b. Terms and Rights attached to each class of shares:

i) The Shareholders of the Company, at the Ordinary General Meeting held on April 14, 2023, had approved the subdivision of one equity share of face value 10 each into 5 equity share of face value 2 each. The record date for the said sub-division was set at April 14, 2023.

ii) The company has a single class of equity shares. Accordingly, all equity shares rank equally with regard to dividends and share in the company's residual assets on winding up.

iii) The voting rights of an equity shareholder on a poll (not on show of hands) are in proportion to his/its share of the paid-up equity share capital of the company.

iv) Voting rights cannot be exercised in respect of shares on which any call or other sums presently payable has not been paid.

v) Failure to pay any amount called up on shares may lead to their forfeiture.

vi) On winding up of the company, the holders of equity shares will be entitled to receive the residual assets of the company, remaining after meeting all liabilities, in proportion to the number of equity shares held.

Note: a. Working Capital Loan from SBI is secured against Inventory, Book Debts, Plant and Machinery, Land and Fixed Deposits held in the name of company

b. All the above credit facilities are guaranteed by Mr. Arvind Kamath, Mr. Goutam Rampelli, Mr. Dipak Bharuka, Mrs Priya Bharuka, Mascot Capital & Marketing Pvt Ltd and Mascot Business Solution Pvt Ltd.

c. Working Capital Loan from HDFC Bank is secured against post dated cheque of INR 100 Millions.

d. Funds raised on short term basis have not been utilised for long term purposes .

e. Borrowed funds were applied for the purpose for which the loans were obtained.

f. Bank returns / stock statements filed by the Company with its bankers or financial institutions are in agreement with books of account.

g. The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.

h. The Company do not have any charges or satisfaction, which is yet to be registered with ROC beyond the statutory period.

Share Split and Bonus Issue:

The basic and diluted earning per share for the current period and previous periods presented have been calculated / restated after considering the share split and bonus issue and appropriate adjustments to outstanding options granted to employees under the ESOP scheme (Refer note 14).

E. Terms and Conditions:

a) Transactions with related parties are made on terms equivalent to those that prevail in arm's length transactions.

b) All the credit facilities of INR 437.99 Million as on March 31, 2024 (INR 301.41 Million as on March 31, 2023) and are guaranteed by Mr Arvind Kamath, Mr Goutam Rampelli, Mr. Dipak Bharuka, Mrs. Priya Bharuka, Mascot Capital & Marketing Pvt Ltd and Mascot Business Solution Pvt Ltd. Term loan of INR 39.52 Million as on March 31, 2024 (INR 36.22 Million as on March 31, 2023 ) comprises of car loans and GECL Loan which is part of the credit facilities availed.

The Income Tax demands for AY 2020-21 has been raised on account of late payment of employee contribution to Provident Fund.The company has submitted online responses disagreeing with the Demand stating that the contribution has been paid to respective funds before the due date for filing return of income and the same should be allowed.

The Income Tax Demands for AY 2013-14 relate to disallowance of TDS Credit pertaining to income booked in the relevant Assessment Years but appearing in Form 26AS of the subsequent Assessment Years. The company has submitted online responses disagreeing with the Demands.

The Income Tax demands for AY 2021-22 have been raised on account of late payment of employee contribution to Provident Fund.The company has submitted online responses disagreeing with the Demand stating that the contribution has been paid to respective funds before the due date for filing return of income and the same should be allowed.

The CST Demand of Rs. 1,05,31,814 for FY 2011-12 was due to disallowance of Sales u/s 6(2) of the CST Act, 1956. The said demand is settled for Rs. 21,16,094 as per Maharashtra Sales Tax Amnesty Scheme.

Fair value of financial assets and financial liabilities measured at amortised cost.

The carrying amounts of trade receivables, loans, advances, cash and other bank balances are considered to be the same as their fair values due to their short term nature. The carrying amounts of long term loans given with fixed rate of interest are considered at fair value.

The carrying amount of trade and other payables are considered to be the same as their fair values due to their short term nature.The carrying amounts of borrowings with floating rate of interest are considered to be close to fair value.

NOTE 36 : CAPITAL MANAGEMENT

The primary objective of capital management of the Company is to maximise Shareholder value. The Company monitors capital using Debt-Equity ratio which is total debt divided by total equity. For the purposes of capital management, the Company considers the following components of its Balance Sheet to manage capital:

Total equity includes General reserve, Retained earnings, Share capital and Security premium.

Total debt includes current debt plus non-current debt.

NOTE 37 : FINANCIAL RISK MANAGEMENT

Risk management framework

The Company's Board of Directors has overall responsibility for the establishment and oversight of the Company's risk management framework. The Board oversee the management of these financial risks through its Risk Management Committee as per Company's existing policy.

The Company has exposure to the following risks arising from financial instruments: -

A. Credit risk

i. Credit risk is the risk of financial loss to the Company if a customer or counter party to a financial instrument fails to meet its contractual obligations. The Company is exposed to credit risk from its operating activities (primarily trade receivables), deposits with banks and other financial instruments. Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed upon. Details of the same have been discussed below.

ii. Exposure to Risk

a. Trade Receivables

The Company extends credit to customers in the normal course of business. The Company considers factors such as financial conditions / market practices, credit track record in the market, analysis of historical bad debts and past dealings for extension of credit to customers. Individual credit limits are set accordingly. The Company monitors the payment track record of the customers and ageing of receivables. Outstanding customer receivables are regularly monitored. The Company considers the concentration of risk with respect to trade receivables including retention money as low.

c. Other Financial Instruments

The Company considers factors such as track record, size of the institution, market reputation, financial strength/ rating and service standards to select the banks with which balances and deposits are maintained. Generally, the balances are maintained with the institutions from which the Company has also availed borrowings.

B. Liquidity Risk

i. Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at a reasonable price. For the Company, liquidity risk arises from obligations on account of financial liabilities -borrowings, trade payables and other financial liabilities. The Company's approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring losses or risking damage to the Company's reputation. The Company manages liquidity risk by maintaining adequate reserves, by continuously monitoring forecast and actual cash flows and matching the maturity profiles of the financial assets and liabilities. It maintains adequate sources of financing including loans, debt and other borrowings.

C. Market Risk -

i. 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.

ii. Exposure to Risk

a. Interest Rate Risk

Profit or loss is sensitive to higher/lower interest expense from borrowings as a result of change in interest rates. The following table demonstrates the sensitivity of floating rate financial instruments to a reasonably possible change in interest rates. The risk estimates provided assume a parallel shift of 100 basis points interest rate across all yield curves. This calculation also assumes that the change occurs at the balance sheet date and has been calculated based on risk exposures outstanding as at that date. The period end balances are not necessarily representative of the average debt outstanding during the period.

b. Foreign Currency Risk

The Company has entered into contracts wherein the revenue is receivable in foreign currency. These are not hedged.

The following table details the Company's sensitivity to a 1% increase and decrease in the Rupee against the relevant foreign currencies. 1% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management's assessment of the reasonably possible change in foreign exchange rates. This is mainly attributable to the net exposure outstanding on receivables or payables in the Company at the end of the reporting period. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 1% change in foreign currency rate.

c. Other Price Risk

The Company's investments are susceptible to market price risk arising from uncertainties about future values of the investments. These securities are unquoted. The Company manages the price risk through diversification and by placing limits on individual and total equity / mutual fund instruments. Company is not exposed to significant price risks.

Contract assets primarily relate to the Company's rights to consideration for work completed at the reporting date from contracts. The Contract assets are transferred to Trade receivables on completion of milestones.

The contract liabilities relate to customer advances where performance obligations are yet to be fulfilled as per the contracts. The fulfilment of the performance obligations will extinguish these liabilities and revenue will be recognised, with no impact on the Company's cash positions on specific projects.

NOTE 40 : DISCLOSURE ON SEGMENT REPORTING AS PER IND AS 108

The company is engaged in Fired Heaters products. Considering the nature of company's business and operations as well as reviews of operating results by the Chief Operating Decision Makers, the company has identified Fired Heaters and related products as only responsibile segment in accordance with the requirements of Ind AS 108 operating segment.

The Board of Directors of the Company has identified Chief Executive Officer as the chief operating decision maker of the Company. Management has determined the operating segments as mentioned above based on the reports reviewed by the CEO.

Since company operates in a single segment (business activity) of Fired Heaters and related products, disclosure regarding operating segments is not given.

NOTE 41 : DISCLOSURE ASSOCIATED WITH GRATUITY

Gratuity is a defined benefit plan and company is exposed to the Following Risks:

1. Investment risk:

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds. If the return on plan asset is below this rate, it will create a plan deficit. Currently, for the plan in India, it has a relatively balanced mix of investments in government securities, and other debt instruments.

2. Interest risk:

A fall in the discount rate which is linked to the G.Sec. Rate will increase the present value of the liability requiring higher provision. A fall in the discount rate generally increases the mark to market value of the assets depending on the duration of asset.

3. Longevity risk:

Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.

4. Salary risk:

The present value of the defined benefit plan liability is calculated by reference to the future salaries of members. As such, an increase in the salary of the members more than assumed level will increase the plan's liability.

The following table sets out the status of the gratuity plan and the amounts recognised in the Company's financial statements as at March 31, 2024.

NOTE 44 : ESOP

During the Financial year ended March 31, 2022, the Management of the Company has approved the "JNK EMPLOYEES STOCK OPTION PLAN, 2022. According to the said plan, the selected employees have been granted 2,21,000 ESOPs. The salient features of this Plan are as follows:

IV. Weighted average share price at the date of exercise for stock options exercised during the year is INR 129 per share.

V. (a) In respect of stock options granted pursuant to the Company's stock options scheme, the fair value of the options is

treated as discount and accounted as employee compensation over the vesting period.

(b) Expense on Employee stock options scheme debited to the statement of profit and loss account during 2023-24 is INR 120.40 Million (previous year INR 50.72 Million) (Note-27)

NOTE 46 : CODE ON SOCIAL SECURITY

The Code on Social Security, 2020 ('Code') has been notified in the Official Gazette in September 2020 which could impact the contribution by the Company towards certain employment benefits. The effective date from which the changes and rules would become applicable is yet to be notified. Impact of the changes will be assessed and accounted in the relevant period of notification of relevant provisions.

NOTE 47 : APPROVAL OF FINANCIAL STATEMENTS

The financial statements are approved for issue by the Audit Committee at their meeting held on May 30, 2024 and the Board of Directors at their meetings held on May 30, 2024

NOTE 48 : STATUTORY INFORMATION / COMPLIANCE

(i) The Company does not have any transaction with companies struck off under section 248 of the Companies Act, 2013 or section 560 of Companies Act, 1956.

(ii) Estimated amount of contracts remaining to be executed on capital account and not provided for is INR 16.50 Million (Previous Period and Year Nil).

(iii) The Company does not have any such 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 provisions of the Income Tax Act, 1961.)

(iv) The Company has not traded or invested in Crypto Currency or Virtual Currency during the year ended March 31, 2024 and preceding financial year ended March 31, 2023.

(v) No proceedings have been initiated or are pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act,1988 (45 of 1988) and rules made thereunder.

(vi) The company is not declared as wilful defaulter by any bank or financial institution or other lender.

(vii) The Company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with the Companies (Restriction on number of Layers) Rules, 2017.

(viii) The Company has not entered with any Scheme(s) of arrangement in terms of sections 230 to 237 of the Companies Act, 2013.

(ix) 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 company (ultimate beneficiaries) or

(b) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.

(x) 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 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.

NOTE 49: PRIOR PERIOD COMPARATIVE

Previous year's figures have been regrouped / reclassified wherever necessary to correspond with current year's classifications / disclosures.

Pursuant to amendment in Schedule III to the Companies Act, 2013, effective from April 1, 2021, the Company has modified the classification of certain items. Comparative amounts in the notes to the financial statements were accordingly reclassified for consistency.