Notes to Accounts of Premier Synthetics Ltd.

Mar 31, 2024

Provisions: Provisions are recognised when there is a present obligation as result of a past event, it is
probable that an outflow of resources embodying economic benefits will be required to settle the
obligation and there is a reliable estimate of the amount of the obligation. Provisions are measured at
the best estimate of the expenditure required to settle the present obligation at the Balance Sheet date
and are not discounted to its present value.

Contingent Liabilities : Contingent liabilities are not provided for in the books but are disclosed by
way of notes in the financial statements when there is a possible obligation arising from past events,
the existence of which will be confirmed only by the occurrence or non occurrence of one or more
uncertain future events not wholly within the control of the company or a present obligation that arises
from past events where it is either not probable that an outflow of resources will be required to settle or
a reliable estimate of the amount cannot be made.

Contingent Assets: Contingent Assets are neither recognized nor disclosed in the financial
statements.

RELATED PARTY TRANSACTIONS

Related party transactions are transfer of resources or obligations between related parties, regardless of
whether a price is charged. Parties are considered to be related, if one party has the ability, directly or
indirectly, to control the other party of exercise significant influence over the other party in making
financial or operating decisions. Parties are considered to be related if they are subject to common control
or common significant influence.

REVENUE RECOGNITION

Revenue is recognised when control of the goods or services are transferred to the customer at an amount
that reflects the consideration to which the Company expects to be entitled in exchange for those goods or
services, regardless of when the payment is being made. Revenue is measured at the fair value of the
consideration received or receivable, taking into account contractually defined terms of payment. The
Company is the principal in all of its revenue arrangements since it is the primary obligor in all the
revenue arrangements as it has pricing latitude and is also exposed to inventory and credit risks. However,
Goods and Services tax (GST) are not received by the Company on its own account. Rather, it is tax
collected on value added to the commodity by the seller on behalf of the government. Accordingly, it is
excluded from revenue.

The specific recognition criteria from various stream of revenue is described below:

Sale of Goods:

Revenue from sales is recognised when the substantial risks and rewards of ownership of
goods are transferred to the buyer and the collection of the resulting receivables is reasonably
expected. Revenue from the sale of goods is measured at the fair value of the consideration
received or receivable, net of returns and allowances, trade discounts and volume rebates.

Rendering of Services:

Revenue from services rendered is recognised when the work is performed and as per the
terms of agreement.

Interest income:

Interest income from a financial asset is recognised when it is probable that the economic
benefits will flow to the Company and the amount of income can be measured reliably.
Interest income is accrued on a time basis. Interest income is accrued on a time basis, by reference to
the principal outstanding and at the effective interest rate applicable.

TAXATION

Tax expense for the period, comprising current tax and deferred tax, are included in the determination of
the net profit or loss for the period. Current tax is measured at the amount expected to be paid to the tax
authorities in accordance with the relevant prevailing tax laws.

Deferred tax is recognised for all the timing differences, subject to the consideration of prudence in
respect of deferred tax assets. Deferred tax assets are recognised and carried forward only to the extent
that there is a reasonable certainty that sufficient future taxable income will be available against which
such deferred tax assets can be realized. Deferred tax assets and liabilities are measured using the tax rates
and tax laws that have been enacted or substantively enacted by the Balance Sheet date. At each Balance
Sheet date, the Company re-assesses unrecognized deferred tax assets, if any.

Current tax assets and current tax liabilities are offset when there is a legally enforceable right to set off
the recognised amounts and there is an intention to settle the asset and the liability on a net basis.
Deferred tax assets and deferred tax liabilities are offset when there is a legally enforceable right to set off
assets against liabilities representing current tax and where the deferred tax assets and the deferred tax
liabilities relate to taxes on income levied by the same governing taxation laws.

EARNINGS PER SHARE (EPS)

The earnings considered in ascertaining the Company’s earnings per share comprise the net profit after
tax (and include post tax effect of any extraordinary items.) The number of shares used in computing
basic earnings per share is the weighted average number of shares outstanding during the period. The
number of shares used in computing diluted earnings per share comprises of the weighted average number
of shares outstanding during the period. The number of shares used in computing diluted earnings per
share comprises of the weighted average shares considered for deriving basic earning per share, and also
the weighted average number of equity shares which could have been issued on conversion of all dilutive
potential equity shares.

EMPLOYEE BENEFITS

Staff benefits arising out of retirement/death comprising contributions to Provident Fund, Gratuity
Scheme and other post separation benefits are accounted for on the basis of the schemes or by an
independent actuarial valuation at the year-end as the case may be.

The cost of the defined benefit plan and other post-employment benefits and the present value of such
obligation are determined using actuarial valuations. An actuarial valuation involves making various
assumptions that may differ from actual developments in the future. These include the determination of
the discount rate, future salary increases, mortality rates and attrition rate. Due to the complexities
involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to
changes in these assumptions. All assumptions are reviewed at each reporting date.

BORROWING COST

Borrowing costs that are attributable to the acquisition or construction of qualifying assets (assets which
require substantial period of time to get ready for its intended use) are capitalized as part of the cost of
that asset. All other borrowing costs are charged to the Statement of Profit and Loss for the period for
which they are incurred.

FINANCIAL INSTRUMENTS

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial
liability or equity instrument of another entity.

FINANCIAL ASSETS

Initial recognition and measurement

All financial assets are initially recognised when the Company becomes a party to the contractual
provisions of the instrument. All financial assets are initially measured at fair value plus, in the case
of financial assets not recorded at fair value through profit or loss, transaction costs that are
attributable to the acquisition of the financial asset.

Subsequent measurement

? Classification

For the purpose of subsequent measurement, the Company classifies financial assets in following
categories:

• Financial assets at amortized cost

Financial assets at amortized cost are subsequently measured at amortized cost using the
effective interest method. The amortized cost is reduced by impairment losses, if any. Interest
income and impairment are recognized in the Statement of Profit and Loss.

• Financial assets at fair value through other comprehensive income (FVTOCI)

These assets are subsequently measured at fair value through other comprehensive income
(OCI). Changes in fair values are recognized in OCI and on de-recognition, cumulative gain or
loss previously recognized in OCI is reclassified to the Statement of Profit and Loss. Interest
income calculated using EIR and impairment loss, if any, are recognized in the Statement of
Profit and Loss.

• Financial assets at fair value through profit or loss (FVTPL)

These assets are subsequently measured at fair value. Net gains and losses, including any
interest income, are recognized in the Statement of Profit and Loss.

Financial assets are not reclassified subsequent to their recognition except if and in the period the
Company changes its business model for managing for financial assets.

The Company de-recognizes a financial asset when the contractual rights to the cash flows from the
financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in
which substantially all of the risks and rewards of ownership of the financial asset are transferred or
in which the Company neither transfers nor retains substantially all of the risks and rewards of
ownership and it does not retain control of the financial asset.

If the Company enters into transactions whereby it transfers assets recognised on its balance sheet,
but retains either all or substantially all of the risks and rewards of the transferred assets, the
transferred assets are not de-recognised.

Any gain or loss on de-recognition is recognised in the Statement of Profit and Loss.

Impairment of financial assets

The Company applies the expected credit loss model for recognizing impairment loss on financial
assets measured at amortized cost, lease receivable, trade receivable other contractual rights to
receive cash or other financial assets. For trade receivable, the Company measures the loss
allowance at an amount equal to life time expected credit losses. Further, for the measuring life time
expected credit losses allowance for trade receivable the Company has used a practical expedient as
permitted under Indian AS 109. This expected credit loss allowance is computed based on
provisions, matrix which takes into account historical credit loss experience and adjusted for forward
looking information.

FINANCIAL LIABILITIES

Initial recognition and measurement

All financial liabilities are initially recognised when the Company becomes a party to the contractual
provisions of the instrument. All financial liabilities are initially measured at amortized cost unless at
initial recognition, they are classified as fair value through profit or loss. In case of trade payables
they are initially recognize at fair value and subsequently, these liabilities are held at amortized cost,
using the Effective interest method.

Classification and subsequent measurement

Financial liabilities are classified as measured at amortized cost or FVTPL.

A financial liability is classified as FVTPL if it is classified as held-for-trading, or it is a derivative
or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair
value and net gains and losses, including any interest expense, are recognised in the Statement of
Profit and Loss.

Financial liabilities other than classified as FVTPL, are subsequently measured at amortized cost
using the effective interest method. Interest expense is recognised in Statement of Profit and Loss.
Any gain or loss on de-recognition is also recognised in the Statement of Profit and Loss.

A financial liability is derecognized when the obligation under the liability is discharged or cancelled
or expires. When an existing financial liability is replaced by another from the same lender on
subsequently different terms, or the terms of an existing liability are subsequently modified, such an
exchange or modification is treated as the de-recognition of the original liability and the recognition
of the new liability. The difference in the respective carrying amount is recognize in the Statement of
Profit & Loss.

Offsetting of financial instruments

Financial assets and financial liabilities are offset and the net amount presented in the balance sheet
when, and only when, the Company currently has a legally enforceable right to set off the amounts
and it intends either to settle them on a net basis or to realize the assets and settle the liabilities
simultaneously.

Non-Current Assets held for Sale and Discontinued Operations

The Company classifies assets and operations as held for sale / distribution to owners or as
discontinued operations if their carrying amounts will be recovered principally through a sale /
distribution rather than through continuing use. Classification as a discontinued operations occurs
upon disposal or when the operation meets the below criteria, whichever is earlier.

Non-Current Assets are classified as held for sale only when both the conditions are satisfied -

1. The sale is highly probable, and

2. The asset or disposal group is available for immediate sale in its present condition subject only to
terms that are usual and customary for sale of such assets.

Non-current assets which are subject to depreciation are not depreciated or amortized once those
classified as held for sale.

A discontinued operation is a component of the Company’s business, the operations of which can be
clearly distinguished from those of the rest of the Company and

i) is part of a single coordinated plan to dispose of a separate major line of business or geographical
area of operations; or

ii) is a subsidiary acquired exclusively with a view to resale.

Non-current assets held for sale / distribution to owners and discontinued operations are measured at
the lower of their carrying amount and the fair value less costs to sell / distribute. Assets and
liabilities classified as held for sale / distribution are presented separately in the balance sheet. The
results of discontinued operations are excluded from the overall results of the Company and are
presented separately in the statement of profit and loss. Also, the comparative statement of profit and
loss is represented as if the operations had been discontinued from the start of the comparative
period.

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

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

The following methods and assumptions were used to estimate the fair values:

i) Long-term fixed-rate receivables/borrowings are evaluated by the Company based on parameters such as interest rates, specific country risk
factors, individual creditworthiness of the customer and the risk characteristics of the financed project. Based on this evaluation, allowances are taken
into^ccountfortheexpectedtossesofthesereceivables.

ii) Fair values of the Company’s interest-bearing borrowings and loans are determined by using DCF method using discount rate that reflects the
issuer’s borrowing rate as at the end of the reporting period. The own non- performance risk as at March 31, 2024 was assessed to be insignificant.

iii) The fair values of the unquoted equity shares, if any have been estimated using a discounted cash flow model. The valuation requires
management to make certain assumptions about the model inputs, including forecast cash flows, discount rate, credit risk and volatility, the
probabilities of the various estimates within the range can be reasonably assessed and are used in management''s estimate of fair value for these
unquoted equity investments.

"32" Financial Risk Management

The Company’s principal financial liabilities, comprise loans and borrowings, trade and other payables. The main purpose of these financial liabilities
is to finance the Company’s operations and to provide guarantees to support its operations. The Company’s principal financial assets include loans,
trade and other receivables, and cash and short-term deposits that derive directly from its operations.

The Company''s activities expose it to a variety of financial risks: credit risk, liquidity risk, foreign currency risk and interest rate risk. The Company''s
primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. The
primary market risk to the Company is foreign exchange risk. The Company uses foreign currency borrowings to mitigate foreign exchange related
risk exposures.

[The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below: |

Credit Risk

Credit risk is the risk of financial loss to the Company if a customer or counter party to a financial instrument fails to meet its contractual obligations,
and arises principally from the Company’s receivables from customers and investment securities. Credit risk arises from cash held with banks and
financial institutions, as well as credit exposure to clients, including outstanding accounts receivable. The maximum exposure to credit risk is equal to
the carrying value of the financial assets. The objective of managing counterparty credit risk is to prevent losses in financial assets. The Company
assesses the credit quality of the counter parties, taking into account their financial position, past experience and other factors.

Trade and other receivables

The Company''s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the customer,
including the default risk of the industry and country in which the customer operates, also has an influence on credit risk assessment. In addition,
receivable balances are monitered on an ongoing basis with the result that the Company''s exposure to Bad debt is not significant. Also the Company
does not enter into sales transaction with customers having credit loss history. There are no significant Credit risk with related parties of the
Company. The Company is exposed to Credit risk in the event of non payment of customers. Credit risk concentration with respect to Trade
Receivables is mitigated by the Company''s large customer base. Adequate expected credit losses are recognised as per the assessment.

The history of Trade receivables shows an allowance for bad and doubtful debts of Rs Nil ( Nil as at March 31,2023). The Company has made
allowance of Rs Nil ( Nil as at March 31,2024) against Trade receivable of Rs. 297.69 lacs ( Rs. 793.67 Lacs as at March 31,2023).

Bank Deposits

The company maintains its cash and cash equivalents and bank deposits with reputed and highly rated bank. Hence, there is no significant credit risk
onsuchdeposits.

Investments

The Company limits its exposure to credit risk by generally investing in liquid securities and only with counterparties that have a good credit rating.
The company does not expect any losses from non- performance by these counter-parties, and does not have any significant concentration of
exposures to specific industry sectors.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity
risk through credit limits with banks.

The Company’s corporate treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and
policies related to such risks are overseen by senior management.

"34" Segment Information

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker (CODM). The
CODM is considered to be the Board of Directors who makes strategic decisions and is responsible for allocating resources and assessing
performance of the operating segments.

Textile business is the Company''s only business segment ,hence the disclosure of segment wise information as required by Ind AS 108 on "Segment
Reporting" is not applicable .

"35" Discontinued Operations

During the quarter ended March 31, 2024, the Company had discontinued its manufacturing operations of cotton yarn from 01.01.2024 on permanent
basis and company has undertaken trading activity of cotton and cotton yarn. The company has undertaken sale of its movable fixed assets as
approved in the Extra-ordinary General Meeting and Subsequently approved in its Board Meeting held on 5th November,2023 and 13th February,
2024. Accordingly, the results of discontinued operations are disclosed seperately in the financial results. As the operations are discontinued, during
the quarter, the Company has assessed the recoverability of its movable Fixed Assets and other assets and recognized a provision aggregating to
Rs.95.20 lacs as loss on measurement to net realizable value

Note: 38 Disclosures as per Revised Schedule III to Companies Act, 2013

A) Title Deeds of Immovable Property not held in the name of Premier Synthetics Limited

The title deeds of all the immovable properties (other than properties where the company is the lessee and the leaseagreements are duly
executed in favour of the lessee), are held in the name of the company

B) Fair Valuation of Investment Property

The Company does not hold any Investment Property as on 31.03.2024

C) Revaluation of Property, Plant and Equipment and Right-of-Use Assets

The Company has not revalued its Property, Plant and Equipment and Right-of-Use Assets during the year.

D) Revaluation of Intangible Assets

The Company does not hold any intangible assets as on 31.03.2024

E) Loans or Advances to specified persons

The Company has not granted any Loans or Advances to promoters, directors, KMPs and other related parties (as defined under Companies
Act, 2013).

F) Details of Benami Property held

No proceedings have been initiated or pending against the Company for holding any Benami Property under the Benami Transactions
(Prohibition) Act, 1988 and the rules made thereunder.

G) Borrowings secured against current assets

Note: Working capital loan from Axis Bank of Rs.2,88,30,945/- as on March 31, 2024 having rate of interest of 9.60% is secured against
exclusive charge by way of hypothecation on the entire current assets of company (both present and future), Exclusive charge on immovable
property located at 10, Smrutikunj Society, Swastik Cross Road, Navrangpura, Ahmedabad-380009 and personal guarantee of security
provider. There are no material differences between quarterly statement of current assets filed by the company with banks and as per books
of accounts

H) Wilful Defaulter

Based on information available with the Company, the Company has not been declared as a Wilful defaulter by any bank or financial
institution.

I) Relationship with Struck off Companies

The Company has not entered into any transaction with companies struck off under section 248 of Companies Act, 2013 or section 560 of
Companies Act, 1956.

J) Registration of charges or satisfaction with Registrar of Companies (ROC)

Registration of charges or satisfaction has been done with ROC within the statutory date in all cases, wherever applicable.

K) Compliance with number of layers of companies

The Company does not have any subsidiary as envisaged under section 2 (87) of the Companies Act, 2013 read with Companies (Restriction
on number of Layers) Rules, 2017. Hence not applicable.

L) Undisclosed Transactions

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

M) Loan or Investment to Ultimate Beneficiaries

As stated & Confirmed by the Board of Directors, The Company has not advanced or loaned or invested funds to any other person(s)
or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

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

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

N) Loan or Investment from Ultimate Beneficiaries

As stated & Confirmed by the Board of Directors ,The Company has not received any fund from any person(s) or entity(ies), including
foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

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

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

O) Utilization of Term Loans

The company has not availed any term loan during the year

P) Crypto Currency

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

Q) Audit Trail

The company has used an accounting software for maintaining its books of account which has a feature of recording audit
trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software.

R) Commitments and contingencies

a) Capital commitments: NIL

b) Contigencies: NIL

Explanation for changes in the ratios by more than 25%

Current ratio has improved from 2.32 in FY2023 to 4.59 in FY2024 on account of repayment of short term borrowings and better working
⁽ⁱ⁾ capital management

(..) Debt Service Coverage Ratio has been diluted to -3.58 times in FY2024 as compared to 2.08 times on account of increased finance cost and

lower profitability during the year

Debt equity ratio has improved to 0.36 in FY2024 as compared to 0.49 in FY2023 on account of repayment of short term borrowing during

⁽ⁱⁱⁱ⁾ the year

Return on Equity (%), Net Profit Ratio (%) and Return on Capital Employed (%) has diluted in current year as compared to previous year on

(iv) account of lower profitabiltiy during the year

(v) Trade receivable turnover ratio and Trade payable turnover ratio has improved in FY2024 on account of better working capital management

The Company evaluates events and transactions that occur subsequent to the balance sheet date but prior to the approval of financial statements to
determine the necessity for recognition and/or reporting of any of these events and transactions in the financial statements.

The Board of Directors has recommended Preference dividend of Rs. 0.01 per share for the Financial Year 2023-24, which is subject to approval by
the shareholders.

"40" |Previous Year figures have been regrouped and recasted wherever necessary. |

"41" These financial statements have been approved oy the Board oi Directors oi the Company on May 28, 2024, ior issue to the shareholders ior their
adoption.

Signatures to Schedules 1 to 41

As per our report of even date attached For and on behalf of the Board

For Purushottam Khandelwal & Co.

Chartered Accountants

FRN : 123825W Gautamchand Surana Sachin Kansal

Managing Director Independent Director

CA Prahlad Jhanwar
Partner

Membership No. : 120920 Narayan D. Choudhary Vismay Makwana

Place : Ahmedabad Chief Financial Officer Company Secretary

Date : 28.05.2024

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Mar 31, 2015

1. The Secured Term Loans is secured by hypothecation of Stocks and Book Debts and first charge on the fixed assets of the Company and are personally guaranteed by Promoter Director of the Company Mr. Anand Arya

2. Due to default in their repayment and as settled with the asignee of the Institutional borrowings of the Company M/s Edelweiss Asset Reconstruction Co. Ltd the outstanding long term loan of Rs.990.37 lacs has been agreed to be repaid for Rs. 1777.50 lacs by 27/06/2015. The excess amount of Rs. 767.13 lacs to be repaid has been debited to Capita! Reserve,

3. Exceptional Items

Exceptional ltems(Previous Year-Nil) includes: The Exceptional items of Rs 51.07 lacs consist of Loss on sale of investment.

4. No Provision for taxation has boon made in view of the brought forwarded losses

5. Related Party Disclosures

As per Accounting Standard 18, the disclosures of transactions during the year with the related parties are given below: Related Parties/Nature of Relationship ;

Key Managerial Persons

Mr. Anand Arya

Mr. Suresh John

Mr. S. K. Tambswalla

Mr. Janardan Joshi

Associates

Blue Blends (India) Ltd.

Bindal Synthetics Pvt. Ltd Blue Blonds Leasing Pvt. Ltd.

Agrawal Synthetics.

Silvassa Span Yarn Industries.

Blue Blends Petrochemicals Ltd.

Cressida Traders Pvt. Ltd.

Murbad Syntax Pvt. Ltd. (Upto 18.12.2014)

Entwine Mobisoft Technologies Pvt. Lid.

Mr. Aman Arya Mrs. Indu Anand Arya

Disclosure in Respect of Material Related Party Transaction during the year

6. Segment Information

Textile business Is the Company's only business segment hence the disclosure of segment wise information as required by Accounting Standard (AS) 17 on 'Segment Reporting" Is not applicable.

7. Contingent Liabilities and Commitments

i) Claims by parties/customers not acknowledged as debts -Rs, 73.90 lakhs (Previous Year Rs.253.71 lakhs)

ii) Demand of Excise duty of Rs 14.40 lacs raised by the Commissioner of Central Excise, Ahmedabad for the years from 2001 to 2004 has been disputed and has not been provided in the books. The Company is In appeal against the same with the Central Excise and Service Tax Appellate Tribunal,Ahmedabad and has been legally advised that It will not have any liability .

However the company has deposited Rs. 3.60 lacs under protest with the respective Central Excise Authorities.

8. Balances of Sundry Debtors. Creditors, Loans and Advances and transactions are subject to their confirmation .

9. Except otherwise mentioned herein, In the opinion of the Board, the Current Assets, Loans and Advances are approximately of the value stated if realized in the ordinary course of business and the provision of all known liabilities are adequate and not in excess of the amount reasonably necessary

10. Subsquent to the date of balancesheet, Mr Gautamchand Kewatchand Surana.MrVikram Amritlal Sanghvi,Mr Rajiv Giriraj Bansal & Mr.Sanjaykumar Vinodbhai Majethia entered into Share Purchase Agreement with the present Promoters - Mr. Anand ChandutalArya, Mrs. irduAnand Arya & M/s Cressida Traders Pvt. Ltd.for acquisition of 23,35,000 equity shares of the company on 24th April, 2015. Accordingly, Public Announcement and Draft Open Offer to Public have been filed with BSE and 5EBI.

11. Previous Year figures have been regrouped and recasted wherever necessary,

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Mar 31, 2013

Method of Accounting

The financial statements are prepared under historical cost convention on an accrued basis and comply with the Accounting Standards (AS) issued by the Institute of Chartered Accountants of India (ICAI) referred to in Section 211 (3C) of the Companies Act, 1956.

"1" Exceptional Items

Exceptional Items includes:

i) Rs. 1697.83 lacs (Previous year Rs. Nil) of Capital Profit on sale of Company''s land at Navi Mumbai ii) Rs. 548.59 lacs (Previous year Rs. Nil) of Bad and Doubtful Debts and Advances written off and iii) Rs. Nil (Previous year Rs. 414.73 lacs) of interest liabilities written back on waiver of interest liabilities payable to Oman International Bank S.A.O.G as per negotiation made with them.

"2" The terms of Redemption of Preference Shares:

The arrears of dividend upto 31/03/2012 on the Preference shares as mentioned in Note no. 2(i) above are fully waived. Now these preference shares as mentioned in Note no. 2(i) and 2(H) above are redeemable on 30/09/2015 and carry Nil dividend.

"3" Related Party Disclosures

As per Accounting Standard 18, the disclosures of transactions with the related parties are given below:

Related Parties/Nature of Relationship :

Key Managerial Persons

Mr. Anand Arya

Mr. Suresh John

Mr. S. K.Tambawalla

Mr. Janardan Joshi

Associates

Blue Blends (India) Ltd.

Bindal Synthetics Pvt. Ltd

Blue Blends Leasing Pvt. Ltd.

Agarwal Synthetics.

Silvassa Span Yarn Industries.

Blue Blends Stocks & Securities Ltd.

Blue Blends Petrochemicals Ltd.

Blue Blends Finance Ltd.

Cressida Traders Pvt. Ltd.

Murbad Syntex Pvt. Ltd.

Blue Blends Equity Ltd.

Blue Blends Holdings Ltd.

Mr. Aman Arya

Mrs. Indu Anand Arya

Subsidiary Company (100%)

Premier Equity Ltd

"4" Segment Information

Textile business is the Company''s only business segment,hence the disclosure of segment wise information as required by Accounting Standard (AS) 17 on "Segment Reporting" is not applicable .

"5" Contingent Liabilities and Commitments

i) Guarantees extended by the Company on behalf of other companies Rs. 1500 lakhs (Previous Year Rs.2400 lakhs) ii) Claims by parties/customers not acknowledged as debts Rs. 253.71 lakhs (Previous Year Rs.253.71 lakhs)

"6" Balances of Sundry Debtors, Creditors, Loans and Advances are subject to confirmation and reconciliation, if any.

"7" Except otherwise mentioned herein, in the opinion of the Board, the Current Assets, Loans and Advances are approximately of the value stated if realized in the ordinary course of business and the provision of all known liabilities is adequate and not in excess of the amount reasonably necessary

"8" Previous reporting period figures have been regrouped and recasted wherever necessary.

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Mar 31, 2012

1. Contingent Liabilities and commitments not provided for-

As at 31.3.2012 As at 31.3.2011 (Rs. In lakhs) (Rs. In lakhs)

(i) ' Guarantees extended by the Company on behalf of other companies 2400.00 2400.00

(ii) Bank Guarantees given by the Company — -- 20.80

(iii) Claims by parties/customers not acknowledged as debts 253.71 250.36

2. The Company has determined the Sundry Debtors to the extent of Rs.1849.69 lakhs (Previous Year Rs. 1867.02 lakhs) as doubtful debts. However the Company has not made any provision for the same in expectation of the recovery.

3. Balances of Sundry Debtors, Creditors, Loans and Advances are subject to confirmation and reconciliation, if any.

4. Except otherwise mentioned herein, in the opinion of the Board, the Current Assets, Loans and Advances are approximately of the value stated if realized in the ordinary course of business and the provision of all known liabilities is adequate and not in excess of the amount reasonably necessary.

5. Exceptional Items includes amount of Rs. 414,73 lacs of interest liabilities written back and credit to profit and loss account and waiver of interest liabilities payable to Oman International Bank SAOG as per negotiation made with them during the current reporting period.

6. The terms of Redemption of Preference Shares: -

(i) 15% Redeemable Cumulative Non Convertible Preference Shares were redeemable at par in three equal annual installments from the end of 7th year from the date of allotment i.e. 18th' December 1996. However installments of redemption due by the year end date have not been paid.

(ii) 0 % Redeemable Cumulative Non Convertible Preference Shares were redeemable at par on the expiry of 10th year from the date of allotment i.e. on 4lrt November, 2009. However, the Company has not paid anything to such Preference Shareholders till the year end.

7. No depreciation is provided by the Company on its fixed assets situated in Its closed units.

8. The Company was declared a sick company by the Hon'ble Board for Industrial and Financial Reconstruction (BIFR) within the meaning of clause (0) of sub - section (1) of section 3 of the Sick Industrial Companies {Special Provisions) Act, 1985 vide its order dated 16.02.2006. The networth of the company has become positive during the current reporting period and the company is in the midst of making an application to come out of BIFR in the next hearing scheduled to be held on 03.05.2012 on the ground that it no more has negative networth.

9. The Company has recognized and created a deferred tax assets of Rs. 357.51 Lacs in respect of brought forward long term capital losses and depreciation of earlier year considering the possibility with reasonable certainty of their realization in subsequent years.

10. Segment Information

Textile business is the Company's only business segment; hence disclosure of segment-wise information is not applicable.

11. In absence of any business activity carried out by the only subsidiary company, consolidated financial statements have not been prepared.

12. Previous reporting period figures have been regrouped and recasted wherever necessary.

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Mar 31, 2011

1. Contingent Liabilities and commitments not provided for:-

As at 31.3.11 As at 31.3.10 (Rs. In lakhs) (Rs. In lakh)

(i) Guarantees extended by the Company on behalf of other companies 2400.00 2400.1

(ii) Bank Guarantees given by the Company 20.80 20.1

(iii) Claims by parties/customers not acknowledged as debts 250.36 250.1

2. The Company has determined the Sundry Debtors to the extent of Rs. 1867.02 lakhs (Previous Year Rs. 1867.59 lakhs) as doubtful det However the Company has not made any provision for the same in expectation of the recovery.

3. Balances of Sundry Debtors, Creditors, Loans and Advances are subject to confirmation and reconciliation, if any.

4. The Company has been negotiating with its lender Oman International Bank S.A.O.G. for settlement of its dues in respect of working cap facilities provided by them and as the Company does not foresee any further liability in respect of interest and overdue interest on such work capital facilities, it has not provided such interest amounting to Rs. 1790.39 lakhs (Previous Year: Rs. 1472.96 lakhs).

5. (i) All the Secured Term Loans from IFC! and Debentures privately placed with them including interest accrued and due together with underlying security interests, all rights, pledges and/or guarantee thereto, have been absolutely assigned and transferred unto in favoui Genuine Commercial Services Pvt. Ltd. in the F.Y. 2008-09 and all the secured loans from SASF (IDBI) and working capital loans from 1 Federal Bank Ltd. Including interest accrued and due thereon together with ail underlying security interests, all rights, pledges and guarantee thereto have been absolutely assigned and transferred unto in favour of Genuine Commercial Services Pvt, Ltd. in the F. 2009-10.

(ii) Exceptional items credited to Profit & Loss Account includes Rs. Nil in the current year (Rs. 57.63 Crores in the previous year) of writ! back of interest liabilities due on loans assigned to M/s Genuine Commercial Services Pvt. Ltd .which were waived as per the negotiat made with them in the previous year.

(iii) Adjustments in Principal amount of such assigned loans, if any, will be made at the time of final settlement/negotiation with M/s. Genu Commercial Service Pvt. Ltd.

6. Machineries in Company's Fabric Processing Unit at New Bombay have scraped and have been sold during the year.

7. Except otherwise mentioned herein, in the opinion of the Board, the Current Assets, Loans and Advances are approximately of the value stai if realized in the ordinary course of business and the provision of all known liabilities is adequate and not in excess of the amount reason necessary.

8. The terms of Redemption of Preference Shares:-

(i) 15% Redeemable Cumulative Non Convertible Preference Shares were redeemable at par in three equal annual installments from the s of 7th year from the date of allotment i.e. 18th December 1996. However installments of redemption due by the year end date have not be paid.

(ii) 0 % Redeemable Cumulative Non Convertible Preference Shares were redeemable at par on the expiry of 10th year from the date allotment i.e. on 4th November, 2009. However, the Company has not paid anything to such Preference Shareholders till the year end.

9. (i) The computation of Net Profit for the purpose of calculation of directors' remuneration under section 349 of the Companies Act, 19 is not enumerated, since no commission has been paid to any director.

10. The Company has not provided depreciation on fixed assets situated in its units at Baroda, Panoli & Daman, which are closed.

11. Related Party Transactions

Disclosures as required by Accounting Standard AS 18 "Related Party Disclosure" in respect of transaction for the year ended 31" March,2( are as under:- a) Relationship

(i) Subsidiary Company - Premier Equity Ltd.

12 Company's entire net worth stands eroded and it is a sick industrial company within the meaning of clause (o) of sub-section (1) of Section 3 of the Sick Industrial Companies (Special Provisions) Act, 1985. In the opinion of the Board, considering the present circumstances, reasonable certainty may not be expected about the future profitability of the Company.

In view of above, no provision has been made for deferred tax assets arising on account of timing differences due to carry forward accumulated business losses.

13. Segment Information

Textile business is the Company's only business segment; hence disclosure of segment-wise information is not applicable.

14. In absence of any business activity carried out by the only subsidiary company, consolidated financial statements have not been prepared.

15, Previous years figures have been regrouped and recasted wherever necessary.

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Mar 31, 2010

1. Contingent Liabilities and commitments not provided for:-

As at 31.3.2010 As at 31.3.2009 (Rs. In lakhs) (Rs. In lakhs}

(i) Guarantees extended by the Company on behalf of other companies 2400.00 2400.00

(ii) Bank Guarantees given by the Company 20.80 20.80

(iii) Claims by parties/ customers not acknowledged as debts Nil 2.00

2. The Company has determined the Sundry Debtors to the extent of Rs.1867.59 lakhs (Previous Year Rs. 1870.09 lakhs) as doubtful debts. However the Company has not made any provision for the same in expectation of the recovery.

3. Balances of Sundry Debtors, Creditors, Loans and Advances are subject to confirmation and reconciliation, if any.

4. The Company has been negotiating with its Lenders for settlement of its dues in respect of working capital facilities from them and as the Company does not foresee any liability in respect of interest and overdue interest on such working capital facilities, it has not provided such interest amounting to Rs. 1472.96 lakhs (Previous Year: Rs. 4284.08 lakhs).

5. (i) All the Secured Term Loan from IFCI and Debentures privately placed with them including interest accrued and due together with all underlying security interests, all rights, pledges and/or guarantee thereto, have been absolutely assigned and transferred unto in favour of Genuine Commercial Services Pvt. Ltd. during the F.Y. 2008-09 and similarly all the secured loan from SASF (IDBI) and working capital loans from The Federal Bank Ltd. Including interest accrued and due thereon together with all underlying security interests, all rights, pledges and/ or guarantee thereto have been absolutely assigned and transferred unto in favour of Genuine Commercial Services Pvt. Ltd.

(ii) In view of the negotiation after the Balance Sheet date with Genuine Commercial Services Pvt. Ltd the accrued and due interest as provided in the books amounting to Rs.57.63 crores on such assigned loans are not payable and hence they have been written back in the Books and credited to Profit & Loss account as exception item during the year.

(iii) Adjustments in Principal amount of such assigned loans, if any, will be made at the time of final settlement/negotiation with M/s. Genuine Commercial Service Pvt. Ltd.

6. Except otherwise mentioned herein, in the opinion of the Board, the Currenf Assets, Loans and Advances are approximately of the value stated if realized in the ordinary course of business and the provision of all known liabilities is adequate and not in excess of the amount reasonably necessary.

7. The terms of Redemption of Preference Shares: -

(i) 15% Redeemable Cumulative Non Convertible Preference Shares were redeemable at par in three equal annual installments from the end of 7th year from the date of allotment i.e. 18th December 1996. However installments of redemption due by the year end date have not been paid.

(ii) However, the Company has not redeemed the same and has not paid anything to such Preference Shareholders till the year end.

8. (i) The computation of Net Profit for the purpose of calculation of directors remuneration under section 349 of the Companies Act, 1956 is not enumerated, since no commission has been paid to any director

9. The Company has not provided depreciation on fixed assets situated at Baroda, Panoli & Daman, which are closed.

10. Related Party Transactions

Disclosures as required by Accounting Standard AS 18 "Related Party Disclosure" in respect of transaction for the year ended 31st March,2010 are as under:-

a) Relationship

(i) Subsidiary Company

- Premier Equity Ltd.

(ii) Associates

- Blue Blends (India) Ltd. - Bindal Synthetics Pvt. Ltd

- Blue Blends Leasing Pvt. Ltd. - Agrawal Synthetics.

- Silvassa Span Yarn industries. - Blue Blends Stocks & Securities Ltd.

- Blue Blends Petrochemicals Ltd. - Blue Blend Finance Ltd.

- Cressida Traders Pvt. Ltd. - Murbad Syntex Pvt. Ltd.

- Blue Blends Equity Ltd. - Blue Blends Holdings Ltd.

(iii) Key Persons

- Whole time Director : Mr. Anand Arya

- Executive Director : Mr. Suresh John

- Non-Executive Director : Mr. S.K. Tambawalla

- Non- Executive Director : Mr. Janardan Joshi

11. Companys entire networth stands eroded and it is a sick industrial company within the meaning of clause (o) of sub-section (1) of Section 3 of the Sick Industrial Companies (Special Provisions) Act, 1985. In the opinion of the Board, considering the present circumstances, reasonable certainty may not be expected about the future profitability of the Company.

In view of above, no provision has been made for deferred tax liability arising on account of timing differences in depreciation. Similarly, deferred tax assets arising on account of timing differences due to carry forward accumulated business losses and other provisions has not been adjusted

12. Segment Information

Textile business is the Companys only business segment; hence disclosure of segment-wise information is not applicable.

13. In absence of any business activity carried out by the only subsidiary company, consolidated financial statements have not been prepared.