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PEERLESS SECURITIES LIMITED

Peerless Securities LimitedAnnual Report & Accounts

2014-15

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BOARD OF DIRECTORS

Sri Pranab Kumar Choudhury

Sri Sunil Kanti Roy

Sri Ashish Kumar Thakur

Sri Bhargab Lahiri

Sri Dibyendra Nath Sengupta

Sri Jayanta Roy

Sri Jitendra Kumar Panda

Sri Atul Kumar Bajpai

CHAIRMANSri Pranab Kumar Choudhury

MANAGING DIRECTOR & CEOSri Jitendra Kumar Panda

WHOLETIME DIRECTORSri Atul Kumar Bajpai

CHIEF FINANCIAL OFFICERSri Abhishek Tantia

COMPANY SECRETARYSri Dinesh Mourya

AUDITORSM/S De & BoseChartered Accountants

PRINCIPAL BANKERSHDFC Bank Ltd.

State Bank of India

ICICI Bank Ltd.

Axis Bank Ltd.

REGISTERED OFFICEPeerless Mansion1, Chowringhee Square,2nd Floor, Kolkata – 700069CIN : U67120WB1995PLC067616Phone : 91 033 2243-5942/43Fax : 91 033 2243-6941Website : www.peerlesssec.co.inE-mail : [email protected]

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DIRECTORS’ REPORT

TO THE MEMBERS

The Directors have pleasure in placing before you the Twentieth Annual Report on the business and operationsof the Company and the audited accounts for the year ended 31st March, 2015.

A Summary of the financial results for the year 2014-15, as compared to the previous year, is given below:

FINANCIAL RESULTS(Rs. in Lakhs)

CONSOLIDATED STAND ALONE

2015 2014 2015 2014

Gross Revenue 1273.15 598.23 1271.69 597.14

Profit/(Loss) before Depreciation and tax (295.40) (432.47) (296.54) (429.41)

Less: Depreciation 57.77 42.29 57.77 42.29

Profit/(Loss) before tax (353.17) (474.76) (354.31) (471.70)

Less: Provision for Tax including Deferred Tax (55.77) 1.15 (56.24) 2.10

Profit/(Loss) after Taxes (297.40) (475.91) (298.06) (473.80)

Add: Balance brought forward from previous year (1291.22) (815.31) (1289.11) (815.31)

Less: Additional Depreciation on fixed Assets 7.98 — 7.98 —

Leaving a balance to be carried forward to next year (1596.60) (1291.22) (1595.16) (1289.11)

DIVIDEND

Your Directors do not recommend any dividend for the financial year ended 31st March, 2015 in view of the loss.

BUSINESS ENVIRONMENT DURING THE YEAR

The year FY 2014-15 witnessed big rise in the equity market. The benchmark index S&P Nifty gained around 26%during the year amid high volatility, and touched record high in March 2015.

Indian capital market was buoyant as expectation ran high from the new government for revival of investment climatein the country. Fall in the crude oil prices, moderation in inflation, lowering of current account and fiscal deficitand deregulation in fuel prices helped to improve the sentiments among investors. Though slow progress on kickstarting infrastructure projects, weak corporate earnings and certain key bills not being passed in parliament tookaway some shine of the market towards the end of the financial year.

Government’s initiatives for ‘Make in India’ program, labour reforms, plan for building smart cities across the country,big infrastructure and road projects and successful coal auction aided in improving investment climate in India duringthe year. RBI move to kick-start the lowering of interest rate cycle also aided to speed up economic growth.

COMPANY’S OPERATIONS

Brokerage and Commission earnings continue to be the mainstay of our business with a growth rate of around150 percent over the previous year. The Company’s continuous efforts have resulted in increase in total revenueby 113 percent over the previous year. To achieve the improved results administrative and other cost of the Companyhas gone up only by 37 percent.

The Company incurred a loss of Rs. 2.98 crores in F.Y.2014-15 (as against a loss of Rs. 4.74 crores in the previousyear) after making full provisions of Rs. 1.55 crores on diminution of long term investments. The net worth of theCompany as on the closing of F-Y 2014-15 was Rs. 23.19 crores compared to Rs. 26.25 crores in 2013-14.

On the whole the Company was able to maintain stable operating results because of increased income and controlledexpenses.

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As on 31.03.2015, the Company had 27 branches and 209 registered Sub-brokers/Authorised Persons as against26 and 174 respectively as on 31.03.2014. During the year the Company opened four new branches i.e. Thane,Puri, Bankura and Borivili-Mumbai, and a rationalization of the branch network resulted in the closing of three lossmaking branches in Jalpaiguri, Pune and Balasore. Key priorities of your Company for FY 2015-16 shall continueto focus on expansion in existing markets as well as in Tier II and Tier III locations in India through AuthorisedPersons/Sub-brokers.

SUBSIDIARY COMPANY

Peerless Commodities Ltd was incorporated in FY 2013-14 to provide Commodity Broking services, operations havenot been initiated during the year. However, considering the positive outlook of the Commodity Market, full-fledgedoperations of the subsidiary is expected to commence in the FY 2015-16.

The gross Revenue of the Company for FY 2014-15 stood at Rs. 1.46 lacs (previous year Rs.1.09 lacs). The Companyhas a net profit after tax of Rs. 0.68 lacs (previous year loss of Rs. 2.12 lacs)

OUTLOOK FOR FISCAL 2015-16

The global economy is on a path of slow but steady recovery in the last one year lead by US and some of theEuro zone nations. US Federal Reserve ended its massive $1.6 trillion bond buying program (QE3) in October 2014and are on course to hike interest rate in the year 2015. Although the pace of rate hike, would be gradual andit would take several years for rate to normalize. The European Central bank (ECB) started its massive bond buyingprogram and Bank of Japan’s liquidity injection measures would keep the liquidity flow stable in global marketsin near term.

Fear of US Fed rate hike and strength in US dollar would keep pressure in emerging market currencies includingIndian rupee. Potential revival in crude oil prices would pose bigger risk for our economy and can delay economicrevival process.

Our market has staged an impressive pullback during the last one year on sustained inflows of funds by way ofinvestments by Foreign Portfolio Investors (FPI), who seem to be optimistic of fast economic revival and highercorporate growth expectations. Higher participations from Domestic Institutional Investors (DII) in coming days areexpected and would provide much needed depth in Indian capital market. Retail participation is also likely to increasewith revival in the primary market in coming months. Going forward, inflows from foreign investors likely to bemuted as global investors are increasingly becoming more positive in Chinese equities compared to India in theshort term.

India’s current account deficit (CAD) estimated to be narrowed further in FY 2014-15 from 1.7% of GDP inFY 2013-14. Steps taken by the RBI, inflows from Foreign Portfolio Investors (FPI) record foreign exchange reserveand improving macroeconomic scenario would help Indian rupee to outperform other emerging market currencies.

Low oil prices may mean an upside surprise in 2015 for economy like India and would present a golden opportunityfor India to reform its costly fuel subsidy programs. Oil led commodities disinflation would make a strong case forsustainable bull markets in India and would make it less vulnerable to global shocks. Commodity disinflation wouldprovide room to RBI to embark on accommodative monetary policy in India.

Containing CAD & fiscal deficit, inflation combined with stable rupee would help in reviving the economy in secondhalf of the year, though the threat of a below normal monsoon looms as a big risk over faster economic recoveryin this year.

Equity market likely to witness positive consolidation in this year and participation would not be very high as investorsare in wait and watch mode to check the ground level impact of economic reform process spearheaded by the newgovernment.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with the provisions of the Companies Act, 2013 (Act) and the Articles of Association of the Company,Mr Jayanta Roy, Director of the Company, retires by rotation at the ensuing Annual General Meeting and beingeligible has offered himself for re–appointment.

During the year under review Mr. Dipankar Basu resigned from the office of Chairman and Director w.e.f. 12thSeptember, 2014 due to personal reasons and Mr. Achintya Sankar Phani has also resigned from the office of Director

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w.e.f. 15.06.2015 on health ground. Your Directors acknowledge their contribution and guidance towards thedevelopment of the Company during their tenure. Mr. Pranab Kumar Choudhury was appointed as Chairman ofthe Company w.e.f. 21st November, 2014.

During the year under review, the members approved the appointments of Mr. Pranab Kumar Choudhury, Mr. AshishKumar Thakur and Mr. Dibyendra Nath Sengupta as Independent Directors who are not liable to retire by rotationfor a period of 3 years.

The members have also re–appointed Mr. Atul Kumar Bajpai as the Whole-time Director for a period of 3 years.

The Company has received declarations from all the Independent Directors of the Company confirming that theymeet the criteria of independence as prescribed under the Act.

During the year under review, on the recommendations of Nomination & Remuneration Committee, the Boardapproved the appointments of Mr Abhishek Tantia as Chief Financial Officer (CFO) and Mr. Dinesh Mourya asCompany Secretary.

Mr. Saurabh Basu resigned as the Vice President - Risk Management & Compliance and Company Secretary witheffect from 31.12.2014. The Board thanks Mr. Basu for the role he played during his tenure with the Company.

NOMINATION & REMUNERATION COMMITTEE AND NOMINATION & REMUNERATION POLICY

The terms of reference of Nomination & Remuneration Committee are in conformity with the requirements of Section178 of the Companies Act, 2013. The Committee formulates criteria for determining qualifications, positive attributesand criteria for independence of Directors and also considers appointment and remuneration for the Directors, keyand senior managerial personnel. It recommends to the Board to put in place the long-term performance objectivesappropriate to the working of the Company and its goals. The Committee carries out evaluation of every Director’sperformance periodically.

Composition:

The Nomination & Remuneration Committee comprise two Independent Directors and two Non-executive Director,namely, Mr. Sunil Kanti Roy, Non-executive Director as Chairman, Mr. Bhargab Lahiri, Non-executive Director asmember, Mr. Dibyendra Nath Sengupta, Independent Director as Member, Mr. Pranab Kumar Choudhury, IndependentDirector as Member.

The Company has formulated a Nomination & Remuneration Policy for appointment/removal and remunerationof directors and key managerial personnel including criteria for determining qualifications, positive attributes andcriteria for independence of a Director and other matters as specified u/s 178(3) of the Companies Act, 2013.

The key features of the policy are given below:

Objectives

• To lay down criteria and terms & conditions with regard to identifying persons qualified to become Directors(Executive and Non-Executive) and Senior Management and Key Managerial positions

• To determine remuneration based on the Company’s size, financial position, trends and practices on remunerationprevailing in peer Companies and industry as a whole.

• To carry out evaluation of the performance of Directors.

• To provide them rewards linked directly to their efforts, performance, dedication and achievement relating tothe Company’s operations.

• To retain, motivate and promote talent and to ensure long term sustainability of talented managerial personscommensurate with the requirements of the Company.

Applicability

The Policy is applicable to:

• Directors (both, Executive and Non-Executive)

• Key Managerial Personnel

• Senior Management Personnel

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“Senior Management” for the purpose of this Policy mean personnel of the Company who are members of its coremanagement team excluding Board of Directors comprising all members of management one level below the executivedirectors including the functional heads.

General

This Policy is divided in three parts: Part – A covers the matters to be dealt with and recommended by the Committeeto the Board, Part – B covers the nomination, appointment and removal, and Part – C covers remuneration, perquisitesetc.

MEETINGS OF THE BOARD

The Board meets at regular intervals to discuss and decide on business strategies/policies and review the financialperformance of the Company. In the financial year 2014-15, the Board met four times. The meetings were heldon 22nd May 2014, 11th September 2014, 21st November 2014 and 12th March 2015. The interval between twomeetings was well within the maximum period mentioned under Section 173 of the Companies Act, 2013.

Attendance of Directors at the Board Meetings:

Sr. No. Name of Directors No. of BoardMeetings Attended

1. Mr. Pranab Kumar Choudhury 4 of 42. Mr. Dipankar Basu* 2 of 23. Mr. Sunil Kanti Roy 4 of 44. Mr. Achintya Sankar Phani* 3 of 45. Mr. Ashish Kumar Thakur 3 of 46. Mr. Bhargab Lahiri 2 of 47. Mr. Dibyendra Nath Sengupta 4 of 48. Mr. Jayanta Roy 3 of 49. Mr. Jitendra Kumar Panda 4 of 4

10. Mr. Atul Kumar Bajpai 4 of 4

* Mr. Dipankar Basu resigned from the Board on 12th September 2014.

* Mr. Achintya Sankar Phani resigned from the Board on 15th June 2015.

COMMITTEES OF THE BOARD

Currently, the Board has three committees: Audit Committee, Nomination & Remuneration Committee and BusinessPlan Monitoring Committee. Compositions of the committees are as follows:

NAME OF THE COMMITTEE COMPOSITION OF COMMITTEE

Audit Committee Mr. Dibyendra Nath Sengupta, ChairmanMr. Pranab Kumar ChoudhuryMr. Ashish Kumar ThakurMr. Bhargab LahiriMr. Achintya Sankar Phani*

Nomination & Remuneration Committee Mr. Sunil Kanti Roy, ChairmanMr. Dibyendra Nath SenguptaMr. Pranab Kumar ChoudhuryMr. Bhargab Lahiri

Business Plan Monitoring Committee Mr. Dibyendra Nath Sengupta, ChairmanMr. Pranab Kumar ChoudhuryMr. Bhargab Lahiri

* Mr Achintya Sankar Phani resigned from the Audit Committee on 15th June 2015.

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In the financial year 2014-15, the Audit Committee met five times (22nd May 2014 , 25th August 2014, 11th September2014, 21st November 2014 and 12th March 2015 ),Nomination & Remuneration Committee three times (11thSeptember 2014, 21st October 2014 and 12th March 2015) and Business Plan Monitoring Committee two times(25th June 2014 and 05th February 2015). During the year Remuneration Committee which met only on 22ndMay 2014 was reconstituted as Nomination & Remuneration Committee in compliance with Companies Act, 2013.

During the year Human Resources Committee was dissolved. There was no occasion to hold any meeting by theCommittee during the year under review.

There was no occasion of non-acceptance of any recommendation of the Audit Committee by the Board.

DIRECTORS' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them,your Directors make the following statements in terms of Section 134(3)(c)of the Companies Act, 2013:

a) in the preparation of the annual accounts for the year ended March 31, 2015, the applicable accounting standardsread with requirements set out under Schedule III to the Act, have been followed and there are no materialdepartures from the same;

b) the Directors have selected such accounting policies and applied them consistently and made judgments andestimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Companyas at March 31, 2015 and of the Profit and loss of the Company for the year ended on that date;

c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities;

d) the Directors have prepared the annual accounts on a 'going concern' basis;

and

e) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws andthat such systems are adequate and operating effectively.

RISK MANAGEMENT

The Company manages, monitors and reports on the principal risks and uncertainties that can impact its abilityto achieve its strategic objectives. The Company's management systems, organisational structures, processes, standards,code of conduct and behaviors together form the Risk Management System (RMS) that manages associated risks.

The Company has introduced several improvements to Integrated Enterprise Risk Management, Internal ControlsManagement and Assurance Frameworks and processes to drive a common integrated view of risks, optimal riskmitigation responses and efficient management of internal control and assurance activities.

INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internal financial controls with reference to financial statements. During theyear, such controls were tested and no reportable material weaknesses in the design or operation were observed.

EXPLANATION OR COMMENTS BY THE BOARD ON AUDITORS REPORT

The Board noted that the Statutory Auditors of the Company have not given any qualification, reservation or adverseremarks or disclaimers for the financial year 2014-15.

AUDITORS

At the Annual General Meeting held on September 11, 2014, M/s De & Bose , Chartered Accountants, (Firm RegistrationNo 302175E ), were appointed as Statutory Auditors of the Company to hold office till the conclusion of the AnnualGeneral Meeting to be held in the calendar year 2017. In terms of the first provision to Section 139 of the CompaniesAct, 2013, the appointment of the auditors shall be placed for ratification at every Annual General Meeting. Accordingly,the appointment of M/s De & Bose, Chartered Accountants, as Statutory Auditors of the Company, is placed for

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ratification by the shareholders. In this regard, the Company has received a certificate from the auditors to the effectthat if they are reappointed, it would be in accordance with the provision of Section 141 of the Companies Act,2013.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGSAND OUTGO

Particulars regarding conservation of energy and technology absorption are not furnished as these are not applicable.There has been no foreign exchange earnings or outgo during the year.

LOANS, GUARANTEES & INVESTMENTS AS PER SECTION 186 OF THE COMAPNIES ACT 2013

No such transaction took place during the financial year 2014-15.

PARTICULARS OF EMPLOYEES

A statement showing the name(s) of employees is annexed herewith as Annexure ‘A’ to this Report in terms ofRule 5 (2) of the Companies (Appointment and Remuneration) Rules, 2014.

EXTRACT OF ANNUAL RETURN

Extract of Annual Return of the Company is annexed herewith as Annexure ‘B’ to this Report.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

All contracts/arrangements/transactions entered by the Company during the financial year 2014-15 with related partieswere in the ordinary course of business and on an arm's length basis and annexed hereto in this report as Annexure‘C’.

DISCLOSURE UNDER THE SEXUAL HARASSEMENT OF WOMEN AT WORKPALCE (PREVENTION,PROHIBITION AND REDRESSAL) ACT, 2013

Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. Allemployees (permanent, contractual, temporary, trainees) are covered under this policy.

The followings is a summary of sexual harassment complaints received and disposed off during the year 2014-15.

No. of complaints received : Nil

No. of complaints disposed off : Nil

GENERAL

Your Directors state that no disclosure or reporting is required in respect of the following items as there were notransactions on these items during the year under review:

1. Details relating to deposits covered under Chapter V of the Act and others.

2. Corporate Social Responsibility

3. Neither the Managing Director & CEO nor the Whole–time Director of the Company receives any remunerationor commission from its Holding or Subsidiary Company.

4. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the goingconcern status and Company's operations in future.

5. There is no material change/event occurred after balance sheet date till the date of the report.

ACKNOWLEDGEMENT

Your Directors wish to place on record their sincere thanks to Securities and Exchange Board of India, NationalStock Exchange of India Ltd., Bombay Stock Exchange Ltd., National Securities Depositories Ltd. and CentralDepository Services (India) Ltd. for their valued support and co-operation.

The patronage and co operation received from clients and business associates are thankfully acknowledged by the

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Directors, as also the trust reposed by them in the Company.

Your Directors recognise the commitment and contribution of the employees at all levels and look forward to theirincreased involvement and dedicated services in the journey ahead.

Finally your Directors take this opportunity to express their appreciation and express their thanks for the continuedsupport cooperation and guidance received from the holding Company viz., The Peerless General Finance & InvestmentCo. Ltd.

For and on behalf of the Board of Directors

Pranab Kumar ChoudhuryChairman

DIN No 00015470Place : KolkataDate : 15th June 2015

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Annexure - “A”

A. Particulars of Employees pursuant to the provisions of Section 134 of the Companies Act, 2013read with sub-rule (2) of rule 5 of Companies (Appointment and Remuneration of ManagerialPersonnel) Rules, 2014 and forming part of the Directors’ Report for the year ended 31st March,2015.

Sr. No. Name Mr. JITENDRA KUMAR PANDA

1 Designation of the employee; Managing Director & CEO

2 Remuneration received; Rs. 69,73,072

3 Nature of employment, whethercontractual or otherwise; Contractual

4 Qualifications B.Sc, ACA, ICWAI

5 Experience (Years) 20

6 Date of commencement of employment; 09.10.2013

7 The age of such employee; 45

8 The last employment held by such employeebefore joining the company; Business Head of Capital First Securities Ltd

9 The percentage of equity shares held by theemployee in the company within the meaningof clause (iii) of sub-rule (2) above; and Nil

10 Whether any such employee is a relative ofany director or manager of the company andif so, name of such director or manager: No

B. Employed for a part of the financial year and in receipt of remuneration aggregating Rs. 5,00,000/- or moreper month - None

Note: 1. Gross remuneration comprises salary and allowance, company’s contribution to provident, superannuationPerformance Pay, and gratuity funds, where applicable, and monetary value of perquisites.

2. All appointments are subject to the rules and regulations of the Company for the time being in force.

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Annexure - “B”

ANNEXURE TO THE DIRECTORS’ REPORT

Form No. MGT-9

EXTRACT OF ANNUAL RETURNas on the financial year ended on 31st March 2015

[Pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of theCompanies (Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS:

CIN U67120WB1995PLC067616

Registration Date 19/01/1995

Name of the Company PEERLESS SECURITIES LTD

Category/Sub-Category of the Company Public Company Limited by Shares

Address of the Registered office and contact details 1 CHOWRINGHEE SQUARE 2ND FLOOR,KOLKATA,WEST BENGAL INDIA 700069Tel. No: 033 2243 5942Fax No: 033 2243 6941Email: [email protected]: www.peerlesssec.co.in

Whether listed company No

Name, Address and Contact details of Registrarand Transfer Agent, if any No

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

All the business activities contributing 10 % or more of the total turnover of the company shall be stated:-

Sl. No. Name and Description of NIC Code of the % to total turnover of themain products/services Product/service company

1. Broking and Allied services 67120 79.38%

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES

Sl. NAME AND ADDRESS CIN/GLN HOLDING/ % of ApplicableN0. OF THE COMPANY SUBSIDIARY/ shares Section

ASSOCIATE held

1. THE PEERLESS GENERAL U66010WB1932 HOLDING 97.54 % 2(46)FINANCE & INVESTMENT CO LTD PLC007490 COMPANYand PEERLESS BHAVAN,3 ESPALANDE EAST,KOLKATA - 700069

2. PEERLESS COMMODITIES LIMITED U74900WB2013 SUBSIDIARY 98.60% 2(87)(iii)and 1 CHOWRINGHEE SQUARE PLC196191 COMPANY2ND FLOOR, KOLKATAWEST BENGAL, INDIA 700069

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IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)

i) Category-wise Share Holding

Category of Shareholders No. of Shares held at the No. of Shares held at the % beginning of the year end of the year Change

duringtheyear

Demat Physical Total % of Demat Physical Total % ofTotal Total

Shares Shares

A. Promoters

(1) Indian

a) Individual/HUF — 1806 1806 0.01 — 1806 1806 0.01 Nil

b) Central Govt. — — — — — — — — Nil

c) State Govt. — — — — — — — — Nil

d) Bodies Corp — 24561600 24561600 99.50 — 24561600 24561600 99.50 Nil

e) Banks/FI — — — — — — — — Nil

f) Any Other…. — — — — — — — — Nil

Sub-total (A) (1):- — 24563406 24563406 99.50 — 24563406 24563406 99.50 Nil

(2) Foreign

a) NRIs – Individuals — — — — — — — — Nil

b) Other – Individuals — — — — — — — — Nil

c) Bodies Corp. — — — — — — — — Nil

d) Banks/FI — — — — — — — — Nil

e) Any Other…. — — — — — — — — Nil

Sub-total (A) (2): - — — — — — — — — Nil

Total shareholding of

Promoter (A) =

(A)(1)+(A)(2) — 24563406 24563406 99.50 — 24563406 24563406 99.50 Nil

B. Public Shareholding

1. Institutions

a) Mutual Funds — — — — — — — — Nil

b) Banks/FI — — — — — — — — Nil

c) Central Govt — — — — — — — — Nil

d) State Govt(s) — — — — — — — — Nil

e) Venture Capital Funds — — — — — — — — Nil

f) Insurance Companies — — — — — — — — Nil

g) FIIs — — — — — — — — Nil

h) Foreign Venture capital — — — — — — — — Nil

funds

i) Others (specify) — — — — — — — — Nil

Sub-total (B) (1):- — — — — — — — — Nil

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IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)

i) Category-wise Share Holding (contd.)

Category of Shareholders No. of Shares held at the No. of Shares held at the % beginning of the year end of the year Change

duringtheyear

Demat Physical Total % of Demat Physical Total % ofTotal Total

Shares Shares

2. NonInstitutional

a) Bodies Corp.

i) Indian — 43000 43000 0.17 — 43000 43000 0.17 —

ii) Overseas — — — — — — — — —

b) Individuals

i) Individual shareholders — 79808 79808 0.33 — 79808 79808 0.33 —

holding nominal share

capital upto Rs. 1 lakh

ii) Individual shareholders — — — — — — — — —

holding nominal share

capital in excess of

Rs 1 lakh

c) Others (specify)

Sub-total (B)(2):- Total — 122808 122808 0.50 — 122808 122808 0.50 —

Public Shareholding

(B)=(B)(1)+ (B)(2) — 122808 122808 0.50 — 122808 122808 0.50 —

C. Shares held by

Custodian for GDRs

& ADRs — — — — — — — — —

Grand Total (A+B+C) — 24686214 24686214 100 — 24686214 24686214 100 Nil

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(ii) Shareholding of Promoters

Sl. Shareholder's Shareholding at the Shareholding at theNo. Name beginning of the year end of the year

No.of % of % of No.of % of % of %Shares total Shares Shares total Shares change

Shares Pledged/ Shares Pledged/ in shareof the encumbered of the encumbered holding

Company to total Company to total duringthe year

1. THE PEERLESS

GENERAL FINANCE

& INVESTMENT

CO LTD 24080000 97.54 % Nil 24080000 97.54 % Nil Nil

2 Shikha Holdings Pvt. Ltd. 481600 1.95% Nil 481600 1.95% Nil Nil

3 Mr. Sunil Kanti Roy 602 0.002% Nil 602 0.002% Nil Nil

4 Ms. Shikha Roy 602 0.002% Nil 602 0.002% Nil Nil

5 Mr. Jayanta Roy 602 0.002% Nil 602 0.002% Nil Nil

(iv) Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders ofGDRs and ADRs):

Sl. Shareholding at the Cumulative ShareholdingNo. beginning of the year during the year (01.04.2014

(01.04.2014) to 31.03.2015)

For Each of the Top No. of % of total Increase/ No. of % of total10 Shareholder shares Shares of the Decrease in shares Shares of the

Company shareholding Company

1 Ashish Kusum Chatterjee 77400 0.31 Nil 77400 0.31

2 The Peerless Advertising &

Allied Services Pvt. Ltd 43000 0.17 Nil 43000 0.17

3 Asoke Kumar Mukhuty 602 0.002 Nil 602 0.002

(iii) Change in Promoters’ Shareholding (please specify, if there is no change) Not Applicable

Sl. Shareholding at the Cumulative ShareholdingNo. beginning of the year during the year

No. of % of total No. of % of totalshares Shares of the shares Shares of the

Company Company

At the beginning of the year N.A N.A N.A N.A

Date wise Increase/Decrease inPromoters Share holding duringthe year specifying the reasonsfor increase/decrease(e.g. allotment/transfer/bonus/sweat equity etc N.A N.A N.A N.A

At the End of the year N.A N.A N.A N.A

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(v) Shareholding of Directors and Key Managerial Personnel:

Sl. Shareholding at the Cumulative ShareholdingNo. beginning of the year during the year (01.04.2014

(01.04.2014) to 31.03.2015)

For Each of the No. of % of total Increase/ No. of % of totalDirectors and KMP shares Shares of the Decrease in shares Shares of the

Company shareholding Company

1 Mr.S.K. Roy,Director 602 0.002% Nil 602 0.002%

2. Mr. B. Lahiri,Director 1204 0.004% Nil 1204 0.004%

3 Mr. Jayanta RoyDirector 602 0.002% Nil 602 0.002%

4 Mr.A.K. BajpaiWholetime Director 602 0.002% Nil 602 0.002%

Note: No other Directors and KMPs hold any share of the Company

V. INDEBTEDNESS

Indebtedness of the Company including interest outstanding/accrued but not due for payment

Secured Loans Unsecured Deposits Totalexcluding Loans IndebtednessDeposits

Indebtedness at the beginning ofthe financial yeari) Principal Amount 2.82 Nil 1.08 3.90ii) Interest due but not paid — — — —iii) Interest accrued but not due — — — —

Total (i+ii+iii) 2.82 Nil 1.08 3.90

Change in Indebtedness duringthe financial year• Addition — — 0.52 0.52• Reduction 1.32 — — 1.32

Net Change (1.32) 0.52 (0.80)

Indebtedness at the end ofthe financial year:

i) Principal Amount 1.50 — 1.60 3.10ii) Interest due but not paid 0.01 — — 0.01iii) Interest accrued but not due — — — —

Total (i+ii+iii) 1.51 — 1.60 3.11

(Rs. In Crores)

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VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

A. Remuneration to Managing Director, Whole-time Directors and/or Manager:

Sl. No. Particulars of Remuneration Name of MD/WTD/ TotalManager Amount

MR. J. K PANDA MR. A.K.

(MD & CEO) BAJPAI (WTD)

1 Gross salary(a) Salary as per provisions contained insection 17(1) of the Income-tax Act, 1961 Rs. 58.57 Rs.40.52 Rs.99.09

(b) Value of perquisites u/s 17(2) Income-taxAct, 1961 Rs. 2.37 Rs.1.07 Rs. 3.44

(c) Profits in lieu of salary under section17(3) Income Tax Act, 1961 Nil Nil Nil

2 Stock Option Nil Nil Nil

3 Sweat Equity Nil Nil Nil

4 Commission– as % of profit Nil Nil Nil– others,specify…

5 Others, please specify Nil Nil Nil

Total (A) Rs. 60.94 Rs. 41.59 Rs. 102.53

Ceiling as per the Act

B. Remuneration to other directors:

1. Independent Directors

Sl. No. Particulars of Remuneration Name of Directors TotalAmount

MR. P. K. MR. D. N. MR. A. K.

CHOUDHURY SENGUPTA THAKUR

1. Fee for attending board/committee meetings 1.30 1.30 0.7 3.30

2. Commission Nil Nil Nil Nil

3. Others, please specify Nil Nil Nil Nil

Total (B1) 3.30

(Rs. Lakhs)

(Rs. Lakhs)

231


2. Other Non- Executive Directors

Sl. Particulars of Name of Directors TotalNo. Remuneration Amount

MR. S. K MR. A. S MR. B. MR. J. MR. D. BASU

ROY PHANI LAHIRI ROY (up to

12.09.2014)

1. Fee for attending board/committee meetings 0.60 0.70 0.70 0.30 0.20 2.50

2. Commission Nil Nil Nil Nil Nil Nil

3. Others, please specify Nil Nil Nil Nil Nil Nil

Total (B2) 2.50

Total Managerial Remuneration (B1+B2) 5.80

Total Sitting Fees 5.80

Total Commission Nil

Overall Ceiling as per the Act for Payment of commission to Non-Executive Directors Nil

(Rs. Lakhs)

C. REMUNERATION TO KEY MANAGERIAL PERSONNELOTHER THAN MD/MANAGER/WTD

(Rs. Lakhs)

Key Managerial Personnel

Sl. Particulars of Remuneration Company Company CFO (MR. A. TOTALNo. Secretary Secretary TANTIA)

(up to (from (11.09.201431.12.2014) 12.03.2015 to to 31.03.2015)(MR. S.BASU) 31.03.2015)

(MR. D.MOURYA)

Gross salary

(a) Salary as per provisions Rs. 5.15 Rs. 0.26 Rs. 6.01 Rs. 11.42contained in section 17(1) ofthe Income-tax Act, 1961(b) Value of perquisites u/s — — — —17(2) Income-tax Act, 1961(c) Profits in lieu of salary — — — —under section 17(3) Income-taxAct, 1961

Stock Option — — — —

Sweat Equity — — — —

Commission– as % of profit — — — —– others, specify — — — —

Others, please specify — — — —

Total Rs. 5.15 Rs. 0.26 Rs. 6.01 Rs. 11.42

232


VII. PENALTIES/PUNISHMENT/COMPOUNDING OF OFFENCES:

Type Section Brief Details of Authority Appealof the Description Penalty/ [RD/NCLT/ made,ifCompanies Punishment/ COURT] any (giveAct Compounding Details)

fees imposed

A. COMPANY

Penalty Nil Nil Nil Nil Nil

Punishment Nil Nil Nil Nil Nil

Compounding Nil Nil Nil Nil Nil

B. DIRECTORS




C. OTHER OFFICERS IN DEFAULT




233


Annexure ‘C’

Form No. AOC-2

Particulars of contracts/arrangements made with related parties

[Pursuant to Clause (h) of sub-section (3) of section 134 of the Companies Act, 2013 and Rule 8(2) of the Companies(Accounts) Rules, 2014 – AOC -2]

This Form pertains to the disclosure of particulars of contracts/arrangements entered into by the Company withrelated parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 including certain arm’slength transactions under third proviso thereto.

DETAILS OF CONTRACTS OR ARRANGEMENTS OR TRANSACTIONS NOT AT ARM’S LENGTHBASIS.

There were no contracts or arrangements or transactions entered into during the year ended March 31 2015,which were not at arm’s length basis.

DETAILS OF MATERIAL CONTRACTS OR ARRANGEMENTS OR TRANSACTIONS AT ARM’S LENGTHBASIS.

The details of material contracts or arrangements or transactions at arm’s length basis in ordinary course of businessfor year ended March 31 2015, are as follows:-

Name of related Party Nature of Duration of Salient Amountrelationship contract terms (Rs. In lacs)

Nature of contract

Purchase of shared servicesincluding facilities and personnel

The Peerless General Finance Holding Since 1995 Rent, 95.96& Investment Co. Ltd. company – ongoing Electricity etc.

Peerless Hotels Ltd. Fellow Not Cost of food 0.99Subsidiary applicable and conference

room hirecharges

Peerless Financial Services Ltd. Fellow 20.08.2014 LoanSubsidiary 1 Year processing Fee 0.81

Peerless Hospitex Hospital and Fellow Not Availing medical 1.01Research Centre Ltd. Subsidiary applicable facilities

Kaizen Leisure & Holidays Ltd. Directors Not Cost of Air 5.67holding more applicable Ticket, Hotelthan 2 % booking etc.

Sale of services

The Peerless General Finance & Holding Since 1995 Brokerage & 10.95Investment Co. Ltd. company – ongoing DP services

Peerless Mutual Fund Refer note 19.02.10 Brokerage 4.57below – ongoing

Peerless Financial Services Ltd. Fellow 09.11.09 Brokerage & 1.86Subsidiary – ongoing DP services

234


Name of related Party Nature of Duration of Salient Amountrelationship contract terms (Rs. In lacs)

Sale of Assets

The Peerless General Finance & Holding Not Sale of 0.75Investment Co. Ltd. Company applicable Assets

Note:

Peerless Funds Management Company Ltd and Peerless Trust Management Company Ltd (both being fellow subsidiaryof the Company) act as Investment Manager and Trustees to Peerless Mutual Fund respectively.

For and on behalf of the Board of Directors

Pranab Kumar ChoudhuryChairman

DIN No 00015470KolkataDated: 15th June, 2015

235


INDEPENDENT AUDITORS' REPORT

TO THE MEMBERS OF PEERLESS SECURITIES LIMITED

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of PEERLESS SECURITIES LIMITED (“theCompany”), which comprise the Balance Sheet as at March 31, 2015, the Statement of Profit and Loss, the CashFlow Statement for the year then ended, and a summary of the significant accounting policies and other explanatoryinformation.

Management’s Responsibility for the Standalone Financial Statements

The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act,2013 (“the Act”) with respect to the preparation of these standalone financial statements that give a true and fairview of the financial position, financial performance and cash flows of the Company in accordance with the accountingprinciples generally accepted in India, including the Accounting Standards specified under Section 133 of the Act,read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies;making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance ofadequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness ofthe accounting records, relevant to the preparation and presentation of the financial statements that give a true andfair view and are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit. We havetaken into account the provisions of the Act, the accounting and auditing standards and matters which are requiredto be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards of Auditing specified under Section 143(10) of the Act.Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether the financial statements are free of material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financialstatements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of materialmisstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditorconsiders internal financial control relevant to the Company’s preparation of the financial statements that give a trueand fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purposefor expressing an opinion on whether the Company has in place an adequate internal financial controls system overfinancial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriatenessof the accounting policies used and the reasonableness of the accounting estimates made by the Company’s Boardof Directors, as well as evaluating the overall presentation of financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our auditopinion on the standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalonefinancial statements give the information required by the Act in the manner so required and give a true and fair viewin conformity with the accounting principles generally accepted in India, of the state of affairs of the Company asat March 31, 2015, and its loss and its cash flows for the year ended on that date.

236


Report on Other Legal and Regulatory Requirements

1. In our opinion, proper books of account and records as specified in rule 15 of the Securities Contract (Regulation)Rules,1957 have been kept so far as appears from our examination of such books.

2. The Company has complied with the requirements of the stock exchanges so far as they relate to maintenanceof accounts and was regular in submitting the required accounting information to the stock exchanges.

3. As required by the Companies (Auditor’s Report) Order, 2015 (“the Order”), issued by the Central Governmentof India in terms of Section 143(11) of the Act, we give in the Annexure a statement on the matters specifiedin paragraphs 3 and 4 of the order, to the extent applicable.

4. As required by Section 143(3) of the Act, we report that:

a. We have sought and obtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purpose of our audit of the financial statements;

b. In our opinion, proper books of account as required by 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 Loss and the Cash Flow Statement dealt with by this reportare in agreement with the books of account;

d. In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specifiedunder Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;

e. On the basis of the written representations received from the directors as on 31st March, 2015 taken on recordby the Board of Directors, none of the directors is disqualified as on March 31, 2015 from being appointedas a director in terms of Section 164(2) of the Act;

f. With respect to the other matters to be included in the Auditors’ Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and accordingto the explanations given to us:

i) The Company has disclosed the impact of pending litigations on its financial position in its standalonefinancial statements – refer note 2.27.2 to the financial statements;

ii) The Company did not have any long-term contracts including derivative contracts for which there wereany material foreseeable losses;

iii) There were no amounts which were required to be transferred to the Investor Education and ProtectionFund by the Company.

For & on behalf ofDE & BOSE

Chartered Accountants

Firm Registration No. 302175E

Durgadas DePartner

Membership No. 003729

Place : Kolkata

Dated : 15th June 2015

237


ANNEXURE TO THE INDEPENDENT AUDITORS' REPORT

Referred to in Paragraph 3 under the heading of ‘Report on Other Legal and Regulatory Requirements’ section ofour report of even date.

1.1 a. The Company has maintained proper records showing full particulars including quantitative details andsituations of its fixed assets.

b. According to the information and explanations given to us, the fixed assets have been physically verifiedby the management in a phased periodical manner, which in our opinion, is reasonable having regard tothe size of the Company and nature of its assets. No material discrepancies were noticed on such physicalverification.

1.2 a. The securities held as stock in trade have been confirmed with the statement of holding of depository atregular interval and at the end of year. In our opinion, the frequency of verification of statement of holdingis reasonable.

b. In our opinion and according to the information and explanations given to us, the procedure of confirmationof securities held as stock in trade followed by the Management are reasonable and adequate in relationto the size of the Company and nature of its business.

c. In our opinion and according to the information and explanations given to us, the Company has maintainedproper records of securities held as stock in trade and as informed to us, no discrepancies have been noticedon verification of statement of holding and the book records.

1.3 The Company has not granted any loans , secured or unsecured, to companies, firms or other parties coveredin the register maintained under Section 189 of the Companies Act, 2013.

1.4 In our opinion and according to the information and explanations given to us, there are an adequate internalcontrol system commensurate with the size of the Company and the nature of its business for the purchase ofsecurities , fixed assets and sale of securities and services. During the course of our audit, we have not observedany continuing failure to correct major weaknesses in such internal control system.

1.5 According to the information and explanations given to us, the Company has not accepted any deposit fromthe public. Therefore, the provisions of clause(v) of paragraph 3 of the CARO 2015 are not applicable to theCompany.

1.6 The Central Government has not prescribed the maintenance of cost records under Section 148(1)(d) of theAct for any of the services rendered by the Company.

1.7 a. According to the records of the Company, the Company is generally regular in depositing the undisputedstatutory dues including provident fund, employees’ state insurance, income tax, service tax and othermaterial statutory dues as applicable with the appropriate authorities. According to the information andexplanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstandingas at March 31, 2015 for a period of more than six months from the date of becoming payable.

b. According to the information and explanations given to us and the records of the Company examined byus, the details of statutory dues as on March 31, 2015 have not been deposited on account of dispute asunder :

Name of the Statute Nature of the Dues Forum where the dispute Amountis pending (Rs. in lacs)

Service Tax Service Tax and Custom, Excise and Service 5.66Penalty F.Y. 2006-07 Tax Appellate Tribunal

Income Tax Income Tax A.Y. 2008-09 Commissioner of 22.22Act, 1961 U/S 156/143(3)/263/143(3) Income Tax (Appeals)

238


c. There have been no transferring amounts, required to be transferred, to the Investor Education andProtection Fund by the Company.

1.8 The Company does not have accumulated losses more than fifty percent of its net worth at the end of thefinancial year. The Company has incurred cash losses during the financial year covered by the audit and alsoin the immediately preceding financial year.

1.9 According to the records of the Company examined by us and the information and explanation given to us,the Company has not defaulted in repayment of dues to bank. The Company has not obtained any borrowingsfrom any financial institution or by way of debentures.

1.10 According to the information and explanations given to us, the Company has not given any guarantee forloans taken by others from banks or financial institutions.

1.11. To the best of our knowledge and belief and according to the information and explanations given to us, shortterm loans were raised by the Company during the year and were applied for the purpose for which theywere raised.

1.12 In our opinion and according to the information and explanations given to us, no fraud by the Company andon the Company has been noticed or reported during the year.

For & on behalf ofDE & BOSE

Chartered Accountants

Firm Registration No. 302175E

Durgadas DePartner


Place : Kolkata

Dated : 15 June 2015

239


BALANCE SHEETAS AT 31ST MARCH, 2015

Note As at As at31st March, 2015 31st March, 2014` ` ` `

EQUITY AND LIABILITIES1. Shareholders’ Funds

(a) Share Capital 2.1 246,862,140 246,862,140(b) Reserves and Surplus 2.2 (14,883,260) 15,721,340

2. Non-Current Liabilities(a) Long-term Provisions 2.3 1,198,217 229,430

3. Current Liabilities(a) Short-term borrowings

Loans 2.4 & 2.5 15,001,105 28,203,570 Deposits 2.6 16,041,559 31,042,664 10,836,445 39,040,015 (b) Trade Payables 2.7 23,972,573 29,447,577 (c) Other Current Liabilities 2.8 10,265,877 5,757,188 (d) Short-term Provisions 2.9 1,290,069 1,765,007

299,748,280 338,822,697

ASSETS1. Non-Current Assets

(a) Fixed Assets 2.10(i) Tangible Assets 6,731,099 11,149,464(ii) Intangible Assets 1,488,924 8,220,023 1,421,767 12,571,231

(b) Non-Current Investments 2.11 30,842,285 64,856,979 (c ) Deferred Tax Assets (Net) 2.12 6,862,563 881,253 (d) Long-term Loans and Advances 2.13 35,144,275 28,831,723 (e) Other Non-Current Assets 2.14 500,000 20,007,309

2. Current Assets(a) Current Investments 2.15 975,000 2,042,000(b) Inventories 2.16 16,520 -(c) Trade Receivables 2.17 66,435,070 98,620,902(d) Cash and Cash Equivalents 2.18 139,256,740 98,222,844(e) Short-term loans and advances 2.19 10,236,888 10,612,769(f) Other Current Assets 2.20 1,258,916 2,175,687

299,748,280 338,822,697Significant Accounting Policies 1Notes on Financial Statements 2This is the Balance Sheet referred to in our report of even date.

On behalf of the Board

D. N. Sengupta DirectorJitendra Kumar Panda Managing

Director & CEO

For & on behalf ofDE & BOSE(Firm Registration No. 302175E)Chartered Accountants

Durgadas DePartnerMembership No. 003729

Kolkata, 15th June 2015

Dinesh MouryaCompany Secretary

Abhishek TantiaChief Financial Officer

240


STATEMENT OF PROFIT AND LOSSFOR THE YEAR ENDED 31ST MARCH, 2015

Note Year ended Year ended31st March, 2015 31st March, 2014

` `

Revenue from Operations 2.21 111,107,787 46,806,391Other Income 2.22 16,061,122 12,907,635

TOTAL REVENUE 127,168,909 59,714,026

Expenses :

Employee Benefits Expenses 2.23 74,859,024 56,256,425Finance Costs 2.24 3,054,644 1,463,359Administrative and Other expenses 2.25 63,439,120 41,324,133Depreciation 2.10 5,776,872 4,228,793Provision for Diminution in value of Investment 2.11 15,467,472 (18,000)Diminution in value of Stock in Trade 2,522 —

TOTAL EXPENSES 162,599,654 103,254,710

Profit/(Loss) before Exceptional Itemsand Taxation (35,430,745) (43,540,684)

Exceptional Items 2.26 — 3,629,737

Profit/(Loss) before Taxation (35,430,745) (47,170,421)

Tax Expense :

Deferred Tax 2.12 (5,624,364) 209,619

Profit/(Loss) for the year (29,806,381) (47,380,040)

Earnings per equity shares of Rs. 10/- each

Basic and Diluted Earnings per Share [Refer to Note : 2.27.05] (1.21) (1.92)

Significant Accounting Policies 1

Notes on Financial Statements 2

This is the Statement of Profit and Loss referred to in our report of even date.



Director & CEO






241


FOR THE YEAR ENDED 31ST MARCH, 2015

2014-15 2013-14` `

A. CASH FLOW FROM OPERATING ACTIVITIES

Net Profit before Tax (35,430,745) (47,170,421)

Adjusted for :

Depreciation 5,776,872 4,228,793Diminution in value of Stock in Trade 2,522 —Diminution in value of Non-Current Investment 15,467,472 —Diminution in value of Current Investment — (18,000)Interest Income (9,869,878) (12,623,727)Dividend Income (448,713) (912,143)Interest Paid 2,972,282 1,463,359Provision for Doubtful Debts and Advances 516,253 2,765,047Bad Debt written off 5,753,624 —Loss on sale of Long Term Investments 1,880,264 879,463Profit on sale of Current Investments (935,090) (23,145)Provision for Doubtful Debts written back (6,591,418) —Loss on written off of Fixed Assets 90,182 —

14,614,372 (4,240,353)

Operating Profit before Working Capital Changes (20,816,373) (51,410,774)

Adjusted for :Trade and Other Receivables 26,651,045 (55,318,296)Inventories (19,042) 556,970Loans and Advances (863,091) 83,749Trade and Other Payables 4,602,278 26,172,484

30,371,190 (28,505,093)

Cash generated from/(used in) Operations 9,554,817 (79,915,867)

Tax paid (Net) (782,748) (3,904,773)

Net Cash (used in) Operating Activities (10,337,565) (76,011,094)

B. CASH FLOW FROM INVESTING ACTIVITIES

Purchase of Fixed Assets (2,926,370) (4,500,051)Proceeds from sale of fixed assets 255,359 —Purchase of Investments — (873,525)Proceeds from Sale of Investments 18,669,048 81,561,059Proceeds from maturity of Fixed Deposit with Bank 40,490,000 —Investment to Fixed Deposit with Bank (50,500,000) (6,205,593)Interest Income 10,798,365 17,080,579Dividend Income 448,713 912,143

Net Cash from Investing Activities 17,235,115 87,974,612

CASH FLOW STATEMENT

242


2014-15 2013-14` `

C CASH FLOW FROM FINANCING ACTIVITIES

Overdraft and Short Term Loan facility (13,202,465) 5,954,811Interest Paid (2,841,912) (1,463,359)

Net Cash (used in)/from Financing Activities (16,044,377) 4,491,452

Net Increase in Cash and Cash Equivalents 11,528,303 16,454,970Cash and Cash Equivalents (Opening Balance) 27,732,844 11,277,874

Cash and Cash Equivalemts (Closing Balance)(Note - 1) 39,261,147 27,732,844

Note :

1. Cash and Cash Equivalents comprise :

Cash in hand 631,241 206,765

Balance with Banks :

In Current Account 38,629,906 27,526,079

39,261,147 27,732,844

This is the Cash Flow Statement referred to in our report of even date.

CASH FLOW STATEMENT (Contd.)



Director & CEO






243


NOTE : 1

SIGNIFICANT ACCOUNTING POLICIES

(A) Basis of preparation of financial statements

(i) The Financial Statements have been prepared on historical cost basis and on the principle of a going concern.The Company follows mercantile system of accounting unless stated otherwise. The Financial Statements havebeen prepared in accordance with the provisions of the Companies Act, 2013 and Accounting Standards as prescribedunder section 133 of the said Act, read with rule 7 of the Companies (Accounts) Rule, 2014 and other generallyaccepted accounting principles. The accounting policies have been consistently applied by the Company and areconsistent with those used in the previous year.

(ii) Incomes and Expenses are accounted for on accrual basis, provisions are made for all known liabilities and arebased on available information.

(iii) Brokerage and other income earned on secondary market operations is accounted on trade dates. Advisory services& related income are accounted on accrual basis. Depository income are accounted on cash basis due to uncertaintyof realization.

(iv) Income on account of interest is recognised on a time proportion basis taking into account the amount outstandingand the rate applicable and to the extent considered realisable.

(v) Income on account of dividend is recognised when the right to receive is established.

(vi) Claims and refunds whose recovery cannot be ascertained with reasonable certainty are accounted for as andwhen accepted and/or on actual receipt basis.

(B) Use of Estimates

The preparation of financial statements requires estimates and assumptions that affect the reported amount of assets,liabilities, revenues and expenses and disclosure of contingent liabilities on the date of financial statements.

The difference between the actual results and estimates is recognised in the period in which the results are known /materialized.

(C) Fixed Assets

(i) Tangible Fixed Assets are stated at cost of acquisition inclusive of duties, taxes, incidental/installation expenses,etc less accumulated depreciation.

(ii) Intangible Fixed Assets are stated at the cost of acquisition less accumulated amortised amount.

(D) Depreciation

(i) Depreciation of Tangible Fixed Assets is provided for under Written Down Value method according to the usefullives of the assets and procedure prescribed in the Schedule II of the Companies Act, 2013.

(ii) Intangible Assets, viz. Computer Software, are amortised over a period of five years or in lesser period if usefullife is lower than five years on straight line basis.

(E) Investments

Investments that are readily realisable and intended to be held for not more than a year are classified as current investments.All other investments are classified as long term investments. Current investments are carried at lower of cost and fairvalue determined on an individual investment basis. Long term investment are carried at cost.

However, provision for diminution in value is made to recognize a decline other than temporary in the value of thelong term investments.

(F) Stock-in-Trade

Securities acquired with the intention to trade by taking advantage of the short-term price movement are categorizedas Stock-in-Trade and are valued at lower of cost and fair value, computed on individual basis.

(G) Leases

Operating lease payments are recognised as an expense in the profit and loss account.

244


(H) Retirement Benefits

(i) The Company has Defined Contribution plans for post employment benefits, namely Provident Fund. Contributionto Provident Fund is made at the prescribed rates to the Provident Fund Commissioner and is charged to theProfit and Loss Account. There are no other obligation other than the contribution payable.

(ii) The Company has Defined Benefit plans namely Gratuity for employees, covered by a Group Gratuity cum LifeAssurance Policy with Life Insurance Corporation of India (LIC). Annual contribution to the gratuity fund asdetermined by LIC is expensed in the year of contribution. The liability for Gratuity and is determined on thebasis of an actuarial valuation at the end of the year. Gains and losses arising out of actuarial evaluations arerecognized immediately in the Profit and Loss as income or expense. The liability for leave encashment is determinedon an accrual basis according to Human Resource Policy.

(I) Impairment of Assets

At each Balance Sheet date the Company assesses whether there is any indication of impairment of assets. If any suchindication exists, the Company estimates the recoverable amount. If the carrying amount of the assets exceeds itsrecoverable amount, an impairment loss is recognized in the accounts to the extent the carrying amount exceeds therecoverable amount. An impairment loss is reversed if there has been change in the recoverable amount and suchloss either no longer exists or has decreased. Impairment loss/reversal thereof is adjusted to the carrying value of therespective assets.

(J) Provision for Current and Deferred Tax

Provision for Current Income Tax is made after taking into consideration benefits admissible under the provisions ofthe Income-tax Act,1961. Deferred tax resulting from "timing difference" between book profit and taxable profit is accountedfor using the tax rates and laws that have been enacted or substantively enacted as on the balance sheet date.

The deferred tax asset is recognised and carried forward only to the extent that there is a reasonable certainty thatthe assets will be realized in future.

(K) Provisions, Contingent liability and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligationas a result of past events, it is probable that there will be an outflow of resources and a reliable estimate can be madeof the amount of the obligation. These are reviewed at each balance sheet date and adjusted to reflect the currentbest estimate. Contingent Assets are neither recognized nor disclosed in the financial statement. Contingent Liabilitiesare not provided for and are disclosed by way of notes.

NOTE : 1 (Contd.)

Note : 2.1

SHARE CAPITAL

As at 31.03.2015 As at 31.03.2014

Particulars Number Amount Number Amount

Authorised Capital

Equity Shares of Rs. 10/- each 25,000,000 250,000,000 25,000,000 250,000,000

250,000,000 250,000,000

Issued, Subscribed and Paid-up Capital

Equity Shares of Rs. 10/- eachAt the beginning and at the end of the year 24,686,214 246,862,140 24,686,214 246,862,140

246,862,140 246,862,140

NOTE : 2

NOTES ON FINANCIAL STATEMENTS FOR THE YEAR 31ST MARCH, 2015

(Amount in ̀ )

245


As at 31.03.2015 As at 31.03.2014

Name of the Holding Company Number Amount Number Amount

The Peerless General Finance & InvestmentCompany Ltd. 24,080,000 240,800,000 24,080,000 240,800,000

2.1.2. Disclosure of shares in the Company held by its holding company

As at 31.03.2015 As at 31.03.2014

Number of Number ofshares of the shares of the

Company Companyheld by the held by the

Name of the Shareholder shareholder % holding shareholder % holding

The Peerless General Finance & InvestmentCompany Ltd. 24,080,000 97.54% 24,080,000 97.54%

2.1.3. Details in respect of shares in the Company held by each shareholder holding more than 5% shares

As at 31.03.2015 As at 31.03.2014

Particulars Amount Amount Amount Amount

Securities Premium Account

At the beginning and at the end of the year 102,927,570 102,927,570

General Reserve


Surplus as per the Statement of Profit and LossAt the beginning of the year (128,911,741) (81,531,701)

Adjustment on account of depreciation asper Schedule II of the Companies Act, 2013(net of deferred tax amounting to Rs.356,946)[Refer to Note 2.10] (798,219) —

Add: Loss for the year as per Statement ofProfit and Loss (29,806,381) (47,380,040)

At the end of the year (159,516,341) (128,911,741)

TOTAL (14,883,260) 15,721,340

(Figures in `)

Note : 2.2

RESERVES AND SURPLUS

(Amount in ̀ )

2.1.1. Rights, preferences and restrictions attached to equity sharesThe Equity Shares of the Company, having par value of `10 per share, rank pari passu in all respects including voting rightsand entitlement to dividend. The dividend proposed by the Board of Directors is subject to the approval of the shareholders inthe ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to recieve the remaining assets of theCompany, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity sharesheld by the shareholders.

246


Particulars As at 31.03.2015 As at 31.03.2014

Provision for Employee Benefits – Gratuity 1,198,217 229,430

TOTAL 1,198,217 229,430

Note : 2.3

LONG TERM PROVISIONS (Figures in `)


Clients 22,971,070 28,521,568Others 1,001,503 926,009

TOTAL 23,972,573 29,447,577

Note : 2.7

TRADE PAYABLES (Figures in `)


Margin Money - Clients 12,019,189 8,617,816Security Deposit - Subbrokers 3,475,020 2,172,810Security Deposit - Others 74,646 32,323Sundry Deposit 472,704 13,496

TOTAL 16,041,559 10,836,445

Note : 2.6

DEPOSITS(Figures in `)


Loan repayable on demand-Overdraft 1,105 28,203,570

TOTAL 1,105 28,203,570

Secured on lien of Fixed Deposits with Bank

Note : 2.4

LOANS FROM BANKS - Secured(Figures in `)


Loan repayable on demand-Short Term Facility 15,000,000 —

TOTAL 15,000,000 —

Partly secured on lien of Fixed Deposits with Bank

Note : 2.5

LOANS FROM BANKS - Partly Secured(Figures in `)

247



Provision for Employee Benefits –Leave Encashment 1,290,069 1,765,007

TOTAL 1,290,069 1,765,007

Note : 2.9

SHORT TERM PROVISIONS (Figures in `)


Government Dues 1,212,861 490,902Sundry Creditors (Other than Micro,Small and Medium Enterprises) 9,053,016 5,189,466Others — 76,820

TOTAL 10,265,877 5,757,188

Note : 2.8

OTHER CURRENT LIABILITIES (Figures in `)

Note : 2.10

TANGIBLE AND INTANGIBLE ASSETS

PARTICULARS GROSS CARRYING VALUE DEPRECIATION/AMORTISATION NET CARRYING VALUE

Adjustmentagainst

As at Additions Disposal/ As at Up to For the Retained Disposal/ As at As at As at

1.4.2014 Adjustment 31.3.2015 31.3.2014 year Earnings Adjustment 31.3.2015 31.3.2015 31.3.2014

TANGIBLE ASSETS :

1. Furni ture and Fi t t ings 12,281,987 438,024 539,455 12,180,556 8,866,796 1,216,251 70,885 359,751 9,794,181 2,386,375 3,415,191

2. Motor Vehic les 3 ,011,475 — 629,057 2,382,418 2,095,920 242,285 60,434 533,902 1,864,737 517,681 915,555

3. Off ice Equipments 7 ,816,751 610,270 182,166 8,244,855 4,626,942 1,615,156 879,986 111,484 7,010,600 1,234,255 3,189,809

4. Computers and Data

Processing Units 12,528,290 1,259,461 — 13,787,751 8,899,381 2,151,722 143,860 — 11,194,963 2,592,788 3,628,909

SUB TOTAL (A) 35,638,503 2,307,755 1,350,678 36,595,580 24,489,039 5,225,414 1,155,165 1,005,137 29,864,481 6,731,099 11,149,464

INTANGIBLE ASSETS :

1. Computer Software * 7,213,179 618,615 — 7,831,794 5,791,412 551,458 — — 6,342,870 1,488,924 1,421,767

SUB TOTAL (B) 7,213,179 618,615 — 7,831,794 5,791,412 551,458 — — 6,342,870 1,488,924 1,421,767

TOTAL (A + B) 42,851,682 2,926,370 1,350,678 44,427,374 30,280,451 5,776,872 1,155,165 1,005,137 36,207,351 8,220,023 12,571,231

Previous Year 38,351,631 4,500,051 — 42,851,682 26,051,658 4,228,793 — — 30,280,451 12,571,231

* Other than internal ly generated.

In terms of Schedule I I of the Companies Act , 2013, the carry ing amount of the assets exis t ing as on 01/04/2014 has been deprec iated over the remaining l i fe of the assets .

Consequent upon the appl icat ion of Schedule I I as above, depreciat ion charge for the year i s h igher by ` 3 ,351,730/- . In respect of assets , where the remaining l i fe has

expired as on 1st Apr i l , 2014, the carry ing amount of ` 798,219 (net of deferred tax ` 356,946) has been fu l ly depreciated and has been adjusted against surplus

(accumulated losses) as at the beginning of the year .

(Figures in `)

248


B. Investment in Shares – Quoted

Name of the Company Face Value 31st March, 2015 31st March, 2014

per share No. of Equity Book Value No. of Equity Book ValueShares Shares

The Calcutta Stock Exchange Ltd. * 1 250 250 250 250Aban Offshore Ltd. 2 300 258,240 800 688,640Andhra Bank 10 6,000 710,864 6,000 710,864Bharat Heavy Electricals Ltd. # 2 5,500 2,740,685 5,500 2,740,685Central Bank of India 10 8,000 1,487,801 8,000 1,487,801Crompton Greaves Ltd. # 2 13,000 4,077,850 13,000 4,077,850East India Hotels Ltd. # 2 38,000 4,856,701 40,500 5,203,188Housing Development and Infrastructure Ltd. 10 5,000 860,615 5,000 860,615Indiabulls Real Estate Ltd. 2 5,000 988,359 5,000 988,359Indiabulls Infrastructure and Power Ltd. 2 14,750 — 14,750 —IDBI Bank Ltd. # 10 13,500 2,164,979 13,500 2,164,979IFCI Ltd. 10 6,500 397,150 6,500 397,150IRB Infrastructure Developers Ltd. # 10 17,450 4,957,486 17,450 4,957,486JP Associates Ltd. # 2 14,000 1,684,470 14,000 1,684,470JSW Energy Ltd. # 10 26,987 2,929,842 29,987 3,324,843Larsen & Toubro Ltd. # 2 — — 1,700 1,916,697NIIT Ltd. 2 12,000 803,426 22,000 1,475,776Power Finance Corporation Ltd. # 10 1,250 313,188 11,050 3,127,534PTC India Ltd. 10 5,000 581,375 5,000 581,375Punj Lloyd Ltd. # 2 26,000 3,231,552 26,000 3,231,552Rural Electrification Corporation Ltd. # 10 8,500 2,578,750 18,000 5,885,977Reliance Capital Ltd. # 10 2,000 1,446,471 2,000 1,446,471Reliance Industries Ltd. # 10 800 874,060 2,900 3,186,741Reliance Infrastructure Ltd. 10 2,400 2,617,565 2,950 3,246,505State Bank of India # 1 17,000 4,983,481 2,250 6,767,060Tata Steel Ltd. 10 700 271,597 1,500 697,900

45,816,757 60,850,768Less : Provision for Diminution in value of investment 15,467,472 —

30,349,285 60,850,768

# PARTLY OR FULLY PLEDGED WITH IL&FS LTD. ON 31.03.2014

Share of State Bank of India splitted 1:10 during the year

(Figures in `)

Note : 2.11

NON-CURRENT INVESTMENTS

(Trade – Fully paid up)

A. Investment in Subsidiary

Name of the Subsidiary Face Value 31st March, 2015 31st March, 2014


Peerless Comodities Limited * 10 49,300 493,000 49,300 493,000

493,000 493,000

(Figures in `)

249


Note : 2.11 (Contd.)

C. Investment in Debentures - Quoted

Name of Debentures Nominal Value 31st March, 2015 31st March, 2014

per debenture No. of Book Value No. of Book ValueDebentures Debentures

(Figures in `)

Tata Steel Ltd. 10.4% NCD 1,000,000 — 1 1,020,000Power Finance Corporation Ltd. 7.95% NCD 1,000,000 — 1 975,000

— 1,995,000

D . Investment in Bonds - Quoted

Name of Bonds Nominal Value 31st March, 2015 31st March, 2014

per Bond No. of Book Value No. of Book ValueBonds Bonds

(Figures in `)

PGC Ltd. BOND, JULY 2015 1,250,000 — 1 1,112,500(6.1% Taxable 17/07 )

SBI BOND, MARCH 2021 10,000 — 40 405,711(9.75% Taxable)

— 1,518,211

TOTAL OF NON-CURRENT INVESTMENTS 30,842,285 64,856,979

Aggregate amount of Quoted Investments 45,816,507 64,363,729Aggregate amount of Unquoted Investments 493,250 493,250Aggregate amount of market value of Quoted Investments 30,917,618 36,541,835Aggregate provision for diminution in value of Investments 15,467,472 —

* denotes - not quotedFor basis of valuation, refer Note 1(E)

Note : 2.12(Figures in `)DEFERRED TAX (NET)

Adjusted (Charge)/Particulars Closing as at against retained Credited Opening as at

31.03.2015 earnings to P&L 01.04.2014

Deferred Tax AssetProvision for Leave Encashment 398,631 — (146,756) 545,387Provision for Gratuity 370,249 — 299,355 70,894Provision for diminution in value of investment 4,779,449 — 4,779,449 —

5,548,329 — 4,932,048 616,281Deferred Tax LiabilityDepreciation (1,314,234) 356,946 692,316 (264,972)

(1,314,234) 356,946 692,316 (264,972)

Net Deferred Tax Asset/( Liability) 6,862,563 881,253

Deferred Tax Credited to Statement of Profit and Loss 5,624,364

250


Note : 2.13(Figures in `)

(Figures in `)

(Figures in `)

Note : 2.15

CURRENT INVESTMENTS

(Trade - Fully Paid up)

Investment in Debentures - Quoted


per debenture No. of Value No. of Valuedebenture debenture

Power Finance Corporation Ltd. 1,000,000 1 975,000 —7.95% NCD 24 FEB 2016

Tata Motors Finance Ltd. 500,000 — 4 2,042,00010.75% NCD 25 MAR 2020

975,000 2,042,000

TOTAL OF CURRENT INVESTMENTS 975,000 2,042,000

Total market value of Current Investments 998,500 2,047,000

For basis of valuation, refer Note 1(E)

LONG TERM LOANS AND ADVANCES


Security Deposits withExchanges and Clearing Houses 31,610,411 25,763,455Depositories 1,500,000 1,500,000Others 1,251,981 1,436,279

34,362,392 28,699,734Other Loans and advances

Loan to Staff 7,182 56,414Prepaid Expenses 764,700 65,574Other Advances 10,001 781,883 10,001 131,989

TOTAL 35,144,275 28,831,723

Note : 2.14

OTHER NON-CURRENT ASSETS


Non-current bank balance [Refer to Note 2.18] 500,000 19,995,593Interest Accrued but not due on fixed deposits with banks — 11,716

TOTAL 500,000 20,007,309

251


(Figures in `)

Note : 2.16

INVENTORIES - Quoted

Name of the Company 31st March, 2015 31st March, 2014

No. of Value No. of ValueEquity Shares Equity Shares

Reliance Industries Ltd. 20 16,520MSL Industries Ltd. 32,000 — 32,000 —Malanpur Steel Ltd. 233 — 233 —

TOTAL 16,520 —

For basis of valuation, refer note 1(F)

(Figures in `)

Note : 2.17

TRADE RECEIVABLES

(Unsecured)


Outstanding for a period exceeding six monthsfrom the date they are due for payment Considered good 4,809,207 11,094,187 Considered doughtful 3,718,502 9,784,296

Others - Considered good 61,625,863 87,526,715

70,153,572 108,405,198Less : Provision for doubtful debts 3,718,502 9,784,296

66,435,070 98,620,902

Note : 2.18

CASH AND CASH EQUIVALENTS

Particulars Non-current Current

As at As at As at As at31.03.2015 31.03.2014 31.03.2015 31.03.2014

Balances with banks in current accounts 38,629,906 27,526,079Cash in Hand (including Stamps) 631,241 206,765Other Balances with Banks :

Fixed deposit with banks under lienOriginal maturity more than 12 months buthaving maturity period within 3 monthsfrom the reporting date — — 10,000,000 20,490,000Others 500,000 19,995,593 89,995,593 50,000,000Amount disclosed under non-current assets

[Refer note 2.14] (500,000) (19,995,593) — —

TOTAL — — 139,256,740 98,222,844

(Figures in `)

252


(Figures in `)

Note : 2.19

SHORT TERM LOANS AND ADVANCES

(Unsecured)


Security Deposits - Others 252,859 47,298Advance Income Tax (including Tax Deducted at Source)[Net of provision] 5,276,867 6,059,615Tax Refundable 219,670 219,670Service Tax (Centvat Credit) 324,701 130,215Other Loans and Advances

Staff Loan 66,367 152,048Prepaid Expenses 2,309,075 2,239,882Other Advances 1,926,499 4,301,941 1,912,563 4,304,493

TOTAL 10,376,038 10,761,291Of the above

Considered good 10,236,888 10,612,769Considered doubtful 139,150 148,522

10,376,038 10,761,291Less : Provision for doubtful loans and advances 139,150 148,522

TOTAL 10,236,888 10,612,769

(Figures in `)

Note : 2.21

REVENUE FROM OPERATIONS

Particulars For the year ended For the year endedon 31.03.2015 on 31.03.2014

Brokerage 84,694,803 33,807,495Securities Trading 617,564 626,318Depository Operations 7,765,109 4,870,030Delayed Payment Charges 16,249,156 3,387,321Other Services 1,781,155 4,115,227

TOTAL 111,107,787 46,806,391

(Figures in `)

Note : 2.20

OTHER CURRENT ASSETS


Interest Accrued but not dueOn Investment 7,841 129,641On Term Deposit with banks 1,251,075 1,258,916 2,046,046 2,175,687

TOTAL 1,258,916 2,175,687

253


Note : 2.22

OTHER INCOME


Interest Income [ Refer to Note : 2.22.1] 9,869,878 12,623,727Dividend Income [ Refer to Note : 2.22.2] 448,713 912,143Profit on sale of Long Term Investments (1,880,264) (879,463)Profit on sale of Current Investments 935,090 23,145Provision for doubtful debts written back 6,591,418 —Profit on disposal of fixed assets (90,182) —Other Non-operating Income 186,469 228,083

TOTAL 16,061,122 12,907,635

Note : 2.22.1


Interest IncomeOn Investments

Non-current Investments 65,516 2,456,890Current Investments 142,528 208,044 1,841,634 4,298,524

On Term Deposit with BanksNon-current 43,751 246,919Current 9,228,194 9,271,945 8,029,980 8,276,899

On Deposits with IL & FS Ltd. 389,889 48,304

9,869,878 12,623,727

(Figures in `)

(Figures in `)

(Figures in `)Note : 2.22.2


Dividend Income Trade Investment Non-current 448,371 892,883 Current 342 448,713 19,260 912,143

448,713 912,143

Note : 2.23

EMPLOYEE BENEFITS EXPENSES


Salaries, Allowances, Bonus, etc. [Refer to Note 2.27.9] 68,528,683 52,011,691Contribution to Provident and other funds[Refer to Note 2.27.9] 2,897,876 1,845,236Staff Welfare Expenses 3,432,465 2,399,498

TOTAL 74,859,024 56,256,425

(Figures in `)

254


Note : 2.24

FINANCE COSTS


Interest Expenses 3,054,644 1,463,359

TOTAL * 3,054,644 1,463,359

*Includes Commission on Bank Guarantee - 82,362/-

Note : 2.25

ADMINISTRATIVE AND OTHER EXPENSES


Rent and Lease Rent 8,842,564 8,446,067Electricity Charges 2,991,979 2,385,583Insurance 203,397 191,150Travelling and Conveyance 3,194,686 2,701,690Telephone and Postal Charges 4,736,444 4,040,383Vehicle Upkeep Charges 997,920 767,651Printing and Stationery 1,418,964 936,631Repairs and maintenance - others 2,929,511 2,920,850Legal and Professional Charges 736,787 719,848SEBI Fees 570,694 736,731Subbrokers' Fees 18,367,649 4,883,719Software License Charges 4,214,231 3,787,529Securities Transaction Tax 160,908 39,816Marketing and Business Promotion 621,566 173,314Transaction Charges 2,484,087 2,056,931Service Tax and Brokers' Note 2,300,896 1,177,631Directors' Sitting Fees 580,000 610,000Membership and Subscription 291,622 836,387Auditors' Remuneration Audit Fees 150,000 110,000

Certification Fees 75,750 225,750 88,500 198,500Bad Debt written off 5,753,624 —Provision for Doubtful Debts and Advances 516,253 2,765,047Other Expenses 1,299,588 948,675

TOTAL 63,439,120 41,324,133

(Figures in `)

(Figures in `)

Note : 2.26

EXCEPTIONAL ITEMS (Figures in `)

Earlier years' ESI Contribution — 2,368,487Recruitment Expenses — 1,261,250

TOTAL — 3,629,737


255


Note : 2.27

.01 The advance tax, tax deducted at source and provision for tax have been adjusted for the years for which tax assessmenthas been completed.

.02 The Company had incurred expenditure towards Development Fees in the assessment year 1996-97 for admissionto Calcutta Stock Exchange which was debited to revenue account. The Income Tax Authorities had treated this ascapital expenditure and this was confirmed by the Income Tax Appellate Tribunal by their Order No. 251/Cal/2000dated 08.02.2005. The amount of ` 31.31 lacs was determined by the Assessing Officer as Income Tax payable thereonwhich was deposited by the Company. However, the Company had filed an appeal against the same before the Hon'bleHigh Court at Calcutta, which is pending.

The Company had received a demand of ̀ 168,091/- under section 156 of the Income Tax Act, 1961 for the Assessmentyear 2004-05 in the Financial Year 2006-07 against which appeal had been filed before the Commissioner of IncomeTax (Appeals) Kolkata on 15.01.2007. The appeal was allowed by the Commissioner of Income Tax (Appeals) on17.04.2015. The effect of appeal is in process.

The Company had received a demand of ` 88,499/- under section 156 of the Income Tax Act, 1961 for the Assessmentyear 2005-06 in the Financial Year 2007-08 against which appeal had been filed before the Commissioner of IncomeTax (Appeals) Kolkata. However, the demand was adjusted by Income tax Authority against the refund of tax for theAssessment Year 2006-07. The matter was represented before CIT (Appeals)- XIV on 24.02.14 and a written submissionwas given by the company. The order for the same is awaited.

The company has received a demand u/s 156/143(3)/263/143(3) dt. 28.03.2014 for payment of ` 2,222,290/- fromDCIT-Cir-3, Kolkata for the Assessment Year 2008-09. The company has made an appeal to the CIT(Appeals) againstthe order of DCIT-Circle-3, Kolkata on 28.04.2014 followed by stay application on 29.04.2014 & 29.12.2014 againstcollection of above demand. The above appeal to CIT(Appeals) is in addition to appeal made to ITAT on 02.05.2013for order u/s 263 dt. 26.03.2013 for above Assessment Year. In the mean time, ` 1,082,320/- was deducted againstthe refund of A.Y. 2012-13 as part adjustment of above demand.

The Company had received a demand of ` 5.66 lacs and interest under the provisions of Section 68,75 & 76 of theFinance Act,1994 (Service Tax) for the Financial Year 2006-07 against which appeal had been filed before the Customs,Excise and Service Tax Appelate Tribunal. The matter was represented by the company before CESTAT, Kolkata on07.05.2014. CESTAT has given an order for pre deposit of ` 50,000/-(refundable) by the company within six weeks,considering the amount of tax demanded by the department. On receipt of such amount the CESTAT would reconsiderthe basis of calculation made by the company with that of adjudication order of the department given earlier andwould dispose matter accordingly.

.03 As the company's business activity falls mainly on a single primary business segment viz. dealing in Securities Marketsand allied activities and no other segment falls under 10% threshold limit and in a single geographical segment, thedisclosure requirements of Accounting Standard (AS - 17) " Segment Reporting" notified in Section 133 of the CompaniesAct, 2013 are not applicable.

.04 The Company has leased facility under non-cancelable operating lease.

The future lease payment in respect of the lease as at 31st March, 2015 is as under :

Minimum lease payment

2014-15 2013-14

(`) (`)

Not later than one year 431,840 1,099,200Later than one year and not later than five years 705,480 4,201,280Later than five years — 6,729,800Amount paid being minimum lease payment 451,080 1,632,215

General description of lease term :(i) Lease rentals are charged on the basis of agreed terms.(ii) Assets are taken on lease for a period of three to ten years

256


Note : 2.27

.05 Basic and Diluted Earnings per share ("EPS") computed in accordance with Accounting Standard - 20 is as under :

2014-15 2013-14

Profit after tax - `(Used as Numerator for calculation) (29,806,381) (47,380,040)

Number of Equity Shares at the beginning of the year 24,686,214 24,686,214

Number of Equity Shares at the end of the year 24,686,214 24,686,214

Weighted average number of Equity Share outstandingduring the year (used as denominator for calculation) 24,686,214 24,686,214Diluted Potential Equity Shares — —

Nominal value of Equity Shares – ` 10 10

Basic and diluted earnings per Share – ` (1.21) (1.92)

.06 Details of Stock - in - Trade comprising of Shares :

Particulars 2014-15 2013-14(`̀̀̀̀) (`)

Purchase/Transfer of Stock 3,433,965 13,140,979Less : Diminution in value 2,522 —Sales of Stock 3,438,970 13,548,300Change in inventories of Stock (16,520) 566,970Profit/(Loss) on Trading of Shares 24,047 (159,649)

.07 To the extent identified from the information available from suppliers of goods and services, there are no micro and smallenterprises being a supplier as defined under Micro, Small and Medium Enterprises Development Act, 2006.

.08 There is no impairment loss in terms of the Accounting Standard (AS) – 28 on “Impairment of Assets” notified in Section133 of the Companies Act, 2013.

.09 The disclosures required under Accounting Standard 15 “Employee Benefits” notified in Section 133 of the CompaniesAct, 2013:

Defined Contribution Plan

Employer’s Contribution to Provident Fund : ` 2,897,876 (Previous Year - ` 1,845,236)

Defined Benefit Plan

The employees’ gratuity fund scheme managed by Life Insurance Corporation of India is a defined benefit plan. Thepresent value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method.

Gratuity (Funded)a. Reconciliation of opening and closing balances of Defined Benefit Obligation

2014-15 2013-14(`̀̀̀̀) (`)

Defined Benefit obligation at beginning of the year 3,855,962 3,561,280Current Service Cost 912,368 665,450Interest Cost 423,062 331,019Actuarial Losses/(Gain) 419,935 (607,057)Benefits Paid (642,230) (94,730)

Defined Benefit obligation at year end 4,969,097 3,855,962

257


Note : 2.27

b. Reconciliation of opening and closing balances of fair value of plan assets

2014-15 2013-14(`̀̀̀̀) (`)

Fair value of Plan Assets at the beginning of the year 3,626,532 2,949,168Expected return on Plan Assets 276,138 235,215Actuarial Gain/(Losses) 65,494 54,718Contributions by Employer 444,946 482,161Benefits Paid (642,230) (94,730)

Fair value of Plan Assets at year end 3,770,880 3,626,532

c. Reconciliation of fair value of assets and obligations

31st March 2015 31st March 2014

Fair value of Plan Assets 3,770,880 3,626,532Present value of obligation 4,969,097 3,855,962

Amount recognized in Balance Sheet 1,198,217 229,430

d. Expenses recognised during the year

2014-15 2013-14

Current Service Cost 912,368 665,450Interest Cost 423,062 331,019Expected return on Plan Assets (276,138) (235,215)Actuarial (gain) / loss 354,441 (661,775)

Net Cost 1,413,733 99,479

e. Investment details % invested

31st March 2015 31st March 2014

LIC Group Gratuity (Cash Accumulation) Policy 100 100

f. Actuarial assumptions : Indian Assured Lives Mortality (2006 – 08) Ult Table

Year ended 31st March, 2015 31st March, 2014

Discount rate (per annum) 7.95% 9.25%Expected Rate of Return on Assets (per annum) 7.50% 7.50%Salary Escalation (per annum) 7.00% 7.00%

.10 The movement in provision for bad and doubtful debts/advances during the year is as follows :

Particulars 2014-15 (`) 2013-14 (`)

Opening Balance 9,932,818 7,167,771Add : Provision made 516,253 2,765,047Less : Bad debt written off against provision 5,591,967 —Less : Provision no longer required 999,452 —

Closing Balance 3,857,652 9,932,818

258


The above related party transactions are disclosed to the extent such parties have been identified by the management on thebasis of information available. This is relied upon by the Auditors.

.14 Figures of the previous year have been regrouped/rearranged wherever necessary to conform to the current year’spresentation.

Note : 2.27

.11 Capital Commitments

As on 31.03.2015 As on 31.03.2014

(`) (`)

Estimated amount of Contracts remaining to beexecuted on Capital Account and not provided for 119,400 189,575

.12 In the opinion of the management, the Current Assets, Loans and Advances have value on realization in the ordinary courseof business at least equal to the amount at which they are stated in the Balance Sheet unless otherwise stated.

.13 Related Party disclosures as required in terms of Accounting Standard (AS – 18) on Related Party disclosures notified inSection 133 of the Companies Act, 2013 are as under

i. Holding Company : The Peerless General Finance and Investment Co. Ltd.

ii. Subsidiary : Peerless Commodities Ltd.

iii. Fellow Subsidiaries : Peerless Hotels Ltd.Peerless Financial Products Distribution Ltd.Peerless Hospitex Hospital and Research Center Ltd.Peerless Fund Management Company Ltd.Peerless Trust Management Company Ltd.Peerless Financial Services Ltd.

iv. Associates : Bengal Peerless Housing Development Company Ltd.Kaizen Leisure & Holidays Ltd.Kaizen Hotels & Resorts Ltd.Peerless Mutual Fund (managed by Peerless Fund Management Company Ltd.)

v. Key Management Personnels : Mr. Jitendra Kumar Panda, Managing Director and CEOMr. Atul Kumar Bajpai, Wholetime DirectorMr. Abhishek Tantia, CFO (w.e.f. 11.09.2014)Mr. Sourabh Basu, Company Secretary (upto 31.12.2014)Mr. Dinesh Mourya, Company Secretary (w.e.f. 12.03.2015)

vi. The Company’s related party transactions during the year and outstanding balances as at 31st March, 2015 are asbelow :

Subsidiary and Key Management

Holding Company Fellow Subsidiaries Associates Personnels Total

2014-15 2013-14 2014-15 2013-14 2014-15 2013-14 2014-15 2013-14 2014-15 2013-14

Capital Paid — — — 493,000 — — — — — 493,000

Sale of Assets 75,359 — — — — — — — 75,359 —

Receiving of Services — — 81,461 - 571,939 993,812 — — 653,400 993,812

Reimbursement of expenses 2,548,837 2,085,686 201,017 479,543 — — — — 2,749,854 2,565,229

Remuneration — — — — — — 12,435,375 8,229,051 12,435,375 8,229,051

Rental Expenses 7,043,506 6,895,267 — — — — — — 7,043,506 6,895,267

Rendering of Services 1,095,224 970,137 187,437 359,865 457,004 295,510 — — 1,739,665 1,625,512

Balances as at year end

Receivable 4,147 18,403 — 250 7,402 — — — 11,549 18,653

Payable 219,777 208,633 — — — 78,217 — — 219,777 286,850

(Figures in `)

259


INDEPENDENT AUDITORS' REPORT

TO THE MEMBERS OF PEERLESS SECURITIES LIMITED

Report on the Consolidated Financial Statements

We have audited the accompanying consolidated financial statements of PEERLESS SECURITIES LIMITED(hereinafter referred to as “the Holding Company”) and its subsidiary (the Holding Company and its subsidiary togetherreferred to as “the group”), comprising of the Consolidated Balance Sheet as at March 31, 2015, the ConsolidatedStatement of Profit and Loss, the Consolidated Cash Flow Statement for the year then ended, and a summary ofthe significant accounting policies and other explanatory information (hereinafter referred to as “the consolidatedfinancial statements”).

Management’s Responsibility for the Consolidated Financial Statements

The Holding Company’s Board of Directors is responsible for the preparation of these consolidated financial statementsin terms of the requirements of the Companies Act,2013 (hereinafter referred to as “the Act”) that give a true andfair view of the consolidated financial position, consolidated financial performance and consolidated cash flows ofthe Group in accordance with the accounting principles generally accepted in India, including the Accounting Standardsspecified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. The respectiveBoard of Directors of the companies included in the Group are responsible for maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of the Group and for preventingand detecting frauds and other irregularities; the selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequateinternal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accountingrecords, relevant to the preparation and presentation of the financial statements that give a true and fair view andare free from material misstatement, whether due to fraud or error, which have been used for the purpose of preparationof the consolidated financial statements by the Directors of the Holding Company as aforesaid.

Auditors’ Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our audit. Whileconducting the audit, we have taken into account the provisions of the Act, the accounting and auditing standardsand matters which are required to be included in the audit report under the provisions of the Act and the Rules madethereunder.

We conducted our audit in accordance with the Standards of Auditing specified under Section 143(10) of the Act.Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether the consolidated financial statements are free of material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidatedfinancial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risksof material misstatement of the consolidated financial statements, whether due to fraud or error. In making thoserisk assessments, the auditor considers internal financial control relevant to the Holding Company’s preparation ofthe consolidated financial statements that give a true and fair view in order to design audit procedures that are appropriatein the circumstances, but not for the purpose for expressing an opinion on whether the Holding Company has anadequate internal financial controls system over financial reporting in place and the operating effectiveness of suchcontrols. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonablenessof the accounting estimates made by the Holding Company’s Board of Directors, as well as evaluating the overallpresentation of financial statements.

We believe that the audit evidence obtained by us and the audit evidence obtained by the other auditor in termsof its report referred to in sub-paragraph (a) of the Other Matters paragraph below, is sufficient and appropriateto provide a basis for our audit opinion on the consolidated financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid consolidatedfinancial statements give the information required by the Act in the manner so required and give a true and fair viewin conformity with the accounting principles generally accepted in India, of the consolidated state of affairs of theGroup as at March31, 2015, and its consolidated loss and its consolidated cash flows for the year ended on thatdate.

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Other Matter

We did not audit the financial statements of the subsidiary, whose financial statements reflect total assets (net) of` 369,566 as at 31st March, 2015, total revenues of ` 146,454 and net cash flows amounting to ` 70,563 for theyear ended on that date, as considered in the consolidated financial statements. These financial statements have beenaudited by other auditor whose report has been furnished to us by the Management and our opinion the consolidatedfinancial statements, in so far as it relates to the amounts and disclosures included in respect of the subsidiary, andour report in terms of sub-section (3) and (11) of Section 143 of the Act, in so far as it relates to the aforesaid subsidiary,is based solely on the report of the other auditor.

Our opinion on the consolidated financial statements, and our report on Other Legal and Regulatory Requirementsbelow, is not modified in respect of the above matters with respect to our reliance on the work done and the reportof the other auditor.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2015 (“the Order”), issued by the Central Governmentof India in terms of Section 143(11) of the Act, based on the comments in the auditors’ reports of the HoldingCompany and its Subsidiary Sompany, we give in the Annexure a statement on the matters specified in paragraphs3 and 4 of the order, to the extent applicable.

2. As required by Section 143(3) of the Act, we report that:

a. We have sought and obtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purpose of our audit of the consolidated financial statements;

b. In our opinion, proper books of account as required by law relating to preparation of the aforesaid consolidatedfinancial statements have been kept so far as it appears from our examination of those books and the reportof the other auditor;

c. The Consolidated Balance Sheet, the Consolidated Statement of Profit and Loss and the Consolidated CashFlow Statement dealt with by this report are in agreement with the relevant books of account maintainedfor the purpose of preparation of the consolidated financial statements;

d. In our opinion, the aforesaid consolidated financial statements comply with the Accounting Standards specifiedunder Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;

e. On the basis of the written representations received from the directors of the holding Company as on 31stMarch, 2015 taken on record by the Board of Directors of the Holding Company and the report of the statutoryauditor of its subsidiary company, none of the directors of the Group Companies is disqualified as on March31, 2015 from being appointed as a director in terms of Section 164(2) of the Act.

f. With respect to the other matters to be included in the Auditors’ Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and accordingto the explanations given to us:

i) The consolidated financial statements disclose the impact of pending litigations on the consolidated financialposition of the Group. Refer Note 2.27.2 to the consolidated financial statements;

ii) The Group did not have any material foreseeable losses on long-term contracts including derivativecontracts;

iii) There were no amounts which were required to be transferred to the Investor Education and Protection

Fund by the Holding Company and its subsidiary company.

For and on behalf ofDE & BOSE

Chartered AccountantsFirm Registration No. 302175E

Durgadas De Partner


Place : Kolkata

Date: 15th June, 2015

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Annexure to the Independent Auditors' Report

Referred to in Paragraph 3 under the heading of ‘Report on Other Legal and Regulatory Requirements’ section ofour report of even date.

Our reporting on the Order includes subsidiary company which has been audited by the other auditor and our reportin respect of the subsidiary is based solely on the report of other auditor, to the extent considered applicable forreporting under the Order in the case of the consolidated statements.

1.1 a. The Holding Company has maintained proper records showing full particulars including quantitative detailsand situations of its fixed assets. According to report of other auditor, the subsidiary company does nothave any fixed assets, therefore provisions of clause 3(i) of the Order are not applicable to the subsidiarycompany.

b. According to the information and explanations given to us, the fixed assets have been physically verifiedby the management in a phased periodical manner, which in our opinion, is reasonable having regardto the size of the Company and nature of its assets. No material discrepancies were noticed on such physicalverification.

1.2 a. For Holding Company, the securities held as stock in trade have been confirmed with the statement ofholding of depository at regular interval and at the end of year. In our opinion, the frequency of verificationof statement of holding is reasonable. According to report of other auditor, the subsidiary company hasno inventory and accordingly , the provisions of clause 3(ii) of the order are not applicable to the subsidiarycompany.

b. In our opinion and according to the information and explanations given to us, the procedure of confirmationof securities held as stock in trade followed by the Management are reasonable and adequate in relationto the size of the Holding Company and nature of its business.

c. In our opinion and according to the information and explanations given to us, the Holding Company hasmaintained proper records of securities held as stock in trade and as informed to us, no discrepancies havebeen noticed on verification of statement of holding and the book records.

1.3 The Holding Company and its subsidiary company have not granted any loans, secured or unsecured, tocompanies, firms or other parties covered in the register maintained under Section 189 of the Companies Act,2013.

1.4 In our opinion and the opinion of the other auditor and according to the information and explanations givento us, there are an adequate internal control system in the Holding Company and its subsidiary company,commensurate with the size of the respective entities and the nature of its business for the purchase of securities,fixed assets and sale of securities and services. During the course of our audit and the other auditor’s audit,no continuing failure to correct major weaknesses in such internal control system have not observed.

1.5 According to the information and explanations given to us, the Holding Company and its subsidiary companyhave not accepted any deposit from the public. Therefore, the provisions of clause (v) of paragraph 3 of theCARO 2015 are not applicable to the Company.

1.6 The Central Government has not prescribed the maintenance of cost records under Section 148(1)(d) of theAct for any of the services rendered by the Holding Company and its subsidiary company.

1.7 a. According to the records of the Holding Company and its subsidiary company, the Company is generallyregular in depositing the undisputed statutory dues including provident fund, employees’ state insurance,income tax, service tax and other material statutory dues as applicable with the appropriate authorities.According to the information and explanations given to us, no undisputed amounts payable in respectof the aforesaid dues were outstanding as at March 31, 2015 for a period of more than six months fromthe date of becoming payable.

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b. According to the information and explanations given to us and the records of the Holding Companyexamined by us, the details of statutory dues as on March 31, 2015 have not been deposited on accountof dispute as under :

Name of Nature of the Dues Forum where Amountthe Statue the dispute (Rs. in lacs)

is pending

Service Tax Service Tax Custom, Excise 5.66and Penalty and Service Tax

F.Y. 2006-07 Appellate Tribunal

Income Tax Income Tax Commissioner of 22.22Act, 1961 A.Y. 2008-09 Income Tax

U/s. 156/143(3)/ (Appeals)263/143(3)

c. There were no amounts which were required to be transferred to the Investor Education and ProtectionFund by the Holding Company and its subsidiary company.

1.8 The Group does not have accumulated losses more than fifty percent of its net worth at the end of the financialyear. The Group has incurred cash losses during the financial year covered by the audit and also in theimmediately preceding financial year.

1.9 According to the records of the Company examined by us and the information and explanation given to us,the Holding Company has not defaulted in repayment of dues to bank. The Holding Company has not obtainedany borrowings from any financial institution and debenture holders. According to the report of other auditor,the subsidiary company has not taken any loans from bank, financial institution and debenture holders.

1.10 According to the information and explanations given to us, the Holding Company and its subsidiary companyhave not given any guarantee for loans taken by others from banks or financial institutions.

1.11 According to the information and explanations given to us, only short term loans were raised by the HoldingCompany during the year and were applied for the purpose for which they were raised.

1.12 To the best of our knowledge and according to the information and explanations given to us and the other auditor,no fraud by and on the Holding Company and its subsidiary company has been noticed or reported duringthe year.

For and on behalf ofDE & BOSE

Chartered AccountantsFirm Registration No. 302175E

Durgadas De Partner


Place :Kolkata

Date: 15th June, 2015

263


CONSOLIDATED BALANCE SHEETAS AT 31ST MARCH, 2015

Note As at As at31st March, 2015 31st March, 2014` ` ` `

EQUITY AND LIABILITIES1. Shareholders’ Funds

(a) Share Capital 2.1 246,862,140 246,862,140(b) Reserves and Surplus 2.2 (15,025,500) 15,512,499

2. Minority Interest 4,981 4,035

3. Non-Current Liabilities(a) Long-term Provisions 2.3 1,198,217 229,430

4. Current Liabilities(a) Short-term borrowings

Loans 2.4 & 2.5 15,001,105 28,203,570Deposits 2.6 16,041,559 31,042,664 10,836,445 39,040,015

(b) Trade Payables 2.7 23,972,573 29,447,577(c) Other Current Liabilities 2.8 10,277,113 5,768,424(d) Short-term Provisions 2.9 1,292,658 1,765,007

299,624,846 338,629,127ASSETS

1. Non-Current Assets(a) Fixed Assets 2.10

(i) Tangible Assets 6,731,099 11,149,464(ii) Intangible Assets 1,488,924 8,220,023 1,421,767 12,571,231

(b) Non-Current Investments 2.11 30,349,285 64,363,979(c) Deferred Tax Assets (Net) 2.12 6,937,496 981,163(d) Long-term Loans and Advances 2.13 35,144,275 28,831,723(e) Other Non-Current Assets 2.14 500,000 20,007,309

2. Current Assets(a) Current Investments 2.15 975,000 2,042,000(b) Inventories 2.16 16,520 -(c) Trade Receivables 2.17 66,435,070 98,620,902(d) Cash and Cash Equivalents 2.18 139,549,869 98,415,410(e) Short-term loans and advances 2.19 10,236,888 10,618,170(f) Other Current Assets 2.20 1,260,420 2,177,240

299,624,846 338,629,127Significant Accounting Policies 1Notes on Financial Statements 2This is the Balance Sheet referred to in our report of even date.



Director & CEO

For & on behalf of DE & BOSE(Firm Registration No. 302175E)Chartered Accountants


Kolkata, 15th June 2015Dinesh Mourya

Company SecretaryAbhishek Tantia

Chief Financial Officer

264


CONSOLIDATED STATEMENT OF PROFIT AND LOSSFOR THE YEAR ENDED 31ST MARCH, 2015

Note Year ended Year ended31st March, 2015 31st March, 2014

` `

Revenue from Operations 2.21 111,245,687 46,914,271Other Income 2.22 16,069,676 12,909,188

TOTAL REVENUE 127,315,363 59,823,459

Expenses :Employee Benefits Expenses 2.23 74,859,024 56,256,425Finance Costs 2.24 3,054,644 1,463,359Administrative and Other expenses 2.25 63,471,270 41,739,535Depreciation and amortization expenses 2.10 5,776,872 4,228,793Provision for Diminution in value of Investment 2.11 15,467,472 (18,000)Diminution in value of Stock in Trade 2,522 —

TOTAL EXPENSES 162,631,804 103,670,112

Profit/(Loss) before Exceptional Items and Taxation (35,316,441) (43,846,653)Exceptional Items 2.26 — 3,629,737

Profit/(Loss) before Taxation (35,316,441) (47,476,390)

Tax Expense :Current Tax 21,780 5,747Deferred Tax 2.12 (5,599,387) 109,709

Profit/(Loss) for the year before Minority Interest (29,738,834) (47,591,846)Minority Interest 946 (2,965)

Profit/(Loss) for the year attributable tothe shareholders of the Company (29,739,780) (47,588,881)

Earnings per equity shares of Rs. 10/- each

Basic and Diluted Earnings per Share[Refer to Note : 2.27.04] (1.20) (1.93)

Significant Accounting Policies 1

Notes on Financial Statements 2

This is the Statement of Profit and Loss referred to in our report of even date.



Director & CEO






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FOR THE YEAR ENDED 31ST MARCH, 2015

2014-15 2013-14` `

A. CASH FLOW FROM OPERATING ACTIVITIES

Net Profit before Tax (35,316,441) (47,476,390)

Adjusted for :

Depreciation 5,776,872 4,228,793Diminution in value of Stock in Trade 2,522 —Diminution in value of Non-Current Investment 15,467,472 —Diminution in value of Current Investment — (18,000)Interest Income (9,878,432) (12,625,280)Dividend Income (448,713) (912,143)Interest Paid 2,972,282 1,463,359Provision for Doubtful Debts and Advances 516,253 2,765,047Bad Debt written off 5,753,624 —Loss on sale of Long Term Investments 1,880,264 879,463Profit on sale of Current Investments (935,090) (23,145)Provision for Doubtful Debts written back (6,591,418) —Loss on written off of Fixed Assets 90,182 —

14,605,818 (4,241,906)

Operating Profit before Working Capital Changes (20,710,623) (51,718,296)

Adjusted for :Trade and Other Receivables 26,651,045 (55,318,296)Inventories (19,042) 556,970Loans and Advances (863,091) 94,985Trade and Other Payables 4,602,278 26,172,484

30,371,190 (28,493,857)

Cash generated from/(used in) Operations 9,660,567 (80,212,153)

Tax paid (Net) (768,958) (3,893,625)

Net Cash from/(used in) Operating Activities 10,429,525 (76,318,528)

B. CASH FLOW FROM INVESTING ACTIVITIES

Purchase of Fixed Assets (2,926,370) (4,500,051)Proceeds from sale of fixed assets 255,359 —Purchase of Investments — (380,525)Proceeds from Sale of Investments 18,669,048 81,561,059Proceeds from maturity of Fixed Deposit with Bank 40,490,000 —Investment to Fixed Deposit with Bank (50,530,000) (6,275,593)Interest Income 10,806,968 17,080,579Dividend Income 448,713 912,143

Net Cash from Investing Activities 17,213,718 88,397,612

CONSOLIDATED CASH FLOW STATEMENT

266


CONSOLIDATED CASH FLOW STATEMENT (Contd.)



Director & CEO






2014-15 2013-14` `

C CASH FLOW FROM FINANCING ACTIVITIES

Proceeds from Minority Interest — 7,000Overdraft and Short Term Loan facility (13,202,465) 5,954,811Interest Paid (2,841,912) (1,463,359)Net Cash (used in)/from Financing Activities (16,044,377) 4,498,452

Net Increase in Cash and Cash Equivalents 11,598,866 16,577,536Cash and Cash Equivalents (Opening Balance) 27,855,410 11,277,874Cash and Cash Equivalents(Closing Balance) (Note - 1) 39,454,276 27,855,410

Note :

1. Cash and Cash Equivalents comprise :

Cash in hand 631,241 206,765

Bank Balance with schedule Banks :

In Current Account 38,823,035 27,648,645

39,454,276 27,855,410

This is the Cash Flow Statement referred to in our report of even date.

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NOTE : 1

SIGNIFICANT ACCOUNTING POLICIES

(A) Basis of preparation of financial statements

(i) The consolidated financial statements of the group have been prepared on historical cost basis and on the principleof a going concern. The Company follows mercantile system of accounting unless stated otherwise. The FinancialStatements have been prepared in accordance with the provisions of the Companies Act, 2013 and AccountingStandards as prescribed under section 133 of the said Act, read with rule 7 of the Companies (Accounts) Rule,2014 and other generally accepted accounting principles. The accounting policies have been consistently appliedby the Company and are consistent with those used in the previous year.

(ii) Incomes and Expenses are accounted for on accrual basis, provisions are made for all known liabilities and arebased on available information.

(iii) Brokerage and other income earned on secondary market operations is accounted on trade dates. Advisory services& related income are accounted on accrual basis. Depository income are accounted on cash basis due to uncertaintyof realization.

(iv) Income on account of interest is recognised on a time proportion basis taking into account the amount outstandingand the rate applicable and to the extent considered realisable.

(v) Income on account of dividend is recognised when the right to receive is established.

(vi) Claims and refunds whose recovery cannot be ascertained with reasonable certainty are accounted for as andwhen accepted and/or on actual receipt basis.

(B) Principles of Consolidation

Peerless Securities Limited (the “Company”) and its subsidiary constitute the “Group”. The consolidated financialstatements have been prepared on the following basis :

(i) The financial statements of the Company and its subsidiary are combined on a line–by–line basis by adding togetherthe book values of like items of assets, liabilities, income and expenses, after fully eliminating intra-group balancesand intra-group transactions in accordance with Accounting Standard (AS) 21 –“Consolidated Financial Statements”.

(ii) Minority Interest’s share of net profit of consolidated subsidiary for the year is identified and adjusted againstthe income of the group in order to arrive at the net income attributable to shareholders of the Company.

(iii) Minority Interest’s share of net assets of consolidate subsidiary is identified and presented in the consolidatedbalance sheet separate from liabilities and the equity of the Company.

(iv) As far as possible, the consolidated financial statements are prepared using uniform accounting policies for liketransactions and other events in similar circumstances and are presented in the same manner as the Company’sseparate financial statements.

(v) Details of the subsidiary whose assets, liabilities, income and expenses are included in the consolidation and theCompany’s holdings therein are as under :

Entity Proportion of Holding’s interest (%) Date of Incorporation

Peerless Commodities Limited 98.6 07/08/2013

(C) Use of Estimates

The preparation of financial statements requires estimates and assumptions that affect the reported amount of assets,liabilities, revenues and expenses and disclosure of contingent liabilities on the date of financial statements.

The difference between the actual results and estimates is recognised in the period in which the results are known/materialized.

(D) Other significant accounting policies :

These are set out under “Significant Accounting Policies” as given in the Company’s separate financial statements.

268


Note : 2.1

SHARE CAPITAL

As at 31.03.2015 As at 31.03.2014

Particulars Number Amount Number Amount

Authorised Capital

Equity Shares of Rs. 10/- each 25,000,000 250,000,000 25,000,000 250,000,000

250,000,000 250,000,000

Issued, Subscribed and Paid-up Capital

Equity Shares of Rs. 10/- eachAt the beginning and at the end of the year 24,686,214 246,862,140 24,686,214 246,862,140

246,862,140 246,862,140

NOTE : 2

NOTES ON FINANCIAL STATEMENTS FOR THE YEAR 31ST MARCH, 2015

(Amount in ̀ )

As at 31.03.2015 As at 31.03.2014

Name of the Holding Company Number Amount Number Amount

The Peerless General Finance & InvestmentCompany Ltd. 24,080,000 240,800,000 24,080,000 240,800,000

2.1.2. Disclosure of shares in the Company held by its holding company

As at 31.03.2015 As at 31.03.2014

Number of Number ofshares of the shares of the

Company Companyheld by the held by the

Name of the Shareholder shareholder % holding shareholder % holding

The Peerless General Finance & InvestmentCompany Ltd. 24,080,000 97.54% 24,080,000 97.54%

2.1.3. Details in respect of shares in the Company held by each shareholder holding more than 5% shares

(Amount in ̀ )

2.1.1. Rights, preferences and restrictions attached to equity sharesThe Equity Shares of the Company, having par value of `10 per share, rank pari passu in all respects including voting rightsand entitlement to dividend. The dividend proposed by the Board of Directors is subject to the approval of the shareholders inthe ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to recieve the remaining assets of theCompany, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity sharesheld by the shareholders.

269


As at 31.03.2015 As at 31.03.2014

Particulars Amount Amount Amount Amount

Securities Premium Account


General Reserve


Surplus as per the Statement of Profit and LossAt the beginning of the year (129,120,582) (81,531,701)

Adjustment on account of depreciation asper Schedule II of the Companies Act, 2013(net of deferred tax amounting to Rs.356,946)[Refer to Note 2.10] (798,219) —

Add: Loss for the year as per Statement ofProfit and Loss (29,739,780) (47,588,881)

At the end of the year (159,658,581) (129,120,582)

TOTAL (15,025,500) 15,512,499

(Figures in `)

Note : 2.2

RESERVES AND SURPLUS

NOTE : 2 (Contd.)


Provision for Employee Benefits – Gratuity 1,198,217 229,430

TOTAL 1,198,217 229,430

Note : 2.3

LONG TERM PROVISIONS (Figures in `)


Loan repayable on demand-Overdraft 1,105 28,203,570

TOTAL 1,105 28,203,570

Secured on lien of Fixed Deposits with Bank

Note : 2.4

LOANS FROM BANKS - Secured(Figures in `)

270



Margin Money - Clients 12,019,189 8,617,816Security Deposit - Subbrokers 3,475,020 2,172,810Security Deposit - Others 74,646 32,323Sundry Deposit 472,704 13,496

TOTAL 16,041,559 10,836,445

Note : 2.6

DEPOSITS (Figures in `)


Loan repayable on demand – Short Term Facility 15,000,000 —

TOTAL 15,000,000 —

Partly secured on lien of Fixed Deposits with Bank

Note : 2.5

LOANS FROM BANKS - Partly Secured (Figures in `)


Clients 22,971,070 28,521,568Others 1,001,503 926,009

TOTAL 23,972,573 29,447,577

Note : 2.7

TRADE PAYABLES (Figures in `)


Government Dues 1,212,861 490,902Sundry Creditors (Other than Micro,Small and Medium Enterprises) 9,064,252 5,200,702Others — 76,820

TOTAL 10,277,113 5,768,424

Note : 2.8

OTHER CURRENT LIABILITIES (Figures in `)

271



Provision for Employee Benefits – Leave Encashment 1,290,069 1,765,007

Provision for Taxation(Net of Advance Tax and Tax deducted at source) 2,589 —

TOTAL 1,292,658 1,765,007

Note : 2.9

SHORT TERM PROVISIONS (Figures in `)

Note : 2.10

TANGIBLE AND INTANGIBLE ASSETS

PARTICULARS GROSS CARRYING VALUE DEPRECIATION/AMORTISATION NET CARRYING VALUE

Adjustment

againstAs at Additions Disposal/ As at Up to For the Retained Disposal/ As at As at As at

1.4.2014 Adjustment 31.3.2015 31.3.2014 year Earnings Adjustment 31.3.2015 31.3.2015 31.3.2014

TANGIBLE ASSETS :

1. Furni ture and Fi t t ings 12,281,987 438,024 539,455 12,180,556 8,866,796 1,216,251 70,885 359,751 9,794,181 2,386,375 3,415,191

2. Motor Vehic les 3 ,011,475 — 629,057 2,382,418 2,095,920 242,285 60,434 533,902 1,864,737 517,681 915,555

3. Off ice Equipments 7 ,816,751 610,270 182,166 8,244,855 4,626,942 1,615,156 879,986 111,484 7,010,600 1,234,255 3,189,809

4. Computers and Data

Processing Units 12,528,290 1,259,461 — 13,787,751 8,899,381 2,151,722 143,860 — 11,194,963 2,592,788 3,628,909

SUB TOTAL (A) 35,638,503 2,307,755 1,350,678 36,595,580 24,489,039 5,225,414 1,155,165 1,005,137 29,864,481 6,731,099 11,149,464

INTANGIBLE ASSETS :

1. Computer Software * 7,213,179 618,615 — 7,831,794 5,791,412 551,458 — — 6,342,870 1,488,924 1,421,767

SUB TOTAL (B) 7,213,179 618,615 — 7,831,794 5,791,412 551,458 — — 6,342,870 1,488,924 1,421,767

TOTAL (A + B) 42,851,682 2,926,370 1,350,678 44,427,374 30,280,451 5,776,872 1,155,165 1,005,137 36,207,351 8,220,023 12,571,231

Previous Year 38,351,631 4,500,051 — 42,851,682 26,051,658 4,228,793 — — 30,280,451 12,571,231

* Other than internal ly generated.

In terms of Schedule I I of the Companies Act , 2013, the carry ing amount of the assets exis t ing as on 01/04/2014 has been deprec iated over the remaining l i fe of the assets .

Consequent upon the appl icat ion of Schedule I I as above, depreciat ion charge for the year i s h igher by ` 3 ,351,730/- . In respect of assets , where the remaining l i fe has

expired as on 1st Apr i l , 2014, the carry ing amount of ` 798,219 (net of deferred tax ` 356,946) has been fu l ly depreciated and has been adjusted against surplus

(accumulated losses) as at the beginning of the year .

(Figures in `)

272


Note : 2.11

NON-CURRENT INVESTMENTS

(Trade – Fully paid up)

A. Investment in Shares – Quoted

Name of the Company Face Value 31st March, 2015 31st March, 2014


The Calcutta Stock Exchange Ltd. * 1 250 250 250 250Aban Offshore Ltd. 2 300 258,240 800 688,640Andhra Bank 10 6,000 710,864 6,000 710,864Bharat Heavy Electricals Ltd. # 2 5,500 2,740,685 5,500 2,740,685Central Bank of India 10 8,000 1,487,801 8,000 1,487,801Crompton Greaves Ltd. # 2 13,000 4,077,850 13,000 4,077,850East India Hotels Ltd. # 2 38,000 4,856,701 40,500 5,203,188Housing Development and Infrastructure Ltd. 10 5,000 860,615 5,000 860,615Indiabulls Real Estate Ltd. 2 5,000 988,359 5,000 988,359Indiabulls Infrastructure and Power Ltd. 2 14,750 — 14,750 —IDBI Bank Ltd. # 10 13,500 2,164,979 13,500 2,164,979IFCI Ltd. 10 6,500 397,150 6,500 397,150IRB Infrastructure Developers Ltd. # 10 17,450 4,957,486 17,450 4,957,486JP Associates Ltd. # 2 14,000 1,684,470 14,000 1,684,470JSW Energy Ltd. # 10 26,987 2,929,842 29,987 3,324,843Larsen & Toubro Ltd. # 2 — — 1,700 1,916,697NIIT Ltd. 2 12,000 803,426 22,000 1,475,776Power Finance Corporation Ltd. # 10 1,250 313,188 11,050 3,127,534PTC India Ltd. 10 5,000 581,375 5,000 581,375Punj Lloyd Ltd. # 2 26,000 3,231,552 26,000 3,231,552Rural Eletrification Corporation Ltd. # 10 8,500 2,578,750 18,000 5,885,977Reliance Capital Ltd. # 10 2,000 1,446,471 2,000 1,446,471Reliance Industries Ltd. # 10 800 874,060 2,900 3,186,741Reliance Infrastructure Ltd. 10 2,400 2,617,565 2,950 3,246,505State Bank of India # 1 17,000 4,983,481 2,250 6,767,060Tata Steel Ltd. 10 700 271,597 1,500 697,900

45,816,757 60,850,768Less : Provision for Diminution in value of investment 15,467,472 —

30,349,285 60,850,768

# PARTLY OR FULLY PLEDGED WITH IL&FS LTD. ON 31.03.2014

Share of State Bank of India splitted 1:10 during the year

(Figures in `)

B. Investment in Debentures - Quoted


per debenture No. of Book Value No. of Book ValueDebentures Debentures

(Figures in `)

Tata Steel Ltd. 10.4% NCD 1,000,000 — 1 1,020,000Power Finance Corporation Ltd. 7.95% NCD 1,000,000 — 1 975,000

— 1,995,000

273


Note : 2.11 (Contd.)

C. Investment in Bonds - Quoted

Name of Bonds Nominal Value 31st March, 2015 31st March, 2014

per Bond No. of Book Value No. of Book ValueBonds Bonds

(Figures in `)

PGC Ltd. BOND, JULY 2015 1,250,000 — 1 1,112,500(6.1% Taxable 17/07 )

SBI BOND,MARCH 2021 10,000 — 40 405,711(9.75% Taxable)

— 1,518,211

TOTAL OF NON-CURRENT INVESTMENTS 30,349,285 64,363,979

Aggregate amount of Quoted Investments 45,816,507 64,363,729Aggregate amount of Unquoted Investments 250 250Aggregate amount of market value of Quoted Investments 30,917,618 36,541,835Aggregate provision for diminution in value of Investments 15,467,472 —

* denotes - not quoted

For basis of valuation, refer note 1(E)

Note : 2.12(Figures in `)DEFERRED TAX (NET)

Adjusted (Charge)/Particulars Closing as at against retained Credited Opening as at

31.03.2015 earnings to P&L 01.04.2014

Deferred Tax AssetProvision for Leave Encashment 398,631 — (146,756) 545,387Provision for Gratuity 370,249 — 299,355 70,894Provision for diminution in value of investment 4,779,449 — 4,779,449 —Preliminary Expenses 74,933 — (24,977) 99,910

5,623,262 — 4,907,071 716,191

Deferred Tax LiabilityDepreciation (1,314,234) 356,946 692,316 (264,972)

(1,314,234) 356,946 692,316 (264,972)

Net Deferred Tax Asset/(Liability) 6,937,496 981,163

Deferred Tax Credited to Statement of Profit and Loss 5,599,387

274


Note : 2.13(Figures in `)

(Figures in `)

(Figures in `)

Note : 2.15

CURRENT INVESTMENTS

(Trade - Fully Paid up)

Investment in Debentures - Quoted


per debenture No. of Value No. of Valuedebenture debenture

Power Finance Corporation Ltd. 1,000,000 1 975,000 —7.95% NCD 24FEB 2016

Tata Motors Finance Ltd. 500,000 — 4 2,042,00010.75% NCD 25MAR 2020

975,000 2,042,000

TOTAL OF CURRENT INVESTMENTS 975,000 2,042,000

Total market value of Current Investments 998,500 2,047,000

For basis of valuation, refer Note 1(E)

LONG TERM LOANS AND ADVANCES


Security Deposits withExchanges and Clearing Houses 31,610,411 25,763,455Depositories 1,500,000 1,500,000Others 1,251,981 1,436,279

34,362,392 28,699,734Other Loans and advances

Loan to Staff 7,182 56,414Prepaid Expenses 764,700 65,574Other Advances 10,001 781,883 10,001 131,989

TOTAL 35,144,275 28,831,723

Note : 2.14

OTHER NON-CURRENT ASSETS


Non-current bank balance [Refer to Note 2.18] 500,000 19,995,593Interest Accrued but not due on fixed deposits with banks — 11,716

TOTAL 500,000 20,007,309

275


(Figures in `)

Note : 2.16

INVENTORIES - Quoted

Name of the Company 31st March, 2015 31st March, 2014

No. of Value No. of ValueEquity Shares Equity Shares

Reliance Industries Ltd. 20 16,520 — —MSL Industries Ltd. 32,000 — 32,000 —Malanpur Steel Ltd. 233 — 233 —

TOTAL 16,520 —

For basis of valuation, refer note 1(F)

(Figures in `)

Note : 2.17

TRADE RECEVABLES

(Unsecured)


Outstanding for a period exceeding six monthsfrom the date they are due for payment Considered good 4,809,207 11,094,187 Considered doughtful 3,718,502 9,784,296

Others - Considered good 61,625,863 87,526,715

70,153,572 108,405,198Less : Provision for doubtful debts 3,718,502 9,784,296

66,435,070 98,620,902

Note : 2.18

CASH AND CASH EQUIVALENTS

Particulars Non-current Current

As at As at As at As at31.03.2015 31.03.2014 31.03.2015 31.03.2014

Balances with banks in current accounts — — 38,823,035 27,648,645Cash in Hand (including Stamps) — — 631,241 206,765

Other Balances with Banks :Fixed deposit under lien

Original maturity more than 12 months buthaving maturity period within 3 monthsfrom the reporting date — — 10,000,000 20,490,000Others 500,000 19,995,593 89,995,593 50,000,000Amount disclosed under non-current assets

[Refer note 2.14] (500,000) (19,995,593) — —

Fixed deposit with remaining maturity less than 12 months — — 100,000 70,000

TOTAL — — 139,549,869 98,415,410

(Figures in `)

276


(Figures in `)

Note : 2.19

SHORT TERM LOANS AND ADVANCES

(Unsecured)


Security Deposits - Others 252,859 47,298Advance Income Tax (including Tax Deducted at Source)[Net of provision] 5,276,867 6,065,016Tax Refundable 219,670 219,670Service Tax (Centvat Credit) 324,701 130,215Other Loans and Advances

Staff Loan 66,367 152,048Prepaid Expenses 2,309,075 2,239,882Other Advances 1,926,499 4,301,941 1,912,563 4,304,493

TOTAL 10,376,038 10,766,692Of the above

Considered good 10,236,888 10,618,170Considered doubtful 139,150 148,522

10,376,038 10,766,692Less : Provision for doubtful loans and advances 139,150 148,522

TOTAL 10,236,888 10,618,170

(Figures in `)

Note : 2.21

REVENUE FROM OPERATIONS


Brokerage 84,832,703 33,915,375Securities Trading 617,564 626,318Depository Operations 7,765,109 4,870,030Delayed Payment Charges 16,249,156 3,387,321Other Services 1,781,155 4,115,227

TOTAL 111,245,687 46,914,271

(Figures in `)

Note : 2.20

OTHER CURRENT ASSETS


Interest Accrued but not dueOn Investment 7,841 129,641On Term Deposit with banks 1,252,579 1,260,420 2,047,599 2,177,240

TOTAL 1,260,420 2,177,240

277


Note : 2.22

OTHER INCOME


Interest Income [Refer to Note : 2.22.1] 9,878,432 12,625,280Dividend Income [Refer to Note : 2.22.2] 448,713 912,143Profit on sale of Long Term Investments (1,880,264) (879,463)Profit on sale of Current Investments 935,090 23,145Provision for doubtful debts written back 6,591,418 —Profit on disposal of fixed assets (90,182) —Other Non-operating Income 186,469 228,083

TOTAL 16,069,676 12,909,188

Note : 2.22.1


Interest IncomeOn Investments

Non-current Investments 65,516 2,456,890Current Investments 142,528 208,044 1,841,634 4,298,524

On Term Deposit with BanksNon-current 43,751 246,919Current 9,236,748 9,280,499 8,031,533 8,278,452

On Deposits with IL & FS Ltd. 389,889 48,304

9,878,432 12,625,280

(Figures in `)

(Figures in `)

(Figures in `)Note : 2.22.2


Dividend Income Trade Investment Non current 448,371 892,883 Current 342 448,713 19,260 912,143

448,713 912,143

Note : 2.23

EMPLOYEE BENEFITS EXPENSES


Salaries, Allowances, Bonus, etc. 68,528,683 52,011,691Contribution to Provident and other funds 2,897,876 1,845,236Staff Welfare Expenses 3,432,465 2,399,498

TOTAL 74,859,024 56,256,425

(Figures in `)

278


Note : 2.24

FINANCE COSTS


Interest Expenses 3,054,644 1,463,359

TOTAL * 3,054,644 1,463,359

* Includes Commission on Bank Guarantee - 82,362/-

Note : 2.25

ADMINISTRATIVE AND OTHER EXPENSES


Rent and Lease Rent 8,842,564 8,446,067Electricity Charges 2,991,979 2,385,583Insurance 203,397 191,150Travelling and Conveyance 3,194,686 2,701,690Telephone and Postal Charges 4,736,444 4,040,383Vehicle Upkeep Charges 997,920 767,651Printing and Stationery 1,418,964 936,631Repairs and maintenance - others 2,929,511 2,920,850Legal and Professional Charges 747,462 719,848SEBI Fees 570,694 736,731Subbrokers' Fees 18,367,649 4,883,719Software License Charges 4,214,231 3,787,529Securities Transaction Tax 160,908 39,816Marketing and Business Promotion 621,566 173,314Transaction Charges 2,484,087 2,056,931Service Tax and Brokers' Note 2,300,896 1,177,631Directors' Sitting Fees 580,000 610,000Membership and Subscription 291,622 836,387Preliminary Expenses 404,166Auditors' Remuneration Audit Fees 160,000 120,000 Certification Fees 75,750 235,750 88,500 208,500Bad Debt written off 5,753,624 —Provision for Doubtful Debts and Advances 516,253 2,765,047Other Expenses 1,311,063 949,911

TOTAL 63,471,270 41,739,535

(Figures in `)

(Figures in `)

Note : 2.26

EXCEPTIONAL ITEMS (Figures in `)

Earlier years' ESI Contribution — 2,368,487Recruitment Expenses — 1,261,250

TOTAL — 3,629,737


279


Note : 2.27

.01 The advance tax, tax deducted at source and provision for tax have been adjusted for the years for which tax assessmenthas been completed.

.02 The Holding Company had incurred expenditure towards Development Fees in the assessment year 1996-97 for admissionto Calcutta Stock Exchange which was debited to revenue account. The Income Tax Authorities had treated this ascapital expenditure and this was confirmed by the Income Tax Appellate Tribunal by their Order No. 251/Cal/2000dated 08.02.2005. The amount of ` 31.31 lacs was determined by the Assessing Officer as Income Tax payable thereonwhich was deposited by the Holding Company. However, the Holding Company had filed an appeal against the samebefore the Hon'ble High Court at Calcutta, which is pending.

The Holding Company had received a demand of ` 168,091/- under section 156 of the Income Tax Act, 1961 forthe Assessment year 2004-05 in the Financial Year 2006-07 against which appeal had been filed before the Commissionerof Income Tax (Appeals) Kolkata on 15.01.2007. The appeal was allowed by the Commissioner of Income Tax (Appeals)on 17.04.2015. The effect of appeal is in process.

The Holding Company had received a demand of ` 88,499/- under section 156 of the Income Tax Act, 1961 forthe Assessment year 2005-06 in the Financial Year 2007-08 against which appeal had been filed before the Commissionerof Income Tax (Appeals) Kolkata. However, the demand was adjusted by Income tax Authority against the refundof tax for the Assessment Year 2006-07. The matter was represented before CIT(Appeals)-XIV on 24.02.14 and awritten submission was given by the company. The order for the same is awaited.

The Holding Company has received a demand u/s 156/143(3)/263/143(3) dt. 28.03.2014 for payment of` 2,222,290/- from DCIT-Cir- 3, Kolkata for the Assessment Year 2008-09.The Holding Company has made an appealto the CIT(Appeals) against the order of DCIT-Circle-3, Kolkata on 28.04.2014 followed by stay application on 29.04.2014& 29.12.2014 against collection of above demand. The above appeal to CIT(Appeals) is in addition to appeal madeto ITAT on 02.05.2013 for order u/s 263 dt. 26.03.2013 for above Assessment Year. In the mean time,` 1,082,320/- was deducted against the refund of A.Y. 2012-13 as part adjustment of above demand.

The Holding Company had received a demand of ` 5.66 lacs and interest under the provisions of Section 68,75 &76 of the Finance Act,1994 (Service Tax) for the Financial Year 2006-07 against which appeal had been filed beforethe Customs, Excise and Service Tax Appellate Tribunal. The matter was represented by the company before CESTAT,Kolkata on 07.05.2014. CESTAT has given an order for pre deposit of ` 50,000/-(refundable) by the company within six weeks, considering the amount of tax demanded by the department. On receipt of such amount the CESTATwould reconsider the basis of calculation made by the company with that of adjudication order of the departmentgiven earlier and would dispose matter accordingly.

.03 As the Holding Company and its subsidiary’s business activity falls mainly on a single primary business segment viz.dealing in Securities Markets and allied activities and no other segment falls under 10% threshold limit and in a singlegeographical segment, the disclosure requirements of Accounting Standard (AS - 17) "Segment Reporting" notified inSection 133 of the Companies Act, 2013 are not applicable.

.04 Basic and Diluted Earnings per share ("EPS") computed in accordance with Accounting Standard - 20 is as under :

2014-15 2013-14

Profit after tax – `(Used as Numerator for calculation) (29,739,780) (47,588,881)Number of Equity Shares at the beginning of the year 24,686,214 24,686,214Number of Equity Shares at the end of the year 24,686,214 24,686,214Weighted average number ofEquity Shares outstanding during the year(used as denominator for calculation) 24,686,214 24,686,214Diluted Potential Equity Shares — —Nominal value of Equity Shares – ` 10 10Basic and diluted earnings per Share – ` (1.20) (1.93)

280


Note : 2.27

.05 Details of Stock - in - Trade comprising of Shares :

Particulars 2014-15 2013-14(`̀̀̀̀) (`)

Purchase/Transfer of Stock 3,433,965 13,140,979Less : Diminution in value 2,522 —Sales of Stock 3,438,970 13,548,300Change in inventories of Stock (16,520) 566,970Profit/(Loss) on Trading of Shares 24,047 (159,649)

.06 To the extent identified from the information available from suppliers of goods and services, there are no micro and smallenterprises being a supplier as defined under Micro, Small and Medium Enterprises Development Act, 2006.

.07 There is no impairment loss in terms of the Accounting Standard (AS) – 28 on “Impairment of Assets” notified in Section133 of the Companies Act, 2013.

.08 The movement in provision for bad and doubtful debts/ advances during the year is as follows :

Particulars 2014-15 (`̀̀̀̀) 2013-14 (`̀̀̀̀)

Opening Balance 9,932,818 7,167,771Add : Provision made 516,253 2,765,047Less : Bad debt written off against provision 5,591,967 —Less : Provision no longer required 999,452 —Closing Balance 3,857,652 9,932,818

.09 In the opinion of the management, the Current Assets, Loans and Advances have value on realization in the ordinary courseof business at least equal to the amount at which they are stated in the Consolidated Balance Sheet unless otherwise stated.

.10 Related Party disclosures as required in terms of Accounting Standard (AS – 18 ) on Related Party disclosures notified inSection 133 of the Companies Act, 2013 are as under :

i. Holding Company : The Peerless General Finance and Investment Co. Ltd.

ii. Fellow Subsidiaries : Peerless Hotels Ltd.Peerless Financial Products Distribution Ltd.Peerless Hospitex Hospital and Research Center Ltd.Peerless Fund Management Company Ltd.Peerless Trust Management Company Ltd.Peerless Financial Services Ltd.

iii. Associates : Bengal Peerless Housing Development Company Ltd.Kaizen Leisure & Holidays Ltd.Kaizen Hotels & Resorts Ltd.Peerless Mutual Fund (managed by Peerless Fund Management Company Ltd.)

iv. Key Management Personnels : Mr. Jitendra Kumar Panda, Managing Director and CEOMr. Atul Kumar Bajpai, Wholetime DirectorMr. Abhishek Tantia, CFO (w.e.f. 11.09.2014)Mr. Sourabh Basu, Company Secretary (upto 31.12.2014)Mr. Dinesh Mourya, Company Secretary (w.e.f. 12.03.2015)

281


v. The Company’s related party transactions during the year and outstanding balances as at 31st March, 2015are as below :

Subsidiary and Key Management

Holding Company Fellow Subsidiaries Associates Personnels Total

2014-15 2013-14 2014-15 2013-14 2014-15 2013-14 2014-15 2013-14 2014-15 2013-14

Sale of Assets 75,359 — — — — — — — 75,359 —

Receiving of Services — — 81,461 — 571,939 993,812 — — 653,400 993,812

Reimbursement of expenses 2,548,837 2,085,686 201,017 84,602 — — — — 2,749,854 2,170,288

Remuneration — — — — — — 12,435,375 8,229,051 12,435,375 8,229,051

Rental Expenses 7,043,506 6,895,267 — — — — — — 7,043,506 6,895,267

Rendering of Services 1,095,224 970,137 187,437 359,865 457,004 295,510 — — 1,739,665 1,625,512

Balances as at year end

Receivable 4,147 18,403 — 250 7,402 — — — 11,549 18,653

Payable 219,777 208,633 — — — 78,217 — — 219,777 286,850

The above related party transactions are disclosed to the extent such parties have been identified by the management onthe basis of information available. This is relied upon by the Auditors.

.11 Figures of the previous year have been regrouped/rearranged wherever necessary to conform to the current year’spresentation. Previous year’s figure of the subsidiary are from 7th August, 2013 to 31st March, 2014 and hence, notstrictly comparable to the current year.

(Figures in `)

282


Form AOC-I

(Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 of Companies (Accounts) Rules,2014)

Statement containing salient features of the financial statement of

subsidiaries/associate companies/joint ventures

Part “A”: Subsidiaries

(Information in respect of each subsidiary to be presented with amounts in Rs.)

1. Sl. No. : 1

2. Name of the subsidiary: PEERLESS COMMODITIES LIMITED

3. Reporting period for the subsidiary concerned, if different from the holding company’s reporting period : N.A

4. Reporting currency and Exchange rate as on the last date of the relevant financial year in the case of foreignsubsidiaries.: N.A

5. Share capital: Rs. 5, 00,000

6. Reserves & surplus: Rs. (1,44,259)

7. Total assets : Rs. 3,69,566

8. Total Liabilities : Rs. 3,69,566

9. Investments : NIL

10. Turnover : Rs. 1,46,454

11. Profit before taxation: Rs. 1, 14,304

12. Provision for taxation : Rs. 46,757

13. Profit after taxation: Rs. 67,547

14. Proposed Dividend : NIL

15. % of shareholding: 98.6%

Notes: The following information shall be furnished at the end of the statement:

1. Names of subsidiaries which are yet to commence operations: N.A

2. Names of subsidiaries which have been liquidated or sold during the year: N.A

283


Part “B”: Associates and Joint Ventures

Statement pursuant to Section 129 (3) of the Companies Act, 2013 related to Associate Companiesand Joint Ventures

Name of Associates/Joint Ventures Name 1 Name 2 Name 3

1. Latest audited Balance Sheet Date Nil Nil Nil

2. Shares of Associate/Joint Ventures held by the Nil Nil Nilcompany on the year end

No. Nil Nil Nil

Amount of Investment in Associates/Joint Venture Nil Nil Nil

Extend of Holding % Nil Nil Nil

3. Description of how there is significant influence Nil Nil Nil

4. Reason why the associate/joint venture is not Nil Nil Nilconsolidated

5. Networth attributable to Shareholding as per Nil Nil Nillatest audited Balance Sheet

6. Profit/Loss for the year Nil Nil Nil

i. Considered in Consolidation Nil Nil Nil

i. Not Considered in Consolidation Nil Nil Nil

1. Names of associates or joint ventures which are yet to commence operations.

2. Names of associates or joint ventures which have been liquidated or sold during the year.

Note: This Form is to be certified in the same manner in which the Balance Sheet is to be certified.



Director & CEOKolkata, 15th June 2015



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