Modern Engineering and Projects Ltd

To the Members,

The Directors have pleasure in presenting their Seventy-Eighth Directors' Report of Modern Engineering and Projects Limited ("the Company") along with the Audited Financial Statements for the year ended March 31, 2024.

1. FINANCIAL HIGHLIGHTS:

The financial performance of the Company during the financial year ended March 31, 2024, as compared to previous financial year are summarized below:

(Rs. In Lacs)

2. STATE OF COMPANY'S AFFAIRS

O During the year under Revenue from operation of the Company has been increased from Rs. 6779.89 Lakhs to Rs. 9321.93 Lakhs as compared to previous year and other income has been decrease from Rs. 163.45 lakhs to Rs. 62.45 lakhs. as compared to the previous year.

O The Company has booked Profit after Tax of Rs. 364.52 Lakhs as compared to loss of Rs. 264.88 Lakhs.

3. DIVIDEND

The Board of Directors has not recommended any dividend for the financial year under review.

4. TRANSFER TO RESERVES

The Board of Directors of the Company has not recommended any amount to transfer in to the reserves.

5. SHARE CAPITAL AND CHANGES THEREIN

There was no change in the Authorized share capital of the Company during the financial year. As on March 31, 2024, the paid-up equity share capital of your Company was Rs.3,09,00,000 divided into 30,90,000 equity shares of Rs.10/- each.

Further Board of Directors of the Company has approved the issue of equity shares of Rs. 10/- each of the Company on Rights issue basis up to an aggregate amount of Rs. 49,90,00,000/- (Rupees Forty-Nine crores and Ninety Lakhs only).

6. ANNUAL RETURN

As required under section 92 read with section 134(3)(a) of the Companies Act, 2013 (the "Companies Act") the Annual Return for the financial year ended March 31, 2024 is available on the website of the Company and can be accessed at www.mep.ltd

7. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013 the Board of Directors to the best of their knowledge and ability confirms that: i. In the preparation of the annual accounts for financial year ended March 31, 2024, the applicable accounting standards have been followed along with proper explanation relating to material departures; ii. Have selected such accounting policies 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 at the end of financial year and of the Profit for that period; iii. 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; iv. Have prepared the annual accounts for financial year ended March 31, 2024 on a ‘going concern' basis; v. Had laid down internal financial control to be followed by the Company and that such internal financial controls are adequate and have been operating efficiently; and vi. Have devised proper systems to ensure compliance with provisions of all applicable laws and that such systems were adequate and operating effectively.

8. DEPOSITORY SYSTEM

Your Company's Equity Shares are available for dematerialization through National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). As on March 31, 2024, 99.34% of the Equity Shares of your Company were held in dematerialized form.

9. NUMBER OF MEETINGS OF THE BOARD

During the financial year, the Board of Directors met 8 (Eight) times on April 20, 2023; April 28, 2023; May 30, 2023; August 10, 2023; September 01, 2023; November 08, 2023; December 19, 2023; and February 13, 2024.

The Audit Committee comprises of Two Independent Director and one Non-executive Directors, viz. Dr. Pandit Sawant Chairman (Independent Director), Mr. Shivratan Agarwal (Independent director) and Mr. Jashandeep Singh, (Non-executive Director).

The terms of reference of the Audit Committee approved by the Board as per the provisions of section 177 of the Companies Act, 2013.

The primary objective of the Audit Committee is to monitor and provide effective supervision of the management's financial reporting progress with a view to ensuring accurate timely and proper disclosures and transparency, integrity and quality of financial reporting. The Committee oversees the work carried out by the management, internal auditors, statutory auditors on the financial reporting process and the safeguards employed by them. The Recommendation by the Audit Committee as and when made to the Board has been accepted by it.

During the financial year, members of the Audit Committee met 4 (four) times on May 30, 2023; August 10, 2023; November 08, 2023; and February 13, 2024.

The Nomination & Remuneration Committee comprises of Two Independent Director and one Non-executive Directors, viz. Dr. Pandit Sawant Chairman (Independent Director), Mr. Shivratan Agarwal (Independent director) and Mr. Jashandeep Singh, (Non-executive Director).

The terms of reference of the Nomination & Remuneration Committee approved by the Board as per the provisions of section 178 of the Companies Act, 2013 are as follows:

a. Formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the board of directors a policy relating to, the remuneration of the directors, key managerial personnel and other employees;

b. Formulation of criteria for evaluation of performance of independent directors, Board, its committee and individual directors;

c. Devising a policy on diversity of board of directors;

d. Identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, and recommend to the board of directors their appointment and removal;

e. Whether to extend or continue the term of appointment of the independent director, on the basis of the report of performance evaluation of independent directors;

f. Recommend to the Board, all the remuneration, in whatever form, payable to senior management.

g. Formulate detailed ESOS Plan and the terms and conditions thereof including but not limited to determination of the Exercise Price, Exercise Period, Lock in period, consequence of failure to exercise option, method of valuation, accounting policies, disclosures, etc. and matters related thereto

During the financial year, the members of the Nomination & Remuneration Committee met 5 (Five) times on May 30, 2023, September 01, 2023; November 08, 2023; December 19, 2023; and February 13, 2024.

The scope of the Stakeholders Relationship Committee is to review and address the grievances of the shareholders in respect of share transfers, transmission, issue of duplicate/consolidated share certificates, allotment and listing of shares, non-receipt of annual report, non- receipt of balance sheet, non-receipt of dividend etc. and other related activities. In addition, the Committee also looks into matters that can facilitate better investor's services and relations.

Composition of Stakeholders Relationship Committee is in alignment with the provisions of Section 178 of Companies Act, 2013.

The scope of the Stakeholders Relationship Committee is to review and address the grievances of the shareholders in respect of share transfers, transmission, issue of duplicate/consolidated share certificates, allotment and listing of shares, non-receipt of annual report, non- receipt of balance sheet, non-receipt of dividend etc. and other related activities. In addition, the Committee also looks into matters that can facilitate better investor's services and relations.

Status of Investor Complaints for the Financial Year ended March 31, 2024:

During the financial year, members of the Stakeholders Relationship Committee does not meet.

The policy on appointment and remuneration including criteria for determining qualifications, positive attributes, independence of Directors' and Key Managerial Personnel and other matters provided under Section 178(3) of the Companies Act, is appended as Annexure I to this Report and also is available on the website of the Company at www.mep.ltd

The details of loans given, Investments made and guarantees given and securities provided by the company during the financial year ended March 31, 2024 have been provided in the notes to the Financial Statements provided in this Annual report.

All contracts / arrangements / transactions entered by the Company during the financial year under review with related parties as defined under the Companies Act, 2013, were in the ordinary course of business and on an arm's length basis. During the year, the Company had not entered into any contract / arrangement / transaction with related parties which could be considered material. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3) of the Companies Act in Form AOC-2 is not applicable.

Attention of the members is drawn to the disclosures of transactions with the related parties as per Indian Accounting Standard (IND AS) 27 is set out in Notes to Accounts forming part of the financial statement forming part of Annual report.

There have been no material changes and commitments affecting the financial position of the Company between the end of the financial year and the date of this report other than those disclosed in this report.

Conservation of Energy

Your Company has taken necessary steps and initiative in respect of conservation of energy to possible extent to conserve the energy resources.

Technology Absorption

Your Company is not engaged in any manufacturing activity, the particulars of technology absorption as required under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 are not applicable.

Foreign Exchange Earnings and Outgo

During the period under review, the Company had not earned any foreign exchange nor incurred any outflows in foreign exchange.

Your Company is aware of the risks associated with the business. It regularly analyses and takes corrective actions for managing/mitigating the same. Your Company has institutionalized the policy/process for identifying, minimizing and mitigating risk which is reviewed. The key risks and mitigation actions are placed before the Audit Committee.

In terms of Section 135 of the Companies Act, 2013, provisions of Corporate Social Responsibility are not applicable to the Company during the year under review.

The Board adopted a formal mechanism for evaluating performance of the Board, its committees and individual Directors, including the Chairman of the Board pursuant to the provisions of the Companies Act, 2013. The exercise was carried out through an evaluation process as formulated by Nomination & Remuneration Committee (NRC) covering various aspects of the Board's functioning such as composition of the Board & committees, experience & competencies, performance of specific duties & obligations, contribution at the meetings and otherwise, independent judgement, governance issues etc.

All Directors participated in the evaluation. Evaluation was carried out on individually excluding the Director being evaluated.

During the financial year ended March 31, 2024, there was no change in the nature of business of the Company.

During the year Mr. Jashandeep Singh (DIN: 02357390) due to owing other commitments resigned from the post of Managing Director of the Company with effect from the close of business hour December 19, 2023 further Mr. Jashandeep Singh shall continue to be act as Non-executive Director of the Company. Based on the recommendation of Nomination & Remuneration Committee, Board of Directors of the Company subject to the approval of shareholders appointed Mr. Sitaram Dhulipala (DIN: 03408989) as a Managing Director of the company w.e.f. December 20, 2023 for a period of 3 years.

The Board of Director, on the recommendation of Nomination & Remuneration Committee, appointed Mr. Shivratan Agarwal (DIN: 03496765) as an Additional Non-executive Independent Director on the Board of Directors of the Company with effect from February 13, 2024.

Since the date of last report, Mr. Shashikant Bhoge (DIN 05345105) and Mr. Suraj Samat (DIN: 0587940) due to owing other Commitments has tender resignation from the post of director of the company with effect from December 19, 2023 and December 21, 2023 respectively. There is no other material reason for resignation.

In accordance with the Provision of the Section 152 (6)(e) of the Act Mrs. Vaishali Mulay (DIN: 06444900) will retire by rotation at the ensuring Annual General Meeting (AGM) and being eligible, offers himself for reappointment.

During the year under review Ms. Beena Khandelwal has resigned from the post of Company Secretary & Compliance Officer of the Company with effect from September 30, 2023. Board of Director of the Company on the recommendation of Nomination & Remuneration Committee appointed Mr. Sanjay Jha as a Company Secretary & Compliance officer of the Company with effect from November 8, 2023.

During the year under review Mr. Naresh Sasanwar has resigned from the post of Chief financial officer of the Company with effect from December 08, 2023. Further subsequent to the end of financial year Board of Director of the company on the recommendation of Nomination & Remuneration Committee appointed Mr. Navraj Bhatt as Chief Financial officer of the company with effect from June 04, 2024.

Independent Director of the Company have submitted the declarations of independence as required under Section 149(7) of the Companies Act, 2013 confirming that they meet the criteria of independence under section 149(6) of the Companies Act, 2013 and Regulation 16 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015. In the opinion of the Board, the Independent Directors fulfill the conditions specified in these regulations and are independent of the management. There has been no change in the circumstances affecting their status as Independent Directors of the Company.

The Board is also of the opinion that the Independent Directors of the Company possess requisite qualifications, experience and expertise in the field of finance, strategy, auditing, tax, risk advisory, financial services, infrastructure and real estate industry and they hold the highest standards of integrity.

In compliance with rule 6(1) of the Companies (Appointment and Qualification of Directors) Rules, 2014, all the Independent Directors have included their names in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

The details of familiarization Programme to Independent Director, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters is uploaded on the website of the Company at the link www.mep.ltd.

The Company complies with Secretarial Standards on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2) issued by the Institute of Company Secretaries of India.

As at March 31, 2024, the company does not have subsidiary company, Joint venture Company and Associate Company.

Further as on March 31, 2024 the company have 3 (Three) Joint venture in the form of Association of person (AOP):

Company has entered into a Joint venture with MEP Infrastructure Developers Limited namely MEPIDL MCL JV for the eight laning of the existing 4 lane road from 539.202 KM to 563 KM section of NH 3 (new National Highway 848), a distance of 23.800 kilometres to be executed on Engineering, Procurement, Construction (EPC).

During the financial year company has entered into a Joint Venture with Aquatech Solutions private Limited namely Aquatech MEPL JV for Jointly execution of Project for construction of underground Sewage network, Pumping Station and Sewage Treatment plant of 13 MLD Capacity of Khopoli Underground Sewerage Scheme for the Khopoli Municipal Council Maharashtra.

During the financial year company has entered into a Joint Venture with Aqautech Solutions Private Limited namely Aquatech- MEPL Nashik JV for Jointly development / Execution of contract of The Nashik Municipal Corporation for "Design, Construction, Supply, Erection, Testing and Commissioning of 11.5 MLD STP, 29.5 MLD TTP & allied works, followed by O&M of 60 months.

Further during the financial year ended March 31, 2024 no company become or ceased to be its Subsidiaries, Joint Venture or Associate company of the company.

The Company has not accepted any Deposits within the purview of Section 73 to 76 of the Companies Act, 2013 read with The Companies (Acceptance of Deposits) Rules, 2014. Further no amount on account of principal or interest on public deposits was outstanding as on March 31, 2024.

Further as on March 31, 2024 outstanding amount of Loan from Director is Rs. 2,50,00,000/- (Rupees Two Crores and Fifty Lakhs Only).

There are no significant material orders passed by the regulators/Courts/ tribunals which would impact the going concern status of the Company and its future operations.

The Company has an internal financial control system commensurate with respect to its financial statements which provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements. The Audit Committee has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. The Audit Committee has a process for timely check for compliance with the operating systems, accounting procedures and policies. Major risks identified by the businesses and functions are systematically addressed through mitigating action on continuing basis.

On the recommendation of Audit Committee and Board of Directors, the members at the 77^th Annual General Meeting held on September 30, 2023 had appointed M/s. S K Patodia & Associates LLP, Chartered Accountant (Firm Registration No. 112723W/W100962), as the Statutory Auditors of the Company for the term of five consecutive years i.e. from the conclusion of 77^th Annual General Meeting till 82^nd Annual General Meeting of the Company to be held in year 2028.

During the financial year under review our statutory Auditor firm converted into LLP.

The Report issued by M/s. S K Patodia & Associates LLP, Chartered Accountant on the financial statements of the Company for the financial year ended March 31, 2024 forms part of the Annual Report. There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. S K Patodia & Associates LLP, Statutory Auditor, in their report.

The Board of Directors of the Company has appointed M/s. Nidhi Bajaj & Associates, Practicing Company Secretary as Secretarial Auditor to conduct the Secretarial Audit and his Report for the financial year ended March 31, 2024 is appended to this Report as ANNEXURE II.

There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. Nidhi Bajaj & Associates, Practicing Company Secretary, in their Secretarial Audit Report for the financial year 2023-24.

In accordance with the provisions of section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014 as amended Company has maintained Cost record. Further audit of Cost records is not applicable upon company during the financial year under review.

During the financial year under review, the Statutory Auditors and Secretarial Auditor has not reported any instance of frauds committed in the Company by its officers or employees to the Audit committee or to the central Government under Section 143(12) of the Companies Act, details of which needs to be mentioned in this Report.

The Company has a Whistle Blower Policy in line with the provisions of the Section 177 of the Companies Act, 2013. This policy establishes a vigil mechanism for directors and employees to report their genuine concerns, actual or suspected fraud or violation of the Company's code of conduct.

The said mechanism also provides for adequate safeguards against victimisation of the persons who use such mechanism and makes provision for direct access to the chairman of the Audit Committee.

The administration of the vigil mechanism is being done through Audit Committee. We confirm that during the financial year ended March 31, 2024. no employee of the Company was denied access to the Audit Committee. The said Whistle Blower Policy is available on the website of the Company at www.mep.ltd

Your Company is committed to creating and maintaining an atmosphere in which employees can work together, without fear of sexual harassment, exploitation and intimidation. Your Company has complied with the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act 2013. Internal Complaints Committee (ICC) was set up to redress complaints received regarding sexual harassment.

The following is a summary of sexual harassment complaints received and disposed of during the year:

In terms of Regulation 15(2) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended from time to time, the compliance of provisions of the Corporate Governance under Regulation 27(2) of the Listing Regulations is not applicable to the Company as paid up equity share capital of the Company is not exceeding Rs. 10 Crores and net worth is not exceeding Rs. 25 Crores, as on the last day of previous financial year.

Pursuant to the provisions of the Listing Regulations, your Company has taken adequate steps to ensure that all mandatory provisions of Corporate Governance as prescribed under the Listing Regulations are complied with.

The Management's Discussion and Analysis Report for the financial year ended March 31, 2024, as stipulated under Regulation 34(2) of SEBI Listing Obligation and Disclosure Requirements) Regulation, 2015, is appended as ANNEXURE III to this report.

During the year Company does not have any employee who were receipt of remuneration of Rs. 1,02,00,000 (Rupees One Crores and Two Lakh Only) if employed for the full year and who were in receipt of remuneration of Rs. 8,50,000 (Rupees Eight Lakh and Fifty thousand Only) per month if employed for part of the year. Further Disclosures with respect to the remuneration of directors and employees as required under Section 197(12) of the Companies Act and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended has been appended as ANNEXURE IV to this Report.

As per the second proviso to Section 136(1) of the Companies Act and the second proviso of Rule 5 of the Companies (Appointment and Remuneration) Rules, 2014 the Directors' Report and Financial Statements are being sent to the Members of the Company excluding the statement of particulars of employees under Rule 5(2) of the Companies (Appointment and Remuneration) Rules, 2014. If any Member is interested in obtaining a copy thereof, the Member may write to the Company Secretary, whereupon a copy would be sent to such Member.

There are no applications made or any proceeding pending against the Company under Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the financial year.

During the financial year under review, there were no instances of one-time settlement with any bank or financial institution.

The Company does not have any shares lying in its Demat Suspense Account / Unclaimed Suspense Account.

There are no agreements with any party which impact the management or control of the Company or impose any restriction or create any liability upon the Company.

The Directors wish to place on record their appreciation and sincere thanks to the State Governments, Government agencies, Banks & Financial Institutions, joint venture partners, shareholders, vendors and other related organizations, who through their continued support and co-operation have helped, as partners in your Company's progress. The Directors, also acknowledge the hard work, dedication and commitment of the employees for the growth of the Company and look forward to their continued involvement and support.