Art Nirman Ltd

<dhhead-DIRECTOR REPORT</dhhead-

Dear Members,

Your director's take pleasure in presenting the 13th Annual Report of the company along with Audited Financial Statements for the financial year ended on 31st March, 2024. Further, in compliance with the Companies Act, 2013 the company has made all requisite disclosures in the Board Report with the objective of accountability and transparency in its operations and to make you aware about its performance and future perspective. The Board of Directors feels pleasure and is very much thankful to all the stakeholders of the company who have shown their trust and interest in Company.

FINANCIAL PERFORMANCE:

The highlights of financial figures for the year 2023-24 in comparative format are as under:

STATE OF COMPANY'S AFFAIRS:

- During the year under review, your Company has achieved total net sales of INR 3428.96 lakhs and achieved Net Profit of INR 117.87 Lakhs.

- The company has made works contract with Art Club Private Limited for construction of "Club Babylon" leading Club situated near Village Bhadaj, S.P. Ring Road, Ahmedabad. The club is now operational and company generate total revenue of approx. 12 crores and 12 Lakhs during the financial year 2023-24.

- The company has made works contract with Vishnudhara paradise for construction of Shree Vishnudhara Essence and Company has generated total revenue of INR 12 Crores 2 Lakhs during the financial year 2023-24.

- The company has made works contract with Om Enterprise for construction of "Omkar Enclave residential project and generated total revenue of approx. 7 crores and 63 Lakhs/- during the financial year 2023-24.

DIVIDEND:

Your Board of Directors feel that it is prudent to plough back the profits of the Company for future growth of the Company and therefore do not recommend any dividend for the year ended March 31, 2024.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND:

Since there was no unpaid/unclaimed dividend, the provision of Secfion 125 of the Companies Act, 2013 does not apply during the year.

CHANGE IN THE NATURE OF BUSINESS, IF ANY:

During the year, there is no change in the nature of business of the Company.

RESERVES:

During the year under review, the Company has closing balance of INR 1033.78 Lakhs as Reserve and Surplus as on 31.03.2024.

SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any subsidiary, Joint Ventures or associate company during the year. CONSOLIDATED FINANCIAL STATEMENTS:

Company doesn't have any subsidiaries and hence company is not required to prepare consolidated financial statement for the F. Y. 20 23-24.

PUBLIC DEPOSIT:

The Company has not accepted or renewed any amount falling within the purview of provisions of Secfion 73 of the Companies Act, 2013 ("the Act") read with the Companies (Acceptance of Deposit) Rules, 2014 during the period under review. Hence, the requirement for furnishing the details of deposits which are not in compliance with Chapter V of the Act is not applicable.

SHARE CAPITAL:

The authorized capital of the company is 25 crores, no change made during the financial year 202324.

The paid up capital of the company is INR 24,95,60,000/- .

PARTICULARS OF LOAN, GUARANTEES OR INVESTMENT:

Your company provided loan to the one trust and details of Loans, Guarantees and Investments covered under the provisions of Secfion 186 of the Companies Act, 2013 are given in the notes of financial statement.

PARTICULARS OF RELATED PARTY TRANSACTION:

During the year, Company has entered in to related party transactions at Arm's length price and disclosures in that regard have been made in Annexure C in prescribed format AOC-2 and forms part of this report.

There are no contracts entered into by the Company which are "Not at Arm's Length basis" and hence no disclosure in that regard is made.

EXTRACT OF THE ANNUAL RETURN:

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on March 31, 2024 is available on the company's website www.artnirman.com.

DIRECTORS AND KEY MANAGEMENT PERSONNEL:

- Composition of Board:

The Board of Directors of the Company has an optimum combination of Executive, NonExecutive and Independent Directors in compliance with provisions of Section 149 of Companies Act 2013. As on 31st March 2024, the Board of Company comprises of 6(Six) Directors. The Chairman of the Board is an Executive Director.

- Directors whose term is liable to determination by retirement by rotation:

In accordance with the provisions of Companies Act 2013 and its Articles of Association, the term of Mr. Piyushkumar Thakkar (DIN: 07555460), being Executive Director, is liable to retire by rotation and being eligible offers himself for reappointment as Director of the Company. Necessary resolution for his reappointment is placed before you for your approval in Annual General Meeting.

- Declaration from Independent Director:

The Company has received declarations from all Independent Directors of the Company that they continue to meet the criteria of independence as prescribed under Section 149 of the Companies Act 2013 and Regulation 25 of the Listing Regulations. The Independent Directors complied with code of conduct.

Therefore Board is duly composed as per the Companies Act 2013 provisions and SEBI (Listing Obligation and Disclosure Requirements), 2015.

There is no change held in the composition of Board of Directors during the Financial Year 2023-24.

BOARD AND COMMITTEE COMPOSITION AND MEETINGS:

- Board Meeting and Composition:

The Board of Directors met 6 times during the financial year 2023- 2024 in accordance with the provisions of the Companies Act, 2013 and rules made thereunder. The intervening gap between two board meetings was within the period prescribed under the Companies Act, 2013 and as per Secretarial Standard-1. The prescribed quorum was presented for all the Meetings and Directors of the Company actively participated in the meetings and contributed valuable inputs on the matters brought before the Board of Directors from time to time.

6 board meeting are held as under:

29.05.2023

14.08.2023

07.11.2023

28.12.2023

13.02.2024

11.03.2024

CMD - Chairman and Managing Director, ED - Executive Director, NED- Non- Executive Director

- Meeting of Independent Directors:

During the year under review, the Independent Directors duly met on 7th November, 2023 in absence of other non-independent Directors and reviewed the performance of

Non-Independent Directors and the Board as a whole, reviewed the performance of Chairperson of the Company, taking into account the views of the other Executive and Non - Executive Directors.

- Committee Meeting and Composition

The Company has three committees viz; Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee which has been established as a part of the better corporate governance practices and is in compliance with the requirements of the relevant provisions of applicable laws and statutes.

- Committee Meetings:

During the year under review, the Committees duly met and the details of the Meetings

held and attendance of the Directors at such Meetings, are provided in the Corporate Corporate Governance Report.

POLICY ON DIRECTORS' APPOINTMENT:

Pursuant to provisions of section 178 read with 134(3)(e) of Companies Act 2013, The Nomination and Remuneration Committee (NRC) has approved the criteria and process for identification/ appointment of Directors which are as under:

-- Criteria for Appointment:

The proposed Director shall meet all statutory requirements and should:

- Possess highest values, ethics and integrity.

- Not have any direct or indirect conflict with business operations.

- Be willing to devote time and efforts.

- Have relevant experience.

- Have understanding about corporate functionality.

- Understand real value of stakeholders.

- Process for identification of Directors / Appointment of Directors:

- Board Members may suggest any potential person to the Chairman of the Company meeting the above criteria. If the chairman deems fit, recommendation will be made by him to NRC.

- Chairman himself can also recommend a person to NRC.

- NRC shall process and evaluate the proposal and shall submit their recommendation to Board.

- Board shall consider such proposal on merit and decide suitably.

- Criteria for Performance Evaluation:

The Board considered and approved criteria for performance evaluation of itself and that of its committees and individual directors.

- Criteria for Board Evaluation:

- Focus on strategic decisions.

- Qualitative discussion and processes.

- Criteria for Committee Evaluation:

- Fulfillment of allotted responsibilities.

- Effectiveness of recommendation, meetings.

- Criteria for Independent and Non Independent Directors' evaluation:

- Contribution through their experience and expertise.

- Focus on Stakeholders' interest.

MANNER OF EVALUATION OF BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS:

The Evaluation of Board, its Committees and Individual Directors was carried out as per process and criteria laid down by the Board of Directors based on the recommendation of the Nomination and Remuneration Committee.

The obtaining and consolidation of feedback from all Directors in this regards, was coordinated by the Chairman of Independent Directors' meeting for Board and Non-Independent Directors while the process of evaluation of the Independent Directors was coordinated by the Chairman of the Company. Based on this, Chairman of the Company brief the Board and each of the Individual Directors, as applicable.

REMUNERATION POLICY:

The Company has formulated a policy relating to the remuneration of the Directors, Key Managerial Personnel and other employees of the Company which is as under:

Components of Remuneration:

- Fixed Pay comprising Basic Salary, HRA, Car Allowance (applicable to General Managers &above employees), Conveyance Allowances / Reimbursement, Company's contribution to Provident Fund, Superannuation Fund, Gratuity, etc.

- Variable Pay, which is either in the form of: Commission to Managing Directors and Commission to Whole-time Directors

A) Annual Appraisal process:

- Annual Appraisals are conducted, following which annual increments and promotions in deserving cases are decided once in a year based on:

- Employees self-assessment

- Assessment by Immediate Superior and

- Assessment by Head of Department

Annual Increment leading to an increase in Fixed Pay consists of Economic Rise based on All India Consumer Price Index published by the Government of India or Internal Survey wherein inflation on commonly used items is calculated.

B) Remuneration of Independent Directors:

The Company has formulated a policy for the remuneration of Independent Directors as follows:

- Reimbursement of Expenses incurred by Independent Directors for attending any meeting of the Board.

CHIEF FINANCIAL OFFICER:

Mr. Chetankumar Modi appointed as a Chief Financial Officer of the Company on September 11, 2019.

COMPANY SECRETARY:

Ms. Yesha Shah, a member of Institute of Company Secretaries of India is holding post of Company Secretary of the Company from June 01, 2019.

COMPLIANCE OFFICER:

The Compliance officer of the Company is Ms. Yesha Shah, being the member of Institute of Company Secretaries of India, designated as Company Secretary and holding the post of compliance officer since June 01, 2019.

STATEMENT ON FORMAL ANNUAL EVALUATION OF BOARD:

Nomination and Remuneration Committee annually evaluates the performance of individual directors, Committees and of the Board as a Whole in accordance with the formal system adopted by the Board. Further, the Board also, regularly in their Board Meeting held for various purposes, evaluates the performance of the individual directors, committees and of the Board as a whole. The Board considers the recommendation made by Nomination and Remuneration Committee in regard to the evaluation of Board Members.

DIRECTORS' RESPONSIBILITY STATEMENT:

In terms of Section 134 (5) of the Companies Act, 2013, the directors would like to state that:

(a) In the preparation of the annual accounts for the financial year ended March 31, 202 3, the applicable accounting standards have been followed along with proper explanation relating to material departures.

(b) The directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period under review.

(c) The directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities.

(d) The directors have prepared the annual accounts on a going concern basis.

(e) The directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

(f) The directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

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:

After the close the Financial Year on 31st March 2024 and before the date of the Report, no material changes affecting the financial position of the Company have occurred:

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

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concerns status and Company's operations in future.

AUDITORS:

- Statutory Auditor:

M/s. Arpan Shah & Associates, Chartered Accountants (FRN.: 125049W, Peer Review Certificate No. 011646) Ahmedabad appointed as a Statutory Auditors of the Company to hold office until the conclusion of 13th Annual General Meeting of the Company held on FY 2023-2024."

There are no qualifications, reservations or adverse remarks made by M/s. Arpan Shah & Associates, Chartered Accountants, the Statutory Auditors of the Company, in their report.

- Board's Comment on the Auditors' Report:

Notes to Accounts & Auditors remarks in the Auditors' report are self explanatory and do not call for any further comments.

- Secretarial Auditor:

As required under provisions of Section 204 of the Companies Act, 2013 and Rules framed thereunder, the Board has appointed the Secretarial Auditors of the Company, M/s Yash Mehta & Associates, Practicing Company Secretaries, for conducting the Secretarial Audit for the FY 2023-24.

Secretarial Audit Report in Form MR-3 issued by the Secretarial Auditor of the Company for the year ended on March 31, 2024 is attached to the Director's Report as Annexure- B.

- Board's Comment on the Secretarial Audit Report:

a. The Company has not made any provisions for the gratuity payable to the employees.

- The company is under process of adopting the gratuity policy for its employees.

- Cost Audit & Cost Record:

Central Government has notified audit of the cost records maintained by the company in respect of the Products/services manufactured by the company for the year under review. Our company is not manufactured any products so it is not required to be maintained any cost record and conducting any cost audit as per central government direction under section 148 of the Companies Act, 2013, and the Companies (Cost Records and Audit) rules, 2014.

-- Internal Audit:

D. K. Thakkar & Co, Chartered Accountant, Ahmedabad was appointed as Internal Auditor of the Company to conduct Internal audit pursuant to the provisions of Section 138 of the Companies Act, 2013 and rules made there under.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:

The information required under Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in separate annexure forming part of this Report as Annexure-D.

The statement containing particulars of employees as required under Section 197 of the Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 will be provided upon request. In terms of Section 136 of the Companies Act, 2013, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees' particulars which is available for inspection by the members at the Registered Office of the Company during business hours on working days of the Company. If any member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The provisions of Corporate Social Responsibility (CSR) are not applicable to the Company and hence no disclosures have been made in this regard.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGSAND OUTGO

The Company is not engaged in manufacturing of goods and hence Company does not conserve energy. Company has neither adopted any Technology nor has spent amount for adoption of Technology during the year. There is no amount of Foreign Exchange inflow or outflow during the year and hence no disclosures have been made in this regard.

ENVIRONMENT, HEALTH AND SAFETY (EHS)

The Company accords the highest priority to health, environment and safety. The Company does not carry on manufacturing operations. The Company takes at most care for the employees and ensures compliance with the applicable rules and regulation applicable to the Company.

STATEMENT REGARDING THE DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY:

The Company has developed risk management policy. The Company has in place, a mechanism to identify, assess, monitor and mitigate various risks towards the key business objectives of the Company. Major risks identified by the business and functions are systematically addressed through mitigating actions on a continuing basis. The Risk Management is being taken care by the Audit Committee of the Company.

ADEQUACY OF INTERNAL FINANCIAL CONTROL

The Company has in place adequate internal financial controls with reference to financial statements. The Board has inter alia reviewed the adequacy and effectiveness of the Company's internal financial controls relating to its financial statements.

During the year, no reportable material weakness was observed.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

As stipulated in Rule 34(2)(e) read with Schedule V of SEBI (Listing Obligation and Disclosure Requirements) Regulations 2015, the Management Discussion and Analysis Report is annexed as Annexure E and forms part of this Annual Report.

CORPORATE GOVERNANCE REPORT

Corporate Governance refers to a set of systems, procedures and practices which ensure that the company is managed in the best interest of all corporate stakeholders i.e. shareholders, employees, suppliers, customers and society in general. Fundamentals of Corporate Governance include transparency, accountability and independence. Your Company has been complying with all the requirements of the code of Corporate Governance, as specified by SEBI. A separate report on Corporate Governance is furnished as a part of the Directors' Report and the certificate from the Statutory Auditor regarding compliance of condition of Corporate Governance is Annexure-A to the said Report.

DISCLOSURE WITH RESPECT TO DEMAT SUSPENSE ACCOUNT / UNCLAIMED SUSPENSE ACCOUNT:

Pursuant to Para F of Schedule V of SEBI (LODR) Regulations 2015, there are no shares held in the Demat Suspense Account or Unclaimed Suspense Account.

DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013.

The Company has always been committed to provide a safe and conducive work environment to its employees. Your Directors further state that during the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

INSOLVENCY AND BANKRUPTCY CODE:

There is no application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year.

PENDING LITIGATION:

There is no case pending in front of the company.

DETAILS OF DIFFERENCE BETWEEN VALUATION AMOUNT ON ONE TIME SETTLEMENT AND VALUATION WHILE AVAILING LOAN FROM BANKS AND FINANCIAL INSTITUTIONS:

During the year under review, there has been no one time settlement of loans taken from banks and financial institution

ACKNOWLEDGEMENT

The Directors place on record their sincere thanks to the Bankers, Business associates, consultants, customers, employees for their continued support extended to your Companies activities during the year under review. Your Directors also acknowledges gratefully the shareholders for their support and confidence reposed on your Company.