Modern Insulators Ltd. के अकाउंट के लिये नोट

Mar 31, 2025

(d) Provisions and contingencies

The assessments undertaken in recognizing provisions and
contingencies have been made in accordance with Ind AS 37,
‘Provisions, Contingent Liabilities and Contingent Assets’. The
evaluation of the likelihood of the contingent events requires best
judgment by the management regarding the probability of exposure
to potential loss. If circumstances change following unforeseeable
developments, this likelihood could alter.

(e) Impairment of non-financial assets

The company has used certain judgments and estimation to estimate
future projection and discount rate to compute value in used of
assets/cash generating units and to assess impairment.

(f) Revenue recognition

The company recognised the revenue from contract with customers
based on 5 steps model as per Ind AS- 115 which involve judgments
relating to identification of contracts with customers, identification
of distinct performance obligation, determination of transaction
price with respect to identified performance obligation,
appropriateness of the basis used to recognise revenue and when
the control of goods and services are being transferred.

iv) a) Provision for taxation including interest to the extent of estimated at ? 1915.17 lacs for the year ended 31st March, 2025 (31st March, 2024¬
? 2209.77 Lacs; upto the year ? 11844.19lacs) has not been made in accounts in view of the proposed amalgamation under the provisions of
Companies Act, 2013.

b) Company has claimed the losses pertaining to Modern Denim Limited in its income tax return from AY 2017-18, with which the company has
proposed amalgamation. Income Tax Department has completed assessment for Assessment Year 2017-18 and 2018-19 and has disallowed
such losses claimed pursuant to proposed amalgamation pending approval from concerned authorities. However, the Company has filed appeal
against the said order before CIT (Appeals).CIT(A) in his order has held that effect of the scheme of amalgamation will be allowed by the AO
as and when the scheme is approved by the competent authority.

- Investment Risk - If Plan is funded then assets liabilities mismatch & actual investment return on assets lower than the discount rate assumed at the
last valuation date can affect the liability.

- Discount Rate : Reduction in discount rate in subsequent valuations can increase the plan’s liability.

- Mortality & disability - Actual deaths & disability cases proving lower or higher than assumed in the valuation can affect the liabilities.

- Withdrawals - Actual withdrawals proving higher or lower than assumed withdrawals and change of withdrawal rates at subsequent valuations can
affect liability.

iv) Long term employee benefit
Leave encashment

The company has a policy to pay leave encashment. Every employee is entitled to claim leave encashment after his/her retirement/termination which is
calculated based upon no. of leaves earned. The company has a total provision for leave encashment as on 31st March, 2025- ? 412.45 Lacs and as on
31st March, 2024- ? 400.09 Lacs. Total expenses provided during the year 2024-25 is ? 122.98 Lacs and for the year 2023-24 ? 103.05 Lacs. Current
Service Cost of? 56.07 Lacs for the year 2024-25 and ? 53.49 Lacs for the year 2023-24 based on actuarial valuation.

Note No. 37 : OPERATIVE SEGMENT INFORMATION AS PER INDAS-108
A. Primary segment reporting (by business segment)

The two identified segments are:

(i) Insulators

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Note No. 40 : CAPITAL COMMITMENTS

Estimated amount of contracts remaining to be executed on capital account and not provided for ? 27.69 Lacs (net of advances ? 19.44 Lacs) 31st
March, 2024- ? 923.23 Lacs. (net of advances ? 645.29 Lacs)

Note No. 41 : CAPITAL MANAGEMENT

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

The Company manages its capital so as to safeguard its ability to continue as a going concern and to optimise returns to shareholder. The capital
structure of the Company is based on management’s judgement of its strategic and day-to-day needs with a focus on total equity so as to maintain
investors, creditors and market confidence. The management and the Board of Directors monitors the return on capital. The Company may take
appropriate steps in order to maintain, or if necessary adjust, its capital structure.

Note No. 42 : FINANCIAL RISK MANAGEMENT

The Company’s Financial Risk Management is an integral part of how to plan and execute its business strategies. The Company’s financial risk
management is set by the Managing Board. The Company’s principal financial liabilities comprise loans and borrowings, trade payables and other
payables. The main purpose of these financial liabilities is to finance the company’s operations. The company’s principal financial assets include trade
& other receivables, investments, cash and short term deposits.

i) Credit risk

Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. To manage this, the Company periodically
assesses the financial reliability of customers and other counter parties, taking into account financial conditions, current economic trends and analysis
of historical bad debts and ageing of financial assets. Individual risk limits are set and periodically reviewed based on such information.

Financial assets are written off when there are no reasonable expectations of recovery, such as a debtor failing to engage in a repayment plan with the
Company. Where loans or receivables have been written off, the Company continues to engage in enforcement activity to attempt to recover the
receivable due. Where recoveries are made, these are recognized as income in the statement of profit and loss.

The Company measures the expected credit loss of trade receivables based on historical trend and the business environment in which the entity operates.
Loss rates are based on actual credit loss experience and past trends. The Company provides loss allowance on trade receivables using life time expected

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iii) Market Risk

Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in the price of a financial instrument. The
value of a financial instrument may change as a result of changes in the interest rates, foreign currency exchange rates, equity prices and other market
changes that affect market risk sensitive instruments. Market risk is attributable to all market risk sensitive financial instruments including investments
and deposits, foreign currency receivables, payables and loans and borrowings.

a) Foreign currency risk

The company operates internationally and portion of the business is transacted in several currencies and consequently the company is exposed to foreign
exchange risk through its sales in overseas and purchase from overseas suppliers in various foreign currencies.

The company evaluate exchange rate exposure arising from foreign currency transaction and the company follow established risk management policies,
including the use of derivative like foreign exchange forward contracts to hedge exposure to foreign risk.

Note No 43. DISCLOSURE AS PER IND AS-27, SEPARATE FINANCIAL STATEMENT

The company had entered into Joint Venture Agreement with Shriji Designs by incorporating new JV firm M/s Shriji Designs -MIL (JV) to participate
in railways EPC tenders. The JV had been awarded tender for design, supply, erection, testing and commissioning of 25 KV OHE between sanwad-
nimarkhedi NTPC siding of western railway. As per the joint venture working agreement entered with Shriji Designs, execution is entirely in the scope
of MIL and company has to pay 2% fees to JV partner. Accordingly 100% profit/loss of JV is part of the company.

The company had entered into Joint Venture Agreement with Sikka Engineering Company by incorporating new JV firm M/s SEC-MIL (JV) to
participate in railways EPC tenders. As per the joint venture working agreement entered with Sikka Engineering execution of contract , if any awarded
to JV firm will be entirely in the scope of MIL and company will pay 2.25% commission of contract value to JV partner.

The company had also entered into Joint Venture Agreement with Akhandalamani Electricals & Construction by incorporating JV firm M/s Modern
Insulators JV Akhandalamani Electrical & Construction to participate in discom tenders. As per the joint venture working agreement entered with
Akhandalamani Electricals & Construction execution of contract , if any awarded to JV firm will be entirely in the scope of MIL and company will pay
1.50% commission of contract value to JV partner.

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

(vi) The company has not received any fund from any other person(s) or entity(ies) including foreign entities (funding party) with the understanding (whether
recorded in writing or otherwise) that the company shall:

a. directly or indirectly lend to or invest in other persons or entities identified in any manner whatsoever by or on behalf of funding party (Ultimate
beneficiaries) or

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

(vii) The company has no such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in
the tax assessments under the Income Tax Act,1961 such as ,search or survey or any other relevant provisions of the Income Tax Act,1961.

(viii) The Company has not been declared as willful defaulter by any bank or financial institution or other lenders in accordance with the guidelines issued by
Reserve Bank of India.

Note No. 52: The Company has a process whereby periodically all long term contracts (including derivative contract) are assessed for material foreseeable
losses. At the year end, the Company has reviewed and ensured that adequate provision as required under any law/accounting standards for material foreseeable
losses on such long term contracts (including derivative contracts) has been made in the books of accounts.

Note No. 53: The Company has used such accounting software for maintaining its books of accounts for the year ended 31 March 2025, which has a feature of
recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software and has not been
tampered with at any time during the year and the audit trail have been preserved by the company as the statutory requirements, except one unit (separate
segment) of the company where accounting software used for maintaining books of accounts for the year ended 31^st March 2025 does not have a feature of
recording audit trail (edit log) facility.

Note No 54: The Financials Statements were approved for issue by the directors on 28th May, 2025.

Note No 55: Figures for previous years have been regrouped/rearranged/restated wherever considered necessary to make them comparable with the figures for
the current year.

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

_{F R r V} & _A • _t Sachin Ranka -Chairman & Managing Director (DIN : 00335534)

Fo^r R ^R ™ & ^Af^sociates Shreyans Ranka - Whole Time Director (DIN : 06470710)

Chartered ^Acc°unta^nts p Sridharan -Whole Time Director (DIN : 03100055)

^{Firm Registratlon No}- ^012650C Animesh Banerjee -Whole Time Director (DIN : 07905214)

R_aj_esh V_erma S.K. Sharma -Independent Director (DIN : 01378040)

P_art_ner Rahul Singhvi - Independent Director (DIN : 08816920)

M_emb_ership N_o 404029 G.V. Kalpathy -Independent Director (DIN : 10512773)

Meena Alok Sacheti - Independent Director (DIN : 02266703)

^{place : Abu Road} Alok Jain -Chief Financial Officer

^{Date : 28th May}, ²⁰²⁵ Harshita Hetawal - Company Secretary

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Mar 31, 2024

(m) Provisions, contingent liabilities and contingent assets

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event and it is probable that an outflow of resources, that can be reliably estimated, will be required to settle such an obligation.

If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows to net present value using an appropriate pre-tax discount rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. Unwinding of the discount is recognised in the Statement of Profit and Loss as a finance cost.

The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at reporting date, taking into account the risks and uncertainties surrounding the obligations. Provisions are reviewed at each reporting date and are adjusted to reflect the management’s best estimate.

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, is disclosed as a contingent liability. Contingent liabilities are also 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. These are reviewed at each balance sheet date and are adjusted to reflect the current management estimate.

Claims against the Company where the possibility of any outflow of

resources in settlement is remote, are not disclosed as contingent liabilities.

Contingent assets are not recognised in financial statements since this may result in the recognition of income that may never be realised. However, when the realisation of income is virtually certain, then the related asset is not a contingent asset and is recognised.

(n) Foreign currency transactions and translations

Transactions in foreign currencies, other than the Company’s functional currency are recognised at the exchange rates prevailing at the dates of the transactions. At the end of each reporting period, monetary assets and liabilities denominated in foreign currencies are translated at the rate prevailing at that date. Non-monetary items that are measured in terms of historical cost in a foreign currencyarenot translated. Exchange differences on monetary items are recognised in the statement of profit and loss in the period in which these arise.

(o) Revenue recognition

Effective 01 April 2018, the Company has adopted Indian Accounting Standard 115 (Ind AS 115) - Revenue from contracts with customers ’. The impact of the adoption of Ind-AS 115 on the financial statements of the Company is insignificant.

Revenue is recognized on satisfaction of performance obligation upon transfer of control of promised goods or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those goods or services.

The Company satisfies a performance obligation and recognizes revenue over time, if one of the following criteria is met:

(i) The customer simultaneously receives and consumes the benefits provided by the Company’s performance; or

(ii) The Company’s performance creates or enhances an asset that the customer controls as the asset is created or enhanced; or

(iii) The Company’s performance does not create an asset with an alternative use to the Company and an entity has an enforceable right to payment for performance completed to date.

For performance obligations where one of the above conditions is not met, revenue is recognized at the point in time at which the performance obligation is satisfied.

If the Company has any contract wherein the period between transfer of the promised goods or services to the customer and payment by the customer exceeds one year, transaction price is adjusted for the time value of money.

(p) Other operating revenues / other income

(i) Income from services is recognized (net of GST as applicable) based on the services rendered in accordance with the terms of contracts.

(ii) For all financial instruments measured at amortized cost, interest income is recorded using the effective interest rate (EIR), which is the rate that exactly discounts the estimated future cash receipts over the expected life of the financial instrument to the gross carrying amount of the financial asset.

(iii) Interest income for all financial instruments measured at fair value through other comprehensive income is recognized in the statement of profit and loss.

(iv) Dividend income is accounted for when the right to receive the income is established.

(v) Export incentives under various schemes are recognized in the year of export.

(q) Employee Benefits

Short term employee benefits

Short-term employee benefit obligations are recognized as an expense on accrual basis.

Defined contribution plans

Defined contribution plans are those plans in which an entity pays fixed contribution into separate entities and will have no legal or constructive obligation to pay further amounts. Provident fund and employee state insurance are defined contribution plans in which company pays a fixed contribution and will have no further obligation.

Defined benefit plans

A defined benefit plan is a post-employment benefit plan other than a defined contribution plan.

Company pays Gratuity as per provisions of the Payment of Gratuity Act, 1972. The Company’s net obligation in respect of defined benefit plans is calculated separately for each plan by estimating the amount of future benefits that employees have earned in return for their services in the current and prior periods; that benefit is discounted to determine its present value. Any unrecognized past service costs and the fair value of any plan assets are deducted. The discount rate is based on the prevailing market yields of Indian government securities as at the reporting date that have maturity dates approximating the terms of the Company’s obligations and that are denominated in the same currency in which the benefits are expected to be paid.

The calculation is performed annually by a qualified actuary using the projected unit credit method. When the calculation results in a liability to the company, the present value of liability is recognized as provision for employee benefit. Any actuarial gains or losses are recognized in Other Comprehensive Income in the period in which they arise. Other long-term employee benefits

Benefits under the Company’s leave encashment constitute other long term employee benefits.

The Company’s net obligation in respect of leave encashment is the amount of future benefits that employees have earned in return for their service in the current and prior periods, that benefit is discounted to determine its present value and the fair value of any related assets is deducted. The discount rate is based on the prevailing market yields of Indian government securities as at the reporting date that have maturity dates approximating the terms of the Company’s obligations. The calculation is performed using the projected unit credit method. Any actuarial gains or losses are recognized in the Statement of profit and loss in the period in which they arise.

(r) Research and development expenditure

Revenue expenditure on research and development is charged as an expense in the year in which it is incurred under the respective heads of accounts. Expenditure which results in the creation of capital assets is capitalised and depreciation is provided on such assets as applicable.

(s) Income taxes

Income Tax expenses comprise current tax and deferred tax charge or credit.

Current Tax is measured on the basis of estimated taxable income for the current accounting period in accordance with the applicable tax rates and the provisions of the Income-tax Act, 1961 and other applicable tax laws.

Deferred tax is provided, on all temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred tax assets and liabilities are measured at the tax rates that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted at the reporting date. Deferred tax assets and liabilities are offset, if there is a legally enforceable right to offset current tax liabilities and assets and they relate to income taxes levied by the same tax authority.

A deferred tax asset is recognized to the extent that it is probable that future taxable profits will be available against which the temporary

differences can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent it is no longer probable. Income tax expenses relating to items recognised directly in equity or OCI is recognised in equity or OCI and not in the Statement of Profit and Loss.

(t) Leases

Leases are classified as finance leases, when the terms of the lease, transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as Operating Leases.

Operating Lease: Lease rentals are charged or recognised in the statement of profit and loss on a straight-line basis over the lease term. Finance Lease: Assets held under finance leases are recognised as assets of the Company at their fair value at the inception of the lease or, if lower, at the present value of the minimum lease payments. Lease payments are apportioned between finance charges and reduction of the lease obligation. Finance charges are charged to the Statement of Profit and Loss, unless they are directly attributable to qualifying assets, in which case they are capitalised in accordance with the Company’s policy on borrowing costs.

(u) Impairment of non-financial assets

At the end of each reporting period, the Company reviews the carrying amounts of non-financial assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). When it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cashgenerating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in Statement of Profit and Loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease. When an impairment loss subsequently reverses, the carrying amount of the asset (or a cash-generating unit) is increased to the revised estimate of its recoverable amount, but to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in the Statement of Profit and Loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

(v) Impairment of financial assets

At the end of each reporting period, the Company applies the expected credit loss model for recognizing the impairment loss on financial assets including trade receivables. Expected credit loss is the difference between the contractual cash flows and the cash flows the entity expects to receive using effective interest rate.

Loss allowance for trade receivables is measured at an amount equal to lifetime expected credit losses. For other financial assets, expected credit losses are measured at an amount equal to the 12 month expected credit losses unless there is significant increase in the credit risk from initial recognition in which case those are measured at lifetime expected credit losses. Lifetime expected credit losses are expected credit losses that result from all possible defaults over the expected life of financial

instrument. Lifetime expected credit losses are computed based on provision matrix which takes into account historical credit losses adjusted for forward looking information, suit filed cases and credit information of customers.

w) Segment reporting Identification of Segments

Operating Segments are identified based on monitoring of operating results by the Board of Directors separately for the purpose of making decision about resource allocation and performance assessment. Segment performance is evaluated based on profit or loss and is measured consistently with profit or loss of the Company.

Operating Segments are identified based on the nature of products and services, the different risks and returns and the internal business reporting system.

Segment Policies

The Company prepares its segment information in conformity with the accounting policies adopted for preparing and presenting the financial statements of the Company as a whole.

x) Material prior period errors

Material prior period errors are corrected retrospectively by restating the comparative amounts for the prior periods presented in which the error occurred. If the error occurred before the earliest prior period presented, the opening balances of assets, liabilities and equity for the earliest prior period presented, are restated.

y) Earnings Per Share (EPS)

The basic EPS is computed by dividing the profit after tax for the year attributable to the equity shareholders by the weighted average number of equity shares outstanding during the year.

For the purpose of calculating diluted EPS, profit after tax for the year attributable to the equity shareholders and the weighted average number of equity shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

z) Fair value Measurement

The company measures financial instruments, such as investments and derivatives at fair value at each reporting date.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

• In the principal market for the asset or liability, or

• in the absence of a principal market, in the most advantageous market for the asset or liability.

A fair value measurement of a non financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The company uses valuation technique that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

Fair values are categorized into different levels in the hierarchy as under:

• Level 1: Quoted (unadjusted) market prices in active markets for identical assets or liabilities

• Level 2: Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable.

• Level 3: Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

(aa) Financial instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. Financial assets and financial liabilities are recognized when a Company becomes a party to the contractual provisions of the instruments.

i) Initial Recognition: Financial assets and Financial liabilities

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss and ancillary costs related to borrowings) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognised immediately in statement of profit and loss.

ii) Classification and Subsequent Measurement: Financial Assets

The Company classifies financial assets as subsequently measured at amortised cost, fair value through other comprehensive income (“FVOCI”) or fair value through profit or loss (“FVTPL”) on the basis of following:

• the entity’s business model for managing the financial assets and

• the contractual cash flow characteristics of the financial asset. At amortised cost:

A financial asset shall be classified and measured at amortised cost if both of the following conditions are met:

• the financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows and

• the 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.

After initial recognition, such financial assets are subsequently measured at amortised cost using expected interest rate (EIR) method. In case of financial assets at amortised costs, interest income, foreign exchange gain or loss and impairment are recognized in Statement of profit and loss.

At fair value through OCI:

A financial asset shall be classified and measured at fair value through OCI if both of the following conditions are met:

• the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and

• the 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.

Where the Company has elected to present the fair value gain on equity instruments in other comprehensive income, there is no subsequent classification of fair value gain or losses to profit and loss account. Dividend from such instruments is recognized in profit and loss account as other income where right to receive is established.

At fair value through Profit or Loss:

A financial asset shall be classified and measured at fair value through profit or loss other than those measured at amortised cost or at fair value through OCI.

All recognised financial assets are subsequently measured in their

entirety at either amortised cost or fair value, depending on the classification of the financial assets.

Impairment of financial assets:

Financial assets, other than those at FVTPL, are assessed for indicators of impairment at the end of each reporting period. In case of trade receivables, the Company follows the simplified approach permitted by Ind AS 109 - Financial Instruments for recognition of impairment loss allowance. The Company recognises a loss allowance for expected credit losses on financial asset. The Company’s trade receivables do not contain significant financing component and loss allowance on trade receivables is measured at an amount equal to life time credit expected losses. The Company calculates the expected credit losses on trade receivables using a provision matrix on the basis of its historical credit loss experience.

Derecognition of financial assets:

The Company derecognises a financial asset when the contractual rights to receive the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another party. If the Company neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Company recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the Company retains substantially all the risks and rewards of ownership of a transferred financial asset, the Company continues to recognise the financial asset and also recognises associated liabilities.

On derecognition of a financial asset, other than investments classified as FVOCI, in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable and the cumulative gain or loss that had been recognised in other comprehensive income and accumulated in equity is recognised in profit or loss if such gain or loss would have otherwise been recognised in profit or loss on disposal of that financial asset.

iii) Classification and Subsequent Measurement:

Financial liabilities

Financial liabilities are classified as either financial liabilities at FVTPL or ‘other financial liabilities’

Financial Liabilities at FVTPL:

Financial liabilities are classified as at FVTPL when the financial liability is held for trading or are designated upon initial recognition as FVTPL. Gains or losses on liabilities held for trading are recognised in the statement of profit and loss.

Other Financial Liabilities:

Other financial liabilities (including borrowings and trade and other payables) are subsequently measured at amortised cost using the effective interest method.

Derecognition of Financial Liabilities:

The Company derecognises a financial liability when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms or the terms of an existing liability are substantially modified, such exchange or modification is treated as derecognition of the original liability and the recognition of a new financial liability. The difference in the respective carrying amounts is recognised in the statement of profit or loss.

The difference between the carrying amount of financial liability derecognized and consideration paid and payable is recognized in the statement of profit and loss.

On derecognition of equity investments classified as FVOCI, accumulated gains or loss recognised in OCI is transferred to retained earnings.

(bb) Financial liabilities and equity instruments

• Classification as debt or equity

Debt and equity instruments issued by the Company are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.

• Equity instruments

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by a Company are recognised at the proceeds received.

(cc) Derivative financial instruments

The Company enters into derivative financial instruments viz. foreign exchange forward contracts to manage foreign exchange risks. The Company does not hold derivative financial instruments for speculative purposes.

Derivatives are initially recognised at fair value on the date derivative contracts are entered into and are subsequently remeasured at their fair value at the end of each reporting period. The resulting gain or loss is recognised in statement of profit and loss.

Note no. 1A. Significant Accounting Judgements, Estimates and Assumptions

The preparation of the Company’s financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets, liabilities, the accompanying disclosures and the disclosure of contingent liabilities. Continuous evaluation is done on estimates and judgments based on historical experience and other factors, including expectation of future events that are believed to be reasonable. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

Estimates made in preparing Financial Statements:

(a) Useful life of Property, plant and equipment and intangible

assets

The Company uses its technical expertise along with historical and industry trends for determining the economic life of an asset/

component of an asset. The useful lives are reviewed by management periodically and revised, if appropriate. In case of a revision, the unamortized depreciable amount is charged over the remaining useful life of the assets.

(b) Post-employment benefit plans

Employees benefit obligations are measured on the basis of actuarial assumptions which include mortality and withdrawal rates as well as assumptions concerning future developments in discount rates, the rate of salary increases and the inflation rate. The Company considers that the assumptions used to measure its obligations are appropriate and documented. However, any changes in these assumptions may have a material impact on the resulting calculations.

(c) Expected credit losses on financial assets

The loss allowance on financial assets including trade receivables are based on assumption about the risk of default and expected timing of collection. The Company uses judgement in making these assumptions and selecting the inputs to the expected credit loss calculation based on Company’s history of credit losses adjusted to reflect current and estimated future economic conditions, suit filed cases and credit information of customers at the end of each reporting period.

(d) Provisions and contingencies

The assessments undertaken in recognizing provisions and contingencies have been made in accordance with Ind AS 37, ‘Provisions, Contingent Liabilities and Contingent Assets’. The evaluation of the likelihood of the contingent events requires best judgment by the management regarding the probability of exposure to potential loss. If circumstances change following unforeseeable developments, this likelihood could alter.

(e) Impairment of non-financial assets

The company has used certain judgments and estimation to estimate future projection and discount rate to compute value in used of assets/cash generating units and to assess impairment.

(f) Revenue recognition

The company recognised the revenue from contract with customers based on 5 steps model as per Ind AS- 115 which involve judgments relating to identification of contracts with customers, identification of distinct performance obligation, determination of transaction price with respect to identified performance obligation, appropriateness of the basis used to recognise revenue and when the control of goods and services are being transferred.

Note No. 39 : Capital Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for '' 923.23 Lacs (net of advances '' 645.29 Lacs) 31st March, 2023- '' 10.95 Lacs.

Note No. 40 : Capital Management

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

The Company manages its capital so as to safeguard its ability to continue as a going concern and to optimise returns to shareholder. The capital structure of the Company is based on management’s judgement of its strategic and day-to-day needs with a focus on total equity so as to maintain investors, creditors and market confidence. The management and the Board of Directors monitors the return on capital. The Company may take appropriate steps in order to maintain, or if necessary adjust, its capital structure.

Note No. 41 : Financial Risk Management

The Company’s Financial Risk Management is an integral part of how to plan and execute its business strategies. The Company’s financial risk management is set by the Managing Board. The Company’s principal financial liabilities comprise loans and borrowings, trade payables and other payables. The main purpose of these financial liabilities is to finance the company’s operations. The company’s principal financial assets include trade & other receivables, investments, cash and short term deposits. i) Credit risk

Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. To manage this, the Company periodically assesses the financial reliability of customers and other counter parties, taking into account financial conditions, current economic trends and analysis of historical bad debts and ageing of financial assets. Individual risk limits are set and periodically reviewed based on such information.

Financial assets are written off when there are no reasonable expectations of recovery, such as a debtor failing to engage in a repayment plan with the Company. Where loans or receivables have been written off, the Company continues to engage in enforcement activity to attempt to recover the receivable due. Where recoveries are made, these are recognized as income in the statement of profit and loss.

The Company measures the expected credit loss of trade receivables based on historical trend and the business environment in which the entity operates. Loss rates are based on actual credit loss experience and past trends. The Company provides loss allowance on trade receivables using life time expected credit loss and as per simplified approach.

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

(vi) The company has not received any fund from any other person(s) or entity(ies) ,including foreign entities (funding party) with the understanding (whether recorded in writing or otherwise) that the company shall:

a. directly or indirectly lend to or invest in other persons or entities identified in any manner whatsoever by or on behalf of funding party (Ultimate beneficiaries) or

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

(vii) The company has no such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 such as ,search or survey or any other relevant provisions of the Income Tax Act, 1961.

(viii) The Company has not been declared as willful defaulter by any bank or financial institution or other lenders in accordance with the guidelines issued by Reserve Bank of India.

Note No. 51: The Company has a process whereby periodically all long term contracts (including derivative contract) are assessed for material foreseeable losses. At the year end, the Company has reviewed and ensured that adequate provision as required under any law/accounting standards for material foreseeable losses on such long term contracts (including derivative contracts) has been made in the books of accounts.

Note No. 52: The Company has used such accounting software for maintaining its books of accounts for the year ended 31 March 2024, which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software and has not been tampered with at any time during the year, except one unit (separate segment) of the company where accounting software used for maintaining books of accounts for the year ended 31 March 2024 does not have a feature of recording audit trail (edit log) facility.

Note No 53: The Financials Statements were approved for issue by the directors on 30th May, 2024.

Note No 54: Figures for previous years have been regrouped/rearranged/restated wherever considered necessary to make them comparable with the figures for the current year.

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

For R B Verma & Associates

Chartered Accountants Sachin Ranka - Chairman & Managing Director (DIN : 00335534)

Firm Registration No. 012650C

Shreyans Ranka - Whole-Time Director (DIN : 06470710)

Rajesh Verma

Partner Vikas Sharma - Executive Director (DIN : 00761202)

Membership No. 404029

S.K. Sharma - Independent Director (DIN : 01378040)

Place : Abu Road

Date : 30th May, 2024 Rahul Singhvi - Independent Director (DIN : 08816920)

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Mar 31, 2023

1. Terms/rights attached to equity shares

The company has only one class of equity shares having a par value of Rs.10/- per share. Each Holder of equity shares is entitled to one vote per share.In the event of liquidation, the equity shareholders are eligible to receive the residual assets of the company after distribution of preferential amount, in proportion to their shareholding.

Notes forming part of standalone financial statements

2. The description of the nature and purpose of each reserve within equity is as follows:

A. Capital Reserve: Capital Reserve is created mainly on amalgamation of Modern Terry Towel ltd.(MTTL) with the Company. This reserve is utilised in accordance with the provisions of the Act.

B. Securities Premium Reserve: Securities premium reserve is created due to premium on issue of shares. This reserve is utilised in accordance with the provisions of the Act.

16.1 Term loans from banks are secured against hypothecation of the specific vehicles.

16.2 Term loans from banks (for vehicles) are repayable as per various payment schedules. Last installment due in April 2029. Rate of Interest varies from 7.4% to 9.15%. p.a. (31st March, 2022- 7.40% to 9.15% p.a.)

Disclosure of payable to vendors as defined under the “Micro, Small and Medium Enterprise Development Act, 2006” is based on the information available with the Company regarding the status of registration of such vendors under the said Act, as per the intimation received from them on requests made by the company and has being relied upon by the auditors.

21.3 Refer note no 46 for ageing of trade payable.

iv) (a) Provision for taxation including interest estimated at '' 1762.36 lacs for the year ended 31st March, 2023 (31st March, 2022- ''1306.15 Lacs; upto the

year '' 7719.25 lacs) has not been made in accounts in view of the proposed amalgamation under the provisions of Companies Act, 2013.

b) Company has claimed the losses pertaining to Modern Denim Limited in its income tax return from AY 2017-18, with which the company has proposed amalgamation. Income Tax Department has completed assessment for Assessment Year 2017-18 and 2018-19 and has disallowed such losses claimed pursuant to proposed amalgamation pending approval from concerned authorities. However, the Company has filed appeal against the said order before CIT (Appeals) which is pending. The Company is confident for favourable order as it has received relief in previous years in similar matter.

v) Income tax department had completed assessments for A.Y. 2008-09 to 2018-19 wherein assessments on substantive basis were done with NIL liability by allowing losses of Modern Terry Towel Ltd. (the amalgamated entity) and simultaneously assessments on protective basis were also done (except for A.Y. 2014-15, 2016-17,2017-18 and 2018-19) presuming that no amalgamation had taken place. Since amalgamation scheme have been sanctioned by the Hon’ble BIFR vide its order dated 28.07.2016, protective assessment orders passed by the department have become ineffective and substantive assessment orders are prevailed. However, effect of BIFR order is yet to be given by the department for which company is taking necessary steps. There is no recoverable demand as on date.

- Investment Risk - If Plan is funded then assets liabilities mismatch & actual investment return on assets lower than the discount rate assumed at the last valuation date can affect the liability.

- Discount Rate : Reduction in discount rate in subsequent valuations can increase the plan’s liability.

- Mortality & disability - Actual deaths & disability cases proving lower or higher than assumed in the valuation can affect the liabilities. -Withdrawals - Actual withdrawals proving higher or lower than assumed withdrawals and change of withdrawal rates at subsequent valuations can affect liability.

iv) Long term employee benefit Leave encashment

The company has a policy to pay leave encashment. Every employee is entitled to claim leave encashment after his/her retirement/termination which is calculated based upon no. of leaves earned. The company has a total provision for leave encashment as on 31st March, 2023- '' 415.34 Lacs and as on 31st March, 2022- '' 451.17 Lacs. Total expenses provided during the year 2022-23 is '' 44.48 Lacs and for the year 2021-22 '' 83.86 Lacs. Current Service Cost of '' 56.92 Lacs for the year 2022-23 and '' 69.35 Lacs for the year 2021-22 based on actuarial valuation.

Terms and conditions:

Related party relationships are as identified by the management and relied upon by the auditor.

All the transactions with related parties were made on normal commercial terms and conditions and at market rates. The above transactions are as per the approval of audit committee.

Decision relating to remuneration to key management personnel were taken based on the recommendation of Nomination and Remuneration committee. *Expenses towards gratuity and leave encashment are determined actuarially on overall company basis at the end of each year and accordingly have not been considered in remuneration.

Note No. 37 : Contingent Liabilities Contingent liabilities to the extent not provided for in respect of			(? in Lacs)
PARTICULARS		31st March, 2023	31st March, 2022
Guarantees given by bankers on behalf of the company		989.86	930.25
Outstanding letters of credit		35.58	400.57
Disputed liabilities, not acknowledged as debts		485.47	494.69
Disputed Income Tax demand (Deposited under protest '' 7.50 Lacs, 31st March, 2022- '' 7.50	Lacs)	7.50	7.50
Disputed Land Tax demand (Deposited under protest '' 15.70 Lacs, 31st March, 2022- '' 15.70	Lacs)	15.70	15.70
Disputed GST demand (Deposited under protest '' 2.75 Lacs, 31st March, 2022- '' Nil Lacs)		210.52	85.49
Doubtful advances to creditors		14.79	14.79

The Company, in respect of contingent liability, has assessed that it is not probable that outflow of economic resources will be required and hence not provided by the Company.

Note No. 38 : Capital Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances '' 9.72 Lacs) ''10.95 Lacs (31st March, 2022- '' 47.81 Lacs).

Note No. 39 : Capital Management

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

The Company manages its capital so as to safeguard its ability to continue as a going concern and to optimise returns to shareholder. The capital structure of the Company is based on management’s judgement of its strategic and day-to-day needs with a focus on total equity so as to maintain investors, creditors and market confidence. The management and the Board of Directors monitors the return on capital. The Company may take appropriate steps in order to maintain, or if necessary adjust, its capital structure.

Note No. 40 : Financial Risk Management

The Company’s Financial Risk Management is an integral part of how to plan and execute its business strategies. The Company’s financial risk management is set by the Managing Board. The Company’s principal financial liabilities comprise loans and borrowings, trade payables and other payables. The main purpose of these financial liabilities is to finance the company’s operations. The company’s principal financial assets include trade & other receivables, investments, cash and short term deposits. i) Credit risk

Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. To manage this, the Company periodically assesses the financial reliability of customers and other counter parties, taking into account financial conditions, current economic trends and analysis of historical bad debts and ageing of financial assets. Individual risk limits are set and periodically reviewed based on such information.

Financial assets are written off when there are no reasonable expectations of recovery, such as a debtor failing to engage in a repayment plan with the Company. Where loans or receivables have been written off, the Company continues to engage in enforcement activity to attempt to recover the receivable due. Where recoveries are made, these are recognized as income in the statement of profit and loss.

The Company measures the expected credit loss of trade receivables based on historical trend and the business environment in which the entity operates. Loss rates are based on actual credit loss experience and past trends. The Company provides loss allowance on trade receivables using life time expected credit loss and as per simplified approach.

iii) Market Risk

Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in the price of a financial instrument. The value of a financial instrument may change as a result of changes in the interest rates, foreign currency exchange rates, equity prices and other market changes that affect market risk sensitive instruments. Market risk is attributable to all market risk sensitive financial instruments including investments and deposits, foreign currency receivables, payables and loans and borrowings. a) Foreign currency risk

The company operates internationally and portion of the business is transacted in several currencies and consequently the company is exposed to foreign exchange risk through its sales in overseas and purchase from overseas suppliers in various foreign currencies.

The company evaluate exchange rate exposure arising from foreign currency transaction and the company follow established risk management policies, including the use of derivative like foreign exchange forward contracts to hedge exposure to foreign risk.

Interest rate sensitivity has been calculated assuming the borrowings outstanding at the reporting date have been outstanding for the entire reporting period.

Note No 41. Disclosure as per Ind AS- 27, separate financial statement

The company had entered into Joint Venture Agreement with Shriji Designs by incorporating new JV firm M/s Shriji Designs -MIL (JV) to participate in railways EPC tenders. The JV had been awarded tender for design, supply, erection, testing and commissioning of 25 KV OHE between sanwad-nimarkhedi NTPC siding of western railway. As per the joint venture working agreement entered with Shriji Designs, execution is entirely in the scope of MIL and company has to pay 2% fees to JV partner. Accordingly 100% profit/loss of JV is part of the company.

The company had entered into Joint Venture Agreement with Sikka Engineering Company by incorporating new JV firm M/s SEC-MIL (JV) to participate in railways EPC tenders. As per the joint venture working agreement entered with Sikka Engineering execution of contract , if any awarded to JV firm will be entirely in the scope of MIL and company will pay 2.25% commission of contract value to JV partner.

Accounting method used for consolidation purpose - Equity Method

Fair Value of Financial instrument measured at Amortised Cost

The carrying amount of short term borrowings, trade payables, trade receivables, cash & cash equivalents and other financial assets and liabilities are considered the same as their Fair values, due to their short term nature.

Note No 43. CORPORATE SOCIAL RESPONSIBILITY (CSR) EXPENDITURE

(i) As per section 135 of Companies Act, 2013 gross amount required to be spent by the company during the year 2022-23 - '' 50.23 Lacs (Previous Year 2021-22''52.13 Lacs)

(ii) Amount spent on on-going projects by the company as at 31st March, 2023— '' Nil Lacs (as at 31st March-2022- '' Nil Lacs)

(ii) The Company has granted interest free unsecured loan of '' 5939 Lacs (31st March, 2022- '' 5524 Lacs) (maximum amount outstanding at any time during the year '' 5939 Lacs; 31st March, 2022- '' 5525 lacs) to a Company covered in the register maintained under section 189 of the Companies Act, 2013 in view of proposed amalgamation under the provisions of Companies Act, 2013. Since the amount paid is in connection to proposed amalgamation, no terms have been specified for repayment of loan and interest. In view of likely advantage to the Company on such amalgamation, granting of such loan is not prejudicial to the interest of the Company

(iii) The Company has granted unsecured loan to Joint Venture and Subsidiary Company covered in the register maintained under section 189 of the Companies Act, 2013, which is payable on demand. The Company has received the amount demanded from the party and thus there is no default during the year. Interest on such loan has been paid / provided during the year except loan to 100% Subsidiary Company. The terms and conditions of grant of such loan are not, prejudicial to the interest of the Company.

(iii) The company do not have any charges or satisfaction which is yet to be registered with Registrar of Companies beyond the statutory period.

(iv) The company has not traded or invested in crypto currency or virtual currency during the financial year.

(v) The company has not advanced or loaned or invested funds to any other person(s) or entity(ies) ,including foreign entities (intermediaries) with the understanding that the intermediary shall:

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

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

(vi) The company has not received any fund from any other person(s) or entity(ies) ,including foreign entities (funding party) with the understanding (whether recorded in writing or otherwise) that the company shall:

a. directly or indirectly lend or or invest in other persons or entities identified in any manner whatsoever by or on behalf of funding party (Ultimate beneficiaries) or

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

(vii) The company has no such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act,1961 such as ,search or survey or any other relevant provisions of the Income Tax Act,1961.

(viii) The Company has not been declared as willful defaulter by any bank or financial institution or other lenders in accordance with the guidelines issued by Reserve Bank of India.

Note No. 50: The Company has a process whereby periodically all long term contracts (including derivative contract) are assessed for material foreseeable losses. At the year end, the Company has reviewed and ensured that adequate provision as required under any law/accounting standards for material foreseeable losses on such long term contracts (including derivative contracts) has been made in the books of accounts.

Note No. 51. The Financials Statements were approved for issue by the directors on 29th May, 2023.

Note No 52. Figures for previous years have been regrouped/rearranged/restated wherever considered necessary to make them comparable with the figures for the current year.

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Mar 31, 2014

1.1 Other Loans are secured against hypothecation of the specific assets.

1.2 Other loans are repayable as per various payment schedules. Last instalment due in September-2016. Rate of Interest 10.65% p.a.

(Previous year 8.08% to 9.09% p.a.). - .

2. EXCEPTIONAL ITEMS

Pursuant to Arbitration award, the company has entered into a tripartite agreement for assignment of its recoverable loan to Zero Coupon Debenture holder in full and final settlement of their dues; this has resulted into a loss ofRs. 1040 lacs and the same has been shown as exceptional item in the statement of Profit and Loss.

3. CONTINGENT LIABILITIES NOT PROVIDED FOR

(Rs. in lacs)

As at As at 31.03.2014 31.03.2013

i) Guarantees given by bankers on behalf of the Company 2216.26 2304,18

ii) Outstanding Letters of Credit 104.69 104.22

iii) Disputed liabilities, not acknowledged as debts 195.12 67.43

iv) Disputed Income Tax demand 7.50 7.50

Deposited under protest Rs. 7.50 Lacs (Previous Year Rs. 7.50 Lacs)

v) Disputed Land Tax demand 15.70 15.70

Deposited under protest Rs. 15.70 Lacs (Previous Year Rs. 15.70 Lacs)

vi) Disputed Excise duty/Service Tax demands 217.57 287.16

Deposited under protest Rs. 20.28 Lacs (Previous YearRs. 37.64 Lacs)

vii) Disputed Sales Tax demand 448.59 525.37

Deposited under protest Rs. 85.57 Lacs (Previous Year Rs. 68.01 Lacs).

viii) Interest on disputed''Entry Tax 403.78 295.07

4. Profit for the year has been arrived at after adjusting prior year debits Rs. 7.07 lacs (Previous year Rs. 21.34 lacs) and prior year credits Rs. 2.09 Lacs (Previous year Rs. 12.46 Lacs). Expenses/Income arisen/settled during the year have been charged to revenue.

5. Long term loans and advances include interest free loan ofRs. 2715.95 lacs (Previous year Rs. 2245.15 lacs) paid to a company covered under section 301 of Companies Act 1956 in view of proposed amalgamation awaiting approvals (Maximum amount due at any time during the year Rs. 3326.95 lacs; previous year Rs. 2789.85 lacs).

6. Provision for taxation (including interest) estimated at Rs. 885.79 lacs for current year (upto the year Rs. 7148.07 lacs) has not been made in accounts, in view of proposed amalgamation proceedings awaiting approvals. Meanwhile Income Tax Department has completed assessments for Assessment Year 2008-09 & 2009-10 & 2011-12 wherein substantive orders have been passed allowing losses pertaining to proposed amalgamation and at the same time protective assessment orders have been made (presuming that no amalgamation had taken place) with demand ofRs. 2710.22 lacs which shall be effective if the amalgamation scheme is not sanctioned. The department had also completed assessment for the Assessment Year 2010-11 and had raised demand ofRs. 961.47 lacs in respect of disallowance of losses pertaining to proposed amalgamation pending approval from concerned authorities; the company has filed appeal against the said demand before CIT (Appeals).

7. Research and Development expenditure debited to the Statement of Profit and Loss by charge to relevant heads of account amounting to Rs. 277,12 lacs (previous year Rs. 409.61 lacs).

8. Related party Disclosures as per Accounting Standard 18:

i) Related Party Relationships :

a) Where control exists

Modem Terry Towels Ltd.

Modem Denim Ltd. -

b) Key Management Personnel;

Shri Sachin Ranka (Chairman & Managing Director)

Shri H.L. Sharma (Executive Director)

Shri D.B. Deshpande (Executive Director)

Shri R.R. Maheshwari (Executive Director-upto 30.04.2013) -

c) Subsidiary Companies :

Motile Power Trade Pvt. Ltd.

Gujarat Polyfils (India) Ltd.

d) Relatives of key Management Personnel and their enterprises where transactions have taken place:

Shubham Corporate Advisory Services Pvt. Ltd.

Smt. Meena Ranka

Smt. Smriti Ranka -

Shri Shreyans Ranka

9. Previous year''s figures have been regrouped and rearranged wherever necessary, to make them comparable with those of current year.

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Mar 31, 2013

1. Profit for the year has been arrived at after adjusting prior year debits X 21.34 lacs (Previous year Rs. 12.26 lacs) and prior year credits Rs. 12.46 Lacs (Previous year Rs. Nil). Expenses/Income arisen/settled during the year have been charged to revenue.

2. Long term loans and advances include interest free loan off 2245.15 lacs (Previous yearRs. 2245.15 lacs) paid to a company covered under section 301 of Companies Act 1956 in view of proposed amalgamation awaiting approvals (Maximum amount due at any time during the year Rs. 2789.85 lacs; previous year Rs. 2245.151acs).

3. Provision for taxation (including interest) estimated at Rs. 624.69 lacs for current year (upto the yearRs. 5939.72 lacs) has not been made in accounts, in view of proposed amalgamation proceedings awaiting approvals. Meanwhile Income Tax Department has completed assessments for Assessment Year 2008-09 & 2009-10 wherein substantive orders have been passed allowing losses pertaining to proposed amalgamation and at the same time protective assessment orders have been made (presuming that no amalgamation had taken place) with demand ofRs. 1611.16 lacs which shall be effective if the amalgamation scheme is not sanctioned. The department has further completed assessment for the Assessment Yeas 2010-11 pending approval from concerned authorities. The company has filed appeal against the said demand before CIT (Appeals).

4. Research and Development expenditure debited to the Statement of Profit and Loss by charge to relevant heads of account amounting to Rs. 409.61 lacs (previous year Rs. 288.86 lacs). ,

5. Related party Disclosures as per Accounting Standard 18:

i) Related Party Relationships :

a) Where control exists Modem Denim Ltd. Modem Terry Towels Ltd.

b) Key Management Personnel : Shri Sachin Ranka (Chairman)

Shri R.R. Maheshwari (Executive Director)

Shri H.L. Sharma (Executive Director)

Shri R.K. Ladia (Executive Director-upto 13.09.2012)

Shri D.B. Deshpande (Executive Director-w.e.f. 01.01.2013

c) Subsidiary Companies Motile Power Trade Pvt Ltd. Gujarat Polyfils (India) Ltd.

d) Relatives of key Management Personnel and their enterprises where transactions have taken place: Smt Meena Ranka

Shubham Corporate Advisory Services Pvt Ltd. Shri Shreyans Ranka

6. Previous year''s figures have been regrouped and rearranged wherever necessary, to make them comparable with those of current year.

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Mar 31, 2012

1.1 Zero Coupon Secured Redeemable Debentures/advance subscription towards Zero Coupon Secured Redeemable Debentures are secured by way of second charge of all the immovable properties of yam division.

Term loans from financial institution are secured by (i) Exclusive first charge on all the immovable and movable fixed assets of yam division; (ii) First charge on all the assets of Motile Power Trade Pvt. Ltd. and Gujarat Polyfils (India) Ltd. (Subsidiary Companies); (iii) Personal guarantee of one of directors; (iv) Corporate guarantee from Motile Power Trade Pvt Ltd. and Gujarat Polyfils (India) Ltd. and (v) Pledge of all shares of Motile Power Trade Pvt Ltd. and Gujarat Polyfils (India) Ltd. Other Loans are secured against hypothecation of the specific assets.

1.2 Redemption of Zero Coupon Secured Redeemable Debentures/advance subscription towards Zero Coupon Secured Redeemable Debentures to commence from lstOctober2011 in quarterly instalments till entire redemption is completed on or before 30.09.2015. Term loan amounting to Rs.2160 lacs is repayable in 14quarterly instalments commencing from October 2010. Last instalment due inJanuary 2014. Rate of interest 13% p.a. (previous year 13% p.a.). Term loan amounting to 7384 lacs is repayable in 42 monthly instalments commencing from October 2009. Last instalment due in March 2013. Rate of interest 13% p.a. (previous year 13% p.a.). Other loans are repayable as per various payment schedules. Last instalment due in November 2013. Rate of Interest 8.08% to 9.09% p.a. (Previous year 8.08% to 9.09% p.a.).

2. CONTINGENT LIABILITIES NOT PROVIDED FOR

(Rs. in lacs) As at As at 31.03.2012 31.03.2011

i) Guarantees given by bankers on behalf of the Company 2084.18 1788.23

ii) Corporate Guarantees given by the Company 3.18 3.18

iii) Outstanding Letters of Credit 72.47 142.10

iv) Disputed liabilities' not acknowledged as debts 59.10 57.61

v) a) Disputed Income Tax demand 7.50 2.50

b) Deposited under protest 7.50 2.50

vi) Disputed Land Tax demand deposited under protest 14.07 12.44

vii) a) Disputed Excise duty/Service Tax demand 163.97 56.56

b) Deposited under protest 5.25 5.25

viii) a) Disputed Sales Tax demand 525.37 516.66

b) Deposited under protest 68.01 68.72

ix) Interest on disputed Entry Tax for the year 72.56 78.87 Upto the year 206.34 133.78

3. Profit for the year has been arrived at after adjusting prior year debits Rs. 12.26 lacs (Previous period Rs. 26.25 lacs) and prior year credits Rs. Nil (Previous period Rs. 1.35 iacs). Expenses/Income arisen/settled during the year have been charged to revenue.

4. Long term loans and advances include interest free loan ofRs. 2245.15 lacs (Previous periodRs. 1945.61 lacs) paid to a company covered under section 301 of Companies Act 1956 in view of proposed amalgamation awaiting approvals (Maximum amount due at any time during the year Rs. 2245.15 lacs; previous period Rs. 1945.61 lacs).

5. Provision for taxation (including interest etc.)estimated atRs. 680.16 lacs for current year (upto the year Rs. 4640.13 lacs) has not been made and Debenture Redemption Reserve amounting to Rs. 5.80 lacs has not been created' in view of proposed amalgamation proceedings awaiting approvals. Meanwhile Income Tax Department has completed assessment for Assessment Years 2008-09 &2009-10and demand ofRs. 1611.16 lacs has been raised in respect of disallowance of losses pertaining to proposed amalgamation pending approval from concerned authorities. However' the Company filed appeals against the said demand and CIT (Appeals) has directed the Assessing Officer to make substantive assessment order (allowing losses pertaining to proposed amalgamation) as well as protective assessment order (presuming that no amalgamation had taken place) sand further held that in case if the amalgamation scheme is not sanctioned then the protective assessment order shall prevail over the substantive order. Order of Assessing Officer giving appeal effect is awaited.

6. Research and Development expenditure debited to the Statement of Profit and Loss by charge to relevant heads of account amounting to Rs. 288.86 lacs (previous period Rs. 223.70 lacs).

7. Previous year's figures have been regrouped and rearranged wherever necessary' to make them comparable with those of current year. The figures in Statement of Profit and Loss for the previous period are for a period of 18 months and therefore the same are not comparable with the figures of current year to the extent Till the year ended 31st March 2011' the company was following pre-revised Schedule VI to the Companies Act' 1956' for preparation and presentation of its financial statement. During the year ended 31 st March' 2012' the revised schedule VI notified under the Companies Act' 1956' has become applicable to the company. The Company has reclassified previous year figures to conform to this year's classification. The adoption of revised schedule VI does not impact recognition and measurement principles followed for preparation of financial statement. However' it significantly impacts presentation and disclosures made in the financial statements' particularly presentation of Balance Sheet

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Sep 30, 2009

1. Estimated amount of contracts remaining to be executed on capital account, not provided for, net of advances Rs. 2414.87 lacs (Previous year Rs. 1525.40 lacs).

2. Contingent liabilities not provided for: -

i) Guarantees given by bankers on behalf of the Company Rs. 1166.15 lacs (Previous year Rs. 601.16 lacs).

ii) Corporate guarantees given by the Company Rs. 753.18 lacs (Previous year Rs. Nil).

iii) Outstanding Letters of Credit Rs. 152.22 lacs (Previous year Rs. 135.72 lacs).

iv) Pending Sales Tax Assessment for 2007-2008 & onwards; amount unascertainable.

v) Claims against the company, not acknowledged as debts Rs.35.46 lacs (Previous year Rs. 26.46 lacs).

vi) Disputed Income tax demand Rs. 2.50 lacs (Previous year Rs. 103.69 lacs) against which amount deposited under protest Rs. 2.50 lacs (Previous year Rs. 66.86 lacs). vii) Disputed Land Tax demand Rs. 9.18 lacs which has been deposited under protest (Previous year Rs. 6.12 lacs). viii) Disputed Service Tax demand Rs. 5.25 lacs which has been deposited under protest (Previous year Rs. 5.25 lacs) ix) Disputed Sales Tax demand Rs. 0.71 lacs which has been deposited under protest (Previous year Rs. 0.71 lacs).

4. Balances of debtors and creditors are subject to reconciliations/confirma tions;

5. Profit for the period has been arrived at after adjusting prior year debits Rs. 8.33 lac (Previous year Rs. 0.99 lacs) and prior year credits Rs. 6.48 lacs (Previous year Rs.0.90 lacs). Expenses/Income arisen/settled during the period have been charged to revenue.

6. In the opinion of the Board of Directors, Current Assets, Loans and Advances (including capital advances) have a value oh realisation in the ordinary course of business at least equal to the amount at which they are stated in Balance sheet. Adequate provisions have been made in accounts for all known liabilities.

7. Loans and advances include interest free amount of Rs. 280 lacs (Previous year Rs. nil) paid to a company covered under section 301 of Companies Act 1956 in view of proposed amalgamation awaiting approvals.

8. Inventories include goods in transit.

9. Sundry debtors include Rs.1.30 lacs (Previous year Rs. 1.30 lacs) under litigation for which adequate provision has been made.

10 i) In view of insufficient information from the suppliers regarding their status as SSI units, amount overdue to such undertakings could not be ascertained. ii)The Company has not received information from vendors regarding their status under the Micro, Small and Medium Enterprises Development Act 2006 and hence disclosure relating to amounts unpaid as at the period end together with interest paid/payable under this Act have not been given.

11. Provision for taxation (including interest etc.) estimated at Rs. 2252.65 lacs (including for previous year Rs. 927.28 lacs reversed during the period) has not been made in accounts. In view of proposed amalgamation proceedings awaiting approvals.

B) Secondary segment reporting (By geographical Segment) - The analysis of Geographical segment is based on geographical location of the customers, which is domestic and export.

12. Related party Disclosures as per Accounting Standard 18 :

i) Related Party Relationships :

a) Where control exists : Modern Denim Ltd. Modern Terry Towels Ltd. Modern Threads (I) Ltd.

b) Key Management Personnel : Shri Sachin Ranka (Director)

Shri R.R. Maheshwari (Director & Company Secretary) Shri H.L. Sharma (Executive Director) Shri R.K. Ladia (Executive Director)

c) Subsidiary Company : Motile Power Trade Pvt. Ltd.

d) Relatives of key Management Personnel and their enterprises where transactions have taken place : Smt. Meena Ranka

Shubham Corporate Advisory Services Pvt. Ltd.

13. Deferred Tax

i) Deferred tax has been provided in accordance with "Accounting Standard 22 - Accounting for taxes on income" issued by The Institute of Chartered Accountants of India. The additional net deferred tax liability amounting to Rs. 341.52 lacs has been adjusted in Profit & Loss Account.