Notes to Accounts of Krebs Biochemicals & Industries Ltd.

Mar 31, 2025

2.17 Provisions and contingencies

A provision is recognised when the Company has a present
obligation as a result of past events and it is probable that an
outflow of resources will be required to settle the obligation in
respect of which a reliable estimate can be made. Provisions
(excluding retirement benefits) are not discounted to their
present value and are determined based on the best estimate
required to settle the obligation at the Balance Sheet date.
These are reviewed at each Balance Sheet date and adjusted
to reflect the current best estimates. Contingent liabilities are
disclosed in the Notes.

2.18 R & D Expenditure

Revenue expenditure on research and development is charged
to Statement of Profit and Loss in the year in which it is incurred.
Capital expenditure on research and development is considered
as an addition to property, plant & equipment/ intangible assets.

2.19 Dividends

Provision shall be made in the accounts for the dividends
payable by the company as and when recommended by the
Board of Directors, pending approval of the share holders at
the Annual General Meeting.

2.20.1 Contingent liabilities

The Company has received various orders and notices from
tax and other judicial authorities in respect of direct taxes,
indirect taxes and labour matters. The outcome of these matters
have a material effect on the financial position, results of
operations or cash flows. The filing of suit or formal assertion
of a claim against the Company or the disclosure of any such
suit or assertions, does not automatically indicate that a
provision for a loss may be appropriate. Management regularly
analyses current information about these matters and makes
provision for probable losses including the estimate of legal
expense to resolve the matters. In their assessment
management considers the degree of probability of an
unfavourable outcome and the ability to make a sufficiently
reliable estimate of the amount of loss.

2.20.2 Going Concern Assumption

During the year ended 31 st March, 2025 Company has incurred
loss before tax of Rs.2692.40 lakhs as against loss before tax
of Rs.1972.84 lakhs during previous year ended 31st March,

2024. Total Liabilities exceeded its total assets by Rs.14623.88
Lakhs as on 31st March, 2025 compared to Rs.11921.67 Lakhs
as on 31st March, 2024. This financial position indicate that
material uncertainty exists that may cast significant doubt on
the Company''s ability to continue as a going concern and
therefore the Company may be unable to realise its assets
and discharge its liabilities in the normal course of business.
The Company''s management has carried out an assessment
of financial performance and has obtained confirmation from
our promoter M/s Ipca Laboratories Ltd., providing comfort of
financial support, as and when required to meet the Company''s
liabilities. During the current financial year, the Company has
prepared strategic plan for next five years. Pursuant to the
plan, the Company continues to focus on various initiatives
including cost optimisation through operational efficiency,
rationalization of existing operations and increase in sales
volume. With continued efforts the Company expects to address
the material uncertainty in future. Accordingly the above
financial results have been prepared on a going concern basis
which contemplates realisation of assets and settlement of
liabilities in the normal course of business.

Contingent Liabilities :

The following contingent liabilities are not provided for.

(i) Income Tax: Various demands raised by the Income Tax
authorities for Tax liability of Rs.723.75 lakhs (Out of that
Amount of Rs. 197.28 Lakhs adjusted against IT Refunds
of later years) & Interest Rs.334.65 Lakhs (Out of that
Amount of Rs. 177.67 Lakhs adjusted against IT Refunds
of later years) for which the company filed an appeal with
Honourable High Court of Judicature at Hyderabad for the
State of Telangana and CIT (appeals). Previous Year Tax
liability of Rs.729.87 lakhs & Interest Rs.329.29 Lakhs

Customs Duty:

(ii) Advance licence : Various demands raised by Chennai
Customs authorities against Advance license (DEEC)
amounting to Rs.144.58 lakhs (Tax Amount of Rs.37.21
Lakhs & Interest of Rs.107.37 Lakhs), Out of that Amount
of Rs. 37.21 Lakhs deposited in favour of Commissioner of
customs (Seaport), Customs House, Chennai as " Paying
under Protest"

(iii) Employee Provident Fund: Damages u/s 14B
amounting to Rs. 129.93 lakhs (Rs. 76.07 lakhs for Vizag
Unit and Rs. 53.86 lakhs for Nellore Unit respectively) were
raised by PF authorities. Pending disposal of appeals, the
company has deposited an amount of Rs 17.50 Lacs based
on interim directions.

(iv) Employee State Insurance: Damages u/s 85B
amounting to Rs.18.30 lakhs, Interest u/s 39(5) amounting
to Rs.4.16 lakhs for Vizag unit were raised by ESIC
authorities for which the company filed an appeal with higher
authority.

NOTE- 31

The amount receivable from N V R Co-Operative Sugar
Factory towards the Development of Factory and Cane
Development Expenses etc., has been treated as Advance
recoverable since the company is claiming the same from
Government of Andhra Pradesh / N V R Co-Operative Sugar
Factory.

The company has not created any Deferred Tax Asset during
the financial year since the company has brought forward
un absorbed depreciation losses and is not expecting any
taxable profits in foreseeable future.

NOTE- 35

Calculation of earnings per share :

Disclosure as required by Accounting Standard - Ind AS
33 Earning Per Share of the Companies (Indian Accounting
Standards) Rules 2015.

The earning per share is calculated by dividing the profit
after tax by weighted average number of shares outstanding
for basic and diluted EPS.

NOTE- 36

Segment Information: The company is operating in only one
segment business of Pharma and there is no geographical
segment to be reported.

NOTE- 37

The balances of trade receivables, trade payables, long term
loans & advances, short term loans & advances, other
current assets & other current liabilities are subject to
confirmation from respective parties.

NOTE- 38

During the year, the company has made provision for gratuity
on actuarial valuation and the company did not make any
contribution to a scheme administered by the insurer to
discharge the gratuity liability to its employees.

Audit Trail Disclosure:

The Ministry of Corporate Affairs ( MCA) by the Companies
( Accounts) Amendment Rules 2021 and vide notification
dated 24 March 2021 has issued the " Companies ( Audit
and Auditors) Amendments Rules, 2021 " has prescribed a
new requirement for companies under the proviso to Rule
3(1) of the Companies (Accounts) rules, 2014 inserted
requiring companies, which uses accounting software for
maintaining its books of account, shall use only such
accounting software which has a feature of recording audit
trail of each and every transaction, creating an edit log of
each change made in the books of account along with the
date when such changes were made and ensuring that the
audit trail cannot be disabled.

As required under above rules, the company uses in-house
developed software for its financial accounting and MIS
which works along with Database- Oracle as accounting
software for maintaining its books of account which has a
feature of recording audit trail (edit log) facility and the same
has been operated throughout the year for all transaction
recorded and the audit trail feature has not been tampered
with.

However, the audit trail feature was not enabled at the
database level for Database- Oracle to log any direct data
changes, used for maintenance of all accounting records
by the company.

NOTE- 40

Figures have been rounded off to nearest thousand.
Previous year''s figures have been regrouped / reclassified
wherever necessary to correspond with the current year''s
classification / disclosure.

For and on behalf of the Board of Directors

For BHAVANI & CO dr r t RAVI

^Chartei-e^d ^ounterts Chairman - DIN: 00272977

Firm''s Reg No: 012139S

Jitendra Shah

CA S. Kavitha Padmini Managing Director - DIN : 09377846

Partner

M.NO.229966

RAKESH KALBATE
Company Secretary & Compliance Officer
M.No. A66666

Place : Mumbai RITESH JAIN

Date : 20.05.2025 C F O

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Mar 31, 2024

a) The sales tax collected on domestic sales of Company''s products is treated as interest free sales tax loan from the AP State Government in accordance with the State Government incentive scheme. The amount credited to the loan account is based on the amounts collected as sales tax.

b) IPCA Laboratories Ltd-ICD (Inter Company Deposit)bearing rate of Interest@8%

c) 1,30,00,000 9% Non convertible, Redeemable, Non-cumulative preference shares issued @ Rs.100/- each without premium to IPCA Laboratories limited. These preference shares does not have any voting rights. As per Ind AS 32, Non Convertible Redeemable Preference Shares to be classified as Debt under Term Loans.

Disclosure in accordance with Ind AS - 19 "Employee Benefits", of the Companies (Indian Accounting Standards) Rules, 2015.

The company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/ termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. The Gratuity plan is a non funded plan. The following table summarizes the components of net benefit expense recognised in the Statement of Profit and Loss and the amounts recognised in the Balance Sheet as per Actuarial Valuation.

Note on RBL Bank Ltd (FDOD) availed on 20th November 2023. Type, amount, nature of facility:- Overdraft against Fixed deposit (ODFD), amount of Rs.10 Crores, on revolving nature, to meet working capital requirement/for meeting cash flow mismatches Rate of interest:-8.20% p.a linked to 6M T.Bill with quarterly reset. Margin:- 110% of the value of the Fixed Deposit.

Security:- 1) Fixed deposit to the extent of 110% of the facility to be duly lien marked in favour of the Bank to be placed under lien by Ipca Laboratories Ltd till the tenure of the credit facilities.

2) Exclusive charge on Plant & Machinery of the borrower laying or stored in the borrower''s facilities, premises and godowns or any other place, both present and future.

Other terms:- As per revised sanction letter dt.20th November 2023.

Contingent Liabilities :

The following contingent liabilities are not provided for.

(i) Income Tax: Various demands raised by the Income Tax authorities for Tax liability of Rs.729.87 Lacs (Out of that Amount of Rs. 197.28 Lacs adjusted against IT Refunds of later years) & Interest Rs.329.29 Lacs (Previous Year Tax liability of Rs.299.39 Lacs) for which the company filed an appeal with Honourable High Court of Judicature at Hyderabad for the State of Telangana and CIT (appeals).

(ii) (a) Customs Duty: Advance licence : Various demands raised by Chennai Customs authorities against Advance license (DEEC) amounting to Rs.144.58 Lacs (Tax Amount of Rs.37.21 Lacs & Interest of Rs.107.37 Lacs), Out of that Amount of Rs. 37.21 Lacs deposited in favour of Commissioner of customs (Seaport), Customs House, Chennai as "Paying under Protest"

(ii) (b) EPCG Licence: against EPCG license amounting to Rs.4.25 Lacs (Tax Amount of Rs.1.06 Lacs & Interest of Rs. 3.19 Lacs) towards non submission of EODC for which the company filed an appeal with Commissioner of Customs (Chennai Sea Port) & Pre deposit made Rs.0.07 Lacs

(iii) Employee Provident Fund: Damages u/s 14B amounting to Rs. 129.93 Lacs (Rs. 76.07 Lacs for Vizag Unit and Rs. 53.86 Lacs for Nellore Unit respectively) were raised by PF authorities. Pending disposal of appeals, the company has deposited an amount of Rs 17.50 Lacs based on interim directions.

(iv) Employee State Insurance: Damages u/s 85B amounting to Rs.18.30 Lacs, Interest u/s 39(5) amounting to Rs.4.16 Lacs for Vizag unit were raised by ESIC authorities for which the company filed an appeal with higher authority.

NOTE- 31

The amount receivable from N V R Co-Operative Sugar Factory towards the Development of Factory and Cane Development Expenses etc., has been treated as Advance recoverable since the company is claiming the same from Government of Andhra Pradesh / N V R Co-Operative Sugar Factory.

NOTE- 34

The company has not created any Deferred Tax Asset during the financial year since the company has brought forward un absorbed depreciation losses and is not expecting any taxable profits in foreseeable future.

NOTE- 35

Calculation of earnings per share :

Disclosure as required by Accounting Standard - Ind AS 33 Earning Per Share of the Companies (Indian Accounting Standards) Rules 2015.

The earning per share is calculated by dividing the profit after tax by weighted average number of shares outstanding for basic and diluted EPS.

NOTE- 36

Segment Information: The company is operating in only one segment business of Pharma and there is no geographical segment to be reported.

NOTE- 37

The balances of trade receivables, trade payables, long term loans & advances, short term loans & advances, other current assets & other current liabilities are subject to confirmation from respective parties.

NOTE- 38

During the year, the company has made provision for gratuity on actuarial valuation and the company did not make any contribution to a scheme administered by the insurer to discharge the gratuity liability to its employees.

NOTE- 39

Figures have been rounded off to nearest thousand. Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

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Mar 31, 2023

2.17 Provisions and contingencies

A provision is recognised when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in the Notes.

2.18R & D Expenditure

Revenue expenditure on research and development is charged to Statement of Profit and Loss in the year in which it is incurred. Capital expenditure on research and development is considered as an addition to property, plant & equipment/ intangible assets.

2.19Dividends

Provision shall be made in the accounts for the dividends payable by the company as and when recommended by the Board of Directors, pending approval of the share holders at the Annual General Meeting.

2.20.1 Contingent liabilities

The Company has received various orders and notices from tax and other judicial authorities in respect of direct taxes, indirect taxes and labour matters. The outcome of these matters have a material effect on the financial position, results of operations or cash flows. The filing of suit or formal assertion of a claim against the Company or the disclosure of any such suit or assertions, does not automatically indicate that a provision for a loss may be appropriate. Management regularly analyses current information about these matters and makes provision for probable losses including the estimate of legal expense to resolve the matters. In their assessment management considers the degree of probability of an unfavourable outcome and the ability to make a sufficiently reliable estimate of the amount of loss.

2.20.2 Going Concern Assumption

During the year ended 31 st March,2023 Company has incurred loss before tax of Rs. 2469.19 lakhs as against loss before tax of Rs. 4452.68 Lakhs during previous year ended 31 st March,

2022. Total Liabilities exceeded its total assets by Rs. 9946.23 Lakhs as on 31st March,2023 compared to Rs. 7509.32 Lakhs as on 31st March,2022. This financial position indicate that material uncertainty exists that may cast significant doubt on the Company''s ability to continue as a going concern and therefore the Company may be unable to realise its assets and discharge its liabilities in the normal course of business. The Company''s management has carried out an assessment of financial performance and has obtained confirmation from our promoter M/s Ipca Laboratories Ltd., providing comfort of financial support, as and when required to meet the Company''s liabilities. During the current financial year, the Company has prepared strategic plan for next five years. Pursuant to the plan, the Company continues to focus on various initiatives including cost optimisation through operational efficiency, rationalization of existing operations and increase in sales volume. With continued efforts the Company expects to address the material uncertainty in future. Accordingly the above financial results have been prepared on a going concern basis which contemplates realisation of assets and settlement of liabilities in the normal course of business.

Contingent Liabilities :

The following contingent liabilities are not provided for.

(i) Income Tax: Various demands raised by the Income Tax authorities amounting to Rs.299.39 lakhs (Previous Year Rs.299.39 lakhs) for which the company filed an appeal with Honourable High Court of Judicature at Hyderabad for the State of Telangana and CIT (appeals).

(ii) Customs Duty: Various demands raised by Chennai Customs authorities against Advance license (DEEC) amounting to Rs.107.38 lakhs (net), also against EPCG license amounting to Rs.4.19 lakhs (net) towards non submission of EODC for which the company filed an appeal with Commissioner of Customs (Chennai Sea Port).

(iii) Employee Provident Fund: Damages u/s 14B amounting to Rs. 129.93 lakhs (Rs. 76.07 lakhs for Vizag Unit and Rs. 53.86 lakhs for Nellore Unit respectively) were raised by PF authorities. Pending disposal of appeals, the company has deposited an amount of Rs 17.50 Lacs based on interim directions.

(iv) Employee State Insurance: Damages u/s 85B amounting to Rs.18.30 lakhs, Interest u/s 39(5) amounting to Rs.4.16 lakhs for Vizag unit were raised by ESIC authorities for which the company filed an appeal with higher authority.

NOTE- 31

The amount receivable from N V R Co-Operative Sugar Factory towards the Development of Factory and Cane Development Expenses etc., has been treated as Advance recoverable since the company is claiming the same from Government of Andhra Pradesh / N V R Co-Operative Sugar Factory.

The company has not created any Deferred Tax Asset during the financial year since the company has brought forward un absorbed depreciation losses and is not expecting any taxable profits in foreseeable future.

NOTE- 35

Calculation of earnings per share :

Disclosure as required by Accounting Standard - Ind AS 33 Earning Per Share of the Companies (Indian Accounting Standards) Rules 2015.

The earning per share is calculated by dividing the profit after tax by weighted average number of shares outstanding for basic and diluted EPS.

Segment Information: The company is operating in only one segment business of Pharma and there is no geographical segment to be reported.

NOTE- 37

The balances of trade receivables, trade payables, long term loans & advances, short term loans & advances, other current assets & other current liabilities are subject to confirmation from respective parties.

NOTE- 38

During the year, the company has made provision for gratuity on actuarial valuation and the company did not make any contribution to a scheme administered by the insurer to discharge the gratuity liability to its employees.

NOTE- 39

Figures have been rounded off to nearest thousand. Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

for and on behalf of the Board of Directors Sd/-

For BHAVANI & CO dr. r.t. Ravi

Chartei-e^{d Acc}ountants Chairman - DIN: 00272977

Firm''s Reg No: 012139S Sd/-

Sd/- Pabitrakumar Kalipada

CA S. Kavitha Padmini Bh_att_ach_aryy_a

Managing Director - DIN :07131152

M.NO.229966

Sd/-

Rohit Taparia Company Secretary

(ACS 35756)

Place : Hyderabad _;

Date : 24.05.2023 _ . . .

Ritesh Jain

C F O

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Mar 31, 2018

1 Corporate information

Krebs Biochemicals & Industries Ltd has been incorporated on 2nd December 1991. At present the company is engaged in the business of manufacture of active pharmaceutical ingredients. The company has two manufacturing facilities one at Regadichelaka, Nellore (Dist.) and another one at Kothapalli Village, Kasimkota Mandal, Vishakapatnam (Dist.), Andhra Pradesh, India.

a) The company has only one class of equity shares having a face value of Rs. 10/- per share. Each holder of equity share is entitled to one vote per share.

b) No new shares were issued during the year.

a) The company has entered into long term lease agreement with M/s IPCA Laboratories Ltd and received a interest free refundable lease deposit of Rs. 4500 lakhs for 5 years lease period. In conformity with transition to IND AS, the lease deposit is measured at its NPV considering the discounting rate at 13.50% and remaining amount on remeasurement is classified as rent received in advance.

b) Rent and Interest on the deposit above measured through fair valuation approach and is accounted through Other Comprehensive Income.

a) Advance from Customers includes Amount received from IPCA Laboratories Ltd of Rs. 155.27 Lakhs.

b) Payables for Other expenses includes Interest payable on ICD received from IPCA Laboratories Ltd of Rs. 735.31 Lakhs.

NOTE- 2

Contingent Liabilities :

The following contingent liabilities are not provided for.

(i) Excise Duty: There are various demands raised by the Excise authorities amounting to Rs.112.74 lakhs (Previous Year Rs.146.99 lakhs) for which the company preferred appeals with higher authorities. Pending disposal of appeals, the company has deposited an amount of Rs 20.00 Lakhs (Previous Year Rs 20.00 Lakhs) based on interim directions.

(ii) Income Tax: There are various demands raised by the Income Tax authorities amounting to Rs. 358.44 lakhs (Previous Year Rs.358.44 lakhs) for which the company preferred appeals with Honourable High Court of Judicature at Hyderabad for the States of Telangana and Andhra Pradesh

(iii) Employee Provident Fund: Damages u/s 14B amounting to Rs. 129.93 lakhs (Rs. 76.07 lakhs for Vizag Unit and Rs. 53.86 lakhs for Nellore Unit respectively) were raised by PF authorities. Pending disposal of appeals, the company has deposited an amount of Rs 17.50 Lakhs based on interim directions.

(iv) Arbitration with Mylan Laboratories Ltd : Mylan Laboratories Limited has raised a claim of Rs. 2.47 crores and conversely the Company has raised a claim of Rs. 1.30 crores along with future demurrage charges of Rs. 4.72 Lakhs per month.

NOTE- 3

The amount receivable from N V R Co-Operative Sugar Factory towards the Development of Factory and Cane Development Expenses etc., has been treated as Advance recoverable since the company is claiming the same from Government of Andhra Pradesh / N V R Co-Operative Sugar Factory.

NOTE- 4

Related party disclosures :

a) Name of the related parties:

Promoters / Promoters Group : Dr.R.T.Ravi - Chairman.

Mr. Avinash Ravi - Managing Director Mrs. Hemalata Ravi w/o Dr.R.T.Ravi M/s Ipca Laboratories Ltd Directors : Dr.R.T.Ravi - Chairman.

Mr. Avinash Ravi - Managing Director Mr. E.J.Babu - Director Mr. Manish Jain - Director Key Management Personnel : Mr. C.V.R.S.N.Kumar - CFO

Ms.Haritha Varanasi - Company Secretary

b) Aggregated Related party disclosures for the financial year 2017-18

i) Particulars of transactions during the year

NOTE- 5

The company has not created any Deferred Tax Asset during the financial year since the company has brought forward un absorbed depreciation losses and is not expecting any taxable profits in foreseeable future.

NOTE- 6

Calculation of earnings per share :

Disclosure as required by Accounting Standard - Ind AS 33 Earning Per Share of the Companies (Indian Accounting Standards) Rules 2015.

The earning per share is calculated by dividing the profit after tax by weighted average number of shares outstanding for basic and diluted EPS.

NOTE- 7

Segment Information: The company is operating in only one segment business of Pharma and there is no geographical segment to be reported.

NOTE- 8

The balances of trade receivables, trade payables, long term loans & advances, short term loans & advances, other current assets & other current liabilities are subject to confirmation from respective parties.

NOTE- 9

During the year, the company has made provision for gratuity on actuarial valuation and the company did not make any contribution to a scheme administered by the insurer to discharge the gratuity liability to its employees.

NOTE- 10

Figures have been rounded off to nearest rupee. Previous year’s figures have been regrouped / reclassified wherever necessary to correspond with the current year’s classification / disclosure.

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Mar 31, 2016

NOTE- 1

In the opinion of the management, the Current Assets, Loans and Advances are expected to realize at least the amount at which they are stated, if realized in the ordinary course of business and provision for all known liabilities have been adequately made in the accounts.

NOTE- 2

Disclosure of Sundry Creditors under Trade Payables is based on the information available with the Company regarding the status of the suppliers as defined under the "Micro, Small and Medium Enterprises Development Act, 2006" and relied upon by the Auditors. As per the records with the company, none of the enterprises have been identified as Micro, Small and Medium Enterprises.

NOTE- 3

Interest Free Sales Tax :

(i) During the year the company has paid interest free sales tax Loan of Rs. Rs.34.86 lakhs for its pharma division unit at Kothapalli. The interest free sales tax loan so far stood at Rs. 416.90 lakhs (previous Year Rs. 451.76 lakhs) and is payable as follows.

NOTE- 4

Contingent Liabilities :

The following contingent liabilities are not provided for.

(i) Excise Duty & Service Tax: There are various demands raised by the Excise authorities amounting to Rs.125.30 lakhs (Previous Year Rs.115.28 lakhs) for which the company preferred appeals with higher authorities. Pending disposal of appeals, the company has deposited an amount of Rs 20.00 lacs (Previous Year Rs 20.00 lacs) based on interim directions.

(ii) Income Tax: There are various demands raised by the Income Tax authorities amounting to Rs.315.53 lakhs for which the company preferred appeals with Honourable High Court of Judicature at Hyderabad for the States of Telangana and Andhra Pradesh

NOTE- 5

The Expenditure incurred on N V R Co-Operative Sugar Factory towards the Development of Factory and Cane Development Expenses etc, has been treated as Advance recoverable since the company is claiming the same from Government of Andhra Pradesh / N V R Co-Operative Sugar Factory.

NOTE- 6

Segment Information : The company is operating in only one segment business of pharma and there is no geographical segment to be reported

NOTE- 7

The balances of trade receivables, trade payables, long term loans & advances, short term loans & advances, other current assets & other current liabilities are subject to confirmation from respective parties.

NOTE- 8

During the year, the company has not made provision for gratuity on actuarial valuation and also the company did not make any contribution to a scheme administered by the insurer to discharge the gratuity liability to its employees.

NOTE- 9

Figures have been rounded off to nearest rupee. Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure. Also previous year figures are not comparable since they represent 6 months where as current period represent 12 months.

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Mar 31, 2015

1 Corporate information

Krebs Biochemicals & Industries Ltd has been incorporated on 2nd December 1991. At present the company is engaged in the business of manufacture of active pharmaceutical ingredients. The company has two manufacturing facilities one at Regadichelaka, Nellore (Dist) and another one at Kothapalli Village, Kasimkota Mandal, Vishakapatnam (Dist).

2 Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 2013. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous years.

NOTE- 3

In the opinion of the management, the Current Assets, Loans and Advances are expected to realise at least the amount at which they are stated, if realised in the ordinary course of business and provision for all known liabilities have been adequately made in the accounts.

NOTE- 4

Disclosure of Sundry Creditors under Trade Payables is based on the information available with the Company regarding the status of the suppliers as defined under the "Micro, Small and Medium Enterprises Development Act, 2006" and relied upon by the Auditors. As per the records with the company, none of the enterprises have been identified as Micro, Small and Medium Enterprises.

NOTE- 5

During the year, the company has made one time settlement with M/s Pinky Ventures Pvt Ltd and has paid an amount of Rs.34.80 crores as full and final settlement and got a principal waiver of Rs 31.92 crores. The principal waiver was credited to Statement of Profit and Loss.

NOTE- 6

Interest Free Sales Tax :

(i) During the year the company has availed interest free sales tax Loan of Rs. NIL for its pharma division unit at Kothapalli. The interest free sales tax loan availed by the unit so far stood at Rs. 451.76 lakhs (previous Year Rs. 451.76 lakhs).

(ii) During the year the company has paid interest free sales tax Loan of Rs. Nil for its pharma division unit at Regadichelika. The interest free sales tax loan outstanding is Rs. 59.80 lakhs (previous Year Rs. 59.80 lakhs).

NOTE- 7

Contingent Liabilities :

The following contingent liabilities are not provided for.

(i) Sales Tax: There are various demands raised by the sales tax authorities amounting to Rs.212.46 lakhs (Previous year Rs. 220.30 lakhs) for which the company preferred appeals with higher authorities. Pending disposal of appeals, the company has deposited an amount of Rs NIL (Previous Year Rs NIL).

(ii) Excise Duty: There are various demands raised by the Excise authorities amounting to Rs.115.28 lakhs (Previous Year Rs.3.34 lakhs) for which the company preferred appeals with higher authorities. Pending disposal of appeals, the company has deposited an amount of Rs 20.00 lacs (Previous Year Rs NIL) based on interim directions.

(iii) Income Tax: There are various demands raised by the Income Tax authorities amounting to Rs.315.53 lakhs for which the company preferred appeals with Honourable High Court of Judicature at Hyderabad for the States of Telangana and Andhra Pradesh.

NOTE- 8

The Expenditure incurred on N V R Co-Operative Sugar Factory towards the Development of Factory and Cane Development Expenses etc, has been treated as Advance recoverable since the company is claiming the same from Government of Andhra Pradesh.

NOTE- 9

The company has not created any Deferred Tax Asset during the financial year since the company has brought forward un absorbed depreciation losses and is not expecting any taxable profits in force able future.

NOTE- 10

Segment Information : The company is operating in only one segment business of pharma and there is no geographical segment to be reported

NOTE- 11

The balances of trade receivables, trade payables, long term loans & advances, short term loans & advances, other current assets & other current liabilities are subject to confirmation from respective parties

NOTE- 12

During the year, the company has not made provision for gratuity on actuarial valuation.

NOTE- 13

Figures have been rounded off to nearest rupee. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure. Also previous year figures are not comparable since they represent 15 months where as current period represent 6 months.

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Sep 30, 2014

1 Corporate information

Krebs Biochemicals & Industires Ltd has been incorporated on 2nd December 1991. At present the company is engaged in the business of manufacture of active pharmaceutical ingredients. The company has two manufacturing facilities one at Regadichelaka, Nellore (Dist) and another one at Kothapalli Village, Kasimkota Mandal, Vishakapatnam (Dist)

2 Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous years.

a) Terms/ rights attached to equity shares

The company has only one class of equity shares having a face value of Rs. 10 per share. Each holder of equity share is entitled to one vote per share. The dividends recommended by the Board of Directors, if any are subject to the approval of the shareholders in the ensuing Annual General Meeting.In the event of liquidation of the Company, the equity share holders are entitled to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to the number of shares held.

b) All the installments falling due within 12 months from the date of Balance Sheet have been classified as curent liabilities, the aggregate of which is shown as ''current maturities of long-term borrowings'' under Note - 11, ''Other Current Liabilities''.

c) The existing secured loans of Syndicate Bank, Andhra Bank, J & K Bank are assigned to M/s Pinky Ventures Pvt. Ltd ( Non Banking Finance Company ) during the current accounting period together with all the rights, titele and interest, pledges and guarantees in respect of such loans. Therefore the existing outstanding loans of these banks in the books have been transferred to M/s Pinky Ventures Pvt. Ltd and shown under the head Current maturities of Long term Borrowings. This loan is secured by first charge on all movable and immovable fixed assets both present and future of the Company and pari passu second charge on the stocks of Raw-materials, Work-in-Progress, Finished Goods, Stores and Spares and book debts both present and future of the company. The loans are further secured by irrevocable and unconditional personal guarantees of the Promoters.

d) The existing secured loan of Exim Bank is taken over by M/s Edelweiss Asset Reconstruction Co.(EARC) ( Non Banking Finance Company) during the current accounting period together with all the rights, titele and interest, pledges and guarantees in respect of such loans. The company has entered in to a restructuring agreement with EARC on the following terms: i) upfront payment of Rs.50 lacs was paid in July 14 ii) Rs.16.00 Crores is payable to EARC, Rs.1.00 Crore is paybale before Sep, 2015 and is clasified as current maturities of Long Term Borrowings. Out of the remaining balance of Rs.15.00 Crores, Rs. 1.00 Core is payable in 2 quarterly instalments of Rs.50.00 lacs each and the remianing Rs.14.00 crores is payable in quarterly instlments of Rs.1.00 crore each ending with 30.09.2019. iii) For the balance of Rs.1.76 Crores the promoter had transferred 1.50 lacs equity shares of the company.

e) The existing secured loan of IDBI Bank is taken over by M/s Edelweiss Asset Reconstruction Co.(EARC) ( Non Banking Finance Company) during the current accounting period together with all the rights, titele and interest, pledges and guarantees in respect of such loans. Therefore the existing outstanding loans of this bank in the books has been transferred to M/s Edelweiss Asset Reconstruction Co.(EARC) and shown under the head Current maturities of Long term Borrowings.. This loan is secured by first charge on all movable and immovable fixed assets both present and future of the Company and pari passu second charge on the stocks of Raw-materials, Work-in- Progress, Finished Goods, Stores and Spares and book debts both present and future of the company. The loan is further secured by irrevocable and unconditional personal guarantees of the Promoters.

Note : The existing secured loans of Andhra Bank, Jammu & Kashmir Bank are taken over by M/s Pinky Ventures Pvt. Ltd ( Non Banking Finance Company ) during the current accounting period together with all the rights, titele and interest, pledges and guarantees in respect of such loans. Therefore the existing outstanding loans of these banks in the books have been transferred to M/s Pinky Ventures Pvt. Ltd and shown under the head Current Laibilities.

Note: The interest accrued and due for borrowings include interest dues up to March, 2012 for term loans were transferred to the respective loan accounts during the current accounting year. Since the banks have with drawn from CDR package and sent notices under SARFASEI Act, the company has not provided interest on term loans and working capital loans from 1st April, 2012 to 30th June, 2013 amounting to Rs. 887.62 lacs and Rs.265.02 lacs respectively. The secured loans of Syndicate Bank, Andhra bank and J & K Bank are assigned to Pinky Ventures Pvt. Ltd and the secured loans of IDBI and Exim Bank are taken over by Edelweiss Asset Reconstruction co and the interest on these loans are not provided by the company from 1st July, 2013 to the date of assignment amounts to Rs.650.86 lacs.

Note : The recovery of above Long Term Trade Receivables of Rs.2,159.65 Lakhs is doubtful. However, the management is of the opinion that no provision is necessary during the year against the above amount as the company is pursuing the matter and the amount may be recovered.

NOTE- 3

In the opinion of the managemnt, the Current Assets, Loans and Advances are expected to realise at least the amount at which they are stated, if realised in the ordinary course of business and provision for all known liabilities have been adequately made in the accounts.

NOTE- 4

i) Disclosure of Sundry Creditors under Trade Payables is based on the information available with the Company regarding the status of the suppliers as defined under the "Micro, Small and Medium Enterprises Development Act, 2006" and relied upon by the Auditors.

ii) Details of total outstanding dues to Micro and Small Enterprises as per "Micro, Small and Medium Enterprises Development Act, 2006"

NOTE- 5

Fixed Deposit Receipts for Rs.31.60 lakhs (previous year Rs. 31.60 lakhs) are in lien with Bankers towards margin money for Letters of Credit & Bank Guarantees issued by them.

NOTE- 6

Interest Free Sales Tax :

(i) During the year the company has availed interest free sales tax Loan of Rs. NIL for its pharma division unit at Kothapalli. The interest free sales tax loan availed by the unit so far stood at Rs. 451.76 lakhs (previous Year Rs. 451.76 lakhs).

(ii) During the year the company has paid interest free sales tax Loan of Rs. Nil for its pharma division unit at Regadichelika. The interest free sales tax loan outstanding is Rs. 59.80 lakhs (previous Year Rs. 59.80 lakhs).

NOTE- 7

Contingent Liabilities :

The following contingent liabilities are not provided for.

(i) On account of Letters of Credit and Bank Guarantees (net of margin monies) amounting to Rs. Nil (Previous year Rs.Nil)

(ii) Sales Tax: There are various demands raised by the sales tax authorities amounting to Rs.220.30 lakhs (Previous year Rs. 7.84 lakhs) for which the company preferred appeals with higher authorities. Pending disposal of appeals, the company has deposited an amount of Rs NIL (Previous Year Rs NIL).

(iii) Excise Duty: There are various demands raised by the Excise authorities amounting to Rs.3.34 lakhs (Previous Year Rs.3.34 lakhs) for which the company preferred appeals with higher authorities. Pending disposal of appeals, the company has deposited an amount of Rs NIL (Previous Year Rs NIL) based on interim directions.

(iv) Income Tax: There are various demands raised by the Income Tax authorities amounting to Rs.315.53 lakhs for which the company preferred appeals with Hon''ble High Court of A.P.

NOTE- 8

The Expenditure incurred on N V R Co-Operative Sugar Factory towards the Development of Factory and Cane Development Expenses etc, has been treated as Advance recoverable since the company is claiming the same from Government of Andhra Pradesh.

NOTE- 9

As per Accounting Standard 22 "Accounting for Taxes on income" issued by the Institute of Chartered Accountants of India Rs.39.99 lakhs (Previous year Deferred Tax Asset of Rs 74.02 lakhs) of deferred tax liability arising during the financial year has been debited to the current year''s Profit and Loss account.

NOTE- 10

Segment Information : The company is operating in only one segment business of pharma and there is no geographical segment to be reported

NOTE- 11

Debtors, other advances and creditors are subject to confirmations.

NOTE- 12

During the year, the company has not made provision for gratuity on actuarial valuation.

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Mar 31, 2012

1 Corporate information

Krebs Biochemicals & Industires Ltd has been incorporated on 2nd December 1991. At present the company is engaged in the business of manufacture of active pharmaceutical ingredients. The company has two manufacturing facilities one at Regadichelaka, Nellore (Dist) and another one at Kothapalli Village, Kasimkota Mandal, Vishakapatnam (Dist).

2 Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous years.

a) Terms/ rights attached to equity shares

The company has only one class of equity shares having a face value of Rs. 10 per share. Each holder of equity share is entitled to one vote per share. The dividends recommended by the Board of Directors, if any are subject to the approval of the shareholders in the ensuing Annual General Meeting.In the event of liquidation of the Company, the equity share holders are entitled to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to the number of shares held.

a) All the installments falling due within 12 months from the date of Balance Sheet have been classified as curent liabilities, the aggregate of which is shown as 'current maturities of long-term borrowings' under Note - 11, 'Other Current Liabilities'.

b) Term Loans from IDBI, Exim Bank, Syndicate Bank and the WCT Loans from Andhra Bank, The Jammu & Kashmir Bank & United Bank of India are secured by first charge on all movable and immovable fixed assets both present and future of the Company (Subject to prior charges on specified movables created/ to be created in favour of Company's bankers by way of security for borrowings of working capital) and pari passu second charge on the stocks of Raw-materials, Work-in-Progress, Finished Goods, Stores and Spares and book debts both present and future of the company. The loans are further secured by irrevocable and unconditional personal guarantees of the Promoters namely, Dr.R.T.Ravi and Smt. Hemalata Ravi.

c) Interest & Repayament schedule of the Term Loans from IDBI, Exim Bank, Syndicate bank and the WCT Loans from Andhra Bank, The Jammu & Kashmir Bank and United Bank of India are detailed below as per CDR approved package:

Note : The working capital facilities from Andhra Bank, The Jammu & Kashmir Bank Ltd and United Bank of India are secured by first Charge on the stocks of Raw-materials, Work- in-Progress, Finished Goods, Stores and Spares and book debts of the Pharma Division and pari passu second charge on fixed assets of the Pharma Division. The loans are further secured by irrevocable and unconditional personal guarantees of the Promoters namely, Dr. R.T. Ravi and Smt. Hemalata Ravi.

NOTE- 3

In the opinion of the managemnt, the Current Assets, Loans and Advances are expected to realise at least the amount at which they are stated, if realised in the ordinary course of business and provision for all known liabilities have been adequately made in the accounts.

NOTE- 4

i) Disclosure of Sundry Creditors under Trade Payables is based on the information available with the Company regarding the status of the suppliers as defined under the "Micro, Small and Medium Enterprises Development Act, 2006" and relied upon by the Auditors.

NOTE- 5

Fixed Deposit Receipts for Rs.41.60 lakhs (previous year Rs. 28.26 lakhs) are in lien with Bankers towards margin money for Letters of Credit & Bank Guarantees issued by them.

NOTE- 6 Interest Free Sales Tax :

(i) During the year the company has availed interest free sales tax Loan of Rs. NIL (provisional) for its pharma division unit at Kothapalli. The interest free sales tax loan availed by the unit so far stood at Rs. 451.76 lakhs (previous Year Rs. 451.76 lakhs).

(ii) During the year the company has paid interest free sales tax Loan of Rs. 16.52 lakhs for its pharma division unit at Regadichelika. The interest free sales tax loan outstanding is Rs. 59.80 lakhs (previous Year Rs. 76.32 lakhs).

NOTE- 7

Contingent Liabilities :

The following contingent liabilities are not provided for.

(i) On account of Letters of Credit and Bank Guarantees (net of margin monies) amounting to Rs. 394.02 lacs (Previous year Rs. NIL/-)

(ii) Sales Tax: There are various demands raised by the sales tax authorities amounting to Rs.7.84 lakhs (Previous year Rs. 7.84 lakhs) for which the company preferred appeals with higher authorities. Pending disposal of appeals, the company has deposited an amount of Rs NIL (Previous Year Rs NIL).

(iii) Excise Duty: There are various demands raised by the Excise authorities amounting to Rs.3.34 lakhs (Previous Year Rs.3.34 lakhs) for which the company preferred appeals with higher authorities. Pending disposal of appeals, the company has deposited an amount of Rs NIL (Previous Year Rs NIL) based on interim directions.

(iv) Income Tax: There are various demands raised by the Income Tax authorities amounting to Rs.315.53 lakhs for which the company preferred appeals with Hon'ble High Court of A.P.

NOTE- 8

The Expenditure incurred on N V R Co-Operative Sugar Factory towards the Development of Factory and Cane Development Expenses etc, has been treated as Advance recoverable since the company is claiming the same from Government of Andhra Pradesh.

Due to inadequate profits during the Financial year, the company has paid only the minimum remuneration by way of Salary & Perquisites to Managing Director.

NOTE- 9

As per Accounting Standard 22 "Accounting for Taxes on income" issued by the Institute of Chartered Accountants of India Rs.190.16 lakhs (Previous year Rs 331.48 lakhs) of deferred tax asset arising during the financial year has been credited to the current year's Profit and Loss account.

NOTE- 10

Segment Information : The company is operating in only one segment business of pharma and there is no geographical segment to be reported.

NOTE- 11

Debtors, other advances and creditors are subject to confirmations.

NOTE- 12

During the year, the company has not made provision for gratuity on actuarial valuation.

NOTE- 13

The Revised Schedule VI has become effective from 1 April, 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.

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Mar 31, 2010

1. Fixed Deposit Receipts for Rs.26,65,000/- (previous year Rs. Rs.1,65,000/-) are in lien with Bankers towards margin money for Bank Guarantees issued by them.

2. Secured Loans

a) Term Loans:

Term Loans from IDBI, Exim Bank, Syndicate Bank and the WCT Loans from Andhra Bank, The Jammu & Kashmir Bank & United bank of India are secured by first charge on all movable and immovable fixed assets both present and future of the Company (Subject to prior charges on specified movables created/ to be created in favour of Companys bankers by way of security for borrowings of working capital) and pari passu second charge on the stocks of Raw-materials, Work-in-Progress, Finished Goods, Stores and Spares and book debts both present and future of the company. The loans are further secured by irrevocable and unconditional personal guarantees of the Promoters namely, Dr.R.T.Ravi and Smt. Hemalata Ravi.

b) Working Capital Loans :

The working capital facilities from Andhra Bank, The Jammu & Kashmir Bank Ltd and United Bank of India are secured by first Charge on the stocks of Raw-materials, Work-in-Progress, Finished Goods, Stores and Spares and book debts of the Pharma Division and pari passu second charge on fixed assets of the Pharma Division. The loans are further secured by irrevocable and unconditional personal guarantees of the Promoters namely, Dr. R.T. Ravi and Smt. Hemalata Ravi.

3. During the year the company has availed interest free sales tax Loan of Rs. 13,34,721/- (provisional) for its pharma division unit at Kothapalli. The interest free sales tax loan availed by the unit so far stood at Rs. 4,21,84,916/- (previous Year Rs. 3,96,06,972/-).

4. During the year the company has paid interest free sales tax Loan of Rs. 15,41,763/-for its pharma division unit at Regadichelika. The interest free sales tax loan outstanding is Rs. 95,33,160/-(previous Year Rs. 1,10,04,305/-).

5. Contingent Liabilities:

The Following contingent liabilities are not provided for:

i. On account of Letters of Credit and Bank Guarantees (net of margin monies) amounting to Rs. NIL (Previous year Rs. NIL/-)

ii. Sales Tax: There are various demands raised by the sales tax authorities amounting to Rs.7,84,4191- (Previous year Rs. t92,86,516/-) for which the company preferred appeals with higher authorities. Pending disposal of appeals, the company has deposited an amount of Rs NIL (Previous Year Rs 98,37,102/-).

iii. Excise Duty: There are various demands raised by the Excise authorities amounting to Rs.3,33,650/- (Previous Year Rs.3,33,650/-) for which the company preferred appeals with higher authorities. Pending disposal of appeals, the company has deposited an amount of Rs NIL (Previous Year Rs NIL) based on interim directions.

iv. Income Tax: There are various demands raised by the Income Tax authorities amounting to Rs.3,15,52,734/- for which the company preferred appeals with Honble High Court of A.P.

6. The Expenditure Incurred on N V R Co-Operative Sugar Factory towards the Development of Factory and Cane Development Expenses etc, has been treated as Advance recoverable since the company is claiming the same from Government of Andhra Pradesh.

7. The Company has not received information from vendor regarding the status under the Micro Act, and hence disclosures relating to amounts unpaid as at end of the year together with interest/payable under the Act have not given.

Due to inadequate of profits during the Financial year, the company has paid only the minimum remuneration by way of Salary & Perquisites to Managing Director. Remuneration to Director Sri Avinash Ravi is for Twelve Months.

8. The company is providing gratuity on accrual basis, based on actuarial valuation.

9. Related Party Disclosures:

a) Name of the related parties: .

Associate Companies Visakha Foods Pvt. Ltd Key Management Personnel: Dr.R.T.Ravi, Managing Director.

Mr. Avinash Ravi, Whole Time Director Relatives of Key Management Personnel: Mrs. Hemalata Ravi W/O Dr.R.T.Ravi

10. As per Accounting Standard 22 "Accounting for Taxes on income" issued by the Institute of Chartered Accountants of India Rs.9,01,24,865/-(Previous year Rs.93,36,153/-) of deferred tax asset arising during the financial year has been credited to the current years Profit and Loss account.

11. Sundry Debtors amounting to Rs.28.27 Crores includes Rs. 19.74 Crores, the recovery of which is doubtful. However, the management is of the opinion that no provision is necessary during the year against the above amount as the company is pursuing the matter and the amount may be recovered.

12. Segment Information:

The company is operating in only one segment business of pharma and there is no geographical segment to be reported

13. Additional information pursuant to the provisions of paragraph 3,4C and 4D of part II of Schedule VI of the Companies Act, 1956.

14. Debtors, Other Advances & Creditors are subject to confirmations.

15. Previous years figures are re-grouped wherever necessary to conform to the classification adopted for the current year and figures are rounded off to the nearest Rupee.

16. The Schedules referred to above form part of the Accounts.