal and Regulatory Requirements
1 As required by the Companies (Auditorrsquos Report)Order 2016 (ldquothe Orderrdquo) issued by the CentralGovernment of India in terms of sub-section (11) ofsection 143 of the Act we give in ldquoAnnexure Ardquo astatement on the matters specified in paragraphs 3and 4 of the Order to the extent applicable
2 As required by Section 143(3) of the Act we reportthat
a we have sought and obtained all the information andexplanations which to the best of our knowledge andbelief were necessary for the purposes of our audit
b in our opinion proper books of account as requiredby law have been kept by the Company so far as itappears from our examination of those books
c the Balance Sheet the Statement of Profit and lossincluding other comprehensive income the Statementof Changes in Equity and the Statement of Cash Flowsdealt with by this Report are in agreement with thebooks of account
d in our opinion the aforesaid financial statementscomply with the Indian Accounting Standards (Ind AS)prescribed under Section 133 of the Act
e on the basis of the written representations receivedfrom the directors as on 31st March 2019 taken onrecord by the Board of Directors none of the directorsis disqualified as on 31st March 2019 from beingappointed as a director in terms of Section 164(2) ofthe Act
f with respect to the adequacy of the internal financialcontrols with reference to financial statements of theCompany and the operating effectiveness of suchcontrols refer to our separate report in ldquoAnnexure Brdquoand
g with respect to the other matters to be included in theAuditorrsquos Report in accordance with the requirementsof section 197(16) of the Act as amended theCompany has neither paid nor provided for anyremuneration to its directors during the year
h with respect to the other matters to be included in theAuditorrsquos Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules 2014 in ouropinion and to the best of our information andaccording to the explanations given to us
i the Company does not have any pendinglitigations which would impact its financialposition
ii the Company did not have any long-termcontracts including derivative contracts for whichthere were any material foreseeable losses
iii there has been no delay in transferringamounts required to be transferred to theInvestor Education and Protection Fund by theCompany
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No 106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
61
ANNEXURE A TO THE INDEPENDENT AUDITORrsquoS REPORT
The annexure referred to in our Independent AuditorrsquosReport to the members of Gujarat Hotels Limited (ldquotheCompanyrdquo) on the financial statements for the year ended31st March 2019 we report that
i (a) The Company has maintained proper recordsshowing full particulars including quantitativedetails and situation of fixed assets
(b) As explained to us the Company has a regularprogram of physical verification of fixed assetswhich in our opinion is reasonable The assetswhich were to be covered as per the saidprogram have been physically verified by themanagement during the year In our opinion andAccording to the information and explanationsgiven to us no material discrepancies werenoticed on such verification
(c) According to the information and explanationsgiven to us and on the basis of our examinationof the records of the Company the title deeds ofimmovable properties are held in the name ofthe Company with respect to land the Companyhas filed a writ petition with Gujarat High Courtseeking that the Gujarat State Government bedirected to take action on Companyrsquosapplication to have the leasehold land of theHotel Converted to freehold and transferred toCompany as per the existing government policyin this regard
ii The Company does not have any inventory andtherefore reporting under clause (ii) of the Order isnot applicable to the Company
iii The Company has not granted any loans secured orunsecured to Companies firms Limited LiabilityPartnerships or other parties covered in the registermaintained under section 189 of the Companies Act2013 and therefore reporting under clause (iii) of theOrder is not applicable to the Company
iv The Company has not given any loans guaranteesor security In respect of the Investments made in ouropinion and according to the information andexplanations given to us the Company has compliedwith the provisions of section 186 of the Act
v According to the information and explanations givento us the Company has not accepted any depositsduring the year from the public within the meaning ofprovisions of section 73 to 76 of the Companies Act2013 and the rules framed thereunder and thereforereporting under clause (v) of the Order is notapplicable to the Company
vi In our opinion and according to the information andexplanations given to us in view of Rule 3 of theCompanies (Cost Records and Audit) AmendmentsRules 2014 the maintenance of cost records undersub-section (1) of section 148 of the Companies Act2013 is not applicable to the Company and thereforereporting under clause (vi) of the Order is notapplicable to the Company
vii (a) According to the information and explanationsgiven to us the Company has been regular indepositing with appropriate authoritiesundisputed statutory dues including providentfund employeersquos state insurance income-taxvalue added tax goods and service tax cessand other statutory dues applicable to it Furtherno undisputed amounts payable in respect ofprovident fund employeersquos state insuranceincome tax value added tax goods and servicetax cess and any other statutory dues were inarrears as at 31st March 2019 for a period ofmore than six months from the date theybecome payable
(b) According to the information and explanationsgiven to us there are no dues of Income taxsales tax value added tax and goods andservice tax which have not been deposited onaccount of any dispute
viii The Company has not taken any loans or borrowingsfrom financial institutions banks and government orhas not issued any debentures and thereforereporting under clause (viii) of the Order is notapplicable to the Company
ix The Company has not raised moneys by way of initialpublic offer or further public offer (including debtinstrument) and term loans during the year andtherefore reporting under clause (ix) of the Order isnot applicable to the Company
x To the best of our knowledge and according toinformation and explanations given to us no materialfraud by the Company or on the Company by its officersor employees has been noticed or reported duringthe course of our audit
xi In our opinion and according to the information andexplanations given to us the Company has not paidor provided any managerial remuneration during theyear and therefore reporting under clause (xi) of theOrder is not applicable to the Company
xii The Company is not a Nidhi company and thereforereporting under clause (xii) of the Order is notapplicable to the Company
INDEPENDENT AUDITORS REPORT
62
xiii In our opinion and according to the information andexplanations given to us and based on ourexamination of the records of the Company alltransactions with the related parties are in compliancewith Section 177 and 188 of the Act where applicableand the details have been disclosed in the financialstatements as required by the applicable accountingstandards
xiv According to the information and explanations givento us the Company has not made any preferentialallotment or private placement of shares or fully orpartly convertible debentures during the year underreview and therefore reporting under clause (xiv) ofthe Order is not applicable to the Company
xv In our opinion and according to the information andexplanations given to us the Company has not
entered into any non-cash transactions with directorsor persons connected with directors and thereforereporting under clause (xv) of the Order is notapplicable to the Company
xvi The Company is not required to be registered undersection 45-IA of the Reserve Bank of India Act 1934
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533
INDEPENDENT AUDITORS REPORT
63
ANNEXURE ldquoBrdquo TO THE INDEPENDENT AUDITORSrsquo REPORT
(Referred to in paragraph 2(f) under lsquoReport on Other Legaland Regulatory Requirementsrsquo section of our report to theMembers of Gujarat Hotels Limited on the financialstatements of even date)
Report on the Internal Financial Controls with referenceto financial statements under Clause (i) of Sub-section 3of Section 143 of the Act
W e have audited the internal financial controls withreference to financial statements of Gujarat Hotels Limited(ldquothe Companyrdquo) as of 31st March 2019 in conjunction withour audit of the financial statements of the Company for theyear ended on that date
Managementrsquos Responsibility for Internal FinancialControls
The Companyrsquos management is responsible forestablishing and maintaining internal financial controlsbased on the internal control over financial reporting criteriaestablished by the Company considering the essentialcomponents of internal control stated in the Guidance Noteon Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountantsof India (ldquoICAIrdquo) These responsibilities include the designimplementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuringthe orderly and efficient conduct of its business includingadherence to companyrsquos policies the safeguarding of itsassets the prevention and detection of frauds and errorsthe accuracy and completeness of the accounting recordsand the timely preparation of reliable financial informationas required under the Act
Auditorsrsquo Responsibility
Our responsibility is to express an opinion on theCompanyrsquos internal financial controls with reference tofinancial statements based on our audit We conductedour audit in accordance with the Guidance Note on Audit ofInternal Financial Controls over Financial Reporting (theldquoGuidance noterdquo) and the Standards on Auditing issued byICAI and deemed to be prescribed under section 143(10)of the Companies Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the ICAIThose Standards and the Guidance Note require that wecomply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whetheradequate internal financial controls with reference tofinancial statements were established and maintained andif such controls operated effectively in all material respects
Our audit involves performing procedures to obtain auditevidence about the adequacy of the internal financialcontrols with reference to financial statements and their
operating effectiveness Our audit of internal financialcontrols with reference to financial statements includedobtaining an understanding of internal financial controlswith reference to financial statements assessing the riskthat a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal controlbased on the assessed risk The procedures selecteddepend on the auditorrsquos judgement including theassessment of the risks of material misstatement of thefinancial statements whether due to fraud or error
We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our auditopinion on the Companyrsquos internal financial controls withreference to financial statements
Meaning of Internal Financial Controls with reference tofinancial statements
A Companyrsquos internal financial controls with reference tofinancial statements is a process designed to providereasonable assurance regarding the reliability of financialreporting and the preparation of financial statements forexternal purposes in accordance with generally acceptedaccounting principles A Companyrsquos internal financialcontrols with reference to financial statements includesthose policies and procedures that (1) pertain to themaintenance of records that in reasonable detailaccurately and fairly reflect the transactions anddispositions of the assets of the Company (2) providereasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements inaccordance with generally accepted accounting principlesand that receipts and expenditures of the Company arebeing made only in accordance with authorisations ofmanagement and directors of the Company and (3) providereasonable assurance regarding prevention or timelydetection of unauthorised acquisition use or dispositionof the Companyrsquos assets that could have a material effecton the financial statements
Inherent Limitations of Internal Financial Controls withreference to financial statements
Because of the inherent limitations of internal financialcontrols with reference to financial statements includingthe possibility of collusion or improper managementoverride of controls material misstatements due to erroror fraud may occur and not be detected Also projections ofany evaluation of the internal financial controls withreference to financial statements to future periods aresubject to the risk that the internal financial control withreference to financial statements may become inadequatebecause of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate
INDEPENDENT AUDITORS REPORT
64
Opinion
In our opinion the Company has in all material respectsan adequate internal financial controls with reference tofinancial statements and such internal financial controlswith reference to financial statements were operatingeffectively as at 31st March 2019 based on the internalcontrol over financial reporting criteria established by theCompany considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal
INDEPENDENT AUDITORS REPORT
Financial Controls over Financial Reporting issued by theInstitute of Chartered Accountants of India
For K C Mehta amp CoChartered Accountants
Firmrsquos Registration No106237W
Vishal P DoshiPlace New Delhi PartnerDate 15th April 2019 Membership No 101533