*During the year 2020-21, the resolution plan of the Company was approved and implemented. As per approved resolution plan, the contingent liabilities and commitments, claims and obligations, stand extinguished and accordingly no outflow of economic benefits is expected in respect thereof. The Resolution Plan, among other matters provide that upon the approval of this Resolution Plan by the National Company Law Tribunal (NCLT) and settlement and receipt of the payment towards the IRP costs and by the creditors in terms of this plan, all the liabilities demands, damages, penalties, loss, claims of any nature whatsoever (whether admitted/verified/submitted/rejected or nor, due or contingent, asserted or unasserted, crystallized or uncrystallized, known or unknown, disputed or undisputed, present or future) including any liabilities, losses, penalties or damages arising out of noncompliances, to which the Company is or may be subject to and which pertains to the period on or before the Effective Date (i.e. 10^th February, 2021) and are remaining as on that date shall stand extinguished, abated and settled in perpetuity without any further act or deed. The Resolution Plan further provides that implementation of resolution plan will not affect the rights of the Company to recover any amount due to the Company and there shall be no set off of any such amount recoverable by the Company against any liability discharged or extinguished.

As at 31 March 2025, the Company reassessed its outstanding capital commitments in light of continued operational and financial challenges that resulted in the prolonged shutdown of its manufacturing facilities. Based on this review, the Company determined that previously disclosed commitments relating to orders for capital goods pending for more than three years are no longer enforceable or valid. Accordingly, the capital commitments have been revised to Nil. Further, the Company had already recognized an impairment provision of Rs. 1,625.33 lakhs against the related capital advances.

38. Exceptional Items (net) for the year comprises of:

a. The Company has made net reversal of an allowance for trade receivables under Expected credit losses (ECL) method aggregating to Rs. 1,313 lakhs, net of provision made, in compliance of Ind AS 109 which is charged to Statement of Profit & Loss as an exceptional item.

b. The Company has given trade advances to the suppliers that are outstanding for a long time. In view of reduction in activities, the materials and services could not be called from such suppliers. In compliance of Ind AS 36 impairment for trade advances amounting to Rs. (18.22) lakhs, net of provision made, which is charged to Statement of Profit & Loss as an exceptional item.

c. The company has made reversal of GST Input Tax amounting to Rs. (116.83) lakhs on trade payables outstanding for more than 180 days under rule 37 of CGST Rules and Sec. 16(2) of the CGST Act and interest thereon amounting to Rs. Nil lakhs which is charged to Statement of Profit & Loss as an exceptional item.

d. The company has written back of trade payable amounting to Rs. 2,704.87 lakhs which is charged to Statement of Profit & Loss as an exceptional item.

e. During the year, the Company disposed of certain Plant, Property & Equipments. The loss on disposed of the Plant, Property & Equipments amounting to Rs. 19.37 lakhs has been disclosed under exceptional items in the Statement of Profit and Loss, considering the non-recurring nature of the transaction.

f. The company has impaired an unquoted investment amounting to Rs. 5.56 lakhs which is charged to Statement of Profit & Loss as an exceptional item.

g. During the year, the company has realized mutual fund investment and the profit on realisation amounting to Rs. 99.22 lakhs which has been disclosed under exceptional items in the Statement of Profit and Loss.

39. There are no long-term contracts, as on the date of balance sheet, including derivative contracts for which there are any material foreseeable losses.

40. Others:

i) During the year 2019-20, The MP State Electricity Board had issued a "notice of discontinuance of supply" on 11th March, 2020 (against demand raised on 12th Dec 2019) upon the Company demanding as due and payable Rs. 1,286.27 lakhs on account of a revision of the security deposit in terms of Madhya Pradesh Electricity Regulatory Commission (Security Deposit) (Revision-I) Regulations, 2009 ("MERC Regulations") and other energy charges. Appeal filed before the Hon'ble National Company Law Tribunal (NCLT) is pending.

ii) During the year 2019-20, Central Bureau of Investigation carried out search & seizure action at the registered office of the Company and the residence of the erstwhile Directors of the Company on 5th November 2019 from 09.30 AM to 09.00 PM. under section 165 of the Criminal Procedure Code. Based on the inquiry during the search proceedings, further no notice has been received nor any information called for.

iii) During the year 2019-20, the Company has received notice dated 13^th February, 2020 on 26^th February, 2020 from the Ministry of Corporate Affairs further ordering the investigation of books of accounts and papers under section 210(1)(c) of the Companies Act, 2013 and the erstwhile Directors of the Company under section 217(5) of the Companies Act, 2013 have been issued summons to appear before the authorities. The notice has suitably been replied by the Company and upto the date of approval of these financial statements, no further communication, order, or demand has been received from the Ministry of Corporate Affairs. In view of the prolonged absence of any further correspondence, the matter is considered closed, and no further disclosures will be made in the subsequent financial statements unless new development arise.

iv) During the year 2019-20, the Company has received summon dated 6^th November, 2019 from the Directorate of Enforcement ("ED") u/s 37 of the FEMA, 1999 read with Section 131 of the Income Tax Act, 1961 and Section 30 of Code of Civil Procedure, 1908. Summon was issued in matter of GDRs issued by the Company for which a list of documents was being asked to be furnished to them. The notice has suitably been replied by the Company and upto the date of approval of these financial statements, no further communication, order, or demand has been received from the Directorate of Enforcement. In view of the prolonged absence of any further correspondence, the matter is considered closed, and no further disclosures will be made in the subsequent financial statements unless new development arise.

v) During the year 2020-21, the Principal Commissioner of Income Tax (Central), Ludhiana filed an appeal before the Hon'ble High Court of Punjab & Haryana which was heard on 4^th November, 2020 in the matter pertaining to the assessment u/s 153 w.r.s 143(3) of the Income Tax Act, 1961 for the assessment years 2010-11, 2011-12 & 2013-14, which was completed on January 31, 2017 where an amount of INR 28,000 lakhs was demanded from the Company. Appeals that were filed before the CIT (A) on 27^th July, 2017 were decided by the CIT(A) on 29^th December, 2017 against the company. On 2^nd February, 2018, Company filed an appeal before the ITAT, Chandigarh bench against the order of CIT (A) and the same had been decided by the ITAT in the favor of the Company on 28^th February, 2019. Appeal filed before the Hon'ble High Court of Punjab & Haryana is pending adjudication.

As per approved resolution plan, upon settlement of the liabilities, all or any other Government Dues, claims or demands made by, or liabilities or obligations owed or payable to or assessed by, the Governmental Authorities against the Corporate Debtor, whether admitted or not, due or contingent, asserted or unasserted, crystallized or uncrystallised, known or unknown, secured or unsecured, disputed or undisputed, present or future, whether or not set out in the balance sheet of the Company or the profit & loss statements of the Company or the list of creditors, on or prior to the NCLT Approval Date, will be written off in full and subject to the provisions of the Code, the Company, the Resolution Applicant & its future directors shall at no point of time be, directly or indirectly, held responsible or liable in relation thereto (refer note no. 37a).

41.Segment Information: Products and services from which reportable segments derive their revenues: In accordance with Ind AS 108 "Operating Segments", the chief executive officer (CEO) of the Company reported that the company is engaged in the business of manufacturing & processing of textile products i.e. a single business and all business activities revolve around this segment.

Geographical information: The Company operates in two principal geographical areas - India and outside India.

The Company's revenue from continuing operations from external customers by location of operations and information about its non-current assets* by location of assets are detailed below._

42. During the year, lease payment amounting to Rs. 9.35 lakhs (Previous Year Rs. 28.60 lakhs) recognized in Statement of Profit and Loss. Also lease income amounting to Rs. 3.51 lakhs (Previous Year Rs. 19.89 lakhs) recognized in Statement of Profit and Loss.

48. The balances of Trade Receivables, Trade Payables and Advances to Capital & Other Suppliers are subject to confirmation/reconciliation and subsequent adjustments if any. During the year, letters through ordinary post have been sent to various parties with a request to confirm their balances as on 31^st March, 2025 out of which few parties have confirmed their balances to the company.

49. Financial Risk Management: The Company's principal financial liabilities comprises of loans and borrowings, trade and other payables, and other current liabilities. The main purpose of these financial liabilities is to raise finance for the Company's operations. The Company has loans and receivables, trade and other receivables, and cash and short-term deposits that arise directly from its operations. The management of the company has set out the company's overall business strategies and its risk management policy. The Company's overall financial risk management program seeks to minimize potential adverse effects on the financial performance of the company. The company policies include financial risk management policies covering specific areas, such as market risk (including foreign exchange risk, interest risk, liquidity risk and credit risk). Periodic reviews are undertaken to ensure that the company's policy guidelines are complied with.

There has been no change to the company's exposure to the financial risks or the manner in which it manages and measures the risk. The company is exposed to the following risks related to financial instruments. The company has not framed formal risk management policies; however, the risks are monitored by management on a continuous basis. The company does not enter into or trade in financial instruments, investment in securities, including derivative financial instruments, for speculative or risk management purposes.

The Board of Directors reviews and agrees policies for managing each of these risks which are summarized below:

(a) Market Risk: Market risk is the risk that the fair values of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market prices comprise three types of risk: interest rate risk, currency risk and other price risk, such as equity risk. Financial instruments affected by market risk include loans & borrowings and deposits. The sensitivity analyses in the following sections relate to the position as at 31st March, 2025 and 31st March, 2024.

The following assumption has been made in calculating the sensitivity analyses:

i) The sensitivity of the statement of comprehensive income is the effect of the assumed changes in interest rates on the net interest income for one year, based on the average rate of borrowings held during the year ended 31st March, 2024, all other variables being held constant. These changes are considered to be reasonably possible based on observation of current market conditions.

(b) Foreign Currency Risk Management: The Company undertakes certain transactions denominated in foreign currencies. Hence, exposures to exchange rate fluctuations arise.

(c) Liquidity Risk Management: Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company has been taking measures to ensure that the Company's cash flow from business borrowing is sufficient to meet the cash requirements for the Company's operations. The Company managing its liquidity needs by monitoring forecasted cash inflows and outflows in day to day business. Liquidity needs are monitored on various time bands, on a day to day and week to week basis, as well as on the basis of a rolling 30 day projections. Net cash requirements are compared to available working capital facilities in order to determine headroom or any short falls. Presently company's objective is to maintain sufficient cash to meet its operational liquidity requirements.

(d) Credit Risk Management: Credit risk refers to the risk of financial loss to the Company if a counterparty fails to meet its contractual obligations. The Company manages credit risk by implementing a robust framework of credit approvals, setting defined credit limits, and continuously monitoring the creditworthiness of its customers. Credit is granted in the normal course of business only after careful assessment of the customer's financial reliability. With the adoption of Ind AS 109 - Financial Instruments, the Company assesses impairment of financial assets using the

Expected Credit Loss (ECL) model. This approach requires recognition of credit losses based on forward-looking information and the estimation of losses expected over the life of the asset. The Company is exposed to credit risk primarily in relation to its trade receivables arising from the sale of readymade garments, towels, yarns, and from job work activities. Appropriate loss allowances are recognized based on historical trends, credit risk assessments, and management's expectations regarding future recoverability.

(e) Capital Risk Management: The Company's objectives when managing capital is to safeguard the Company's ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. The director's policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business.

No Changes were made in the objectives, policies or processes during the years ended 31st March, 2025 and 31st March, 2024.

54. Pursuant to the Corporate Insolvency Resolution Process, the loan amounts have already been settled under IBC and the Company has been taken over by new management. The Company has been regularly paying interest upto June 2023 and quarterly installments upto June 2023 as per terms of resolution plan. Furthermore, term loan-II of Rs. 50.00 crores has also been repaid in accordance with the terms of resolution plan. Despite the foregoing compliance by the Company, the Company has received a notice from Bank of Maharashtra declaring the name of the Company (under old/previous management prior to liquidation) as willful defaulter on 16.11.2022 in respect of outstanding loan of Rs. 7,285 lakhs. Similarly, the Company has also received a notice from India Exim Bank for appearance before "Willful Defaulter Committee" in earlier year for replying on the willful defaulter notice.

Post implementation of the resolution plan in March, 2021 certain actions were required to be taken sequentially by the resolution applicant, company and the lenders detailed as under:

1. Joint documents for the loans were duly executed between the financial creditors & the Company.

2. Resolution Applicant introduced an amount of Rs. 5,000 lakhs upfront which was used to making payments to financial creditors & operational creditors.

3. Equity Shares and Debentures were allotted by the Company to the financial creditors.

4. Part of Equity Shares allotted to the Resolution Applicant was pledged by the Resolution Applicant with the financial creditors.

5. Term Loan-II of Rs. 4,911 lakhs which was required to be repaid within first year was duly repaid.

6. Resolution Applicant was required to bring in Rs. 6,500 lakhs as working capital out of which Rs. 2,500 lakhs have already been infused.

7. During the intervening period, the financial creditors were required to take the following steps:

i. Removal of the name of the Company from CIBIL List,

ii. Removal of the name of the Company from Fraud List,

iii. Issue a letter for satisfaction of redundant charges of about Rs. 12,000 crores standing in MCA in the name of the Company.

However, the financial creditors have failed to take any steps in this regard except para 7iii despite repeated requests from the Company.

Post implementation of the resolution plan the interest and installments of the Company are being served without any delay upto June 2023. However, due to non-action by the financial creditors as stated above is severely hampering the business of the Company and limiting the capacity of the Resolution Applicant to infuse capital.

55. Further, pursuant to the Corporate Insolvency Resolution Process, the Banks and financial institutions have not taken appropriate action regarding the declassification of the company under the list of Defaulters in the records of RBI, rating agencies, Central Fraud Registry, ECGC, non-cooperative borrower, etc. The same was stipulated to be done within 30 days from the effective date as per the approved resolution plan. The Company filed an application before the Hon'ble National Company Law Tribunal (NCLT), Chandigarh Bench regarding not taking appropriate action by the banks & financial institutions within specific time period in this matter.

Consequently, the Company's performance during the year was sub-optimal and fell significantly short of expectations. The Company encountered numerous challenges that adversely impacted its ability to conduct business operations in a profitable and economically sustainable manner. An analysis of the operational performance indicates that the Company was unable to fully utilize its available capacities, resulting in a continued operational deficit and severe liquidity stress. Several plants remained shut for the majority of the period under review. In an effort to sustain operations and generate revenue, the Company initiated job work activities at one of its units during the year. Despite these efforts, the ongoing financial distress severely impaired the Company's ability to meet its financial obligations, including the payment of interest and servicing of outstanding loans.

The Company has not repaid the quarterly installment due for the period 30^th September, 2023 to 31^st March, 2025 amounting to Rs. 12,128.91 lakhs and also has not paid the monthly interest & other charges due for the period July, 2023 to March, 2025 amounting to Rs. 11,344.96 lakhs. The Company filed an application before the Hon'ble National Company Law Tribunal (NCLT), Chandigarh Bench regarding the issue of declassification etc. as mentioned above. The Hon'ble National Company Law Tribunal (NCLT), Chandigarh Bench has passed an interim ex parte order vide dated 16th August, 2023 with direction, granting a complete moratorium to the company in the payment of amounts as per the plan including payment of deferred amount and interest of term loan and all other payments to the banks, till the next date of hearing. As per said order the Company is also directed to infuse the necessary funds as provided for in the approved resolution plan within a reasonable period after the Banks have complied with direction to declassify the company from various lists as mentioned above.

56. During the financial year 2023-24, due to the default in payment of electricity dues of plant located at Village Mehatwara, Sehore, MP amounting to Rs. 2,244.63 lakhs. The Madhya Pradesh Madhya Kshetra Vidyut Vitaran Co. Limited (MPMPKVV), Bhopal has discontinued the electricity supply. Accordinglying the company has adjusted the security deposit amounting to Rs. 892.60 lakhs against the amount payable in its financial statements during the financial year 2023-24.

Also due to the default in payment of electricity dues of plant located at Village Lal Kalan, Ludhiana amounting to Rs. 85.18 lakhs. The Punjab State Power Corporation Limited (PSPCL) has discontinued the electricity supply. However, the company has not adjusted the security deposit against the amount payable in its financial statements till date.

57. The shareholders of the Company have passed the resolution regarding the Initiation of Corporate Insolvency Resolution Process under Section 10 (including any modification or re-enactment thereof), if any, of the Insolvency and Bankruptcy Code, 2016 in its Extra Ordinary General Meeting held on 13th October, 2023.

58. In accordance with Ind AS 36-Impairment of Assets, the Company has not carried out an impairment assessment of its Property, Plant and Equipment & Capital Work in Progress as at the balance sheet date, due to prevailing financial constraints. The Company's manufacturing facilities remained non-operational for the majority of the units, indicating potential impairment indicators.

59. During the year under consideration, the Company's manufacturing plants remained shut for most of the period due to operational and financial challenges arising out of delays by banks and financial institutions in declassifying the Company from the list of Defaulters, despite an approved resolution plan. In compliance with IND AS16-Property, Plant, and Equipment, the Company has continued to charge depreciation on these idle assets, as they remain within the Company's operational framework and are intended for future use once operations resume.

60. The Company Secretary had resigned from the company on 30th November 2023. In accordance with Section 203 of the Companies Act, 2013, the company initiated the process of filling the vacancy within the prescribed timeframe. However, the company encountered significant challenges in appointing a suitable candidate due to its ongoing financial losses and its recent experience under the Corporate Insolvency Resolution Process (CIRP). These factors led several prospective candidates to decline the offer. Despite these difficulties, the Board of Directors made continuous and diligent efforts to identify a qualified professional and successfully appointed a new Company Secretary on 12th March 2025.

61. As per the provisions of the Companies Act, 2013, the Managing Director is entitled to receive remuneration for their services. However, due to the liquidity stress that the company is currently experiencing, it has become necessary to take certain measures to ensure the financial stability and continuity of the operations. In view of this, the Managing Director has voluntarily decided not to withdraw his remuneration until the financial situation of the company improves.

62. During the year, the Company was in receipt of Cautionary Letters from NSE and BSE pertaining to Risk Management Committee meetings under Regulation 21(3C) of SEBI (LODR) Regulations, 2015.The letters mentioned that the delay in conducting Risk Management Committee meeting, which was in contravention with the provisions of Regulation 21(3C) of SEBI (LODR) Regulations, 2015 and further warned the company to be careful in future and exercise due diligence for complying with the provisions of the Regulations. However, the company has suitably filed the reply for the said letters. There is no impact on financial, operation or other activities of the Company pursuant to the abovementioned cautionary letters.

63. During the year, the Company received notices from the National Stock Exchange (NSE) and BSE Limited regarding non-compliance with certain provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") and Regulation 76 of the SEBI (Depositories and Participants) Regulations, 2018 ("Depository Regulations"). The non-compliance pertained to the requirement of appointing a qualified Company

Secretary as the Compliance Officer for the quarter ended 31^st December, 2024. Consequently, a penalty of Rs. 1.09 lakh was imposed by each exchange. The Company has represented to the stock exchanges that a qualified Company Secretary has been appointed with effect from 12th March, 2025. Owing to the prevailing financial constraints, the Company intends to file a formal request seeking a waiver of the penalties imposed. As the outcome of the waiver request is currently pending and uncertain, no provision for the said penalties has been made in the financial statements for the year.

64. The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

65. The Company does not hold any benami property under the Benami Transactions (Prohibition) Act, 1988 and no proceedings have been initiated or pending against the company under the said Act.

66. One of the trade payables of the Company has filed a petition before the Hon'ble Delhi High Court seeking appointment of an Arbitrator under Section 11 of the Arbitration and Conciliation Act, 1996 to adjudicate the dispute between the parties, in accordance with the arbitration clause incorporated in the invoices raised by the said party. Pursuant to the High Court's order dated 10th July 2024, an Arbitrator has been appointed. As at the reporting date, the matter is pending before the appointed Arbitrator.

67. The Company does not have any borrowings from banks or financial institutions on the basis of security of current assets during the financial year.

68. The Company does not have any transactions with companies struck off under section 248 of the Companies Act, 2013 or section 560 of Companies Act, 1956.

69. No Scheme of Arrangements has been approved by the Competent Authority in terms of sections 230 to 237 of the Companies Act, 2013.

70. During the year, 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 (i) 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 (ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

71. The Company does not have any transaction 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. Further, there were no previously unrecorded income and related assets which were required to be properly recorded in the books of account during the year.

72. During the year 2023-24, The Directorate of Enforcement carried out search, seizure or freezing action at the registered office of the Company on 12th January 2024 under section 17 of the Prevention of Money Laundering Act, 2002 (15 of 2003). Based on the inquiry during the search proceedings, further no notice has been received nor any information called for. In view of the absence of any further correspondence, the matter is considered closed, and no further disclosures will be made in the subsequent financial statements unless new development arise.

73. Trade receivables are presented net of impairment in the Balance Sheet.

75. The Code on Social Security, 2020 ("Code") relating to employee benefits during employment and post employment benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective.

76. Previous year amounts have been reclassified/regrouped wherever necessary to make them comparable and conform to Ind AS presentation.

77. Note No. 1 to 76 forms integral part of the balance sheet and statement of profit &loss.