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EQUITY - MARKET SCREENER

Industrial Investment Trust Ltd
Industry :  Finance & Investments
BSE Code
ISIN Demat
Book Value()
501295
INE886A01014
148.5039616
NSE Symbol
P/E(TTM)
Mar.Cap( Cr.)
IITL
8.9
193.91
EPS(TTM)
Face Value()
Div & Yield %
9.66
10
0
 

As on: Dec 05, 2022 01:09 AM

Dear Shareholders,

Your Directors are pleased to present the Eighty Ninth Annual Report of the Company, together with the Audited Statements of Accounts for the year ended March 31, 2022.

Financial Performance

The summarized standalone and consolidated results of your Company and its subsidiaries are given in the table below.

Particulars Financial Year ended
Standalone Consolidated
31/03/2022 31/03/2021 31/03/2022 31/03/2021
Total Income 98,833.90 98,832.39 1,22,000.50 1,12,430.79
Profit/(loss) before Interest, Depreciation & Tax (EBITDA) 55,344.32 (1,318.55) 55,444.93 (5,521.46)
Finance Charges 2,546.67 1,552.02 2,336.38 1,307.43
Depreciation 9,344.05 6,685.74 9,754.97 7,040.38
Exceptional Items (10,39,500.00) - 7,16,505.58 -
Net Profit / (Loss) before tax for the year (9,96,046.40) (9,556.31) 3,56,314.93 (4,67,647.07)
Provision for Tax (including for earlier years) / Deferred Tax (15.28) 122.03 1,718.04 214.75
Share in Profit / (Loss) for Associate/Joint Ventures for the year (4,03,627.38) (4,53,777.78)
Net Profit/(Loss) After Tax (9,96,031.12) (9,678.34) 3,54,596.89 (4,67,861.83)
Other comprehensive income for the year 1,168.50 312.01 (1,235.00) (1,318.15)
Total Comprehensive income for the year (9,94,862.62) (9,366.33) 3,55,831.89 (4,66,543.68)
Profit/(Loss) brought forward from previous year (8,00,800.63) (7,91,434.30) (22,40,759.71) (18,21,312.64)
Share in Profit / (Loss) Attributable to Minority interest

-

-

30,134.11 (47,376.76)
- Other Comprehensive income/ (expenses) attributable

-

-

(1,235.00) (1,318.15)
Items of other comprehensive income recognized directly in retained earnings:
- Remeasurements of post employment benefit obligation, net of tax 1,229.08 1,037.97
Profit / (Loss) carried to Balance Sheet (17,95,663.25) (8,00,800.63) (19,15,067.85) (22,40,759.71)
From this, the Directors have transferred to:
Special Reserve - - - -
General Reserve - - - -
Capital Redemption Reserve - - - -
Leaving a balance to be carried forward (17,95,663.25) (8,00,800.63) (19,15,067.85) (22,40,759.71)

* includes impact on new Indian Accounting Standard application.

Previous year figures have been regrouped / rearranged wherever necessary.

Indian Accounting Standards

The Company has adopted Indian Accounting Standards (IND AS) from the FY 2018-19 and has replaced the existing Indian GAAP prescribed under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014.

Results of operations and state of Company's affairs

During the year, the Company has incurred pre-tax Loss of Rs 9960.46 lakhs as compared to pre-tax loss of Rs 95.56 lakhs in the previous year. The Revenue from operations during the year was Rs 940.47 lakhs as compared to Rs 970.58 lakhs in the previous year. During the year, the Company sold equity investment of FGILICL, incurring a loss of Rs 10,395.00 lakhs.

The income on preference shares amortization is Rs 617.03 lakhs compared to previous year of Rs 571.49 lakhs in line with guidelines on Ind AS implementation. The Company has provided loss on fair value changes during the year amounting to Rs 262.69 lakhs as compared to Rs 586.37 lakhs in the previous year. The interest income is of Rs 318.24 lakhs (which comprises of interest on loans of Rs 179.67 lakhs and interest on deposits with banks of Rs 138.57 lakhs) as compared to previous year interest income of Rs 398.30 lakhs (which comprises of interest on loans of Rs 259.94 lakhs and interest on deposits with banks of Rs 138.36 lakhs).

The Reserve Bank of India (RBI) vide its Letter dated June 25, 2018 has prohibited the Company from expanding its credit / investment portfolio other than investment in Government Securities till Net NPAs are brought down to below 5%. The Company submits the action plan to RBI on the status of NPAs and recoveries from time to time.

The management is exploring options to monetize Non Performing Investment / Assets of the Company. Every effort is taken to reduce the NPAs.

Business Overview

The Company is registered with Reserve Bank of India (RBI) as a Non-Deposit taking Non- Banking Financial Company (NBFC). It is a 'Systemically Important Non-Deposit taking NBFC'. It is primarily a Holding Company, holding investments in its subsidiaries and other group Companies and joint ventures. The activities of the Company comprises of Investment in equity shares quoted as well as unquoted, units of mutual funds, Fixed deposits with renowned Banks, Inter-Corporate Deposits and Loans to its Group Companies / entities. The Committee of Investments / Loans and Risk Management is entrusted with the power to make investments and grant loans and the Board of Directors is apprised of the investments of the Company and monitors the deployment of resources on regular basis.

The details of the Company's investments and analysis of securities held are given in Note 7 to the Balance Sheet as on March 31, 2022. The loans to subsidiaries and other entities within the group and interest income are disclosed in Note 6 and Note 20 to the Balance Sheet and Statement of Profit and Loss respectively as on March 31, 2022.

During the first half of the Financial Year 2021-2022 COVID-19 Pandemic continued to spread globally including India resulting in significant volatility in financial markets and decrease in activities. Real Estate and hospitality business were the most hard hit.

Major portion of the loans granted to the group companies are in the business of real estate. However the sector has been facing trouble from last few years but the impact of Coronavirus on the Indian real estate sector brought property transactions to a near-halt.

The Company derives major source of revenue from the interest income on the loans granted to various group companies and joint ventures of the subsidiary companies. Some of these loans have become NPAs on account of non-repayment of loan as well as default in servicing their interest obligations. In compliance with RBI guidelines, the Company is also required to make provisions on said loans which have further impacted the financials of the company, its performance and profitability.

Your management has assessed the potential impact of the COVID-19 global pandemic on the Company and based on the current assessment, they consider that there will be no foreseeable material impact on the operations of the Company and the carrying value of assets and liabilities.

Material changes and commitments occurred after the close of the financial year till date of this report which affects the financial position of the Company

a) One Time Settlement of Loan with IITL-Nimbus The Express Park View (EPV II): The Company had granted an unsecured loan amounting to Rs 23.19 crores for its business purpose to EPV II in various branches between 2013 - 2016. EPV II was regular in servicing its interest obligation upto September 30, 2015.

The Shareholders of the Company, at their Annual General Meeting held on September 23, 2017, had accorded their consent by an Ordinary Resolution to the Board of Directors for Restructuring of Unsecured Loan of Rs 23,19,87,365/- granted to EPV II along with interest thereon by grant of Moratorium of four years.

The total outstanding loan (including funded interest term loan of Rs 1,57,64,090/-) as on date is Rs 24,77,51,455/-.

Due to sluggish project sales, unsold inventory and paucity of funds, the Firm has not been able to repay the loan and interest and have proposed the following terms for one time settlement of the outstanding loan (including FITL) totaling to INR 24.77 crores:

1. To waive the total outstanding interest amount of Rs 14,11,57,242/- as on June 30, 2022 and all future interest amount thereafter upto December 31,2022.

2. The Firm will repay the outstanding loan on or before December 31, 2022.

3. The Firm reiterates their commitment to remit the outstanding loan amount.

4. In the unlikely scenario of the amount not being remitted by December 31,2022, the Firm will without any further request or extension, transfer the flats of equivalent of outstanding loan amount, with completion certificates obtained and facilitate registration of the same. In such eventuality, no maintenance charges will be levied on the flats until the time they are sold or for a period of 12 months ending December 31, 2023 whichever is earlier.

The said proposal is being placed at the ensuing Annual General Meeting for the approval of the shareholders.

b) One Time Settlement of Loan with IITL Nimbus The Hyde Park, Noida: IITL Nimbus The Hyde Park, Noida had availed a total loan of Rs.36.50 crores in various tranches between 2013 - 2017. The total outstanding loan as on date is '16,27,94,964/-

Due to sluggish project sales, unsold inventory and paucity of funds, the Firm has not been able to repay the loan and interest and have proposed the following terms for one time settlement of the outstanding loan of '16,27,94,964:

1. To waive the total outstanding interest amount of Rs 2,63,71,000/- as on June 30, 2022 and all future interest amount thereafter upto December 31, 2022.

2. The Firm will repay the outstanding loan on or before December 31, 2022.

3. The Firm reiterates their commitment to remit the outstanding loan amount.

4. In the unlikely scenario of the amount not being remitted by December 31, 2022, the Firm will without any further request or extension, transfer the flats of equivalent of outstanding loan amount, with completion certificates obtained and facilitate registration of the same. In such eventuality, no maintenance charges will be levied on the flats until the time they are sold or for a period of 12 months ending December 31,2023 whichever is earlier.

The said proposal is being placed at the ensuing Annual General Meeting for the approval of the shareholders.

Dividend

In view of losses incurred by the Company, your Directors have not recommended any dividend for the financial year 2021-2022.

Management Discussion and Analysis

Management Discussion and Analysis comprising an overview of the financial results, operations / performance and the future prospects of the Company forms part of this Annual Report.

Change in Capital Structure

During the year, the Company has not issued any shares or convertible securities. The Company does not have any Scheme for issue of shares including sweat equity to the employees or Directors of the Company.

As on March 31, 2022, the issued, subscribed and paid up share capital of your Company stood at Rs 22,54,75,500/-, comprising 2,25,47,550 Equity Shares of Rs 10/- each.

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on March 31, 2022 is available on the Company's website on http://www.iitlgroup.com/newStatic/Reports/ Annual_Return-2021-2022.pdf

Compliance with Secretarial Standards

The Board of Directors affirm that the Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India (SS1 and SS2 respectively) relating to Meetings of the Board and its Committees which have mandatory application.

Consolidated Accounts

The Consolidated Financial Statements of your Company for the financial year 2021-22, are prepared in compliance with applicable provisions of the Companies Act, 2013, Accounting Standards and the Listing Regulations. The Consolidated Financial Statements have been prepared on the basis of audited financial statements of the Company, its subsidiaries, associate and joint venture companies, as approved by their respective Board of Directors.

Subsidiary, Associate and Joint Venture Companies

Pursuant to sub-section (3) of Section 129 of the Act, the statement containing the salient features of the financial statement of company's subsidiaries, associate and joint venture Companies is given as Annexure 1.

Brief particulars about the business of each of the Subsidiaries and Joint Venture / Associate Companies is given hereunder:-

Subsidiary Companies:

a. IIT Investrust Limited (IITIL)

The subsidiary company, IITIL was into Stock Broking and Depository business. In June 2019, IITIL had applied for Surrender of membership of Stock Broking business and Depository Participant. BSE and SEBI granted approvals for surrender. Upon Surrender of Stock Broking License and License as Depository Participant, the subsidiary company ceased to be the Stock Broker as well as Depository Participant. Besides that, IITIL also provides Advisory and Consultancy services to various Body Corporates, if required from time to time.

The total income of the Company for the year ended on March 31,2022 is Rs 115.23 lakhs as compared to Rs 101.94 lakhs in the previous year. The pre-tax profit for the year ended March 31, 2022 is Rs 16.23 lakhs as against the pre-tax profit of Rs 27.17 lakhs for the preceding year.

b. IITL Projects Limited - (IITLPL)

IITLPL is listed on BSE Limited.

IITLPL is engaged in Real Estate business, construction of residential complex in the National Capital Region (NCR). It has acquired a plot of land on long term lease, under Builders Residential Scheme (BRS) of the Greater Noida Industrial Development Authority (GNIDA).

Apart from constructing its own project, IITLPL is also engaged in construction of residential flats through Special Purpose Vehicles (SPVs) and these SPVs have been allotted plots of land on long term lease, under Builders Residential Scheme (BRS) of the New Okhala Industrial Development Authority (NOIDA) and Yamuna Expressway Authority (YEA). The total lease hold area allotted to the Company alongwith SPVs is around 2,65,000 sq. meters and the projects are under various stages of construction.

Projects developed by the Company:

Express Park View I: This project is completed and most of the flats have been allotted to the buyers.

Projects being developed by the Company jointly with SPVs:

1) The Hyde Park

2) The Golden Palms

3) Express Park View-II:

The firm has obtained completion certificate for 7 of the 10 towers under construction in Phase I.

It is also constructing a commercial complex containing of 39 units, in Phase II.

The Firm has presently undertaken construction of low rise apartments, as Phase III, under the name and style of THE EXPRESS PARK VIEW-II LOW RISE APARTMENTS". It is proposed to construct 310 flats in 16 towers (G+4). The RERA registration is complete and the construction work has just begun.

4) The Golden Palm Village:

Yamuna Expressway Industrial Development Authority ("YEIDA") vide letter no. Patrank-Y.E.I/Builders/628/2021 dated July 28, 2021, directed the Firm to deposit a lease rent of INR 4,82,20,627.06 (INR Four Crore Eighty Two Lakhs Twenty Thousand Six Hundred Twenty Seven and Paise Six only) on or before 31.07.2021 in order to initiate the process of execution of surrender deed.

On July 30, 2021, Firm deposited the lease rent demanded by YEIDA and on 30.11.2021 executed surrender deed for partial surrender of land and fresh allotment of 55152 Sq. Mtrs land (out of 1,02,995.70 sq.mtrs. land held by the firm) under Project Settlement Policy which was in proportion to payment made by the firm.

The total Income of IITL Projects for the year ended on March 31, 2022 is Rs 1,971.10 lakhs as compared to Rs 43.96 lakhs in the previous year. Increase in income is on account of share of profit of Rs 1848.15 lakhs due to reversal of land cost for partial surrender of project land of the Joint Venture, IITL Nimbus The Palm Village. On consolidation basis the income of the Company increased to Rs 122.95 lakhs as compared to Rs 43.96 lakhs in the previous year and profit accounted to Rs 1,065.75 lakhs in the current year as compared to previous year loss Rs 1,677.42 lakhs

c. IITL Management and Consultancy Private Limited (formerly known as IIT Insurance Broking and Risk Management Private Limited)

The subsidiary company, IIT Insurance Broking and Risk Management Private Limited (IIT Insurance) was in the business of Direct Insurance Broking (Life and Non-Life). During the year 2019-20, IIT Insurance had made an application to Insurance Regulatory and Development Authority of India (IRDAI) for voluntary surrender of the Broking License (Life and Non-Life).

IRDAI vide its letter dated June 17, 2021 granted approval for voluntary surrender of Certificate of Registration and advised the Company to submit copy of certificate issued by Registrar of Companies (ROC) after making required changes for deletion of Main Object of Memorandum of Association and change of name of the Company.

Subsequently, IIT Insurance changed its name to IITL Management and Consultancy Private Limited and also changed its Object Clause. The same were approved by Ministry of Corporate Affairs. The said Certificates received from Ministry of Corporate Affairs were sent to IRDAI. IRDAI granted approval to the application of Surrender of Certificate of Registration (COR) of Broking License of the company. Consequent to this, IIT Insurance ceased to be an Insurance Broker.

The Company's revenue of operations for the financial year ended March 31, 2022 is Rs 8.48 lakhs comprising Interest on Bank Deposits of Rs 8,11,710/- and Brokerage Income of Rs.35,930/- as compared to the revenue of Rs 9.49 lakhs during the previous year. The pre-tax profit for the year ended March 31, 2022 is Rs 4.61 lakhs as against the pre-tax profit of Rs 1.30 lakhs for the preceding year.

d. IITL Corporate Insurance Services Private Limited (IITL Corporate Insurance)

IITL Corporate Insurance Services Private Limited (IITL Corporate Insurance) had withdrawn the application for undertaking the business of Corporate Agency. Subsequent to that, it did not commence any business. In January 2020, IITL Corporate Insurance had filed application under section 248 of Companies Act 2013 with Ministry of Corporate Affairs for removal of its name from the Register of Members. The subsidiary Company received an Intimation letter from Ministry of Corporate Affairs that the name of IITL Corporate Insurance Services Private Limited has been struck off from the Register of Companies w.e.f. August 23, 2021 and the Company stands dissolved.

Joint Venture / Associate Companies:

a. Future Generali India Life Insurance Company Limited (FGILICL), a Joint Venture:

In the year 2013, the Company had made an investment of Rs 340 Crores in Future Generali India Life Insurance Company Limited to acquire 22.5% of its equity capital. Subsequent to the acquisition, FGILICL became a joint venture of the Company.

FGILICL made several Rights Issues. The Company did not participate in any of the Rights Issue, due to which the company's stake reduced to 16.62%. Since couple of years, the Company had been exploring to divest its stake in FGILICL. In December 2021, the Company received offer from Generali Participations Netherlands N.V (Generali), one of the Joint Venture partners of FGILICL, to acquire Equity holding of 16.62% (equivalent to 32,67,00,000 equity shares) at a total consideration of Rs 225 crores. On December 18, 2021, the Company entered into Share Purchase Agreement with Generali. The said transaction was subject to the approval of Insurance Regulatory and Development Authority of India (IRDAI), Registrar of Companies, Competition Commission of India (CCI), Reserve Bank of India, Shareholders of the Company in general meeting / postal ballot and all other Statutory / Regulatory authorities as may be required.

Upon receiving approval from all authorities and shareholders, the transaction was consummated on March 28, 2022.

b. World Resorts Limited (WRL), an Associate Company:

WRL is into the business of hospitality and owns and operates a Deluxe Five Star Resort by the name "Golden Palms Hotel & Spa", Off. Tumkur Road, Bangalore.

The hospitality industry has perhaps been most hard-hit by COVID-19. The lockdown to contain spread of COVID-19 in the country has had disastrous impact on the hospitality sector, particularly for hotels and hoteliers. The hotels are businesses that are very capital intensive and even have very high fixed costs. The associate company has incurred immense losses during last two years on account of COVID-19.

Internal financial controls and their adequacy

The Board has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Company's policies, the safeguarding of its assets, the prevention and detection of fraud, error reporting mechanisms, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.

M/s Sheetal Patankar & Co., Chartered Accountants, a consulting / audit firm were appointed for determining the adequacy and operating effectiveness of the existing Internal Financial Controls over Financial Reporting of the Company on behalf of the management.

They have observed that there are no material weaknesses in the financial controls of the Company. Based on the above, management believes that adequate internal financial controls exist in relation to its Financial Statements. The operating staff are complying with the requirements.

Directors and Key Managerial Personnel

There was no change in Directorship during the year under review.

As on date, Dr. B. Samal, Mr. Bipin Agarwal, Mr. Venkatesan Narayanan, Mr. Milind Desai, Ms. Sujata Chattopadhyay and Mr. Shankar Narayan Mokashi are the Directors of the Company.

Re-appointment of Director retiring by rotation

In terms of the provisions of the Act, Dr. B. Samal, Director retires by rotation at the ensuing Annual General Meeting and being eligible, seeks re-appointment.

The necessary resolution for re-appointment of Dr. B. Samal forms part of the Notice convening the Annual General Meeting scheduled to be held on September 24, 2022. The profile and particulars of experience that qualify Dr. Samal for Board membership, are disclosed in the said Notice.

Key Managerial Personnel

In terms of Section 203 of the Act, the Key Managerial Personnel of the Company are Dr. B. Samal, Executive Chairman, Mrs. Cumi Banerjee, Chief Executive Officer and Company Secretary and Mr. Kamlesh Kumar Agrawal, Group Chief Financial Officer.

Familiarisation Programme

The Company conducts suitable familiarisation programme for Independent Directors so as to associate themselves with the nature of the industry in which the Company operates and business model of the Company in addition to regular presentations on financial statements and other relevant data. In addition to the above, Directors are periodically advised about the changes effected in the Corporate Law, Listing regulations and RBI regulations with regard to their roles, rights and responsibilities as Directors of the Company.

The details of the familiarisation programme have been disclosed and updated from time to time on the Company's website and its weblink is http://www.iitlgroup.com/newStatic/AboutUs.aspx.

Meetings of the Board

Seven meetings of the Board of Directors were held during the year. For further details, please refer Report on Corporate Governance.

Directors' Responsibility Statement

Pursuant to Section 134(3)(c) of the Companies Act, 2013, your Directors, to the best of their knowledge and belief, make following statements that:

(a) In preparation of the annual accounts for the year ended March 31,2022, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;

(b) Such accounting policies have been selected and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at March 31, 2022 and loss of the Company for the year ended on that date;

(c) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) The annual accounts have been prepared on a going concern basis;

(e) The proper internal financial controls were in place and that such internal financial controls are adequate and were operating effectively;

(f) The systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.

Corporate Governance

Your Company has been practicing the principles of good Corporate Governance over the years and it is a continuous and ongoing process. A detailed Report on Corporate Governance practices followed by your Company as prescribed by SEBI in Chapter IV read with Schedule V of Listing Regulations together with a Certificate from M/s Chandanbala Jain & Associates, Practicing Company Secretaries confirming compliance with the conditions of Corporate Governance are provided separately in this Annual Report.

Declaration by Independent Directors

The Company has received declarations from all the Independent Directors of the Company, confirming that, they meet the criteria of independence as prescribed both under Section 149(7) of the Companies Act, 2013 and Regulation 16(b) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. Further, the Independent Directors of the Company have registered themselves with Indian Institute of Corporate Affairs for empanelment in the databank of Independent Directors.

Policy on appointment and remuneration for Directors, Key Managerial Personnel and senior management employees

The Board of the Directors has framed the policy which lays down a framework in relation to Remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. This policy also lays down criteria for selection and appointment of Board Members. The Nomination and Remuneration Policy is uploaded on the Company's weblink viz. http://www.iitlgroup.com/newStatic/ Nomination_Remuneration_Policy.pdf.

Related Party Transactions

The Company has laid down a Related Party Transaction (RPT) Policy for purpose of identification and monitoring of such transactions. The policy on Related Party Transaction as approved by the Board is uploaded on the Company's weblink viz. http://www. iitlgroup.com/newStatic/Related_Party_Transaction_Policy.pdf

All Related Party Transactions are placed before the Audit Committee and also the Members / Board for their approval, wherever necessary.

The details of the related party transactions as per Indian Accounting Standard 24 are set out in Note 36 to the Standalone Financial Statements forming part of this report.

All RPTs entered during the financial year by the Company are in ordinary course of business and on an arms' length basis. Particulars of material contracts or arrangements made with related parties referred to in Section 188(1) of the Companies Act, 2013,

in the prescribed Form AOC-2, is appended as Annexure 2 to the Directors' Report.

Corporate Social Responsibility (CSR)

The Corporate Social Responsibility Committee has formulated and recommended to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, which has been approved by the Board.

The CSR Policy is disclosed on the Company's website

http://www. iitlgroup.com/newStatic/Corporate_Social_Responsibility_Policy. pdf

The provisions relating to CSR enumerated under Section 135 of the Companies Act, 2013 are not applicable to the Company during the year under review. Hence, the Annual Report on CSR is not attached to this Report.

Secretarial Audit

Pursuant to provisions of Section 204 of the Companies Act, 2013 and rules made thereunder, the Company has appointed M/s. Chandanbala Jain & Associates, Practicing Company Secretaries (CP No. 6400), to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is included as Annexure 3 and forms an integral part of this report. The Secretarial Audit Report does not contain any qualifications or reservations. The observations made in the report are self-explanatory.

Annual Secretarial Compliance Report

M/s. Chandanbala Jain & Associates, Practicing Company Secretaries (CP No. 6400) have submitted Annual Secretarial Compliance Report for the financial year 2021-22 for all applicable compliances as per Securities and Exchange Board of India Regulations and Circulars / Guidelines issued thereunder and the same was submitted to stock exchanges within the permissible time limit.

Particulars of Loans given, Investments made, Guarantees given and Securities provided

The provisions of Section 186 of the Act pertaining to investment and lending activities is not applicable to the Company, since the Company is a Non-Banking Financial Company whose principal business is acquisition of securities.

Details of guarantees and/or security in connection with loans to other bodies corporates or persons as covered under the provisions of Section 186 of the Act, are given in the Notes to the Financial Statements.

Capital Adequacy Ratio

Your Company's Capital to Risk Assets Ratio (CRAR) calculated in line with Non-Banking Financial (Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007 ("RBI Directions") stood at 716.02% above the regulatory minimum of 15%. Your Company's asset size is Rs 322.03 crores. The Company has received a certificate from the Auditors of the Company, Chaturvedi & Shah LLP, Chartered Accountants, pursuant to Non-Banking Financial Companies Auditors' Report

(Reserve Bank of India) Directions, 2008 confirming compliance of the conditions with respect to Systemically Important Non-Deposit taking Non-Banking Financial Companies.

Conservation of energy, technology absorption, foreign exchange earnings and outgo:

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows:

(A) Conservation of energy: Not Applicable

(B) Technology absorption: Not Applicable

(C) Foreign exchange earnings and Outgo: During the year under review, the Company did not earn income in foreign exchange as well as did not incur any expenditure in foreign exchange.

Risk Management

The Company has formulated a Risk Management Policy. The Company through the Committee for Investments / Loans and Risk Management identifies, evaluates, analyses and prioritise risks in order to address and minimize such risks. This facilitates identifying high level risks and implement appropriate solutions for minimizing the impact of such risks on the business of the Company. The Committee submits its recommendations and comments for Board's review and necessary action.

Vigil Mechanism / Whistle Blower Policy

The Company has a Vigil Mechanism / Whistle Blower Policy to report to the management instances of unethical behavior, actual or suspected, fraud or violation of the Company's code of conduct. The details of the Vigil Mechanism policy have been provided in the Corporate Governance Report and also disclosed on the website of the Company viz http://www.iitlgroup.com/newStatic/ Vigil_Mechanism_Whistle_Blower_Policy.pdf

Evaluation of the Board, its Committees and individual Directors

The Nomination and Remuneration Policy of the Company empowers the Nomination and Remuneration Committee to formulate a process for evaluating the performance of Directors, Committees of the Board and the Board as a whole.

The process for evaluation of the performance of the Director(s) / Board / Committees of the Board for the financial year 2021-2022 was initiated by the Nomination and Remuneration Committee, by sending out questionnaires designed for the performance evaluation of the Directors, Committees, Chairman and the Board as a whole. The Committee also forwarded their inputs to the Board for carrying out the Performance Evaluation process effectively.

In terms of provisions of Companies Act, 2013 and Schedule II - Part D of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board carried out the annual performance evaluation of its own including the various Committees and individual Directors with a detailed questionnaire covering various aspects of the Boards functioning like, composition of Board and its Committees, Board culture, performance of specific duties and obligations.

In a separate meeting of Independent Directors, performance of Non-Independent Directors, performance of the Board as a whole and performance of the Chairman was evaluated. Based on the feedback received from the Independent Directors and taking into account the views of Executive Directors and the Non-Executive Directors, the Board evaluated its performance on various parameters such as composition of Board and its committees, experience and competencies, performance of duties and obligations, contribution at the meetings and otherwise, independent judgment, governance issues, effectiveness of flow of information.

Auditors and Auditors' Report

The Statutory Auditors of the Company, Chaturvedi & Shah LLP, holds office till the conclusion of the ensuing Annual General Meeting.

Accordingly, on the basis of the recommendation of the Audit Committee, the Board of Directors in their meeting held on August 13, 2022 proposed to appoint Maharaj N R Suresh and Co LLP, Chartered Accountants, registered with the Institute of Chartered Accountants of India under firm registration number (ICAI FRN No. 001931S / S000020), as Statutory Auditors of the Company in place of the retiring Auditors, Chaturvedi & Shah LLP, Chartered Accountants, who shall hold office from the conclusion of this 89th Annual General Meeting (AGM) till the conclusion of the 94th Annual General Meeting of the Company to be held in the year 2027.

Maharaj N R Suresh and Co LLP, Chartered Accountants, have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed thereunder to the effect that their appointment, if made, would be within the prescribed limits under the Act and that they are not disqualified for appointment. As required under Regulation 33(1)(d) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Auditors have also confirmed that they hold a valid certificate issued by Peer Review Board of the Institute of Chartered Accountants of India.

Chaturvedi & Shah LLP, Chartered Accountants, have carried out Statutory Audit and the Notes on financial statement referred to in the Auditors' Report issued by them are self-explanatory and hence do not call for any further comments under Section 134 of the Act. The Auditors' Report on the Audited Financial Results (Standalone) does not contain any qualification, reservation or adverse remark.

However, the Auditors' Report on the Audited Financial Results (Consolidated) contains audit qualifications, as detailed hereunder:

Details of Audit Qualification:

1) IITL - Nimbus The Express Park View, (the firm) joint venture has not provided interest of Rs 297.03 lakhs on unsecured loans. The auditors of the firm and subsidiary company namely IITL Projects Limited have given qualified opinion on this matter in their report on the financial statements as at 31st March, 2022.

As a result the Company's share of loss are understated by Rs 28.75 lakhs and consequently the profit for the year is overstated and retained earnings at the year end is overstated by an equal amount.

2) IITL - Nimbus The Hyde Park Noida, (the firm) joint venture has not provided interest of Rs 95.79 lakhs for the period from 01.10.2021 to 31.03.2022 on unsecured loans. The auditors of the firm and subsidiary company namely IITL Projects Limited have given qualified opinion on this matter in their report on the financial statements as at 31st March, 2022.

As a result the Company's share of loss are understated by Rs 34.36 lakhs and consequently the profit for the year is overstated and retained earnings at the year end is overstated by an equal amount.

Management's Views:

The two projects, IITL-Nimbus The Express Park View and IITL Nimbus - The Hyde Park are in NCR Region. As per the NCR region, real estate scenario apparently has over 1 lakh units of unsold inventory as of March 31, 2022.

Due to COVID-19 and also increase in raw material cost, coupled with slow sales in these projects, the cash flows of these two firms have been adversely affected.

Given the unsold stock in hand, the cost of individual flats are not being realized as the market realizable value is lesser than the holding cost.

In the light of the above due to liquidity issue, the firms have not been able to provide the interest due on the loan. They have approached the company for One Time Settlement.

The firms are pursuing settlement with the company and is hopeful the matter shall be resolved during the current financial year.

Significant and material orders passed by the regulators

During the period under review, there were no significant and material orders passed by the regulators/ courts or tribunals that would impact going concern status of the Company and its future operations.

Transfer of Dividend amounts to Investor Education and Protection Fund

In terms of Rule 5(4) of the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, a sum of Rs 7,36,351/- lying with the Company as unclaimed dividend for the year 2013 - 2014 i.e. for a period of seven years from the date they became due for payment, were transferred during the period under review to the Investor Education and Protection Fund.

Pursuant to Rule 5(8) of the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the Company has filed the details of unpaid and unclaimed amounts lying with the Company as on March 31, 2021 with the Ministry of Corporate Affairs and have uploaded the said details on the website of the Company viz.www.iitlgroup.com and the website of the Ministry of Corporate Affairs (www.mca.gov.in).

Transfer of Equity Shares to Investor Education and Protection Fund (IEPF) Account on which dividend has not been paid or claimed by the shareholders for seven consecutive years or more

According to the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ('IEPF Rules'), the shares on which dividend has not been paid or claimed by the shareholders for seven consecutive years or more shall be transferred to the demat account of the IEPF Authority.

Accordingly, the Company has transferred 31,692 Equity shares to IEPF account as per the requirements of the IEPF rules. The details are available on our website, at

http://www.iitlgroup.com/newStatic/Reports/Equity_shares_of_last_seven_consecutive_years_transferred_to_IEPF_on_or_before_October-30-2021.pdf

Particulars of Employees and related disclosures

A) Details of the ratio of the remuneration of each Director to the median employee's remuneration and other details as required pursuant to Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:

S. Name of Director / KMP and Designation No. Remuneration of Director/ KMP for financial year 2021-22 (in Rs) % increase / (decrease) in Remuneration in the financial year 2021-22A Ratio of remuneration of each Director / to median remuneration of employees
1 Dr. B. Samal, Executive Chairman 45,24,000/- (1.22%) 8.11
2 Mr. Bipin Agarwal, Non-Executive Director 3,00,000 (Sitting fees) 0% 0.54
3 Mr. Venkatesan Narayanan, Independent Director 7,20,000 (Sitting fees) 4.35% 1.29
4 Ms. Sujata Chattopadyay 2,40,000 (Sitting fees) 14.29% 0.43
5 Mr. Milind S. Desai 6,00,000 (Sitting fees) 11.11% 1.08
6 Mr. Shankar Narayan Mokashi* (LIC Nominee), Non-Executive Director 4,50,000 (Sitting fees) Not Applicable 0.81
7 Ms. Cumi Banerjee, Chief Executive Officer & Company Secretary 39,30,568 71.47% 7.04
8 Mr. Kamlesh Kumar Agrawal $ 21,00,000 Not Applicable 3.76

* Remuneration not comparable since Mr. Shankar Narayan Mokashi (LIC Nominee) was appointed as an Additional Director w.e.f.

November 12, 2020 and hence his remuneration is for part of the year 2020-21 $ Remuneration not comparable since Mr. Kamlesh Kumar Agrawal was appointed as Group Chief Financial Officer by Board w.e.f.

September 11, 2020 and hence his remuneration is for part of the year 2020-21 A(i) On account of financial position of the Company, the Executive Chairman voluntarily relinquished 50% of his salary w.e.f. October 01, 2021. Hence there is a decrease in remuneration of Executive Chairman for the year ended March 31, 2022.

(ii) The remuneration of the Non-Executive Directors consists of sitting fees only and Increase in remuneration is based on various factors such as Director's participation in Board and Committee Meetings during the year, other responsibilities undertaken, such as Membership or Chairmanship of Committees, etc.

(iii) During the period April - September 2020, the Company deducted the salaries of KMPs on account of COVID-19. However w.e.f. October 01, 2020 the salaries were once again regularized. Hence, the difference.

Note: The remuneration to Directors includes sitting fees paid to them for the financial year 2021-22.

Note: The remuneration to Directors includes sitting fees paid to them for the financial year 2020-21.

Notes:-

i) Median remuneration of employees of the Company during the financial year 2021-2022 was Rs 7,18,128./-.

ii) Median remuneration of employees of the Company during the financial year 2020-2021 was Rs 4,33,092/-. In the financial year, there was an increase of 65.81% in the median remuneration of employees.

iii) There were 12 confirmed employees on the rolls of the Company as on March 31, 2022.

iv) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year i.e. 2021-22 was 27.14% whereas the decrease in the managerial remuneration for the same financial year was 20.05%. (This excludes the salaries of the newly joined and resigned employees during the same financial year).

v) It is hereby affirmed that the remuneration paid is as per the Remuneration Policy for Directors, Key Managerial Personnel and other employees.

B) Details of every employee of the Company as required pursuant to rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:

During the year under consideration, none of the employees of the company was in receipt of remuneration in excess of limits prescribed under clause 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Hence particulars as required under 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 have not been provided.

GENERAL

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

1. Issue of equity shares with differential rights as to dividend, voting or otherwise.

2. Issue of shares (including sweat equity shares) to employees of the Company under any scheme

3. Details relating to deposits covered under Chapter V of the Act.

4. The provisions of Section 148 of the Act are not applicable to the Company. Accordingly, there is no requirement of maintenance of cost records as specified under Section 148(1) of the Act.

5. No fraud has been reported by the Auditors to the Audit Committee or the Board.

6. There is no Corporate Insolvency Resolution Process initiated under the Insolvency and Bankruptcy Code, 2016.

Public Deposits

During the year under review, the Company has not accepted any deposits from the public.

Disclosures under Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013

In accordance with the provisions of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013, Internal Complaints Committee (ICC) has been set up to redress complaints. ICC has not received any complaints during the financial year 2021-2022.

Acknowledgement

Your Directors place on record their appreciation for employees, who have contributed to the growth and performance of your Company.

Your Directors thank the bankers, shareholders and advisers of the Company for their continued support.

Your Directors also thank the Central and State Governments and other statutory authorities / regulators for their continued support.

For and on behalf of the Board
Industrial Investment Trust Limited
Dr. B. Samal
Chairman
(DIN: 00007256)
Date : August 13, 2022
Place : Mumbai