Notes to Accounts of Barak Valley Cements Ltd.

Mar 31, 2024

(b) Terms/Rights attached to equity shares

The company has only one class of equity shares having par value of Rs. 10.00 per share. Each holder of Equity shares is entitlled to one vote per share.

In the event of liquidation of the company, the holders of the equity shares will be entitled to receive remaining assets of the company,after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Nature and purpose of reserves :

Securities Premium : At the time of Initial Public Offer, the excess of issue price of shares over the face value of shares issued, minus expenditure incurred on issuance of shares is treated as Securities Premium. It is utilised in accordance with the provisions of the Act, to issue bonus shares, to provide for premium on redemption of shares, write off equity related expenses etc.

General Reserve : The company had transferred a portion of the net profit of the company before declaring dividend to general reserve pursuant to the earlier provisions of the Companies Act, 1956.

Retained Earnings : Retained Earnings are the profits that the company has earned till date, less any transfers to general reserve, dividends or other distributions paid to the the shareholders of the company.

The company has not declared or paid any dividend during the year.

(i) Term Loan raised during the year have been used for the same purpose for it was drawn.

(ii) Outstanding Rupee Term Loans (RTL) of Rs. 1,133.35 Lacs (Last year : Rs. 1,400.01 Lacs) out of the sanctioned loan of Rs. 1,600.00 Lacs was taken from a financial institution which is repayable from August’ 2022 in monthly installment of Rs. 22.22 Lacs till July’ 2028. The loan is secured by first charge on land, building including civil structure of the company’s assets and extension of first charge on plant and machinery, fixed and immovable assets of the company on pari -passu basis with IDBI Bank. The loans has also been guaranteed by personal guarantees of some of the Directors of the Company. Amother term Loan of Rs. 800.00 Lacs (Outstanding balance of Rs. 215.36 Lacs as on 31.03.2023) was fully repaid during the year.

(iii) WCTL Loan of Rs. 535.70 Lacs ( Last year : Rs.734.50 Lacs) under GECL Scheme is secured by way of Second charge on all the current assets of the company, which were extended for taking existing credit facility of Rs. 2500.00 Lacs.

(iv) Term Loans from related parties are unsecured and due for repayment after 12 months as on the reporting date. The company does not have any existing default as at the date of balance sheet.

(v) Hire Purchase Finance is secured by hypothecation of vehicles / equipments and is repayable within three to four years.

Notes-

(a) Working Capital facilities of Rs. 2,374.37 lacs (Last year : Rs. 2,405.65 Lacs) from banks (sanctioned amount : Rs. 2,500.00 Lacs) are secured by first charge on current assets of the company and first charge on the fixed assets of the company pari-passu basis with NEDFi, both present and future including mortgage of immovable assets. Working Capital facilities from banks have also been guaranteed by some of the Directors of the company.

(37) Capital Commitments

The estimated amount of Contracts remaining to be executed on Capital Account and other capital commitment not provided for Rs. - Nil - (Nil as at 31^st March’ 2023)

(38) Contingent liabilities not provided for:

(a) Corporate Guarantee’s given to Financial Institutions/ Banks on behalf of wholly owned subsidiary company : Rs. 300.00 Lacs (Rs. 300.00 Lacs as at 31^st March’ 2023).

(b) Claims against the company not acknowledged as debts: Disputed demands of Entry - tax/ Income- Tax / Central Excise duty refund matters pending before the Appellate Authorities: Rs. 539.93 Lacs (Rs. 537.21 lacs as at 31^st March’ 2023)

(c) Fixed Deposit Receipts pledged with the banks / others: Rs. 149.57 Lacs (Rs. 49.71 Lacs as at 31^st March’ 2023)

There is no principal and interest overdue to Micro and Small enterprises. During the year no interest has been paid to such parties. This information has been determined to the extent such parties have been identified on the basis of information available with the company and the same has relied upon by the auditors.

(42). Employees benefit obligations:

a) Defined contribution plans:

The Company makes contribution towards Employees recognized provident fund, Employees State Insurance and labour welfare fund schemes. Under these schemes, the Company is required to contribute a specified percentage of payroll cost, as specified in the rules of these schemes, to these defined contribution schemes. During the year, the Company recognised Rs. 63.87 Lacs (Rs. 50.72 Lacs as at 31st March, 2023) as expense towards contribution to these plans and included in “Employee benefit expenses” in Note 31 to the financial statements.

b) Defined benefit plans:(i) Leave encashment:

Under leave encashment scheme, the company allows its employees to en-cash accumulated leave over and above thirty days at any time during the year. So, accumulated leave encashment liability for up to 30 days period is classified as non -current liability and over the period of 30 days is covered under current liability. Earned Leave liability at year end are as follows :

(ii) Gratuity:

The Company provides for gratuity, a defined benefit retirement plan covering eligible employees. The Gratuity plan provides a lump sum payment to vested employees at retirement, death or termination of employment as per the Company’s policy. The gratuity payable to employees is based on the employee’s tenure of service and last drawn salary at the time of leaving the services of the company. The gratuity benefits are payable after five years of continuous service by the employee and are valued in accordance with the Payment of Gratuity Act, 1972.

(iii) Risk Exposure:

Through its defined benefit plans the Company is exposed to a number of risks, significant of which are as follows:

(a) Investment risk: If the plan is funded then assets liabilities mismatch & actual investment return on assets lower than the discount rate assumed at the last valuation date can impact the liability.

(b) Discount Rate: Reduction in discount rate in subsequent valuations can increase the plan’s liability.

(c) Mortality and disability: Actual deaths and disabilities cases proving lower or higher than assumed in the valuation can impact the liabilities.

(d) Salary growth risk : The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. An increase in the salary of the plan participants will increase the plan liability. Any variation in salary increase rate assumption in future valuations will also increase the liability.

(e) Withdrawals : Actual withdrawals proving higher or lower than assumed withdrawals and change of withdrawals rates at subsequent valuations can impact Plan’s liability.

i) Fair value hierarchy

This section explains the judgments and estimates made in determining the fair values of the financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial instruments into the three levels prescribed under the accounting standard.

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

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

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

ii) Valuation technique used to determine fair value

Specific valuation techniques used to value financial instruments include:

• The use of quoted market prices or dealer quotes for similar instruments

• The fair value of the financial instruments is determined using Net Worth method.

iv) Fair value of financial assets and liabilities measured at amortized cost :

The carrying amounts of all other financial assets i.e. term deposits and interest there on, trade receivables, cash and cash equivalents, other financial assets and financial liabilities i.e. borrowings, trade payables and other current financial liabilities are considered to be the same as their fair values due to their short -term nature.

(44) - Capital Risk management

(a) The company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The company’s objective when managing capital are to Safeguard the company’s ability to continue as a going concern in order to provide returns for shareholders and maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the company may adjust the amount of dividend to shareholders, return capital to shareholders or issue new shares. The company monitors capital using debt -equity ratio, which is total debt less liquid investments and bank deposits divided by total equity.

(46) No Loans are due from directors or other officers of the company or any of them either severally or jointly with any other person, that are repayable on demand; or without specifying any terms or period of repayment. Further, No loans are due from firms or private companies in which any director is a partner, a director or a member. Details of Loans or advances to Subsidiary companies are as under :

(47) The company has given Corporate Guarantee to the bankers of Meghalaya Minerals & Mines Ltd., a 100% subsidiary of the company for collaterally securing their Working Capital limit and WCTL facility (under GECL) amounting Rs. 354.26 Lacs (Outstanding Rs. 133.84 Lacs as at 31.03.2024 and Rs. 320.18 Lacs as at 31.03.2023)

(48) Segment Information :

The Company is exclusively engaged in the business of cement and cement related products. As per Ind AS 108 “Operating Segments”, specified under Section 133 of the Companies Act, 2013, there are no reportable business and geographical segment applicable to the Company. The company does not hold any non-current assets in foreign countries.

(49) Financial risk management objective and policies:

The Company realizes that risks are inherent & integral part of any business. The primary focus is to foresee the unpredictability of financial market & seek to minimize potential adverse effect on its financial performance. The Company’s activities are exposed to a variety of financial risks from its operations. The Company’s principal financial liabilities includes borrowings, trade payable and other financial liabilities. The main purpose of these financial liabilities is to finance the Company’s assets and operations. The Company’s principal financial assets include trade receivables, cash and cash equivalents and other financial assets that are derived directly from its operations.

The company is exposed to Credit risk, Liquidity risk and Market risk. The Company’s senior management oversees the management of these risks and the appropriate financial risk governance framework for the Company is in place. The senior management provides assurance that the Company’s financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives. The Audit Committee and the Board are regularly apprised of these risks every quarter and each such risk and mitigation measures are extensively discussed and the same are summarized below:

(a) Credit Risk: Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, thereby leading to a financial loss. The company is exposed to credit risk from its operating activities primarily from trade receivables including deposits with banks and financial institutions and other financial instruments.

(i) Trade receivables: Customer credit risk is managed by the company through its established policy, procedures and control relating to customer credit risk management. Trade receivables are non interest bearing and are generally carrying 30-45 days credit term. Outstanding debtors are regularly monitored by the sales and collection team of the company. Further the company receives security deposits from its customers which mitigate the credit risk. The ageing of trade receivables as of balance sheet date is as below:

(ii) Financial instruments and deposits: Credit risk from balance with banks and financial institutions is managed by the finance department of the company. Credit risk on cash and cash equivalents and bank deposits is generally low as the said deposits have been made with banks having good reputation, good past track record and high quality credit rating and the company also reviews their credit worthiness on an on-going basis. Other financial assets are considered to be of good quality and there is no significant risk.

(b) Liquidity Risk : Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or other financial asset. Due to the nature of the underlying business, the company maintains sufficient cash and liquid investments available to meet its obligation. Management of the company regularly monitors rolling forecast of the company’s liquidity position and cash and cash equivalents on the basis of expected cash flows.

The liquidity risk is managed by Company’s financial policy, which aims to ensure the availability of sufficient net funds to meet the company’s financial commitments with minimal additional cost.

(i) Financial arrangements : The company had access to the working capital facilities from the bank amounting Rs. 2,500.00 Lacs (Outstanding balance Rs. 2,374.38 Lacs as at 31^st March’2024) which are expiring in one year, subject to the renewal of the same by the banking authorities. A part from the working capital facility, company has also following outstanding financial liabilities :

(ii) Maturities of financial liabilities : The following tables shows the maturity analysis of the Company’s financial liabilities based on the contractually agreed undiscounted cash flows as at the balance sheet date :

(c ) Market Risk :

Market risk is the risk of loss of future earnings, fair value of future cash flows of a financial instrument that may fluctuate consequent up on changes in market prices. It mainly comprises of interest rate risk.

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will be impacted because of changes in market interest rate. As the company’s borrowings except borrowing from market are fixed rate borrowings; they are carried out at amortised cost and are not subject to interest rate risk as defined in Ind AS 107.

(50) Corporate Social Responsibility (CSR) activities :

As per Section 135 of the Companies Act, 2013, a Corporate Social Responsibility (CSR) committee has been formed by the Company and the amount needs to be spent by the Company for the year is 2% of average net profits for previous three financial years, calculated as per Section 198 of the Companies Act, 2013. The nature of CSR activities identified by company are promoting education, sports, Rural development, medical and health facility, water sanitation and social projects. All these activities are covered under Schedule VII to the Companies Act, 2013. The details of amount spent are:

(52) Other Statutory information :

i) The Company do not have any benami property, and no proceeding has been initiated against the Company for holding any benami property.

ii) The Company do not have any transactions with companies struck off.

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

iv) The Company have not traded or invested in crypto currency or virtual currency during the financial year.

v) The Company have not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (ultimate beneficiaries) or

b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

vi) The Company have not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Group shall:

a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (ultimate beneficiaries) or

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

vii) The Company have not any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961”.

viii) The Company have not declared willful defaulter by any banks or any other financial institution at any time during the financial year.

ix) The Company had made the assessment for books of accounts as per definition in the Act and identified SAP as accounting Software used for the Creation and maintenance of books of accounts which have a feature of recording audit trail (Edit Log) facility and the same has operated throughout the year for all relevant transactions recorded. Further, in case of the Company, audit trail (edit log) facility was enabled and operated throughout the year, we did not come across any instance of the audit trail feature being tempered with. However, the audit trail feature facility was not enabled at the database level to log any data changes for the accounting software used for maintaining the books of accounts.

(53) Previous year’s figures have been regrouped and/ or re-arranged wherever necessary, to confirm to current year’s classification.

(54) The financial statements are approved by the Audit Committee at its meeting held on 30th May’ 2024 and by the Board of Directors on the same date.

---

Mar 31, 2023

2.18 Provisions and Contingencies:

A Provision is recognized for a present obligation as a result of past events if it is probable that an outflow of resources will be required to settle the obligation and in respect of which a reliable estimate can be made. Provisions are not recognised for future operating losses. Provisions are determined based on management''s best estimates of the expenditure required to settle the present obligation at the end of the reporting period. The increase in the provision due to the passage of time is recognised as interest expenses.

Liabilities which are material in nature and whose future outcome cannot be ascertained with reasonable certainty are treated as contingent and disclosed by way of notes to the accounts. Contingent assets are not recognised in the financial statements.

2.19 Cash and Cash Equivalents :

Cash and cash equivalents in the Balance Sheet comprise cash in hand, cash at bank and demand deposits with banks and other short term highly liquid investments /deposits with an original maturity period of three months or less that are readily convertible into known amounts of cash and which are subject to insignificant risk of change in value.

2.20 Earnings Per Share :

Basic earnings per share are calculated by dividing the net profit or loss before other comprehensive income for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. The weighted average number of equity shares outstanding during the period and for all periods presented is adjusted for events, such as bonus shares, other than the conversion of potential equity shares that have changed the number of equity shares outstanding, without a corresponding change in resources.

For the purpose of calculating diluted earnings per share, the net profit or loss before other comprehensive income for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

2.21 Leases :

Ind- AS 116 Leases sets out principles for recognition, measurement, presentation and disclosure of leases and requires lessees to account for all leases, except short term leases and low value items, under a single on- balance sheet lease accounting model. A lessee recognizes lease liabilities to make lease payments and right-of-use assets representing the right to use the underlying assets.

The Company recognizes right-of-use assets at the commencement date of the lease (i.e., the date the underlying asset is available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any re-measurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognized, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Right-of-use assets are depreciated on a straightline basis over the shorter of the lease term and the estimated useful lives of the assets.

At the commencement date of the lease, the company recognizes lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees.

In calculating the present value of lease payments, the company uses its incremental borrowing rate at the lease commencement date because the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is re-measured if there is a modification, a change in the lease term, a change in the lease payments (e.g., changes to future payments resulting from a change in an index or rate used to determine such lease payments) or a change in the assessment of an option to purchase the underlying asset.

Lease income from operating leases where the Company is a lessor is recognised in income on a straight-line basis over the lease term unless the receipts are structured to increase in line with expected general inflation to compensate for the expected inflationary cost increases. The respective leased assets are included in the balance sheet based on their nature.

Leases are classified as finance leases when substantially all of the risks and rewards of ownership transfer from the company to the lessee. Amounts due from lessees under finance leases are recorded as receivable at the company''s net investment in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the net investment outstanding in respect of the lease. Operating lease payments are recognised as an income in the statement of profit and loss on a straight line basis over the lease term, unless the receipt from lessee is structured to increase in line with general inflation and compensate for the lessor''s expected cost increase.

2.22 Segment reporting:

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker (CODM). Chief executive officer (CEO) and Managing director (MD) of the Company has been identified as CODM who regularly monitors and reviews the operating results and the financial position of the Company, and makes strategic decisions.

2.23 Dividends:

Dividends paid / payable shall be recognised in the year in which the related dividends are approved by Shareholders or the Board of Directors as appropriate. The amount is recognised directly in equity.

2.24 Recent pronouncements :

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) Amendment Rules, 2023, applicable from April 1st, 2023, as below:

Ind AS 1 - Material accounting policies

The amendments mainly related to shifting of disclosure of erstwhile ''significant accounting policies'' in the notes to the financial statements to material accounting policy information requiring companies to reframe their accounting policy to make them more entity specific. This amendment align with the ''material'' concept already required under International Financial Reporting standards (IFRS).

Ind AS 8 - Definition of accounting estimates

The amendments specify definition of ''change in accounting estimate'' replace with the definition of ''accounting estimates''.

Ind AS 12 - Income taxes- Annual improvement to Ind AS (2021)

The amendments clarifies that in cases of transactions where equal amounts of assets and liabilities are recognised on initial recognition, the initial recognition exemption does not apply. Also, if a company has not yet recognised deferred tax assets and deferred tax liability on right of use assets and lease liabilities or has recognised deferred tax assets / liabilities on net basis, that company shall have to recognise deferred tax assets / liabilities on gross basis bases on the carrying amount of assets and liabilities.

The company does not expect aforesaid amendments to have significant impact on the financial statements.

(47) Segment Information : The company''s Chief operating decision maker (CODM) has identified only one business segment i.e. Mmanufacturing and Sales of Cement and its only production facility is located in India. There are no other separate reportable segment. The entire revenue of the company has been generated by way of domestic sales in North Eastern states. There are no individual customers or a particular group contributing to more than 10% of revenue. The company does not hold any non-current assets in foreign countries.

(48) Financial risk management:

Financial risk factors

The Company''s principal financial liabilities includes borrowings, trade payable and other financial liabilities. The main purpose of these financial liabilities is to finance the Company''s assets and operations. The Company''s principal financial assets include trade receivables, cash and cash equivalents and other financial assets that are derived directly from its operations. The company is exposed to credit risk, liquidity risk and market risk. The Company''s senior management oversees the management of these risks and the appropriate financial risk governance framework for the Company is in place. The senior management provides assurance that the Company''s financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company''s policies and risk objectives. The Audit Committee and the Board are regularly apprised of these risks every quarter and each such risk and mitigation measures are extensively discussed and the same are summarized below:

The Company''s activities expose it to a variety of financial risks: credit risk, liquidity risk and market risk. The Company''s primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. The Company''s exposure to credit risk is influenced mainly by the individual characteristic of each customer.

(a) Credit Risk: Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, thereby leading to a financial loss. The company is exposed to credit risk from its operating activities primarily from trade receivables including deposits with banks and financial institutions and other financial instruments.

(i) Trade receivables: Customer credit risk is managed by the company through its established policy, procedures and control relating to customer credit risk management. Trade receivables are non interest bearing and are generally carrying 30-45 days credit term. Outstanding debtors are regularly monitored by the sales and collection team of the company. Further the company receives security deposits from its customers which mitigate the credit risk. The ageing of trade receivables as of balance sheet date is as below:

(b) Liquidity Risk: Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or other financial asset. Due to the nature of the underlying business, the company maintains sufficient cash and liquid investments available to meet its obligation. Management of the company regularly monitors rolling forecast of the company''s liquidity position and cash and cash equivalents on the basis of expected cash flows.

The liquidity risk is managed by Company''s financial policy, which aims to ensure the availability of sufficient net funds to meet the company''s financial commitments with minimal additional cost.

(i) Financial arrangements : The company had access to the working capital facilities from the bank amounting Rs. 2,500.00 Lacs (Outstanding balance Rs. 2,405.66 Lacs as at 31^st March''2023) which are expiring in one year, subject to the renewal of the same by the banking authorities. A part from the working capital facility, company has also following outstanding financial liabilities :

50. Other Statutory information :

i) The Company do not have any benami property, and no proceeding has been initiated against the Company for holding any benami

property.

ii) The Company do not have any transactions with companies struck off.

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

iv) The Company have not traded or invested in crypto currency or virtual currency during the financial year.

v) The Company have not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries)

with the understanding that the Intermediary shall:

a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company

(ultimate beneficiaries) or

b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

vi) The Company have not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the

understanding (whether recorded in writing or otherwise) that the Group shall:

a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding

party (ultimate beneficiaries) or

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

vii) The Company have not any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed

as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961".

viii) The Company have not declared willful defaulter by any banks or any other financial institution at any time during the financial year.

(51) Previous year''s figures have been regrouped and/ or re-arranged wherever necessary, to confirm to current year''s classification.

(52) The financial statements are approved by the Audit Committee at its meeting held on 30th May'' 2023 and by the Board of Directors on the same date.

In terms of our report of even date

For P.K. Lakhani & Co., For & on behalf of the Board of Directors

Chartered Accountants,

Firm Registration No. 014682-N

(Kamakhya Chamaria) (Santosh Kumar Bajaj)

Vice Chairman & Managing Director

Director

(CA. Sandeep Gulati) (Rajesh Aggarwal) (Mukesh Kumar Shovasaria)

Partner Chief Financial Officer Chief Executive Officer

M.No. 509230

Gurgaon, 30th May'' 2023 (Ms. Rachna Gambhir)

Company Secretary

---

Mar 31, 2018

(1) Contingent liabilities not provided for:

(a) Corporate Guarantee''s given to Financial Institutions/ Banks on behalf of wholly owned subsidiaries: Rs. 3,133.92 Lakhs ( Rs. 3,519.64 Lakhs as at 31^st March'' 2017 and Rs. 3,447.71 Lakhs as at 31^st March'' 2016)

(b) Claims against the company not acknowledged as debts: Disputed demands of Entry - tax /Income -Tax matters pending before the Appellate Authorities: Rs. 90.79 Lakhs ( Rs.259.92 lakhs as at 31^st March'' 2017 and 31^st March'' 2016)

(c) Fixed Deposit Receipts pledged with the banks / others: Rs. 92.69 Lakhs (Rs. 64.70 Lakhs as at 31^st March'' 2017 and Rs. 7.73 Lakhs as at 31^st March'' 2016)

(38) There are no Micro, Small and Medium enterprises, as defined in the Micro, Small and Medium Enterprises Development Act, 2006 to whom the company owes dues on account of principal amount together with interest and accordingly no additional disclosure have been made. The above information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of the information/ documents available with the company.

(2). Employee Defined Benefits: (i) Leave Obligations :

Under leave encashment scheme, the company allows its employees to en-cash accumulated leave over and above thirty days. So, accumulated leave encashment liability for up to 30 days period is classified as non -current liability and over the period of 30 days is covered under current liability. Non -current liability of leave encashment is discounted @ 9% and carried at current cost in the financial statements and resultant variation is accounted for in the finance cost / employee benefit expenses of the profit and loss statement.

(ii) Gratuity :

The company has a defined benefit gratuity plan. Every employee who has completed five years or more of service is entitled to gratuity on terms not less than the provisions of the Payment of Gratuity Act, 1972.

(iii) Risk Exposure:

Through its defined benefit plans the Company is exposed to a number of risks, significant of which are as follows:

(a) Investment risk: The present value of the defined benefit plan liability is calculated using a discount rate determined by reference to the Government of India bonds. If the return on plan asset is below this rate, it will create a plan deficit.

(b) Interest Risk: A decrease in the interest rate on plan assets will increase the plan liability.

(c) Life Expectancy: The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and at the end of the employment. An increase in the life expectancy of the plan participants will increase the plan liability.

(d) Salary growth risk : The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. An increase in the salary of the plan participants will increase the plan liability.

(iv) The company has recognized expenses of Rs. 22.66 lakhs (Rs. 19.84 lakhs as at 31^st March, 2017) towards the defined contribution plan.

(3) Capital management

(a) Risk Management : The company''s objective when managing capital are to :

- Safeguard their ability to continue as a going concern of the company, so that they can provide returns for shareholders and benefits for other stakeholders

- Maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the company may adjust the amount of dividend to shareholders, return capital to shareholders or issue new shares.

(b) Dividend: During the year, management of the company has decided not to declare any dividend and accumulated its profits for future projects and consolidates its operating efficiency.

(4) Related Party disclosures: Name of the related parties where control exists Nature of relationship

Meghalaya Minerals & Mines Ltd. Subsidiary Company

Badarpur Energy Pvt. Ltd. Subsidiary Company

Cement International Ltd. Subsidiary Company

Goombira Tea Co. Ltd. Subsidiary Company

Singlacherra Tea Co. Pvt. Ltd. Subsidiary Company

Chargola Tea Co. Pvt. Ltd. Subsidiary Company

Valley Strong Cements (Assam) Ltd. Subsidiary Company

Other related parties : Nature of relationship (I) Enterprises Influenced by KMP:

Valley Strong Cements Ltd. Enterprises influenced by Key Management personnel

Dony Polo Udyog Ltd. Enterprises influenced by Key Management personnel

Meghalaya Cements Ltd. Enterprises influenced by Key Management personnel

Om InfTacon Pvt. Ltd. Enterprises influenced by Key Management personnel

Nature of relationship (II) Key Management Personnel :

Sh. Kamakhya Chamaria Vice Chairman and Managing Director

Sh. Bijay Kumar Garodia Director

Sh. Santosh Kumar Bajaj Director

Sh. Mahendra Kumar Agarwal Vice Chairman

Sh. Prahlad Rai Chamaria Non- Executive Director

Sh. Tanuj Chamaria Son of Sh. Kamakhya Chamaria, Vice Chairman and

Managing Director

Sh. Mukesh Kumar Shovasaria Chief Executive Officer

Sh. Sushil Kumar Kothari Chief Financial Officer (Resigned w.e.f. 26.02.2018)

Ms. Saakshi Manchanda Company Secretary (joined w.e.f. 14.11.2016 and resigned

w.e.f. 05.07.2018)

(4) The company deals in only one Segment i.e. cement manufacturing and trading which is the only identified operating segment of the company. There is no separate reportable segment as required by Ind AS - 108 “Operating Segments”. The entire revenue of the company has been generated by way of domestic sales.

(5) Company has received/ recognized Rs. Nil (Rs. 258.84 lakhs as at 31^st March'' 2017, Rs. 89.54 Lakhs as at 01^st April'' 2016) being 50% of company''s claim for refund of excise duty as revenue in the books of accounts. Presently matter regarding company''s claim for refund of differential Excise Duty is pending before the Hon''ble Supreme Court of India.

(6) Financial risk management: The Company''s activities are exposed to a variety of financial risks: credit risk, liquidity risk and interest rate risk.

(a) Credit Risk : Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The company is exposed to credit risk from its operating activities primarily from trade receivables including deposits with banks and financial institutions and other financial instruments.

(ii) Financial instruments and deposits: Credit risk from balance with banks and financial institutions is managed by the finance department of the company. Investments of surplus funds are made only with approved counterparties in accordance with the company''s policy. Loans are given to body corporate are as per the company policy and the receipt of repayment are reviewed on regular basis. Other financial assets are considered to be of good quality and there is no significant risk.

(a) Liquidity Risk : Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or other financial asset. Due to the nature of the underlying business, the company maintains sufficient cash and liquid investments available to meet its obligation. Management of the company regularly monitors rolling forecast of the company''s liquidity position and cash and cash equivalents on the basis of expected cash flows.

The company had access to the working capital facilities from the bank amounting Rs. 2,500.00 lakhs (Outstanding balance Rs. 2,476.03 lakhs as at 31^st March''2018) which are expiring in one year, subject to the renewal of the same by the banking authorities. A part from the working capital facility, company has also following outstanding borrowings from banks and financial institutions:

(a) 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 rate. As the company''s borrowings except borrowing from market are fixed rate borrowings; they are carried out at Amortized cost and are not subject to interest rate risk as defined in Ind AS 107.

(7) First time adoption of Ind AS :

These are the company''s first financial statements prepared in accordance with Ind AS. The accounting policies set out in Note 2, have been applied in preparing the financial statements for the year ended 31^st March, 2018, the comparative financial statements for the year ended 31^st March 2017 and in the preparation of opening Ind AS Balance Sheet at 1^st April, 2016.

In preparing its opening Ind AS Balance Sheet, the company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies (Accounting Standards) Rules, 2006 and other relevant provisions of the Act (Indian GAAP).

An explanation of how the transition from previous GAAP to Ind AS has affected the Company''s financial position, financial performance and cash flows is set out in the following tables and notes.

A. Exemptions and exceptions availed

Following are the applicable Ind AS optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS.

A.1 Ind AS optional exemptions A.1.1 Deemed cost

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognized in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP except Land and building that measure as Fair value and use that as its deemed cost as at the date of transition. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets.

Accordingly, the Company has elected to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying value except Land and building that measure as Fair value.

A.1.3 Investments in subsidiaries

In financial statements, a first-time adopter that subsequently measures an investment in a subsidiary at cost, may measure such investment at cost (determined in accordance with Ind AS 27) or deemed cost (fair value or previous GAAP carrying amount) in its opening Ind AS balance sheet. Selection of fair value or previous GAAP carrying amount for determining deemed cost can be done for each subsidiary.

Accordingly, the Company has elected to measure all of its investment in subsidiary at their previous GAAP carrying value.

A.2 Ind AS mandatory exceptions A.2.1 Estimates

The Company estimates in accordance with Ind ASs at the date of transition shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.

Ind AS estimates as at 1 April 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP.

A.2.2 Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of the fact and circumstances that exits at the date of transition to Ind AS.

A.2.4 Cash flow Statements

The transition from Indian GAAP to Ind AS has no material impact on the Cash flow Statement.

Notes to first-time adoption:

Note 1: Property, plant and equipment

Company has elected to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying value except Land and building that measure as Fair value and the difference of the same are recognized in retained earnings.

Note 2 : Government grant

As per Ind AS 20, government grants related to assets, shall be presented in the Balance Sheet by setting up the grant as deferred income. Hence the Company has accounted the government grant received towards assets as per the requirement of Ind AS 20 by creating a deferred government grant. In subsequent year this deferred government grant has been Amortized over the useful life of the assets

Note 3 : Impairment of financial assets

The company has impaired its investment in and Loan given to one of its subsidiary company according to the accounting policies related to impairment of financial assets in Note 2. Hence the company has written off its investment and Loan given to its subsidiary company and recognized in retained earnings.

Note 4 : Financial Corporate Guarantee Contract

The Company has given guarantee on behalf of its subsidiary. As per Ind AS 109, the Company has recognized a guarantee fee income for giving guarantee on behalf of subsidiary for loans taken by subsidiaries

Note 5 : Employee benefit obligation

In accordance with Ind AS “Employee Benefits” re-measurement gains and losses on post-employment defined benefit plans are recognized in profit or loss.

Note 6: Investments in equity shares

The Company holds investment in equity shares of entities other than in subsidiaries, associate and joint venture. Under previous GAAP such investments were measured at cost.

As per Ind AS 109, these investments have been measured at fair value. The Company has categorized these investments as fair value through other comprehensive income (FVTOCI) and any changes in fair value of those investment has been recognized in other comprehensive income.

Note 7: Deferred tax

The various transitional adjustments lead to different temporary differences. According to the accounting policies in Note 2, the Company has to account for such differences. Deferred tax adjustments are recognized in correlation to the underlying transaction either in retained earnings or a separate component of equity.

Note 8 : Retained earnings

Retained earnings as at 1 April, 2016 has been adjusted consequent to the above Ind AS transition adjustments.

Note 9 : Statement of cash flows

The transition from Indian GAAP to Ind AS has not had a material impact on the statement of cash flows.

(48) Previous year''s figures have been regrouped and/ or re-arranged wherever necessary, to confirm to current year''s classification.

(49) The financial statements are approved by the Audit Committee at its meeting held on 01^st June, 2018 and by the Board of Directors on the same date.

---

Mar 31, 2016

1. Terms/Rights attached to equity shares

The company has only one class of equity shares having par value of Rs. 10.00 per share. Each holder of Equity shares is entitled to one vote per share.

In the event of liquidation of the company, the holders of the equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

2. Working Capital Term Loan (WCTL) of Rs. 305.56 lakhs (sanctioned amount Rs. 1,000.00 lakhs) from a bank is repayable in 36 equal monthly installments of Rs. 27.78 lakhs commencing from January'' 2014. The Loan is secured by extension of charge on the current assets as well as fixed assets (both present and future) of the company. Further, the loan has been guaranteed by personal gurantees of some of Directors of the Company.

3. Rupee Term Loans (RTL) of Rs. 936.85 lakhs (sanctioned amount Rs. 2,000.00 lakhs) is repayable from April''2015 in monthly installments of Rs. 40.00 lakhs. The loan is secured by first charge on fixed and immovable assets of company''s assets on pari -passu basis and by second charge on fixed and immovable assets of the company . The loans has also been guaranteed by personal guarantees of some of the Directors of the Company.

4. Hire Purchase Finance is secured by hypothecation of vehicles / equipments and is repayable within three to four years.

5. Loans from Other parties are unsecured in nature and due for repayment after 12 months as on the reporting date. The company does not have any existing default as at the date of balance sheet.

6. The above amount includes

Secured borrowings 274,978,166 248,853,598

7. Working Capital facilities from banks are secured by first charge on current assets of the Company and second charge on fixed assets of the Company. The Working capital facilities from banks have also been guaranteed by some of the Directors of the Company.

8. There are no Micro, Small and Medium enterprises, as defined in the Micro, Small and Medium Enterprises Development Act, 2006 to whom the company owes dues on account of principal amount together with interest and accordingly no additional disclosure have been made. The above information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of the information available with the company.

9. Employee Defined Benefits:

10. Defined Contribution Plans

The Company has recognized an expense of Rs.20,44,022/- (Previous year Rs 18,85,018/-) towards the defined contribution plans.

11. Defined Benefit Plans - As per Actuarial Valuation as at 31st March''2016

12. Disclosure in respect of Related Parties:

Pursuant to Accounting Standard - 18 "Related Party Disclosures" issued by ICAI, following are the related parties, description of their relationships and transactions carried out with them during the year in the ordinary course of business:

13. In pursuance of AS -28 "Impairment of Assets" issued by ICAI, the company reviewed its carrying cost of assets with value in use on the basis of future earnings and on such review, management is of the view that in the current financial year impairment of assets is not considered necessary.

14. In the opinion of the management and to the best of their knowledge and belief the value on realization of loans, advances and other current assets in the ordinary course of business will not be less than the amount as they are stated in the financial statements.

15. The Investment of the company includes the investment of Rs. 31.77 crores in " Badarpur Energy Pvt. Ltd.'' (Wholly owned subsidiary company of Barak Valley Cements Ltd.).The Operations of wholly owned subsidiary was discontinued since July 2014 due to non availability of required quality and quantity of biomass and still it is lying stopped. The Board of Directors of the Company has constituted a Committee to study and analyze the viability of the Plant and to submit its report to the Board after taking into consideration the necessary and relevant factors so that the Board can decide on the future course of action. Accordingly management of the company considered that there is no permanent decline in value of investment in subsidiary in anticipation that plant of the subsidiary might be operational in the future.

16. During the year company has claimed differential excise duty refund of Rs. 89.54 Lakhs (Previous Year: 63.10 Lakhs) for the current year 2015 -16 and recognized the same as revenue in the books of accounts. Presently matter regarding company''s claim for refund of differential Excise Duty is pending before the Hon''ble Supreme Court of India. In this matter revenue is recognized on the basis of Interim Order dated 13th January'' 2012 passed by the Hon''ble Supreme Court of India in case of "VVF Ltd. and Others" and similar relief granted to other companies located in NE region.

17. Out of the Subsidy Receivables amounting to Rs. 1,301.98 Lakhs, Rs. 603.45 Lakhs are related to Transport Subsidy and Central Capital Investment Subsidy claims of the company which are outstanding as receivable for more than five years. However, management of the company is treated the same as good and is of the opinion that the same will be realized in due course of time.

18. An amount of Rs. 58.89 Lakhs (Previous year : Rs. 58.89 Lakhs) has been deposited by the company with the revenue authorities against the disputed Entry Tax demand of earlier years. The same has been deposited ''under protest'' and is shown under ''Other Loans and Advances'' forming part of current assets.

19. The Ministry of Corporate Affairs has amended Schedule II to the Companies Act, 2013 requiring mandatory componentization of fixed assets for financial statements. Accordingly technical evaluation of fixed assets has been undertaken during the year and it was observed that useful life of any significant individual part of an asset is not different from the relevant total asset.

20. Previous year''s figures have been regrouped and/ or re-arranged wherever necessary, to confirm to current year''s classification.

In terms of our report of even date

---

Mar 31, 2015

(a) Terms/Rights attached to equity shares

The company has only one class of equity shares having par value of Rs, 10.00 per share. Each holder of Equity shares is entitled to one vote per share.

In the event of liquidation of the company, the holders of the equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

As per records of the company, including its register of shareholders/members and other declaration received from shareholders regarding beneficial interest, the above shareholding represent both legal and beneficial owner.

(i) Rupee Term Loan of Rs, 284.00 lakhs (sanctioned amount Rs, 2,000.00 lakhs) from a bank is repayable in 59 equal monthly installments of Rs, 33.00 lakhs and 1 installment of Rs, 53.00 lakhs ending in September' 2015. The Loan is secured by first charge on all movable and immovable assets (both present and future) of the company. Further, the loan has been guaranteed by personal guarantees of some of Directors of the Company.

(ii) Working Capital Term Loan (WCTL) of Rs, 638.89 lakhs (sanctioned amount Rs, 1,000.00 lakhs) from a bank is repayable in 36 equal monthly installments of Rs, 27.78 lakhs commencing from January' 2014. The Loan is secured by extension of charge on the current assets as well as fixed assets (both present and future) of the company. Further, the loan has been guaranteed by personal guarantees of some of Directors of the Company.

(iii) Rupee Term Loans (RTL) of Rs, 1,336.85 lakhs (sanctioned amount Rs, 2,000.00 lakhs) is repayable from April' 2015 in monthly installments of Rs, 40.00 lakhs. The loan is secured by first charge on fixed and immovable assets of company's assets on pari passu basis and by second charge on fixed and immovable assets of the company . The loans has also been guaranteed by personal guarantees of some of the Directors of the Company.

(iv) Hire Purchase Finance is secured by hypothecation of vehicles / equipments and is repayable within three to four years.

(v) Loans from Other parties are unsecured in nature and due for repayment after 12 months as on the reporting date. The company does not have any existing default as at the date of balance sheet.

b. Working Capital facilities from banks are secured by first charge on current assets of the Company and second charge on fixed assets of the Company. The Working capital facilities from banks have also been guaranteed by some of the Directors of the Company.

(1) Capital Commitments

The estimated amount of Contracts remaining to be executed on Capital Account and other capital commitment not provided for amounts to Rs, 41.85 Lakhs (Previous year: Rs, 62.77 Lakhs)

(2) Contingent liabilities not provided for:

(a) Corporate Guarantee's given to Financial Institutions/ Banks on behalf of wholly owned subsidiaries: Rs, 3,296.07 Lakhs (Previous year – Rs, 3,529.25 Lakhs)

(b) Claims against the company not acknowledged as debts: Disputed demands of Income –Tax / Entry- Tax matters pending before the Appellate Authorities: Rs, 259.92 lakhs (Previous year – Rs, 409.19 lakhs)

(3) Fixed Deposit Receipts pledged with the banks / Others : Rs, 22.73 Lakhs (Previous Year : Rs, 37.73 Lakhs)

(4) There are no Micro, Small and Medium enterprises, as defined in the Micro, Small and Medium Enterprises Development Act, 2006 to whom the company owes dues on account of principal amount together with interest and accordingly no additional disclosure have been made. The above information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of the information available with the company.

(5) Employee Defined Benefits:

(a) Defined Contribution Plans

The Company has recognized an expense of Rs, 18,85,018/- (Previous year Rs, 17,57,578/-) towards the defined contribution plans.

(6) In pursuance of AS -28 "Impairment of Assets" issued by ICAI, the company reviewed its carrying cost of assets with value in use on the basis of future earnings and on such review, management is of the view that in the current financial year impairment of assets is not considered necessary.

(7) In the opinion of the management and to the best of their knowledge and belief the value on realization of loans, advances and other current assets in the ordinary course of business will not be less than the amount as they are stated in the financial statements.

(8) The company deals in only one Segment i.e. cement manufacturing. There is no separate reportable segment as required by AS – 17 "Segment Reporting".

(9) During the year company has claimed differential excise duty refund of Rs, 63.10 Lakhs (Previous Year: Rs, 39.57 Lakhs) for the current year 2014 -15 and recognized the same as revenue in the books of accounts. Presently matter regarding company's claim for refund of differential Excise Duty is pending before the Hon'ble Supreme Court of India. In this matter revenue is recognized on the basis of Interim Order dated 13th January' 2012 passed by the Hon'ble Supreme Court of India in case of "VVF Ltd. and Others" and similar relief granted to other companies located in NE region.

(10) Out of the Subsidy Receivables amounting to Rs, 1,254.44 Lakhs, Rs, 660.48 Lakhs is related to Transport Subsidy and Central Capital Investment Subsidy claims of the company which is outstanding as receivable for more than five years. However, management of the company is treated the same as good and is of the opinion that the same will be realized in due course of time.

(11) An amount of Rs, 58.89 Lakhs (Previous year : Rs, 38.11 Lakhs) has been deposited by the company with the revenue authorities against the disputed Entry Tax demand of earlier years. The same has been deposited 'under protest' and is shown under 'Other Loans and Advances' forming part of current assets.

(12) Previous year's figures have been regrouped and/ or re-arranged wherever necessary, to confirm to current year's classification.

---

Mar 31, 2014

1. CORPORATE INFORMATION

Barak Valley Cements Limited (the company) is a public limited company incorporated under the provisions of the Companies Act, 1956. The shares of the company are listed on National Stock Exchange and Bombay Stock Exchange of India. The manufacturing unit of the company is located at Badarpurghat, Distt. Karimganj, Assam. The company is engaged in the manufacturing and selling of various brands of Cement primarily in north eastern states.

2. (a) Terms/Rights attached to equity shares

The Company has only one class of equity shares having par value of Rs. 10.00 per share each holder of equity shares is entitled to one vote per share.

In the event of liquidation of the company, the holders of the equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

3. (i) Rupee Term Loan of Rs. 667.00 lakhs (sanctioned amount Rs. 2,000.00 lakhs) from a bank is repayable in 59 equal monthly installments of Rs. 33.00 lakhs and 1 installment of Rs. 53.00 lakhs ending in September'' 2015. The Loan is secured by first charge on all movable and immovable assets (both present and future) of the company. Further, the loan has been guaranteed by personal gurantees of some of Directors of the Company.

(ii) Working Capital Term Loan(WCTL) of Rs. 972.22 lakhs (sanctioned amount Rs. 1,000.00 lakhs) from a bank is repayable in 36 equal monthly installments of Rs. 27.78 lakhs commencing from January'' 2014. The Loan is secured by extension of charge on the current assets as well as fixed assets (both present and future) of the company. Further,the loan has been guaranteed by personal gurantees of some of Directors of the Company.

(iii) Rupee Term Loans of Rs. 1,936.56 lakhs from financial institution is consisting of RTL of Rs. 1,790.00 Lakhs which is repayable from April'' 2015 in monthly installments of Rs. 40.00 lakhs each and FITL of Rs. 146.56 Lakhs which is repayable from April'' 2015 in equal monthly installments of Rs. 8.15 Lakhs. The loan is secured by first charge on fixed and immovable assets of company''s assets on pari -passu basis and by second charge on fixed and immovable assets of the company. The loans has also been guaranteed by personal guarantees of some of the Directors of the Company.

(iv) Hire Purchase Finance is secured by hypothecation of vehicles/equipments and is repayable within three to four years.

(v) Loans from Other parties are unsecured in nature and due for repayment after 12 months as on the reporting date. The company does not have any existing default as at the date of balance sheet.

4. Capital Commitments

The estimated amount of Contracts remaining to be executed on Capital Account and other capital commitment not provided for amounts to Rs. 62.77 Lakhs (Previous year: Rs. 170.24 Lakhs)

5. Contingent liabilities not provided for:

(a) Corporate Guarantee''s given to Financial Institutions/ Banks on behalf of wholly owned subsidiaries: Rs. 3,529.25 Lakhs (Previous year - Rs. 2,948.72 Lakhs)

(b) Claims against the company not acknowledged as debts: Disputed demands of Income-Tax / Entry-Tax matters pending before the Appellate Authorities: Rs. 409.19 lakhs (Previous year - Rs. 1,028.76 lakhs)

6. Fixed Deposit Receipts pledged with the banks / Others : Rs. 37.73 Lakhs (Previous Year : Rs. 35.25 Lakhs)

7. There are no Micro, Small and Medium enterprises, as defined in the Micro, Small and Medium Enterprises Development Act, 2006 to whom the company owes dues on account of principal amount together with interest and accordingly no additional disclosure have been made. The above information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of the information available with the company.

8. In pursuance of AS -28 "Impairment of Assets" issued by ICAI, the company reviewed its carrying cost of assets with value in use on the basis of future earnings and on such review, management is of the view that in the current financial year impairment of assets is not considered necessary.

9. In the opinion of the management and to the best of their knowledge and belief the value on realization of loans, advances and other current assets in the ordinary course of business will not be less than the amount as they are stated in the financial statements.

10. The company deals in only one Segment i.e. cement manufacturing. There is no separate reportable segment as required by AS - 17 "Segment Reporting".

11. During the year company has claimed differential excise duty refund of Rs. 39,57,402/- for the year 2013 -14 and recognized the same as revenue in the books of accounts. Presently matter regarding company''s claim for refund of differential Excise Duty is pending before the Hon''ble Supreme Court of India. In this matter revenue is recognized on the basis of Interim Order dated 13th January'' 2012 passed by the Hon''ble Supreme Court of India in case of "VVF Ltd. and Others" and similar relief granted to other companies located in NE region.

12. Out of the Subsidy Receivables amounting to Rs. 1,147.72 Lakhs, Rs. 660.48 Lakhs is related to Transport Subsidy and Central Capital Investment Subsidy claims of the company which is outstanding as receivable for more than five years. However, management of the company is treated the same as good and is of the opinion that the same will be realized in due course of time.

13. An amount of Rs. 38.11Lakhs has been deposited by the company with the revenue authorities against the disputed Entry Tax demand of earlier years. The same has been deposited ''under protest'' and is shown under ''Other Loans and Advances'' forming part of current assets.

14. Previous year''s figures have been regrouped and/ or re-arranged wherever necessary, to confirm to current year''s classification.

---

Mar 31, 2013

1. CORPORATE INFORMATION

Barak Valley Cements Limited (the company) is a public limited company incorporated under the provisions of the Companies Act, 1956. The shares of the company are listed on National Stock Exchange and Bombay Stock Exchange of India. The manufacturing unit of the company is located at Badarpurghat, Distt. Karimganj, Assam. The company is engaged in the manufacturing and selling of various brands of Cement primarily in north eastern states.

(2) Capital Commitments

The estimated amount of Contracts remaining to be executed on Capital Account and other capital commitment not provided for amounts to Rs. 170.24 Lakhs (Previous Year: Rs.153.13 Lakhs)

(3) Contingent liabilities not provided for:

(a) Bank Guarantee issued by Banks Nil (Previous Year - Nil)

(b) Corporate Guarantee''s given to Financial Institutions/ Banks on behalf of wholly owned subsidiaries: Rs. 2,948.72 Lakhs (Previous Year - Rs. 6,087.43 Lakhs)

(c) Claims against the company not acknowledged as debts: Disputed demands of Income -Tax / Entry- Tax matters pending before the Appellate Authorities: Rs.1,028.76 lakhs (Previous Year - Rs. 906.20 lakhs)

(4) Fixed Deposit Receipts pledged with the banks / Others : Rs. 35.25 Lakhs (Previous Year : Rs. 42.25 Lakhs)

(5) There are no Micro, Small and Medium enterprises, as defined in the Micro, Small and Medium Enterprises Development Act, 2006 to whom the company owes dues on account of principal amount together with interest and accordingly no additional disclosure have been made. The above information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of the information available with the company.

(6) Employee Defined Benefits:

(a) Defined Contribution Plans

The Company has recognized an expense of Rs.16,22,657/-(Previous year Rs 15,83,940/-) towards the defined contribu- tion plans.

(b) Defined Benefit Plans - As per Actuarial Valuation as at 31st March''2013

(7) In pursuance of AS -28 "Impairment of Assets" issued by ICAI, the company reviewed its carrying cost of assets with value in use on the basis of future earnings and on such review, management is of the view that in the current financial year impairment of assets is not considered necessary.

(8) In the opinion of the management and to the best of their knowledge and belief the value on realization of loans, advances and other current assets in the ordinary course of business will not be less than the amount as they are stated in the financial statements.

(9) The company deals in only one Segment i.e. cement manufacturing. There is no separate reportable segment as required by AS - 17 "Segment Reporting".

(10) Previous year''s figures have been regrouped and/ or re-arranged wherever necessary, to confirm to current year''s Classifi- cation.

---

Mar 31, 2012

1. CORPORATE INFORMATION

Barak Valley Cements Limited (the company) is a public limited company incorporated under the provisions of the Companies Act, 1956. Its shares are listed on National Stock Exchange and Bombay Stock Exchange of India. The company is engaged in the manufacturing and selling of various brands of Cement primarily in North Eastern States.

BASIS OF PREPARATION

The financial statements of the company have been prepared in accordance with the generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention basis.

(2) Capital Commitments

The estimated amount of Contracts remaining to be executed on Capital Account and other capital commitment not provided for amounts to Rs. 153.13 Lakhs (Previous year: Rs.1,144.82 Lakhs)

(3) Contingent liabilities not provided for :

(a) Bank Guarantee issued by Banks : Nil (Previous Year - Nil)

(b) Corporate Guarantees given to Financial Institutions/ Banks on behalf of wholly owned subsidiaries: Rs. 6,087.43 Lakhs (Previous year - 4,440.20 Lakhs)

(c) Claims against the company not acknowledged as debts: Disputed demands of Income -Tax; pending before the Appellate Authorities: Rs.906.20 lakhs for Assessment Year 2005-06, 2006-07 and 2009-10 (Previous year - Rs. 624.57 lakhs)

(4) Fixed Deposit Receipts pledged with the banks / Others : Rs. 42.25 Lakhs (Previous Year : 32.25 Lakhs)

(5) There are no Micro, Small and Medium enterprises, as defined in the Micro, Small and Medium Enterprises Development Act, 2006 to whom the company owes dues on account of principal amount together with interest and accordingly no additional disclosure have been made. The above information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of the information available with the company.

(6) Employee Defined Benefits:

(a) Defined Contribution Plans: The Company has recognized an expense of Rs.15,83,940/- (Previous year Rs 14,49,227/-) towards the defined contribution plans.

(7) Disclosure in respect of Related Parties:

Pursuant to Accounting Standard - 18 " Related Party Disclosures" issued by ICAI, following are the related parties, description of their relationships and transactions carried out with them during the year in the ordinary course of business:

Subsidiary Companies

Meghalaya Minerals & Mines Ltd. , Badarpur Energy Pvt. Ltd. , Cement International Ltd., Goombira Tea Co. Ltd., Chargola Tea Co. Pvt. Ltd., Singlacherra Tea Co. Pvt. Ltd., Valley Strong Cements (Assam) Ltd.

Associates

M/s. Nefa Udyog, Meghalaya Cements Ltd., Balaji Udyog Ltd. North East Power & Infra Ltd., Valley Strong Cements Ltd.

Key Management Personnal and their relatives

Kamakhya Chamaria (Vice Chairman & Managing Director), Bijay Kumar Garodia (Chairman & Whole Time Director), Santosh Kumar Bajaj (Whole Time Director), J.L. Anchalia (Chief Financial Officer) , Prahlad Rai Chamaria (Non -Ex. Director), Mahendra Kumar Agarwal (Vice Chairman)

(8) In pursuance of AS -28 "Impairment of Assets" issued by ICAI, the company reviewed its carrying cost of assets with value in use on the basis of future earnings and on such review, management is of the view that in the current financial year impairment of assets is not considered necessary.

(9) In the opinion of the management and to the best of their knowledge and belief the value on realization of loans, advances and other current assets in the ordinary course of business will not be less than the amount as they are stated in the financial statements.

(10) The company deals in only one Segment i.e. cement manufacturing. There is no separate reportable segment as required by AS - 17 "Segment Reporting".

(11) Previous year figures :|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 confirm to this year's classification.

---

Mar 31, 2011

(1) Capital Commitments

The estimated amount of Contracts remaining to be executed on Capital Account and other capital commitment not provided for amounts to Rs. 1,144.82 Lakhs (Previous year: Rs.101.19 Lakhs)

(2) Contingent liabilities not provided for:

(a) Bank Guarantee issued by Banks Nil (Previous Year - Nil)

(b) Corporate Guarantee's given to Financial Institutions/ Banks on behalf of wholly owned subsidiaries: Rs. 4,440.20 Lakhs (Previous year - 3,800 Lakhs)

(c) Claims against the Company not acknowledged as debts: Disputed demands of Income -Tax; pending before the Appellate Tribunal: Rs.624.57 lakhs for Assessment Year 2005-06 and 2006-07 (Previous year - Rs. 556.87 lakhs)

(3) Fixed Deposit Receipts pledged with the banks / Others : Rs. 32.25 Lakhs (Previous Year : 17.07 Lakhs)

(4) Additional information in pursuant to the provision or paragraphs 3 & 4 of part II of schedule VI to the Companies Act, 1956 to the extent applicable to the Company:

(f) C.I.F. Value of Import : Nil (Previous Year - Nil)

(g) Earning in Foreign Exchange : Nil (Previous Year – Nil) (h) Expenditure in Foreign Currency : Nil (Previous Year - 1,47,378)

(Foreign Travelling expenses)

(5) During the year an amount of Rs. 17,50,593/- was paid to selling agents of the company as Sales Commission. (Previous Year Rs. 16,98,910/- )

(7) Remuneration paid to Director’s during the year: Rs. 78,00,000/- (Previous Year: Rs. 67,00,000/-)

(8) GOVT. SUBSIDIES

Insurance and interest subsidy amounting to Rs. 13,96,850/- (as at 31.03.2010 Rs. 12,96,688/-) and 95,21,014/- (as at 31.03.2010 Rs. 85,70,808/-) respectively has been adjusted from related overheads and shown as receivable forming part of loans and advances. Power subsidy amounting to Rs. 10,00,000/- ( as at 31.03.2010 : Rs. 10,00,000/-) has also been adjusted from Power & Fuel Expenses. During the year Excise Duty amounting to Rs. 5,22,22,738/- (previous year : 5,31,96,366/-) has been refunded back by Govt. of India.

(9) The Company has not received information from vendors regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and, hence disclosure relating to amounts unpaid at the year end, interest paid/ payable under this Act has not been given.

(10) Employee Defined Benefits:

(a) Defined Contribution Plans

The Company has recognized an expense of Rs.14,49,227/- (Previous year Rs 12,06,375/-) towards the defined contribution plans.

(11) Disclosure in respect of Related Parties:

Pursuant to Accounting Standard - 18 " Related Party Disclosures" issued by ICAI, following are the related parties, description of their relationships and transactions carried out with them during the year in the ordinary course of business:

Subsidiary Companies Meghalaya Minerals & Mines Ltd. Badarpur Energy Pvt. Ltd. Cement International Ltd. Goombira Tea Co.Pvt. Ltd. Chargola Tea Co. Pvt. Ltd. Singlacherra Tea Co. Pvt. Ltd. Valley Strong Cements (Assam) Ltd.

Associates M/s. Nefa Udyog M/s. Meghalaya Cements Ltd. M/s. Balaji Udyog Ltd. North East Power & Infra Ltd. Valley Strong Cements Ltd.

Key Management Personnel Kamakhya Chamaria (Vice Chairman & and their relates Managing Director) Bijay Kumar Garodia (Chairman & Whole Time Director) Santosh Kumar Bajaj (Whole Time Director) J.L. Anchalia (Chief Financial Officer) Prahlad Rai Chamaria (Non-Ex. Director) Mahendra Kumar Agarwal (Vice Chairman) Jagdish Prasad Shah.

(12) Earnings Per Share:

The following table reconciles the numerators and denominators used to calculate Basic and Diluted Earning per Share for the year ended 31st March 2011 and the year ended 31st March 2010.

(13) Balance of Sundry Debtors; Creditors and advances are subject to confirmation from respective parties.

(14) Expenditure on purchased software (ERP) and IT related expenses are written off over a period of three years.

(16) In pursuance of AS -28 "Impairment of Assets" issued by ICAI, the Company reviewed its carrying cost of assets with value in use on the basis of future earnings and on such review, management is of the view that in the current Financial Year impairment of assets is not considered necessary.

(17) Taxation

a) Current Tax:

The Company is eligible for 100% income-tax exemption under section 80-IC. The current year's provision for income-tax has been calculated on the basis of the provisions of Minimum Alternative Tax (MAT) under section 115JB and entitlement of Tax credit of MAT has been taken as per section 115JAA of the Income-Tax Act, 1961.

b) Deferred Tax:

Deferred tax liability has been recognized in respect of only those timing differences which originate during the tax holidays and are not likely to reverse during the tax holiday period to the extent income is subject to deduction during the tax holiday period as per Income Tax Act, 1961. Deferred tax assets are recognized only to the extent there is reasonable certainty of realization in future. The tax liability has been calculated at enacted future tax rates.

The tax impact for the above purpose has been arrived at by applying the enacted future tax rate for Indian companies under the Income Tax Act, 1961.

(18) In the opinion of the management, the current assets and loans and advances are having value, at least equal to the amount as they are stated in financial statements, if realised in the ordinary course of business.

(19) During the year, the Company has acquired 100% shareholding of Valley Strong Cements (Assam) Ltd., Goombira Tea Co. Pvt. Ltd., Singlacherra Tea Co. Pvt. Ltd. and Chargola Tea Co. Pvt. Ltd. , consequent to which these companies has become wholly owned subsidiaries of the company.

(20) The company deals in only one Segment i.e. cement manufacturing. There is no separate reportable segment as required by AS - 17 "Segment Reporting".

(21) Prior -period adjustments includes Entry - tax of previous accounting period and reversal of excess selling expenses provision made during earlier years.

(22) Previous year figures have been regrouped/ restated wherever necessary, to confirm to current year's classification.

(23) Schedule "1" to "21" forms an integral parts of the financial statements.

(24) Figures have been rounded off to the nearest rupee.

---

Mar 31, 2010

(1) Capital Commitments

The estimated amount of Contracts remaining to be executed on Capital Account and not provided for amounts to Rs. 101.19 Lakhs (Previous year: Rs. 51.53 Lakhs)

(2) Contingent liabilities not provided for:

(a) Bank Guarantee issued by Banks Mil (Previous Year - Rs. 2,25,000)

(b) Corporate Guarantees given to Financial Institutions/ Banks on beholf of wholly owned subsidiaries: Rs. 3,800 Lakhs (Previous year -3,100 Lakhs)

(c) Claims against the company not acknowledged as debts: Disputed demands of Income-Tax; pending before the Appellate Tribunal -. Rs.556.87 lakhs for Assessment Year 2005-06 and 2006-07 (Previous year- Rs. 282.55 lakhs)

(3) Additional information in pursuant to the provision or paragraphs 3 & 4 of port II of schedule VI to the Companies Act, 1956 to (he extent applicable to the company:

(4) During the year an amount of Rs. 16,98,910/- was paid to selling agents of the company as Sales Commission. (Previous Year Rs. 18,22,958/-)

(5) Remuneration paid to Directors during the year: Rs. 67,00,000/- (Previous Year: Rs. 47,00,000/-)

(6) GOVT. SUBSIDIES

Insurance and interest subsidy amounting to Rs. 12,96,688/- (as at 31.03.2009 Rs. 15,13,845/-) and 85,70,808/- (as at 31.03.2009 Rs. 59,26,031/-(respectively has been adjusted from related overheads and shown as receivable forming part of foans and advances. During the year Excise Duty amounting 1o Rs. 5,31,96,366/- (previous yeor : 5,58,10,177/-) has been refunded back by Govt, of India.

(7) The Company has not received information from vendors regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and, hence disclosure relating to amounts unpaid at the year end, interest paid/ payable under this Act has not been given.

(8) Employee Defined Benefits:

(a) Defined Contribution Plans

The Company has recognized an expense of Rs. 12,06,375/- (Previous year Rs 10,43,664/-) towards the defined contribution plans.

(9) Disclosure in respect of Related Parties;

Pursuant to Accounting Standard - 18 " Related Party Disclosures" issued by ICAI, following are the related parties, description of their relationships and transactions carried out with them during the year in the ordinary course of business:

Subsidiary Companies (with effect from 31.03.2006)

Meghalaya Minerals & Mines Lid. Badarpur Energy. Pvt. Ltd. Cement International Ltd. Goombira Tea Co. Pvt. Ltd. Chargola Tea Co. Pvt. Ltd. Singlacherra Tea Co. Pvt. Ltd.

Associates

M/s. Nefa Udyog

M/s. Meghalaya Cements Ltd.

M/s, Balaji Udyog Ltd.

North East Power & Infra Ltd.

Valley Strong Cements Lid.

Valley Strong Cements (Assam) Ltd.

Key Management Personnel and their relatives

Kamakhya Chamaria (Vice Chairman & Managing Director) Bijay Kumar Garodia (Chairman & Whole Time Director) Santosh Kumar Bajaj (Whole Time Director) J.L. Anchalia (Chief Financial Officer) Prahlad Rai Chamaria (Non-Ex. Director) Mahenctr^^KQJTtarAgarwol (Vice Chairman)

(10) Balance of Sundry Debtors; Creditors and advances are subject to confirmation from respective parties.

(11) In the opinion of the management the current assets and loans and advances are having value, at least equal to the amount as they are stated in financial statements, if realised in the ordinary course of business.

(12) Expenditure on purchased software (ERP) and IT rjetoTed^xpeljfiBs are written off over a period of three years.

(13) In pursuance of AS -28 "Impairment of Assets" issued by ICAI, (he company reviewed its carrying cost of assets with value in use on the basis of future earnings and on such review, management is of the view that in the current financial year impairment of assets is not considered necessary.

(14) Taxation

a) Current Tax:

The company is eligible for 100% income-tax exemption under section 80-IC. The current years provision for income-tax has been calculated on the basis of the provisions of Minimum Alternative Tax (MAT) under section 115JB and entitlement of Tax credit of MAT has been taken as per section 115JAA of the Income-Tax Act, 1961.

b) Deferred Tax:

Deferred tax liability has been recognized in respect of onSy those timing differences which originate during the tax holidays and are not likely to reverse during the tax holiday period to the extent income is subject to deduction during the tax holiday period as per Income Tax Act, 1961. Deferred lax assets are recognised only to the extent there is reasonable certainty of realization in future The tax liability has been calculated al enacted future tax rates.

The tax import for the above purpose hos been arrived a) by applying the enacted future tax rate for Indian companies under the Income Tax Act, 1961.

c) Fringe Benefit Tax

Provision for Fringe Benefit tax has been separately shown in the profit & ioss account in accordance with the guidance note issued by the 1CAI.

(15) The company deals in only one Segment i.e. cement manufacturing. There is no separate reportable segment as required by AS - 17 "Segment Reporting".

(16) Previous year figures have been regrouped/ restated wherever necessary.

(17) Figures have been rounded off to the nearest rupee.