nagarjuna oil refinery limited › bseplus › annualreport › 534184 › ...nagarjuna oil refinery...

NAGARJUNA OIL REFINERY LIMITED

Board of Directors

K S RajuChairman

Chandra Pal Singh YadavNominee of KRIBHCO

Dr. N.C.B. Nath

S R Ramakrishnan

Lalitha Raghuram

K. Rahul Raju

K. Soma RajuManager

Registered OfficeD.No.8-2-248Nagarjuna Hills, PunjaguttaHyderabad - 500 082INDIA

CIN : L23200AP2010PLC071242

Websitewww.norl.co.in

AuditorsM/s. M Bhaskara Rao & Co.,Chartered AccountantsHyderabad - 500 082

Ankita MathurCompany Secretary

1


NOTICENOTICE IS HEREBY GIVEN THAT THE SEVENTH ANNUAL GENERALMEETING OF NAGARJUNA OIL REFINERY LIMITED WILL BE HELDAT 3.00 PM ON TUESDAY, DECEMBER 26, 2017, AT SRI SATYA SAINIGAMAGAMAM, 8-3-987/2, SRINAGAR COLONY, HYDERABAD - 500073 TO TRANSACT THE FOLLOWING BUSINESS:

ORDINARY BUSINESS

1. To receive, consider and adopt the 7th Annual Report ofthe Company, Balance Sheet as at March 31, 2017, theStatement of Profit and Loss for the financial year endedMarch 31, 2017, the Cash Flow Statement for the financialyear ended March 31, 2017 and the Reports of the Directorsand Auditors thereon.

2. To appoint a Director in place of Mr. K Rahul Raju withDIN No. 00015990 who has consented to retire by rotationin compliance with the requirements of Section 152 ofthe Companies Act, 2013, and being eligible, offershimself for re-appointment.

3. To consider and if thought fit, to pass with or withoutmodification(s) the following resolution as an OrdinaryResolution:

RESOLVED THAT pursuant to the provisions of Section 139of the Companies Act, 2013 and the Rules madethereunder, the consent of the Members be and is herebyaccorded for the ratification of the appointment ofStatutory Auditors of the Company, M/s. M Bhaskara Raoand Co., Chartered Accountants, Hyderabad (FirmRegistration No. 000459S), to hold office from theconclusion of the 7th Annual General Meeting up to theconclusion of the 8th Annual General Meeting of theCompany on such remuneration as may be fixed by theBoard of Directors during the term of appointment i.e.,from the conclusion of the 4th Annual General Meetingto the conclusion of the 9th Annual General Meeting.

SPECIAL BUSINESS

4. To consider and if thought fit, to pass with or withoutmodification(s) the following resolution as a SpecialResolution:

"RESOLVED THAT pursuant to the provisions of Sections196, 197, 203 and Schedule V and other applicableprovisions of the Companies Act, 2013, if any, Mr. K SomaRaju be and is hereby appointed as 'Manager' of theCompany for a period of 3 years with effect from August31, 2017."

"RESOLVED FURTHER THAT Mr. K Soma Raju be paid aconsolidated monthly remuneration of Rs. 10,000/- andother perquisites as per the Rules of the Company."

By Order of the Board

Ankita MathurCompany Secretary M.No ACS 24358

NOTES

1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETINGIS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTEINSTEAD OF HIMSELF AND SUCH A PROXY NEED NOT BE AMEMBER OF THE COMPANY.

A PERSON CAN ACT AS A PROXY ON BEHALF OF MEMBERSNOT EXCEEDING FIFTY AND HOLDING IN THE AGGREGATENOT MORE THAN TEN PERCENT OF THE TOTAL SHARE CAPITALOF THE COMPANY CARRYING VOTING RIGHTS. A MEMBERHOLDING MORE THAN TEN PERCENT OF THE TOTAL SHARECAPITAL OF THE COMPANY CARRYING VOTING RIGHTS MAYAPPOINT A SINGLE PERSON AS PROXY AND SUCH PERSONSHALL NOT ACT AS A PROXY FOR ANY OTHER PERSON ORSHAREHOLDER.

2. Instrument of proxies in order to be effective must bedeposited at the Company's registered office not lessthan 48 hours before the meeting.

3. Pursuant to the provisions of Section 108 of theCompanies Act, 2013 read with Rule 20 of the Companies(Management and Administration) Rules, 2014 andRegulation 44 of SEBI (Listing Obligations and DisclosureRequirements) Regulations, 2015, the Company isproviding remote e-voting facility for casting votes usingan electronic voting system from a place other than venueof the general meeting and voting at the general meetingthrough the ballot form on all the resolutions set forthin the Notice to the 7th Annual General Meeting to beheld on Tuesday i.e., December 26, 2017 at 3.00 PM.

The Company has engaged the services of CentralDepository Services (India) Limited to provide remote e-voting platform to the members.

Please refer to the detailed instructions on remotee-voting at page no. 45 of the Annual Report.

4. Members holding shares in demat form and memberswho have registered their email id with the Companywill also receive the remote e-voting instructions byemail .

5. Members who do not have access to remote e-votingfacility may use the enclosed Ballot Form on page 47and send their assent or dissent on or before close ofbusiness hours (5.00 PM) of December 25, 2017.

6. Members are requested to notify immediately thechange, if any, of the address /change in bank details tothe Company's registered office, quoting their ledger folionumber registered with the Company.

7. Members desiring to seek any information on the annualaccounts are requested to write to the Company at anearly date to enable compilation of information.

8. The Register of Members and the Share Transfer Bookswill remain closed from December 20, 2017 toDecember 26, 2017 (both days inclusive).

HyderabadNovember 08, 2017

2


9. The Company has paid the listing fees for the year 2017- 2018 to The Bombay Stock Exchange and the NationalStock Exchange of India Limited, Mumbai, where thesecurities of the Company are listed.

10. Members whose shareholding is in the electronic modeare requested to inform change of address, notificationsand updates of bank account details to their respectiveDepository Participants.

11. Members are requested to update the bank accountnumber allotted after implementation of Core BankingSolutions (CBS) to the Company in case of shares held inphysical form and to DP in case of shares held in dematform.

12. Members are requested to address all correspondencesto the Company's Registrars and Share Transfer Agents,XL Softech Systems Limited, 3, Sagar Society, Road No 2,Banjara Hills, Hyderabad, 500 034, India.

13. The Companies Act, 2013 and SEBI (Listing Obligationsand Disclosure Requirements) Regulations, 2015 permitsCompanies to mail soft copies of the Annual Report to all thosemembers who have registered their e-mail addresses with theCompany/Depository Participants. The Annual Report2016-2017 along with the Notice of the 7th Annual GeneralMeeting, instructions on remote e-voting, ballot form,attendance slip and proxy form is being mailed inelectronic mode to all the members whose emailaddresses are registered with the Company/DepositoryParticipants unless communication is received to thecontrary. Printed copies of the documents shall be mailedto members who have not registered their emailaddresses with the Company/Depository Participant orhave specifically requested for the same.

The Notice of the 7th AGM along with the Annual Report2016-2017 is also available on the Company's website -www.norl.co.in

14. To support green initiative, the Members holding shares bothin Physical/ Demat form, who have not furnished their e-mailids are requested to furnish the same to the Company/Depository Participants

15. As per Section 72 of the Companies Act, 2013 facility for makingnominations is available to individuals holding shares in theCompany. The prescribed nomination form can be obtainedfrom the Company. Members, in particular those holding sharesin single name, are requested to avail the above facility byfurnishing to the Company the particulars of their nomination.Members holding shares in electronic form may forward dulyfilled nomination form to their respective depository.

16. The Securities and Exchange Board of India has notified thatthe shareholders/transferee of shares (including joint holders)holding shares in physical form are required to furnish acertified copy of their PAN Card to the Company whiletransacting in the securities market including transfer,transmission or any other corporate action.

Accordingly, all the shareholders/transferee of shares

(including joint holders) are requested to furnish acertified copy of their PAN Card to the Company whiletransacting in the securities market including transfer,transmission or any other corporate action.

17. The Company has designated an exclusive e-mail idtitled [email protected] for redressalof members' complaints/grievances. In case you haveany queries/complaints or unresolved grievances,please write to Ms. Ankita Mathur, Company Secretary [email protected].

EXPLANATORY STATEMENT PURSUANT TOSECTION 102 OF THE COMPANIES ACT, 2013Item No. 4

The Board of Directors of the Company at their meeting heldon May 26, 2017 considered the re-appointment of Mr. K SomaRaju as Manager of the Company for a period of 3 years effectivefrom August 31, 2017 at a consolidated monthly remunerationof Rs. 10,000/- and other perquisites as per the Rules of theCompany.

The appointment of Mr. K Soma Raju as Manager of theCompany was approved by the Nomination and RemunerationCommittee of Directors, in terms of the requirements of theSection 196 and Schedule V to the Companies Act, 2013.

Mr. K Soma Raju is a B.Com graduate and a fellow member ofthe Institute of Chartered Accounts of India (ICAI). He has 38years of experience as a Chartered Accountant and as anentrepreneur. He worked as consultant in Nagarjuna groupand is a Director on the Board of various companies.

Your Directors commend the resolution for approval.

None of the Directors or Key Managerial Personnel of theCompany or their relatives are concerned or interested in thisresolution except Mr. K Soma Raju.

The Board commends the Special Resolution set out at ItemNo. 4 of the Notice for approval by the shareholders.

Inspection of Documents

The documents pertaining to Special Business are availablefor inspection at the Registered Office of the Companybetween 10.30 a.m. and 12.30 p.m. on any working day priorto the meeting.


Ankita Mathur Company Secretary

M.No ACS 24358HyderabadNovember 08, 2017

3


DIRECTORS' REPORTYour Directors present before you the 7th Annual Report of the Company together with the Audited Accounts for the year endedMarch 31, 2017.

The Financial Results of the company for the year ended March 31, 2017 are as under:

A. BUSINESS AND FINANCIAL HIGHLIGHTS

Standalone Financial Results Rs. in Lakhs

Particulars 2016-2017 2015-2016Current year Previous year

Net Sales/Income from Operations - -

Other Income 0.36 1.54

Total Expenditure

a . (Increase)/Decrease in Stock - -

b. Cost of materials consumed - -

c. Employee Benefits expense 157.39 150.94

d. Purchase of traded products - -

e. Power and fuel - -

f. Other expenses 195.65 167.98

Total 353.04 318.92

Finance cost 12.09 12.01

Depreciation and amortization 2.10 2.12

Profit/(Loss) before exceptional (366.87) (331.51)items, extra-ordinary items and tax

Exceptional Items 23,622.00 -

Profit/ (Loss) before extra-ordinary (23,988.87) (331.51)items and tax

Extra-ordinary items - -

Profit/(Loss) before tax (23,988.87) (331.51)

Provision for tax - -

Deferred tax - -

Profit after tax (23,988.87) (331.51)

Dividend – equity shares - -

Tax on proposed dividend - -

Balance c/d to Balance Sheet (23,988.87) (331.51)

Paid Up equity share capital 4281.82 4281.82(Face value of Re.1/- per share)

Reserves excluding revaluation reserve 8,190.59 32,179.46

Earnings per share (annualized)– in Rs.

Basic and Diluted (5.60) (0.08)

Financial Summary

The Loss after tax for the year was Rs.23,988.87 Lakhsagainst loss after tax of Rs.331.51 Lakhs for the previous

year.

The main contributors to the loss was on exceptional itemrepresenting a provision of Rs.23,622 lakhs towardsdiminution in the value of investment in Nagarjuna OilCorporation Limited (NOCL) in addition to Rs.40,000 Lakhsprovided in the year 2014-15, considering the delay ininduction of partner and consequently, achieving financialclosure for re-assessed cost of project.

Extension of time for holding Annual General Meeting

The Registrar of companies (ROC), Hyderabad, has grantedextension of time to the company for holding the 7th AnnualGeneral meeting, upto December 31, 2017.

Status of the Oil Refinery Project

Your company holds 46.78% of equity share capital ofNagarjuna Oil Corporation Limited (NOCL) which is involvedin setting-up a 6 MMTPA refinery project at Cuddalore,Tamil Nadu.

National Company Law Tribunal (NCLT), Chennai Bench hasadmitted the applications of the corporate creditors andinitiated the corporate insolvency resolution process underthe Insolvency and Bankruptcy Code, 2016. NCLT has appointedan Insolvency Resolution Professional for this purpose.

Consolidated Financial Statements

The Company in terms of Section 129(3) of the CompaniesAct, 2013, is required to prepare Consolidated FinancialStatements with the Annual Accounts of its AssociateCompany, Nagarjuna Oil Corporation Limited (NOCL) inaddition to Standalone Financial Statements for theyear ended March 31, 2017.

The Company had been perusing with NOCL for the AuditedAnnual Accounts for the year ended March 31, 2017. NOCL hasinformed that the Annual Accounts for the year endedMarch 31, 2017 were under the process of finalization.

NOCL vide letter dated July 28, 2017 has informed the Companythat National Company Law Tribunal had appointed anInsolvency Resolution Professional on July 26, 2017 andinitiated the corporate insolvency resolution process underthe Insolvency and Bankruptcy Code, 2016 and that NOCL wasnot in a position to draw up and provide its Annual Accountsfor the year ended March 31, 2017.

In view of the above, the Company, had sought extension oftime for holding 7th Annual General Meeting from theRegistrar of Companies, Telangana, for a period of threemonths up to December 31, 2017 and the same was granted.

4


The Company, despite follow-ups has not yet received theAudited Annual Accounts of NOCL for the preparation ofConsolidated Financial Statements for placing the samebefore the Members of the Company at the Annual GeneralMeeting to be held on December 26, 2017.

The Company, in order to meet the statutory requirementsunder Companies Act, 2013 and SEBI (Listing Obligations andDisclosure Requirement) Regulations, 2015 has convened the7th Annual General Meeting of the Members and ispresenting the Audited Accounts without incorporating theConsolidated Financial Statements for the year endedMarch 31, 2017 for the approval of the Members.

Share Capital

The paid-up equity capital of the company as on March 31,2017 is Rs.42,81,81,821/- consisting of 42,81,81,821 equity sharesof Re.1/- each.Subsidiaries, Joint Ventures or Associate Companies:There has been no change in relation to any subsidiary, jointventure or associate company during the year.Accounts of AssociatesPlease refer Note on Consolidated Financial Statementsabove.

The Details of Investment of the Company in Nagarjuna OilCorporation Limited (NOCL) an associate company is enclosedas Annexure - I

B. DIRECTORS, BOARD COMMITTEES, KEY MANAGERIAL PERSONNEL AND REMUNERATIONDirectors Retiring by RotationIn accordance with Section 152 of the Companies Act, 2013 andthe Articles of Association of the Company, Mr. K Rahul Rajuwho is liable to retire by rotation and being eligible, offershimself for re-appointment as Director of the Company, subjectto retirement by rotation.Resignation of DirectorDuring the year under review Mr. D Ranga Raju, Director of theCompany had vide letter dated February 01, 2017 resignedfrom the office of director of the company.The Board places on record the appreciations for the servicerendered by him during his tenure as Director of the Company.Declaration by Independent Directors:The Independent Directors have submitted their disclosureto the Board that they fulfill all the requirements as to qualifyas an Independent Director under Section 149(6) of theCompanies Act, 2013, as well as SEBI (Listing Obligations andDisclosure Requirements) Regulations, 2015.

Key Managerial Personnel:

Manager:

The Board has re-appointed Mr K Soma Raju as Manager ofthe company for a period of three years with effect from August31, 2017, subject to the approval of members of the Company.

There are no changes in relation to Key Managerial Personnelof the Company.

Meetings of the Board

The Board of Directors of your company, during the periodunder review met Five times on May 28, 2016, August 06, 2016,September 17, 2016, November 08, 2016 and February 09, 2017.

Remuneration and other particulars of the Directors/ Key ManagerialPersonnel/ Employees.

The information relating to remuneration and other particularsof the Directors/ Key Managerial Personnel/Employees asrequired under Section 197(12) of the Companies Act, 2013read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules, 2014 appearsas Annexure - II.

Personnel

In terms of the provisions of Section 197(12) of the CompaniesAct, 2013 read with Rules 5(2) and 5(3) of the Companies(Appointment and Remuneration of Managerial Personnel)Rules, 2014, a statement showing the names and otherparticulars of the employees drawing remuneration in excessof the limits set out in the said rules appears as Annexure -II I .

Committees

Audit Committee:

In compliance with the provisions of Section 177 of theCompanies Act, 2013 and Regulation 18 of SEBI (ListingObligations and Disclosure Requirements) Regulations, 2015(Erstwhile Listing Agreement) the company had constitutedan Audit Committee consisting of qualified and experiencedmembers from various fields. The Committee consists of threeIndependent Directors and one non-executive Director. TheChairman of the Committee is Dr. N C B Nath, an IndependentDirector. The Committee meets periodically to review theinternal audit report, quarterly Financial Results and AnnualFinancial Statements and recommends its decisions to theBoard apart from taking action independently wheneverrequired. The Statutory Auditors and Company Secretary attendthe Audit Committee Meetings.

The Audit Committee comprises of

Dr. N C B Nath : Chairman - Independent Director

Mr. S R Ramakrishnan : Member - Independent Director

Ms. Lalitha Raghuram : Member - Independent Director

Mr. K S Raju : Member

Nomination and Remuneration Committee:The Nomination and Remuneration Committee wasconstituted in compliance with the provisions of theCompanies Act, 2013 and Regulation 19 of SEBI (ListingObligations and Disclosure Requirements) Regulations, 2015(Erstwhile Listing Agreement).The Company has adopted a Nomination and RemunerationPolicy for determining, inter-alia, qualifications, positiveattributes and independence of a Director, matters relatingto the remuneration, appointment, removal and evaluation

5


of performance of the Directors, Key Managerial Personnel,Senior Management and other employees.Stakeholders Relationship Committee:The Stakeholders Relationship Committee was constitutedin compliance with the provisions of the Companies Act, 2013and Regulation 20 of SEBI (Listing Obligations and DisclosureRequirements) Regulations, 2015 (Erstwhile ListingAgreement).C. DISCLOSURESCompany Policy MattersYour company's endeavor has always been to maintaintransparency and accountability to its stakeholders. In thisdirection, various policies mentioned in the CorporateGovernance Report have been implemented to enable thestakeholders to appreciate the various interventions thecompany has taken.The implementation of these policies are reviewedperiodically by the Board of Directors and updated regularly.Risk Management Policy:The Board has put in place the Risk Management Policy forthe company to address various risks impacting the company.The company has setup an Enterprise Risk ManagementSystem to manage and mitigate risks.Policy on Board EvaluationThe Policy on Board Evaluation was adopted with effect fromNovember 10, 2014, by the Board of Directors in compliance ofCompanies Act, 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations, 2015.The purpose of the policy is to assess the effectiveness of theBoard as a whole, Committees of the Board and IndividualDirectors (Independent and Non-Independent) on regularbasis and to take necessary steps for improving theeffectiveness of the Board.The Nomination and Remuneration Committee has devisedthe methodology, identified sample tools for evaluation andalso laid down the parameters for evaluation of Non-ExecutiveDirectors, Independent Directors, Chairman, Board of Directorsand Committees of the Board.The Nomination and Remuneration Committee, have basedon the responses received from Directors, evaluated theDirectors, conveyed the opinion of the Committee to theDirectors, Committees and the Board.In view of the evaluation not linked to payment ofremuneration, the company has opted only for payment ofsitting fees, the evaluation has no financial implications onthe company.Whistle Blower Policy/Vigil MechanismThe company has formulated the policy on Whistle Blower/Vigil Mechanism in compliance with Clause 49 of ErstwhileListing Agreement. The same is in conformity with theRegulation 22 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 and Section 177(9) of theCompanies Act, 2013. The Policy aims to prohibit managerial

personnel from taking adverse personnel action againstemployees disclosing in good faith, alleged wrongful conducton matters of public concern involving violation of any law,mismanagement, misappropriation of public funds, amongothers.Employees aware of any alleged wrongful conduct areencouraged to make a disclosure to the Audit Committee.No personnel of the company were denied access to the AuditCommittee.Corporate Social ResponsibilityThe provisions relating to Corporate Social Responsibilitydoes not apply to the Company.Corporate GovernanceYour company firmly believes that building a culture ofcompliance is more than meeting regulations and standards.Your company is always proactive in meeting mandatedstandards and practicing Corporate Governance in spirit andnot just the letter of the law.As mandated by SEBI (Listing Obligations and DisclosureRequirements) Regulations, 2015 a report on CorporateGovernance along with a Certificate from Practicing CompanySecretary on the compliance of conditions of CorporateGovernance is annexed hereto. Your company is happy toinform you that there were no adverse remarks/qualifications/reservations raised in the Corporate Governance Report.Related Party Transactions

There are no contracts or arrangements entered into by thecompany with related parties in accordance with theprovisions of Section 188(1) of the Companies Act, 2013, otherthan the transaction entered into with Nagarjuna Fertilizersand Chemicals Limited pursuant to the order of thejurisdictional High Courts in relation to the Composite Schemeof Arrangement and Amalgamation between Ikisan Limited,Kakinada Fertilizers Limited, Nagarjuna Fertilizers andChemicals Limited and Nagarjuna Oil Refinery Limited.

The Policy on Related Party Transactions appears on thewebsite of the Company at www.norl.co.in.

Particulars of Loans, Guarantees or InvestmentsThe company has not provided any loans, guarantees or madeinvestments pursuant to Section 186 of the Companies Act,2013 other than executing a Sponsored Undertaking in favorof the lenders of Nagarjuna Oil Corporation Limited.

Conservation of Energy, Technology Absorption, Foreign ExchangeEarnings and Outgo

In relation to the information required to be furnished underthe Companies Act, 2013 read with Companies (Accounts)Rules, 2014, the company is not undertaking any manufacturingactivity and accordingly there is no information availablepertaining to Conservation of Energy and TechnologyAbsorption. There is no Foreign Exchange Earnings and Outgo.

Extract of Annual Return

The Extract of the Annual Return for the year ended March 31,2017 appears as Annexure- IV to this report.

6


Significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and Company'soperations in futureThere were no orders passed by Regulators or Courts orTribunals impacting the going concern status and futurebusiness operations of the Company.Adequacy of Internal Financial ControlsThe Company has established and is maintaining internalcontrols and procedures based on the internal control overfinancial reporting criteria established by the Company.The Board of Directors have evaluated the effectiveness ofthe Company's internal financial controls and procedures andconfirm that they are adequate in all material respects basedon the size and the nature of its business and such internalfinancial controls over financial reporting were operatingeffectively as at March 31, 2017.DepositsThe Company has not accepted any deposits within thepurview of the Companies Act, 2013 and the Rules made thereunder during the Financial Year 2016-17.AUDITORS AND AUDIT REPORTStatutory AuditorsM/s. M Bhaskara Rao & Co., Chartered Accountants (FirmRegistration No-000459S), Hyderabad, were appointed as theStatutory Auditors' for a term of five (5) years commencingfrom the conclusion of the 4th Annual General Meeting up tothe conclusion of the 9th Annual General Meeting subject toratification by the members of the company every year at theAnnual General Meeting.M/s. M Bhaskara Rao & Co have signified their willingness toaccept ratification of appointment and have further confirmedtheir eligibility under Section 141 of the Companies Act, 2013.The company's Statutory Auditors have also furnished acertificate from the Peer Review Board of the ICAI confirmingthat they have undergone the process of peer review.The Board of Directors in accordance with the provisions ofSection 139 of the Companies Act, 2013 and Rules madethereunder commend the ratification of the appointment ofStatutory Auditors for the Financial Year 2017-18 forconsideration of the members.Statutory Audit ReportThere are no adverse comments in the Report of the StatutoryAuditors' of the Company.Secretarial AuditorThe Board of Directors have appointed Mr. C S S Krishna,Partner, M/s KBG Associates, Company Secretaries, Hyderabadas the Secretarial Auditor of the Company to undertakeSecretarial Audit for the Financial Year 2017-18.Secretarial Audit ReportThe Secretarial Audit Report for the Financial Year 2016-17appears as Annexure - V to this Report. There are noqualifications or adverse remarks in the report.Internal AuditThe Company has a well established system of Internal Auditwhich carries out audit on Risk Management frameworkcovering all the functions.

An Internal Auditor of the company has been appointed bythe Board of Directors, in compliance with the Companies Act,2013 and SEBI (Listing Obligations and DisclosureRequirements) Regulations, 2015.D. DIRECTORS RESPONSIBILITY STATEMENT:Pursuant to Section 134(3)(c) and 134(5) of the Companies Act,2013, the Board of Directors of the Company hereby report:-(a) in the preparation of the annual accounts, the applicable

Accounting Standards had been followed along withproper explanation relating to material departures;

(b) the Directors had selected such accounting policies andapplied them consistently and made judgments andestimates that are reasonable and prudent so as to givea true and fair view of the state of affairs of the companyat the end of the financial year and of the profit and lossof the company for that period;

(c) the Directors had taken proper and sufficient care forthe maintenance of adequate accounting records inaccordance with the provisions of this Act for safeguardingthe assets of the company and for preventing anddetecting fraud and other irregularities;

(d) the Directors had prepared the annual accounts on agoing concern basis; and

(e) the Directors, in the case of a listed company, had laiddown internal financial controls to be followed by thecompany and that such internal financial controls areadequate and were operating effectively.

(f) the Directors had devised proper systems to ensurecompliance with the provisions of all applicable lawsand that such systems were adequate and operatingeffectively.

ACKNOWLEDGEMENTYour Directors place on record their gratitude to theGovernment of India, the financial institutions and Company'sbankers for their assistance and cooperation.Further, the company places on record its sincere appreciationfor the continuing support and unstinting efforts of investors,associates and all stakeholders.


Hyderabad K S RajuNovember 08, 2017 Chairman

7


ANNEXURES TO DIRECTORS’ REPORT Annexure – I

Statement containing salient features of the financial statement ofSubsidiaries/ Associate Companies/ Joint Ventures

Form AOC-I(Pursuant to first proviso to sub-section (3) of Section 129 of the CompaniesAct, 2013, read with rule 5 of Companies (Accounts) Rules, 2014)Part “A”: Subsidiaries

Particulars Subsidiary Step downSubsidiary

Reporting period for the subsidiary - -concerned, if different from theholding company’s reporting periodReporting currency and Exchange - -rate as on the last date of therelevant Financial year in thecase of foreign subsidiariesShare capital - -Reserves & surplus - -Total assets - -Total Liabilities - -Investments - -Turnover - -Profit/(Loss) before taxation - -Provision for taxation - -Profit after taxation - -Proposed Dividend - -% of shareholding - -

Particulars Nagarjuna Oil CorporationLimited (NOCL)

1. Latest audited Balance Sheet Date -2. Shares of Associate/Joint Ventures 77,62,20,000

held by the company on the yearend No.Amount of Investment in Associates Rs.77622 Lakhs/Joint VentureExtent of Holding % 46.78%

3. Description of how there is By virue of shareholdingsignificant influence

4. Reason why the Associate/Joint -Venture is not consolidated

5. Net worth attributable to Share -holding as per latest auditedBalance Sheet

6. Profit / Loss for the year -Considered in Consolidation -Not Considered in Consolidation -

Part “B”: Associates and Joint VenturesStatement pursuant to Section 129 (3) of the Companies Act, 2013related to Associate Companies and Joint Ventures


Hyderabad K S RajuNovember 08, 2017 Chairman

Annexure - IIParticulars of Remuneration of Directors / Key Managerial Personnel /Employees(Pursuant to Sec.197(12) of the Companies Act, 2013 read with Rule 5(1) ofCompanies (Appointment and Remuneration of Managerial Personnel) Rules,2014).1. The ratio of the remuneration of each director to the median

remuneration of the employees of the company for the Financial Year2016-17 - Not applicable as there is no Executive Director on the Boardof the company.

2. The Percentage increase in remuneration of Manager, Chief FinancialOfficer, Company Secretary in the financial year 2016-17

S. Name Designation 2015-16 2016-17 PercentageNo. Increase

of salary1. K Soma Raju Manager 122333 143667 17.44%2. A Sudhakara Rao CFO 3636759 4888493 34.42%3. Ankita Mathur Company 1051101 1084911 3.22%

Secretary

3. The percentage increase in the median remuneration of employees inthe Financial Year 2016-17

Particulars Percentage Increase of Median salaryMedian Salary 121.21%

4. The number of permanent employees on the rolls of the company.Particulars 2015 - 16 2016 - 17No of Employees 5 5

5. The explanation on the relationship between average increase inremuneration and Company Performance - Not applicable as thecompany is not undertaking any commercial activity

6. Comparison of the remuneration of the Key Managerial Personnelagainst performance of the company - Not applicable as the companyis not undertaking any commercial activity

7. Variations in the Market Capitalisation of the company, Price EarningsRatio as at the closing date of the current financial year and previousfinancial year and percentage increase over decrease in the marketquotations of the shares of the company in comparison to the rate atwhich the company came out with the last public offer in case oflisted companies, and in case of unlisted companies , the variations inthe net worth of the company as at the close of the Current FinancialYear and Previous Financial Year - Not applicable as the company isnot undertaking any commercial activity

8. Average Percentile increase already made in the salaries of employeesother than the managerial personnel in the last financial year and itscomparison with the percentile increase in the managerialremuneration and justification thereof and point out if there are anyexceptional circumstances for increase in the managerialremuneration – 12.57% for employees except Manager and noremuneration is paid to Directors.

9. The key parameters for any variable component of remunerationavailed by the Directors – There is no variable component ofremuneration paid to Directors.

10. The ratio of the remuneration of the highest paid director to that ofthe employees who are not directors, but receive remuneration inexcess of the highest paid director during the year 2016-17 - Notapplicable as there are no Executive Directors on the Board.

11. Affirmation that the remuneration is as per the remuneration policyof the company – The Remuneration paid is as per the remunerationpolicy of the company.

Note : The Company has not received the audited annual account of NOCL for the year endedMarch 31, 2017. Hence the Company could not provide the financial information for the same.

8


Annexure - IIIStatement of particulars of employees (pursuant to Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules, 2014)

S. Name Designation Remuneration Nature of Qualifi- Years of Date of Age Last Percentage RelationNo. Received Employment cations Experience Commence- employment of equity with

ment of held by share DirectorEmployment employee held or

before joining Manager1 Mr. Sudhakar Vice-President 7672382 Contractual B.Com., 43 01.04.2011 66 Executive None None

Kudva Corporate (Hons), Director,Affairs F.C.A Arcelar Mittal-

Algeria

Annexure – IVEXTRACT OF ANNUAL RETURN

Form No. MGT-9 as on the financial year ended on March 31, 2017[Pursuant to section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS:CIN L23200AP2010PLC071242Registration Date November 16, 2010Name of the Company Nagarjuna Oil Refinery LimitedCategory / Sub-Category of the Company Public Company Limited by SharesAddress of the Registered office and contact details D.No. 8-2-248, Nagarjuna Hills, Punjagutta, Hyderabad, Telangana-500 082Whether listed company YesName, Address and Contact details of Registrar and XL Softech Systems Limited,Plot No. 3, Sagar Society, Road No.2, BanjaraTransfer Agent, if any Hills, Hyderabad, Telangana - 500 034

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANYAll the business activities contributing 10 % or more of the total turnover of the company shall be stated:-

Sl. Name and Description of main NIC Code of the % to total turnoverNo. products / services Product/ service of the company1. Promoting, conceiving, planning, coordinating, executing and NA NIL

monitoring setting up of business relating to extraction of oil

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES

S. Name and Address of the Company CIN/GLN Holding/ % of shares ApplicableNo. Subsidiary/ held Section

Associate1. Nagarjuna Oil Corporation Limited U30006TN1991PLC020837 Associate 46.78% Sec 2(6)

IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)i) Category-wise Share Holding

A. Promoters (1) Indian

a ) Individual / HUF - - - - - - - - -b) Central Govt. - - - - - - - - -c) State Govt. 1,94,79,990 - 1,94,79,990 4.55% 1,94,79,990 - 1,94,79,990 4.55% 0.00%d) Bodies Corporate 13,02,39,652 - 13,02,39,652 30.42% 13,02,39,652 - 13,02,39,652 30.42% 0.00%e) Banks / FI - - - - - - - - -f) Any Other … 1,00,00,000 - 1,00,00,000 2.34% 1,00,00,000 - 1,00,00,000 2.34% 0.00%

(Co-op Society)Sub-total (A) (1):- 15,97,19,642 - 15,97,19,642 37.30% 15,97,19,642 - 15,97,19,642 37.30% 0.00%

% Changeduring the

year

Category of ShareholdersNo. of Shares held at the beginning of the year No. of Shares held at the end of the yearDemat Physical Total % of Demat Physical Total % of

Total TotalShares Shares

9


(2) Foreign a) NRIs - Individuals - - - - - - - - -b) Other – Individuals - - - - - - - - -c) Bodies Corporate 40,00,000 - 40,00,000 0.93% 40,00,000 - 40,00,000 0.93% 0.00%d) Banks / FI - - - - - - - - -e) Any Other …. 80,00,000 - 80,00,000 1.87% 80,00,000 - 80,00,000 1.87% 0.00%

NRI based CompanySub-total (A) (2):- 1,20,00,000 - 1,20,00,000 2.80% 1,20,00,000 - 1,20,00,000 2.80% 0.00%

Total shareholding ofPromoter (A)=(A)(1)+(A)(2) 17,17,19,642 - 17,17,19,642 40.10% 17,17,19,642 - 17,17,19,642 40.10% 0.00%B. Public Shareholding

1. Institutionsa) Mutual Funds 2,900 2,09,750 2,12,650 0.05% 2,900 2,09,750 2,12,650 0.05% 0.00%b) Banks / FI 16,200 56,176 72,376 0.02% 39,200 56,176 95,376 0.02% 0.00%c) Central Govt - - - - - - - - -d) State Govt(s) - - - - - - - - -e) Venture Capital Funds - - - - - - - - -f) Insurance Companies 73,76,752 100 73,76,852 1.72% 73,76,752 100 73,76,852 1.72% 0.00%g) FIIs 1,17,339 30,250 1,47,589 0.03% 97,339 30,250 1,27,589 0.03% 0.00%h) Foreign Venture - - - - - - - - -

Capital Fundsi) Others - - - - - - - - -

Sub-total (B)(1):- 75,13,191 2,96,276 78,09,467 1.82% 75,16,191 2,96,276 78,12,467 1.82 0.00%2. Non-Institutions

a) Bodies Corp.i) Indian 4,47,28,654 3,29,472 4,50,58,126 10.52% 4,50,68,373 3,25,522 4,53,93,895 10.60% 0.00%ii) Overseas - - - - - - - - -

b) Individualsi) Individual share 12,24,52,296 3,68,66,640 15,93,18,936 37.21% 12,73,27,417 3,64,00,898 16,37,28,315 38.24% 0.01%

holders holdingnominal sharecapital uptoRs. 1 lakh

ii) Individual share 1,35,04,086 - 1,35,04,086 3.15% 87,59,126 - 87,59,126 2.05% -0.01%holders holdingnominal sharecapital in excess ofRs. 1 lakh

c) OthersNRI 53,85,197 8,90,040 62,75,237 1.47% 54,15,409 8,67,840 62,83,249 1.47% 0.00%Trusts 2,43,76,552 1,19,475 2,44,96,027 5.72% 2,43,65,552 1,19,275 2,44,84,827 5.72% 0.00%Foreign National 300 - 300 0.00% 300 - 300 0.00% 0.00%Sub-total (B)(2):- 21,04,47,085 3,82,05,627 24,86,52,712 58.07% 21,09,36,177 3,77,13,535 24,86,49,712 58.07% 0.00%

Total Public Shareholding(B)=(B)(1)+ (B)(2) 21,79,60,276 3,85,01,903 25,64,62,179 59.90% 21,84,52,368 3,80,09,811 25,64,62,179 59.90 0.00%

C. Shares held by Custodian forGDRs & ADRs - - - - - - - - -Grand Total (A+B+C) 38,96,79,918 3,85,01,903 42,81,81,821 100.00% 39,01,72,010 3,80,09,811 42,81,81,821 1 0 0 0.00%

% Changeduring

the year

Category of ShareholdersNo. of Shares held at the beginning

of the yearNo. of Shares held at the end of the year

Demat Physical Total % of Demat Physical Total % ofTotal Total

Shares Shares

10


% Changeduring the

year

ii) Shareholding of Promoters

Core- Promoter1. Amlika Mercantile Private Limited 130239652 30.42%* 24.70% 130239652 30.42%* 24.70% 0.00%

Co- Promoter2. Fireseed Limited 8000000 1.87% - 8000000 1.87% - 0.00%3. Governor of Andhra Pradesh 19479990 4.55% - 19479990 4.55% - 0.00%4. KRIBHCO 10000000 2.34% - 10000000 2.34% - 0.00%5. Saipem SPA 4000000 0.93% - 4000000 0.93% - 0.00%

Total 171719642 40.10% 24.70% 171719642 40.10% 24.70% 0.00%

Sl.No.

Share holders Shareholding at the Share holding at theName beginning of the year end of the year

No. ofShares

% of totalShares of

theCompany

% of SharesPledged /

encumberedto totalshares

No. ofShares

% of totalShares of

theCompany

% of SharesPledged /

encumberedto totalshares

*Notes1. Amlika Mercantile Private Limited (Amlika) is the Core Promoter of the company consequent to the disclosures received from

Amlika, that a Scheme of Amalgamation between Nagarjuna Corporation Limited (NCL) and Amlika was approved by the Hon'bleHigh Court of Bombay at Mumbai on May 2, 2014 and the Scheme was made effective on June 19, 2014 in terms of which the equityshares held by NCL in NORL were vested in Amlika

2. NCL had vide letter dated November 11, 2012 informing that a Composite Schème of Arrangement and Amalgamation betweenNagarjuna Corporation Limited (NCL), Nagarjuna Management Services Private Limited (NMS), Nagarjuna Holdings Private Limited(NHPL), Baron Properties Private Limited (BPPL), White Stream Properties Private Limited (WSPPL) and Growth Stream PropertiesPrivate Limited (GSPPL) and their respective shareholders was approved by the Hon'ble High Court of Bombay at Mumbai onSeptember 14, 2012. The Scheme was made effective on November 9, 2012 and necessary disclosures and reports were filed withBSE, NSE and SEBI. Pursuant to the scheme NMS, NHPL, BPPL and WSPPL were merged into NCL. The equity shares held by thesecompanies shall be transferred to NCL after temporary lift of pledge by the banks to whom they are pledged and shall be pledgedback again by NCL.

3. Accordingly all the shares mentioned above in points 1 and 2 and the shares held by NCL shall vest in Amlika pursuantto the Scheme of which certain shares have been transfered to Amlika and the same shall be the Promoter with effectfrom June 19, 2014.

(iii) Change in Promoters’ Shareholding

Sl.No.

Shareholding at the beginningof the year

Cumulative shareholdingduring the year

No. ofshares

% of totalshares of the

Company

No. ofshares


Company

At the beginning of the year

- - - -

At the end of the year

- - - -

Name

11


At the beginning of the year

1. Zuari Global Limited 29334310 6.85% 29334310 6.85%Sold 19513000 shares between 27.03.2017 and 31.03.2017 9821310 2.29%

2. NFCL Employees Welfare Trust 24356052 5.69% 24356052 5.69%3. Life Insurance Corporation of India 5373875 1.26% 5373875 1.26%4. Lok Prakashan Ltd. 2440784 0.57% 2440784 0.57%5. Profitex Shares and Securities Private Limited 1200000 0.28% 1200000 0.28%6. United India Insurance Company Linited 1193808 0.28% 1193808 0.28%7. Anil Kumar Varshney 1120606 0.26% 1120606 0.26%

Acquired 30870 shares between 16.05.2016 and 20.05.2016 1151476 0.27%Acquired 448524 shares between 23.05.2016 and 27.05.2016 1600000 0.37%Acquired 204057 shares between 06.06.2016 and 10.06.2016 1804057 0.42%Acquired 456569 shares between 13.06.2016 and 17.06.2016 2260626 0.53%Acquired 327000 shares between 04.07.2016 and 08.07.2016 2587626 0.60%Acquired 36081 shares between 11.07.2016 and 15.07.2016 2623707 0.61%Sold 80000 shares between 26.09.2016 and 30.09.2016 2543707 0.59%Acquired 4176 shares between 03.10.2016 and 07.10.2016 2547883 0.60%Acquired 1439 shares between 10.10.2016 and 14.10.2016 2549322 0.60%Acquired 58385 shares between 17.10.2016 and 21.10.2016 2607707 0.61%Acquired 189467 shares between 24.10.2016 and 28.10.2016 2797174 0.65%Acquired 1033 shares between 31.10.2016 and 04.11.2016 2798207 0.65%Acquired 2554 shares between 07.11.2016 and 11.11.2016 2800761 0.65%Acquired 27446 shares between 14.11.2016 and 18.11.2016 2828207 0.66%Sold 99207 shares between 28.11.2016 and 02.12.2016 2729000 0.64%Sold 139490 shares between 05.12.2016 and 09.12.2016 2589510 0.60%Sold 251371 shares between 12.12.2016 and 16.12.2016 2338139 0.55%Sold 30000 shares between 19.12.2016 and 19.12.2016 2308139 0.54%Sold 283477 shares between 20.12.2016 and 23.12.2016 2024662 0.47%Acquired 50000 shares between 26.12.2016 and 30.12.2016 2074662 0.48%Acquired 101297 shares between 02.01.2017 and 06.01.2017 2175959 0.51%Acquired 19086 shares between 16.01.2017 and 20.01.2017 2195045 0.51%Sold 153200 shares between 06.02.2017 and 10.02.2017 2041845 0.48%Sold 908815 shares between 13.02.2017 and 17.02.2017 1133030 0.26%Sold 652900 shares between 20.02.2017 and 24.02.2017 480130 0.11%Sold 37156 shares between 27.02.2017 and 03.03.2017 442974 0.10%Sold 415668 shares between 06.03.2017 and 10.03.2017 27306 0.01%

8 Karvy Stock Broking Ltd 897296 0.21% 897296 0.21%Sold 7654 shares between 04.04.2016 and 08.04.2016 889642 0.21%Acquired 12559 shares between 11.04.2016 and 15.04.2016 902201 0.21%Acquired 609 shares between 18.04.2016 and 22.04.2016 902810 0.21%Sold 4031 shares between 25.04.2016 and 29.04.2016 898779 0.21%Sold 246 shares between 02.05.2016 and 06.05.2016 898533 0.21%Sold 12054 shares between 09.05.2016 and 13.05.2016 886479 0.21%Sold 3088 shares between 16.05.2016 and 20.05.2016 883391 0.21%Acquired 9007 shares between 23.05.2016 and 27.05.2016 892398 0.21%Acquired 7963 shares between 30.05.2016 and 03.06.2016 900361 0.21%Sold 51625 shares between 06.06.2016 and 10.06.2016 848736 0.20%Acquired 101021 shares between 13.06.2016 and 17.06.2016 949757 0.22%Acquired 2796 shares between 20.06.2016 and 24.06.2016 952553 0.22%

(iv) Shareholding Pattern of top ten shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):

Sl.No.

Shareholding at thebeginning of the year

Cumulative shareholdingduring the year

No. ofshares


Company

No. ofshares


Company

For Each of the Top 10 Shareholders

12


Acquired 24318 shares between 27.06.2016 and 30.06.2016 976871 0.23%Acquired 30260 shares between 01.07.2016 and 01.07.2016 1007131 0.24%Sold 50708 shares between 04.07.2016 and 08.07.2016 956423 0.22%Sold 17171 shares between 11.07.2016 and 15.07.2016 939252 0.22%Acquired 9035 shares between 18.07.2016 and 22.07.2016 948287 0.22%Acquired 76316 shares between 25.07.2016 and 29.07.2016 1024603 0.24%Acquired 158031 shares between 01.08.2016 and 05.08.2016 1182634 0.28%Acquired 63072 shares between 08.08.2016 and 12.08.2016 1245706 0.29%Acquired 73718 shares between 16.08.2016 and 19.08.2016 1319424 0.31%Sold 7572 shares between 22.08.2016 and 26.08.2016 1311852 0.31%Acquired 673 shares between 29.08.2016 and 02.09.2016 1312525 0.31%Acquired 139 shares between 05.09.2016 and 09.09.2016 1312664 0.31%Acquired 6538 shares between 12.09.2016 and 16.09.2016 1319202 0.31%Acquired 36324 shares between 19.09.2016 and 23.09.2016 1355526 0.32%Acquired 1686 shares between 26.09.2016 and 30.09.2016 1357212 0.32%Sold 7646 shares between 03.10.2016 and 07.10.2016 1349566 0.32%Acquired 21032 shares between 10.10.2016 and 14.10.2016 1370598 0.32%Acquired 114774 shares between 17.10.2016 and 21.10.2016 1485372 0.35%Acquired 58767 shares between 24.10.2016 and 28.10.2016 1544139 0.36%Sold 27198 shares between 31.10.2016 and 04.11.2016 1516941 0.35%Sold 18238 shares between 07.11.2016 and 11.11.2016 1498703 0.35%Acquired 11647 shares between 14.11.2016 and 18.11.2016 1510350 0.35%Sold 609 shares between 21.11.2016 and 25.11.2016 1509741 0.35%Acquired 15844 shares between 28.11.2016 and 02.12.2016 1525585 0.36%Acquired 9271 shares between 05.12.2016 and 09.12.2016 1534856 0.36%Acquired 44406 shares between 12.12.2016 and 16.12.2016 1579262 0.37%Acquired 6950 shares between 19.12.2016 and 19.12.2016 1586212 0.37%Acquired 2928 shares between 20.12.2016 and 23.12.2016 1589140 0.37%Sold 12848 shares between 26.12.2016 and 30.12.2016 1576292 0.37%Acquired 26120 shares between 02.01.2017 and 06.01.2017 1602412 0.37%Acquired 33477 shares between 09.01.2017 and 13.01.2017 1635889 0.38%Sold 11600 shares between 16.01.2017 and 20.01.2017 1624289 0.38%Sold 12177 shares between 23.01.2017 and 27.01.2017 1612112 0.38%Acquired 3140 shares between 30.01.2017 and 03.02.2017 1615252 0.38%Sold 12628 shares between 06.02.2017 and 10.02.2017 1602624 0.37%Acquired 7208 shares between 13.02.2017 and 17.02.2017 1609832 0.38%Acquired 484 shares between 20.02.2017 and 24.02.2017 1610316 0.38%Acquired 16445 shares between 27.02.2017 and 03.03.2017 1626761 0.38%Sold 16296 shares between 06.03.2017 and 10.03.2017 1610465 0.38%Acquired 2824 shares between 13.03.2017 and 17.03.2017 1613289 0.38%Sold 5932 shares between 20.03.2017 and 24.03.2017 1607357 0.38%Acquired 4718 shares between 27.03.2017 and 31.03.2017 - - 1612075 0.38%

9. John Dsouza 871808 0.20% 871808 0.20%Acquired 22000 shares between 04.04.2016 and 08.04.2016 893808 0.21%Acquired 4192 shares between 11.04.2016 and 15.04.2016 898000 0.21%Acquired 11800 shares between 20.12.2016 and 23.12.2016 909800 0.21%Acquired 91578 shares between 26.12.2016 and 31.12.2016 1001378 0.23%

10. Sadhana Gupta 563323 0.13% 563323 0.13%Acquired 14000 shares between 20.06.2016 and 24.06.2016 577323 0.13%sold 516510 shares between 11.07.2016 and 15.07.2016 60813 0.01%Sold 60813 shares between 18.07.2016 and 22.07.2016 0 0.00%Acquired 23356 shares between 10.10.2016 and 14.10.2016 23356 0.01%Acquired 17854 shares between 17.10.2016 and 21.10.2016 41210 0.01%Acquired 1329 shares between 24.10.2016 and 28.10.2016 42539 0.01%Acquired 6017 shares between 07.11.2016 and 11.11.2016 48556 0.01%Acquired 2044 shares between 14.11.2016 and 18.11.2016 50600 0.01%Sold 50600 shares between 21.11.2016 and 25.11.2016 0 0.00%

13


At the End of the year(or on the date of separation, if separated during the year)

1. Zuari Global Limited 9821310 2.29% 9821310 2.29%2. NFCL Employee Welfare Trust 24356052 5.69% 24356052 5.69%3. Life Insurance Corporation of India 5373875 1.26% 5373875 1.26%4. Lok Prakashan Ltd. 2440784 0.57% 2440784 0.57%5. Profitex Shares and Securities Private Limited 1200000 0.28% 1200000 0.28%6. United India Insurance Company Ltd 1193808 0.28% 1193808 0.28%7. Anil Kumar Varshney 27306 0.01% 27306 0.01%8. Karvy Stock Broking Ltd 1612075 0.38% 1612075 0.38%9. John DSouza 1001378 0.23% 1001378 0.23%10. Sadhana Gupta 0 0.00% 0 0.00%

Shareholding at thebeginning of the year

Cumulative Shareholdingduring the year

No. ofshares

% of totalshares of

the Company

No. ofshares

% of totalshares of

the Company

At the beginning of the year - - - -

Date wise Increase / Decrease in Share holding during the yearspecifying the reasons for increase / decrease(e.g. allotment / transfer / bonus / sweat): - - - -

At the End of the year - - - -

ParticularsFor Each of the Directors and KMP

(v) Shareholding of Directors and Key Managerial Personnel:

(vi) INDEBTEDNESSIndebtedness of the Company including interest outstanding/accrued but not due for payment

Secured Loans Unsecured Deposits Totalexcluding Loans Indebted-deposits ness

Particulars

Indebtedness at the beginning of the financial year

i) Principal Amount - 100.00 - -

ii) Interest due but not paid - 10.27 - -

iii) Interest accrued but not due - - - -

Total (i+ii+iii) - 110.27 - -

Change in Indebtedness during the financial year

· Addition - 12.00 - -

· Reduction - 1.18 - -

Net Change 10.82

Indebtedness at the end of the financial year

i) Principal Amount - 100.00 - -

ii) Interest due but not paid - 21.09 - -

iii) Interest accrued but not due - - - -

Total (i+ii+iii) - 121.09 - -

( `̀̀̀̀ In Lakhs)

14


VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNELA. Remuneration to Managing Director, Whole-time Directors and/or Manager: (`̀̀̀̀)

Sl.No. Particulars of Remuneration K Soma Raju, Manager Total Amount1. Gross salary (per annum)

(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961 1,43,667 1,43,667(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 - -(c) Profits in lieu of salary under section 17(3) Income-tax Act, 1961 - -

2. Stock Option - -3. Sweat Equity - -4. Commission

- as % of profit- others, specify - -

5. Others, please specify - -Total (A) 1,43,667 1,43,667Ceiling as per the Act - -

B. Remuneration to Other Directors: ( `̀̀̀̀)

1. Independent Directors Dr. NCB Nath Mr. S R Rama Mr. D Ranga Ms. Lalithakrishnan Raju Raghurram

Fee for attending board / 20,000 25,000 - 15,000 60,000committee meetingsCommission - - - -Others, please specify - - - -Total (1) 20,000 25,000 - 15,000 60,000

2. Other Non-Executive Directors Mr. K S Raju Mr.K Rahul Mr. ChandraRaju Pal Singh Yadav

Fee for attending board / 25,000 25,000 20,000 70,000committee meetingsCommission - - - -Others, please specify - - - -Total (2) 25,000 25,000 20,000 - 70,000Total (B)=(1+2) 45,000 50,000 20,000 15,000 1,30,000Total Managerial RemunerationOverall Ceiling as per the Act

Sl.No. Particulars of Remuneration

TotalAmount

Name of Directors

Sl.No. Particulars of Remuneration Key Managerial Personnel TotalCEO Company CFO

Secretary1. Gross salary

(a) Salary as per provisions contained in section 17(1) - 1084911 4888493 5973404of the Income-tax Act, 1961

(b) Value of perquisites u/s 17(2) of the Income-tax Act, 1961 - - - -(c) Profits in lieu of salary under section 17(3)

of the Income-tax Act, 1961 - - - -2. Stock Option - - - -3. Sweat Equity - - - -4. Commission

- as % of profit-others,specify - - - -

5. Others,please specify - - - -Total - 1084911 4888493 5973404

C. Remuneration To Key Managerial Personnel Other Than MD/ Manager/ WTD (`̀̀̀̀)

15


A. COMPANY - - - - -Penalty - - - - -Punishment - - - - -Compounding - - - - -

B. DIRECTORS - - - - -Penalty - - - - -Punishment - - - - -Compounding - - - - -

C. OTHER OFFICERS IN DEFAULT - - - - -Penalty - - - - -Punishment - - - - -Compounding - - - - -

VII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES:

TypeSection of

the CompaniesAct

BriefDescription

Details of Penalty /Punishment/

Compounding feesimposed

Authority(RD / NCLT/ COURT)

Appeal made,if any

(give Details)

Form No. MR-3Secretarial Audit Report

[Pursuant to Section 204(1) of the Companies Act, 2013 andRule No. 9 of the Companies (Appointment and Remunerationof Managerial Personnel) Rules, 2014]

To,The MembersNagarjuna Oil Refinery LimitedNagarjuna HillsPunjagutta,Hyderabad, Telangana – 500 082

We have conducted the Secretarial Audit of the complianceof applicable statutory provisions and the adherence to goodcorporate practices by Nagarjuna Oil Refinery Limited(hereinafter called the Company). Secretarial Audit wasconducted in a manner that provided us a reasonable basisfor evaluating the corporate conducts/statutory compliancesand expressing our opinion thereon.

Based on our verification of the books, papers, minute books,forms and returns filed and other records maintained by theCompany and also the information provided by its officers,agents and authorized representatives during the conductof secretarial audit; we hereby report that in our opinion,the Company has, during the audit period ended on 31st

March, 2017, complied with the statutory provisions listedhereunder and also that the Company has proper Boardprocesses and compliance mechanism in place to the extent,in the manner and subject to the reporting made hereinafter:

Sl.No. Particulars

1. The Companies Act, 2013 (the Act) and the Rules madethereunder;

2. The Securities Contracts (Regulation) Act, 1956 (‘SCRA’)and the Rules made thereunder;

3. The Depositories Act, 1996 and the Regulations andBye-laws framed thereunder;

4. Foreign Exchange Management Act, 1999 and the Rulesand Regulations made thereunder to the extent ofForeign Direct Investment, Overseas Direct Investmentand External Commercial Borrowings;

5. The Reserve Bank of India Act, 1934 and the Rules madethereunder;

6. The following Regulations and Guidelines prescribedunder 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, 1992;

(c) The Securities and Exchange Board of India (Issueof Capital and Disclosure Requirements)Regulations, 2009;

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

(e) The Securities and Exchange Board of India(Buyback of Securities) Regulations, 1998;

7. We have also examined compliance with the applicableclauses of the following:i. Secretarial Standardsissued by The Institute of Company Secretaries of India.

1. Under the Companies Act, 2013

A. That based on our examination and verification of therecords produced to us and according to the informationand explanations given to us by the Company that theCompany has, in our opinion, complied with theprovisions of the Companies Act. 2013 (“the Act”) andthe Rules made under the Act and Memorandum, andArticles of Association of the Company, inter alia withregard to :

Annexure - V

16


a. Maintenance of various statutory registers anddocuments and making necessary entries therein;

b. Closure of Register of Members / Debenture holders;

c. Forms, returns, documents and resolutionsrequired to be filed with the Register of Companiesand the Central Government;

d. Service of documents by the company on itsmembers and Registrar of Companies.

e. Notices and minutes of the meetings of thecommittees of directors;

f. The meetings of Board of Directors and Committeesof Directors (including passing of resolutions bycirculation) held on 28-05-2016, 06-08-2016, 17-09-2016, 08-11-2016, and 09-02-2017;

g. The Annual General Meeting held on 26th December,2016;

h. Minutes of proceedings of General Meetings andof the Board and its Committee meetings;

i . Approvals of the Members, the Board of Directors,the Committees of Directors wherever required;

j. Constitution of the Board of Directors /Committee(s) of Directors, appointment, retirementand reappointment of Directors

k Appointment and remuneration of Auditors.

l The Directors have not recommended any dividendon the equity capital of the Company. Hence thereis no requirement to comply with the provisionsfor Declaration and payment of dividends;

m Since the Company does not have any unpaid andunclaimed dividend and there is no requirementfor, Transfer of amounts, as required under the Act,to the Investor Education and Protection Fund anduploading of details of unpaid and unclaimeddividends on the websites of the Company and theMinistry of Corporate Affairs is not necessary ;

n Borrowings and registration, modification andsatisfaction of charges wherever applicable;

o Investment of the Company’s funds includinginvestments and loans to others;

p Form of balance sheet as prescribed under Part I,form of statement of profit and loss as prescribedunder Part II and General Instructions forpreparation of the same as prescribed in ScheduleIII to the Act;

q Directors’ report;

r Contracts, common seal, registered office andpublication of name of the Company; and

B. Under the Companies Act, 2013, We further report that

i . The Board of Directors of the Company is dulyconstituted with proper balance of, Non-Executive

Directors and Independent Directors. The changesin the composition of the Board of Directors thattook place during the period under review werecarried out in compliance with the provisions ofthe Act.

i i . Adequate notice is given to all directors to schedulethe Board Meetings, agenda and detailed noteson agenda were sent at least seven days inadvance, and a system exists for seeking andobtaining further information and clarifications onthe agenda items before the meeting and formeaningful participation at the meeting.

i i i . Majority decision is carried through while thedissenting members’ views are captured andrecorded as part of the minutes

iv. There was no prosecution initiated and no fines orpenalties were imposed during the year underreview under the Act, SEBI Act, SCRA, DepositoriesAct, and Rules, Regulations and Guidelines framedunder these Acts against / on the Company, itsDirectors and Officers.

v. The Directors have complied with the disclosurerequirements in respect of their independence andcompliance with the Code of Business Conduct &Ethics for Directors and Management Personnel;

2. Under the Securities Contracts (Regulation) Act, 1956, Wereport that

The Company has complied with the requirements ofSecurities Contracts (Regulation) Act, 1956 and the Rulesmade under that Act.

3. Under the Depositories Act, 1996, we report that

The Company has complied with the provisions of theDepositories Act, 1996 and the Byelaws framedthereunder by the Depositories with regard todematerialization / rematerialisation of securities andreconciliation of records of dematerialized securitieswith all securities issued by the Company.

4. Under FEMA, 1999, we report that

The Company has complied with the provisions of theFEMA, 1999 and the Rules and Regulations made underthat Act to the extent applicable.

5. Under Reserve Bank of India Act, 1934, we report that:

According to the information and explanationsfurnished to us, the Company submitted its applicationfor registration under Section 45-IA of the Reserve Bankof India Act 1934 which is pending clearance by ReserveBank of India

6. Under the SEBI Act, we report that

a. The Company has complied with the requirementsunder the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements)Regulations, 2015.

17


b. The Company has complied with the provisions ofthe Securities and Exchange Board of India(Substantial Acquisition of Shares and Takeover)Regulations, 2011 with regard to disclosures andmaintenance of records required under theRegulations

c. The Company has complied with the provisions ofthe Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations, 2015with regard to disclosures and maintenance ofrecords required under the Regulations.

d. The Company is not required to comply with theprovisions of the Securities and Exchange Board ofIndia (Employee Stock Options Scheme andEmployee Stock Purchase Scheme) Guidelines, 1999with regard to implementation of ’ Employees StockOption Scheme, Grant of Options and relateddisclosures and other aspects as no such transactionhad arisen in this respect during the year underreview.

e. The Company is not required to comply with theprovisions of the Securities and Exchange Board ofIndia (Issue of Capital and Disclosure Requirements)Regulations 2009 as there was no issue and noallotment of convertible warrants on preferentialbasis to entities in the Promoters Group

7. We report further that, the company has complied theSecretarial Standards issued by The Institute ofCompany Secretaries of India with regard to Meeting ofthe Board Meeting (SS-1) and General Meeting (SS-2)

8. We further report that there are adequate systems andprocesses in the company commensurate with the sizeand operations of the Company to monitor and ensurecompliance with applicable laws, rules, regulations andguidel ines.

*Note: This report is to be read with our letter of even datewhich is annexed as “ANNEXURE-A” and Forms an integralpart of this report.

For KBG AssociatesCompany Secretaries

(Srikrishna S Chintalapati)Hyderabad PartnerMay 26, 2017 CP # 6262

‘ANNEXURE-A’To,The Members,Nagarjuna Oil Refinery LimitedNagarjuna Hills, PunjaguttaHyderabad – 500 082Telangana

Our report for the even date to be read with the followingLetter;

Sl.No. Particulars

1. Maintenance of secretarial record is the responsibilityof the management of the company. Our responsibilityis to express an opinion on these secretarial recordsbased on our audit.

2. We have followed the audit practices and processesas were appropriate to obtain reasonable assuranceabout the correctness of the contents of the Secretarialrecords. The verification was done on test basis toensure that correct facts are reflected in secretarialrecords. We believe that the processes and practices,we followed provide a reasonable basis for ouropinion.

3. We have not verified the correctness andappropriateness of financial records and Books ofAccounts of the company.

4. Where ever required, we have obtained theManagement representation about the compliance oflaws, rules and regulations and happening of eventsetc.

5. The compliance of the provisions of Corporate andother applicable laws, rules, regulations, standardsis the responsibility of management. Our examinationwas limited to the verification of procedures on testbasis .

6. The Secretarial Audit report is neither an assurance asto the future viability of the company nor of the efficacyor effectiveness with which the management hasconducted the affairs of the company.

7. Pursuant to analysis made; we have been given tounderstand that the scope of the audit is restricted to

a ) Companies Act, 2013

b) SEBI Act, 1992

c) The Depositories Act, 1996

d) Foreign Exchange Management Act, 1999

e ) Securities Contracts (Regulation) Act, 1956

f) Reserve Bank of India Act, 1934



18


A. COMPANY'S PHILOSOPHYAt Nagarjuna, we believe in the philosophy of SERVING SOCIETY THROUGHINDUSTRY, with the Nagarjuna culture being 'We live every moment of lifein harmony with nature to create value for ourselves, our stakeholders andthe society".This philosophy is backed by principles of concern, commitment, ethics,excellence and learning in all its acts and relationships with stakeholders,customers, associates and community at large which has always propelledthe Group towards higher horizons.We believe in the principles of trusteeship, fair play and transparency in allour dealings. We endeavor to have a work culture, which is performancedriven and conducive to improving discipline, accountability, depth ofcharacter, team spirit and honesty in all our personal and professionalrelationships.GOVERNANCE PHILOSOPHYYour Company firmly believes that building a culture of compliance is morethan meeting regulations and standards. Your Company is always proactivein meeting mandated standards and practicing Corporate Governance inspirit and not just the letter of the Law.Your Company's philosophy on Corporate Governance is based on followingprinciples:i) Preserving core values and ethical business conduct.ii) Commitment to maximizing shareholder value on a sustained basis.iii) To enhance the efficacy of the Board and inculcate a culture of

transparency, accountability and integrity across the Company.iv) Perceiving and mitigating the various risks that impact the Company.v) Make timely and transparent disclosures.vi) Legal and statutory compliances.Your Company's contributory factor is self regulatory system of promptreporting, monitoring, certification and voluntary code of practice andstandards which improves management effectiveness, supervision andaccountability to stakeholders.CORPORATE ETHICSAs a responsible corporate the Company consciously follows corporate ethicsin business and corporate interactions. The various Codes and Policiesadopted by the Company that determine its functioning are:• Code of Conduct for Prevention of Insider Trading• Policy on Corporate Governance• Policy on Related Party Transactions• Legal Compliance Policy• Whistle Blower Policy• Policy on Training for Board of Directors• Policy on Induction of Directors• Board Charter• Policy on Board Evaluation• Policy on Nomination and Remuneration• Policy on Preservation and Archival of Documents• Policy on Disclosure of Material EventsThe effective implementation of these Codes/Policies underpins thecommitment to uphold highest principles of Corporate Governanceconsistent with the Company's goal to enhance stakeholder value.DATE OF REPORTThe information provided in the Corporate Governance Report is as onMarch 31, 2017.

CORPORATE GOVERNANCE REPORT FOR THE YEAR 2016 - 2017(Annexure to the Directors' Report)

The report is updated as on the date of the report wherever applicable.B. BOARD OF DIRECTORSROLE OF BOARD OF DIRECTORSThe Board has its own charter which sets out the role, structure,responsibilities and operation of the Board.The primary role of the Board is that of trusteeship to protect the interestof Company, its stakeholders and enhance their value. As trustee, the Boardensures that the Company has clear goals and policies for achievementwhich are in alignment with the Vision and Mission of the Company.The Board provides strategic direction, reviews corporate performance,authorises and monitors strategic decisions, ensures regulatory compliancesand safeguards interest of stakeholders.The Board is responsible for maintaining and nurturing high levels ofcorporate governance in the Company.PECUNIARY RELATIONSHIPNon executive Directors/ Independent Directors are committed tomaintenance of high level of Corporate Governance and as such they do nothave any material pecuniary relationship with the Company except as statedin the Corporate Governance Report.COMPOSITIONThe Board of Directors of the Company consists of an optimum combinationof Non Executive Directors and Independent Directors from eminent anddiverse fields including one woman director.The composition of the Board is in conformity with SEBI (Listing Obligationsand Disclosure Requirements) Regulations, 2015, which stipulates that notless than fifty percent of the Board of Directors should comprise ofIndependent Non Executive Directors.The Board believes that the current size is appropriate based on the presentcircumstances and periodically evaluates the need for change in compositionand size of the Board.The table below shows the composition of the Board as on March 31, 2017.

CATEGORY NO. OF % OF TOTAL NO.DIRECTORS OF DIRECTORS

Executive Directors 0 0Non Executive Directors 3 50%Independent Directors 3 50%

MANAGERIn compliance with the provisions of Section 196 of the Companies Act,2013 Mr. K Soma Raju was re-appointed as 'Manager' of the Companywith effect from August 31, 2017 for a period of three years subject to theapproval of the members at the ensuing Annual General Meeting.The remuneration of Mr. K Soma Raju as Manager will be in accordancewith the provisions o f Sections 196, 197 and Schedule V of the CompaniesAct, 2013.DIRECTORS ATTENDANCE AND DIRECTORSHIP HELDNone of the Directors of your Company are Directors on the Board ofmore than 20 companies or 7 Listed Companies or 10 Board levelCommittees or Chairman in more than 5 Committees, across allcompanies in which they are Directors.The following table gives the details of the Board and AGM attendance,membership in Committees of Board of the Company and Directorshipsand Committee positions held in other companies, for the year2016 - 2017.

19


INDEPENDENT DIRECTORSDr. N. C. B. Nath 00026509 5/5 Yes Audit - 1 5 1

Nomination & RemunerationStakeholders RelationshipManagement

Mr. S. R. Ramakrishnan 00015839 5/5 Yes Audit 1 2 2 7Nomination & RemunerationManagement

Mr. D. Ranga Raju @ 00066546 0/5 No Nomination & Remuneration 3 2 - 5

Ms. Lalitha Raghuram 07161344 3/5 Yes Audit Committee - 1 - 1

NON EXECUTIVE DIRECTORSMr. K. Rahul Raju 00015990 5/5 No Shares & Debentures - 4 - 6

BankingInvestmentManagementStakeholders Relationship

Mr. K.S. Raju 00008177 5/5 Yes Audit 4 8 10 6ManagementShares & DebenturesBankingInvestmentStakeholders Relationship

Mr. Chandra Pal Singh Yadav 00023382 4/5 Yes NIL 7 8 3 1

Director DIN No.

Attendance Particulars

BoardMeetingsAttended

/ Held

AGMheld on26-12-2016

Committees of Boardof NORL

No. of Board, all the CommitteeMemberships & Chairmanship (other

than NORL) in Public, Pvt., Sec.8 ofCompanies etc.

Board Board CommitteesChairman Director Chairman Director

BOARD MEETINGS AGENDA AND MINUTESAs a system Agenda, Notes on Agenda and information to Directorsare generally circulated to the Board members well in advance notless than 7 days before the meeting of the Board of Directors. Allmaterial information is incorporated in the agenda papers forfacilitating focused discussions at the meeting.The Company is in compliance with Secretarial Standard - I and IIissued by the Institute of Company Secretaries of India.The Board of Directors meet at least once in every quarter to reviewthe quarterly financial results, Audited Annual Accounts andoperations of your Company. Apart from this, Board Meetings areconvened by giving appropriate notice to address specific needsand business requirements of the Company. Matters of urgent natureare approved by the Board by passing resolutions through circulation.The dates of the Board Meeting are decided as far as possible well inadvance and are communicated to the Directors to enable them toschedule their meetings.BOARD MEETINGS HELD DURING THE YEARThe Board of Directors met Five times during the year on May 28,2016, August 06, 2016, September 17, 2016, November 08, 2016, andFebruary 09, 2017.Post-meeting follow-up systemThe Company has a formal system of follow up, review and reportingon actions taken by the management on the decisions of the Board

and Sub Committees of the Board. The Company presents acomprehensive Action Taken Report of the previous meeting to theBoard of Directors at the ensuing Meeting of the Board of Directors.INFORMATION TO THE BOARDThe Board has complete access to all information within theCompany. The following information is regularly provided to theBoard as part of the agenda papers.• Monthly operations report and quarterly results of the Company.• Annual operating plans, budgets, capital budgets, cash flow,

updates and all variances.• Contracts in which Directors are deemed to be interested.• Materially important show cause notices, demand, prosecutions

or other legal notices.• Materially relevant default in financial obligations to and by the

Company.• Significant labour problems and their proposed solutions and

other developments.• Compliance of any regulatory, statutory nature or listing

requirements.• Minutes of the meetings of the Board of Directors and

Committees of the Board of Directors.• Status of subsidiary companies.• Minutes of meetings of the Board of Directors of subsidiary

companies.• Details of related party transactions.

@ Ceased to be a Director with effect from February 01, 2017.

20


• Quarterly compliance report in accordance with theerstwhile Listing Agreement and Regulation 27 of SEBI(Listing Obligations and Disclosure Requirements)Regulations, 2015 and any non compliance.

• Report on risk assessment and minimization procedures.• Information on recruitment and remuneration of senior

managerial personnel below the Board level.• Fatal or serious accidents, dangerous occurrences, any material

effluent or pollution problems.• Issues which involves possible public or product liability claims

of substantial nature, including any judgment or order whichmay have passed strictures on the conduct of the Company ortaken an adverse view regarding another enterprise that canhave negative implications on the company.

• Significant sale of investments, subsidiaries, assets, which arenot in the normal course of business.

• Details of any joint ventures or collaboration agreements.• Transactions that involve substantial payment towards goodwill,

brand equity or intellectual property.• Quarterly details of foreign exchange exposures and the steps

taken by the management to limit the risks of adverse exchangerate movement, if material.

REVIEW OF LEGAL COMPLIANCE REPORTSThe Board periodically reviews during the year the compliancereports in respect of the various statutory enactments applicable tothe company.REMUNERATION TO DIRECTORSThe Company has adopted a Nomination and Remuneration Policyin compliance of Section 178 of the Companies Act, 2013 and theSEBI (Listing Obligations and Disclosure Requirements) Regulations,2015. The policy acts as a guideline for determining, inter-alia,qualifications, positive attributes and independence of a director,matters relating to the remuneration, appointment, removal andevaluation of performance of the Directors, Key ManagerialPersonnel, Senior Management and other employees.The Company has adopted a Policy on Board Evaluation in complianceof Companies Act, 2013 and the SEBI (Listing Obligations andDisclosure Requirements) Regulations, 2015. The purpose of thepolicy is to assess the effectiveness of the Board as a whole,Committees of Board and Individual Directors (Independent and Non-Independent) on regular basis and to take necessary steps forimproving the effectiveness of the Board. The Nomination and

Remuneration Committee of the Board is responsible for theevaluation of the Board, Committee and Directors.REMUNERATION TO NON-EXECUTIVE DIRECTORS/ INDEPENDENTDIRECTORS:The Non-Executive Directors of the company, whetherIndependent or Non-Independent, are paid sitting fees forattending the meetings of the Board of Directors / Committeesof Board of Directors which is within the limits prescribedunder the Companies Act, 2013 and the company has not paidany other fee or compensation to the Non-Executive directors.The table below shows the details of remuneration paid toNon-Executive / Independent Directors of the company duringthe financial year 2016 - 2017.

Name of the Director Sitting Fees paid forattending meetings of the

Board of Directors /Committees of Directors*

INDEPENDENT & NON-EXECUTIVEDr N C B Nath 18,000Mr. S R Ramakrishnan 22,500Mr. D Ranga Raju -Ms. Lalitha Raghuram 13,500NON-EXECUTIVEMr. K S Raju 22,500Mr. K Rahul Raju 22,500Mr. Chandra Pal Singh Yadav 18,000

*Excludes TDS & Service Tax

REMUNERATION TO MANAGERThe details of Compensation of the Manager is :Salary - Rs.10,000/- p.m.Perquisites - as per rules of the company.

APPOINTMENT OF THE DIRECTORSNON-EXECUTIVE DIRECTORSIn accordance with the Articles of Association of the company, onethird of the Directors are liable to retire every year and if eligible,offer themselves for re-appointment at every Annual GeneralMeeting.Mr. K Rahul Raju, Director of the company is liable to retire by rotationand being eligible offers himself for re-appointment as Director,liable to retire by rotation.

Mr. K. Rahul Raju 31-08-1976 September 26, B.Com.,2014 (Hons.)

Name of theDirectors

Date of Birth Lastreappointment

Date

Qualifi-cation

Directorships inother companies

(Only Public Cos.,)

- Nagarjuna Fertilizers and ChemicalsLimited

- The Fertilizer Association of India- Bijam Bio-sciences Private Limited- Bijam Projects & Estates Private

Limited- Petiva Private Limited- Ontray Internet services Private

Limited- Growth Stream Properties Private

Limited

Membership of Committeesof the Board in other

Companies

Nagarjuna Fertilizers andChemicals Limited- Shares and Debentures

Committee- Management Committee- Banking Committee- Investment Committee- CSR Committee- Risk Management

Committee

The table below lists the Directors being appointed.Non - Executive Directors

21


PERFORMANCE EVALUATION OF DIRECTORS AND CRITERIA FOREVALUATION

The Directors Report contains information in this regard.

DETAILS OF FAMILIARIZATION PROGRAMMES TO DIRECTORS

The Company as a practice ensures that all Directors arebriefed on matters of the Company on their induction into theBoard of Directors of the company. The company also issues aLetter of Appointment in case of Independent Directorsdetailing their terms and conditions of appointment.

The Memorandum and Articles of Association of the Company,copies of Annual Reports for the previous financial years,half year reports, organization structure, Company policiesincluding Code of Conduct, Insider Trading Policy, and BoardCharter, Whistle Blower Policy etc. are provided to the directorsat the time of induction.

The Board of Directors are also familiarized at regular intervalson any changes that takes place in the organization and alsoupdations on statutory enactments effecting them as Directorsor impacting the Company.

REMUNERATION POLICY

The Nomination and Remuneration Policy has been adoptedby the Board of Directors based on the recommendation ofthe Nomination and Remuneration Committee in compliancewith Section 178 of the Companies Act, 2013 and the SEBI(Listing Obligations and Disclosure Requirements)Regulations, 2015.

This policy acts as a guideline for determining, inter-alia,qualifications, positive attributes and independence of a Director,matters relating to the remuneration, appointment, removal andevaluation of performance of the Directors, Key ManagerialPersonnel, Senior Management and other employees.

RELATED PARTY TRANSACTIONS

The Directors Report contains information in this regard.

MEETINGS OF INDEPENDENT DIRECTORS

The Independent Directors of the company even before thenotification by SEBI, been having informal meetings before everyBoard Meeting and discussing the issues impacting the company.

The Independent Directors met on May 28, 2016 and August05, 2016 and apart from other matters, connected to theoperations and strategy of the Company evaluated theperformance of the Chairman of the Board and discussedaspects relating to the quality, quantity and timeliness of theflow of information between the Company, the Managementand the Board.

RETIREMENT POLICY OF THE DIRECTORS

The Company does not have a Retirement Policy for themembers of the Board of Directors of the Company.

RESPONSIBILITIES OF THE BOARD

The primary role of the Board is that of trusteeship to protectand enhance shareholders' value. As trustee, the Boardensures that the Company has clear goals and policies forachievement. The Board oversees the Company's strategicdirection, reviews corporate performance, authorizes andmonitors strategic decision, ensures regulatory complianceand safeguards interests of stakeholders.

SHARES HELD BY NON-EXECUTIVE DIRECTORSNone of the Non-Executive Directors were holding any sharesin the Company as on March 31, 2017.CODE OF CONDUCT AND ETHICSThe Company adopted the Code of Conduct and Ethics forDirectors and senior management personnel. The Code hasbeen circulated to all the members of the Board and seniormanagement and the same has been put on the Company'swebsite www.norl.co.in.The Board of Directors and senior managerial personnel haveaffirmed their compliance with the Code and a declaration tothis effect signed by Manager and Company Secretary appearsin the Annexure to the Corporate Governance Report.LEAD INDEPENDENT DIRECTORDr. N C B Nath, who is the Chairman of the Audit Committee ofBoard of Directors, is the Lead Independent Director. The LeadIndependent Director on behalf of the Independent Directorsprovides structural feedback to the Board to encourage healthydiscussions and openness amongst the members of the Board.TRAINING FOR THE BOARD MEMBERSAs part of ongoing knowledge sharing, the Board of Directorsare updated with relevant statutory amendments andlandmark judicial pronouncements encompassing importantlaws such as Company Law, SEBI Law, Income Tax Law, amongothers at meetings of the Board of Directors.The Board of Directors meet periodically with SeniorManagerial Personnel and discuss areas of interest of theCompany.The Company, as a good governance practice, put in place a"Policy on Training of Board of Directors".COMMITTEES TO THE BOARDThe Board of Directors have constituted various Committeeswith adequate delegation to focus on specific areas and takedecisions so as to discharge day to day affairs of the Company.Each committee is guided by its charter, which defines thecomposition, scope and powers of the Committee. Alldecisions and recommendations of the Committees areplaced before the Board of Directors. The Committeesconstituted by the Board as on date are:1. SHARES AND DEBENTURES COMMITTEEThe Committee comprises of following members:

Name of the Member CategoryMr. K S Raju ChairmanMr.K Rahul Raju Member

The Committee met Forty Two (42) times during the year underreview apart from considering matters through circulation.The quorum is two members present in person.Terms of Reference:Allotment of shares, accept calls in advance, and/or sharecapital not called up, approve/reject or otherwise deal withapplications for transfer, transmission, transposition,mutation of shares and debentures, issue share anddebenture certificates including duplicate, split, sub-divideor consolidated certificates and to deal with all relatedmatters.2. STAKEHOLDERS RELATIONSHIP COMMITTEEThe Committee met four (4) times during the year 2016-17.The table shows the list of members of the StakeholdersRelationship Committee and the various dates on whichmeetings were held and their attendance particulars

22


Date of Meeting andattendance particulars

28-5-2016 06-8-2016 08-11-2016 09-2-2017Dr. N C B Nath ChairmanMr. K S Raju MemberMr. K Rahul Raju Member

- Present, X - Absent

Terms of reference:The terms of reference of the Committee shall be matters that areconsidered necessary in relation to shareholders, debenture holders,investors and various other stakeholders of the Company in relationto Transfer of shares, Non-receipt of declared dividends, Non-receiptof balance sheet, complaints directly concerning the shareholders/investors as stakeholders of the Company but not limited to theabove mentioned matters.3. MANAGEMENT COMMITTEEThere were no meetings of the Management Committee of Directorsduring the financial year 2016-2017.The table below shows the list of members of the ManagementCommittee.

Name of the Member CategoryMr. K S Raju ChairmanDr N C B Nath MemberMr. S R Ramakrishnan MemberMr. K Rahul Raju Member

The quorum is two members present in person.Terms of reference:1. To review the operations of the Company from time to time and

also formulate and review corporate objectives and strategiesincluding long range plans for expansion/diversification of theCompany's activities.

2. To formulate annual budgets/business plans for the Company.3. To approve capital expenditure other than proposals for

expansion, diversification, modernization and de-bottlenecking,including investment in immovable property, above Rs. Fivecrores upto Rs. Ten Crores per proposal, excluding the authorityalready delegated to Managing Director or Internal Management,as the case may be, as per Delegation of Authority.

4. To approve revenue expenditure above Rs. Five Crores and uptoRs. Ten Crores in case of procurements on a single tender basisor above Rs. Ten Crores upto Rs. Fifteen Crores on multi tenderbasis excluding the authority already delegated to ManagingDirector or Internal Management, as the case may be, as perDelegation of Authority.

5. To make donations/contributions to charitable and other fundsother than to any political party or for political purposes up to anaggregate amount of Rs. Ten lakhs in any financial year.

6. To lay down and review from time to time Company'semployment policy.

4. AUDIT COMMITTEEThe Audit Committee of Directors consists of well qualified andIndependent Directors. It comprises of four members, and complieswith the stipulation that two thirds of the members shall beIndependent Directors. All the members of the Committee possess

adequate knowledge of finance and accounts. The scope of theactivities of the Committee, are in conformity with Regulation 18 ofSEBI (Listing Obligations and Disclosure Requirements) Regulations,2015 read with section 177 of the Companies Act, 2013 and the rulesmade there under.The table shows the list of members of Audit Committee and thevarious dates on which meetings were held and their attendanceparticulars.


28-5-2016 06-8-2016 08-11-2016* 09-2-2017Dr. N C B Nath Chairman XMr. SR Ramakrishnan Member XMr. K S Raju MemberMs. K Lalitha MemberRaghuram* Meeting not held as the requisite quorum was not present.

- Present, X - Absent

The Company Secretary of the Company functions as Secretary tothe Committee. The Statutory Auditor, the Head-Internal Audit andsuch other executives as the committee considers appropriate arepresent as invitees for the Meetings of the Audit Committee.The quorum for the Audit Committee shall be two membersor 1/3rd of the strength of the Audit Committee, whichever ishigher with at least 2 independent directorsTerms of Referencea ) Oversee the Company’s financial reporting process and

the disclosure of its financial information to ensure thatthe financial statement is correct, sufficient and credible.

b) Recommending to the Board, the appointment, re-appointment, remuneration and terms of appointment ofauditors of the Company.

c) Approval of payment to statutory auditors for any other servicesrendered by the statutory auditors.

d) Reviewing, with the management, the annual financialstatements and auditor’s report thereon before submission tothe Board for approval, with particular reference to:i. Matters required to be included in the Director ’s

Responsibility statement to be included in the Board’sReport in terms of clause (c) of sub- section 3 of Section 134of the Companies Act, 2013.

ii. Changes, if any, in accounting policies and practices andreasons for the same.

iii. Major accounting entries involving estimates based on theexercise of judgment by management.

iv. Significant adjustments made in the financial statementsarising out of audit findings.

v. Compliance with listing and other legal requirementsrelating to financial statements.

vi. Disclosure of any related party transactions.vii. Qualifications in the draft audit report.

e) Reviewing with the management, the quarterly financialstatements before submission to the Board for approval.

f) Reviewing, with the management, the statement of uses/

CategoryName of

the Member

CategoryName of

the Member

23


application of funds raised through an issue (public issue,rights issue, preferential issue, etc.), the statement offunds utilized for purposes other than those stated inthe offer document/prospectus/notice and the reportsubmitted by the monitoring agency monitoring theutilization of proceeds of a public or rights issue andmaking appropriate recommendations to the Board totake up steps in this matter.

g) Review and monitor the auditor ’s independence andperformance and effectiveness of audit process.

h) Approval or any subsequent modification of transactionsof the Company with related parties.

i ) Scrutiny of inter-corporate loans and investments.j) Valuation of undertakings or assets of the Company,

wherever it is necessary.k) Evaluation of internal financial controls and risk

management systems.l ) Reviewing with the management, performance of

statutory and internal auditors, adequacy of the internalcontrol systems.

m) Reviewing the adequacy of internal audit function, if any,including the structure of the internal audit department,staffing and seniority of the official heading thedepartment, reporting structure coverage and frequencyof internal audit.

n) Discussion with internal auditors any significant findingsand follow up thereon.

o) Reviewing the findings of any internal investigations bythe internal auditors into matters where there issuspected fraud or irregularity or a failure of internalcontrol systems of a material nature and reporting thematter to the Board.

p) Discussion with statutory auditors before the auditcommences, about the nature and scope of audit as wellas post-audit discussion to ascertain any area of concern.

q) To look into the reasons for substantial defaults in thepayment to the depositors, debenture holders,shareholders (in case of non payment of declareddividends) and creditors.

r) To review the functioning of the Whistle Blowermechanism.

s ) To approve the appointment of CFO/Whole time FinanceDirector.

t) Carrying out any other function as is mentioned in theterms of reference of the Audit Committee.

u) To consider and commend to the Board appointment ofCost Auditor of the Company.

REPORT OF THE AUDIT COMMITTEE OF DIRECTORS FOR THE YEARENDED MARCH 31, 2017To the Shareholders of Nagarjuna Oil Refinery Limiteda. The Audit Committee’s suggestions from time to time

were implemented by the Company during the course ofthe year.

b. The Audit Committee sought clarifications from theAuditors and the Management of the Company, wheneverrequired, in relation to the financial matters of theCompany as per the scope and powers of the AuditCommittee.

c. The Audit Committee meetings were interactive.d. The Committee is recommending to the Board the

ratification of appointment of M/s. M Bhaskara Rao &Co., Chartered Accountants as statutory auditors of theCompany, to carry out audit of the accounts of the Companyfor the Financial Year 2017-18. M/s. M Bhaskara Rao & Co.,have confirmed their eligibility under Section 141 of theCompanies Act, 2013.

e. M/s. M Bhaskara Rao & Co., have also confirmed that theyhave a valid certificate issued by the Peer Review Boardof the Institute of Chartered Accountants of India as perthe requirements of Regulation 33 (1) (d) of Securitiesand Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations, 2015.

Hyderabad ChairmanMay 26, 2017 Audit Committee

5. BANKING COMMITTEEThere were no meetings of the Banking Committee of Directorsduring the financial year 2016 - 2017.The banking committee consists of

Name of the Member CategoryMr. K S Raju ChairmanMr. K Rahul Raju Member

The quorum is two members present in person.Terms of reference:Availment of fund based and non-fund based credit facilitiesby the Company from Financial Institutions and Banks, as perthe limits delegated by the Board of Directors of the Company.6. INVESTMENT COMMITTEEThere were no meetings of the Investment Committee ofDirectors during the financial year 2016-2017.The Investment Committee consists of :

Name of the Member CategoryMr. K S Raju ChairmanMr. K Rahul Raju Member

The quorum is two members present in person.Terms of reference:1. Investment of surplus funds in units, discounting of LC

backed bills, clean bill discounting, inter-corporatedeposits and investment in shares.

2. To dis-invest or pledge the securities such as shares,debentures, government bonds, etc., held by the Companyin its name from time to time and do all such acts, deedsand things that are necessary in this regard.

7. NOMINATION & REMUNERATION COMMITTEEThe Nomination and Remuneration Committee wasconstituted by the Board of Directors in compliance withRegulation 19 of SEBI (Listing Obligation and DisclosureRequirement) Regulations, 2015 and Section 178(1) of theCompanies Act, 2013.The Committee met two (2) times during the financial year2016-2017The table shows the list of members of the Nomination &Remuneration Committee and the various dates on whichmeetings were held and their attendance particulars

24


Name of the CategoryMember


28-05-2016 05-08-2016Dr. N C B Nath ChairmanMr. SR Ramakrishnan MemberMr. D. Ranga Raju Member X

- Present, X - AbsentThe quorum is two members present in person.Terms of reference:1) Formulate and recommend to the Board a Remuneration Policy,

relating to the remuneration for the directors, key managerialpersonnel and other employees and review/modify the samefrom time to time

2) Formulate criteria for determining qualifications, positiveattributes and independence of a director and review/modifythe same from time to time

3) Identify persons who are qualified to become directors and whomay be appointed in senior management and recommend tothe Board their appointment and removal

4) Carry out evaluation of every director's performance.5) Devising a policy on Board diversity6) To select, retain and terminate the services of any consultant

who shall assist the Committee in discharging its functions.RISK ASSESSMENT AND MINIMISATION PROCEDUREThe Company has setup an Enterprise Risk Management System tomanage and mitigate unforeseen risksC. MANAGEMENTMANAGEMENT DISCUSSION AND ANALYSISThis Annual Report has a detailed chapter on Management Discussionand Analysis.MANAGEMENT DISCLOSURESDirectors and Senior Management Personnel of the Company, aswell as certain identified key associates make half yearly disclosuresto the Board relating to all material, financial and commercialtransactions where they have interest, conflicting with the interestof the Company. The interested Directors do not participate in thediscussion nor do they vote on such matters when the matter isconsidered by the Board of Directors.D. STAKEHOLDERSDISSEMINATION OF INFORMATIONThe Company has established systems and procedures todisseminate relevant information to its stakeholders includingshareholders, auditors, suppliers, customers, employees andfinancers. The primary source of information regarding theoperations of the Company, including the quarterly results, can beviewed on the Company's website www.norl.co.in.The quarterly and annual results of the Company are sent to theStock Exchanges immediately after they are approved by the Boardof Directors and published in English Newspaper and Telugunewspaper.BSE Listing / NEAPS FacilityThe Company files information to the Stock Exchanges through BSEListing website - www.listing.bseindia.com. and NEAPS website -www.connect2nse.com.

Investor Grievance RedressalThe Company has 4,11,441 shareholders as on March 31, 2017. TheCompany during April 1, 2016 to March 31, 2017 received andattended/resolved 1250 letters from the investors anddematerialized / rematerialized 2068 requests for dematerialization/ rematerialisation of shares.The table below shows the details of shareholder's or depositor'squeries/complaints/requests received and resolved during thefinancial year 2016-2017.

Nature of Letters Opening Received Replied ClosingBalance Balance

Change of address 0 59 59 0Share transfers 0 257 257 0Dematerialisation/ 0 2068 2068 0Remat of SharesIssue of duplicate certificates 0 27 27 0Transmission of shares 0 178 178 0General queries 0 1250 1250 0

Share Transfer SystemThe Company's transfer of shares activity is fully computerized.The dematerialized shares are directly transferred to thebeneficiaries account by the depositories.Compliance OfficerMs. Ankita Mathur, Company Secretary is the Compliance Officer forcomplying with the requirements of SEBI (Prohibition of InsiderTrading) Regulations, 2015, and the SEBI (Listing Obligations andDisclosure Requirements) Regulations, 2015.Share Transfer AgentsXL Softech Systems Limited, Hyderabad are the Share Transfer Agentsof the Company.Nomination FacilityShareholders holding physical shares may file nominations inprescribed Form SH-13 of the Companies (Share Capital andDebentures) Rules, 2014, to the Registrar and Transfer Agents of theCompany. Those holding shares in dematerialized form may contacttheir respective Depository Participant (DP) to avail the nominationfacility.Dematerialization of Shares and LiquidityThe shares of the Company are under the category of compulsorydelivery in dematerialized mode by all categories of investors.The Company has signed agreements with both the depositoriesi.e., National Securities Depository Limited and Central DepositoryServices (India) Limited. As on March 31, 2017, over 91.12 % of theshares of the Company are held in electronic mode.The status of the equity shares of the Company as on March 31, 2017is as under:Total No. of Equity Shares: 42,81,81,821Total No. of Shareholders: 4,11,441The table below shows the status on the dematerialization of theequity shares of the Company:

Mode of No. of % to Total No. of % of TotalShareholding Shares Equity Shares Shareholders Shareholders

Physical Form 3,80,09,811 8.88 1,92,090 46.69Held in electronic 39,01,72,010 91.12 2,19,351 53.31modeTotal 42,81,81,821 100.00 4,11,441 100.00

25


The Company's ISIN No. for dematerialization for both NSDL andCDSL is INE453M01018.

RECONCILIATION OF SHARE CAPITAL AUDIT

In terms of Regulation 55A (1) of SEBI (Depositories and Participants)Regulations,1996 a Practicing Company Secretary of the Institute ofCompany Secretaries of India, has carried out the reconciliation ofShare Capital Audit every quarter to reconcile the total admittedcapital with National Securities Depository Limited (NSDL) and Cen-tral Depository Services (India) Limited (CDSL) and the total issuedand listed capital. The audit confirms that the total issued/ paid-upcapital is in agreement with the aggregate total number of shares inphysical form and the total number of dematerialized shares heldwith NSDL and CDSL

DISTRIBUTION OF SHAREHOLDING

The table below shows the distribution of shareholding of variousgroups as on March 31, 2017

Share Holding Shareholders ShareholdingNumber % to Total Value in Rs. % to Total

Upto 5000 407876 99.13 121306776 28.335001 - 10000 1925 0.47 14678125 3.4310001 - 20000 886 0.22 12825597 3.0020001 - 30000 290 0.07 7282301 1.7030001 - 40000 124 0.03 4357451 1.0240001 - 50000 105 0.03 4934740 1.1550001 - 100000 149 0.04 10915603 2.55100001 and above 86 0.02 251881228 58.83TOTAL 411441 100.00 428181821 100.00

The table below shows the distribution of promoter and non-promoter shareholding as on March 31, 2017

Category No. of shares % ofheld shareholding

A. Promoter's holding 17,17,19,642 40.10B. Non-promoters holding

I. Institutional investorsa. Mutual funds and UTI 2,12,650 0.05b. Banks, 74,72,228 1.75

financial institu tions,insurance companies(Central/state govt.institutions/non-govt.institutions)

c. Foreign Institutional 1,27,589 0.03Investors

II. Othersa. Private corporate bodies 4,53,93,895 10.60b. Indian public 17,24,87,441 40.28c. NRIs/OCBs 62,83,249 1.47d. Any other (please specify)

Trusts 2,44,84,827 5.72Foreign National 300 0.00

GRAND TOTAL 42,81,81,821 100.00

The table below shows the details of persons holding more than 1%shareholding in the Company, as on March 31, 2017.Sl No. Name of the Company %

Core- Promoter1. Amlika Mercantile Private Limited 30.42%*

Co- Promoter2. Fireseed Limited 1.87%3. Governor of Andhra Pradesh 4.55%4. KRIBHCO 2.34%

Total 39.18%Institutional Investors

5 Life Insurance Corporation of India 1.26%Others - Private Corporate Bodies

6. NFCL Employees Welfare Trust 5.69%7 Zuari Investments Ltd 4.56%8. Zuari Global Limited 2.29%

* - Please refer Note in Point IV(ii) of Annexure IV of the Directors Report

LIST OF PROMOTER COMPANIESCore-Promoters

1. Amlika Mercantile Private LimitedCo-Promoters

1. Fireseed Limited2. Government of Andhra Pradesh3. Krishak Bharati Co-operative Limited4. Saipem S.p.A. (formerly Snamprogetti S.p.A)

STOCK PRICE DATA

The table below shows the monthly high, low per month on theNational Stock Exchange and Bombay Stock Exchange during thefinancial year 2016-2017

HIGH & LOW PRICE OF SHARES PER MONTH ON BSE & NSEMONTH BSE NSE

HIGH(RS) LOW(RS) HIGH(RS) LOW(RS)April 2016 4.53 3.10 4.60 3.65

May 2016 5.13 3.71 5.15 3.70

June 2016 9.28 4.03 9.15 4.15

July 2016 7.58 5.20 7.60 5.20

August 2016 6.35 4.87 6.30 4.90

September 2016 5.50 4.42 5.55 4.45

October 2016 7.34 4.72 7.40 4.70

November 2016 6.70 4.60 6.65 4.50

December 2016 5.69 4.20 5.60 3.80

January 2017 5.40 4.75 5.50 4.75

February 2017 5.35 4.53 5.40 4.55

March 2017 5.04 4.23 4.95 4.50

GENERAL BODY MEETINGS

The 6th Annual General Meeting of the Company was held onDecember 26, 2016. Mr. K S Raju, Director, chaired the Meeting.

The table below shows the details of the previous threeGeneral Body Meetings and the Special Resolutions passed.

26


DETAILS OF PUBLIC FUNDING IN THE LAST THREE YEARSThe Company has not raised any funds from the public sinceinception.The Company has not issued any GDRs / ADRs.DISCLOSURESCompliance with mandatory requirements of SEBI (ListingObligations and Disclosure Requirements) Regulations, 2015a. Related parties

1. Names of related parties and description ofrelationship.

a ) Associates(i) Nagarjuna Oil Corporation Limited

b) Key Management Personneli ) Mr. K S Raju, Chairmani i ) Mr. K Soma Raju, Manager

c) Enterprises under significant influence of KeyManagement Personnel or their relatives.i ) Nagarjuna Fertilizers and Chemicals Limited

b. Related Party Transactions at the end of the Financial Year 2016-17

Advance Received Rs in LakhsNagarjuna Fertilizers and Chemicals Limited* 1484.80

* In terms of the order of the Hon'ble High Court of Bombay, at Mumbai in the Composite Scheme.

c. Disclosure of accounting treatmentIn the preparation of financial statements, the Company hasfollowed the accounting standards issued by the Institute ofChartered Accountants of India

d. Proceeds from the preferential issue of warrantsNot applicable

e. Certifications:1. The Manager and Chief Financial Officer, certify every

quarter that the unaudited financial results of theCompany do not contain any false or misleadingstatement or figures and do not omit any material factwhich may make the statements or figures containedtherein misleading.

2. A certificate as stipulated by Regulation 17(8) of SEBI(Listing Obligations and Disclosure Requirements)Regulations, 2015 signed by Manager and Chief FinancialOfficer certifying the correctness of the year end financialstatements and cash flow statement, responsibility forinternal controls and indication of changes in theinternal control and accounting policies appears as anannexure to this report.

3. A certificate as mandated by SEBI (Listing Obligationsand Disclosure Requirements) Regulations, 2015 signedby Manager and Company Secretary certifying thecompliance of the company's code of conduct appearsas an annexure to this report.

f. There were no penalties, strictures imposed on the Companyby Stock Exchanges or Securities and Exchange Board ofIndia (SEBI) or any Statutory Authority on any matter relatedto Capital Markets during the last three years.

Compliance with the mandatory requirements of SEBI (ListingObligations and Disclosure Requirements) Regulations, 2015Your Company is fully compliant with the mandatoryrequirements of the SEBI (Listing Obligations and DisclosureRequirements) Regulations, 2015.A certificate from Practicing Company Secretary that theconditions of Corporate Governance as mandated by SEBI(Listing Obligations and Disclosure Requirements)Regulations, 2015 has been obtained and the same is shownas an annexure to the Directors Report.The table shows the Compliance Report status as on March31, 2017(i) Mandatory Requirements

Particulars Regulation ComplianceStatus

(Yes/No)I. Board of Directors 17

A. Composition of Board YesB. Meetings of Board of Directors YesC. Review of Compliance Reports YesD. Code of Conduct YesE. Non-executive Directors' Compensation Yes

& DisclosuresF. CEO & CFO Certification YesG. Risk Management Yes

4th

AGM2013-14

5th

AGM2014-15

6th

AGM2015-16

1st

EGM2011-12

2nd

EGM2011-12

3rd

EGM2011-12

September26, 201412.00 Noon

September29, 201512.00 Noon

December26, 201603.00 PM

June 13,201104.00PM

August 22,201104.00 PM

September05, 201104.00 PM

Sri Satya SaiNigamagamam,8-3-987/2,Srinagar Colony,Hyderabad -500 073

Special Resolution for theappointment of Mr. K SomaRaju as Manager of theCompany for a period of 3years with effect from August31, 2014.

1. To approve borrowinglimits in excess of thelimits prescribed underSection 180(1) (c) of theCompanies Act, 2013 upto a sum not exceeding Rs.1500 Crores.

2. To authorize the board tocharge or mortgage theproperties of the companyunder Section 180(1)(a) ofthe Companies Act, 2013.



Nagarjuna Hills,Punjagutta,Hyderabad-500082

As per section 100-103, of theCompanies Act, 1956,Cancellation of Capital andreduction by 5,00,000 shares.

As per section 31 of theCompanies Act, 1956,Alteration of the Articles ofAssociation of the Company.

Appointment of Manager asper Section 269,198,309,310and Sch XIII of the CompaniesAct, 1956,

Nagarjuna Hills,Punjagutta,Hyderabad-500082Nagarjuna Hills,Punjagutta,Hyderabad-500082

LAST THREE ANNUAL / EXTRA-ORDINARY GENERAL MEETINGSNO. OF DATE & LOCATION SPECIALAGM TIME RESOLUTION(S)& FY PASSEDANNUAL GENERAL MEETINGS

EXTRAORDINARY GENERAL MEETINGS

27


II. Audit Committee 18A. Qualified & Independent Audit Committee YesB. Meeting of Audit Committee YesC. Powers of Audit Committee YesD. Role of Audit Committee YesE. Review of Information by Audit Committee Yes

III. Nomination and Remuneration Committee 19 YesIV. Stakeholders Relationship Committee 20 YesV. Risk Management Committee 21 NAVI. Vigil Mechanism 22 YesVII. Related Party Transactions 23 YesVIII. Subsidiary Companies 24 NAIX. Independent Directors 25 YesX. Obligations with respect to Directors and 26 Yes

Senior ManagementXI. Quarterly Compliance Report on 27 Yes

Corporate GovernanceXII. Website 46 YesXIII. Documents & Information to shareholders 36 YesXIV. Annual Report 34(3) & Yes

Schedule VA. Disclosure of Accounting Treatment YesB. Remuneration of Directors YesC. Management Discussion&Analysis Report YesD. Report of corporate governance YesE. Code of Conduct YesF. Unclaimed Shares Yes

OTHER COMPLIANCESSecretarial Standards of Institute of Company Secretaries of India (ICSI)The Company has been in compliance with the Secretarial Standards onBoard Meetings (SS-1) and General Meetings (SS-2) notified by the Instituteof Company Secretaries of India, New Delhi.

1. The BoardA Non-Executive Chairman may beentitled to maintain a chairman's officeat the Company's expense and alsoallowed reimbursement of expensesincurred in performance of his duties.

2. Shareholders RightsA half-yearly declaration of financialperformance including summary of thesignificant events in last six-months, maybe sent to each household ofshareholders.

3. Modified opinion(s) in audit reportThe listed entity may move towards aregime of financial statements withunmodified audit opinion.

4. Separate posts of Chairman and CEOThe listed entity may appoint separatepersons to the post of chairperson andmanaging director or chief executiveofficer

5. Reporting of Internal AuditorThe Internal auditor may report directlyto the Audit Committee.

COMPLIANCE / NON-ADOPTION OF NON-MANDATORYREQUIREMENTS

Not Applicable

The Un-auditedFinancial Results forthe half year is sentto all shareholderswho have providedtheir e-mail id's

Yes

The Manager of thecompany is CEOapart from non-e x e c u t i v eChairman.The InternalAuditor has directaccess to Auditcommittee.

Disclosure under the Sexual Harassment of Women at Workplace(Prevention, Prohibition and Redressal) Act, 2013.The Company has not received any complaints alleging sexualharassment during the financial year 2016-17.Remote E-votingPursuant to the provisions of Section 108 of the CompaniesAct, 2013 read with Rule 20 of The Companies (Managementand Administration) Rules, 2014 and Regulation 44 of SEBI(Listing Obligations and Disclosure Requirements)Regulations, 2015, the Company is providing remote e-votingfacility of casting votes using an electronic voting system froma place other than venue of the General Meeting and votingat the General Meeting through the ballot form on all theresolutions set forth in the Notice to the 7th Annual GeneralMeeting to be held on Tuesday i.e., December 26, 2017 at 3.00PM.The Company has engaged the services of Central DepositoryServices (India) Limited to provide remote e-voting platformto the shareholders.Please refer to the detailed instructions on remote e-votingat page no. 45 of the Annual Report 2016-17.Shareholders holding shares in demat form and shareholderswho have registered their email id with the Company willalso receive the remote e-voting instructions by email.Shareholders who do not have access to remote e-votingfacility may use the enclosed Ballot Form and send theirassent or dissent on or before closing of business hours ofDecember 25, 2017.GENERAL SHAREHOLDERS INFORMATION

7th AnnualGeneral MeetingDay, Date, Timeand Venue

Dates of BookClosure

RegisteredOffice

ComplianceOfficer

Share TransferAgent

Dividend historyfor the last fiveyears

Tentative datesfor consideringFinancialResults

Listing on StockExchanges &Stock Code

Tuesday, 26th day of December, 2017 at 3.00 PMSri Satya Sai Nigamagamam, Srinagar Colony,Hyderabad - 500 073

December 20, 2017 to December 26, 2017 (bothdays inclusive)

D.No.8-2-248, Nagarjuna Hills, Punjagutta, Hyderabad -500 082.

Ms. Ankita Mathur, Company SecretaryPh No. (040) 23355317. Fax (040) 23350247Email : [email protected]

XL Softech Systems Limited Plot No.3, Sagar Society, Road No. 2, Banjara Hills, Hyderabad - 500 034. Email : [email protected]

The Company has not declared dividend since inception.

Quarter ending June 30, 2017 - 3rd week of July 2017Quarter ending September 30, 2017 -3rd week of October 2017Quarter ending December 31, 2017 - 3rd week of January 2018For the year ending March 31, 2018 - 4th week of April 2018

STOCK CODE BSE : 534184The Bombay Stock Exchange, Mumbai CorporateRelationship Department, 1st Floor, New Trading Ring,Routunda Building, PJ Towers, Dalal Street, Fort Mumbai-400 001STOCK CODE NSE : NAGAROILNational Stock Exchange of India Limited,Exchange Plaza, 5th Floor, Plot No.C/1, G Block,Bandra - Kurla Complex, Bandra (E), Mumbai - 400 051

28


Listing fees for the year 2017-2018 has been paid tothe Stock Exchanges, in the stipulated period, wherethe equity shares of the Company are listed.

INE453M01018 for NSDL and CDSL

L23200AP2010PLC071242

Listing fee

ISIN No.

CIN No.

CERTIFICATION BY CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIALOFFICER OF THE COMPANYWe, K Soma Raju, Manager and A Sudhakara Rao, ChiefFinancial Officer, of Nagarjuna Oil Refinery Limited, to thebest of our knowledge and belief certify that:A. We have reviewed financial statements and the cash flow

statement for the year ended March 31, 2017 and that to thebest of their knowledge and belief:1. These statements do not contain any materially untrue

statement or omit any material fact or contain statementsthat might be misleading;

2. These statements together present a true and fair view ofthe listed entity's affairs and are in compliance with existingaccounting standards, applicable laws and regulations.

B. There are, to the best of our knowledge and belief, notransactions entered into by the listed entity during the yearwhich are fraudulent, illegal or violative of the listed entity'scode of conduct.

C. We accept responsibility for establishing and maintaininginternal controls for financial reporting and that we haveevaluated the effectiveness of internal control systems of thelisted entity pertaining to financial reporting and we havedisclosed to the auditors and the audit committee, deficienciesin the design or operation of such internal controls, if any, ofwhich they are aware and the steps they have taken or proposeto take to rectify these deficiencies.

D. We have indicated to the auditors and the Audit committee1. significant changes in internal control over financial

reporting during the year;2. significant changes in accounting policies during the year

and that the same have been disclosed in the notes to thefinancial statements; and instances of significant fraud ofwhich they have become aware and the involvementtherein, if any, of the management or an employee havinga significant role in the listed entity's internal control systemover financial reporting.

Hyderabad K. Soma Raju A. Sudhakara RaoMay 26, 2017 Manager Chief Financial Officer

DECLARATION REGARDING COMPLIANCE BY BOARD MEMBERS ANDSENIOR MANAGEMENT PERSONNEL WITH THE CODE OF CONDUCTAND ETHICSThis is to inform you that the Company has adopted a Code of Conductand Ethics applicable to all the Members of the Board of Directorsand Senior Management Personnel of the Company. The details ofthe Code of Conduct and Ethics are available at the Company'swebsite at www.norl.co.in.I confirm that the Company has in respect of the financial year endedMarch 31, 2017 received from all the Members of the Board ofDirectors and all the Senior Management Personnel of the Company

a declaration of compliance with the Code of Conduct andEthics as applicable to them.To the best of my knowledge and belief, no transactions enteredinto by the Company during the year are violative of the Company'scode of conduct.Senior Management Personnel are personnel who are part of thecore management team, comprising personnel one level below theexecutive directors and including all functional heads as onMarch 31, 2017.

Hyderabad Ankita Mathur K Soma RajuMay 26, 2017 Company Secretary Manager

CERTIFICATE ON CORPORATE GOVERNANCETo the Members ofNagarjuna Oil Refinery LimitedWe have examined the compliance of conditions of CorporateGovernance by Nagarjuna Oil Refinery Limited for the year endedon 31st March, 2017, as stipulated in Securities andExchange Board of India (Listing Obligations And DisclosureRequirements) Regulations, 2015 of the said Company.The Compliance of conditions of Corporate Governance isthe responsibility of the Management. Our examination hasbeen in the manner described in the Guidance Note onCertification of Corporate Governance issued by the Instituteof Company Secretaries of India and has been limited to areview of the procedures and implementation thereofadopted by the company for ensuring compliance with theconditions of Corporate Governance as stipulated in the saidClause. It is neither an audit nor an expression of opinionon the financial Statements of the Company.In our opinion and to the best of our information andaccording to the explanations given to us, and based on ourreliance upon the representations made by the managementthat there were no transactions of material nature with themanagement or by relatives that may have potential conflictwith the interest of the company at large, as stated underDisclosures Column of the Company’s Report on CorporateGovernance.The Share Transfer Agent of the Company has certified thenumber of complaints received from the investors and thenumber of complaints resolved during the financial year andthere are no complaints pending as at the year-end as statedunder Investor Grievance Redressal Column of the Company’sReport on Corporate Governance.We certify that the company has complied in all materialrespects with the conditions of Corporate Governance asstipulated in the Erstwhile Listing Agreement and Securitiesand Exchange Board of India (Listing Obligations andDisclosures Requirements Regulations, 2015).We further state that such compliance is neither an assuranceas to the future viability of the Company nor the efficiency oreffectiveness with which the management has conductedthe affairs of the company.



29


MANAGEMENT DISCUSSION AND ANALYSISIndian Economic Scenario

India Economy has emerged as the fastest-growing economyin the world during the year 2016-17 with a projected real GDPgrowth of 6.75% to 7.5% in 2017-2018 financial year as per theEconomic Survey 2017.

The demonetization drive of the Government of India hasslowed down the economy during Q3 of 2016 but is expectedin the long run to help in, revival of investment opportunities,providing fillip to infrastructure and the manufacturing sector,reduction of interest rates and lowering income tax rates andpromote a more transparent economy.

The Indian economy during the year is characterized byrelatively lower inflation, fiscal discipline and the efforts ofthe government towards infrastructure investments, public-private partnerships, and the implementation of domesticreforms such as the introduction of the Goods and ServicesTax (GST) Bill".

GST will promote investment, lower transaction and logisticcosts and increase efficiency gains.

Oil and Gas Sector

International Perspective

Global oil and gas industry is on the recovery path which isexpected to strengthen in 2017. The year 2017 may becharacterized as "slow road back." with Organization ofPetroleum Exporting Countries (OPEC) decision to cutproduction, which would help accelerate the drawdown ofglobal oil inventories and support falling crude oil prices.

Oil price is predicted to be in the reasonable zone of $55-60per barrel, which would reduce stress on Exploration andProduction sector.

Indian Perspective

The slump in oil price has proved beneficial to the Indianeconomy and downstream companies strengthening theirfinancial position. The Government of India's strategicdecisions and policy reforms in the petroleum sector arepoised to bring positive results starting 2017.

All segments of petroleum sector namely: upstream, mid-stream and downstream are expected to attract higherinvestments. Improvements in the areas of oil & gasproduction, LNG infrastructure, pipeline network, and CGDnetwork would be seen in 2017.

The Government of India's drive for cashless society wouldhave bigger impact on petroleum sector. The petroleum retailoutlets are going to play a critical role to make cashless societya reality.

Company's strengths and opportunities

Your company has controlling interest in Nagarjuna OilCorporation Limited (NOCL) which is setting up a 6 MMTPA

refinery project at Cuddalore, Tamilnadu 180 km south ofChennai on the Bay of Bengal.

The state-of-the-art project will refine 6 million metric tonnesof crude petroleum per year (MMTPA) in Phase-I, which willprimarily meet the growing energy needs of southern India.

It is the single largest private sector investment in Tamil Naduand declared as anchor unit for the proposed PetroleumChemical & Petrochemical Investment Region (PCPIR) in TamilNadu. The project includes infrastructure facilities that providescope for further expansion of refining capacity by anadditional 9 MMTPA in phase II.

Threats and concerns

The implementation of oil refinery project was impacted bycyclone 'Thane'. The physical completion of the Project as ondate is 58%. The company perceives non-receipt of furtherfunds from various stakeholders as a major concern and athreat to the existence of the Project which in turn will impactthe company's investment.

The identifying of Investor for bringing funds and takingforward the Refinery Project has been a major concern.

However, there is continuing efforts for identifying newinvestors to take the project forward.

Outlook/ Future plans

The future for refinery sector is conducive for investment withfavourable government policy and a stable businessenvironment.

Internal control and Risk management

Your company has adequate internal control systems in placecommensurate with the size of the company. Your companyhas a structured internal audit and risk managementframework which encompasses the entire operations of thecompany.

The company has a web based legal compliance managementsystem to monitor compliance of the various laws applicableto the company.

Financial performance

The Profit/Loss after tax for the year was Rs. 23,988.87 Lakhsagainst Profit/loss after tax of Rs. 331.51 Lakhs for theprevious year.The main contributors to the loss was on exceptional itemrepresenting a provision of Rs.23,622 lakhs towardsdiminution in the value of investment in Nagarjuna OilCorporation Limited (NOCL) in addition to Rs.40,000 Lakhsprovided in the year 2014-15, considering the delay ininduction of partner and consequently, achieving financialclosure for re-assessed cost of project.Human Resources / Industrial Relations:Your company has significant cooperation from its Associatesin the business operations and has harmonious industrialrelations.

30


INDEPENDENT AUDITORS’ REPORTToThe Members ofNagarjuna Oil Refinery Limited

Report on the Standalone Financial Statements

We have audited the accompanying Standalone FinancialStatements of Nagarjuna Oil Refinery Limited (“the Company”),which comprise the Balance Sheet as at March 31, 2017, theStatement of Profit and Loss and the Cash Flow Statement forthe year then ended and a summary of the significantaccounting policies and other explanatory information (herein referred to as “the Standalone Financial Statements”).

Management’s responsibility for the Standalone Financial Statements

The Company’s Board of Directors is responsible for thematters stated in Section 134(5) of the Companies Act, 2013(“the Act”) with respect to the preparation of these StandaloneFinancial Statements that give a true and fair view of thefinancial position, financial performance and cash flows ofthe Company in accordance with the accounting principlesgenerally accepted in India, including the AccountingStandards specified under Section 133 of the Act, read withRule 7 of the Companies (Accounts) Rules, 2014. Thisresponsibility also includes maintenance of adequateaccounting records in accordance with the provisions of theAct for safeguarding the assets of the Company and forpreventing and detecting frauds and other irregularities;selection and application of appropriate accounting policies;making judgements and estimates that are reasonable andprudent; and design, implementation and maintenance ofadequate internal financial controls, that were operatingeffectively for ensuring the accuracy and completeness of theaccounting records, relevant to the preparation andpresentation of the Standalone Financial Statements that givea true and fair view and are free from material misstatement,whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on theseStandalone Financial Statements based on our audit.

We have taken into account the provisions of the Act, theAccounting and Auditing Standards and matters which arerequired to be included in the audit report under theprovisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards onAuditing specified under Section 143(10) of the Act. ThoseStandards require that we comply with ethical requirementsand plan and perform the audit to obtain reasonableassurance about whether the Standalone FinancialStatements are free from material misstatement.

An audit involves performing procedures to obtain auditevidence about the amounts and the disclosures in thestandalone financial statements. The procedures selecteddepend on the auditors’ judgement, including the assessment

of the risks of material misstatement of the StandaloneFinancial Statements, whether due to fraud or error. In makingthose risk assessments, the auditor considers internalfinancial control relevant to the Company’s preparation of theStandalone Financial Statements that give a true and fairview in order to design audit procedures that are appropriatein the circumstances. An audit also includes evaluating theappropriateness of the accounting policies used and thereasonableness of the accounting estimates made by theCompany’s Directors, as well as evaluating the overallpresentation of the Standalone Financial statements.

We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our auditopinion on the Standalone Financial Statements.

Opinion

In our opinion and to the best of our information and accordingto the explanations given to us, the aforesaid StandaloneFinancial Statements give the information required by the Actin the manner so required and give a true and fair view inconformity with the accounting principles generally acceptedin India, of the state of affairs of the Company as at March 31,2017 and its loss and its cash flows for the year ended on thatdate.

Emphasis of Matter

We draw attention to Note 11.1 to the standalone financialstatements regarding provision made towards diminution inthe value of the investment in Nagarjuna Oil CorporationLimited and its adequacy as on March 31, 2017 based on themanagement assessment, for the reasons stated in the saidnote.

Our opinion is not modified in respect of the above matter.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143 (3) of the Act, we report that:

(a) We have sought and obtained all the informationand explanations which to the best of our knowledgeand belief were necessary for the purposes of ouraudit.

(b) In our opinion, proper books of account as requiredby law have been kept by the Company so far as itappears from our examination of those books.

(c) The Balance Sheet, the Statement of Profit and Lossand the Cash Flow Statement dealt with by this Reportare in agreement with the books of account.

(d) In our opinion, the aforesaid Standalone FinancialStatements comply with the Accounting Standardsspecified under Section 133 of the Act, read with Rule7 of the Companies (Accounts) Rules, 2014.

(e) On the basis of the written representations receivedfrom the directors as on March 31, 2017 taken on recordby the Board of Directors, none of the directors isdisqualified as on March 31, 2017 from being

31


appointed as a director in terms of Section 164 (2) ofthe Act.

(f) With respect to the adequacy of the internal financialcontrols over financial reporting of the Company andthe operating effectiveness of such controls, wegive our separate Report in “Annexure A”.

(g) With respect to the other matters to be included inthe Auditor’s Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules, 2014, in ouropinion and to the best of our information andaccording to the explanations given to us:

i . The Company has disclosed the impact of allpending litigations on its financial position inits Standalone Financial Statements – refer Note21.1 to the Standalone Financial Statements.

i i . The Company did not, as at March 31, 2017, haveany material foreseeable losses relating to long-term contracts including derivative contracts.

i i i . There were no amounts, as at 31st March 2017,which are required to be transferred to theInvestor Education and Protection Fund by theCompany.

iv. The Company has provided requisite disclosuresin the Standalone Financial Statements asregards its holding and dealings in SpecifiedBank Notes as defined in the Notification S.O.3407(E) dated the November 8, 2016 of the Ministryof Finance, during the period from November 8,2016 to December 30, 2016. Based on auditprocedures performed and the representationsprovided to us by the management we report thatthe disclosures are in accordance with the booksof account maintained by the Company and asproduced to us – Refer Note 12.1 to the StandaloneFinancial Statements.

2. As required by the Companies (Auditors Report) Order,2016 (“the Order”) issued by the Central Government interms of Section 143(11) of the Act, we give in the “AnnexureB”, a statement on the matters specified in paragraphs 3and 4 of the Order.

for M. Bhaskara Rao & CoChartered Accountants

Firm Registration No. 000459S

D. Bapu RaghavendraHyderabad, PartnerMay 26, 2017 Membership No. 213274

Re: Nagarjuna Oil Refinery LimitedAnnexure A to the Independent Auditors’ reportReport on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)We have audited the internal financial controls over financialreporting of Nagarjuna Oil Refinery Limited (“the Company”)as of March 31, 2017 in conjunction with our audit of theStandalone Financial Statements of the Company for the yearended on that date.Management’s Responsibility for Internal Financial ControlsThe Company’s management is responsible for establishingand maintaining internal financial controls based on theinternal control over financial reporting criteria establishedby the Company considering the essential components ofinternal control stated in the “Guidance Note on Audit ofInternal Financial Controls over Financial Reporting” issuedby the Institute of Chartered Accountants of India (‘ICAI’).These responsibilities include the design, implementationand maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly andefficient conduct of its business, including adherence tocompany’s policies, the safeguarding of its assets, theprevention and detection of frauds and errors, the accuracyand completeness of the accounting records, and the timelypreparation of reliable financial information, as requiredunder the Companies Act, 2013.Auditors’ ResponsibilityOur responsibility is to express an opinion on the Company’sinternal financial controls over financial reporting based onour audit. We conducted our audit in accordance with the“Guidance Note on Audit of Internal Financial Controls overFinancial Reporting” (the “Guidance Note”) and the Standardson Auditing, issued by ICAI and deemed to be prescribedunder section 143(10) of the Companies Act, 2013, to the extentapplicable to an audit of internal financial controls. ThoseStandards and the Guidance Note require that we complywith ethical requirements and plan and perform the audit toobtain reasonable assurance about whether adequateinternal financial controls over financial reporting wasestablished and maintained and if such controls operatedeffectively in all material respects.Our audit involves performing procedures to obtain auditevidence about the adequacy of the internal financialcontrols system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls overfinancial reporting included obtaining an understanding ofinternal financial controls over financial reporting, assessingthe risk whether a material weakness exists, and testingand evaluating the design and operating effectiveness ofinternal control based on the assessed risk. The proceduresselected depend on the auditors’ judgement, including theassessment of the risks of material misstatement of the

32


financial statements, whether due to fraud or error.We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our auditopinion on the Company’s internal financial controls systemover financial reporting.Meaning of Internal Financial Controls over Financial ReportingA Company’s internal financial control over financial reportingis a process designed to provide reasonable assuranceregarding the reliability of financial reporting and thepreparation of financial statements for external purposesin accordance with generally accepted accounting principles.A company’s internal financial control over financial reportingincludes those policies and procedures that -(1) pertain to the maintenance of records that, in reasonable

detail, accurately and fairly reflect the transactions anddispositions of the assets of the Company;

(2) provide reasonable assurance that transactions arerecorded as necessary to permit preparation of financialstatements in accordance with generally acceptedaccounting principles, and that receipts and expendituresof the Company are being made only in accordance withauthorisations of management and directors of theCompany; and

(3) provide reasonable assurance regarding prevention ortimely detection of unauthorised acquisition, use, ordisposition of the company’s assets that could have amaterial effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over FinancialReportingBecause of the inherent limitations of internal financialcontrols over financial reporting, including the possibility ofcollusion or improper management override of controls,material misstatements due to error or fraud may occur andnot be detected. Also, projections of any evaluation of theinternal financial controls over financial reporting to futureperiods are subject to the risk that the internal financialcontrol over financial reporting may become inadequatebecause of changes in conditions, or that the degree ofcompliance with the policies or procedures may deteriorate.OpinionIn our opinion, the Company has, in all material respects, anadequate internal financial controls system over financialreporting and such internal financial controls over financialreporting were operating effectively as at March 31, 2017,based on the internal control over financial reporting criteriaestablished by the Company considering the essentialcomponents of internal control stated in the Guidance Noteon Audit of Internal Financial Controls Over FinancialReporting issued by the Institute of Chartered Accountantsof India.



D. Bapu RaghavendraHyderabad, PartnerMay 26, 2017 Membership No.213274

Re: Nagarjuna Oil Refinery LimitedANNEXURE B TO THE INDEPENDENT AUDITORS’ REPORT(Referred to in paragraph 2 under ‘Report on Other Legal andRegulatory Requirements’ section of our report of even date)(i) In respect of its fixed assets:

(a) The Company has maintained proper recordsshowing full particulars, including quantitativedetails and situation of its fixed assets.

(b) According to the information and explanation givento us, the fixed assets have been physically verifiedby the Management during the year. In our opinion,the frequency of verification is reasonable havingregard to the size of the Company and the natureof the assets. According to the information andexplanations given to us, no discrepancies werenoticed on such verification.

(c) According to the information and explanationsfurnished to us, and based on our review, titledeeds of its immovable properties are in the nameof the Company.

( i i ) As the Company has no inventory, reporting underparagraph 3(ii) of the Order does not arise.

( i i i ) According to the information and explanations given tous, the Company has not granted any loans, secured orunsecured, to companies, firms, Limited LiabilityPartnerships or other parties covered in the Registermaintained under Section 189 of the Companies Act,2013. Accordingly, reporting under clauses (a), (b) and(c) of paragraph 3(iii) of the Order does not arise.

(iv) According to the information and explanationsfurnished to us, the Company has not granted any loans,nor made any investments or given any guarantees orsecurities during the year to any of the parties specifiedin Sections 185 and 186 of the Companies Act, 2013.Hence, reporting under provisions of paragraph 3(iv) ofthe Order does not arise.

(v) In our opinion and according to the information andexplanations given to us, the Company has not acceptedany deposits. Accordingly, reporting under provisionsof paragraph 3(v) of the Order does not arise.

(vi) In our opinion and according to the information andexplanations given to us, the Central Government hasnot prescribed maintenance of cost records underSection 148(1) of the Companies Act, 2013 for theactivities of the Company.

(vii) According to the information and explanations given tous, in respect of statutory dues:(a) The Company has been generally regular in

depositing undisputed statutory dues, includingProvident Fund, Employees’ State Insurance,Income-tax, Sales Tax, Wealth Tax, Service Tax,Customs Duty, Excise Duty, Value Added Tax, Cess

33


and other material statutory dues applicable to itwith the appropriate authorities , and there wereno amounts payable in respect of the aforesaidundisputed statutory dues in arrears, as at March31, 2017, for a period of more than six months fromthe date they became payable.

(b) There were no amounts payable in respect ofProvident Fund, Employees’ State Insurance, SalesTax, Income-tax, Wealth Tax, Service Tax, CustomsDuty, Excise Duty, Value Added Tax, Cess and othermaterial statutory dues as at March 31, 2017 whichhave not been deposited on account of dispute.

(viii) According to the information and explanations given tous, the Company has not availed any loans fromfinancial institutions, banks, government or fromdebenture holders. Accordingly, reporting underprovisions of paragraph 3(viii) of the Order does notarise.

(ix) According to the information and explanationsfurnished to us, the Company has, during the year underreport, not raised any monies through initial publicoffer or further public offer of any of its securities orterm loans. Hence, reporting under provisions ofparagraph 3(ix) of the Order does not arise.

(x) According to the information and explanationsfurnished to us, no fraud by the Company, nor any fraudon the Company by any of its officers or its employeeshas been noticed or reported during the year underreport.

(xi) According to the information and explanationsfurnished to us by the Company, the Company has,during the year under report, paid / provided formanagerial remuneration in accordance with Section197 read with Schedule V of the Companies Act 2013.

(xii) In our opinion, reporting requirement under Paragraph3(xii) of the order does not arise since, according to theinformation and explanations furnished to us, theCompany is not a Nidhi Company

(xiii) According to the information and explanationsfurnished to us, the transactions entered into by theCompany with its related parties are in compliance withthe requirements of the provisions of Sections 177 and188 of the provisions of the Companies Act 2013.

(xiv) According to the information and explanationsfurnished to us, the Company has not made anypreferential allotment or private placement of itsshares or fully or partly convertible debentures duringthe year under report.

(xv) According to the information and explanationsfurnished to us, the Company has not entered into anyagreements for acquisition of assets from or fortransferring its assets to its directors, or the directors

of its subsidiary companies or persons connected withsuch directors, for a consideration other than cash,during the year under report.

(xvi) According to the information and explanationsfurnished to us, the Company submitted its applicationfor registration under Section 45-IA of the Reserve Bankof India Act 1934 which is pending clearance by ReserveBank of India.



D. Bapu RaghavendraHyderabad, PartnerMay 26, 2017 Membership No. 213274

34


As per our report of even date attached For and on behalf of the Board

for M. Bhaskara Rao & Co.,Chartered Accountants

D. Bapu Raghavendra Ankita Mathur A. Sudhakara Rao K. Soma RajuPartner Company Secretary Chief Financial Officer ManagerMembership No. 213274

HyderabadMay 26, 2017

Accompanying Notes form an integral part of the financial statements

Chandra Pal Singh YadavDr. N C B NathLalitha RaghuramK. Rahul RajuDirectors

K.S. RajuChairman

Balance Sheet As At March 31, 2017` in Lakhs

Particulars Note As At Mar 31, 2017 As At March 31, 2016

I. EQUITY AND LIABILITIESShareholders' Funds(a) Share Capital 3 4,281.82 4,281.82(b) Reserves and Surplus 4 8,190.59 12,472.41 32,179.46 36,461.28

Non-Current Liabilities(a) Long-Term Borrowings 5 1,484.80 1,118.80(b) Long-Term Provisions 6 11.63 1,496.43 8.29 1,127.09

Current Liabilities(a) Short Term Borrowings 7 100.00 100.00(b) Trade Payables 8

(A) Micro, Small, Medium Enterprises(MSMEs) - -

(B) Other than MSMEs 3.73 3.21(c) Other Current Liabilities 9 40.04 41.22(d) Short Term Provisions 6 6.00 149.77 10.52 154.95

Total 14,118.61 37,743.32

II. ASSETSNon-Current Assets(a) Fixed Assets

(i) Tangible Assets 10 118.21 120.31(b) Non-Current Investments 11 14,000.00 14,118.21 37,622.00 37,742.31

Current Assets(a) Cash and Cash Equivalents 12 0.02 0.53(b) Short-Term Loans and Advances 13 0.38 0.33(c) Other Current Assets 14 - 0.40 0.15 1.01

Total 14,118.61 37,743.32

Corporate Information and 1 & 2Significant Accounting Policies

35


Statement of Profit and Loss for the year ended March 31, 2017` in Lakhs

Particula Note 2016-17 2015-16

IncomeRevenue from Operations - -Other Income 15 0.36 1.54

Total 0.36 1.54

ExpensesEmployee Benefits Expense 16 157.39 150.94Finance Cost 18 12.09 12.01Depreciation and Amortization 10 2.10 2.12Other Expenses 19 195.65 167.98

Total 367.23 333.05

Loss before exceptional items and tax (366.87) (331.51)Exceptional Items 11.1 23,622.00 -Loss before tax (23,988.87) (331.51)Tax Expense 24

(a) Current Tax - -(b) Deferred Tax - -

Loss after tax (23,988.87) (331.51)

Earnings per equity share of`̀̀̀̀ 1/- each fully paid up - Basic and Diluted 23 (5.60) (0.08)

Corporate Information and Significant Accounting Policies 1 & 2







K.S. RajuChairman

36


Cash Flow Statement for the year ended March 31, 2017` in Lakhs

Particulars 2016-17 2015-16

A. Cash Flow from Operating Activities

Loss before Tax (23,988.87) (331.51)

Adjustments:

Depreciation and Amortisation 2.10 2.12

Provision for Diminution in the Value of Investment 23,622.00 -

Operating Profit before working capital changes (364.77) (329.39)

Movements in Working Capital:

Increase/(decrease) in Trade Payables 0.52 1.28

Increase/(decrease) in Long Term Provisions 3.34 6.25

Increase/(decrease) in Current Liabilities (1.18) 24.24

Decrease/(increase) in Short Term Loans and Advances (0.05) (0.07)

Decrease/(increase) in Other current assets 0.15 0.88

Increase/(decrease) in Short Term Provisions (4.52) 10.48

Net cash flow from/(used in) operating activities (366.51) (286.33)

B. Cash Flow from Investing activities

Purchase of Fixed Assets - -

Net cash flow from investing activities - -

C. Cash flow from financing activities

Proceeds from long term borrowings 366.00 239.57

Net cash flow from/ (used in) financing activities 366.00 239.57

Net Increase/(decrease) in cash and cash equivalents (0.51) (46.76)

Cash and cash equivalents as at beginning of the year 0.53 47.29

Cash and cash equivalents as at end of the year 0.02 0.53







K.S. RajuChairman

37


1. Corporate Information:

Nagarjuna Oil Refinery Limited ("the Company") wasincorporated on November 16, 2010 as a public limited company,primarily engaged in the business of promoting, conceiving,planning, coordinating, executing and monitoring setting up ofany business projects relating to extraction of oil by any meanswithin India and / or elsewhere in the world, either directly orthrough one or more special purpose vehicles and to enter intopartnership, agreements, raise funds in order to carry out anyone or more of the aforementioned activities. In terms of theComposite Scheme of Arrangement and Amalgamation ofNagarjuna Fertilizers and Chemicals Limited, Kakinada Fertilizersand Chemicals Limited, iKisan Limited and Nagarjuna Oil RefineryLimited, the Company took over all the assets pertaining to theoil business undertaking of erstwhile NFCL w.e.f April 1, 2011.

The accounting policies adopted in the preparation of financialstatements are consistent with those of the preceding year.

2. Significant Accounting Policies:

2.1. Basis of accounting and preparation of financial statement

The financial statements of the Company have been prepared inaccordance with the Generally Accepted Accounting Principlesin India (“Indian GAAP”) to comply with the Accounting Standardsspecified under Section 133 of Companies Act, 2013, read withRule 7 of the Companies (Accounts) Rules, 2014 and the relevantprovisions of the Companies Act, 2013 (“the 2013 Act”) /Companies Act, 1956 (“the 1956 Act”), as applicable. The financialstatements have been prepared on accrual basis under historicalcost convention.

The accounting policies adopted in the preparation of financialstatements are consistent with those of the preceding year.

2.2. Use of Estimates:

The preparation of financial statements in conformity with IndianGAAP requires the management to make estimates andassumptions that affect the reported amount of assets andliabilities (including contingent liabilities) and the reportedincome and expenses during the year. The management believesthat the estimates used in preparation of the financial statementsare prudent and reasonable. Future results could differ due tothese estimates and the differences between the actual resultsand the estimates are recognised in the periods in which theresults are known / materialise.

2.3. Fixed Assets:Fixed assets are carried at cost of acquisition or construction lessaccumulated depreciation and impairment losses, if any. Thecost of fixed assets includes non-refundable taxes, duties, freightand other incidental expenses related to the acquisition andinstallation of the respective assets. Borrowing costs directlyattributable to acquisition or construction of fixed assets whichnecessarily take substantial period of time to get ready for theirintended use are capitalised.

2.4. Depreciation:Depreciable amount for assets is the cost of an asset, or otheramount substituted for cost less its estimated residual value.

Notes to Financial Statements for the year ended March 31, 2017Depreciation on tangible fixed assets has been provided on thestraight line method as per the useful life prescribed in ScheduleII to the Companies Act, 2013.Where the cost of a part of an asset is significant to the total costof that asset and its useful life is determined to be differentfrom the useful life of the remaining asset, depreciation on suchpart is computed in accordance with its respective useful life.

2.5. Impairment of Assets:

The Company assesses at each balance sheet date whether thereis any indication that an asset may be impaired. If any suchindication exists, the Company estimates the recoverableamount of the asset. If such recoverable amount of the asset orthe recoverable amount of the cash generating unit to which theasset belongs is less than its carrying amount, the carrying amountis reduced to its recoverable amount. The reduction is treated asan impairment loss and is recognised in the Statement of Profitand Loss. If at the balance sheet date there is an indication thatif a previously assessed impairment loss no longer exists, therecoverable amount is reassessed and the asset is reflected atthe recoverable amount subject to a maximum of depreciatedhistorical cost.

2.6. Investments:

Investments are classified as Non-Current and Current. Long termInvestments are carried at cost less provision for other thantemporary diminution, if any, in value of such investments.Current investments are carried at lower of cost and fair value.

2.7. Foreign currency transactions:Foreign currency transactions are accounted at the exchangerates prevailing on the date of transaction. Gains and lossesresulting from settlement of such transactions are recognised inthe Statement of Profit and Loss.

Liabilities related to foreign currency transactions incurred toacquire fixed assets remaining unsettled at the end of the yearare translated at year end rates. The difference arising on suchtranslation and realized gain or loss is adjusted to the cost ofrespective fixed asset.

Monetary assets and liabilities related to foreign currencytransactions remaining unsettled at the end of the year aretranslated at year end rates. The difference in translation ofmonetary assets and liabilities and realized gain and loss onforeign currency transactions are recognised in the Statementof Profit and Loss.

Premium or discount arising on forward exchange contracts isrecognized in the Statement of Profit and Loss.

2.8. Borrowing Costs

Borrowing costs that are attributable to the acquisition orconstruction of qualifying assets are capitalised as part of thecost of such assets. A qualifying asset is one that necessarilytakes substantial period of time i.e. more than twelve monthsto get ready for its intended use. All other borrowing costs arecharged to the Statement of Profit and Loss.

2.9. Employee Benefits:

Liability for employee benefits, both short and long term, for

38


present and past services which are due as per the terms ofemployment are recorded in accordance with AccountingStandard (AS) 15 “ Employee Benefits”.

2.9.1. Gratuity: In accordance with the Payment of Gratuity Act,1972 the Company provides for gratuity covering eligibleEmployees. Liability on account of gratuity is covered by a policywith Life Insurance Corporation (LIC) of India and the annualcontributions are paid / provided in accordance with the scheme.

2.9.2. Superannuation: The Company makes monthlycontribution to an approved superannuation fund covered by apolicy with LIC of India. The Company has no further obligationbeyond the monthly contribution and is accounted on accrualbasis.

2.9.3. Compensated Absences: Liability for compensated absenceis provided on the basis of valuation by an independent actuaryas at the year end.

2.9.4. Provident Fund: The Company’s contribution towardsprovident fund, administered and managed by an approvedtrust, is charged to the Statement of Profit and Loss on accrualbasis.

2.10. Earnings Per Share : Basic earnings per equity share iscomputed by dividing the net profit for the year attributable tothe Equity Shareholders by the weighted average number ofequity shares outstanding during the year. Diluted earnings pershare is computed by dividing the net profit for the year, adjustedfor the effects of dilutive potential equity shares, attributableto the Equity Shareholders by the weighted average number ofthe equity shares and dilutive potential equity shares outstandingduring the year except where the results are anti-dilutive.

2.11. Taxes:2.11.1. Current Tax: Provision for current tax is made based onthe taxable income computed for the year under the Income TaxAct, 1961.

2.11.2. Deferred Tax: Deferred tax is recognised on timingdifferences, being the differences between the taxable incomeand the accounting income that originate in one period and arecapable of reversal in one or more subsequent periods. Deferredtax is measured using the tax rates and the tax laws, enacted orsubstantially enacted as at the reporting date. Deferred taxliabilities are recognised for all timing differences. Deferred taxassets in respect of unabsorbed depreciation and carried forwardlosses under the Tax Laws are recognised only if there is virtualcertainty supported by convincing evidence that there will besufficient future taxable income available to realise suchassets. Deferred tax assets are recognised for timing differencesof other items only to the extent that reasonable certainty existsthat sufficient future taxable income will be available againstwhich these can be realised. Deferred tax assets are reviewed ateach Balance Sheet date for their realisability.2.12. Contingencies:The Company recognises provisions when there is presentobligation as a result of past event and it is probable that therewill be an outflow of resources and reliable estimate can bemade of the amount of the obligation. A disclosure for Contingentliabilities is made when there is a possible obligation or presentobligations that may, but probably will not, require an outflowof resources. Contingent assets are neither recognised nordisclosed in the financial statements.2.13. Cash Flow Statement : Cash flows are reported using theindirect method, whereby profit / (loss) before extraordinaryitems and tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cashreceipts or payments. The cash flows from operating, investingand financing activities of the Company are segregated basedon the available information.“Cash comprises cash on hand anddemand deposits with banks. Cash equivalents are short-termbalances (with an original maturity of three months or less fromthe date of acquisition), highly liquid investments that arereadily convertible into known amounts of cash and which aresubject to insignificant risk of changes in value.

3. Share CapitalMarch 31, 2017 March 31, 2016

No. of Shares `̀̀̀̀ in Lakhs No. of Shares `̀̀̀̀ in LakhsAuthorisedEquity Shares of ` 1/- each 50,00,00,000 5,000.00 50,00,00,000 5,000.00

Issued, Subscribed and Fully Paid UpEquity Shares of ` 1/- each 42,81,81,821 4,281.82 42,81,81,821 4,281.82

3.1 Reconciliation of the Number of shares outstanding at the beginning and at the end of the reporting year.

March 31, 2017 March 31, 2016No. of Shares `̀̀̀̀ in Lakhs No. of Shares `̀̀̀̀ in Lakhs

Equity Shares of `̀̀̀̀ 1/- eachBalance at the beginning of the year 42,81,81,821 4,281.82 42,81,81,821 4,281.82Add: Issued during the year - - - -Balance at the end of the year 42,81,81,821 4,281.82 42,81,81,821 4,281.82

3.2.Rights, Preferences and Restrictions attached to equity sharesThe Company has only one class of equity shares having a par value of ̀ 1/- per share. Each holder of equity shares is entitled to one voteper share. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of theCompany, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by theshareholders.

Particulars

Particulars

39


3.3. Details of shareholders holding more than 5% of the Shares

March 31, 2017 March 31, 2016No. of shares % of holding No. of shares % of holding

Equity Shares of `̀̀̀̀ 1/- eachNagarjuna Management Services Private Limited 7,14,47,812 16.69 7,14,47,873 16.69(Refer Note 3.3.1.1)Nagarjuna Holdings Private Limited (Refer Note 3.3.1.1) 3,11,03,149 7.26 3,14,78,300 7.35Zuari Global Limited 98,21,310 2.29 2,93,34,310 6.85NFCL Employees Welfare Trust 2,43,56,052 5.69 2,43,56,052 5.69Amlika Mercantile Private Limited (Refer Note 3.3.1) 2,76,88,691 6.47 79,33,452 1.85Baron Properties Private Limited (Refer Note 3.3.1.1) - - 1,66,35,427 3.89White Stream Properties Private Limited(Refer Note 3.3.1.1) - - 27,44,600 0.64

3.3.1. The Company has received disclosure from Amlika Mercantile Private Limited (Amlika) informing of amalgamation of NagarjunaCorporation Limited (NCL) pursuant to a Scheme of Amalgamation approved by the Hon’ble High Court of Bombay at Mumbai onMay 2, 2014 which was made effective on June 19, 2014.

3.3.1.1. Pursuant to the amalgamation, following shares in the Company held by NCL stand vested in Amlika.

In terms of the Composite Scheme of Arrangement and Amalgamation approved by the Hon’ble High Court of Bombay atMumbai on September 14, 2012 wherein Nagarjuna Management Services Private Limited (NMSPL), Nagarjuna HoldingsPrivate Limited (NHPL), Baron Properties Private Limited (BPPL), White Stream Properties Private Limited (WSPPL) gotamalgamated into Nagarjuna Corporation Limited. The equity shares held by NMSPL and NHPL shall be transferred to NCLafter lift of pledge by the banks to whom they are pledged.

3.3.2. As at the year end, shares in the Company totalling to 13,02,39,652 shares i.e. 30.42% stand vested in Amlika.

4. Reserves and Surplus ` in LakhsMarch 31, 2017 March 31, 2016

Capital ReserveOpening Balance 73,483.35 73,483.35

Surplus / (Deficit) in the Statement of Profit and LossOpening Balance (41,303.89) (40,972.38)Add: Net loss after tax for the year (23,988.87) (331.51)Closing Balance (65,292.76) (41,303.89)

Total 8,190.59 32,179.46

` in Lakhs

March 31, 2017 March 31, 2016

Advances from related parties (Refer Note 5.1 and 22) 1,484.80 1,118.80

Total 1,484.80 1,118.80

5.1. The Company is in receipt of the advance from Nagarjuna Fertilizers and Chemicals Limited pursuant to the CompositeScheme of Arrangement and Amalgamation which was approved by jurisdictional High Courts in Mumbai and AndhraPradesh in 2011-12. These advances, in the nature of Loan, are repayable when the company is able to manage itsfinancial affairs and are interest free. The amount is treated as long term borrowings since repayment of the same maynot occur in the next twelve months.

6. Provisions ` in LakhsNon Current Current

March 31, 2017 March 31, 2016 March 31, 2017 March 31, 2016Provision for Employee Benefits

- Gratuity - - 5.71 10.30- Leave Benefit 11.63 8.29 0.29 00.22

Total 11.63 8.29 6.00 10.52

Particulars

Particulars

Particulars

5. Long Term Borrowings (Unsecured)

Particulars

3.4. Aggregate number of shares issued for consideration other than cash : 42,81,81,821 Equity Shares of ` 1/- each (aggregating to ` 4,281.81 Lakhs) were allotted as fully paid up pursuant to the Composite Scheme of Arrangement and Amalgamation during the year 2011-12.

40


7. Short Term Borrowings (Unsecured) ` in LakhsMarch 31, 2017 March 31, 2016

Term Loans from Others 100.00 100.00(Refer Note 7.1)

100.00 100.00

7.1. Represents amount borrowed from a body corporateand is repayable in one bullet repayment at the endof the tenure i.e., October 18, 2015. The loan carries aninterest rate 12% p.a. As at the year end, the Companyhas defaulted in repayment of Principal of ` 100.00Lakhs for 531 days (Previous year ` 100.00 Lakhs for 166days) and payment of interest of ` 2.69 Lakhs, ` 2.72Lakhs, ` 2.71 Lakhs, ` 2.17 Lakhs, ` 2.69 Lakhs, ` 2.72Lakhs and ` 2.72 lakhs for a period of 623 days, 531days, 439 days, 364 days, 273 days, 181 days and 89days respectively. (Previous year ` 2.69 Lakhs, ` 2.72Lakhs and ` 2.71 Lakhs for a period of 258 days, 166days and 74 days respectively).

8. Trade Payables (Refer Note 8.1) ` in Lakhs

Sl. Particulars March 31, March 31,No. 2017 2016

Nil NilA Principal amount remaining unpaidB Interest due thereonC Interest paid by the Company in

terms of Section 16 of Micro, Smalland Medium EnterprisesDevelopment Act, 2006, along withthe amount of the payment madeto the supplier beyond theappointed day during the year.

D Interest due and payable for theperiod of delay in making payment(which have been paid but beyondthe appointed day during the year)but without adding the interestspecified under Micro, Small andMedium Enterprises DevelopmentAct, 2006.

E Interest accrued and remainingunpaid

F Further Interest remaining due andpayable even in the succeedingyears, until such date when theinterest dues as above are actuallypaid to the small enterprise.

Nil NilNil Nil

Nil Nil

Nil Nil

Nil Nil

9. Other Current Liabilities ` in LakhsParticulars March 31, 2017 March 31, 2016Interest accrued and due on 21.09 10.27short term borrowingsStatutory Payables 5.29 5.12Others Payables 13.66 25.83

Total 40.04 41.22

As At Additions As At Upto For the Upto As at As atMarch 31, March 31, March 31, year March 31, March 31, March 31,

2016 2017 2016 2017 2017 2016Tangible AssetsBuildings 139.28 - 139.28 19.85 2.04 21.89 117.39 119.43Furniture, Fixtures and 2.93 - 2.93 2.67 0.06 2.73 0.20 0.26Office EquipmentVehicles 12.37 - 12.37 11.75 - 11.75 0.62 0.62Total 154.58 - 154.58 34.27 2.10 36.37 118.21 120.31Previous Year 154.58 - 154.58 32.15 2.12 34.27 120.31 122.43

10. Fixed Assets ` in LakhsParticulars Gross Block (at cost) Depreciation Net Block

11. Non Current Investments - (Unquoted - at Cost)March 31, 2017 March 31, 2016

No. of Shares `̀̀̀̀ in Lakhs No. of Shares `̀̀̀̀ in LakhsLong Term - TradeIn AssociatesIn Equity Shares of `̀̀̀̀ 10/- each fully paid upNagarjuna Oil Corporation Limited 77,62,20,000 77,622.00 77,62,20,000 77,622.00Less: Provision for diminution in the value of investment 63,622.00 40,000.00(Refer Note 11.1)

14,000.00 37,622.00Aggregate cost of Unquoted Shares - 77,622.00 - 77,622.00

Particulars

Particulars

Particulars March 31, 2017 March 31, 2016

Trade Payables-Other than Acceptances(A) Micro, Small, Medium Enterprises - -

(MSMEs)(B) Other than MSMEs 3.73 3.21

Total 3.73 3.218.1. Disclosures required under Section 22 of the Micro, Small

and Medium Enterprises Development Act, 2006.Trade payable other than acceptances include certaindues to Micro and Small Enterprises, under the Micro,Small and Medium Enterprises Development Act, 2006that have been determined based on the informationavailable with the company and the requireddisclosures are given below:

41


11.1. The Project undertaken by Nagarjuna Oil CorporationLimited (NOCL) is in Construction Stage. Project construction wassubstantially slowed down from the year 2012-13 due to delay intying up of equity for a re-assessed cost and effect of ‘ThaneCyclone’.

NOCL’s management's efforts to induct strategic investor/s havecontinued during the current year, and while the financial closureis yet to be achieved, meaningful discussions are going on withgood prospective investors, which may culminate in the financialclosure being achieved soon.

Considering the delay in the induction of partner andconsequently achieving Financial Closure for re-assessed projectcost, the management, as a prudent measure estimated andmade an additioinal provision of ` 23,622.00 lakhs during theyear towards diminition in the values of Company’s investmentin Nagarjuna Oil Corporation Limited (NOCL) in addition to` 40,000.00 lakhs provided in the year 2014-15.

Based on the progress made by NOCL in tying up of equity andfinancial closure, additional provision, if any, will be made asand when considered necessary.

12. Cash and Cash Equivalents ` in LakhsMarch 31, March 31,

2017 2016Balance with Banks: in Current accounts 0.02 0.53

0.02 0.53

15. Other Income ` in LakhsParticulars 2016-17 2015-16Interest Income from banks and others 0.01 1.54Gain on foreign currency transactions 0.35 -

Total 0.36 1.5416. Employee Benefits Expense

Salaries and Wages 140.72 123.66Contribution to Provident & Other Funds 15.61 26.81Staff Welfare Expenses 1.06 0.47

Total 157.39 150.94

17. The disclosure required under Accounting Standard 15“Employee Benefits”Defined Contribution PlansThe Company makes Provident Fund and SuperannuationFund contribution to defined contribution retirementbenefit plans for qualifying employees including wholetime directors. Under the schemes the Company is requiredto contribute a specified percentage of the payroll coststo fund the benefits. The Provident Fund schemeadditionally requires the Company to guarantee paymentof interest at rates notified by the Central Governmentfrom time to time, for which shortfall if any, shall beprovided for.Contribution to these Defined Contribution Plans, chargedoff during the year are as under:

Particulars 2016-17 2015-16Employer’s contribution to 5.59 4.74Provident FundEmployer’s contribution to 3.05 2.75Superannuation FundEmployer’s contribution to 0.68 0.64Pension Scheme

Defined Benefit PlansThe employees’ gratuity fund scheme managed by Life InsuranceCorporation of India (LIC) is a defined benefit plan. The presentvalue of obligation is determined based on actuarial valuationusing the Projected Unit Credit Method, which recognizes eachperiod of service as giving rise to additional unit of employeebenefit entitlement and measures each unit separately to buildup the final obligation. The obligations and contribution to theScheme are routed through Nagarjuna Employees Gratuity Trustwhich is monitoring the gratuity scheme through LIC. TheCompany has contributed ` 7.22 Lakhs to the scheme duringthe year (Previous Year ` 1.35 Lakhs)a. Reconciliation of opening and closing balance of Defined

Benefit ObligationGratuity ` in Lakhs

Particulars March 31, March 31,2017 2016

Defined Benefit obligation at 14.11 2.03beginning of the yearCurrent Service Cost 1.10 0.14Interest Cost 1.05 0.16Actuarial (gain)/loss 0.48 11.78Past service cost - -Benefits paid - -Defined Benefit Obligation at the 16.74 14.11end of the year

` in LakhsParticulars

12.1. Specified Bank Notes Disclosure (SBN’S)During the year, the Company had specified bank notes orother denomination note as defined in the MCAnotification G.S.R. 308(E) dated March 31, 2017. Details ofSpecified Bank Notes (SBN) and Other Denomination Notes(ODN) held and transacted during the period from November 8,2016 to December, 30 2016, are given below:

` in LakhsParticulars SBNs ODNs TotalClosing cash as onNovember 8, 2016 0.10 - 0.10(+) Permitted receipts - 0.24 0.24(-) Permitted payments - 0.24 0.24(-) Amount deposited 0.10 - 0.10in BanksClosing cash on hand as - - -on December 30, 2016

13. Short Term Loans and Advances (Unsecured) ` in LakhsParticulars March 31, March 31,

2017 2016

Advances recoverable in cash or kind 0.02 -Postal Deposit 0.29 0.33Prepaid Expenditure 0.07 -

Total 0.38 0.3314. Other Current Assets

TDS receivable - 0.15Total - 0.15

42


b. Reconciliation of opening and closing balances of fair valueof plan assets ` in Lakhs

Fair value of plan assets at 3.81 2.46beginning of the yearExpected return on plan assets - -Actuarial gain/(loss) - -Employer contribution 7.22 1.35Benefits paid - -Fair value of plan assets at year end 11.03 3.81


c. Reconciliation of fair value of assets and obligations ` in Lakhs

Fair value of plan assets 11.03 3.81Present value of obligation 16.74 14.11


d. Expenses recognized during the year under the head“Employee benefits expense" ` in Lakhs

Particulars 2016-17 2015-16Current service Cost 1.10 0.14Interest Cost 1.05 0.16Expected return on plan assets - -Actuarial (gain)/loss 0.48 11.78Past Service Cost - -Net cost 2.63 12.08

e. Investment Details


L.I.C. Group Gratuity 100% 100%(Cash Accumulation) PolicyAmount (` In Lakhs) 11.03 3.81

f. Actuarial assumptionsMortality Table of L.I.C.

Particulars 2016-17 2015-16

Discount rate (per annum) 6.69% 7.46%Expected rate or return on plan assets - 8.48%(per annum)Rate of escalation in salary 6.00% 6.00%(per annum)

The estimate of rate of escalations in salary considered inactuarial valuation, takes in to account inflation, length of serviceand other relevant factors.

18. Finance Cost

` in Lakhs

2016-17 2015-16

Interest on Term Loans - others 12.00 12.00Interest on delayed payment of TDS 0.09 0.01

Total 12.09 12.01

Particulars

19. Other Expenses

Rates and Taxes 0.46 0.46Legal, Secretarial & other Consultancy 45.13 42.92Professional and Consultancy 71.34 63.51Advertisement and Publicity 1.01 1.81Electricity 0.16 0.12Postage and Telephone 32.33 35.35Office Maintenance 0.69 0.41Insurance 15.09 0.09Travelling and Conveyance 2.36 4.03Printing and Stationery 19.81 14.53Directors Sitting Fees 1.49 1.88Auditors' Remuneration 0.98 0.97(Refer Note 20)Bank Charges 0.16 0.09Meeting expenses 3.84 1.44Miscellaneous 0.80 0.37

Total 195.65 167.98

2016-17 2015-16Particulars

` in Lakhs

20. Auditor's Remuneration

Fees TowardsStatutory Audit 0.57 0.57Limited Review 0.35 0.34Other Certifications 0.06 0.06

Total 0.98 0.97Above fee is inclusive of Service Tax ` 0.13 Lakhs (Previous Year ` 0.12 Lakhs)


` in Lakhs

21. Contingent Liabilities and Commitments (Not provided for):

21.1. Contingent liabilities not provided for: Nil

21.2. Commitments:

21.2.1. Other Commitments:

i . Commitment on account of ‘Sponsor undertaking’pursuant to the agreement with the lenders and othershareholders of Nagarjuna Oil Corporation Limited, anAssociate Company, for funding of project cost overrun,if any, which as at the date of this Balance Sheet arenot determinable.

i i . Commitment towards all contracts, deeds, bonds,insurance, Letters of Intent, undertakings,arrangements, policies, agreements (includingerstwhile shareholders agreements and investoragreements) and other instruments, if any, relating tooil business undertaking executed by NagarjunaFertilizers and Chemicals Limited which standstransferred and vested pursuant to Composite Schemeof Arrangement and Amalgamation, which as at thedate of this Balance Sheet are not determinable.

19.1. Expenditure in Foreign Currecy

Professional & Consultancy Fee 55.25 -Total 55.25 -


` in Lakhs

43


RemunerationMr. K.Soma Raju - 1.22 - -

- (1.22) - -Sitting FeesMr. K.S Raju - 0.25 - -

- (0.30) - -Mr. K.Rahul Raju - - 0.25 -

- - (0.30) -Advances Received fromNagarjuna Fertilizers and Chemicals Limited - - - 366.00

- - - (239.57)Reimbursement of share of Professional &Consultancy charges / InsuranceNagarjuna Oil Corporation Limited 15.00 - - -

(60.32) - - -Note: Figures in brackets represent previous year transactions.

Enterprisessignificantly

influenced byKey Management

personnel

Relatives ofKey Management

Personnel

KeyManagement

Personnel

Related party transactions are as under: `̀̀̀̀ in Lakhs

Nature of transaction Associates

Advances ReceivedNagarjuna Fertilizers and Chemicals Limited - - 1,484.80

- - (1,118.80)Other current liabilitiesMr. K Soma Raju - 0.10 -

- (0.10) -Nagarjuna Oil Corporation Limited 0.32 - -

(10.32) - -Note: Figures in brackets represent previous year transactions.

Enterprises significantlyinfluenced by

Key Management personnel

KeyManagement

Personnel

Balances outstanding at the year end March 31, 2017 `̀̀̀̀ in Lakhs

Nature of transaction Associates

23. Earnings Per Share:S.No. Particulars Unit of 2016-17 2015-16

Measurement

1 Net Loss after tax for the Year `̀̀̀̀ In Lakhs (23,988.87) (331.51)2 Number of Equity Shares (Fully Paid up) Numbers 42,81,81,821 42,81,81,8213 Earnings per Share - Basic and Diluted (Face Value of `̀̀̀̀ 1/- per Share) [1]/[2] (5.60) (0.08)

Note: The Company has no dilutive instruments as at March 31, 2017, hence Dilutive earnings per share equals to Basic Earnings pershare.

22. Related party transactions (Disclosures as required by "AS-18 Related Party Disclosures")Names of related parties and description of relationship.Associatesi . Nagarjuna Oil Corporation LimitedKey Management Personneli . Mr. K.S. Raju, Chairmani i . Mr. K. Soma Raju, ManagerRelatives of Key Management Personneli . Mr. K. Rahul Raju, Director, Son of Mr. K S RajuEnterprises under Significant influence of Key Management personnel or their relativesi . Nagarjuna Fertilizers and Chemicals Limited

44


24 Tax Expense:

i) Provision for current tax does not arise since the company has no taxable profits.

ii) Deferred Tax asset (Net): Deferred tax asset is not recognised on account of unabsorbed depreciation and unabsorbed BusinessLoss as a measure of prudence.

25. Balances in the accounts of various parties appearing in these statements are subject to confirmations and reconciliations.

26. The figures for the previous year have been restated / regrouped, wherever necessary, to conform to current year classification.

Signatories to Notes “1 to 26”

For and on behalf of the Board

Ankita Mathur A. Sudhakara Rao K. Soma RajuCompany Secretary Chief Financial Officer Manager


K.S. RajuChairman


45


The instructions for shareholders voting electronically are as under:( i) The voting period begins on Decembeer 23, 2017 at

9.00 a.m., and ends on December 25, 2017 at 5.00 p.m.During this period shareholders’ of the Company, holdingshares either in physical form or in dematerialized form,as on December 19, 2017 may cast their vote electronically.The e-voting module shall be disabled by CDSL for votingthereafter.

( i i ) The shareholders should log on to the e-voting websitewww.evotingindia.com.

(iii) Click on Shareholders.(iv) Now Enter your User ID

a. For CDSL: 16 digits beneficiary ID,b. For NSDL: 8 Character DP ID followed by 8 Digits Client ID,c. Members holding shares in Physical Form should enter Folio

Number registered with the Company.(v) Next enter the Image Verification as displayed and Click on

Login.(vi) If you are holding shares in demat form and had logged on to

www.evotingindia.com and voted on an earlier voting of anycompany, then your existing password is to be used.

(vii) If you are a first time user follow the steps given below:For Members holding shares in Demat Form and Physical Form

PAN Enter your 10 digit alpha-numeric PAN issued by IncomeTax Department (Applicable for both dematshareholders as well as physical shareholders)Members who have not updated their PAN with theCompany/Depository Participant are requested to usethe first two letters of their name and the 8 digits of thesequence number (available on the address label pastedon the annual report and/or in the email sent tomembers) in the PAN field.In case the sequence number is less than 8 digits enterthe applicable number of 0’s before the number afterthe first two characters of the name in CAPITAL letters.Eg. If your name is Ramesh Kumar with sequencenumber 1 then enter RA00000001 in the PAN field.

Dividend Enter the Dividend Bank Details or Date of Birth (in dd/mm/yyyy format) as recorded in your demat account orin the company records in order to login.If both the details are not recorded with the depositoryor company please enter the member id / folio numberin the Dividend Bank details field as mentioned ininstruction (iv).

(viii) After entering these details appropriately, click on “SUBMIT”tab.

(ix) Members holding shares in physical form will then directlyreach the Company selection screen. However, membersholding shares in demat form will now reach ‘PasswordCreation’ menu wherein they are required to mandatorilyenter their login password in the new password field. Kindlynote that this password is to be also used by the demat holdersfor voting for resolutions of any other company on which theyare eligible to vote, provided that company opts for e-votingthrough CDSL platform. It is strongly recommended not toshare your password with any other person and take utmostcare to keep your password confidential.

SHAREHOLDER INSTRUCTIONS OFR E-VOTING

BankDetailsORDateof Birth(DOB)

(x) For Members holding shares in physical form, thedetails can be used only for e-voting on the resolutionscontained in this Notice.

(xi) Click on the EVSN for “Nagarjuna Oil Refinery Limited” tovote.

(xii) On the voting page, you will see “RESOLUTION DESCRIPTION”and against the same the option “YES/NO” for voting. Selectthe option YES or NO as desired. The option YES implies thatyou assent to the Resolution and option NO implies that youdissent to the Resolution.

(xiii) Click on the “RESOLUTIONS FILE LINK” if you wish to view theentire Resolution details.

(xiv) After selecting the resolution you have decided to vote on,click on “SUBMIT”. A confirmation box will be displayed. Ifyou wish to confirm your vote, click on “OK”, else to changeyour vote, click on “CANCEL” and accordingly modify your vote.

(xv) Once you “CONFIRM” your vote on the resolution, you willnot be allowed to modify your vote.

(xvi) You can also take a print of the votes cast by clicking on “Clickhere to print” option on the Voting page.

(xvii) If a demat account holder has forgotten the changed passwordthen Enter the User ID and the image verification code andclick on Forgot Password & enter the details as prompted bythe system.

(xviii) Shareholders can also cast their vote using CDSL’s mobileapp m-Voting available for android based mobiles. The m-Voting app can be downloaded from Google Play Store. Appleand Windows phone users can download the app from theApp Store and the Windows Phone Store respectively. Pleasefollow the instructions as prompted by the mobile app whilevoting on your mobile.

(xix) Note for Non – Individual Shareholders and Custodians• Non-Individual shareholders (i.e. other than Individuals,

HUF, NRI etc.) and Custodian are required to log on towww.evotingindia.com and register themselves asCorporates.

• A scanned copy of the Registration Form bearing the stampand sign of the entity should be emailed [email protected].

• After receiving the login details a Compliance User shouldbe created using the admin login and password. TheCompliance User would be able to link the account(s) forwhich they wish to vote on.

• The list of accounts linked in the login should be mailedto [email protected] and on approval ofthe accounts they would be able to cast their vote.

• A scanned copy of the Board Resolution and Power ofAttorney (POA) which they have issued in favour of theCustodian, if any, should be uploaded in PDF format inthe system for the scrutinizer to verify the same.

(xx) In case of members receiving the physical copy :Please follow all steps from sl.no. (i) to sl.no. (xx) above tocast vote.In case you have any queries or issues regarding e-voting,you may refer the Frequently Asked Questions (“FAQs”) ande-voting manual available at www.evotingindia.com, underhelp section or write an email [email protected].

46


47


NAGARJUNA OIL REFINERY LIMITEDRegistered Office: D.No.8-2-248, Nagarjuna Hills, Punjagutta, Hyderabad - 500082

BALLOT FORM

(The members who are not able to attend the Annual General Meeting can send their assent or dissent in writing in respect of the resolutionsas set out in the notice by sending the duly filled and signed Ballot/ Poll Form to Mr. CSS Krishna, Practicing Company Secretary, (theScrutinizer) Flat No.101, Sri Sai Krishna Residency, 1-2-234/13, Aravind Nagar, Domalguda, Hyderabad - 500 029so as to reach him on or beforeclose of business hours (i.e. 5.00 PM) of December 25, 2017)

Sl.No. Particulars Details

1. Name of the First Named Shareholder(In Block Letters)

2. Postal Address

3. Registered Folio No./*DP ID No./ Client ID *(*Applicable to investors holding shares indematerialized form)

4. No of shares held

I/ We hereby exercise my/ our vote in respect of Ordinary/Special Resolution enumerated below by recording my/ our assent or dissent tothe said resolution by placing tick ( ) mark at the appropriate box below :

Item No. Resolution I/ We assent to I/ We dissent from the resolution the resolution

1 Adoption of Financial Statements for the year ended March 31, 2017and the Directors Report and Auditors Report thereon

2 Appointment of Mr. K Rahul Raju (DIN No. 00015990), whoretires by rotation

3 Ratification of the appointment of M/s. M Bhaskara Rao & Co asStatutory Auditors of the company for the Financial Year 2017-18

4 Re-appointment of Mr. K Soma Raju as Manager for a period ofthree years with effect from August 31, 2017 and payment ofhis remuneration.

Place :Date (Signature of the shareholder)

INSTRUCTIONS FOR FILING THE BALLOT FORM

1. A Member desiring to exercise vote by ballot form may complete the ballot form and send it to the Scrutinizer Mr C S S KrishnaPartner, M/s K B G Associates, Company Secretaries at Flat No.101, Sri Sai Krishna Residency, 1-2-234/13, Aravind Nagar, Domalguda,Hyderabad - 500 029 appointed by the Company

2. In case of shares held by companies, trusts, societies etc,. the duly completed ballot form should be signed by a person authorizedand accompanied by a certified true copy of the resolution indicating the authorization.

3. Unsigned Ballot Forms will be rejected.

4. Duly completed Ballot Form should reach the Scrutinizer not later than 5.00 PM on December 25, 2017, Monday, at addressmentioned in Point No.1 above.

5. The Scrutinizer's decision on the validity of a Ballot Form will be final.

48


49


✁

NAGARJUNA OIL REFINERY LIMITEDRegistered Office : Nagarjuna Hills, Hyderabad - 500 082

7th Annual General Meeting at 3.00 PM on December 26, 2017at Sri Satya Sai Nigamagamam, 8-3-987/2, Srinagar Colony, Hyderabad - 500 073

ADMISSION SLIPFolio No. /DP ID & Client ID_______________________________________________ Shares Held ______________________________

Please tick whether Member / Joint holder / Proxy Member's or Proxy's Signature _________________________________________

Note: Shareholder / Proxy must bring the Admission Slip to the Meeting and hand it over at the entrance duly signed.

PROXY FORM[Pursuant to section 105 (6) of the Companies Act, 2013 and Rule 19(3) of the Companies (Management and Administration) Rules, 2014]

CIN : L23200AP2010PLC071242

Name of the Company : Nagarjuna Oil Refinery LimitedRegistered Office : D.No.8 -2-248, Nagarjuna Hills, Punjagutta, Hyderabad - 500082

Name of the member(s):

Registered Address :

Email Id:

Folio No./Client ID

DP ID :

I/We, being the member(s) of _____________________________ shares of the above named Company, hereby appoint

1. Name : ______________Address : ______________Email Id : ______________Signature : _____________ or failing him



As my/our proxy to attend and vote (on a poll) for me/us and on my/our behalf at the 7th Annual General Meeting of the Company, to be heldon Tuesday, 26th day of December, 2017 at 3.00 PM at Sri Satya Sai Nigamagamam, 8-3-987/2, Srinagar Colony, Hyderabad - 500 073and at any adjournment thereof in respect of such resolution as are indicated below :

Ordinary Business1. Adoption of Financial Statements for the year ended March 31, 2017 and the Directors Report and Auditors Report thereon2. Appointment of Mr. K Rahul Raju (DIN No. 00015990), who retires by rotation.3. Ratification of the appointment of M/s. M Bhaskara Rao & Co as Statutory Auditors of the Company for the Financial Year 2017-18.4. Re-appointment of Mr. K Soma Raju as Manager for a period of three years with effect from August 31, 2017 and payment

of his remuneration.

Signed this _____day of _________ 2017

Signature of shareholder

Signature of Proxy holder(s)

Note : This form of proxy in order to be effective should be duly completed and deposited at the Registered Office of the Company,not less than 48 Hours before the commencement of the Meeting.

AffixRevenue