i) Provisions, Contingent Liabilities & Contingent Assets:
The Company recognises provisions when there is present obligation as a result of past event and it is probable that there will be an outflow of resources and reliable estimate can be
made of the amount of the obligation. If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows to net present value
using an appropriate pre-tax discount rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. Unwinding of the
discount is recognised in the Statement of Profit and Loss as a finance cost. Provisions are reviewed at each reporting date and are adjusted to reflect the current best estimate.
A present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be
made, is disclosed as a contingent liability. Contingent Liabilities are also disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed
only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company.
Contingent assets are not recognized in financial statements since this may result in the recognition of income that may never be realised.
j) Investments in Subsidiary Company:
Investments in subsidiary companies are measured at cost less impairment
k) Financial instruments:
Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual provisions of the instrument.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial
liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to ordeducted from the fair value of the financial assets orfinancial liabilities, as
appropriate, on initial recognition. Transaction costs directly attributable to the acquisition offinancial assets or financial liabilities at fair value through profit or loss are recognised
immediately in profit or loss.
Financial assets
(i) Financial assets carried at amortised cost
A financial asset is subsequently measured at amortised cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the
contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
(ii) Financial assets at fair value through other comprehensive income
A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting
contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and
interest on the principal amount outstanding. Further, in case where the company has made an irrevocable selection based on its business model, for its investments which are classified
as equity instruments, the subsequent changes in fair value are recognized in other comprehensive income.
(iii) Financial assets at fair value through profit or loss
A financial asset which is not classified in any of the above categories are subsequently fair valued through profit or loss.
(iv) The Company recognizes loss allowances using the expected credit loss (ECL) model for the financial assets which are not fair valued through profit or loss. Loss allowance for trade
receivables with no significant financing component is measured at an amount equal to lifetime ECL. For all otherfinancial assets, expected credit losses are measured at an amount equal
to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL. The amount of expected credit
losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognised is recognized as an impairment gain or loss in
statement of profit or loss.
Financial liabilities and equity instruments
Classification as debt or equity
Financial liabilities and equity instruments issued by the Company are classified according to the substance of the contractual arrangements entered into and the definitions of a financial
liability and an equity instrument.
Equity Instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. Equity instruments are recorded at the proceeds
received, net of direct issue costs.
Financial Liabilities
Financial liabilities such as borrowings are initially measured at fair value, net of transaction costs, and are subsequently measured at amortised cost, using the effective interest rate
method where the time value of money is significant.
Interest bearing bank loans, overdrafts and unsecured loans are initially measured at fair value and are subsequently measured at amortised cost usingthe effective interest rate method.
Any difference between the proceeds (net of transaction costs) and the settlement or redemption of borrowings is recognised over the term of the borrowings in the statement of profit
and loss.
Derecognition of financial instruments
The Company derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer qualifies for
derecognition under Ind AS 109. A financial liability (or a part of a financial liability) is derecognized from the Company's balance sheet when the obligation specified in the contract is
discharged or cancelled or expires.
Fair value of financial instruments
In determining the fair value of its financial instruments, the Company uses a variety of methods and assumptions that are based on market conditions and risks existing at each reporting
date. The methods used to determine fair value include discounted cash flow analysis, available quoted market prices and dealer quotes. All methods of assessing fair value
result in general approximation of value, and such value may or may not be realized.
Offsetting financial instruments
Financial assets and liabilities are offset and the net amount is reported in the balance sheet where there is a legally enforceable right to offset the recognized amounts and there is an
intention to settle on a net basis or realize the asset and settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable
in the normal course of business and in the event of default, insolvency or bankruptcy of the Company or the counterparty.
l) Earnings Per Share :
Basic earnings per share is computed by dividing profit or loss attributable to equity shareholders of the Company by the weighted average number of equity shares outstanding during
the period. The Company did not have any potentially dilutive securities in any of the periods presented.
m) Cash and cash equivalents:
The Company considers all highly liquid investments, which are readily convertible into known amounts of cash that are subject to an insignificant risk of change in value, to be cash
equivalents. Cash and cash equivalents consist of balances with banks which are unrestricted for withdrawal and usage.
n) Segment Reporting - Identification of Segments:
An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, whose operating results are regularly
reviewed bythe company's chief operatingdecision maker to make decisions for which discrete financial information is available. Based on the management approach as defined in Ind AS
108, the chief operating decision maker evaluates the Company's performance and allocates resources based on an analysis of various performance indicators by business segments and
geographic segments.
o) Leases:
The Company determines whether an arrangement contains a lease by assessing whether the fulfilment of a transaction is dependent on the use of a specific asset and whether the
transaction conveys the right to use that asset to the Company in return for payment. Where this occurs, the arrangement is deemed to include a lease and is accounted for either as
finance or operating lease.
As lessee
Leases of property, plant and equipment where the Company, as lessee, has substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are
capitalized at the lease's inception at the fair value of the leased property or, if lower, the present value of the minimum lease payments. The corresponding rental obligations, net of
finance charges, are included in borrowings or other financial liabilities as appropriate. Each lease payment is allocated between the liability and finance cost. The finance cost is charged
to the profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.
Leases in which a significant portion ofthe risks and rewards of ownership are not transferred to the Companyas lessee are classified as operating leases. Payments made under operating
leases are charged to Statement of profit and loss on a straight line basis over the period ofthe lease unlessthe payments are structured to increase in line with expected general inflation
to compensate for the lessor's expected inflationary cost increases.
With effective from 1 April 2019:
As a lessee:
The Company assess 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:
(1) The Contract involves the use of an identified asset;
(2) The Company has substantially all the economic benefits from use of the asset through the period of the lease and
(3) The Company has the right to direct the use of the asset.
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 oftwelve 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. Certain lease arrangements includes 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 right-of-use 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 incentives.
They are subsequently measured at cost less accumulated depreciation and impairment losses.
Right-of-use assets are depreciated from the commencement date on a straight-line basis over the balance lease term 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.
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 the leases. Lease liabilities are re-measured with a corresponding adjustment to the
related right of use asset if the company changes its assessment if whether it will exercise an extension or a termination option.
Lease liability and ROU asset shall be separately presented in the Balance Sheet and lease payments shall be classified as financing cash flows.
p) Rounding off amounts:
All amounts disclosed in the financial statements and notes have been rounded off to the nearest thousands as per the requirement of Schedule III, unless otherwise stated.
q) Standards issued but not yet effective:
Recent pronouncements Ministry of Corporate Affairs (“MCA”) notifies new standards or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as
issued from time to time. For the year ended March 31, 2025, MCA has not notified any new standards or amendments to the existing standards applicable to the Company.
Cost recognition
Costs and expenses are recognised when incurred and have been classified according to their nature.
Costs and expenses are recognised when incurred and have been classified according to their nature. The costs of the Company are broadly categorised in employee benefit expenses, cost
of equipment and software licences, depreciation and amortisation expense and other expenses. Other expenses mainly include fees to external consultants, subcontractors , facility
expenses, travel expenses, communication expenses, bad debts and advances written off, allowance for expected credit losses and doubtful advances (net) and other expenses. Other
expenses are aggregation of costs which are individually not material such as, recruitment and training, misc. expenses, etc.
i) Terms of repayment and securities of secured loans
Term Loan - I (in Foreign Currency FCNR) from HDFC Bank Limited amounting to Rs. 41,434.51 thousands (Previous year: Rs. 69,532.36 thousands) is disclosed under long-term
borrowings. The FCNR loan of USD 17,08,802 was availed towards reimbursement ofthe acquisition cost ofthe building incurred by the Company. The loan is repayable in 60 equal
monthly installments commencing from September 2022 and is secured by a first and exclusive charge on the corporate office building. It carries an interest rate of 2.50% p.a. plus
SOFR. As of the balance sheet date, the Company has repaid 29 out of the 60 installments.
Subsequent Events: Two monthly installments that were due on 11th February 2025 and 11th March 2025 were paid in the month of May 2025.
Term loan - II in Foreign currency FCNR from HDFC Bank Limited amounting to Rs.9,434.24 (Previous year: Rs. 15,796.22 thousands) disclosed under long-term borrowings. The loan in
FCNR $.3,56,664 was availed against reimbursement of the Interior cost of the Building incurred by the company and the loan will be repayable in 55 equal installments commencing
from February 2023. The loan is secured by Corporate Office Building as first and exclusive charge. The loan carries interest rate of 2.50% SOFR p.a. The company has repaid 24
installments out of 55 installments as on the balance sheet date.
Term loan - III in Foreign currency FCNR from HDFC Bank Limited amounting to Rs.1,21,087.35 (Previous year: Rs. 2,01,278.75 thousands) disclosed under long-term borrowings. The
loan in FCNR $.36,62,106.80 was availed for acquisition of Foreign Subsidiary by the company and the loan will be repayable in 48 equal installments commencing from January 2024.
The loan carries interest rate of 3.00% SOFR p.a. The company has repaid 13 installments out of 44 installments as on the balance sheet date.
i) Cash Credit / Working Capital Demand Loans from Banks
The Cash Credit / Working Capital Demand Loan (WCDL) facilities are secured by way of hypothecation of current assets including receivables and are further secured by a pari-passu
charge on the movable fixed assets of the Company. The facilities are repayable on demand and are generally renewed annually.
As at 31st March 2025, the outstanding balance in Cash Credit account with HDFC Bank amounting to Rs.3,227.11 thousands (Previous year: Rs. Nil thousands)
Working Capital Demand loans from HDFC Bank amounting to Rs.97,534.22 thousands equivalent USD 11,39,684.71 (Previous year: Rs.2,16,838.03 thousands equivalent USD
26,00,911.91 )
ii) Terms of working capital loan from bank, terms of interest and nature of security:
Current maturities of Long term debt in FCNR for Term Loan I amounting to Rs. 34,122.99 thousands equivalent USD 3,98,726.26 (Previous year: Rs. 28,492.56 thousands equivalent
USD 3,41,760.36 ) disclosed under current borrowings.
Current maturities of Long term debt in FCNR for Term Loan II amounting to Rs.7,769.63 thousands equivalent USD 90,787.90 (Previous year: Rs. 6,487.66 thousands equivalent USD
77,817.60 ) disclosed under current borrowings.
Current maturities of Long term debt in FCNR for Term Loan III amounting to Rs. 99,719.17 thousands equivalent USD 11,65,215.80 (Previous year: Rs.83,266.32 thousands equivalent
USD 9,98,756.40 ) disclosed under current borrowings.
The above figures are restated as at 31st March 2025 @ closing rate of I USD in INR 85.58
iii) 'Loan from related party:
Software services
CTEL offers a full suite of digital transformation services, including:
Artificial Intelligence Solutions: Tailored AI services from strategic planning to implementation (AIaaS), including integration with existing client platforms. Big Data Consulting: EDW strategy
design, analytics, dashboards, scorecarding, KPI/metric management using advanced big data and cloud technologies. Cloud Services: Cloud migration, SaaS application development, disaster
recovery planning, monitoring, backup, and cloud TCO assessments. Application Services: End-to-end development, migration, testing, and mobility solutions across modern platforms. DevOps:
Advisory, implementation, and support to accelerate release cycles and improve agility. IAM (Identity and Access Management): Strategy, implementation, and managed services using platforms
like Oracle and ForgeRock etc. Infrastructure Management: Unified management of cloud, middleware, OS, and enterprise IT infrastructure.
Sale of Licenses
The Companyearns revenue fromthe sale of software licenses aspartofitschannelpartnership arrangements with leadingtechnology providers Oracle etc. also selling Atlassian Dashboard Hub
Pro -Charts, Reports, Time in Status, Tables Data Center for Jira Software . Under these arrangements, the Company facilitating the resale of software products and licenses to end customers
across various industry segments.
Trade receivables and contract balances
The company classifies the right to consideration in exchange for deliverables as receivable. A receivable is a right to consideration that is unconditional upon passage of time.
Revenue for fixed price development contracts contracts are recognized as related service are performed. Revenue for fixed price maintenance contracts is recognized on the basis of time
elapsed.
Revenue recognition for fixed price development contracts is based on percentage of completion method. Invoicing to the clients is based on milestones as defined in the contract. This would
result in the timing of revenue recognition being different from the timing of billing the customers.
Revenue recognition for fixed price maintenance contracts is based on utilisation of man power in a particular project duringthe period,which will be according to master serviceagreement or
purchase order or statement of work of respective projects.
In respect of other fixed-price contracts, revenue is recognised using percentage-of-completion method ('POC method') of accounting with contract costs incurred determining the degree of
completion of the performance obligation
Revenue related to fixed price maintenance and support services contracts where the Company is standing ready to provide services is recognised based on time elapsed mode and revenue is
straight-lined over the period of performance.
Revenue recognition for cost plus contracts is based on cost incurred towards a particular project during the period by adding the profit margin, according to master service agreement or
purchase order or statement of work of respective projects.
Trade receivable are presented net of impairment in the Balance Sheet.
Revenue from subsidiaries is recognised based on transaction price which is at arm's length.
Contract assets are recognised when there are excess of revenues earned over billings on contracts. Contract assets are classified as unbilled receivables (only act of invoicing is pending) when
there is unconditional right to receive cash, and only passage of time is required, as per contractual terms.
Unearned and deferred revenue ("contract liability") is recognised when there are billings in excess of revenues. The billing schedules agreed with customers include periodic performance based
payments and / or milestone based progress payments. Invoices are payable within contractually agreed credit period.
Income from Software Products/ Licenses
Revenue fromthe sale of user licenses for software applications is recognized upon the transfer of title in the user license, except in the case of multiple-element contracts requiring significant
implementation services, where revenue is recognized as per the percentage of completion method.
Performance obligations and remaining performance obligations
The remaining performance obligation disclosure provides the aggregate amount ofthe transaction price yet to be recognized as at theend ofthe reportingperiod andan explanation astowhen
the Company expects to recognize these amounts in revenue. Applying the practical expedient as given in Ind AS 115, the Company has not disclosed the remaining performance obligation
related disclosures forcontracts where the revenue recognized correspondsdirectlywith thevaluetothecustomerofthe entity's performance completed to date, typicallythose contractswhere
invoicing is on fixed price maintenance contract basis and in cases where the performance obligation is part of a contract that has an original expected duration of one year or less. Remaining
performance obligation estimates are subject to change and are affected by several factors, including terminations, changes in the scope of contracts, periodic revalidations, adjustment for
revenue that has not materialized and adjustments for currency.
34. Employee benefits
Short term employee benefits
All employee benefits payable wholly within twelve months of rendering the service are classified as short-term employee benefits. Benefits such as salaries, wages etc. and the
expected cost of ex-gratia are recognised in the period in which the employee renders the related service. A liability is recognised for the amount expected to be paid when there
is a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.
(i) Compensated absences
The leave obligation covers the Company's liability for earned leave which is unfunded. The company recognizes liabilities for compensated absences, such as earned leave, using
the Projected Unit Credit Method. Actuarial valuations are conducted at each balance sheet date to ensure the liabilities accurately reflect the company's obligations for accrued
leave.
(ii) Defined contribution plans
The Company has a defined contribution plan, namely the Provident Fund. Contributions are made to the Provident Fund at the rate of 12% of basic salary as per regulations.
These contributions are made to a registered Provident Fund administered by the Government. The Company's obligation is limited to the amount contributed, and it has no
further contractual or constructive obligations. The contributions made to the fund are recognised as an expense in profit and loss under employee benefit expenses.
The above sensitivity analysis is based on a change in each assumption while holding all other assumptions constant. In practice, this is unlikely to occur and changes in some of
the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions, the same method (present value of the
defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability
recognised in the balance sheet.
iv) Risk exposure
Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below:
Interest rate risk:
The defined benefit obligation calculated uses a discount rate based on government bonds. If bond yields fall, the defined benefit obligation will tend to increase.
Salary inflation risk:
Higher than expected increases in salary will increase the defined benefit obligation.
Demographic risk:
This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability and retirement. The effect of these decrements on
the defined benefit obligation is not straight forward and depends upon the combination of salary increase, discount rate and vesting criteria. It is important not to overstate
withdrawals because in the financial analysis the retirement benefit of a short career employee typically costs less per year as compared to a long service employee.
Note on “Code on Security, 2020"
The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributions by the company towards Provident Fund and Gratuity. The Ministry
of Labour and Employment has released draft rules for the Code on Social Security, 2020 on November 13, 2020, and has invited suggestions from stakeholders which are under
active consideration by the Ministry. The Company will assess the impact and its evaluation once the subject rules are notified and will give appropriate impact in its financial
statements in the period in which, the Code becomes effective and the related rules to determine the financial impact are published
35. Financial instruments and risk management
Fair values
a) The fair value of financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other
than in a forced or liquidation sale.
b) The fair value of trade receivables, trade payables, and other current financial assets and liabilities is considered to be equal to their carrying amounts due to their short-term
nature. All such items have been classified under Level 2 of the fair value hierarchy. In cases where items are non-current in nature, their fair value has also been determined
using observable inputs, such as the discounted cash flow method, and accordingly classified as Level 2. Similarly, for unquoted equity instruments where recent information is
insufficient or where a wide range of fair value estimates exists, cost has been considered the best estimate of fair value and classified under Level 2.
c) The fair value of forward foreign exchange contracts is calculated as the present value determined using forward exchange rates, currency basis spreads between the
respective currencies and interest rate curves.
Set out below, is a comparision by class of the carrying amounts and fair value of the Company's financial instruments, other than those with carrying amounts that are
reasonable approximation of fair values:
* Fa ir value of instruments is classified in various fair value hierarchies based on the following three levels:
Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices.
Level 2 - Inputs are other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from
prices).
Level 3 - Inputs are not based on observable market data (unobservable inputs). Fair values are determined in whole or in part using a valuation model based on assumptions
that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data. The cost of unquoted
investments included in Level 3 of fair value hierarchy approximate their fair value because there is a wide range of possible fair value measurements and the cost represents
estimate of fair value within that range.
Management exercises its best judgment in estimating the fair value of financial instruments. However, all estimation techniques have inherent limitations. Accordingly, the fair
value estimates presented are not necessarily indicative of the amounts that the Company could realize or pay in actual markettransactions as of the respective reporting dates.
The fair value of financial instruments may also vary subsequent to the reporting date due to changes in market conditions or other factors.
36. Financial risk management
The Company is exposed to market risk (fluctuation in foreign currency exchange rates, price and interest rate), liquidity risk and credit risk, which may adversely impact the fair
value of its financial instruments. The Company assesses the unpredictability of the financial environment and seeks to mitigate potential adverse effects on the financial
performance of the Company.
(A) Market risk
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Such changes in the values of financial
instruments may result from changes in the foreign currency exchange rates, interest rates, credit, liquidity and other market changes.The Company's exposure to market risk is
primarily on account of foreign currency exchange rate risk.
The analysis exclude the impact of movements in market variables on the carrying values of financial assets and liabilities .
The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held
at 31 March, 2025 and 31 March, 2024.
(i) Foreign currency exchange rate risk
The fluctuation in foreign currency exchange rates may have potential impact on the statement of profit and loss and other comprehensive income and equity, where any
transaction references more than one currency or where assets / liabilities are denominated in a currency other than the functional currency of the Company. Considering the
countries and economic environment in which the Company operates, its operations are subject to risks arising from fluctuations in exchange rates in those countries. The
Company's exposure to the risk of changes in foreign exchange rates relates primarily to the trade/other payables, trade/other receivables. The risks primarily relate to
fluctuations in US Dollars against the functional currencies of the Company. The Company's exposure to foreign currency changes for all other currencies is not material. The
Company evaluates the impact of foreign exchange rate fluctuations by assessing its exposure to exchange rate risks.
The foreign exchange rate sensitivity is calculated by aggregation of the net foreign exchange rate exposure and a simultaneous parallel foreign exchange rates shift of the
currencies by 1% against the functional currency of the Company .
The following analysis has been worked out based on the net exposures of the Company as of the date of balance sheet which could affect the statement of profit and loss and
other comprehensive income and equity .
The assumed increase/decrease in interest rate for sensitivity analysis is based on the currently observable market environment
(B) Credit Risk
Financial assets of the Company include trade receivables, loans to wholly owned subsidiaries, employee advances, security deposits held with government authorities and
others and bank deposits which represents Company's maximum exposure to the credit risk.
With respect to credit exposure from customers, the Company has a procedure in place aiming to minimise collection losses. Credit Control team assesses the credit quality of
the customers, their financial position, past experience in payments and other relevant factors.
The carrying amount of trade receivables, loans, advances, deposits, cash and bank balances, bankdeposits and interest receivable on deposits represents company's maximum
exposure to the credit risk. No other financial asset carry a significant exposure with respect to the credit risk. Bank deposits and cash balances are placed with reputable banks
and deposits are with reputable government, public bodies and others. The Company's exposure to credit risk is influenced mainly by the individual characteristics of each
customer. However, management also considers the factors that may influence the credit risk of its customer base, including default risk associate with the industry and country
in which customers operate. Credit quality of a customer is assessed based on an extensive credit rating scorecard and individual credit limits are defined in accordance with this
assessment. With respect to other financial assets viz., loans & advances, deposits with government and banks, the credit risk is insignificant since the loans & advances are
given to its wholly owned subsidiary and employees only and deposits are held with government bodies and reputable banks. The credit quality of the financial assets is
satisfactory, taking into account the allowance for credit losses.
Credit risk on trade receivables and other financial assets is evaluated as follows:
38. Contingent liabilities
The Company has the following contingent liabilities as at:
Contingencies
Direct tax matters
The Company has ongoing disputes with income tax authorities in India .The disputes relate to taxtreatment of certain expenses claimed as deduction, computation or and allowances and characterisation of
expenses and transfer pricing issues. Contingent liability in respect of tax demands received from direct tax authorities in India and other jurisdictions is 8.07 crore and 8.07 crore as at 31 March 2025 and 31
March 2024, respectively. These demand orders are being contested by the Company based on the management evaluation and advise of tax consultants.The Company periodically receives notices and
inquiries from income tax authorities related to the Company's operations in the jurisdictions it operates in. The Company has evaluated these notices and inquiries and has concluded that any consequent
income tax claims or demands by the income tax authorities will not succeed on ultimate resolution.
Indirect taxes
The Company has ongoing disputes with tax authorities primarily relating to the characterisation and classification of certain items. The company has demands amounting to Rs. 3.26 crore as at March 31,
2025 and Rs. 3.26 crore as at March 31, 2024 have been raised by various indirect tax authorities. These are being contested by the Company based on management's evaluation and the advice of tax
consultants.
During the year, the Company received a GST demand of Rs. 0.14 crore relating to a mismatch of Input Tax Credit (ITC) claimed between GSTR-3B and GSTR-2A for the financial year 2017-18. An appeal has
been filed before the Appellate Authority against the said demand.
47. Corporate Social Responsibility (CSR)
Section 135 of the Companies Act 2013 and the Rules made thereunder prescribe that every company having a net worth of Rs 500 crore or
more, or turnover of Rs 1,000 crore or more or a net profit of Rs 5 crore or more during any financial year shall ensure that the Company
spends in every financial year, at least 2% of the average net profits made during the three immediately preceding financial years, in
pursuance of its Corporate Social Responsibility (CSR) policy. As the conditions are not satisfied, the provisions pertaining to CSR as prescribed
under the Companies Act 2013 are not applicable to the Company for the year ended 31 March 2025.
48. Additional Regulatory Information
The Company does not have any Benami property and does not have any proceeding initiated or pending against the company for holding
any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.
There are no immovable properties whose title deeds are not held in the name of the Company.
The Company has certain charges/satisfaction filings pending in respect of facilities from CITI Bank and Kotak Bank, which are yet to be
registered with the Registrar of Companies. These filings are pending beyond the statutory period.
The company had obtained borrowings from banks on the basis of security of Current assets which includes book debts.
The company does not have any transactions with companies struck off under section 248 of the Companies Act 2013 or section 560 of
Companies Act, 1956.
The Company has not traded or invested in crypto currency or virtual currency during the financial year.
The Company has not advanced or loaned or invested funds to any other person or entity, 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 Company
(Ultimate Beneficiaries) or
(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
The Company has not received any fund from any person or entity, including foreign entities (Funding Party) with the understanding (whether
recorded in writing or otherwise) that the Company 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.
The Company does not have any such transaction which is not recorded in the books of accounts but 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 provisions of
the Income Tax Act, 1961).
49. Figures of the previous period have been regrouped/reclassified / rearranged wherever necessary.
As per our report of even date
For B R A N D & Associates LLP For and on behalf of the Board
Chartered Accountants
Firm Registration Number: 012344S/S200101
Kumaraswami Reddy A D.R.R Swaroop Lalpet Sridhar
Partner Wholetime Director Director
Membership Number: 220366 DIN: 00453250 DIN: 02539952
UDIN: 25220366BMICWE6360
Place: Hyderabad Purnayya Puppala Ashish Bhattad
Date: 29 May 2025 Chief Financial Officer Company Secretary
M.No. A34781
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