Superior Finlease Ltd

2 Appointed w.e.f 28.03.2024

*Mrs Vineeta Loomba has resigned from the Board w.e.f. 05, April, 2024

The necessary quorum was present in all the meetings. The intervening gap between any two meetings was not more than one hundred and twenty days as prescribed by the Companies Act, 2013.

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and the applicable provisions of the Listing regulations.

During the year the separate meeting of the Independent Directors were held in accordance with the applicable provisions of Companies Act, 2013 without the attendance of non-independent directors and members of the Management, inter alia, to discuss the following:

• Reviewed the performance of Non-Independent Directors and the Board as a whole;

• Reviewed the performance of the Chairman of the Company, taking in to account the views of the Executive and Non-Executive Directors; and

• Assessed the quality, quantity and timeliness of flow of information between the Company management and the Board that is necessary for the Board to effectively and reasonably perform its duties

To the best of our knowledge and belief and according to the information and explanation obtained by us, your Directors make the following statements in terms of provisions of Section 134 (5) of the Companies Act, 2013, and hereby confirm that:

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation material departures;

(b) 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 the financial year and of the profit and loss of the company for that period;

(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, have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

(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.

The provision of section 139 of the Companies Act, 2013 requires that the statutory auditor may be appointed by the shareholders for a period of 5 (five) consecutive years. Accordingly, M/s. R. C. Agarwal & Co., (FRN: 003175N), Chartered Accountants were appointed as Statutory Auditors of the Company for the term of five years from the Annual General Meeting (AGM) held on 29th September, 2021.

The Audit Report as provided by the Statutory Auditors does not contain any qualification, reservation or adverse remark or disclaimer.

During the year under review, there were no frauds reported by the auditors to the Audit Committee or the Board under section 143(12) of the Companies Act, 2013.

As per the Cost Audit Orders, Cost Audit is not applicable to the Company's for the Financial Year 2023-24

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors in its meeting held on 06^th September, 2024 have appointed M/s Ranjan Jha & Associates, Practicing Company Secretaries as Secretarial Auditor to undertake the Secretarial Audit of the Company for the Financial Year 2023-2024.

The Secretarial Audit Report in prescribed Form MR-3 for the financial year ended 31^st March, 2024 is appended as Annexure-1 to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

Management Discussion and Analysis Report, highlighting the performance and prospects of the Company's business, forms part of the Annual Report.

As per Regulation 15 of the SEBI (Listing Regulations and Disclosure Obligations Requirements) Regulations, 2015, the Compliance with the corporate governance provisions as specified in Regulations 17, [17A,] 18, 19, 20, 21, 22, 23, 24, 24A, 25, 26, 27and clauses (b) to (i) and (t) of sub regulation (2) of Regulation 46 and para C, D and E of Schedule V are not applicable to the following class of companies:

The listed entity having Paid up Equity Share Capital not exceeding Rs.10 Crores and Net Worth not exceeding Rs.25 Crores, as on the last day of the previous financial year;

The Listed Entity which has listed its specified securities on the SME Exchange.

The members may please note that the Company is neither listed on the SME Exchange nor its paid- up share capital and net-worth exceeds the threshold limits as mentioned above, therefore is exempted from provisions of corporate governance as stated in Regulation 15 of the Securities and Exchange Board of India (LODR) Regulation, 2015.

Pursuant to the provisions of the Section 134, 178 and Sch. IV of the Companies Act, 2013, the following performance evaluations were carried out;

a. Performance evaluation of the Board, Chairman and non-Independent Directors by the Independent Directors;

b. Performance evaluation of the Board, its committees and Independent Directors by the Board of Directors; and

c. Performance evaluation of every director by the Nomination and Remuneration Committee. COMMITTEES OF THE BOARD OF DIRECTORS

The Board Committees play a crucial role in the governance structure of the Company and have been constituted to deal with specific areas related to the Company that need a closer review. The Board Committees are set up under the formal approval of the Board to carry out clearly defined roles which are considered as a part of good governance practice and the Board has constituted the following Committees and each Committee has their terms of reference as a Charter. The Company has constituted the various Committees in compliance with the applicable provisions of Companies Act, 2013. The Chairman of each committee along with the other Members of the Committee and if required other Members of the Board, decide the agenda, frequency and the duration of each meeting of that Committee. Currently, the Board has at the end of the year three committees:

I. Audit Committee

II. Nomination and Remuneration Committee

III. Stakeholders' Relationship Committee

The Audit Committee is, inter alia, entrusted with the responsibilities to monitor the financial reporting, audit process, determine the adequacy of internal controls, evaluate and approve transactions with related parties, disclosure of financial information and recommendation of the appointment of Statutory Auditors.

During the financial year under review, the committee met Five (5) times on 29^th May, 2023, 11^th August, 2023; 31^st August, 2023, 10^th, November, 2023; 12^th February respectively and all the recommendations of the audit committee were accepted by the Board. The composition and attendance of the members at the meeting are as follows:

The Nomination and Remuneration Committee broadly plays a dual role for determining the composition of the Board based on need and requirements of the Company from time to time and determines the overall compensation framework and policy for Directors, Senior Management and Employees. The Committee further reviews that the human resource practices of the Company are effective in maintaining and retaining a competent workforce.

During the financial year under review, the committee met 2 (Two) times on 15^th May, 2023, and 31^st August, 2023 respectively and all the recommendations of the Committee were accepted by the Board. The composition and attendance of the Members at the meetings are as follows:

The Stakeholders Relationship Committee was duly reconstituted during the year to give effect to the changes in the Board Composition. The composition of reconstituted Stakeholders Relationship Committee is mentioned below.

During the financial year under review, the committee met 4 (Four) times on 20^th May 2023, 31^st August 2023, 10^th November, 2023 and 12^th February, 2024. respectively and all the recommendations of the Audit Committee were accepted by the Board. The composition and attendance of the Members at the meetings are as follows:

Pursuant to the provisions of Section 188 of the Companies Act, 2013 read with the rules made there under and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company had not entered into any contract/arrangement/transaction with related parties which could be considered material. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. Accordingly, particulars of contracts or arrangements with related parties referred to in Section 188(1) of the Companies Act, 2013 in Form AOC-2 is not applicable.

The Company has adequate systems of internal control in place, which is commensurate with its size and the nature of its operations. The Company has designed and put in place adequate Standard Operating Procedures and Limits of Authority Manuals for conduct of its business, including adherence to Company's policies, safeguarding its assets, prevention and detection of fraud and errors, accuracy and completeness of accounting records and timely preparation of reliable financial information.

The Company's management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of

Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, 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, as required under the Act. The Audit Committee reviews the internal audit plans, adequacy and effectiveness of the Internal Control System, significant audit observations and monitors the sustainability of remedial measures.

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

However, Hon'ble Securities Appelate Tribunal has passed an order against the Director, Mr. Rajneesh Kumar, imposing a penalty of Rs 5,00,00,000 ( Rupes Five Crore) among others totaling Rs 11.90 Crore of fine on 19 entities in the matter of "Pump & Dump of Superior Finlease Shares".

Members are hereby informed that the review of the above said matter is under consideration with Hon'ble tribunal (SAT).

Pursuant to provisions of Section 135 of the Companies Act, 2013 read with the rules made there under, the criteria for companying with the CSR activity does not applicable to the Company throughout the year.

Company has limited scope for undertaking energy conservation exercises, but nevertheless continues to emphasize work practices that result in conservation of energy. At the offices of your Company, special emphasis is placed on installation of energy-efficient lighting devices, use of natural light as best as possible, and adoption of effective procedures for conservation of electricity, water, paper and other materials that consume natural resources.

Company did not absorb any new T echnology during the financial year.

C. FOREIGN EXCHANGE AND OUTGO</p>

There was no foreign exchange inflow or Outflow during the year under review VIGIL MECHANISM/WHISTLE BLOWERPOLICY

The Company in accordance with the provisions of Section 177(9) of the Companies Act, 2013 has established a vigil mechanism for directors and employees to report genuine concerns to the management viz. instances of unethical behaviour, actual or suspected, fraud or violation of the Company's Code of Conduct or Ethics Policy. The Company has also formulated a Whistle Blower Policy ("Policy") which provides for adequate safeguard against victimization of persons and has a provision for direct access to the Chairperson of the Audit Committee. The Company has not denied any person from having access to the Chairman of the Audit Committee. The details of the Whistle Blower policy are also available on the website of the Company http://www.superiorfinlease.com/investors/

Pursuant to the amendments to Section 134(3)(a) and Section 92(3) of the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return (Form MGT-7) for the financial year ended 31^st March 2024, is available on the Company's website and can be accessed at http://www.superiorfinlease.com/investors/.

The Company has complied with the applicable provisions of the Secretarial Standards issued by the Institute of Companies Secretaries of India.

Pursuant to Section 186 of the Companies Act, 2013 (the 'Act') read with Rule 11(2) of the Companies (Meetings of Board and its Powers) Rules, 2014, the loan made, guarantee given or security provided in the ordinary course of business by a Non- Banking Financial Company (NBFC) registered with Reserve Bank of India are exempt from the applicability of provisions of Section 186 of the Act. The details of Loans, Corporate Guarantees and Investments made during the year under the provisions of Section 186 of the Companies Act, 2013 are given in notes to the financial statements.

The information 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 below:

i) The ratio of the remuneration of each Director to the median remuneration of the employees of the company for the financial year: Not Applicable, as there is no remuneration paid to the director during the reporting period.

ii) The percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year: Not Applicable; there is no change in the remuneration of employees of the Company during the financial year under review.

iii) The percentage increase in the median remuneration of employees in the financial year:

Not Applicable; there is no change in the remuneration of employees of the Company during the financial year under review.

iv) The number of permanent employees on the rolls of company: 4

v) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration: Nil

vi) The key parameters for any variable component of remuneration availed by the directors: Nil

vii) Affirmation that the remuneration is as per the remuneration policy of the company: It is hereby affirmed that the remuneration paid during the year is as per the Remuneration Policy of the Company.

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection, appointment and remuneration of Directors, Key Managerial Personnel and employees in the Senior Management. In accordance with the provisions of Section 178 of the Act, the Board of Directors has adopted a Policy on Board Diversity and Director Attributes and the Remuneration Policy. The Policy on Board Diversity and Director Attributes has been framed to encourage diversity of thought, experience, knowledge, perspective, age and gender in the Board. The Remuneration Policy for Directors, Key Managerial Personnel and all other employees is aligned to the philosophy on the commitment of fostering a culture of leadership with trust. The Policy aims to ensure that the level and composition of the remuneration of the Directors, Key Managerial Personnel and all other employees is reasonable and sufficient to attract, retain and motivate them to successfully run the Company.

Risk Management Policy identifies, communicate and manage risks across the organization. The policy also ensures that responsibilities have been appropriately delegated for risk management. Key Risk and mitigation measures are provided in the 'Management Discussion and Analysis Report' as appended to this Annual Report.

As per provisions of Section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, your Company has constituted an Internal Complaints Committee for redressal of complaints against sexual harassment.

Further, the Company has always provided a congenial atmosphere for work to all the employees that is free from discrimination and harassment including sexual harassment. There were no complaints/cases filed/pending with the Company during the year.

As per the provision of section 124(1) of the Act, any money transferred to the Unpaid Dividend Account of a company which remains unpaid or unclaimed for a period of 7 (seven) years from the date of such transfer shall be transferred by the company along with interest accrued, if any, thereon to the Investor Education and Protection Fund established in accordance with section 125(1).

The members may please be informed that the Company has not declared any dividend in last years. Accordingly, there were no funds which were required to be transferred to Investor Education and Protection fund.

There was no fraud disclosed during the Financial Year ended 31^st March, 2024.

The 3,00,10,000 equity shares of Rs. 1/- each of the Company are listed on BSE Limited and Metropolitan Stock Exchange of India Limited. The Annual Listing Fees for the Financial Year 202425 has been submitted to the Stock Exchanges.

The Company conducts various promotional activities related to Safety, Health & Environment during National safety week, Road safety week & Fire service day. Quiz & poster contest, live demonstration of firefighting techniques, domestic & household safety for the students of neighbouring schools, employees children and people residing in surrounding community are taken up during those days.

As part of the safety performances following parameters were considered:

• Health & Safety Management systems

• Workers participation in Health & Safety

• Health & Safety Training

• Work Permit, tag out & lockout systems

• Internal & External Safety auditing, review process

• Promotion of safety & health at workplace

• Community awareness programs

• Safety of the contract workers

Cordial and conducive working conditions prevailed amongst the Company employees and the contract vendors.

The Company has complied and continues to comply with all the applicable regulations, circulars and guidelines issued by the Ministry of Corporate Affairs (MCA), Stock Exchange(s), Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI) and other statutory authority.

As a Non-Deposit taking Non-Banking Finance Company, your Company always aims to operate in compliance with applicable RBI laws and regulations and employs its best efforts towards achieving the same.

During the year under review, your Company has not provided any Stock Option Scheme to the employees.

During the year under review, no Right Issue was made in the financial year 2023-24.

None of the employees' remuneration exceeds the limit specified.

Electronic copies of the Annual Report for the FY 2023-24 and the Notice of the AGM were sent to all the members whose email addresses are registered with the Company / Depository Participants. Members whose Email addresses are not registered can send their request to company directly or may assess the Notice of the Annual General Meeting and the Annual Report for the year 2023-24 from the Company's website http://www.superiorfinlease.com/investors.php and also on the website of BSE Limited at https://www.bseindia.com/and Metropolitan Stock Exchange of India Limited at https://www.msei.in/ where the shares of the company are listed.

• There was no proceeding initiated or pending against the Company under the Insolvency and Bankruptcy Code, 2016.

• The Company has not made any one-time settlement for loans taken from the Banks or Financial Institutions, and hence 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 is not applicable.

The Company seeks to promote and follow the utmost level of ethical standards in the business transactions. The policies are formulated in accordance with the applicable provisions of Companies Act, 2013, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and RBI Laws as stipulated in the master directions for Non -banking Financial Companies. All the policies are available on the website of the Company viz. http://www.superiorfinlease.com.

The Policies are reviewed periodically by the Board and updated on the basis of need and new Compliance.

The Key Policies are as follows:

Your directors take this opportunity to offer their sincere thanks and gratitude to:

1. The bankers of the company as well as other Financial Institutions for the financial facilities and support.

2. Business associates, vendors/contractors, shareholders, employees and esteemed clients, customers for their support and assistance.

The Board also takes this opportunity to express their sincere appreciation of the efforts, dedication, commitment and contribution put in by the employees at all levels for achieving the results and hope that they would continue their sincere and dedicated endeavours towards achieving better working results during the current year.

SECRETARIAL AUDIT REPORT FOR THE FINANCIAL YEAR ENDED 31^st MARCH 2024 [Pursuant to section 204(1) of the Companies Act, 2013 and Rule No.9 of the Companies (Appointment and Remuneration Personnel) Rules, 2014]

To,

The Members,

NS-92, Khasra No-33/21, Ranaji Enclave, Najafgarh,

Near Arjun Park Bus Stand New Delhi - 110043

We have conducted the Secretarial Audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by Superior Finlease Limited (hereinafter referred to as the "Company"). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/ statutory compliances and expressing our opinion thereon.

Based on our verification of the Company's books, papers, minute books, forms and returns filed and other records maintained by the Company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit, we hereby report that in our opinion, the Company has, during the audit period covering the financial year ended on 31^st March, 2024 ("Audit Period"), complied with the statutory provisions listed hereunder and also that the Company has proper Board-processes and compliance-mechanism in place to the extent and in the manner reported hereinafter.

We have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for the financial year ended on 31^st March, 2024 according to the provisions of -

i. The Companies Act, 2013 ("the Act") and the rules made there under;

ii. The Securities Contracts (Regulation) Act, 1956 ("SCRA") and the Rules made under that Act;

iii. The Depositories Act, 1996 and the Regulations and Bye-laws framed under that Act;

iv. The Foreign Exchange Management Act, 1999 and the Rules and Regulations made under that Act to the extent applicable to Overseas Direct Investment (ODI) (Not Applicable as there was no reportable event during the period under review);

v. The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 ('SEBI Act'):

(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015;

(c) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009;-(Not Applicable as there was no reportable event during the period under review);

(d) The Securities and Exchange Board of India (Share based Employee Benefits) Regulations, 2014;-(Not Applicable as there was no reportable event during the period under review);

(e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008- (Not Applicable as there was no reportable event during the period under review);

(f) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies Act and dealing with client;

(g) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2021(Not Applicable as there was no reportable event during the period under review);

(h) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998-(Not Applicable as there was no reportable event during the period under review);

vi. Reserve Bank of India Act, 1934;

vii. Non-Banking Financial (Non-Deposit Accepting or Holding); Companies Prudential Norms (Reserve Bank) Directions, 2015;

We have also examined compliance with the applicable clauses of the following:

i. Secretarial Standards with regard to Meeting of Board of Directors (SS-1) and General Meetings (SS-2) issued by the Institute of Company Secretaries of India;

ii. SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Listing agreements entered into by the Company with BSE Limited and the Metropolitan Stock Exchange of India Limited.

The Board of Directors of the Company is duly constituted with the proper balance of Executive Directors, Non - Executive Directors and Independent Directors. The changes in the composition of the Board of Directors that took place during the period under review were carried out in compliance with the provisions of the Act.

Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent at least seven days in advance, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting.

All decisions at Board Meetings and Committee Meetings thereof carried out with requisite majority.

We further report that there are adequate systems and processes in the Company commensurate with the size and operations of the company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.

We further report that, Hon'ble Securities Appellate Tribunal (SAT) has levied a penalty on Director Mr Rajneesh Kumar in the matter of "Pump and Dump in the shares of Superior Finlease Limited" in respect of which, company has approached Hon'ble Tribunal (SAT) for resolving the matter and therefore the said matter is under consideration with the Hon'ble Tribunal (SAT) for review.

We further report that, as per Audit Report given by Statutory Auditors, the Company has pending litigation, on the financial position of the Company, with Enforcement Directorate, SEBI.

To,

The Members,

NS-92, Khasra No-33/21, Ranaji Enclave,

Najafgarh,Near Arjun Park Bus Stand,

New Delhi - 110043

Our report of even date is to be read along with this letter.

1. Maintenance of secretarial record is the responsibility of the management of the Company. Our responsibility is to express an opinion on these secretarial records based on our audit.

2. We have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctness of the contents of the Secretarial records. The verification was done on test basis to ensure that correct facts are reflected in secretarial records. We believe that the processes and practices, we followed provide a reasonable basis for our opinion.

3. We have not verified the correctness and appropriateness of financial records and Books of Accounts of the Company.

4. Wherever required, we have obtained the Management representation about the compliance of laws, rules and regulations and happening of events etc.

5. The compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards is the responsibility of management. My examination was limited to the verification of procedures on test basis.

6. The Secretarial Audit Report is neither an assurance as to the future viability of the Company nor of the efficacy or effectiveness with which the management has conducted the affairs of the Company.