Notes to Accounts of Sonal Adhesives Ltd.

Mar 31, 2024

(p) Provisions, contingent liabilities and contingent assets

Provisions are recognized when the Company has a present obligation as a result of a past event; it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and when a reliable estimate of the amount of the obligation can be made. Provisions are measured at the best estimate of the expenditure required to settle the present obligation at the standalone balance sheet date. The expenses relating to a provision is presented in the Statement of profit and loss net of any reimbursement.

If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows specific to the liability. The discount rate used to determine the present value is a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognised as finance cost.

Contingent liabilities are disclosed 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 the obligation or a reliable estimate of the amount cannot be made.

A contingent asset is not recognised till the realization of the income is virtually certain.

Provisions, contingent assets, contingent liabilities and commitments are reviewed at each standalone balance sheet date.

(q) Earnings per share (EPS)

Basic EPS 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.

Diluted EPS is computed by dividing the net profit for the year by the weighted average number of equity shares outstanding during the year as adjusted for the effects of all dilutive potential equity shares, except where the results are anti-dilutive. The dilutive potential equity shares are adjusted for the proceeds receivable had the equity shares been actually issued at fair value (i.e. the average market value of the outstanding equity shares). Dilutive potential equity shares are deemed converted as at the beginning of the period, unless issued at a later date. Dilutive potential equity shares are determined independently for each period presented.

The number of equity shares and potentially dilutive equity shares are adjusted retrospectively for all periods presented for any share splits and bonus shares issues including for changes effected prior to the approval of the financial statements by the Board of Directors.

(r) Dividend

The final dividend on shares is recorded as a liability on the date of approval by the shareholders and interim dividends are recorded as a liability on the date of declaration by the Company''s Board of Directors.

(s) Foreign currency transactions

In preparing the financial statements of the Company, transactions in currencies other than the Company''s functional currency (foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are translated at the rates prevailing at the reporting date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at 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 on monetary items are recognized in the Statement of profit and loss in the period in which they arise.

(t) Segment Reporting

The Board of Directors of the Company have been identified as the Chief Operating Decision Maker (CODM) by the Company. Operating segments are reported in a manner consistent with the internal reporting provided to the CODM of the Company. The CODM assesses the financial performance and position of the Company as a whole, and makes strategic decisions.

The Company is primarily engaged in ''Manufacturing of Packing Material'' business, which in the terms of Ind AS 108 on ''Operating Segments'' constitutes a single reporting segment which is also reviewed by the Chief Operating Decision Maker (CODM). Accordingly, information required to be presented under Ind AS-108 Operating Segments has been given.

(u) Fair Value Measurements

The Company measures financial instrument at fair value at each standalone balance sheet date. Fair value is the price that would receive to sell an asset or paid to transfer a liability in an orderly transaction between market participant at the measurement date.

The fair values of the financial assets and liabilities are 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:

1. Fair value of cash and deposits, trade and other receivables, trade payables, other current liabilities, short term loans from banks approximate their carrying amounts largely due to short term maturities of these instruments.

2. The fair values of non-current borrowings are based on discounted cash flows using a current borrowing rate. They are classified as level 3 fair values in the fair value hierarchy due to the use of unobservable inputs, including own credit risk.

3. For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to the fair values.

The Company uses the fair value hierarchy for determining and disclosing the fair value of financial instruments.

If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

The Company recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

(v) Significant accounting judgement, estimates and assumption

The preparation of financial statements requires Management to make judgments, estimates and assumptions in the application of accounting policies that affect the reported amounts of assets, liabilities, income, and expenses. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. Continuous evaluation is done on the estimation and judgments based on historical experience and other factors, including expectations of future events that are believed to be reasonable.

Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods of the revision if it affects both current and future periods.

Information about critical judgments in applying accounting policies, as well as estimates and assumptions that have the most significant effect to the carrying amounts of assets and liabilities within the next financial year, are as follows:

- Determination of the estimated useful lives of tangible assets and the assessment as to which components of the cost may be capitalized

- Determination of the estimated useful lives of intangible assets

- Recognition and measurement of defined benefit obligations

- Discounting of long-term financial liabilities

- Fair value of financial instruments

- Recognition and measurement of provisions and contingencies, key assumptions about the likelihood and magnitude of an outflow of resources

- Measurement of Expected credit losses, provision for inventory, return liability, Commission, etc.

- Revenue recognition

- Regognition of deferred tax assets/liability

- Impairment of financial assets

(w) Changes in material accounting policy information

The Company has applied new standards, interpretations and amendments issued and effective for annual periods beginning on or after 01 April 2023. This did not have any material changes in the Company''s standalone accounting policies

(x) New and amended standards

The Company applied for the first-time certain standards and amendments, which are effective for annual periods beginning on or after 01 April 2023.

The Ministry of Corporate Affairs has notified Companies (Indian Accounting Standards) Rules, 2015 by issuing the Companies (Indian Accounting Standards) Amendment Rules, 2023, applicable from 01 April 2023, as below:

1. Definition of Accounting Estimates - Amendments to Ind AS 8:

The amendments to Ind AS 8 clarify the distinction between changes in accounting estimates, changes in accounting policies and the correction of errors. They also clarify how entities use measurement techniques and inputs to develop accounting estimates. The amendments had no impact on the Company''s standalone financial statements

2. Disclosure of Accounting Policies - Amendments to Ind AS 1:

The amendments to Ind AS 1 provided guidance and examples to help entities apply materiality judgements to accounting policy disclosures. The amendments aim to help entities provide accounting policy disclosures that are more useful by replacing the requirement for entities to disclose their ''significant'' accounting policies with a requirement to disclose their ''material'' accounting policies and adding guidance on how entities apply the concept of materiality in making decisions about accounting policy disclosures. The amendments had an impact on the Company''s disclosures of accounting policies, but not on the measurement, recognition or presentation of any items in the Company''s standalone financial statements.

3. Deferred Tax related to Assets and Liabilities arising from a Single Transaction - Amendments to Ind AS 12:

The amendments to Ind AS 12 Income Tax narrow the scope of the initial recognition exception, so that it no longer applies to transactions that give rise to equal taxable and deductible temporary differences such as leases and decommissioning liabilities. The amendments had no impact on the Company''s financial statements.

(y) Recent Indian Accounting Standards (Ind AS) issued not yet effective

Ministry of Corporate Affairs (“MCA”) notifies new standard or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. On 31 March 2024, MCA has not notified any new standards or amendments to the existing standards applicable to the Company

(z) The material accounting policy information used in preparation of the financial statements have been discussed in the respective notes.

Note 31: Employee Benefits 1) Defined contribution plans :

The Company participates in a number of defined contribution plans on behalf of relevant personnel. Any expense recognised in relation to these schemes represents the value of contributions payable during the period by the Company at rates specified by the rules of those plans. The only amounts included in the balance sheet are those relating to the prior months contributions that were not due to be paid until after the end of the reporting period.

The major defined contribution plans operated by the Company are as below:

a) Provident fund and pension

In accordance with the Employee''s Provident Fund and Miscellaneous Provisions Act, 1952 eligible employees of the Company are entitled to receive benefits in respect of provident fund, a defined contribution plan, in which both employees and the Company make monthly contributions at a specified percentage of the covered employees'' salary. The contributions, as specified under the law, are made to the provident fund administered and managed by Government of India. The Company has no further obligations under the fund managed by the GOI beyond its monthly contributions which are charged to the Statement of Profit and Loss in the period they are incurred. The benefits are paid to employees on their retirement or resignation from the Company.

Contribution to Defined Contribution Plans, recognised in the Statement of Profit and Loss for the year under employee benefits expense, are as under :

b) Defined Benefit Plans Gratuity (Unfunded)

The Company has an obligation towards gratuity, an unfunded defined benefit retirement plan covering eligible employees. The plan provides for lump sum payment to vested employees at retirement, death while in employment or on termination of the employment of an amount equivalent to 15 days salary, as applicable, payable for each completed year of service, without any payment ceiling. Vesting occurs upon completion of five years of service. The Company accounts for the liability for gratuity benefits payable in the future based on an actuarial valuation.

The Company offers the following employee benefit schemes to its employees:

Gratuity (included as part of gratuity in Note 21 Employee benefits expense)

The Company''s business activities are exposed to a variety of financial risks, namely Credit risk, Liquidity risk, Currency risk, Interest risks and Commodity price risk. The Company''s Senior Management has the overall responsibility for establishing and governing the Company''s risk management framework.he Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits.

Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company''s activities. The Company monitors and manages the financial risks relating to the operations of the entity through internal risk reports which analyse exposures by degree and magnitude of the risk.

(iii) (a) Market Risk

Market risk is the risk that changes in market prices - such as foreign exchange rates, interest rates and equity prices - will affect the Company''s income or the value of its holdings of financial instruments. Market risk is attributable to all market risk sensitive financial instruments including foreign currency receivables and payables and long term debt. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.

The Company''s is currently not exposed to market risk in the reporting period.

(iii) (b) Credit risk management

Credit risk is the risk 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''s receivables from customers and loans and advances.

The carrying amount of following financial assets represents the maximum credit exposure:

Trade Receivable & Staff Loan: Credit risk is the risk that the counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The company is exposed to credit risk from its operating activities (primarily trade receivables), deposits with banks and staff loan. The company has a trade policy approved by the Management that is designed to ensure consistent processes are in place to measure and control credit risks.

The company has trade relations with reputed third parties. The receivables are constantly managed through credit approvals, establish credit limits and continuously monitoring the credit worthiness of customers. The company follows the market norms in terms of its credit policy. The credit terms offered to export customers is around 120-150 days and 30 to 60 days to the customers in the domestic market. The company''s historical experience of collecting receivables, supported by the level of default is that the credit risk is low across territories and so trade receivables are considered to be a single class of financial assets. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in the financial statements.

Ultimate responsibility for liquidity risk management rests with the management, which has established an appropriate liquidity risk management framework for the Company''s short-term, medium-term and long-term funding and liquidity management requirements. The Company manages liquidity risk by continuously monitoring forecast and actual cash flows.

Liquidity risk tables

The following tables detail the Company''s remaining contractual maturity for its financial liabilities with agreed repayment periods. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay.

Note 41 : Additional Regulatory Information (Not applicable disclosures)

a) The Company does not own benami properties. Further, there are no proceedings which have been initiated or are pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.

b) During the current and previous periods, the Company has not traded or invested in Crypto currency or Virtual Currency.

c) There were no Scheme of Arrangements entered by the Company during the current and previous, which required approval from the Competent Authority in terms of sections 230 to 237 of the Companies Act, 2013.

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

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

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

e) 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

f) The Company has no direct whollely owned subisdiaries and accordingly, the Company is compliant with the number of layers prescribed under clause (87) of section 2 of the Act read with the Companies (Restriction on number of Layers) Rules, 2017).

Note 42: Audit Trail

The Company is maintaining its books of account which has feature of recording audit trail of each and every transaction, creating an edit log of each change made in books of account along with the date when such changes were made and ensuring that the audit trail cannot be disabled, throughout the year as required by proviso to sub rule (1) of rule 3 of The Companies (Accounts) Rules, 2014 known as the Companies (Accounts) Amendment Rules, 2021.

Note 43: Disclosure as per Section 186 of the Companies Act, 2013

The details of loans, guarantees and investments under Section 186 of the Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014 are as follows:

(i) There are no investments, securities and guarantees provided and no guarantees given during the year.

Note 44:- Previous year''s figures have been regrouped wherever necessary, to conform to the current year''s classification.

Note 45:- The balance shown in Sundry Debtors, Sundry Creditors, Advances, are subject to confirmation from respective parties

See accompanying notes forming part of the financial statements.

In terms of our report attached

M. C. Asawa & Co. For Sonal Adhesives Limited

Chartered Accountants

Firm Registration No : 008041C Sd/- Sd/-

Sandeep Arora Manish Nanda

Mukund Sarda Managing Director Director

Proprietor DIN: 00176939 DIN: 03245943

Membership No.: 163405

Sd/- Sd/-

Anuradha Dubey Ajeet Singh

Company Secretary Chief Financial Officer

A65278 BMTPS7181Q

Place: Khopoli Place: Khopoli

Date: 28th May, 2024 Date: 28th May, 2024

---

Mar 31, 2023

(n) Provisions, contingent liabilities and contingent assets

Provisions are recognized when the Company has a present obligation as a result of a past event; it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and when a reliable estimate of the amount of the obligation can be made. Provisions are measured at the best estimate of the expenditure required to settle the present obligation at the standalone balance sheet date. The expenses relating to a provision is presented in the Statement of profit and loss net of any reimbursement.

If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows specific to the liability. The discount rate used to determine the present value is a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognised as finance cost.

Contingent liabilities are disclosed 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 the obligation or a reliable estimate of the amount cannot be made.

A contingent asset is not recognised but disclosed in the financial statements where an inflow of economic benefit is probable.

Our capital commitments and contingent obligations were comprised primarily of our Bank Guarantee and Tax dues. Provisions, contingent assets, contingent liabilities and commitments are reviewed at each standalone balance sheet date.

(o) Earnings per share (EPS)

Basic EPS 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.

Diluted EPS is computed by dividing the net profit for the year by the weighted average number of equity shares outstanding during the year as adjusted for the effects of all dilutive potential equity shares, except where the results are anti-dilutive. The dilutive potential equity shares are adjusted for the proceeds receivable had the equity shares been actually issued at fair value (i.e. the average market value of the outstanding equity shares). Dilutive potential equity shares are deemed converted as at the beginning of the period, unless issued at a later date. Dilutive potential equity shares are determined independently for each period presented.

The number of equity shares and potentially dilutive equity shares are adjusted retrospectively for all periods presented for any share splits and bonus shares issues including for changes effected prior to the approval of the financial statements by the Board of Directors.

(p) Dividend

The final dividend on shares is recorded as a liability on the date of approval by the shareholders and interim dividends are recorded as a liability on the date of declaration by the Company''s Board of Directors.

(q) Foreign currency transactions

In preparing the financial statements of the Company, transactions in currencies other than the Company''s functional currency (foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are translated at the rates prevailing at the reporting date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at 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 on monetary items are recognized in the Statement of profit and loss in the period in which they arise.

(r) Segment Reporting

The Board of Directors of the Company have been identified as the Chief Operating Decision Maker (CODM) by the Company. Operating segments are reported in a manner consistent with the internal reporting provided to the CODM of the Company. The CODM assesses the financial performance and position of the Company as a whole, and makes strategic decisions.

The Company is primarily engaged in ''Manufacturing of BOPP Tapes'' business, which in the terms of Ind AS 108 on ''Operating Segments'' constitutes a single reporting segment which is also reviewed by the Chief Operating Decision Maker (CODM). Accordingly, information required to be presented under Ind AS-108 Operating Segments has been given.

(s) Fair Value Measurements

The Company measures financial instrument at fair value at each standalone balance sheet date. Fair value is the price that would receive to sell an asset or paid to transfer a liability in an orderly transaction between market participant at the measurement date.

The fair values of the financial assets and liabilities are 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:

1. Fair value of cash and deposits, trade and other receivables, trade payables, other current liabilities, short term loans from banks approximate their carrying amounts largely due to short term maturities of these instruments.

2. The fair values of non-current borrowings are based on discounted cash flows using a current borrowing rate. They are classified as level 3 fair values in the fair value hierarchy due to the use of unobservable inputs, including own credit risk.

3. For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to the fair values.

The Company uses the fair value hierarchy for determining and disclosing the fair value of financial instruments.

If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

The Company recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

(t) Significant accounting judgement, estimates and assumption

The preparation of financial statements requires Management to make judgments, estimates and assumptions in the application of accounting policies that affect the reported amounts of assets, liabilities, income, and expenses. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. Continuous evaluation is done on the estimation and judgments based on historical experience and other factors, including expectations of future events that are believed to be reasonable.

Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods of the revision if it affects both current and future periods.

Information about critical judgments in applying accounting policies, as well as estimates and assumptions that have the most significant effect to the carrying amounts of assets and liabilities within the next financial year, are as follows:

- Determination of the estimated useful lives of tangible assets and the assessment as to which components of the cost may be capitalized [note 2(c)]

- Determination of the estimated useful lives of intangible assets [note 2(c)]

- Recognition and measurement of defined benefit obligations [note 2(j)]

- Discounting of long-term financial liabilities

- Fair value of financial instruments [note 2(s)]

- Recognition and measurement of provisions and contingencies, key assumptions about the likelihood and magnitude of an outflow of resources [note 2(t)]

- Measurement of Expected credit losses, provision for inventory, return liability, Commission, etc.

(u) Adoption of new and revised standards

The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the preparation of the Company''s annual financial statements for the year ended March 31,2022, except for amendments to the existing Indian Accounting standards (Ind AS).

The Ministry of Corporate Affairs has notified Companies (Indian Accounting Standard) Amendment Rules 2022 dated March 23, 2022, to amend the following Ind AS which are effective from April 01, 2022:

(i) Onerous Contracts - Costs of Fulfilling a Contract - Amendments to Ind AS 37

(ii) Reference to the Conceptual Framework - Amendments to Ind AS 103

(iii) Property, Plant and Equipment: Proceeds before Intended Use - Amendments to Ind AS 16

(iv) Ind AS 101 First-time Adoption of Indian Accounting Standards - Subsidiary as a first-time adopter

(v) Ind AS 109 Financial Instruments - Fees in the ''10 per cent'' test for derecognition of financial liabilities

(vi) Ind AS 41 Agriculture - Taxation in fair value measurements”

The Company has evaluated the above amendments for the accounting period beginning on or after 1st April 2022 and these do not have an impact on the financial statements of the Company.

On March 31, 2023, the Ministry of Corporate Affairs (MCA) has notified Companies (Indian Accounting Standards) Amendment Rules, 2023. This notification has resulted into following amendments in the existing Accounting Standards which are applicable from April 1, 2023.

(i) Ind AS 101 - First time adoption of Ind AS - modification relating to recognition of deferred tax asset by a first-time adopter associated with (a) right to use assets and related liabilities and (b) decommissioning, restoration and similar liabilities and corresponding amounts recognised as cost of the related assets.

(ii) Ind AS 102 - Share-based Payment - modification relating to adjustment after vesting date to the fair value of equity instruments granted.

(iii) Ind AS 103 - Business Combination - modification relating to disclosures to be made in the first financial statements following a business combination.

(iv) Ind AS 107 - Financial Instruments Disclosures - modification relating to disclosure of material accounting policies including information about basis of measurement of financial instruments.

(v) Ind AS 109 - Financial Instruments - modification relating to reassessment of embedded derivatives.

(vi) Ind AS 1 - Presentation of Financials Statements - modification relating to disclosure of ''material accounting policy information'' in place of ''significant accounting policies''.

(vii) Ind AS 8 - Accounting Policies, Change in Accounting Estimates and Errors - modification of definition of ''accounting estimate'' and application of changes in accounting estimates.

(viii) Ind AS 12 - Income Taxes - modification relating to recognition of deferred tax liabilities and deferred tax assets.

(ix) Ind AS 34 - Interim Financial Reporting - modification in interim financial reporting relating to disclosure of ''material accounting policy information'' in place of ''significant accounting policies''.

The Company is evaluating the amendments and the expected impact, if any, on the Company''s financial statements on application of the amendments for annual reporting periods beginning on or after 1 April 2023.

(iii) Rights, preferences and restrictions attached to shares:

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

In the event of liquidation, the Equity Shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

(iv) During the period of five years immediately preceding the reporting date:

(a) The Company has not issued any shares pursuant to contract(s) without payment being received in cash.

(b) The Company has not allotted any shares as fully paid up by way of bonus shares.

(c) The Company has not bought back any shares.

(Rs. in LaKns)

Note 26: Employee Benefits 1) Defined contribution plans :

The Company participates in a number of defined contribution plans on behalf of relevant personnel. Any expense recognised in relation to these schemes represents the value of contributions payable during the period by the Company at rates specified by the rules of those plans. The only amounts included in the balance sheet are those relating to the prior months contributions that were not due to be paid until after the end of the reporting period.

The major defined contribution plans operated by the Company are as below:

a) Provident fund and pension

In accordance with the Employee''s Provident Fund and Miscellaneous Provisions Act, 1952 eligible employees of the Company are entitled to receive benefits in respect of provident fund, a defined contribution plan, in which both employees and the Company make monthly contributions at a specified percentage of the covered employees'' salary. The contributions, as specified under the law, are made to the provident fund administered and managed by Government of India. The Company has no further obligations under the fund managed by the GOI beyond its monthly contributions which are charged to the Statement of Profit and Loss in the period they are incurred. The benefits are paid to employees on their retirement or resignation from the Company.

Contribution to Defined Contribution Plans, recognised in the Statement of Profit and Loss for the year under employee benefits expense, are as under :

(i) Capital management

For the purpose of the Company''s capital management, capital includes issued capital and all other equity reserves attributable to the equity shareholders of the Company. The primary objective of the Company when managing capital is to safeguard its ability to continue as a going concern and to maintain an optimal capital structure so as to maximize shareholder value.

As at March 31st, 2023, the capital structure of the company consists of net debt (borrowings as detailed in Note 15 offset by cash and cash equivalents) and total equity of the company.

The company is not subject to any externally imposed capital requirements.

In order to maintain or achieve an optimal capital structure, the Company reviews its capital on semi annual basis. As a part of review the company considers the cost of capital and the risks associated with each class of capital.

^ ri D oti a

(iii) Financial risk management objectives

The Company''s business activities are exposed to a variety of financial risks, namely Credit risk, Liquidity risk, Currency risk, Interest risks and Commodity price risk. The Company''s Senior Management has the overall responsibility for establishing and governing the Company''s risk management framework.he Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits.

Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company''s activities. The Company monitors and manages the financial risks relating to the operations of the entity through internal risk reports which analyse exposures by degree and magnitude of the risk.

(iii) (a) Market Risk

Market risk is the risk that changes in market prices - such as foreign exchange rates, interest rates and equity prices - will affect the Company''s income or the value of its holdings of financial instruments. Market risk is attributable to all market risk sensitive financial instruments including foreign currency receivables and payables and long term debt. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.

The Company''s is currently not exposed to market risk in the reporting period.

(iii) (b) Credit risk management

Credit risk is the risk 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''s receivables from customers and loans and advances.

The carrying amount of following financial assets represents the maximum credit exposure:

Trade Receivable & Staff Loan: Credit risk is the risk that the counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The company is exposed to credit risk from its operating activities (primarily trade receivables), deposits with banks and staff loan. The company has a trade policy approved by the Management that is designed to ensure consistent processes are in place to measure and control credit risks.

The company has trade relations with reputed third parties. The receivables are constantly managed through credit approvals, establish credit limits and continuously monitoring the credit worthiness of customers. The company follows the market norms in terms of its credit policy. The credit terms offered to export customers is around 120-150 days and 30 to 60 days to the customers in the domestic market. The company''s historical experience of collecting receivables, supported by the level of default is that the credit risk is low across territories and so trade receivables are considered to be a single class of financial assets. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in the financial statements.

(iii) (c) Liquidity risk management

Ultimate responsibility for liquidity risk management rests with the management, which has established an appropriate liquidity risk management framework for the Company''s short-term, medium-term and long-term funding and liquidity management requirements. The Company manages liquidity risk by continuously monitoring forecast and actual cash flows.

Liquidity risk tables

The following tables detail the Company''s remaining contractual maturity for its financial liabilities with agreed repayment periods. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay.

Note 36 : Additional Regulatory Information (Not applicable disclosures)

a) The Company does not own benami properties. Further, there are no proceedings which have been initiated or are pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.

b) During the current and previous periods, the Company has not traded or invested in Crypto currency or Virtual Currency.

c) There were no Scheme of Arrangements entered by the Company during the current and previous, which required approval from the Competent Authority in terms of sections 230 to 237 of the Companies Act, 2013.

The Company has no direct whollely owned subisdiaries and accordingly, the Company is compliant with the number of layers prescribed under clause (87) of section 2 of the Act read with the Companies (Restriction on number of Layers) Rules, 2017).

Relationship with struck-off companies

Name of struck off Company:

Relationship with struck off Company: Investment in Equity Shares of the Company without exercising significant influence over management

Nature of transactions with struck-off Company Balance outstanding

Investments in securities -

Receivables -

Payables -

Shares held by stuck off Company

Other outstanding balances (to be specified) -

Note 36: Disclosure as per Section 186 of the Companies Act, 2013

The details of loans, guarantees and investments under Section 186 of the Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014 are as follows:

(i) There are no investments, securities and guarantees provided and no guarantees given during the year.

Note 37:- Previous year''s figures have been regrouped wherever necessary, to conform to the current year''s classification.

Note 38:- The balance shown in Sundry Debtors, Sundry Creditors, Advances, are subject to confirmation from respective parties

See accompanying notes forming part of the financial statements.

In terms of our report attached

M. C. Asawa & Co. For Sonal Adhesives Limited

Chartered Accountants

Firm Registration No : 008041C Sd/- Sd/-

Sandeep Arora Manish Nanda

Mukund Sarda Managing Director Director

Proprietor DIN: 00176939 DIN: 03245943

Membership No.: 163405

Sd/- Sd/-

Anuradha Dubey Ajeet Singh

Company Secretary Chief Financial Officer

A65278 BMTPS7181Q

Place: Khopoli Place: Khopoli

Date: 29th May, 2023 Date: 29th May, 2023

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Mar 31, 2015

1. Rights, preferences and restrictions attached to shares:

Equity Shares:

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

In the event of liquidation, the Equity Shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

2. During the period of five years immediately preceding the reporting date:

(i) The Company has not issued any shares pursuant to contract(s) without payment being received in cash. (ii) The Company has not allotted any shares as fully paid up by way of bonus shares. (iii) The Company has not bought back any shares.

As per the records of the Company, including its register of shareholders/members and other declarations received from the shareholders regarding the beneficial interest, the above shareholding represents both legal and beneficial ownerships of shares.

3. Term Loan from Bank comprising Rs 2,68,67,145 [Previous Year: Rs 3,59,53,310], including Current Maturities of Long Term Debt Rs 1,20,00,000 [Previous Year: 84,00,000] are secured by:

(a) Equitable mortgage of land & building situated thereon at Gat No 232/2, Survey No 28, admeasuring 3860 sq mtrs, Hissa 1A, Village Dheku, Taluka Khalapur, District Raigad, Maharashtra

(b) Equitable mortgage of land & building situated thereon at Gat No 232/1, Survey No 28, admeasuring 2160 sq mtrs, Hissa 1A, Village Dheku, Taluka Khalapur, District Raigad, Maharashtra, owned by Sonal Ropes Limited

(c) Equitable mortgage of property at Ground Floor, "C" Wing, Bhagwati Building, FP Nos 18 - 19 / 34 A, B, C and 35 A, B, C TPS VI and CTS No 1610 / 27 & 1610 / 28 of Santacruz West, Linking Road, Extension Road, Mumbai 400054, owned by Sandeep Arora and Mridu Arora.

(d) Equitable mortgage of residential fat at 11th Floor, Morya Heights, Plot No 15, 16 and 17, Near Sanjeevani International School, Sector - 18, Kharghar, Navi Mumbai , District Raigad, owned by Sonal Impex Limited.

(e) Equitable mortgage of industrial property situation at Gut No 236 (1), House No 142, Village Dheku, off Takai - Adoshi Road, District Raigad, owned by Sonal Impex Limited

(f) Mortgage of immovable property situated at Abhishek Bungalow No 4, Four Bungalows, Andheri West, Mumbai 400 053, owned by director, towards enhanced mortgage debt.

(g) Hypothecation of existing fixed assets of the Company.

(h) Hypothecation of plant and machinery of Sonal Ropes Limited at written down values. (i) Cash collateral or immovable property valuing at Rs 0.50 crores. (j) Third party guarantee of:

- Sandeep Mohanlal Arora, Kamal Arora and Mridu Arora

- Corporate Guarantee of Sonal Impex Limited and Sonal Ropes Limited

(k) Hypothecation of current assets, including stocks, receivables, consumables, stores and spares and movable plant and machinery.

(l) Hypothecation of machines purchased out of bank fnance

4. Vehicle loan of Rs. 14,34,084 (Previous Year: Rs 9,88,922) comprising Rs. 5,60,977 (Previous Year Rs. Rs 3,63,940) classified as current maturities of long term borrowings included under other current liabilities is secured by way of hypothecation of vehicle financed.

5. Sales Tax Deferral Loans from the Government of Maharashtra are repayable as per the schedule provided by the Government of Maharashtra.

6. Working capital loans from bank comprise Cash Credit, and EPC, which are secured by:

(a) Hypothecation of Company's stocks of raw materials, fished goods, SIP of finished goods of proposed manufacturing activity in factory, go down, in transit or lying elsewhere.

(b) Charge on Company's receivables, book debts and other actionable claims.

(c) Rate of interest - Base rate 7% on daily products with monthly rests

7. The Company has not received any intimation from its suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence, the disclosures, if any, relating to the amounts unpaid as at the year end together with the interest paid / payable, if any, as required under the said Act have not been given.

8. Trade Payables Due to related parties - -

9. Includes advance from related party Rs 14,37,722 [Previous Year: Rs 98,17,820]

10. The Company has been informed by its Bankers that an amount of Rs 35595 is lying to the credit of the account of the Company. This amount pertains to the year 1999. The Company has instructed the Bankers to deposit the amount into the Investor Education and Protection Fund. The Bankers are yet to do the needful in the matter.

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Mar 31, 2014

1 a. The company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity shares is entitiled to one vote per share. In the event of liquidation of the company, the holder of equity shares will be entitled to receive remaining assets of the company.

2. Points:

1 Car Loan:

a There are 2 term loans. One term loan from Axis Bank is secured against car.

The amount payable within one year is Rs 3.63 lakhs

2 Working Capital Facilities and Other Term Loans:

The working capital facilities and the term loans are secured against the following: a Equitable mortgage of land and building situated thereon at Gat 232 / 2, Survey No 28, Hissa 1A, measuring 3860 sq mtrs within village Dheku, Taluka Khalapur, District Raigad. b Equitable mortgage of land and building situated thereon at Gat 232 / 1, Survey No 28, Hissa 1A, measuring 3860 sq mtrs within village Dheku, Taluka Khalapur, District Raigad, owned by Sonal Ropes Limited. c Equitable mortgage of property at Ground Floor, C Wing, Bhagwati Building, FP Nos 18 - 19 / 34 A, B, C and 35 A, B, C, TPS VI and CTS No 1610 / 27 and 1610 / 28 of Santacruz West, Linking Road, Extension Road, Mumbai 400 054, owned by Sandeep Arora and Mridu Arora.

d Equitable mortgage of property (Residential Flat) at 11th Floor, Morya Heights, Plot No 15, 16 and 17, Near Sanjeevani International School, Kharghar Sector 18, Navi Mumbai, District Panvel, owned by Sonal Impex Limited

e Equitable mortgage of industrial property situated at Gut No 236 (1), House No 142, Village Dheku, Off Takai - Adoshi Road, Adashi, Khopoli, Raigad, owned by Sonal Impex Limited.

f Hypothecation of existing fixed assets

g Hypothecation of plant and machinery of Sonal Ropes Limited

h Cash collateral or immovable property worth Rs 0.50 crores.

i Third party guarantee of Sandeep Arora, Kamal Arora, Mridu Arora, Corporate Guarantees of Sonal Impex Limited and Sonal Ropes Limited.

j Amount repayable within one year for term loan is Rs 84 lakhs (Previous Year: Rs 84 lakhs).

3. Notes:

1 Section 205 of the Companies Act, 1956 mandates that companies transfer dividend that has been unclaimed for a period of 7 years from unclaimed dividend account to the Investor Education and Protection Fund (''IEPF''). Accordingly, if the dividend is unclaimed for a period of 7 years, it will be transferred to IEPF. The unclaimed dividend pertains to the financial years 2009 - 2010, 2010 - 2011 and 2011 - 2012.

2 Of the above, fixed deposits aggregating to Rs 77.88 lakhs (Previous Year: Rs 14.37 lakhs) have been kept as margin money against working capital facilities availed by the Company. These fixed deposits mature during the next 12 months.

4. Nature of business

1.1 The Company is in the business of manufacturing adhesive tapes and plastic ropes. The manufacturing facility of the Company is situated at Khopoli and its registered office is situated in Andheri (West), Mumbai. The Company exports its products through its associate companies. The Company also gets some part of the manufacturing done from its associate companies on job work basis.

5. Notes:

1. Figures in italics represent previous year''s amount.

2. Items of a similar nature may be disclosed in aggregate by type of related party except when separate disclosure is necessary for an understanding of the effects of related party transactions on the financial statements of the reporting enterprise. Disclosure of details of particular transactions with individual related parties would frequently be too voluminous to be easily understood. Accordingly, items of a similar nature may be disclosed in aggregate by type of related party. However, this is not done in such a way as to obscure the importance of significant transactions. Hence, purchases or sales of goods are not aggregated with purchases or sales of fixed assets. Nor a material related party transaction with an individual party is clubbed in an aggregated disclosure.

6. Other financial information

6.1 Auditor''s Remuneration

The above fees are exclusive of service tax.

The company takes credit for the service tax on the above payment.

6.2 Dues to Micro Small and Medium Enterprises

The Company has not received any intimation from its suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence, the disclosures, if any, relating to the amounts unpaid as at 31 Mar 2014 together with the interest paid / payable as required under the said Act have not been given.

6.3 No provision has been created on trade receivables aggregating to Rs 28,27,431 (Previous Year: Rs 70,17,053) which are older than six months. Also, the Management assumes that the other current assets and current liabilities will be realized and settled respectively atleast at the values disclosed in the balance sheet.

6.4 Cash Flow Statements

Cash-flow statements are prepared in accordance with the "Indirect Method" as explained in the Accounting Standard (AS) 3 - Cash Flow Statements as prescribed under section 211(3C) of the Companies Act 1956 read with General Circular 15 / 2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013.

6.5 Cash and Cash Equivalents

Cash and bank balances and current investments that have insignificant risk of change in value, which have durations up to three months, are included in the Company''s cash and cash equivalents in the Cash Flow Statement.

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Mar 31, 2013

1. Nature of business

1.1 The Company is in the business of manufacturing adhesive tapes and plastic ropes. The manufacturing facility of the Company is situated at Khopoli and its registered office is situated in Andheri (West), Mumbai. The Company exports its products through its associate companies. The Company also gets some part of the manufacturing done from its associate companies on job work basis.

1.2 Dues to Micro Small and Medium Enterprises

The Company has not received any intimation from its suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence, the disclosures, if any, relating to the amounts unpaid as at 31st Mar 2013 together with the interest paid / payable as required under the said Act have not been given.

1.3 The Company submitted audited financial statements to the concerned stock exchanges. Thereafter, an error was noticed in the financial statements due to a software problem. The accounts were subsequently revised and the Board of Directors re-approved the revised financial statements

1.4 No provision has been created on debtors aggregating to Rs 70,17,053 (Previous Year: Rs 1,18,91,411) which are older than six months. Also, the Management assumes that the other current assets and current liabilities will be realized and settled respectively at least at the values disclosed in the balance sheet.

1.5 Cash Flow Statements

Cash-flow statements are prepared in accordance with the "Indirect Method" as explained in the Accounting Standard (AS) 3 - Cash Flow Statements as prescribed under section 211(3C) of the Companies Act 1956.

1.6 Cash and Cash Equivalents

Cash and bank balances and current investments that have insignificant risk of change in value, which have durations up to three months, are included in the Company''s cash and cash equivalents in the Cash Flow Statement.

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Mar 31, 2012

Note 1 Share capital

1 Term loan is secured against car. The amount repayable within one year is Rs. 4.31 lakhs

2 Represents loan for Cash Credit, Export Packing Credit and Term Loan. The Cash Credit and Export Packing Credit facilities are secured by stock in trade and book debts and other present and future current assets.

The Term Loan is secured by the hypothecation of assets and machineries purchased out of bank finance.

The above loans are also secured by personal guarantee of directors and corporate guarantee of associate concerns

Sonal Impex Limited and Sonal Ropes Limited. The working capital amount is repayable on demand.

The term loan is repayable in 65 monthly installments. Amount payable in one year is Rs. 14 lakhs.

3 Represents 12 years of interest free sales tax deferment payment loan received from the Government of Maharashtra. Repayment has commenced in the financial year 2005 - 2006. The Company has not defaulted on any payment. Repayment is made on the basis of schedule obtained.

The amount repayable within one year is Rs. 2050899 (Previous year: Rs. 2120463).

Note 2

Note:

a) The addition to fixed assets have been classified in accordance with the classification normally adopted by the Management.

b} The additions to fixed assets are exclusive of VAT since the Company claims set off credit for the same (except which cannot be taken as set off.)

c) Motor cycle has been fully depreciated.

d) Of the machines purchased during the year, commercial production on one machine has not commenced. Hence, no depreciation has been claimed for that machine.

1. Nature of business

1.1 The Company is in the business of manufacturing adhesive tapes and plastic ropes. The manufacturing facility of the Company is situated at Khopoli and its registered office is situated in Andheri (West), Mumbai. The Company exports its products through its associate companies. The Company also gets some part of the manufacturing done from its associate companies on job work basis.

Notes:

1. Figures in italics represent previous year's amount.

2. Items of a similar nature may be disclosed in aggregate by type of related party except when separate disclosure is necessary for an understanding of the effects of related party transactions on the financial statements of the reporting enterprise. Disclosure of details of particular transactions with individual related parties would frequently be too voluminous to be easily understood. Accordingly, items of a similar nature may be disclosed in aggregate by type of related party. However, this is not done in such a way as to obscure the importance of significant transactions. Hence, purchases or sales of goods are not aggregated with purchases or sales of fixed assets. Nor a material related party transaction with an individual party is clubbed in an aggregated disclosure.

2. Other financial information

2.1 Dues to Micro Small and Medium Enterprises

The Company has not received any intimation from its suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence, the disclosures, if any, relating to the amounts unpaid as at 31 Mar 2012 together with the interest paid/payable as required under the said Act have not been given.

2.1 Balance of debtors, creditors and bank are subject to confirmations from the respective parties.

2.3 No provision has been created on debtors aggregating to Rs. 15964180 (Previous Year: Rs 1095322). Also, the Management assumes that the other current assets and current liabilities will be realized and settled respectively atleast at the values disclosed in the balance sheet.

Notes:

1. The installed capacity is as certified by the Management and not verified by the auditors, this being a technical matter.

2. Actual production includes production of goods captively consumed.

3. Production figures do not include quantity of product outsourced for production.

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Mar 31, 2011

1. Key Management Personnel include Mr Mohan Arora and Mr Sandeep Arora.

2. Relatives to Key Management Personnel include Mona Arora.

3. Remuneration paid to directors is disclosed in Point 3.2 in the Notes to Accounts.

4 Dues to Micro Small and Medium Enterprises

The Company has not received any intimation from its suppliers Regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence, the disclosures, if any, relating, to the : amounts unpaid as at 31 Mar 2011 together with the interest paid / payable as required under the said Act have not been given. I

5 Balance of debtors, creditors and bank are subject to confirmations from the respective parties.

6 No provision has been created on debtors aggregating to Rs 1095322 (Previous Year: Rs.1674274). Also, the Management assumes that the other current assets and current liabilities will be realized and j settled respectively at least at the values disclosed in the balance sheet.

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Mar 31, 2010

1. Nature of business

1.1 The Company is in the business of manufacturing adhesive tapes and plastic ropes. The manufacturing facility of the Company is situated at Khopoli and its administrative office is situated in Andheri (West), Mumbai. The Company exports its products through its associate companies. The Company also gets some part of the manufacturing done from its associate companies on job work basis.

2. Key Management Personnel include Mohan Arora (Managing Director) and Sandeep Arora.

3. Relatives to Key Management Personnel include Mona Arora.

4. Goods are sold on three (3) month credit to non-reiated parties. Four (4) months credit period is generally allowed on sales made to associates.

5. Loans taken from enterprises owned by key management personnel do not stipulate any repayment schedule

6. Goods sold to Sonal Impex Limited are not sold in India and hence there is no price comparison between goods sold to Sonal Impex Limited and goods sold to an unrelated party.

7. Remuneration paid to directors is disclosed in Point 3.2 in the Notes to Accounts.

8, Other financial information

8.1 No whole time company secretary

The Company does not have a whole time company secretary as prescribed by section 383A of the Companies Act, 1956. .

8.2 Micro Small and Medium Enterprises

The Company has not received any intimation from its suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence, the disclosures, if any, relating to the amounts unpaid as at 31 Mar 2010 together with the interest paid / payable as required under the said Act have not been given.

8.3 Balance of debtors, creditors and bank are subject to confirmations from the respective parties.

Notes:

1. The installed capacity is as certified by the Management and not verified by the auditors, this being a technical matter.

2. Actual production includes production of goods captively consumed.

3. Production figures do not include quantity of product outsourced for production.

Note:

The closing stock stated above is after adjustments for in-transit brokerage, obsolete and expired stocks and also for captive consumption.