Notes to Accounts of Arman Financial Services Ltd.

Mar 31, 2025

3.16 Provisions, contingent liabilities and contingent
assets

A. Provisions

Provisions are recognised when the Company has a
present obligation (legal or constructive) as a result
of past events, and it is probable that an outflow of
resources embodying economic benefits will be required
to settle the obligation, and a reliable estimate can be
made of the amount of the obligation. When the effect
of the time value of money is material, the Company
determines the level of provision by discounting the
expected cash flows at a pre-tax rate reflecting the
current rates specific to the liability. The expense relating
to any provision is presented in the statement of profit
and loss net of any reimbursement.

B. Contingent liability

A possible obligation that arises from past events
and the existence of which will be confirmed only by
the occurrence or non-occurrence of one or more
uncertain future events not wholly within the control
of the Company or; present obligation that arises from
past events where 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
are disclosed as contingent liability and not provided for.

C. Contingent asset

A contingent asset is a possible asset 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 Company. Contingent assets are neither recognised
nor disclosed except when realisation of income is
virtually certain, related asset is disclosed.

3.17 Taxes

A. Current tax

Current tax assets and liabilities for the current and
prior years are measured at the amount expected to
be recovered from, or paid to, the taxation authorities.
Current tax is the amount of tax payable on the taxable
income for the period as determined in accordance with
the applicable tax rates and the provisions of the Income
Tax Act, 1961.

B. Deferred tax

Deferred tax is recognised on temporary differences
between the carrying amounts of assets and liabilities
in the standalone financial statements and the
corresponding tax bases used in the computation of
taxable profit. Deferred tax liabilities and assets are
measured at the tax rates that are expected to apply in
the period in which the liability is settled or the asset
realised, based on tax rates (and tax laws) that have
been enacted or substantively enacted by the end of
the reporting period. The carrying amount of deferred
tax liabilities and assets are reviewed at the end of each
reporting period.

Deferred tax relating to items recognised outside profit
or loss is recognised outside profit or loss (either in other
comprehensive income or in equity).

Deferred tax items are recognised in correlation to the
underlying transaction either in OCI or equity.

Deferred tax assets and liabilities are offset if such items
relate to taxes on income levied by the same governing
tax laws and the Company has a legally enforceable right
for such set off.

C. Goods and services tax paid on acquisition of assets
or on incurring expenses

Expenses and assets are recognised net of the goods
and services tax paid, except when the tax incurred
on a purchase of assets or availing of services is not
recoverable from the taxation authority, in which case,
the tax paid is recognised as part of the cost of acquisition
of the asset or as part of the expense item, as applicable.

The net amount of tax recoverable from, or payable to,
the taxation authority is included as part of receivables
or payables in the balance sheet.

3.18 Earnings per share

Basic earnings per share (“EPS") is computed by dividing
the profit after tax (i.e., profit attributable to ordinary
equity holders) by the weighted average number of
equity shares outstanding during the year.

Diluted EPS is computed by dividing the profit after tax
(i.e. profit attributable to ordinary equity holders) as
adjusted for after-tax amount of dividends and interest
recognised in the period in respect of the dilutive
potential ordinary shares and is adjusted for any other
changes in income or expense that would result from
the conversion of the dilutive potential ordinary shares,
by the weighted average number of equity shares
considered for deriving basic earnings per share as
increased by the weighted average number of additional
ordinary shares that would have been outstanding
assuming the conversion of all dilutive potential ordinary
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. Dilutive potential
equity shares are determined independently for each
period presented. The number of equity shares and
potentially dilutive equity shares are adjusted for share
splits / reverse share splits, right issue and bonus shares,
as appropriate.

3.19 Dividends on ordinary shares

The Company recognises a liability to make cash or
non-cash distributions to equity holders of the Company
when the distribution is authorised and the distribution
is no longer at the discretion of the Company. As per
the Act, final dividend is authorised when it is approved
by the shareholders and interim dividend is authorised
when it is approved by the Board of Directors of the
Company. A corresponding amount is recognised
directly in equity.

Non-cash distributions are measured at the fair
value of the assets to be distributed with fair value
re-measurement recognised directly in equity.

Upon distribution of non-cash assets, any difference
between the carrying amount of the liability and the
carrying amount of the assets distributed is recognised
in the statement of profit and loss.

(a) Capitalised Borrowing Cost: Borrowing Cost Capitalised on Property, Plant and Equipment during the year H Nil (PY.
H Nil).

(b) Contractual Obligations: Refer Note. 31 for disclosure of Contractual Commitments for the acquisition of property,
Plant & Equipment.

(c) Title deeds of immovable property (other than proper taken on lease by duly executed lease agreement) are held in
the name of the company.

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

(e) During the year, the Company revised the useful life of Office Equipment to 5 years from 10 years in line with the
requirements of Schedule II of the Companies Act, 2013. The change has been accounted for prospectively in
accordance with Ind AS 8.

26.1 Employee Benefit Plan:

Disclosure in respect of employee benefits under Ind AS 19 - Employee Benefit are as under:

a) Defined contribution plan:

The Company''s contribution to provident fund and employee state insurance scheme are considered as defined
contribution plans. The Company''s contribution to provident fund and employee state insurance aggregating H181.73
lakhs (Year ended March 31,2024: H124.40 lakhs) has been recognised in the statement of profit and loss under the
head employee benefits expense.

b) Defined benefit plan:

Financial assets not measured at fair value:

The Company operates a defined benefit plan (the “gratuity plan") covering eligible employees. The gratuity plan is
governed by the Payment of Gratuity Act, 1972.

Under the act, employee who has completed five years of service is entitled to specific benefit. The level of benefits
provided depends on the member''s length of service and salary at retirement age/ resignation date.

The defined benefit plans expose the Company to risks such as actuarial risk, investment risk, liquidity risk, market
risk, legislative risk.

These are discussed as follows:

Actuarial risk: It is the risk that benefits will cost more than expected. This can arise due to one of the following reasons:

Adverse salary growth experience: Salary hikes that are higher than the assumed salary escalation will result into
an increase in obligation at a rate that is higher than expected.

Variability in mortality rates: If actual mortality rates are higher than assumed mortality rate assumption than the
gratuity benefits will be paid earlier than expected. Since there is no condition of vesting on the death benefit, the
acceleration of cash flow will lead to an actuarial loss or gain depending on the relative values of the assumed salary
growth and discount rate.

Variability in withdrawal rates: If actual withdrawal rates are higher than assumed withdrawal rate assumption than
the gratuity benefits will be paid earlier than expected. The impact of this will depend on whether the benefits are
vested as at the resignation date.

Investment risk: For funded plans that rely on insurers for managing the assets, the value of assets certified by the
insurer may not be the fair value of instruments backing the liability. In such cases, the present value of the assets is
independent of the future discount rate. This can result in wide fluctuations in the net liability or the funded status if
there are significant changes in the discount rate during the inter-valuation period.

Liquidity risk: Employees with high salaries and long durations or those higher in hierarchy, accumulate significant
level of benefits. If some of such employees resign / retire from the Company, there can be strain on the cash flows.

Market risk: Market risk is a collective term for risks that are related to the changes and fluctuations of the financial
markets. One actuarial assumption that has a material effect is the discount rate. The discount rate reflects the time
value of money. An increase in discount rate leads to decrease in defined benefit obligation of the plan benefits and
vice versa. This assumption depends on the yields on the government bonds and hence the valuation of liability is
exposed to fluctuations in the yields as at the valuation date.

Legislative risk: Legislative risk is the risk of increase in the plan liabilities or reduction in the plan assets due to
change in the legislation/ regulation. The government may amend the Payment of Gratuity Act, 1972, thus requiring
the companies to pay higher benefits to the employees. This will directly affect the present value of the defined benefit
obligation and the same will have to be recognized immediately in the year when any such amendment is effective.

III. Transfers between levels I and II

There has been no transfer in between level I and level II.

IV. Valuation techniques
Loans

The Company has computed fair value of the loans and advances through OCI considering its business model.
These have been fair valued using the base of the interest rate of loan disbursed in the last fifteen days of the year
end which is an observable input and therefore these has been considered to be fair valued using Level 3 inputs.

D Capital:

The Company maintains an actively managed capital base to cover risks inherent in the business and is meeting the capital
adequacy requirements of the local banking supervisor, RBI. The adequacy of the Company''s capital is monitored using,
among other measures, the regulations issued by RBI.

The Company has complied in full with all its externally imposed capital requirements over the reported period. Equity share
capital and other equity are considered for the purpose of Company''s capital management.

D.1 Capital management

The primary objectives of the Company''s capital management policy are to ensure that the Company complies with
externally imposed capital requirements and maintains strong credit ratings and healthy capital ratios in order to support
its business and to maximize shareholder value.

The Company manages its capital structure and makes adjustments to it according to changes in economic conditions
and the risk characteristics of its activities. In order to maintain or adjust the capital structure, the Company may adjust the
amount of dividend payment to shareholders, return capital to shareholders or issue capital securities. No changes have
been made to the objectives, policies and processes from the previous years. However, they are under constant review by
the Board. .

C Measurement of fair values

I. Valuation techniques and significant unobservable inputs

The carrying amounts of financial assets and liabilities which are at amortised cost are considered to be the same as
their fair values as there is no material differences from the carrying values presented.

II. Financial instruments - fair value

The fair value of financial instruments as referred to in note (A) above have been classified into three categories
depending on the inputs used in the valuation technique. The hierarchy gives the highest priority to quoted prices
in active markets for identical assets or liabilities (Level 1 measurements) and lowest priority to unobservable inputs
(Level 3 measurement).

The categories used are as follows:

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices;

Level 2: The fair value of financial instruments that are not traded in active market is determined using valuation
technique which maximizes the use of observable market data and rely as little as possible on entity specific estimates.
If all significant inputs required to fair value on instrument are observable, the instrument is included in level 2; and

Level 3: If one or more of significant input is not based on observable market data, the instrument is included in level 3.

40 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES:

The Company''s principal financial liabilities comprise borrowings and trade payables. The main purpose of these financial
liabilities is to finance the Company''s operations and to support its operations. The Company''s financial assets include loan
and advances, cash and cash equivalents that derive directly from its operations.

The Company is exposed to credit risk, liquidity risk and market risk. The Company''s board of directors has an overall
responsibility for the establishment and oversight of the Company''s risk management framework. The board of directors
has established the risk management committee, which is responsible for developing and monitoring the Company''s risk
management policies. The committee reports regularly to the board of directors on its activities.

The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set
appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems
are reviewed regularly to reflect changes in market conditions and the Company''s activities.

The Company''s risk management committee oversees how management monitors compliance with the Company''s risk
management policies and procedures, and reviews the adequacy of the risk management framework in relation to the
risks faced by the Company.

I Credit Risk

Credit risk is the risk of financial loss to the Company if a customer or counter-party to financial instrument fails to meet its
contractual obligations and arises principally from the Company''s receivables from customers and loans.

The carrying amounts of financial assets represent the maximum credit risk exposure.

Loans and advances:

The Company''s exposure to credit risk is influenced mainly by the individual characteristics of each customer.
However, management also considers the factors that may influence the credit risk of its customer base, including the
default risk associated with the industry.

The risk management committee has established a credit policy under which each new customer is analysed individually for
creditworthiness before the Company''s standard payment and delivery terms and conditions are offered. The Company''s review
includes external ratings, if they are available, financial statements, credit agency information, industry information etc.

An impairment analysis is performed at each reporting date based on the facts and circumstances existing on that date
to identify expected losses on account of time value of money and credit risk. For the purposes of this analysis, the loan
receivables are categorised into groups based on days past due. Each group is then assessed for impairment using the ECL
model as per the provisions of Ind AS 109 - financial instruments.

As per Ind AS 109, Company is required to group the portfolio based on the shared risk characteristics. Company has
assessed the risk and its impact on the various portfolios and has divided the portfolio into following groups.

a TW and LAP Loans
b SME Loans

c Retail Asset Channel Loans

Staging:

As per the requirement of Ind AS 109 general approach all financial instruments are allocated to stage 1 on initial recognition
except originated credit-impaired financial assets which are considered to be under stage 3 on day of origination.

However, if a significant increase in credit risk is identified at the reporting date compared with the initial recognition,
then an instrument is transferred to stage 2. If there is objective evidence of impairment, then the asset is credit impaired
and transferred to stage 3.

The Company considers a financial instrument defaulted and therefore Stage 3 (credit-impaired) for ECL calculations in all
cases when the borrower becomes 90 days past due on its contractual payments

For financial assets in stage 1, the impairment calculated based on defaults that are possible in next twelve months, whereas
for financial instrument in stage 2 and stage 3 the ECL calculation considers default event for the lifespan of the instrument

As per Ind AS 109, Company assesses whether there is a significant increase in credit risk at the reporting date from the
initial recognition. Company has staged the assets based on the Day past dues criteria and other market factors which
significantly impacts the portfolio.

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the
Company. The Company is exposed to credit risk from its operating activities, cash and cash equivalents and other financial
instruments.

Customer credit risk is managed by each business unit subject to the Company''s established policy, procedures and control
relating to the customer credit risk management. Outstanding customer receivables are regularly monitored and taken up on
case to case basis. The Company has adopted a policy of dealing with creditworthy counterparties and obtaining sufficient
collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. The Company''s exposure and
the credit scores of its counterparties are continuously monitored. Credit exposure is controlled by counterparty limits that
are reviewed and approved by the management team on a regular basis. The Company evaluates the concentration of
risk with respect to loan receivables as low, as its customers are located in several jurisdictions representing large number
of minor receivables operating in largely independent markets. The credit risk on cash and bank balances and derivative
financial instruments is limited because the counterparties are banks with high credit ratings assigned by international
credit rating agencies.

EXPECTED CREDIT LOSS FOR LOANS:

The Company considers default in all cases when the borrower becomes 90 days past due on its contractual payments.
''The Expected Credit Loss (ECL) is measured at 12-month ECL for Stage 1 loan assets and at lifetime ECL for Stage 2 and
Stage 3loan assets. ECL is the product of the Probability of Default, Exposure at Default and Loss Given Default.

Marginal probability of default:

PD is defined as the probability of whether borrowers will default on their obligations in the future. Historical PD is derived
from NBFC internal data calibrated with forward looking macroeconomic factors. For computation of probability of default
(“PD"), Vasicek Single Factor Model was used to forecast the PD term structure over lifetime of loans. As per Vasicek model,
given long term PD and current macroeconomic conditions, conditional PD corresponding to current macroeconomic
condition is estimated. Company has worked out on PD based on the last five years historical data.

Marginal probability:

The PDs derived from the Vasicek model, are the cumulative PDs, stating that the borrower can default in any of the
given years, however to compute the loss for any given year, these cumulative PDs have to be converted to marginal PDs.
Marginal PDs is probability that the obligor will default in a given year, conditional on it having survived till the end of the
previous year.

Conditional marginal probability:

As per Ind AS 109, expected loss has to be calculated as an unbiased and probability-weighted amount for multiple
scenarios.

Based on the historical loss experience, adjustments need to be made on the average PD computed to give effect of the
current conditions which is done through management overlay by assigning probability weightages to different scenarios.

LGD:

LGD is an estimate of the loss from a transaction given that a default occurs. Under Ind AS 109, lifetime LGD''s are defined
as a collection of LGD''s estimates applicable to different future periods.

Various approaches are available to compute the LGD. Company has considered workout LGD approach. The following
steps are performed to calculate the LGD:

1) Analysis of historical credit impaired accounts at cohort level.

2) The computation consists of five components, which are:

a) Outstanding balance

b) Recovery amount (discounted yearly) by initial contractual rate.

c) Expected recovery amount (for incomplete recoveries), discounted to reporting date using initial contractual rate.

d) Collateral (security) amount.

The formula for the computation is as below:

% Recovery rate = (discounted recovery amount security amount discounted estimated recovery) / (total POS)

% LGD = 1 - recovery rate

EAD:

As per Ind AS 109, EAD is estimation of the extent to which the financial entity may be exposed to counterparty in the event
of default and at the time of counterparty''s default. Company has modelled EAD based on the contractual and behavioral
cash flows till the lifetime of the loans considering the expected prepayments. Company has considered expected cash
flows for all the loans at DPD bucket level for each of the segments, which was used for computation of ECL. Moreover, the
EAD comprised of principal component, accrued interest and also the future interest for the outstanding exposure.
So discounting was done for computation of expected credit loss.

II Liquid Risk:

Liquidity risk is the risk that the Company will encounter difficulty in meeting its obligations associated with its financial
liabilities. The Company''s approach in managing liquidity is to ensure that it will have sufficient funds to meet its liabilities
when due.

The Company is monitoring its liquidity risk by estimating the future inflows and outflows during the start of the year and
planned accordingly the funding requirement. The Company manages its liquidity by unutilized cash credit facility, term
loans and direct assignment.

The composition of the Company''s liability mix ensures healthy asset liability maturity pattern and well diverse resource mix.
Capital adequacy ratio of the Company, as on 31 March 2025 is 37.34% against regulatory norms of 15%. Tier I capital is
36.59% as against requirement of 10%. Tier II capital is 0.75% which may increase from time to time depending on the
requirement and also as a source of structural liquidity to strengthen asset liability maturity pattern.

The total FDOD & CC limit available to the Company is H377.6 lakhs spread across 2 banks. The utilization level is maintained
in such a way that ensures sufficient liquidity on hand. Majority of the Company''s portfolio is MSME loans which qualifies
as Priority Sector Lending. During the year, the Company has maintained around 5% to 10% of assets under management
as off book through direct assignment transactions. It is with door to door maturity and without recourse to the Company.
This further strengthens the liability management.

The table below summarizes the maturity profile of the Company''s non derivative financial liabilities based on contractual
undiscounted payments along with its carrying value as at the balance sheet date.

III Market risk :

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in
market prices. Market risk includes interest rate risk and foreign currency risk. The objective of market risk management is
to manage and control market risk exposures within acceptable parameters, while optimizing the return.

IV Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes
in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the
Company''s investment in bank deposits and variable interest rate borrowings and lending. Whenever there is a change in
borrowing interest rate for the Company, necessary change is reflected in the lending interest rates over the timeline in
order to mitigate the risk of change in interest rates of borrowings.

K. Details of financing of parent Company products:

This disclosure is not applicable as the Company does not have any holding / parent Company.

L. Details of Single Borrower Limit ("SGL") / Group Borrower Limit ("GBL") exceeded by the NBFC

(i) Loans and advances, excluding advance funding but including off-balance sheet exposures to any single party in
excess of 15 per cent of owned fund of the NBFC: Nil

(ii) Loans and advances to (excluding advance funding but including debentures/bonds and off-balance sheet exposures)
and investment in the shares of single party in excess of 25 per cent of the owned fund of the NBFC: Nil

M. Unsecured Advances

i) Refer Note No. 3 to the financial statements.

ii) The Company has not granted any advances against intangible securities (March 31,2024: Nil)

N. Registration obtained from other financial sector regulators.

The Company is registered with following other financial sector regulators (financial regulators as described by Ministry of
Finance):

i) Ministry of Corporate Affairs

ii) Ministry of Finance

O. Disclosure of penalties imposed by RBI and other regulators.

No penalties imposed by RBI and other regulator during current year and previous year.

51. Previous year''s figures have been regrouped and rearranged wherever necessary, to make them comparable with those
of current year.

52. The Group is not a declared wilful defaulter by any bank or financial Institution or other lender, in accordance with the
guidelines on wilful defaulters issued by the Reserve Bank of India, during the year ended 31 March 2025 and 31 March 2024.

53. The Group does not have any transactions with the companies struck off under section 248 of Companies Act, 2013 or
section 560 of Companies Act, 1956 during the year ended 31 March 2025 and 31 March 2024.

54. All the charges or satisfaction, as applicable are registered with ROC within the statutory period.

55. The Group has taken borrowings from banks and financial institutions and utilized them for the specific purpose for which
they were taken as at the Balance sheet date. Unutilized funds as at 31 March 2025 are held by the Group in the form of
deposits or in current accounts till the time the utilization is made subsequently.

56. There have been no transactions which have not been recorded in the books of accounts, that have been surrendered or
disclosed as income during the year ended 31 March 2025 and 31 March 2024, in the tax assessments under the Income
Tax Act, 1961. There have been no previously unrecorded income and related assets which were to be properly recorded
in the books of account during the year ended 31 March 2025 and 31 March 2024.

57. As a part of normal lending business, the Group grants loans and advances on the basis of security / guarantee provided
by the Borrower/ co-borrower. These transactions are conducted after exercising proper due diligence. Other than the
transactions described above,

(a) No funds have been advanced or loaned or invested by the Group to or in any other person(s) or entity(ies) including
foreign entities (“Intermediaries") with the understanding that the Intermediary shall lend or invest in a party identified
by or on behalf of the Company (Ultimate Beneficiaries);

(b) No funds have been received by the Group from any party(s) (Funding Party) with the understanding that the Group
shall whether, directly or indirectly, lend or invest in other persons or entities identified by or on behalf of the Group
(“Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

58. The Group has not traded or invested in Crypto currency or Virtual Currency during the year ended March 31,2025 and
March 31,2024.

59. The Group has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with Companies
(Restriction on number of Layers) Rules, 2017 for the financial years ended March 31,2025 and March 31,2024.

As per our report of even date attached herewith

For, Arman Financial Services Limited

For, Laxminiwas & Co.

Chartered Accountants

[Firm Regd. No. 011168S]

[Guharoy Ashish Kumar] Jayendra Patel Aalok Patel Vivek Modi

Partner Vice Chairman & Managing Director Joint Managing Director Chief Financial Officer

[M.No. 018659] (DIN - 00011814) (DIN - 02482747)

Place: Ahmedabad

Date: 29^th May, 2025

---

Mar 31, 2024

12.1 Security:

Term Loans & Working Capital Loans are secured under hypothecation of exclusive first charge on specific assets portfolio. The same are further secured by cash collateral security in the form of fixed deposit which are shown under "Other Bank Balance". And refer note 33 for Loans from related parties.

12.2 Interest:

Term loan and Loans repayable on demand from banks carries an interest rate ranging from 10% to 14.25% p.a.

Inter Corporate Deposits carries interest rate @12% p.a.

The Company has not defaulted in repayment of borrowings and interest.

12.3 The Company has borrowed funds from banks and financial institutions on the basis of security of book debts. It has filed quarterly returns or statements of book debts with banks and financial institutions and the said returns/statements are in agreement with books of accounts.

17.4 Shares reserved for issue under options

For details of shares reserved for issue under the Employees Stock Option Plan (ESOP) refer note 41.

17.5 Terms / rights attached to equity shares

(i) In respect of Ordinary Equity Shares having face value of H10/-. Each holder of Ordinary Equity Share is entitled to 1 vote per share.

(ii) In the event of liquidation of the Company, the holders of both type of equity shares will be entitled to receive any of the remaining assets of the Company, after distribution of all preferential amounts. However, no such preferential amounts exist currently. The distribution will be in proportion to the number of equity shares held by shareholders.

18.1 NATURE AND PURPOSE OF RESERVE

1 Reserve u/s 45-IA of the Reserve Bank of India Act, 1934 (the "RBI Act, 1934"):

Reserve u/s. 45-IA of RBI Act, 1934 is created in accordance with section 45 IC(1) of the RBI Act, 1934. As per Section 45 IC(2) of the RBI Act,1934, no appropriation of any sum from this reserve fund shall be made by the NBFC except for the purpose as may be specified by RBI.

2 Securities premium:

Securities premium reserve is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes in accordance with the provisions of section 52 of the Act.

3 Surplus in the statement of profit and loss:

Surplus in the statement of profit and loss is the accumulated available profit of the Company carried forward from earlier years. These reserves are free reserves which can be utilised for any purpose as may be required.

4 FVOCI - loans and advances:

The Company has elected to recognise changes in the fair value of loans and advances in other comprehensive income. These changes are accumulated within the FVOCI - loans and advances reserve within equity.

5 FVOCI - Remeasurement of the defined benefit liabilities:

Remeasurement of the net defined benefit liabilities comprise actuarial gain or loss, return on plan assets excluding interest and the effect of asset ceiling, if any.

6 General reserve:

The Company has transferred a portion of the net profit to general reserve before declaring dividend pursuant to the provision of erstwhile Companies Act.

7 Share Based Payment Reserve:

The Stock option outstanding account is used to recognise the grant date fair value of option issued to employees under employee stock option scheme.

18.2 Disclosures in relation to Compound Instruments:

1 Term of conversion of Compulsory Convertible Debenture

The CCDs shall be converted into equity shares on the earlier of following events:

(i) the Investor electing to convert the CCDs into equity shares by issuing a conversion notice to the Company; and

(ii) the date of expiry of 18 (eighteen) months from the date of allotment of CCDs (28^th September 2022).

It shall be convertible into equity shares at a conversion price of H1,230/- per share at a price being not lower than the minimum price calculated under the SEBI Regulations.

F Terms / rights attached to preference shares

The Company has preference shares having a par value of ? 10/- per share. Preference shares shall carry voting rights as prescribed under the provisions of the Companies Act, 2013 and/or the Articles. The preference share shall carry a cumulative right of dividend at a fixed amount of H123/- (Indian Rupees One Hundred and Twenty Three only) per annum out of the profits of the Company and the payment of such dividend shall have priority over any dividend rights of the equity shares of the Company. The preference shares shall carry a preferential right vis-a-vis equity shares of the Company with respect to payment of dividend and repayment of capital. The OCRPS shall not be entitled to participate in the surplus funds, surplus assets and profits of the Company on winding up, which may remain after the entire capital has been repaid.

G Terms of conversion attached to Optionally Convertible Redeemable Preference shares

The OCRPS, upon issue, will be convertible into equivalent number of equity shares of H10/- (Indian Rupees Ten only) at the option of the Proposed Allottee within a period not exceeding 18 (eighteen) months from the Allotment Date (i.e., 28^th September 2022). The right to seek conversion of the OCRPS can be exercised by the Proposed Allottee, at its discretion, in respect of all or some OCRPS held by it.

H Terms of redemption of preference shares

In the event the Allottee chooses not to convert the OCRPS within 18 (eighteen) months from the Allotment Date, such

OCRPS will be redeemed in the following manner:

(i) At the option of the Proposed Allottee, all or some of the OCRPS can be redeemed, by providing a written notice to the Company within 15 (fifteen) business days from the expiry of 18 (eighteen) months from the Allotment Date.

(ii) If the option under (i) has not been exercised by the Proposed Allottee, then, all or some of the OCRPS can be redeemed at the option of the Proposed Allottee, by providing a written notice to the Company within 15 (fifteen) business days from the expiry of 24 (twenty four) months from the Allotment Date.

(iii) If the option under (i) or (ii) has not been exercised by the Proposed Allottee, then, all but not less than all of the OCRPS shall be compulsorily redeemed by the Company, within a period of 30 (thirty) days from the expiry of 36 (thirty six) months from the Allotment Date.

26.1 Employee Benefit Plan:

Disclosure in respect of employee benefits under Ind AS 19 - Employee Benefit are as under:

a) Defined contribution plan:

The Company''s contribution to provident fund and employee state insurance scheme are considered as defined contribution plans. The Company''s contribution to provident fund aggregating H124.40 lakhs (Year ended March 31,2023: H93.32 lakhs) has been recognised in the statement of profit and loss under the head employee benefits expense.

b) Defined benefit plan:

Financial assets not measured at fair value:

The Company operates a defined benefit plan (the "gratuity plan") covering eligible employees. The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the act, employee who has completed five years of service is entitled

to specific benefit. The level of benefits provided depends on the member''s length of service and salary at retirement age/ resignation date. The defined benefit plans expose the Company to risks such as actuarial risk, investment risk, liquidity risk, market risk, legislative risk. These are discussed as follows:

Actuarial risk: It is the risk that benefits will cost more than expected. This can arise due to one of the following reasons:

Adverse salary growth experience: Salary hikes that are higher than the assumed salary escalation will result into an increase in obligation at a rate that is higher than expected.

Variability in mortality rates: If actual mortality rates are higher than assumed mortality rate assumption than the gratuity benefits will be paid earlier than expected. Since there is no condition of vesting on the death benefit, the acceleration of cash flow will lead to an actuarial loss or gain depending on the relative values of the assumed salary growth and discount rate.

Variability in withdrawal rates: If actual withdrawal rates are higher than assumed withdrawal rate assumption than the gratuity benefits will be paid earlier than expected. The impact of this will depend on whether the benefits are vested as at the resignation date.

Investment risk: For funded plans that rely on insurers for managing the assets, the value of assets certified by the insurer may not be the fair value of instruments backing the liability. In such cases, the present value of the assets is independent of the future discount rate. This can result in wide fluctuations in the net liability or the funded status if there are significant changes in the discount rate during the inter-valuation period.

Liquidity risk: Employees with high salaries and long durations or those higher in hierarchy, accumulate significant level of benefits. If some of such employees resign / retire from the Company, there can be strain on the cash flows.

Market risk: Market risk is a collective term for risks that are related to the changes and fluctuations of the financial markets. One actuarial assumption that has a material effect is the discount rate. The discount rate reflects the time value of money. An increase in discount rate leads to decrease in defined benefit obligation of the plan benefits and vice versa. This assumption depends on the yields on the government bonds and hence the valuation of liability is exposed to fluctuations in the yields as at the valuation date.

Legislative risk: Legislative risk is the risk of increase in the plan liabilities or reduction in the plan assets due to change in the legislation/ regulation. The government may amend the Payment of Gratuity Act, 1972, thus requiring the companies to pay higher benefits to the employees. This will directly affect the present value of the defined benefit obligation and the same will have to be recognized immediately in the year when any such amendment is effective.

VIII Sensitivity analysis

Sensitivity analysis is performed by varying a single parameter while keeping all the other parameters unchanged. Sensitivity analysis fails to focus on the interrelationship between underlying parameters. Hence, the results may vary if two or more variables are changed simultaneously.

IX Asset liability matching strategies

The Company contributes to the insurance fund based on estimated liability of next financial year end. The projected liability statement is obtained from the actuarial valuer.

X Effect of plan on the company''s future cash flows

a) Funding arrangements and funding policy

The Company has purchased an insurance policy to provide for payment of gratuity to the employees. Every year, the insurance company carries out a funding valuation based on the latest employee data provided by the Company. Any deficit in the assets arising as a result of such valuation is funded by the Company.

31 Contingent liabilities not provided for and Commitments:
Particulars	For the year ended March 31, 2024	For the year ended March 31, 2023
(A) Contingent liabilities
Guarantees given on behalf of subsidiary company: (Refer note below)
Amount of guarantees	78,280.00	48,280.00
Amount of loans outstanding	43,955.14	38,212.19
(B) Disputed Demand of Tax
i) Income Tax Act (Company has paid under protest H148.56 Lakhs (P.Y. H177.78 Lakhs), which is shown under "Current Tax Liability (net) / Current Tax Asset (net)"	787.33	613.24
ii) TDS	-	-
(C) Commitments:
Land Acquisition	1,171.00	-
Notes: Guarantees are given by the Company to various banks and Financial Institution on behalf of Subsidiary company for the loan taken and accordingly, the same has been shown as contingent liability.

Reason for shortfall in current year: NA

Nature of CSR activities: To provide financial support for construction of hospital & philanthropic support to the needy people of the society.

33 Leasing Arrangements:

The company has taken various office premises under lease. The lease terms in respect of such premises are on the basis of individual agreement entered into with the respective landlords. All lease agreements are cancellable at the discretion of the lessee i.e. The company by serving a notice to the lessor and hence there are no obligation or commitments with reference to such short-term lease as at reporting date.

34 Segment Reporting:

Operating segment are components of the Company whose operating results are regularly reviewed by the Chief Operating Decision Maker ("CODM") to make decisions about resources to be allocated to the segment and assess its performance and for which discrete financial information is available.

The Company is engaged primarily on the business of "Financing" only, taking into account the risks and returns, the organization structure and the internal reporting systems. All the operations of the Company are in India. All non-current assets of the Company are located in India. Accordingly, there are no separate reportable segments as per Ind AS 108 -"Operating segments".

1. Significant counterparty is defined as a single counterparty or group of connected or affiliated counterparties accounting in aggregate for more than 1% of the NBFC-NDSI''s, NBFC-Ds total liabilities as defined in RBI Circular RBI/2019-20/88 DO R.NBFC (PD) CC .No.102/03.10.001/2019-20 dated November 4, 2019 on Liquidity Risk Management Framework for Non-Banking Financial Companies and Core Investment Companies.

2. Significant instrument/product is defined as a single instrument/product of group of similar instruments/ products which in aggregate amount to more than 1% of the NBFC-NDSI''s, NBFC-Ds total liabilities, as defined in RBI Circular RBI/2019-20/88 DO R.NBFC (PD) CC .No.102/03.10.001/2019-20 dated November 4, 2019 on Liquidity Risk Management Framework for Non-Banking Financial Companies and Core Investment Companies.

3. Total Liabilities has been computed as sum of all liabilities (Total of Balance Sheet less Total Equity).

4. Public funds include funds raised either directly or indirectly through public deposits, inter-corporate deposits (except from associate), deposits from corporates (except from associate), bank finance and all funds received from outside sources such as funds raised by issue of Commercial Papers, debentures etc. but excludes funds raised by issue of instruments compulsorily convertible into equity shares within a period not exceeding 5 years from the date of issue, as defined in Master Direction - Non-Banking Financial Company - Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Direction, 2016.

5. Other short-term liabilities include all short-term borrowings other than Commercial papers and Nonconvertible debentures with original maturity less than one year.

6. The amount stated in this disclosure is based on the audited financial statements for the year ended March 31,2024 and March 31, 2023.

C Measurement of fair values

I. Valuation techniques and significant unobservable inputs

The carrying amounts of financial assets and liabilities which are at amortised cost are considered to be the same as their fair values as there is no material differences from the carrying values presented.

II. Financial instruments - fair value

The fair value offinancial instruments as referred to in note (A) above have been classified into three categories depending onthe inputs used inthe valuation technique.The hierarchy gives the highestpriority to quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and lowest priority to unobservable inputs (Level 3 measurement). The categories used are as follows:

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices;

Level 2: The fair value of financial instruments that are not traded in active market is determined using valuation technique which maximizes the use of observable market data and rely as little as possible on entity specific estimates. If all significant inputs required to fair value on instrument are observable, the instrument is included in level 2; and

Level 3: If one or more of significant input is not based on observable market data, the instrument is included in level 3.

III. Transfers between levels I and II

There has been no transfer in between level I and level II.

IV. Valuation techniques Loans

The Company has computed fair value of the loans and advances through OCI considering its business model. These have been fair valued using the base of the interest rate of loan disbursed in the last fifteen days of the year end which is an observable input and therefore these has been considered to be fair valued using Level 3 inputs.

D Capital

The Company maintains an actively managed capital base to cover risks inherent in the business and is meeting the capital adequacy requirements of the local banking supervisor, RBI. The adequacy of the Company''s capital is monitored using, among other measures, the regulations issued by RBI.

The Company has complied in full with all its externally imposed capital requirements over the reported period. Equity share capital and other equity are considered for the purpose of Company''s capital management.

D.1 Capital management

The primary objectives of the Company''s capital management policy are to ensure that the Company complies with externally imposed capital requirements and maintains strong credit ratings and healthy capital ratios in order to support its business and to maximize shareholder value.

The Company manages its capital structure and makes adjustments to it according to changes in economic conditions and the risk characteristics of its activities. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividend payment to shareholders, return capital to shareholders or issue capital securities. No changes have been made to the objectives, policies and processes from the previous years. However, they are under constant review by the Board.

The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company''s activities.

The Company''s risk management committee oversees how management monitors compliance with the Company''s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company.

I Credit Risk

Credit risk is the risk of financial loss to the Company if a customer or counter-party to financial instrument fails to meet its contractual obligations and arises principally from the Company''s receivables from customers and loans.

The carrying amounts of financial assets represent the maximum credit risk exposure.

Loans and advances:

The Company''s exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, management also considers the factors that may influence the credit risk of its customer base, including the default risk associated with the industry.

The risk management committee has established a credit policy under which each new customer is analysed individually for creditworthiness before the Company''s standard payment and delivery terms and conditions are offered. The Company''s review includes external ratings, if they are available, financial statements, credit agency information, industry information etc.

Tier 1 capital consists of shareholders'' equity and retained earnings. Tier 2 capital consists of general provision and loss reserve against standard assets and subordinated debt (subject to prescribed discount rates and not exceeding 50% of Tier 1).

40 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES:

The Company''s principal financial liabilities comprise borrowings and trade payables. The main purpose of these financial liabilities is to finance the Company''s operations and to support its operations. The Company''s financial assets include loan and advances, cash and cash equivalents that derive directly from its operations.

The Company is exposed to credit risk, liquidity risk and market risk. The Company''s board of directors has an overall responsibility for the establishment and oversight of the Company''s risk management framework. The board of directors has established the risk management committee, which is responsible for developing and monitoring the Company''s risk management policies. The committee reports regularly to the board of directors on its activities.

An impairment analysis is performed at each reporting date based on the facts and circumstances existing on that date to identify expected losses on account of time value of money and credit risk. For the purposes of this analysis, the loan receivables are categorised into groups based on days past due. Each group is then assessed for impairment using the ECL model as per the provisions of Ind AS 109 - financial instruments.

As per Ind AS 109, Company is required to group the portfolio based on the shared risk characteristics. Company has assessed the risk and its impact on the various portfolios and has divided the portfolio into following groups. a TW Loans b SME Loans

c Retail Asset Channel Loans Staging:

As per the requirement of Ind AS 109 general approach all financial instruments are allocated to stage 1 on initial recognition except originated credit-impaired financial assets which are considered to be under stage 3 on day of origination. However, if a significant increase in credit risk is identified at the reporting date compared with the initial recognition, then an instrument is transferred to stage 2. If there is objective evidence of impairment, then the asset is credit impaired and transferred to stage 3.

The Company considers a financial instrument defaulted and therefore Stage 3 (credit-impaired) for ECL calculations in all cases when the borrower becomes 90 days past due on its contractual payments

For financial assets in stage 1, the impairment calculated based on defaults that are possible in next twelve months, whereas for financial instrument in stage 2 and stage 3 the ECL calculation considers default event for the lifespan of the instrument

As per Ind AS 109, Company assesses whether there is a significant increase in credit risk at the reporting date from the initial recognition. Company has staged the assets based on the Day past dues criteria and other market factors which significantly impacts the portfolio.

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The Company is exposed to credit risk from its operating activities, cash and cash equivalents and other financial instruments.

Customer credit risk is managed by each business unit subject to the Company''s established policy, procedures and control relating to the customer credit risk management. Outstanding customer receivables are regularly monitored and taken up on case to case basis. The Company has adopted a policy of dealing with creditworthy counterparties and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. The Company''s exposure and the credit scores of its counterparties are continuously monitored. Credit exposure is controlled by counterparty limits that are reviewed and approved by the management team on a regular basis. The Company evaluates the concentration of risk with respect to loan receivables as low, as its customers are located in several jurisdictions representing large number of minor receivables operating in largely independent markets. The credit risk on cash and bank balances and derivative financial instruments is limited because the counterparties are banks with high credit ratings assigned by international credit rating agencies.

EXPECTED CREDIT LOSS FOR LOANS:

The Company considers default in all cases when the borrower becomes 90 days past due on its contractual payments. ''The Expected Credit Loss (ECL) is measured at 12-month ECL for Stage 1 loan assets and at lifetime ECL for Stage 2 and Stage 3loan assets. ECL is the product of the Probability of Default, Exposure at Default and Loss Given Default.

Marginal probability of default:

PD is defined as the probability of whether borrowers will default on their obligations in the future. Historical PD is derived from NBFC internal data calibrated with forward looking macroeconomic factors. For computation of probability of default ("PD"), Vasicek Single Factor Model was used to forecast the PD term structure over lifetime of loans. As per Vasicek model, given long term PD and current macroeconomic conditions, conditional PD corresponding to current macroeconomic condition is estimated. Company has worked out on PD based on the last five years historical data.

Marginal probability:

The PDs derived from the Vasicek model, are the cumulative PDs, stating that the borrower can default in any of the given years, however to compute the loss for any given year, these cumulative PDs have to be converted to marginal PDs. Marginal PDs is probability that the obligor will default in a given year, conditional on it having survived till the end of the previous year.

Conditional marginal probability:

As per Ind AS 109, expected loss has to be calculated as an unbiased and probability-weighted amount for multiple scenarios. Based on the historical loss experience, adjustments need to be made on the average PD computed to give effect of the current conditions which is done through management overlay by assigning probability weightages to different scenarios.

LGD:

LGD is an estimate of the loss from a transaction given that a default occurs. Under Ind AS 109, lifetime LGD''s are defined as a collection of LGD''s estimates applicable to different future periods.

Various approaches are available to compute the LGD. Company has considered workout LGD approach. The following steps are performed to calculate the LGD:

1) Analysis of historical credit impaired accounts at cohort level.

2) The computation consists of five components, which are:

a) Outstanding balance (POS).

b) Recovery amount (discounted yearly) by initial contractual rate.

c) Expected recovery amount (for incomplete recoveries), discounted to reporting date using initial contractual rate.

d) Collateral (security) amount.

The formula for the computation is as below:

% Recovery rate = (discounted recovery amount security amount discounted estimated recovery) / (total POS) % LGD = 1 - recovery rate

EAD:

As per Ind AS 109, EAD is estimation of the extent to which the financial entity may be exposed to counterparty in the event of default and at the time of counterparty''s default. Company has modelled EAD based on the contractual and behavioral cash flows till the lifetime of the loans considering the expected prepayments. Company has considered expected cash flows for all the loans at DPD bucket level for each of the segments, which was used for computation of ECL. Moreover, the EAD comprised of principal component, accrued interest and also the future interest for the outstanding exposure. So discounting was done for computation of expected credit loss.

Discounting:

As per Ind AS 109, ECL is computed by estimating the timing of the expected credit shortfalls associated with the defaults and discounting them using effective interest rate.

II Liquidity Risk:

Liquidity risk is the risk that the Company will encounter difficulty in meeting its obligations associated with its financial liabilities. The Company''s approach in managing liquidity is to ensure that it will have sufficient funds to meet its liabilities when due.

The Company is monitoring its liquidity risk by estimating the future inflows and outflows during the start of the year and planned accordingly the funding requirement. The Company manages its liquidity by unutilized cash credit facility, term loans and direct assignment.

The composition of the Company''s liability mix ensures healthy asset liability maturity pattern and well diverse resource mix. Capital adequacy ratio of the Company, as on 31 March 2022 is 62.74% against regulatory norms of 15%. Tier I capital is 61.49% as against requirement of 10%. Tier II capital is 1.25% which may increase from time to time depending on the requirement and also as a source of structural liquidity to strengthen asset liability maturity pattern.

The total cash credit limit available to the Company is H385.03 lakhs spread across 2 banks. The utilization level is maintained in such a way that ensures sufficient liquidity on hand. Majority of the Company''s portfolio is MSME loans which qualifies as Priority Sector Lending. During the year, the Company has maintained around 5% to 10% of assets under management as off book through direct assignment transactions. It is with door to door maturity and without recourse to the Company. This further strengthens the liability management.

The table below summarizes the maturity profile of the Company''s non derivative financial liabilities based on contractual undiscounted payments along with its carrying value as at the balance sheet date.

V Foreign currency risk:

The Company does not have any instrument denominated or traded in foreign currency. Hence, such risk does not affect the Company.

41 Stock Option Scheme

The Company has granted stock options to certain employees of the Company under following Employee Stock Option Schemes:

1. ''ARMAN-EMPLOYEE STOCK OPTION PLAN 2016''("ESOP 2016") - instituted, pursuant to the approval of the shareholders of the company at their annual general meeting held on September 22, 2016.

2. ''ARMAN-EMPLOYEE STOCK OPTION PLAN 2023''("ESOP 2023") - instituted, pursuant to the approval of the shareholders of the Company, by way of postal ballot notice dated May 30, 2023.

During the year ended March 31,2024, Company has granted 1,000 new stock options (P.Y. 4,500) and 1,48,600 new stock options (P.Y. Nil) under the scheme of ESOP 2016 and ESOP 2023, respectively.

III Market risk:

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk includes interest rate risk and foreign currency risk. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.

IV Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s investment in bank deposits and variable interest rate borrowings and lending. Whenever there is a change in borrowing interest rate for the Company, necessary change is reflected in the lending interest rates over the timeline in order to mitigate the risk of change in interest rates of borrowings.

44. Disclosures required in terms of Annexure XIV of the RBI Master Direction DNBR. PD. 008/03.10.119/2016-17 dated 1 September 2016 (updated as on 22 February 2019) "Master Direction - Non-Banking Financial Company - Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016 are mentioned as below (Regulatory (Non-IND AS) Information):

I. Exposure To Capital Market

The Company has no exposure to capital market directly or indirectly in the current and previous year.

J. Exposure to Real Estate Sector

The Company has no exposure to real estate sector directly or indirectly in the current and previous year.

K. Details of financing of parent Company products:

This disclosure is not applicable as the Company does not have any holding / parent Company.

L. Details of Single Borrower Limit ("SGL") / Group Borrower Limit ("GBL") exceeded by the NBFC

i) Loans and advances, excluding advance funding but including off-balance sheet exposures to any single party in excess of 15 per cent of owned fund of the NBFC: Nil

ii) Loans and advances to (excluding advance funding but including debentures/bonds and off-balance sheet exposures) and investment in the shares of single party in excess of 25 per cent of the owned fund of the NBFC: Nil

M. Unsecured Advances:

i) Refer Note no. 3 to the financial statements.

ii) The Company has not granted any advances against intangible securities (31 March 2023: Nil).

N. Registration obtained from other financial sector regulators.

The Company is registered with following other financial sector regulators (financial regulators as described by Ministry of Finance):

i) Ministry of Corporate Affairs

ii) Ministry of Finance

O. Disclosure of penalties imposed by RBI and other regulators.

No penalties imposed by RBI and other regulator during current year and previous year.

Q. Remuneration of Directors

Refer Note no. 35 of Financial Statements.

R. Management

The annual report has a detailed chapter on Management Discussion and Analysis.

S. Net Profit of Loss for the period, prior period items and change in accounting policies

There are no such material items which require disclosures in the notes to account in terms of the relevant Ind AS.

T. Revenue Recognition

Refer para no. 3.1 to the accounting policy

U. Ind AS 110 - consolidated financial statements (CFS)

All the subsidiaries of the Company have been consolidated as per Ind AS 110. Refer consolidated financial statements (CFS).

W. Drawn down from Reserves:

There is no draw down from reserves during the year.

X. Concentration of deposits (for deposit taking NBFCs):

Not applicable, as company has not taken any Deposits from public During the Year.

Y. Concentration of advances:

The Company is in Retail Advance Segment hence there is no such substantial Concentration of advances.

Z. Concentration of exposure:

The Company is in Retail Advance Segment hence there is no such substantial Concentration of advances.

AA. Concentration of Stage 3 assets:

The Company is in Retail Advance Segment hence there is no such substantial Concentration of stage 3 assets.

1) As defined in point xxvii of paragraph 3 of Chapter - 2 of these Directions.

2) Provisioning norms are applicable as prescribed in Non-Banking Financial Companies Prudential Norms (Reserve Bank) Directions, 1998.

3) All Ind AS issued by MCA are applicable including for valuation of investments and other assets as also assets acquired in satisfaction of debt. However, market value in respect of quoted investments and break up / fair value / NAV in respect of unquoted investments shall be disclosed irrespective of whether they are classified as long term or current in (5) above.

46. As required in terms of paragraph 13 of Non-Financial Companies Prudential Norms (Reserve Bank) Directions, 2007, schedule to the Balance Sheet of a Non-Banking Financial Company are annexed hereto.

47. Previous year''s figures have been regrouped and rearranged wherever necessary, to make them comparable with those of current year.

48. The Group is not a declared wilful defaulter by any bank or financial Institution or other lender, in accordance with the guidelines on wilful defaulters issued by the Reserve Bank of India, during the year ended 31 March 2024 and 31 March 2023.

49. The Group does not have any transactions with the companies struck off under section 248 of Companies Act, 2013 or section 560 of Companies Act, 1956 during the year ended 31 March 2024 and 31 March 2023.

50. All the charges or satisfaction, as applicable are registered with ROC within the statutory period.

51. The Group has taken borrowings from banks and financial institutions and utilized them for the specific purpose for which they were taken as at the Balance sheet date. Unutilized funds as at 31 March 2024 are held by the Group in the form of deposits or in current accounts till the time the utilization is made subsequently.

52. There have been no transactions which have not been recorded in the books of accounts, that have been surrendered or disclosed as income during the year ended 31 March 2024 and 31 March 2023, in the tax assessments under the Income Tax Act, 1961. There have been no previously unrecorded income and related assets which were to be properly recorded in the books of account during the year ended 31 March 2024 and 31 March 2023.

53. As a part of normal lending business, the Group grants loans and advances on the basis of security / guarantee provided by the Borrower/ co-borrower. These transactions are conducted after exercising proper due diligence. Other than the transactions described above,

(a) No funds have been advanced or loaned or invested by the Group to or in any other person(s) or entity(ies) including foreign entities ("Intermediaries") with the understanding that the Intermediary shall lend or invest in a party identified by or on behalf of the Company (Ultimate Beneficiaries);

(b) No funds have been received by the Group from any party(s) (Funding Party) with the understanding that the Group shall whether, directly or indirectly, lend or invest in other persons or entities identified by or on behalf of the Group ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

54. The Group has not traded or invested in Crypto currency or Virtual Currency during the year ended March 31, 2024 and March 31,2023.

55. The Group has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with Companies (Restriction on number of Layers) Rules, 2017 for the financial years ended March 31,2024 and March 31,2023.

---

Mar 31, 2023

Provisions, contingent liabilities and contingent assets

A. Provisions

Provisions are recognised when the Company
has a present obligation (legal or constructive)
as a result of past events, and it is probable that
an outflow of resources embodying economic
benefits will be required to settle the obligation, and
a reliable estimate can be made of the amount of
the obligation. When the effect of the time value of
money is material, the Company determines the level
of provision by discounting the expected cash flows
at a pre-tax rate reflecting the current rates specific
to the liability. The expense relating to any provision
is presented in the statement of profit and loss net of
any reimbursement.

B. Contingent liability

A possible obligation that arises from past events
and the existence of which will be confirmed only
by the occurrence or non-occurrence of one or more
uncertain future events not wholly within the control
of the Company or; present obligation that arises
from past events where 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 are disclosed as contingent liability and not
provided for.

C. Contingent asset

A contingent asset is a possible asset 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 Company. Contingent assets
are neither recognised nor disclosed except when
realisation of income is virtually certain, related asset
is disclosed.

3.17 Taxes

A. Current tax

Current tax assets and liabilities for the current and
prior years are measured at the amount expected to
be recovered from, or paid to, the taxation authorities.
Current tax is the amount of tax payable on the taxable
income for the period as determined in accordance
with the applicable tax rates and the provisions of the
Income Tax Act, 1961.

B. Deferred tax

Deferred tax is recognised on temporary differences
between the carrying amounts of assets and
liabilities in the standalone financial statements and
the corresponding tax bases used in the computation
of taxable profit.

Deferred tax liabilities and assets are measured at
the tax rates that are expected to apply in the period
in which the liability is settled or the asset realised,
based on tax rates (and tax laws) that have been
enacted or substantively enacted by the end of the
reporting period. The carrying amount of deferred tax
liabilities and assets are reviewed at the end of each
reporting period.

Deferred tax relating to items recognised outside
profit or loss is recognised outside profit or loss
(either in other comprehensive income or in equity).

Deferred tax items are recognised in correlation to
the underlying transaction either in OCI or equity.

Deferred tax assets and liabilities are offset if such
items relate to taxes on income levied by the same
governing tax laws and the Company has a legally
enforceable right for such set off.

C. Goods and services tax paid on acquisition of
assets or on incurring expenses

Expenses and assets are recognised net of the goods
and services tax paid, except when the tax incurred
on a purchase of assets or availing of services is

not recoverable from the taxation authority, in which
case, the tax paid is recognised as part of the cost
of acquisition of the asset or as part of the expense
item, as applicable.

The net amount of tax recoverable from, or payable
to, the taxation authority is included as part of
receivables or payables in the balance sheet.

3.18 Earnings per share

Basic earnings per share ("EPS”) is computed by
dividing the profit after tax (i.e. profit attributable to
ordinary equity holders) by the weighted average
number of equity shares outstanding during the year.

Diluted EPS is computed by dividing the profit after
tax (i.e. profit attributable to ordinary equity holders)
as adjusted for after-tax amount of dividends and
interest recognised in the period in respect of the
dilutive potential ordinary shares and is adjusted for
any other changes in income or expense that would
result from the conversion of the dilutive potential
ordinary shares, by the weighted average number of
equity shares considered for deriving basic earnings
per share as increased by the weighted average
number of additional ordinary shares that would
have been outstanding assuming the conversion
of all dilutive potential ordinary 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. Dilutive potential
equity shares are determined independently for each
period presented. The number of equity shares and
potentially dilutive equity shares are adjusted for
share splits / reverse share splits, right issue and
bonus shares, as appropriate.

3.19 Dividends on ordinary shares

The Company recognises a liability to make cash
or non-cash distributions to equity holders of
the Company when the distribution is authorised
and the distribution is no longer at the discretion
of the Company. As per the Act, final dividend is
authorised when it is approved by the shareholders
and interim dividend is authorised when the it is
approved by the Board of Directors of the Company.
A corresponding amount is recognised directly in
equity. Non-cash distributions are measured at the
fair value of the assets to be distributed with fair
value re-measurement recognised directly in equity.
Upon distribution of non-cash assets, any difference

between the carrying amount of the liability and
the carrying amount of the assets distributed is
recognised in the statement of profit and loss.

4. Standards issued but not yet effective

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. On March 31,2023,
MCA amended the Companies (Indian Accounting
Standards) Rules, 2015 by issuing the Companies
(Indian Accounting Standards) Amendment Rules,
2023, applicable from April 1, 2023, as below:

• Ind AS 1 - Presentation of Financial Statements
The amendments require companies to disclose
their material accounting policies rather than their
significant accounting policies. Accounting policy
information, together with other information, is
material when it can reasonably be expected to
influence decisions of primary users of general
purpose financial statements. The Company does
not expect this amendment to have any significant
impact in its financial statements.

• Ind AS 12 - Income Taxes

The amendments clarify how companies account
for deferred tax on transactions such as leases and
decommissioning obligations. The amendments
narrowed the scope of the recognition exemption
in paragraphs 15 and 24 of Ind AS 12 (recognition
exemption) so that it no longer applies to
transactions that, on initial recognition, give rise to
equal taxable and deductible temporary differences.
The Company is evaluating the impact, if any, in its
financial statements.

• Ind AS 8 - Accounting Policies, Changes in
Accounting Estimates and Errors

The amendments will help entities to distinguish
between accounting policies and accounting
estimates. The definition of a change in accounting
estimates has been replaced with a definition of
accounting estimates. Under the new definition,
accounting estimates are "monetary amounts in
financial statements that are subject to measurement
uncertainty”. Entities develop accounting estimates
if accounting policies require items in financial
statements to be measured in a way that involves
measurement uncertainty. The Company does not
expect this amendment to have any significant
impact in its financial statements.

---

Mar 31, 2018

1.1 The Company has two classes of shares referred to as i) Ordinary equity shares having face value of RS. 10/-. Each holder of equity share is entitled to 1 vote per share and ii) Class “A” ordinary shares having face value of RS. 10/-. Each holder of Class “A” ordinary shares is entitle to one vote for one lakh shares.

1.2 In the event of liquidation of the Company, the holders of both type of equity shares will be entitled to receive any of the remaining assets of the Company, after distribution of all preferential amounts. However, no such preferential amounts exist currently. The distribution will be in proportion to the number of equity shares held by shareholders.

1.3 The Company declares and pays dividends in Indian rupees. The Board of Directors have recommended for the approval of Members a final dividend of RS. 1.00/- per equity share of RS. 10/- each for the Financial Year 2017-18. As per the requirement of Accounting Standard 4 (Revised), the Company has not recognised any provision in financial statements.

1.4 Details of shareholders holding more than 5 % of ordinary shares of the Company are as follows:

@@ Security:

Term Loans are secured under hypothecation of exclusive first charge on specific assets portfolio & personal guarantee of some of the Directors. The same are further secured by cash collateral security in the form of fixed deposit which are shown under “Other Bank Balance”.

Interest:

Secured Term Loan carries an interest rate ranging from 8.35 % to 15.00 % p.a.

Unsecured Term Loan carries an interest rate at 15% p.a.

Repayment:

Term Loan Facilities are repayable in following schedule in monthly / half yearly instalments as follows:-

@ Security:

Working Capital Loans are secured under hypothecation of specific assets portfolio & personal guarantee of some of the directors. The same are further secured by cash collateral security in the form of fixed deposit which are shown under “Other Bank Balance”.

2.1 Unpaid dividend is not due for transfer to investor education and protection fund by the Company.

3.1 Loans secured by hypothecation of assets (vehicles) are secured by hypothecation of the assets (vehicles) under finance. In the opinion of the Board, the market value of the hypothecated assets (vehicle) as on Balance Sheet date is more than the amount of loan outstanding.

3.2 Loans secured by hypothecation of vehicle includes RS. 1,40,78,002/- (P.Y. RS. 91,63,625/-) outstanding portfolio on which NPA provision of RS. 14,07,800/- (P.Y. RS. 9,23,699/-) has been made.

3.3 Deposits includes deposits given as collateral security against loans from financial Institutes.

4.1 Sundry debtors includes RS. 2,15,07,790/-(P.Y. RS. 1,37,24,801/-) outstanding portfolio on which NPA provision of RS. 21,56,848/-(P.Y. RS. 13,80,480/-) has been made.

5.1 Current account with banks includes RS. 19,99,455/- (P.Y. RS. 19,62,913/-) in Unpaid Dividend Account.

5.2 Deposits includes deposits given as cash collateral security against bank loans.

6.1 The disclosure in respect of employee benefit as defined in the accounting standard 15 is given below:

7.1 Bad debts & irrecoverable w/o are shown net off bad debts recovery during the year amounting to RS. 32,70,661/- (P.Y. RS. 6,95,821/-).

7.2 NPA provisions are shown net off NPA provision written back during the year amounting to Rs. Nil (P.Y. Rs. Nil).

8. Contingent liabilities not provided for: -

(a) Disputed Demand of Income Tax of RS. 750.85 Lakhs (Previous year RS. 792.51 Lakhs). (against which the Company has paid RS. 148.56 Lakhs [Previous year RS. 8.79 Lakhs] under protest which are shown as advances).

(b) Guarantee given by Company of RS. 13586.20 Lakhs (P.Y. RS. 6478.53 Lakhs) for working capital / Term Loan taken by its wholly owned subsidiary Company.

9. Related Party Disclosures:

List of Related Parties with whom transactions have taken place during the year:

A) Subsidiary

Namra Finance Limited

B) Key Managerial Personnel

Mr. Jayendra Patel Mr. Aalok Patel

Mr. Amit Manakiwala (Up to 31st August 2017)

10. Stock Option Scheme

The Company has instituted ‘ARMAN-EMPLOYEE STOCK OPTION PLAN 2016’ (“ESOP 2016”), pursuant to the approval of the shareholders of the company at their annual general meeting held on 22.09.2016.

During the year ended March 31, 2018, Company has granted 97,500 stock options (out of total 1,25,000 option available for being granted to eligible employees of the Company / Subsidiary Company/ies) to various employees of Company/ subsidiary Company on 26.05.2017 under the scheme of ‘ARMAN-EMPLOYEE STOCK OPTION PLAN 2016’ (“ESOP 2016”). The details are as under:

11. Balances are subject to confirmation.

12. Borrowing costs attributable to the acquisition or construction of qualifying assets amounting to Rs. Nil (P. Y. Rs. Nil)

(ii) As per Master Circulars - “Miscellaneous Instructions to all Non-Banking Financial Companies” dated July’1, 2015 (updated as on April 11, 2016) vide ref. no. RBI/2015-16/107 DNBR (PD) CC.No.056/03.10.119/2015-16 any profit / premium arising on account of securitization of loans should be amortized over the life of the securities issued or to be issued by the SPV. The amount of profit received in cash may be held under an accounting head styled as “Cash Profit on Loan Transfer Transactions Pending Recognition” maintained on individual transaction basis. The amortization of cash profit arising out of securitization transaction will be done at the end of every financial year.

13. Lease:

The Company has entered into certain rent agreements and amounts of RS. 17.62 Lakhs (P.Y. RS. 7.81 Lakhs) paid under such agreements have been charged to the statement of profit and Loss. These rents agreements are generally not cancellable and are renewable by mutual consent on mutually agreed terms. There are no restrictions imposed by such agreements.

14. During the year, the Company has impaired the assets to the tune of Rs. Nil (P.Y. Rs. Nil).

15.In the opinion of the Board, current assets and loans and advances, are approximately of the value stated, if realized in ordinary course of business.

16 .As per the prudential norms of the Reserve Bank of India, provision has been made in the accounts for the Non Performing Assets. Income is not recognised in respect of Non-Performing Assets.

17. As required in terms of paragrapRs. 13 of Non-Financial Companies Prudential Norms (Reserve Bank) Directions, 2007, schedule to the Balance Sheet of a Non-Banking Financial Company are annexed hereto.

18 .Additional disclosures required by the RBI A) Capital to risk assets ratio (CRAR)

C) Derivatives

The Company has no transactions /exposures in derivatives in the current year and previous year. Un-hedge foreign currency exposure as on 31st March, 2018 is Rs. Nil (P.Y. is Rs. Nil).

D) Disclosure relating to securitization

The Company has entered in to transaction of Securitization (Sales) of RS. 18,00,96,178/- and previous years (Sales) of RS. 13,52,50,000/-.

E) Details of non-performing assets purchase / sold

The Company has not purchased/sold non performing financial assets in the current and previous year.

F) Assets Liability Management

Maturity pattern of certain Assets and Liability as on 31.03.2018

G) Exposure

The Company has no exposure to real estate sector and capital market directly or indirectly in the current and previous year.

H) Details of financing of parent Company products:

This disclosure is not applicable as the Company does not have any holding / parent Company.

I) Registration obtained from other financial sector regulators.

The Company is registered with following other financial sector regulators (financial regulators as described by Ministry of Finance):

a) Ministry of Corporate Affairs

b) Ministry of Finance

J) Disclosure of penalties imposed by RBI and other regulators.

No penalties imposed by RBI and other regulator during current year and previous year.

K) Rating assigned by credit rating agencies and migration of ratings during the year

19. Previous year’s figures have been regrouped and rearranged wherever necessary, to make them comparable with those of current year.

---

Mar 31, 2016

1. RELATED PARTY DISCLOSURES :

Unsecured Loan repayments includes

Paid to Shri Jayendra Patel Rs.Nil (PY. Rs. 9,33,904), to Smt. Ritaben J. Patel Rs.Nil (PY. Rs. 2,59,493), to Shri Aalok Patel Rs.Nil (PY. Rs. 2,59,370), to Aaksh Patel (HUF) Rs.6,39,204 (PY. Rs. 2,98,623), to Namra Holdings & Consultancy Services Pvt. Limited Rs.Nil (PY. Rs. 1,24,438), to Chinubhai R. Shah (HUF) Rs.12,05,425 (PY Rs. 9,23,238), to Namra Finance Limited Rs.70,86,15,216 (PY Rs. Nil)

Unsecured Loan granted includes

Paid to Namra Finance Limited Rs.27,06,85,830 (PY. Rs. 31,25,37,802).

Unsecured Loan received back includes

Received from Namra Finance Limited Rs.28,36,99,353 (PY. Rs. 32,79,14,263).

Interest Income includes

Received from Namra Finance Limited Rs.65,64,866 (PY. Rs. 1,03,53,560).

Interest Expenses includes paid to Shri Jayendra Patel Rs. Nil (P.Y. Rs. 33,904), to Shri Aalok Patel Rs. Nil (PY. Rs. 9,370), to Smt. Ritaben J Patel Rs. Nil (P.Y. Rs. 9,493), to Aakash Patel (HUF) Rs.1,42,047 (P.Y. Rs. 91,777), to Namra Holdings & Consultancy Services Pvt. Limited Rs. Nil (P.Y. Rs. 4,438) to C.R. Shah Rs. 5,425 (P.Y. Rs.12,32,38), Namra Finance Limited Rs.31,58,084 (P.Y.Rs. Nil).

Remuneration and perquisites includes payment to Shri Jayendrabhai Patel Rs.15,55,000 (P.Y. Rs. 15,32,600) and to Shri Amit Manakiwala Rs.10,70,000 (P.Y. Rs. 9,50,000), to Shri Aalok Patel Rs.4,83,600 (P.Y. Rs. 5,11,100)

Sitting Fees included paid to Smt. Ritaben Patel Rs. 37,500 (P.Y. Rs. 37,500).

Rent includes paid to J B Patel & Co. Rs. 20240 (P.Y. Rs. 20240) and to Ritaben Patel Rs. 95,25,560 (P.Y. Rs. 5,55,660)

Dividend Paid includes paid to Shri Aalok Patel Rs.2,96,976 C 2,47,480), to Jayendrabhai Patel HUF Rs.2,35,200 (P.Y. Rs.1,96,000), to Shri Aakash Patel Rs. 3,34,596 (P.Y. Rs.2,47,480), to Shri Jayendrabhai Patel Rs.3,40,690 (PY. Rs. 2,83,908), to Smt. Ritaben Patel Rs. Nil 3,56,009 (P.Y. Rs. 2,78,830), to Namra Holdings & Cons. Services Pvt. Limited Rs.1,98,480 (PY. Rs. 1,65,400), to Shri Amitbhai Manakiwala Rs. 2,32,804 (PY. Rs. 1,94,003), to Smt. Himani Manakiwala Rs.60,000 (P.Y. Rs. 50,000),to Maulik A Manakiwala Rs.960 (P.Y. Nil), Namra Holdings & Consultancy Services Pvt. Limited Rs. 1,98,480 (P.Y. Rs. 1,65,400).

Investments in Subsidiary Company includes investment into Namra Finance Limited Rs. 42,18,750 (P.Y. Rs. Nil).

Purchase of Receivables under Securitization included transaction with Namra Finance Limited of Rs. 24,42,88,000 /- (P.Y. Rs. 22,31,50,400)

2. Balances are subject to confirmation.

3. Borrowing costs attributable to the acquisition or construction of Qualifying Assets amounting to Rs. Nil (P. Y. Rs. Nil)

4. LEASE:

The Company has entered into certain rent agreements and amounts of Rs 16.60. Lacs (PY. Rs. 15.92 Lacs) paid under such agreements have been charged to the Statement of Profit and Loss. These rents agreements are generally not non-cancellable and are renewable by mutual consent on mutually agreed terms. There are no restrictions imposed by such agreements.

5. During the year, the company has impaired the assets to the tune of Rs. Nil (PY. Rs. Nil).

6. In the opinion of the Board, Current assets and loans and advances, are approximately of the value stated, if realized in ordinary course of business.

7. As per the prudential norms of the Reserve Bank of India, provision has been made in the accounts for the Non Performing Assets. Income is not recognized in respect of Non Performing Assets.

8. ADDITIONAL DISCLOSURES REQUIRED BY THE RBI

C) Derivatives

The company has no transactions /exposures in derivatives in the current year and previous year. Un-hedge foreign currency exposure as on 31st March, 2016 is Rs. Nil (P.Y. is Rs. Nil).

D) Disclosure relating to securitization

The company has no transactions of securitization in the current year and previous year.

E) Details of non-performing assets purchase / sold.

The company has not purchased/sold non performing financial assets in the current and previous year.

G) Exposure

The company has no exposure to real estate sector and capital market directly or indirectly in the current and previous year.

H) Details of financing of parent company products:

This disclosure is not applicable as the company does not have any holding / parent company.

I) Registration obtained from other financial sector regulators.

The company is registered with following other financial sector regulators (financial regulators as described by Ministry of Finance):

(i) Ministry of Corporate Affairs

(ii) Ministry of Finance

9. Previous year''s figures have been regrouped and rearranged wherever necessary, to make them comparable with those of current year.

---

Mar 31, 2015

1. Contingent liabilities not provided for: -

(a) Disputed Demand of Income Tax Rs,42.06 Lacs (Previous year Rs,17.12 Lacs) (Against which the Company has paid Rs, Nil [Previous year Rs,11.41 Lacs] under protest which are shown as advances).

(b) Guarantee given by company of Rs,3800 Lacs (P.Y. Rs,2200 Lacs) for Working Capital / Term Loan taken by its subsidiary company.

2. Related Party Disclosures : (contd.)

List of Transaction, out of the transaction reported in the above table, where the transaction entered in to with single party exceeds 10 % of the total related party transactions of similar nature are as under:

Unsecured Loan taken includes

Taken from Shri Jayendra Patel Rs,900000 (P.Y. Rs,5085000), from Smt. Rs,imani A. Manakiwala Rs,Nil (P.Y. Rs,1300000), from Smt. Ritaben J. Patel Rs,250000 (P.Y. Rs,1487500), from Shri Aalok J. Patel Rs,250000 (P.Y Rs,3050000), from Jayendra Patel (HUF) H Nil (P.Y. Rs,2675000) , from Namra Holdings & Consultancy Services Pvt. Limited Rs,120000 (P.Y. Rs,1965000), from Shri Aakash J. Patel ( HUF ) Rs,680000 (P.Y. Rs,2375000).

Unsecured Loan repayments includes

Paid to Shri Jayendra Patel Rs,9 33 904 (P.Y. Rs,5576248), to Smt. Himani A. Manakiwala H Nil (P.Y. Rs,1426409), to Smt. Ritaben J. Patel Rs,259493 (P.Y. Rs,1793825), to Shri Aalok Patel Rs,2 59 370 (P.Y. Rs,3443157), to Aakash Patel (HUF) Rs,2 98 623 (P.Y. Rs,2438618), to Amit Manakiwala(HUF) H Nil (P.Y. Rs,1512271), to Jayendra Patel (HUF) H Nil (P.Y. Rs,3000229), to Namra Holdings & Consultancy Services Pvt. Limited H124438 (P.Y. Rs,2206101), to Chinubhai R. Shah (HUF) Rs,923238 (P.Y. Rs,125310).

Unsecured Loan granted includes

Paid to Namra Finance Limited Rs,312537802 (P.Y. Rs,404042640).

Unsecured Loan received back includes

Received from Namra Finance Limited Rs,327914263 (P.Y. Rs,405794793).

Interest Income includes

Received from Namra Finance Limited Rs,10353560 (P.Y. Rs,13223711).

Interest Expenses includes

paid to Shri Jayendra Patel Rs,33904 (P.Y. Rs,491218), to Shri Aalok Patel H9370 (P.Y. Rs,393157), to Smt. Ritaben J Patel Rs,9493 (P.Y. Rs,306325), to J B Patel (HUF) Rs, Nil (P.Y. Rs,325229), to Aakash Patel (HUF) Rs,91777 (P.Y. Rs,263618), to Smt. Himani Manakiwala Rs, Nil (P.Y. Rs,126409), to Namra Holdings & Consultancy Services Pvt. Limited Rs,4438 (P.Y. Rs,241101) to C.R. Shah 123238 (125310).

Remuneration and perquisites includes

payment to Shri Jayendrabhai Patel Rs,1532600 (P.Y. Rs,1532600) and to Shri Amit Manakiwala Rs,950000 (P.Y. Rs,900000), to Shri Aalok Patel Rs,511100 (P.Y. Rs,549600)

Sitting Fees included

paid to Smt. Ritaben Patel Rs,37500 (P.Y. Rs,50000)

Rent includes

paid to J B Patel & Co. Rs,20224 (P.Y. Rs,20224) and to Smt. Ritaben Patel Rs,555660 (P.Y. Rs, Nil)

Dividend Paid includes

paid to Shri Aalok Patel Rs,247480 (Rs,197984), to Jayendrabhai Patel HUF Rs,1 96 000 (P.Y. Rs,156800), to Shri Aakash Patel Rs,247480 (P.Y. Rs,223064), to Shri Jayendrabhai Patel Rs,283908 (P.Y. Rs,226355), to Smt. Ritaben Patel Rs,278830 (P.Y. Rs,237339), to Namra Holdings & Cons. Services Pvt. Limited Rs,165400 (P.Y. Rs,132320), to SRs,ri Amitbhai Manakiwala Rs,194003. (P.Y. Rs,155202), to Smt. Himani Manakiwala Rs,50000 (P.Y. Rs,40000).

Investments in Subsidiary Company includes

investment into Namra Finance limited Rs, Nil (P.Y. Rs,50000000).

Purchase of Receivables under Securitization included

transaction with Namra Finance limited of Rs,223150400/- (P.Y. 49500000)

3. Balances are subject to confirmation.

4. Borrowing costs attributable to the acquisition or construction of Qualifying Assets amounting to Rs, Nil (P. Y. Rs, Nil)

5. Share Application Money forfeited during the year and transferred to General Reserve of Rs, Nil (P.Y. Rs,14.99 Lacs).

6. Lease:

The Company has entered into certain rent agreements and amounts of Rs,15.92 Lacs (P.Y. Rs,22.99 Lacs) paid under such agreements have been charged to the Statement of Profit and Loss. These rents agreements are generally not non-cancellable and are renewable by mutual consent on mutually agreed terms. There are no restrictions imposed by such agreements.

7. During the year, the company has impaired the assets to the tune of Rs, Nil (P.Y. Rs, Nil).

- In the opinion of the Board, Current assets and loans and advances, are approximately of the value stated, if realized in ordinary course of business.

8. As per the prudential norms of the Reserve Bank of India, provision has been made in the accounts for the Non Performing Assets. Income is not recognized in respect of Non Performing Assets.

9. As required in terms of Paragraph 13 of Non-Financial Companies Prudential Norms (Reserve Bank) Directions, 2007, schedule to the Balance Sheet of a Non-Banking Financial Company are annexed hereto.

A) Details of non-performing assets purchase / sold.

The company has not purchased/sold non performing financial assets in the current and previous year.

B) Exposure

The company has no exposure to real estate sector and capital market directly or indirectly in the current and previous year.

C) Details of financing of parent company products:

This disclosure is not applicable as the company does not have any holding / parent company.

D) Registration obtained from other financial sector regulators.

The company is registered with following other financial sector regulators (financial regulators as described by Ministry of Finance):

(E) Ministry of Corporate Affairs (ii) Ministry of Finance

F) Disclosure of penalties imposed by RBI and Other regulators.

No penalties imposed by RBI and other regulator during current year and previous year.

Previous year's figures have been regrouped and rearranged wherever necessary, to make them comparable with those of current year.-

---

Mar 31, 2014

1. The Company has two classes of shares referred to as i) Ordinary Equity shares having face value of Rs. 10/-. Each Holder of Equity Share is entitled to 1 vote per share and ii) Class "A" Ordinary Shares having face value of Rs. 10/-. Each Holder of Class "A" Ordinary Shares is Entitle to one Vote for one lac Shares.

2. In the event of liquidation of the Company, the holders of both type of Equity shares will be entitled to receive any of the remaining assets of the company , after distribution of all preferential amounts. However, no such preferential amounts exist currently The distribution will be in proportion to the number of Equity shares held by shareholders.

3. The Company declares and pays dividends in Indian Rupees. The Dividend proposed by the Board of Director is subject to the approval of the shareholders in the ensuing Annual General Meeting.

4. During the year ended 31st March2014, the amount of per share dividend recognised as distribution to equity shareholders was Rs. 81,01,498/-(Rs.1.00). The Total dividend appropriation for the year ended 31st March,2014 amounted Rs. 69,24,653/-(PY Rs. 45,19,115/-) excluding corporate dividend tax of Rs. 11,76,845/- (P.Y. 7,68,023/-).

Interest:

Term Loan carries an interest rate ranging from @ 8.25 % to @ 16.25 % p.a. Vehicle Loan carries an interest rate @ 12 % .

Loans from relatives carries interest rate @ 15 to 18 %

5. Loans secured by hypothecation of Assets (Vehicles) are secured by hypothecation of the Assets (Vehicles) under finance. In the opinion of the Board, the market value of the hypothecated Assets (Vehicle) as on Balance Sheet date is more than the amount of Loan Outstanding.

6. Loans secured by Hypothecation of Vehicle includes Rs. 21,00,713/- (P.Y. 14,72,820/-) outstanding portfolio on which NPA provision of Rs. 2,10,345/- (P.Y. Rs. 1,47,280/-) has been made.

7. Loans to Companies, Firms & Individuals includes Rs. Nil (P.Y. 57,457/-) outstanding portfolio on which NPA provision of Rs. Nil (P.Y. Rs. 5,748/-) has been made

8. Bad debts & Irrecoverable W/off are shown net off bad debts recovery during the year amounting to Rs. 7,42,973/- (P.Y. 5,00,941/-).

9. NPA provisions are shown net off NPA Provision written back during the year amounting to Rs. 3,72,539/- (P.Y. Rs. 2,12,144/-)

10. Contingent liabilities not provided for: -

(a) Disputed Demand of Income Tax Rs. 17.12 Lacs (Previous year Rs. 19.27 Lacs) (Against which the Company has paid Rs. 11.41 Lacs [Previous year Rs. 19.27 Lacs] under protest which are shown as advances).

(b) Guarantee given by company of Rs. 2200 Lacs (P.Y. Rs. Nil) for Working Capital Loan taken by its subsidiary company.

11. Related Party Disclosures :

List of Related Parties with whom transactions have taken place during the year:

A) Subsidiary Namra Finance Ltd.

B) Key Management Personnel

Mr. Jayendrabhai Patel

Mr. Aalokbhai Patel

Mr. Amitbhai Manakiwala

C) Relatives of Key Management Personnel

Name of Party Related party Relationship

Mrs. Ritaben J. Patel Relative of Key Management Personnel

Mr. Aakash J. Patel Relative of Key Management Personnel

J.B.Patel HUF Key Management personnel is Karta

Raj Enterprise Key Management personnel is Proprietor

Mrs. Himani Manakiwala Relative of Key Management Personnel

J B Patel & Co. Key Management personnel is co-owner

Mrs. Sachi Patel Relative of Key Management Personnel

Aalok Patel (HUF) Key Management personnel is Karta

Amit Manakiwala (HUF) Key Management personnel is Karta

Aakash Patel (HUF) Relative of Key Management Personnel

Namra Holdings & Cons. Relative of Key Management Personnel

Services Pvt. Limited Is Director

List of Transaction, out of the transaction reported in the above table, where the transaction entered in to with single party exceeds 10 % of the total related party transactions of similar nature are as under:

Unsecured Loan taken includes

taken from Shri Jayendra Patel Rs. 5085000 (P.Y. Rs. 7615000), from Smt. Himani A. Manakiwala Rs. 1300000 (PY Rs. 800000), from Smt. Ritaben J. Patel Rs. 1487500 (P.Y. Rs 3275000), from Shri Aakash J. Patel Rs. Nil (PY. 5.180.000) , from Shri Aalok J. Patel Rs. 3050000(P.Y Rs. 2880000), from Jayendra Patel (HUF) Rs. 2675000 (PY. Rs.1630000), from Smt. Sachi Patel Nil (P.Y. Rs. 1193000), from Amit Manakiwala (HUF) Rs.Nil (PY. Rs. 1120000), from Namra Holdings & Consultancy Servises Pvt. Limited Rs.1965000 (P.Y. Rs. 790000), from Shri Aakash J. Patel ( HUF ) Rs. 2375000 (P.Y. 150000). Unsecured Loan repayments includes paid to Shri Jayendra Patel Rs. 5576248(P.Y. Rs. 8267416), to Smt. Himani A. Manakiwala Rs. 1426409 (P.Y. Rs. 941239), to Smt. Ritaben J. Patel Rs. 1793825 (PY Rs. 3517351), to Shri Aakash Patel Rs. Nil (P.Y. Rs. 5908718 ), to Shri Aalok Patel Rs. 3443157 (PY Rs. 3250328), to Aaksh Patel (HUF) Rs.2438618 (P.Y. Rs. 174991), to Smt. Sachi Patel Rs. Nil (P.Y. Rs. 1395145), to Amit Manakiwala(HUF) Rs.1512271 (P.Y. Rs. 1308714), to Jayendra Patel (HUF) Rs.3000229 (PY Rs. 18,19,361), to Namra Holdings & Consultancy Services Pvt. Limited Rs.2206101 (P.Y. Rs. 904016).

Unsecured Loan granted includes paid to Namra Finance Limited Rs. 404042640(P.Y. Nil).

Unsecured Loan received back includes Received from Namra Finance Limited Rs. 405794793(P.Y. Nil).

Interest Income includes Received from Namra Finance Limited Rs. 13223711 (P.Y. Nil).

Interest Expenses includes paid to Shri Jayendra Patel Rs. 491218 (PY Rs. 587175), to Shri Aakash Patel Rs. Nil (P.Y. Rs. 582973), to Shri Aalok Patel Rs. 393157 (P.Y. Rs. 333293), to Smt. Ritaben J Patel Rs. 306325 (PY Rs. 218115), to J B Patel (HUF) Rs. 325229 (P.Y. Rs. 170424), to Aakash Patel (HUF) Rs.263618 (P.Y. Rs. 22,491), to Smt. Sachi Patel Rs. Nil (P.Y. Rs. 161716), to Amit Manakiwala(HUF) Rs. Nil (P.Y. Rs. 169843), to Smt. Himani Manakiwala Rs. 126409 (PY Rs. 127114), to Namra Holdings & Consultancy Services Pvt. Limited Rs.241101 (PY Rs. 102614).

Remuneration and perquisites includes payment to Shri Jayendrabhai Patel Rs. 1532600 (PY Rs. 1535536) and to Shri Amit Manakiwala Rs. 900000 (P.Y. Rs. 390000), to Shri Aalok Patel Rs. 549600 (P.Y. 550000)

Professional Fees includes payment to Shri Amit Manakiwala Rs. Nil (P.Y. Rs. 390000),

Sitting Fees included paid to Smt. Ritaben Patel Rs. 50000 (P.Y. Rs. 62500) and Shri Amitbhai R. Manakiwala Rs. Nil (PYRs. 22500),

Rent includes paid to J B Patel & Co. Rs. 20224 (P.Y. 20224),

Dividend Paid includes paid to Shri Aalok Patel Rs. 197984 (Rs. 161432), to Jayendrabhai Patel HUF Rs.156800 (P.Y. Rs. 156800), to Shri Aakash Patel Rs. 223064 (P.Y. Rs. 186512), to Shri Jayendrabhai Patel Rs. 226355(PY Rs. 188952.80), to Smt. Ritaben Patel Rs. 237339 (P.Y. Rs. 200248), to Namra Holdings & Cons. Services Pvt. Limited Rs. 132320 (P.Y. Rs. 132320), to Shri Amitbhai Manakiwala Rs. 155202 (P.Y. Rs. 130080), to Smt. Himani Manakiwala Rs. 40000 (PY Rs. 40000).

Investments in Subsidiary Company includes investment into Namra Finance limited Rs. 50000000/- (P.Y. Rs. 30110000/-).

Transfer of Receivables under Securitization included transaction with Namra Finance limited of Rs. 11791300/ - (PY 49500000)

Purchase of Shares of Subsidiary includes purchase made from Shri Jayendrabhai Patel Rs. Nil (PY 2,000) , to Shri Amit Manakiwala Rs. Nil (PY Rs. 2,000), to Shri Aalok Patel Rs. Nil (PY 2,000), Smt. Ritaben Patel Rs. Nil (PY 1.000) .

12. Balances are subject to confirmation.

13. Borrowing costs attributable to the acquisition or construction of Qualifying Assets amounting to Rs. Nil (P. Y. Rs. Nil)

14. Share Application Money forfeited during the year is transfer to General Reserve of Rs. 14.99 Lacs (P.Y. Rs. Nil).

15. Lease:

The Company has entered into certain rent agreements and amounts of Rs. 22.99 Lacs (P.Y. Rs. 25.82 Lacs) paid under such agreements have been charged to the Statement of profit and Loss. These rents agreements are generally not non-cancellable and are renewable by mutual consent on mutually agreed terms. There are no restrictions imposed by such agreements.

16. During the year, the company has impaired the assets to the tune of Rs. Nil (P.Y. Rs. Nil).

17. In the opinion of the Board, Current assets and loans and advances, are approximately of the value stated, if realized in ordinary course of business.

18. As per the prudential norms of the Reserve Bank of India, provision has been made in the accounts for the Non Performing Assets. Income is not recognised in respect of Non Performing Assets.

19. Previous year's figures have been regrouped and rearranged wherever necessary, to make them comparable with those of current year.

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Mar 31, 2013

1. Contingent liabilities not provided for: -

(a) Disputed Demand of Income Tax Rs. 19.27 Lacs (Previous year Rs. 19.27 Lacs) (Against which the Company has paid Rs.19.27 Lacs [Previous year Rs. 19.27 Lacs] under protest which are shown as advances)

2. Related Party Disclosures :

List of Related Parties with whom transactions have taken place during the year:

A) Subsidiary Namra Finance Ltd.

B) Key Management Personnel Mr. Jayendrabhai Patel

Mr. Aalokbhai Patel

Mr. Amitbhai Manakiwala

3. Balances are subject to confirmation.

4. Borrowing costs attributable to the acquisition or construction of Qualifying Assets amounting to Rs. Nil (P. Y. Rs. Nil)

5. Lease:

The Company has entered into certain operating lease agreements and amounts of Rs.25.82 Lacs (P.Y. Rs. 18.60 Lacs) paid under such agreements has been charged to the Statement of rofit and Loss. These lease are generally not non cancellable and are renewable by mutual consent on mutually agreed terms. There are no restrictions imposed by such agreements.

6. During the year, the company has impaired the assets to the tune of Rs. Nil (P.Y. Rs. Nil).

7. In the opinion of the Board, Current assets and loans and advances, are approximately of the value stated, if realized in ordinary course of business.

8. As per the prudential norms of the Reserve Bank of India, provision has been made in the accounts for the Non Performing Assets. Income is not recognised in respect of Non Performing Assets.

9. Previous year''s figures have been regrouped and rearranged wherever necessary, to make them comparable with those of current year.

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Mar 31, 2012

1.1 The company has only one class of shares referred to as Equity shares having face value of Rs. 10/-. Each Holder of Equity Share is entitled to 1 vote per share.

1.2 In the event of liquidation of the Company, the holders of Equity shares will be entitled to receive any of the remaining assets of the company , after distribution of all preferential amounts.However, no such preferential amounts exist currently.The distribution will be in proportion to the number of Equity shares held by the shareholder.

1.3 The Company declares and pays dividends in Indian Ruppes. The Dividend proposed by the Board of Director is subject to the approval of the shareholders in the ensuing Annual General Meeting.

1.4 During the year ended 31st March, 2012, the amount of per share dividend recognised as distribution to equity shareholders was Rs. 32,61,280/- (Rs. 0.80).The Total dividend appropriation for the year ended 31st March,2012 amounted Rs. 32,61,280/-(P.Y.32,61,280/-) excluding corporate dividend tax Tax of Rs.5,28,980/- (P.Y. 5,41,666/-).

2.1 Loan from related party carry interest rate 18 %.

2.2 Loan from Corporates carry interest rate 18 %.

3.1 Current Account with Banks includes Rs. 5,58,852/- (Prev. Year Rs. 2,49,508/-) in Unpaid Dividend Account.

4.1 Bad debts & Irrecoverable W/off are shown net off bad debts recovery during the year amounting to Rs. 11,69,860/- (P.Y. 3,91,570/-).

5. Contingent liabilities not provided for: -

(a) Disputed Demand of Income Tax Rs. 19.27 Lacs (Previous year Rs. 38.69 Lacs) (Against which the Company has paid Rs. 19.27 Lacs [Previous year Rs. 29.73 Lacs] under protest which are shown as advances)

6. Segment Reporting:

In the opinion of the management, the Company is mainly engaged in the business of providing commercial finance. All other activities of the Company revolve around the main business, and as such, there are no separate reportable segments.

7. Related Party Disclosures :

List of Related Parties with whom transactions have taken place during the year.

A) Subsidiary

Namra Finance Ltd.

B) Key Management Personnel

Mr. Jayendrabhai Patel

Mr. Aalokbhai Patel

Mr. Amitbhai Manakiwala

C) Relatives of Key Management Personnel

Name of Party Related party Relationship

Mrs. Ritaben J. Patel Relative of Key Management Personnel

Mr. Aakash J. Patel Relative of Key Management Personnel

J.B.Patel HUF Key Management personnel is Karta

Raj Enterprise Key Management personnel is Proprietor

Mrs. Himani Manakiwala Relative of Key Management Personnel

Mr. Maulik Manakiwala Relative of Key Management Personnel

J B Patel & Co. Key Management personnel is co-owner

Mrs. Sachi Patel Relative of Key Management Personnel

Amit Manakiwala (HUF) Key Management personnel is Karta

Aakash Patel (HUF) Relative of Key Management Personnel

Namra Holdings & Cons. Relative of Key Management Personnel

Services Pvt. Limited is Director

List of Transaction, out of the transaction reported in the above table, where the transaction entered in to with single party exceeds 10 % of the total related party transactions of similar nature are as under:

Unsecured Loan taken includes taken from Shri Jayendra Patel Rs. 47,65,000 (P.Y. Rs. 20,10,000), from Smt. Himani A. Manakiwala Rs. 7,25,000 (P.Y. Rs. 1,50,000), from Smt. Ritaben J. Patel Rs. 37,75,000 (P.Y. Rs21,00,000), from Shri Aakash J. Patel Rs. 37,00,000 (P.Y. 5,95,000), from Shri Aalok J. Patel Rs. 17,55,000 (P.Y Rs.15,45,000), from Jayendra Patel (HUF) Rs.13,30,000 (P.Y. Rs.2,05,000), from Smt. Sachi Patel 10,78,000 (P.Y. Rs. 6,58,000), from Amit Manakiwala (HUF) Rs.7,25,000 (P.Y. Rs. 7,00,000), from Namra Holdings & Consultancy Servises Pvt. Limited Rs.13,50,000 (P.Y. Rs. 15,00,000) , from Shri Aakash J. Patel – (HUF) Rs. 1,25,000 (P.Y. Nil) Unsecured Loan repayments includes paid to Shri Jayendra Patel Rs. 54,96,878 (P.Y. Rs. 31,24,114), to Smt. Himani A. Manakiwala Rs. 8,51,567 (P.Y. Rs. 7,91,839), to Smt. Ritaben J. Patel Rs. 40,52,448 (P.Y. Rs. 35,40,297), to Shri Aakash Patel Rs.44,76,016 (P.Y. Rs. 33,58,848), to Shri Aalok Patel Rs. 20,52,496 (P.Y. Rs. 39,39,204), to Aaksh Patel (HUF) Rs.1,46,417 (P.Y. Rs. 1,19,530), to Smt. Sachi Patel Rs,12,08,575 (P.Y. Rs. 7,17,287), to Amit Manakiwala(HUF) Rs.8,51,567 (P.Y. Rs. 7,89,088), to Shri Maulik Manakiwala Rs,Nil (P.Y. Rs. 4,96,551), to Jayendra Patel (HUF) Rs.15,59,853 (P.Y. Rs. 14,97,208), to Namra Holdings & Consultancy Servises Pvt. Limited Rs.14,84,877 (P.Y. Rs. 15,53,013), Acquisition of shares includes investments made in Namra Finance Limited Rs. 1,99,90,000 (P.Y. Nil)

Interest paid includes to Shri Jayendra Patel Rs. 6,58,689 (P.Y. Rs. 3,80,108), to Shri Aakash Patel Rs. 4,76,939 (P.Y. Rs. 4,42,612), to Shri Aalok Patel Rs. 2,67,744 (P.Y. Rs. 5,08,432), to Smt. Ritaben J Patel Rs. 2,49,703 (P.Y. Rs. 4,49,126), to J B Patel (HUF) Rs. 2,06,867 (P.Y. Rs. 2,17,683), to Aakash Patel (HUF) Rs.19,276 (P.Y. Rs. 17,754), to Smt. Sachi Patel Rs. 1,04,460 (P.Y. Rs. 53,359), to Amit Manakiwala(HUF), Rs. 1,13,911 (P.Y. Rs. 80,179), to Smt. Himani Manakiwala Rs.1,13,911 (P.Y. Rs. 1,07,252), to Shri Maulik Manakiwala Rs. Nil (P.Y. Rs. 21,551), to Namra Holdings & Consultancy Services Pvt. Limited Rs.1,21,390 (P.Y. Rs. 53,013) Balance Outstanding includes of Aakash Patel Rs. Nil (P.Y. Rs. 1,80,639) Remuneration includes payment to Shri Jayendrabhai Patel Rs. 15,32,603 (P.Y. Rs. 15,32,603) and to Shri Amit Manakiwala Rs. Nil (P.Y. Rs. 44,625), to Shri Aalok Patel Rs.5,50,000 (P.Y. 4,62,436) Sitting Fees included paid to Smt. Ritaben Patel Rs. 57,500 (P.Y. Rs. 30,000) and Shri Amitbhai R. Manakiwala Rs.37,500 (P.Y.Rs.20,000), Rent includes paid to J B Patel & Co. Rs. 19,856 (P.Y. 19,856), Professional Fees includes paid to Shri Amitbhai R. Manakiwala Rs. 7,80,000 (P.Y.Rs.6,88,000), Dividend Paid includes paid to Sh. Aalok Patel Rs. 1,61,432 (Rs. 1,21,074), to Jayendrabhai Patel HUF Rs.1,56,800 (P.Y. Rs. 1,17,600), to Sh. Aakash Patel Rs. 1,86,512 (P.Y. Rs. 1,39,881), to Sh. Jayendrabhai Patel Rs. 1,70,458 (P.Y. Rs. 1,27,843), to Smt. Ritaben Patel Rs. 1,83,848 (P.Y. Rs. 1,37,886), to Namra Holdings & Cons. Services Pvt. Limited Rs. 1,32,320 (P.Y. Rs. 99,240), to Sh. Amitbhai Manakiwala Rs. 1,30,080 (P.Y. Rs. 97,560)

8. Balances are subject to confirmation.

9. In the opinion of the Board, Current assets and loans and advances, are approximately of the value stated, if realized in ordinary course of business.

10. As per the prudential norms of the Reserve Bank of India, provision has been made in the accounts for the Non Performing Assets. Income is not recognised in respect of Non Performing Assets.

11. As required in terms of Paragraph 13 of Non-Financial Companies Prudential Norms (Reserve Bank) Directions, 2007, schedule to the Balance Sheet of a Non-Banking Financial Company are annexed hereto.

12. Previous year's figures have been regrouped and rearranged wherever necessary, to make them comparable with those of current year. Till the year ended 31st March 2011, the company was using pre-revised Schedule VI to the Companies Act, 1956, for preparation and presentation of its financial statements. During the year ended 31st March, 2012, the revised schedule VI notified under the Companies Act, 1956, has become applicable to the company. The Company has reclassified previous year figures to conform to this classification. The adoption of revised schedule VI does not impact recognition and measurement principles followed for preparation of financial statement. However, it significantly impacts presentation and disclosures made in the financial statements, particularly presentation of Balance Sheet.

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Mar 31, 2010

1. Contingent liabilities not provided for: -

(a) Disputed Demand of Income Tax Rs. 58.70 Lacs (Previous year Rs.58.70 Lacs) (Against which the Company has paid Rs. 11.00 Lacs [Previous year Rs.11.00 Lacs] under protest which are shown as advances)

2. Segment Reporting:

In the opinion of the management, the Company is mainly engaged in the business of providing commercial finance. All other activities of the Company revolve around the main business, and as such, there are no separate reportable segments.

3. Related Party Disclosures :

List of Related Parties with whom transactions have taken place during the year:

A) Key Management Personnel

Mr. Jayendrabhai Patel Mr. Amitbhai Manakiwala

B) Relatives of Key Management Personnels

Name of Party Related party Relationship

Mrs. Ritaben J. Patel Relative of Key Management Personnel

Mr. Aakash J. Patel Relative of Key Management Personnel

Mr. Alok J. Patel Relative of Key Management Personnel

J.B.Patel HUF Key Management personnel is Karta

Raj Enterprise Key Management personnel is Proprietor

Himani Manakiwala Relative of Key Management Personnel

Maulik Manakiwala Relative of Key Management Personnel

J B Patel & Co. Key Management personnel is co-owner

List of Transaction, out of the transaction reported in the above table, where the transaction entered in to with single party exceeds 10 % of the total related party transactions of similar nature are as under:

Unsecured Loan taken includes taken from Sh.Jayendra Patel Rs. 21,70,000 (P.Y. Rs. 16,91,484), from Smt. Himani A. Manakiwala Rs. 5,25,000 (P.Y. Rs. 10,00,000), from Smt. Ritaben J. Patel Rs. 25,50,000 (P.Y. Rs. 2,00,000), from Aakash J. Patel Rs. 15,00,000 (P.Y. Nil), from Aalok J. Patel Rs. 13,65,000 (P.Y. Nil), from Jayendra Patel (HUF) Rs.80,000 (P.Y. Rs.Nil), Unsecured Loan repayments includes paid to Sh.Jayendra Patel Rs. 24,84,664 (P.Y. Rs. 24,35,692), to Smt. Himani A. Manakiwala Rs. NIL (P.Y. Rs. 19,75,000), to Smt. Ritaben J. Patel Rs. 23,20,709 (P.Y. Rs. 21,32,800), to Aakash Patel Rs. Nil (P.Y. Rs. 13,65,543), to Aalok Patel Rs. 2,41,277 (P.Y. Rs. 13,29,436), Interest paid includes to Sh. Jayendra Patel Rs. 2,58,740 (P.Y. Rs. 2,42,682), to Sh. Aakash Patel Rs. 3,86,585 (P.Y. Rs. 3,19,219), To Sh. Aalok Patel Rs. 3,07,798 (P.Y. Rs. 2,86,622), to Smt. Ritaben J Patel Rs. 3,49,312 (P.Y. Rs.3,54,304), to J B Patel (HUF) Rs. 1,82,789 (P.Y. Rs. 1,75,501), Balance Outstanding includes of Sh.Jayendra Patel Rs. 7,74,076 (P.Y. Rs. 8,30,000), of sh. Aakash Patel Rs. 25,32,165 (P.Y. Rs. 9,60,000), Sh.Aalok Patel Rs.18,86,535 (P.Y. Rs. 6,20,000), of Smt Ritaben Patel Rs. 10,28,603 (P.Y. Rs. 4,50,000), of J B Patel (HUF) Rs. 10,96,964 (P.Y. Rs. 9,75,000), Remuneration includes payment to Sh. Jayendra Patel Rs. 6,39,749 (P.Y. Rs. 5,54,255) and to Sh. Amit Manakiwala Rs. 2,50,231 (P.Y. Rs. 3,10,409), Sitting Fees included paid to Smt. Ritaben Patel Rs. 40000 (P.Y. Rs. 40000) and Sh.Amitbhai R. Manakiwala Rs. 5,000 (PYRs.Nil), Rent includes paid to Sh. J B Patel & Co. Rs. 19,856 (P.Y. Nil), Professional Fees includes paid to Sh.Amitbhai R. Manakiwala Rs. 2,10,000 (PYRs.Nil)

4. Balances are subject to confirmation.

5. In the opinion of the Board, Current assets and loans and advances, are approximately of the value stated, if realised in ordinary course of business.

6. As per the prudential norms of the Reserve Bank of India, provision has been made in the accounts for the Non Performing Assets. Income is not recognised in respect of Non Performing Assets.

7. Share Trading Income includes Rs. 1,16,507/- (P.Y. Rs. 1,22,271/-) on account of (diminution)/ increase in the market value of closing stock. There is no an actual sale or purchase of shares during the year.

8. Loans Secured by Hypothecation includes Rs. 8,39,176/- (P.Y. Rs. 14,29,202/--) out standing portfolio on which NPA provisions of Rs. 83,918/- (P.Y. Rs. 1,42,920/-) has been made.

9. Loans to Companies, Firms & Individual includes Rs. 5,04,100 /- (P.Y. Rs. 9,63,907/-) out standing portfolio on which NPA provisions of Rs. 50,410/- (P.Y. Rs. 96,391/-) has been made.

10. Sundry Debtors includes Rs. 32,73,426/- (P.Y. Rs. 24,09,816/-) principal out standing on which NPA provisions of Rs. 3,51,650/- (P.Y. Rs. 2,43,654/-) has been made.

11. Bad debts & Irrecoverable W/off are shown net off bad debts recovery during the year amounting to Rs.1,40,077/-(P.Y. Rs. 1,79,641/-).

12. NPA Provision are shown net off NPA Provision written back during the year amounting to Rs. 4,08,258/-. (P.Y. 3,53,131/-).

13. Current Account with Banks includes Rs. 74,590/- (Prev. Year Rs. 74,590/-) in Unpaid Dividend Account.

14. Loans secured by hypothecation of Assets (Vehicles) are secured by hypothecation of the Assets (Vehicles) under finance. In opinion of the Board, the market value of the hypothecated Assets (Vehicle) as on Balance Sheet date is more then the amount of Loan Outstanding.

15. To the extent of available information, at the year-end, there were no outstanding amounts due to S.S.I Units in excess of Rs. 1,00,000/-.

16. As required in terms of Paragraph 13 of Non-Financial Companies Prudential Norms (Reserve Bank) Directions, 2007, schedule to the Balance Sheet of a Non-Banking Financial Company are annexed hereto.

(Amount in Rs.)

17. Earning in foreign currency - Nil (Nil)

18. Expenditure in foreign Currency Nil (Nil)

19. Previous years figure have been regrouped / rearranged wherever necessary so as to make them comparable with those of the current year.