Notes to Accounts of MSP Steel & Power Ltd.

Mar 31, 2025

M. Provisions, Contingent Liabilities & Contingent
Assets

The Company recognizes provisions when a
present obligation (legal or constructive) as a
result of a past event exists and it is probable

that an outflow of resources embodying
economic benefits will be required to settle such
obligation and the amount of such obligation
can be reliably estimated.

If the effect of time value of money is material,
provisions are discounted using a current pre¬
tax rate that reflects, when appropriate, the
risks specific to the liability. When discounting
is used, the increase in the provision due to the
passage of time is recognized as a finance cost.

A disclosure for a contingent liability is made
when there is a possible obligation or a present
obligation that may, but probably will not require
an outflow of resources embodying economic
benefits or the amount of such obligation
cannot be measured reliably. When there is
a possible obligation or a present obligation
in respect of which likelihood of outflow of
resources embodying economic benefits is
remote, no provision or disclosure is made.

Contingent assets usually arise from unplanned
or other unexpected events that give rise to the
possibility of an inflow of economic benefits.
Contingent Assets are not recognized though
are disclosed, where an inflow of economic
benefits is probable.

N. Cash and Cash Equivalents

Cash and Cash equivalents for the purpose
of Cash Flow Statement comprise cash and
cheques in hand, bank balances and demand
deposits with banks where the original maturity
is three months or less.

O. Employee Benefits

Short Term Employee Benefits: All employee
benefits payable wholly within twelve months
of rendering the service are classified as
short-term employee benefits and they are
recognized as an expense at the undiscounted
amount in the Statement of Profit & Loss of the
year in which related service is rendered.

Compensated absences: Compensated

absences which are not expected to occur
within twelve months after the end of the period
in which the employee renders the related
service are recognized based on actuarial
valuation at the present value of the obligation
as on the reporting date.

Post-Employment Benefits:

Provident Fund scheme: Retirement benefit
in the form of Provident Fund is a defined

contribution scheme and the company
recognizes contribution payable to the
provident fund scheme as expenditure when
an employee renders the related service. The
Company has no obligations other than the
contribution payable to the respective funds.

Gratuity scheme: Gratuity liability, being a
defined benefit obligation, is provided for on
the basis of an actuarial valuation on Projected
Unit Credit method made at the end of each
financial year.

Recognition and measurement of Defined
Benefit plans: The cost of providing defined
benefits is determined using the Projected
Unit Credit method with actuarial valuations
being carried out at each reporting date. The
defined benefit obligations recognized in the
Balance Sheet represent the present value of
the defined benefit obligations as reduced by
the fair value of plan assets, if applicable. Any
defined benefit asset (negative defined benefit
obligations resulting from this calculation) is
recognized representing the present value
of available refunds and reductions in future
contributions to the plan.

All expenses represented by current service
cost, past service cost, if any, and net interest
on the defined benefit liability / (asset) are
recognized in the Statement of Profit and
Loss. Remeasurements of the net defined
benefit obligation, which comprise actuarial
gains and losses, the return on plan assets
(excluding interest) and the effect of the asset
ceiling, are recognized in other comprehensive
income. Remeasurement recognized in
other comprehensive income is reflected
immediately in retained earnings and will not be
reclassified to the statement of profit and loss.

P. Leases

The Company as lessee

The Company assesses whether a contract is or
contains a lease, at inception of a contract. The
assessment involves the exercise of judgement
about whether (i) the contract involves the use
of an identified asset, (ii) the Company has
substantially all of the economic benefits from
the use of the asset through the period of the
lease, and (iii) the Company has the right to
direct the use of the asset.

The Company recognizes a right-of-use asset
(“ROU”) and a corresponding lease liability at

the lease commencement date. The ROU asset
is initially recognized at cost, which comprises
the initial amount of the lease liability adjusted
for any lease payments made at or before
the commencement date, plus any initial
direct costs incurred and an estimate of costs
to dismantle and remove the underlying
asset or to restore the underlying asset or
the site on which it is located, less any lease
incentives. They are subsequently measured
at cost less accumulated depreciation and
impairment losses.

The ROU asset is depreciated using the straight
line method from the commencement date to
the earlier of, the end of the estimated useful life
of the ROU asset or the end of the lease term. In
addition, the right-of-use asset is periodically
reduced by impairment losses, if any, and
adjusted for certain re-measurements of the
lease liability.

The lease liability is initially measured at the
present value of the lease payments that
are not paid at the commencement date,
discounted using the interest rate implicit
in the lease or, if that rate cannot be readily
determined, the Company uses an incremental
borrowing rate specific to the Company, term
and currency of the contract. Generally, the
Company uses its incremental borrowing rate
as the discount rate.

Lease payments included in the measurement
of the lease liability include fixed payments,
variable lease payments that depend on an
index or a rate known at the commencement
date; and extension option payments or
purchase options payment which the Company
is reasonably certain to exercise.

Variable lease payments that do not depend
on an index or rate are not included in the
measurement the lease liability and the ROU
asset. The related payments are recognized as
an expense in the period in which the event or
condition that triggers those payments occurs
and are included in the line “other expenses” in
the statement of profit or loss.

After the commencement date, the amount
of lease liabilities is increased to reflect the
accretion of interest and reduced for the
lease payments made and remeasured (with
a corresponding adjustment to the related
ROU asset) when there is a change in future
lease payments in case of renegotiation,

changes of an index or rate or in case of
reassessment of options.

Short-term leases and leases of low-value
assets:

The Company has elected not to recognize ROU
assets and lease liabilities for short term leases
as well as low value assets and recognizes the
lease payments associated with these leases
as an expense on a straight-line basis over
the lease term.

Q. Borrowing Cost

Borrowing cost includes interest, amortization
of ancillary costs incurred in connection with
the arrangement of borrowings and exchange
differences arising from foreign currency
borrowings to the extent they are regarded as
an adjustment to the interest cost.

Borrowing costs, if any, directly attributable to
the acquisition, construction or production of
an asset that necessarily takes a substantial
period of time to get ready for its intended
use or sale are capitalized, if any. All other
borrowing costs are expensed in the period in
which they occur.

R. Earnings Per Share

Basic earnings per share is calculated by
dividing the net profit or loss for the period
attributable to equity shareholders by the
weighted average number of equity shares
outstanding during the period. For the purpose
of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity
shareholders are divided with the weighted
average number of shares outstanding during
the year after adjustment for the effects of all
dilutive potential equity shares.

S. Segment Reporting

Operating segments are reported in a manner
consistent with the internal reporting provided
to the Chief Operating Decision Maker (CODM)
of the Company. The CODM is responsible
for allocating resources and assessing
performance of the operating segments
of the Company.

T. Rounding Off

All amounts disclosed in the financial
statements and notes have been rounded
off to the nearest lakhs as per requirement of
Schedule III, unless otherwise stated.

2. KEY ACCOUNTING ESTIMATES &
JUDGEMENTS:

The preparation of the Company’s financial
statements requires the management to make
judgements, estimates and assumptions that
affect the reported amounts of revenues, expenses,
assets and liabilities, and the accompanying
disclosures, and the disclosure of contingent
liabilities. Uncertainty about these assumptions
and estimates could result in outcomes that require
a material adjustment to the carrying amount of
assets or liabilities affected in future periods.

The key assumptions concerning the future and
other key sources of estimation uncertainty at the
reporting date, that have a significant risk of causing
a material adjustment to the carrying amounts of
assets and liabilities within the next financial year,
are described below:

2.1. Significant judgments when applying Ind AS 115

Revenue is recognized upon transfer of control of
promised products to customers in an amount
that reflects the consideration which the Company
expects to receive in exchange for those products.
Revenue is measured based on the transaction
price, which is the consideration, adjusted for
volume discounts, price concessions and incentives,
if any, as specified in the contract with the customer.
The Company exercises judgment in determining
whether the performance obligation is satisfied at a
point in time or over a period of time. The Company
considers indicators such as who controls the asset
as it is being created or existence of enforceable
right to payment for performance to date and
alternate use of such product, transfer of significant
risks and rewards to the customer, acceptance of
delivery by the customer, etc.

2.2. Useful lives of depreciable assets

As described in the material accounting policies,
the Company reviews the estimated useful lives
of property, plant and equipment and intangible
assets at the end of each reporting period.

2.3. Defined benefit obligation

The cost of post-employment benefits is determined
using actuarial valuations. The actuarial valuation
involves making assumptions about discount rates,
expected rate of return on assets, future salary
increases and mortality rates. Due to the long term
nature of these plans such estimates are subject to
significant uncertainty.

2.4. Impairment of financial assets

The Company assesses impairment based on
Expected Credit Losses (ecl) model on trade
receivables. The Company uses a provision matrix
to determine impairment loss allowance on the
portfolio of trade receivables. The provision matrix
is based on its historically observed default rates
over the expected life of the trade receivable and
is adjusted for forward looking estimates. At every
reporting date, the historically observed default
rates are updated and changes in the forward¬
looking estimates are analysed.

2.5. Impairment of Investment in Subsidiary

The Company uses judgment in making these
assumptions and selecting the inputs to the
impairment calculation, based on the respective
company’s past history, existing market conditions
as well as forward looking estimates at the end of
each reporting period.

2.6. Recoverability of advances/ receivables

At each balance sheet date, based on discussions
with the respective counterparties and internal
assessment of their credit worthiness, the
management assesses the recoverability of

outstanding receivables and advances. Such
assessment requires significant management
judgement based on financial position of the
counterparties, market information and other
relevant factor.

2.7.Contingent assets and liabilities, uncertain
assets and liabilities

Liabilities that are uncertain in timing or amount
are recognized when a liability arises from a past
event and an outflow of cash or other resources
is probable and can be reasonably estimated.
Contingent liabilities are possible obligations where
a future event will determine whether Company
will be required to make a payment to settle the
liability, or where the size of the payment cannot be
determined reliably. Material contingent liabilities
are disclosed unless a future payment is considered
remote. Evaluation of uncertain liabilities and
contingent liabilities and assets requires judgment
and assumptions regarding the probability of
realization and the timing and amount, or range
of amounts, that may ultimately be incurred. Such
estimates may vary from the ultimate outcome as a
result of differing interpretations of laws and facts.

15.1 Terms of Repayments

a) Term Loan facilities from banks are secured by first pari-passu charge on the entire fixed assets (both
present & future) and Second pari-passu charge on the entire current assets (both present & future) of
the Company. Personal guarantee of Puranmal Agrawal, Suresh Kumar Agrawal, Manish Agrawal and Saket
Agrawal is given alongwith corporate guarantee of a group company. Corporate Guarantee is restricted to
the extent of shares pledged of the promoter group company. The interest rate on the domestic long term
borrowings are of 2.90% above 6 months MCLR. The Term Loan facilitated from the bank is repayable in 30
Quarterly Instalments from December 2017. Last instalment due in September 2025.

b) Pursuant to the Resolution Plan approved under the Reserve Bank of India''s Scheme for Sustainable
Structuring of Stressed Assets (S4A), the Company executed a Master Framework Agreement with the lenders
in 24^th January 2018.

The Company had issued 451,970,554 nos. of Optionally Convertible Debentures (OCDs) amounting to H
451,97.05 lakhs during the financial year 2017-18. The OCDs had a moratorium period of 7 years and were
repayable in 36 structured quarterly instalments starting from December, 2024 and maturing on September
2033. The OCDs carried a coupon rate of 0.01% pa. payable quarterly till maturity. The OCDs were convertible
into Equity at the option of the OCD holders. OCDs may be redeemed alongwith a redemption premium. The
redemption premium is inclusive of YTM @ 2.00% p.a. compounded quarterly. As per valuation report and
relevant IND AS, PV of OCD as on the OCD issuing date i.e. March 21, 2018 was H 16,690.00 Lakhs which had
been treated as financial liability and balance of H 28,506.44 Lakhs had been treated as other equity in the
financial year 2017-18.

Further, the interest expenses (the unwinding of the discount) had been booked at market rate (11.5%) to
unwind the liability component to the extent of value of OCD at each reporting date.

In addition to the above, the Promoter / Promoters’ group had transferred 12,85,78,044 equity shares, at H 10/-
per equity share of H 12,857.80 lakhs, to the lenders, as a part payment of unsustainable debt and the same
was treated as unsecured loan.

Upon receipt of conversion notices from OCD holders and approval of shareholders for conversion of
Unsecured loans from promoters, the Company has undertaken the following debt-to-equity conversions
during the financial year 2024-25:

(a) Conversion of Outstanding OCDs (net of repayments) amounting to H. 45,157.15 lakhs along with YTM of
H 6,953.08 lakhs into 14,48,22,208 equity shares of face value H 10 each at a premium.

(b) Conversion of Outstanding Unsecured Loans (net of repayments) amounting to H 12,795.80 Lakhs into
3,65,59,437 equity shares of face value H 10 each at a premium.

30. The Company is subject to Income Tax in India on the basis of Standalone Financial Statements. As per the Income
Tax Act, 1961, in the previous year, the Company was liable to pay income tax which is the higher of regular
income tax payable and the amount payable based on the provisions applicable for Minimum Alternate Tax
(MAT). However, from the current year, the Company has opted the option u/s 115 BAA of the Income Tax Act, 1961;
introduced by the Taxation Laws (Amendment) Act, 2019, which gives irreversible option for payment of Income
Tax at reduced rate subject to certain conditions.

In view of above, MAT Credit of H 2,648.71 Lakhs accounted for in earlier years has been reversed during the current
year. Further, Deferred Tax Assets/Liabilities also have been measured/re-measured at the rates specified under
new regime. Due to the change in the applicable income tax rate under the new regime, an impact of H 0.86 Lakhs
has been recognised and included in the below reconciliation.

This section gives an overview of the significance of financial instruments for the Company and provides additional
information on balance sheet items that contain financial instruments. The details of significant accounting policies,
including the criteria for recognition, the basis of measurement and the basis on which income and expenses are
recognised in respect of each class of financial asset, financial liability and equity instrument are disclosed in Note F.1
& F.2 to the financial statements.

34. Financial instruments (Contd..)

ii) Fair values hierarchy

The following table provides an analysis of financial instruments that are measured subsequent to initial
recognition at fair value, grouped into Level 1 to Level 3, as described below:

Quoted prices in an active market (Level 1): This level of hierarchy includes financial assets that are measured by
reference to quoted prices (unadjusted) in active markets for identical assets or liabilities. This category consists
of investment in quoted equity shares.

Valuation techniques with observable inputs (Level 2): This level of hierarchy includes financial assets and
liabilities, measured using inputs other than quoted prices included within Level 1 that are observable for the
asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices). This level of hierarchy includes
Company’s over-the-counter (otc) derivative contracts.

Valuation techniques with significant unobservable inputs (Level 3): This level of hierarchy includes financial
assets and liabilities measured using inputs that are not based on observable market data (unobservable inputs).
Fair values are determined in whole or in part, using a valuation model based on assumptions that are neither
supported by prices from observable current market transactions in the same instrument nor are they based on
available market data.

iii) Valuation process and technique used to determine fair value

Specific valuation techniques used to value financial instruments include:

(a) Quoted investments (Equity Shares)- The Quoted Equity Instruments are listed in Calcutta Stock Exchange
where the trading is suspended. Value is as determined by Independent Valuer. Fair value estimates of equity
investments are included in level-3 and are based on information relating to value of investee company’s
net assets methods.

(b) The fair value of investment in unquoted shares are determined by an Independent Valuer. The invetsment
in equity shares of H 4,099.86 Lakhs (31.03.2024 - H 4,020.66 lakhs) are not listed. Their fair value estimates are
included in level-3 and are based on information relating to value of investee company’s net assets or DCF
methods as applicable.

(c) The carrying amount of financial assets (other than investments) and financial liabilities (other than derivative
liabilities) measured at amortised cost in the financial statements are a reasonable approximation of their
fair values since the Company does not anticipate that the carrying amounts would be significantly different
from the values that would eventually be received or settled.

(d) The Company’s forward exchange contracts have been valued based on mark to market reports provided
by the counterparty bank. Since the valuation uses observable market inputs, but not quoted prices in active
markets, the fair value measure has been classified under Level 2.

iv) Valuation inputs and relationships to fair value

The following table provides the fair value measurement hierarchy about the significant unobservable inputs

used in level 3 fair value measurements. Refer (iii)(b) above for the valuation techniques adopted.

35. Financial Risk Management, Objectives and Policies

a) Capital Management

i) Risk Management

The Company’s objectives when managing capital are to

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

- maintain an optimal capital structure to reduce the cost of capital

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid
to shareholders, return capital to shareholders, issue new share, convert outstanding OCD''s into equities or
sell assets to reduce debt. Consistent with others in the industry, the Company monitors capital on the basis
of net debt to equity ratio and maturity profile of overall debt portfolio of the Company.

Net debt implies total borrowings of the Company comprises all components attributable to the
owners of the Company

No changes were made in the objective policies & process for expenditure as on 31^st March 2025 &
31^st March 2024.

ii) Dividends

The company has not declared/paid any dividend for FY 2023-24 and no dividend has been proposed
for FY 2024-25.

b) Financial Risk Management

The Company’s activities expose it to market risk, liquidity risk and credit risk. In order to minimise any adverse effects
on the financial performance of the Company, the Company has risk management policies as described below :-

i) Credit risk

Credit risk refers to the risk of financial loss arising from default / failure by the counterparty to meet financial
obligations as per the terms of contract. The Company is exposed to credit risk for receivables, cash and cash
equivalents. None of the financial instruments of the Company result in material concentration of credit risks.

Customer credit risk is managed by the Company’s established policy, procedures and control relating to
customer credit risk management. Outstanding customer receivables are regularly monitored and reconciled.
Based on historical trend, industry practice and the business environment in which the company operates,
an impairment analysis is performed at each reporting date for trade receivables. The maximum exposure
to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in Note 9.

Credit Risk on cash and cash equivalent, deposits with the banks/financial institutions is generally low as
the said deposits have been made with the banks/financial institutions who have been assigned high credit
rating by international and domestic rating agencies.

ii) Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or
at reasonable price. Prudent liquidity risk management implies maintaining sufficient cash and marketable
securities and the availability of funding through an adequate amount of credit facilities to meet obligations
when due. The Company’s treasury team is responsible for liquidity, funding as well as settlement management.
In addition, processes and policies related to such risks are overseen by senior management. Management
monitors the Company’s liquidity position through rolling forecasts on the basis of expected cash flows.

Maturities of financial liabilities

The table below provides details regarding the remaining contractual maturities of financial liabilities at the
reporting date based on contractual undiscounted payments

C) Market Risk

i) Foreign currency risk

The company is primarliy not exposed to foreign exchange risk arising from foreign currency transactions.
However, the Company has entered into derivative contracts to hedge its exposure in foreign currency due to
swap of INR Loan into USD. Foreign exchange risk arises from recognised assets and liabilities denominated
in a currency that is not the company’s functional currency.

36. Contingent Liabilities and Commitments (Contd..)

The Company, based on a legal opinion from a firm of repute, has re-estimated the amount of RoR amounting
to H 10,120 lakhs as compared to H 27,801 lakhs, which states that as per CDR Master Circular dated June 25, 2015
issued by the Corporate Debt Restructuring Cell (CDR) in 2012 & 2015, if any part of principal or interest dues are
converted into equity, the same will not be reckoned for computation of recompense. Since all the outstanding
OCDs has been converted during the year, accordingly ROR as at 31^st March, 2025 has been calculated only on
outstanding term loans and short term borrowings.

b) The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributions by
the company towards Provident Fund and Gratuity. The Ministry of Labour and Employment has released draft
rules for the Code on Social Security, 2020 on November 13, 2020, and has invited suggestions from stakeholders
which are under active consideration by the Ministry. 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.

c) Capital & Other Commitment

The capital & other commitment for the company amounts to H Nil (previous year - H Nil)

37. The Company does not have any charges or satisfaction of which is yet to be registered with ROC beyond the

statutory period as on 31^st March 2025.

38. The company has not filed any Scheme of Arrangements in terms of sections 230 to 237 of the Companies Act,
2013 with any Competent Authority.

39. Short Term Leases

The Company’s leasing arrangements are in respect of short term leases for office premises at Kolkata and
Raigarh, depot at Raipur & guest houses at Raigarh, Gairkata, Keonjhar, Vishakapatnam and Kolkata. These leasing
arrangements which are cancellable, are entered for a period of 11 months and the Company has elected not to
recognize ROU assets and lease liabilities for short term leases and recognizes the lease payments associated with
these leases as an expense. The Company has paid lease rentals of H 267.57 Lakhs ( Previous year - H 157.00 Lakhs).
The company also hires equipments on short term contract basis, and has paid H 1,754.16 Lakhs (Previous year -
H 1,942.30 Lakhs) against it during the year which is included in other manufacturing expenses.

Defined Benefit Plan:
a) Gratuity Plan

The Company has a defined Gratuity Benefit plan. Every employee who has completed five years or more of
service is entitled to gratuity as per the provisions of the Payment of Gratuity Act, 1972. The Company has got
an approved gratuity fund with Life Insurance Corporation of India (lic) to cover the gratuity liabilities.The
present value of defined obligation and related current cost are measured using the Projected Unit Credit
Method with actuarial valuation being carried out at Balance Sheet date.

40. Disclosure pursuant to Indian Accounting Standard - 19 ‘Employee Benefits’ (Contd..)

b) Risk Exposure

Defined benefit plans expose the Company to the following types of actuarial risks:

Interest rate risk: The Plan exposes the company to the risk of fall in interest rates . A fall in interest rates will
result in an increase in the ultimate cost of providing the above benefit and will thus result in an increase in
the value of the liability (as shown in financial statements).

Liquidity Risk: This is the risk that the company is not able to meet the short term gratuity payouts .This may
arise due to non availability of enough cash / cash equivalent to meet the liabilities or holding of illiquid
assets not being sold in time.

Salary Escalation Risk: The Present value of the defined benefit plan is calculated with the assumption of
salary increase rate of plan participants in future . Deviation in the rate of increase of salary in future for plan
participants from the rate of increase in salary used to determine the present value of obligation will have a
bearing on the plan''s liability.

Demographic Risk: The company has used certain mortality and attrition assumption in valuation of the
liability . The Company is exposed to the risk of actual experience turning out to be worse compared to
the assumption.

Regulatory Risk: Gratuity benefit is paid in accordance with the requirement of the Payment of Gratuity Act,
1972 (as amended from time to time). There is risk of change in regulations requiring higher gratuity payouts
(e.g. Increase in the maximum limit on gratuity of H 20,00,000).

Asset Liability Mismatching or Market Risk: The duration of the liability is longer compared to duration of
assets, exposing the Company to market risk for volatilities/fall in interest rate.

Investment Risk: The probability or likelihood of occurrence of losses relative to the expected return on any
particular Investment.

c) Reconciliation Of the net defined benefit (Assets/Liabilities)

The following table shows a reconciliation from the opening balances to the closing balances for the net
defined benefit (asset)/ liability and its components:

40. Disclosure pursuant to Indian Accounting Standard - 19 ‘Employee Benefits’ (Contd..)

The Gratuity Scheme is invested in policies offered by Life Insurance Corporation (lic) of India . The information
on the allocation of the fund into major asset classes and expected return on each major class are not readily
available. The expected rate of return on plan assets is based on market expectations, at the beginning of the
period, for returns over the entire life of the related obligation.

i) Asset Liability Matching Strategy

The company has purchased insurance policy which is basically a year on year cash accumulation plan in
which the interest rate is declared on yearly basis and is guaranteed for a period of one year. The Insurance
company as a part of policy rules makes payment of all gratuity outgoes happening during the year (subject
to sufficiency of fund under the policy). The Policy, thus mitigate the liquidity risk. However, being cash
accumulation plan the duration of assets shorter compared to the duration of liabilities. Thus the company
is exposed to movement in interest rate (in Particular the significant fall in interest rate which should result in
a increase in liability without corresponding increase in assets).

** For the year ended March 31, 2025 the Company has paid/ provided managerial remuneration amounting to H 274.11 lakhs to its
directors which is in excess of the limit set under section 197 of the Companies Act, 2013. The Company proposes to seek approval of the
shareholders by way of special resolution at the ensuing annual general meeting for waiver of recovery of such excess remuneration paid
in terms of section 197(10) of the Companies Act, 2013.

Key Managerial Personnel and Relatives of Promoters who are under the employment of the Company are entitled
to post employment benefits and other long term employee benefits recognised as per Ind AS 19- ‘Employee
Benefits’ in the financial statements. As these employee benefits are lump sum amounts provided on the basis of
actuarial valuation, the same is not included above.

The Company has received personal guarantee from Puranmal Agrawal, Suresh Kumar Agrawal, Manish
Agrawal & Saket Agrawal in relation to loan taken from banks having outstanding balance of H 24,102.58 lakhs
(PY H 31,775.06 lakhs).

Terms and Conditions of transactions with Related Parties

The transactions with Related Party are made in the normal course of business and on terms equivalent to those that
prevail in arm''s length transactions. Outstanding Balances at the year end are unsecured and settlement occurs in
cash for the year ended 31^st March, 2025 (except for the transactions mentioned in Note 15.1.(b)), the Company has
recorded the receivable relating to amount due from Related Parties. This assessment is undertaken each Financial
Year through examining the Financial position of the Related Parties and the market in which the Related Party operates.

In respect of the above parties, there is no provision for doubtful debts as on 31^st March 2025 and no amount has been
written off or written back during the year in respect of debt due from/to them.

42. Segment information

As the Company’s business activity falls within a single significant primary business segment i.e. “Manufacturing/
Trading of Iron & Steel Products”, no separate segment information is disclosed. These, in the context of Ind AS 108
on “Operating Segments” are considered to constitute one segment and hence,the Company has not made any
additional segment disclosures.

The information relating to revenue from external customers and location of non-current assets of its single
reportable segment has been disclosed as below:

Information about major customers

Total amount of revenues from customers (each exceeding 10% of total revenues of the Company) is H Nil (Previous
Year H Nil Lakhs).

43. Corporate social responsibility

As per Section 135 of the Companies Act, 2013, a company meeting the applicable threshold, needs to spend at least
2% of its average net profit for the immediately preceding three financial years on corporate social responsibility
(csr) activities. The areas for CSR activities are in accordance to the CSR Policy of the Company which includes Rural
Development Project, eradicating hunger, poverty and malnutrition, healthcare and sanitation, animal welfare, etc. A
CSR committee has been formed by the Company as per the Act.

47 Other Statutory Information

(a) The Company has not revalued its Property, Plant and Equipment (including Right-of-Use Assets) and intangible
assets during the current and previous financial year.

(b) The Company has not given any loans or advances in the nature of loans either repayable on demand or without
specifying any terms or period of repayment granted to promoters, directors, KMPs and related parties.

(c) The Company has used borrowings from banks and financial institutions for the specific purpose for which
it was obtained.

(d) The Company does not have any Benami property. Further, there are no proceedings initiated or are pending
against the Company for holding any benami property under the Prohibition of Benami Property Transactions Act,
1988 and rules made thereunder.

(e) The Company does not have transactions with any struck off companies during the current and previous
financial year.

(f) The Company has not traded or invested in Crypto currency or Virtual Currency during the current and previous
financial year.

(g) 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:

(i) 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

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

(h) 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:

(i) 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

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

47 Other Statutory Information (Contd..)

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

(j) The Company has not been declared as a wilful defaulter by any bank or financial institution or government or
any other lender.

(k) The company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read
with Companies (Restriction on number of Layers) Rules, 2017.

48. The Company has used two accounting software(s) for maintaining its books of account. One of the software
had 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 at application and database level. Further, no instance of audit
trail feature being tampered with was noted in respect of the aforementioned software where the audit trail
feature has been enabled.

In case of other accounting software which is operated by a third-party software service provider to capture
incentive points of the dealers, Service Organisation Controls 1 type 2 report is not available, hence the Company
is unable to determine whether audit trail feature of the said software was enabled and operated throughout the
year for all relevant transactions recorded in the software or whether there were any instances of the audit trail
feature being tampered with.

Additionally, the audit trail has been preserved by the Company as per the statutory requirements for record
retention for the software whose audit trail feature was enabled.

49 The financial statements for the year ended March 31,2025 were approved by the Board of Directors and authorised
for issue on May 30, 2025.

50. The previous year’s figures have been regrouped, rearranged and reclassified to conform to the classification of
the current year, wherever necessary.

As per our report of even date: For and on behalf of Board of Directors

For Singhi & Co.

Chartered Accountants

Firm Registration No.-302049E Suresh Kumar Agrawal Manish Agrawal

Chairman Managing Director

DIN - 00587623 DIN - 00129240

Shrenik Mehta

Partner Kamal Kumar Jain Shreya Kar

Membership No.-063769 Chief Financial Officer Company Secretary

Kolkata, 30^th May, 2025 Mem No. A41041

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Mar 31, 2024

Note -

The Company is subject to tax assessments and ongoing proceedings, which are pending before various Tax Appellate Authorities. Management periodically evaluates the positions taken in tax returns with respect to above matters, including unresolved tax disputes, which involves interpretation of applicable tax regulations and judicial precedents. Current tax liability and tax asset balances are presented, after recognising as appropriate, provision for taxes payable and contingencies basis management''s assessment of outcome of such ongoing proceedings and amounts that may become payable to the tax authorities. Considering the nature of such estimates and uncertainties involved, the amount of such provisions may change upon final resolution of the matters with tax authorities.

9.6 No element of financing is deemed present as the sales are generally made with a credit term which is consistent with market practice.

9.7 There are no "unbilled" and "disputed" trade receivables, hence the same are not disclosed in the ageing schedule.

9.8 In determining allowance for credit losses of trade receivables, the Company has used the practical expedient by computing the expected credit loss allowance based on a provision matrix. The provision matrix takes into account historical credit loss experience and is adjusted for forward looking information. The expected credit loss allowance is based on ageing of the receivables and rates used in the provision matrix.

13.2 Rights, Preferences and restrictions attached to equity shares

The company has only one class of equity shares having a par value of H 10/- per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of shareholders. In the event of liquidation of the company, the equity shareholders are eligible to receive the remaining assets of the company after distribution of all preferential amounts, in proportion to their shareholding.

13.5 Additional Disclosure in the respect of Equity Share

(a) The Company does not have any Holding Company or Ultimate Holding Company.

(b) No ordinary shares have been reserved for issue under options and contracts/commitments for the sale of shares/ disinvestment as at the Balance Sheet date.

(c) The Company has not bought back any shares during the period of five years preceding the date at which the Balance Sheet is prepared.

Description of nature and purpose of each reserve

Securities Premium

This reserve is used to record the premium received on issue of shares. The reserve is utilised in accordance with the provisions of Companies Act, 2013.

Retained Earnings

It comprises of accumulated profit/(losses) of the company.

6% Redeemable Preference Shares

The CCPS was converted to 6% Redeemable Preference Shares under section 48 of the Companies Act, 2013 and the Article 10 of the Articles of Association of the Company which is ratified in writing by holders of atleast 3/4^th of nominal value of issued Preference Shares. The company will convert the same into CCPS and subsequently into equity in future.

Equity Component of Optionally Convertible Debenture

This contains the equity portion of the Optionally convertible debentures issued in lieu of long term borrowings as per the terms of the restructuring scheme.

Equity Instruments through Other Comprehensive Income

The Company has elected to recognise changes in the fair value of quoted investments in equity securities in OCI. These changes are accumulated within the FVOCI equity investment reserve within equity. The Company transfers amounts from this reserve to retained earnings when the relevant equity securities are derecognised.

15.1 Terms of Repayments

a) Term Loan facilities from banks are secured by first pari-passu charge on the entire fixed assets (both present & future) and Second pari-passu charge on the entire current assets (both present & future) of the company''s manufacturing facilities situated at Jamgaon, Raigarh in the state of Chhattisgarh. Personal guarantee of Puranmal Agrawal, Suresh Kumar Agrawal, Manish Agrawal and Saket Agrawal is given alongwith corporate guarantee of M/s Ilex Pvt Ltd. Corporate Guarantee is restricted to the extent of shares pledged of the promoter group companies. The interest rate on the domestic long term borrowings are of 2.90% above 6 months MCLR. The Term Loan facilitated from the bank is repayable in 30 Quarterly Instalments from December 2017. Last instalment due in September 2025.

b) The Company has issued 451,970,554 nos. of OCDs amounting to H 451,97.05 lakhs during the year 201718. The OCDs shall have moratorium period of 7 years and shall be repayable in 36 structured quarterly instalments starting from December, 2024 and maturing on September 2033. The OCDs shall carry a coupon rate of 0.01% pa. payable quarterly till maturity. The OCDs will be converted to Equity at the option of the Debenture holders. OCDs may be redeemed alongwith a redemption premium. The redemption premium will be calculated with YTM @ 2.00% p.a. compounded quarterly. As per valuation report and relevant IND AS, PV of OCD as on the OCD issuing date i.e. March 21, 2018 is H 166.90 crore which has been treated as financial liability and balance of H 285.07 crore has been treated as other equity. Subsequently interest expenses (the unwinding of the discount) have been booked at market rate (11.5%) to unwind the liability component to the extent of value of OCD.

c) Pursuant to the scheme for restructuring of loan as approved by the Overseeing Committee (OC) of Reserve Bank of India and agreement dated 24.01.2018 , the Promoter / Promoters'' group has transferred 12,85,78,044 equity shares, at H 10/- per equity share of H 12857.80 lakhs, to JLF lenders, as a part payment of unsustainable debt and the same is treated as unsecured loan and shall always be subordinated to the existing senior debt of the borrower.

d) Rate of Interest for the loan from the related parties is maximum being 10%.

17.1 Terms and conditions attached to Short term borrowings from banks

(a) Cash Credit facilities from banks are secured by first pari-passu charge on the entire current assets (both present & future) and Second pari-passu charge on the entire fixed assets (both present & future) of the company''s manufacturing facilities situated at Jamgaon, Raigarh in the state of Chhattisgarh. Personal guarantee of Puranmal Agrawal, Suresh Kumar Agrawal, Manish Agrawal and Saket Agrawal is given alongwith corporate guarantee of M/s Ilex Pvt Ltd. Corporate Guarantee is restricted to the extent of shares pledged of the promoter group companies. The rate of interest on cash credit is 2.75% above 6 month MCLR.

(b) The Intercorporate loans carry an interest rate of 9.85% p.a (Previous Year - 9.85%)

17.2 Refer Note No. 45 in the respect of Quarterly Return/Statement filed with the bank in lieu of sanctioned working capital facilities.

18.1 rade Payables include acceptances and arrangements where operational suppliers of goods and services are paid by banks while the company continues to recognise the liability till settlement with the banks which are normally effected within a period of 90 or 180 days amounting to H 7, 602.70 lakhs ( previous year H 8,867.75 lakhs)

On the basis of physical verification of non-current assets and cash generation capacity of those assets, in the management perception, there is no impairment of non current assets as on 31^st March 2024. Based on the registered valuers'' valuation report, the management has recognised an impairment reversal on the investment in its Joint Venture Madanpur South Coal Company Limited of H 30.75 Lakhs for the FY 2022-23.

C. The Taxation Laws (Amendment) Ordinance 2019 was promulgated on September 20, 2019. The Ordinance amends the income tax Act 1961 and the Finance Act 2019. The Ordinance provides domestic companies with a non-reversible option to opt for lower tax rates, provided they do not claim certain deductions. The company has evaluated the same and decided to continue with the existing tax structure until utilisation of accumulated minimum alternate tax (MAT) , tax incentives and other deductions available to the Company

This section gives an overview of the significance of financial instruments for the Company and provides additional information on balance sheet items that contain financial instruments. The details of significant accounting policies, including the criteria for recognition, the basis of measurement and the basis on which income and expenses are recognised in respect of each class of financial asset, financial liability and equity instrument are disclosed in Note 1 (g) to the financial statements.

ii) Fair values hierarchy

The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Level 1 to Level 3, as described below:

Quoted prices in an active market (Level 1): This level of hierarchy includes financial assets that are measured by reference to quoted prices (unadjusted) in active markets for identical assets or liabilities. This category consists of investment in quoted equity shares.

Valuation techniques with observable inputs (Level 2): This level of hierarchy includes financial assets and liabilities, measured using inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices). This level of hierarchy includes Company''s over-the-counter (OTC) derivative contracts.

Valuation techniques with significant unobservable inputs (Level 3): This level of hierarchy includes financial assets and liabilities measured using inputs that are not based on observable market data (unobservable inputs). Fair values are determined in whole or in part, using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data.

iii) Valuation process and technique used to determine fair value

Specific valuation techniques used to value financial instruments include:

(a) Quoted investments (Equity Shares)- Market Value

(b) Unquoted Investments - As determined by Independent Valuer. The equity shares of H 4,020.66 Lakhs (31.03.2023 - H 4,092.53 lakhs) are not listed. Fair value estimates of equity investments are included in level-3 and are based on information relating to value of investee company''s net assets and DCF methods.

(c) The carrying amount of financial assets and financial liabilities measured at amortised cost in the financial statements are a reasonable approximation of their fair values since the Company does not anticipate that the carrying amounts would be significantly different from the values that would eventually be received or settled.

35. Financial Risk Management, Objectives and Policies

A) Capital Management

i) Risk Management

The Company''s objectives when managing capital are to

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

- maintain an optimal capital structure to reduce the cost of capital

In order to maintain or adjust the capital structure, the company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. Consistent with others in the industry, the Company monitors capital on the basis of net debt to equity ratio and maturity profile of overall debt portfolio of the Company.

Net debt implies total borrowings of the Company comprises all components attributable to the owners of the Company

No changes were made in the objective policies & process for expenditure as on 31^st March 2024 & 31^st March 2023.

ii) Dividends

The company has not declared/paid any dividend for FY 2022-23 and no dividend has been proposed for FY 2023-24.

The Company''s activities expose it to market risk, liquidity risk and credit risk. In order to minimise any adverse effects on the financial performance of the Company, the company has risk management policies as described below :-

i) Credit risk

Credit risk refers to the risk of financial loss arising from default / failure by the counterparty to meet financial obligations as per the terms of contract. The Company is exposed to credit risk for receivables, cash and cash equivalents. None of the financial instruments of the Company result in material concentration of credit risks.

Customer credit risk is managed by the Company''s established policy, procedures and control relating to customer credit risk management. Outstanding customer receivables are regularly monitored and reconciled. Based on historical trend, industry practice and the business environment in which the company operates, an impairment analysis is performed at each reporting date for trade receivables. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in Note 9.

Credit Risk on cash and cash equivalent, deposits with the banks/financial institutions is generally low as the said deposits have been made with the banks/financial institutions who have been assigned high credit rating by international and domestic rating agencies.

ii) Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at reasonable price. Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of credit facilities to meet obligations when due. The Company''s treasury team is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the Company''s liquidity position through rolling forecasts on the basis of expected cash flows.

C) Market Risk

i) 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 recognised assets and liabilities denominated in a currency that is not the company''s functional currency.

Nominal value of forward contracts & option contracts that hedge monetary labilities in foreign currencies, and for which no hedge accounting is applied, are recognised in the Statement of profit and loss. The value of such contracts amount to H Nil (previous year - H 2532.00 lakhs)

The Company enters into certain derivative contracts to hedge risks which are not designated as hedges. Such contracts are accounted for fair value through profit and loss and are included in other income / expenses.

ii) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s short term borrowing and long term borrowings with floating interest rates. The Company constantly monitors the credit markets and rebalances its financing strategies to achieve an optimal maturity profile and financing cost.

D) Other Price Risk

Other price risk is the risk that the fair value of a financial instrument will fluctuate due to changes in market traded price. Other price risk arises from financial assets such as investments in equity instruments and bonds. The Company is exposed to price risk arising mainly from investments in equity instruments recognised at FVTOCI.

b) The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributions by the company towards Provident Fund and Gratuity. The Ministry of Labour and Employment has released draft rules for the Code on Social Security, 2020 on November 13, 2020, and has invited suggestions from stakeholders which are under active consideration by the Ministry. 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.

c) Capital Commitment

The capital commitment for the company amounts to H nil (h nil)

37. The Company did not raise any term loans or no new working capital borrowings have been sanctioned the current year. Accordingly, the Company does not have any charges to be filed or satisfaction which is yet to be registered with ROC beyond the statutory period.

38. The company has not filed any Scheme of Arrangements in terms of sections 230 to 237 of the Companies Act, 2013 with any Competent Authority.

39. Short Term Leases

The Company''s leasing arrangements are in respect of short term leases for office premises at Kolkata and Raigarh, depot at Raipur & guest houses at Raigarh, Gairkata, Keonjhar, Vishakapatnam and Kolkata. These leasing arrangements which are cancellable for period of 11 months and the Company has elected not to recognize ROU assets and lease liabilities for short term leases and recognizes the lease payments associated with these leases as an expense on a straight-line basis over the lease term. The Company has paid lease rentals of H 157.00 Lakhs ( Previous year - H 75.84 Lakhs). The company also hires equipments on short term contract basis, and has paid H 1,942.30 Lakhs (Previous year - H 1,854.18 Lakhs) against it during the year which is included in other miscellaneous expenses.

Defined Benefit Plan:

a) Gratuity Plan

Every employee who has completed five years or more of service is entitled to gratuity on terms not less favourable than the provisions of the Payment of Gratuity Act, 1972. The present value of defined obligation and related current cost are measured using the Projected Unit Credit Method with actuarial valuation being carried out at Balance Sheet date.

b) Risk Exposure

Defined benefit plans expose the Company to the following types of actuarial risks:

Interest rate risk: The Plan exposes the company to the risk of fall in interest rates . A fall in interest rates will result in an increase in the ultimate cost of providing the above benefit and will thus result in an increase in the value of the liability (as shown in financial statements.)

Liquidity Risk: This is the risk that the company is not able to meet the short term gratuity payouts .This may arise due to non availability of enough cash / cash equivalent to meet the liabilities or holding of liquid assets not being sold in time.

Salary Escalation Risk: The Present value of the defined benefit plan is calculated with the assumption of salary increase rate of plan participate in future . Deviation in the rate of increase of salary in future for plan participant from the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan''s liability.

Demographic risk: The company has used certain mortality and attrition assumption in valuation of the liability . The Company is exposed to the risk of actual experience turning out to be worse compared to the assumption.

Regulatory Risk: Gratuity benefit is paid in accordance with the requirement of the Payment of Gratuity Act, 1972 (as amended from time to time). There is risk of change in regulation requiring higher gratuity payout (e.g. Increase in the maximum limit on gratuity of H 20,00,000).

Asset Liability Mismatching or Market Risk: The duration of the liability is longer compared to duration of assets, exposing the Company to market risk for volatilities/fall in interest rate.

Investment Risk: The probability or likelihood of occurrence of losses relative to the expected return on any particular Investment.

The Gratuity Scheme is invested in policies offered by Life Insurance Corporation (LIC) of India . The information on the allocation of the fund into major asset classes and expected return on each major class are not readily available. The expected rate of return on plan assets is based on market expectations, at the beginning of the period, for returns over the entire life of the related obligation.

i) Asset Liability Matching Strategy

The company has purchased insurance policy which is basically a year on year cash accumulation plan in which the interest rate is declared on yearly basis and is guaranteed for a period of one year. The Insurance company as a part of policy rules makes payment of all gratuity outgoes happening during the year (subject to sufficiency of fund under the policy). The Policy, thus mitigate the liquidity risk. However, being cash accumulation plan the duration of assets shorter compared to the duration of liabilities. Thus the company is exposed to movement in interest rate (in Particular the significant fall in interest rate which should result in a increase in liability without corresponding increase in assets).

k) The company expect to contribute H 266.46 Lakhs (Previous Year - H 355.34 Lakhs) during the next annual reporting Period to gratuity fund.

l) As at 31^st March 2024, the weighted average duration of the defined benefit obligation was 12 years (previous year- 12 years).The distribution of the timing of benefits payment i.e., the maturity analysis of the benefit payments is as follows :

m) Sensitivity Analysis

Significant actuarial assumption for the determination of the defined benefit obligation are discount rate, expected salary increase and mortality. The sensitivity analysis below have been determined based on reasonably possibly changes of the assumption occurring at the end of the reporting period, while holding all other assumption constant.The result of sensitivity assumption is given below:

42. Segment information

The Company is engaged in manufacturing of "Iron and Steel". Consequent to the adoption of IND-AS, the company has identified one operating segment viz, "Iron and Steel", which is consistent with the internal reporting provided to the managing director who is the chief operating decision maker of the company. The information relating to revenue from external customers and location of non-current assets of its single reportable segment has been disclosed as below:

Information about major customers

Total amount of revenues from customers (each exceeding 10% of total revenues of the Company) is H Nil (Previous Year H Nil Lakhs) reported under Iron & Steel segment.

43. Corporate social responsibility

As per Section 135 of the Companies Act, 2013, a company meeting the applicable threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The areas for CSR activities are in accordance to the CSR Policy of the Company which includes Rural Development Project, eradicating hunger, poverty and malnutrition, healthcare and sanitation, animal welfare, etc. A CSR committee has been formed by the Company as per the Act.

Note 1 - Statements are being filed with bankers on the basis of provisional figures since the final figures are made available at a later date. The Company has not claimed Drawing Power(DP) on certain current assets. DP is calculated as per norms of lenders. The terms of the sanction letter limit the amount of advances & Stock of Stores & Spares that can be considered in the Drawing Power calculation for the monthly stock statements.

*This is computed by considering the following :

Inventory Trade Receivables Advances Given to suppliers-Trade Payables-Advances Received from customers

Description of ratios:

(a) Current ratio: Current Assets / Current Liabilities

(b) Debt-equity ratio: Total Debt /Shareholder''s Equity

(c) Debt service coverage ratio: Earning for Debt Service = Net Profit after taxes Non-cash operating expenses like depreciation and other amortizations Interest other adjustments like loss on sale of Fixed assets etc./Debt service = Interest & Lease Payments Long term Principal Repayments

(d) Return on equity ratio: Net Profits after taxes/Average Shareholder''s Equity

(e) Inventory turnover ratio : Sales of Products/ Average inventory =(Opening Closing balance / 2)

(f) Trade receivables turnover ratio : Revenue from Operations/Average trade debtors = (Opening Closing balance / 2)

(g) Trade payables turnover ratio: Purchase of Raw Materials & Stores/Average Trade Payables

(h) Net capital turnover ratio: Revenue from Operations/Working Capital =Working capital shall be calculated as current assets minus current liabilities.

(i) Net profit ratio :Earning before interest and taxes/Capital Employed = Tangible Net Worth Total Debt Deferred Tax Liability

(j) Return on capital employed : Earning before interest and taxes./Capital Employed = Tangible Net Worth Total Debt Deferred Tax Liability

(k) Return on investment: Net gain/(loss) on sale/fair value changes of Equity Instruments/Average Investments

47 Other Statutory Information

(a) The Company has not revalued its Property, Plant and Equipment (including Right-of-Use Assets) and intangible assets during the year.

(b) The Company has not given any loans or advances in the nature of loans either repayable on demand or without specifying any terms or period of repayment granted to promoters, directors, KMPs and related parties.

(c) The Company has not used borrowings for purpose other than specified purpose of the borrowing.

(d) The Company does not have any Benami property. Further, there are no proceedings initiated or are pending against the Company for holding any benami property under the Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder.

(e) The Company does not have transactions with any struck off companies during the current year and previous year.

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

(g) 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:

(i) 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

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

(h) 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:

(i) 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

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

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

(j) The Company has not been declared as a wilful defaulter by any bank or financial institution or government or any government authority.

(k) The company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with Companies (Restriction on number of Layers) Rules, 2017.

48 Miscellaneous Expenses include de-recognition of financial asset (Trade Receivables/Advances/Loan) on account of irrecoverability, the contractual right to receive cash flow from the financial asset of H 31.82 Lakhs (Previous Year -H 17.88 Lakhs).

49 The previous year''s figures have been regrouped, rearranged and reclassified to conform to the classification of the current year, wherever necessary.

50 The financial statements have been approved in Audit Committee meeting held on 29.05.2024 and approved by the Board of Directors on the same day.

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Mar 31, 2023

N. Provisions, Contingent Liabilities & Contingent Assets

The Company recognizes provisions when a present obligation (legal or constructive) as a result of a past event exists and it is probable that an outflow of resources embodying economic benefits will be required to settle such obligation and the amount of such obligation can be reliably estimated.

If the effect of time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.

A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources embodying economic benefits or the amount of such obligation cannot be measured reliably. When there is a possible obligation or a present obligation in respect of which likelihood of outflow of resources embodying economic benefits is remote, no provision or disclosure is made.

Contingent assets usually arise from unplanned or other unexpected events that give rise to the possibility of an inflow of economic benefits. Contingent Assets are not recognized though are disclosed, where an inflow of economic benefits is probable.

O. Cash and Cash Equivalents

Cash and Cash equivalents for the purpose of Cash Flow Statement comprise cash and cheques in hand, bank balances and demand deposits with banks where the original maturity is three months or less.

P. Employee Benefits

Short Term Employee Benefits: All employee benefits payable wholly within twelve months of rendering the service are classified as short-term employee benefits and they are recognized as an expense at the undiscounted amount in the Statement of Profit & Loss of the year in which related service is rendered.

Compensated absences: Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related service are recognized based on actuarial valuation at the present value of the obligation as on the reporting date.

Post-Employment Benefits:

Provident Fund scheme: Retirement benefit in the form of Provident Fund is a defined contribution scheme and the company recognizes contribution payable to the provident fund scheme as expenditure when an employee renders the related service. The Company has no obligations other than the contribution payable to the respective funds.

Gratuity scheme: Gratuity liability, being a defined benefit obligation, is provided for on the basis of an actuarial valuation on projected unit credit method made at the end of each financial year.

Recognition and measurement of Defined Benefit plans: The cost of providing defined benefits is determined using the Projected Unit Credit method with actuarial valuations being carried out at each reporting date. The defined benefit obligations recognized in the Balance Sheet represent the present value of the defined benefit obligations as reduced by the fair value of plan assets, if applicable. Any defined benefit asset (negative defined benefit obligations resulting from this calculation) is recognized representing the present value of available refunds and reductions in future contributions to the plan.

All expenses represented by current service cost, past service cost, if any, and net interest on the defined benefit liability / (asset) are recognized in the Statement of Profit and Loss. Remeasurements of the net defined benefit liability/ (asset) comprising actuarial gains and losses and the return on the plan assets, are recognized in Other Comprehensive Income. Such remeasurements are not reclassified to the Statement of Profit and Loss in the subsequent periods. Re-measurement of defined benefit plans is recognized as a part of retained earnings in statement of changes in equity as per Division II of Schedule III of the Companies Act, 2013.

Q. Leases

The Company as lessor

Lease income from operating leases where the Company is a lessor is recognized in the statement of profit and loss on a straight- line basis over the lease term.

The Company as lessee

The Company assesses whether a contract is or contains a lease, at inception of a contract. The assessment involves the exercise of judgement about whether (i) the contract involves the use of an identified asset, (ii) the Company has substantially all of the economic benefits from the use of the asset through the period of the lease, and (iii) the Company has the right to direct the use of the asset.

The Company recognizes a right-of-use asset ("ROU") and a corresponding lease liability at the lease commencement date. The ROU asset is initially recognized at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives. They are subsequently measured at cost less accumulated depreciation and impairment losses.

The ROU asset is depreciated using the straight line method from the commencement date to the earlier of, the end of the useful life of the ROU asset or the end of the lease term. If a lease transfers ownership of the underlying asset or the cost of the ROU asset reflects that the Company expects to exercise a purchase option, the related ROU asset is depreciated over the useful life of the underlying asset. The estimated useful lives of ROU assets are determined on the same basis as those of property and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain re-measurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company uses an incremental borrowing rate specific to the Company, term and currency of the contract. Generally, the Company uses its incremental borrowing rate as the discount rate.

Lease payments included in the measurement of the lease liability include fixed payments, variable lease payments that depend on an index or a rate known at the commencement date; and extension option payments or purchase options payment which the Company is reasonably certain to exercise.

Variable lease payments that do not depend on an index or rate are not included in the measurement the lease liability and the ROU asset. The related payments are recognized as an expense in the period in which the event or condition that triggers those payments occurs and are included in the line "other expenses" in the statement of profit or loss.

After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made and remeasured (with a corresponding adjustment to the related ROU asset) when there is a change in future lease payments in case of renegotiation, changes of an index or rate or in case of reassessment of options.

Short-term leases and leases of low-value assets:

The Company has elected not to recognize ROU assets and lease liabilities for short term leases as well as low value assets and recognizes the lease payments associated with these leases as an expense on a straight-line basis over the lease term.

R. Borrowing Cost

Borrowing cost includes interest, amortization of ancillary costs incurred in connection with the arrangement of borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost.

Borrowing costs, if any, directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized, if any. All other borrowing costs are expensed in the period in which they occur.

S. Events after Reporting date

Where events occurring after the Balance Sheet date provide evidence of conditions that existed at the end of the reporting period, the impact of such events is adjusted within the financial statements. Otherwise, events after the Balance Sheet date of material size or nature are only disclosed.

T. Research and Development

Expenditure on research is recognized as an expense when it is incurred. Expenditure on development which does not meet the criteria for recognition as an intangible asset is recognized as an expense when it is incurred.

Items of property, plant and equipment and acquired Intangible Assets utilized for Research and Development are capitalized and depreciated in accordance with the policies stated for Property, Plant and Equipment and Intangible Assets.

U. Earnings Per Share

Basic earning per share is calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. For the purpose of calculating diluted earning per share, the net profit or loss for the period attributable to equity shareholders are divided with the weighted average number of shares outstanding during the year after adjustment for the effects of all dilutive potential equity shares.

V. Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker (CODM) of the Company. The CODM is responsible for allocating resources and assessing performance of the operating segments of the Company.

W. Non-Current Assets held for sale

The Company classifies non-current assets as held for sale if their carrying amounts will be recovered principally through a sale rather than through continuing use of the assets and actions required to complete such sale indicate that it is unlikely that significant changes to the plan to sell will be made or that the decision to sell will be withdrawn. Also, such assets are classified as held for sale only if the management expects to complete the sale within one year from the date of classification. On-current assets classified as held for sale are measured at the lower of their carrying amount and the fair value less cost to sell. Non-current assets held for sale are not depreciated or amortized.

X. Rounding Off

All amounts disclosed in the financial statements and notes have been rounded off to the nearest lakhs as per requirement of Schedule III, unless otherwise stated.

2. KEY ACCOUNTING ESTIMATES & JUDGEMENTS:

The preparation of the Company''s financial statements requires the management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below:

2.1. Significant judgments when applying Ind AS 115

Revenue is recognized upon transfer of control of promised products to customers in an amount that reflects the consideration which the Company expects to receive in exchange for those products. Revenue is measured based on the transaction price, which is the consideration, adjusted for volume discounts, price concessions and incentives, if any, as specified in the contract with the customer. The Company exercises judgment in determining whether the performance obligation is satisfied at a point in time or over a period of time. The Company considers indicators such as who controls the asset as it is being created or existence of enforceable right to payment for performance to date and alternate use of such product, transfer of significant risks and rewards to the customer, acceptance of delivery by the customer, etc.

2.2. Useful lives of depreciable assets

Management reviews its estimate of the useful lives of depreciable assets at each reporting date, based on the expected utility of the assets. Uncertainties in these estimates relate to technical and economic obsolescence that may change the utility of plant and equipment.

2.3. Defined benefit obligation

The cost of post-employment benefits is determined using actuarial valuations. The actuarial valuation involves making assumptions about discount rates, expected rate of return on assets, future salary increases and mortality rates. Due to the long term nature of these plans such estimates are subject to significant uncertainty.

2.4. Impairment of financial assets

The impairment provisions for financial assets disclosed are based on assumptions about risk of default and expected loss rates. The Company uses judgment in making these assumptions and selecting the inputs to the impairment calculation, based on the Company''s past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

2.5. Impairment of Investment in Associate/ Joint Venture

The Company uses judgment in making these assumptions and selecting the inputs to the impairment calculation, based on the respective company''s past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

2.6. Income taxes/Deferred Tax

The Company calculates income tax expense based on reported income. Deferred income tax expense is calculated based on the differences between the carrying value of assets and liabilities for financial reporting purposes and their respective tax basis that are considered temporary in nature. Valuation of deferred tax assets is dependent on management''s assessment of future recoverability of the deferred benefit. Expected recoverability may result from expected taxable income in the future, planned transactions or planned tax optimizing measures. Economic conditions may change and lead to a different conclusion regarding recoverability.

2.7. Recoverability of advances/ receivables

At each balance sheet date, based on discussions with the respective counterparties and internal assessment of their credit worthiness, the management assesses the recoverability of outstanding receivables and advances. Such assessment requires significant management judgement based on financial position of the counterparties, market information and other relevant factor.

2.8. Contingent assets and liabilities, uncertain assets and liabilities

Liabilities that are uncertain in timing or amount are recognized when a liability arises from a past event and an outflow of cash or other resources is probable and can be reasonably estimated. Contingent liabilities are possible obligations where a future event will determine whether Company will be required to make a payment to settle the liability, or where the size of the payment cannot be determined reliably. Material contingent liabilities are disclosed unless a future payment is considered remote. Evaluation of uncertain liabilities and contingent liabilities and assets requires judgment and assumptions regarding the probability of realization and the timing and amount, or range of amounts, that may ultimately be incurred. Such estimates may vary from the ultimate outcome as a result of differing interpretations of laws and facts.

Description of nature and purpose of each reserve Securities Premium

This reserve is used to record the premium received on issue of shares. The reserve is utilised in accordance with the provisions of Companies Act, 2013.

Retained Earnings

It comprises of accumulated profit/(losses) of the company.

6% Redeemable Preference Shares

The CCPS was converted to 6% Redeemable Preference Shares under section 48 of the Companies Act, 2013 and the Article 10 of the Articles of Association of the Company which is ratified in writing by holders of atleast 3/4th of nominal value of issued Preference Shares. The company will convert the same into CCPS and subsequently into equity in future.

Equity Component of Optionally Convertible Debenture

This contains the equity portion of the Optionally convertible debentures issued in lieu of long term borrowings as per the terms of the restructuring scheme.

Equity Instruments through Other Comprehensive Income

The Company has elected to recognise changes in the fair value of quoted investments in equity securities in OCI. These changes are accumulated within the FVOCI equity investment reserve within equity. The Company transfers amounts from this reserve to retained earnings when the relevant equity securities are derecognised.

17.1 Terms and conditions attached to Short term borrowings from banks

(a) Cash Credit facilities from banks are secured by first pari-passu charge on the entire current assets (both present & future) and Second pari-passu charge on the entire fixed assets (both present & future) of the company''s manufacturing facilities situated at Jamgaon, Raigarh in the state of Chhattisgarh. Personal guarantee of Puranmal Agrawal, Suresh Kumar Agrawal, Manish Agrawal and Saket Agrawal is given alongwith corporate guarantee of M/s Ilex Pvt Ltd. Corporate Guarantee is restricted to the extent of shares pledged of the promoter group companies. The rate of interest on cash credit is 2.90% above 1 year MCLR.

(b) The Intercorporate loans carry an interest rate of 9.85% p.a (Previous Year - Nil).

17.2 Refer Note No. 45 in the respect of Quarterly Return/Statement filed with the bank in lieu of sanctioned working capital facilities.

18.1 Trade Payables include acceptances and arrangements where operational suppliers of goods and services are paid by banks while the company continues to recognise the liability till settlement with the banks which are normally effected within a period of 90 or 180 days amounting to ''8,867.75 lakhs (previous year ''11,788.91 lakhs).

18.2 Disclosure as required under the Micro, Small and Medium Enterprises Development Act, 2006, to the extent ascertained and as per notification number GSR 679 (E) dated 4th September, 2015.

31. Income Tax (Contd.)

C. The Taxation Laws (Amendment) Ordinance 2019 was promulgated on September 20, 2019. The Ordinance amends the income tax Act 1961 and the Finance Act 2019. The Ordinance provides domestic companies with a non-reversible option to opt for lower tax rates, provided they do not claim certain deductions. The company has evaluated the same and decided to continue with the existing tax structure until utilisation of accumulated minimum alternate tax (MAT), tax incentives and other deductions available to the Company.

34. Financial instruments

This section gives an overview of the significance of financial instruments for the Company and provides additional information on balance sheet items that contain financial instruments. The details of significant accounting policies, including the criteria for recognition, the basis of measurement and the basis on which income and expenses are recognised in respect of each class of financial asset, financial liability and equity instrument are disclosed in Note 1 (G) to the financial statements.

i) Financial assets & liabilities

The following tables presents the carrying value and fair value of each category of financial assets and liabilities as at March 31,2023 and March 31,2022:,

ii) Fair values hierarchy

The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Level 1 to Level 3, as described below:

Quoted prices in an active market (Level 1): This level of hierarchy includes financial assets that are measured by reference to quoted prices (unadjusted) in active markets for identical assets or liabilities. This category consists of investment in quoted equity shares.

Valuation techniques with observable inputs (Level 2): This level of hierarchy includes financial assets and liabilities, measured using inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices). This level of hierarchy includes Company''s over-the-counter (OTC) derivative contracts.

Valuation techniques with significant unobservable inputs (Level 3): This level of hierarchy includes financial assets and liabilities measured using inputs that are not based on observable market data (unobservable inputs). Fair values are determined in whole or in part, using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data.

iii) Valuation process and technique used to determine fair value

Specific valuation techniques used to value financial instruments include:

(a) Quoted investments (Equity Shares)- Market Value

(b) Unquoted Investments - As determined by Independent Valuer. The equity shares of ''4,092.53 Lakhs (31.03.2022 - ''287.98 lakhs) are not listed. Fair value estimates of equity investments are included in level-3 and are based on information relating to value of investee company''s net assets and DCF methods.

(c) The carrying amount of financial assets and financial liabilities measured at amortised cost in the financial statements are a reasonable approximation of their fair values since the Company does not anticipate that the carrying amounts would be significantly different from the values that would eventually be received or settled.

iv) Valuation inputs and relationships to fair value

The following table summarises the quantitative information about the significant unobservable inputs used in level 3

fair value measurements. Refer (iii) (b) above for the valuation techniques adopted.

A) Capital Management

i) Risk Management

The Company''s objectives when managing capital are to

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

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

In order to maintain or adjust the capital structure, the company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. Consistent with others in the industry, the Company monitors capital on the basis of net debt to equity ratio and maturity profile of overall debt portfolio of the Company.

Net debt implies total borrowings of the Company comprises all components attributable to the owners of the Company.

B) Financial Risk Management

The Company''s activities expose it to market risk, liquidity risk and credit risk. In order to minimise any adverse effects on the financial performance of the Company, the company has risk management policies as described below :-

i) Credit risk

Credit risk refers to the risk of financial loss arising from default / failure by the counterparty to meet financial obligations as per the terms of contract. The Company is exposed to credit risk for receivables, cash and cash equivalents. None of the financial instruments of the Company result in material concentration of credit risks.

Customer credit risk is managed by the Company''s established policy, procedures and control relating to customer credit risk management. Outstanding customer receivables are regularly monitored and reconciled. Based on historical trend, industry practice and the business environment in which the company operates, an impairment analysis is performed at each reporting date for trade receivables. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in Note 9.

Credit Risk on cash and cash equivalent, deposits with the banks/financial institutions is generally low as the said deposits have been made with the banks/financial institutions who have been assigned high credit rating by international and domestic rating agencies.

ii) Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at reasonable price. Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of credit facilities to meet obligations when due. The Company''s treasury team is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the Company''s liquidity position through rolling forecasts on the basis of expected cash flows.

Maturities of financial liabilities

The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments.

C) Market Risk (Contd.) ii) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s short term borrowing and long term borrowings with floating interest rates. The Company constantly monitors the credit markets and rebalances its financing strategies to achieve an optimal maturity profile and financing cost.

D) Other Price Risk

Other price risk is the risk that the fair value of a financial instrument will fluctuate due to changes in market traded price. Other price risk arises from financial assets such as investments in equity instruments and bonds. The Company is exposed to price risk arising mainly from investments in equity instruments recognised at FVTOCI.

b) The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributions by the company towards Provident Fund and Gratuity. The Ministry of Labour and Employment has released draft rules for the Code on Social Security, 2020 on November 13, 2020, and has invited suggestions from stakeholders which are under active consideration by the Ministry. 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.

c) Capital Commitment

The capital commitment for the company amounts to '' nil ('' nil).

37. The Company did not raise any term loans or no new working capital borrowings have been sanctioned the current year. Accordingly, the Company does not have any charges to be filed or satisfaction which is yet to be registered with ROC beyond the statutory period.

38. The company has not filed any Scheme of Arrangements in terms of sections 230 to 237 of the Companies Act, 2013 with any Competent Authority.

39. Short Term Leases

The Company''s leasing arrangements are in respect of short term leases for office premises at Kolkata and Raigarh, depot at Raipur & guest houses at Raigarh, Gairkata, Kolkata and Nagpur. These leasing arrangements which are cancellable for period of 11 months and the Company has elected not to recognize ROU assets and lease liabilities for short term leases and recognizes the lease payments associated with these leases as an expense on a straight-line basis over the lease term. The Company has paid lease rentals of ''75.84 Lakhs ( Previous year - ''74.52 Lakhs). The company also hires equipments on short term contract basis, and has paid ''1,854.18 Lakhs (Previous year - ''1,711.31 Lakhs) against it during the year which is included in other manufacturing expenses.

a) Gratuity Plan

Every employee who has completed five years or more of service is entitled to gratuity on terms not less favourable than the provisions of the Payment of Gratuity Act, 1972. The present value of defined obligation and related current cost are measured using the Projected Unit Credit Method with actuarial valuation being carried out at Balance Sheet date.

b) Risk Exposure

Defined benefit plans expose the Company to the following types of actuarial risks:

Interest Rate Risk: The Plan exposes the company to the risk of fall in interest rates. A fall in interest rates will result in an increase in the ultimate cost of providing the above benefit and will thus result in an increase in the value of the liability (as shown in financial statements).

Liquidity Risk: This is the risk that the company is not able to meet the short term gratuity payouts .This may arise due to non availability of enough cash / cash equivalent to meet the liabilities or holding of liquid assets not being sold in time.

Salary Escalation Risk: The Present value of the defined benefit plan is calculated with the assumption of salary increase rate of plan participate in future . Deviation in the rate of increase of salary in future for plan participant from the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan''s liability.

Demographic Risk: The company has used certain mortality and attrition assumption in valuation of the liability. The Company is exposed to the risk of actual experience turning out to be worse compared to the assumption.

Regulatory Risk: Gratuity benefit is paid in accordance with the requirement of the Payment of Gratuity Act, 1972 (as amended from time to time). There is risk of change in regulation requiring higher gratuity payout (e.g. Increase in the maximum limit on gratuity of '' 20,00,000).

Asset Liability Mismatching or Market Risk: The duration of the liability is longer compared to duration of assets, exposing the Company to market risk for volatilities/fall in interest rate.

Investment Risk: The probability or likelihood of occurrence of losses relative to the expected return on any particular Investment.

i) Asset Liability Matching Strategy

The company has purchased insurance policy which is basically a year on year cash accumulation plan in which the interest rate is declared on yearly basis and is guaranteed for a period of one year. The Insurance company as a part of policy rules makes payment of all gratuity outgoes happening during the year (subject to sufficiency of fund under the policy). The Policy, thus mitigate the liquidity risk. However, being cash accumulation plan the duration of assets shorter compared to the duration of liabilities. Thus the company is exposed to movement in interest rate (in Particular the significant fall in interest rate which should result in a increase in liability without corresponding increase in assets).

42. Segment information

The Company is engaged in manufacturing of "Iron and Steel". Consequent to the adoption of IND-AS, the company has identified one operating segment viz, "Iron and Steel", which is consistent with the internal reporting provided to the managing director who is the chief operating decision maker of the company.

The information relating to revenue from external customers and location of non-current assets of its single reportable segment has been disclosed as below:

Information about major customers

Total amount of revenues from customers (each exceeding 10% of total revenues of the Company) is '' Nil (Previous Year '' Nil Lakhs) reported under Iron & Steel segment.

43. Corporate social responsibility

As per Section 135 of the Companies Act, 2013, a company meeting the applicable threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The areas for CSR activities are in accordance to the CSR Policy of the Company which includes Rural Development Project, eradicating hunger, poverty and malnutrition, healthcare and sanitation, animal welfare, etc. A CSR committee has been formed by the Company as per the Act.

Description of ratios:

(a) Current ratio: Current Assets / Current Liabilities

(b) Debt-equity ratio: Total Debt /Shareholder''s Equity

(c) Debt service coverage ratio: Earning for Debt Service = Net Profit after taxes Non-cash operating expenses like depreciation and other amortizations Interest other adjustments like loss on sale of Fixed assets etc./Debt service = Interest & Lease Payments Long term Principal Repayments

(d) Return on equity ratio: Net Profits after taxes/Average Shareholder''s Equity

(e) Inventory turnover ratio: Sales of Products/ Average inventory =(Opening Closing balance / 2)

(f) Trade receivables turnover ratio: Revenue from Operations/Average trade debtors = (Opening Closing balance / 2)

(g) Trade payables turnover ratio: Purchase of Raw Materials & Stores/Average Trade Payables

(h) Net capital turnover ratio: Revenue from Operations/Working Capital =Working capital shall be calculated as current assets minus current liabilities.

(i) Net profit ratio: Earning before interest and taxes/Capital Employed = Tangible Net Worth Total Debt Deferred Tax Liability

(j) Return on capital employed: Earning before interest and taxes./Capital Employed = Tangible Net Worth Total Debt Deferred Tax Liability

(k) Return on investment: Net gain/(loss) on sale/fair value changes of Equity Instruments/Average Investments

Other Statutory Information

(a) The Company has not revalued its Property, Plant and Equipment (including Right-of-Use Assets) and intangible assets during the year.

(b) The Company has not given any loans or advances in the nature of loans either repayable on demand or without specifying any terms or period of repayment granted to promoters, directors, KMPs and related parties.

(c) The Company has not used borrowings for purpose other than specified purpose of the borrowing.

47. Other Statutory Information (Contd.)

(d) The Company does not have any Benami property. Further, there are no proceedings initiated or are pending against the Company for holding any benami property under the Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder.

(e) The Company does not have transactions with any struck off companies during the current year and previous year.

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

(g) 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:

(i) 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

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

(h) 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:

(i) 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

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

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

(j) The Company has not been declared as a wilful defaulter by any bank or financial institution or government or any government authority.

(k) The company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with Companies (Restriction on number of Layers) Rules, 2017.

48. Miscellaneous Expenses include de-recognition of financial asset (Trade Receivables/Advances/Loan) on account of irrecoverability, the contractual right to receive cash flow from the financial asset of ''17.88 Lakhs (Previous Year - ''22.58 Lakhs).

49. The previous year''s figures have been regrouped, rearranged and reclassified to conform to the classification of the current year, wherever necessary.

50. The financial statements have been approved in Audit Committee meeting held on 29.05.2023 and approved by the Board of Directors on the same day.

As per our report of even date: For and behalf of Board of Directors

For S K Agrawal and Co Chartered Accountants LLP

Firm Registration No.-306033E/E300272 Chartered Accountants

Suresh Kumar Agrawal Saket Agrawal

Chairman Managing Director

DIN - 00587623 DIN - 00129209

J K Choudhury Kamal Kumar Jain Shreya Kar

Partner Chief Financial Officer Company Secretary

Membership No.-009367 Mem No. A41041

Place: Kolkata Date: 29th May, 2023

---

Mar 31, 2016

Terms/ rights attached to Equity Shares

The company has only one class of Equity Shares having a nominal value of Rs. 10/- per share. Each holder of Equity Shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

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

Terms/ rights attached to Preference Shares

The company has only one class of Preference Shares (i.e. 6% Non Cumulative Redeemable Preference Shares) having a nominal value of ''10/- per share. The preference shareholders shall have the right to vote on any resolution of the Company directly affecting their rights. The company declares and pays preferential dividends in Indian rupees.

The Preference Share of the Company are non cumulative in nature and therefore in case the Company does not declare dividend in any particular year, dividend right gets lapsed and is not eligible for carry forward in future years.

Preference shares are redeemable within 20 years from the date of allotment at a price to be decided by the Board of Directors at the time of redemption. The said preference shares may be redeemed at a premium not exceeding Rs. 90/per share.

In the event of liquidation of the Company, the holders of Preference Shares will be entitled to receive assets of the company, before its distribution to equity shareholders. The distribution will be in proportion to the number of preference shares held by the preference shareholders.

* During the year, as per the requirement under Schedule II to the Companies Act 2013, vide Notification dated 29^th August 2014, the Company based on technical advice identified significant parts & components of the main asset having different useful lives as compared to the main asset and consequently revised the estimated useful lives of certain Plant and Machinery and Electrical Installations w.e.f. from 1^st April 2015. Accordingly depreciation of Rs. 26.46 lacs on account of assets whose useful life is already exhausted on 1^st April, 2015 has been adjusted against Surplus in statement in Profit and Loss.

Terms and conditions attached to Short term borrowings

Cash Credit and Short term loan facilities and Foreign currency loans from banks are secured by hypothecation of raw materials, finished goods, goods under process, stores and spares, book debts etc. (both present and future), second charge over the entire fixed assets of the Company and personal guarantees of Puran Mal Agrawal (Chairman²), Suresh Kumar Agrawal, Saket Agrawal and Manish Agrawal (Directors of the Company).

c) Depreciation of'' 26.46 lacs on account of assets whose useful life is already exhausted on 1 st April, 2015 has been adjusted against surplus in Statement of Profit and Loss. Pursuant to requirements under Schedule II to companies act, 2013 vide Notification dated 29th August 2014, the Company based on technical advice, identified significant parts & components of the main asset having different useful lives as compared to the main asset and consequently revised the estimated useful lives of certain Plant and Machinery and Electrical Installations w.e.f from 1st April, 2015.

* Includes Rs. 4,949.90 lacs (Rs. 18,017.01 lacs) capitalized from Capital Work in progress (CWIP)

** Represents the amount of borrowing cost transferred from CWIP

* The details of security for the secured loans are as follows:

In terms of the Corporate Debt Restructuring (CDR) Package, effective from October 1, 2014, the Loans considered under the said package have been categorized as Term Loans, Working Capital Term Loans, Funded Interest Term Loans which are secured as under:

a First hypothecation charge on plant, machinery, fixed assets, and other movable assets, both present and future of the company, on pari-passu basis with all term lenders and equitable mortgage of factory land & building on pari passu basis with all Term Lenders.

b Second charge on entire current assets of the company ranking pari passu with other member banks of the consortium. c Pledge of 100% of Promoter''s Shareholding representing 71.90% of the paid up capital of the company as on 30.09.2014 has been executed in favour of the CDR lenders. d Lien on all Bank Accounts including the Trust and Retention Account.

Further, the above facilities are also covered by the following:

Irrevocable, unconditional personal guarantee of promoters (Mr. Puran Mal Agrawal, Mr. Suresh Kumar Agrawal, Mr. Saket Agrawal, and Mr. Manish Agrawal) of the Company.

Registered mortgage of 150.50 acres of segregated agricultural land. As per valuation report of December 2014, realizable value of the property is Rs. 12.41 Crores. The said land shall be converted into industrial land by 31.03.2016 failing which alternate security will be provided by the Company.

Irrevocable, unconditional Corporate Guarantee of Ilex Private Limited.

** Hire purchases obligations are secured by hypothecation of vehicles purchased under the respective agreements.

** The Hon''ble High Court of Judicature at Madras, vide its Order dated June 25, 2015, has sanctioned the Scheme of Arrangement among IDFC Limited (" Transferor Company") and IDFC Bank Limited ("Transferee Company") and their respective shareholders and creditors under section 391 to 394 to the Companies Act, 1956 (" Demerger Scheme").

Pursuant to the Demerger Scheme, IDFC Bank Limited has issued and alloted to the shareholders of IDFC Limited as on the record date i.e., October 5, 2015, one (1) equity share having a face value of '' 10 each of IDFC Bank Limited for every one (1) equity share held by them in IDFC Limited, each equity share being fully paid-up.

* Fixed deposits with a carrying amount of Rs. 285.93 lacs (Rs. 189.73 lacs) are used towards security given against the Bank Guarantees & Company''s Letter of Credits (LC''s) issued by the banks and Rs. 5.74 lacs (Rs. 5.74 lacs) as security deposit issued to sales tax department on behalf of the Company.

1. Other Expenses include Rs. 129.97 Lacs spent towards various schemes of Corporate Social Responsibility as prescribed under section 135 of Companies Act,2013.

2. Gratuity and Other Post Retirement Benefit Plans

The Company provides gratuity benefits which are funded with Life Insurance Corporation of India in the form of qualifying insurance policy. Leave encashment benefits is an unfunded plan of the Company.

The estimate of future salary increase, considered in actuarial valuation, takes account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employee market.

3. Segment Information

The Company is engaged in manufacturing of "Iron and Steel". Consequently it has one reportable business segment e.g. "Iron and Steel". The analysis of geographical segments is based on the area in which the customers of the Company are located.

The Company has common fixed assets for producing goods for domestic and overseas markets which are located at only one place i.e. Raigarh. Hence, separate figures for fixed assets / additions to fixed assets cannot be furnished. Export debtors at the year end amounts to Rs. 846.82 lacs (Rs. 176.49 lacs).

4. Operating Lease Company as Lessee

The Company has lease agreement for various premises which are in the nature of Operating Lease. There are no restrictions placed upon the company by entering into these leases.

5. Interest in Joint Venture

The Company has a 14.90 % (14.90%) interest in Madanpur South Coal Company Limited (a Joint Venture Company), incorporated in India.

The Company''s proportionate share of the capital commitments in this Joint Venture amounts to '' Nil ('' Nil).

6. Impairment of Assets

On the basis of physical verification of assets and cash generation capacity of those assets, in the management perception, there is no impairment of assets as on 31st March 2016.

It is not practicable for the Company to estimate the timings of cash outflows, if any, in respect of the above pending resolution of the respective proceedings as it is determinable only on receipt of judgments/decisions pending with various forums/authorities.

There is no possibility of any reimbursement on any of the cases listed above

* The Company has given guarantee to ICICI Bank in respect of loan taken by AA ESS Tradelinks Private Limited amounting to Rs. 7,500 lacs (Rs. 7,500 lacs) on 31st May 2011. The management believes that the terms of the guarantee given are not prejudicial to the interest of the Company.

7. Valuation of Current Assets, Loans & Advances and Current Liabilities

In the opinion of the management, current assets (including trade receivables), loans and advances and current liabilities (including trade payables) have the value at which these are stated in the Balance Sheet, unless otherwise stated, and adequate provisions for all known liabilities have been made and are not in excess of the amount reasonably required.

8. As per information available with the Company, there are no suppliers covered under "Micro, Small and Medium Enterprise Development Act, 2006". As a result, no interest provision/payment has been made by the Company to such creditors, if any, and no disclosure thereof is made in the accounts.

9. The amount due from related parties are good and hence no provision for doubtful debts in respect of dues from such related parties is required. No amount has been written back / written off during the year in respect of due to / from related parties.

10. The Company has a process whereby periodically all long term contracts (including derivative contracts) are assessed for material foreseeable losses. At the year end, the Company has reviewed and ensured that adequate provision as required under any law/accounting standards for material foreseeable losses on such long term contracts (including derivative contracts) has been made in the books of accounts.

11. The previous year''s figures have been reworked, regrouped, rearranged and reclassified wherever necessary. Amounts and other disclosures for the preceding year are included as an integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year. Bifurcation of assets and liabilities into Non-Current and Current for preparation of financial statements has been made by the management.

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Mar 31, 2015

1. Corporate Information

MSP Steel & Power Limited ('the Company') is a public company domiciled in India and is listed on the BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE). The Company is engaged in the manufacture and sale of iron and steel products and generation and sale of power. The Company has manufacturing plant in Raigarh, Chhattisgarh.

Terms/Rights attached to Equity Shares

The company has only one class of Equity Shares having a nominal value of Rs. 10/- per share. Each holder of Equity Shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

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

Terms/Rights attached to Preference Shares

The company has only one class of Preference Shares (i.e. 6% Non Cumulative Redeemable Preference Shares)

having a nominal value of Rs. 10/- per share. The Preference Shareholders shall have the right to vote on any resolution of the company directly affecting their rights. The company declares and pays preferential dividends in Indian rupees.

The Preference Share of the company are Non Cumulative in nature and therefore in case the company does not declare dividend in any particular year, dividend right gets lapsed and is not eligible for carry forward in future years.

Preference Shares are redeemable within 20 years from the date of allotment at a price to be decided by the Board of Directors at the time of redemption.

In the event of liquidation of the company, the holders of Preference Shares will be entitled to receive assets of the company, before its distribution to equity shareholders. The distribution will be in proportion to the number of Preference Shares held by the preference shareholders.

Terms and Conditions attached to Short Term Borrowings

Cash Credit and Short Term Loan facilities and Foreign Currency Loans from Banks are secured by hypothecation charge of entire current assets of the company both present and future on pari passu basis with other consortium member banks, second charge on the entire fixed assets of the Company ranking pari passu with other member banks of the consortium and personal guarantees of Puran Mal Agrawal, Suresh Kumar Agrawal, Saket Agrawal and Manish Agrawal (Promoters of the Company).

*The details of Secured loans are as follows:

In terms of the Corporate Debt Restructuring (CDR) Package, effective from October 1, 2014, the Loans considered under the said package have been categorised as Term Loans, Working Capital Term Loans, Funded Interest Term Loans which are secured as under :

a. First hypothecation charge on plant, machinery, fixed assets, and other movable assets, both present and future of the company, on pari-passu basis with all term lenders and equitable mortgage of factory land & building on pari passu basis with all Term Lenders.

b. Second charge on entire current assets of the company ranking pari passu with other member banks of the consortium.

c. Pledge of 100% of Promoter's Shareholding representing 71.90% of the paid up capital of the company as on 30.09.2014 has been executed in favour of the CDR lenders.

d. Lien on all Bank Accounts including the Trust and Retention Account.

Further, the above facilities are also covered by the following:

Irrevocable, unconditional personal guarantee of promoters (Mr. Puran Mal Agrawal, Mr. Suresh Kumar Agrawal, Mr. Saket Agrawal, and Mr. Manish Agrawal) of the Company.

Registered mortgage of 150.50 acres of segregated agricultural land. As per valuation report of December 2014, realisable value of the property is Rs. 12.41 Crores. The said land shall be converted into industrial land by 31.03.2016 failing which alternate security will be provided by the Company.

Irrevocable, unconditional Corporate Guarantee of M/s. Ilex Private Limited.

**Hire Purchase obligations are secured by hypothecation of vehicles purchsed under the respective agreement.

2. Other expenses include Rs. 135.36 lacs spent towards various schemes of Corporate Social Responsibility as prescribed under section 135 of the Companies Act, 2013.

3. Gratuity and Other Post Retirement Benefit Plans

The Company provides gratuity benefits which are funded with Life Insurance Corporation of India in the form of qualifying insurance policy. Leave encashment benefits is an unfunded plan of the Company.

Expenses recognized in the statement of profit and loss / Pre-operative and Trial run expenses (Pending allocation) for respective years are as follows: —

4. Segment Information

The Company is engaged in manufacturing of "Iron and Steel". Consequently it has one reportable business segment e.g. "Iron and Steel". The analysis of geographical segments is based on the area in which the customers of the Company are located.

The Company has common fixed assets for producing goods for domestic and overseas markets which are located at only one place i.e. Raigarh. Hence, separate figures for fixed assets / additions to fixed assets cannot be furnished. Export debtors at the year end amounts to Rs. 176.49 lacs (Rs. 974.74 lacs).

5. Operating Lease Company as Lessee

The Company has lease agreement for various premises which are in the nature of Operating Lease. There are no restric- tions placed upon the company by entering into these leases.

6. Impairment of Assets

On the basis of physical verification of assets and cash generation capacity of those assets, in the management perception, there is no impairment of assets as on 31st March 2015.

7. Contingent Liabilities not Provided for in Respect of:

(Rs. in lacs) As at As at Particulars 31st March, 31st March, 2015 2014

Excise Matters under dispute/ appeal 2,103.52 1,890.97

Sales Tax & VAT Matters under dispute/ appeal 400.28 130.14

Income Tax Matters under dispute/ appeal 0.55 0.55

CDR Related Liability (Right to Recompense) 278.01 -

Corporate Guarantees given* 2,812.50 4,879.42

It is not practicable for the Company to estimate the timings of cash outflows, if any, in respect of the above pending resolution of the respective proceedings as it is determinable only on receipt of judgements/decisions pending with various forums/authorities.

There is no possibility of any reimbursement on any of the cases listed above

*The Company has given guarantee to ICICI Bank in respect of loan taken by AA ESS Tradelinks Private Limited amounting to Rs. 7500 lacs (Rs. 7500 lacs) on 31st May 2011. The management believes that the terms of the guartantee given are not prejudicial to the interest of the Company.

8. Corporate debt restructuring:

1. MSP Steel & Power Limited (MSPL), as the borrower has availed various financial facilities from the secured lenders. At the request of the Borrower, the Corporate Debt Restructuring Proposal ( Proposal') of the Borrower was referred to Corporate Debt Restructuring Cell ("CDR Cell") by the consortium of senior lenders led by the State Bank of India (Monitoring Institution). The CDR Proposal as recommended by State Bank of India, the lead lender and approved by lenders who are members of CDR Cell hereinafter referred to as the 'CDR Lenders' was approved by CDR Empowered Group ('CDR EG') on March 18, 2015 and communicated vide Letter of Approval dated March 23, 2015, as amended/ modified time to time. The cutoff date for CDR Proposal was October 01, 2014. The Master Restructuring Agreement ('MRA') between the Borrowers and the CDR Lenders has been executed, by virtue of which the restructured facilities are governed by the provisions specified in the MRA having cutoff date of October 01, 2014.

2. The key features of the CDR Proposal are as follows:

a. Repayment of Restructured Term Loans of Rs. 502.98 Crores ( 'RTL') after moratorium of 8 quarters from cutoff date in 32 structured quarterly ballooning instalments commencing from December 2016 to September 2024.

b. Conversion of various irregular portions of Working Capital Limits of Rs.149.72 Crores into Working Capital Term Loan ('WCTL-I'). Repayment of WCTL-I after moratorium of 8 quarters from cutoff date in 32 structured quarterly ballooning instalments commencing from December 2016 to September 2024.

c. Conversion of devolved financial facilities of Rs. 63.13 Crores into Working Capital Term Loan ('WCTL-II'). Repayment of WCTL-II after moratorium of 8 quarters from cutoff date in 32 structured quarterly ballooning instalments commencing from December 2016 to September 2024.

d. Restructuring of existing fund based and non fund based financial facilities, subject to renewal and reassessment every year

e. Interest accrued but not paid on various financial facilities till cutoff date (i.e., 1st October, 2014) shall be converted into Funded Interest Term Loan ('FITL'). The interest payable on RTL, WCTL-I and WCTL-II during moratorium period of 8 quarters from cutoff date also shall be converted to FITL. The repayment of FITL of Rs. 161.52 Crores should be made in 24 structured quaterly ballooning instalments commencing from December 2016 to September 2022.

f. Waiver of existing events of defaults, penal interest and charges etc in accordance with MRA

g. Lenders with the approval of CDR EG shall have the right to recompense the reliefs/ sacrifices/waivers extended by the respective CDR lenders as per CDR Guidelines.

h. Contribution of Rs. 28.14 Crores in the Company by promoters in lieu of bank sacrifice in the form of share application/ unsecured loans which needs to be converted into equity shares/preference shares latest by 30.09.2015.

3. In case of financial facilities availed from the non-CDR Lenders, the terms and conditions shall continue to be governed by the provisions of the existing financing documents.

4. The Borrowers and the CDR Lenders executed a MRA during the year. The MRA as well as the provisions of the Master Circular on Corporate Debt Restructuring issued by the Reserve Bank of India, give a right to the CDR Lenders to get a recompense of their waivers and sacrifices made as part of the CDR Proposal. The recompense payable by the borrowers is contingent on various factors including improved performance of the borrowers and many other conditions, the outcome of which currently is materially uncertain and hence the proportionate amount payable as recompense has been treated as a contingent liability. The aggregate present value of the outstanding sacrifice made/ to be made by CDR Lenders as per the MRA is approximately Rs. 112.57 Crores for the Company.

9. Valuation of Current Assets, Loans & Advances and Current Liabilities

In the opinion of the management, current assets (including trade receivables), loans and advances and current liabilities (including trade payables) have the value at which these are stated in the Balance Sheet, unless otherwise stated, and adequate provisions for all known liabilities have been made and are not in excess of the amount reasonably required.

10. As per information available with the Company, there are no suppliers covered under "Micro, Small and Medium Enterprise Development Act, 2006". As a result, no interest provision/payment has been made by the Company to such creditors, if any, and no disclosure thereof is made in the accounts.

11. The amount due from related parties are good and hence no provision for doubtful debts in respect of dues from such related parties is required. No amount has been written back / written off during the year in respect of due to / from related parties.

12. The Company has a process whereby periodically all long term contracts (including derivative contracts) are assessed for material foreseeable losses. At the year end, the Company has reviewed and ensured that adequate provision as required under any law/accounting standards for material foreseeable losses on such long term contracts (including derivative contracts) has been made in the books of accounts.

13. The previous year's figures have been reworked, regrouped, rearranged and reclassified wherever necessary. Amounts and other disclosures for the preceding year are included as an integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year. Bifurcation of assets and liabilities into Non-Current and Current for preparation of financial statements has been made by the management.

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Mar 31, 2013

NOTE 1. CORPORATE INFORMATION

MSP Steel & Power Limited (''the Company'') is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on two stock exchanges in India. The Company is engaged in the manufacture and sale of iron and steel products and generation and sale of-power.

NOTE 2. GRATUITY AND OTHER POST RETIREMENT BENEFIT PLANS

The Company provides gratuity benefits which are funded with Life Insurance Corporation of India in the form of qualifying insurance policy. Leave encashment benefits is an unfunded plan of the Company.

Expenses recognised in the statement of profit and loss/Pre-operative and Trial run expenses (Pending allocation) for respective years are as follows: - Amount of expenses incurred for the current and previous years are as follows:

The estimate of future salary increase, considered in actuarial valuation, takes account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employee market.

The amount provided for defined contribution plan are as follows:

NOTE 3. SEGMENT INFORMATION

The Company is engaged in manufacturing of "Iron and Steel". Consequently it has one reportable business segment e.g. "Iron and Steel". The analysis of geographical segments is based on the area in which the customers of the Company are located.

Information for Secondary Geographical Segments

The Company has common fixed assets for producing goods for domestic and overseas markets which are located at only one place i.e. Raigarh. Hence, separate figures for fixed assets/additions to fixed assets cannot be furnished. Export debtors at the year end amounts to Rs. 104.04 lacs (Rs. 62.01 lacs).

NOTE 4. INTEREST IN JOINT VENTURE

The Company has a 14.90 % interest in Madanpur South Coal Company Limited (a Joint Venture Company), incorporated in India.

The Company''s share of the assets and liabilities of the above jointly controlled entity as at the respective Balance Sheet dates is as follows:

NOTE 5. IMPAIRMENT OF ASSETS

On the basis of physical verification of assets and cash generation capacity of those assets, in the management perception, there is no impairment of assets as on 31st March, 2013.

There is no possibility of any reimbursement on any of the cases listed above

*The Company has given guarantee to ICICI Bank in respect of loan taken by AA ESS Tradelinks Private Limited amounting to Rs. 7,500 lacs (Rs. 7,500 lacs) on 31st May, 2011. The management believes that the terms of the guartantee given are not prejudicial to the interest of the Company.

NOTE 43. There has been a delay in payment of dividend on preference s hares during the year, and the same has been paid out of its regular bank account without opening a separate dividend account, as required in terms of Section 205 & 205A of the Companies Act, 1956.

NOTE 6. VALUATION OF CURRENT ASSETS, LOANS & ADVANCES AND CURRENT LIABILITIES

In the opinion of the management, current assets (including trade receivables), loans and advances and current liabilities (including trade payables) have the value at which these are stated in the Balance Sheet, unless otherwise stated, and adequate provisions for all known liabilities have been made and are not in excess of the amount reasonably required.

NOTE 7. As per information available with the Company, there are no suppliers covered under Micro, Small and Medium Enterprise Development Act, 2*06. As a result, no interest provision/payment has been made by the Company to such creditors, if any, and no disclosure thereof is made in the accounts.

NOTE 8. During the year, the Company has abandoned its sponge iron project (kiln 4) and extension of railway siding project, as a result of which the already capitalised borrowing costs and other expenses of Rs. 795.39 lacs and Rs. 107.43 lacs respectively upto 31st March, 2012 in respect of these projects has been charged off in the Statement of the Profit and Loss. The remaining expenditure/materials in respect of these projects have alternate use in Company''s other projects and as such, the management is of the opinion that there is no value loss / impairment on the remaining amount.

NOTE 9. The previous year''s figures have been reworked, regrouped, rearranged and reclassified wherever necessary as per the Revised Schedule VI to the Companies Act, 1956. Amounts and other disclosures for the preceding year are included as an integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year.

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Mar 31, 2012

1. Corporate information

MSP Steel & Power Limited is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on two stock exchanges in India. The company is engaged in the manufacture and sale of iron and steel products and generation and sale of power.

terms/ rights attached to equity shares

The Company has only one class of equity shares having a nominal value of Rs. 10/- per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

During the year ended 31st March, 2012, the dividend per share recognised as proposed distributions to equity shareholders is Rs. 0.25 (31st March, 2011: Rs. 0.50).

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

terms/rights attached to preference shares

The Company has only one class of preference shares (i.e. 6% non cumulative redeemable preference shares) having a nominal value of Rs. 10/- per share. The preference shareholders shall have the right to vote on any resolution of the Company directly affecting their rights. The Company declares and pays preferential dividends in Indian rupees.

The preference share of the Company are non cumulative in nature and therefore in case the Company does not declare dividend in any particular year, dividend right gets lapsed and is not eligible for carry forward in future years.

During the year, the Company has issued 1,254,000 (31st March, 201 1: 7,540,000) numbers of preference shares of Rs. 10 each in the same class with a premium of Rs. 90 per share on private placement basis.

During the year ended 31st March, 2012, the dividend per share recognised as proposed distributions to preference shareholders is Rs. 0.60 (31st March, 2011: Rs. 0.60).

Preference shares are redeemable within 20 years from the date of allotment at a price to be decided by the Board of Directors at the time of redemption.

In the event of liquidation of the Company, the holders of preference shares will be entitled to receive assets of the Company, before its distribution to equity shareholders. The distribution will be in proportion to the number of preference shares held by the preference shareholders.

NOTE 2. SHARE APPLICATION MONEY PENDING ALLOTMENT

Terms and Conditions relating to Share Application Money pending allotment

a. The Company has issued a special notice dated 31st March, 2012 to its shareholders in terms of section 192 (A) of the Companies Act 1956, read with Company (Passing of the Resolution by the Postal Ballot) Rules 2011, proposing to issue 10,000,000 equity shares to promoter and non-promoter group on preferential basis in accordance with Chapter VII of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 (the 'SEBI ICDR Regulations') through postal ballot. Out of the total proposed shares to be issued, the Company has received share application money against 5,301,667 equity shares considering the proposed issue price of Rs. 60/- each (including a premium of Rs. 50/- per share).

b. The Company expects to allot the proposed equity shares before July 2012.

c. The Equity Shares to be allotted on preferential basis at a price of Rs. 60/- (including a premium of Rs. 50/- per share) or the price as determined in accordance with SEBI (Issue of Capital and Disclosure Requirements) Regulations 2009 whichever is higher and on such terms and conditions as may be decided and deemed appropriate by the board at its sole and absolute discretion.

d. The Equity shares so issued and allotted shall rank pari passu in all respects with the existing Equity Shares of the company. The Equity Shares so issued and allotted shall be listed and traded on all the Stock Exchanges on which the existing equity shares of the Company are Listed.

e. The Company has sufficient authorised share capital to cover the share capital amount on allotment of shares out of aforesaid share application money.

Nature of security:

* Rupee Term Loans from Banks are secured by way of equitable mortgage of Company's land and immovable properties at Raigarh, first charge by way of hypothecation of the Company's movable assets (save and except book debts) including movable machinery, machinery spares, tools and accessories, (both present and future), second charge over entire current assets of the company , (both present and future), on pari passu basis. The term loans are further secured by the personal guarantees of Puranmal Agrawal (the Chairman), Suresh Kumar Agrawal, Saket Agrawal and Manish Agrawal (Directors of the Company).

** Foreign Currency Loans from Banks are secured by way of equitable mortgage of Company's land and immovable properties at Raigarh, first charge by way of hypothecation of the Company's movable assets (save and except book debts) including movable machinery, machinery spares, tools and accessories, (both present and future), second charge over entire current assets of the company, (both present and future), on pari passu basis. The term loans are further secured by the personal guarantees of Puranmal Agrawal (the Chairman), Suresh Kumar Agrawal, Saket Agrawal and Manish Agrawal (Directors of the Company).

*** Hire purchases obligations are secured by hypothecation of vehicles purchased under the respective agreements.

Terms and conditions attached to Short term borrowings

Cash Credit and other working capital facilities and Foreign currency loans from banks are secured by hypothecation of raw materials, finished goods, goods under process, stores and spares, book debts etc. (both present and future), second charge over the entire fixed assets of the Company and personal guarantees of Puranmal Agrawal (the Chairman), Suresh Kumar Agrawal, Saket Agrawal and Manish Agrawal (Directors of the Company).

Working Capital loan from Body Corporates is secured by personal guarantees of Puranmal Agrawal (the Chairman) and Suresh Kumar Agrawal (Director of the Company) and Subservient charge on all moveable assets including stock and debtors.

* Includes 2,000 Shares held in the name of a Director on behalf of the Company.

# 66,960 Shares pledged with IDBI Bank Limited for guarantee given on behalf of the investee Company ** Wholly owned subsidiary of the Company w.e.f. 31st August, 2011

*** Subsidiary of the Company w.e.f July 08, 2011

note 3. gratuity and other post retirement benefit plans

The Company provides gratuity benefits which are funded with Life Insurance Corporation of India in the form of qualifying insurance policy. Leave encashment benefits is an unfunded plan of the Company.

The estimate of future salary increase, considered in actuarial valuation, takes account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employee market.

The Company expects to contribute Rs. 177.60 lacs (Rs. 148.00 lacs) to gratuity fund in the year 2012-13.

NOTE 4. INTEREST IN JOINT VENTuRE

The Company has a 14.90 % interest in Madanpur South Coal Company Limited (a Joint Venture Company), incorporated in India.

The Company's share of the assets and liabilities of the above jointly controlled entity as at the respective Balance Sheet dates is as follows: -

NOTE 5. SEGMENT INFORMATION

The Company is engaged in manufacturing of "Iron and Steel". Consequently it has one reportable business segment e.g. "Iron and Steel". The analysis of geographical segments is based on the area in which the customers of the Company are located.

The Company has common fixed assets for producing goods for domestic and overseas markets which are located at only one place i.e. Raigarh. Hence, separate figures for fixed assets / additions to fixed assets cannot be furnished. Export debtors at the year end amounts to Rs. 62.01 lacs (Rs. 306.65 lacs).

There is no possibility of any reimbursement on any of the cases listed above

*The Company has given guarantee to ICICI Bank in respect of loan taken by AA ESS Tradelinks Private Limited (became subsidiary of the Company w.e.f. 8th July, 2011) amounting to Rs. 7,500 lacs (Nil) on 31st May, 2011. The management believes that the terms of the guartantee given are not prejudicial to the interest of the Company as it will derive future economic benefits from the subsidiary.

In October 2010, search and seizure operations were conducted by the Income Tax authorities under Section 132 of the Income Tax Act, at various locations of the Company. During the course of the search and seizure operations, the income tax authorities have taken custody of certain materials such as documents, records, and recorded statements of certain officials of the Company. The Company does not expect any liability arising out of the aforesaid search and seizure.

note 6. operating lease company as lessee

The Company has entered into commercial leases on certain office spaces. There are no restrictions placed upon the company by entering into these leases.

note 7

The Company has during the year made purchases of Rs. 51.29 lacs from and sales of Rs. 48.69 lacs to certain parties falling within the purview of Section 297 of the Companies Act, 1956 for which, the Company is in the process of obtaining the required approval from the Central Government.

note 8

As per information available with the Company, there are no suppliers covered under Micro, Small and Medium Enterprise Development Act, 2006. As a result, no interest provision/ payment has been made by the Company to such creditors, if any, and no disclosure thereof is made in the accounts.

note 9

Till the year ended 31st March, 2011, the Company was using pre-revised Schedule VI to the Companies Act 1956, for preparation and presentation of its financial statements. During the year ended 31st March, 2012, the revised Schedule VI notified under the Companies Act 1956, has become applicable to the Company. The Company has reclassified previous year figures to conform to this year's classification. The adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statements. However, it significantly impacts presentation and disclosures made in the financial statements, particularly presentation of balance sheet.

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Mar 31, 2011

Nature of Operations:

MSP Steel & Power Limited is engaged in the manufacture and sale of iron & steel products and generation and sale of power

1. Contingent liabilities not provided for in respect of:

(Rs. in lacs)

Particulars As at As at 31st March, 2011 31st March, 2010

a) Excise Matters under dispute/ appeal 1,391.35 392.96

b) Sales Tax Matters under dispute/ appeal 85.86 34.20

c) Un-expired Bank Guarantees and Letters of Credit 1,200.44 603.74

d) Corporate guarantee given for a joint venture company 660.75 660.75

e) Custom duty on import of equipments and spare parts under EPCG scheme. 2,113.51 1,240.43

f) Claims against the Company not acknowledged as debt 60.67 60.67

In October 2010, search and seizure operations were conducted by the Income Tax authorities under Section 132 of the Income Tax Act, at various locations of the Company. During the course of the search and seizure operations, the income tax authorities have taken custody of certain materials such as documents, records, and recorded statements of certain officials of Company. The Company has not received any communication from the income tax authorities in this regard till the Balance Sheet date. The Company does not expect any liability arising out of the aforesaid search and seizure. The documents and records seized by the authorities did not impair the Company's ability to draw a true and fair financial statement as of and for the year ended March 31, 2011.

2. During the year, the Company has issued 75,40,000 numbers of 6% non cumulative non convertible redeemable preference shares of Rs.10 each with a premium of Rs.90 per share on private placement basis.

3. As per information available with the Company, there are no suppliers covered under Micro, Small & Medium Enterprise Development Act, 2006. As a result, no interest provision/payment has been made by the Company to such creditors, if any, and no disclosure thereof is made in the accounts.

4. Loans are secured as follows:

i) Rupee Term Loans from Banks are secured by way of equitable mortgage of Company's land and immovable properties at Raigarh and a first charge by way of hypothecation of the Company's movable assets (save and except book debts) including movable machinery, machinery spares, tools & accessories, (both present and future), subject to prior charges created in favour of the Company's bankers on the stock of raw materials, finished goods, process stock, consumable stores and book debts for securing working capital facilities.

ii) The above term loans are further secured by the personal guarantees of Mr. Puranmal Agrawal (the chairman), Mr. Suresh Kumar Agrawal, Mr. Saket Agrawal and Mr. Manish Agrawal (directors of the Company).

iii) Cash Credit and other working capital facilities from banks are secured by hypothecation of raw materials, finished goods, goods under process, stores and spares, book debts etc. (both present and future), second charge over the entire fixed assets of the Company and personal guarantees of Mr. Puranmal Agrawal (the chairman), Mr. Suresh Kumar Agrawal, Mr. Saket Agrawal & Mr. Manish Agrawal (directors of the Company).

iv) Hire purchases obligations are secured by hypothecation of vehicles purchased under the respective agreements. All the mortgages and charges created in favour of the banks rank pari-passu inter se, except where specifically stipulated otherwise.

5. Gratuity and other post retirement benefit plans

The Company provides gratuity benefits which are funded with Life Insurance Corporation of India in the form of qualifying insurance policy. Leave encashment benefits is an unfunded plan of the Company.

(g) The estimate of future salary increase, considered in actuarial valuation, takes account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employee market.

(h) The Company expects to contribute Rs. 148.00 lacs to gratuity fund in the year 2011-12.

6. During the current year, the Company has recognized MAT credit entitlement of Rs. 1,055.53 Lacs (Rs.472.84) in terms of Section 115JAA of the Income Tax Act, 1961. Based on future profitability projections, the Company is certain that there would be sufficient taxable income in the future, to claim the above tax credit.

7. In terms of Accounting Standard 22, net deferred tax liability (DTL) of Rs. 1351.54 lacs (Rs. 402.84 lacs) has been recognized during the year and consequently the net DTL stands at Rs. 3,337.34 lacs (Rs. 1985.79 lacs).

8. Interest in joint venture

The Company has a 14.90 % interest in the assets and liabilities of the Madanpur South Coal Company Limited (Joint Venture Company), established in India.

9. Excise duty & cess on stocks represents differential excise duty and cess on opening and closing stock of finished goods.

10. Segment Information:

The Company is engaged in manufacturing of “Iron & Steel”. Consequently it has one reportable business segment e.g. “Iron & Steel”. The analysis of geographical segments is based on the area in which the customers of the Company are located.

The Company has common fixed assets for producing goods for domestic and overseas markets. Hence, separate figures for fixed assets / additions to fixed assets cannot be furnished. Export debtors at the year end amounts to Rs. 306.65 (Rs.Nil).

11. Related Party Disclosures

(a) Names of the related parties :

Subsidiary Company : MSP Group International Singapore (PTE) Limited

Jointly Controlled Entity : Madanpur South Coal Company Limited

Key Management Personnel & their Relatives : Mr. Puranmal Agrawal – Chairman

Mr. Suresh Kumar Agrawal – Managing Director

Mr. Manish Agrawal – Non Executive Director

Mr. Saket Agrawal – Non Executive Director

Mrs. Kiran Agrawal (wife of Chairman)

Mrs. Nisha Agrawal (wife of Managing Director)

Mrs. Kisturi Devi Agrawal (mother of Managing Director)

Enterprises over which Key Management Personnel and/ : Howrah Gases Limited or their Relatives have significant influence MSP Sponge Iron Limited

MSP Metallics Limited

MSP Infotech Private Limited

MSP Properties (India) Private Limited

MSP Cokes Private Limited (Merged with MSP Metallics Limited)

MSP Cement Limited

MSP Power Limited

Chaman Metallics Limited

Shree Khathupati Mercantiles Private Limited

MSP Mines & Minerals Private Limited

High Time Holdings Private Limited

B.S. Confin Private Limited

Prateek Mines & Minerals Private Limited

Adhunik Cement Limited

Danta Vyappar Kendra Limited

Emerald Tradelink Pvt. Ltd.

Ginny Traders Pvt. Ltd.

India Cement And Power Company Limited

Jai K Leasing And Commercial Investment Limited

M.A. Hire Purchase Pvt. Ltd.

Raj Securities Limited

Rajnath Vyapaar Pvt. Ltd.

Shree Saishraddha Cements Pvt. Ltd.

Larigo Investment Pvt. Limited

12. During the year, the Company has hedged its exposure in the iron and steel products by way of entering into certain commodity contracts through the broker dealer. These contracts were settled, otherwise than through actual delivery, whereby the Company has earned an amount of Rs. 3, 025.00 lacs on net settlement basis. Based on a legal opinion obtained, the said income has been treated as income from normal business.

13. The Board of Directors of the Company approved the final audited financial statements for the year 2009-2010 at their meeting dated May 29, 2010. However, dividend for the year 2009-2010 was proposed by the Board of Directors in their meeting dated June 28, 2010 and accordingly paid and accounted for in the financial statements for the year ended March 31, 2011.

14. Previous year's figures indicated in brackets have been regrouped / rearranged where necessary to conform to this year's classification.

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Mar 31, 2010

1. Contingent liabilities not provided for in respect of:

Rs. in lacs

As at As at

Particulars 31st March,2010 31st March, 2009

a) Excise Matters under dispute/ appeal 392.97 81.57

b) Sales Tax Matters under dispute/ appeal 34.20 141.69

c) Un-expired Bank Guarantees and Letters of Credit 603.74 910.05

d) Cess on Power Generation Amount Amount

unascertainable unascertainable

e) Claims against the Company not acknowledged as debt 60.67 -

A search and Seizure was conducted by the Excise Department at the Companys Plant at Raigarh on 17th February, 2009. During the current year, the excise department has returned back the documents relating to consumption of raw materials and production which were seized by the said department. The show cause cum demand notice for Rs. 55.81 lacs received from the department has been considered as contingent liability and included in (a) above.

2. During the year, the Company has decided to issue 1,20,00,000 numbers of 6% non cumulative redeemable preference shares of Rs. 100 each (including premium of Rs. 90 per share) on private placement basis. Against the said issue, a sum of Rs. 2,220 lacs has been received during the year from certain bodies corporate towards application money which is pending allotment as at March 31,2010.

3. As per information available with the Company, there are no suppliers covered under Micro, Small S Medium Enterprise Development Act, 2006. As a result, no interest provision/payment has been made by the Company to such creditors, if any, and no disclosure thereof is made in the accounts.

4. A) Loans are secured as follows:

i) Rupee Term Loans from Banks are secured by way of equitable mortgage by deposit of title deed of Companys land and immovable properties at Raigarh and a first charge by way of hypothecation of the companys movables(save and except book debts)including movable machinery, machinery spares, tools & accessories,(both present and future), subject to prior charges created in favour of the companys bankers on the stock of raw materials, finished goods, process stock, consumable stores and book debts for securing working capital facilities.

ii) All the mortgages and charges created in favour of the banks rank pari-passu inter se, except where specifically stipulated otherwise.

iii) The above term loans are further secured by the personal guarantee of Mr. Puranmal Agrawal (chairman), Mr. Suresh Kumar Agrawal, Mr. Saket Agrawal & Mr. Manish Agrawal (directors of the company).

iv) Cash Credit and other working capital facilities from banks are secured by hypothecation of raw materials, finished goods, process stock, consumable stores, book debts etc.(both present and future), second charge over the entire fixed assets of the company and personal guarantee of Mr. Puranmal AgrawaKchairman), Mr. Suresh Kumar Agrawal, Mr. Saket Agrawal S Mr. Manish Agrawal(directors of the company).

v) Hire purchases obligations are secured by hypothecation of vehicles purchased under the respective agreements.

5. Excise duty & cess on stocks represents differential excise duty and cess on opening and closing stock of finished goods.

6. The Company, at present, is in the process of updating its fixed assets register, pending which, the discrepancies, if any, between the physical and book balance of fixed assets is not presently ascertainable, which, in the view of the management should not be material.

7. Related Party Disclosures

(a) Names of the related parties:

Subsidiary Company : MSP Group International Singapore (PTE) Limited

(w.e.f. 1st April 2009)

Jointly Controlled Entity : Madanpur South Coal Company Limited

Key Management Personnel & their Relatives

: Mr. Puranmal Agrawal - Chairman

Mr. Suresh Kumar Agrawal - Managing Director

Mr. Manish Agrawal - Non Executive Director

Mr. Saket Agrawal - Non Executive Director

Mrs. Kiran Agrawal (wife of Chairman)

Mrs. Nisha Agrawal (wife of Managing Director)

Mrs. Kasturi Devi Agrawal (mother of Managing Director)

Enterprises over which Key Management Personnel and/ or their Relatives have significant influence: Howrah Gases Limited MSP Sponge Iron Limited MSP Metallics Limited MSP Infotech Private Limited MSP Properties (India) Private Limited MSP Cokes Private Limited MSP Group international Singapore (PTE) Limited (Converted into subsidiary with effect from 1st April 2009) MSP Cement Limited MSP Power Limited MSP Energy Limited MSP Rolling Mills Private Limited Chaman Metallics Limited Shree Khathupati Mercantiles Private Limited MSP Mines & Minerals Private Limited High Time Holding Private Limited B.S. Confin Private Limited Rama Alloys Private Limited Pratik Mines & Minerals Private Limited

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Mar 31, 2009

1. Contingent liabilities not provided for in respect of:

(Rs.in lacs)

Particulars As at 31st As at 31st March 2009 March 2008

a) Excise Matters under dispute/ appeal 81.57 68.35

b) Sales Tax Matters under dispute/ appeal 141.69 40.25

c) Un-expired Bank Guarantees and Letters of Credit 910.05 1,037.68

d) Cess on Power Generation (Amount unascertainable) - -

2. The Pellet Plant having achieved the technical parameters of operations and stabilization of production efficiency, has commenced the commercial production as at 29th March, 2009. Accordingly, fixed assets amounting to Rs. 8,677.69 lacs (including allocated pre-operative expenditure and trial run expenditures) have been capitalised during the year.

3. A search and seizure was conducted by Excise department at the Company’s Plant at Raigarh on 17th February, 2009 where in certain supporting documents relating to consumption of raw materials and production have been seized by the said department. Based on the documents and information available with the Company, the figures of raw-materials consumption and production have been arrived at for the period from 1st April’ 08 to 17th February’ 09 which have been relied upon by the auditors.

4. As per information available with the Company, there are no suppliers covered under Micro, Small & Medium Enterprise Development Act, 2006. As a result, no interest provision/payment have been made by the Company to such creditors, if any, and no disclosure thereof is made in this accounts.

5. A) Details of nature of security of Secured Loans

i) Term Loans from banks are secured by way of the following:

a) Equitable mortgage of factory land, buildings and all the immovable fixed assets and hypothecation of all the plant and machinery and other movable assets on pari passu basis with all the term lenders of the Company.

b) Second charge over all the current assets, present and future, on pari passu basis with all the term lenders of the Company.

ii) Working Capital facilities from banks are secured by way of the following:

a) First hypothecation charge on entire current assets i.e. inventories and receivables on pari-passu basis (both present and future).

b) Second charge on factory land and buildings and all the immovable fixed assets and hypothecation of all the plant and machinery and other movable assets on pari passu basis.

iii) The terms loans and working capital facilities are additionally secured by the corporate guarantee of Rama Alloys Private Limited as a collateral security and personnel guarantee of all promoters directors of the Company.

iv) Hire purchases obligations are secured by hypothecation of vehicles purchased under the respective agreements.

B) Secured Loans falling due for repayment within one year Rs. 3,522.30 lacs (Rupees 1,952.70 lacs).

6. Gratuity and other post retirement benefit plans

The Company provides gratuity benefits which is funded with Life Insurance Corporation of India in the form of qualifying insurance policy. Leave encashment benefits is an unfunded plan of the Company.

(g) The estimate of future salary increase, considered in acturial valuation, takes account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employee market.

(h) The Company expects to contribute Rs. 12.00 lacs to gratuity fund in the year 2009-2010.

7. a) Current Tax provision is net of Rs 387.51 lacs (including Rs. 311.28 lacs for earlier years) being the Minimum Alternate Tax (MAT) in terms of section 115JB of the Income Tax Act, 1961. Further, in terms of the provisions of section 115JB of the Income Tax Act, 1961, MAT entitlement of Rs 387.51 lacs is being carried forward for future adjustment. Based on the profitability projections and improved market conditions, the Company is certain that there would be sufficient taxable income in the future, to claim the above tax credit.

8. Interest in joint venture

The Company has a 14.90 % interest in the assets and liabilities of the Madanpur South Coal Company Limited (Joint Venture Company), established in India which is yet to commence the process of commercial extraction of coal and hence no Profit & Loss account have been prepared by the Joint Venture Company.

9. Excise duty & cess on stocks represents differential excise duty and cess on opening and closing stock of finished goods.

10. Segment Information:

The company has only one business segment i.e. iron & steel and thus no further disclosures are required in accordance with Accounting Standard 17 as notified by the Companies (Accounting Standards) Rules, 2006 (as amended).

11. Related Party Disclosures

(a) Names of the related parties : Jointly Controlled Entity : Madanpur South Coal Company Limited

Key Management Personnel & their Relatives

Mr. Puranmal Agrawal – Chairman

Mr. Suresh Kumar Agrawal – Managing Director

Mr. Manish Agrawal – Non Executive Director

Mr. Saket Agrawal – Non Executive Director

Mrs. Kiran Agrawal (wife of Chairman)

Mrs. Nisha Agrawal (wife of Managing Director)

Mrs. Kasturi Devi Agrawal (mother of Managing Director)

Enterprises over which Key Management Personnel and / or their Relatives have significant influence

Howrah Gases Limited

MSP Sponge Iron Limited

MSP Metallics Limited

MSP Infotech Private Limited

MSP Rolling Mills Private Limited

MSP Coke Private Limited

MSP Group International Singapore (PTE) Limited

MSP Cement Limited

MSP Power Limited

Rama Alloys Private Limited

Chaman Metallics Limited

Shree Khathupatti Merchantiles Private Limited

Larigo Investment Private Limited

MSP Mines & Minerals Private Limited

High Time Holding Private Limited

B.S. Confin Private Limited

12. The comparative figures of the previous year appearing in the financial statement have been audited by Companys previous auditor M/S. Dwarka Ashok & Associates, Chartered Accountants, Kolkata.

13. Previous year’s figures including those given in brackets, have been regrouped / rearranged where necessary to conform to this year’s classification.