1.13 Provisions and contingencies
Provisions: Provisions are recognized when there is a present obligation or constructive obligation as a result of a
past event and it is probable that an outflow of resources embodying economic benefits will be required to settle the
obligation and there is a reliable estimate of the amount of the obligation. Provisions are determined by discounting
the expected future cash flows at a pre-tax rate that reflects current market assessment of the time value of money
and the risks specific to the liability.
Contingent Liabilities: 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.
1.14 Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity
instrument of another entity. Financial assets and financial liabilities are recognized when the Company becomes a
party to the contractual provisions of the instruments.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly
attributable to the acquisition or issue of financial instruments (other than financial assets and financial liabilities at
fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial
liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial
assets or financial liabilities at fair value through profit or loss are recognized immediately in the profit or loss.
Subsequently, financial instruments are measured according to the category in which they are classified.
1.15 Financial assets
All purchases or sales of financial assets are recognized and de-recognized on a trade date basis. Regular way
purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame
established by regulation or convention in the marketplace.
All recognized financial assets are subsequently measured in their entirety at either amortized cost or fair value,
depending on the classification of the financial assets.
1.15.1. Classification of financial assets
Classification of financial assets depends on the nature and purpose of the financial assets and is
determined at the time of initial recognition.
The Company classifies its financial assets in the following measurement categories:
• those to be measured subsequently at fair value (either through other comprehensive income, or
through profit or loss), and
• those measured at amortized cost
The classification depends on the Company's business model for managing the financial assets and the
contractual terms of the cash flows.
A financial asset that meets the following two conditions is measured at amortized cost unless the asset is
designated at fair value through profit or loss under the fair value option:
• Business model test : the objective of the Company's business model is to hold the financial asset to
collect the contractual cash flows.
• Cash flow characteristic test : the contractual term 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.
A financial asset that meets the following two conditions is measured at fair value through other
comprehensive income unless the asset is designated at fair value through profit or loss under the fair
value option:
• Business model test : the financial asset is held within a business model whose objective is achieved
by both collecting cash flows and selling financial assets.
• Cash flow characteristic test : the contractual term of the financial asset gives rise on specified dates
to cash flows that are solely payments of principal and interest on the principal amount outstanding.
All other financial assets are measured at fair value through profit or loss.
1.15.2. Financial assets at fair value through profit or loss (FVTPL)
Investment in equity instrument are classified at fair value through profit or loss, unless the Company
irrevocably elects on initial recognition to present subsequent changes in fair value in other comprehensive
income for investments in equity instruments which are not held for trading.
Financial assets that do not meet the amortized cost criteria or fair value through other comprehensive
income criteria are measured at fair value through profit or loss. A financial asset that meets the amortized
cost criteria or fair value through other comprehensive income criteria may be designated as at fair value
through profit or loss upon initial recognition if such designation eliminates or significantly reduces a
measurement or recognition inconsistency that would arise from measuring assets and liabilities or
recognizing the gains or losses on them on different bases.
Investments in debt based mutual funds are measured at fair value through profit and loss.
Financial assets which are fair valued through profit or loss are measured at fair value at the end of each
reporting period, with any gains or losses arising on re measurement recognized in profit or loss.
1.15.3. Trade receivables
Trade receivables are recognized initially at fair value and subsequently measured at amortized cost less
provision for impairment.
1.15.4. Cash and cash equivalents
Cash flows are reported using the indirect method, whereby profit for the year is adjusted for the effects of
transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or
payments and item of income or expenses associated with investing or financing cash flows. The cash
flows from operating, investing and financing activities of the Company are segregated.
In the cash flow statement, cash and cash equivalents includes cash in hand, cheques and drafts in hand,
balances with bank and deposits held at call with financial institutions, short-term highly liquid investments
with original maturities of three months or less that are readily convertible to known amounts of cash and
which are subject to an insignificant risk of changes in value. Bank overdrafts are shown within borrowings
in current liabilities in the balance sheet and forms part of financing activities in the cash flow statement.
1.15.5. Impairment of financial assets
The Company assesses impairment based on expected credit losses (ECL) model to the following:
• financial assets measured at amortized cost
• financial assets measured at fair value through other comprehensive income
Expected credit loss are measured through a loss allowance at an amount equal to:
• the twelve month expected credit losses (expected credit losses that result from those default events
on the financial instruments that are possible within twelve months after the reporting date); or
• full life time expected credit losses (expected credit losses that result from all possible default events
over the life of the financial instrument).
For trade receivables or any contractual right to receive cash or another financial asset the Company
always measures the loss allowance at an amount equal to lifetime expected credit losses.
1.15.6. Income recognition
Interest Income: Interest income from debt instruments is recognized using the effective interest rate
method.
1.16 Financial liabilities
i) Initial Recognition:
All financial liabilities are recognized initially at fair value and, in the case of loans and borrowings, debt
instruments and payables, net of directly attributable transaction costs. The Company's financial liabilities
include trade and other payables
ii) Subsequent measurement:
All financial liabilities are subsequently measured at amortized cost using the effective interest rate
method.
Financial liabilities that are not held for trading and are not designated as at FVTPL are measured at
amortized cost at the end of the subsequent accounting period.
Amortized cost is calculated by taking into account any discount or premium on issue of funds, and
transaction costs that are an integral part of the Effective Interest Rate("EIR").
Any fees, paid or received, transaction costs and other premiums or discounts that are included in the
calculation of the effective interest rate are amortized over the expected life of the financial instrument.
The carrying amount of financial liabilities that are subsequently measured at amortized cost are
determined based on the effective interest rate method. Interest expense that is not capitalized as part of
costs of an asset is included in the "Finance costs" in Statement of Profit and Loss.
iii) De-recognition:
A financial liability is derecognized when the obligation under the liability is discharged or cancelled or
expires.
When an existing financial liability is replaced by another from the same lender
a. on substantially different terms, or the terms of an existing liability are substantially modified, such an
exchange or modification is treated as the de-recognition of the original liability and the recognition of a
new liability. The difference in the respective carrying amounts is recognized in the Statement of Profit
and Loss.
b. with no substantially different terms, or the terms of an existing liability are not substantially modified,
such an exchange or modification is treated as modification of original liability. The difference in the
respective carrying amounts is recognized in the Statement of Profit and Loss or amortized as
expenses over the period of time.
For financial liabilities that are denominated in a foreign currency and are measured at amortized cost
at the end of each reporting period, the foreign exchange gains and losses are determined based on
the amortized cost of the instruments and are recognized in profit or loss. The fair value of financial
liabilities denominated in a foreign currency is determined in that foreign currency and translated at the
exchange rate at the end of the reporting period. For financial liabilities that are measured as at fair
value through profit or loss, the foreign exchange component forms part of the fair value gains or losses
and is recognized in profit or loss
1.16.1. Debt Securities:
The Optionally Convertible Debentures ("OCD") and Non-Convertible Debentures ("NCD") issued by the
Company are Financial Liability because the issuer has an obligation to transfer financial assets to the
holder of the debt securities.
The OCDs and NCDs are issued as a part of exchange of existing loan under restructuring agreement.
The terms are substantially modified on such exchange i.e. 10% test is passed and the principle of
"extinguishment accounting" are applied.
The old loan is de-recognized and the debt securities issued are recognized at fair value. The difference
between the carrying value and the fair value of debt securities is charged to the profit and loss account.
The Company has incurred expenses with respect to loan syndication fees and Commitment fees, which
relate to restructuring when it was unlikely that the restructuring arrangement will be entered into, are
charged to profit and loss account.
The debt securities are subsequently measured at amortized cost using the effective interest rate method.
The value of redemption is reduced from carrying value of the debt securities.
1.16.2. Borrowings:
As per the restructuring plan sanctioned, the borrowings are exchanged with the existing borrower
for substantially modified terms. The 10% test is passed and the principle of "extinguishment accounting"
are applied.
The old loan or borrowings are de-recognized and the new loan or borrowings are recognized at fair value.
The difference between the carrying value and the fair value of new loan or borrowings is charged to the
profit and loss account.
The Company has incurred expenses with respect to loan syndication fees and Commitment fees, which
relate to restructuring when it was unlikely that the restructuring arrangement will be entered into, are
charged to profit and loss account. The loans and borrowings are subsequently measured at amortized
cost using the effective interest rate method.
1.16.3. Trade and other payables:
Trade and other payables represent liabilities for goods or services provided to the Company prior to the
end of financial year which are unpaid.
1.17. Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating
decision maker.
1.18. Leases
The Company as a lessee:
The Company's lease asset classes primarily consist of leases for land and buildings. 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 (ROU) asset and a corresponding
lease liability for all lease arrangements in which it is a lessee, except for leases with a term of 12 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.
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 incentives. 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. ROU 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 ROU asset if the Company changes its assessment of whether it will
exercise an extension or a termination option.
Lease liability and ROU assets have been separately presented in the Balance Sheet and lease payments have
been classified as financing cash flows.
Effective April 1,2019, the Company has adopted Ind AS 116 'Leases' and applied the standard to it's existing lease
contracts using the modified retrospective approach under which the ROU Asset is measured based on the
remaining lease payments.
1.19 Borrowing costs
General and specific borrowing costs that are directly attributable to the acquisition, construction or production of a
qualifying asset are capitalized during the period of time that is required to complete and prepare the asset for its
intended use or sale. Qualifying assets are assets that necessarily take a substantial period of time to get ready for
their intended use or sale.
Investment income earned on the temporary investment of specific borrowings pending their expenditure on
qualifying assets is deducted from the borrowing costs eligible for capitalization.
Other borrowing costs are expensed in the period in which they are incurred.
1.20. Government grants
Grants from the government are recognized at their fair value where there is a reasonable assurance that the grant
will be received and the Company will comply with all attached conditions.
Government grants relating to income are deferred and recognized in the profit or loss over the period necessary to
match them with the costs that they are intended to compensate and presented within other income.
Government grants relating to the purchase of property, plant and equipment are included in non-current liabilities
as deferred income and are credited to profit or loss on a straight-line basis over the expected lives of the related
assets and presented within other income.
1.21. Earnings per Share
Basic earnings per share have been computed by dividing the net income by the weighted average number of
shares outstanding during the year. Diluted earnings per share has been computed using the weighted average
number of shares and diluted potential shares, except where the result would be anti-dilutive.
1.22. Dividends
In order to conserve the financial resources for operational requirements, the Board has not recommended
any dividend for the year 2025-26. Also no amount has been transferred to reserves.
I) General reserve: Part of retained earnings was earlier utilised for declaration of dividends as per the erstwhile
Companies Act, 1956. This is available for distribution to share holders.
ii) Retained earnings: Company's cumulative earnings since its formation minus the dividends/capitalisation and
earnings transferred to general reserve
iii) Securities Premium: Securities premium reserve is used to record the premium on issue of shares. The reserve
is utilised in accordance with the provisions of the Companies Act 2013.
iv) Capital Reserve: Comprises of amount forfeited on lapse of share warrants, the same is not available for
distribution .
v) Fair Value Reserve : Fair value reserve is credited when property, plant and equipment's are revalued at fair
value and debited on retirement or Impairment or disposal of assets. The reserve is utilised in accordance with
the requirements of Ind AS 16.
The sensitivity analysis have been determined based on reasonably possible changes of the respective
assumptions occurring at the end of the reporting period, while holding all other assumptions constant.
The sensitivity analysis presented above may not be representative of the actual change in the Defined Benefit
Obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the
assumptions may be correlated.
Furthermore, in presenting the above sensitivity analysis, the present value of the Defined Benefit Obligation has
been calculated using the projected unit credit method at the end of the reporting period, which is the same method
as applied in calculating the Defined Benefit Obligation as recognised in the balance sheet.
There was no change in the methods and assumptions used in preparing the sensitivity analysis from prior years.
Notes
Gratuity is payable as per entity's scheme as detailed in the report.
"Actuarial gains/losses are recognized in the period of occurrence under Other Comprehensive Income (OCI).All
above reported figures of OCI are gross of taxation."
Salary escalation & attrition rate are considered as advised by the entity; they appear to be in line with the industry
practice considering promotion and demand & supply of the employees.
Maturity Analysis of Benefit Payments is undiscounted cash flows considering future salary, attrition & death in
respective year for members as mentioned above.
Average Expected Future Service represents Estimated Term of Post - Employment Benefit Obligation.
Weighted Average Duration of the Defined Benefit Obligation is the weighted average of cash flow timing, where
weights are derived from the present value of each cash flow to the total present value.
Any benefit payment and contribution to plan assets is considered to occur end of the year to depict liability and fund
movement in the disclosures.
Value of asset provided by the entity is not audited by us and the same is considered as unaudited fair value of plan
asset as on the reporting date.
In absence of specific communication as regards contribution by the entity, Expected Contribution in the Next Year is
considered as the sum of net liability/assets at the end of the current year and current service cost for next year,
subject to maximum allowable contribution to the Plan Assets over the next year as per the Income Tax Rules.
Qualitative Disclosures
Para 139 (a) Characteristics of defined benefit plan
"The entity has a defined benefit gratuity plan in India (funded). The entity's defined benefit gratuity plan is a final
salary plan for employees, which requires contributions to be made to a separately administered fund.
The fund is managed by a trust which is governed by the Board of Trustees. The Board of Trustees are responsible
for the administration of the plan assets and for the definition of the investment strategy."
Para 139 (b) Risks associated with defined benefit plan
"Gratuity is a defined benefit plan and entity is exposed to the Following Risks:
Interest rate risk: A fall in the discount rate which is linked to the Government Securities. 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.
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.
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.
Asset Liability Matching Risk: The plan faces the ALM risk as to the matching cash flow. Since the plan is invested
in lines of Rule 101 of Income Tax Rules, 1962, this generally reduces ALM risk.
Mortality 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.
Concentration Risk: Plan is having a concentration risk as all the assets are invested with the insurance company
and a default will wipe out all the assets. Although probability of this is very low as insurance companies have to
follow stringent regulatory guidelines which mitigate risk.
Para 139 (c) Characteristics of defined benefit plans
During the year, there were no plan amendments, curtailments and settlements.
Para 147 (a)
A separate trust fund is created to manage the Gratuity plan and the contributions towards the trust fund is done as
guided by rule 103 of Income Tax Rules, 1962.
This section explains the judgements and estimates made in determining the fair values of the financial instruments that
are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed
in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the
company has classified its financial instruments into the three levels prescribed under the accounting standard. An
explanation of each level follows underneath the table.
Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity
instruments, traded bonds and mutual funds that have quoted price. The fair value of all equity instruments (including
bonds) which are traded in the stock exchanges is valued using the closing price as at the reporting period. The mutual
funds are valued using the closing NAV.
Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the-
counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely
as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable,
the instrument is included in level 2.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level
3. This is the case for unlisted equity securities, contingent consideration and indemnification asset included in level 3.
There are no transfers between levels 1 and 2 during the year.
The company's policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the
reporting period.
The carrying amounts of trade receivables, trade payables, loans, deposits, advances, borrowings, cash and cash
equivalents and other current financial liabilities are considered to be the same as their fair values, due to their short-term
nature.
34 Financial risk management
The Company's activities expose it to market risk, liquidity risk and credit risk.
This note explains the sources of risk which the entity is exposed to and how the entity manages the risk.
(A) Credit risk
Credit risk on deposit is mitigated by depositing the funds in reputed private sector bank.
For trade receivables, the primary source of credit risk is that these are unsecured. The Company sells the products
to customers only when the collection of trade receivables is certain and whether there has been a significant
increase in the credit risk on an on-going basis is monitored throughout each reporting period. As at the balance
sheet date, based on the credit assessment the historical trend of low default is expected to continue.
An impairment analysis is performed at each reporting date on an individual basis for major clients. Any
recoverability of receivables is provided for based on the impairment assessment. Historical trends showed as at the
transition date, 31st March 2017 and 31st March 2018 company had no significant credit risk.
(B) Liquidity risk
Objective of liquidity risk management is to maintain sufficient cash and marketable securities and the availability of
funding through an adequate amount of committed credit facilities to meet obligations when due. Management
monitors rolling forecasts of the company's liquidity position (comprising the undrawn borrowing facilities below)
and cash and cash equivalents on the basis of expected cash flows. The company's liquidity management policy
involves projecting cash flows in major currencies and considering the level of liquid assets necessary to meet
these, monitoring balance sheet liquidity ratios against internal requirements.
Maturities of financial liabilities
The tables below analyse the company's financial liabilities into relevant maturity groupings based on their
contractual maturities for:
a) all non-derivative financial liabilities, and
b) net and gross settled derivative financial instruments for which the contractual maturities are essential for an
understanding of the timing of the cash flows.
The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months
equal their carrying balances as the impact of discounting is not significant.
35 Capital management
a) Risk management
The Company's objectives when managing capital are to :
• safeguard their ability to continue as a going concern, so that they can continue to provide returns for
shareholders and benefits for other stakeholders, and
• maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, The company may adjust the amount of dividends paid to
shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
Consistent with others in the industry, The company monitors capital on the basis of the following gearing ratio:
Net debt (total borrowings net of cash and cash equivalents)
divided by
Total ‘equity' (as shown in the balance sheet).
3. Security Details for the Borrowings :
i) Rupee Term Loan (RTL), Tranche A Non-Convertible Debentures (NCDs) and Tranche A Optionally Convertible
Debentures (OCDs) for State Bank of India is secured by:
a. First pari passu charge over all fixed assets of the Borrower ('the Company") (except the fixed assets over
which an exclusive charge is created in favour of Kotak Mahindra Bank Limited, ICICI Bank Limited and State
Bank of India).
b. First pari passu charge over the cogeneration Receivables of Unit II and Unit III.
c. Second pari passu charge over all current assets of the Borrower except the current assets set out in Section
(b) above
d. First pari passu pledge over the Pledged Shares.
"Pledged Shares" means, at the date of the Framework Restructuring Agreement (FRA) ie 12th July 2021,
1,34,92,021 Equity Shares of the Borrower held by the Pledgors (Promoter and Promoter Group) which are
pledged to secure the Outstanding Obligations in accordance with the terms of the Share Pledge Agreement ,
and such additional Equity Shares so that the Pledged Shares shall at all times constitute 100% of the total
Equity Shares of the Borrower held by the Promoters at any time.
e. Unconditional and irrevocable Personal Guarantee of the Personal Guarantor (Ms.Rajshree Pathy, Promoter /
Chairperson of the Company)
f. Irrevocable Corporate Guarantee provided by RSCL Properties Private Limited (RPPL), to the extent of the
Value of the Pledged Shares held by RPPL. It is further clarified that the Secured Parties shall have no
independent rights under the Corporate Guarantee in the event that they are able to enforce their rights and
recover the Value of the Pledged Shares under the Share Pledge Agreement.
g. First pari passu charge over the Fixed Deposit amount of '108 lakhs.
h. First pari passu charge on the land and building (Bio Control Unit at Unit 1) situated at Gullapuram Village,
Periyakulam Taluk, Theni District, Tamil Nadu;
i. First ranking exclusive charge on fixed assets of the Borrower situated at the co-generation plant of Unit II
situated at Mundiyampakkam, Tamil Nadu.
j. First pari passu charge on all the fixed assets of the Borrower situated at Unit III, which fixed assets shall be
charged to State Bank of India and Kotak Mahindra Bank Limited on a pari passu basis.
k. First pari passu charge on non-agricultural land admeasuring 1 acre and cents 15-1/6 in Udhagamandalam,
Tamil Nadu (including the building with a built-up area of 300 sq. ft.), belonging to Ms. Rajshree Pathy,
Chairperson / Promoter of the Company.
ii) Working Capital Term Loans (WCTL) for State Bank of India is secured by:
a. Second pari passu charge over all fixed assets of the Borrower except the fixed assets over which an exclusive
charge is created in favour of Kotak Mahindra Bank Limited, ICICI Bank Limited and State Bank of India.
b. First pari passu charge over the cogeneration Receivables of Unit II and Unit III.
c. First pari passu charge over all current assets of the Borrower (except the current assets set out in Section (b)
above).
d. First pari passu pledge over the Pledged Shares.
e. Unconditional and irrevocable Personal Guarantee provided by the Personal Guarantor.
f. Irrevocable Corporate Guarantee provided by RPPL, limited to the extent of the Value of the Pledged Shares
held by RPPL. It is further clarified that the Secured Parties shall have no independent rights under the
Corporate Guarantee in the event that they are able to enforce their rights and recover the Value of the Pledged
Shares under the Share Pledge Agreement.
g. First pari passu charge over the Fixed Deposit amount of '108 lakhs.
h. Second pari passu charge on the land and building (Bio Control Unit at Unit 1) situated at Gullapuram
Village, Periyakulam Taluk, Theni District, Tamil Nadu;
i. First ranking exclusive charge on fixed assets of the Borrower situated at the co-generation plant of Unit II
situated at Mundiyampakkam, Tamil Nadu.
j. First pari passu charge on all the fixed assets of the Borrower situated at Unit III, which fixed assets shall be
charged to State Bank of India and Kotak Mahindra Bank Limited on a pari passu basis.
k. First pari passu charge on non-agricultural land admeasuring 1 acre and cents 15-1/6 in Udhagamandalam,
Tamil Nadu (including the building with a built-up area of 300 sq. ft.), belonging to Ms.Rajshree Pathy,
Chairperson / Promoter of the Company.
iii) RTL, Tranche D NCDs, Tranche D OCDs and FITL for Bank of India, UCO Bank and Federal Bank Limited is
secured by:
a. First pari passu charge over all fixed assets of the Borrower (except the fixed assets over which an exclusive
charge is created in favour of Kotak Mahindra Bank Limited, ICICI Bank Limited and State Bank of India).
b. First pari passu charge over the cogeneration Receivables of Unit II and Unit III.
c. Second pari passu charge over all current assets of the Borrower except the current assets set out in Section(b)
above.
d. First pari passu pledge over the Pledged Shares.
e. Unconditional and irrevocable Personal Guarantee provided by the Personal Guarantor.
f. Irrevocable Corporate Guarantee provided by RPPL, limited to the extent of the Value of the Pledged Shares
held by RPPL. It is further clarified that the Secured Parties shall have no independent rights under the
Corporate Guarantee in the event that they are able to enforce their rights and recover the Value of the Pledged
Shares under the Share Pledge Agreement.
g. First pari passu charge over the Fixed Deposit amount of '108 lakhs
h. First pari passu charge on the land and building (Bio Control Unit at Unit 1) situated at Gullapuram Village,
Periyakulam Taluk, Theni District, Tamil Nadu;
i. First pari passu charge on non-agricultural land admeasuring 1 acre and cents 15-1/6 in Udhagamandalam,
Tamil Nadu (including the building with a built-up area of 300 sq. ft.), belonging to Ms.Rajshree Pathy,
Chairperson / Promoter of the Company.
j. Second pari passu charge on all fixed assets of the Borrower situated at Unit III.
iv) WCTL for Bank of India and UCO Bank is secured by:
a. Second pari passu charge over all fixed assets of the Borrower (except the fixed assets over which an exclusive
charge is created in favour of Kotak Mahindra Bank Limited, ICICI Bank Limited and State Bank of India).
b. First pari passu charge over the cogeneration Receivables of Unit II and Unit III.
c. First pari passu charge over all current assets of the Borrower except the current assets set out in Section (b)
above.
d. First pari passu pledge over the Pledged Shares.
e. Unconditional and irrevocable Personal Guarantee provided by the Personal Guarantor.
f. Irrevocable Corporate Guarantee provided by RPPL, limited to the extent of the Value of the Pledged Shares
held by RPPL. It is further clarified that the Secured Parties shall have no independent rights under the
Corporate Guarantee in the event that they are able to enforce their rights and recover the Value of the Pledged
Shares under the Share Pledge Agreement.
g. First pari passu charge over the fixed deposit amount of '108 lakhs.
h. Second pari passu charge on the land and building (Bio Control Unit at Unit 1) situated at Gullapuram
Village, Periyakulam Taluk, Theni District, Tamil Nadu; and
i. First pari passu charge on non-agricultural land admeasuring 1 acre and cents 15-1/6 in Udhagamandalam,
Tamil Nadu (including the building with a built-up area of 300 sq. ft.), belonging to Ms.Rajshree Pathy,
Chairperson / Promoter of the Company
j. Second pari passu charge on all fixed assets of the Borrower situated at Unit III.
v) RTL, Tranche B OCDs, Tranche B NCDs and FITL for ICICI Bank Limited is secured by:
a. First pari passu charge over all fixed assets of the Borrower (except the fixed assets over which an exclusive
charge is created in favour of Kotak Mahindra Bank Limited, ICICI Bank Limited and State Bank of India).
b. First pari passu charge over the cogeneration Receivables of Unit II and Unit III.
c. Second pari passu charge over all current assets of the Borrower (except the current assets set out in Section
(b) above).
d. First pari passu pledge over the Pledged Shares.
e. Unconditional and irrevocable Personal Guarantee provided by the Personal Guarantor.
f. Irrevocable Corporate Guarantee provided by RPPL, limited to the extent of the Value of the Pledged Shares
held by RPPL. It is further clarified that the Secured Parties shall have no independent rights under the
Corporate Guarantee in the event that they are able to enforce their rights and recover the Value of the Pledged
Shares under the Share Pledge Agreement.
g. First pari passu charge over the fixed deposit amount of '108 lakhs
h. First pari passu charge on the land and building (Bio Control Unit at Unit 1) situated at Gullapuram Village,
Periyakulam Taluk, Theni District, Tamil Nadu;
i. First ranking exclusive charge on the 7.295 Acres Land at Pallipuram Village, Allepey District, Kerala;
j. First pari passu charge on non-agricultural land admeasuring 1 acre and cents 15-1/6 in Udhagamandalam,
Tamil Nadu (including the building with a built-up area of 300 sq. ft.), belonging to Ms.Rajshree Pathy,
Chairperson / Promoter of the Company.
k. Second pari passu charge on all fixed assets of the Borrower situated at Unit III.
vi) RTL, Tranche C NCDs, Tranche C OCDs and FITL from Axis Bank Limited.
All the loans / facilities availed from the Axis Bank Limited have been repaid during the year, subject to Right of
Recompense as per Axis Bank Sanction Letter dated 30-06-2021.
vii) DLOD and CC from Kotak Mahindra Bank Limited
a. First pari passu charge on all fixed assets of Unit-III
b. First pari passu charge on all current assets of the Borrower except Cogeneration receivables of Unit-II & III.
4. Exceptional item includes:
Exceptional Item represents additional provision of Gratuity and Leave encashment of '200.86 lakhs to give effect to
incremental impact arises due to change in wage definition as notified by the Central Government on 21.11.2025.
10) Contingent Liabilities not provided for
a) Claims against the company not acknowledged as debt:
i. In the case of eligibility of exemption on molasses captively consumed and eligibility of cenvat credit availed on
molasses procured from other Units in Unit III for the period from Apr'14 to Jun'17, The Commissioner of GST
and Central Excise, Chennai has raised a demand of '62.84 Crores (Principal - '21.67 Crores and
Penalty/Interest - '41.17 Crores).The company has filed a writ petition before Madras High Court challenging
the demand and the case is pending for disposal.
With regard to show cause notice for a sum of '80.38 lacs relating to Apr'12 to Jun'12,the Additional
Commissioner of GST & Central Excise has issued an order dated 29.09.2023 with a demand of '161 lacs
(Principal - '80.38 lacs and Penalty - '80.38 lacs) in addition to appropriate interest on the same. Aggrieved,
the company had filed an appeal before the Commissioner -Appeal and the demand has been confirmed by the
order dated 28.11.2025. The company has filed its appeal before appellate tribunal and the same is pending.
ii. The State Electricity Board had demanded parallel operation charges for the period 2014 to 2019 against all the
three Cogeneration units. The company had filed its appeal before Appellate Tribunal for Electricity (APTEL).
APTEL has rendered its judgment, on 16.06.2025, favorable to the Sugar Cogeneration plants in Tamil Nadu
on the demand of Parallel operation Charges by TANGEDCO. Caveat Appeal has been filed on 09.07.2025 by
minimum representative members of South Indian Sugar Mills Association (Tamil Nadu), in which the company
is a member, before Supreme Court, for not to pass any order without hearing the appellants, as a
precautionary measure if TANGEDCO appeals before Supreme Court against the order of the APTEL.
Subsequently, TANGEDCO has filed its appeal before the Supreme Court and the case is pending. The total
demand for all the 3 of units of RSCL has been at '4.99 crores.
iii) Recompense amount payable as per Debt Restructuring Scheme as at the close of the year ending 31.3.2026
is '238.34 Crores.
11) In terms of Ind AS-36, the company had carried out an exercise to ascertain the impairment, if any, in the carrying values
of its Fixed assets. The exercise has not revealed any impairment of assets.
12) Non-Convertible Debentures
The redemption amount payable, as per Framework Restructuring Agreement, as on 31st March 2026 has been at
'8,709 lakhs.
13) Optionally Convertible Debentures
The redemption amount payable as per aforesaid agreement as on 31st March 2026 has been at '11,914 lakhs.
14) Equity Shares
As per terms of the Debt Restructuring plan approved by the lenders and in terms of provision in Framework
Restructuring Agreement (FRA) executed on 12th July 2021, the company has allotted 49,67,926 (15%) equity shares to
lenders on 27th August 2021. As on 31st March 2026, the lender banks sold (12.13%) shares in the open market out of
the aforesaid allotted shares.
The promoter purchased 18,400 equity shares through off-market purchase on 25th March 2025 and created a pledge
with the SBICAP Trustee Company Limited (Security Trustee) during year under review.
15) CSR Activities
Gross amount required to be spent by the company during the year - NIL
Amount spent by the company during the year - NIL
17. ADDITIONAL REGULATORY INFORMATION:
a) The title deeds in respect of self-constructed buildings and title deeds of all other immovable properties (other than
properties where the company is the lessee and the lease agreements are duly executed in favour of the lessee),
disclosed in the financial statements included under Property, Plant and Equipment are held in the name of the
Company as at the balance sheet date.
b) The Company does not have any Benami property, where any proceeding has been initiated or pending against the
Company for holding any Benami property.
c) The Company has not revalued any of its Property, Plant and Equipment (including Right-of-Use Assets) and
Intangible assets during the year.
d) The Company has not given any Loans or advances in the nature of Loans to promoters directors, KMPs and the
related parties (as defined under Companies Act, 2013), either severally or jointly with any other person.
e) The Company does not have any intangible assets under development as at 31/03/2026 and as at 31/03/2025.
f) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory
period.
g) As per the information available with the Company, the Company has no transactions with the companies struck off
under section 248 of the Companies Act, 2013 or section 560 of Companies Act, 1956
h) The Company has not advanced or loaned or invested funds (either borrowed funds or share premium or any other
sources or kind of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries).
i) The Company has not received any fund from any person(s) or entity(is), 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.
j) 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 provisions of the Income Tax Act, 1961.
k) The Company is not declared as willful defaulter by any bank or financial institution (as defined under the
Companies Act, 2013) or consortium thereof or other lender in accordance with the guidelines on willful defaulters
issued by the Reserve Bank of India.
l) The Company does not have any downstream investments in the form of subsidiary, joint venture and associate
companies.
m) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
The Company operates wholly within the geographical limits of India. Revenue from sales to customers outside India is / was nil in the current and previous
years. Hence, disclosures on geographical segments are not applicable.
21) Previous year figures have been regrouped wherever necessary to confirm to current year's classification. All figures have been rounded off to lakhs unless
stated otherwise. Discrepancies if any in between totals and some of the items forming part of such totals are due to rounding off in the financial statements.
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