CLC Industries Ltd. के अकाउंट के लिये नोट

Mar 31, 2025

XV) PROVISIONS AND CONTINGENT LIABILITIES

Provisions: Provisions are recognized when the entity has a present obligation (legal or
constructive) as a result of past event, it is probable that an outflow of resources embodying
economic benefits will be required to settle the obligation and a reliable estimate can be made of
the amount of the obligation. When the entity expects some or all of a provision to be reimbursed,
the reimbursement is recognised as a separate asset, but only when the reimbursement is virtually
certain. The expense 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 discounted using a current pre¬
tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used,
the increase in the provision due to the passage of time is recognised as a finance cost.

Contingent Liabilities: 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 or a reliable estimate of the amount
cannot be made.

XVI) CASH AND CASH EQUIVALENTS

Cash and cash equivalent in the Balance Sheet comprise cash at banks and on hand and short¬
term deposits with an original maturity of three months or less, which are subject to an
insignificant risk of changes in value.

XVII) FINANCIAL ASSETS AT AMORTISED COST

Financial assets are subsequently measured at amortised cost if these financial assets are held
within a business whose objective is to hold these assets in order to collect contractual cash
flows and contractual terms of the financial asset give rise on specified dates to cash flows
that are solely payments of principal and interest on the principal amount outstanding.

XVIII) FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIV E INCOME

Financial assets are measured at fair value through other comprehensive income if these
financial assets are held within a business whose objective is achieved by both collecting
contractual cash flows and selling financial assets and a contractual terms of the financial
assets give rise on the specified dates to cash flows that are solely payment of the principal
and interest on the principal amount outstanding.

XIX) FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS

Financial assets are measured at fair value through profit or loss unless it is measured at
amortised cost or at fair value through other comprehensive income on initial recognition. The
transaction costs directly attributable to the acquisition of assets and liabilities at fair value
thro ugh profit and loss are immediately recognised in the statement of profit and loss.

XX) FINANCIAL LIABILITIES

Financial liabilities are measured at amortised cost using the effective interest method, if
tenure of repayment of such liability exceeds one year.

XXI) RECLASSIFICATION OF FINANCIAL ASSETS

The Company determines classification of the financial assets and liabilities on initial
recognitions. After initial recognition, no reclassification is made for financial assets which are
equity instruments and financial liabilities. For financial assets which are debt instruments, a
reclassification is made only if there is a change in the business model for managing those
assets. Changes to the business model are expected to be infrequent. The Company''s senior
management determines change in the business model as a result of external or internal
changes which are significant to the company''s operations. Such changes are evident to
external parties. A change in the business model occurs when a company either begins or
ceases to perform an activity that is significant to its operations. If the Company reclassifies
financial assets, it applies the reclassification prospectively from the reclassification date
which is the first day of the immediately next reporting period following the change in business
model. The Company does not restate any previously recognized gains, losses (including
impairment gains and losses) or interest.

XXII) OFFSETTING OF FINANCIAL INSTRUMENTS

Financial assets and liabilities are offset and the net amount is reported in the Balance Sheet
if there is currently enforceable legal right to offset the recognized amounts and there is on
intention to settle on a net basis, to realize the assets and settle the liabilities simultaneously.

XXIII) LEASES:

The determination of whether an arrangement is (or contains) a lease is based on the
substance of the arrangement at the inception of the lease. The arrangement is, or contains,
a lease if fulfilment of the arrangement is dependent on the use of a specific asset or assets
and the arrangement conveys a right to use the asset or assets, even if that right is not
explicitly specified in an arrangement.

Entity as a lessee

A lease is classified at the inception date as a finance lease or an operating lease. A lease that
transfers substantially all the risks and rewards incidental to ownership to the entity is
classified as a finance lease.

Finance leases are capitalised at the commencement of the lease at the inception date fair
value of the leased property or, if lower, at the present value of the minimum lease payments.
Lease payments are apportioned between finance charges and reduction of the lease liability
so as to achieve a constant rate of interest on the remaining balance of the liability. Finance
charges are recognised in finance costs in the Statement of Profit and Loss, unless they are
directly attributable to qualifying assets, in which case they are capitalized in accordance with
the entity''s general policy on the borrowing costs. Contingent rentals are recognised as
expenses in the periods in which they are incurred.

Leased assets are depreciated over the useful life of the asset. However, if there is no
reasonable certainty that the entity will obtain ownership by the end of the lease term, the
asset is depreciated over the shorter of the estimated useful life of the asset and the lease
term.

34 Fair Value Measurement

The management assessed that the fair values of short-term financial assets and liabilities
significantly approximate their carrying amounts largely due to the short-term maturities of
these instruments. The fair value of financial assets and liabilities are included at the amount at
which the instrument could be exchanged in a current transaction among willing parties, other
than in a forced or liquidation sale

The Company determines fair values of long-term financial assets and financial liabilities by
discounting contractual cash inflows/ outflows using prevailing interest rates of financial
instruments with similar terms. The fair value of investment is determined using quoted net
assets value from the fund. Further, the subsequent measurement of all finance assets and
liabilities (other than investment in mutual funds) is at amortized cost, using the effective
interest method.

Discount rates used in determining fair value

The interest rate used to discount estimate future cash flows, wherever applicable, are based
on the incremental borrowing rate of the borrower which in case of financial liabilities is the
weighted average cost of borrowing of the Company and in case of financial assets is the
average market rate of similar credits rated instrument.

The Company maintains policies and procedures to value financial assets or financial liabilities
using the best and most relevant data available. In addition, the Company internally reviews
valu ation, including independent price validation for certain instruments.

Fair value hierarchy

All financial instruments for which fair value is recognized or disclosed are categorized within
the fair value hierarchy described as follows, based on the lowest level input that is significant
to the fair value measurement as a whole.

Level -1

Quoted (unadjusted) price is active market for identical assets or liabilities
Level 2:

Valuation technique for which the lowest level input that has a significant effect on the fair value
measurement are observed, either directly or indirectly.

Level 3

Valuation technique for which the lowest level input has a significant effect on the fair value
measurement is not based on observation market data.

35 Financial Instruments and Risk Review

i) Capital Management

The Company''s capital management objectives are: -

The Board policy is to maintain a strong capital base so as to maintain inventory, creditors and
market confidence and to future development of the business. The Board of Directors monitors
retu rn on capital employed.

The Company manages capital risk by maintaining sound/optimal capital structure through
monitoring of financial ratios, such as debt-to-equity ratio and net borrowings-to-equity ratio
on a monthly basis and implements capital structure improvement plan when necessary.

The Company uses debt equity ratio as a capital management index and calculates the ratio as
Net debt divided by total equity. Net debt and total equity are based on the amounts stated in
the financial statements.

ii) Credit Risk

Credit risk is the risk of financial loss arising from counter-party failure to repay or service debt according
to contractual terms or obligations. Credit risk encompasses both, the direct risk of default and the risk
of deterioration of credit worthiness as well as concentration of risks. Credit risk is controlled by
analysing credit limit and credit worthiness of customers on a continuous basis to whom the credit has
been granted.

Financial instruments that are subject to concentration of credit risk principally consists of trade
receivable investments, derivative financial instruments and other financial assets. None of the financial
instru ments of the Company results in material concentration of credit risk.

Exposure to credit risk

The carrying amount of financial assets represents the maximum credit exposure. The maximum
exposure to credit risk is as under, being the total of the carrying amount of balances with trade
receivables

Trade receivables

Ind AS requires expected credit losses to be measured through a loss allowance. The Company assesses
at each date of financial statement whether a financial asset or group of financial assets is impaired.
The Company recognizes lifetime expected losses for all contract assets and / or all trade receivables
that do not constitute a financing transaction. For all other financial assets, expected credit losses are
measured at an amount equal to 12 months expected credit losses or at an amount equal to the life
time expected credit losses, if the credit risk on the financial asset has increased significantly since initial
recognition.

Before accenting any new customer, the Company uses an external/internal credit scoring system to
asses potential customer''s credit quality and defines credit limits by customer. Limits and scoring
attributed to customer are reviewed on periodic basis.

iii) Liquidity Risk

a) Liquidity risk management

Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The objective of
liquidity risk management is to maintain sufficient liquidity and ensure that funds are available for use
as per requirements. The Company manages liquidity risk by maintaining adequate reserves, banking
facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows,
and by matching the maturity profiles of financial assets and liabilities.

b) Maturities of financial liabilities

The following table details the remaining contractual maturities for its financial liabilities with agreed
repayment period. The amount disclosed in the table has been drawn up based on the undiscounted cash flow
of financial liabilities based on the earliest date on which the Company can be required to pay. The table
includes both interest and principal cash flows.

Before accenting any new customer, the Company uses an external/internal credit scoring system to asses
potential customer''s credit quality and defines credit limits by customer. Limits and scoring attributed to
customer are reviewed on periodic basis.

iii) Liquidity Risk

a) Liquidity risk management

Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The objective of liquidity
risk management is to maintain sufficient liquidity and ensure that funds are available for use as per
requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and
reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the
maturity profiles of financial assets and liabilities.

b) Maturities of financial liabilities

The following table details the remaining contractual maturities for its financial liabilities with agreed
repayment period. The amount disclosed in the table has been drawn up based on the undiscounted cash flow
of financial liabilities based on the earliest date on which the Company can be required to pay. The table
includes both interest and principal cash flows.

56 The Company does not have any investment property, hence related disclosure is not required.

57 The company has not advanced or loaned or invested funds (either borrowed funds or share premium or any other sources or kind of funds) to any other
person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding (whether recorded in writing or otherwise) 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.

58 There is no case of search or survey of any other cases related to income surrendered or disclosed in any tax assessments under the Income Tax Act, 1961.

59 The company has not invested in Crypto Currency or Virtual Currency, hence related details are not provided.

60 Statement of Ratios :- This being the first year of commercial operation, comparable finacial ratio and its deviation have not been provided.

61 The company has not met with the applicability criteria of provisions of section 135 of the Act with respect to corporate social responsibility, hence the related
information has not been provided.

⁶² The Company has not entered into any scheme of arrangement or compromise which has an accounting impact on current or previous financial year.

⁶³ All the amounts disclosed in the financial statements and notes have been rounded off to nearest Lakhs as per the requirements of Schedule III of the
Companies Act, 2013, unless otherwise stated.

⁶⁴ There are no loans or advances in the nature of loans which are granted to promoters, directors, KMPs and the related parties (as defined under the
Companies Act, 2013) either severally or jointly with any other person which are either repayable on demand or without specifying any terms and period of
repayment.

⁶⁵ Previous year''s figures have been re-grouped/ re-arranged/re-classified/re-casted wherever necessary to make them comparable.

^Sd/- Sd/- Sd/- ^Sd/-

Sanchit Singh Rajpal Bhupendra Singh Rajpal Shrutisheel Jhanwar Koyal Gehani

Managing Director

Chairman Whole time director and CFO

Company Secretary

DIN: 00311190 DIN: 00311202 DIN: 03582803 M. No. 45277

Place: Chhatrapati Sambhajinagar
Date: 30-05-2025

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Mar 31, 2024

XV) PROVISIONS AND CONTINGENT LIABILITIES

Provisions: Provisions are recognized when the entity has a present obligation (legal or constructive) as a result of past
event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a
reliable estimate can be made of the amount of the obligation. When the entity expects some or all of a provision to be
reimbursed, the reimbursement is recognised as a separate asset, but only when the reimbursement is virtually certain. The
expense 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 discounted using a current pre-tax rate that reflects, when
appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of
time is recognised as a finance cost.

Contingent Liabilities: 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 or a reliable estimate of the amount cannot be made.

XVI) CASH AND CASH EQUIVALENTS

Cash and cash equivalent in the Balance Sheet comprise cash at banks and on hand and short-term deposits with an
original maturity of three months or less, which are subject to an insignificant risk of changes in value.

XVII) FINANCIAL ASSETS AT AMORTISED COST

Financial assets are subsequently measured at amortised cost if these financial assets are held within a business whose
objective is to hold these assets in order to collect contractual cash flows and contractual terms of the financial asset give
rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

XVIII) FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

Financial assets are measured at fair value through other comprehensive income if these financial assets are held within a
business whose objective is achieved by both collecting contractual cash flows and selling financial assets and a
contractual terms of the financial assets give rise on the specified dates to cash flows that are solely payment of the
principal and interest on the principal amount outstanding.

XIX) FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS

Financial assets are measured at fair value through profit or loss unless it is measured at amortised cost or at fair value
through other comprehensive income on initial recognition. The transaction costs directly attributable to the acquisition of
assets and liabilities at fair value through profit and loss are immediately recognised in the statement of profit and loss.

XX) FINANCIAL LIABILITIES

Financial liabilities are measured at amortised cost using the effective interest method, if tenure of repayment of such liability
exceeds one year.

XXI) RECLASSIFICATION OF FINANCIAL ASSETS

The Company determines classification of the financial assets and liabilities on initial recognitions. After initial recognition,
no reclassification is made for financial assets which are equity instruments and financial liabilities. For financial assets
which are debt instruments, a reclassification is made only if there is a change in the business model for managing those
assets. Changes to the business model are expected to be infrequent. The Company''s senior management determines
change in the business model as a result of external or internal changes which are significant to the company''s operations.
Such changes are evident to external parties. A change in the business model occurs when a company either begins or
ceases to perform an activity that is significant to its operations. If the Company reclassifies financial assets, it applies the
reclassification prospectively from the reclassification date which is the first day of the immediately next reporting period
following the change in business model. The Company does not restate any previously recognized gains, losses (including
impairment gains and losses) or interest.

XXII) OFFSETTING OF FINANCIAL INSTRUMENTS

Financial assets and liabilities are offset and the net amount is reported in the Balance Sheet if there is currently
enforceable legal right to offset the recognized amounts and there is on intention to settle on a net basis, to realize the
assets and settle the liabilities simultaneously.

XXIII) LEASES :

The determination of whether an arrangement is (or contains) a lease is based on the substance of the arrangement at the
inception of the lease. The arrangement is, or contains, a lease if fulfilment of the arrangement is dependent on the use of a
specific asset or assets and the arrangement conveys a right to use the asset or assets, even if that right is not explicitly
Entity/'' as a les aee

A lease is classified at the inception date as a finance lease or an operating lease. A lease that transfers substantially all the
risks and rewards incidental to ownership to the entity is classified as a finance lease.

Finance leases are capitalised at the commencement of the lease at the inception date fair value of the leased property or,
if lower, at the present value of the minimum lease payments. Lease payments are apportioned between finance charges
and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability.
Finance charges are recognised in finance costs in the Statement of Profit and Loss, unless they are directly attributable to
qualifying assets, in which case they are capitalized in accordance with the entity''s general policy on the borrowing costs
(See note 1.12). Contingent rentals are recognised as expenses in the periods in which they are incurred.

Leased assets are depreciated over the useful life of the asset. However, if there is no reasonable certainty that the entity
will obtain ownership by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life of
the asset and the lease term.

Operating lease rentals are charged off to the Statement of Profit and Loss.

15.1 As per the resolution plan approved, all the secured / unsecured financial / operational liabilities existed on
the date of start of CIRP process i.e. 03.01.2020 has extinguished except payment made to certain creditors as
provided in resolution plan. Resultanly, all the extinguished liabilities have been transferred to Capital Reserve
Account.

15.2 The share capital as held by to erstwhile promoters and 99% of equity shares held by Public has been
extinguished and the same is credited to Capital Reduction Reserve Account. Refer Capital clause of Statement of
Changes in Equity for financial year ended on 31st March, 2024.

15.3 As per the resolution plan, the company has provided for Contingency Reserve for Labour and Other
Liabilities and the same is funded by way of fixed deposit with bank. This reserve will solely used for its purpose
and balance, if any, will be transferred to secured financial creditors.

15.4 During the year, the company has implemented the resolution plan as approved by the National Company
Law Board, New Delhi. As per resolution plan certain liabilities of secured and unsecured financial and operational
creditors have been extinguished and the same are transferred to capital reserve account. The details on
extinguished liabilities are as under:-

26 Fair Value Measurement

The management assessed that the fair values of short term financial assets and liabilities significantly approximate their
carrying amounts largely due to the short term maturities of these instruments. The fair value of financial assets and
liabilities are included at the amount at which the instrument could be exchanged in a current transaction among willing
parties, other than in a forced or liquidation sale

The Company determines fair values of long term financial assets and financial liabilities by discounting contractual cash
inflows/ outflows using prevailing interest rates of financial instruments with similar terms. The fair value of investment is
determined using quoted net assets value from the fund. Further, the subsequent measurement of all finance assets and
liabilities (other than investment in mutual funds) is at amortized cost, using the effective interest method.

Discount rates used in determining fair value

The interest rate used to discount estimated future cash flows, where applicable, are based on the incremental borrowing
rate of the borrower which in case of financial liabilities is the weighted average cost of borrowing of the Company and in
case of financial assets is the average market rate of similar credits rated instrument.

The Company maintains policies and procedures to value financial assets or financial liabilities using the best and most
relevant data available. In addition, the Company internally reviews valuation, including independent price validation for
certain instruments.

Fair value hierarchy

All financial instruments for which fair value is recognized or disclosed are categorized within the fair value hierarchy
Level -1

Quoted (unadjusted) price is active market for identical assets or liabilities
Level 2:

Valuation technique for which the lowest level input that has a significant effect on the fair value measurement are
observed, either directly or indirectly.

Level 3

Valuation technique for which the lowest level input has a significant effect on the fair value measurement is not based on
observation market data.

27 Financial Instruments and Risk Review

i) Capital Management

The Company''s capital management objectives are:-

The Board policy is to maintain a strong capital base so as to maintain inventory, creditors and market confidence and to
future development of the business. The Board of Directors monitors return on capital employed.

The Company manages capital risk by maintaining sound/optimal capital structure through monitoring of financial ratios,
such as debt-to-equity ratio and net borrowings-to-equity ratio on a monthly basis and implements capital structure
improvement plan when necessary.

The Company uses debt equity ratio as a capital management index and calculates the ratio as Net debt divided by total
equity. Net debt and total equity are based on the amounts stated in the financial statements.

* Net Debts includes Non-Current borrowings, Current borrowings, Current Maturities of non current borrowing net off
Current Investment and cash and cash equivalent

** Equity includes equity and others equity.

ii) Credit Risk

Credit risk is the risk of financial loss arising from counter-party failure to repay or service debt according to contractual
terms or obligations. Credit risk encompasses both, the direct risk of default and the risk of deterioration of credit
worthiness as well as concentration of risks. Credit risk is controlled by analysing credit limit and credit worthiness of
customers on a continuous basis to whom the credit has been granted.

Financial instruments that are subject to concentration of credit risk principally consists of trade receivable investments,
derivative financial instruments and other financial assets. None of the financial instruments of the Company results in
material concentration of credit risk.

Trade receivables

Ind AS requires expected credit losses to be measured through a loss allowance. The Company assesses at each date of
financial statement whether a financial asset or group of financial assets is impaired. The Company recognizes lifetime
expected losses for all contract assets and / or all trade receivables that do not constitute a financing transaction. For all
other financial assets, expected credit losses are measured at an amount equal to 12 months expected credit losses or at
an amount equal to the life time expected credit losses, if the credit risk on the financial asset has increased significantly
since initial recognition

Before accenting any new customer, the Company uses an external/internal credit scoring system to asses potential
customer''s credit quality and defines credit limits by customer. Limits and scoring attributed to customer are reviewed on
periodic basis.

iii) Liquidity Risk

a) Liquidity risk management

Liquidity risk refers to the risk that the Company can not meet its financial obligations. The objective of liquidity risk
management is to maintain sufficient liquidity and ensure that funds are available for use as per requirements. The
Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by
continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and
liabilities.

b) Maturities of financial liabilities

The following table details the remaining contractual maturities for its financial liabilities with agreed repayment period.
The amount disclosed in the table has been drawn up based on the undiscounted cash flow of financial liabilities based on
the earliest date on which the Company can be required to pay. The table includes both interest and principal cash flows.

c) Maturities of financial assets

The expected maturity for financial assets of the Company are all current

iv) Market Risk

Market risk is risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in the
market prices. Such changes in the value of financial instruments may result from changes in the foreign currency
exchange rate, interest rate, credit, liquidity and other market changes.

28 Contingent liabilities not provided for in respect of followings:_

(a) non observance, if any, with various fiscal statutes, laws and regulations in respect of fee, penalty, etc which cannot be reliably estimated at this stage.

(b) The TDS demands raised by the income tax department for the financial year 2008-09 to 2023-24 amounting to ?62.21 Lakhs for Delhi and ?0.04 Lakhs for
Baramati branch which are under reconciliation.

(c) The Income tax demands raised by the income tax department for various financial years amounting to ?4,052.18 Lakhs for which the company has submit waiver
application to Assessing Officer, Income Tax, in view of NCLT order.

29 Estimated amount of contracts remaining to be executed on capital account and not provided for ?14.17 Lakhs (net of advance of ? 9.82 Lakhs)

30 The accounts of the Company for the year ended 31 st March, 2024 have been prepared on a going concern basis.

31 In the opinion of the Board, Current and Non-current Assets, Loans and Advances are approximately of the value stated, if realized in the ordinary course of the
business.

32 Certain accounts of Trade Receivable, Trade Payable, Secured and Unsecured Loans, Employees, Loans and Advances, Deposits are subject to confirmations and
reconciliations, if any. The difference as may be noticed on reconciliation will be duly accounted for on completion thereof. In the opinion of the management, the
ultimate difference will not be material.

43 No proceeding has been initiated or pending against the company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988)

_and the rules made thereunder._

44 The company has used the borrowings from banks and financial institutions for the purpose for which it was taken at the balance sheet date. The Company is not

required to file monthly returns or statements of current assets with banks or financial institutions, as no working capital loans or cash credit facilities have been

availed.

45 The company is not declared wilful defaulter by any bank or financial Institution or other lender during the year.

46 During the year, the company has not carried out any transactions with companies struck off under section 248 of the Companies Act, 2013 or section 560 of

Companies Act, 1956.

47 During the year, the company has duly registered charge with Registrar of Companies. Certain charges have been satisfied, however, pending for registration with
Registrar of Companies.

48 The Company does not have any investment property, hence related disclosure is not required.

49 The company has not advanced or loaned or invested funds (either borrowed funds or share premium or any other sources or kind of funds) to any other person(s) or
entity(ies), including foreign entities (Intermediaries) with the understanding (whether recorded in writing or otherwise) 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.

50 There is no case of search or survey of any other cases related to income surrendered or disclosed in any tax assessments under the Income Tax Act, 1961.

51 The company has not invested in Crypto Currency or Virtual Currency, hence related details are not provided.

52 Various Ratios :- During the financial year, the effects of the Order Issued by Hon''ble National Company Law Board, New Delhi ("NCLT Order'') has been given in the
books of account and also the manufacturing and trading operations are yet to be started since Baramati plant is under renovation. As a results the various ratio as
prescribed have not been provided.

53 The company has not met with the applicability criteria of provisions of section 135 of the Act with respect to corporate social responsibility, hence the related
information has not been provided.

54 Previous year''s figures have been re-groupped/ re-arranged wherever necessary._

Sd/- Sd/- Sd/- Sd/-

Sanchit Singh Rajpal Bhupendra Singh Rajpal Shrutisheel Jhanwar Koyal Gehani

Managing Director Chairman Chief Financial Officer Company Secretary

DIN: 00311190 DIN: 00311202 PAN: ADPPJ9106N PAN: AYQPG5876L

Place: Chhatrapati Sambhajinagar
Date: 30th May 2024

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Mar 31, 2023

SUB NOTE: - 14(a) The company has only one class of equity share having a par value of Rs. 10/- per share. Each Shareholder is eligible for one vote per share. The dividend proposed, if any, by the Board of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting, except in case of interim dividend. 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 of their shareholding.

SUB NOTE: - 14 (b) Reconciliation of number of shares outstanding at the beginning and at the end of the year

*The Company has not allotted shares against this amount which was brought in by the promoters in more than one instalment under restructuring scheme approved by the Bankers. Due to pending necessary approvals and directions for allotment of shares, the Company has not complied with the provisions of Section 42 of the Companies Act, 2013.

Nature of Security

Working Capital Loans from Banks are secured by first pari-passu charge on entire current assets, long term loan and advances and other non current assets of the Company. These loans are further secured by second pari-passu charge on entire fixed assets, both present and future and personal guarantee of the promoters. These loans, are also secured by pledge of promoters'' shares (29,683,420 nos.) on pari-passu basis.

* The short term borrowing from banks have generally remained overdue during the substantial part of the financial year. The overdue amount as at March 31,2023 was Rs. 27,501.33 (P. Y Rs. 27,501.33 ).

NOTE: - 35 Contingent liabilities not provided for in respect of:

	Particulars	For the Year ended March 31, 2023	For the Year ended March 31, 2022
	Contingent Liabilities Not Provided For:
(a)	Demands from income tax authorities under appeal	37,981,404	37,981,404
(b)	Demands from sales tax authorities under appeal	100,659,595	100,659,595
(c)	Demands from EPF Appellate authority	1,565,076	1,565,076
(d)	Show cause notices/demands raised by excise / customs department (including applicable penalties), not acknowledged as debts"	287,427,998	287,427,998
(e)	Show cause notices/demands raised by MP Government / MPEB department,not acknowledged as debts"	125,056,000	125,056,000
(f)	Claims against the company not acknowledged as debts	293,300,000	293,300,000
(g)	Guarantees and letters of credit issued on behalf of the company, outstanding at the year end	640,290	640,290
(h)	Bills Discounted with banks on behalf of the company, outstanding at the year end.	-	-
(i)	Corporate Guarantee given to IREDA for loan to M/s Himalayan Crest Power Private Limited	119,920,545	119,920,545
(j)	Corporate Guarantee given to AXIS Bank Ltd.& UCO Bank for loan to M/s Amit Spinning Industries Limited"*	-	-
(k)	Corporate Guarantee given to CVCI for investment in Spentex (Netherlands) B.V.Current Year USD 2,000,000 (previous year USD 2,000,000)1	-	-
(l)	Corporate Guarantee given to SBI - Tokyo Branch for loan to Spentex (Netherlands) B.V Current Year USD 22,009,732 (previous year USD 21,427,318)2
	Total	966,550,908	966,550,908
No information updated for the year ended March 31, 2023

*Under the Guarantee AXIS Bank Ltd.& UCO Bank for loan to M/s Amit Spinning Industries Limited, The company, believes that no contingent liability is required in terms of the submission of resolution plan by the Court appointed IRP (Interim Resolution Professional) exonerating the guarantors from the said purview and on that basis the petition no.IB-131(PB)/2017 disposed by Honourable NCLT, Principal Bench vide their order dated 01.08.2017.

had been fulfilled in the first year itself i.e in 2006-07, therefore over the period for many year, neither Guarantee was renewed nor its renewal at any time was demanded by the CVCI, as the Guarantee of late, has become Infructuous, since its purpose has been fulfilled.

***The company believes that the corporate guarantee issued to SBI Tokyo is ''Open Ended'' as it does not specify period of its issuing of any such ''open ended'' Guarantee. Hence the Guarantee being deficient, is invalid corporate guarantee and therefore, no longer enforceable, as per RBI norm. Further, ODI Form Part II specifying the amount, date of issuance of corporate guarantee, has been allowed under the Automatic Route, was not filed by the Authorised dealer bank (SBI) with the RBI. Accordingly, all the requisite terms and conditions of issuing a guarantee by the Company under the automatic route were not fulfilled by the Authorised Dealer. Hence the corporate guarantee vis-a-vis SBI Tokyo is invalid as on date.

The amount shown in the items (a) to (f) represent the best possible estimates arrived at on the basis of available information. The uncertainties and possible reimbursements are dependent on outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be predicted accurately. The Company engages reputed professional advisors to protect its interest and has been advised that it has strong legal positions against such disputes. The amount shown in items (g) to (j) represent guarantees given and bills discounted in the normal course of the Company''s operations and are not expected to result in any loss to the Company on the basis of beneficiaries fulfilling their ordinary commercial obligations.

Above disclosure are based on financial year ended March 31, 2019 and no further updation being done due to lack of information

Note: - 36 In the opinion of the Management and to the best of their knowledge and belief, the value on realisation of current/ non current assets, loans and advances in the ordinary course of business would not be less than the amount at which they are stated in the financial statements.

(a) Defined Contribution Plans:

The Company has defined contribution plans for post retirement employment benefits namely Provident Fund and Employee State Insurance Scheme. Expenses for the same is being charged to statement of profit and loss for the year if any.

(b) Defined Benefit Plans:

The liability for gratuity is not provided at the year ended March, 31 2023 due to company is under Insolvency process and also no actuarial valuations done during the year ended March 31,2022.

(ii) Other Employee Benefits

Other employee benefits are accounted for on accrual basis.

The estimates of future salary increases, considered in actuarial valuations take account of inflation, seniority, promotion and other relevant factors such as supply and demand factors in the employment market.

H. Basis used to determine the Expected Rate of Return on Plan Assets

The expected rate of return on plan assets is based on the current portfolio of assets, investment strategy and market scenario. In order to protect the capital and optimize returns within acceptable risk parameters, the plan assets are well diversified.

Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the Chief Operating Decision Maker, in deciding how to allocate resources and assessing performance. Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. Based on the management approach as defined in Ind AS 108, the Chief Operating Decision Maker evaluates the group''s performance based on only one segment i.e. manufacturing and trading in Domesic & Outside India.

No information available for the current year

Note :- 43 Exposure in Foreign currency (on accrual basis):

The entity uses foreign currency denominated borrowings and foreign exchange forward contracts to manage some of its transaction exposures. However such foreign currency denominated borrowings have not been designated as hedge. Such derivatives are recorded at mark to market at each reporting date with a corresponding recognition in the Statement of Profit and Loss.

Note : - 44 Financial Instruments A - Fair values

The carrying amount of financial assets and liabilities except for certain financial assets i.e. “instrument carried at fair value” appearing in the financial statement are reasonable approximation of fair value. Such investments of those financial instruments carried at fair value are disclosed below:-

In the FY 2017-18'' Expenses of exceptional nature comprise ''the company has made a provision for value of long term investments amounting to Rs.2,044.70 lakhs in Amit Spinning Industries Limited(ASIL), Subsidiary of the Company and written off recoverable amounting of Rs. 7557.94 lakhs due from above subsidiary. During the FY 2017-18 the ASIL moved to National Company Law Tribunal (NCLT) for resolution of its liabilities. Further, NCLT vide order dated 01.08.2017 has admitted the ASIL''s petition and had appointed Resolution Professional for ASIL keeping in view of ongoing proceedings of ASIL in National Company Law Tribunal under Insolvency and Bankruptcy code. The NCLT vide its order dated 31st July 2018, had approved the resolution plan as submitted by Resolution Applicants for ASIL, the company was required to transfer its entire shareholding held in ASIL at a total consideration of Rs. One only in favour of Resolution Applicants as stipulated in Sanctioned Resolution plan. The Company was holding 2,09,81,077 equity shares (50.96%) in ASIL and company is in process to comply with the Resolution plan, During the year no further information available . Further we are unable to determine the amount of liability that may arise on account of Corporate Guarantee given on behalf of subsidiary, and compliance of IND-AS 109 in respect to accounting of corporate guarantee. Further provision made for inventory carrying cost of Rs. 2601.28 lakhs for which reconciliation with the parties are pending.

A corporate insolvency resolution process (“CIRP”) has been initiated in case of the Company vide an order of the Principal Bench of the National Company Law Tribunal (“NCLT”) dated January 03, 2020 under the provisions of the Insolvency and Bankruptcy Code, 2016 (“Insolvency Code”).

Since Corporate Insolvency Resolution Process (CIRP) is currently in progress, as per the Code, it is required that the Company be managed as going concern during CIRP Accordingly, the standalone financial statements are continued to be prepared on going concern basis. The Company continues the process for ascertaining the realisable value for its assets (including inventories and trade receivables) and necessary adjustments to the carrying value will be effected in due course, the impact of which is not ascertainable.

Note :- 48

Pursuant to commencement of CIRP of the Company under Insolvency and Bankruptcy Code, 2016, there are various claims submitted by the financial creditors, operational creditors, employees and other creditors to the RP The overall obligations and liabilities including interest on loans, Penel Interest etc and the principal amount of loans shall be determined during the CIRP and reoconciliation are pending. Pending final outcome of the CIRP, no accounting impact in the books of accounts has been made in respect of excess, short, or non-receipts of claims for operational and financial creditors.

Note :- 49

The Company''s accounts had become Non performing assets (NPA) with majority of the banks and due to this reason, the majority of lenders stopped charging interest from the company on their outstanding debts amount from the dates on which their accounts become NPA. The company is in advance stage of discussion with the lenders to settle their dues through Assets Reconstruction Companies by the lenders or otherwise. In view of the above, the company has not charged to statement of profit and loss account interest expenses of Rs. 5,211.00 Lakhs (approx.) and related penal interest and other charges for the year, if any, in respect of delay in repayment of borrowings from the banks. Further, Liability for interest expenses of Rs. 41,511.00 Lakhs (approx.) till March 31, 2023 has not been accounted for.

Note :- 50

The Company is required to deposit/invest a sum of at least 15% of the amount of its debentures maturing during the financial year 2018-19 in one or more of the prescribed methods vide circular no.04/2013 dated February 11,2013 issued by Ministry of Corporate Affairs .However, the Company has not complied with the requirement of the said circular.

Note :- 51

Due to working capital crunch, Baramati plant was shut down since September ''2017, other plants were shut down from October 2019. Management of the company is confident of restarting the unit as per note 47.

Note :- 52

The outstanding balance as on 31st March, 2023 in respect of trade receivables, trade payables and loans & advances, claims, Security Deposits, Balances with Govt Authorities, Banks, Financial Instituations, related parties, ICD, etc. are subject to confirmation/reconciliation and consequential adjustment if any, from the respective parties. The management, however, does not expect any material variations.

(c) General Description of Leasing Agreements:

(i) Lease Assets: Godowns, Offices, Residential Flats, Showroom and Others.

(ii) Future Lease Rentals are determined on the basis of agreed terms.

(iii) At the expiry of lease terms, the Company has an option to return the assets or extend the term by giving notice in writing.

Note 55 For the year ended March 31, 2023, the Company is in the process of check applicability of the transfer pricing.

Note :- 56 Financial risk management objectives and policies

The entity''s principal financial liabilities comprise loans and borrowings, security deposits and trade and other payables. The main purpose of these financial liabilities is to finance the entity''s operations and to provide guarantees to support its operations. The

entity''s principal financial assets include loans, investment in preference shares & equity shares, trade and other receivables, and cash and cash equivalents that are derived directly from its operations.

The entity''s business activities are exposed to a variety of financial risks, namely market risks, credit risk, Comodity Risk and liquidity risk. The entity''s senior management has the overall responsibility for establishing and governing the entity''s risk management framework. The entity has constituted a Risk Management Committee, which is responsible for developing and monitoring the entity''s risk management policies. The entity''s risk management policies are established to identify and analyse the risks faced by the entity, to set and monitor appropriate risk limits and controls, periodically review the changes in market conditions and reflect the changes in the policy accordingly. The key risks and mitigating actions are also placed before the Audit Committee of the entity.

(a) Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises of interest rate risk and currency risk and equity price risk. Financial instruments affected by market risk include loans and borrowings.

The sensitivity analysis in the following sections relate to the position as at March 31, 2023 and March 31, 2022.

The sensitivity analyses have been prepared on the basis that the amount of net debt, the ratio of fixed to floating interest rates of the debt and the proportion of financial instruments in foreign currencies are all constant as at March 31, 2023.

The analyses exclude the impact of movements in market variables on the carrying values of gratuity and other postretirement obligations and provisions.

The following assumptions have been made in calculating the sensitivity analysis:

The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is based on the financial assets and financial liabilities held at March 31,2023 and March 31,2022.

(i) Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The group''s exposure to the risk of changes in market interest rates relates primarily to the group''s long-term debt obligations with floating interest rates.

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The entity''s exposure to the risk of changes in market interest rates relates primarily to the entity''s long-term debt obligations with floating interest rates.

Interest rate sensitivity:

The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that portion of loans and borrowings affected. With all other variables held constant, the group''s profit before tax is affected through the impact on floating rate borrowings, as follows

The Company does not have any floting rate of interest on financial assets and liabilities . Therefore, a change in interest rates at the reporting date would not affect profit or loss and neither would it affect the equity.

(ii) Foreign currency risk

The Indian National Rupee is the entity''s most significant currency. As a consequence, the entity''s results are presented in Indian National Rupee and exposures are managed against Indian National Rupee accordingly. The entity has limited

foreign currency exposure which are mainly on account ECB loan, import and exports. import and export have short recovery cycle and counter each other reducing the foreign currency risk.

Foreign currency sensitivity:

The following tables demonstrate the sensitivity to a reasonably possible change in foreign currency exchange rates, with all other variables held constant. The impact on the entity''s profit before tax due to changes in the fair value of foreign currency exposure.

(iii) Commodity price risk

The entity is affected by the price volatility of certain commodities. Its operating activities require the ongoing purchase and manufacture of cotton/Polyster Yarn require a continuous supply of Cotton/PSF. Due to the significantly increased volatility of the price of the Cotton/PSF, the Entity also entered into various purchase contracts for Cotton/PSF/VSF (for which there is an active market).

The Entity''s Board of Directors has developed and enacted a risk management strategy regarding commodity price risk and its mitigation.

Based on a 12-month forecast of the required Cotton/PSF/VSF supply, the Entity hedges the purchase price using forward commodity purchase contracts. The forecast is deemed to be highly probable.

Commodity price sensitivity

The following table shows the effect of price changes in Commodity net of hedge accounting impact.

(iv) Equity price risk

The entity''s equity securities are susceptible to market price risk arising from uncertainties about future values of the investment securities. Reports on the equity portfolio are submitted to the Entity''s senior management on a regular basis. The entity''s Board of Directors reviews and approves all equity investment decisions.

At the reporting date, the exposure to quoted equity securities at fair value was Rs. 19,786 ( PY- 18,007).

(b) Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The entity is exposed to credit risk from its operating activities (primarily trade receivables) and from its

financing activities, financial assets. Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. Credit evaluations are performed on all customers requiring credit over a certain amount.

Trade receivables and loans

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

An impairment analysis is performed at each reporting date on an individual basis for receivables and loans. The calculation is based on historical data. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in note below. The group does not hold collateral as security. The group evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and has been rated highly based on internal credit assessment parameters.

Financial instruments and cash deposits

Credit risk from balances with banks and financial institutions is managed by the entity''s treasury department in accordance with the entity''s policy. Counterparty credit limits are reviewed by the entity''s Board of Directors on an annual basis. The limits are set to minimise the concentration of risks and therefore mitigate financial loss through counterparty''s potential failure to make payments.

(c) Liquidity Risk

The entity monitors its risk of shortage of funds on a regular basis. The entity''s objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts and bank loans. The entity assessed the concentration of risk with respect to refinancing its debt and concluded it to below.

The table below summarises the maturity profile of the group''s financial liabilities based on contractual undiscounted payments:

For the purpose of the entity''s capital management, capital includes issued equity share capital and other equity attributable to the equity holders of the entity. The primary objective of the entity''s capital management is to maximise the shareholder wealth.

The entity''s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. The Board of Directors monitor the return on capital employed as well as the level of dividend to shareholders.

The entity manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the entity may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The entity monitors capital using a debt equity ratio, which is net debt divided by total capital. The entity''s policy is to keep the debt equity ratio between 100% to 200%. The entity includes within net debt, interest bearing loans and borrowings, less cash and cash equivalents, excluding discontinued operations.The group manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the group may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The group monitors capital using a debt equity ratio, which is net debt divided by total capital. The group''s policy is to keep the debt equity ratio between 70% and 100%. The group includes within net debt, interest bearing loans and borrowings, less cash and cash equivalents, excluding discontinued operations.

Note :- 58

The Company''s interest and share in subsidiaries are set out below. Unless otherwise stated, the proportion of ownership interests held equals the voting rights held by the Company, directly or indirectly, and the country of incorporation or registration is also their principal place of business.

Note 59

World Health Organisation (WHO) declared outbreak of Coronavirus Disease (COVID-19) a global pandemic on March 11,2020.

Consequent to this, Government of India declared lockdown on March 23, 2020, but now lift up shut down, hence no impact due to covid lockdown.

1 Details of Benami property: No proceedings have been initiated or are pending against the company for holding any Benami property under the Benami Transactions (Prohibition) Act, 1988 and the rules made thereunder.

2 Transaction with Struck Off Companies: The Company do not have any transaction with companies struck off dueing the current and previous year.

3 Charges with Registrar of Companies: The Company do not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

4 Details of crypto currency or virtual currency: The Company has not traded or invested in Crypto currency or Virtual Currency during the current or previous year.

5 Utilisation of borrowed funds and share premium:

(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.

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 Funding Party (Ultimate Beneficiaries) or

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

6 Compliance with approved scheme(s) of arrangements: The Company has not entered into any scheme of arrangement

which has an accounting impact on current or previous financial year.

7 Valuation of PPE, Intangible Assets and Investment property: The Company has not revalued its property, plant & equipment (including Right Of Use Assets) or intangible assets or both during the current or previous year.

8 Loan/advances to specified persons: There is no details available for grant of loans/advances in the nature of loans repayable on demand.

9 Undisclosed income: There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.

10 Intangible asset under development: The Company has no intangible asset under development.

11 The company has not submitted the returns with banks in respect of working capital loans.

12 All amounts disclosed in the financial statements and notes have been round off to or nearest in lakhs as per the schedule

III requirements, unless otherwise stated.

Previous year figures have been regrouped and reclassified wherever necessary to make them comparable. The Accompanying notes form an integral Part of the financial Statement

1

Under the Guarantee Agreement Spentex Industries Limited ,the guarantor, guaranteed the performance and execution of

2

the undertaking the obligation upon it under the Investment Agreement. In terms of clause 25.18 of Investment Agreement, the guarantee had to be renewed every year, however since all the needful compliance intended as per the Investment Agreement

---

Mar 31, 2016

Sub Note:- 1 (a) The company has only one class of equity share having a par value of Rs. 10/- per share. Each Shareholder is eligible for one vote per share. The dividend proposed, if any, by the Board of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting, except in case of interim dividend. 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 of their shareholding.

Sub Note:- 2 (b) Reconciliation of number of shares outstanding at the beginning and at the end of the year.

Nature of security	Repayment terms, amount and period of default
Debentures
Non convertible debentures
Secured by first pari-passu charge on fixed assets of the	Amounting to Rs. 155,888,356 (previous year Rs. 212,114,334)
Company both present and future and additionally secured	repayable in 24 quarterly installments commencing from June,
by personal guarantees of Mr. Mukund Choudhary and Mr.	2012. An amount of Rs. 14,556,866 (previous year Rs. 12,477,314/-
Kapil Choudhary. These Debentures are further secured by	) was due for payment as on 31.03.2016 is yet to be paid. For
second pari-passu charge on entire current assets of the	repayment schedule refer table below.
Company. These debentures are also secured by pledge of
24,575,918 shares of the company held by promoters and further secured by collateral security of property at 1st floor, 7, Padmini Enclave, Hauz Khas, New Delhi.

a. Term loans from bank

i) Secured by first pari-passu charge on fixed assets of the Company both present and future and additionally secured by personal guarantees of Mr. Ajay Choudhary, Mr. Mukund Choudhary and Mr. Kapil Choudhary and third party guarantee of Mrs. Jyoti Choudhary. These loans are further secured by second pari-passu charge on entire current assets of the Company. These loan are also secured by pledge of 24,575,918 shares of the company held by promoters and further secured by collateral security of property at 1st floor, 7, Padmini Enclave, Hauz Khas, New Delhi. 8,113,806 (P.Y. 20,647,140) shares of promoters have also been pledged on exclusive basis for an amount of Rs. 242,830,905 (Rs. 258,007,836), Further secured by third charge on all the movable and immovable assets of the Company.

Amounting to Rs. 792,890,900 (previous year Rs. 817,029,503) repayable in 24 quarterly installments commencing from June, 2012. An amount of Rs. 748,747,430 (previous year Rs. 50,529,038) existed on 31.03.2016, which ranges from 1 to 699 days till 31.03.2016, is yet to be paid. For repayment schedule refer table no. 1 below.

Amounting to Rs. 211,677,452 (previous year Rs. 221,025,127) repayable in 20 quarterly installments commencing from June, 2012. An amount of Rs. 169,347,003 (previous year Rs. 20,645,000) existed on 31.03.2016, which ranges from 1 to 699 days till 31.03.2016, is yet to be paid. For repayment schedule refer table no. 2 below.

Amounting to Rs. Nil (previous year Rs. 7,240,975) repayable in 12 quarterly installments commencing from June, 2012. An amount of Rs. Nil (previous year Rs. 7,240,975) was due for payment on 31.03.2016 is yet to be paid. For repayment schedule refer table no. 3 below.

Amounting to Rs. 242,830,905 (previous year Rs. 258,007,836) repayable in 23 quarterly installments commencing from June, 2012. An amount of Rs. 242,830,905 (previous year Rs. 15,176,932) existed on 31.03.2016, which ranges from 1 to 699 days till 31.03.2016, is yet to be paid. For repayment schedule refer table no. 1 below.

b. Funded Interest Term Loan

i) Secured by first pari-passu charge on all the fixed assets of the Company, both present and future. The loan is further secured by second pari-passu charge on entire on entire current assets of the Company and additionally secured by personal guarantee of Mr. Ajay Choudhary, Mr. Mukund Choudhary and Mr. Kapil Choudhary. The loan is

Amounting to Rs. 15,378,904 (previous year Rs.15, 378,904) repayable in 2018. There is no default in repayment of loan existing as on 31.03.2016.

Amounting to Rs.64, 119,519 (previous year Rs.85, 215,810) repayable in 16 quarterly installments commencing from June, 2012. An amount of Rs. 62,487,206 (previous year Rs.15, 264,030) also secured by pledge 24,575,918 shares of the Company on pari-passu basis. Loan amounting to Rs. 64,119,519 (Rs. 85,215,810) is further secured by collateral security of property at 1st floor, 7, Padmini Enclave, Hauz Khas, New Delhi.

c. Working Capital Term Loan Secured by first pari-passu charge on fixed assets of the Company both present and future and additionally secured by personalguarantees of Mr. Ajay Choudhary, Mr. Mukund Choudhary and Mr. Kapil Choudhary and third party guarantee of Mrs. Jyoti Choudhary. These loans are further secured by second pari-passu charge on entire current assets of the Company. These loans are also secured by pledge of 24,575,918 shares of the Company and further secured by collateral security on the property at 1st floor, 7, Padmini Enclave, Hauz Khas, New Delhi.

Amounting to Rs. 154,793,686 (previous year Rs. 162,447,805) repayable in 24 quarterly installments commencing from June, 2012. An amount of Rs. 154,793,686 (previous year Rs. 9,562,800) existed on 31.03.2016, which ranges from 1 to 699 days till 31.03.2016, is yet to be paid. For repayment schedule refer table no. 1 below.

Amounting to Rs. 285,454,059 (previous year Rs. 294,716,614) repayable in 24 quarterly installments commencing from June, 2012. An amount of Rs. 261,425,120 (previous year Rs. 20,703,750) existed on 31.03.2016, which ranges from 1 to 699 days till 31.03.2016, is yet to be paid. For repayment schedule refer table no. 2 below. Amounting to Rs. 315,767,320 (previous year Rs. 319,269,714) repayable in 24 quarterly installments commencing from June, 2012. An amount of Rs. 290,050,602 (previous year Rs. 22,290,000) existed on 31.03.2016, which ranges from 1 to 699 days till 31.03.2016, is yet to be paid. For repayment schedule refer table no. 3 below.

d. Corporate Loan

Secured by first pari-passu charge on the entire current assets of the Company including receivables. Additionally secured by personal guarantees of Mr. Ajay Choudhary, Mr. Mukund Choudhary and Mr. Kapil Choudhary and third party guarantee of Mrs. Jyoti Choudhary. These loans are further secured by collateral security on entire fixed assets of the Company, also secured by pledge of 24,575,918 shares of the Company and collateral security on the property at 1st floor, 7, Padmini Enclave, Hauz Khas, New Delhi.

Amounting to Rs. 264,468,515 (previous year Rs. 312,500,000) repayable in 18 quarterly installments commencing from June, 2015. An amount of Rs. 200,312,514 (previous year Rs. 24,722,222) existed on 31.03.2016, which ranges from 1 to 699 days till 31.03.2016, is yet to be paid. For repayment schedule refer table no.1 below. Amounting to Rs. 27,563,366 (previous year Rs. 27,900,000) repayable in 18 quarterly installments commencing from September, 2015. An amount of Rs. 27,563,366 (previous year Rs. 1,550,000) existed on 31.03.2016, which ranges from 1 to 699

- The Company believes that the corporate guarantee issued on behalf of its Step down subsidiary namely Spentex Tashkent Toytepa LLC (STTL) for deferred payment to TTL stands extinguished as all the assets and liabilities of STTL have been taken over by National Bank of Uzbekistan (NBU) and existence of STTL has been liquidated as per bankruptcy laws. Accordingly, the figure of current year does not include the portion of the guarantee relating to the deferred liability of TTL.

- The Company believes that the corporate guarantee given to Lehman Brothers is no longer valid as Lehman Brothers did not comply with the terms and conditions of the loan agreement based on which the guarantee was given. Accordingly, the figure for the current year and previous year do not include the portion of the guarantee relating to the loan from Lehman Brothers.

The amount shown in the items (a) to (e) represent the best possible estimates arrived at on the basis of available information. The uncertainties and possible reimbursements are dependent on outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be predicted accurately. The Company engages reputed professional advisors to protect its interest and has been advised that it has strong legal positions against such disputes. The amount shown in items (f) to (l) represent guarantees given and bills discounted in the normal course of the Company''s operations and are not expected to result in any loss to the Company on the basis of beneficiaries fulfilling their ordinary commercial obligations.

NOTE 1: EMPLOYEE BENEFIT PLAN

(i) Post Retirement Employee Benefits

(a) Defined Contribution Plans:

The Company has defined contribution plans for post retirement employment benefits'' namely Provident Fund and Employee State Insurance Scheme. Expenses for the same are being charged to statement of profit and loss for the year.

(b) Defined Benefit Plans:

The liability for gratuity is determined on the basis of an actuarial valuation, using the projected unit credit (PUC) method at the end of the year. Gains and losses arising out of actuarial valuations are recognized in the statement of profit and loss for the year. Liabilities for compensated absences which is a defined benefit plan are determined based on independent year end actuarial valuation and the resulting charge is being accounted in statement of profit and loss.

(ii) Other Employee Benefits

Other employee benefits are accounted for on accrual basis.

H. Basis used to determine the Expected Rate of Return on Plan Assets

The expected rate of return on plan assets is based on the current portfolio of assets, investment strategy and market scenario. In order to protect the capital and optimize returns within acceptable risk parameters, the plan assets are well diversified.

NOTE 2: SEGMENT REPORTING :

In accordance with Accounting Standard - 17 on Segment Reporting issued by the Institute of Chartered Accountants of India, the Company has identified three business segments viz. Textile Manufacturing, Textile Trading and Other Trading. Further, two geographical segments by location of customers have been considered as secondary segments viz, within India

NOTE 3: RELATED PARTY DISCLOSURES :

In accordance with the requirements of Accounting Standard (AS) - 18 on Related Party Disclosures, the names of the related parties where control exists and/or with whom transactions have taken place during the year and description of relationships, as identified and certified by the management, are :

Enterprises under Significant Influence:

i) Himalayan Crest Power Pvt. Limited

ii) CLC & Sons (Pvt.) Limited

iii) CLC Technologies Private Limited

i)	Mr.Ajay Kumar Choudhary	Chairman & Whole time Director
ii)	Mr. Mukund Choudhary	Managing Director
iii)	Mr. Kapil Choudhary	Deputy Managing Director
iv)	Mr. Amrit Agrawal	Director
v)	Mr. Sitaram Parthasarathy (Ceased to be a director on 07th Nov. 2015)	Director
vi)	Mr. Madhav Choudhary	Son of Deputy Managing Director
vii) Mr.Akash Agrawal		Son of Mr. Amrit Agrawal
Subsidiaries / Step-down Subsidiaries :
i)	M/s Amit Spinning Industries Limited
iii)	M/s Spentex Netherlands B.V
v)	M/s. Schoeller Textile Netherlands B.V.	Botekos Plus s.r.o.

NOTE 4

The company has an investment of Rs. 204,469,921/- in and has amount recoverable amounting to Rs. 732,239,193/- to Amit Spinning Industries Limited (ASIL), a subsidiary, as on March 31, 2016. The accumulated losses of ASIL, at the yearend exceeded its net worth. There is also reduction in market value of the investment at the yearend by Rs. 187,475,249. In the opinion of the management, diminution in this long term investment is due to adverse business conditions in the past. Management believes that diminution in the value of investment is of temporary nature and that outstanding would be realized within a reasonable period of time. Accordingly no provision considered necessary in the value of investment held and amount due from ASIL.

NOTE 5:

The Company has an investment of Rs. 561,011,339 and Rs. 9,323,779 in its subsidiary Spentex Netherlands B. V. (SNBV) and its step down subsidiary Spentex Tashkent Toytepa LLC (STTL) respectively. Further it has Rs. 70,012,404 as export receivable from STTL and advances recoverable of Rs. 95,070,902 in SNBV as on March 31st, 2016. During the period of investment, Government of Uzbekistan (GOU) changed certain laws and policies breaching the investment agreement and rendered operation of STTL not only unviable, but also expropriated its investment. All the assets and liabilities of STTL have been taken over by National Bank of Uzbekistan (NBU) and existence of STTL has been liquidated as per bankruptcy laws. In view of this corporate guarantee given by company in respect of STTL liability for deferred payment to Tashkent Toytepa Textile (TTL) stand extinguished. SNBV, which had made around 99% investment in the equity of STTL, had filed request for Arbitration against GOU for Claim through its lawyer before International Center for Settlement Investment Dispute(ICSID). Based on the claim lodged with ICSID, Board of Directors have decided not to make any provision for the aforesaid amounts. In addition to above claim, the company has sent notice to the GOU for indemnify the further losses caused to company directly or indirectly on account of investment made in Uzbekistan.

NOTE 6:

The accumulated losses of the Company had exceeded its net worth during the year 2011-12. Accordingly company in compliance with the provisions of section 15(1) of Sick Industrial Companies (Special Provisions) Act, 1985 filed a reference with Board for Industrial and Financial Restructuring (BIFR). The company''s operations were adversely affected in earlier financial years due to sluggish market demand, greater decline in cotton prices globally as compared to India, higher power cost in Maharashtra, certain policies of the Government and shortage of working capital. In spite of unfavorable market scenario and financial constraints, the units of the company continue to operate at satisfactory capacity utilization levels and are generating positive Earnings before Interest Depreciation Tax and Amortization (EBIDTA). The Company''s account has become Non Performing Assets (NPA) with majority of the dealing banks and the company is also in receipt of NPA cum recall notice. The company has submitted / in process of submitting restructuring proposal proposing various alternative to the banks which is currently under discussion. With strong management focus on strategic initiatives on cost rationalization, optimum product mix and efficient plant operations, the management believes that accumulated losses would reasonably be paired in due course. The financial statements, as such have been prepared on a going concern basis.

NOTE 7:

Advance balance of Rs. 18,410,722 from a party where payments are not forthcoming. Against the above, the Company has filed a suit for recovery. In addition to above for Rs. 12,830,469 (Rs. 12,830,469) dues from Government Authorities company filed an application for release with concerned authorities. The Company is making effort to recover the same and expects to reduce the outstanding dues significantly. Based on outcome of the legal suit coupled with further negotiations with these parties, the management is of the opinion that ultimately there would be no losses against these old balances and hence no provision is considered necessary at this stage.

NOTE 8:

Advance balances aggregating to Rs. 55,982,580 are due from certain parties where payments are not forthcoming. The company is making appropriate concerted efforts including negotiations with these parties to recover the same and expect to reduce the outstanding dues significantly. The management is of the view that ultimately there would be no losses against these outstanding balances and hence no provision is considered necessary at this stage.

NOTE 9:

The company has applied to Securities & Exchange Board of India (SEBI) seeking exemption for maintaining at least 15% of the amount of its debenture maturing during the financial year 2016-17 vide circular no 04/2013 dated 11-Feb-2013 issued by Ministry of Corporate Affair, which is still awaited.

NOTE 10:

The outstanding balance as on 31st March, 2016 in respect of certain trade receivables, trade payables and loans & advances are subject to confirmation/reconciliation and consequential adjustment if any, from the respective parties. The management, however, does not expect any material variations.

NOTE 11:

Pursuant to compliance of clause 34(3) of the Listing Agreement, on disclosure of Loans / Advances in the nature of loans, the relevant information is provided hereunder: (Amount in Rs.)

NOTE 12:

Extraordinary items represents write back of Rs. Nil (P.Y. Rs. 13,717,503) due to loan waiver from lender.

NOTE 13:

The company''s accounts have become Nonperforming assets (NPA) with majority of the dealing banks. The company has submitted restructuring proposal proposing various alternatives to the banks which is under discussions. None of the banks has initiated action in any legal forum. The company has provided interest on such loans, however penal interest, if any, has not been provided.

NOTE 14:

For the year ended March 31, 2016, the Company has initiated the process of compliance with the transfer pricing regulations for which the prescribed certificate of the accountant will be obtained. The management is of the opinion that the transactions are arms length price. Hence the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and the provision for taxation.

NOTE 15:

Previous year figures have been regrouped and reclassified wherever necessary to make them comparable.

Notes referred to above form an integral part of financial Statements.

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Mar 31, 2015

1. The Company has not allotted shares against this amount which was brought in by the promoters in more than one installments under restructuring scheme approved by the Bankers. Due to pending necessary approvals for allotment of shares, the Company has not complied with the provisions of Section 42 of the Companies Act, 2013.

a. Term loans from bank

Secured by first pari-passu charge on fixed assets of the Company both present and future and additionally secured by personal guarantees of Sh. Ajay Choudhary, Sh. Mukund Choudhary and Sh. Kapil Choudhary and third party guarantee of Mrs. Jyoti Choudhary. These loans are further secured by second pari-passu charge on entire current assets of the Company. These loan are also secured by pledge of 24,575,918 shares of the company held by promoters and further secured by collateral security of property at 1st floor, 7, Padmini Enclave, Hauz Khas, New Delhi. 20,647,140 shares of promoters have also been pledged on exclusive basis for an amount of ' 258,007,836 /-, Further secured by third charge on all the movable and immovable assets of the Company and personal guarantee of Sh. Ajay Choudhary, Sh Mukund Choudhary and Sh. Kapil Choudhary.

b. Funded Interest Term Loan

Secured by first pari-passu charge on all the fixed assets of the Company, both present and future. The loan is further secured by second pari-passu charge on entire on entire current assets of the Company and additionally secured by personal guarantee of Sh. Ajay Choudhary,

Amounting to ' 15,378,904 (previous year ' 15,378,904) repayable in 2018. There is no default in repayment of loan existing as on 31.03.2015.

Amounting to ' 85,215,810 (previous year ' 139,301,510) repayable in 16 quarterly installments commencing from June,

c. Working Capital Term Loan

Secured by first pari-passu charge on fixed assets of the Company both present and future and additionally secured by personal guarantees of Sh. Ajay Choudhary, Sh. Mukund Choudhary and Sh. Kapil Choudhary and third party guarantee of Mrs. Jyoti Choudhary. These loans are further secured by second pari-passu charge on entire current assets of the Company. These loans are also secured by pledge of 24,575,918 shares of the Company and further secured by collateral security on the property at 1st floor, 7, Padmini Enclave, Hauz Khas, New Delhi.

d. Corporate Loan

Secured by first pari-passu charge on the entire current assets of the Company including receivables. Additionally secured by personal guarantees of Sh. Ajay Choudhary, Sh. Mukund Choudhary and Sh. Kapil Choudhary and third party guarantee of Mrs. Jyoti Choudhary. These loans are further secured by collateral security on entire fixed assets of the Company, also secured by pledge of 24,575,918 shares of the Company and collateral security on the property at 1st floor, 7, Padmini Enclave, Hauz Khas, New Delhi.

2. Nature of Security

Working Capital Loans from Banks are secured by first pari-passu charge on entire current assets, long term loan and advances and other non current assets of the Company. These loans are further secured by second pari-passu charge on entire fixed assets, both present and future and personal guarantee of the promoters. These loans, are also secured by pledge of promoters' shares (24,575,918 nos.) on pari-passu basis.

* The short term borrowings of the company have generally remained overdue during the substantial part of the financial year.

The overdue amount as 31st March 2015 was ' 203,189,847.

** Repayable in April 2015.

* For security details and other terms and conditions, refer note no. 5 of financial statement.

** 1) There is a default of ' 85,878,506 /- (previous year Rs. 83,058,604) existing as on 31.03.2015 which ranges from 1 to 90 days. 2) There is a default of Rs. 12,191,845 /- (previous year Rs. Nil) existing as on 31.03.2015 which ranges from 59 to 333 days.

* The Company believes that the corporate guarantee issued on behalf of its Step down subsidiary namely Spentex Tashkent Toytepa LlC (STTL) for deferred payment to TTL stand extinguished as all the assets and liabilities of STTL have been taken over by National Bank of Uzbekistan (NBU) and existence of STTL has been liquidated as per bankruptcy laws. Accordingly, the figure of current year does not include the portion of the guarantee relating to the deferred liability of TTL.

** The Company believes that the corporate guarantee given to Lehman Brothers is no longer valid as Lehman Brothers did not comply with the terms and conditions of the loan agreement based on which the guarantee was given. Accordingly, the figure for the current year and previous year do not include the portion of the guarantee relating to the loan from Lehman Brothers.

The amount shown in the items (a) to (e) represent the best possible estimates arrived at on the basis of available information. The uncertainties and possible reimbursements are dependent on outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be predicted accurately. The Company engages reputed professional advisors to protect its interest and has been advised that it has strong legal positions against such disputes. The amount shown in items (f) to (l) represent guarantees given and bills discounted in the normal course of the Company's operations and are not expected to result in any loss to the Company on the basis of beneficiaries fulfilling their ordinary commercial obligations.

NOTE 3 : EMPLOYEE BENEFIT PLAN

(i) Post Retirement Employee Benefits

(a) Defined Contribution Plans:

The Company has defined contribution plans for post retirement employment benefits' namely Provident Fund and Employee State Insurance Scheme. Expenses for the same is being charged to statement of profit and loss for the year.

(b) Defined Benefit Plans:

The liability for gratuity is determined on the basis of an actuarial valuation , using the projected unit credit (PUC) method at the end of the year. Gains and losses arising out of actuarial valuations are recognised in the statement of profit and loss for the year. Liabilities for compensated absences which is a defined benefit plan are determined based on independent year end actuarial valuation and the resulting charge is being accounted in statement of profit and loss.

(ii) Other Employee Benefits

Other employee benefits are accounted for on accrual basis.

H. Basis used to determine the Expected Rate of Return on Plan Assets

The expected rate of return on plan assets is based on the current portfolio of assets, investment strategy and market scenario. In order to protect the capital and optimize returns within acceptable risk parameters, the plan assets are well diversified.

NOTE 4 : RELATED PARTY DISCLOSURES :

In accordance with the requirements of Accounting Standard (AS) - 18 on Related Party Disclosures, the names of the related parties where control exists and/or with whom transactions have taken place during the year and description of relationships, as identified and certified by the management, are :

Enterprises Under Significant Influence:

i) Himalayan Crest Power Pvt. Limited

ii) CLC & Sons (Pvt.) Limited

iii) CLC Technologies Private Limited

Key Management Personnel and their relatives :

i) Sh. Ajay Kumar Choudhary Chairman & Whole time Director

ii) Sh. Mukund Choudhary Managing Director

iii) Sh. Kapil Choudhary Deputy Managing Director

iv) Sh. Amrit Agrawal Director

v) Sh. Sitaram Parthasarathy Director

vi) Sh. Raghav Choudhary Son of Sh. Mukund Choudhary

vii) Ms. Megha Agrawal Daughter of Sh. Amrit Agrawal

viii) Sh. Akash Agrawal Son of Sh. Amrit Agrawal

Subsidiaries / Step-down Subsidiaries :

i) M/s Amit Spinning Industries Limited ii) M/s Spentex Tashkent Toytepa LLC

iii) M/s Spentex Netherlands B.V iv) M/s. Schoeller Litvinov k.s.

v) M/s. Schoeller Textile Netherlands B.V vi) M/s. Botekos Plus s.r.o.

vii) M/s. Spentex (Mauritius) Private Limited (The Company ceased to exist on 25th March 2015)

NOTE 5:

The Butibori Unit of the Synthetic Division had been exporting its goods under Rule 18 of the Central Excise Rules 2002 and claiming rebate on both input and output stage of duty. The Central Excise Department disallowed the rebate on Input Stage of duty at Butibori unit. The Synthetic Division has filed a revision petition with the Joint Secretary, Government of India who allowed rebate for both the stages of duty.

However, the Department appealed in the Hon'ble High Court of Mumbai which was upheld by the Hon'ble High Court. The Synthetic Division has now filed a Special Leave Petition before the Hon'ble Supreme Court of India for quashing the Hon'ble High Court Order and allowing the rebate on input stage of duty.

Pending the decision in the matter by the Hon'ble Supreme Court, the Synthetic Division has not yet reversed the rebate receivable on input duty aggregating to ' 23,128,387 (including ' 2,826,621 at its Pithampur Unit).

Further, relying on the judgment of the Hon'ble High Court of Mumbai for the Butibori unit, a demand has been raised by the Department on the Pithampur unit of the Synthetic Division against the refund already given of the rebate on input stage of duty amounting to ' 6,02,16,366/- along with interest. Also, pending claims for the input stage of duty amounting to ' 2,826,621/- have been disallowed during 2006-07. The Pithampur unit has gone into appeal against the said demand / disallowance. The Commissioner (Appeals) has rejected the appeal of the Synthetic Division for the pending claim, while the decision has been kept pending against the demand till the final order is received from the higher authority (Revision Authority).

While the management is hopeful of the decision of the case in its favour, it is also reasonably confident of the liquidation / utilization of these cenvat balances of Rs. 83,344,753/-

NOTE 6:

The company has an investment of Rs. 204,469,921/- in and has amount recoverable amounting to Rs. 642,244,069/- to Amit Spinning Industries Limited (ASIL), a subsidiary, as on March 31,2015. The accumulated losses of ASIL, at the year end exceeded its net worth. There is also reduction in market value of the investment at the year end by ' 184,537,898. In the opinion of the management, diminution in this long term investment is due to adverse business conditions in the past. ASIL has started generating EBIDTA and cash profits. In view of these developments, management believes that diminution in the value of investment is of temporary nature and that outstanding would be realised within a reasonable period of time. Accordingly no provision considered necessary in the value of investment held and amount due from ASIL.

NOTE 7:

The Company has an investment of ' 561,011,339 and Rs. 9,323,779 in its subsidiary Spentex Netherlands B. V. (SNBV) and its step down subsidiary Spentex Tashkent Toytepa LLC (STTL) respectively. Further it has ' 70,012,404 as export receivable from STTL and advances recoverable of Rs. 95,070,902 in sNbV as on March 31st, 2015. During the period of investment, Government of Uzbekistan (GOU) changed certain laws and policies breaching the investment agreement and rendered operation of STTL not only unviable, but also expropriated its investment. All the assets and liabilities of STTL have been taken over by National Bank of Uzbekistan (NBU) and existence of STTL has been liquidated as per bankruptcy laws. In view of this corporate guarantee given by company in respect of STTL liability for deferred payment to Tashkent Toytepa Textile (TTL) stand extinguished. SNBV , which had made around 99% investment in the equity of StTl, had filed request for Arbitration against GOU for Claim through its lawyer before International Center for Settlement Investment Dispute(ICSID). As per the schedule prescribed in the procedural order issued by ICSID, SNBV has filed the memorial on Jurisdictions and Merits on 30th June, 2014. Based on the claim lodged with ICSID, Board of Directors have decided not to make any provision for the aforesaid amounts. In addition to above claim, the company has sent notice to the GOU for indemnify the further losses caused to company directly or indirectly on account of investment made in Uzbekistan.

NOTE 8:

As on March 31,2012, the accumulated losses of the Company had exceeded its net worth. Accordingly company in compliance with the provisions of section 15(1) of Sick Industrial Companies (Special Provisions) Act, 1985 filed a reference with Board for Industrial and Financial Restructuring (BIFR). The Company's operations were adversely affected in 2011-12 due to adverse Govt policies and high volatility of Raw Material prices. Further, considering the change in scenario, recent performance and trends of the company as well as overall industry outlook, the management believes that losses incurred in the past would reasonably be made good, in due course. The financial statements, as such have been prepared on a going concern basis on the strength of management's plan of revival including reorganization of business.

NOTE 9:

Trade receivables, advance balances and receivables amount aggregating to Rs. 63,71,477, ' 2,73,14,712, Rs. 17,869,256 respectively due from certain parties where payments are not forthcoming. Against the above, the Company has filed a suit for recovery. In addition to above for ' 12,830,469 (P.Y. 12,830,469) dues from Government Authorities company filed an application for release with concerned authorities. The Company is making effort to recover the same and expects to reduce the outstanding dues significantly. Based on outcome of the legal suit coupled with further negotiations with these parties, the management is of the opinion that ultimately there would be no losses against these old balances and hence no provision is considered necessary at this stage.

NOTE 10:

The company has applied to Securities & Exchange Board of India (SEBI) seeking exemption for maintaining at least 15% of the amount of its debenture maturing during the financial year 2013-14, 2014-15 and 2015-16 vide circular no 04/2013 dated 11-Feb- 2013 issued by Ministry of Corporate Affair, which is still awaited.

NOTE 11:

The outstanding balance as on 31st March, 2015 in respect of certain trade receivables, trade payables and loans & advances are subject to confirmation/reconciliation and consequential adjustment if any, from the respective parties. The management, however, does not expect any material variations.

NOTE 12:

Extraordinary items represents write back of '13,717,503 due to loan waiver from lender.

NOTE 13:

During the year ended 31st March, 2015, the company has revised the Depreciation rates based on the useful lives of its various fixed assets as per Part-C of Schedule-II to the Companies Act-2013. As a result, depreciation for year ended 31st March, 2015 is lower by ' 29,522,452. Further, in respect of fixed assets whose life has been expired as on 31st March 2014 an amount of ' 12,182,909 (net of related deferred tax of ' 6,017,651) has been adjusted with General Reserve.

NOTE 14:

For the year ended March 31,2015, the Company has initiated the process of compliance with the transfer pricing regulations for which the prescribed certificate of the accountant will be obtained. The management is of the opinion that the transactions are arms length

price. Hence the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and the provision for taxation.

NOTE 15:

Previous year figures have been regrouped and reclassified wherever necessary to make them comparable.

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Mar 31, 2014

SUB NOTE:- 1 (a) The company has only one class of equity share having a par value of Rs 10/- per share. Each Shareholder is eligible for one vote per share. The dividend proposed, if any by the Board of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting, except in case of interim dividend. 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 of their shareholding.

SUB NOTE:- 1 (b) Reconciliation of number of shares outstanding at the beginning and at the end of the year

During the year, out of money received against share warrants , the company has allotted 14,00,000 (previous year 51,00,000) equity shares pursuant to options exercised by the share warrants holder CLC Technologies Private Limited to convert 14,00,000 (previous year 51,00,000) share warrants in equal number of fully paid up equity shares at the agreed price of Rs 10/- per equity share (previous year Rs 10/- pre equity share)

Nature of security Debentures

Non convertible debentures

Secured by first pari-passu charge on fixed assets of the Company both present and future and additionally secured by personal guarantees of Mr. Mukund Choudhary and Mr. Kapil Choudhary. These Debentures are further secured by second pari-passu charge on entire current assets of the Company. These debentures are also secured by pledge of 24,575,918 shares of the company held by promoters and further secured by collateral security of property at 1st floor, 7, Padmini Enclave, Hauz Khas, New Delhi.

Repayment terms, amount and period of default

Amounting to Rs262,023,589 (previous year Rs 307,773,740) repayable in 24 quarterly installments commencing from June, 2012. An amount of Rs 124,77,314/- (previous year Rs 83,18,209) was due for payment as on 31.03.2014 is yet to be paid. For repayment schedule refer table below.

a. Term loans from bank

Secured by first pari-passu charge on fixed assets of the Company both present and future and additionally secured by personal guarantees of Mr. Ajay Choudhary, Mr. Mukund Choudhary and Mr. Kapil Choudhary and third party guarantee of Mrs. Jyoti Choudhary. These loans are further secured by second pari-passu charge on entire current assets of the Company. These loan are also secured by pledge of 24,575,918 shares of the company held by promoters and further secured by collateral security of property at 1st floor, 7, Padmini Enclave, Hauz Khas, New Delhi. 20,647,140 shares of promoters have also been pledged on exclusive basis for an amount of Rs 318,715,563 /-, Further secured by third charge on all the movable and immovable assets of the Company and personal guarantee of Mr. Ajay Choudhary, Sh Mukund Choudhary and Mr. Kapil Choudhary.

Amounting to Rs 1,014,206,877 (previous year Rs 1,179,943,869) repayable in 24 quarterly installments commencing from June, 201 2. An amount of Rs 47,582,957/- (previous year Rs 31,715,467) was due for payment on 31.03.2014 is yet to be paid. For repayment schedule refer table no. 1 below.

Amounting to Rs 319,106,856 (previous year Rs 387,021,984) repayable in 20 quarterly installments commencing from June, 2012. An amount of Rs 16,137,400/- (previous year Rs 15,179,071) was due for payment on 31.03.2014 is yet to be paid. For repayment schedule refer table no. 2 below. Amounting to Rs 41,515,976 (previous year Rs 88,287,415) repayable in 12 quarterly installments commencing from June, 2012. An amount of Rs 12,150,000/- (previous year Rs 93,50,000) was due for payment on 31.03.2014 is yet to be paid. For repayment schedule refer table no. 3 below. Amounting to Rs 43,245,984 (previous year Rs 188,870,984) repayable in 8 quarterly installments commencing from June, 2012. An amount of Rs 4,36,87,500/- (previous year Rs 14,562,500) was due for payment on 31.03.2014 is yet to be paid. For repayment schedule refer table no. 4 below. Amounting to Rs 318,715,563 (previous year Rs 374,364,313) repayable in 23 quarterly installments commencing from June, 2012. An amount of Rs15,176,932/- (previous year Rs 10,117,954) was due for payment on 31.03.2014 is yet to be paid. For repayment schedule refer table no. 1 below.

b. Funded Interest Term Loan

Secured by first pari-passu charge on all the fixed assets of the Company, both present and future. The loan is further secured by second pari-passu charge on entire on entire current assets of the Company and additionally secured by personal guarantee of Mr. Ajay Choudhary, Mr. Mukund Choudhary and Mr. Kapil Choudhary . The loan is also secured by pledge 24,575,918 shares of the Company on pari-passu basis. Loan amounting to Rs 14,09,88,471/- is further secured by collateral security of property at 1st floor, 7, Padmini Enclave, Hauz Khas, New Delhi.

c. Working Capital Term Loan

Secured by first pari-passu charge on fixed assets of the Company both present and future and additionally secured by personal guarantees of Mr. Ajay Choudhary, Mr. Mukund Choudhary and Mr. Kapil Choudhary and third party guarantee of Mrs. Jyoti Choudhary. These loans are further secured by second pari-passu charge on entire current assets of the Company. These loans are also secured by pledge of 24,575,918 shares of the Company and further secured by collateral security on the property at 1st floor, 7, Padmini Enclave, Hauz Khas, New Delhi.

Amounting to Rs 15,378,904 (previous year Rs 15,378,904) repayable in 2018. There is no default in repayment of loan existing as on 31.03.2014.

Amounting to Rs 139,301,510 (previous year Rs 191,265,905) repayable in 16 quarterly installments commencing from June, 2012. An amount of Rs 1,40,07,707/- (previous year Rs 1,07,08,823) was due for payment on 31.03.2014 is yet to be paid. For repayment schedule refer table no.1 below. Amounting to Rs 16,86,961 (previous year Rs 8,500,000) repayable in 8 quarterly installments commencing from June, 2012. An amount of Rs 16,86,961/- (previous year Rs 17,00,000) was due for payment on 31.03.2014 is yet to be paid. For repayment schedule refer table no. 2 below.

Amounting to Rs Nil (previous year Rs 1,281,479) repayable in 4 quarterly installments commencing from June, 2012. An amount of Rs Nil (previous year Rs 12,81,479) was due for payment on 31.03.2014 is yet to be paid.

Amounting to Rs 200,820,366 (previous year Rs 235,781,250) repayable in 24 quarterly installments commencing from June, 2012. An amount of Rs 9,562,800/- (previous year Rs 6,375,250) was due for payment on 31.03.2014 is yet to be paid. For repayment schedule refer table no. 1 below.

Amounting to Rs 358,814,588 (previous year Rs 422,043,582) repayable in 24 quarterly installments commencing from June, 2012. An amount of Rs 17,244,608/- (previous year Rs 11,493,072) was due for payment on 31.03.2014 is yet to be paid. For repayment schedule refer table no. 2 below. Amounting to Rs Nil (previous year Rs 57,158,108) repayable in 2 half yearly installments during September 2012 & March 2013. An amount of Rs Nil (previous year Rs 57,158,108) was due for payment on 31.03.2014 is yet to be paid. The rate of interest is 10% per annum.

Amounting to Rs 392,189,271 (previous year Rs 460,794,535) repayable in 24 quarterly installments commencing from June, 2012. An amount of Rs 18,711,750/- (previous year Rs 12,471,250) was due for payment on 31.03.2014 is yet to be paid. For repayment schedule refer table no. 3 below.

d. Corporate Loan

Secured by first pari-passu charge on the entire current assets of the Company including receivables. Additionally secured by personal guarantees of Mr. Ajay Choudhary, Mr. Mukund Choudhary and Mr. Kapil Choudhary and third party guarantee of Mrs. Jyoti Choudhary. These loans are further secured by collateral security on entire fixed assets of the Company, also secured by pledge of 18,075,918 shares of the Company and collateral security on the property at 1st floor, 7, Padmini Enclave, Hauz Khas, New Delhi.

Amounting to Rs 242,300,000 (previous year Rs Nil) repayable in 18 quarterly installments commencing from June, 2014. For repayment schedule refer table below.

Nature of Security

Working Capital Loans from Banks are secured by first pari-passu charge on entire current assets, long term loan and advances and other non current assets of the Company. These loans are further secured by second pari-passu charge on entire fixed assets, both present and future and personal guarantee of the promoters. These loans, are also secured by pledge of promoters'' shares (24,575,918 nos.) on pari-passu basis.

* For security details and other terms and conditions, refer note no. 5 of financial statement.

** There is a default of Rs 8,30,58,604/- (previous year Rs 5,44,59,088 ) existing as on 31.03.2014 which ranges from 1 to 90 days . *** There is no amount due and outstanding as on balance sheet date to be credited to Investor Education and Protection Fund.

NOTE 2 : CONTINGENT LIABILITIES :

(i) Contingent Liabilities Not Provided for in respect of : (Amount in Rs'')

Description Year ended Year ended March 31,2014 March 31,2013

Contingent Liabilities Not Provided For:

a) Demands from income tax authorities 3,79,71,404 3,79,71,404 under appeal

b) Demands from sales tax authorities 1,02,44,360 92,74,854 under appeal

c) Show cause notices/demands raised 39,21,23,888 24,99,82,370 by excise / customs department (including applicable penalties), not acknowledged as debts

d) Show cause notices/demands raised by 12,50,56,000 12,50,56,000 MP Government / MPEB department , not acknowledged as debts

e) Claims against the company not 62,27,81,103 36,77,12,997 acknowledged as debts

f) Guarantees and letters of credit 24,88,03,656 20,71,58,898 issued on behalf of the company, outstanding at the year end

g) Bills Discounted with banks on behalf 72,46,59,779 1,03,30,94,058 of the company,outstanding at the year end

h) Corporate Guarantee given to IREDA for 18,61,07,179 21,67,45,433 loan to M/s Himalayan Crest Power Private Limited

i) Corporate Guarantee given to AXIS Bank 31,90,50,140 34,82,43,429 Ltd.& UCO Bank for loan to M/s Amit Spinning Industries Limited

j) Corporate Guarantee given to Tashkent 2,58,98,10,000 2,34,76,10,000 Toytepa Textile for deferred payment of purchase consideration on behalf of Spentex Tashkent Toytepa lLc Current Year USD 43,250,000 (previous year USD 43,250,000)

* The Company believes that the corporate guarantee given to Lehman Brothers is no longer valid as Lehman Brothers did not comply with the terms and conditions of the loan agreement based on which the guarantee was given. Accordingly, the figure for the current year and previous year do not include the portion of the guarantee relating to the loan from Lehman Brothers.

The amount shown in the items (a) to (e) represent the best possible estimates arrived at on the basis of available information. The uncertainties and possible reimbursements are dependent on outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be predicted accurately. The Company engages reputed professional advisors to protect its interest and has been advised that it has strong legal positions against such disputes. The amount shown in items (f) to (l) represent guarantees given and bills discounted in the normal course of the Company''s operations and are not expected to result in any loss to the Company on the basis of beneficiaries fulfilling their ordinary commercial obligations

NOTE 3 : DEFINED BENEFIT PLAN :

(I) Post Retirement Employee Benefits

(a) Defined Contribution Plans:

The Company has defined contribution plans for post retirement employment benefits'' namely Provident Fund and Employee State Insurance Scheme. Expenses for the same is being charged to statement of profit and loss for the year.

(b) Defined Benefit Plans:

The liability for gratuity is determined on the basis of an actuarial valuation , using the projected unit credit (PUC) method at the end of the year. Gains and losses arising out of actuarial valuations are recognised in the statement of profit and loss for the year. Liabilities for compensated absences which is a defined benefit plan are determined based on independent year end actuarial valuation and the resulting charge is being accounted in statement of profit and loss.

The estimates of future salary increases, considered in actuarial valuations take account of inflation, seniority, promotion and other relevant factors such as supply and demand factors in the employment market.

H. Basis used to determine the Expected Rate of Return on Plan Assets

The expected rate of return on plan assets is based on the current portfolio of assets, investment strategy and market scenario. In order to protect the capital and optimize returns within acceptable risk parameters, the plan assets are well diversified.

NOTE 4 : SEGMENT REPORTING :

In accordance with Accounting Standard - 17 on Segment Reporting issued by the Institute of Chartered Accountants of India, the Company has identified three business segments viz. Textile Manufacturing, Textile Trading and Other Trading. Further, two geographical segments by location of customers have been considered as secondary segments viz, within India and outside India.

NOTE 5 : RELATED PARTY DISCLOSURES :

In accordance with the requirements of Accounting Standard (AS) - 18 on Related Party Disclosures, the names of the related parties where control exists and/or with whom transactions have taken place during the year and description of relationships, as identified and certified by the management, are :

Enterprises Under Significant Influence:

i) Himalayan Crest Power Pvt. Limited

ii) CLC & Sons (Pvt.) Limited

iii) CLC Technologies Private Limited

Key Management Personnel and their relatives :

i) Mr.Ajay Kumar Choudhary Chairman & Whole time Director

ii) Mr. Mukund Choudhary Managing Director

iii) Mr. Kapil Choudhary Deputy Managing Director

iv) Mr. Amrit Agrawal Director - Finance

v) Mr. Sitaram Parthasarathy Director - Works

vi) Mr. Raghav Choudhary Son of Managing Director

vii) Ms. Megha Agrawal Daughter of Director- Finance

viii) Mr. Suraj Sitaram Son of Director- Works

Subsidiaries / Step-down Subsidiaries :

i) M/s Amit Spinning Industries Limited

ii) M/s Spentex Tashkent Toytepa LLC

iii) M/s Spentex Netherlands B.V

iv) M/s. Schoeller Litvinov k.s.

v) M/s. Schoeller Textile Netherlands B.V.

vi) M/s. Botekos Plus s.r.o.

NOTE 6

The Butibori Unit of the Synthetic Division had been exporting its goods under Rule 18 of the Central Excise Rules 2002 and claiming rebate on both input and output stage of duty. The Central Excise Department disallowed the rebate on Input Stage of duty at Butibori unit. The Synthetic Division has filed a revision petition with the Joint Secretary, Government of India who allowed rebate for both the stages of duty.

However, the Department appealed in the Hon''ble High Court of Mumbai which was upheld by the Hon''ble High Court. The Synthetic Division has now filed a Special Leave Petition before the Hon''ble Supreme Court of India for quashing the Hon''ble High Court Order and allowing the rebate on input stage of duty.

Pending the decision in the matter by the Hon''ble Supreme Court, the Synthetic Division has not yet reversed the rebate receivable on input duty aggregating to Rs 23,128,387 (including Rs 2,826,621 at its Pithampur Unit).Further, relying on the judgment of the Hon''ble High Court of Mumbai for the Butibori unit, a demand has been raised by the Department on the Pithampur unit of the Synthetic Division against the refund already given of the rebate on input stage of duty amounting to Rs 6,02,16,366/- along with interest. Also, pending claims for the input stage of duty amounting to Rs 2,826,621/- have been disallowed during 2006-07. The Pithampur unit has gone into appeal against the said demand / disallowance. The Commissioner (Appeals) has rejected the appeal of the Synthetic Division for the pending claim, while the decision has been kept pending against the demand till the final order is received from the higher authority (Revision Authority).

While the management is hopeful of the decision of the case in its favour, it is also reasonably confident of the liquidation / utilization of these cenvat balances of Rs 83,344,753/- Note 41

The company has an investment of Rs 204,469,921/- in and has amount recoverable amounting to Rs 548,277,206/- to Amit Spinning Industries Limited (ASIL), a subsidiary, as on March 31,2014. The accumulated losses of ASIL, at the year end exceeded its net worth. There is also reduction in market value of the investment at the year end by Rs 196,077,490. In the opinion of the management, diminution in this long term investment is due to adverse business conditions in the past. ASIL has started generating EBIDTA and cash profits. In view of these developments, management believes that diminution in the value of investment is of temporary nature and that outstanding would be realised within a reasonable period of time. Accordingly no provision considered necessary in the value of investment held and amount due from ASIL.

Note 7

The Company has an investment of Rs 56,10,11,339 and Rs 93,23,779 in its subsidiary Spentex Netherlands B. V. (SNBV) and its step down subsidiary Spentex Tashkent Toytepa LLC (STTL) respectively. Further it has Rs 7,00,12,404 as export receivable from STTL and advances of Rs 9,50,70,902 in SNBV as on March 31,2014.During the period of investment, Government of Uzbekistan (GOU) changed certain laws and policies by breaching the investment agreement and rendered operation of STTL unviable and insolvency proceedings have been initiated against it. Since investment agreement entered between GOU and company, Treaties entered between countries were breached, Company has initiated Arbitration proceeding against GOU for protection of investment and dues & compensation dispute Claim in International Centre for Settlement of Investment Dispute (ICSID) SNBV appointed various experts to assess losses suffered by the company. Based on the draft report and claim to be lodged with ICSID, Board of Directors have decided not to make any provision for the aforsaid amounts.

Note 8

As on March 31,2012, the accumulated losses of the Company had exceeded its net worth. Accordingly company in compliance with the provisions of section 15(1) of Sick Industrial Companies (Special Provisions) Act, 1985 filed a reference with Board for Industrial and Financial Restructuring (BIFR). The Company''s operations were adversely affected in 2011-12 due to adverse Govt policies and high volatility of Raw Material prices. Further, considering the change in scenario, recent performance and trends of the company as well as overall industry outlook, the management believes that losses incurred in the past would reasonably be made good, in due course. The financial statements, as such have been prepared on a going concern basis on the strength of management''s plan of revival including reorganization of business.

Note 9

Trade receivables, advance balances and receivables amount aggregating to Rs 63,71,477, Rs 2,73,14,712, Rs 17,869,256 respectively due from certain parties where payments are not forthcoming. Against the above, the Company has filed a suit for recovery. In addition to above for Rs 12,830,469 dues from Government Authorities company filed an application for release with concerned authorities. The Company is making effort to recover the same and expects to reduce the outstanding dues significantly. Based on outcome of the legal suit coupled with further negotiations with these parties, the management is of the opinion that ultimately there would be no losses against these old balances and hence no provision is considered necessary at the stage.

Note 10

The company has applied to Securities & Exchange Board of India (SEBI) seeking exemption for maintaing at least 15% of the amount of its debenture maturing during the financial year 2013-14 vide circular no 04/2013 dated 11-Feb-2013 issued by Ministry of Corporate Affair, which is still awaited.

Note 11

The outstanding balance as on 31st March, 2014 in respect of certain trade receivables, trade payables and loans & advances are subject to confirmation/reconciliation and consequential adjustment if any, from the respective parties. The management, however, does not expect any material variations.

Note 12

Pursuant to compliance of clause 32 of the Listing Agreement, on disclosure of Loans / Advances in the nature of loans, the relevant information is provided hereunder:

Note: The company has not recognized above Deferred Tax assets on account of prudence.

Note 13

For the year ended March 31,2014, the Company has initiated the process of compliance with the transfer pricing regulations for which the prescribed certificate of the accountant will be obtained. The management is of the opinion that the transactions are arms length price. Hence the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and the provision for taxation.

Notes referred to above form an integral part of financial Statements.

Notes referred to above form an integral part of financial Statement

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Mar 31, 2013

NOTE 1 : DEFINED BENEFIT PLAN :

(i) Post Retirement Employee Benefits

(a) Defined Contribution Plans:

The Company has defined contribution plans for post retirement employment benefits’ namely Provident Fund and Employee State Insurance Scheme. Expenses for the same is being charged to statement of profit and loss for the year.

(b) Defined Benefit Plans:

The liability for gratuity is determined on the basis of an actuarial valuation , using the projected unit credit (PUC) method at the end of the year. Gains and losses arising out of actuarial valuations are recognised in the statement of profit and loss for the year. Liabilities for compensated absences which is a defined benefit plan are determined based on independent year end actuarial valuation and the resulting charge is being accounted in statement of profit and loss.

(ii) Other Employee Benefits

Other employee benefits are accounted for on accrual basis.

NOTE 2 : SEGMENT REPORTING :

In accordance with Accounting Standard - 17 on Segment Reporting issued by the Institute of Chartered Accountants of India, the Company has identified three business segments viz. Textile Manufacturing, Textile Trading and Other Trading. Further, two geographical segments by location of customers have been considered as secondary segments viz, within India and outside India.

NOTE 3 : RELATED PARTY DISCLOSURES :

In accordance with the requirements of Accounting Standard (AS) - 18 on Related Party Disclosures, the names of the related parties where control exists and/or with whom transactions have taken place during the year and description of relationships, as identified and certified by the management, are :

Enterprises Under Significant Influence:

i) Himalayan Crest Power Pvt. Limited

ii) CLC & Sons (Pvt.) Limited

iii) CLC Technologies Private Limited

Key Management Personnel and their relatives :

i) Mr. Ajay Kumar Choudhary Chairman & Whole time Director

ii) Mr. Mukund Choudhary Managing Director

iii) Mr. Kapil Choudhary Deputy Managing Director

iv) Mr. Amrit Agrawal Director - Finance

v) Mr. Sitaram Parthasarathy Director - Works

vi) Mr. Raghav Choudhary Son of Managing Director

vii) Ms. Megha Agrawal Daughter of Director- Finance

viii) Mr. Suraj Sitaram Son of Director- Works

Subsidiaries / Step-down Subsidiaries :

i) M/s Amit Spinning Industries Limited

ii) M/s Spentex Tashkent Toytepa LLC iii) M/s Spentex Netherlands B.V iv) M/s. Schoeller Litvinov k.s.

v) M/s. Schoeller Textile Netherlands B.V. vi) M/s. Botekos Plus s.r.o.

NOTE 4

The Butibori Unit of the Synthetic Division had been exporting its goods under Rule 18 of the Central Excise Rules 2002 and claiming rebate on both input and output stage of duty. The Central Excise Department disallowed the rebate on Input Stage of duty at Butibori unit. The Synthetic Division has filed a revision petition with the Joint Secretary, Government of India who allowed rebate for both the stages of duty.

However, the Department appealed in the Hon’ble High Court of Mumbai which was upheld by the Hon’ble High Court. The Synthetic Division has now filed a Special Leave Petition before the Hon’ble Supreme Court of India for quashing the Hon’ble High Court Order and allowing the rebate on input stage of duty.

Pending the decision in the matter by the Hon’ble Supreme Court, the Synthetic Division has not yet reversed the rebate receivable on input duty aggregating to Rs.2,31,28,387 (including Rs.28,26,621 at its Pithampur Unit).

Further, relying on the judgment of the Hon’ble High Court of Mumbai for the Butibori unit, a demand has been raised by the Department on the Pithampur unit of the Synthetic Division against the refund already given of the rebate on input stage of duty amounting to Rs. 6,02,16,366/- along with interest. Also, pending claims for the input stage of duty amounting to Rs. 28,26,621/- have been disallowed during 2006-07. The Pithampur unit has gone into appeal against the said demand / disallowance. The Commissioner (Appeals) has rejected the appeal of the Synthetic Division for the pending claim, while the decision has been kept pending against the demand till the final order is received from the higher authority (Revision Authority).

While the management is hopeful of the decision of the case in its favour, it is also reasonably confident of the liquidation / utilization of these cenvat balances of Rs. 8,33,44,753/-

Note 5

The company has an investment of Rs. 20,44,69,921/- in and has amount recoverable amounting to Rs. 47,10,47,260/- from Amit Spinning Industries Limited (ASIL), a subsidiary, as on March 31, 2013. The accumulated losses of ASIL, at the year end exceeded its net worth. There is also reduction in market value of the investment at the year end by Rs. 18,18,10,358. In the opinion of the management, diminution in this long term investment is due to adverse business conditions in the past. ASIL has started generating EBIDTA and cash profits. In view of these developments, management believes that diminution in the value of investment is of temporary nature and that outstanding would be realised within a reasonable period of time. Accordingly no provision considered necessary in the value of investment held and amount due from ASIL.

Note 6

The Company has an investment of Rs. 56,10,11,339 and Rs. 93,23,779 in its subsidiary Spentex Netherlands B. V. (SNBV) and its step down subsidiary Spentex Tashkent Toytepa LLC (STTL) respectively. Further it has Rs. 7,00,12,404 as export receivable from STTL and advances of Rs. 9,50,70,902 in SNBV as on March 31, 2013. The accumulated losses of SNBV and STTL at the year end exceeded their net worth. During the period of investment Government of Uzbekistan changed certain laws and policies by breaching the investment agreement and rendered operation of STTL unviable. Since treaties entered between the Governments of India and Uzbekistan and the Investment agreement entered between Govt. of Uzbekistan and STTL were breached, company has issued notice claiming in excess of USD 100 Mn towards protection of investment and payment of dues & compensation for the losses suffered by the company. Company has since been making all possible efforts to settle the same amicably with the Govt. of Uzbekistan, failing which arbitration proceeding would be initiated by the company to recover its Investment and claims. In view of the legal opinion and claim lodged with the Govt of Uzbekistan, the Directors have decided not to make any provision for diminution in value of investment at this stage.

Note 7

Trade receivables and advance balances include amount aggregating to Rs. 63,71,477/- and Rs. 2,73,14,712/- respectively due from certain parties where payments are not forthcoming. Against the above, the Company has filed a suit for recovery. The Company is making effort to recover the same and expects to reduce them significantly. Based on outcome of the legal suit coupled with further negotiations with these parties, the management is of the opinion that ultimately there would be no losses against these old balances and hence no provision is considered necessary at the stage.

Note 8

As on March 31, 2012, the accumulated losses of the Company had exceeded its net worth. Accordingly company in compliance with the provisions of section 15(1) of Sick Industrial Companies (Special Provisions) Act, 1985 filed a reference with Board for Industrial and Financial Restructuring (BIFR). The Company’s operations were adversely affected in 2011-12 due to adverse Govt policies and high volatility of Raw Material prices. Further, considering the change in scenario, recent performance and trends of the company as well as overall industry outlook, the management believes that losses incurred in the past would reasonably be made good, in due course. The financial statements, as such have been prepared on a going concern basis on the strength of management’s plan of revival including reorganization of business.

Note 9

For the year ended March 31, 2013, the Company has initiated the process of compliance with the transfer pricing regulations for which the prescribed certificate of the accountant will be obtained. The management is of the opinion that the transactions are arms length price. Hence the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and the provision for taxation.

Note 10

The outstanding balance as on 31st March, 2013 in respect of certain trade receivables, trade payables and loans & advances are subject to confirmation/reconciliation and consequential adjustment if any, from the respective parties. The management, however , does not expect any material variations.

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Mar 31, 2012

SUB NOTE:- 1 (a) Above equity share of Rs. 10/- each include :

Pursuant to scheme of arrangement, 82,74,465 Equity Share of Rs. 10/- each fully paid issued to the share holder of erstwhile CLC Corporation Limited during the financial year 2005-06, 1,78,24,591 Equity Share of Rs. 10/- each fully paid issued to the share holder of erstwhile CLC Global Limited during the financial year 2005-06 and 44,87,844 Equity Share of Rs.10/- each fully paid issued to the share holder of erstwhile Indo Rama Textiles Limited during the financial year 2006-07 for consideration other than cash.

SUB NOTE:- 1 (b) The company has only one class of equity share having a par value of Rs. 10/- per share. Each shareholder is eligible for one vote per share. The dividend proposed, if any, by the Board of Directors is subject to the approval of shareholders in the ensuring Annual General Meeting, except in case of interim dividend. 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 of their shareholding.

During the year, out of money received against share warrants , the company has allotted 19,50,000 (previous year 75,89,000) equity shares pursuant to options exercised by the share warrants holder CLC Technologies Private Limited to convert 19,50,000 (previous year 75,89,000) share warrants in equal number of fully paid up equity shares at the agreed price of Rs. 16.95 per equity share (including premium of Rs. 6.95 per equity share).

Nature of Security

Working Capital Loans from Banks are secured by first pari-passu charge on entire current assets, long term loan and advances and other non current assets of the Company. These loans are further secured by second pari-passu charge on entire fixed assets, both present and future and personal guarantee of the promoters. These loans, are also secured by pledge of promoters' shares (18,075,918 nos.) on pari-passu basis.

* Repayable on demand.

The Company had accounted receivable amounting to Rs. 45,24,04,216 due from Schoeller Litvinov k.s (SLKS), a step-down subsidiary of the Company. In the previous year, auditors had qualified the same. Company has accordingly charged off Rs. 31,84,70,394 during the year, and had charged off Rs. 13,39,33,822 during the previous year. Company need to seek the permission from RBI through its authorised dealer for the same. In addition to that the company has given advance of Rs. 18,58,06,138 in the previous year against which a sum of Rs. 16,73,95,417 has been provided during the year considered as doubtful, pending settlement of contractual obligation to various parties. These matters have now been properly reflected in statement of profit & loss as exceptional items.

NOTE 2 : CONTINGENT LIABILITIES :

1 Contingent Liabilities Not Provided for in respect of :

(Amount in Rs.)

Description Year ended Year ended March 31, 2012 March 31, 2011

a) Demands from income tax authorities under appeal 3,79,71,404 6,21,39,030

b) Demands from sales tax authorities under appeal 44,88,038 29,61,560

c) Show cause notices/demands raised by excise / 24,84,32,148 18,08,53,192 customs department (including applicable penalties), not acknowledged as debts

d) Show cause notices/demands raised by MP Government/ 11,78,56,000 11,78,56,000 MPEB department, not acknowledged as debts

e) Claims against the company not acknowledged as debts 31,89,92,331 31,30,151

f) Guarantees and letters of credit issued on behalf of 25,59,38,318 30,09,66,085 the company, outstanding at the year end

g) Bills Discounted with banks on behalf of the company, 67,69,75,025 1,17,58,03,012 outstanding at the year end

h) Corporate Guarantee given to IREDA for loan to 21,18,23,570 24,83,13,698 M/s Himalayan Crest Power Private Limited

i) Corporate Guarantee given to AXIS Bank Ltd.& UCO 35,42,91,492 39,97,99,476 Bank for loan to M/s Amit Spinning Industries Limited

j) Corporate Guarantee given to Tashkent Toytepa Textil for 2,20,01,27,500 1,92,85,17,500 deferred payment of purchase consideration on behalf of Spentex Tashkent Toytepa LLC Current Year USD 43,250,000 (previous year USD 43,250,000)

k) Corporate Guarantee given to CVCI for investment in Spentex 10,17,40,000 8,91,80,000 (Netherlands) B.V.Current Year USD 20,00,000 (previous year USD 20,00,000)

l) Corporate Guarantee given to SBI - Tokyo Branch for loan to 99,67,12,087 87,36,66,050 Spentex (Netherlands) B.V Current Year USD 19,593,318 (previous year USD 19,593,318)*

* The Company believes that the corporate guarantee given to Lehman Brothers is no longer valid as Lehman Brothers did not comply with the terms and conditions of the loan agreement based on which the guarantee was given . Accordingly ,the figure for the current year and previous year do not include the portion of the guarantee relating to the loan from Lehman Brothers.

The amount shown in the items (a) to (e) represent the best possible estimates arrived at on the basis of available information. The uncertainties and possible reimbursements are dependent on outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be predicted accurately. The Company engages reputed professional advisors to protect its interest and has been advised that it has strong legal positions against such disputes. The amount shown in items (f) to (l) represent guarantees given and bills discounted in the normal course of the Company's operations and are not expected to result in any loss to the Company on the basis of beneficiaries fulfilling their ordinary commercial obligations.

NOTE 3 : DEFINED BENEFIT PLAN :

(i) Post Retirement Employee Benefits

(a) Defined Contribution Plans:

The Company has defined contribution plans for post retirement employment benefits' namely Provident Fund and Employee State Insurance Scheme. Expenses for the same is being charged to statement of profit and loss for the year.

(b) Defined Benefit Plans:

The liability for gratuity is determined on the basis of an actuarial valuation, using the Projected Unit Credit (PUC) method at the end of the year. Gains and losses arising out of actuarial valuations are recognised in the statement of profit and loss for the year.

The estimates of future salary increases, considered in actuarial valuations take account of inflation, seniority, promotion and other relevant factors such as supply and demand factors in the employment market.

H. Basis used to determine the Expected Rate of Return on Plan Assets

The expected rate of return on plan assets is based on the current portfolio of assets, investment strategy and market scenario. In order to protect the capital and optimize returns within acceptable risk parameters, the plan assets are well diversified.

NOTE 4 : SEGMENT REPORTING :

In accordance with Accounting Standard - 17 on Segment Reporting issued by the Institute of Chartered Accountants of India, the Company has identified three business segments viz. Textile Manufacturing and Textile Trading. Further, two geographical segments by location of customers have been considered as secondary segments viz, within India and outside India.

NOTES 5 : RELATED PARTY DISCLOSURES :

In accordance with the requirements of Accounting Standard (AS) - 18 on Related Party Disclosures, the names of the related parties where control exists and/or with whom transactions have taken place during the year and description of relationships, as identified and certified by the management, are :

Enterprises Under Significant Influence:

i) Himalayan Crest Power Pvt. Limited

ii) CLC & Sons (Pvt.) Limited

iii) CLC Technologies Private Limited

Key Management Personnel

i) Mr. Ajay Kumar Choudhary Chairman & Whole time Director

ii) Mr. Mukund Choudhary Managing Director

iii) Mr. Kapil Choudhary Deputy Managing Director

iv) Mr. Amrit Agrawal Director - Finance

v) Mr. Sitaram Parthasarathy Director - Works Subsidiaries / Step-down Subsidiaries

i) M/s Amit Spinning Industries Limited

ii) M/s Spentex Tashkent Toytepa LLC

iii) M/s Spentex Netherlands B.V

iv) M/s Spentex (Mauritius) P Ltd***

v) M/s Spentex ( Cyprus ) P Ltd***

vi) M/s. Schoeller Litvinov k.s.

vii) M/s. Schoeller Textile Netherlands B.V.

viii) M/s. Schoeller Textile Verwaltungs GMBH***

ix) M/s. Schoeller Textile GMBH & Co. KG***

NOTE 6

The Butibori Unit of the Synthetic Division had been exporting its goods under Rule 18 of the Central Excise Rules 2002 and claiming rebate on both input and output stage of duty. The Central Excise Department disallowed the rebate on Input Stage of duty at Butibori unit. The Synthetic Division has filed a revision petition with the Joint Secretary, Government of India who allowed rebate for both the stages of duty.

However, the Department appealed in the Hon'ble High Court of Mumbai which was upheld by the Hon'ble High Court. The Synthetic Division has now filed a Special Leave Petition before the Hon'ble Supreme Court of India for quashing the Hon'ble High Court Order and allowing the rebate on input stage of duty.

Pending the decision in the matter by the Hon'ble Supreme Court, the Synthetic Division has not yet reversed the rebate receivable on input duty aggregating to Rs. 5,28,79,724 (including Rs. 28,26,621 at its Pithampur Unit ).

Further, relying on the judgment of the Hon'ble High Court of Mumbai for the Butibori unit, a demand has been raised by the Department on the Pithampur unit of the Synthetic Division against the refund already given of the rebate on input stage of duty amounting to Rs. 6,02,16,366 along with interest. Also, pending claims for the input stage of duty amounting to Rs. 28,26,621 have been disallowed during 2006-07. The Pithampur unit has gone into appeal against the said demand / disallowance. The Commissioner (Appeals) has rejected the appeal of the Synthetic Division for the pending claim, while the decision has been kept pending against the demand till the final order is received from the higher authority (Revision Authority).

While the management is hopeful of the decision of the case in its favour, it is also reasonably confident of the liquidation / utilization of these cenvat balances of Rs. 11,30,96,090.

Note 7

The company has an investment of Rs. 20,44,69,921/- in Amit Spinning Industries Limited (ASIL), being a subsidiary of the Company. It also advanced a loan including interest accrued thereon amounting to Rs. 41,60,78,601/- as on March 31, 2012. The accumulated losses of ASIL, at the year end March 31, 2012 exceeded its net worth. There is also reduction in market value of the investment as on that date by Rs. 16,85,92,279/-. In the opinion of the management, diminution in this long term investment is due to adverse business conditions in the past. ASIL, as of now has started generating EBIDTA and Cash Profits. In view of these developments, management believes that diminution in the value of investment is of temporary nature and that the outstanding would be realized within a reasonable period of time. Accordingly no provision is considered necessary in the value of investment held and loan advanced to ASIL

Note:- The company has not recognized above Deferred Tax asset on account of prudence.

Note 8

The Company has an investment of Rs. 56,10,11,339/- and Rs. 93,23,779/- in its subsidiary Spentex (Netherlands) B. V. (SNBV) and its step down subsidiary Spentex Tashkent Toytepa LLC (STTL) respectively. Further it has Rs. 7,00,12,404/- as export receivable from STTL and advances of Rs. 9,50,70,902/- in SNBV as on March 31, 2012. During the period of investment, the Government of Uzbekistan changed certain laws and policies by breaching the investment agreement and rendered operation of STTL unviable. Consequently STTL could not pay its debts and insolvency proceedings have been initiated against it. Since treaties entered between the Governments of India and Uzbekistan and the Investment agreement entered between Govt. of Uzbekistan and Spentex were breached, company has issued notice claiming protection of investment and payment of dues & compensation for the losses suffered by company. In view of legal opinion placed before the board and claims lodged with the Government of Uzbekistan, the Directors have decided not to make any provision for diminution in value of investment at this stage.

Note 9

As on March 31, 2012, the accumulated losses of the Company have exceeded its net worth. Accordingly company in compliance with the provisions of section 23(1) of Sick Industrial Companies (Special Provisions) Act, 1985 will file a reference with Board for Industrial and Financial Restructuring (BIFR). However, in the opinion of the management, the Company's operations have been adversely affected a) due to ban on yarn export by the government resulting in the piling up of Yarn inventory and its offloading at reduced prices during current year and b) very high volatility in Raw Material prices. Further, considering the change in scenario, recent performance and trends of the company as well as overall industry outlook, there is an increase in average selling prices of the yarn, stability in production levels and reduction in procurement costs of raw materials. Resultantly, the company has started earning net profits and the management believes that losses incurred in the past would reasonably be made good, in due course. The financial statements, as such have been prepared on a going concern basis on the strength of management's plan of revival including reorganization of business and restructuring of loan facilities under Corporate Debt Restructuring scheme.

Note 10

The financial statements for the year ended 31st March, 2011 had been prepared as per the then applicable, pre-revised Schedule VI to the Companies Act, 1956. Consequent to the notification under the Companies Act, 1956, the financial statements for the year ended 31st March, 2012 are prepared under revised Schedule VI. Accordingly, the previous year figure have also been reclassified to conform to this year's classification.

Note 11

The outstanding balance as on 31st March, 2012 in respect of certain trade receivables, trade payables and loans & advances are subject to confirmation/reconciliation and consequential adjustment if any from the respective parties. The management, however , does not expect any material variations.

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Mar 31, 2011

1 Contingent Liabilities not provided for in respect of : (Amount in Rs.)

Description This Year Previous Year

a) Demands from Income Tax Authorities under appeal 62,139,030 62,139,030

b) Demands from Sales Tax Authorities under appeal 2,961,560 3,265,040

c) Show cause notices/demands raised by Excise / Customs Department 180,853,192 179,856,196 (including applicable penalties), not acknowledged as debts

d) Show cause notices/demands raised by MP Government / 117,856,000 117,856,000 MPEB Department, not acknowledged as debts

e) Claims against the Company not acknowledged as debts 3,130,151 3,130,151

f) Guarantees and Letters of credit issued on behalf of the Company, 300,966,085 248,797,962 outstanding at the year end

g) Bills Discounted with Banks on behalf of the Company, outstanding 1,175,803,012 832,402,925 at the year end

h) Corporate Guarantee given to IREDA for Loan to M/s Himalayan 248,313,698 268,306,862 Crest Power Limited

i) Corporate Guarantee given to AXIS Bank Ltd.& UCO Bank for Loan 399,799,476 428,568,149 to M/s Amit Spinning Industries Limited

j) Corporate Guarantee given to Tashkent Toytepa Textil for deferred payment 1,928,517,500 2,007,040,000 of purchase consideration on behalf of Spentex Tashkent Toytepa LLC Current Year USD 43,250,000 (Previous Year USD 44,800,000)

k) Corporate Guarantee given to CVCI for investment in Spentex (Netherlands) 89,180,000 89,600,000 B.V.Current Year USD 20,00,000 (Previous Year USD 20,00,000)

l) Corporate Guarantee given to SBI - Tokyo Branch for loan to Spentex 873,666,050 978,840,666

(Netherlands) B.V Current Year USD 19,593,318 (Previous Year USD 21,849,122)

* The Company belived that the corporate guarantee given to Lehman Brothers is no longer valid as Lehman Brothers did not comply with the terms and conditions of the loan agreement based on which the guarantee was given . Accordingly ,the figure for the current year and previous year do not include the portion of the guarantee relating to the loan from Lehman Brothers.

The amount shown in the items (a) to (e) represent the best possible estimates arrived at on the basis of available information. The uncertainties and possible reimbursements are dependent on outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be predicted accurately. The Company engages reputed professional advisors to protect its interest and has been advised that it has strong legal positions against such disputes. The amount shown in items (f) to (l) represent guarantees given and bills discounted in the normal course of the Company’s operations and are not expected to result in any loss to the Company on the basis of beneficiaries fulfilling their ordinary commercial obligations

4 In accordance with the current industry practice, plant and machinery of the Company has been treated as “Continuous Process Plant” as defined under Schedule XIV to the Companies Act,1956.

5 During the year, out of the Share Warrants money received, the Company has allotted 7,589,000 equity shares pursuant to option exercised by the share warrant holder to convert 7,589,000 share warrants in equal number of fully paid up equity shares and the balance consideration of 75% amounting to Rs. 96,475,163 has been received on 7,589,000 warrants at the time of conversion into equity shares at the agreed price of Rs. 16.95 per equity share (including premium of Rs. 6.95 per equity share).

6 Carrying value of Temple Land and Building at Pitampur unit amounting Rs. 183.66 Lacs has been restored back in books of account, as the Company is having possession and control of this Temple since acquisition.

7 The Butibori Unit of the Synthetic Division had been exporting its goods under Rule 18 of the Central Excise Rules 2002 and claiming rebate on both input and output stage of duty. The Central Excise Department disallowed the rebate on Input Stage of duty at Butibori unit. The Synthetic Division has filed a revision petition with the Joint Secretary, Government of India who allowed rebate for both the stages of duty

However, the Department appealed in the Hon’ble High Court of Mumbai which was upheld by the Hon’ble High Court. The Synthetic Division has now filed a Special Leave Petition before the Hon’ble Supreme Court of India for quashing the Hon’ble High Court Order and allowing the rebate on input stage of duty.

Pending the decision in the matter by the Hon’ble Supreme Court, the Synthetic Division has not yet reversed the rebate receivable on input duty aggregating to Rs 52,879,724 (including Rs 2,826,621 at its Pithampur Unit).

Further, relying on the judgment of the Hon’ble High Court of Mumbai for the Butibori unit, a demand has been raised by the Department on the Pithampur unit of the Synthetic Division against the refund already given of the rebate on input stage of duty amounting to Rs 60,216,366 along with interest. Also, pending claims for the input stage of duty amounting to Rs 2,826,621 have been disallowed during 2006-07. The Pithampur unit has gone into appeal against the said demand / disallowance. The Commissioner (Appeals) has rejected the appeal of the Synthetic Division for the pending claim, while the decision has been kept pending against the demand till the final order is received from the higher authority (Revision Authority).

While the management is hopeful of the decision of the case in its favour, it is also reasonably confident of the liquidation / utilization of these cenvat balances of Rs. 113,096,090.

8 (a) The company has an investment of Rs 204,469,921 in and has advance loan including interest accrued amounting to Rs. 383,067,401 Amit Spinning Industries Limited (ASIL), a subsidiary, as on March 31, 2011. The accumulated losses of ASIL, at the year end exceeded its net worth. There is also reduction in market value of the investment at the year end by Rs. 130,406,719. In the opinion of the management, diminution in this long term investment is due to adverse business conditions in the past. ASIL has started generating EBIDTA and cash profits. In view of these developments, management believes that diminution in the value of investment is of temporary nature. Further ASIL has refunded amount of Rs. 156,095,401 during the year and for remaining balances,management believes that the balance amount would be realised within a reasonable period of time. Accordingly no provision considered necessary in the value of investment held and loan advanced to ASIL

(b) Schoeller Litvinov k.s. (SLKS), the Czech step-down subsidiary of the Company, had registered losses during the year and earlier financial years due to economic slowdown. This step down subsidiary had submitted a re-organization plan seeking deferment of payment to Secured creditors, and proportionate waiver of unsecured liabilities which has now been approved by the court. The Company believes that the reorganization plan, considering improvement in the global textile market, will turn around this subsidiary, so as to make good its losses in a foreseeable period of time and will also place this subsidiary in a position to repay the liabilities in due course. Accounts and other receivables Rs. 327,965,283 (Previous Year 468,986,120) is due from SLKS as at March 31, 2011. Accordingly, provision against these Accounts and other receivables is not considered necessary at this stage.

10 The Finance Act, 2001 has introduced, with effect from assessment year 2002-03 (effective April 1, 2001), detailed Transfer Pricing regulation for computing the taxable income from ‘international transactions’ between ‘associated enterprises’ on an ‘arm’s length’ basis These regulations, inter alia, also require the maintenance of prescribed documents and information including furnishing a report from an Accountant within the due date of filing of Return of Income. For the year ended March 31, 2011, the Company has initiated the process of compliance with the said transfer pricing regulations for which the prescribed certificate of the accountant will be obtained and the Company does not envisage any tax liability.

16. Employee Benefits

(i) Post Retirement Employee Benefits

(a) Defined Contribution Plans:

The Company has Defined Contribution plans for post retirement employment benefits’ namely Provident Fund and Employee State Insurance Scheme. Expense for the same is being charged to Profit and Loss account for the year.

(b) Defined Benefit Plans:

The liability for gratuity is determined on the basis of an actuarial valuation at the end of the year. Gains and losses arising out of actuarial valuations are recognised in the Profit and Loss Account for the year.

(ii) Other employee benefits

Other employee benefits are accounted for on accrual basis. Liabilities for Compensated absences which is a defined benefit plan are determined based on independent year end actuarial valuation and the resulting charge is being accounted in Profit and Loss Account.

17 Related Party Disclosures :

A) In accordance with the requirements of Accounting Standard (AS) - 18 on Related Party Disclosures, the names of the related parties where control exists and/or with whom transactions have taken place during the year and description of relationships, as identified and certified by the management, are :

i) Enterprises under significant influence:

a) Himalayan Crest Power Private Limited.

b) CLC & Sons (P) Limited

c) CLC Technologies Private Limited

ii) Key Management Personnel

a) Mr. Ajay Kumar Choudhary Chairman & Whole time Director

b) Mr. Mukund Choudhary Managing Director

c) Mr. Kapil Choudhary Deputy Managing Director

d) Mr. Amrit Agrawal Director - Finance

e) Mr. Sitaram Parthasarathy Director - Works

iii) Subsidiaries / Step-down subsidiaries

a) M/s Amit Spinning Industries Limited

b) M/s Spentex Tashkent Toytepa LLC

c) M/s Spentex Netherlands B.V

d) M/s Spentex Mauritius P Ltd

e) M/s Spentex ( Cyprus ) P Ltd

f) M/s. Schoeller Litvinov k.s.

g) M/s. Schoeller Textile Netherlands B.V. h) M/s. Schoeller Textile Verwaltungs GMBH i) M/s. Schoeller Textile GMBH & Co. KG

j) M/s. Botekos Plus s.r.o.

20. Previous years figures have been regrouped / recasted wherever necessary to confirm to current years classification.

---

Mar 31, 2010

1 Contingent Liabilities not provided for in respect of : (Amount in )

Description This Year Previous Year

a) Demands from Income Tax Authorities under appeal 62,139,030 62,139,030

b) Demands from Sales Tax Authorities under appeal 3,265,040 20,102,976

c) Show cause notices/demands raised by Excise / Customs Department 179,856,196 277,080,377 (including applicable penalties), not acknowledged as debts

d) Show cause notices/demands raised by MP Government / 117,856,000 117,856,000 MPEB Department , not acknowledged as debts

e) Claims against the Company not acknowledged as debts 3,130,151 13,298,670

f) Guarantees and Letters of credit issued on behalf of the Company, 248,797,962 271,958,521 outstanding at the year end

g) Bills Discounted with Banks on behalf of the Company, outstanding 832,402,925 642,380,891 at the year end

h) Corporate Guarantee given to IREDA for Loan to M/s Himalayan 268,306,862 266,222,000 Crest Power Limited

i) Corporate Guarantee given to AXIS Bank Ltd.& UCO Bank for 428,568,149 419,201,873 Loan to M/s Amit Spinning Industries Limited

j) Corporate Guarantee given to Tashkent Toytepa Textil for deferred payment 2,007,040,000 2,457,216,000 of purchase consideration on behalf of Spentex Tashkent Toytepa LLC Current Year USD 44,800,000 (Previous Year USD 48,600,000)

k) Corporate Guarantee given to CVCI for investment in Spentex (Netherlands) 89,600,000 101,120,000 B.VCurrent Year USD 20,00,000 (Previous Year USD 20,00,000)

l) Corporate Guarantee given to SBI - Tokyo Branch for loan to Spentex 978,840,666 1,094,659,594

(Netherlands) B.V Current Year USD 21,849,122 (Previous Year USD 21,650,704)*



* The Company has been legally advised that the corporate guarantee given to Lehman Brothers is no longer valid as Lehman Brothers did not comply with the terms and conditions of the loan agreement based on which the guarantee was given . Accordingly ,the figure for the current year and previous year do not include the portion of the guarantee relating to the loan from Lehman Brothers.

The amount shown in the items (a) to (e) represent the best possible estimates arrived at on the basis of available information. The uncertainties and possible reimbursements are dependent on outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be predicted accurately. The Company engages reputed professional advisors to protect its interest and has been advised that it has strong legal positions against such disputes. The amount shown in items (f) to (l) represent guarantees given and bills discounted in the normal course of the Company’s operations and are not expected to result in any loss to the Company on the basis of beneficiaries fulfilling their ordinary commercial obligations

2 In accordance with the current industry practice, plant and machinery of the Company has been treated as “Continuous Process Plant” as defined under Schedule XIV to the Companies Act,1956.

3 Pursuant to special resolution passed by the Members of the Company in their Extra-ordinary General Meeting held on 27th November, 2009, the Company has issued 11,800,000 share warrants on a preferential basis to CLC Technologies Private Limited, promoters group company, each convertible into one equity share at share subscription price of Rs. 16.95 per warrant. The Company has received an advance of 25% of share subscription price amounting to Rs. 50,002,500, as per the guidelines issued by Securities and Exchange Board of India under Securities and Exchange Board of India (Issue Of Capital And Disclosure Requirements) Regulations, 2009 for Preferential Allotment Out of the above, the Company has allotted 2,261,000 equity shares on 31st March, 2010 pursuant to option exercised by the share warrant holder to convert 2,261,000 share warrants in equal number of fully paid up equity shares and the balance consideration of 75% amounting to Rs. 28,742,963 has been received on 2,261,000 warrants at the time of conversion into equity shares at the agreed price of Rs. 16.95 per equity share (including premium of Rs. 6.95 per equity share).

4 In the current year, the Company has changed its method of valuing raw materials at Synthetic division from the Weighted Average method to the Specific identification of cost method based on peculiarities of condition existing in the business and prevalent industry practices. The Specific identification of cost method results in a better presentation of the carrying value of raw material inventory in the financial statements.

Had the Company continued to use the earlier basis of valuing Raw Materials, closing stock of Raw Materials would have been lower by Rs. 43,27,747 with consequential impact on net current assets and loss for the year.

5 The Butibori Unit of the Synthetic Division had been exporting its goods under Rule 18 of the Central Excise Rules 2002 and claiming rebate on both input and output stage of duty. The Central Excise Department disallowed the rebate on Input Stage of duty at Butibori unit. The Synthetic Division has filed a revision petition with the Joint Secretary, Government of India who allowed rebate for both the stages of duty

However, the Department appealed in the Hon-ble High Court of Mumbai which was upheld by the Honble High Court. TheSynthetic Division has now filed a Special Leave Petition before the Hon’ble Supreme Court of India for quashing the HonbleHigh Court Order and allowing the rebate on input stage of duty.

Pending the decision in the matter by the Honble Supreme Court, the Synthetic Division has not yet reversed the rebatereceivable on input duty aggregating to Rs 52,879,724 (including Rs 2,826,621 at its Pithampur Unit).

Further, relying on the judgment of the Hon’ble High Court of Mumbai for the Butibori unit, a demand has been raised by theDepartment on the Pithampur unit of the Synthetic Division against the refund already given of the rebate on input stage of dutyamounting to Rs 60,216,366 along with interest. Also, pending claims for the input stage of duty amounting to Rs 2,826,621have been disallowed during 2006-07. The Pithampur unit has gone into appeal against the said demand / disallowance. TheCommissioner (Appeals) has rejected the appeal of the Synthetic Division for the pending claim, while the decision has beenkept pending against the demand till the final order is received from the higher authority (Revision Authority).

While the company is hopeful of the decision of the case in its favour, it is also reasonably confident of the liquidation / utilizationof these cenvat balances of Rs. 113,096,090.

6 During the year company has charged Rs 14,304,599 to Amit Spinning Industries Limited, (Previous Year Rs 22,904,102 to Amit Spinning Industries Limited and Schoeller Litvinov, k.s). in respect of expenses borne by it which are allocable to these subsidiaries. These amounts have been offset against the respective expense heads

7 (a) The Company has an investment of Rs 204,469,921 in Amit Spinning Industries Limited (ASIL), a subsidiary, as on March 31, 2010, The accumulated losses in ASIL, at the year end exceeded its net worth. There is also a reduction in market value of these investments as at the year end by Rs.162,297,956 (Previous Year Rs. 171,949,252). In the opinion of the management, the above diminution in this long term investment is due to adverse business conditions and is not ultimately expected to continue in future. Based on recent performance and trends of ASIL and overall industry outlook, there is an increase in average selling prices of yarn, consistent increase in production level and reduction in procurement costs of raw materials. Consequent to such developments, ASIL has started generating EBIDTA and cash profits.In view of these developments, management believes in future financial viability of this subsidiary and accordingly, provision for the diminution in the value of this long term investment is not considered necessary at this stage.

Regarding the loans, advances, and interest due on the loan amounting to Rs. 440,528,019, Rs. 17,726,208, and Rs.60,414,121 respectively, amount Rs.170,400,000 related to Loan has been subsequently received and for remaining balances, management believes that the such amounts would be realized within a reasonable period of time . Accordingly, no provision is considered necessary at this stage.

8 (b) SchoellerLitvinov k.s. (SLKS), the Czech step-down subsidiary of the Company, had registered losses during the year and earlier financial years due to economic slowdown. This step down subsidiary had submitted a re-organization plan seeking deferment of payment to Secured creditors, and proportionate waiver of unsecured liabilities which has now been approved by the court. The Company believes that the reorganization plan, considering improvement in the global textile market, will turn around this subsidiary, so as to make good its losses in a foreseeable period of time and will also place this subsidiary in a position to repay the liabilities in due course. Accounts and other receivables Rs. 468,986,120 is due from SLKS as at March 31, 2010. Accordingly, provision against these Accounts and other receivables is not considered necessary at this stage.

9 Sundry Debtors and Advances include amounts aggregating Rs. 17,408,913 and Rs. 22,473,335 espectively due from certain customers where payments are not forthcoming. Of the above, the Company has filed a suit for recovery of Rs. 17,408,913 against two of the customers. Further, in respect of the advances of Rs. 22,473,335 the Company is making efforts to recover the same and expects to reduce them significantly. Based on outcome of the legal suit coupled with further negotiations with these parties, the management is of the opinion that ultimately there would be no losses against these old balances and hence no provision is considered necessary at this stage

10 Pursuant to compliance of clause 32 of the Listing Agreement, on disclosure of Loans / Advances in the nature of loans, the relevant information is provided hereunder:

Note :

1 There are no repayment schedule for the loans and advances to subsidiary as mentioned above.

2 Loans to employees as per Company’s policy are not considered.

11 The Finance Act, 2001 has introduced, with effect from assessment year 2002-03 (effective April 1, 2001), detailed Transfer Pricing regulation for computing the taxable income from ‘international transactions’ between ‘associated enterprises’ on an ‘arm’s length’ basis These regulations, inter alia, also require the maintenance of prescribed documents and information including furnishing a report from an Accountant within the due date of filing of Return of Income. For the year ended March 31, 2010, the Company has initiated the process of compliance with the said transfer pricing regulations for which the prescribed certificate of the accountant will be obtained and the Company does not envisage any tax liability.

** Included in legal & professional expenses under schedule XVII Manufacturing and other costs.

Foot Note:

The contribution to Gratuity Fund and leave encashment have been made on group basis and separate figures applicable to an individual employee are not available and have, therefore, not been taken into account in the above computation.

12. Taxation

Deferred Tax

Note : The company has not recognized above Deferred Tax Asset on account of prudence.

13. Earnings Per Share (EPS):

* There are no potential dilutive securities

14. Employee Benefits

(i) Post Retirement Employee Benefits

(a) Defined Contribution Plans:

The Company has Defined Contribution plans for post retirement employment benefits’ namely Provident Fund and Employee State Insurance Scheme. Expense for the same is being charged to Profit and Loss account for the year.

(b) Defined Benefit Plans:

The liability for gratuity is determined on the basis of an actuarial valuation at the end of the year. Gains and losses arising out of actuarial valuations are recognised in the Profit and Loss Account for the year.

(ii) Other employee benefits

Other employee benefits are accounted for on accrual basis. Liabilities for Compensated absences which is a defined benefit plan are determined based on independent year end actuarial valuation and the resulting charge is being accounted in Profit and Loss Account.

The estimates of future salary increases, considered in actuarial valuations take account of inflation, seniority, promotion and other relevant factors such as supply and demand factors in the employment market.

G. Basis used to determine the Expected Rate of Return on Plan Assets

The expected rate of return on plan assets is based on the current portfolio of assets, investment strategy and market scenario. In order to protect the capital and optimize returns within acceptable risk parameters, the plan assets are well diversified.

15. Related Party Disclosures

A) In accordance with the requirements of Accounting Standard (AS) - 18 on Related Party Disclosures, the names of the related parties where control exists and/or with whom transactions have taken place during the year and description of relationships, as identified and certified by the management, are :

i) Enterprises under significant influence:

a) Himalayan Crest Power Limited.

b) CLC & Sons (P) Limited

c) CLC Technologies Private Limited

ii) Key Management Personnel

a) Mr. Ajay Kumar Choudhary Chairman & Whole time Director

b) Mr. Mukund Choudhary Managing Director

c) Mr. Kapil Choudhary Deputy Managing Director

d) Mr. Amrit Agrawal Director - Finance

e) Mr. Sitaram Parthasarathy Director - Works

iii) Subsidiaries / Step-down subsidiaries

a) M/s Amit Spinning Industries Limited

b) M/s Spentex Tashkent Toytepa LLC

c) M/s Spentex Netherlands B.V

d) M/s Spentex Mauritius P Ltd

e) M/s Spentex ( Cyprus ) P Ltd

f) M/s. Schoeller Litvinov k.s.

g) M/s. Schoeller Textile Netherlands B.V. h) M/s. Schoeller Textil Verwaltungs GMBH i) M/s. Schoeller Textil GMBH & Co. KG

j) M/s. Botekos Plus s.r.o.

16. Segment Disclosure

In accordance with Accounting Standard - 17 on Segment Reporting issued by the Institute of Chartered Accountants of India, the Company has identified three business segments viz. Textile Manufacturing, Textile Trading and Other Trading. Further, two geographical segments by location of customers have been considered as secondary segments viz, Within India and Outside India .The segment wise disclosure are as follows :

* Purchase of yarn include 2,031,655 Kgs (Previous Year 1,101,473 Kgs) amounting to Rs 272,314,277 (Previous year Rs 128,012,463) on account of inter unit transfer

# The above sales figures do not include the export incentives - Duty Drawback of Rs 24,259 (Previous Year Rs 14,961,279) (figures in brackets are for the previous year.)

* Sale of Yarn Includes 2,031,655 Kgs (Previous Year 1,101,473 Kgs), amouting to Rs 272,314,277 ( Previous Year Rs 128,012,463) on account of Inter Unit Transfer

# The above sales figures do not include the export incentives - Duty Drawback of Rs 23,933,554 (Previous Year Rs. 191,257,562)

$ The above sales is inclusive of excise duty paid on Synthetic yarn sale amounting to Rs 36,443,713 ( Previous Year Rs 28,463,668)

@ # Above figures includes Opening stock of trial production of Nil ( Previous year 454,570 Kgs ) amounting to Rs Nil

(Previous year 45,780,423), Current year production Nil (Previous year 301,633 Kg), sales of trial production of Nil

(Previous year 756,203 Kgs) amounting to Rs. Nil (Previous year Rs 78,107,442). (figures in brackets are for the previous year.)

* It is not practicable to furnish quantitative information of other raw materials and components consumed in view of the large number of items which differ in size and nature, each being less than 10% in value of the total

17. Previous years figures have been regrouped / recasted wherever necessary to conform to current years classification.