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A Oneindia Venture

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Sensex 84,929.36 +0.53%

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Sensex 84,929.36 +0.53%

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Notes to Accounts of Mawana Sugars Ltd.

Mar 31, 2025

There are no restrictions over the title of the Companyâs intangible assets, nor are any intangible assets pledged as security for liabilities.

During the current year, the Company has acquired brand âMAWANAâ, which includes all associated trademarks, related marks, and copyrights for a total consideration of Rs. 5.75 crore. The acquisition was made from a related party, based on an independent fair valuation carried out by a qualified external valuer. The acquisition has been completed and the âAssignment Deedâ has been signed on December 31, 2024. The Company has paid stamp duty of Rs. 0.23 crore on the above said transaction.

The acquired brand is expected to contribute significantly to the Companyâs operations, given its strong market recognition and association with quality in the relevant product segments. The management has evaluated the economic benefits and strategic relevance of the brand and has assessed that it has an indefinite useful life, owing to the following factors:

- The brand is well-established and continues to enjoy a strong market presence.

- There is no foreseeable limit to the period over which the brand is expected to generate net cash inflows.

- The Company has the intention and ability to continue using the brand indefinitely.

In accordance with Ind AS 38 - Intangible Assets, the brand has not been amortized. Instead, it will be tested for impairment annually, or more frequently if events or changes in circumstances indicate that it might be impaired. The asset will continue to be reviewed regularly to confirm that the assessment of an indefinite useful life remains appropriate.

Impairment testing for intangible assets with indefinite useful lives has been carried out considering their recoverable amounts which, inter-alia, includes estimation of their value-in-use based on management projections.

Based on the above assessment, no impairment has been recognised during the year. Further, the Company has also performed sensitivity analysis around the base assumptions considered at the time of acquisition and has concluded that there are no reasonably possible changes to key assumptions that would cause the carrying amount of the aforesaid assets to exceed their recoverable values.

The transaction was conducted at armâs length and has been appropriately disclosed in the related party transactions note (Refer note 36).

5. Right-of-use assets

The Company has lease contracts for head office and corporate office used in its operations. Generally, the Company is restricted from assigning and subleasing the leased assets. The Company also has certain leases of assets with lease terms of 12 months or less. The Company applies the short-term leases recognition exemptions for these leases other than leases from related parties.

* During the previous year, the Company had granted a loan of Rs. 7.20 crore to Siel Industrial Estate Limited (Siel IE) (an erstwhile wholly owned subsidiary company) for a period of upto two years at the rate of interest of 9.50% per annum. Further, the Company also sanctioned an unsecured loan of Rs. 4.00 crore for a period of two years at the rate of interest of 9.50% per annum, out of which Rs. 0.50 crore was disbursed till previous year and Rs.0.80 crore was disbursed during the current year. Entire loan has been repaid by the subsidiary during the current year.

** During the financial year 2021-22, the Company had provided an unsecured loan of Rs. 1.00 crore to Siel IE repayable on call for a period of upto one year at the rate of interest of 9.50% per annum. The said loan was extended for further period of one year during the year 2022-2023 and was further extended for a period of one year during the previous year on the existing terms and conditions. Entire loan has been repaid by the subsidiary during the current year.

b) Terms, rights and restrctions attached to equity shares:

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each share holder of equity shares is entitled to one vote per share except 1,192 equity shares held by Siel Infrastructure & Estate Developers Private Limited, a subsidiary till October 11,2024, which pursuant to second proviso of Section 19(1) of the Companies Act, 2013, has no right to vote at meeting of the Company. Each holder of equity shares have a right to receive per share dividend declared by the Company. In event of liquidation of the Company, holder of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amount. The distribution will be in proportion to the number of equity shares held by the shareholders.

c) Detail of final dividend

During the current year, the shareholders at its annual general meeting held on July 06, 2024 approved a dividend of 40% (i.e. Rs. 4.00 per equity share of the face value of Rs. 10 each) to the equity shareholders aggregating to Rs. 15.65 crore for the financial year ended March 31,2024, which was deposited with the scheduled bank within the prescribed time.

d) Detail of interim dividend and final dividend proposed

The Board of Directors, in itâs meeting held on November 09, 2024, declared Interim Dividend of 30% (i.e. Rs. 3.00 per equity share of the face value of Rs. 10 each) for the financial year 2024-25. The same is proposed to be confirmed as final by the shareholders in the ensuing Annual General Meeting of the Company. Also the Board of Directors of the Company has recommended final dividend of 10% on equity shares (Rs. 1.00 per equity share of Rs.10 each), subject to approval of shareholders in ensuing Annual General Meeting, the liability of which would be recognised once this is approved by shareholders in the ensuing Annual General Meeting.

¹On October 11,2024, the Company completed the sale of its entire shareholding in its wholly owned subsidiary, Siel Infrastructure and Estate Developers Private Limited (âSiel IEDâ). Consequent to this divestment, the Company is in the process of seeking reclassification of 1,192 equity shares of the Company held by Siel IED from the Promoter Group to Public Shareholding, in accordance with Regulation 31A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, subject to the approval of the shareholders at the forthcoming Annual General Meeting. The said matter has been enquired by SEBI under Regulation 31 of SEBI (LODR) and has been appropriately responded to and clarified by the Company.

Nature and Purpose of reserve

a. Securities premium reserve

Securities premium reserve is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

b. Capital redemption reserve

Capital redemption reserve (CRR) is used to record the amount equal to the nominal value of equity shares buy back or redemption of preference shares. As per provisions of the Companies Act, 2013, CRR can be utilised only for paying up unissued shares of the Company to be issued to members of the Company as fully paid bonus shares.

c. Capital reserve Capital reserve includes :

a. Rs. 99.15 crore representing the extinguishment of the debts of erstwhile Mawana Sugars Limited (MSL), which got discharged pursuant to the surplus arising on sale of shares of Shivajimarg Properties Limited and,

b. Rs. 3.87 crore representing the extinguishment of preference share capital.

d. Retained earnings

Retained earnings are the profits that the Company has earned till date, less any transfers to general reserve, dividends or other distributions paid to shareholders. Retained earnings includes re-measurement loss / (gain) on defined benefit plans, net of taxes that will not be reclassified to profit and loss.

e. Storage fund for molasses account

As per Rule 3(1) of UP Sheera Niyantran Niyamawali, 1974, Molasses Storage Fund is created from the sale price of molasses and shall be utilized for the purpose of construction, erection and repair & maintenance of adequate storage facility of Molasses. Also it may be spent on abatement measures for control of pollution and or any other bonafide development activities which the Controller of molasses considers necessary.

The Company offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority.

The management at the end of each reporting period, assesses Companyâs ability to recognize deferred tax assets on unabsorbed depreciation carried forward, taking into account forecasts of future taxable profits and the law and jurisdiction of the taxable items and the assumptions on which these projections are based. Based on profits earned during the current year and previous years, future profitability projections, considering expected future market, economic conditions and tax laws, the managment is confident that there would be sufficient taxable profits in future which will enable the Company to utilize the above deferred tax assets on unabsorbed depreciation.

31 Earnings per share (EPS)

a) Basic and Diluted EPS amounts are calculated by dividing the profit for the year attributable to equity holders of the Company by the weighted average number of equity shares outstanding during the year.

32. A Leases

(a) Lease â as lessee

For maturity analysis of lease liability, refer note 39 Financial risk management framework and policies under maturities of financial liabilities.

The Company had total cash outflows for leases of Rs. 1.80 crore (March 31,2024 Rs 1.53 crore). There are no future cash outflows relating to leases that have not yet commenced.

Payments associated with short-term leases other than leases from related parties are recognised on a straight-line basis as an expense in statement of profit and loss. Short-term leases are leases with a lease term of 12 months or less.

(b) Lease â as lessor

The Company has given certain portion of its factory premises under operating leases. The gross carrying amount, accumulated depreciation and depreciation recognised in the statement of profit and loss in respect of such portion of the leased premises are not separately identifiable. There is no impairment loss in respect of such premises. No contingent rent has been recognised in the statement of profit and loss. Lease income is recognised in the statement of profit and loss under âOther incomeâ (refer note 23).

32. B Commitments and Contingencies (a) Commitments Rs. Crore
Particulars As at As at March 31, 2025 March 31,2024
a. Estimated amount of contracts remaining to be executed on capital 11.79 7.39 account and not provided for (net of capital advances): b. Uncalled liability on shares and other investments partly paid (# Rs. 20) # #
Total 11.79 7.39
(b) Contingent Liabilities in respect of Income Taxes/Central Excise/Service Tax/Value Added Tax and other taxes (i) In respect of indirect taxes/statutory dues Rs. Crore
	Nature of Dispute	Description	Period	As at March 31, 2025	As at March 31, 2024
	Central Excise, State Excise, Service Tax and Goods and Service Tax	Matter under litigation for Central Excise, Service Tax and Goods & Service Tax Department towards wrong availment of cenvat credit taken, dispute on levy of service tax and excise duty and penalty/Interest imposed	1994-95 to 1996-97, 1998-99, 1999-2000 to 2002-03, 2006-07, 2004-05 to 2016-17 and 2019-20	2.25	2.52
	Provident Fund	Demand Notice received from Employeesâ Provident Fund Organisation towards levy of damages under Section 14-B and Interest under Section 7-Q of The Employeesâ Provident Fund and Miscellaneous Provisions Act, 1952	1996-2020	1.62
	House Tax and Water Tax	House Tax and Water Tax dispute with Nagarpalika Parishad, Mawana, pending reassessment	2007-08 to 2024-25	2.47	2.32
	Total (i)			6.34	4.84

(ii)	Other Matters under disputes are as below: Rs. Crore
	Nature of Dispute	Description	Period	As at March 31, 2025	As at March 31, 2024
	Land	Land related disputes	1985-86, 1975-76, 2007-08 to 2023-24	0.10	0.10
	Land	Land related disputes	Total	0.10	0.10
	Labour	Labour related disputes	2006-07, 2008-09 and 2010-11	0.17	0.40
			1997-98, 1999-2000 to 2002-03, 2008-09, 2010-11 and 2012-13	0.92	0.92
			1999-2000, 2005-06, 1996-97, 1993-94, 1992-93, 1985-86,1995-96, 1992-93, 2014-15, 2018-19, 2021-22, 2022-23, 2023-24 and 2024-25	1.56	1.37
			Total	2.65	2.69
	Civil	Others	2010-11, 2022-23 and 2024-25	0.47	0.31
			Total	0.47	0.31
	Interest on Cane Price / Commission Arrears	Interest on delay payment of cane dues (Refer note 48)	2002-03, 2006-07, 2012-13 to 2024-25	479.86	477.79
			Total	479.86	477.79
			Total (ii)	483.08	480.89
	Grand Total ((i) (ii))			489.42	485.73

(iii) During an earlier years, the Company had provided bank guarantees (BG) amounting to Rs. 7.20 crore to Tecumseh Products India Limited (TPIL), to whom it had sold the compressor business in an earlier year. These guarantees were issued to cover any loss, damage, claim, action, suit, etc., arising from various representations or breaches thereof, including contingent liabilities existing on or prior to March 31, 1997, which TPIL might eventually be liable to pay. These liabilities related to pending demands in respect of sales tax, central excise, and civil matters.

During the financial year 2023-24, cases related to central excise were decided in favour of TPIL by the Honâble High Court of Andhra Pradesh, vide its order dated March 19, 2024. The courtâs decision was based on a circular issued by the Central Board of Indirect Taxes and Customs (CBIC), which stated that no appeal shall be filed by the department in cases where the amount involved is less than Rs. 1.00 crore.

Consequently, during the current year, the Company received back the duly discharged bank guarantees along with fixed deposits amounting to Rs. 6.92 crores from TPIL. The Company has now provided a fresh bank guarantee amounting to Rs. 0.28 crore to TPIL, covering the remaining contingent liabilities of Rs. 0.16 crore in respect of sales tax and Rs. 0.12 crore for a pending civil case.

(iv) During an earlier year, the Company had given a counter indemnity/guarantee in favor of existing directors of Transiel India Limited (âthe Subsidiaryâ) to protect their interest against any loss/ future liabilities that may arise after the name of the said subsidiary that has been struck off under the Easy Exit Scheme, 2011.

(v) There are numerous interpretative issues relating to the Supreme Court (SC) judgement on PF, dated February 28, 2019. The Company will make necessary provision on receiving further clarity on the subject.

(vi) During an earlier year, Income Tax department had passed an assessment order for the assessment year 201718 under Section 143(3) of the Income Tax Act, 1961, wherein the assessing officer had disallowed / added back certain items resulting into adjustment of brought forward losses/unabsorbed depreciation by Rs. 336.40 crore under normal provisions of the Income Tax Act. Under Section 115JB (MAT), the assessing officer raised demand of Rs. 13.90 crore (including interest of Rs. 4.53 crore) and further interest demand on the above demand of Rs. 5.25 crore was raised. Against the total tax demand of Rs. 19.15 Crore the Company is carrying provision of Rs. 14.67 crore (March 31, 2024 Rs. 14.54 crore) ((including interest of Rs. 5.45 crore (March 31, 2024 Rs. 5.37 crore)).

However, based on the legal opinion taken by the Company, additions/demands are not sustainable under the provisions of the Income Tax Act. An appeal had been filed by the Company in an earlier year against the above said order with CIT(Appeals) which is under hearing and an application under Section 154 of the Income Tax Act for the rectification of the said additions/demands has also been filed in an earlier year with the Assessing Officer. The Company has already deposited (including adjustment of income tax refund of the subsequent years) a sum of Rs 9.26 crore under protest against the above demand amount.

(vii) During an earlier year, Income Tax department had passed an assessment order for the assessment year 201819 under Section 143(3) of the Income Tax Act, 1961, wherein the assessing officer had disallowed / added back certain items resulting into adjustment of brought forward losses/unabsorbed depreciation by Rs. 20.30 crore under normal provisions of the Income Tax Act. An appeal had been filed by the Company in the earlier year against the above said order with CIT(Appeals) which is under hearing.

(viii) Other income tax demands for the asssessment year 2021-22 amounting to Rs. 0.06 crore (March 31,2024 Rs. 0.06 crore).

33 Research and development costs

Research and development expenses included under relevant heads in the Statement of Profit and Loss amounting to Rs. 1.38 crore (March 31, 2024 Rs. 1.51 crore).

b) Defined Benefits Plans

Gratuity (Funded) - In accordance with Ind AS 19, actuarial valuation was done and details of the same are given below:

The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the Act, employee who has completed five years of service is entitled to specific benefit. The level of benefits provided depends on the memberâs length of service and salary at retirement age. The gratuity fund is managed by the Life Insurance Corporation of India (LIC). The companyâs obligation in respect of gratuity plan is provided based on the actuarial valuation. The company recognises actuarial gains and losses immediately in other comprehensive income net of taxes.

c) Risk exposure Actuarial Risk

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

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

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

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

Investment Risk

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

Liquidity Risk

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

Market Risk

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

Legislative Risk

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

37 Segment InformationA. Operating Segment

As per Ind AS 108 identification of segment is based on the manner in which the entityâs Chief Operating Decision Makersâ (CODM) reviews the business components regularly to make decisions about allocating resources to segment and in assessing its performance.

The Operating segments of the Company are identified as Sugar, Power and Distillery as the Chief Operating Decision Maker reviews business performance of the Company on the basis of these segments.

B. Geographical Segment

The Company mainly caters to domestic markets. However, there is export/deemed export of Sugar which has been presented in geographical segment.

C. Segment accounting policies:

In addition to the significant accounting policies applicable to the business segments as set out in note 2 above, the accounting policies in relation to segment accounting are as under:

i) Segment revenue and expenses:

Segment revenue and expenses are directly attributable to the segments.

ii) Segment assets and liabilities:

Segment assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and property, plant and equipments, net of allowances and provisions which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities. While most of the assets/ liabilities can be directly attributed to individual segment, the carrying amount of certain assets/ liabilities pertaining to two or more segments are allocated to the segments on a reasonable basis.

iii) Inter segment revenues:

Inter segment revenues between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

The management assessed that cash and cash equivalents, other bank balances, fixed deposits, trade receivables, trade payables and other current financial liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

38 B. Fair Value Hierarchy

All financial instruments for which fair value is recognised or disclosed are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is insignificant to the fair value measurements as a whole.

Level 1 : Quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2 : Valuation techniques for which the lowest level inputs that has a significant effect on the fair value measurement are observable, either directly or indirectly.

The Companyâs principal financial liabilities comprise of borrowings, trade payables, other payables, security deposits received, capital creditors and employee related payables. The main purpose of these financial liabilities is to finance the Companyâs operations and to provide guarantees to support its operations. The Companyâs principal financial assets include trade and other receivables, and cash and cash equivalent that derive directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Companyâs senior management oversees the management of these risks. The Companyâs senior management is responsible to ensure that Companyâs financial risk activities which are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Companyâs policies and risk objectives. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of change in market price. Market risk comprise of interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. However, as the Company does not have any outstanding floating rate interest bearing long term and short term debts at the balance sheet date. Therefore, a change in interest rates on the reporting date would neither affect profit or loss nor affect equity.

Fair value sensitivity analysis for fixed rate instruments

The Company does not have any fixed rate financial assets and liabilities at fair value through profit and loss. Therefore, a change in interest rates at the reporting date would neither affect profit or loss not affect equity.

Foreign currency risk

The Company is exposed to foreign exchange risk arising from foreign currency transactions primarily with respect to USD. Foreign exchange risk arises from future commercial transactions and recognised asset and liabilities denominated in a currency that is not the Companyâs functional currency. The Company imports certain materials which exposes it to foreign currency risk. The Company also exports finished goods which exposes it to foreign currency risk.

Commodity price risk

Sugar industry being cyclical in nature, realisations get adversely affected during downturn. Higher cane price or higher production than the demand ultimately affect profitability. The Company has mitigated this risk to some extent by well integrated business model by diversifying into co-generation and distillation, thereby utilizing the by-products. The Company focuses on being amongst the lowest cost producers in these businesses.

Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables, security deposits and others) and from its financing activities, including deposits with banks. Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. Credit evaluations are performed on all customers requiring credit over a certain amount.

(i) Trade receivables

Customer credit risk is managed as per the Companyâs established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on an extensive credit rating scorecard and individual credit limits are defined in accordance with this assessment. Outstanding customer receivables are regularly monitored.

An impairment analysis is performed at each reporting date on an individual basis for major customer. The calculation is based on exchange losses historical data. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed below. The Company does not hold collateral as security except for security deposites from customers. The Company evaluates the concentration of risk with respect to trade receivables as low on the basis of past default rates of its customers.

Based on the historical data, loss on collection of receivable is not material hence no additional provision considered.

(ii) Financial instruments and cash deposits

Credit risk from balances with banks is managed by the Companyâs treasury department in accordance with the Companyâs policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty. Counterparty credit limits are reviewed by the Companyâs Board of Directors on an annual basis, and may be updated throughout the year subject to approval of the Companyâs finance committee. The limits are set to minimize the concentration of risks and therefore mitigate financial loss through counterpartyâs potential failure to make payments.

Liquidity risk

The Company manages its liquidity for working capital requirement to ensure smooth operation of the business.

The Company also ensures the long term funds requirement like capex or otherwise are met through adequate availability of long term capital (debt/equity).

For the purpose of the Companyâs capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders of the Company. The primary objective of the Companyâs capital management is to maximise the shareholder value.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company includes within net debt, interest bearing loans and borrowings, trade and other payables, less cash and cash equivalents.

In order to achieve this overall objective, the Companyâs capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings.

No changes were made in the objectives, policies or processes for managing capital during the year ended March 31, 2025 and March 31, 2024.

41 Pursuant to judgment dated May 10, 1996 passed by the Honâble Supreme Court of India in a public interest litigation, the Company had surrendered 46.58 acres of land to the Delhi Development Authority (âDDAâ) for development of green belt and open spaces as directed by the Court.

DDA leased out some portion of the surrendered land Delhi Metro Rail Corporation (âDMRCâ) for a commercial consideration. The Company challenged the leasing of surrendered land to DMRC before the Honâble Supreme Court. Honâble Supreme Court vide its Order dated March 25, 2010 directed that DDA, cannot use the surrendered land for any purpose other than the specified use and further directed that any consideration received for a commercial use of the surrendered land would entitle the Company to get fifty percent (50%) of such consideration.

In terms of the above directions of the Honâble Supreme Court, the Company had received in earlier years a sum of Rs. 15.92 crore. Since there was delay in making payments, the Company has demanded interest on delayed payments by filing suit in Delhi High Court which is pending.

42 The Company had executed a Business Transfer Agreement on November 18, 2016 with Indian Potash Limited (IPL) and sold off its Agreed Assets and Liabilities excluding contingent liabilities of Titawi Sugar Complex (unit) as a going concern on an âAS IS WHERE IS WHAT ISâ basis by way of a slump sale. The sale was governed by a Business Transfer Agreement (BTA) which stipulated completion of certain activities within a certain time frame.

A sum of Rs. 2.10 crore (March 31,2024 Rs. 2.10 crore) is recoverable from IPL, out of which Rs. 2.00 crore (March 31, 2024 Rs 2.00 crore) pertains to pending transfer of certain portion of freehold land in the name of IPL and balance of Rs. 0.10 crore (March 31,2024 Rs. 0.10 crore) pertains to other matters. The management expects the same to be recovered in full post completion of the specified conditions.

* During the previous year, the Company had granted a loan of Rs. 7.20 crore to Siel Industrial Estate Limited (Siel IE), (an erstwhile wholly owned subsidiary company) for a period of upto two years at the rate of interest of 9.50% per annum. Further, the Company also sanctioned an unsecured loan of Rs. 4.00 crore for a period of two years at the rate of interest of 9.50% per annum, out of which Rs. 0.50 crore was disbursed till previous year and Rs.0.80 crore has been disbursed during the current year. Entire loan has been repaid by the subsidiary during the current year.

During the financial year 2021-22, the Company had provided an unsecured loan of Rs. 1.00 crore to Siel IE repayable on call for a period of upto one year at the rate of interest of 9.50% per annum. The said loan was extended for further period of one year during the previous year and is further extended for a period of one year during the current year on the existing terms and conditions. Entire loan has been repaid by the subsidiary during the current year.

45 (a) During the previous year, the Company had sold non-agricultural land admeasuring 40.493 acres situated at Village Bajhera Kalan, Tehsil-Hapur, Uttar Pradesh for a total consideration of Rs. 28.13 crore and accounted for a gain of Rs. 23.38 crore (net of commission) which was included under the head âother incomeâ.

(b) Pursuant to a favorable order from the Honâble National Company Law Appellate Tribunal (NCLAT) which set aside the order passed by CCI for alleged contravention of provisions of The Competition Act, 2002 in respect of joint tender floated by Oil Marketing Companies (OMCs) for supply of Ethanol, the Company had recorded income amounting to Rs. 2.45 crore during the previous year and the same was included under âother incomeâ.

(c) Pursuant to a favorable order received from Honâble High Court of Delhi against an ex-vendor in 2015 and its execution petition filed in 2021, the Company has received an Arbitration Award of Rs. 2.20 crore during the year and included the same under âOther Incomeâ.

46 In view of Honâble Allahabad High Court order dated December 21,2017 for stay on the retrospective operation of orders of UP State Government on reduction in rate of society commission pertaining to earlier years, the Company had provided differential amount of Rs. 28.55 crore in the books of accounts during earlier years. UP Sugar Mill Association had approached Honâble Supreme Court of India for stay of operation of the said High court order during an earlier year. The matter is pending before Honâble Supreme Court.

47 The Code on Social Security, 2020 (âCodeâ) relating to employee benefits during employment and post-employment benefits received Presidential assent in September 28, 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period when the Code becomes effective.

48 Recovery Certificates (RC) were issued in the past by the Cane Commissioner for payment of Cane Dues, Society Commission, interest on delayed cane payments etc. for previous crushing seasons together with collection charges as per Rules.

The Company had paid all the cane dues to the farmers and challenged the levy of âcollection chargesâ before the Honâble High Court of Allahabad by filing writ petitions for some of the years. Honâble High Court of Allahabad allowed the writ petitions for these years and quashed the demand of collection charges by the State Government. In view of the management, the legal position settled by High Court in this matter has attained finality and the State Government has not challenged it before any superior court.

However, the demand for collection charges for the years 2012-13 to 2015-16 amounting to Rs. 141.33 crore (Previous year Rs. 141.33 crore) are still pending. These demands are also liable to be quashed on the same ground as in the earlier years and Company has initiated necessary process in this regard with the relevant authorities and thus, potential liability is considered to be remote.

State Governmentâs waiver of interest on delayed cane payments by sugar mills has been involved in legal proceedings before Honâble High Court of Allahabad for sugar season 2012-13 to 2014-15 and a formal demand for payment of any interest for the said sugar seasons aforementioned, has not been raised. However, as good corporate governance and as an abundant caution, the Company has disclosed a contingent liability in respect of interest on delayed cane payment of Rs. 479.86 crores upto March 31,2025 (March 31,2024 : Rs. 477.79 crore) under Note 32.B(b)(ii), (including a liability of Rs. 144.80 crore (March 31, 2024 : Rs. 144.80 crore) based on demand notice from Cane Commissioner of UP for the sugar season 2012-13 to 2014-15).

Consequent upon the directions of the Honâble High Court to the Cane Commissioner to decide afresh the matter on the delayed cane payments, Company and the sugar industry has represented to the Cane Commissioner for waiver, which is yet to be decided by Cane Commissioner. The Company is hopeful to get the waiver from State Government. Based on the legal review of the facts of this case, possibility of any further liability (including interest thereon) crystalizing is remote and hence, no provision is considered necessary.

49 As at March 31, 2024, the Company held 67,59,801 (33.74%) equity shares in Mawana Foods Private Limited (âMFPLâ) and was an associate company. During the current year, the Company has purchased balance 1,32,77,049 (66.26%) fully paid-up equity shares of Rs. 10/- each held by Usha International Limited (UIL) in Mawana Foods Private Limited (MFPL) for a total consideration of Rs. 2.42 crore. The Share Purchase and the business acquisition has been completed and accordingly, MFPL has become a wholly owned subsidiary of Mawana Sugars Limited w.e.f. December 31, 2024.

Till the year ended March 31, 2024, the Company recorded an impairment allowance of Rs. 12.17 crores. Further, based on the current purchase price, the Company recognized an additional impairment allowance to the extent of excess carrying value over its value in use by Rs 1.60 crore in the financial statements and disclosed the same as exceptional item.

50 A committee of independent directors in their meeting dated July 13, 2024 and thereafter on August 31,2024 resolved to sell the equity and preference shares of its subsidiary companies namely SIEL Industrial Estate Limited (âSiel IEâ) and SIEL Infrastructure and Estate Developers Private Limited (âSiel IEDâ), along with all their respective assets and liabilities, on âAS IS WHERE ISâ basis subject to the completion of legal due diligence.

In relation to the above, the Company entered into Memorandum of Understanding (MOU) on September 07, 2024 with M/ s Singla Builders and Promotors Limited (âSBPâ) for sale of Equity and Preference Shares along with all their respective assets and liabilities, on âAS IS WHERE ISâ for a total consideration of Rs 117.00 crore, including repayment of loans aggregating to Rs. 9.50 crore given by the Company to Siel IE. The Share Purchase Agreement was signed on October 11,2024 and consideration was received by the Company during the year. The Company derecognised its investments in the said subsidiaries and recorded a net gain of Rs. 22.99 crore which has been disclosed as an exceptional item.

Further, during the tax financial year ended March 31,2013, the Company had sold equity shares of Siel-IE to Siel-IED for a consideration of Rs. 135.02 crore resulting in profit of Rs. 121.54 crore, However, this profit was not recorded during the same year in view statutory auditorsâ qualification. Based on opinions from tax experts and legal precedents, Company has considered the cost of acquisition of shares of Siel IED at Rs. 135.02 crore for the purpose of determination of tax liability relating to the above transaction and is determined at Rs. 7.17 crore.

51 The Company sells sugar as per Sugar Sales Mechanism issued by Ministry of Consumer Affairs, Food and Public Distribution under which monthly sales quota is allocated to sugar mills in the country. As on March 31,2025, the Company is carrying inventory of sugar of Rs. 719.50 crore (comprising finished goods Rs. 705.58 crore and work in progress Rs. 13.92 crore) (March 31, 2024 Rs. 743.45 crore (comprising finished goods Rs. 731.79 crore and work in progress Rs. 11.66 crore)) with valuation at lower of cost and net realizable value.

Future net realizable value shall be dependent upon the factors on minimum support price, monthly sale quota and sugar production in the Country. The Company expects to realise the value at least to the extent stated in the accounts.

53 Other Statutory Information

(i) The Company does not have any Benami property, where any proceeding has been initiated or pending against the company for holding any Benami property under the Benami Transaction (Prohibition) Act, 1988 & rules made thereunder.

(ii) The Company does not have any transaction with struck off companies under Section 248 of the Companies Act, 2013.

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

(iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

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

a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or (b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries

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

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

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

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

(viii) The Company has not been declared a wilful defaulter by any bank or financial institution or other lender (as defined under the Companies Act, 2013) or consortium thereof, in accordance with the guidelines on wilful defaulters issued by the Reserve Bank of India.

54 The Company has been sanctioned working capital limits in excess of Rs. five crores in aggregate from a bank during the year on the basis of security of current assets of the Company. The Company has filed the quarterly returns/statements with such bank during the year which are in agreement with the books of accounts of the Company.

55 On February 07, 2025, the Company received a letter for inspection under Section 206(5) of the Companies Act, 2013 from the Ministry of Corporate Affairs (MCA) seeking certain information. The Company has duly submitted all the requisite information under its letter dated February 17, 2025 and MCA has not reverted to the Company after the receipt of the requisite information. Based on expert legal inputs and considering that the information sought in present proceedings are essentially the same as in previous inspection in financial year 2021-22 where no adverse findings report was issued by MCA, the Company is confident that no adverse impact is likely to arise in this regard.

56 Based on a legal assessment, the Company has determined that the Company is not required to spend any amount during the current year pursuant to its Corporate Social Responsibility Policy as required by the Section 135(5) of the Companies Act, 2013 since it does not have net profits during the last three preceding years owing brought forward excess of expenditure over income as referred to in Explanation (l) to Section 198 of the Companies Act, 2013.

57 The Company has migrated to SAP Rise from SAP ECC 6.0 during the year. The accounting software used for maintaining its books of account has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software except that audit trail feature is not enabled for certain changes that can be made using certain privileged/ administrative access rights. Further, audit trail feature was not enabled for part of the year at database level for the SAP ECC 6.0 software for part of the year. Further, there are no instance of audit trail feature being tampered with in respect of accounting software except in regards to privileged/administrative access rights / database level in SAP ECC 6.0 software. Additionally, the audit trail of prior year has been preserved by the Company as per the statutory requirements for record retention to the extent it was enabled and recorded in the prior year.

Mar 31, 2024

* During the current year, the Company has granted a loan of Rs. 7.20 crore to Siel Industrial Estate Limited (Siel IE), (a wholly owned subsidiary company) for a period of upto two years at the rate of interest of 9.50% per annum. Further, the Company has also sanctioned an unsecured loan of Rs. 4.00 crore for a period of two years at the rate of interest of 9.50% per annum, out of which Rs.0.50 crore has been disbursed till March 31,2024.

** During the financial year 2021-22, the Company had provided an unsecured loan of Rs. 1.00 crore to Siel IE repayable on call for a period of upto one year at the rate of interest of 9.50% per annum. The said loan was extended for further period of one year during the previous year and is further extended for a period of one year during the current year on the existing terms and conditions.

*** The Company had, during earlier years, given loans amounting to Rs. 3.66 crore to SIEL Financial Services Limited and Rs. 11.51 crore to SFSL Investment Limited, the erstwhile subsidiaries of the Company for general business purpose and Rs. 0.13 crore to others. Such loans were fully impaired in the books of accounts during the earlier years. The Company has written off the said loans during the current year.

b) Terms/ rights attached to equity shares:

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each share holder of equity shares is entitled to one vote per share except 1,192 equity shares held by Siel Infrastructure & Estate Developers Private Limited, a subsidiary which pursuant to second proviso of Section 19(1) of the Companies Act, 2013, has no right to vote at meeting of the Company. Each holder of equity shares have a right to receive per share dividend declared by the Company. In event of liquidation of the Company, holder of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amount. The distribution will be in proportion to the number of equity shares held by the shareholders.

c) Detail of final dividend

During the current year, the shareholders at its annual general meeting held on July 14, 2023 approved a dividend of 30% (i.e. Rs. 3.00 per equity share of the face value of Rs. 10 each) to the equity shareholders aggregating to Rs. 11.73 crore for the financial year ended March 31,2023, which was deposited with the scheduled bank within the prescribed time.

d) Detail of final dividend proposed

The Board of Directors of the Company has recommended final dividend of 40% on equity shares (Rs 4.00 per equity share of Rs.10 each), subject to approval of shareholders in ensuing Annual General Meeting, the liability of which would be recognised once this is approved by shareholders in the ensuing Annual General Meeting.

12.2 Nature and Purpose of reserve

a. Securities premium reserve is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

b. Capital redemption reserve

c. Capital Reserve Capital reserve includes :

b. Rs. 3.87 crore representing the extinguishment of preference share capital.

d. Storage fund for molasses account

During the financial year 2018-19, the Company had received soft loans of Rs. 146.00 crore through a bank under the âScheme for Extending Financial Assistance to Sugar Undertakings - 2018â as notified by UP State Government to clear the outstanding cane dues of the farmers for the sugar season 2017-18. Outstanding at the end of year Rs. 4.76 crore (March 31,2023 Rs 32.65 crore)

During the financial year 2018-19, the Company was sanctioned a term loan of Rs. 30.00 crore from a bank for installation of incinerator boiler at distillery plant located at Nanglamal Sugar Complex under the âScheme for extending financial assistance to sugar mills for enhancement and augmentation of Ethanol Production Capacityâ as notified by Department of food and public distribution, Government of India. The Company has prepaid the loan during the current year and outstanding at end of year is Rs. Nil (March 31,2023 Rs 5.62 crore)

The management at the end of each reporting period, assesses Company''s ability to recognize deferred tax assets on unabsorbed depreciation carried forward, taking into account forecasts of future taxable profits and the law and jurisdiction of the taxable items and the assumptions on which these projections are based. Based on profits earned during the current year and previous years, future profitability projections, considering expected future market, economic conditions and tax laws, the managment is confident that there would be sufficient taxable profits in future which will enable the Company to utilize the above deferred tax assets on unabsorbed depreciation.

31. Earnings per share (EPS)

32. Commitments and Contingencies(a) Leases Lease â as lessee

The Company has lease contracts for corporate office used in its operations. Generally, the Company is restricted from assigning and subleasing the leased assets. The Company also has certain leases of assets with lease terms of 12 months or less. The Company applies the short-term leases recognition exemptions for these leases, other than lease from related parties.

Rs. Crore
Particulars		Year ended
Particulars		March 31, 2024
As at April 01, 2022		0.66
Additions		0.78
Amortisation expense		(0.47)
Disposals		-
As at April 01, 2023		0.97
Additions		-
Amortisation expense		(0.47)
Disposals		-
As at March 31, 2024		0.50
Set out below are the carrying amounts of lease liabilities and the movements during the year
		Rs. Crore
	Year ended	Year ended
	March 31, 2024	March 31,2023
Opening balance	1.04	0.75
Additions	-	0.78
Accretion of interest	0.09	0.06
Payments	(0.54)	(0.55)
Closing balance	0.59	1.04
Current lease liabilities	0.52	0.46
Non current lease liabilities	0.07	0.58
Considering the lease term of the leases, the effective interest rate for lease liabilities is 11%.
The following are the amounts recognised in statement of profit and loss:		Rs. Crore
Particulars	Year ended	Year ended
Particulars	March 31, 2024	March 31,2023
Amortisation expense of right-of-use assets	0.47	0.47
Interest expense on lease liabilities	0.09	0.06
Expense relating to short-term leases (included in other expenses)	0.99	1.11
Total amount recognised in statement of profit or loss Account	1.55	1.64
For maturity analysis of lease liability, refer note 39 Financial risk management framework and policies under maturities of
financial liabilities.
The Company had total cash outflows for leases of Rs. 1.53 crore (March 31,2023 Rs 1.66 crore). There are no future cash
outflows relating to leases that have not yet commenced.
Payments associated with short-term leases other than leases from related parties are recognised on a straight-line basis as an expense in statement of profit and loss. Short-term leases are leases with a lease term of 12 months or less.
(b) Commitments		Rs. Crore
Particulars	As at	As at
Particulars	March 31, 2024	March 31,2023
a. Estimated amount of contracts remaining to be executed on capital account and	7.39	8.36
not provided for:
b. Uncalled liability on shares and other investments partly paid (# Rs. 20)	#	#
Total	7.39	8.36

(c) Contingent Liabilities in repsect of Income Taxes/Central Excise/Service Tax/Value Added Tax and other taxes Rs. Crore
(i)	Nature of Dispute	Description			Period		As at March 31,2024		As at March 31,2023
	Central Excise, State Excise, Service Tax and Goods and Service Tax	Demand Notice received from Central Excise, Service Tax and Goods & Service Tax Department towards wrong availment of cenvat credit taken, dispute on levy of service tax and excise duty and penalty/Interest imposed			1994-95 to 199697, 1998-99, 19992000 to 2002-03, 2006-07, 2004-05 to 2016-17 and 2019-20		2.52		2.12
	House Tax and Water Tax	House Tax and Water Tax dispute with Nagarpalika Parishad, Mawana, pending reassessment			2007-08 to 2023-24		2.32		^-
					Total (i)		4.84		2.12
(ii) Other Matters under disputes are as below: Rs. Crore
	Nature of Dispute		Description	Period		As at March 31, 2024		As at March 31,2023
	Land		Land related disputes	1985-86, 1975-76, 2007-08 to 2023-24		0.10		0.10
				Total		0.10		0.10
	Labour		Labour related disputes	2006-07, 2008-09 and 2010-11		0.40		0.37
				1997-98, 1999-2000 to 2002-03, 2008-09, 2010-11 and 2012-13		0.92		0.92
				1999-2000, 2005-06, 1996-97, 1993-94, 1992-93, 1985-86, 1995-96, 1992-93, 2014-15, 2018-19, 2021-22, 2022-23 and 2023-24		1.37		1.51
				Total		2.69		2.80
			Others	2010-11 and 2022-23		0.31		0.36
				Total		0.31		0.36
	Interest on cane Price / Commission Arrears		Interest on delay payment of cane dues (Refer note 48)	2002-03, 2006-07, 2012-13 to 2023-24		477.79		471.78
				Total		477.79		471.78
				Total (ii)		480.89		475.04
	Grand Total ((i) (ii))					485.73		477.16

(!!!) The Company had provided a bank guarantee amounting to Rs. 7.20 crore (March 31,2023 Rs. 7.20 crore) to Tecumseh Products India Limited (TPIL), to whom it had sold the compressor business in an earlier year, for any loss, damage, claim, action, suit etc., arising from various representations /breach of representations including for contingent liabilities existing on and prior to March 31, 1997, which TPIL may eventually be liable to pay, against which demands in respect of sales tax, central excise and civil matters are pending.

During the current year, out of the above said contingent liabilities, cases related to central excise have been decided by the Hon''ble High Court of Andhra Pradesh vide its order dated March 19, 2024 in favour of TPIL. The amount involved in each of the central excise matter was less than Rs. One crore and based on the legal view of the Company, the decision of the Hon''ble High Court cannot be challenged in any superior court in view of a circular issued by the Central Board of Indirect Taxes whereby the excise department has been restrained from filing any appeal in cases where the disputed liability is less than Rs. One crore. The said circular has also been relied upon by the Hon''ble High Court in its abovesaid Judgment dated March 19, 2024. Accordingly, the Company is entitled to get back the duly discharged the bank guarantee amounting to Rs 6.92 crore from TPIL.

(iv) During the earlier years, the Company had given a counter indemnity/guarantee in favor of existing directors of Transiel India Limited to protect their interest against any loss/ future liabilities that may arise after the name of the said subsidiary that has been struck off under the Easy Exit Scheme, 2011.

(v) There are numerous interpretative issues relating to the Supreme Court (SC) judgement on Provident Fund (PF), dated February 28, 2019. The Company will make necessary provision on receiving further clarity on the subject.

(v!) During the earlier year, Income Tax department had passed an assessment order for the assessment year 201718 under Section 143(3) of the Income Tax Act, 1961, wherein the assessing officer had disallowed / added back certain items resulting into adjustment of brought forward losses/unabsorbed depreciation by Rs. 336.40 crore under normal provisions of the Income Tax Act. Under Section 115JB (MAT), the assessing officer raised demand of Rs. 13.90 crore (including interest of Rs. 4.53 crore) and further interest demand on the above demand of Rs. 5.25 crore has been raised. Against the total tax demand of Rs. 19.15 Crore, the Company is carrying provision of Rs. 14.54 crore (March 31,2023 Rs. 14.24 crore) ((including interest of Rs. 5.37 crore (March 31,2023 Rs. 5.06 crore)).

However, based on the legal opinion taken by the Company, additions/demands are not sustainable under the provisions of the Income Tax Act. An appeal had been filed by the Company in the earlier year against the above said order with CIT(Appeal) which is under hearing and an application under Section 154 of the Income Tax Act for the rectification of the said additions/demands has also been filed in an earlier year with the Assessing Officer. The Company has already deposited (including adjustment of income tax refund of the subsequent years) a sum of Rs 7.65 crore (March 31, 2023 Rs. 6.27 crore) under protest against the above demand amount. During the current year, a stay has been granted against the demand by the Assessing Officer.

(vii) During the earlier year, Income Tax department had passed an assessment order for the assessment year 201819 under Section 143(3) of the Income Tax Act, 1961, wherein the assessing officer had disallowed / added back certain items resulting into adjustment of brought forward losses/unabsorbed depreciation by Rs. 20.30 crore under normal provisions of the Income Tax Act. An appeal had been filed by the Company in the earlier year against the above said order with CIT(Appeal) which is under hearing.

(vii!) Other Income tax demand for the asssessment year 2007-08 amounting to Rs. Nil (March 31, 2023 Rs. 0.04 crore) and assessment year 2021-22 amounting to Rs. 0.06 crore (March 31,2023 Rs. 0.06 crore).

37. Segment InformationA. Operating Segment

As per Ind AS 108 identification of segment is based on the manner in which the entity''s Chief Operating Decision Makers'' (CODM) reviews the business components regularly to make decisions about allocating resources to segment and in assessing its performance.

The Operating segments of the Company are identified as Sugar, Power and Distillery as the Chief Operating Decision Maker reviews business performance of the Company on the basis of these segments.

B. Geographical Segment

The Company mainly caters to domestic markets. However, there is export/deemed export of Sugar which has been presented in geographical segment.

C. Segment accounting policies

In addition to the significant accounting policies applicable to the business segments as set out in note 2 above, the accounting policies in relation to segment accounting are as under:

i) Segment revenue and expenses:

Segment revenue and expenses are directly attributable to the segments.

ii) Segment assets and liabilities:

Segment assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fixed assets, net of allowances and provisions which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities. While most of the assets/ liabilities can be directly attributed to individual segment, the carrying amount of certain assets/ liabilities pertaining to two or more segments are allocated to the segments on a reasonable basis.

iii) Inter segment revenues:

Inter segment revenues between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

(ii) Non-current assets: The Company has common property, plant and equipment for manufacturing goods, hence, these are not separately identifiable.

Information about major customer :

Revenue from Contracts with customers includes Rs. 20.41 crore (March 31, 2023 Rs. 181.01 crore) arising from Garden Court Distilleries Private Limited which contributes approx. 1.51% (March 31,2023 12.25%) of revenue.

38. A. Fair values

Set out below, is a comparison by class of the carrying amounts and fair value of the Company''s financial instruments, other than those with carrying amounts that are reasonable approximations of fair values.

38. A. Fair values (Contd.)

B. Fair Value Hierarchy

Level 2 : Valuation techniques for which the lowest level inputs that has a significant effect on the fair value measurement are observable, either directly or indirectly.

Level 3 : Valuation techniques for which the lowest level input which has a significant effect on fair value measurement is not based on observable market data.

The following table provides the fair value measurement hierarchy of the Company''s assets and liabilities.

The Company''s principal financial liabilities comprise of borrowings, trade payables, other payables, security deposits received, capital creditors and employee related payables. The main purpose of these financial liabilities is to finance the Company''s operations and to provide guarantees to support its operations. The Company''s principal financial assets include trade and other receivables, and cash and cash equivalent that derive directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Company''s senior management oversees the management of these risks. The Company''s senior management is responsible to ensure that Company''s financial risk activities which are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company''s policies and risk objectives. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Market risk

Interest rate risk

Fair value sensitivity analysis for fixed rate instruments

Foreign currency risk

The Company is exposed to foreign exchange risk arising from foreign currency transactions primarily with respect to USD. Foreign exchange risk arises from future commercial transactions and recognised asset and liabilities denominated in a currency that is not the Company''s function currency. The Company imports certain materials which exposes it to foreign currency risk. The Company also exports finished goods which exposes it to foreign currency risk.

Commodity price risk

Sugar industry being cyclical in nature, realisations get adversely affected during downturn. Higher cane price or higher production than the demand ultimately affect profitability. The Company has mitigated this risk to some extant by well integrated business model by diversifying into co-generation and distillation, thereby utilizing the by-products. The Company focuses on being amongst the lowest cost producers in these businesses.

Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks. Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. Credit evaluations are performed on all customers requiring credit over a certain amount.

(i) Trade receivables

Customer credit risk is managed as per the Company''s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on an extensive credit rating scorecard and individual credit limits are defined in accordance with this assessment. Outstanding customer receivables are regularly monitored.

An impairment analysis is performed at each reporting date on an individual basis for major clients. The calculation is based on exchange losses historical data. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed below. The Company does not hold collateral as security except for security deposites from customers. The Company evaluates the concentration of risk with respect to trade receivables as low on the basis of past default rates of its customers.

Based on the historical data, loss on collection of receivable is not material hence no additional provision considered.

(ii) Financial instruments and cash deposits

Credit risk from balances with banks is managed by the Company''s treasury department in accordance with the Company''s policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty. Counterparty credit limits are reviewed by the Company''s Board of Directors on an annual basis, and may be updated throughout the year subject to approval of the Company''s finance committee. The limits are set to minimize the concentration of risks and therefore mitigate financial loss through counterparty''s potential failure to make payments.

Liquidity risk

The Company manages its liquidity for working capital requirement to ensure smooth operation of the business.

The Company also ensures the long term funds requirement like capex or otherwise are met through adequate availability of long term capital (debt/equity).

For the purpose of the Company''s capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders of the Company. The primary objective of the Company''s capital management is to maximise the shareholder value.

No changes were made in the objectives, policies or processes for managing capital during the year ended March 31, 2024 and March 31,2023.

41. Pursuant to judgment dated May 10, 1996 passed by the Hon''ble Supreme Court of India in a public interest litigation, the Company had surrendered 46.58 acres of land to the Delhi Development Authority (âDDA'') for development of green belt and open spaces as directed by the Court.

DDA leased out some portion of the surrendered land Delhi Metro Rail Corporation (âDMRC'') for a commercial consideration. The Company challenged the leasing of surrendered land to DMRC before the Hon''ble Supreme Court. Hon''ble Supreme Court vide its Order dated March 25, 2010 directed that DDA, cannot use the surrendered land for any purpose other than the specified use and further directed that any consideration received for a commercial use of the surrendered land would entitle the Company to get fifty percent (50%) of such consideration.

In terms of the above directions of the Hon''ble Supreme Court, the Company had received in earlier years a sum of Rs. 15.92 crore. Since there was delay in making payments, the Company has demanded interest on delayed payments by filing suit in Delhi High Court which is pending.

42. The Company executed a Business Transfer Agreement on November 18, 2016 with Indian Potash Limited (IPL) to sell off its Agreed Assets and Liabilities excluding contingent liabilities of Titawi Sugar Complex (unit) as a going concern on an âAS IS WHERE IS WHAT IS'' basis by way of a slump sale. The sale was governed by a Business Transfer Agreement (BTA) which stipulated completion of certain activities within a certain time frame.

A sum of Rs. 2.10 crore (March 31,2023 Rs. 2.10 crore) is recoverable from IPL, Out of which Rs. 2.00 crore (March 31,2023 Rs 2.00 crore) pertains to pending transfer of certain portion of freehold land in the name of IPL and balance of Rs. 0.10 crore (March 31,2023 Rs. 0.10 crore) pertains to other matters.

* During the current year, the company has granted a loan of Rs. 7.20 crores to Siel Industrial Estate Limited (Siel IE), (a wholly owned subsidiary company) for a period of upto two years at the rate of interest of 9.50% per annum. Further, the Company has also sanctioned an unsecured loan of Rs. 4.00 crore for a period of two years at the rate of interest of 9.50% per annum, out of which Rs.0.50 crore has been disbursed till March 31,2024.

45. (a) The Company had classifed a parcel of non-agricultural land at village Bajhera Kalan as âAssets held for saleâ as at March 31, 2023 in view of highly probable sale of such land. The said land was sold for a total consideration of Rs 28.13 crore during the current year and gain on sale of land of Rs 23.38 crore (net of commission) has been included in other income.

(b) Hon''ble National Company Law Tribunal (NCLAT) vide its order dated October 10, 2023, has set aside order passed by the Hon''ble Competition Commission of India (CCI) dated 18.09.2018 for alleged contravention of provisions of The Competition Act, 2002 in respect of joint tender floated by Oil Marketing Companies (OMCs) for supply of Ethanol. As a result, other income includes write back of provision amounting to Rs 2.45 crore during the current year.

46. In view of Hon''ble Allahabad High Court order dated 21.12.2017 for stay on the retrospective operation of orders of UP State Government on reduction in rate of society commission pertaining to earlier years, Company had provided differential amount of Rs. 28.55 crore in the accounts during earlier years. UP sugar mill association had approached hon''ble Supreme Court for stay of operation of high court order during an earlier year. The matter is pending before Supreme Court.

47. The Code on Social Security, 2020 (âCode'') relating to employee benefits during employment and post-employment benefits received Presidential assent in September 28, 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period when the Code becomes effective.

48. In the earlier years, Recovery Certificates (RC) were issued by the Cane Commissioner for payment of Cane Dues, Society Commission, interest on delayed payments etc. for previous crushing seasons. The RC also mentioned that the recovery officer shall also collect âcollection charges'' as per Rules. The Company had paid all the dues of the farmers on its own and challenged the levy of âcollection charges'' before the Hon''ble High Court of Allahabad by filing writ petitions.

Hon''ble High Court of Allahabad, following the principle of law laid down by Full Bench of the High Court in the case of Maharajwa Sugar Mills Vs State of UP, allowed the writ petitions filed by the Company for the year 2006-07, 201011 and 2012-13 and quashed the levy of the collection charges and consequent demand for the same by the State Government. However, petitions for the same issue of levy of âcollection charges'' for the years 2012-13 to 2015-16 are still pending and the total demand of collection charges for those years is Rs. 141.33 crore as on March 31,2024 (March 31, 2023 Rs 141.33 crore). The Company had paid the entire dues for the years where petitions are still pending on its own without any further action by the State Government.

The Company has been legally advised that the pending petitions would also be decided in favour of the Company following the Court''s own decision in other years and also following the authoritative Full Bench Judgment by the Hon''ble High Court of Allahabad in Maharajwa Sugar Mills case, which has attained finality as the State Government has not challenged the said judgment in any superior court, no âcollection charges'' could be recovered where the State Government had taken no further steps for recovery of the dues mentioned in RC except issuing the âdemand notice'' and âcitation'' and such amount had been directly paid by the sugar mills to the farmers on its own.

Further, Cane Commissioner of UP had issued a demand notice for Rs. 144.80 crore (March 31, 2023: Rs. 144.80 crore) towards interest on delayed cane payments for the sugar season 2012-13, 2013-14 and 2014-15. However, even without there being any demand of interest for any other years for which a contingent liability of Rs. 477.79 crore (March 31,2023: Rs. 471.78 crore) (including the demand of Rs. 144.80 crore) up to March 31,2024 is being shown in the note 32(c)(ii). In response to industry representation against the demand of interest on delayed cane payments, a waiver notification was issued by the Principal Secretary, Government of Uttar Pradesh on May 22, 2015 whereby the interest on delayed cane payments was waived off for sugar seasons 2012-13, 2013-14 and 2014-15.

The said Notification of waiver of interest by the State Government was challenged in a PIL filed in the Allahabad High Court. Hon''ble Allahabad High Court disposed of the said PIL vide its Order dated March 09, 2017 directing the Cane Commissioner to decide afresh the issue as to whether the Sugar Mills are entitled for waiver of interest on the delayed payment of the price of sugarcane for the sugar seasons 2012-13, 2013-14 and 2014-15 under the provisions of Section 17(3) of the U.P. Sugarcane (Regulations of Supply and Purchase) Act, 1953. Consequent upon the directions of Hon''ble High Court to the Cane Commissioner to decide afresh the matter of interest on delayed cane payments, Company has given a representation to the Cane Commissioner for waiver of the same in the case of the Company. The representation by the Company is yet to be decided by the Cane Commissioner. The Company is hopeful to get the waiver from State Government. Based on the legal review of the facts of this case, possibility of liability crystalizing is remote and hence no provision is considered necessary.

49. Impairment indicators were identified on the investment and recoverable amounts in subsidiaries, namely Siel Industrial Estate Limited(âSIEL IE'') and Siel Infrastructure & Estate Developers Private Limited (âSIEL IED'') and an associate Mawana Foods Private Limited. The Company at the year end has an outstanding investment of Rs. 85.34 crore (March 31,2023 Rs. 83.78 crore) in said subsidiaries and associate. Also, amount of Rs. 2.47 crore (March 31,2023 Rs. 1.69 crore) and Rs. 8.73 crore (March 31,2023 Rs. 5.81 crore) is receivable from the associate and subsidiaries respectively.

In case of Subsidiaries, impairment assessment has been carried out by getting the assets valuation from an independent valuer and there is no impairment loss which is required to be recognized. The assets of the subsidiary companies mainly consists of industrial land (held as inventory) in the books of account of SIEL IE. SIEL IE had entered into a memorandum of understanding with Government of Punjab which mandated the development of the said land held as inventory within ten years of receiving the unencumbered possession of the land. A letter was received from the Government of Punjab, Department of Industries & Commerce (Land Acquisition Branch) confirming the period of ten years for development of industrial land begins from October 05, 2011 i.e. the date on which SIEL IE received clear & unencumbered possession of land. Subsequently, SIEL IE obtained extension for the development of the land for a further period of 3 years and is valid till October 04, 2024. During the current year, SIEL IE has filed another application for further extension of three years for completion of the development of land for which application is pending consideration by Government of Punjab. Based on a legal opinion and internal views of the management, the management believes that it will be able to secure the said extension.

In case of Associate, the management has carried out impairment assessment on the value of investment. On account of excess of carrying value of investment in associate over the net worth as per standalone financial statement of the associate company namely âMawana Foods Private Limitedâ, the Company has performed an impairment test to ascertain the recoverable amount of investment. The recoverable amount is determined based on value in use calculation. These calculation uses management assumptions and pre-tax cash flow projections based on financed budgets approved by management of the associate company covering a 5-year period. Cash flow projection beyond 5 years'' time period are extrapolated using the estimated growth rates which is in line with industry growth rate. The Management has determined following assumptions for impairment testing of investment:

On the basis of calculations performed, the Company assessed the recoverable amount of the investment being equal to its carrying value. However, provision amounting to Rs. 12.17 crore (including Rs 1.62 crore recognised during the previous year under the head âExceptional Itemsâ).

50. The Company sells sugar as per Sugar Sales Mechanism issued by Ministry of Consumer Affairs, Food and Public Distribution under which monthly sales quota is allocated to sugar mills in the country. As on March 31, 2024, the Company is carrying inventory of sugar of Rs. 743.45 crore (comprising finished goods Rs. 731.79 crore and work in progress Rs. 11.66 crore) (March 31, 2023 Rs 506.79 crore (comprising finished goods Rs. 496.21 crore and work in progress Rs. 10.58 crore)) with valuation at lower of cost and net realizable value. Future net realizable value shall be dependent upon the factors on minimum support price, monthly sale quota and sugar production in the Country. The Company expects to realise the value at least to the extent stated in the accounts.

52. Other Statutory Information

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

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

(iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

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

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

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

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

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

53. The Company has used accounting software for maintaining its books of account which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software, except that audit trail feature is not enabled at database level and also for certain changes that can be made using certain privileged/ administrative access rights in the software. Further, no instance of audit trail feature being tampered with was noted in respect of accounting software.

Mar 31, 2018

1. Company Overview

Mawana Sugars Limited (âthe Company'') is a public limited Company domiciled and incorporated in India under the provisions of the Companies Act, 2013. Its shares are listed on two recognized stock exchanges in India. The registered office of the Company is situated at 5^th floor, Kirti Mahal, 19 Rajendra Place, New Delhi 110008. As at March 31, 2018, Mr. Siddharth Shriram (including shares held as trustee of Enterprise Trust) owns 63.49% of equity share capital of the Company.

The standalone financial statements were approved by the Board of Directors and authorised for issue on 23rd May 2018.

Notes :

1. Refer note 42

2. Refer note 13 for information on property, plant and equipment pledged as security.

3. The Company has reassessed and made downward revision in the useful life of certain plant and equipment of Sugar units of the Company, in view of this change, the depreciation for the year is higher by Rs 4.26 million. However there is no impact on the results of the Company since these assets have already been sold/are held for sale.

No trade or other receivables are due from directors of the Company.

Trade receivables except Mawana Foods Private Limited are non interest bearing during normal credit periods and are generally on terms of 30 days.

* The Company had changed its Authorised Share Capital from 175,000,000 Equity Shares of Rs. 10/- each to 100,000,000 Equity shares of Rs. 10/- each aggregating to Rs.1,000 million and 7,500,000 Preference Shares of Rs. 100/- each aggregating to Rs.750 million in AGM held on 13.06.2016.

b) Terms/ rights attached to equity shares:

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each share holder of equity shares is entitled to one vote per share except 1,192 equity shares held by Siel Infrastructure & Estate Developers Private Limited, a subsidiary which pursuant to second proviso of Section 19(1) of the Companies Act, 2013, has no right to vote at meeting of the Company. Each holder of equity shares have a right to receive per share dividend declared by the Company. In event of liquidation of the Company, holder of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amount. The distribution will be in proportion to the number of equity shares held by the shareholders.

During the year, no interim/ final dividend has been paid or proposed by the Company.

#a The Company has completely resolved the debts availed from all the lender banks, with the One Time Settlement (OTS) concluded with the last lender bank and paid entire OTS amount during the period. The Company has recognized reversal of loan and interest liabilities with net gain of Rs. 190.87 million under exceptional items in the Statement of Profit and Loss.

#b During the period ended March 2016, pursuant to an assignment of all rights, titles and interest in the financial assistance i.e Long term borrowings, Short term borrowing, cash credit, Funded Interest Term Loan and interest thereon outstanding with two term lenders assigned to an Asset Reconstruction Company, an amount of Rs. 2,210.00 million which was earlier restructured for repayment till March 2023 resulted in NPV gain of Rs. 1520.77 million, same was credited to retained earnings as on April 01,2016. This loan has been rescheduled for repayment till March 2021 in the previous year ended March 31, 2017 resulted in NPV loss of Rs. 287.60 million which has been reflected as a loss under exceptional item in the Statement of Profit and Loss.

The Company has resolved its debt liability with one more lender during the previous year ended March 31, 2017, by way of one time settlement (OTS), which resulted in the waiver of principal and interest amounting to Rs. 405.32 million and has been reflected as a gain under exceptional item in the Statement of Profit and Loss. In terms of the settlement, the OTS amount is payable till 30th June, 2018.

#c During the year ended March 31, 2017, The Company had effected one time settlement agreements with three lenders and paid the entire agreed amount, which resulted in the waiver of principal and interest amounting to Rs. 1028.23 million and has been reflected as a gain under exceptional item in the Statement of Profit and Loss.

B. Loans repayable on demand - Cash credit/overdrafts from banks

i. Cash credit / overdraft amounting to Nil (31 March, 2017 Nil; 1 April, 2016 Rs. 422.10 million) were secured by first pari-passu charge on the current assets of the Company and third pari-passu charge on the property, plant and equipments of sugar units of the Company. This limit was also secured by second pari-passu charge on the property, plant and equipments of chemical division of the Company. Further, these loans were also secured by corporate guarantee issued by Siel Industrial Estate Limited and equitable mortgage of its industrial estate land measuring 455.23 acres at Rajpura in the state of Punjab and personal guarantee of the erstwhile Chairman and Managing Director of the Company.

ii. Cash credit amounting to Nil (31 March, 2017 Nil, 1 April, 2016 Rs. 46.34 million) were secured by first pari-passu charge on the current assets of the Company and property, plant and equipments (other than cylinder on finance lease) of chemical division of the Company situated at Rajpura in the state of Punjab.

iii The outstanding amount of the cash credit facility availed from one of the lender bank which was assigned to an Asset Restructuring Company has been merged with the total restructured debt with them and in the case of other lender bank, the same is merged with the settled amount under One Time settlement as agreed with them.

1 For maturity profile of trade payable and other financial liabilities refer note 38.

2 For explanation on the Company''s credit risk management processes, Refer note 38

3 Including interest Rs. 0.10 million (March 31, 2017 : Rs. 8.60 million, April 01,2016: Rs. 11.98 million) interest outstanding due to Micro and Small enterprises.

2. Income Tax:

The major components of income tax expense for the years ended March 31, 2018 and March 31, 2017:

The Company has till date recognised Rs. 230.34 million (March 31, 2017 Rs. 137.79 million: April 01, 2016: Rs. Nil million) as Minimum Alternate Tax (MAT) credit entitlement which represents that portion of the MAT Liability, the credit of which would be available based on the provision of Section 115JAA of the Income Tax Act, 1961. The management based on the future profitability projections is confident that there would be sufficient taxable profits in future which will enable the Company to utilize the above MAT credit entitlement.

The Company has till date recognised Rs. 1944.04 million (March 31, 2017 Rs. 1790.03 million: April 01, 2016: Rs. 2845.47 million) as deferred tax assets on unabsorbed depreciation and carried forward tax loss, which the management based on the future profitability projections is confident that there would be sufficient taxable profits in future which will enable the Company to utilize the above deferred tax assets.

3. Earnings per share (EPS)

b) The following reflects the income and share data used in the basic and diluted EPS computations:

4. Commitments and Contingencies

(a) Leases Operating Lease â as lessee

The Company has entered into the operating leases on properties with lease term upto one year. The Company has the option to renew the lease at the end of each year. There are no restrictions imposed by the lease arrangements. There are no subleases.

Finance Lease - as lessee

The Company has finance lease for chlorine cylinder. The Company''s obligation under finance leases are secured by the lessor âs title to the leased assets. Future minimum lease payments under finance leases with the present value of the net minimum lease payments are as follows.

* A sum of Rs. 30.28 million has been deposited with Income Tax Authorities and is appearing under income tax assets in the balance sheet.

# Period in respect of Income Tax represents Assessment Year

** the matter have been decided in favour of the Company but the department has preferred appeal at higher level.

(iv) The Company has provided bank guarantees aggregating Rs. 72.01 million (31 March, 2017 Rs. 72.01 million, 1 April, 2016 Rs. 72.01 million) to Tecumseh Products India Limited (TPIL), to whom it had sold the compressor business in a previous period, for any loss, damage, claim, action, suit etc., arising from various representations /breach of representations including for contingent liabilities existing as at March 31, 1997, or prior to March 31, 1997, which TPIL may eventually be liable to pay, against which demands in respect of sales tax, income tax and central excise matters aggregating Rs. 43.68 million (31 March, 2017 Rs. 43.68 million, 1 April, 2016 Rs. 43.68 million) have been received. These demands are presently under various stages of appeal.

(v) During the previous periods, the Company had given a counter indemnity/guarantee in favor of existing directors of Transiel India Limited to protect their interest against any loss/ future liabilities that may arise after the name of the said subsidiary that has been struck off under the Easy Exit Scheme, 2011.

5. Research and development costs

Research and development expenses included under relevant heads in the Statement of Profit and Loss amounting to Rs. 6.98 million (31 March, 2017 Rs. 6.00 million).

*provided for as doubtful advances

Siel Industrial Estate Limited (Siel IE) and erstwhile Chairman and Managing Director of the Company has given Corporate/personal Guarantees Rs. 5,243.00 million (March 31, 2017 Rs. 5,295.00 million, April 01, 2016 Rs. 5,295.00 million) as collateral security in favour of lenders of the Company on its behalf. Siel IE has mortgaged its industrial land measuring 455.23 acres (March 31, 2017 455.23 acres) as a collateral security in favour of lenders of the Company to secure the repayment of all debt due to Company''s lenders upto Rs. 7,869.85 million (March 31, 2017 Rs. 7,869.85 million).

6. Segment Information

A. Operating Segment

As per Ind AS 108 identification of segment is based on the manner in which the entity''s Chief Operating decision makers'' (CODM) review the business components regularly to make decisions about allocating resources to segment and in assessing its performance.

The Operating segments of the Company is identified to be sugar, power , chemicals and distillery as the Chief Operating decision maker reviews business performance of the Company on the basis of these segments.

B. Geographical Segment

Since the Company''s activities/operations are primarily within the country and considering the nature of products/ services it deals in, the risks and returns are same and as such there is only one geographical segment.

C. Segment accounting policies:

In addition to the significant accounting policies applicable to the business segments as set out in note 2 above, the accounting policies in relation to segment accounting are as under:

i) Segment revenue and expenses:

Segment revenue and expenses are directly attributable to the segments.

ii) Segment assets and liabilities:

iii) Inter segment revenues:

Inter segment revenues between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

The management assessed that cash and cash equivalents, other bank balances, unbilled revenue, fixed deposits, trade receivables, trade payables and other current financial liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

7. A. Fair Value Hierarchy

Level 1: Quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: Valuation techniques for which the lowest level inputs that has a significant effect on the fair value measurement are observable, either directly or indirectly.

Level 3: Valuation techniques for which the lowest level input which has a significant effect on fair value measurement is not based on observable market data.

The Company''s principal financial liabilities comprise of trade payables, other payables, security deposits received, capital creditors and employee related payables. The main purpose of these financial liabilities is to finance the Company''s operations and to provide guarantees to support its operations. The Company''s principal financial assets include trade and other receivables, and cash and cash equivalent that derive directly from its operations.

Market risk

Interest rate risk

Fair value sensitivity analysis for fixed rate instruments

Foreign currency risk

The Company is exposed to foreign exchange risk arising from foreign currency transactions primarily with respect to USD. Foreign exchange risk arises from future commercial transactions and recognised asset and liabilities denominated in a currency that is not the Company''s function currency. The Company imports certain materials which exposes it to foreign currency risk.

Commodity price risk

Sugar industry being cyclical in nature, realisations get adversely affected during downturn. Higher cane price or higher production than the demand ultimately affect profitability. The Company has mitigated this risk to some extant by well integrated business model by diversifying into co-generation and distillation, thereby utilizing the by-products. The Company also deals in Chlor Alkali products viz Caustic Soda, Chlorine etc, their prices are led by global as well as domestic demand and supply. The Company focuses on being amongst the lowest cost producers in these businesses.

Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks. Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. Credit evaluations are performed on all customers requiring credit over a certain amount.

(i) Trade receivables

An impairment analysis is performed at each reporting date on an individual basis for major clients. The calculation is based on exchange losses historical data. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed below. The Company does not hold collateral as security. The Company evaluates the concentration of risk with respect to trade receivables as low on the basis of past default rates of its customers.

Based on the historical data, loss on collection of receivable is not material hence no additional provision considered.

(ii) Financial instruments and cash deposits

Credit risk from balances with banks is managed by the Company''s treasury department in accordance with the Company''s policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty. Counterparty credit limits are reviewed by the Company''s Board of Directors on an annual basis, and may be updated throughout the year subject to approval of the Company''s finance committee. The limits are set to minimise the concentration of risks and therefore mitigate financial loss through counterparty''s potential failure to make payments.

Liquidity risk

The Company manages its liquidity for working capital requirement to ensure smooth operation of the business. The Company also ensures the long term funds requirement like capex or otherwise are met through adequate availability of long term capital (debt/equity).

In order to achieve this overall objective, the Company''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. There have been breach in the financial covenants (non payment of term loan installment) of one interest-bearing borrowing in the current year. However, the Company had made one time settlement with the said lender during the year. (Please refer note 13).

No changes were made in the objectives, policies or processes for managing capital during the years ended March 31, 2018 and March 31, 2017.

8. The Company has applied to Central Government for approval of remuneration paid of Rs 54.20 millions to former Managing Director (MD)/Whole Time Director (WTD)/existing Whole Time Director. In respect of application of former MD/WTD, the department has declined the request of the Company, and therefore an application is being filed for reopening.

9. Pursuant to judgment dated 10.5.1996 passed by the Hon''ble Supreme Court of India in a public interest litigation the Company surrendered 46.58 acres of land to the Delhi Development Authority (âDDA'') and dedicated it exclusively for the development of green belt and open spaces. Consequently, the Company is no longer in physical possession of 46.58 acres owned by it.

The Company had filed a Review Petition in the Hon''ble Supreme Court of India challenging the order of surrender of land to the DDA. During the pendency of this Review Petition, the DDA leased out some portion of the land surrendered by the Company to Delhi Metro Rail Corporation (âDMRC''). The Company filed an application before the Hon''ble Supreme Court of India in the pending Review Petition against the leasing of land by DDA to DMRC as this was contrary to the purpose for which the Company has surrendered and dedicated the land.

Although the Hon''ble Supreme Court of India dismissed the aforesaid Review Petition by order dated 25.3.2010 but on the Company''s application against the leasing of land by DDA to DMRC, It has stated and directed as follows : â...the DDA which holds the surrendered and dedicated land in Trust cannot use it for any purpose other than as green belt or other spaces for the benefit of the community.In the event of any acquisition or development of surrendered land, the owner - dedicator will have the benefit of compensation on account of land ceasing to be âland dedicated to the community purpose of lung/open space.'' when such acquisition/alienation takes place, DDA and the land owner will be entitled to share the compensation at 50% each.â

In view of the aforesaid judgment, benefits earned by DDA from the surrendered land are to be shared equally with the Company.

Pending determination of the benefits amount, the credit thereof for the period from July 17 onwards has not been taken in these financial statements.

10. The Company executed a Business Transfer Agreement on November 18, 2016 with Indian Potash Limited (IPL) to sell off its Agreed Assets and Liabilities excluding contingent liabilities of Titawi Sugar Complex (unit) as a going concern on an âAS IS WHERE IS WHAT IS'' basis by way of a slump sale.The sale is governed by a Business Transfer Agreement (BTA) which stipulates completion of these activities within a certain time frame.

Accordingly, IPL had taken control of the Unit .The accounts for the year ended March 31,2017, reflected comprehensive sale of aforesaid assets/liabilities. The Company had recognised a net gain of Rs. 2347.04 million which had been reflected under exceptional item in the Statement of Profit and Loss for the previous year ended March 31,2017. During the current year, the Company has completed the above transaction of sale of Titawi Sugar Complex (TSC) Unit to IPL.Whilst effecting the final settlement, the Company had to bear an expenditure of Rs. 43.28 millions, thereby reducing the profit from said sale transaction envisaged in previous year. Accordingly, a loss of Rs. 43.28 millions is recognized under exceptional items in the Statement of Profit and Loss for the year ended March 31, 2018.

A sum of Rs. 20.00 million is recoverable from IPL, pending transfer of certain portion of freehold land in the name of IPL.

11. Dues to Micro, Small and Medium Enterprises

Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

12. Earlier, the Company was having four PF Trusts for maintaining Provident Fund for its employees & workers. As per Clause 25 of Employees Provident Funds Scheme, 1952 âa Company reporting loss for three Consecutive Financial Years or erosion in their capital base shall have their exemption withdrawn from the first day of next / succeeding financial year.â The Company was incurring losses from the year 2010-11 to 2012-13 and net worth of the Company was also completely eroded during that period.

In terms of the above, it was obligatory on the Company to have its exemption withdrawn and transfer the PF accumulation balance to Employee Provident Fund Organisation (EPFO), Ministry of Labour, Govt. of India. Company has already transferred PF accumulations of two PF Trusts during the year 2015-16. However, accumulation of remaining PF Trusts i.e. SFFI Employees PF Trust and MSW Employees PF Trust are under transfer. Necessary approval in this respect has already been received from EPFO. These two trusts have been depositing Provident Fund dues with Regional Provident Fund Commissioner (RPFC) from January 2014 and October 2017 respectively. Hence no disclosure as required under Ind AS 19 employee benefits for provident fund trusts has been given.

13. During the year ended March 31, 2018, frauds pertaining to earlier years have been detected in Company''s sugar units at Mawana Sugar Works and Nanglamal Sugar Complex where some employees (who have already left the service of the Company) have embezzled aggregate sum of Rs.29.78 million by forging documents and wrongfully withdrawing payment. FIR has been filed against these persons and necessary legal action in this regard has been initiated to recover the money. No credit for the above amount has been taken in the books, which will be taken once amount is recovered.

14. In view of Allahabad High Court order dated 21.12.2017 for stay on the retrospective operation of orders of UP State Government on reduction in rate of society commission pertaining to earlier years, Company has provided differential amount of Rs. 285.46 million in the accounts during the current year.

Although the Company has received the order of Allahabad High Court before finalizing the last quarter''s results, however, the management was under discussion internally and with various sugar industry expert to get the waiver of above commission but could not get the success so far in the above matter. As a result, the amount has been provided during the current quarter. The major part of said liability was appearing under the contingent liability in last year''s accounts.

15. In view of oversupply of sugar in the country and crash in sugar prices, Government of India issued the notification No. 1(4)/2018-S.P.-1 dated 9th May 2018 with allocating mill-wise Minimum Indicative Export Quota (MIEQ) of 20 lakh tonne for sugar season 2017-18. The Company has been allocated MIEQ of 19088 MT of sugar. Presently the international prices of sugar are much lower than the domestic prices.

Further, it has also issued notification No. 1(5)/2018-S.P.-1 dated 9th May 2018 with the scheme for assistance to sugar mills for payment of cane price dues to farmers against sugar cane crushed during the season 2017-18 @ Rs 5.50/qtl to offset the cost of cane purchased.

As per one of the conditions of the notification, Company may find difficult to get cane subsidy. Without this, the export of sugar is not viable. Otherwise also, the cost of export obligation approximately offset with the amount of cane subsidy available under the scheme, hence Company has not given effect of above notifications in these accounts.

16. The Company at the year-end has an outstanding balance of Rs.150.27 million owed by a customer (Mawana Foods Private Limited), an erstwhile wholly owned subsidiary of the Company, towards supply of sugar . The Company is exploring the possibility for realizing the value of outstanding dues from the said customer in order to bring the level of outstanding amount at normal credit level.

17. The previous financial year ended March 31, 2017 includes the operations of Titawi Sugar Complex (Unit) upto October 31, 2016 after which it has been sold to IPL (refer note 42) . Therefore, the figures of the current financial year are not comparable with the figures of the previous year.

18. The comparative financial information of the Company for the year ended March 31, 2017 and the transition date opening balance sheet as at April 01, 2016 included in these standalone Ind AS financial statements, are based on the previously issued statutory financial statements prepared in accordance with the accounting principles generally accepted in India, including the Companies (Accounting Standards) Rules, 2006 (as amended) specified under Section 133 of the Act, read with the Companies (Accounts) Rules, 2014 audited by the predecessor auditor, as adjusted for the differences in the accounting principles adopted by the Company on transition to the Ind AS, which have been audited by current auditor.

19. First-time adoption of Ind AS

These financial statements, for the year ended March 31, 2018, are the first the Company has prepared in accordance with Ind AS. For periods up to and including the year ended March 31, 2017, the Company prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Previous GAAP). Accordingly, the Company has prepared financial statements which comply with Ind AS applicable for periods ending on March 31, 2018, together with the comparative period data as at and for the year ended March 31, 2017, as described in the summary of significant accounting policies. In preparing these financial statements, the Company''s opening balance sheet was prepared as at April 01, 2016, the Company''s date of transition to Ind AS. This note explains exemptions availed by the Company in restating its Previous GAAP financial statements, including the balance sheet as at April 01, 2016 and the financial statements as at and for the year ended March 31, 2017.

Exemptions applied:

1. Mandatory exemptions:

a) Estimates:

The estimates at April 01, 2016 and at March 31, 2017 are consistent with those made for the same dates in accordance with Previous GAAP (after adjustments to reflect any differences in accounting policies) apart from the following items where application of Previous GAAP did not require estimation:

- Impairment of financial assets based on expected credit loss model

The estimates used by the Company to present these amounts in accordance with Ind AS reflect conditions at April 01, 2016, the date of transition to Ind AS and as of March 31, 2017.

b) Classification and measurement of financial assets: Financial Instruments: (Security deposits received and security deposits paid):

Financial assets like security deposits received and security deposits paid, has been classified and measured at amortised cost on the basis of the facts and circumstances that exist at the date of transition to Ind AS. Since, it is impracticable for the Company to apply retrospectively the effective interest method in Ind AS 109, the fair value of the financial asset or the financial liability at the date of transition to Ind AS by applying amortised cost method, has been considered as the new gross carrying amount of that financial asset or the financial liability at the date of transition to Ind AS.

c) Impairment of financial assets: (Trade receivables and other financial assets)

At the date of transition to Ind AS, the Company has determined that there is no increase in credit risk since the initial recognition of a financial instrument.

d) Government loan at below market rate of interest - Government grant

Ind AS 101 requires a first-time adopter to apply the requirements of Ind AS 109, Financial instruments and Ind AS 20, Accounting for Government Grants and Disclosure of Government Assistance, prospectively to government loans at below market rate of interest obtained after the date of transition to Ind AS. However, Ind AS 101 allows a first time adopter to apply the requirements of Ind AS retrospectively to any government loan originated before the date of transition to Ind AS provided that the information needed to do so had been obtained at the time of initially accounting for that loan. Consequently, if the Company did not, under its previous GAAP, recognise and measure the government loan at below market rate of interest on a basis consistent with Ind AS requirements, it shall use its previous GAAP carrying amount of the loan at the date of transition to Ind AS as the carrying amount of the loan in the opening Ind AS balance sheet. Accordingly, the Company has applied the above requirement prospectively.

2. Optional exemptions :

Ind AS 101 allows first time adopters certain exemptions from the retrospective application of certain requirements under Ind AS. The Company has applied the following exemptions:

a) Deemed cost-Previous GAAP carrying amount: (Property, Plant and Equipment and Intangible)

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for De-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets and investment property covered by Ind AS 40 Investment Properties. Since there is no change in functional currency, the Company has elected to measure all of its property, plant and equipment and intangible assets, as recognised in its previous GAAP financials as deemed cost at the transaction date.

b) Fair value measurement of financial assets or financial liabilities:

First-time adopters may apply Ind AS 109 to day one gain or loss provisions prospectively to transactions occurring on or after the date of transition to Ind AS. Therefore, unless a first-time adopter elects to apply Ind AS 109 retrospectively to day one gain or loss transactions, transactions that occurred prior to the date of transition to Ind AS do not need to be retrospectively restated.

Notes to the reconciliations:

1. Property, plant and equipment (PPE): Finance lease

The Company has taken chlorine cylinders on lease for the purposes of its business requirement at its chemical plant. Under Previous GAAP such lease was classified as a operating lease whereas under Ind AS the same has been classified as finance lease. As a result, PPE was increased by Rs. 22.98 million on transition date. Correspondingly the Company has recognised a lease liability amounting to Rs 26.79 million (Non current borrowings: Rs. 14.16 million and Current financial liability : Rs.12.63 million) on the date of transition. The rent paid for such cylinders has been classified as principal and interest payment. Accordingly there is reduction in rental expense by Rs. 14.81 million with corresponding increase in interest expense amounting to Rs 2.19 million during the year ended March 31, 2017. Depreciation for the year ended March 31, 2017 on such cylinders amounted to Rs 11.44 million.

2. Investments in equity and preference shares

Under Previous GAAP, investment in equity shares of unrelated companies is shown at the cost, whereas under Ind AS, the same are fair valued. Accordingly, investments has been decreased by Rs. 0.01 million on the date of transition. The Company has invested in preference shares of its subsidiary - Siel Industrial Estate Limited aggregating to Rs. 400 million. The cumulative preference shares are mandatorily redeemable at par within 10 years from respective dates of issue and dividend is payable at the rate of 5% p.a. Under previous GAAP, investment in redeemable preference shares has been recognised at cost. Since there is mandatory dividend, it is classified as financial liability from the perspective of the issuer under Ind AS. The liability component is to be recorded at amortised costs and residual portion is recorded as deemed investment by the holder of shares. Interest on liability component is accrued by using Expected Interest Rate method. The investment in preference shares is reduced by Rs. 11.48 million on transition date with an increase in deemed investment by Rs 12.21 million and corresponding increase in retained earnings by Rs 0.72 million. Interest accretion amounts to Rs. 2.29 million during the year ended March 31, 2017.

3. Employee benefits

Under previous GAAP, actuarial gains and losses were recognised in Statement of Profit and Loss. Under Ind AS, the actuarial gains and losses form part of re-measurement of the net benefit liability/asset which is recognised in other comprehensive income. Thus the employee benefit cost for the year ended March 31, 2017 is decreased by Rs. 27.81 million and re-measurement loss on defined benefit plan has been recognized in other comprehensive income.

4. Borrowings

The Company has taken term loans from banks, financial institutions and others. Under previous GAAP , the same is recognised at its transaction value. However, Ind AS requires such financial liabilities to be recognised on initial recognition at its fair value, as adjusted for the transaction cost. Further, interest is to be accredited on the fair value of the loan to reflect passage of time. This led to decrease in loan amount on the date of transition by Rs 1520.78 million (Non current borrowings : Rs. 703.40 million, Non current financial liability : Rs. 669.56 million and Current financial liability : Rs. 147.82 million) with a corresponding increase in equity. Further, loan amount has been increased on account of interest accretion by Rs.157.99 million during the year 2016-17 with a corresponding decrease in statement of profit and loss respectively. Under Ind AS, transaction cost incurred towards origination of borrowings needs to be deducted from the carrying value of borrowings. These costs are recognized in the Statement of Profit and Loss over the tenure of the borrowings as a part of interest expense by applying effective interest rate method. Under previous GAAP, the transaction cost was amortized to the Statement of Profit and Loss over the tenure of the borrowings. This led to decrease in loan amount on the date of transition by Rs. 0.65 million with a corresponding increase in retained earnings, which has been recognised as a finance cost amount to Rs. 0.52 million and Rs. 0.12 million as an exceptional item during the year ended March 31, 2017. The Company had loan outstanding to Edelweiss Asset Reconstruction Company (EARC) and Punjab National Bank (PNB) as on the date of transition. The terms of repayment of the loan were changed during the year ended March 31, 2017. Under Ind AS, debt instrument results in extinguishment of liability where the renegotiated terms are substantially different form the original terms. The renegotiated terms are substantially different where the present value of cash flow under the new terms are and discounted using the original effective interest rate is at least 10% different from the original liability. This resulted loss on extinguishment of EARC loan amounting to Rs 287.60 million and gain on extinguishment of PNB loan amounting to Rs 40.17 million and interest waiver of PNB loan amounting to Rs. 365.14 million had been recognized under exceptional items in the statement of Profit and Loss during the year ended March 31, 2017.

5. Deferred tax assets/Income tax

Indian GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12, âââIncome Taxesââ requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of Ind AS 12, has resulted in recognition of deferred tax on new temporary differences, which was not required under Indian GAAP. In addition, the various transitional adjustments lead to additional temporary differences. According to the accounting policies, the Company has to account for such differences. Tax impact on Deferred tax adjustments are recognized in reserves for opening balance sheet and statement of profit and loss in subsequent years. As a result, the impact on deferred tax asset as on the date of transition is higher by Rs. 2072.05 million with a corresponding impact on retained earnings as on that date. (31 March 2017: reduction in deferred tax asset by Rs. 832.49 million with a corresponding decrease in Statement of Profit and loss).

Further, the Company has created additional provision for minimum alternate tax (including interest of Rs. 3.00 million) of Rs. 139.79 million, which was not made in last year.

6. Presentation of excise duty

Under previous GAAP, revenue from sales of goods was presented net off excise duty under revenue from operations. Whereas, under Ind AS, revenue from sales of goods include excise duty. The corresponding excise duty expense is presented separately on the face of profit & loss. Thus sale of goods under Ind AS has increased by Rs. 768.54 million with a corresponding increase in expense for the year ended March 31, 2017.

7. Commission to indenting and ordering agent

Under previous GAAP, commission to indenting and ordering agent amounting to Rs 22.69 million has been adjusted with revenue . The same has been regrouped as part of other expenses under Ind AS during the year ended March 31, 2017.

8. Other comprehensive income

Under previous GAAP, there was no concept of other comprehensive income. Under Ind AS, specified items of income, expense, gains, or losses are required to be presented in other comprehensive income.

9. Statement of cash flows

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

10. Prior Period Adjustments

Under Ind AS, the adjustments for prior period events needs to be made in the year to which they actually pertains. Therefore REC sale amounting to Rs. 6.25 million, interest received from Punjab State Power Corporation Limited (PSPCL) amounting to Rs. 8.24 million and share of rent received from DMRC (excess recognised in previous year) amounted to Rs. 88.09 million has been taken in the financial statements for the year ended March 31, 2017. Moreover Interest received from PSPCL pertaining to period prior to date of transition amounting to Rs. 10 million has been taken into retained earnings.

11. Molasses storage fund

Under previous GAAP, allocation towards molasses storage fund was charged in statement of profit & loss and shown as liabilities under non current liabilities. Under Ind AS such allocation is treated as appropriation of reserve and to be part of other equity. As a result, other expenses in statement of profit & loss is reduced by Rs. 0.31 million.

Mar 31, 2017

1. (B) The Indian sugar industry, particularly in the State of Uttar Pradesh, had faced difficulties on account of increased sugar cane prices and corresponding lower than expected recovery of sugar from cane, lower sugar prices and consequential under recovery of cost of production in recent times. These factors adversely affected the Company''s operations and financial performance, resulting into eroded net worth, cash losses, mounting cane dues arrears due to which its current liabilities exceeded its current assets and defaults in debt obligations.

The Company got registered with the Board for Industrial and Financial Reconstruction (BIFR) on 10th September

2013 as sick industrial company (in terms of Section 3(1)(o)) under the provisions of Section 15 (1) of the Sick Industrial Companies (Special Provisions), Act, 1985 (SICA). Meanwhile, the Ministry of Finance issued Notifications S.O. 3568 (E ) & S.O. 3569 (E ) dated 25 November, 2016 to the effect that SICA has been repealed with effect from 1 December, 2016 and all the references or inquiry pending before the BIFR shall stand abated. With this Notification BIFR ceased to exist.

Since the previous sugar season, the industry has witnessed a steady increase in sugar prices and improved cane recoveries. This has resulted in the Company generating profits during the last financial period as well as in current year ended March 31, 2017.

The Company has taken the following steps to improve its financial position through a business and financial restructuring as indicated below:

* Executed a Business Transfer Agreement (BTA) on November 18, 2016 with Indian Potash Limited (IPL) to sell off its Agreed Assets and Liabilities excluding contingent liabilities of Titawi Sugar Complex (unit) as a going concern on an âAS IS WHERE IS WHAT IS'' basis by way of a slump sale. Such sale is on certain terms and conditions, part of which have been fulfilled and the rest are under process. The sale is governed by the BTA which stipulates completion of these activities within a certain time frame as mutually agreed between the parties.

Accordingly, IPL has taken control of the unit and these accounts reflect comprehensive sale of aforesaid assets/ liabilities. The Company has recognized a net gain of Rs. 2347.04 million which has been reflected under exceptional item in the Statement of Profit and Loss.

* Effected one time settlement agreements with three lenders, which resulted in the waiver of principal and interest amounting to Rs. 1028.23 million which has been reflected as a gain under exceptional item in the Statement of Profit and Loss.

* Pursuant to the assignment of all rights, titles and interests in the financial assistance granted by two other lenders to the Company with an asset reconstruction company, a major portion of the outstanding debts has been restructured for repayment till 2021.

* The Company has resolved its debt liability with one more lender during the current year by way of one time settlement (OTS). In terms of the settlement, the OTS amount is payable till 30th June, 2018.

The above measures have resulted in positive new worth of the Company as on 31st March 2017.

In view of the above, the Management of the Company is confident that the Company would be in a position to realize its assets and discharge its liabilities successfully in the normal course of its business. Accordingly, these financial statements have been prepared on a going concern basis.

(i) There are no changes in issue, subscribed and fully paid up capital during the year and in the previous period.

(ii) The Company has changed its Authorized Share Capital from 175,000,000 Equity Shares of Rs. 10/- each to 100,000,000 Equity shares of Rs. 10/- each aggregating to Rs.1,000 million and 7,500,000 Preference Shares of Rs. 100/- each aggregating to Rs.750 million in AGM held on 13.06.2016. Each holder of equity shares is entitled to one vote per share except 1,192 equity shares held by Siel Infrastructure & Estate Developers Private Limited, a subsidiary which pursuant to second proviso of section 19(1) of the Companies Act, 2013, has no right to vote at the meetings of the Company. Each holder of equity shares have a right to receive per share dividend declared by the Company. In event of liquidation of the Company, holder of equity shares will be entitled to receive remaining assets of the Company after distribution of all preferential amount. The distribution will be in proportion to the number of equity shares held by the shareholders.

¹ Includes Rs. 991.46 million (previous period Rs. 991.46 million) representing the extinguishment of the debts of erstwhile Mawana Sugars Limited (MSL), which got discharged pursuant to the surplus arising on sale of shares of Shivajimarg Properties Limited.

# a) During the previous period, pursuant to an assignment of all rights, titles and interest in the financial assistance i.e Long term borrowings, Short term borrowing, cash credit and Funded Interest Term Loan granted by two term lenders to the Company with an Asset Reconstruction Company, Rs. 2210 million which was earlier restructured for repayment till 2023 has been rescheduled for repayment till 2021 in the current year*.

b) The Company has resolved its debt liability with one more lender during the current year by way of one time settlement (OTS). In terms of the settlement, the OTS amount is payable till 30th June, 2018*.

* Accordingly such Long term borrowings, Short term borrowings, cash credits and Funded Interest Term Loans which hither to were classified under Long term borrowings, Short term borrowings and other current liabilities have now been reflected under Long term borrowings and Other current liabilities in Note 4 and 9 respectively.

c) Effected one time settlement agreements with three lenders, which resulted in the waiver of principal and interest amounting to Rs. 1028.23 million which has been reflected as a gain under exceptional item in the Statement of Profit and Loss.

A i) Cash credit / overdraft amounting to Nil (previous period Rs. 422.10 million) are secured by first pari-passu charge on the current assets of the Company and third pari-passu charge on the fixed assets of sugar units of the Company. This limit is also secured by second pari-passu charge on the fixed assets of chemical division of the Company. Further, these loans are also secured by corporate guarantee issued by Siel Industrial Estate Limited and equitable mortgage of its industrial estate land measuring 455.23 acres at Rajpura in the state of Punjab and personal guarantee of the former Chairman and Managing Director of the Company.

ii) Cash credit amounting to Nil (previous period Rs. 46.34 million) are secured by first pari-passu charge on the current assets of the Company and fixed assets of chemical division of the Company situated at Rajpura in the state of Punjab.

iii) Refer note 4 (#b)

B The period and amount of continuing default in repayment of borrowings as at the year/period end:

c) The Company has provided bank guarantees aggregating Rs. 72.01 million (Previous period Rs. 72.01 million) to Tecumseh Products India Limited (TPIL), to whom it had sold the compressor business in a previous period, for any loss, damage, claim, action, suit etc., arising from various representations /breach of representations including for contingent liabilities existing as at March 31, 1997, or prior to March 31, 1997, which TPIL may eventually be liable to pay, against which demands in respect of sales tax, income tax and central excise matters aggregating Rs. 43.68 million (Previous period Rs. 43.68 million) have been received. These demands are presently under various stages of appeal.

d) During the previous periods, the Company had given a counter indemnity/guarantee in favour of existing directors of Transiel India Limited to protect their interest against any loss/ future liabilities that may arise after the name of the said subsidiary has been struck off under the Easy Exit Scheme, 2011.

2 Research and development expenses included under relevant heads in the Statement of Profit and Loss amounting to Rs. 6.00 million (previous period Rs. 4.21 million).

3 Accounting for taxes on income:-

In accordance with the Accounting Standard (AS) 22 âAccounting for Taxes on Income'' specified under Section 133 of the Companies Act, 2013,deferred tax assets have been recognized only to the extent of deferred tax liabilities, the details of which are as under:

4 Sales are net of commission of Rs. 21.37 million (previous period Rs. 37.21 million).

@ Rs. 74.75 million (Previous period Rs. 99.92 million) has not been funded

# The plan assets are maintained with Life Insurance Corporation of India (LIC) Gratuity Scheme. The details of investments maintained by LIC are not made available to the Company and therefore has not been disclosed.

5 Segment reporting

A. Business Segment

Based on the guiding principles given in Accounting Standard (AS) 17 âSegment Reportingâ specified under Section 133 of the Companies Act, 2013, the Company''s Business segments include Sugar, Power, Chemical and Distillery.

B. Geographical Segment

C. Segment accounting policies:

In addition to the significant accounting policies applicable to the business segments as set out in note 1(A) above, the accounting policies in relation to segment accounting are as under:

a) Segment revenue and expenses:

Segment revenue and expenses are directly attributable to the segments.

b) Segment assets and liabilities:

c) Inter segment revenues:

Inter segment revenues between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

6 Related party disclosures under Accounting Standard 18

Name of related party and nature of related party relationship

Promoter:

Mr. Siddharth Shriram Subsidiaries:

Siel Financial Services Limited,

Siel Industrial Estate Limited,

Siel Infrastructure & Estate Developers Private Limited Key Management Personnel(KMP):

Mr. Dharam Pal Sharma - Whole Time Director (w.e.f. August 13, 2015)

Dr. Anil Arora - Chief Financial Officer (w.e.f. November 05, 2015)

Mr. Ashok Kumar Shukla - Company Secretary (w.e.f. July 04, 2015)*

Mr. Ritesh Jain - Company Secretary (resigned w.e.f. March 10, 2015)*

Enterprises over which key management personnel/Promoter have significant influence:

Usha International Limited

Mawana Foods Private Limited (Formerly known as Mawana Foods Limited) (subsidiary company of Usha International Limited).

7 Operating lease:

The Company has taken properties on cancellable and non-cancellable operating lease and has recognized rent of Rs. 33.72 Million (Previous period Rs. 52.66 Million) during the year in the Statement of Profit and Loss.

8. i) The Central Government had approved the erstwhile Chairman and Managing Director''s remuneration (w.e.f. October

15, 2012) vide letter dated April 21, 2014 at an amount lower than that approved by the shareholders in their general meeting. Consequent thereto, the Company had made a representation to the Central Government on November 5, 2014 for waiver of excess remuneration paid to Chairman and Managing Director (ceased to be Managing Director w.e.f. July 31, 2014). Pending outcome thereof, refund of excess remuneration amounting to Rs. 7.04 million paid in terms of shareholders'' approval has not been obtained by the Company.

ii) The Central Government had approved the former Whole time Director (WTD) remuneration (w.e.f. February 01, 2014) vide letter dated June 30, 2015 at an amount lower than that approved by the shareholders in their general meeting. Consequent thereto, the Company had made a representation to the Central Government on July 21, 2015 for waiver of excess remuneration paid to the former Whole Time Director (ceased to be WTD w.e.f. December 31, 2014). Pending outcome thereof, refund of excess remuneration amounting to Rs. 6.61 million paid in terms of shareholders'' approval has not been obtained by the Company.

iii) The remuneration amounting to Rs 2.89 million (previous period Rs. 1.08 Million) paid to Whole Time Director (WTD)(w.e.f. August 13, 2015) up to March 31, 2017 is subject to the approval of the Central Government under the provisions of the Companies Act, 2013.

9 During the previous period ended March 31, 2016, pursuant to an Order of Hon''ble High Court of Punjab & Haryana , the Company''s 100% subsidiary viz. Siel Industrial Estate Limited (Siel IE) was ordered to pay additional compensation to the farmers from whom the Land had been acquired. Having regard to the fact that Siel IE has no business activity/ income of its own, the Company paid Rs. 40.00 million to Siel IE by way of subscription to the Right Issue of 4,000,000 5 % Redeemable Cumulative Preference Shares of Rs 10 each fully paid.

10 In the previous period ended March 31, 2016, pursuant to Companies Act, 2013 (âthe Act'') being effective from January 1, 2015, the company had revised depreciation rates on fixed assets as per the useful life specified in Part âC'' of schedule II of the Act. As a result of this change, the depreciation charged for the period ended March 31, 2016 was lower by Rs. 243.53 Million. In respect of the assets whose useful life was already exhausted as at December 31, 2014, depreciation of Rs. 49.13 million had been adjusted in the Statement of Profit and Loss for the period ended March 31, 2016 in accordance with the requirement of the Schedule II of the Act.

11 Pursuant to judgment dated 10.5.1996 passed by the Hon''ble Supreme Court of India in a public interest litigation the Company surrendered 46.58 acres of land to the Delhi Development Authority (âDDA'') and dedicated it exclusively for the development of green belt and open spaces. Consequently, the Company is no longer in physical possession of 46.58 acres owned by it.

Although the Hon''ble Supreme Court of India dismissed the aforesaid Review Petition by order dated 25.3.2010 but on the Company''s application against the leasing of land by DDA to DMRC stated and directed as follows : â...the DDA which holds the surrendered and dedicated land in Trust cannot use it for any purpose other than as green belt or other spaces for the benefit of the community. In the event of any acquisition or development of surrendered land, the owner - dedicator will have the benefit of compensation on account of land ceasing to be âland dedicated to the community purpose of lung/open space.'' when such acquisition/alienation takes place, DDA and the land owner will be entitled to share the compensation at 50% each.â

In view of the aforesaid judgment, benefits earned by DDA from the surrendered land are to be shared equally with the Company.

12 In the previous period ended March 31, 2016, the Government of Uttar Pradesh had announced subsidy on sugar cane purchased during the sugar season 2014-15 linked to average selling price of sugar and its by-products during the period 1st October, 2014 to 31st May, 2015. As such, the Company had recognized the full subsidy of Rs. 28.60 per qtl. aggregating to Rs. 766.2 million which has been netted off from the cost of material consumed for period ended March 31, 2016.

13 The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

14 There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company

15 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

On the basis of supplier information available with the Company who have registered under the Micro Small and Medium Enterprise Development Act, 2006 (MSMED Act, 2006), the following are the details.

Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors.

16 Consequent upon restructuring of debts of the Company, a part of the principal amount of the term loan amounting to Rs

640.78 million, that was availed in the past for acquisition of capital assets, has been written back and credited as an exceptional item in the Statement of Profit and Loss of the Company for the year. Based upon decision of Income Tax Appellate Tribunal in respect of such matter rendered in another case and legal opinions obtained from expert tax consultants, this amount is treated as capital receipt and not included in book profit for the purposes of calculation of tax under section 115 JB of the Income Tax Act 1961.

The statutory auditors have expressed qualification in respect of the matter referred to in Note 48 above.

17 Previous period''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosures.

18 The current financial year is for a period of 12 months and includes the operations of Titawi Sugar Complex (Unit) up to October 31, 2016 after which it has been sold to Indian Potash Limited (refer note 1(B)) whereas the previous financial period is for 15 months and includes the operations of Titawi Sugar Complex (Unit) for the full period. As such, the figures of the current financial year are not comparable with the figures of the previous period.

''Includes 49.29% (Previous year 49.29%) held by Siel Infrastructure & Estate Developers Private Limited. (SIEL-IED), a wholly owned subsidiary.

Dec 31, 2014

1. The Company over the last few years has been incurring cash losses due to which its net worth has been completely eroded and its current liabilities are far in excess of its current assets. The Indian sugar industry, particularly in the State of Uttar Pradesh, has faced difficulties on account of increasing sugar cane prices and corresponding lower than expected recovery of sugar from cane, lower sugar prices and consequential under recovery of cost of production. These factors have adversely affected the Company''s operations and financial performance. Higher finance costs have also added to the cash losses.

The Company got registered with the BIFR on 10th September 2013 under the provisions of Section 15(1) of the Sick Industrial Companies (Special Provisions), Act, 1985 (SICA). The process for revival/rehabilitation of the Company is under way in line with the prescribed procedure and rules under SICA.

The State and Central Government have initiated various steps to support the sugar industry like decontrol of free sale of sugar release mechanism, doing away with levy quota system and also considering linking the sugar cane price with sugar price. All the aforesaid measures are expected to support the industry and also the operations of the Company in the near future. The Company has also initiated various steps including cane developement activities, enhancing plant efficiencies, costs reduction etc. to improve the performance of the Company.

As such, the Company is confident that BIFR will approve a rehabilitation scheme which would entail part sale of its surplus/non-core assets to discharge some of its financial obligations and improve cash flow, reschedulement of the outstanding debt/payables (including overdue debt/payables), and other requisite financial restructuring in consultation with various stakeholders to improve its financial position including net worth. Based on an internal assessment and valuation done by an independent valuer, the Management is confident that the current fair market value of the aforesaid assets it proposes to dispose as part of the rehabilitation scheme would be sufficient to discharge its financial obligations as envisaged in the scheme.

In view of the above, the Board of Directors of the Company is confident that the Company would be in a position to realize its assets and discharge its liabilities by successfully implementing the rehabilitation scheme and in the normal course of its business. Accordingly, these financial statements have been prepared on a going concern basis."

(i) The Company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share except 1,192 equity shares held by Siel Infrastructure & Estate Developers Private Limited, a subsidiary which pursuant to second provision of section 19(1) of the Companies Act, 2013, has no right to vote at meeting of the Company. Each holder of equity shares have a right to receive per share dividend declared by the Company. In event of liquidation of the Company, holder of equity shares will be entitled to receive remaining assets of the Company after distribution of all preferential amount. The distribution will be in proportion to the number of equity shares held by the shareholders.

1. Cash credit / overdraft amounting to Rs. 1909.97 million (previous year Rs. 2006.75 million) are secured by first pari- passu charge on the current assets of the Company and third pari-passu charge on the fixed assets of sugar units of the Company. This limit is also secured by second pari-passu charge on the fixed assets of chemical division of the Company. Further, these loans are also secured by corporate guarantee issued by Siel Industrial Estate Limited and equitable mortgage of its industrial estate land measuring 455.23 acres at Rajpura in the state of Punjab and personal guarantee of the erstwhile Chairman and Managing Director of the Company.

2. Cash credit amounting to Rs. 51.35 (previous year Rs. 84.68 million) are secured by first pari-passu charge on the current assets of the Company and fixed assets of chemical division of the Company situated at Rajpura in the state of Punjab.

3. Cash credit / overdraft amounting to Rs. Nil (previous year Rs. 1627.13 million) are secured by pledge of sugar stocks with U.P. Co-operative Bank and District Co-operative Banks in the State of Uttar Pradesh.

4. The Company has provided bank guarantees aggregating Rs. 72.01 million (Previous year Rs. 78.18 million) to Tecumseh Products India Limited (TPIL), to whom it had sold the compressor business in a previous year, for any loss, damage, claim, action, suit etc., arising from various representations /breach of representations including for contingent liabilities existing as at March 31, 1997, or prior to March 31, 1997, which TPIL may eventually be liable to pay, against which demands in respect of sales tax, income tax and central excise matters aggregating Rs. 43.68 million (Previous year Rs. 44.53 million) have been received. These demands are presently under various stages of appeal.

5. During a previous period, the Company had given a counter indemnity/guarantee in favour of existing directors of Transiel India Limited to protect their interest against any loss/ future liabilities that may arise after the name of the said subsidiary has been struck off under the Easy Exit Scheme, 2011.

I. Research and development expenses included under relevant heads in the Statement of Profit and Loss amounting to Rs. 4.09 million (previous year Rs. 2.99 million).

II. Accounting for taxes on income:-

In accordance with the Accounting Standard (AS) 22 ''Accounting for Taxes on Income'' notified in the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the ("the 1956 Act") (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 ("the 2013 Act") read with rule 7 of the Companies (Accounts) Rules, 2014) deferred tax assets and liabilities have been recognized on the basis of projections after considering unabsorbed depreciation and timing differences which will be reversed against future taxes in accordance with AS-22. Accordingly, deferred tax assets have been recognized only to the extent of deferred tax liability, the details of which are as under:

III. Sales are net of commission of Rs. 29.30 million (previous year Rs. 36.60 million).

IV. Employee Benefits:

Disclosures required under Accounting Standard (AS) - 15 "Employees Benefits" notified in the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the ("the 1956 Act") (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 ("the 2013 Act") read with rule 7 of the Companies (Accounts) rules, 2014):

V. Segment reporting

A. Business Segment

Based on the guiding principles given in Accounting Standard (AS) 17 "Segment Reporting" notified in the Companies (Accounting Standards) Rules, 2006 (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 read with rule 7 of Companies (Accounts) rules, 2014), - the Company''s business Segment includes Sugar, Power, Chemical and Distillery.

B. Geographical Segment

Since the Company''s activities/operations are primarily within the country and considering the nature of products/ services it deals in, the risk and returns are same and as such there is only one geographical segment.

C. Segment accounting policies:

In addition to the significant accounting policies applicable to the business segments as set out in note 1(A) above, the accounting policies in relation to segment accounting are as under:

a) Segment revenue and expenses:

Segment revenue and expenses are directly attributable to the segments.

b) Segment assets and liabilities:

Segment assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fixed assets, net of allowances and provisions which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities.

c) Inter segment revenues:

Inter segment revenues between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

VI. Related party disclosures under Accounting Standard 18 Name of related party and nature of related party relationship

Promoter:

Mr. Siddharth Shriram- (Chairman and Managing Director Upto July 31,2014)

Subsidiaries:

Siel Financial Services Limited,

Siel Industrial Estate Limited,

Siel Infrastructure & Estate Developers Private Limited Key Management Personnel:

Mr. Siddharth Shriram - Chairman and Managing Director (resigned w.e.f. August 01,2014)

Mr. Rajendra Khanna - Whole Time Director (resigned w.e.f. December 31,2014)

Mr. A. K. Mehra - Whole Time Director (resigned w.e.f. July 31,2014)

Mr. Sunil Kakria - Managing Director (resigned w.e.f. August 01,2013)

Enterprises over which key management personnel have significant influence:

Usha International Limited (holding company upto June 20, 2013)

Mawana Foods Private Limited (Formerly known as Mawana Foods Limited) (subsidiary company upto June 28, 2013) Details of Related Party Transactions:

VI. In the previous year, prior period adjustment represents elimination of profit from the value of the investments held by the Company in Siel Infrastructure and Estate Developers Private Limited to give effect to the Statutory Auditor''s qualification on the Company''s financial statements for the period ended September 30, 2012.

VII. In the previous year, exceptional items represent profit on sale of investment in Mawana Foods Private Limited (MFPL) (Formerly known as Mawana Foods Limited) and Ceratizit India Private Limited (CIPL) of Rs. 50.10 million and Rs. 137.36 million respectively.

VIII. The Central Government had approved the Chairman and Managing Director remuneration (w.e.f. October 15, 2012) vide letter dated April 21,2014 at an amount lower than that approved by the shareholders in their general meeting. Consequent thereto, the Company had made a representation to the Central Government on November 5, 2014 for waiver of excess remuneration paid to Chairman & Managing Director (cease to be managing director w.e.f. August 01, 2014). Pending outcome thereof, refund of excess remuneration amounting to Rs. 70.40 lacs paid in terms of shareholders approval has not been obtained by the Company.

IX. Pursuant to judgment dated 10.5.1996 passed by the Hon''ble Supreme Court of India in a public interest litigation the Company surrendered 46.58 acres of land to the Delhi Development Authority (''DDA'') and dedicated it exclusively for the development of green belt and open spaces. Consequently, the Company is no longer in physical possession of 46.58 acres owned by it.

The Company had filed a Review Petition in the Hon''ble Supreme Court of India challenging the order of surrender of land to the DDA. During the pendency of this Review Petition, the DDA leased out some portion of the land surrendered by the Company to Delhi Metro Rail Corporation (''DMRC''). The Company filed an application before the Hon''ble Supreme Court of India in the pending Review Petition against the leasing of land by DDA to DMRC as this was contrary to the purpose for which the Company has surrendered and dedicated the land.

Although the Hon''ble Supreme Court of India dismissed the aforesaid Review Petition by order dated 25.3.2010 but on the Company''s application against the leasing of land by DDA to DMRC stated and directed as follows : "...the DDA which holds the surrendered and dedicated land in Trust cannot use it for any purpose other than as green belt or other spaces for the benefit of the community.In the event of any acquisition or development of surrendered land, the owner - dedicator will have the benefit of compensation on account of land ceasing to be ''land dedicated to the community purpose of lung/ open space.'' when such acquisition/alienation takes place, DDA and the land owner will be entitled to share the compensation at 50% each."

In view of the aforesaid judgment, benefits earned by DDA from the surrendered land are to be shared equally with the Company.

X. The current financial year is for a period of fifteen months from October 01, 2013 to December 31, 2014 whereas the corresponding previous year figures were for a period of twelve months from October 01,2012 to September 30, 2013. Therefore, the corresponding figures of previous year are not directly comparable with those of current period.

XI. Previous period''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosures.

Sep 30, 2013

1. Pursuant to the Scheme of Arrangement for Amalgamation (the "Scheme") of the erstwhile Mawana Sugars Limited (MSL) with the Company under Sections 391 to 394 of the Companies Act, 1956 approved by the Hon''ble High Court of Delhi vide its Order dated September 11, 2007 which became effective on October 15, 2007 on fling of the certifed copy of the Order of the High Court in the Offce of Registrar of Companies, NCT Delhi & Haryana, all the properties, assets, both movable and immovable, liabilities including contingent liabilities and reserves of erstwhile MSL have without further act or deed, been transferred to and vested in the Company at their book values, as a going concern with effect from the appointed date i.e. October 1, 2006. Subsequently, the name of the Company has been changed to Mawana Sugars Limited w.e.f. January 4, 2008.

2. Contingent liabilities:

a) Claims against the Company not acknowledged as debt in respect of:

- Income tax 336.70 336.70

- Sales tax 81.03 80.98

- Excise Duty/Service tax 221.69 176.55

- Others 357.74 235.48

*All the above matters are subject to legal proceedings in the ordinary course of business. The legal proceedings, when ultimately concluded, in the opinion of the management, will not have a material effect on the results of the operations or fnancial position of the Company.

b) Guarantee given to bank for repayment of fnancial facilities 70.00 70.00 provided to Mawana Foods Limited

Dues outstanding 33.61 34.51

c) The Company has provided bank guarantees aggregating Rs. 78.18 million (Previous period Rs. 78.18 million) to Tecumseh Products India Limited (TPIL), to whom it had sold the compressor business in a previous year, for any loss, damage, claim, action, suit etc., arising from various representations /breach of representations including for contingent liabilities existing as at March 31, 1997, or prior to March 31, 1997, which TPIL may eventually be liable to pay, against which demands in respect of sales tax, income tax and central excise matters aggregating Rs. 44.53 million (Previous period Rs. 44.53 million) have been received. These demands are presently under various stages of appeal.

d) During a previous period, the Company had given a counter indemnity/guarantee in favour of existing directors of Transiel India Limited to protect their interest against any loss/ future liabilities that may arise after the name of the said subsidiary has been struck off under the Easy Exit Scheme, 2011.

3. Research and development expenses included under relevant heads in the Statement of Proft and Loss amounting to Rs. 2.99 million (previous period Rs. 3.44 million).

4. Accounting for taxes on income:- In accordance with the Accounting Standard (AS) 22 ''Accounting for Taxes on Income'' notifed in the Companies (Accounting Standards) Rules, 2006, deferred tax assets and liabilities have been recognized on the basis of projections after considering unabsorbed depreciation and timing differences which will be reversed against future taxes in accordance with AS-22. Accordingly, deferred tax assets have been recognized only to the extent of deferred tax liability, the details of which are as under:

5. Sales are net of commission of Rs. 36.60 million (previous period Rs. 39.54 million).

6. The Company had imported plant and machinery in previous years under EPCG scheme. An export obligation (''EO'') amounting to USD 91.68 million was placed on the Company which was to be fulflled in a period of 8 years starting from April 1997. Subsequently, the said EO was refxed at USD 73.74 million and the EO period was extended to 30.03.2007 in terms of the Foreign Trade Policy Handbook of procedure (HBP) 2002-2007.

By letter dated May 4, 2011 the DGFT had extended the EO period by 765 days w.e.f. April 19, 2011.

The Company has fulflled the entire EO. The application for redemption of EPCG license was fled and had been redeemed by the licensing authority.

7. Employee Benefts:

Disclosures required under Accounting Standard (AS) - 15 "Employees Benefts" notifed in the Companies (Accounting Standards) Rules, 2006 (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs), are as under:

i) Defned Contribution Plan and amount recognized in the Statement of Proft and Loss.

8. Segment reporting

A. Business Segment

Based on the guiding principles given in Accounting Standard (AS) 17 "Segment Reporting" notifed in the Companies (Accounting Standards) Rules, 2006 (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs), - the Company''s business Segment includes Sugar, Power, Chemical and Distillery.

B. Geographical Segment

Since the Company''s activities/operations are primarily within the country and considering the nature of products/ services it deals in, the risk and returns are same and as such there is only one geographical segment.

C. Segment accounting policies:

In addition to the signifcant accounting policies applicable to the business segments as set out in note 1 above, the accounting policies in relation to segment accounting are as under:

a) Segment revenue and expenses:

Segment revenue and expenses are directly attributable to the segments.

b) Segment assets and liabilities:

Segment assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fxed assets, net of allowances and provisions which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities.

c) Inter segment revenues:

Inter segment revenues between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

9. There are various issues relating to sales tax, income tax etc. arisen / arising out of the reorganisation arrangement of DCM Limited which will be settled and accounted for in terms of the Scheme of Arrangement of DCM Limited and memorandum of understanding between all the companies involved as and when the liabilities/benefts are fully determined.

In the opinion of the management, having regard to the current status of the assessment proceedings at various stages and since no demand has been received by the Company on this account, the effect of these matters on the fnancial statements, though not determinable at this stage, are not expected to be signifcant.

10. Related party disclosures under Accounting Standard 18

Name of related party and nature of related party relationship

Subsidiaries:

Siel Financial Services Limited,

Siel Industrial Estate Limited,

Siel Infrastructure & Estate Developers Private Limited (Formerly known as Avro Sales Private Limited) (w.e.f. September

13, 2012)

Key Management Personnel:

Mr. Siddharth Shriram Â Chairman and Managing Director

Mr. K.P. Singh Â Whole Time Director (deceased on April 20, 2011)

Mr. A. K. Mehra Â Whole Time Director

Mr. Sunil Kakria Â Managing Director (resigned w.e.f. August 1, 2013)

Enterprises over which key management personnel have signifcant infuence:

Usha International Limited (holding company upto June 20, 2013) Mawana Foods Limited (subsidiary company upto June 28, 2013)

11. The Company has facilitated Agri loans from Punjab National Bank (Bank) to the farmers who supply sugarcane to the Company. These loans were distributed to the farmers through an Escrow Account operated by the Company. The Company has facilitated repayment of loans by the farmers to the Bank against the payments to be made to them against supply of sugarcane to the Company. A sum of Rs. Nil and Rs. 57.54 million has been lying in Escrow Account as on September 30, 2013 and September 30, 2012 respectively.

12. (a) The Company had in an earlier year accounted for cane purchases for crushing season 2007-08 at a price of Rs. 110 per quintal in terms of the interim order passed by the Hon''ble Supreme Court as against the State Advised Price of Rs. 125 per quintal. Pursuant to Hon''ble Supreme Court''s order dated January 17, 2012 the differential cane liabilities of Rs. 465.53 million has been accounted for during the previous period as an exceptional item and the same have been paid on April 16, 2012.

(b)(i) A Memorandum of Understanding (MOU) was signed between the Company and Government of Punjab in 1993 for setting up an Industrial Estate in Punjab. Siel Industrial Estate Limited (Siel Â IE) was incorporated in an earlier year as a wholly owned subsidiary of the Company for setting up the Industrial Estate. The clear and un-encumbered title and possession of the land for the aforesaid Industrial Estate came to Siel IE in October, 2011 and now Siel Â IE holds approximately 455 acres of land at Rajpura, Punjab.

The Company, Siel - IE and Siel Infrastructure and Estate Developers Private Limited (Siel - IED), which was acquired, and consequently, became a wholly owned subsidiary of the Company during the fnancial year 2011-12, had entered into a Joint Development Agreement for the development of the Industrial Estate. During the fnancial year 2011-12, the Company had sold 13,475,000 equity shares of Rs. 10/- each of Siel Â IE to Siel - IED for a consideration aggregating to Rs. 1350.20 million, as determined through an independent valuation of Siel Â IE. The consideration was received by the Company in the form of 13,501,950 equity shares of Rs. 100/- each fully paid up of Siel - IED. Accordingly, the Company had recognized a proft of Rs. 1215.45 million in the Statement of Proft and Loss as an exceptional item. In the Auditors'' report on the Company''s fnancial statements for the period ended September 30, 2012, the Auditors'' had qualifed their report regarding the recognition of a proft of Rs. 1215.45 million by the Company on the non-monetary transfer of shares held in Siel - IE on the grounds that the proft represents surplus arising out of recognition of the fair value of Siel Â IE shares exchanged for the additional shares acquired in Siel - IED without dilution in the Company''s control over Siel Â IE, as both entities were under common control of the Company.

During the current year ended September 30, 2013, in order to give effect to the Statutory Auditors'' qualifcation as stated above, the proft of Rs. 1215.45 million has been eliminated from the value of the investments held by the Company in Siel-IED and the corresponding loss of Rs. 1215.45 million has been charged as a prior period adjustment in the Statement of Proft and Loss.

(b)(ii) During the current year the Company has sold 31,30,000 equity shares of Rs. 10/- fully paid up (65.03% of paid up capital) held by it in Mawana Foods Limited (MFL), a subsidiary of the Company at a price of Rs. 26.12 per share to Usha International Limited (UIL) for a total consideration of Rs. 81.76 million. Consequently, MFL ceased to be subsidiary of the Company w.e.f. June 29, 2013 and the Company has recognized a proft of Rs. 50.46 million. The Company has also sold its entire investments in Ceratizit India Private Limited (CIPL) i.e. 2,300,000 equity shares of Rs. 5 /- each for a total consideration of Rs. 160 million and the Company has recognised a proft of Rs.137.00 million.

13. The Company had been legally advised that the "Capital reserve" to the extent of Rs. 991.46 million, as depicted under Note 3 - Reserves and Surplus, pertaining to the profts earned by formerly Siel Limited from sale of shares of Shivajimarg Properties Limited during the year ended March 31, 2006 which formed part of capital reserve in the books of account of the erstwhile Mawana Sugars Limited and subsequently, became a part of capital reserve in the books of the Company, pursuant to merger of erstwhile Mawana Sugars Limited with the Company, is to be considered as part of "free reserves" for the purposes of computing "net worth" under the provisions of Sick Industrial Companies (Special Provisions) Act, 1985 ("SICA ").

14. Pursuant to judgment dated 10.5.1996 passed by the Hon''ble Supreme Court of India in a public interest litigation the Company surrendered 46.58 acres of land to the Delhi Development Authority (''DDA'') and dedicated it exclusively for the development of green belt and open spaces. Consequently, the Company is no longer in physical possession of 46.58 acres owned by it.

The Company had fled a Review Petition in the Hon''ble Supreme Court of India challenging the order of surrender of land to the DDA. During the pendency of this Review Petition, the DDA leased out some portion of the land surrendered by the Company to Delhi Metro Rail Corporation (''DMRC''). The Company fled an application before the Hon''ble Supreme Court of India in the pending Review Petition against the leasing of land by DDA to DMRC as this was contrary to the purpose for which the Company has surrendered and dedicated the land.

Although the Hon''ble Supreme Court of India dismissed the aforesaid Review Petition by order dated 25.3.2010 but on the Company''s application against the leasing of land by DDA to DMRC stated and directed as follows : "Âthe DDA which holds the surrendered and dedicated land in Trust cannot use it for any purpose other than as green belt or other spaces for the beneft of the communityÂIn the event of any acquisition or development of surrendered land, the owner Â dedicator will have the beneft of compensation on account of land ceasing to be ''land dedicated to the community purpose of lung/open spaceÂ'' when such acquisition/ alienation takes place, DDA and the land owner will be entitled to share the compensation at 50% each."

In view of the aforesaid judgment, benefts earned by DDA from the surrendered land are to be shared equally with the Company.

15. During the year ended on September 30, 2013, there has been an inter-se transfer of equity shares, wherein Usha International Limited (UIL) has transferred 2,59,77,735 equity shares of Rs. 10 each (66.41% of the paid up capital) at a price of Rs. 10 per share to Mr. Siddharth Shriram, promoter of the Company. Consequently the Company ceased to be the subsidiary of UIL w.e.f. June 20, 2013.

The Board of Directors in its meeting held on August 13, 2013 has taken cognizance that UIL ceased to be a Promoter of the Company.

16. The current fnancial year is for a period of twelve months from October 01, 2012 to September 30, 2013 whereas the corresponding previous period fgures were for a period of eighteen months from April 01, 2011 to September 30, 2012.

Therefore, the corresponding fgures of previous period are not directly comparable with those of current year.

17. Previous period''s fgures have been regrouped / reclassifed wherever necessary to correspond with the current year''s classifcation / disclosures.

Mar 31, 2011

1. Pursuant to the Scheme of Arrangement for Amalgamation (the "Scheme") of the erstwhile Mawana Sugars Limited (MSL) with the Company under Sections 391 to 394 of the Companies Act, 1956 approved by the Hon'ble High Court of Delhi vide its Order dated September 11,2007 which became effective on October 15, 2007 on filing of the certified copy of the Order of the High Court in the Office of Registrar of Companies, NCT Delhi & Haryana, all the properties, assets, both movable and immovable, liabilities including contingent liabilities and reserves of erstwhile MSL have without further act or deed, been transferred to and vested in the Company at their book values, as a going concern with effect from the appointed date i.e. October 1, 2006. Subsequently, the name of the Company has been changed to Mawana Sugars Limited w.e.f. January 4,2008.

2. Contingent liabilities: (Rs. in million) As at As at March 31,2011 September 30, 2009

a) Claims against the Company not acknowledged as debts in respect of*:- - Income Tax 629.22 149.40

- Sales Tax 78.24 81.04

- Excise Duty/ Service Tax 99.01 64.88

License fee for railway siding - 60.68

- Others 69.27 70.84

*AII the above matters are subject to legal proceedings in the ordinary course of business. The legal proceedings, when ultimately concluded will not. in the opinion of the management, have a material effect on the results of the operations or financial position of the Companv.

c) The Company has provided bank guarantees aggregating Rs. 78.18 million (Previous year Rs. 78.18 million) to Tecumseh Products India Limited (TPIL), to whom it had sold the compressor business in a previous year, for any loss, damage, claim, action, suit etc., arising from various representations /breach of representations including for contingent liabilities existing as at March 31,1997, or prior to March 31,1997, which TPIL may eventually be liable to pay, against which demands in respect of sales tax, income tax and central excise matters aggregating Rs. 52.32 million (Previous year Rs. 52.32 million) have been received. These demands are presently under various stages of appeal.

d) During the period, the Company has given a counter indemnity/guarantee in favour of existing directors of Transiel India Limited to protect their interest against any loss/ future liabilities that may arise after the name of the said subsidiary has been struck off under the Easy Exit Scheme, 2011.

3. The Company had contracted for import of 60000 MT of Raw Sugar. Due to adverse international and domestic market conditions and resultant falling prices, the Company has exited from these contracts in July, 2010 incurring a loss of Rs. 223.82 million (previous year Rs. NIL).

4. Research and development expenses amounting to Rs. 11.57 million (previous year Rs. 14.22 million) have been charged to the respective revenue accounts.

5. Sales are net of commission of Rs. 48.12 million (previous year Rs. 31.90 million).

6. The Company had imported plant and machinery in previous years under EPCG Scheme. An export obligation ('EO') amounting to USD 91.68 million was placed on the Company which was to be fulfilled in a period of 8 years starting from April 1997. Subsequently, the said EO was refixed at USD 73.74 million and the EO period was extended to 30.3.2007 in terms of the Foreign Trade Policy Handbook of Procedure (HBP) 2002-2007. The balance unfulfilled EO as at March 31,2011 is USD 7.84 million. The said EO period was further extended upto 30.3.2009 on payment of 50% duty payable in proportionate to unfulfilled export obligation amounting to Rs. 16.68 million and the EPCG License has been duly endorsed by Director General of foreign Trade (DGFT) extending the EO fulfillment period upto 30.3.2009.

To fulfill the remaining EO, the Company applied to obtain a release order from Directorate of Sugar to export sugar. Directorate of Sugar vide its letter dated 20.3.2009 has informed the Company that it is not possible to issue release orders for export of sugar and the request of the Company will be considered when the sugar situation improves in the country.

By letter dated 29.9.2009 the DGFT has informed the Company that having regard to the provision of Public Notice No.26 dated 3.6.2008 the extension in export obligation period equivalent to the duration of ban is automatic without composition fee in respect of EPCG authorization issued prior to imposition of ban on such product.

By letter dated May 5,2011 the DGFT has extended the EO period 765 days w.e.f. April 19,2011.

Subsequent to March 31,2011, the Company has received the release orders for export of 5922.5 MT sugar on April 26,2011.

The Company is in process of export of sugar to meet the unfulfilled export obligation.

7. Directors' Remuneration *

The Company has sought approval of the Central Government for excess remuneration paid to the Managing Director/ Whole Time Director amounting to Rs. 6.72 million which had been declined by the Central Government.

Pursuant thereto, the Company has made a fresh application seeking approval of the Central Government for the aforesaid remuneration and additional remuneration amounting to Rs. 6.72 million and Rs. 3.42 million respectively. Pending approvals of the Central Government, the excess remuneration paid has been shown under Schedule 6 - Loans and Advances.

Further Rs. 3.42 million is also subject to approval of the shareholders in the general meeting.

8. Segment reporting

A. Business Segment

Based on the guiding principles given in Accounting Standard (AS) 17 "Segment Reporting" notified in the Companies (Accounting Standards) Rules, 2006, - the Company's business Segment includes Sugar, Power, Chemical and Other (Distillery).

B. Geographical Segment

Since the Company's activities/operations are primarily within the country and considering the nature of products/services it deals in, the risk and returns are same and as such there is only one geographical segment.

C. Segment accounting policies:

In addition to the significant accounting policies applicable to the business segments as set out in note 1 above, the accounting policies in relation to segment accounting are as under:

a) Segment revenue and expenses: Segment revenue and expenses are directly attributable to the segments.

b) Segment assets and liabilities: Segment assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fixed assets, net of allowances and provisions which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities.

c) Inter segment revenues: Inter segment revenues between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

9. Based on the information available with the Company, the principle amount and interest due to Micro and Small Enterprise as defined under "The Micro, Small and Medium Enterprises Development Act, 2006 (Act) is Rs. 3.68 million (previous year Rs. 2.20 million) and Rs. 0.27 million (previous year Rs. 0.27) respectively.

10. There are various issues relating to sales tax, income tax etc. arisen / arising out of the reorganisation arrangement of DCM Limited which will be settled and accounted for in terms of the Scheme of Arrangement of DCM Limited and memorandum of understanding between all the companies involved as and when the liabilities/benefits are fully determined.

In the opinion of the management, having regard to the current status of the assessment proceedings at various stages the effect of these matters on the accounts could not be determined at this stage.

11. Related party disclosures under Accounting Standard 18 Name of related party and nature of related party relationship

Holding Company:

Usha International Limited w.e.f. July 26,2010 (Enterprises over which key management personnel have significant influence up to July 25, 2010)

Subsidiaries:

Siel Financial Services Limited, Transiel India Limited (up to January 27,2011), Siel Industrial Estate Limited, Siel Edible Oils Limited, SFSL Investments Limited (up to January 31,2011)

Key Management Personnel:

Mr. Siddharth Shriram - Chairman and Managing Director Mr. K.P. Singh - Whole Time Director (deceased on April 20,2011) Mr. A. K. Mehra - Whole Time Director Mr. Sunil Kakria - Managing Director

12. The accounts for the period ended March 31,2011 have been prepared after considering sugar cane purchase price @ Rs. 110 per quintal as an interim measure for paying the price of sugar cane to sugar cane grower in accordance with the Order of Hon'ble Supreme Court dated September 8,2008 in case No. 18681 of 2008 for sugar season 2007-08 filed by the Company. Necessary adjustments will be made by the Company in accordance with the final order of the Hon'ble Court in this matter.

13. The current financial period is for a period of eighteen months from October 1,2009 to March 31,2011 whereas the corresponding previous year figures are for a period of twelve months from October 1,2008 to September 30,2009.

Therefore, the corresponding figures of previous year are not directly comparable with those of current period.

14. The Company has facilitated Agri loans from Punjab National Bank (Bank) to the farmers who supply sugarcane to the Company. These loans were distributed to the farmers through an Escrow Account operated by the Company. The Company had facilitated repayment of loans by the farmers to the Bank against the payments to be made to them against supply of sugarcane to the Company. A sum of Rs. Nil and Rs. 1.04 million has been lying in Escrow Account as on March 31,2011 and September 30, 2009 respectively.

15. The Company has been legally advised that the "capital reserve" to the extent of Rs. 991.46 million, as depicted under Schedule 2- Reserve and Surplus, pertaining to the profits earned by formerly Siel Limited from sale of shares of Shivajimarg Properties Limited during the year ended 31st March, 2006, which formed part of capital reserve in the books of the erstwhile Mawana Sugars Limited and subsequently, became a part of capital reserve in the books of the Company, pursuant to merger of erstwhile Mawana Sugars Limited with the Company, is to be considered as part of "free reserves" for the purposes of computing "net worth" under the provisions of Sick Industrial Companies (Special Provisions) Act, 1985 ("SICA").

16. Previous year figures have been regrouped wherever necessary.

Sep 30, 2009

1. Pursuant to the Scheme of Arrangement for Amalgamation (the "Scheme") of the erstwhile Mawana Sugars Limited (MSL) with the Company under Sections 391 to 394 of the Companies Act, 1956 approved by the Honble High Court of Delhi vide its Order dated September 11,2007 which became effective on October 15, 2007 on filing of the certified copy of the Order of the High Court in the Office of Registrar of Companies, NCT Delhi & Haryana, all the properties, assets, both movable and immovable, liabilities including contingent liabilities and reserves of erstwhile MSL have without further act or deed, been transferred to and vested in the Company at their book values, as a going concern with effect from the appointed date i.e. October 1, 2006. Subsequently, the name of the Company has been changed to Mawana Sugars Limited w.e.f. January 4, 2008.

For giving effect to the amalgamation in the nature of merger the pooling of interests method as prescribed by the Accounting Standard -14 "Accounting for amalgamations" notified in the Companies (Accounting Standards) Rules, 2006, was followed in the previous period wherein, the assets and liabilities including contingent liabilities as at October 1, 2006 and the transactions including income and expenses for the period October 1, 2006 to March 31, 2007 of erstwhile MSL (being the period when pending effectuation of the Scheme, the business and activities of erstwhile MSL were being run and managed in trust for the Company) for the six months period ended March 31, 2007 were incorporated in the accounts of the previous period.

(Rs. in million) As at As at September 30, 2009 September 30, 2008

2. Contingent liabilities :

a) Claims against the Company not acknowledged as debts in respect of*:-

- Income Tax 149.40 223.13

- Sales Tax 81.04 84.89

- Excise Duty/Service Tax 64.88 62.20

- License fee for railway siding 60.68 60.68

- Others 70.84 65.53

*AII the above matters are subject to legal proceedings in the ordinary course of business. The legal proceedings, when ultimately concluded will not, in the opinion of the management, have a material effect on the results of the operations or financial position of the Company.

c) The Company has provided bank guarantees aggregating Rs. 78.18 million (Previous period Rs. 126 million) to Tecumseh Products India Limited (TPIL), to whom it had sold the compressor business in a previous year, for any loss, damage, claim, action, suit etc., arising from various representations /breach of representations including for contingent liabilities existing as at March 31,1997, or prior to March 31,1997, which TPIL may eventually be liable to pay, against which demands in respect of sales tax, income tax and central excise matters aggregating Rs. 52.32 million (Previous period Rs. 89.45 million) have been received. These demands are presently under various stages of appeal.

3. The Company had surrendered on October 23, 2003 possession of 46.58 acres of its land at 15, Shivaji Marg, New Delhi to the Delhi Development Authority (DDA) pursuant to the order of Honble Supreme Court. The matter regarding validity of this surrender is sub-judice before Honble Supreme Court under a review petition.

4. Research and development expenses amounting to Rs. 14.22 million (previous period Rs.4.36 million) have been charged to the respective revenue accounts.

5. Accounting for taxes on income in accordance with the Accounting Standard (AS) 22 Accounting for Taxes on Income, notified in the Companies (Accounting Standards) Rules, 2006.

6. Sales are net of commission of Rs. 31.90 million (previous period Rs. 24.95 million).

7. The Company had imported plant and machinery in previous years under EPCG Scheme. An export obligation (EO) amounting to USD 91.68 million was placed on the Company which was to be fulfilled in a period of 8 years starting from April 1997. Subsequently, the said EO was refixed at USD 73.74 million and the EO period was extended to 30.3.2007 in terms of the Foreign Trade Policy Handbook of Procedure (HBP) 2002-2007.

The balance unfulfilled EO as at September 30, 2009 is USD 7.92 million.

The said EO period was further extended upto 30.3.2009 on payment of 50% duty payable in proportionate to unfulfilled export obligation amounting to Rs. 16.68 million and the EPCG License has been duly endorsed by Director General of Foreign Trade (DGFT) extending the EO fulfillment period upto 30.3.2009.

To fulfill the remaining EO, the Company applied to obtain a release order from Directorate of Sugar to export sugar. Directorate of Sugar vide its letter dated 20.3.2009 has informed the Company that it is not possible to issue release orders for export of sugar and the request of the Company will be considered when the sugar situation improves in the country.

By letter dated 29.9.2009 the DGFT has informed the Company that having regard to the provision of Public Notice No.26 dated 3.6.2008 the extension in export obligation period equivalent to the duration of ban is automatic without composition fee in respect of EPCG authorization issued prior to imposition of ban on such product.

At this stage, the Company is awaiting the release orders for export of sugar to fulfill the aforesaid EO.

8. Segment reporting

A. Business Segment

Based on the guiding principles given in Accounting Standard (AS) 17 "Segment Reporting" notified in the Companies (Accounting Standards) Rules, 2006, - the Companys business Segment includes Sugar, Power, Chemical and Other (Distillery).

B. Geographical Segment

Since the Companys activities/operations are primarily within the country and considering the nature of products/services it deals in, the risk and returns are same and as such there is only one geographical segment.

C. Segment accounting policies:

In addition to the significant accounting policies applicable to the business segments as set out in note 1 above, the accounting policies in relation to segment accounting are as under:

a) Segment revenue and expenses:

Segment revenue and expenses are directly attributable to the segments.

b) Segment assets and liabilities:

Segment assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fixed assets, net of allowances and provisions which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities.

c) Inter segment revenues:

Inter segment revenues between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

9. Used on the information available with the Company, the principle amount and interest due to Micro and Small Enterprise as defined under The Micro, Small and Medium Enterprises Development Act, 2006 (Act) is Rs. 2.20 million (previous period Rs. 7.01 million) and Rs. 0.27 million (previous period Rs. Nil) respectively.

10. There are various issues relating to sales tax, income tax etc. arisen / arising out of the reorganisation arrangement of DCM Limited which will be settled and accounted for in terms of the Scheme of Arrangement of DCM Limited and memorandum of understanding between all the companies involved as and when the liabilities/benefits are fully determined.

In the opinion of the management, having regard to the current status of the assessment proceedings at various stages the effect of these matters on the accounts could not be determined at this stage.

11. The Company has an investment of Rs.150 million, comprising Rs.100 million in preference shares and Rs.50 million in equity shares of Transiel India Limited (Transiel), a wholly owned subsidiary. As per the latest audited balance sheet, Transiel has accumulated losses of Rs.140.84 million upto March 31, 2009. The Company, as a measure of prudence, has made a total provision of Rs. 140 million for the estimated diminution in the value of investment on the basis of its own assessment of the erosion of the net worth of the subsidiary. The management has confirmed to auditors that the provision made is adequate and the remaining balance of investment is good and fully recoverable.

12. Consequent to import of 16385.73 metric tonnes of raw sugar, the Company has an obligation to export 15605.52 metric tonnes of white sugar by December 31, 2009. Against this export obligation, 6415.80 metric tonnes of white sugar has been exported upto the year ended September 30, 2009.

13. Related party disclosures under Accounting Standard 18 Name of related party and nature of related party relationship Subsidiaries: SFSL Investments Limited, Siel Financial Services Limited, Transiel India Limited , Siel Industrial Estate Limited and Siel Edible Oils Limited. Enterprises over which key management personnel have significant influence:

Greenfields Commercial Private Limited.

Usha International Limited

Key Management Personnel and their relatives:

Mr. Siddharth Shriram

Mr. K,P. Singh

Mr. A. K. Mehra (w.e.f.October 15,2007)

Mr. Sunil Kakria (w.e.f. January 7,2008)

14. The accounts for the year ended September 30,2009 have been prepared after considering sugar cane purchase price @ Rs. 110 per quintal as an interim measure for paying the price of sugar cane to sugar cane grower in accordance with the Order of Honble Supreme Court dated September 8,2008 in case No. 18681 of 2008 for sugar season 2007-08 filed by the Company. Necessary adjustments will be made by the Company in accordance with the final order of the Honble Court in this matter.

15. The debts of erstwhile Mawana Sugars Limited have been restructured under a package approved by Corporate Debt Restructuring (CDR) Empowered Group in its meeting held on September 26, 2007. In terms of the CDR package, the Company has issued 43,83,561 equity shares of Rs. 10 each fully paid up at a premium of Rs. 26.50 per share to a promoter of the Company on preferential basis on September 26, 2009 and the proceeds aggregating to Rs. 160.00 million have been utilized as per the CDR package.

16. The current financial year is for a period of twelve months from October 1,2008 to September 30,2009 whereas the corresponding previous period figures were for a period of eighteen months from April 1,2007 to September 30, 2008.

Therefore, the corresponding figures of previous period are not directly comparable with those of current year.

17. The Company has facilitated Agri loan from Punjab National Bank to the farmers who supply sugar cane to the Company. Such loan has to be distributed to such farmers through an Escrow Account to be operated by the Company and the Company has to facilitate repayment of loan by the farmers to the Bank against the payment to be made to them against supply of sugar cane to the Company. A sum of Rs. 1.04 million and Rs. 401.68 million has been lying in Escrow Account as on 30.09.2009 and 30.09.2008 respectively

18. Previous year figures have been regrouped wherever necessary.

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