Prabhat Technologies (India) Limited

The Resolution Professional presents to the Members the Sixteenth Annual Report of the Company together with the Director's Report, Audited Financial Statements and Auditor's Report for the year ended March 31, 2023.

The members are hereby informed that pursuant to the order dated October 10, 2019, of the

Hon'ble National Company Law Tribunal Mumbai Bench, at Mumbai ("NCLT Order"), Corporate Insolvency Resolution Process ("CIRP") has been initiated for the Company in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016, ("the Code") and related rules and regulations issued thereunder. Mr. Rajendra K. Bhuta, having Registration No. (IBBI/IPA-001/IP-P00141/2017-18/10305) was appointed as Interim Resolution Professional ("IRP") and was subsequently appointed as the Resolution Professional ("RP") in terms of the NCLT Order.

Members are further informed that pursuant to Section 17 of the Code, the powers of Board of Directors of the Company stand suspended effective from the CIRP commencement date and such powers along with the management of affairs of the Company are vested with the Resolution Professional, viz., Mr. Rajendra K. Bhuta.

1. FINANCIAL RESULTS:

A Summary of the Company's financial performance as per the financial statements prepared according to the Ind AS for the FY 2022-23 as compared to the previous financial year is given below:

(Figures in lakhs except EPS)

Note:

The RP approved these financial results only to the limited extent of discharging powers of Board of Directors of the Company conferred on him in terms of Section 17 of the Code. The Statutory Audit for the quarter and year ended on March 31, 2023, as required under Regulation 33 of SEBI (Listing Obligation and Disclosure requirements) regulation 2015 ("SEBI LODR"), has been carried out by Statutory Auditors of the Company.

2. RESULTS OF OPERATIONS:

As per Consolidated financial statement the Company earned a total income of Rs. 268.67 Lakhs during the FY 2022-23, as compared to to the total income of Rs. 369.51 Lakhs earned in the previous FY 2021-22. The Company's net loss for the financial year ended March 31, 2023, stood at Rs. 135.74 lakhs as against the net loss of Rs. 177.10 lakhs in the previous year.

3. STATE OF COMPANY'S AFFAIRS:

As stated above, that pursuant to the order dated October 10, 2019, of the NCLT, CIRP has been initiated for the Company in accordance with the provisions of the Code and related rules and regulations issued thereunder. Mr. Rajendra K. Bhuta, having registration no. IBBI/IPA-001/IP-P00141/2017-18/10305 was appointed as the IRP with effect from October 10, 2019 in terms of the NCLT Order and the powers of the board of directors has been suspended and the same are exercisable by Mr. R.K. Bhuta, the RP pursuant to Section 17 of the Code.

4. SHARE CAPITAL:

The Authorized Share Capital of the Company is Rs. 12,00,00,000/- and the paid-up share capital of the Company is Rs. 10,70,62,770/-. There was no change in the share capital of the Company during the year under review.

5. TRANSFER TO RESERVE AND SURPLUS:

There were no transfer to general reserve and surplus during the year ended March 31, 2023.

6. CHANGE IN THE NATURE OF THE BUSINESS:

During the year under review, there has been no change in the nature of the business of the Company.

7. CHANGE IN THE NAME OF THE COMPANY:

During the year under review, there was no change in the name of the Company.

8. DIVIDEND:

With a view to strengthening the financial position of the Company, your Board of Director's have not recommended any dividend for the FY 2022-23.

9. TRANSFER TO THE INVESTOR EDUCTION AND PROTECTION FUND:

There are no underlying shares for which dividend has remained unpaid or unclaimed for a consecutive period of seven years. Therefore, there is no transfer of the same to the Investor Education Protection Fund.

10. PUBLIC DEPOSITS:

The Company has not accepted any public deposits during the FY 2022-23.

11. SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES:

*Prabhat Telecoms Hong Kong Limited is a Defunct Company.

There are no Companies / Body Corporate which have become/ceased to be subsidiary/ Joint Venture / Associate during the FY 2022-23.

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 ("Act") read with the Companies (Accounts) Rules, 2014, a statement containing salient features of financial statements of subsidiaries and joint venture companies in Form AOC- 1 and forms part of this report as "Annexure-I". The separate financial statements in respect of each of the subsidiary shall be kept open for inspection at the Registered Office of the Company. The Company will also make available these documents upon request by any Member of the Company interested in obtaining the same.

The Company has formulated a Policy for determining Material Subsidiaries. The Policy is put up on the Company's website at www.prabhatgroup.net.

12. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186:

Particulars of loans, guarantees given and investments made during the year, as required under Section 186 of the Act and Schedule V of the SEBI LODR, if any is provided in the notes of the financial statements of the Company for the year ended March 31, 2023.

13. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

The particulars of contracts or arrangements with related parties as prescribed in Form No. AOC 2 of the Companies (Accounts) Rules, 2014, is annexed to this report as "Annexure II". Further, the details of the transactions with Related Party are provided in the Company's financial statements in accordance with the Accounting Standards.

The policy on Related Party Transactions of the Company ensures proper approval and reporting of the concerned transactions between the Company and its related parties and the same as approved by the Board of Directors prior to the commencement of the CIR Process has been uploaded on the website of the Company viz. www.prabhatgroup.net.

a. Directors

Pursuant to the commencement of the CIRP against your Company, the powers of the Board of Directors stand suspended and the same are exercised by the RP, in accordance with the provisions of the Code.

b. Key Managerial Personnel

i. Mr. Yash Pankaj Jain (ACS: 67206) had resigned from the post of Company Secretary and Compliance Officer due to personal reasons w.e.f. August 12, 2022.

ii. Mr. Gunjan Jain (ACS: 56697) was appointed as the Company Secretary and Compliance Officer of the Company w.e.f. February 3, 2023.

15. INDEPENDENT DIRECTOR'S MEETING:

Not appliacble as the Company is under CIRP during the year under review.

16. DECLARATION BY INDEPENDENT DIRECTOR:

Not appliacble as the Company is under CIRP during the year under review.

17. FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS:

Not appliacble as the Company is under CIRP during the year under review.

18. REGISTRATION WITH INDEPENDENT DIRECTORS DATABANK:

Not appliacble as the Company is under CIRP during the year under review.

19. MEETINGS OF BOARD OF DIRECTORS AND INSOLVENCY RESOLUTION PROFESSIONAL:

As stated above, Members are informed that pursuant to Section 17 of the Code, the powers of Board of Directors of the Company stand suspended w.e.f. October 10, 2019, such powers along with the management of affairs of the Company are vested with the Resolution professional, viz., Mr. Rajendra K. Bhuta and no Board Meetings with the presence of Board of Directors were held thereafter.

During the year under review, the Company had total of 4 meetings chaired by RP which was held on May 25, 2022, August 9, 2022, November 10, 2022 and February 3, 2023.

Mr. Parag Malde, Chief Financial Officer of the Company and Mr. Rajendra Bhuta have attended all the meetings.

20. BOARD COMMITTEES:

As stated above, Members are informed that pursuant to Section 17 of the Code, the powers of Board of Directors of the Company stand suspended with effect from October 10, 2019 such powers along with the management of affairs of the Company are vested with the Resolution professional, viz., Mr. Rajendra K. Bhuta and no Committee Meetings were held thereafter.

21. BOARD EVALUATION:

Not appliacble as the Company is under CIRP during the year under review.

22. NOMINATION AND REMUNERATION POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION:

Not appliacble as the Company is under CIRP during the year under review.

A. Statutory Auditors and it's Report:

Pursuant to the provisions of Section 139 of the Act and rules made thereunder, M/s. Harish Arora & Associates, chartered accountants, (Firm Registration No. 015226C) were appointed as the statutory Auditor of the Company at the 12^th AGM of the Company, for a period of five (5) consecutive years from the conclusion of 12^th Annual General Meeting till the conclusion of the 17^th AGM of the Company, on such remuneration as may be recommended by the Audit Committee and mutually agreed, between the Board of Directors and the Auditors plus out of pocket expenses as may be incurred.

The Auditors' Report annexed to the financial statement for the year under review contain a qualified Opinion.

Qualification on Auditors' Report:

i. Auditors' Qualification:

As per notes mentioned in the Financial Results which states that the Company has recognized Non-Sustainable Debt pursuant to CIRP as part of Reserves on the basis of the decision taken as part of COC resolution meeting, approved by 98.15% COC Members through vote. This adjustment is considered as per COC Committee and is recognized in the financial results. However, such transactions are subject to NCLT approval and should have been acknowledged on duly confirmation/acceptance from the NCLT court.

ii. Management opinion:

Under the CIRP, a resolution plan was submitted for the consideration of Committee (COC), e-voting has taken place after 9th CoC Meeting, the RP has placed on record the results of Evoting and informed the Members and Shareholder that Resolution has been approved with 98.15% votes in favour of resolution plan. The said resolution plan filed for approval of National Company Law Tribunal (NCL), Mumbai Bench for its approval vide dated November 08, 2020.

In Auditors opinon, such transactions are subject to NCLT approval and should have been acknowledged on duly confirmation/acceptance from the NCLT court. Management believes that the aforesaid adjustment is important and could impact the decision of the reader of the Financial Statement.

B. Internal Auditors:

The Corporate Debtor is under Insolvency and due to cost constraints and Cash Flow issues, RP has delayed the process of appointing Internal Auditor.

C. Secretarial Auditors:

In compliance with the provisions of Section 204 of the Act, Rule 9 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Regulation 24A of SEBI LODR, the Company had appointed M/s. HD and Associates (Membership No.: A47700, COP No. 21073) Practicing Company Secretaries, as a Secretarial Auditor of the Company w.e.f. May 22, 2023, to conduct the secretarial audit of the Company, for the FY 2022-23.

The Company has provided all assistance, facilities, documents, records, and clarifications etc. to the Secretarial Auditors for the conduct of their audit. The Secretarial Audit Report in Prescribed format as MR 3 for the FY 2022-23 is appended to this Report as "Annexure IV".

Further, Company had appointed M/s. NVB & Associates (Membership No: 12268; CP No. 6069), Practicing Company Secretary, as a Secretarial Auditor of the Company w.e.f. September 5, 2023, to conduct the Secretarial Audit of the Company for the FY 2023-24.

24. DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT:

The Statutory Auditor and Secretarial Auditor of your Company have not reported any frauds to the Audit Committee or to the Board of Directors under Section 143(12) of the Act including rules made thereunder.

25. CORPORATE SOCIAL RESPONSIBILITY [CSR]:

The provisions of the CSR expenditure and Composition of Committee, as provided in the Section 135 of the Act is not applicable to the Company.

26. MANAGERIAL REMUNERATION AND PARTICULARS OF EMPLOYEES:

In terms of the provisions of Section 197(12) of the Act read with Rule 5 (1), 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the Managerial Remuneration and Particulars of employees forms part of this report as

"Annexure III".

27. ANNUAL RETURN:

As required under section 92(3) of the Act and rules framed thereunder and amended from time to time, the Annual Return of the Company in prescribed Form MGT-7 is available on the website of the Company i.e. at www.prabhatgroup.net.

28. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION:

Pursuant to provisions of Section 134 of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 the details of Conservation of Energy and Technology Absorption are as follows:

a. Major energy conservation measures taken during the year:

The Company has taken adequate measures to conserve energy by continuous monitoring and effective use of energy, which is a continuous process.

b. Additional investment and proposals, if any, being implemented for reduction of consumption of energy:

No additional investment proposed.

c. Impact of measures at (a) and (b) above for reduction of energy consumption and consequent impact on the cost of production of goods:

Since it is continuous process of monitoring and usage, the impact is not quantifiable.

d. During the year Company has taken following measure for optimisation of electricity:

(Amount in Lakhs)

B. TECHNOLOGY ABSORPTION

Particulars with respect to technology absorption are given below:

i. Specific areas in which R & D carried out by the Company: The Company has not carried out any research and development activities during the year under review.

ii. Benefits derived as a result of the above R & D: Not Applicable

iii. Future plan of Action: NIL

iv. Expenditure on R & D.: NIL

C. FOREIGN EXCHANGE EARNINGS AND OUTGO:

The Company does not have any Foreign exchange earnings / expenses during the year under review and therefore the information in respect of Foreign Exchange Earnings and Outgo as required by Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is not provided.

29. SECRETARIAL STANDARDS:

During the year under review, the Company has complied with the applicable provisions of Secretarial Standards issued by The Institute of Company Secretaries of India.

30. COMPLIANCE CERTIFICATE FROM THE PRACTICING COMPANY SECRETARIES REGARDING COMPLIANCE OF CONDITIONS OF CORPORATE GOVERNANCE:

As per regulation 15(2A) and (2B) of SEBI LODR, the provisions as specified in Regulation 17 to 21 of SEBI LODR are not applicable during the Insolvency resolution process period in respect of a listed entity which is undergoing Corporate Insolvency Resolution Process under the Insolvency Code. Hence, compliance certificate from the practicing company secretaries regarding compliance of conditions of corporate governance is not applicable to the Company during the year under review.

31. INTERNAL CONTROL AND ITS ADEQUACY:

The Company has a well-placed, proper and adequate internal financial control system which ensures that all assets are safeguarded and protected and that the transactions are authorized recorded and reported correctly. The Company's internal financial control system also comprises due compliances with Company's policies and Standard Operating Procedures (SOPs).

32. RISK MANAGEMENT POLICY:

The Board of the Company had, prior to commencement of the CIR process, laid down Risk Management framework to identify measure and mitigate& articulate business risk and opportunities. This framework seeks to create transparency, minimize adverse impact on the business objective and enhance the Company's competitive advantage. This risk framework thus helps in managing market, credit and operations risks.

33. MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAS OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT:

No specific material changes and commitments affecting the financial position of your Company have occurred between the end of the financial year under review, i.e. March 31, 2023 and the date of this Report.

34. VIGIL MECHANISM / WHISTLE BLOWER POLICY:

The Company had, prior to the commencement of the CIRP, put in place a Vigil Mechanism/Whistle Blower Policy in terms of the provisions of Act and the SEBI LODR, to provide a formal mechanism to the Directors and employees of the Company to report their genuine concerns and grievances about unethical behaviour, actual or suspected fraud or violation of the Company's Code of Conduct or Ethics. The details of establishment of Vigil Mechanism / Whistle Blower Policy are posted on the website of the Company at www.prabhatgroup.net.

No employee has been denied access to the Resolution Professional and that no complaints were received during the year and the Resolution Professional has relied on such representation.

35. CODE OF CONDUCT FOR PREVENTION OF INSIDER TRADING:

As per SEBI (Prohibition of Insider Trading) Regulations, 2015, the Board of the Company had, prior to commencement of the CIR process, laid down a Code of Conduct for Prohibition of Insider Trading. The Code is applicable to Promoters and Promoter's Group, such Designated Employees who are expected to have access to price sensitive information relating to the Company. The details of establishment of Code of Conduct for Prevention of Insider Trading SEBI (PIT) Regulation, 2015, are posted on the website of the Company at www.prabhatgroup.net.

36. PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE:

Your Company has always believed in providing a safe and harassment free workplace for every women employee working with your Company. Your Company always endeavors to create and provide an environment that is free from discrimination and harassment including sexual harassment.

Your Company has a zero tolerance for sexual harassment at workplace and, therefore has in place a policy on prevention of sexual harassment at workplace. The said policy is in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder.

The Company's policy on the same is placed on the Company's website at www.prabhatgroup.net.

37. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE:

In terms of the order dated October 10, 2019 of the Hon'ble National Company Law Tribunal Mumbai Bench at Mumbai ("NCLT Order"), Corporate Insolvency Resolution Process ("CIR Process") has been initiated against the Company in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016, ("Code") and related rules and regulations issued thereunder and had appointed Mr. Rajendra K. Bhuta having Registration No. (IBBI/IPA-001/IP-P00141/2017/18/10305) as Insolvency Resolution Professional vide its order dated October 10, 2019 to manage affairs of the Company in accordance with the provisions of the Code.

To the best of our knowledge, during the year under review, the Company has not received any other order from the Regulators, Courts or Tribunals which may impact the Going Concern status or the Company's operations in future and that the Company has complied with all the requirements of the Listing Regulations with the Stock Exchanges as well as regulations and guidelines of SEBI.

38. COST RECORDS AND COST AUDIT

During the year under review, maintenance of cost records and requirements of cost audit as prescribed under the provisions of Section 148 (1) of the Act is not applicable for the business activities carried out by the Company.

39. POSTAL BALLOT:

During the year under review, no postal ballot was conducted by the Company.

40. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

Not appliacble as the Company is under CIRP during the year under review and pursuant to Section 17 of the Code, the powers of Board of Directors of the Company stand suspended with effect from October 10, 2019.

41. REPORT ON CORPORATE GOVERNANCE:

Not applicable as the Company is under CIRP during the year under review and pursuant to Regulation 15(2A) and (2B) of SEBI LODR, the provisions as specified in Regulation 17 to 21 of SEBI LODR are not applicable during the Insolvency resolution process period in respect of a listed entity which is undergoing Corporate Insolvency Resolution Process under the Insolvency Code.

42. OTHERS:

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

i. BUY BACK OF SECURITIES: The Company has not bought back any of its securities during the year under review.

ii. SWEAT EQUITY: The Company has not issued any Sweat Equity Shares during the year under review.

iii. BONUS SHARES: No Bonus Shares were issued during the year under review.

iv. EMPLOYEES STOCK OPTION PLAN: The Company has not provided any Stock Option Scheme to the employees.

v. FURTHER / RIGHT ISSUE: The Company has not issued any Equity Shares during the year under review through Private Placement or on rights basis.

43. RESOLUTION PROFESSIONAL RESPONSIBILITY STATEMENT:

In accordance with the provisions of Section 134 (3) (c) of the Act, and based on the information provided by management, your management state that:

i. with the provisions of all applicable laws and that such systems were adequate and operating

In the preparation of the annual accounts for the financial year ended March 31, 2023, the applicable accounting standards have been followed;

ii. Accounting policies selected have been applied consistently. Reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the State of affairs of the Company as at March 31, 2023, and of the profit and loss of the Company for the year ended on that date;

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

iv. The annual accounts of the Company have been prepared on a going concern basis;

v. The Internal financial controls have been laid down to be followed by the Company and such internal financial controls are adequate and operating effectively;

vi. Proper systems have been devised to ensure compliance effectively.

44. APPLICATION MADE OR PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016:

The Committee of Creditors (CoC) had approved the resolution plan on October 27, 2020, and the resolution plan was filed for approval of Hon'ble National Company Law Tribunal (NCLT), Mumbai Bench vide dated November 08, 2020.

The said resolution plan is however pending for approval before Hon'ble National Company Law Tribunal (NCLT), Mumbai Bench whereas the Company's matter is inadvertently pushed to the next hearing as mentioned below:

45. THE DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF:

There is no one time settlement done with bank or any financial institution.

46. IN CASE THE SECURITIES ARE SUSPENDED FROM TRADING, THE DIRECTORS REPORT SHALL EXPLAIN THE REASON THEREOF:

There is no suspension in trading order passed against the Company

47. ACKNOWLEDGEMENT:

Your Company take this opportunity to express deep and sincere gratitude to all the stakeholders of the Company.