3.12 Provisions, Contingent Liabilities and Contingent Assets:
Provision is recognized when the Company has a present obligation (legal or constructive) as a result of past events and it
is probable that the outflow of resources will be required to settle the obligation and in respect of which reliable estimates
can be made.
A disclosure for contingent liability is made when there is a possible obligation, that may, but probably will not require
an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of
outflow of resources is remote, no provision/ disclosure is made. The Company does not recognize a contingent liability
but discloses its existence in the financial statements.
Contingent assets are not recognized in the financial statements. Provisions and contingencies are reviewed at each
balance sheet date and adjusted to reflect the correct management estimates.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, using
a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. Commitments include the amount of
purchase order (net of advances) issued to parties for completion of assets. Provisions, contingent liabilities, contingent
assets and commitments are renewed at each balance sheet date.
3.13 Cash and Cash Equivalents
Cash and cash equivalent comprise cash on hand and demand deposits with banks which are short-term, highly liquid
investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes
in value.
3.14 Leases
The Company as a lessee
The Company assesses whether a contract contains a lease, at inception of a contract. A contract is, or contains, a lease
if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.
To assess whether a contract conveys the right to control the use of an identified asset, the Company assesses whether:
(i) the contract involves the use of an identified asset (ii) the Company has substantially all of the economic benefits from
use of the asset through the period of the lease and (iii) the Company has the right to direct the use of the asset.
At the date of commencement of the lease, the Company recognizes a right-of-use asset (“ROU”) and a corresponding
lease liability for all lease arrangements in which it is a lessee, except for leases with a term of twelve months or less
(short-term leases) and low value leases. For these short-term and low value leases, the Company recognizes the lease
payments as an operating expense on a straight-line basis over the term of the lease.
As a lessee, the Company determines the lease term as the non-cancellable period of a lease adjusted with any option to
extend or terminate the lease, if the use of such option is reasonably certain. The Company makes an assessment on the
expected lease term on a lease-by-lease basis and thereby assesses whether it is reasonably certain that any options to
extend or terminate the contract will be exercised. In evaluating the lease term, the Company considers factors such as
any significant leasehold improvements undertaken over the lease term, costs relating to the termination of the lease and
the importance of the underlying asset to Infosys's operations taking into account the location of the underlying asset and
the availability of suitable alternatives. The lease term in future periods is reassessed to ensure that the lease term reflects
the current economic circumstances.
Certain lease arrangements include the options to extend or terminate the lease before the end of the lease term. ROU
assets and lease liabilities includes these options when it is reasonably certain that they will be exercised.
The ROU assets are initially recognized at cost, which comprises the initial amount of the lease liability adjusted for any
lease payments made at or prior to the commencement date of the lease plus any initial direct costs less any lease incen¬
tives. They are subsequently measured at cost less accumulated depreciation and impairment losses.
ROU assets are depreciated from the commencement date on a straight-line basis over the shorter of the lease term and
useful life of the underlying asset. Right-of-use-assets are evaluated for recoverability whenever events or changes in
circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the
recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual
asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such
cases, the recoverable amount is determined for the Cash Generating Unit (CGU) to which the asset belongs.
The lease liability is initially measured at amortized cost at the present value of the future lease payments. The lease
payments are discounted using the interest rate implicit in the lease or, if not readily determinable, using the incremental
borrowing rates in the country of domicile of these leases.
Lease liabilities are remeasured with a corresponding adjustment to the related right-of-use asset if the Company changes
its assessment to whether it will exercise an extension or a termination option.
Lease liability and ROU asset have been separately presented in the Balance Sheet and lease payments have been
classified as financing cash flows.
The Company as a lessor
Leases for which the Company is a lessor is classified as a finance or operating lease. Whenever the terms of the lease
transfer substantially all the risks and rewards of ownership to the lessee, the contract is classified as a finance lease. All
other leases are classified as operating leases.
When the Company is an intermediate lessor, it accounts for its interests in the head lease and the sublease separately.
The sublease is classified as a finance or operating lease by reference to the right-of-use asset arising from the head
lease.
For operating leases, rental income is recognized on a straight-line basis over the term of the relevant lease.
3.15 Exceptional items
Certain occasions, the size, type or incidence of an item of income or expense, pertaining to the ordinary activities of
the Company is such that its disclosure improves the understanding of the performance of the Company, such income
or expense is classified as an exceptional item and accordingly, disclosed in the notes accompanying to the financial
statements.
During the FY 2023-24, following transactions under taken by promotor group entities :-
a) Fineline Holding Limited disposed 10,22,737 Shares representing 5.26% of total issued & paid up equity share capital to DBS
Bank Limited.
b) Fineline Holding Limited disposed 34,70,408 Shares representing 17.84 % of total issued & paid up equity share capital to
Mr.Narendra Kumar Ramesh Chandra Raval.
c) Yans Enterprises (H.K) Limited disposed 12,56,692 Shares representing 6.46 % of total issued & paid up equity share capital
to Mr.Narendra Kumar Ramesh Chandra Raval.
d) Yans Enterprises (H.K) Limited disposed 40,80,188 Shares representing 20.97 % of total issued & paid up equity share capital
to Mrs. Shreya Agarwal & Mr. Manohar Tikamdas Ruprell.
(a) Star Strength- External Commercial Borrowings ( Assigned from DBS Bank Limited) -
ECBs carry interest @ 4.50% p.a. plus 6 months LIBOR / ARR (as per revised RBI Regulaations) and are secured by first
pari passu charge of land & building of Hotel Hyatt Regency Delhi and unsold area of New Tower Block A in Hyatt Regency
Delhi, first pari passu charge on movable fixed assets (Excluding vehicles, windmills and power saving equipment), first pari
passu charge on current assets (Present and Future), personal guarantee of Mr. Shiv Kumar Jatia (Resigned from Chairman
& Managing Director w.e.f 21st October, 2021) & Mr. Amritesh Jatia (resigned from Chairman and Managing Director w.e.f.
16th July, 2024) pledge of shares representing Company's investment in foreign subsidiary company. External commercial
borrowings are repayable as under: (i) USD 161.67 Lakhs is payable in 16 unequal half yearly instalments till March, 2030; (iii)
USD 130.25 Lakhs is payable in 9 unequal half yearly instalments till March, 2030.
Company has signed OTS Agreement to settle the credit facilities of Star Strength vide Agreement dated 30th July,2024 in
accordance of which credit facilities will be paid on or before 30th September, 2024 but it is not completed due to technical/legal
issues so, Amendment Agreement dated 28th October, 2024 is signed to settle dues upto 31st March, 2025 but it also not being
completed. Company is in process to further extension of agreement & settle the same in FY 2024-25.
All the Above mentioned Credit facilities are secured by:-
(a) a first charge, by way of mortgage, in a form and manner satisfactory to the Lenders on all the leasehold / freehold rights of the
Borrower on the Hotel Property, both present and future;
(b) a first charge on all movable and current assets of the Borrower including movable plant and machinery, machinery spares,
tools and accessories, equipment and all other movable assets (including cashflows present or arising in future) of the Borrower
including in relation to the Hotel Property, both present and future:
(c) all chose in action which may give rise to any debt, revenue or monetary claim which due and owing or accruing or may become
due and owing or accrue to the Borrower and the benefits of any security, guarantee or other rights in relation to any of the
foregoing
(d) All moneys including insurance proceeds payable under insurance contracts for the Hotel Property, and investments lying to the
credit of the lender's escrow/current account and other accounts or liable to be credited to the escrow/current account, or other
receivables, monies received/receivable as liquidated damages liable to be credited to the escrow/current account designated
for receiving money, claims or other money proceeds or receivables of whatsoever nature including by way of assignment of
lease rentals, cash filows, treasury income, revenues/receivables of the hotel in the course of its business, together with any
interest from time to time accruing in respect of such moneys”
- Compensated absences - Earned leave
In accordance with Indian Accounting Standard 19, actuarial valuation was done in respect of the aforesaid defined benefit
plans based on the following assumptions-
Economic Assumptions
The discount rate and salary increases assumed are the key financial assumptions and should be considered together; it
is the difference or 'gap' between these rates which is more important than the individual rates in isolation.
Discount Rate
The discounting rate is based on the gross redemption yield on medium to long term risk free investments. The estimated
term of the benefits/obligations works out to zero years. For the current valuation a discount rate of 6.99% p.a. (Previous
Year 7.22% p.a.) compound has been used.
Salary Escalation Rate
The salary escalation rate usually consists of at least three components, viz. regular increments, price inflation and
promotional increases. In addition to this any commitments by the management regarding future salary increases and the
Company's philosophy towards employee remuneration are also to be taken into account. Again a long-term view as to
trend in salary increase rates has to be taken rather than be guided by the escalation rates experienced in the immediate
past, if they have been influenced by unusual factors.
41. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Company's financial risk management is an integral part of how to plan and execute its business strategies. The company's
financial risk management policy is set by the Managing Board.
Market risk
Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in the price of a
financial instrument. The value of a financial instrument may change as a result of changes in the interest rates, foreign currency
exchange rates, equity prices and other market changes that affect market risk sensitive instruments. Market risk is attributable
to all market risk sensitive financial instruments including investments and deposits, foreign currency receivables, payables and
loan borrowings.
The Company manages market risk through a treasury department, which evaluates and exercises independent control over
the entire process of market risk management. The treasury department recommends risk management objectives and policies,
which are approved by Senior Management and the Audit Committee. The activities of this department include management of
cash resources, implementing hedging strategies for foreign currency exposures, borrowing strategies, and ensuring compliance
with market risk limits and policies.
Interest rate risk
Interest rate risk is the risk that fair value or future cash flows of a financial instrument will fluctuate because of changes in
market interest rates. In order to optimize the company's position with regards to the interest income and interest expenses and
to manage the interest rate risk, treasury performs a comprehensive corporate interest rate risk management by balancing the
proportion of fixed rate and floating rate financial instruments in it total portfolio.
The company is not exposed to significant interest rate risk as at the specified reporting date.
Refer Note 18 and Note 21 for interest rate profile of the Company's interest-bearing financial instrument at the reporting date.
Foreign currency risk
The Company operates locally, however, the nature of its operations requires it to transact in in several currencies and
consequently the Company is exposed to foreign exchange risk in various foreign currencies.
The Company evaluates exchange rate exposure arising from foreign currency transactions and the Company follows
established risk management policies.
I. Foreign Currency Exposure
Refer Note 37 for foreign currency exposure as at March 31, 2025 and March 31, 2024 respectively.
Credit risk
Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. To manage this, the
Company periodically assesses the financial reliability of customers, taking into account the financial condition, current economic
trends, and analysis of historical bad debts and ageing of accounts receivable. Individual risk limits are set accordingly.
The Company considers the probability of default upon initial recognition of asset and whether there has been a significant
increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is significant increase in
credit risk the company compares the risk of a default occurring an the asset at the reporting date with the risk of default as the
date of initial recognition. It considers reasonable and supportive forwarding-looking information such as:
(i) Actual or expected significant adverse changes in business,
(ii) Actual or expected significant changes in the operating results of the counterparty.
(iii) Financial or economic conditions that are expected to cause a significant change to the counterparty's ability to mere its
obligation,
(iv) Significant increase in credit risk on other financial instruments of the same counterparty.
(v) Significant changes in the value of the collateral supporting the obligation or in the quality of third-party guarantees or
credit enhancements.
Financial assets are written off when there is no reasonable expectation of recovery, such as a debtor failing to engage in a
repayment plan with the Company. The Company categorizes a loan or receivable for write off when a debtor fails to make
contractual payments greater than 2 years past due. Where loans or receivables have been written off, the Company
continues to engage in enforcement activity to attempt to recover the receivable due. Where recoveries are made, these
are recognized in profit or loss.
IV. Provision for expected credit losses again “II” and “III” above
The company has assets where the counter- parties have sufficient capacity to meet the obligations and where the risk
of default is very low. Hence based on historic default rates, the Company believes that, no impairment allowance is
necessary in respect of above mentioned financial assets.
Liquidity Risk
Liquidity Risk is defined as the risk that the company will not be able to settle or meet its obligations on time or at reasonable
price. The company's treasury department is responsible for liquidity, funding as well as settlement management. In addition,
processes and policies related to such risks are overseen by senior management. Management monitors the company's net
liquidity position through rolling forecast on the basis of expected cash flows.
41. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES ...contd.
Maturity profile of financial liabilities
The table below provides details regarding the remaining contractual maturities (including Overdues) of financial liabilities at
the reporting date based on contractual undiscounted payments..
(iii) Details of Benami Property held :
The Company does not have any Benami property, which any proceeding has been initiated or pending against the
Company for holding any Benami property.
(iv) Borrowings secured against current assets
The Company has borrowings from banks on the basis of security of current assets. Currently OD limits are out of order
& negotiation is going on with bankers to restructure the same.
(v) Utilisation of borrowed funds and share premium :
The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities
(Intermediaries) with the understanding that the Intermediary shall:
(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of
the group (Ultimate Beneficiaries) or
(b) provide any guarantee, security to or on behalf of the Ultimate Beneficiaries
The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with
the understanding (whether recorded in writing or otherwise) that the group shall:
(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of
the Funding Party (Ultimate Beneficiaries) or
(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(vi) Utilisation of borrowings availed from banks and financial institutions
The borrowings obtained by the Company financial institutions have been applied for the purposes for which such loans
were taken.
(vii) Wilful defaulter
The Company has not been declared wilful defaulter by any bank or financial Institution or other lender.
(viii) Relationship with struck off companies
The Company did not have any transactions with Companies struck off u/s companies Act, 2013 or Companies Act, 1956.
(ix) Compliance with number of layers of companies
The Company had complied with the number of layers prescribed under the Section 2(87) of the Act read with the
Companies ( Restriction on number of Layers ) Rules,2017.
(x) Compliance with approved scheme(s) of arrangements
The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous
financial year.
(xi) Undisclosed income
The Company does not have any transaction which is not recorded in the books of accounts that has been surrendered
or disclosed as income during the year in the tax assessments under the income Tax Act,1961 (such as, search or survey
or any other relevant provision of the Income Tax Act,1961).
(xii) Loans or advances to specified persons
The Company has not granted loans or advances to promoters, directors, key management personnel and the related
parties (as defined under Companies Act, 2013) either severally or jointly with any other person, that are: (a) repayable on
demand or (b) without specifying any terms or period of repayment.
(xiii) Details of crypto currency or virtual currency
The Company has not traded or invested in Crypto currency or Virtual Currency during the current or previous years.
(xiv) Valuation of Property, Plant and Equipment, intangible assets and investment property
The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets or
both during the current or previous year.
(xv) Title deeds of immovable properties not held in name of the Company
The title deeds of immovable properties (other than immovable properties where the Company is the lessee and the leas¬
es agreements are duly executed in favour of the company) are held in the name of the Company.
Note 43: Loss of Control over Foreign Subsidiaries
In respect of foreign subsidiaries, i.e., M/s Fineline Hospitality & Consultancy Pte Ltd. (FHCPL) & M/s Lexon Hotels Venture
Ltd., Mauritius (Lexon) an order for appointment of liquidator has been passed by the competent authority in Mauritius. As a
result of the same, the Company has lost control of these entities. Further, during the year liquidation order is being passed by
competent authority in Mauritius for liquidation of Fineline Hospitality & Consultancy Pte Ltd. (FHCPL) & Lexon Hotels Venture
Ltd., Mauritius (Lexon). Accordingly, the Company will not be presenting Consolidated Financial Statements.
Note: 46 : Current State of Business Operations and Ability to Continue as Going Concern
The Company's financial statements are prepared on a going concern basis, which contemplates the utilization of assets and
the satisfaction of obligations in the normal course of business. The operating profitability for the Company is improving sig¬
nificantly and it will be further aided by several cost reduction measures being adopted by the Company. The Company is in
amicable discussions with Banks and Financial Institutions, to resolve financial matters in the best interest for bankers as well
as shareholders. The Management is confident that its planned financial settlement will enable the Company to continue as a
going concern.
Note 47 :-Balances shown under trade receivables, trade payables, loans & advances, deposits are subject to confirmation, reconcil¬
iation & consequential adjustment, if any. The re-conciliation is carried out on ongoing basis & provisions wherever considered
necessary have been made in line with the guidelines. Request for confirmations of balances were sent and reconciliations with
the parties are carried out as an ongoing process.
Note 48:- In the opinion of the Board of Directors, the Current Assets, Loans & Advances have the value, which on realization in the
ordinary course of business would be at least equal to the amount stated in the balance sheet.
Note 49:- All the expenses, income, assets and Liabilities have been accounted for, ascertained with reasonable certainty and
accuracy.
Note 50:- No personal expenses have been charged to revenue accounts, other than those payable under contractual obligation.
Note 51:- Company has paid penalty amounting to INR 6,00,000/- (Six Lakhs) on May 09, 2024 to the Securities and Exchange Board
of India ('SEBI') pursuant to adjudication order dated April 25, 2024 issued by SEBI pursuant to the violation of Regulation 4(1)
(d), (e) & (h) and Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015
Note 52:- The Company has received Rs. 331.51 Crores as Advance for Sale of properties during the year ending
March 31, 2025.
Note 53:- Regrouped, Recast, Reclassified
Figures of the earlier year have been regrouped or reclassified to confirm to Ind AS presentation requirements.
The accompanying notes are integral part of the financial statements
As per our report of even date attached On behalf of the Board of Directors
For V V KALE & CO. Asian Hotels (North) Limited
Chartered Accountants
Firm Registration No. 000897N
Vijay V. Kale PREETI GANDHI ARUN GOPAL AGARWAL
Partner Chairperson and Independent Director Executive Director
Membership Number: 080821 DIN: 08552404 DIN: 00374421
Place: New Delhi TARUN SRIVASTAVA SUNIL UPADHYAY
Dated: 28.05.2024 Company Secretary and Compliance Officer Chief Financial Officer
UDIN: 25080821BMGZTI9908
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