3.13 Provisions and contingencies
Provisions
Provisions are recognised when the Company has a present obligation (legal or constructive) as
a result of a past event, it is probable that an outflow of resources embodying economic benefits
will be required to settle the obligation and a reliable estimate can be made of the amount of the
obligation. Provisions are not recognised for future operating losses.
Provisions are measured at the present value of management's best estimate of the expenditure
required to settle the present obligation at the end of the reporting period. The discount rate
used to determine the present value is a pre-tax rate that reflects current market assessments
of the time value of money and the risks specific to the liability. The increase in the provision due
to the passage of time is recognised as interest expense.
Contingencies
Contingent liabilities are 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 or 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. Information on
contingent liability is disclosed in the Notes to the Financial Statements. Contingent assets are
not recognised. However, when the realisation of income is virtually certain, then the related
asset is no longer a contingent asset, but it is recognised as an asset.
3.14 Investment in Subsidiaries
A subsidiary is an entity controlled by the Company. Control exists when the Company has
power over the entity, is exposed, or has rights to variable returns from its involvement with the
entity and has the ability to affect those returns by using its power over entity.
Power is demonstrated through existing rights that give the ability to direct relevant activities,
those which significantly affect the entity's returns.
Investments in subsidiaries are carried at cost. The cost comprises price paid to acquire
investment and directly attributable cost.
3.15 Current versus non-current classification
The Company presents assets and liabilities in statement of financial position based on current/
non-current classification.
The Company has presented non-current assets and current assets before equity, non-current
liabilities and current liabilities in accordance with Schedule III, Division II of Companies Act,
2013 notified by MCA.
An asset is classified as current when it is:
a) Expected to be realised or intended to be sold or consumed in normal operating cycle,
b) Held primarily for the purpose of trading,
c) Expected to be realised within twelve months after the reporting period, or
d) Cash or cash equivalent unless restricted from being exchanged or used to settle a liability
for at least twelve months after the reporting period.
All other assets are classified as non-current.
A liability is classified as current when:
a) It is expected to be settled in normal operating cycle,
b) It is held primarily for the purpose of trading,
c) It is due to be settled within twelve months after the reporting period, or
d) There is no unconditional right to defer the settlement of the liability for at least twelve
months after the reporting period.
All other liabilities are classified as non-current.
The operating cycle is the time between the acquisition of assets for processing and their
realisation in cash or cash equivalents.
Deferred tax assets and liabilities are classified as non-current assets and liabilities.
3.16 Compound financial instruments
The liability component of a compound financial instrument is recognised initially at fair value of
a similar liability that does not have an equity component. The equity component is recognised
initially as the difference between the fair value of the compound financial instrument as a
whole and the fair value of the liability component. Any directly attributable transaction costs
are allocated to the liability and the equity components, if material, in proportion to their initial
carrying amounts.
Subsequent to the initial recognition, the liability component of a compound financial instrument
is measured at amortised cost using the effective interest rate method. The equity component
of a compound financial instrument is not re-measured subsequent to initial recognition except
on conversion or expiry.
3.17 Leases
As per Ind AS 116, leases, the arrangement is, or contains, a lease if fulfilment of the arrangement
is dependent on the use of a specific asset or assets and the arrangement conveys a right to
use the asset or assets for a period of time in exchange for consideration, even if that right is
not explicitly specified in an arrangement.
Lease accounting by lessee
Company as lessee will measure the right-of-use asset at cost by recognition a right-of-use
asset and a lease liability on initial measurement of the right-of-use asset at the commencement
date of the lease.
The cost of the right-of-use asset will comprise:
- the amount of the initial measurement of the lease liability,
- any lease payments made at or before the commencement date less any incentives
received,
- any initial direct costs incurred
- an estimate of costs to be incurred in dismantling and removing the underlying asset,
restoring the site on which it is located or restoring the underlying asset to the condition
required by the terms and conditions of the lease, unless those costs are incurred to
produce inventories.
Lease liability will be initially measured at the present value of the lease payments that are not
paid at that date. The lease payments are discounted using the interest rate implicit in the lease,
if the rate cannot be readily determined incremental borrowing rate will be considered. Interest
on lease liability in each period during the lease will be the amount that produces a constant
periodic rate of interest on the remaining balance of the lease liability.
Lease payments will comprise the following payments for the right to use the underlying asset
during the lease term that are not paid at the commencement date:
- fixed payments less any lease incentives receivable
- variable lease payments
- amounts expected to be payable under residual value guarantees
- the exercise price of a purchase option, if the Company is reasonably certain to exercise
that option
- payments of penalties for terminating the lease, if the lease term reflects the Company
exercising an option to terminate the lease.
Subsequent measurement of the right-of-use asset after the commencement date will be at
cost model, the value of right-of-use asset will be initially measured cost less accumulated
depreciation and any accumulated impairment loss and adjustment for any re-measurement of
the lease liability.
The right-of-use asset will be depreciated from the commencement date to the earlier of the
end of the useful life of the asset or the end of lease term, unless lease transfers ownership of
the underlying asset to the Company by the end of the lease term or if the cost of the right-of-
asset reflects that the Company will exercise a purchase option, in such case the Company will
depreciate asset to the end of the useful life.
Subsequent measurement of the lease liability after the commencement date will reflect the
initially measured liability increased by interest on lease liability, reduced by lease payments and
re-measuring the carrying amount to reflect any re-assessment or lease modification.
Right-of-use asset and lease liability are presented on the face of balance sheet. Depreciation
charge on right-to-use is presented under depreciation expense as a separate line item. Interest
charge on lease liability is presented under finance cost as a separate line item. Under the cash
flow statement, cash flow from lease payments including interest are presented under financing
activities. Short-term lease payments, payments for leases of low-value assets and variable
lease payments that are not included in the measurement of the lease liabilities are presented
as cash flows from operating activities.
The Company has elected to adopt the practical expedient not to account for short term leases
or leases for which the underlying asset is of low value, as right-of-use assets. Company will
recognise these lease payments associated with those leases as an expense on either a
straight-line basis over the lease term or another systematic basis.
Lease accounting by lessor
Company as a lessor need to classify each of its leases either as an operating lease or a finance
lease. A lease is classified as a finance lease if it transfers substantially all the risks and rewards
incidental to ownership of an underlying asset. A lease is classified as an operating lease if it
does not transfer substantially all the risks and rewards incidental to ownership of an underlying
asset.
Finance lease
At the commencement date, will recognise assets held under a finance lease in its balance
sheet and present them as a receivable at an amount equal to the net investment in the lease.
Net investment is the discount value of lease receipts net of initial direct costs using the interest
rate implicit in the lease. For subsequent measurement of finance leased assets, the Company
will recognise interest income over the lease period, based on a pattern reflecting a constant
periodic rate of return on the Company's net investment in the lease.
Operating lease
Company will recognise lease receipts from operating leases as income on either a straight¬
line basis or another systematic basis. Company will recognise costs, including depreciation
incurred in earning the lease income as expense.
3.18 New and amended standards notified by the Ministry of Corporate Affairs
The Ministry of Corporate Affairs vide notification dated May 7, 2025 and August 13, 2025 notified
the Companies (Indian Accounting Standards) Amendment Rules, 2025 and Companies (Indian
Accounting Standards) Second Amendment Rules, 2025, respectively, which amended certain
accounting standards (see below), and are effective for annual reporting periods beginning on
or after April 1,2025:
(a) Classification of Liabilities as Current or Non-current and Non-current Liabilities
with Covenants -
Amendments to Ind AS 1 As a result of the adoption of the amendments to Ind AS 1, the
Company changed its accounting policy for the classification of borrowings: “Borrowings
are classified as current liabilities unless, at the end of the reporting period, the Company
has a right to defer settlement of the liability for at least 12 months after the reporting
period. Covenants that the Company is required to comply with, on or before the end
of the reporting period, are considered in classifying loan arrangements with covenants
as current or non-current. Covenants that the Company is required to comply with after
the reporting period do not affect the classification.” This new policy did not result in a
change in the classification of the Company's borrowings. The Company did not make
retrospective adjustments as a result of adopting the amendments to Ind AS 1.
(b) Supplier Finance Arrangements - Amendments to Ind AS 7 and Ind AS 107
As a result of the adoption of the amendments to Ind AS 7 and Ind AS 107, the Company
provided new disclosures for liabilities under supplier finance arrangements in note 28.
(c) International Tax Reform - Pillar Two Model Rules - Amendments to Ind AS 12
The Company is not within the scope of the OECD Pillar Two Model Rules, as Pillar Two
legislation has not yet been enacted in any of the jurisdictions in which the Company
operates. 143 Notes to Standalone Financial Statements (d) Lack of Exchangeability -
Amendments to Ind AS 21 The amended Ind AS 21 have added requirements to help
entities to determine whether a currency is exchangeable into another currency, and the
spot exchange rate to use where it is not. These amendments did not have any material
impact on the amounts recognised in prior periods and are not expected to significantly
affect the current or future periods.
New standards or amendments not yet adopted Classification of Liabilities as Current or
Non-current and Non-current Liabilities with Covenants -
Amendments to Ind AS 1 - This amendment also includes specific provisions that will take effect
for reporting periods beginning on or after April 1, 2026, as outlined below. Under the existing
Ind AS 1, where there is a breach of a material provision of a long-term loan arrangement
on or before the end of the reporting period with the effect that the liability becomes payable
on demand on the reporting date, the entity does not classify the liability as current, if the
lender agreed, after the reporting period and before the approval of the financial statements
for issue, not to demand payment as a consequence of the breach. However, the amended
requirements stipulate that entities will no longer be permitted to consider lender waivers that
are granted after the reporting date but before the financial statements are approved for the
purpose of classification of loans. This amendment is required to be applied retrospectively in
accordance with Ind AS 8. The Company does not expect this amendment to have an impact on
its operations or financial statements
4. Critical accounting estimates, assumptions, and judgements
In the process of applying the Company's accounting policies, management has made the
following estimates, assumptions and judgements, which have significant effect on the amounts
recognised in the financial statement:
(a) Property, plant and equipment
External adviser or internal technical team assess the remaining useful lives and residual
value of property, plant and equipment. Management believes that the assigned useful
lives and residual value are reasonable, the estimates and assumptions made to determine
depreciation are critical to the Company's financial position and performance.
(b) Intangibles
Internal technical or user team assess the remaining useful lives of Intangible assets.
Management believes that assigned useful lives are reasonable.
(c) Income taxes
Management judgment is required for the calculation of provision for income taxes and
deferred tax assets and liabilities. The Company reviews at each balance sheet date the
carrying amount of deferred tax assets. The factors used in estimates may differ from
actual outcome which could lead to significant adjustment to the amounts reported in the
standalone financial statements.
(d) Contingencies
Management judgement is required for estimating the possible outflow of resources, if any,
in respect of contingencies/claim/litigations against the Company as it is not possible to
predict the outcome of pending matters with accuracy.
5. Financial risk management
Financial risk factors
The Company's principal financial liabilities, comprise borrowings, trade and other payables. The
main purpose of these financial liabilities is to manage finances for the Company's operations.
The Company has trade and other receivables, and cash and bank balances that arise directly
from its operations. The Company's activities expose it to a variety of financial risks:
i) 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. Market prices comprise three types
of risk: currency rate risk, interest rate risk and other price risks, such as equity price
risk and commodity risk. Financial instruments affected by market risk include loans and
borrowings, deposits, investments, and derivative financial instruments. Foreign currency
risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in foreign exchange rates. Interest rate risk is the risk that the fair
value or future cash flows of a financial instrument will fluctuate because of changes in
market interest rates. This is based on the financial assets and financial liabilities held as
of March 31,2026 and March 31, 2025.
ii) Credit risk
Credit risk is the risk that a counter party will not meet its obligations under a financial
instrument or customer contract, leading to a financial loss.
iii) Liquidity risk.
Liquidity risk is the risk that the Company may not be able to meet its present and future
cash and collateral obligations without incurring unacceptable losses.
Risk management is carried out by the treasury department under policies approved by
the board of directors. The treasury team identifies, evaluates and hedges financial risks
in close co-operation with the Company's operating units. The board provides principles
for overall risk management, as well as policies covering specific areas, such as foreign
exchange risk, interest rate risk, and credit risk, use of derivative financial instruments and
non-derivative financial instruments, and investment of excess liquidity.
Market Risk
The sensitivity analysis excludes the impact of movements in market variables on the carrying
value of post-employment benefit obligations provisions and on the non-financial assets and
liabilities. The sensitivity of the relevant Statement of Profit and Loss item is the effect of the
assumed changes in the respective market risks. The Company's activities expose it to a variety
of financial risks, including the effects of changes in foreign currency exchange rates and
interest rates.
(a) Foreign exchange risk and sensitivity
The Company has no foreign currency trade payables and receivable outstanding as on
31st March, 2026 and is therefore, not exposed to foreign exchange risk.
(b) Interest rate risk and sensitivity
The Company's exposure to the risk of changes in market interest rates relates primarily
to long term debt.
Liquidity risk
The Company's objective is to; at all times maintain optimum levels of liquidity to meet its cash
and collateral requirements. In case of temporary short fall in liquidity to repay the borrowing/
operational short fall , the company uses mix of capital infusion and borrowing from its group
company. However, the company envisage that such short fall is temporary and the company
would generate sufficient cash flows as per approved projections.
Capital risk management
The Company manages its capital structure and makes adjustments in light of changes in
economic conditions and the requirements of the financial covenants. To maintain or adjust
the capital structure, the Company may adjust the dividend payment to shareholders, return
capital to shareholders or issue new shares. The primary objective of the Company's capital
management is to maximize the shareholder value. The Company's primary objective when
managing capital is to ensure that it maintains an efficient capital structure and healthy capital
ratios and safeguard the Company's ability to continue as a going concern in order to support
its business and provide maximum returns for shareholders. The Company also proposes to
maintain an optimal capital structure to reduce the cost of capital. No changes were made in the
objectives, policies or processes during the year ended March 31,2026 and March 31, 2025.
For the purpose of the Company's capital management, capital includes issued capital, share
premium and all other equity reserves. Net debt includes, interest bearing loans and borrowings,
trade and other payables less cash and short term deposits, excluding discontinued operations.
The Company monitors capital using a gearing ratio, which is net debt divided by total capital.
Net debt is calculated as loans and borrowings less cash and cash equivalents.
Fair Valuation techniques
The Company maintains policies and procedures to value financial assets or financial liabilities
using the best and most relevant data available. The fair values of the financial assets and
liabilities are included at the amount that would be received to sell an asset or paid to transfer a
liability in an orderly transaction between market participants at the measurement date.
The following methods and assumptions were used to estimate the fair values:
1) Fair value of cash and other current financial assets and liabilities approximate their
carrying amounts largely due to the short-term maturities of these instruments.
2) Long-term fixed-rate borrowings are evaluated by the Company based on parameters
such as interest rates, specific country risk factors, credit risk and other risk characteristics.
Fair value of variable interest rate borrowings is not material different from carrying values.
For fixed interest rate borrowing fair value is determined by using the discounted cash flow
(DCF) method using discount rate that reflects the issuer's borrowings rate. Risk of non¬
performance for the company is considered to be insignificant in valuation.
Fair Valuation of Financial Guarantees:
Financial guarantees issued by the Company on behalf of its subsidiary companies have been
measured through profit and loss account. Fair value of said guarantees as at March 31, 2026
is considered Rs. Nil (March 31,2025- Nil) based on valuation carried by independent valuer.
Fair Value hierarchy
The following table provides the fair value measurement hierarchy of Company's asset and
liabilities, grouped into Level 1 to Level 3 as described below:
• Quoted prices / published NAV (unadjusted) in active markets for identical assets or
liabilities (level 1). It includes fair value of financial instruments traded in active markets
and are based on quoted market prices at the balance sheet date and financial instruments
like mutual funds for which net assets value( NAV) is published mutual fund operators at
the balance sheet date.
• Inputs other than quoted prices included within level 1 that are observable for the asset
or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (level
2). It includes fair value of the financial instruments that are not traded in an active market
(for example, over-the-counter derivatives) is determined by using valuation techniques.
are yet to be notified. The Company has estimated and recorded past service cost based on the
best available information and review of the existing wage structure. The Company continues
to monitor the finalisation of Central/State Rules and clarifications from the Government of India
on several aspects of the New Labour Codes and would provide appropriate accounting effect
based on such developments and consequent management decisions in this regard
OCI presentation of defined benefit plan
-Gratuity is in the nature of defined benefit plan, Re-measurement gains/(losses) on defined
benefit plans is shown under OCI as Items that will not be reclassified to profit or loss and also
the income tax effect on the same.
-Leave encashment cost is in the nature of short term employee benefits.
Presentation in Statement of Profit and Loss and Balance Sheet
Expense for service cost, net interest on net defined benefit liability (asset) is charged to
Statement of Profit and Loss.
IND AS 19 do not require segregation of provision in current and non-current, however net
defined liability (Assets) is shown as current and non-current provision in balance sheet as per
IND AS 1.
Actuarial liability for short term benefits (leave encashment cost) is shown as current and non¬
current provision in balance sheet.
When there is surplus in defined benefit plan, company is required to measure the net defined
benefit asset at the lower of; the surplus in the defined benefit plan and the assets ceiling,
determined using the discount rate specified, i.e. market yield at the end of the reporting period
on government bonds, this is applicable for domestic companies, foreign company can use
corporate bonds rate.
The Company assesses these assumptions with its projected long-term plans of growth and
prevalent industry standards. The mortality rates used are as published by one of the leading
life insurance companies in India.
11. Related party transactions
In accordance with the requirements of IND AS 24, on related party disclosures, name of
the related party, related party relationship, transactions and outstanding balances including
commitments where control exits and with whom transactions have taken place during reported
periods, are:
Formulae for computation of ratios are as follows :
(a) Current Ratio : Current assets / Current liabilities
(b) Debt Equity Ratio : Total Debt/ Net Worth
Total Debt : Secured Loans Unsecured Loans - Liquid Investments
Net Worth : Equity Share Capital Reserves (Excluding Revaluation Reserve)
(c) Debt Service Coverage Ratio : EBDIT / (Finance costs Principal repayment of long term
debt during the period)
(d) Return on Equity Ratio = Net Income/Shareholder's equity
Net Income : Profit after tax
Shareholder's equity : Equity Share Capital Reserves (Excluding Revaluation Reserve)
(e) Inventory turnover ratio : (Cost of material consumed Purchase of stock-in-trade
Changes in inventories )/ (average of opening and closing inventory of RM, SFG, FG and
Scrap)
(f) Trade Receivables turnover ratio = Net Credit Sales / (Average of opening and closing
trade receivable for the period)
(g) Trade payables turnover ratio : (Cost of material consumed Purchase of stock-in-trade
Changes in inventories ) / (Average of opening and closing trade payable for the year)
(h) Net capital turnover ratio : Total Turnover / Shareholder's equity
Shareholder's equity : Equity Share Capital Reserves (Excluding Revaluation Reserve)
(i) Net Profit ratio : Net Profit/Total income
(j) Return on Capital employed: EBIT/ Capital employed
EBIT : (Profit before tax finance cost)
Capital employed : (Total Assets - Current Liability)
15. Segment information
The business activity of the Company falls within a single primary business segment viz
‘Management Support Services' and hence there is no other reportable segment as per Ind AS
108 ‘Operating Segments'.
(a) Revenue from operations- Domestic Rs 351.36 lacs (PY Rs 364.46 lacs)
Exports Rs Nil (PY Rs Nil)
(b) Non-Current Assets
All non-current assets of the company are located in India.
(c) Revenue from two major customers (previous year three) which is more than 10% of the
company's total revenue.
The number of shares used in computing basic EPS is the weighted average number of shares
outstanding during the year
17. During the previous year, the company has transferred Rs 1.09 lakhs (Sale proceed from
fractional shares) to Investor education and protection fund on completion of 7 years.
18. Additional Regulatory Information:
(i) Title deeds of Immovable Property not held in name of the Company
The said provision is not applicable during the year.
(ii) The company does not hold any Property, Plant and Equipment, hence provisions w.r.t
disclosure of revaluation of Company's Property, Plant and Equipment as defined under
rule 2 of the Companies (Registered Valuers and Valuation) Rules, 2017 provision is not
applicable.
(iii) Loans or Advances
The company has not granted any loan to promoters, directors, KMPs and the related
parties (as defined under Companies Act, 2013), either severally or jointly with any other
person.
(iv) Company is not declared wilful defaulter by any bank or financial Institution or other lender.
(v) The company does not have any transaction with companies which are struck off except
the following:
(vi) The company do not have any secured borrowings on which charge with Registrar of
Companies is to be created.
(vii) The provisions related to number of layers prescribed under clause (87) of section 2 of the
Act read with Companies (Restriction on number of Layers) Rules, 2017 are not applicable
on the company.
(viii) There is no Scheme of Arrangements has been approved by the Competent Authority in
terms of sections 230 to 237 of the Companies Act, 2013.
(ix) Utilisation of Borrowed funds and share premium:
The company has not advanced/ loaned/ invested funds (borrowed/share premium/any
other sources of kind of funds) to any other person(s) or entity(ies), including foreign
entities (intermediaries), with the understanding (whether recorded in writing or otherwise)
that the intermediary shall (a) directly/ indirectly lend or invest in other persons or entities
identified in any manner 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.
(x) Undisclosed income
No income has been surrended or disclosed for which transaction was 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 provisions of the Income Tax Act, 1961).
(xi) There is no transaction related to Crypto Currency or Virtual Currency. Hence, Not
applicable.
19. Compliance with audit trail for accounting software
The Company is using an ERP which is widely used internationally. The ERP software is having
an audit trail feature for maintaining its books of account. The Company enabled audit trail in all
the tables throughout the year except that as per the ERP provider, though system administrator
can use this id, an audit trail for command executed by system administrator is not available at
database level. To mitigate this, the Company implemented a customised solution that allows
to check if system administrator has logged in through this user id, the command executed and
final modified values
20. During the year the Company has submitted all documents for shifting its registered office from
office No. A-11(7), Udya Society, Sector-3, Tatibandh, Raipur, Dharsiwa, Chattisgarh, India,
492099 to No. A-1, UPSIDC Industrial Area,Nandgaon Road,Kosi Kalan,District Mathura,
281403 (U.P.) India
21. The financial statements were approved and adopted by the Board of directors of the Company
in their meeting dated 12th May,2026 and are subject to shareholder approval at the forthcoming
Annual General Meeting of shareholders.
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