m) Provisions, contingencies and commitments
A provision is recognized when the Company has a present
obligation as a result of past event, it is probable that an
outflow of resources will be required to settle the obligation,
in respect of which a reliable estimate can be made. Provisions
are not recognized for future operating losses.
Where there are a number of similar obligations, the likelihood
that an outflow will be required in settlement is determined
by considering the class of obligations as a whole. A provision
is recognized even if the likelihood of an outflow with respect
to any one item included in the same class of obligations may
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 recognized as interest expense.
A disclosure for contingent liabilities is made where there is:
(i) a possible obligation that arises from past events and whose
existence will be confirmed only by the occurrence or non¬
occurrence of one or more uncertain future events not wholly
within the control of the entity; or
(ii) a present obligation that arises from past events but is
not recognized because it is not probable that an outflow of
resources embodying economic benefits will be required to
settle the obligation; or the amount of the obligation cannot
be measured with sufficient reliability.
Contingent assets are not recognized in the standalone
financial statements. However, it is disclosed only when an
inflow of economic benefits is probable. Commitments are
future liabilities for contractual expenditure, classified and
disclosed as estimated amount of contracts remaining to be
executed on capital account and not provided for.
n) Employee benefits:(i) Short-term obligations
Liabilities for wages and salaries, including non-monetary
benefits that are expected to be settled wholly within 12
months after the end of the period in which the employees
render the related service are recognized in respect of
employees' services up to the end of the reporting period and
are measured at the amounts expected to be paid when the
liabilities are settled.
(ii) Compensated absences
The Company presents the leave as a current liability in the
balance sheet, to the extent it does not have right to defer its
settlement for twelve months after the reporting date. Where
the Company has the unconditional legal and contractual right
to defer the settlement for a period beyond twelve months,
the same is presented as non-current liability.
(iii) Post-employment obligations
The Company operates the following post-employment
schemes:
(a) defined benefit plan such as gratuity; and
(b) defined contribution plan such as provident fund.
Gratuity obligations
The liability or asset recognized in the balance sheet in respect
of defined benefit gratuity plan is the present value of the
defined benefit obligation at the end of the reporting period
less the fair value of plan assets. The defined benefit obligation
is calculated annually by actuaries using the projected unit
credit method.
The present value of the defined benefit obligation denominated
in INR is determined by discounting the estimated future
cash outflows by reference to market yields at the end of
the reporting period on government bonds that have terms
approximating to the terms of the related obligation.
The net interest cost is calculated by applying the discount
rate to the net balance of the defined benefit obligation and
the fair value of plan assets. This cost is included in employee
benefit expense in the standalone statement of profit and loss.
Remeasurement gains and losses arising from experience
adjustments and changes in actuarial assumptions are
recognized in the period in which they occur, directly in other
comprehensive income. They are included in retained earnings
in the standalone statement of changes in equity and in the
balance sheet.
Defined contribution plan
The Company pays provident fund contributions to publicly
administered provident funds as per local regulations. The
Company has no further payment obligations once the
contributions have been paid. The contributions are accounted
for as defined contribution plans and the contributions are
recognized as employee benefit expense when they are due.
Prepaid contributions are recognized as an asset to the extent
that a cash refund or a reduction in the future payments is
available.
o) Investment in subsidiaries and joint ventures
Investments in subsidiaries and joint ventures are recognised
at cost as per Ind AS 27.
Investments in subsidiaries and joint ventures carried at
cost are assessed for impairment whenever indicators of
impairment exist. The assessment considers, among other
factors, projected cash flows, underlying asset values, project
economics, market conditions and other relevant assumptions.
p) Statement of Cash Flows
The Standalone Statement of Cash flows has been prepared
under indirect method, whereby profit or loss before tax is
adjusted for the effects of transactions of 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 flow from
operating, investing and financing activities are segregated.
q) Financial guarantee contracts
Financial guarantee contracts issued by the Company are
initially recognised at fair value. Where such guarantees are
issued on behalf of subsidiaries without charging a fee, the
fair value is recognised as an investment in the subsidiary
with a corresponding financial liability. Subsequently, financial
guarantee contracts are measured at the higher of the loss
allowance determined under the expected credit loss model
and the amount initially recognised less cumulative income
recognised, where applicable.
At each reporting date, the Company assesses the need for
recognition of expected credit losses considering the credit
profile and repayment capacity of the guaranteed entity.
r) Recent pronouncements
The Ministry of Corporate Affairs (MCA) notifies new standard
or amendments to the existing standards under Companies
(Indian Accounting Standards) Rules as issued from time to
time. For the year ended 31 March 2026, MCA has notified
following amendment to Ind AS, applicable to the Company
w.e.f. 01 April 2025.
Ind AS 21: The Effects of Changes in Foreign Exchange Rates
relating to lack of exchangeability.
Ind AS 12: Income Taxes relating to International Tax Reform
- Pillar Two Model Rules -Exception to recognition and
disclosure of deferred tax.
Ind AS 7: Statement of Cash Flows and Ind AS 107: Financial
Instrument: Disclosures, relating to supplier finance
arrangements.
Ind AS 1: Presentation of Financial Statements relating to
classification of liabilities as current or non- current and non¬
current liabilities with covenants.
The Company has determined that it does not have any
material impact in its standalone financial statements of the
above amendments.
s) New and amended standards
Ind AS 1 - The amendment requires that if a covenant breach is
rectified after the reporting date, the same will be treated as a
non-adjusting event and this amendment will be applicable from
annual reporting periods beginning on or after the 01 April 2026.
The Company does not expect to have a material impact of the
above amendment on the standalone financial statements.
Other accounting policy informationt) Foreign currency transactions(i) Functional and presentation currency
The standalone financial statements are presented in Indian
rupee (^), which is Company's functional and presentation
currency. Functional Currency is the currency of a primary
economic environment in which the Company operates.
(ii) Initial recognition
Transactions in foreign currency are recorded at the exchange
rate prevailing on the date of the transaction. Exchange
differences arising on foreign exchange transactions settled
during the year are recognized in the Standalone Statement of
Profit and Loss for the year.
Foreign exchange differences regarded as an adjustment to
borrowing costs are presented in the Standalone Statement
of Profit and Loss, within finance costs.
(iii) Measurement of foreign currency items at the balance
sheet date
Foreign currency monetary items of the Company are
translated at the closing exchange rates. Non-monetary items
that are measured at historical cost in a foreign currency, are
translated at the exchange rate prevailing on the date of the
transaction. Non-monetary items that are measured at fair
value in a foreign currency are translated using the exchange
rates at the date when the fair value was determined. The
gain or loss arising on translation of non- monetary items
measured at fair value is treated in line with the recognition
of the gain or loss on the change in the fair value of the item.
Exchange differences arising out of these transactions are
recognised in the Standalone Statement of Profit and Loss.
u) Rent
Rental income arising from operating leases on investment
properties is accounted for on a straight line basis over the
lease term agreed with the respective tenant and included in
operating revenue in the standalone statement of profit and
loss due to operating nature.
v) Maintenance income
Income arising from billing of maintenance charges to
tenants/customers is recognised in the period in which the
services are being rendered. A receivable is recognised by
the Company when the services are rendered as this is the
case of point in time recognition where consideration is
unconditional because only the passage of time is required.
Further, the Company considers the terms of the contract and
its customary business practices to determine the transaction
price.
w) Interest
Interest income from a financial asset is recognized when it is
probable that the economic benefits will flow to the Company
and the amount of income can be measured reliably. Interest
income is accrued on a time basis, by reference to the principal
outstanding and at the effective interest rate applicable,
which is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial asset to that
asset's net carrying amount on initial recognition.
x) Forfeiture income
Forfeiture income is recognized on cancellation of unit by
unitholder and when it is probable that the economic benefits
will flow to the Company and the amount of income can be
measured reliably.
y) Dividend income
Dividend income from investments is recognized when the
Company's right to receive payment has been established
(provided that it is probable that the economic benefits
will flow to the Company and the amount of income can be
measured reliably).
z) Profit /Loss from Partnership Firms / Limited Liability
Partnerships (LLP)
Share of profit / loss from firms/ LLPs in which the entity is
a partner is accounted for in the financial period ending
on (or before) the date of the balance sheet on the basis of
standalone financial statements and as per the terms of the
respective partnership deed.
Other income is recognized as and when due or received,
whichever is earlier.
aa) Cash and cash equivalents
Cash and cash equivalents in the balance sheet comprise cash
at banks and on hand and demand deposits with an original
maturity of three months or less and highly liquid investments
that are readily convertible into known amounts of cash and
which are subject to an insignificant risk of changes in value.
For the purpose of statement of cash flows, cash and cash
equivalents consist of cash and short-term deposits, as
defined above, net of outstanding bank overdrafts as they
are considered an integral part of the Company's cash
management.
bb) Impairment of non- financial assets
Assets are reviewed for impairment when indicators exist,
including project delays, regulatory actions, market downturns
or deterioration in expected cash flows. Impairment losses
recognised in prior periods are reversed when there is a
change in estimates used to determine recoverable amount,
except for goodwill.
The Company assesses, at each reporting date, whether there
is an indication that an asset may be impaired. If any indication
exists, or when annual impairment testing for an asset is
required, the Company estimates the asset's recoverable
amount. An asset's recoverable amount is the higher of an
asset's or cash-generating unit's (CGU) fair value less costs of
disposal and its value in use.
Recoverable amount is determined for an individual asset,
unless the asset does not generate cash inflows that are largely
independent of those from other assets or group of assets.
In assessing value in use, the estimated future cash flows are
discounted to their present value using a pre-tax discount rate
that reflects current market assessments of the time value of
money and the risks specific to the asset. In determining fair value
less costs of disposal, recent market transactions are taken into
account. If no such transactions can be identified, an appropriate
valuation model is used. These calculations are corroborated
by valuation multiples, quoted share prices for publicly traded
companies or other available fair value indicators.
cc) Interest income from financial assets
Interest income from debt instruments is recognized using the
effective interest rate method. The effective interest rate is
the rate that exactly discounts estimated future cash receipts
through the expected life of the financial asset to the gross
carrying amount of a financial asset. When calculating the
effective interest rate, the Company estimates the expected cash
flows by considering all the contractual terms of the financial
instrument (for example, prepayment, extension, call and similar
options) but does not consider the expected credit losses.
dd) Offsetting financial instruments
Financial assets and financial liabilities are offset and the net
amount is reported in the balance sheet if there is a currently
enforceable legal right to offset the recognised amounts and
there is an intention to settle on a net basis or to realise the
assets and settle the liabilities simultaneously.
ee) Intangible assets
Intangible assets are carried at cost less accumulated
amortization and impairment losses, if any. The cost of an
intangible asset comprises of its purchase price, including any
import duties and other taxes (other than those subsequently
recoverable from the taxing authorities), and any directly
attributable expenditure on making the asset ready for its
intended use. Subsequent expenditure is capitalized only if it
is probable that the future economic benefits associated with
the expenditure will flow to the Company.
Intangible assets under development (IUD) comprises of direct
cost, related incidental expenses and attributable borrowing
cost, if any, on intangible assets which are not ready for their
intended use. IUD usually pertain to a product development
project which has reached a defined milestone according to an
established project management model and its technological
and economic feasibility is viable. Expenditure on research
activities is recognised in the standalone statement of profit
and loss as incurred. Intangible assets under development
are subject to impairment testing at each reporting date and
assessed for impairment and impairment loss, if any.
ff) Share-based payments
The Company operates equity-settled share based
remuneration plans for its employees. All services received
in exchange for the grant of any share-based payment
are measured at their fair values on the grant date and is
recognised as an employee expense, in the profit or loss
with a corresponding increase in equity, over the period
that the employees become unconditionally entitled to the
options. The increase in equity recognised in connection with
share-based payment transaction is presented as a separate
component in equity under "Employee stock options reserve”.
The amount recognised as an expense is adjusted to reflect
the actual number of stock options that vest. Grant date is
the date when the Company and employees have shared an
understanding of terms and conditions on the arrangement.
Where employees are rewarded using share based payments,
the fair value of employees' services is determined indirectly by
reference to the fair value of the equity instruments granted.
This fair value is appraised at the grant date and excludes
the impact of non-market vesting conditions (for example
profitability and sales growth). All share-based remuneration is
ultimately recognised as an expense in the standalone statement
of profit or loss. If vesting periods or other vesting conditions
apply, the expense is allocated over the vesting period, based
on the best available estimate of the number of share options
expected to vest. Non-market vesting conditions are included in
assumptions about the number of options that are expected to
become exercisable. Estimates are subsequently revised if there
is any indication that the number of share options expected
to vest differs from previous estimates. Any adjustment to
cumulative share-based compensation resulting from a revision
is recognised in the current period. The number of vested
options ultimately exercised by holder does not impact the
expense recorded in any period.
In case of equity-settled share based payments to the
employees of subsidiaries, the Company recognises an asset
in its standalone balance sheet to the extent the expense
is recoverable from the subsidiaries. The impact (expense
or credit) is included in the value of its investment in the
subsidiaries, if such expense or credit is not recoverable from
or refundable to the subsidiaries.
Market conditions are taken into account when estimating the
fair value of the equity instruments granted. Upon exercise
of share options, the proceeds received, net of any directly
attributable transaction costs, are allocated to share capital
up to the nominal (or par) value of the shares issued with any
excess being recorded as share premium.
gg) Contributed equity
An equity instrument is any contract that evidences a
residual interest in the assets of an entity after deducting all
of its liabilities. Equity instruments issued by a Company are
recognized at the proceeds received, net of direct issue costs.
hh) Dividend
The final dividend on shares is recorded as a liability on the
date of approval by the shareholders. Interim dividend is
recognised as a liability on the date of declaration by the
Company's Board of Directors.
ii) Earnings per share
Basic earnings per share is computed by dividing the profit/
(loss) for the year by the weighted average number of equity
shares outstanding during the year. The weighted average
number of equity shares outstanding during the year is adjusted
for treasury shares, bonus issue, and bonus element in a rights
issue to existing shareholders, share split and reverse share split.
Diluted earnings per share is computed by dividing the profit/
(loss) for the year as adjusted for dividend, interest and
other charges to expense or income (net of any attributable
taxes) relating to the dilutive potential equity shares, by the
weighted average number of equity shares considered for
deriving basic earnings per share and the weighted average
number of equity shares which could have been issued on the
conversion of all dilutive potential equity shares. Potential
equity shares are deemed to be dilutive only if their conversion
to equity shares would decrease the net profit per share from
continuing ordinary operations. Potential dilutive equity
shares are deemed to be converted as at the beginning of the
period, unless they have been issued at a later date.
jj) Rounding of amounts
The standalone financial statements and notes are presented
in Indian Rupee (^) and all values are presented in (^) lakhs
and rounded off to the extent of 2 decimals, unless otherwise
stated.
kk) Segment reporting
Operating segments are reported in a manner consistent
with the internal reporting, nature of the products / process,
organization structure as well as differential risks and returns,
provided to the Managing Director, which constitutes as chief
operating decision maker ('CODM').
2.1 Use of estimates and judgements
The preparation of the standalone financial statements, in
conformity with the recognition and measurement principal
of Ind AS, requires the management to make estimates and
assumptions in the application of accounting policies that
affect the reported amounts of assets, liabilities, income,
expenses and disclosures of contingent assets and liabilities
at the date of these standalone financial statements and the
results of operation during the reported period. Although
these estimates are based upon management's best knowledge
of current events and actions, actual results could differ from
these estimates which are recognized in the period in which
they are determined.
The key assumptions concerning the future and other key
sources of estimation uncertainty at the reporting date, that
have a significant risk of causing a material adjustment to
the carrying amounts of assets and liabilities within the next
financial year, are described below. The Company based its
assumptions and estimates on parameters available when the
standalone financial statements were prepared.
Existing circumstances and assumptions about future
developments, however, may change due to market changes
or circumstances arising that are beyond the control of
the Company. Such changes are reflected in the financial
statements in the period in which changes are made and,
if material, their effects are disclosed in the notes to the
standalone fnancial statements.
i. Useful lives of property, plant and equipment and
investment properties
Property, plant and equipment and investment property
represent a significant proportion of the asset base of the
Company. The charge in respect of periodic depreciation is
derived after determining an estimate of an asset's expected
useful life and the expected residual value at the end of its life.
The useful lives and residual values of Company's assets are
determined by the management at the time the asset is acquired
and reviewed periodically, including at each reporting date.
ii. Classification of assets and liabilities into current and
non-current
The management classifies the assets and liabilities into
current and non-current categories based on management's
expectation of the timing of realization of the assets or timing
of contractual settlement of liabilities.
iii. Compensation liability in case of project under
development
The management is required to make estimates of payments
to be made in connection with the temporary accommodation
facilities provided to the tenants and corpus payments for
acquiring land developments rights in case of redevelopment
projects.
iv. Impairment of financial and non- financial assets
In assessing impairment, management estimates the
recoverable amounts of each asset (in case of non-financial
assets) based on expected future cash flows and uses
an estimated interest rate to discount them. Estimation
uncertainty relates to assumptions about future cash flows
and the determination of a suitable discount rate.
v. Fair value measurements of financial instruments
Management applies valuation techniques to determine the
fair value of financial instruments (where active market quotes
are not available). This involves developing estimates and
assumptions consistent with how market participants would
price the instrument. Management bases its assumptions on
observable data as far as possible but this is not always readily
available. In that case, management uses the best information
available. Estimated fair values may vary from the actual
prices that would be achieved in an arm's length transaction at
the reporting date.
vi. Revenue recognition
The Company recognizes revenue from sale of residential
and commercial units (including other fee such as club house
charges etc.) and construction services over the time of
completion of project where criteria of Ind AS 115 are met.
This requires the Company to estimate the efforts or costs
expended to date as a proportion of the total efforts or costs
to be incurred. Efforts or costs incurred have been used to
measure progress towards completion as there is a direct
relationship between input and revenue recognition.
Estimates of total project costs, project revenues,
sales realisations and project timelines are reviewed
periodically and updated prospectively as necessary.
vii. Expected credit loss
The Company applies Expected Credit Losses ("ECU’) model
for measurement and recognition of loss allowance on
the following: • Trade receivables and lease receivables. •
Financial assets measured at amortised cost (other than trade
receivables and lease receivables). • Financial assets measured
at fair value through other comprehensive income (FVTOCI).
In accordance with Ind AS 109 - Financial Instruments,
the Company applies ECL model for measurement and
recognition of impairment loss on the trade receivables or any
contractual right to receive cash or another financial asset
that result from transactions that are within the scope of Ind
AS 115 - Revenue from Contracts with Customers.
For this purpose, the Company follows 'simplified approach'
for recognition of impairment loss allowance on the trade
receivable balances. The application of simplified approach does
not require the Company to track changes in credit risk. Rather,
it recognises impairment loss allowance based on lifetime ECLs
at each reporting date, right from its initial recognition.
As a practical expedient, the Company uses a provision
matrix to determine impairment loss allowance on portfolio
of its trade receivables. The provision matrix is based on its
historically observed default rates over the expected life of
the trade receivables and is adjusted for forward-looking
estimates. At every reporting date, the historical observed
default rates are updated and changes in the forward-looking
estimates are analysed.
In case of other assets, the Company determines if there has
been a significant increase in credit risk of the financial asset
since initial recognition. If the credit risk of such assets has
not increased significantly, an amount equal to twelve months
ECL is measured and recognised as loss allowance. However,
if credit risk has increased significantly, an amount equal to
lifetime ECL is measured and recognised as loss allowance.
viii. Provisions, contingent liabilities, contingent assets and
capital commitments
The Company exercises judgement in determining if a
particular matter is possible, probable or remote. The Company
also exercises judgement in measuring and recognising
provisions and the exposures to contingent liabilities related
to pending litigation or other outstanding claims subject to
negotiated settlement, mediation, government regulation, as
well as other contingent liabilities. Judgement is necessary in
assessing the likelihood that a pending claim will succeed, or
a liability will arise and to quantify the possible range of the
financial settlement. Because of the inherent uncertainty in
this evaluation process, actual losses may be different from
the originally estimated provision. Provisions are reviewed at
each balance sheet date and adjusted to reflect the current
best estimate. If it is no longer probable that the outflow of
resources would be required to settle the obligation, the
provision is reversed.
ix. Share-based payments
Estimating fair value for share-based payment requires
determination of the most appropriate valuation model. The
estimate also requires determination of the most appropriate
inputs to the valuation model including the expected life of the
option, volatility and dividend yield and making assumptions
about them.
x. Recognition of deferred tax assets
In assessing the realizability of deferred income tax assets,
management considers whether some portion or all the
deferred income tax assets will not be realized. The ultimate
realization of deferred income tax assets is dependent upon
the generation of future taxable income during the period
in which the temporary differences become deductible.
Management considers the scheduled reversals of deferred
income tax liabilities, projected future taxable income, and
tax planning strategies in making this assessment. Based
on the level of historical taxable income and projections for
future taxable income over the periods in which the deferred
income tax assets are deductible, management believes that
the Company will realize the benefits of those deductible
differences. The amount of the deferred income tax assets
considered realizable, however, could be reduced in the near
term if estimates of future taxable income during the carry
forward period are reduced.
xi. Defined benefit obligation
The cost and present value of the gratuity obligation and
compensated absences are determined using actuarial
valuations. An actuarial valuation involves making various
assumptions that may differ from actual developments in
the future. These include the determination of the discount
rate, standard rate of inflation, anticipation of future salary
increases, attrition rate and mortality rates. Due to the
complexities involved in the valuation and its long-term
nature, a defined benefit obligation is highly sensitive to
changes in these assumptions. All assumptions are reviewed
at each reporting date.
xii. Accounting for revenue and land cost for projects
executed through joint development arrangements
For projects executed through joint development
arrangements (JDA), the revenue from the development and
transfer of constructed area/revenue sharing arrangement
and the corresponding land/ development rights received
under JDA is measured at the fair value of the estimated
consideration payable or construction service rendered to the
landowner. The fair value is estimated with reference to the
terms of the JDA (whether revenue share or area share) and
the related cost that is allocated to discharge the obligation of
the Company under the JDA. Fair value of the construction is
considered to be the representative fair value of the revenue
transaction and land so obtained. The management is of the
view that the fair value method and estimates are reflective
of the current market condition.
Borrowing costs, pertaining to development of long term
projects during active development, are transferred to
construction work in progress, as part of the cost of the
projects till the time all the activities necessary to prepare
these projects for its intended use or sale are complete.
Fair value and valuation technique of investment property
The Company’s investment properties consists of two class of assets i.e. commercial/ retail mall and residential properties, which have been
determined based on the nature, characteristics and risks of each property. The fair values of the properties reflected are after accounting for
any transfer/ sale/ disposal during the year.
The fair value of investment properties have been determined by external, independent registered property valuers as defined under rule 2 of
Companies (Registered Valuers and Valuation) Rules, 2017, having appropriate recognised professional qualification and recent experience in
the location and category of the property being valued in conjunction with valuer assessment services undertaken by approved valuer.
The Company obtains independent valuation for its investment property at least annually and fair value measurements are categorized as Level
2 and 3 measurement for residential properties and commercial/ retail mall respectively in the fair value hierarchy. The valuation has been
taken considering values arrived using the following methodologies:
(a) Discounted cash flow method, net present value is determined based on projected cash flows discounted at an appropriate rate; or
(b) Sales comparable method, which compares the price or price per unit area of similar properties being sold in the marketplace
Further, inputs used in the above valuation models are as under:
i. The main input used for DCF method is future lease rental, discount rate, escalation and terminal value. The discount rate most generally
employed is Weighted Average Cost of Capital (“WACC”), reflecting an optimal as opposed to actual financing structure.
ii. The main inputs used for prevailing market rate approach are demand and supply, business potential, location and locality, market survey,
Ready Reckoner published by the Government.
The Company has only one class of equity share having a par value of ^ 1 each with an entitlement of one vote per share held. The Company
declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders
in the ensuing Annual General Meeting. In the event of liquidation of the Company, the holder of equity shares will be entitled to receive any
of the remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of
equity shares held by the shareholders.
(i) Money received against share warrants
During the year, the Board of Directors of the Company, at its meeting held on 5 September 2025, approved the issuance of 11,764,705 warrants
on a preferential basis to the Promoter/Promoter Group and Non-Promoter investors, at an issue price of ^425 per warrant, aggregating
^50,000 lakhs (rounded off). The said issuance was approved by the shareholders at the Annual General Meeting held on 30 September 2025.
Each warrant is convertible into one fully paid-up equity share of the Company. The equity shares to be issued upon conversion of warrants
shall rank pari passu with the existing equity shares of the Company. The terms of the warrants satisfy the equity classification criteria under
Ind AS 32 as the instruments involve exchange of a fixed amount of cash for a fixed number of equity shares and do not contain any contractual
obligation to deliver cash or other financial assets.
The warrant holders are entitled to exercise the conversion option at any time within a period of 18 months from the date of allotment. In case
the warrants are not exercised within the stipulated period, the upfront consideration received shall be forfeited.
Pursuant to the above, the Company received ^12,500 lakhs (rounded off) on 5 December 2025, being 25% of the total issue consideration, as
upfront subscription money.
Subsequently, on 23 January 2026, one of the warrant holders exercised its option to convert 352,941 warrants into equity shares. Accordingly,
the Company allotted 352,941 equity shares of face value ^ 1 each at an issue price of ^425 per share, upon receipt of the balance consideration
of ^ 1,124.99 lakhs (being 75% of ^ 1,499.99 lakhs).
The Company has complied with the requirements of section 42 and section 62 of the Act and the rules framed thereunder with respect to the
same.
Nature and purpose of other equity and reserves :
(a) Capital reserve on merger
During merger, the excess of net assets taken over the cost of consideration paid is treated as capital reserve on account of merger. Capital
reserve is usually not distributed as dividends to shareholders.
(b) Securities premium
Securities premium is used to record the premium on issue of financial securities such as equity shares, preference shares, employee stock
options plan/ employee stock option scheme etc. The reserve is utilised in accordance with the provision of the Companies Act, 2013.
(c) Share based payment reserve
Share based payment reserve is used to recognise the fair value of options on the grant date, issued to employees under employee stock
option plan.
(d) General reserve
General reserves are created out of profits and kept aside for general purpose and financial strengthening of the Company, they don’t have
any special purpose to fulfill and can be used for any purpose in future.
(e) Retained earnings
Retained earnings represents the cumulative profits of the Company, effects of measurements of defined benefits obligations and on
derecognition of equity instrument routed through other comprehensive income.
(f) Money received against share warrants
Share Warrants represent the amounts received towards warrants issued by the Company. Each share warrant entitles the holder the right
to subscribe to one equity share of the Company at a pre-determined price within a specified period. Upon the exercise of these warrants,
the underlying equity shares will be allotted, and the amount will be transferred to issued share capital. Any unexercised warrants at the
end of the specified period are subject to forfeiture as per the terms of the issue.
(g) Equity instrument through other comprehensive income
Equity instrument through other comprehensive income represents the revaluation gains/ (losses) which are routed through other
comprehensive income.
37.1 Income Tax department officials conducted a survey under Section 133A of the Income Tax Act, 1961 at the premises of the Company.
The survey proceedings were concluded on 24 December 2021. The Company received demand orders from the Income Tax Department
for an amount of ^ 7,573.13 lakhs for AY 2019-20 to AY 2021-22 in case of Sunteck Realty Limited, ^ 1,664.29 lakhs for AY 2018-19 to
AY 2020-21 and ^ 7,215.00 lakhs for AY 2017-18 to AY 2021-22 in case of erstwhile subsidiaries Skystar Buildcon Private Limited and
Starlight Systems (I) Private Limited respectively which got merged with Sunteck Realty Limited and had filed an appeal before the CIT
(Appeals). During the current year, in case of Skystar Buildcon Private Limited, the CIT (Appeals) has passed favourable orders for AY
2018-19 to AY 2020-21. In case of Starlight Systems (I) Private Limited, the CIT (Appeals) has passed partly favourable orders for AY
2017-18 to AY 2021-22 against which appeal is pending before ITAT. In case of Sunteck Realty Limited, the CIT (Appeals) has passed
favourable orders for AY 2019-20 to AY 2020-21 while partly favourable order for AY 2021-22 against which appeal is pending before
ITAT. The contingent liabilities disclosed in Note 38(ii) includes an amount of ^ 937.55 lakhs relating to the above matters as at 31 March
2026 (31 March 2025: ^ 11,504.95 lakhs).
(v) The Honourable Supreme Court, has passed a decision on 28 February 2019 in relation to inclusion of certain allowances within the scope
of “Basic wages” for the purpose of determining contribution to provident fund under the Employees’ Provident Funds & Miscellaneous
Provisions Act, 1952. The Company, based on legal advice, is awaiting further clarifications in this matter in order to reasonably assess
the impact on its financial statements, if any. Accordingly, the applicability of the judgement to the Company, with respect to the period
and the nature of allowances to be covered, and resultant impact on the past provident fund liability, cannot be reasonably ascertained,
at present.
Note: It is not practicable for the Company to estimate the timings of cash outflows, if any, in respect of the above pending resolution of
the respective proceedings mentioned under i), ii), iii), iv) and v) above. The Company does not expect any reimbursements in respect of
the above contingent liabilities. Future cash outflows in respect of the above are determinable only on receipt of judgments / decisions
pending with various forums / authorities. The Company does not expect any outflow of economic resources in respect of the above and
therefore no provision is made in respect thereof.
(vi) The Company has issued a Standby Letter of Credit (SBLC) amounting to ^ 19,250.00 lakhs (31 March 2025: Nil) on behalf of Sunteck
Lifestyles Limited in favour of a bank for the purpose of banking facility obtain by subsidiary. The said SBLC meets the definition of a
financial guarantee contract in accordance with Ind AS 109. Accordingly, the financial guarantee is initially recognised at its fair value,
which represents the amount that the Company would have charged for issuing a similar guarantee in an arm’s length transaction.
Fair value of financial guarantee contract has been determined using valuation techniques based on market comparable guarantee fees,
adjusted for credit risk and other relevant factors. The amount of SBLC outstanding as at the reporting date is disclosed in Note 43.
The Company has assessed the expected credit loss on such financial guarantee considering the financial position, cash flows and overall
credit profile of the subsidiary and does not expect any material loss as at the reporting date. The maximum exposure to credit risk is
limited to the amount of the guarantee outstanding. Also, Refer note 43.
ESOS scheme 2019
The Nomination and Remuneration Committee, in the previous year, by way of resolution passed by circulation dated 04 October 2024,
granted 336,068 stock options to the eligible employees of the Company, its subsidiaries and joint venture, under Sunteck Realty Limited
Employees’ Stock Option Scheme 2019 (“ESOS 2019”).
The Nomination and Remuneration Committee, in the previous year, in its meeting held on 20 January 2025, granted 2,143 stock options
to the eligible employees of the Company under Sunteck Realty Limited Employees’ Stock Option Scheme 2019 (“ESOS 2019”).
ESOS scheme 2022
The shareholders of the Company in the Annual General Meeting held on 23 September 2022 had approved 'Sunteck Realty Limited
Employees’ Stock Option Scheme 2022’ (ESOS 2022) to issue up to 1,400,000 equity shares of the face value of ^ 1 each of the Company
to the employees of the Company and its subsidiary in terms of ESOS 2022 formulated and approved by the Board of Directors. As at 31
March 2026, no grants have been made under ESOS 2022.
(b) Compensated absences
The Compensated absences cover the Company’s liability for sick and earned leave.
The liability is presented as current, since the Company does not have an unconditional right to defer settlement for any of these
obligations. The expense recognised during the year towards compensated absences is ^57.53 lakhs (31 March 2025: ^185.09 lakhs)
(c) Defined contribution plans
Provident fund
The Company also has certain defined contribution plans. The contributions are made to provident fund in India for employees at the
rate of 12% of basic salary as per regulations. The contributions are made to registered provident fund administered by the government.
The obligation of the Company is limited to the amount contributed and it has no further contractual nor any constructive obligation.
Amount recognised as an expense during the year towards defined contribution plan is ^ 162.62 lakhs (31 March 2025 : ^ 151.62 lakhs).
(d) Post-employment obligations (Gratuity)
(i) The Company provides for gratuity for employees in India as per the provisions of the Code on Social Security, 2020. Employees
are eligible for gratuity upon completion of the contractual period of continuous service as defined under the Code on Social Security,
2020. The level of benefit provided depends on the member’s length of service and salary at the time of retirement/termination age.
The present value of obligation is determined based on actuarial valuation using the projected unit credit method, which recognises
each period of service as rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final
obligation. The plan is not funded by the Company.
(ii) On November 21, 2025, the Government of India notified the four Labour Codes - the Code on Wages, 2019, the Industrial Relations
Code, 2020, the Code on Social Security, 2020, and the Occupational Safety, Health and Working Conditions Code, 2020 - consolidating
29 existing labour laws. The Ministry of Labour & Employment published draft Central Rules and FAQs to enable assessment of the
financial impact due to changes in regulations. Based on internal management assessment and the best information available, and in line
with ICAI guidance, the incremental impact of these changes has been recognised during the financial year ended 31 March 2026. The
Company continues to monitor the finalisation of Central and State Rules and clarifications from the Government on other aspects of
the Labour Code and would provide appropriate accounting effect subsequently on the basis of such developments as needed.
Sensitivity analysis
Description of Risk Exposures: Valuations are performed on certain basic set of pre-determined assumptions which may vary over time. Thus,
the Company is exposed to various risks in providing the above benefit which are as follows:
Interest rate risk:The plan exposes the Company to the risk of fall in interest rates. A fall in interest rates will result in an increase in the
ultimate cost of providing the above benefit and will thus result in an increase in the value of liability.
Liquidity risk:This is the risk that the Company is not able to meet the short term benefit payouts. This may arise due to non availability of
enough cash/cash equivalent to meet the liabilities or holding of illiquid assets not being sold in time.
Salary escalation risk:The present value of the above benefit plan is calculated with the assumption of salary increase rate of plan participants
in future. Deviation in the rate of increase in salary in future for plan participants from the rate of increase in salary used to determine the
present value of obligation will have a bearing on the plan’s liability.
Demographic risk:The Company has used certain mortality and attrition assumptions in valuation of the liability. The Company is exposed to
the risk of actual experience turning out to be worse compared to the assumption.
Regulatory risk:Gratuity benefit is paid in accordance with the requirements of the Payment of Gratuity Act, 1972 (as amended from time to
time).
44 Fair value measurements
(i) Fair value hierarchy
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 participant at the measurement date.
This section explains the judgments 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 are
valued using the closing price as at the reporting period.
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.
(ii) The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair
value hierarchy. It does not include fair value information for financial assets and financial liabilities not measured at fair value if the carrying
amount is reasonable approximation of fair value:
The Company’s activities expose it to market risk, liquidity risk, foreign currency risk and credit risk. In order to minimise any adverse effects
on the financial performance, the Company’s risk management is carried out by a corporate treasury and corporate finance department under
policies approved by the Board of Directors and top management. The Company’s treasury identifies, evaluates and mitigates financial risks
in close cooperation with the Company’s operating units. The Board provides the guidance for the overall risk management, as well as policies
covering specific areas.
This note explains the sources of risks which the entity is exposed to and how the entity manages the risk and the related impact in the financial
statement.
(A) Credit risk
Credit risk arises from the possibility that the counter party may not be able to settle their contractual terms and obligations. To manage this, the
Company periodically assess financial reliability of customers, taking into account the financial condition, current economic trends, and analysis
of historical bad debts and ageing of accounts receivable. Individual risk limits are set accordingly.
The Company considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk
on an ongoing basis through out each reporting period. To assess whether there is a significant increase in credit risk the Company compares the
risk of default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition. It considers reasonable
and supportive forwarding-looking information such as:
i) Actual or expected significant adverse changes in business,
ii) Actual or expected significant changes in the operating results of the counterparty,
iii) Financial or economic conditions that are expected to cause a significant change to the counterparty’s ability to meet its obligations,
iv) Significant changes in the value of the collateral supporting the obligation or in the equity of the third-party guarantees or credit enhancements.
Financial assets are written off when there is no reasonable expectation of recovery, such as a customer failing to engage in a repayment plan
with the Company. Where loans or receivables have been written off, the Company continues to engage in enforcement activity to attempt to
recover the receivable. Where recoveries are made, these are recognized in statement of profit and loss.
Credit risk is managed at Company level.
For other financial assets, the Company assesses and manages credit risk based on internal control and credit management system. The finance
function consists of a separate team who assess and maintain an internal credit management system. Internal credit control and management is
performed on a Company basis for each class of financial instruments with different characteristics.
The Company considers whether there has been a significant increase in credit risk on an ongoing basis throughout each reporting period. It
considers available reasonable and supportive forward-looking information.
Macroeconomic information (such as regulatory changes, market interest rate or growth rates) are also considered as part of the internal credit
management system.
A default on a financial asset is when the counterparty fails to make payments as per contract. This definition of default is determined by
considering the business environment in which entity operates and other macro-economic factors.
The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, credit risk with regards
to trade receivable is almost negligible in case of its residential and commercial sale and rental business. The same is due to the fact that in case of
its residential and commercial sale business, the possession of the units are not handed over till the entire sale proceeds are received. Similarly,
in case of rental business, the Company keeps 3 to 12 months rental as deposit from the occupants (Refer notes 12.2 and 12.5).
Credit risk on cash and cash equivalents and deposits with banks is limited as the Company generally invest in deposits with banks and financial
institutions with high credit ratings assigned by international and domestic credit rating agencies.
For the credit risk on loans, the Company avoids the concentration of credit risk by spreading them over several counterparties with good credit
rating profile and sound financial position. The Company’s exposure and credit ratings of its counterparties are monitored on an ongoing basis.
Based on historical experience and credit profiles of counterparties, the Company does not expect any significant risk of default.
Contract assets represent the Company’s right to consideration for construction and development activities performed and performance
obligations satisfied under customer contracts, where such amounts are not yet certified and/or billed as at the reporting date. Contract
assets are exposed to credit risk to the extent that customers may be unable to fulfil their contractual payment obligations once the right to
consideration becomes unconditional. In accordance with Ind AS 109, the Company assesses impairment on contract assets using the Expected
Credit Loss (ECL) model. Since contract assets do not have contractual due dates, the Company evaluates impairment by considering factors
such as the stage of project execution, expected timing of certification and billing, customer creditworthiness and historical collection patterns.
The Company also performs a specific review of contract assets that remain uncertified or unbilled for extended periods. Such review includes
evaluation of the status of the underlying project, contractual terms, customer correspondence, reasons for delays in certification or billing,
customer approvals, legal enforceability of claims and subsequent realisations, where applicable. Based on the assessment performed,
management believes that the carrying value of the contract assets is recoverable and no material impairment provision is required.
Loans to subsidiaries are primarily provided for acquisition, development and working capital requirements of underlying real estate projects.
Management has assessed recoverability based on project cash flow forecasts, estimated realisable value of project inventories/ development
rights, expected monetisation plans and financial support available within the group. Based on this assessment and considering the strategic
nature of the funding, the expected credit loss on such loans is estimated to be of negligible amount.
(B) Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding to meet
obligations when due. Due to the dynamic nature of the underlying businesses, the Company’s treasury maintains flexibility in funding by
maintaining sufficient cash and bank balances available to meet the working capital requirements. Management monitors rolling forecasts of
the Company’s liquidity position (comprising the unused cash and bank balances along with liquid investments) on the basis of expected cash
flows. This is generally carried out at the Company level in accordance with practice and limits set by the Company. These limits vary to take into
account the liquidity of the market in which the Company operates.
(i) Maturities of financial liabilities
The tables below analyse the Companies financial liabilities into relevant maturity groupings based on their contractual maturities for :
All non-derivative financial liabilities, and 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.
45. Financial risk management (continued)
(ii) Foreign currency risk (unhedged)
The Company operates internationally and is exposed to foreign exchange risk arising from foreign currency transactions, primarily with
respect to the USD. Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a
currency that is not the Company’s functional currency (^). The risk is measured through a forecast of highly probable foreign currency cash
flows. The Company does not cover foreign currency exposure with any derivative instruments. The Company also imports certain materials
which are denominated in USD which exposes it to foreign currency risk. The Company evaluates exchange rate exposure arising from foreign
currency transactions and follows established risk management policies, including minimising cross currency transactions, using natural hedge
to minimise the impact to results of the exchange rate movements. The unhedged exposures are maintained and kept to minimum feasible.
46. Capital management
(a) Risk management
The Company’s objectives when managing capital are to:
1. 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
2. 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.
55. Other statutory information
(i) Utilisation of borrowed funds and share premium
I. 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) except below
# Foreign Exchange Management Act
@ Prevention of Money Laundering Act
* Difference of ^ 1.64 lakhs between investment in Sunteck Lifestyle International Private Limited (SLIPL) by the Company and the loan given
by SLIPL to Sunteck Lifestyle Limited is on account of exchange rate.
(b) Provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries
II. 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
ii. The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for holding
any Benami property.
III. The Company has not been declared willful defaulter by any bank or financial institution or other lender or government or any government
authority.
IV. The Company has complied with the number of layers as prescribed under section 2(87) of the Companies Act, 2013.
V. The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered or discharged
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.)
VI. The Company has not traded or invested in crypto currency or virtual currency during the years ended 31 March 2026 and 31 March 2025.
VII. The Company does not have any charges or satisfaction which is yet to be registered with Registrar of Companies beyond the statutory period.
VIII. There are no transactions or outstanding balances with struck off companies as at and for the years ended 31 March 2026 and 31 March 2025.
IX. The Company has not entered into scheme of arrangement during the current year. Further the effect of the scheme of arrangement
entered during the previous year is in accordance with the scheme.
X. The Company is not required to submit quarterly statements carrying financial information to the banks and financial institution for such
nature of facility obtained by the Company for the years ended 31 March 2026 and 31 March 2025.
XI. The final dividend paid by the Company during the current year in respect of such dividend declared for the previous year and the final
dividend proposed by the Board of Directors for the current year, is in accordance with section 123 of the Act to the extent it applies to
payment of dividend and declaration of dividend, respectively.
XII. The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. The Group (as defined in Core
Investment Companies (Reserve Bank) Directions, 2016) has three (3) Core Investment Companies as part of the Group.
56. Segment reporting
a) Business segment
Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker
(“CODM”).
The Managing Director of the Company has been identified as the CODM as defined by Ind AS 108 Operating Segments. The CODM evaluates
the Company’s performance and allocates resources based on an analysis of various performance indicators.
The Company is primarily engaged in the business of 'Construction and Development of Real Estate projects and allied activities’. The CODM
reviews activities of real estate development, leasing and allied activities as part of an integrated real estate development and monetisation
model. Resource allocation, project funding and performance evaluation are undertaken at an overall real estate portfolio level and not as
separate operating segments. Considering the nature of business, risks and returns, organisational structure and internal financial reporting
systems, the Company’s entire business constitutes a single operating 'reportable’ segment.
The Company’s operations are substantially and primarily conducted within India and therefore there are no separate geographical segments.
b) Entity wide disclosures
For the year ended 31 March 2026 one (1) [31 March 2025: one (1)] customer individually accounted for more than 10% of the total revenue of
the Company.
57 Other non-current financial assets as at 31 March 2026 include ^ 1,402.73 lakhs, representing amount receivable from Kanaka and Associates,
a partnership firm ('Firm’) in which the Company was associated as a partner till 6 October 2020, which is presently under dispute with respect
to alleged illegal sale of the firm’s assets by the other partner. The Company had received arbitration award dated 4 May 2018 in its favour
in respect of this matter which has been further challenged by the other partner in the Hon’ble Bombay High Court, which has neither been
admitted as yet nor any stay granted against the award. Basis the status of the case, favourable arbitration award and legal opinion, Management
is confident of recovering the aforesaid dues and therefore, no provision has been considered necessary at this stage. Further, considering the
dispute, the Company has not accounted for its share of profits or losses for the period from 1 April 2015 till 6 October 2020, as the financial
statements from the partnership firm are not available. Since, there were no operations in the partnership firm since 2015, Management does
not expect the impact of such share of profits or losses, not accounted, to be material.
58 As the Company is engaged in providing infrastructural facilities as specified in Schedule VI to the Act, provisions of section 186 except sub¬
section (1) of the Act are not applicable to the Company.
59 Non-current investments as at 31 March 2026 include ^ 41,012.75 lakhs representing investment in its wholly owned subsidiary, Sunteck
Lifestyle International Private Limited (SLIPL), which had further invested in GGICO Sunteck Limited (GGICO), through its wholly owned
subsidiary, Sunteck Lifestyles Limited (SLL), for development of real-estate project in Dubai.
Sunteck Lifestyles Limited ('SLL’), a wholly owned step down subsidiary of the Company incorporated in Dubai, entered into a Supplemental
Agreement to the Joint Venture Agreement on 27 October 2025 with its joint venture partner and GGICO Sunteck Limited (“GGICO Sunteck”
or “Joint Venture Company”). Further, SLL entered into a Supplemental Joint Development and License Agreement on 27 October 2025 with
its joint venture partner, GGICO Sunteck, Sunteck Mas Real Estate Development LLC (“Sunteck MAS”) and a shareholder of Sunteck MAS.
Following which on 28 October 2025 Project Development Agreement has been executed between Joint Venture Company and Sunteck Mas.
Pursuant to the aforementioned agreements and arrangements with the counter parts, SLL acquired certain critical rights conferring control
over GGICO Sunteck and Sunteck MAS. Accordingly, with effect from 27 October 2025, both GGICO Sunteck and Sunteck MAS became
subsidiaries of SLL and, consequently, step down subsidiaries of the Company in accordance with Ind AS 110.
60 The Ministry of Corporate Affairs (MCA) has prescribed a requirement for companies under the proviso to Rule 3(1) of the Companies (Accounts)
Rules, 2014 inserted by the Companies (Accounts) Amendment Rules 2021 requiring companies, which uses accounting software for maintaining
its books of account, shall use only such accounting software which has a feature of recording audit trail of each and every transaction, creating an
edit log of each change made in the books of account along with the date when such changes were made and ensuring that the audit trail cannot be
disabled and the audit trail has been preserved by the Company as per the statutory requirements for record retention.
The Company uses an accounting software for maintaining its books of account which is operated by a third party software service provider
which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded
in the software at an application level. The 'Independent Service Auditor’s Report on a Description of a Service Organization’s System and the
Suitability of the Design and Operating Effectiveness of Controls’ ('Type 2 report’ issued in accordance with ISAE 3402, Assurance Reports on
Controls at a Service Organisation) does not provide any information regarding the existence, operation, retention or tampering (if any) of the
audit trail feature at database level for the said accounting software. Consequently, the Company is unable to ascertain whether any audit trail
maintained at the database level has been enabled, retained, or safeguarded from tampering.
The audit trail feature at the application level for the said accounting software has not been tampered with and has been preserved by the
Company in accordance with the applicable statutory record retention requirements.
These are the notes referred to in our audit report of even date.
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