Sahana Systems Ltd Directors Report

TO

THE MEMBERS OF THE COMPANY

Your Directors feel great pleasure in presenting 03^rd Annual Report on the business and operations of the Company together with the Audited Financial Statements for the year ended 31^st March, 2023.

1. FINANCIAL HIGHLIGHTS

(Rs. in Lakhs except EPS)

S. NO. PARTICULARS	CURRENT YEAR ENDED 31ST MARCH, 2023	PREVIOUS YEAR ENDED 31ST MARCH, 2022
1. Total Revenue	2414.23	1217.39
2. Other Income	-	-
3. Total Income Profit before Depreciation &	2414.23	1217.39
4. Amortization Expenses, Finance Cost and Tax	967.46	277.7
5. Less : Depreciation and Amortization Expenses	17.02	9.93
6. Finance Cost	64.25	72.24
7. Profit before Tax	886.19	195.53
8. Less: Provision for Tax	249.07	55
9. Deferred Tax	(2.52)	(0.65)
10. MAT Credit Entitlement	-	-
11. Profit after Tax	639.64	141.18
12. Interim Dividend	-	-
13. Profit for the year	639.64	141.18
14. Earnings per share (EPS)
Basic	11.48	2.54
Diluted	11.48	2.54

2. REVIEW OF OPERATIONS

During the year under review, the Companys Revenue from Operations stood at Rs. 2414.23 lakhs compared to Rs. 1217.39 lakhs in the previous year. The Net Profit for the year stood at Rs. 639.64 Lakhs as against Rs. 141.18 Lakhs reported in the Previous Year.

3. CHANGE IN MANAGEMENT

In view of the appointments and resignation of Directors in the Board of the Company, following is the revised Composition of the Board;

SR NO. NAME OF THE DIRECTORS	DESIGNATION	DIN/PAN	STATUS
1. HETANG ARUNKUMAR SHAH	Managing Director	02710970	Promoter/ Chairman
2. HETAL CHATURBHAI PATEL	Non-Executive	08381794	Non- Independent
3. EKTA ANKIT PATEL	Non-Executive	09574878	Independent Director
4. NISHITA MAYANK SANGHVI	Non-Executive	09574964	Independent Director

4. ALTERATION OF MEMORANDUM OF ASSOCIATION AND ARTICLES OF ASSOCIATION

The Company has converted into Public Limited Company, Consequent to Conversion from Private Limited Company to Public Limited Company, Name of the Company was changed from "Sahana System Private Limited" to "Sahana System Limited" w.e.f. 05^th April, 2022.

Alteration of Object Clause

At the Extra-ordinary General Meeting held on 14^th May, 2022, The Company has altered its Object clause by inserting new clauses 4, 5, 6.

5. DIVIDEND AND RESERVES

In order to conserve resources and to meet financial requirements to implement its future plans, your Directors do not propose any dividend for the year under review.

During the year under review Nil was transferred to General Reserves.

6. SHARE CAPITAL OF THE COMPANY

During the year Company has increased its Authorized Share Capital in the manner set forth below:

Particulars of Change		Date of Shareholders Meeting	AGM / EGM
From	To
5,00,00,000 consisting of 50,00,000 equity shares of 10.00 each	10,00,00,000 consisting of 1,00,00,000 equity shares of 10.00 each	02/09/2022	EGM

During the Year Company has increased its Paid up Capital in the manner set forth below:

Bonus Issue

Date of Allotment	No of Equity Shares	Face Value ( )	Issue Price ( )	Consideration
09/09/2022	24,76,219	10/-	NA	Other Than Cash Consideration

Listing of Shares on SME exchange of NSE

Your directors are pleased to inform you that the Companys securities have been listed on SME

Exchange of NSE Limited from 12^th June, 2023.

The company got its equity shares listed via Initial Public Offer on SME Exchange of NSE Limited:

The Company made initial Public Offer (IPO) for 24,25,000 Equity Shares for cash at a price of Rs. 135/- per share including a premium of Rs. 125/- per share aggregating to Rs. 3,273.75 Lakhs through an Initial Public Offer.

7. MANAGEMENT DISCUSSIONS AND ANALYSIS

The Management Discussion and Analysis Report on the operations of the Company, as required under Regulation 34 read with Schedule V of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as Listing Regulations) and as approved by the Board of Directors, is provided in a separate section and forms an integral part of this Report.

8. ANNUAL RETURN:

The Annual Return of the Company will be placed on the website of the company pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules 2014, the web link of the same is at https://www.sahanasystem.com/

9. PUBLIC DEPOSITS:

During the year under review, the Company has not accepted any deposits within the meaning of Section 73 and 76 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014, However, the Company has borrowed money as Unsecured Loan from Mr. Pratik Kakadia who is the promoter of the Company and M/s. Bartek Enterprise which is relative of KMP. However on the date of this director report, the company has repaid the said loans.

10. DIRECTORS RESPONSIBILITY STATEMENT:

To the best of knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statement in terms of Section 134(3) (c) of the Companies Act, 2013:

a. That in the preparation of the Annual Accounts for the year ended 31st March, 2023, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b. That the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the company for that period;

c. That the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

d. The Annual Accounts have been prepared on a going concern basis;

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

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

11. CORPORATE GOVERNANCE REPORT

As per the provisions of Regulation 15(2) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the provisions related to Corporate Governance as specified in Regulations 17, 18, 19, 20, 21,22, 23, 24, 25, 26, 27 and clauses (b) to (i) of sub-regulation (2) of regulation 46 and Para C, D and E of Schedule V shall not apply to a listed entity being listed on SME Exchange of NSE. Thereby presently the Company is not required to comply with the above provisions of Corporate Governance. Accordingly, the Report on Corporate Governance and Certificate regarding compliance of conditions of Corporate Governance are not made a part of the Annual Report.

12. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

EARNING / OUTGO:

Details regarding Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo are stated below: Pursuant to Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, details regarding Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo for the year under review are as follows:

A. Conservation of Energy

a. Steps taken or impact on conservation of energy

The Operations of the Company do not consume energy intensively. However, Company continues to implement prudent practices for saving electricity and other energy resources in day-to-day activities. b. Steps taken by the Company for utilizing alternate sources of energy Though the activities undertaken by the Company are not energy intensive, the Company shall explore alternative sources of energy, as and when the necessity arises.

B. Technology Absorption a. The efforts made towards technology absorption The Company continues to take prudential measures in respect of technology absorption, adaptation and take innovative steps to use the scarce resources effectively. b. In case of imported technology (imported during the last three years reckoned from the beginning of the financial year) Not Applicable

C. The Particulars of Foreign Exchange and Outgo for the year under review are:

(Rs. in Lakhs)

PARTICULARS	YEAR ENDED 31ST MARCH, 2023	YEAR ENDED 31ST MARCH, 2022
FOREIGN EXCHANGE EARNING	135.22	7.26
FOREIGN EXCHANGE OUTGO	NIL	NIL

13. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

During the year under review, no employee was in receipt of remuneration exceeding the limits as prescribed under provisions of Section 197 of the Companies Act, 2013 and Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

The necessary disclosure with respect to the remuneration of Directors and employees as required under Section 197(12) of the Companies Act, 2013 and Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been appended as Annexure I to this Report.

14. CASH FLOW AND CONSOLIDATED FINANCIAL STATEMENTS:

As required by Regulation 34(2) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, Cash Flow Statement is appended. As the Company does not have any Subsidiary Company or Associate Company or Joint Venture Company, it is not required to publish Consolidated Financial Statement.

15. DECLARATION BY INDEPENDENT DIRECTORS

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed under section 149(6) of the Companies Act, 2013 and Regulation 16 (1)(b) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

16. DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board received a declaration from all the directors under Section 164 and other applicable provisions, if any, of the Companies Act, 2013 that none of the directors of the company is disqualified under the provisions of the Companies Act, 2013 ("Act") or under the SEBI (Listing Obligation and Disclosure Requirements) Regulations 2015.

(I) APPOINTMENT & RESIGNATION OF DIRECTORS

During the financial year 2022-23, there were following changes in the board of directors of the company-

Name of Director	Date of Change	Particulars of Changes
Ms. Shardaben Rameshbhai Kakadiya	10th June, 2022	Resignation
Ms. Hetal Chaturbhai Patel	18th April, 2022	Change in Designation to Non- Executive Director
Mr. Hetang Arunkumar Shah	07th April, 2022	Change in Director to Managing Director
Ms. Ekta Ankit Patel	18th April, 2022	Appointment of as Independent Director
Ms. Nishita Mayank Sanghvi	18th April, 2022	Appointment of as Independent Director

Accordingly, at present, the structure of Board of Directors is as follows:

SR. NO. DESIGNATION	NAME OF DIRECTORS
1. Managing Director & Chairman	Mr. HETANG ARUNKUMAR SHAH (As Managing Director w.e.f. 07th April, 2022)
2. Non-Executive & Non- Independent	Mr. HETAL CHATURBHAI PATEL
3. Independent Director (Non-Executive)	Ms. EKTA ANKIT PATEL
4. Independent Director (Non-Executive)	Mr. NISHITA MAYANK SANGHVI

(II) RETIREMENT BY ROTATION

In accordance with the provisions of Section 152 of the Companies Act, 2013 read with Companies (Management & Administration) Rules, 2014 and Articles of Association of the Company, Ms. Hetal Chaturbhai Patel (DIN: 08381794), Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible, has offered herself for reappointment and your Board recommends her re- appointment.

(III) KEY MANAGERIAL PERSONNEL

During the year under review, there were following changes in Key Managerial Personnel of the company

Name of Director	Date of Change	Particulars of Changes
Mr. Hetang Arunkumar Shah	07th April, 2022	Change in Director to Managing Director
Mr. Pratik Ramjibhai Kakadia	06th October, 2022	Appointment as Chief Executive Officer (CEO)
Ms. Khushbu Ankitkumar Dalwadi	30th April, 2022	Appointment as Company Secretary & Compliance Officer (CS)
Mr. Jatin Dhirajlal Jogani	06th October, 2022	Appointment of Chief Financial Officer (CFO)

Accordingly, at present, the following are the Key Managerial Personnel of the company:

SR. NO. DESIGNATION	NAME OF DIRECTORS
1. Managing Director	Mr. Hetang Arunkumar Shah (as an MD w.e.f. 07/04/2022)
2. Chief Executive Officer (CEO)	Mr. Pratik Ramjibhai Kakadia (w.e.f 06/10/2022)
3. Company Secretary & Compliance Officer (CS)	Ms. Khushbu Ankitkumar Dalwadi (w.e.f 30/04/2022)
4. Chief Financial Officer (CFO)	Mr. Jatin Dhirajlal Jogan (w.e.f 06/10/2022)

17. MEETINGS OF THE BOARD

The Board meets at regular intervals to discuss and decide on Company / business policy and strategy apart from other Board business. A tentative annual calendar of the Board and Committee Meetings is informed to the Directors in advance to facilitate them to plan their schedule and to ensure meaningful participation in the meetings.

The notice of meeting of Directors and Committees is given well in advance to all the Directors of the Company. The agenda of the Board / Committee meetings is circulated not less than 7 days prior to the date of the meeting. The agenda for the Board and Committee meetings includes detailed notes on the items to be discussed at the meeting to enable the Directors to take an informed decision.

During the year under review, 22 (Twenty Two) Board Meetings were convened and the intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

NAME OF DIRECTOR	CATEGORY	NUMBER OF MEETINGS WHICH DIRECTOR WAS ENTITLED TO ATTEND	MEETINGS ATTENDED
Mr. HETANG ARUNKUMAR SHAH	Managing Director	22	22
Mr. HETAL CHATURBHAI PATEL	Non-Executive Director	22	22
MS. EKTA ANKIT PATEL	Independent Director	21	21
MS. NISHITA MAYANK SANGHVI	Independent Director	21	21

18. SEPARATE MEETING OF INDEPENDENT DIRECTORS

As stipulated by the Code of Independent Directors under Schedule IV of the Companies Act, 2013, a separate meeting of the Independent Directors of the Company was held on 21^st October, 2022 to review, among other things, the performance of non-independent directors and the Board as whole, evaluation of the performance of the Chairman and the flow of communication between the Board and the management of the Company.

19. COMMITTEES OF THE BOARD

The Companys Board has the following Committees:

• Audit Committee
• Nomination and Remuneration Committee
• Stakeholders Relationship Committee

i) AUDIT COMMITTEE:

The Board at its Meeting held on 09^th May, 2022 constituted the Audit Committee.

During the financial year 2022 -2023, (4) meetings of Audit Committee were held on 09^th May, 2022, 25^th August, 2022, 17^th December, 2022 and 09^th January, 2023.

The table below highlights the composition and attendance of the Members of the Committee. The requisite quorum was present at all the Meetings.

NAME OF MEMBERS	DESIGNATION	MEETINGS ATTENDED
MS. NISHITA MAYANK SANGHVI	CHAIRPERSON	4
MS. EKTA ANKIT PATEL	MEMBER	4
MS. HETANG ARUNKUMAR SHAH	MEMBER	4

The Company Secretary has acted as the Secretary to the Committee.

All the recommendations made by the Audit Committee were accepted by the Board of Directors. The terms of reference of the Audit Committee shall include but not limited to the following:

a) To recommend the appointment/re-appointment/ re-placement and terms of appointment of the Auditors of the Company.

b) To review and monitor Auditors independence and performance and effectiveness of audit process.

c) To review with the Management the Quarterly Financial Results before submission to the Board for approval.

d) Review the adequacy of internal control system. Finding of any internal investigations by the internal auditors in to matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the Board.

e) Approval or any subsequent modification of transactions of the Company with related parties.

f) Reviewing the Companys risk management policy.

g) To scrutinize inter-corporate loans and investments made by the Company. h) To evaluate the Internal Financial Controls and Risk Management Systems.

i) To carry out valuation of undertakings and the assets of the Company, wherever it is necessary.

j) To review, with the management, performance of Statutory and Internal Auditors, adequacy of the Internal Control System.

k) To review the functioning of the Whistle Blower Mechanism.

l) To approve appointment of Chief Financial Officer after assessing the qualifications, experience and background etc. of the candidate.

m) To carry out any other function, as may be assigned to Audit Committee pursuant to any amendments to the Listing Regulations and the applicable provisions of the Act.

n) To oversee the Companys financial reporting process and disclosure of the financial information to ensure that the financial statements are correct, sufficient and creditable.

o) To review the following information/document:

• Management Discussion and Analysis of financial condition and results of operation;
• Statement of significant related party transactions (as defined by the Audit Committee), submitted by management;
• Management letter/letters of internal control weakness issued by the Statutory Auditors;
• Internal audit reports relating to internal control weakness;
• Quarterly statement of deviation(s) including report of monitoring agency, if applicable, submitted to stock exchange(s) in terms of Regulation 32(1) of the Listing Regulations.

ii) NOMINATION AND REMUNERATION COMMITTEE

The Board at its Meeting held on 09^th May, 2023 constituted the Nomination and remuneration Committee (hereinafter referred as "NRC").

During the financial year 2022-23, 2 (Two) meetings of NRC were held on 09^th September, 2022, and 22^nd March, 2023.

The table below highlights the composition and attendance of the Members of the Committee. The requisite quorum was present at the Meeting.

NAME OF MEMBERS	DESIGNATION	MEETINGS ATTENDED
MS. NISHITA MAYANK SANGHVI	CHAIRPERSON	2
MS. EKTA ANKIT PATEL	MEMBER	2
MS. HETAL CHATURBHAI PATEL	MEMBER	2

The Company Secretary has acted as the Secretary to the Committee.

The broad terms of reference of the NRC, as approved by the Board, are in compliance with Section 178 of the Companies Act, 2013 which are as follows:

a) To lay down criteria for determining qualifications, positive attributes and independence of a Director and recommend to the Board of Directors a policy relating to the remuneration of the Directors, Key Managerial Personnel and other employees.

b) To formulate a criteria for evaluation of performance of Independent Directors and the Board of Directors.

c) To recommend remuneration to be paid to a Director for any service rendered by him to the Company which are of a professional nature and provide an opinion, whether such Director possess the requisite qualification for the practice of such profession.

d) To identify persons who are qualified to become Directors and who may be appointed in Senior Management in accordance with the criteria laid down, and recommend to the Board of Directors their appointment and removal.

e) To decide whether to extend or continue the term of appointment of the Independent Director, on the basis of the report of performance evaluation of Independent Directors.

f) To recommend to the Board the appointment and removal of the Directors, including Independent Directors.

g) Carrying out functions as delegated by the Board of Directors from time to time.

The Board of Directors has framed "Remuneration and Nomination Policy" which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. This policy also lays down criteria for selection and appointment of Board Members. The said Policy is annexed herewith as Annexure - II to this report.

iii) STAKEHOLDERS RELATIONSHIP COMMITTEE

The Board at its Meeting held on 09^th May, 2023 constituted the Stakeholder Relationship Committee. (hereinafter referred as "SRC")

During the financial year 2022-23, 10^th September, 2022 (One) meeting of SRC were held as there are not more than 1000 shareholders.

The table below highlights the composition and attendance of the Members of the Committee. The requisite quorum was present at the Meeting.

NAME OF MEMBERS	DESIGNATION	MEETINGS ATTENDED
MS. EKTA ANKIT PATEL	CHAIRPERSON	01
MS. NISHITA MAYANK SANGHVI	MEMBER	01
MR. HETANG ARUNKUMAR SHAH	MEMBER	01

The Company Secretary has acted as the Secretary to the Committee.

Stakeholders Relationship Committee is empowered to oversee the Redressal of Stakeholders complaints pertaining to transfer of shares, non-receipt of annual reports, non-receipt of declared dividends, issue of duplicate certificates, transmission /demat / remat of shares and other miscellaneous grievances.

20. ANNUAL PERFORMANCE EVALUATION BY THE BOARD

Pursuant to the provisions of the Act and the Listing Regulations, a structured questionnaire was prepared after taking into consideration the various aspects of the Boards functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance. The performance evaluation of the Directors was completed during the year under review.

The performance evaluation of the Chairman and the Non-Independent Directors was carried out by the Independent Directors and Non-Executive Director. The Board of Directors expressed their satisfaction with the evaluation process.

21. DIRECTORS TRAINING AND FAMILIARIZATION

The Company undertakes and makes necessary provision of an appropriate induction programme for new Director(s) and ongoing training for existing Directors. The new Director(s) are introduced to the Company culture, through appropriate training programmes. Such kind of training programmes helps develop relationship of the directors with the Company and familiarize them with Company processes. The management provides such information and training either at the meeting of Board of Directors or at other places.

The induction process is designed to:

• build an understanding of the Companys processes and
• fully equip Directors to perform their role on the Board effectively

Upon appointment, Directors receive a Letter of Appointment setting out in detail, the terms of appointment, duties, responsibilities and expectations from them.

22. DETAILS OF FRAUD REPORT BY AUDITOR:

As per auditors report, no fraud u/s 143 (12) reported by the auditor.

23. AUDITORS

(I) STATUTORY AUDITORS:

M/S Rahul Mistri & Co., Chartered Accountants, Surat having Firm Registration No. 0120410W, were appointed as Statutory Auditors of the Company for a term of 05 (Five) years for the financial year 2021-2022 to 2025-2026, on such remuneration as may be fixed by the Board of Directors of the Company.

M/s. Rahul Mistri & Co., vide letter dated 24^th August, 2023 has tendered his resignation as the Statutory Auditors of the Company due to Pre-occupation.

Board hereby recommends to the Shareholders for the appointment of M/s. A.K. Ostwal & Co., Chartered Accountant (Firm Registration Number: 107200W), as a Statutory Auditor of the Company at the upcoming Annual General Meeting for financial year 2023-24 to fill in the casual vacancy caused by resignation of M/s. Rahul Mistri & Co .

Notes on financial statement referred to in the Auditors Report are self-explanatory and do not call for any further comments. The Auditors Report does not contain any qualification, reservation or adverse remark.

(II) INTERNAL AUDITORS:

As the Company was in process to undergo listing of its securities with Emerge Exchange of NSE Limited during the financial year 2022-23. The company got its securities listed on June 12, 2023, Appointment of Internal Auditor of the Company is not applicable Pursuant to Provision of Section 138 of The Companies Act, 2013, read with Companies (Accounts) Rules, 2014.

(III) SECRETARIAL AUDITORS:

As the Company was in process to undergo listing of its securities with Emerge Exchange of NSE Limited during the financial year 2022-23. The company got its securities listed on June 12, 2023 and hence pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has hereby appointed M/s. Mukesh J. & Associates, Company Secretaries, Ahmedabad, Gujarat to conduct Secretarial Audit of the company as applicable by virtue of listing of securities for the year ended on 31st March, 2023.

Secretarial Audit Report issued by M/s. Mukesh J. & Associates, , Company Secretaries in Form MR- 3 is annexed herewith as Annexure IV and forms an integral part of this Report. The reply to observations of Secretarial Auditor is attached as addendum to Directors report

24. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Internal financial controls of the company are adequate keeping in mind Companys business size and mode of operations. All process and safety measures are followed to protect from any financial or business loss, unauthorized use or disposition of its assets. All the transactions are properly regulated through proper channels to maintain control.

The Company is adhering to all the applicable Accounting Standards. Further, there are teams which looks after the internal checks and verifies the internal control system in accordance with policies of the Company.

25. DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES:

As the Company is not having net worth of rupees five hundred Crores or more, or turnover of rupees one thousand Crores or more or a net profit of rupees five Crores or more during previous financial year,

The Company is not required to comply with the provisions of Section 135 of the Companies Act, 2013 with the regard to the formation of the CSR Committee and undertaking of Social Expenditure as required under the said Section.

26. SUBSIDIARIES, ASSOCIATE COMPANIES AND JOINT VENTURES

As Company does not have any Subsidiaries or Associates Companies or Joint ventures, it is not required to give disclosure in Form AOC-1 Pursuant to first proviso to sub-section (3) of Section 129 read with Rule 5 of Companies (Accounts) Rules, 2014.

27. RELATED PARTY TRANSACTIONS

All Related Party Transactions that were entered into during the financial year were on an arms length basis, in the ordinary course of business and were in compliance with the applicable provisions of the Act and the Listing Regulations.

There were no materially significant Related Party Transactions made by the Company with Promoters, Directors, Key Managerial Personnel which may have a potential conflict with the interest of the Company at large. All Related Party Transactions are placed before the Audit Committee for approval. Prior omnibus approval of the Audit Committee is obtained for the transactions which are repetitive in nature.

A statement of all Related Party Transactions is placed before the Audit Committee for its review on a quarterly basis, specifying the nature, value and terms and conditions of the transactions, if any. The Company has adopted a Related Party Transactions Policy.

The details have been enclosed pursuant to clause (h) of subsection (3) of Section 134 of Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules 2014 ‘AOC-2-

Annexure III.

28. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY THE COMPANY:

The particulars of loans, guarantees and investments, if any taken or given, have been disclosed in the financial Statement.

29. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION

OF THE COMPANY

The material changes and commitments affecting the financial position of the Company between the end of the financial year of the Company to which the financial statements relate and the date of the report are mentioned as below:

Initial Public Offer & consequent listing of Shares on SME Exchange of NSE Limited:

The Company made initial Public Offer (IPO) for 24,25,000 Equity Shares for cash at a price of Rs. 135/- per share including a premium of Rs. 125/- per share aggregating to Rs. 3,273.75 Lakhs through an Initial Public Offer. Your Directors are pleased to inform you that the Companys securities have been listed on SME Exchange of NSE Limited w.e.f 12^th June, 2023.

30. VIGIL MECHANISM / WHISTLE BLOWER POLICY

In pursuance to Section 177 of the Companies Act, 2013, the Company has adopted a Vigil Mechanism / Whistle Blower Policy to deal with instance of fraud and mismanagement, if any.

The Company promotes ethical behavior in all its business activities and has adopted a mechanism of reporting illegal or unethical behavior. The Company has a whistle blower policy wherein the employees are free to report violations of laws, rules, regulations or unethical conduct to their immediate supervisor or such other person as may be notified by the management to the employees / workers. The mechanism also provides for adequate safeguards against victimization of directors and employees who avail of the mechanism and also provide for direct access to the Chairperson of the Audit Committee in the exceptional cases. The confidentiality of those reporting violation is maintained and they are not subjected to any discriminatory practice. However, no violation of laws or unethical conduct etc. was brought to the notice of the Management or Audit Committee during the year ended 31st March, 2023. We affirm that during the financial year 2022-23, no employee or director was denied access to the Audit Committee.

31. RISK MANAGEMENT POLICY

Your Company has an elaborated risk Management procedure and adopted systematic approach to mitigate risk associated with accomplishment of objectives, operations, revenues and regulations. Your Company believes that this would ensure mitigating steps proactively and help to achieve stated objectives. The entitys objectives can be viewed in the context of four categories Strategic, Operations, Reporting and Compliance. The Risk Management process of the Company focuses on three elements, viz. (1) Risk Assessment; (2) Risk Management; (3) Risk Monitoring.

Audit Committee has been entrusted with the responsibility to assist the Board in (a) Overseeing and approving the Companys enterprise wide risk management framework; and (b) Overseeing that all the risk that the organization faces. The key risks and mitigating actions are also placed before the Audit Committee of the Company. Significant audit observations and follow up actions thereon are reported to the Audit Committee. The Committee reviews adequacy and effectiveness of the Companys internal control environment and monitors the implementation of audit recommendations, including those relating to strengthening of the Companys risk management policies and systems.

32. POLICY ON PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE

Your company believes in providing a healthy, safe and harassment-free workplace for all its employees. Further company ensures that every women employee is treated with dignity and respect.

The Company has in place an Anti-Sexual Harassment Policy as per the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013.

Your Directors further states that during the year under review, there were no cases filed pursuant to the Sexual Harassment of Woman at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

33. Details of Application made or proceeding pending under Insolvency And

Bankruptcy Code 2016

During the year under the review, there were no applications made or proceedings pending in the name of the company under the insolvency and bankruptcy code, 2016.

34. Details of Difference between valuation amount on one time settlement and valuation while availing loan from banks and financial institutions.

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

35. ACKNOWLEDGEMENT

The Board of Directors wishes to express its gratitude and record its sincere appreciation for the commitment and dedicated efforts put in by all the employees. Your Directors take this opportunity to express their grateful appreciation for the encouragement, cooperation and support received by the Company from the local authorities, bankers, clients, suppliers and business associates. The directors are thankful to the esteemed shareholders for their continued support and the confidence reposed in the Company and its management.

FOR, SAHANA SYSTEM LIMITED

SD/-

HETANG ARUNKUMAR SHAH

MANAGING DIRECTOR

DIN: 02710970

Registered Office:

901-A-Block, Mondeal Square, Nr. Iscon Elegance, S.G. Highway,

Prahladnagar, Ahmedabad-380015

Place: Ahmedabad

Date: 29/08/2023