Notes to Accounts of HEC Infra Projects Ltd.

Mar 31, 2025

9.1 Terms/ rights attached to equity shares

The Company has only one class of equity shares having a par value of '' 10/- per share. All these shares have the same rights and preferences with respect to the payment of dividend, repayment of capital and voting. The Company declares and pays dividends in Indian rupees. The interim dividend is declared and approved by Board of Directors. The final dividend proposed by the Board of Directors and is subject to the approval of the shareholders in the ensuing Annual General Meeting. 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. The distribution will be in proportion to the number of equity shares held by the shareholders.

^A Interest rate on loan is varying, which is linked to floating interest rate, from time to time.

#The repayment terms for the unsecured loan from the Body Corporate and Directors have not yet been finalized. Interest is charged at 9.50% p.a. on a portion of the unsecured loan, amounting to '' 5.60 Cr, attributed to Mrs. Rupal G. Shah, while the remaining portion is interest-free. Unsecured loans from Mr. Gaurang Shah (Director) and M/s. Kalp Agritech Pvt. Ltd. (Related Party) are interest-free.

*Cash Credit facilities from Bank of India is secured by way of hypothecation of stock, book debts and other current assets of the company both present and future and is also secured by personal guarantee of directors. It is also collaterally

secured by hypothecation of Plant & Machinery and Equitable mortgage of Following properties.(l) Office premises-61 6 th floor, Titanium, Nr. Prahaladnagar, Ahmedabad owned by the company (2) Corporate house no 6 , Sigma corporate 1, Sindhu Bhavan road, Bodakdev, Ahmedabad . Over and above this, personal property of Directors Shri Gaurang P. Shah & Smt Rupal G. Shah has been given as a Collateral security.

Interest rates on Cash Credit Accounts are varying , which are linked to base rate of Bank from time to time.

@@ Sanction Letter is not provided by financer.

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 Fair Value of Financial Assets & Liabilities measured at amortized cost

s The carrying amounts of trade receivables, trade payables, capital creditors and cash and cash equivalents are considered to be the same as their fair values, due to their short-term nature.

s The fair values of non-current borrowings are based on discounted cash flows using a current borrowing rate. They are classified as level 3 fair values in the fair value hierarchy due to the use of unobservable inputs, including own credit risk. They are subsequently measured at amortised cost at balance sheet date.

Credit Risk Management

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

The carrying amount of following financial assets represents the maximum credit exposure:

Other financial assets

The company maintains its Cash and cash equivalents and Bank deposits with banks having good reputation, good past track record and high quality credit rating and also reviews their credit-worthiness on an on-going basis.

Trade receivables

Trade receivables of the company are typically unsecured. The Company has major customers are government companies and government bodies. Hence, no credit risk is perceived by the Company.

Liquidity Risk

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses, Company treasury maintains flexibility in funding by maintaining availability under committed credit lines.

Management monitors rolling forecasts of the Company''s liquidity position and cash and cash equivalents on the basis of expected cash flows. This is generally carried out at local level in the operating companies of the Company in accordance with practice and limits set by the Company. These limits vary by location to take into account the liquidity of the market in which the entity operates. In addition, the Company''s liquidity management policy involves projecting cash flows in major currencies and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.

Market Risk Management

Foreign Currency Risk: The Company operates in Indian market only. The Company has not made any foreign transaction during the year.

Cash flow and fair value interest rate risk

The Company''s main interest rate risk arises from long-term borrowings with variable rates, which expose the Company to cash flow interest rate risk. The Company''s fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market interest rates.

Capital Management

The Company''s objectives when managing capital are to safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and Maintain an optimal capital structure to reduce the cost of capital.

Consistent with others in the industry, the Company monitors capital on the basis of the following gearing ratio:

Contingent Liabilities not provided for are '' 2700.00 Lacs.(PY:''.1800.00 Lacs.),being bank gurantees issues by Bank Of India,Bhadra branch on behalf of the company.

^AAThe Gujarat VAT department has raised demands for Tax/ Interest / Penalty for Financial year 2017-18 amounting to '' 63 /-Lacs. The company has initiated proceedings against these disputed demands. The management is of the opinion that these demands are not genuine and will be deleted by appropriate Authority and hence no provision for the same is made in the books of account.

Defined Benefits Plan

The provision for gratuity as at March 31,2025, amounts to ''16.78 lakhs, as estimated by the management. This provision has not been determined based on an actuarial valuation in accordance with the requirements of Ind AS 19 - Employee Benefits, but is based on management''s internal estimates using a rational and consistent basis.

Note 33 : Segment information:

The Company is engaged primarily on the business of "Electrification Services" 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".

Note 34 : Events after the reporting period:

There have been no events after the reporting date that require disclosure in the financial statements.

Note 35 : In the opinion of the Board of Directors, the Current Assets, Loans and Advances have value on realisation in the ordinary course of business, at least equal to the amount at which they are stated in the foregoing Balance Sheet and adequate provision for all known liabilities on the Company has been made.

Note 36 : Impairment of Assets:

On periodical basis and as and when required, the company reviews the carrying amount of its assets. Company has been making profits since past few accounting periods which covers depreciation as well as interest. Operating cash flows from the operating activities before and after working capital changes are positive.

In the Financial year 2024-25, the company has reviewed the carrying amount of its assets and found that there is no indication that those assets have suffered any impairment loss. Hence no such impairment loss has been provided.

Note 37 : No proceedings have been initiated or pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder, as at March 31,2025.

Note 38 : The Company 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 March 31,2025.

Note 39 : The Company 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 March 31,2025.

Note 41 : The Company has borrowings from banks and financial institutions on the basis of security of current assets and the quarterly returns filed by the Company with the banks and financial institutions are in accordance with the books of accounts of the Company for the respective quarters.

Note 42 : The Company has taken borrowings from banks and financial institutions and utilised them for the specific purpose for which they were taken as at the Balance sheet date.

Note 43 : 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 March 31,2024, 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 March 31,2025.

Note 44 : The Company has not traded or invested in Crypto currency or Virtual Currency during the year ended March 31,2025..

Note 45 : Derivatives: There are no derivative instruments in the Company for the year ended March 31,2025.

Note 46 : Registration of charges or satisfaction with Registrar of Companies (ROC): All charges or satisfaction are registered with ROC within the statutory period for the financial years ended March 31,2025. No charges or satisfactions are yet to be registered with ROC beyond the statutory period.

Note 47 : Compliance with number of Layers of companies: The Company has not violated 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.

Note 48 : Miscellaneous

Group structure: Not Applicable. The Company does not have any holding, subsidiary or associate company.

Net Profit or Loss for the period, prior period items and changes in accounting policies: The Company does not have any prior period items / change in accounting policies during the current year other than disclosed in financials.

Revenue Recognition: There have been no circumstances in which revenue recognition has been postponed pending the resolution of significant uncertainties.

Consolidated Financial Statements (CFS): The Company does not have any subsidiary, associate or joint venture accordingly CFS is not applicable.

The financial statements are presented in Indian Rupees (?) which is also its functional currency and all values are rounded to the nearest lakhs up to two decimal as per the requirements of Schedule III,unless otherwise stated and have been regrouped, rearranged and reclassified wherever necessary.

Note 49 : There were no instances of fraud reported during the year ended March 31,2025.

Note 50 : Figures of previous year have been reworked/regrouped/reclassified wherever necessary.

Recent pronouncements issued but not effective

Ministry of Corporate Affairs ("MCA") notifies new standards or amendments to the existing standards under Companies (Indian Accounting Standards) Rules from time to time.For the year ended March 31,2025, MCA has notified Ind AS - 117 Insurance Contracts and amendments to existing Ind AS 116 - Leases, relating to sale and leaseback transactions, w.e.f. April 1, 2024. The Company has determined, based on its evaluation, that it does not have any significant impact in its financial statements.

---

Mar 31, 2024

8.1 Terms/ rights attached to equity shares

The Company has only one class of equity shares having a par value of '' 10/- per share. All these shares have the same rights and preferences with respect to the payment of dividend, repayment of capital and voting. The Company declares and pays dividends in Indian rupees. The interim dividend is declared and approved by Board of Directors. The final dividend proposed by the Board of Directors and is subject to the approval of the shareholders in the ensuing Annual General Meeting. 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. The distribution will be in proportion to the number of equity shares held by the shareholders.

Company has taken secured loan facility from SIDBI "Small Industries Development Bank of India" . The same has been secured by subservient charge on all the movable and immovable assets of the borrower already charged to Bank of India. Such charges would be sub-survient to all the existing and prospective charges created/ to be created by the borrower on the said assets in favour of Bank of In-dia,which has extended/would extend busines loans(viz. term loans for machineries,business premises and working capital) to the borrower for the same business for which SIDBI has extended the sub-debt. All such aforesaid lenders would be referred to as " Senior Secured Lenders".Company has also given irrevocable and unconditional gurantee of Directors 1) Shri Gaurang P shah 2) Smt Rupal G Shah and all such persons hoding a stake of more than 10% in the company.Over and above this, company has also liened Fixed deposit amounting to Rs.2500000.

^AThe terms of repayment not yet finalised for Unsecured Loan from Body Corporate and Directors. Rate of Interest is charged @8.60 % p.a.

AAACash Credit facilities from Bank of India is secured by way of hypothecation of stock, book debts and other current assets ofthe company both present and future and is also secured by personal guarantee of directors.It is also collaterally secured by hypothecation of Plant & Machinery and Equitable mortgage of Following properties.(1) Office premises-61 6 th floor, Titanium, Nr. Prahaladnagar, Ah-medabad owned by the company (2) Corporate house no 6 , Sigma corporate 1, Sindhu Bhavan road, Bodakdev, Ahmedabad . Over and above this, personal property of Directors Shri Gaurang P. Shah & Smt Rupal G. Shah has been given as a Collateral security.

Interest rates on Cash Credit Accounts are varying , which are linked to base rate of Bank from time to time.

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.

Fair Value of Financial Assets & Liabilities measured at amortized cost

• The carrying amounts of trade receivables, trade payables, capital creditors and cash and cash equivalents are considered to be the same as their fair values, due to their short-term nature.

• The fair values of non-current borrowings are based on discounted cash flows using a current borrowing rate. They are classified as level 3 fair values in the fair value hierarchy due to the use of unobservable inputs, including own credit risk. They are subsequently measured at amortised cost at balance sheet date.

Credit Risk Management

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

The carrying amount of following financial assets represents the maximum credit exposure:

Other financial assets

The company maintains its Cash and cash equivalents and Bank deposits with banks having good reputation, good past track record and high quality credit rating and also reviews their credit-worthiness on an on-going basis.

Trade receivables

Trade receivables of the company are typically unsecured. The Company has major customers are government companies and government bodies. Hence, no credit risk is perceived by the Company.

The above receivables are past due but not impaired since the major customers are government companies and government bodies, being a government entity, does not carry any credit risk.

Liquidity Risk

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses, Company treasury maintains flexibility in funding by maintaining availability under committed credit lines.

Management monitors rolling forecasts of the Company''s liquidity position and cash and cash equivalents on the basis of expected cash flows. This is generally carried out at local level in the operating companies of the Company in accordance with practice and limits set by the Company. These limits vary by location to take into account the liquidity of the market in which the entity operates. In addition, the Company''s liquidity management policy involves projecting cash flows in major currencies and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.

Market Risk Management

Foreign Currency Risk: The Company operates in Indian market only. The Company has not made any foreign transaction during the year. Cash flow and fair value interest rate risk

The Company''s main interest rate risk arises from long-term borrowings with variable rates, which expose the Company to cash flow interest rate risk. The Company''s fixed rate borrowings are carried at amortised cost. They are therefore not subject to interest rate risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market interest rates.

Capital Management

The Company''s objectives when managing capital are to safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and Maintain an optimal capital structure to reduce the cost of capital.

Consistent with others in the industry, the Company monitors capital on the basis of the following gearing ratio:

Net debt (total borrowings net of cash and cash equivalents) divided by Total ''equity'' (as shown in the balance sheet, including non-controlling interests)

Defined Benefits Plan

Gratuity: The gratuity provision as on 31st Mar,2024 is according to the management is Rs. 10 lakhs , Hence, the provision for the same is made accordingly. Actual valuation is yet to be made.

Note 33 : Segment information:

The Company is engaged primarily on the business of "Electrification Services" 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".

Note 34 : Events after the reporting period:

There have been no events after the reporting date that require disclosure in the financial statements.

Note 35 : In the opinion of the Board of Directors, the Current Assets, Loans and Advances have value on realization in the ordinary course of business, at least equal to the amount at which they are stated in the foregoing Balance Sheet and adequate provision for all known liabilities on the Company has been made.

Note 36 : Impairment of Assets:

On periodical basis and as and when required, the company reviews the carrying amount of its assets. Company has been making profits since past few accounting periods which covers depreciation as well as interest. Operating cash flows from the operating activities before and after working capital changes are positive.

In the Financial year 2023-24, the company has reviewed the carrying amount of its assets and found that there is no indication that those assets have suffered any impairment loss. Hence no such impairment loss has been provided.

Note 37 : No proceedings have been initiated or pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder, as at 31 March 2024.

Note 37 : No proceedings have been initiated or pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder, as at 31 March 2024.

Note 38 : The Company is not a declared willful defaulter by any bank or financial Institution or other lender, in accordance with the guidelines on willful defaulters issued by the Reserve Bank of India, during the year ended 31 March 2024.

Reasons for variance*
Name of the Ratio	Explanation for any change in the ratio by more than 25% as compared to the preceding year
(a) Current Ratio (in times)	A higher current ratio is better for the business. A good current ratio is between 1.2 to 2, which means that the business has 2 times more current assets than liabilities to covers its debts.
(b) Debt-Equity Ratio (in times)	-
(c) Debt Service Coverage Ratio (in times)	A debt service coverage ratio of 1 or above indicates that a company is generating sufficient operating income to cover its annual debt and interest payments. As a general rule of thumb, an ideal ratio is 2 or higher. A ratio that high suggests that the company is capable of taking on more debt.
(d) Return on Equity Ratio (in %)	Due to Higher PAT with compare to previous year (i.e. PAT increase by 58.30%)So,ROE Increase with compare to previous year.
(e) Inventory turnover ratio (in times)	The higher the inventory turnover, the better, since high inventory turnover typically means a company is selling goods quickly, and there is considerable demand for their products. Low inventory turnover, on the other hand, would likely indicate weaker sales and declining demand for a company''s products.
(f) Trade Receivables turnover ratio (in times)	What Is a Good Accounts Receivable Turnover Ratio? Generally speaking, a higher number is better. It means that your customers are paying on time and your company is good at collecting.
(g) Trade payables turnover ratio (in times)	A higher value of accounts payable turnover ratio indicates that the business is making payments to its creditors on time and the business is in good standing with the creditors and suppliers.
(h) Net capital turnover ratio (in times)	A higher working capital turnover ratio is better, and indicates that a company is able to generate a larger amount of sales. However, if working capital turnover rises too high, it could suggest that a company needs to raise additional capital to support future growth.
(i) Net profit ratio (in %)	Due to Higher sales with compare to previous year.
(j) Return on Capital employed (in %)	-
(k) Return on Investment (in %)	-

Note 41 : The Company has borrowings from banks and financial institutions on the basis of security of current assets and the quarterly returns filed by the Company with the banks and financial institutions are in accordance with the books of accounts of the Company for the respective quarters.

Note 42 : The Company 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.

Note 43 : 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, 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.

Note 44 : The Company has not traded or invested in Crypto currency or Virtual Currency during the year ended 31 March 2024.

Note 45 : Derivatives: There are no derivative instruments in the Company for the year ended 31 March 2024.

Note 46 : Registration of charges or satisfaction with Registrar of Companies (ROC): All charges or satisfaction are registered with ROC within the statutory period for the financial years ended March 31, 2024. No charges or satisfactions are yet to be registered with ROC beyond the statutory period.

Note 47 : Compliance with number of Layers of companies: The Company has not violated 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.

Note 48 : Miscellaneous

Group structure: Not Applicable. The Company does not have any holding, subsidiary or associate company.

Net Profit or Loss for the period, prior period items and changes in accounting policies: The Company does not have any prior period items / change in accounting policies during the current year other than disclosed in financials.

Revenue Recognition: There have been no circumstances in which revenue recognition has been postponed pending the resolution of significant uncertainties.

Consolidated Financial Statements (CFS): The Company does not have any subsidiary, associate or joint venture accordingly CFS is not applicable.

The financial statements are presented in Indian Rupees (INR) which is also its functional currency and all values are rounded to the nearest lakhs up to two decimal as per the requirements of Schedule III, unless otherwise stated and have been regrouped, rearranged and reclassi-

Note 49 : There were no instances of fraud reported during the year ended 31 March 2024.

Note 50 : Figures of previous year have been reworked/regrouped/reclassified wherever necessary.

Recent pronouncements issued but not effective

Ministry of Corporate Affairs ("MCA") notifies new standards or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. For the year ended March 31, 2024, MCA has not notified any new standards or amendments to the existing standards applicable to the Company.

---

Mar 31, 2023

1.11 Contingent Liabilities

A provision is recognized when the Company has a legal and constructive obligation as a result of a past event, for which it is probable that cash outflow will be required and a reliable estimate can be made of the amount of the obligation.

The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (when the effect of the time value of money is material).

A contingent liability is disclosed when the Company has a possible or present obligation where it is not probable that an outflow of resources will be required to settle it. Contingent Liabilities are not provided for till the same are crystalised. Contingent assets are neither recognized nor disclosed.

1.12 Cash Flow Statement

Cash flows are reported using the indirect method, whereby profit before tax and tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.

1.13 Cash and Cash Equivalents

The Company considers all highly liquid financial instruments, which are readily convertible into known amount of cash that are subject to an insignificant risk of change in value.

1.14 Earnings Per Share

Basic earnings per share are calculated by dividing the net profit or loss for the year attributable to equitymshareholders after deducting preference dividends and attributable taxes by the weighted average number of equity shares outstanding during the year.

For the purpose of calculating diluted earnings per share, the net profit or loss 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, if any.

1.15 Lease

Finance Lease - Agreements are classified as finance leases, if substantially all the risks and rewards incidental to ownership of the leased asset is transferred to the lessee.

Operating Lease - Agreements which are not classified as finance leases are considered as operating lease. Operating lease payments/income are recognized as an expense/income in the standalone statement of profit and loss on a straight-line basis over the lease term unless there is another systematic basis which is more representative of the time pattern of the lease.

At the inception of a contract, the Company assesses whether a contract is or contains, a lease. A contract is, or contains a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange of consideration. As discussed with management, one of the premises is rented out and the same is covered under rental income. It is not to be considered as lease.

1.16 Financial Instruments

Financial assets and financial liabilities are recognized when a Company entity becomes a party to the contractual provisions of the instruments. Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.

1.17 Financial assets

All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis. Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame established by regulation or convention in the marketplace.

Financial assets at amortized cost:

Financial assets are subsequently measured at amortized cost if these financial assets are held within a business model whose objective is to hold these assets in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Financial assets at Fair Value:

Financial assets are measured at fair value through other comprehensive income if these financial assets are held within a business model whose objective is to hold these assets in order to collect contractual cash flows or to sell these financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

The Company in respect of equity investments (other than in subsidiaries, associates and joint ventures) which are not held for trading has made an irrevocable election to presentation other comprehensive income subsequent changes in the fair value of such equity instruments. Such an election is made by the Company on an instrument by instrument basis at the time of initial recognition of such equity investments.

Financial asset not measured at amortized cost or at fair value through other comprehensive income is carried at fair value through the statement of profit and loss.

Impairment of financial assets

Loss allowance for expected credit losses is recognized for financial assets measured at amortized cost and fair value through other comprehensive income. The Company recognizes life time expected credit losses for all trade receivables that do not constitute a financing transaction.

For financial assets whose credit risk has not significantly increased since initial recognition, loss allowance equal to twelve months expected credit losses is recognized. Loss allowance equal to the lifetime expected credit loss is recognized if the credit risk on the financial instruments has significantly increased since initial recognition.

De-recognition of financial assets

The Company de-recognizes a financial asset only when the contractual rights to the cash flows from the asset expire, or it transfers the financial asset and substantially all risks and rewards of ownership of the asset to another entity.

If the Company neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Company recognizes its retained interest in the assets and an associated liability for amounts it may have to pay.

If the Company retains substantially all the risks and rewards of ownership of a transferred financial asset, the Company continues to recognize the financial asset and also recognizes a collateralized borrowing for the proceeds received.

1.18 Financial Liabilities and Equity Instruments Classification as debt or equity

Financial liabilities and equity instruments issued by the Company are classified according to the substance of the contractual arrangements entered into and the definitions of a financial liability and an equity instrument.

Equity instruments

An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. Equity instruments are recorded at the proceeds received, net of direct issue costs.

Financial Liabilities

Trade payables are amounts due to vendors for purchase of goods or services acquired in the ordinary course of business and are classified as current liabilities to the extent it is expected to be paid within the normal operating cycle of the business.

Trade and other payables are initially measured at fair value, net of transaction costs, and are subsequently measured at amortized cost, using the effective interest rate method where the time value of money is significant.

Interest bearing bank loans, overdrafts and issued debt are initially measured at fair value and are subsequently measured at amortized cost using the effective interest rate method. Any difference between the proceeds (net of transaction costs) and the settlement or redemption of borrowings is recognized over the term of the borrowings in the statement of profit and loss. De-recognition of financial liabilities

The Company de-recognizes financial liabilities when, and only when, the Company''s obligations are discharged, cancelled or they expire.

Reclassification of financial assets

The company determines classification of financial assets and liabilities on initial recognition. After initial recognition of finan-

cial assets and financial liabilities, a reclassification is made only if there is a change in the business model for managing those assets. Changes to the business model are expected to be infrequent. The company''s senior management determines change in the business model as a result of external or internal changes which are significant to the company''s operations.

Such changes are evident to external parties. A change in the business model occurs when the company either begins or ceases to perform an activity that is significant to its operations. If the group reclassifies financial assets, it applies the reclassification prospectively from the reclassification date which is the first day of the immediately next reporting period following the change in business model. The company does not restate any previously recognized gains, losses (including impairment gains or losses) or interest.

1.19 Financial Instruments, Risk Management, Objectives And Policies Financial Risk Management

The company''s Board of Directors has overall responsibility for the establishment and oversight of the company''s risk management framework. 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. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the company''s activities.

Credit Risk Management

Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. To manage this, the Company periodically assesses the financial reliability of customers, taking into account the financial condition, current economic trends and ageing of accounts receivable. Individual risk limits are set accordingly.

Liquidity Risk

Liquidity Risk is defined as the risk that the company will not be able to settle or meet its obligations on time or at reasonable price. The company''s treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the company''s net liquidity position through rolling forecast on the basis of expected cash flows.

Market risk

Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in the price of a financial instrument. The value of a financial instrument may change as a result of changes in the interest rates, foreign currency exchange rates, equity prices and other market changes that affect market risk sensitive instruments. Market risk is attributable to all market risk sensitive financial instruments including investments and deposits, foreign currency receivables, payables and loan borrowings. The Company manages market risk through a treasury department, which eval

uates and exercises independent control over the entire process of market risk management. The treasury department recommends risk management objectives and policies, which are approved by Senior Management and the Audit Committee. The activities of this department include management of cash resources, borrowing strategies, and ensuring compliance with market risk limits and policies.

Interest rate risk

Interest rate risk is the risk that fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. In order to optimize the company''s position with regards to the interest income and interest expenses and to manage the interest rate risk, treasury performs a comprehensive corporate interest rate risk management by balancing the proportion of fixed rate and floating rate financial instruments in its total portfolio.

Foreign currency risk

The company does not operate internationally and hence not exposed to currency risk on account of its receivables or payables in foreign currency.

1.20 General

i) Income and Expenditure are accounted on accrual basis for all known items.

ii) Miscellaneous Expenditure shown in the Balance Sheet, if any, will be written off over a period of 5 years from the year

in which it is incurred.

iii) The Company is in the process of obtaining Confirmation of Balances of Sundry Creditors, Debtors, Loans and Advances

which are awaited.

iv) Expenditure in Foreign currency is Nil (Previous year: Nil) and Income in Foreign Currency is Nil (Previous year: Nil)

v) According to the information available with the Company regarding the suppliers who constituted a Micro Small or Me

dium Enterprise [MSME], there are no amounts due to Small Scale Industrial Undertaking as on 31.3.2023 other then disclosed in balance sheet.

vi) Import of goods calculated on CIF basis is Nil.

vii) The Company operates in a Single Segment namely electrification services and hence segment reporting is not applicable.

viii) The Company does not have any employee whose particulars are required to be disclosed pursuant to Rule 5(2) and 5(3) of The Companies (Appointment and Remuneration of Managerial Personnel)

Rules, 2014.

ix) In terms of Ind AS 36 - Impairment of Assets issued by ICAI, the management has reviewed its fixed assets and arrived at the conclusion that impairment loss which is difference between the carrying amount and recoverable value of assets, was not material and hence no provision is required to be made.

x) The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956.

xi) The company do not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property.

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

xiii) The Company have not traded or invested in Crypto currency or virtual currency during the current financial year.

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

xv) The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.

xvi) The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year.

xvii) The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets or both during the current or previous year.

xviii) EVENTS OCCURRED AFTER THE BALANCE SHEET DATE:

The company evaluates events and transactions that occur subsequent to the balance sheet date but prior to the approval of the financial statements to determine the necessity for recognition and/or reporting of any of these events and transactions in the financial statements. As of 27^th May 2023, there were no subsequent events to be recognized or reported that are not already previously disclosed.

xix) Previous year''s figures have been regrouped/re-arranged/recasted, wherever necessary, so as to make them comparable with current year''s figures.

TERMS/RIGHTS ATTACHED TO EQUITY SHARE

The company has only one class of Equity Shares having a par value of Rs. 10/- per share.

Each equity Share Holder is entitled to one vote par Share.

DIVIDEND

The board of directors has not proposed any dividend for the current financial year 2022-23 in the board meefing

The company has issued fully paidup bonus shares in the proporfion of 4 (Four) Equity Share for every 1 (one) existing equity shares held by the Members on 9th October, 2021.

In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferenfial amounts. The distribution will be in proporfion to the number of equity shares held by the shareholders. The holders of Partly Paid Equity Shares will have to contribute unpaid amount on the the Equity Shares held by them.As per records of the company including its register of members and other declarations received from them regarding beneficial interest, the above shareholding represents both legal and beneficial ownership of shares

No Shares has been Reserved for Issue underthe Employee Stock Option (ESOP).

No Share options are outstanding at the end of the year.

Contingent Liabilities not provided for are Rs.1721 Lacs.(PY:Rs.810 Lacs.),being bank gurantees issues by Bank Of India,Bhadra branch on behalf of the company.

(a) Estimated amounts of contracts remaining to be executed which are under process- Rs.17005.89

(b) Esti''mated amounts of contracts remaining to be executed which are yet to begin

The Gujarat VAT department has raised demands for Tax/ Interest / Penalty for Financial year 2017-18 amounting to Rs. 63 /-Lacs. The company has initiated proceedings against these disputed demands. The management is of the opinion that these demands are not genuine and will be deleted by appropriate Authority and hence no provision for the same is made in the books of account.

There are certain disputes regarding payments with IVRCL as the companies went into liquidation under order of NCLT. Company has raised it claim to liquidator and same has been accepted by the liquidator this has resulted in overdue payment of Rs.238.14 Lacs. The company however treat these as good, Though overdue for more than 3

There are certain disputes regarding payments with ABG Cements Ltd And this has resulted in overdue payment of Rs.74.87 Lacs. The company however treat these as good, though overdue for more than 3 years.

NOTE - 25

INITIAL PUBLIC OFFER

During the financial year 2015-16, the company has made an Initial public Offer (IPO) for 538800 equity shares of Rs.10 each.The equity shares were issued at a price of Rs.100 per share (Including premium of Rs. 90 per share). During the financial year 2015-16 company has received RS.538.80 lacs from the proceeds received in the IPO.

NOTE - 26

Figures have been rounded off to nearest Rupee upto two decimals as per the requirements of Schedule II I,unless

Additional Information required to be given pursuant to the Schedule III of The Companies Act, 2013 are either Nil or not applicable and hence not disclosed for better presentation of accounts.

NOTE - 27

Authorization of Financial Statements

The financial statements for the year ended 31 st March,2023 were approved by the board of directors on 27th

FOR, PARTH P. SHAH & CO Chartered Accountants,

For & On Behalf of Board of HEC INFRA PROJECTS LIMITED

FRN:141540W

( PARTH P. SHAH ) (GAURANG SHAH) (RUPAL SHAH)

PROPRIETOR MANAGING DIRECTOR DIRECTOR

Mem. No. 167721 DIN:01756079 DIN:01756092

Place : Ahmedabad (PANNALAL SURTI) (KHUSHI BHATT)

Date : 27/05/2023 CFO COMPANY SECRETARY

MEM NO:A51011

---

Mar 31, 2018

NOTE 1 :

Corporate Information :

HEC Infra Projects Limited is a public company incorporated in India. Its shares are listed on the emerge platiorm of the National Stock Exchange of India. The Company is mainly engaged in the electrification services.

The significant accounting policies followed by the company are as stated below :

2.1 TERMS/RIGHTS ATTACHED TO EQUITY SHARE

The company has only one class of Equity Shares having a par value of Rs. 10/- per share. Each equity Share Holder is entitled to one vote par Share.

2.2 DIVIDEND

The Dividend proposed by the Board of Directors is Rs. 1 per share which is subject to approval of the Share holders in the ensuing Annual General Meeting. The Company declares and pays dividends in Indian Rupees.

2.3 During the financial year 2013-14 company has issued 697666 bonus shares in the ratio of 1:1 utilising share premium account

2.4 During the financial year 2014-15 company has redeemed 93500 preference shares by way of conversion into equity shares.

2.5 In the event of liquidation of the company, the holders of 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. The holders of Partly Paid Equity Shares will have to contribute unpaid amount on the the Equity Shares held by them. As per records of the company including its register of members and other declarations received from them regarding beneficial interest, the above shareholding represents both legal and beneficial ownership of shares

2.6 No Shares has been Reserved for Issue under the Employee Stock Option (ESOP).

2.7 No Share options are outstanding at the end of the year.

2.8 Pursuant to the initial public offer some of the shares are locked in from the date of allotment of fresh shares in the IPO viz. from 23rd March 2016, as under :

(a) 414000 shares held by the the promoter, for a Period of three year.

Company has taken secured loan facility from SIDBI “Small Industries Development Bank of India” . The same has been secured by subservient charge on all the movable and immovable assets of the borrower already charged to Bank of India. Such charges would be subsurvient to all the existing and prospective charges created/ to be created by the borrower on the said assets in favour of Bank of India,which has extended/would extend busines loans(viz. term loans for machineries,business premises and working capital) to the borrower for the same business for which SIDBI has extended the sub-debt. All such aforesaid lenders would be referred to as “ Senior Secured Lenders”.Company has also given irrevocable and unconditional gurantee of directors 1) Shri Gaurang P shah 2) Rupal G Shah and all such persons hoding a stake of more than 10% in the company.Over and above this, company has also liened Fixed deposit amounting to Rs. 2500000.

3.1 Cash Credit facilities from Bank of India is secured by way of hypothecation of stock, book debts and other current assets of the company both present and future and is also secured by personal guarantee of directors. It is also collaterally secured by hypothecation of Plant & Machinery and Equitable mortgage of Following properties.(1) Office premises-61 6th floor, Titanium, Nr. Prahaladnagar, Ahmedabad owned by the company (2) Corporate house no 6 , Sigma corporate 1, Sindhu Bhavan road, Bodakdev, Ahmedabad . Over and above this, personal property of Directors Shri Gaurang P. Shah & Smt. Rupal G. Shah’s has been given as a Collateral security.

Interest rates on Cash Credit Accounts are varying , which are linked to base rate of Bank from time to time.

*This fixed deposit is liened in favour of Bank of India as cash margin for bank guarantee limits utilized from the Bank.

#This fixed deposit lis liened in favour of SIDBI as security towards loan of Rs. 4 crores (oustanding of Rs. 2.5 crores as on 31 March 2018) sanctioned.

NOTE - 4

CONTINGENT LIABILITY

(a) Estimated amounts of contracts remaining to be executed which are under process - Rs. 7956.70 Lakh

(b) Estimated amounts of contracts remaining to be executed which are yet to begin - Rs. 4500.00 Lakh

NOTE - 5

INITIAL PUBLIC OFFER

During the financial year 2015-16, the company has made an Initial public Offer(IPO) for 538800 equity shares of Rs. 10 each.The equity shares were issued at a price of Rs. 100 per share (Including premium of Rs. 90 per share). During the year company has received Rs. 538.80 lacs from the proceeds received in the IPO.

NOTE - 6

Previous year’s figures have been regrouped / recasted / reclassified wherever necessary to correspond with the current year’s classification / disclosure.

Additional Information required to be given pursuant to the Schedule III of The Companies Act, 2013 are either Nil or not applicable and hence not disclosed for better presentation of accounts.

---

Mar 31, 2016

1:In the above given share details 12400 shares have been clubbed with Mrs. Rupal Gaurang Shah which are jointly held by Mrs Rupal Gaurang Shah & Mr Gaurang Parmananddas Shah

TERMS/RIGHTS ATTACHED TO EQUITY SHARE

The company has only one class of Equity Shares having a par value of Rs. 10/- per share.

Each equity Share Holder is entitled to one vote par Share.

DIVIDEND

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

During the financial year 2013-14 company has issued 697666 bonus shares in the ratio of 1:1 utilizing share premium account.

During the financial year 2014-15 company has redeemed 93500 preference shares by way of conversion into equity shares.

In the event of liquidation of the company, the holders of 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. The holders of Partly Paid Equity Shares will have to contribute unpaid amount on the Equity Shares held by them. As per records of the company including its register of members and other declarations received from them regarding beneficial interest, the above shareholding represents both legal and beneficial ownership of shares.

No Shares has been Reserved for Issue under the Employee Stock Option (ESOP).

No Share options are outstanding at the end of the year.

Pursuant to the initial public offer some of the Company are locked in from the date of allotment of fresh shares in the IPO viz. from 23rd March 2015, as under:

414000 shares held by the promoter, For a Period of three year.

1074832 shares held by the promoter and promoter group, for a period of one year.

2: INITIAL PUBLIC OFFER

During the year, the company has made an Initial public Offer(IPO) for 538800 equity shares of Rs. 10 each. The equity shares were issued at a price of Rs. 100 per share (Including premium of Rs. 90 per share). During the year company has received RS.538.80 lacs from the proceeds received in the IPO. It has utilized sum of Rs. 3760500 towards the public issue expenses and the balance amount is kept with Bank Of India.

3. Previous year''s figures have been regrouped / recasted / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

Additional Information required to be given pursuant to the Schedule III of The Companies Act, 2013 are either Nil or not applicable and hence not disclosed for better presentation of accounts.

4: COMMITMENTS

5. Estimated amounts of contracts remaining to be executed which are under process- Rs. 7810.45 Lakh

6. Estimated amounts of contracts remaining to be executed which are yet to begin -Rs. 5520.70 Lakh

---

Mar 31, 2015

1. Details of Security and disclosure for Loan (As referred to Note no. 4 & 5):

Bank of India cash credit Account, Bank of India Corporate loan, & Bank of India mortgage loan a/c are principal secured against all stocks, books debts, term deposits, & Collateral security of Directors Shri Gaurang P. Shah &SmtRupal G. Shah''s personal property (1) Residental Bunglow 59, Milan Park, Sandesh press road, Vastrapur, Ahmedabad owned by Shri Gaurang P. Shah (2) Residential flat no E-54 Royal Orchid, Prahaladnagar road, Ahmedabad owned by Smt Rupal G. Shah(3) Office premises-61 6^th floor, Titanium, Nr. Prahaladnagar, Ahmedabad owned by the company(4) Corporate house no 6, Sigma corporate 2. Sindhu Bhavan road, Bodakdev, Ahmedabad owned by the company(5) Lien of LIC policies of Shri Gaurang P. Shah (6) Plant & Machinery (other than vehicles & office building) owned by the Company.

3. The outstanding balances of certain Trade Receivables, Trade Payables, Deposits, Advances and Other Current Assets/Liabilities are subject to confirmation and reconciliation, if any. However, in the opinion of the management, adjustment, if any, will not material.

4. The Company does not have any employee whose particulars are required to be disclosed pursuant to Rule 5(2) and 5(3) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

5. At the time of issue of the Preference Shares the ratio of conversion was not specified. However during the year the Preference Shares were converted in ratio of 1: 1. For the previous year also we have presumed die Preference Shares will be converted in the ratio of 1:1.

6. Expenditure in Foreign currency is Nil and Income in Foreign Currency is Rs. Nil

7. According to the information available with the Company regarding the suppliers who constituted a Micro Small or Medium Enterprise [ MSME] , there are no amounts due to Small Scale Industrial Undertaking as on 31.3.2015

8. Contingent Liability in respect of Bills discounted : Rs 241.95 Lacs ( previous year Rs. 117.07 Lacs)

9. Import calculated on CIF basis is NIL.

10. The Company operates in a Single Segment namely electrification services and within India and hence segment reporting is not applicable.

11. The Key Managerial Personnel Remuneration is within the permissible limits of The Companies Act, 2013 and the rules made there under.

12. Previous year''s figures have been regrouped / reacted / reclassified wherever necessary to correspond with the current year''s classification / disclosure. •

13. Additional Information required to be given pursuant to the Schedule III of The Companies Act, 2013 are either Nil or not applicable and hence not disclosed for better presentation of accounts.