Notes to Accounts of Nagreeka Exports Ltd.

Mar 31, 2024

K) Provision

Provisions are recognised in the balance sheet when the Company has a present obligation (legal or constructive) as a result of a past event, which is expected to result in an outflow of resources embodying economic benefits which can be reliably estimated. Each provision is based on the best estimate of the expenditure required to settle the present obligation at the balance sheet date. Where the time value of money is significant, provisions are measured on a discounted basis.

Constructive obligation is an obligation that derives from an entity''s actions where:

(i) by an established pattern of past practice, published policies or a sufficiently specific current statement, the entity has indicated to other parties that it will accept certain responsibilities and;

(ii) as a result, the entity has created a valid expectation on the part of those other parties that it will discharge those responsibilities.

L) Onerous contracts

A provision for onerous contracts is recognised when the expected benefits to be derived by the Company from a contract are lower than the unavoidable cost of meeting its obligations under the contract The provision is measured at the present value of the lower of the expected cost of terminating the contract and the expected net cost of continuing with the contract. Before a provision is established, the Company recognises any impairment loss on the assets associated with that contract.

M) Income taxes

Tax expense for the year comprises current and deferred tax. The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the statement of profit and loss because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Company''s liability for current tax is calculated using tax rates and tax laws that have been enacted or substantively enacted by the end of the reporting period.

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying values of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences. In contrast, deferred tax assets are only recognised to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilised.

The carrying value of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised based on the tax rates and tax laws that have been enacted or substantially enacted by the end of the reporting period. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to cover or settle the carrying value of its assets and liabilities.

Deferred tax assets and liabilities are offset to the extent that they relate to taxes levied by the same tax authority and there are legally enforceable rights to set off current tax assets and current tax liabilities within that jurisdiction.

Current and deferred tax are recognised as an expense or income in the statement of profit and loss, except when they relate to items credited or debited either in other comprehensive income or directly in equity, in which case the tax is also recognised in other comprehensive income or directly in equity.

Deferred tax assets include Minimum Alternate Tax (MAT) paid in accordance with the tax laws in India, which is likely to give future economic benefits in the form of availability of set off against future income tax liability. MAT is recognised as deferred tax assets in the Balance Sheet when the asset can be measured reliably and it is probable that the future economic benefit associated with the asset will be realised.

N) Revenue Recognition

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured, regardless of when the payment is being made. Revenue is measured at the fair value of the consideration received or receivable net of discounts, taking into account contractually defined terms and excluding taxes or duties collected on behalf of the government.

Sale of Goods

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have been transferred to the buyer. No revenue is recognised if there are significant uncertainties regarding recovery of the amount due, associated costs or the possible return of goods.

Sale of Services

Revenue is recognised when it is earned and no significant uncertanity exists as to its realisation or collection.

O) Foreign Currency Transactions

The financial statements of the Compny are presented in Indian rupees (''), which is the functional currency of the Company and the presentation currency for the financial statements.

In preparing the financial statements, transactions in currencies other than the Company''s functional currency are recorded at the rates of exchange prevailing on the date of the transaction. At the end of each reporting period, monetary items denominated in foreign currencies are re-translated at the rates prevailing at the end of the reporting period. Nonmonetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not translated.

Exchange differences arising on translation of long term foreign currency monetary items recognised in the financial statements before the beginning of the first Ind AS financial reporting period in respect of which the Company has elected to recognise such exchange differences in equity or as part of cost of assets as allowed under Ind AS 101-"First time adoption of Indian Accounting Standard" are recognised directly in equity or added/deducted to/ from the cost of assets as the case may be. Such exchange differences recognised in equity or as part of cost of assets is recognised in the statement of profit and loss on a systematic basis.

Exchange differences arising on the retranslation or settlement of other monetary items are included in the statement of profit and loss for the period.

Loans in foreign currency for financing the fixed assets are converted at the prevailing exchange rate on the transaction dates. Liabilities payable in foreign currencies on the date of Balance Sheet are restated and all exchange rate differences arising from such restatement are adjusted with the fixed asset.

P) Borrowing Costs

Borrowings costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for the intended use or sale.

Q) Cash and Cash Equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other shortterm highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the balance sheet.

R) Trade Receivables

Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment, if any.

S) Segment Reporting Identification of Segments

The Company has identified manufacturing and export of cotton yarn and other various merchandise as its sole operating segment and the same has been treated as

primary segment. The Company’s secondary geographical segments have been identified based on the location of customers and then demarcated into Indian and overseas revenue earnings.

T) 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 and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

U) Contingent Liabilities & Contingent Assets

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. The company does not recognize a contingent liability but discloses its existence in the financial statements. Contingent assets are neither recognised nor disclosed in the financial statement.

i) Rupee Term loan from Canara Bank - Kolkata is secured by:

(a) an equitable mortgage ranking exclusive charges inter-se by deposit of title deeds of all the immovable properties of the company both present and future, relating to its processing unit at Plot No. T-48 Kagal - Hatkangale Five Star Industrial Area, MIDC, Villange : Talandage, Tal. Hatkanangale, District: Kolhapur, Maharastra -416236

(b) all the existing securities for other regular limits will be available as collateral secutiry as second charge on pari passu basis.

ii) Working Capital Loan from Canara Bank, specialised Mid Corporate Branch, Kolkata , Punjab National Bank, Mid Corporate Branch, Kolkata, Indian Bank, CFB Mission Row Branch, Kolkata, Karnataka Bank Ltd, Overseas Branch, Kolkata and State Bank of India - Overseas Branch, Mumbai are secured byway of :

(a) First charge by way of hypothecation of stock of Raw materials, Work-in-process, finished goods and book debts relating to spinning unit at Village : Yavluj, District : Kolhapur, Maharashtra, and processing unit at Kagal - Hatkanangale Five Star Industrial Area, MIDC, Village : Talandage, Tal. Hatkanangale, District: Kolhapur, Maharashtra and stock-in-trade at trading unit at various ports/warehouses in India, both present and future in a form and manner satisfactory to the bank, ranking pari passu with each other participating working capital banks in consortium.

(b) Second charge on all the fixed assets of the company situated at Village Yavluj & Talandage both at Kolhapur, both present and future ranking pari passu with each other among participating working capital banks in consortium.

(c) Personal guarantee of some of the Directors of the Company.

(iii) Guaranteed Emergency Credit Line (GECL 2.0) Loan from Canara Bank,specialised Mid Corporate Branch, Kolkata, Punjab National Bank, Mid Corporate Branch, Kolkata, Indian Bank, CFB Mission Row Branch, Kolkata, State Bank of India - Overseas Branch, Mumbai and Karnataka Bank Ltd, Overseas Branch, Kolkata are secured by way of :

(a) Primary Security : On the current assets and fixed assets purchased / created out of the credit facilities so extended and Pari Passu charge on the entire current assets of the Company and extension of second pari passu charge on fixed assets of the Company situated at Village Yavluj and talangade both at Kolhapur.

(b) Collateral Security: No fresh collateral security. GECL 2.0 shall rank second charge with the existing credit facility in terms of cash flow and securities.

Guaranteed Emergency Credit Line (GECL 2.0 Extn) Loan from Canara Bank, Mid Corporate Branch, Kolkata, Punjab National Bank,specialised Mid Corporate Branch, Kolkata and Indian Bank, CFB Mission Row Branch, Kolkata are secured by way of :

(a) Primary Security : On the current assets and fixed assets purchased / created out of the credit facilities so extended and Pari Passu charge on the entire current assets of the Company and extension of second pari passu charge on fixed assets of the Company situated at Village Yavluj and talangade both at Kolhapur.

(b) Collateral Security: No fresh collateral security. GECL 2.0 Extn shall rank second charge with the existing credit facility in terms of cash flow and securities.

Facilities are also covered under emergency Credit Line Guarantee Scheme (ECLGS) administered by National Credit Guarantee Trustee Company (NCGTC) Ltd,

37 FINANCIAL RISK MANAGEMENT OBJECTIVE AND POLICIES

The Company has exposure to the following risks from financial instruments.

i) Market Risk

ii) Liquidity Risk

iii) Credit Risk

Market risk:

Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from adverse changes in market rates & prices such as interest rates, foreign currency exchange rates or in the price of market risk-sensitive financial instruments. The Company is exposed to market risk primarily related to foreign exchange rate risk, interest rate risk

and the market value of its investments. Thus the company''s exposure to market risk is a function of investing and borrowing activities and revenue generating and operating activities in foreign currencies.

Interest Rate Risk:

Interest rate risk refers that the fair value of future cash flows of a financial instument will flucuate because of changes in market interest rates. The objective of the Company''s interest rate risk management processes are to lessen the impact of adverse interest rate movement on its earning and cash flows and to minimise counter party risks.

a) Currency Risk:

The company is exposed to currency risk to the extent that there is a mismatch between the currencies in which Export sales, Import purchase, other expenses and borrowings in foreign currency are denominated and the functional currency of the company. The functional currency of the company is Indian Rupees (INR). The currencies in which these transactions are primarily denominated are Euro and USD.

At any point in time, the Company generally hedges its estimated foreign currency exposure in respect of its forecast sales over the following 12 to 18 months. The company uses forward exchange contracts to hedge its currency risk. Such contracts are generally designated as cash flow hedges.

The Company as per its risk management policy uses foreign exchange forward contract and cross currency forward contracts primarily to hedge foreign exchange. The Company does not use derivative financial instruments for trading or speculative purposes.

Loans to Others:

The credit worthiness of the counter party is evaluated by the management on an ongoing basis and is considered to be good.

Investment in mutual funds:

The investment in mutual funds, are entered into with credit worthy fund houses. The credit worthiness of these counter parties are evaluated by the management on an on-going basis and is considered to be good. The Company does not expect any losses from these counter parties.

Cash and Cash equivalents:

Credit risk from balances with banks is managed by the Company in accordance with the company''s policy. Investment of surplus funds are made in mainly in mutual funds with good returns and within approved credit ratings.

Unquoted Investments:

The cost of unquoted investments approximate the fair value because there is a range of possible fair value measurements and the cost represents estimate of fair value within that range.

43 B RIGHT ISSUE AND UTILISATION STATEMENT

The Rights Issue Committee of the Company at their meeting held on 5th March, 2024 have allotted 1,87,49,550 equity shares to the Equity Shareholders of the Company through Rights Issue at issue price of Rs. 20/- per equity Share (including a premium of Rs. 15/- per equity Share and Face Value of Rs.5/- each).

The total Rights Issue proceeds of the Company is Rs. 3,749.91 lakhs .

The funds raised through the aforesaid issue were utilized in accordance with the objectives of the said Right issue stated in the Letter of Offer.

44 DETAILS OF LOANS AND GUARANTEES GIVEN COVERED UNDER SECTION 186(4) OF THE COMPANIES ACT, 2013:

The Company has made investments in the shares of different companies and given loans and advances to different parties which are general in nature. The loans given are interest bearing which are not lower than the prevailing yield of related government security close to the tenure of the respective loans. Further, the company has not given any gurantee or provided any security.

45 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 Transaction Act., 1988 and rules made there under.

46 The Company does not have transactions with any Struck off Company''s during the year.

47 The Company has not traded or invested in Crypto Currency or virtual Currency during the financial year.

⁴⁸ The Company has not advanced or loaned or invested funds to any other person(s) or entity(s) including foreign entities (intermediaries) with the understanding that the

intermediaries shall:

a. Directly or indirectly lend or invest in other persons or entities in any manner what so ever by or on bebalf of the Company (ultimate beneficiaries); or

b. Provide any guarantee,security or the like to or on behalf of the ultimade beneficiaries.

49 The Company has not received any fund from any person(s) or entity(s), including foreign entities ( funding party) with understanding ( whether recorded in writing or otherwise) that the Company will:

a. Directly or indirectly lend or invest in other persons or entities identified in any manner what so ever by or onbehalf of the funding party ( ultimate beneficiaries); or

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

50 The Company has not done 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 assesments under the Income Tax Act.,1961

51 The Company has not been declared as a willful defaulter by any Bank of Financial Institution or Government or any Government Authority.

52 The Company has not filed any scheme of arrangements in terms of Section 230 to 237 of the Company''s Act., 2013 with any competent Authority.

53 Statement of Financial Ratio''s as per Schedule III Requirements has been separately enclosed.

54 The Previous Years Figures has been regrouped /rearranged whenever necessary to confirm to the current year presentation.

55 The financial statements are approved by the audit committee at its meeting held on 30th May, 2024 and by the Board of Directors on 30th May, 2024.

As per our separate report attached of even date For and on Behalf of the Board of Directors

For B Nath & Co. , .

Chartered Accountants bu/^- Su/~

Firm Regn No. 307057E Sushil Patwari Sunil Ishwarlal Patwari

, DIN:00023980 DIN: 00024007

'' Chairman Managing Director

CAGauravMore ^ ,

Partner Sd/- Sd/-

M. No. 306466 Manoj Agarwal Jyoti Sin ha Banerjee

Place : Kolkata Chief Financial Officer Mem No.: A55830

Date: May 30, 2024 Company Secretary

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Mar 31, 2023

2.10) Provision, Contingent Liabilities & Contingent Assets

Provision involving substantial degree of estimation in measurement are recognised when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognised but are disclosed in the notes. Contingent assets are neither recognised nor disclosed in the financial statement.

2.11) Retirement Benefits To Employees

i) Leave Encashment:

Accrued liability for leave encashment has been provided for as per management valuation.

ii) Gratuity:

Accruing liability for gratuity to employees is covered by the Group Gratuity-Cash - Accumulation Scheme of LIC of India and annual contribution due there under are paid /provided in accordance therewith.

2.12) Foreign Currency Transactions

The financial statements of the Company are presented in Indian rupees (''), which is the functional currency of the Company and the presentation currency for the financial statements.

In preparing the financial statements, transactions in currencies other than the Company''s functional currency are recorded at the rates of exchange prevailing on the date of the transaction. At the end of each reporting period, monetary items denominated in foreign currencies are re-translated at the rates prevailing at the end of the reporting period. Nonmonetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not translated.

Exchange differences arising on translation of long term foreign currency monetary items recognised in the financial statements before the beginning of the first Ind AS financial reporting period in respect of which the Company has elected to recognise such exchange differences in equity or as part of cost of assets as allowed under Ind AS 101-"First time adoption of Indian Accounting Standard" are recognised directly in equity or added/deducted to/ from the cost of assets as the case may be. Such exchange differences recognised in equity or as part of cost of assets is recognised in the statement of profit and loss on a systematic basis.

Exchange differences arising on the retranslation or settlement of other monetary items are included in the statement of profit and loss for the period.

Loans in foreign currency for financing the fixed assets are converted at the prevailing exchange rate on the transaction dates. Liabilities payable in foreign currencies on the date of Balance Sheet are restated and all exchange rate differences arising from such restatement are adjusted with the fixed asset.

2.13) Borrowing Costs

Borrowings costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for the intended use or sale.

2.14) Provision For Current And Deferred Tax

Provision for Current Tax is made on the basis of taxable income for the current accounting period and in accordance with the provisions as per Income Tax Act, 1961.

Deferred Tax resulting from "timing difference" between book and taxable profit forthe year is accounted for using the tax rates and laws that have been enacted or substantially enacted as on the balance sheet date. The deferred tax asset is recognised and carried forward only to the extent that there is a reasonable certainty that the assets will be adjusted in future.

2.15) Government Grants / Subsidies / Insurance Claim

Government grants / subsidies / Insurance Claims are recognized when there is reasonable certainty that the same will be received. Revenue grants are recognized in the Profit & Loss Account either as income or deducted from related expenses. Capital grants / subsidies are credited to respective fixed assets where it relates to specific fixed assets. Other grants / subsidies are credited to the Capital Reserve.

2.16) Critical accounting judgment and estimates

The preparation of the financial statements require the use of accounting estimates which, by definition, will seldom equal the actual result. Management also needs to exercise judgment in applying the Company''s accounting policies.

This note provides an overview of the areas that involved a high degree of judgment or complexity, and of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be different than those originally assessed. Detailed information about each of these estimates and judgments is included in relevant notes together with information about the basis of calculation for each affected line item in the financial statements.

Critical estimates and judgments

The areas involving critical estimates and judgments are:

i) Taxation

The Company is engaged in manufacturing & Trading activities and also subject to tax liability under MAT provisions. Significant judgment is involved in determining the tax liability for the Company. Also there are many transactions and calculations during the ordinary course of business for which the ultimate tax determination is uncertain. Further judgment is involved in determining the deferred tax position on the balance sheet date.

ii) Depreciation and amortisation

Depreciation and amortisation is based on management estimates of the future useful lives of the property, plant and equipment and intangible assets. Estimates may change due to technological developments, competition, changes in market conditions and other factors and may result in changes in the estimated useful life and in the depreciation and amortisation charges.

iii) Employee Benefits

The present value of the defined benefit obligations and long term employee benefits depends on a number of factors that are determined on an actuarial basis using a number of assumptions. The assumptions used in determining the net cost (income) include the discount rate. Any changes in these assumptions will impact the carrying amount of defined benefit obligations.

The Company determines the appropriate discount rate at the end of each year. This is the interest rate that should be used to determine the present value of estimated future cash outflows expected to be required to settle the obligations. In determining the appropriate discount rate, the Company considers the interest rates of Government securities that have terms to maturity approximating the terms of the related defined benefit obligation. Other key assumptions for obligations are based in part on current market conditions.

iv) Provisions and Contingencies

Provisions and contingencies are based on Management''s best estimate of the liabilities based on the facts known at the balance sheet date.

2.17) Onerous contracts

A provision for onerous contracts is recognised when the expected benefits to be derived by the Company from a contract are lower than the unavoidable cost of meeting its obligations under the contract. The provision is measured at the present value of the lower of the expected cost of terminating the contract and the expected net cost of continuing with the contract. Before a provision is established, the Company recognises any impairment loss on the assets associated with that contract.

2.18) Cash and Cash Equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the balance sheet.

2.19) 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 and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

46 The Company does not have transactions with any Struck off Company''s during the year.

47 The Company has not traded or invested in Crypto Currency or virtual Currency during the financial year.

⁴⁸ The Company has not advanced or loaned or invested funds to any other person(s) or entity(s) including foreing entities (intermediaries) with the understanding that the intermediaries shall:

a. Directly or indirectly lend or invest in other persons or entities in any manner whatsoever by or on bebalf of the Company (ultimate beneficiaries); or

b. Provide any guarantee,security or the like to or on behalf of the ultimate beneficiaries.

49 The Company has not received any fund from any person(s) or entity(s), including foreign entities ( funding party) with understanding ( whether recorded in writing or otherwise) that the Company will:

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

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

50 The Company has not done 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 assesments under the Income Tax Act.,1961

51 The Company has not been declared as a willful defaulter by any Bank of Financial Institution or Government or any Government Authority.

52 The Company has not filed any scheme of arrangements in terms of Section 230 to 237 of the Companies Act, 2013 with any competent Authority.

53 Statement of Financial Ratio''s as per Schedule III Requirements has been separately enclosed.

54 The Previous Years Figures has been regrouped /rearranged whenever necessary to confirm to the current year presentation.

55 The financial statements are approved by the audit committee at its meeting held on 30th May, 2023 and by the Board of Directors on 30th May, 2023.

As per our separate report attached of even date For and on Behalf of the Board of Directors

For B Nath & Co. Sushil Patwari Sunil Ishwarlal Patwari

Chartered Accountants DIN:00023980 DIN:00024007

Firm Regn No.:307057E Chairman Managing Director

CA Gaurav More Manoj Agarwal Akansha Agarwal

Partner Chief Financial Officer Mem No.: A61906

M.No:306466 Company Secretary

Place:Kolkata

Date:May 30,2023

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Mar 31, 2018

1. CAPITAL COMMITMENTS:

Estimated amount of contracts remaining to be executed on Capital Account and not provided for Rs. NIL (Net of advances) (Previous Year Rs. NIL Lacs ).

2. CORPORATE SOCIAL RESPONSIBILITY :

As per Section 135 of the Companies Act 2013, a corporate social responsibility (CSR) committee has been formed by the Company. The Company is working primarily in the field of woman empowerment and promoting women education and tribal education. The funds were primarily transferred to the trust for the said purpose. “Amount to be spent on CSR : Rs. NIL “Amount actually spent on CSR : Rs.1,55,700/-.

3. CONTINGENT LIABILITIES NOT PROVIDED FOR

i. Bills discounted with Banks Rs. 2911.85 Lacs (Previous Year Rs. 3426.52 lacs).

ii. Bank Guarantees of Rs. 206.38 Lacs (Previous Year Rs. 158.11 lacs) issued in favour of Custom, Central Excise & Other Government Authorities.

iii. Disputed Statutory Dues :-

a) The Income Tax Assessment of the Company have been completed up to Assessment Year 2015-2016. Disputed Income Tax Liabilities for which appeal is pending before different appellate authorities for Assessment Year 20052006, 2006-2007, 2012-2013, 2013-2014 & 2014-2015 are Rs. 24.23 Lacs. (Previous Year Rs. 24.23 Lacs)

b) Disputed Sales Tax liability for which appeal is pending before Sales Tax authorities relating to financial year from 2009-2010 & 2011-2012 Rs. 80.13 Lacs. (Previous Year Rs. 93.17 Lacs)

c) Disputed Central Service Tax liability for which appeal is pending before different Service Tax authorities relating to financial year 2010-2011 is Rs. 3.71 Lacs (Previous Year Rs. 3.71 Lacs)

d) Disputed Custom Duty Liabilities for which appeal is pending before CESTAT, Kolkata relating to financial year 2013 2014 is Rs. 389.32 Lacs (Previous Year Nil)

NOTE : Based on the decision of the Appellate authorities and the interpretations of the other relevant provisions, the Company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision has been made.

4. SEGMENT INFORMATION

(i) Business Segment: The Company''s business activity primarily falls within a single business segment i.e. textiles business and hence there are no disclosures to be made under Ind AS -108, other than those already provided in the financial statements.

(ii) Geographical Segment: The Company operates in multiple geographical area and therefore the analysis of geographical segment is based on the areas in which customers of the Company are located.

5. RELATED PARTIES WITH WHOM TRANSACTION HAVE TAKEN PLACE DURING THE YEAR

a) Key Management personnel''s

Shri Sushil Patwari: Chairman Shri Sunil Patwari: Managing Director Shri Mahendra Patwari: Whole Time Director Shri Debrata Das Choudhary : Whole Time Director

Shri Kedar Nath Bansal : Chief Financial Officer

Shri J. Tiwari: Company Secretary

Relatives of Key Management Personnel''s & Others :

Patwari Properties Smt. Minakshi Patwari Smt. Anita Patwari Shri Pratyush Patwari

Enterprises Owned/Influenced by Key Management Personnel or theit relative :

Nagreeka Capital & Infrastructure Ltd.

6. In previous year there was a fire at Bleaching & dyeing unit situated at Kagal (Maharastra) during March, 2017. The surveyor has submitted interim survey report and assessed the final loss of stock. In regards to loss of Plant & Machinery and other assets, the same is under process.

7. FINANCIAL INSTRUMENTS

The significant accounting policies, including the criteria for recognition, the basis of measurement and the basis on which income and expenses are recognized, in respect of each class of financial asset, financial liability and equity instrument are disclosed in note 2.6 to the financial statements.

Fair value hierarchy:

The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either observable or unobservable and consists of the following three levels:

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company can access at the measurement date;

Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly; and

Level 3 inputs are unobservable inputs for the asset or liability.

The investments included in Level 2 of fair value hierarchy have been valued using quotes available for similar assets and liabilities in the active market. The investments included in Level 3 of fair value hierarchy have been valued using the cost approach to arrive at their fair value. The cost of unquoted investments approximate the fair value because there is a range of possible fair value measurements and the cost represents estimate of fair value within that range

The following table summarizes financial assets and liabilities measured at fair value on a recurring basis and financial assets that are not measured at fair value on a recurring basis (but fair value disclosure are required):

Notes:

i) The short-term financial assets and liabilities are stated at amortized cost which is approximately equal to their fair value.

ii) Unquoted Investments are stated at amortized cost which is approximately equal to their fair value.

iii) There have been no transfers between level 1 and level 2 for the years ended March 31, 2018 and 2017.

8. CAPITAL MANAGEMENT

For the purpose of the Company''s capital management, capital includes issued capital and all other equity reserves. The primary objective of the Company''s Capital Management is to maximize shareholder value. The company manages its capital structure and makes adjustments in the light of changes in economic environment and the requirements of the financial covenants.

The Company monitors capital using gearing ratio, which is total debt divided by total capital plus debt.

9.FINANCIAL RISK MANAGEMENT OBJECTIVE AND POLICIES

The Company has exposure to the following risks from financial instruments.

i) Market Risk

ii) Liquidity Risk

iii) Credit Risk

Market risk:

Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from adverse changes in market rates & prices such as interest rates, foreign currency exchange rates or in the price of market risk-sensitive financial instruments. The Company is exposed to market risk primarily related to foreign exchange rate risk, interest rate risk and the market value of its investments. Thus the company’s exposure to market risk is a function of investing and borrowing activities and revenue generating and operating activities in foreign currencies.

a) Currency Risk:

The company is exposed to currency risk to the extent that there is a mismatch between the currencies in which Export sales, Import purchase, other expenses and borrowings in foreign currency are denominated and the functional currency of the company. The functional currency of the company is Indian Rupees (INR). The currencies in which these transactions are primarily denominated are Euro and USD.

At any point in time, the Company generally hedges its estimated foreign currency exposure in respect of its forecast sales over the following 12 to 18 months. The company uses forward exchange contracts to hedge its currency risk. Such contracts are generally designated as cash flow hedges.

The Company as per its risk management policy uses foreign exchange forward contract and cross currency forward contracts primarily to hedge foreign exchange. The Company does not use derivative financial instruments for trading or speculative purposes.

Liquidity risk:

Liquidity risk is the riks that Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk by ensuring as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risk to the Company’s reputation.

The company has obtained fund and non-fund based working capital loans from various banks. The Company also constantly monitors funding options available in the debt and capital markets with a view to maintaining financial flexibility.

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

CREDIT RISK:

Credit risk is the of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company receivables from customers and investments in debt securities, cash and cash equivalents, mutual funds, bonds etc.

The carrying amount of financial assets represents the maximum credit exposure.

Trade & Other receivables:

In case of sales, for major part of the sales, customer credit risk is managed by requiring domestic and export customers to open Letters of Credit before transfer of ownership, therefore substantially eliminating the Company’s credit risk in this respect.

Based on prior experience and an assessment of the current economic environment, management believes that no provision is required for credit risk where credit is extended to customers.

Management believes that the unimpaired amounts that are past due by more than 6 months are still collectible in full based on historical payment behavior.

Loans to Others:

The credit worthiness of the counter party is evaluated by the management on an ongoing basis and is considered to be good.

Investment in mutual funds:

The investment in mutual funds, are entered into with credit worthy fund houses. The credit worthiness of these counter parties are evaluated by the management on an on-going basis and is considered to be good. The Company does not expect any losses from these counter parties.

Cash and Cash equivalents:

Credit risk from balances with banks is managed by the Company in accordance with the company’s policy. Investment of surplus funds are made in mainly in mutual funds with good returns and within approved credit ratings.

Unquoted Investments:

"The cost of unquoted investments approximate the fair value because there is a range of possible fair value measurements and the cost represents estimate of fair value within that range.

NOTES:

1 To comply with the Companies (Accounting Standard) Rules, 2006, certain account balances have been regrouped as per the format prescribed under Division II of Schedule III to the Companies Act, 2013.

2 Financial liabilities and related transaction costs:

Borrowings and other financial liabilities which were recognized at historical cost under previous GAAP have been recognized at amortized cost under IND AS with the difference been adjusted to opening retained earnings. Under previous GAAP, transaction costs incurred in connection with borrowings were amortized equally over the tenure of the borrowings. Under IND AS, transaction costs are deducted from the initial recognition amount of the financial liability and charged over the tenure of borrowing using the effective interest method.

3 Financial assets at amortized cost:

Certain financial assets held on with an objective to collect contractual cash flows in the nature of principal and interest have been recognized at amortized cost on transition date as against historical cost under the previous GAAP with the difference been adjusted to the opening retained earnings.

4 Other comprehensive income:

Under IND AS, all items of income and expense recognized in the period should be included in profit or loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognized in profit or loss but are shown in the statement of profit and loss and “other comprehensive income” includes measurements of defined benefit plans, foreign currency monetary item translation difference account, effective portion of gains and losses on cash flow hedging instruments and fair value gain or losses on FVTOCI equity instruments. The concept of other comprehensive income did not exist under previous GAAP.

10 Advances, Trade Payable and Trade Receivables are subject to confirmation from respective parties and consequential reconciliation / adjustment arising there from, if any. The management, however, does not expect any material variation. Provisions, wherever considered necessary, have been made.

11. FAIR VALUE OF FINANCIAL ASSETS AND FINANCIAL LIABILITIES THAT ARE NOT MEASURED AT FAIR VALUE:

The management consider that the carrying amounts of financial assets and liabilities recognized in the financial statements approximate their fair value as on 31st March 2017 and 1st April 2016

12. DETAILS OF LOANS AND GUARANTEES GIVEN COVERED UNDER SECTION 186(4) OF THE COMPANIES ACT, 2013:

The Company has made investments in the shares of different companies and given loans and advances to different parties which are general in nature. The loans given are interest bearing which are not lower than the prevailing yield of related government security close to the tenure of the respective loans. Further, the company has not given any guarantee or provided any security.

The Previous Year’s Figures has been regrouped /rearranged whenever necessary to confirm to the current year presentation.

The financial statements are approved by the audit committee at its meeting held on 25th May,2018 and by the Board of Directors on 26th May, 2018.

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Mar 31, 2016

1. COMPANY OVERVIEW:

The Company was incorporated on 6th March, 1989 under the laws of republic of India and has its registered office at Kolkata, West Bengal. The company is engaged in manufacturing and export of cotton yarn and other various merchandise. The shares of the company are listed in National Stock Exchange. Company has set up 100% export oriented unit with the state of art, Plant with manufacturing capacity of 55440 spindles at Kolhapur in Maharashtra. The company has also set up yarn dying and cotton bleaching plant at Kagal Kolhapur. The Company was also awarded International standard Organization certificate for export performance. The company’s marketing network is spread over in various countries. The Company is also doing trading of cotton yarn and various commodities. The company is Merchant exporter also.

i) Rupee Term loan from Canara Bank - Kolkata, Oriental Bank of Commerce - Kolkata and State Bank of Patiala - Mumbai is secured by

(a) an equitable mortgage ranking pari-passu inter-se by deposit of title deeds of all the immovable properties of the company both present and future, relating to its spinning unit premises at Village : Yavluj, District : Kolhapur, Maharastra and

(b) by way of hypothecation ranking pari-passu inter-se of all movable properties of the company both present and future including movable machineries, spares, tools & accessories (save & except book debts) subject to prior charges created or to be created in favour of the Company’s Bankers, on its stock of Raw Materials, finished goods, consumable stores, book debts & such other movables as may be specifically permitted by the institutions in writing, to secure borrowings for working capital requirements and

(c) Personal guarantee of some of the Directors of the Company.

ii) Rupee Term loan from Canara Bank - Kolkata is secured by

(a) an equitable mortgage ranking exclusive charges inter-se by deposit of title deeds of all the immovable properties of the company both present and future, relating to its Dying & Bleaching unit premises at Village : Kagal, District : Kolhapur, Maharastra

(b) all the existing securities for other regular limits will be available as co-lateral security on pari-passu basis

iii) Working Capital Term Loan from Canara Bank, Overseas Branch, Kolkata is secured by way of :

(a) hypothecation of stock of Raw materials, Work-in-process, finished goods and book debts relating to spinning unit at Village : Yavluj, District : Kolhapur, Maharastra and stock-in-trade at trading unit Kolkata,

(b) Second charge on immovable properties of the company relating to above mentioned spinning unit, and

(c) Personal guarantee of some of the Directors of the Company.

i) Working Capital Loan from Canara Bank, Overseas Branch, Kolkata & Mumbai , Oriental Bank of Commerce, Overseas Branch, Kolkata, Allahabad Bank, Industrial Finance Branch, Kolkata and State Bank of Patiala - Commercial Branch,Mumbai are secured by way of :

(a) First charge by way of hypothecation of stock of Raw materials, Work-in-process, finished goods and book debts relating to spinning unit at Village : Yavluj, District : Kolhapur, Maharastra, Dying & Bleaching unit premises at Village : Kagal, District : Kolhapur, Maharastra and stock-in-trade at trading unit Kolkata & Mumbai, both present and future in a form and manner satisfactory to the bank, ranking paripasu with each other participating working capital banks.

(b) Second charge on all the fixed assets of the company, both present and future ranking paripassu with each other participating working capital banks.

(c) Personal guarantee of some of the Directors of the Company.

i) The Company has not received any information from its suppliers regarding registration under “The Micro, Small and Medium Enterprises Developement Act, 2006.” Hence, the information required to be given in accordance with Section 22 of the said Act, is not ascertainable. Hence, not disclosed.

i) Based on the information/documents available with the Company, there was an unpaid dividend amounting to Rs. 2,80,529/ - due relating to (2007-2008) and outstanding as on 31st March, 2015 which has been transferred to Investors Education and Protection Fund under Section 125 of the Companies Act, 2013.

2. CAPITAL COMMITMENTS: Estimated amount of contracts remaining to be executed on Capital Account and not provided for Rs. 289.79 Lacs (Net of advances) (Previous Year Rs. NIL ).

3. CORPORATE SOCIAL RESPONSIBILITY : As per Section 135 of the Companies Act 2013, a corporate social responsibility (CSR) committee has been formed by the Company. The Company is working primarily in the field of woman empowerment and promoting women education and tribal education. The funds were primarily transferred to the trust for the said purpose. Amount to be spent on CSR : Rs. 14,02,650/Amount actually spent on CSR : Rs. 15,03,000/-.

4. CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF :

i. Bills discounted with Banks Rs. 2411.07 Lacs (Previous Year Rs. 2669.52 lacs).

ii. Bank Guarantees of Rs. 325.15 Lacs (Previous Year Rs. 325.15 lacs) issued in favour of Custom, Central Excise & Other Government Authorities.

iii. Disputed Statutory Dues :-

a) a) The Income Tax Assessment of the Company have been completed up to Assessment Year 2013-2014. Disputed Income Tax Liabilities for which appeal is pending before different appellate authorities for Assessment Year 2005-2006, 2006-2007, 2010-2011 & 2011-2012 are Rs. 332.85 Lacs

b) Disputed Sales Tax liability for which appeal is pending before Sales Tax authorities relating to financial year from 2009-2010 is Rs. 40.29 Lacs

c) Disputed Central Service Tax liability for which appeal is pending before different Service Tax authorities relating to financial year 2010-2011 is Rs. 3.71 Lacs

Based on the decision of the Appellate authorities and the interpretations of the other relevant provisions, the Company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision has been made.

5. As per Accounting Standard 28 issued by the Institute of Chartered Accountants of India, the Company has assessed recoverable value of generating unit based on value in used method which has worked out to be much higher than corresponding book value of net assets thereby not warranting further exercise of arriving at their net selling price. This further confirms absence of exigency of making any provision for impairment of asset(s)

6 The Company has only one business segment i.e. Textiles and thus no further disclosure are required in accordance with Accounting Standard 17 notified by Companies (Accounting Standards) Rules, 2006 (As amended) of Companies Act, 2013.

7. The Previous Year figures has been re-grouped / re-arranged wherever necessary to conform to the current year presentation

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Mar 31, 2015

1. CAPITAL COMMITMENTS: Estimated amount of contracts remaining to be executed on Capital Account and not provided for Rs. NIL (Net of advances) (Previous Year Rs. 160.19 Lacs ).

2. CORPORATE SOCIAL RESPONSIBILITY : As per Section 135 of the Companies Act 2013, a corporate social responsibility (CSR) committee has been formed by the Company. The Company is working primarily in the field of woman empowerment and promoting women education and tribal education. The funds were primarily transferred to the trust for the said purpose. Amount to be spent on CSR : Rs. 11,81,481/-, Amount actually spent on CSR : Rs. 15,03,000/-.

3. CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF :

i. Bills discounted with Banks Rs. 2669.52 Lacs (Previous Year Rs. 7197.21 lacs).

ii. Bank Guarantees of Rs. 325.15 Lacs (Previous Year Rs. 305.55 lacs) issued in favour of Custom, Central Excise & Other Government Authorities.

iii. Disputed Statutory Dues :

a) The Income Tax Assessment of the Company have been completed up to Assessment Year 2013-2014. Disputed Income Tax Liabilities for which appeal is pending before different appellate authorities for Assessment Year 2000-2001, 2005-2006, 2006-2007, 2010-2011 & 2011-2012 are Rs. 344.84 Lacs.

b) Disputed Central Excise liability for which appeal is pending before different excise authorities relating to financial year from 2005-2006 is Rs. 27.13 Lacs.

c) Disputed Central Service Tax liability for which appeal is pending before different Service Tax authorities relating to financial year from 2004-2005, 2005-2006 & 2009-2010 is Rs. 15.15 Lacs.

Based on the decision of the Appellate authorities and the interpretations of the other relevant provisions, the Company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision has been made.

4. As per Accounting Standard 28 issued by the institute of Chartered Accountants of India, the company has assessed recoverable value of generating unit based on value in used method which has worked out to be much higher than corresponding book value of net assets thereby not warranting further exercise of arriving at their net selling price. This further confirms absence of exigency of making any provision for impairment of asset(s)

5. The Company has only one business segment i.e. Textiles and thus no further disclosure are required in accordance with Accounting Standard 17 notified by Companies (Accounting Standards) Rules, 2006 (As amended) of the Companies Act, 1956.

6. The Previous Year figures has been re-grouped / re-arranged wherever necessary to conform to the current year presentation.

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Mar 31, 2014

1. COMPANY OVERVIEW:

The Company was incorporated on 6th March, 1989 under the laws of republic of India and has its registered office at Kolkata, West Bengal. The company is engaged in manufacturing and export of cotton yarn and other various merchandise. The shares of the company are listed in National Stock Exchange. Company has set up 100% export oriented unit with the state of art, Plant with manufacturing capacity of 55440 spindles at Kolhapur in Maharashtra. The company has also set up yarn dying and cotton bleaching plant at Kagal Kolhapur. The Company was also awarded International standard Organization certificate for export performance. The company''s marketing network is spread over in various countries. The Company is also doing trading of cotton yarn and various commodities. The company is Merchant exporter also.

2. i) Rupee Term loan from Canara Bank - Kolkata, Oriental Bank of Commerce - Kolkata and State Bank of Patiala - Mumbai is secured by

(a) an equitable mortgage ranking pari passu inter-se by deposit of title deeds of all the immovable properties of the company both present and future, relating to its spinning unit premises at Village : Yavluj, District : Kolhapur, Maharastra and

(b) by way of hypothecation ranking pari passu inter-se of all movable properties of the company both present and future including movable machineries, spares, tools & accessories (save & except book debts) subject to prior charges created or to be created in favour of the Company''s Bankers, on its stock of Raw Materials, finished goods, consumable stores, book debts & such other movables as may be specifically permitted by the institutions in writing, to secure borrowings for working capital requirements and

(c) Personal guarantee of some of the Directors of the Company.

ii) Working Capital Term Loan from Canara Bank, Overseas Branch, Kolkata is secured by way of :

(a) hypothecation of stock of Raw materials, Work-in-process, finished goods and book debts relating to spinning unit at Village : Yavluj, District : Kolhapur, Maharastra and stock-in-trade at trading unit Kolkata,

(b) Second charge on immovable properties of the company relating to above mentioned spinning unit, and

(c) Personal guarantee of some of the Directors of the Company.

iii) For the above loan a securitisation agreement entered in between the Company, AXIS Bank Limited and the above lenders.

iV) Rupee Term loan from Canara Bank - Kolkata is secured by

(a) an equitable mortgage ranking exclusive charges inter-se by deposit of title deeds of all the immovable properties of the company both present and future, relating to its Dying & Bleaching unit premises at Village : Kagla, District : Kolhapur, Maharastra

(b) all the excisting securities for other regular limits will be available as co-lateral secutiry on pari pasu basis

3. i) Working Capital Loan from Canara Bank, Overseas Branch, Kolkata & Mumbai , Oriental Bank of Commerce, Overseas Branch, Kolkata, Allahabad Bank, Industrial Finance Branch, Kolkata, State Bank of Patiala - Commercial Branch,Mumbai and ICICI Bank Limited, Kolkata are secured by way of :

(a) First charge by way of hypothecation of stock of Raw materials, Work-in-process, finished goods and book debts relating to spinning unit at Village : Yavluj, District : Kolhapur, Maharastra and stock-in-trade at trading unit Kolkata, both present and future in a form and manner satisfactory to the bank, ranking pari pasu with each other participating working capital banks.

(b) Second charge on all the fixed assets of the company, both present and future ranking pari pasu with each other participating working capital banks.

(c) Personal guarantee of some of the Directors of the Company.

4. CAPITAL COMMITMENTS:

Estimated amount of contracts remaining to be executed on Capital Account and not provided for Rs. 160.19 Lacs (Net of advances) (Previous Year Rs. 6.09 Lacs ).

5. CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF :

i. Bills discounted with Banks Rs. 7197.21 Lacs (Previous Year Rs. 5403.55 lacs).

ii. Bank Guarantees of Rs. 305.55 Lacs (Previous Year Rs. 426.47 lacs) issued in favour of Custom, Central Excise & Other Government Authorities.

iii. Disputed Statutory Dues :-

a) The Income Tax Assessment of the Company have been completed up to Assessment Year 2011-2012. Disputed Income Tax Liabilities for which appeal is pending before different appellate authorities for Assessment Year 2000-2001, 2005-2006, 2006-2007 ,2008-2009, 2010-2011 & 2011-2012 are Rs. 445.99.

b) Disputed Central Excise liability for which appeal is pending before different excise authorities relating to financial year from 2005-2006 is Rs. 27.13 Lacs.

c) Disputed Central Service Tax liability for which appeal is pending before different Service Tax authorities relating to financial year from 2004-2005, 2005-2006 & 2009-2010 is Rs. 25.15 Lacs.

Based on the decision of the Appellate authorities and the interpretations of the other relevant provisions, the Company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision has been made.

6. As per Accounting Standard 28 issued by the institute of Chartered Accountants of India, the company has assessed recoverable value of generating unit based on value in used method which has worked out to be much higher than corresponding book value of net assets thereby not warranting further exercise of arriving at their net selling price. This further confirms absence of exigency of making any provision for impairment of asset(s)

7. The Previous Year figures has been re-grouped / re-arranged wherever necessary to conform to the current year presentation

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Mar 31, 2013

1. COMPANY OVERVIEW :

The company was incorporated on 6th March, 1989 under the laws of republic of india and has its registered office at kolkata,West bengal. The company is engaged in manufacturing and export of cotton yarn and other various merchandise. The shares of the company are listed in National stock exchange and Bombay stock exchange. Company has set up 100% export oriented unit with the state of art, Plant with export capacity of 55440 spindles at Kolhapur in Maharashtra. The Company was also awarded International standard organization certificate for export performance. The Company''s marketing network is spread over in various countries. The Company also doing trading of cotton yarn and various commodities. The Company is merchant exporter also. The Company has taken up for setting of yarn deying and cotton bleaching plant at Kolhapur.

2. CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF :

i. Bills discounted with Banks Rs. 5403.55 Lacs (Previous Year Rs. 4199.76 lacs).

ii. Bank Guarantees of Rs. 426.47 Lacs (Previous Year Rs. 371.37 lacs) issued in favour of Custom, Central Excise & Other Government Authorities. in Disputed Statutory Dues :-

a) The Income Tax Assessment of the Company have been completed up to Assessment Year 2010-2011. Disputed ''Income Tax Liabilities for which appeal is pending before different appellate authorities for Assessment Year 2000- 2001, 2005-2006, 2006-2007, 2008-2009 & 2010-2011 are Rs. 269.61.

b) Disputed Central Excise liability for which appeal is pending before different excise authorities relating to financial year from 2005-2006 is Rs. 27.13 Lacs.

c) Disputed Central Service Tax liability for which appeal is pending before different Service Tax authorities relating to financial year from 2004-2005, 2005-2006 & 2009-2010 is Rs. 25.15 Lacs.

Based on the decision of the Appellate authorities and the interpretations of the other relevant provisions, the Company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision has been made,

3. As per Accounting Standard 28 issued by the institute of Chartered Accountants of India, the company has assessed recoverable value of generating unit based on value in used method which has worked out to be much higher than corresponding book value of net assets thereby not warranting further exercise of arriving at their net selling price. This further confirms absence of exigency of making any provision for impairment of asset(s).

4. The Company has only one business segment i.e. Textiles and thus no further disclosure are required in accordance with Accounting Standard 17 notified by companies ( Accounting Standards) Rules, 2006 ( As amended) of the Companies Act, 1956.

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Mar 31, 2012

1. COMPANY OVERVIEW :

The company was incorporated on 6th March, 1989 under the laws of republic of india and has its registered office at kolkata,West bengal. The company is engaged in manufacturing and export of cotton yarn and other various merchandise. The shares of the company are listed in National stock exchange and Bombay stock exchange. Company has set up 100% export oriented unit with the state of art, Plant with export capacity of 55440 spindles at Kolhapur in Maharashtra. The Company was also awarded International standard organization certificate for export performance. The Company's marketing network is spread over in various countries. The Company also doing trading in export of cotton yarn arid various commodities. The Company is merchant exporter also. The Company has taken up for setting of yarn deying and cotton bleaching plant at Kolhapur.

i) Rupee Term loan from Canara Bank - Kolkata, Oriental Bank of Commerce - Kolkata and State Bank of Patiala - Mumbai is secured by

(a) an equitable mortgage ranking pari passu inter-se by deposit of title deeds of all the immovable properties of the company both present and future, relating to its spinning unit premises at Village : Yavluj, District : Kolhapur, Maharastra and

(b) by way of hypothecation ranking pari passu inter-se of all movable properties of the company both present and future including movable machineries, spares, tools & accessories (save & except book debts) subject to prior charges created or to be created in favour of the Company's Bankers, on its stock of Raw Materials, finished goods, consumable stores, book debts & such other movables as may be specifically permitted by the institutions in writing, to secure borrowings for working capital requirements and

(c) Personal guarantee of some of the Directors of the Company.

iii) Working Capital Term Loan from Canara Bank, Overseas Branch, Kolkata is secured by way of :

(a) hypothecation of stock of Raw materials, Work-in-process, finished goods and book debts relating to spinning unit at Village : Yavluj, District : Kolhapur, Maharastra and stock-in-trade at trading unit Kolkata,

(b) Second charge on immovable properties of the company relating to above mentioned spinning unit, and

(c) Personal guarantee of some of the Directors of the Company.

i) Working Capital Loan from Canara Bank, Overseas Branch, Kolkata & Mumbai , Oriental Bank of Commerce, Overseas Branch, Kolkata, Allahabad Bank, Industrial Finance Branch, Kolkata, State Bank of Patiala - Commercial Branch,Mumbai and ICICI Bank Limited, Kolkata are secured by way of :

(a) First charge by way of hypothecation of stock of Raw materials, Work-in-process, finished goods and book debts relating to spinning unit at Village : Yavluj, District: Kolhapur, Maharastra and stock-in-trade at trading unit Kolkata, both present and future in a form and manner satisfactory to the bank, ranking pari pasu with each other participating working capital banks.

(b) Second charge on all the fixed assets of the company, both present and future ranking pari pasu with each other participating working capital banks.

(c) Personal guarantee of some of the Directors of the Company.

ii) Previous Year working Capital Loan includes working capital loan from ING Vysya Bank Limited, Overseas Branch, Mumbai was secured by way of:

(a) hypothecation of stock of raw materials, work in process, Finished goods, book debts relating to spinning unit at Village : Yavluj, District : Kolhapur, Maharastra and

(b) second charge on immovable Properties of the Company relating to above mentioned spinning unit and

(c) Personal guarantee of some of the Directors of the Company.

i) The Company Has not received any information its suppliers regarding registration under "The Micro, Small and Medium Enterprises Development Act, 2006 " Hence, the information required to be given in accordance section 12 of the said Act, is not ascertainable. Hence, not disclosed.

ii) The Company has also computed and made necessary provisions on account of leave encashment benefits based on acturial valuation as per accounting standard - 15 (Revised) "Employee Benefits" The total service eligibility as per the company's leave rules are estimated and provided in Ihe books as a revenue expenditure after making adjustment towards the benefit paid on this benefit obligation were carried out at 31st March 2012

2 CAPITAL COMMITMENTS :

Estimated amount of contracts remaining to be executed on Capital Account and not provided for Rs. 2948.91 Lacs (Net of advances) (Previous Year Rs. Nil Lacs).

3CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF :

i. Bills discounted with Banks Rs. 4199.76 Lacs (Previous Year Rs. 5918.49 lacs).

ii. Bank Guarantees of Rs. 371.37 Lacs (Previous Year Rs. 341.70 lacs) issued in favour of Custom, Central Excise & Other Government Authorities.

iii. Disputed Statutory Dues

a) The Income Tax Assessment of the Company have been completed up to Assessment Year 2009-2010. Disputed Income Tax Liabilities for which appeal is pending before different appellate authorities for Assessment Year 2000- 2001, 2005-2006, 2006-2007 & 2008-2009 are Rs. 328.78.

b) Disputed Central Excise liability for which appeal is pending before different excise authorities relating to financial year from 2005-2006 is Rs. 27.13 Lacs.

c) Disputed Central Service Tax liability for which appeal is pending before different Service Tax authorities relating to financial year from 2004-2005, 2005-2006 & 2009-2010 is Rs. 25.15 Lacs.

Based on the decision of the Appellate authorities and the interpretations of the other relevant provisions, the Company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision has been made.

4. As per Accounting Standard 28 issued by the institute of Chartered Accountants of India, the company has assessed recoverable value of generating unit based on value in used method which has worked out to be much higher than corresponding book value of net assets thereby not warranting further exercise of arriving at their net selling price. This further confirms absence of exigency of making any provision for impairment of asset(s).

5. The financial statements for the year ended March 31,2011 had been prepared as per applicable, pre-revised schedule VI to the companies Act, 1956. Consequent to the notification of Revised schedule VI under the Companies Act. 1956, the financial statements for the year ended March 31,2012 are prepared as per revised Schedule VI. Accordingly the previous year figures have also been classified to confirm to this year classification. The adoption of revised Schedule VI for previous year figures does not impact recognition and measurement principle followed for preparation of financial statements.

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Mar 31, 2010

1. CAPITAL COMMITMENTS : Estimated amount of contracts remaining to be executed on Capital Account and not provided for Rs. Nil (Net of advances) (Previous Year Rs. 185.00 Lacs).

2. CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF :

i. Bills discounted with Banks Rs. 5484.31 Lacs (Previous Year Rs. 2060.47 lacs).

ii. Bank Guarantees of Rs. 144.70 lacs (Previous year Rs. 138.50 lacs) issued in favour of Custom, Central Excise &

Other Government Authorities. iii. Disputed Statutory Dues :-

a) The Income Tax Assessment of the Company have been completed up to Assessment Year 2007-2008. Disputed Income Tax Liabilities for which appeal is pending before different appellate authorities for Assessment Year 2000-2001 & 2006-2007 is Rs. 43.59 lacs.

b) Disputed Sales Tax Liability for which appeal is pending before Maharashtra Sales Tax Appellate Tribunal for Financial Year 1998-1999 is Rs. 7.01 lacs.

c) Disputed Central Excise liability for which appeal is pending before different excise authorities relating to financial year from 2005-2006 to 2008-2009 is Rs. 75.61 Lacs.

Based on the decision of the Appellate authorities and the interpretations of the other relevant provisions, the Company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision has been made.

d) Disputed liability on account of custom duty, current fees and interest thereon Rs. 25.59 Lacs has not been provided for as the Company has not acknowledged the debts.

3. SECURED LOAN :

i. Rupee Term loan from Canara Bank - Kolkata, Oriental Bank of Commerce - Kolkata and State Bank of Patiala - Mumbai is secured by

(a) an equitable mortgage ranking pari passu inter-se by deposit of title deeds of all the immovable properties of the company both present and future, relating to its spinning unit premises at Village : Yavluj, District : Kolhapur, Maharastra and

(b) by way of hypothecation ranking pari passu inter-se of all movable properties of the company both present and future including movable machineries, spares, tools & accessories (save & except book debts) subject to prior charges created or to be created in favour of the Companys Bankers, on its stock of Raw Materials, finished goods, consumable stores, book debts & such other movables as may be specifically permitted by the institutions in writing, to secure borrowings for working capital requirements and

(c) personal guarantee of some of the Directors of the Company.

ii. Working Capital Term Loan from Canara Bank, Overseas Branch, Kolkata is secured by way of :

(a) hypothecation of stock of Raw materials, Work-in-process, finished goods and book debts relating to spinning unit at Village : Yavluj, District: Kolhapur, Maharastra and stock-in-trade at trading unit Kolkata,

(b) Second charge on immovable properties of the company relating to above mentioned spinning unit, and

(c) personal guarantee of some of the Directors of the Company.

iii. Working Capital Loan from Canara Bank, Overseas Branch, Kolkata and Mumbai and Oriental Bank of Commerce, Overseas Branch, Kolkata are secured by way of :

(a) hypothecation of stock of Raw materials, Work-in-process, finished goods and book debts relating to spinning unit at Village : Yavluj, District : Kolhapur, Maharastra and stock-in-trade at trading unit Kolkata,

(b) Second charge on immovable properties of the company relating to above mentioned spinning unit, and

(c) personal guarantee of some of the Directors of the Company.

iv. Working Capital Loan from ING Vysya Bank Limited, Overseas Branch, Mumbai is secured by way of:

(a) hypothecation of stock of raw materials, work in process, Finished goods, book debts relating to spinning unit at Village : Yavluj, District: Kolhapur, Maharastra and

(b) Second charge on immovable Properties of the Company relating to above mentioned spinning unit, and

(c) personal guarantee of some of the Directors of the Company.

v. For the above loan a securitisation agreement entered in between the Company, AXIS Bank Limited and the above lenders.

vi. Term Loans repayable within one year Rs. 606.96 lacs (previous year Rs. 160.00 lacs). vii. Working Capital Term Loan repayable withing one year Rs. Nil.

4. Sales is net of Foreign Exchange difference Debit (Net) Rs. 7.88 lacs (Previous year Debit Rs 0.13 lacs.)

5. a) Sundry creditors includes outstanding dues to SSI undertakings amounting to Rs. 4,74,153/- (Previous year Rs. 4,34,645/-) and no dues are outstanding for more than 30 days. b) The Company has not received any information from its suppliers regarding registration under "The Micro, Small and Medium Enterprises Development Act, 2006." Hence the information required to be given in accordance with section 22 of the said Act, is not ascertainable. Hence, not disclosed.

6. Based on the information/documents available with the Company, there was no amount due and outstanding as on 31st March, 2010 which is to be transferred to Investors Education and Protection Fund under Section 205C of the Companies Act, 1956.

7. As per Accounting Standard 28 issued by the Institute of Chartered Accountants of India, the company has assessed recoverable value of generating unit based on value in used method which has worked out to be much higher than corresponding book value of net assets thereby not warranting further exercise of arriving at their net selling price. This further confirms absence of exigency of making any provision for impairment of asset(s).

8. Derivative Instruments

In view of notification Number G.S.R 225 (E) dated 31st March, 2010 issued by Ministry of Company Affairs, the Company opted to adjust the exchange differences arising on reporting of long term foreign exchange monetary items. Pursuant to exercise of aforesaid option the Company has debited Rs. 154.44- Lacs to "Foreign currency monetary item Transaction difference Account" that will amortised over the exercise of the option but not beyond 31st March, 2011.

The Company has also computed and made necessary provisions on account of leave encashment benefits based on acturial valuation as per Accounting Standard - 15 (Revised) "Employee Benefits". The total service eligibility as per the Companys leave rules are estimated and provided in the books as a revenue expenditure after making adjustment towards the benefit paid on this benefit obligation were carried out at 31st March, 2010.

Note : 1) Cotton Yarn production includes 3,19,687 Kgs (Previous Year 5,42,973 Kgs) and Knitted Fabrics Production includes Nil Kgs (Previous year 76 kgs) inter department transfer. 2) Shortage of Raw Cotton during the year Nil MT (Previous year 6 MT) and Cotton Yarn Nil Kgs (Previous Year 103 kgs).

Note : a) There is no doubtful debts as on 31.03.2010 hence no provision is made.

b) There is no amounts written off or written back during the year in respect of debts due from or to related parties.

9. Previous year figures have been regrouped and/or rearranged wherever necessary.