Sarthak Industries Ltd

Dear Shareholders,

Your Directors have pleasure in presenting 40 Annual Report together with the Audited Statement of Accounts of the Company for the

year ended 31 March, 2024.

Further, in compliance with the Companies Act, 2013 the Company has made requisite disclosures in this Board's Report with the objective of accountability and transparency in its operations to make you aware about its performance and future perspective of the Company.

The audited financial statements of the Company as on 31 March, 2024 are prepared in accordance with the relevant applicable IND AS and Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") and provisions of the Companies Act, 2013 ("Act").

The performance of the Company for the financial year ended on 31 March, 2024 is summarized below:

[ Rs. In Lacs (Except EPS)]

As mandated by the Ministry of Corporate Affairs, the Company has adopted Indian Accounting Standards ("Ind AS") from 1 April, 2017. The financial statements of the Company for the financial year 2023-24 have been prepared in accordance with Ind AS, prescribed under Section 133 of the Companies Act, 2013 read with the Companies (Indian Accounting Standards) Rules, 2015 and the other recognized accounting practices and policies to the extent applicable.

Your Directors have decided to plough back the profits to the operational fund requirement of the Company. Hence, no dividend has been recommended for the year under review.

The Board of Directors has not proposed any amount for transfer to reserves for the year ended 31 March 2024.

During the year there was no change in the nature of business of the company.

During the year under review, Revenue from operations and Other Income of the Company stood at Rs. 3393.44 Lacs showing decreasing trend over the previous year Revenue from operations and Other Income Rs. 6,164.94 Lacs. Profit before tax has decreased and stood at Rs. 89.54 Lacs as compared to previous year figures Rs. 103.43 Lacs and Net Profit also decreased and stood at Rs. 67.60 Lacs as compared to previous year net profit Rs. 75.90 Lacs. Your Directors are hopeful for better performance in the coming years.

The Company has not accepted any deposits from the public within the meaning of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.

The Company has not received any unsecured loan from director during the financial year.

The Authorized Share Capital of the company as on March 31st, 2024 stood as Rs. 20,00,00,000 (Twenty Crore Rupees) comprising of Rs. 19,00,00,000 divided into 1,90,00,000 Equity shares of Rs. 10/- each and Rs. 1,00,00,000 divided into 1,00,000 Preference Share of Rs. 100/- each.

The Paid Up Equity Share Capital as on March, 31 2024 was Rs. 9,29,18,000 divided into 92,91,800 Equity shares of Rs. 10/- each.

Further the company has not issued any shares with differential voting rights, sweats equity shares, Bonus Shares and also not granted stock options as prescribed in Companies Act, 2013 and rules framed there under.

There were no funds which were required to be transferred to Investor Education and Protection Fund.

There has not been any such revision during the year under report.

All properties and insurable interests of the Company including Building and Plant & Machinery have been adequately insured.

Industrial relations were harmonious throughout the year. The Board wishes to place on record their sincere appreciation to the cooperation extended by all the employees in maintaining cordial relations.

A separate report on Corporate Governance in terms of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms integral part of this report. Certificate regarding compliance of conditions of Corporate Governance Report issued by Practicing Company Secretary is attached separately to this report.

Management Discussion and Analysis Report as required under Regulation 34 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is attached separately to this Annual Report.

To the best of their knowledge and belief, your Directors make the following statements in terms of Section 134(3) read with Section 134(5) of the Companies Act, 2013:

I) That in the preparation of the annual accounts for financial year ended 31 March, 2024; the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii) That the Directors 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/ loss of the Company for that period;

iii) That 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;

iv) That the Directors have prepared the annual accounts on a going concern basis;

v) That the Directors have laid down internal financial controls, which are adequate and are operating effectively;

vi) That 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.

Mr. Yogender Mohan Sharma has resigned from the post of Whole-Time Director of Company w.e.f. 17 May, 2023 due to his advancing age and certain health related issues. The Board appreciates the services rendered by him in the capacity of Whole-time Director.

Mr. Udesh Dassani, ceased to be the Non-executive Independent Director effective from 31 March, 2024 of the company as he completed his second tenure of five consecutive years.

The Board expresses their deep appreciation & gratitude to him for his valuable contribution and guidance during his association with the company.

Mr. Vijay Kumar Rathi, Non-Executive Independent Director of the company has resigned from the post of directorship w.e.f. closing

hours of 13 October, 2023 due to his advancing age and certain health related issues. The Board appreciates the services rendered by him in the capacity of Non-executive Independent Director.

The Board of Directors at its meeting held on 19 May, 2023 appointed Mr. Ajay Peshkar (DIN: 03094090) as Additional cum Whole-Time

Director of the Company for a period of three years w.e.f. 19 May, 2023 and approval of members of the company has been taken in the

39 Annual General Meeting held on 11 August, 2023.

The Board of Directors at its meeting held on 14 July, 2023 appointed Mrs. Ankita Hasmukhdas Sethi (DIN: 08467476) as an Additional

cum Independent Director of the Company for a term of five consecutive years with effect from 01 August, 2023 and approval of

members of the company has been taken in the 39 Annual General Meeting held on 11 August, 2023.

The Board of Directors at its meeting held on 14 July, 2023 appointed Mr. Shashikant Padgil (DIN: 07896216) as an Additional cum

Independent Director of the Company for a term of five consecutive years with effect from 01 August, 2023 and approval of members of

the company has been taken in the 39 Annual General Meeting held on 11 August, 2023.

Mr. Ajay Peshkar, Whole - Time Director of the Company retires by rotation in accordance with the provisions of the Articles of Association of the Company and being eligible offer himself for re-appointment.

In the opinion of the Board, the independent directors appointed during the year possess requisite integrity, expertise, experience and proficiency.

Details of the proposal for appointment/ re-appointment of Directors are mentioned in the Notice of the Annual General Meeting.

During the period under the review, there were no changes in the composition of the Key Managerial Personnel of the company.

During the year, declarations received from the Directors of the Company pursuant to Section 164 of the Companies Act, 2013. Board appraised the same and found that none of the director is disqualified holding office as director.

All Independent Directors have given declarations under section 149(7) that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

In compliance with Rule 6 of Companies (Appointment and Qualification of Directors) Rules, 2014, all Independent Directors of the Company have registered themselves with the India Institute of Corporate Affairs (IICA), Manesar and have included their names in the databank of Independent Directors within the statutory timeline. They have also confirmed that they will appear for the online proficiency test, wherever applicable.

In compliance with the requirements of Section 178 of the Act and Regulation 19 of the SEBI Listing Regulations, 2015, the Company has laid down a Nomination and Remuneration Policy which has been uploaded on the Company's website. The web-link as required under the Act is as under: https://www.sarthakindustries.com/.

The equity shares of the Company are listed on the BSE Limited (BSE). The listing fee for the year 2024-25 has already been paid to the Stock Exchange.

As on 31.03.2024, the Company does not have any subsidiary company or joint venture or associate company.

The Board met 11 times during the financial year. The details of which are given in the Corporate Governance Report that forms part of this annual report. The intervening gap between any two Meetings was within the period prescribed under the Companies Act, 2013.

During the year under review, one meeting of the Independent Directors was held on 14.02.2024, without the attendance of Executive Directors and members of management. All the Independent Directors were present in that meeting.

The details of the Committee Meetings and respective attendance of Members therein are provided in the Corporate Governance Report forming part of Annual Report

The Company has laid down a code of conduct for all Board members and Senior Management and Independent Directors of the Company. All the Board members including Independent Directors and Senior Management Personnel have affirmed compliance with the code of conduct. Declaration on adherence to the code of conduct is forming part of the Corporate Governance Report.

The Board of Directors has carried out an annual evaluation of its own performance, board committees, and individual directors pursuant to the provisions of the Act, SEBI Listing Regulations and the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5, 2017.

The Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its committees. The evaluation of all the directors and the Board as a whole was conducted based on the criteria and framework adopted by the Board. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non-Independent Directors was carried out by the Independent Directors who also reviewed the performance of the Secretarial Department. The Directors expressed their satisfaction with the evaluation process.

Details of the programmes for familiarization of the Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company, etc. are available on the website of the Company at the link: http://sarthakindustries.com/upload/investors_file/CTI1676637163.pdf

The Company has adequate internal financial control systems commensurate with its nature of business and size of the operations of the Company including adherence to Company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information and to monitor and ensure compliance with applicable laws, rules, and regulations.

The Company has also appointed an Internal Auditor as per the provisions of the Companies Act, 2013. The Company's internal audit process covers all significant operational areas and reviews the Process and Control. The Internal Auditor has authority to verify whether the policies and procedures, including financial transactions, are carried out in accordance with defined processes and variations and exceptions (if any) are justified and reported properly.

Your Company has not given any loans or guarantees or made investment beyond the limits mentioned under the provisions of Section 186 of the Companies Act, 2013.

All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of the business. During the year, the Company had not entered into any contract/ arrangement/ transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions. Thus, Form AOC 2 is not required.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company's website at the link:

A statement showing the disclosure of transactions with related parties as required under Ind AS 24 is set out separately in this Annual Report.

No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statements relate and the date of this report.

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, are given in the "Annexure A" forming part of this report.

Disclosure pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, are given in the "Annexure B" forming part of this report.

During the year under review, none of the employee of the company is drawing more than Rs.1,02,00,000/- per annum or Rs. 8,50,000/- per month for the part of the year. The information required under Rule 5(2) and (3) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in the Annexure forming part of this Report. In terms of the first provision to Section 136 of the Act, the Report and Accounts are being sent to the Members excluding the aforesaid Annexure. Any Member interested in obtaining the same may write to the Company Secretary at the Registered Office of the Company.

Further, none of directors is drawing any remuneration or commission from any subsidiary or associate companies.

The policy on Directors' Appointment and Remuneration including criteria for determining qualifications, positive attributes, independence of a director and other matters provided under sub-section (3) of Section 178 of the Companies Act, 2013, and under Regulation 19 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 adopted by the Board, The Details of the said Policy is available on website of the Company i.e. https://www.sarthakindustries.com/policy-and-disclosures and annexed as

The details pertaining to composition of Audit Committee are included in the Corporate Governance Report, which forms part of this report. All the recommendations made by the Audit Committee were accepted by the Board.

The Company has a Vigil Mechanism which also incorporates a Whistle Blower Policy in line with the provisions of the Companies Act, 2013 and the Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 to report genuine concerns or grievances. The Vigil Mechanism/ Whistle Blower Policy may be accessed on the Company's website i.e. www.sarthakindustries.com.

Pursuant to section 134 (3) (n) of the Companies Act, 2013 & Regulation 17(9) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of the Company has formed a Risk Management Committee to frame, implement and monitor the Risk Management Plan for the Company. The details of risk have been covered in the Management Discussion and Analysis Report forming part of the Board's report.

The Company has not developed and implemented any Corporate Social Responsibility initiatives as the said provisions are not applicable to the Company.

At the 39 Annual General meeting held for the financial year ended 31.03.2023 on 11 August, 2023, M/s ASHOK KHASGIWALA & CO. LLP, Chartered Accountants (Firm Registration No. 000743C/C400037), were appointed as the Statutory Auditors of the Company to the

Members for the period of five year from the conclusion of 39th Annual General Meeting of the Company till the conclusion of 44 Annual General Meeting of the Company.

Further, the company has received a certificate from the auditors confirming their eligibility to continue as Auditors of the Company in terms of the provisions of Section 141 of the Companies Act, 2013 and rules framed thereunder.

The notes referred to by the Auditors in their Report are self-explanatory and hence do not require any explanation. Further, there was no fraud in the Company, which was required to report by statutory auditors of the Company under sub-section (12) of Section 143 of Companies Act, 2013.

Further, there was no fraud in the Company, which was required to report by statutory auditors of the Company under sub-section (12) of Section 143 of Companies Act, 2013.

The Board has appointed M/s A. Goyal & Co., Cost Accountants, (Firm Registration No. 101308) as Cost Auditors of the Company for conducting the audit of cost records maintained by the Company for the financial year 2024-25. The Cost Audit Report for the year 2022-23 was filed with the Central Government within time.

Internal Audit for the year ended March 31, 2024 was done by M/s ‘S K Malani & Co' (Firm Registration Number: 159090W). The Board takes his suggestions and recommendations to improve and strengthen the internal control systems. The Audit Committee reviews adequacy and effectiveness of the Company's internal control environment and monitors the implementation of audit recommendations.

The Board has re-appointed M/s ‘S K Malani & Co.' (Firm Registration Number: 159090W), as Internal Auditor of the company for the year ended March 31, 2025.

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules made thereunder, the Company has appointed M/s Ajit Jain & Co., Practicing Company Secretaries to undertake the Secretarial Audit of the Company for the financial year 2023-24. The Secretarial Audit Report for the financial year 2023-24 is annexed herewith as "Annexure D" forming part of this report.

There are no adverse comments, qualifications or reservations or adverse remarks in the Secretarial Audit Report.

The Board of Directors has adopted the code as per SEBI (Prohibition of Insider Trading) Regulations, 2015; The Details of the said code is available on website of the Company at the weblink: http://sarthakindustries.com/upload/investors_file/CTI1618510757.pdf

The Business Responsibility Reporting as required by Regulation 34(2) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, is not applicable to your Company for the financial year ending March 31, 2024.

There are no significant and material orders passed by the regulator or courts or tribunals impacting the going concern status of the Company and future operations.

Not Applicable, as there was no One Time Settlement of loan taken from Banks or any financial Institutions. Hence, the difference in valuation does not arise

There is no application made or no proceeding pending under the Insolvency and Bankruptcy Code, 2016. There was no instance of onetime settlement with any Bank or Financial Institution.

The Company complies with all applicable mandatory secretarial standards issued by the Institute of Company Secretaries of India.

During the year under review, the Company has not failed to implement any Corporate Actions within the specified time limit.

Credit rating obtained along with revisions thereto for bank facilities of the Company during FY 2023-24 as under:

Pursuant to the provisions of Section 92(3) of the Companies Act, the annual return is available at Company's website http://sarthakindustries.com/annual-return.

The Company has in place an anti harassment policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. All employees (permanent, contractual, temporary, trainees) are covered under the policy. An Internal Complaints Committee (ICC) has also been set up to redress complaints received on sexual harassment. There was no complaint received from any employee during the financial year 2023-24 and hence no complaint is outstanding as on 31.03.2024 for redressal.

The Directors wish to convey their appreciation to all the employees of the Company for their enormous personal efforts as well as their collective contribution during the year. The Directors would also like to thank the shareholders, customers, suppliers, bankers, financial institutions and all other business associates for their continuous support given by them to the Company and their confidence in the management.