During the year, the Company has subscribed 9,900 equity shares of Rs 10/- each ofNetweb Foundation (a Section 8 - Company as per Companies Act 2013)} Netweb Foundation became a subsidiary of the Company w.e f. May 25,2022 by virtue of holding 9,900 equity shares equivalent to 99% share capital in Netweb Foundation Netweb Foundation is prohibited to distribute any dividend / economic benefits to its members, hence the Company is unable to earn any variable return/ economic benefits from the voting rights through its holding m equity shares ofNetweb Foundation Accordingly, the above investment does not meet the definition of control under Ind AS 110 -’Consolidated Financial Statements' and the aforesaid investment v alue of Rs 0 10 millions has been charged off to the statement of profit and loss during the year ended 31 March 2023

(c) Terms/righls attached to equity shares

The ( o m pally lias only one class of equity shares having par value ot Rs 2 per share (PY Rs 10 per share). Each holder of equity sliares is entitled to one vote per share The Company declares and pays dividend, if any in Indian rupees The dividend proposed, it any by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meetutg.

Hie Board of Directors of the Company in the Board meeting dated February 15. 2023 and Sliareholders of the company in the Extra Ordinary General Meeting dated February 16. 2023 have approved the sub-division of each of the Equity' Share of the Company having a lace value of Rs. 10/- each in the Equity Share Capital of the Company be sub-divided into 5 Equity Shares having a lace value of Rs 2 - each ("Sub-division”). Further, the equity' portion of authorized share capital of the company was revised to 7.50.00.000 equity shares of face value of Rs 2 each t.e Rs 150 millions.

Further the Board of Directors at its meeting held on February 15, 2023. pursuant to Section 63 and other applicable provisions, if any. of the Companies Act, 2013 and rules made thereunder, proposed that a sum of Rs 15 27 millions be capitalized as Bonus Equity' shares out of free reserves and surplus, and distributed amongst the Equity Shareholders by issue of 2.26.32.8S0 Equity shares of Rs. 2 - each credited as fully paid to the Equity Shareholders ui the proportion of 4 (Four) Equity share for every 5 (Five) Equity shares It was approved in the meeting of sliareholders held on February 16, 2023 The Board of Directors ofthe Company in the Board meeting dated February 20. 2023 allotted the Bonus Equitv Shares to the shareholders of the Company

In the event of liquidation of the Company, the holders of equity sliares will be entitled to receive remaining assets ofthe Company, alter distribution of all preferential amounts. The distribution will be in proportion to the number of equity sliares held by the equity sliareholders

(d) Aggregate number of equity shares issued as bonus during the period of five years immediately proceeding the reporting date:_

Particulars As at 31-March-2023 As at 31-March-2022

Equity share alloted as frilly paid bonus sliares by capitalisation of Capital Reatmed Earnings and Security Premium 45.27

During the year ended March 31, 2023, the Company allotted 2,26,32,880 equity sliares as fully paid up bonus sliares in proportion of 4:1 (i.e. tour bonus sliares for every one equity share held) to the eligible members/beneficial owners, by capitalisation ofamount of Rs. 45.27 millions which was by way oftransfer from Retained Earnings Rs. 37.28 millions and Securities Premium Reserve. Rs. 7.99 millions.

Such bonus sliares rank pari passu in all respects and carry the same rights as the existing equity sliareholders and are entitled to participate in full, in any dividend and other corporate action, recommended and declared after the new equity shares are allotted.

(e) Share based payments

During the financial year 2022-23, Netweb- Employee Stock Option Plan 2023” pursuant to resolutions passed by Board of Directors of the Company at their meeting held on December 24, 2022 and by Shareholders ofthe Company at their meeting held on January 09,2023 and as amended by the Board of Directors ofthe Company at their meeting held on February 20, 2023 and approved by the Shareholders ofthe Company at their meeting held on February' 23, 2023. The Plan lias been made effective from January 21, 2023.

The stock options granted to each eligible employee shall vest over a period of 3 years with equal vesting from the grant date The eligible employees shall be entitled to exercise the vested options within the exercise period. The Exercise price ofthe stock options granted is INR 2. (Please refer note 53 for further details)

(h) The Board ofDirectors at their meeting held on May 19, 2023 has proposed dividend of R¹.0.50 per share for the financial year ended March 31, 2023 amounting Rs 25.46 million. The proposed dividend is subject to approval of sliareholders at tire ensuing Annual General Meeting.

Nature and purpose of reserves Securities Premium :

Securities premium is used to record the premium received on issue of shares and is utilised in accordance with the provisions of Companies Act, 2013.

Retained Earnings:-

Retained earnings represents undistributed profits of the Company which can be distributed to its equity shareholders in accordance with the provisions of the Companies Act, 2013.

Share options outstanding account:

The share option outstanding account has been created in accordance with the approved Employee Stock Option Scheme.

Nature of security and terms of repayment for borrowings:

(A) Secured Term loans (1) Term Loans from Banks (a) Security Terms

(i) Indian Bank OECLS-Covid-19 Loan amounting to Rs 2 94 millions (March 31. 2022 Rs 4.84 millions. April 01. 2021 Rs.5.86 millions) earning interest rate of Repo Rate Spread 2% per annum and is repayable in monthly equal installments. The loan is secured by Pari pasu charge with HDFC bank o\cr the assets to be created out of the loan proceeds on industrial unit (land & proposed building) at Plot H-l. Sector - 57. Fandabad Industrial Tow n (FIT). Faridabad. Haryana, in the name of the company, measuring 540.31 Sq yards . Pledge of FDR (excluding BG margin) of the Company and Personal Guarantee and residential properties proxidcd by Mr Sanjay Lodha (Director of Company). Mr Vi\ck l.odha (Director of Company). Mr Navin Lodha (Director of Company). Mr Niraj Lodha (Director of Company). Ms Madhuri Lodha ( Mortgagor Guarantor) (Relative of Director). Ms Priti Lodha ( VV/o Mr Sanjay Lodha ) (upto febmary 21. 2023) and Ms Sxxcta Lodha ( W/o Mr Navin Lodha) (upto february 21. 2023)

(ii) Term loan from Indian Bank for the construction of building amounting to Rs 14.38 millions (March 31. 2022: Nil April 01. 2021 Nil) carrying interest rate of Repo Rate • Spread 2% per annum, is secured by pari pasu charge with HDFC Bank o\cr industrial unit (land & proposed building) at Plot H-2. Sector - 57. Fandabad Industrial Town (FIT). Faridabad. Haryana, in the name of the company, measuring 540.31 Sq yards, along with the hypothecation of Fixed Assets of the company and Personal Guarantee cum residential properties provided by Mr. Sanjay Lodha (Director of Company). Mr Vivck Lodha (Director of Company). Mr. Navin Lodha (Director of Company). Mr. Niraj Lodha (Director of Company). Ms Madhuri Lodha ( Mortgagor Guarantor) (Relative of Director). Ms Priti Lodha ( W/o Mr Sanjay Lodha )(Personal Guarantee) (upto February 21. 2023) and Ms Sweta Lodha ( W/o Mr Navin Lodha)(Personal Guarantee) (upto February 21. 2023)

(in) Working Capital Term Loan under GECLS 1.0 (extension) from Indian Bank amounting to Rs 22.20 millions (March 31. 2022 Rs 22.20 millions: April 01. 2021: Nil) carry ing interest rate of Repo Rate Spread 2% per annum and is repayable in monthly equal installments The loan is secured by pari pasu charge with HDFC Bank o\cr the assets to be created out of the loan proceeds, on industrial unit (land & proposed building) at Plot H-l. Sector - 57. Faridabad Industrial Town (FIT). Faridabad. Haryana, in the name of the company, measuring 540.31 Sq yards . Pledge of FDR (excluding BG margin) of the Company and 100% guarantee co\cr of National Credit Guarantee Trustee Company Limited (NCGTC).

(iv) Term Loan from Indian Bank amounting to Nil (March 31. 2022: Nil: Apnl 01. 2021 Rs 2.36 millions) earning interest rate of repo rate 6.50% per annum and is repayable in monthly equal installments The loan is secured by the exclusive charge oxer EM of industrial unit (land & proposed building) at Plot H-l. Sector - 57. Faridabad Industrial Town (FIT). Fandabad. Haryana, in the name of the company, nicasunng 540.31 Sq yards, along with the hypothecation of Fixed Assets of the company and Personal Guarantee proxidcd by Mr Sanjay Lodha (Director of Company). Mr Vivck Lodha (Director of Company). Mr Navin Lodha (Director of Company). Mr Niraj Lodha (Director ofCompany). Ms. Madhuri Lodha ( Mortgagor Guarantor) (Rclatixe of Director). Ms Priti Lodha ( W/o Mr.Sanjay Lodha ) and Ms Sxxcta Lodha ( W/o Mr Navin Lodha).

(x) Indian Bank Coxid Emergency Credit line amounting to Nil (March 31. 2022 Nil. April 01. 2021: Rs 5.00 millions) carrying interest rate of 8 75% (fixed) per annum and is repayable in monthly equal installments Hie loan is secured by cxclusixc charge oxer the assets to be created out of the loan proceeds, exclusive charge over EM of industrial unit (land & proposed building) at Plot H-l. Sector - 57. Fandabad Industnal Toxxn (FIT). Fandabad. Haryana, in the name of the company, nicasunng 540.31 Sq yards . Pledge of FDR (excluding BG margin) of the Company and Personal Guarantee provided by Mr Sanjay Lodha (Director of Company ). Mr. Vivck Lodha (Director ofCompany). Mr Navin Lodha (Director ofCompany). Mr Niraj Lodha (Director ofCompany). Ms. Madhuri Lodha ( Mortgagor Guarantor) (Rclatixe of Director). Ms Priti Lodha ( W/o Mr.Sanjay Lodha ) and Ms Sxxcta Lodha ( W/o Mr Navin Lodha).

(i) In Case of HDFC Bank Limited. Personal Guarantee proxided by Navin Lodha (Director of Company) and Vivck Lodha (Director ofCompany)

(ii) In Case of Full^non India Credit Co Ltd. Personal Guarantee pro\idcd by Navin Lodha ( Co-borrower) (Director ofCompany).

(iii) In Case of IClO Bank Limited. Personal Guarantee pro\ ided by Sanjay Lodha ( co-applicant ) (Director of Company). Na\in Lodha ( co-applicant)(Director ofCompany). Niraj Lodha ( Co-Applicant/ Guarantor) (Director ofCompany). Vi\ek Lodha ( Co-Applicant/ Gu£>^rintor) (Director ofCompany). Sxxeta Lodha ( Co-applicant) (Relatixe of Director ofCompany) and Madhuri Lodha ( Co-applicant) (Relatixe of Director of Company)

(ix) In Case of IDF^ First Bank Limited. Personal Guarantee provided by Madhuri Lodlia ( Co-Applicant) (Relative of Director ofCompany). Navin Lodha ( Co-Applicant) (Director ofCompany). Niraj Lodha ( Co-Applicant) (Director ofCompany). Sanjay Lodha ( Co-Applicant) (Director ofCompany) and Sweta Lodha ( Co-Applicant) (Relative of Director ofCompany)

(v) In Case of YES Bank Limited. Personal Guarantee proxided by Sanjay Lodha ( Co-Borrow cr) (Director ofCompany). Navin Lodha ( Co-Borrower) (Director ofCompany). Vi\ck Lodha ( Co-Bonoxxcr) (Director ofCompany). Niraj Lodha ( Co-Borrower) (Director ofCompany). Madhuri Lodha( Co-Borrower) (Relatixe of Director ofCompany) and Sxxeta Lodha ( Co-Borroxxer) (Relatixe of Director ofCompany)

Note:

* Cash credit from Indian Bank amounting to Rs. 151.32 Millions (March 31. 2022: 178.42 Millions; April 01. 2021 Rs 129.50 Millions) is secured against Pari pasu charge on stock. Book debts and other current assets of the Company , both present and future xxith HDFC bank

Further CC Limit arc secured against (i) Properties of directors of the Company (ii) Pledge of FDR (excluding BG margin) of the Company (iii) Pari pasu charge on industrial unit (land & building) at Plot H-l. Sector - 57. Fandabad Industrial Toxxn (FIT). Fandabad. Haryana, in the name of the company, measuring 540.31 Sq yards, along xxith the hypothecation of Fixed Assets of the company as a collateral Security (iv) Pari pasu charge on industrial unit (land & Proposed building) at Plot H-2. Sector - 57. Faridabad Industrial Toxxn (FIT). Fandabad. Haryana, in the name of the company, measuring 540.31 Sq yards, along xxith the hypothecation of Fixed Assets of the company (After liquidation of Term Loan . the property will be held as collateral for working capital facility) as a collateral Security (v) Personal Guarantee proxided by Mr Sanjay Lodha (Director ofCompany). Mr Vivck Lodha (Director ofCompany). Mr Navin Lodha (Director ofCompany). Mr Niraj Lodha (Director ofCompany). Ms Madhun Lodlia ( Mortgagor Guarantor) (Relatixe of Director). Ms Pnti Lodha ( W/o Mr Sanjay Lodha ) (upto February 21. 2023) and Ms Sxxeta Lodha ( W/o Mr. Navin Lodlia) (upto febmary 21. 2023) xxith HDFC bank Interest rate on the above loans outstanding as at the year ended March 31. 2023 is Repo Rate 2%.

2 Cash credit from HDFC Bank amounting to Rs 40 84 Millions (March 31. 2022: Nil. April 01. 2021 Nil) is secured against Pari pasu charge on current assets, movable and inimoxable fixed assets xxith Indian Bank

Further CC Limit arc secured against (i) Properties of directors of the Company (ii) Pledge of FDR (excluding BG margin) of the Company (iii) Pan pasu charge oxer industrial unit (land & building) at Plot H-l. Sector - 57. Faridabad Industrial Toxxn (FIT). Faridabad. Haryana, in the name of the company, measuring 540.31 Sq yards, (ix) Pan pasu charge of industrial unit (land & Proposed building) at Plot H-2. Sector - 57. Faridabad Industrial Toxxn(FIT). Faridabad. Haryana, in the name of the company, measuring 540 31 Sq yards as a collateral Security (v) Personal Guarantee proxided by Mr Sanjay Lodha (Director ofCompany). Mr Vixek Lodha (Director of Company). Mr Navin Lodha (Director ofCompany). Mr. Niraj Lodha (Director ofCompany) and Ms Madhuri Lodlia ( Mortgagor Guarantor) (Relatixe of Director) xxith Indian Bank Interest rate on the above loans outstanding as at the year ended 31st March 2023 is 3M T-Bill 1.86%.

’During (he financial year ended March 31,2023 (he company has incurred INR 2 59 million (31 March 2022 Nil) towards service received from (he auditors of the Company in relation to the proposed Initial Public Offering (IPO) The same was not charged off to the statement of profit and loss and was disclosed in 'Other current assets"

36 Income tax

The Company subject to income tax in India on the basis of financial statements Business loss can be carried forward for a maximum period of eight assessment years immediately succeeding the assessment year to which the loss pertains Unabsorbed depreciation can be carried forward for an indefinite period

Pursuant to th<? Taxation Law (Amendment) Ordinance, 2019 ('Ordinance') issued by Ministry of Law and Justice (Legislative Department) on September 20, 2019 which is effective from April I, 2019, domestic companies have the option to pay income tax at 22% plus applicable surcharge and cess ('new tax regime ) subject to certain conditions The Company based on the current projections has chosen to adopt the reduced rates of tax as per the Income Tax Act, 1961 from the financial year 2019-20 and accordingly the Company has accounted deferred tax based on the reduced applicable tax rates

37 Earnings per share (‘EPS’)

Basic EPS amounts are calculated by dividing the profit / loss for the year attributable to equity shareholders of the Company by the weighted average number of equity shares outstanding during the year Partly paid equity shares are treated as a fraction of an equity share to the extent that they were entitled to participate in dividends relative to a fully paid equity share during the reporting year

Diluted EPS amounts are calculated by dividing the profit attributable to equity shareholders by the weighted average number of equity shares outstanding during the year plus the weighted average number of equity shares that would be issued on conversion of all the dilutive potential equity shares into equity shares

b) Defined benefit plans

The Company has a defined benefit gratuity plan. The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the act, every employee who has completed five years or more ot service gets gratuity on departure at 15 days salary' (last drawn salary) for each completed year of service. The level of benefits provided depends on the member’s length of service and salary at retirement age. The Gratuity plan is unfunded.

Ihe following tables summarise the components of net benefit expense recognised in the statement of profit or loss and amounts recognised in the balance sheet for gratuity benefit:

* Assumptions regarding future mortality are set based on actuarial advice in accordance with published statistics (i.e. IALM 2012-14 Ultimate). These assumptions translate into an average life expectancy in years at retirement age

Risk Exposure

i) Plan Characteristics and Associated Risks:

The Gratuity scheme is a Defined Benefit Plan that provides for a lump sum payment made on exit either by way of retirement, death or disability. The benefits are defined on the basis of final salary'and the period of service and paid as lump sum at exit. The Plan design means the risks commonly affecting the liabilities and the financial results are expected to be:

a) Discount rate risk : The discount rate is generally based upon the market yields available on Government bonds at the accounting date relevant to currency of benefit payments for a term that matches the liabilities.

b) Salary Growth risk : Salary growth rate is enterprise’s long term best estimate as to salary increases & takes account of inflation, seniority, promotion, business plan, HR policy and other relevant factors on long term basis.

c) Demographic risks: Attrition rates are the enterprise’s best estimate of employee turnover in future determined considering factors such as nature of business & industry, retention policy, demand & supply in employment market, standing of The Enterprise, business plan, HR Policy etc.

The above sensitivity analysis are based on a change in an assumption while holding all others assumptions constant. In the event of change in more than one assumption, the impact would be different than the stated above. The methods and any types of assumptions used in preparing the sensitivity analysis did not change compared to prior period.

40 Segment Sporting

Segments ^a'e identified in line with Ind AS-108, "Operating Segment" [specified under the section 133 of the Companies Act 2013 (the Act)] read with Companies (Indian Accounting Standards ) Rule 2015 (as amended from time to time) and other relevant provision of the Act, taking into consideration the internal organisation and management structure as well as differential risk and return of the segment. Based on above, as the company is engaged in the business of manufacturing and sale of computer servers and there is other operating revenue ir» *he form of AMC and related services. Accordingly, the Company has identified "Computer server" as the only primary reportable segment. The Company does not have any geographical segment as the Company mainly operates from single geographical location, primarily within India and the volume of exports is not significant. Hence no separate disclosures are provided in these financial statements.

Non-currCjit assets by geographical area

All non current assets of the Company are located in India

Information about maior customers

There is tvvocustomer (March 31, 2022: one customer) which amounts to 10% or more to the Company's revenue.

41 Leases a) Leases

I Company as a lessee

The Company has lease contracts for office facilities The lease term of the office facilities is generally I - 9 years The Company’s obligations under its leases are secured by the lessor’s tit leto the leased assets.

The Company also has certain leases of office facilities and office Equipments with low value or tenure less than 1 year. The Company applies the ‘lease of low-value assets’/ ‘short term lease ’recognition exemptions for these leases.

The Company has lease contracts that include extension and termination options. The Company applies judgement in evaluating whether it is reasonably certain whether or not to exercise the option to renew or terminate the lease. That is, it considers all relevant factors that create an economic incentive for it to exercise either the renewal or termination. After the commencement date, the Company reassesses the lease term if there is a significant event or change in circumstances that is within its control and affects its ability to exercise or not to exercise the option to renew or to terminate (eg., construction of significant leasehold improvements or significant customisation to the leased asset).

(ii) Contingent liabilities

In the ordinary course of business, the Company faces claims and assertions by various parties. The Company assesses such claims and assertions and monitors the legal environment on an ongoing basis with the assistance of external legal counsel, wherever necessary. The Company records a liability for any claims where a potential loss is probable and capable of being estimated and discloses such matters in its financial statements, if material. For potential losses that are considered possible, but not probable, the Company provides disclosure in the financial statements but does not record a liability in its accounts unless the loss becomes probable.

The following is a description of claims and assertions where a potential loss is possible, but not probable. The Company believes that none of the contingencies described below would have a material adverse effect on the Company’s financial condition, results of operations or cash flows.

43 Capital iV^nagement

The Company’s capital management is intended to maximise the return to shareholders for meeting the long-term and short-term goals of the Company through the optimization of the debt and equity balance.

The Company determines the amount of capital required on the basis of annual and long-term operating plans and strategic investment plans. The funding requirements are met through eC^bty and long-term/short-term borrowings. The Company monitors the capital structure on the basis of Net debt to equity ratio and maturity profile of the overall debt portfolio c?bhe Company.

For the pu^se of capital management, capital includes issued equity capital, securities premium and all other reserves attributable to the equity shareholders of the Company.

Net debt i deludes all long and short-term borrowings as reduced by cash and cash equivalents.

b) Fair value hierarchy

All financial assets and liabilities for which fair value is measured in the financial statements are categorised within the fair value hierarchy, described as follows -Level I - Quoted prices in active markets

Level 2 - Inputs other than quoted prices included within Level I that are observable, either directly or indirectly Level 3 - Inputs that are not based on observable market data

There are no Assets or Liabilities which are required to be measured at FVTPL/FVTOC1 Accordingly no disclosure required for Fair value hierarchy There are no transfers between level I, level 2 and level 3 during the year

The carrying amount of financial assets and financial liabilities measured at amortized cost in the financial statements are a reasonable approximation of their fair values since the Company does not anticipate that the carrying amounts would be significantly different from the values that would eventually be received or settled

45 Financial risk management objectives and policies

The Company’s activities are exposed to a variety of financial risks from its operations The key financial risks include market risk (including foreign currency risk and interest rate risk), credit risk and liquidity risk

The Company ’s senior management oversees the management of these risks The management is responsible for formulating an appropriate financial risk governance framework tor the Company and for periodically reviewing the same The senior management ensures that financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives The Board of Directors reviews and agrees policies for managing each of these risks, which are summarized below

(1) Market risk

Market risk is the risk of any loss in future earnings, in realisable fair values or in future cash flows that may result from a change in the price of a financial instrument. The value ot a financial instrument may change as a result of changes in interest rates, foreign currency exchange rates, equity price fluctuations, liquidity and other market changes Future specific market movements cannot be normally predicted with reasonable accuracy (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 Company's exposure to the risk of changes in market interest rates relates primarily to the Company’s debt obligations with floating interest rates

c) Market risk- Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates Foreign currency sensitivity

(2) Credit risk

Credit risk 1^ the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss Financial instruments that are subject to credit risK and concentration thereof principally consist of trade receivables

Customer cr"^edit risk is managed by Company’s established policy, procedures and control relating to customer credit risk management An impairment analysis is performed at each reporting daon an individual basis for major customers The Company does not hold collateral as security Further, trade receivables contribution to approximately 75% to 93% of the customer of the Company are due for less than 180 days during each reporting period The company majorly deals with government authorities and agencies which further reduces the credit risk of the company

With respect to Trade receivables, the Company has constituted the terms to review the receivables on periodic basis and to take necessary mitigations, wherever required The Company crates allowance for all unsecured receivables based on lifetime expected credit loss based on a provision matrix The provision matrix takes into account historical credit loss experience and is adjusted for forward looking information The expected credit loss allowance is based on the ageing of the receivables that are due and rates used in the provision matrix.

49 Other Statutory Information

(i) The Company docs not haw any Bcnanu property. where any |>roccvding has been initiated or pending against the Company for holding any Bcnaim property under the Bcnami Transactions (Prohibition) Act. 1988 and rules made thereunder

(ii) The Company did not haw any material transaction with companies struck olT under Section 248 of the Companies Act. 2013 or Section 560 of Companies Act. 1956 during the respccliw reported financial year (lii) The Company does not haw any cliargcs or satisfaction which is yet to be registered with ROC beyond the statutory period

(iv) The Company has not traded or invested in Crypto currency or Virtual Currency

⁾ Ihe Company has not advanced i*r loaned or invested funds to any other person! s) *>r entity(is). including foreign entities (Intermediaries) with the understanding Oral 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 Ihe like to or on behalf of the Ultimate Beneficiaries

(vi) Ihe Company lias not received any fund from any persons) or entity (is), including foreign entities (funding Party > with the understanding (whether recorded in writing or otherwise) that the Company shall:

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

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

(Mi) The company does not haw any unrecorded transactions which haw been surrendered or disclosed as Income during the year in the tax assessment under the Income Tax Act. 1961 (viii) Ihe company is not declared wilful defaulter by any bank, financial institution or lender

(ix> During the war. no scheme of arrangements in relation to the company has been approved by the competent authority in terms of Section 232 to 237 of the Companies Acl.201.3 Accordingly, this clause is not applicable to the company

50 Code on Social Security

The Indian Parliament has approved the Code on Social Security, 2020 which may impact the employee benefit expenses of the Company Ihe elTbctiw date from which the changes are applicable is yet to be notified and the rules for quantifying the financial impact arc yet to be determined Ihe Company will give appropriate impact in the financial statements once the code becomes elVectiw and related rules to determine the financial impact are notified.

51 Production Linked Incentives

Netweb Technologies India Limited has been awarded Production Linked Incentive (I’Ll) Scheme for IT hardware (eligible product -Servers) vide approval letter no Il^;CI/Advisory/MeitY/PLmiW-221007029 dated 7th October 2022 under the PLI Scheme introduced by the Government of India vide gazetted Notification no CG-DL-E-03032021-225613 dated 03rd March 2021 and the 1*1,1 Guidelines issued thereunder, as amended from time to time Under such a scheme the company is eligible to get a certain percentage of their sales of eligible products as incentive and is valid from financial Year 2021-22 to 2024-25 The company has achieved threshold limits of both investment & sale as prescribed under the scheme for 1st Year i e f Y 21-22, and is eligible to claim incentive for the same in the f Y 22-23 In this regard, the company has filed a claim for FY 21-22, which is under approval process of the Ministry of Flectronics & Information Technology

52 Disclosure on E ^ployees Stock Options Scheme

a) ESOP Policy

Equity share-bas⁴^ payments to employees and other providing similar services are measured at the fair value of the equity instruments at the grant date Details regarding the determination of the fair value of equity-settled share-based payments transactions are out in notes to accounts

The fair value dc?^tCi™incd at the grant date of the equity-settled share based pavments is expensed on straight-line basis over the vesting period, based on the company’s estimate of equity instrument that will eventually vest, with a corresponding increase in equity At the end of each reporting period, the company rev ises its estimate of the number of equity instruments expected to vest The impact of the revision of original estimates, if am. is recognised in the Statement of Profit and Loss such that the cuiT'ulative expenses reflects the revised estimate, with a corresponding adjustment to the Share Option Outstanding Account

b) ESOP Disclosure Details of schen#^e:

The Companv ad°ptcd the ESOP Scheme "Netvveb- Employee Stock Option Plan 2023" pursuant to resolutions passed by Board of Directors of the Companv at their meeting held on December 24. 2022 and by Shareholders of the Companv at their meeting held on .January 09,2023 and as amended bv the Board of Directors of the Companv at their meeting held on February 20. 2023 and approved bv the Shareholders of the Companv at their meeting held on February 23. 2023 The Plan has been made effectfrom January 21. 2023

The Plan provides for grant of stock options, wherein one stock option would entitle the holder of the option a right to apply for one equity share of the company upon fulfilment of vesting conditions prescribed in the Plan

The stock option^ granted to each eligible employee shall vest over a period of 3 y ears with equal vesting from the grant date The eligible employees shall be entitled to exercise the vested options within the exercise period The Exercise price of the stock options graced is INR 2

The details of grants approved for employees of the Company in accordance with the Employee Stock Option Scheme

53 First tir*¹® adoption of Ind AS

Upto the Financial year ended March 31,2022. the Company prepared its financial statements in accordance with accounting standards notified under the Section 133 of the Act, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (“Indian GAAP" or “Previous GAAP”)

The financial statement for the period ended 31 March 2023 is the first set of Financial Statements prepared in accordance with the requirements of IND AS 101 - First time adoption oflndian Accounting Standards Accordingly, the transition date to IND AS is 01 April 2021

Ind AS Financial Statements as at and for the year ended 31 March 2022 have been prepared after making suitable adjustments to the accounting heads from their Indian GAAP values following accounting policies accounting policy choices (both mandatory exceptions and optional exemptions availed as per Ind AS 101) consistent with that used at the date of transition to Ind AS (01 April 2021) and as per the presentation, accounting policies and grouping/classifications including revised Schedule III disclosures followed as at and for the year ended 31 March 2023

The impact of above to the equity as at 31 March 2022 and I April 2021 (Opening balance sheet date) and on total comprehensive income for the year ended 31 March 2022 has been explained as under

(A) Exemptions availed on first time adoption oflnd AS

Ind AS I 01, First-time Adoption oflndian Accounting Standards, allows first-time adopters certain exemptions from the retrospective application of certain requirements under Ind AS The Company has accordingly applied the following exemptions

i) Deemed Cost

Since there is no change in the functional currency, the Company has elected to continue with carrying value for all of its property, plant and equipment as recognized in its Indian GAAP financial statements as its deemed cost at the date of transition after making adjustments for decommissioning liabilities This exemption can also be used for intangible assets covered by Ind AS 38, Intangible Assets and investment properties Accordingly the management has elected to measure all of its property, plant and equipment and intangible assets at their Indian GAAP carrying value

ii) Leases

Ind AS - 116 is applied with Full retrospective approach, the Company has identified leases since the inception of all lease contracts that are presented in the financial statements, and has restated the comparative years presented

The Company also applied the available practical expedients wherein it

- has used a single discount rate for leases in India to a portfolio of leases with reasonably similar characteristics

- has elected to apply short term lease exemption to leases for which the lease term ends within 12 months of the date of initial application

- has excluded the initial direct costs from the measurement of the right-of-use asset at the date of initial application

(B) Mandatory Exemption on first-time adoption of Ind AS

i) Estimates

An entity’sestimates in accordance with Ind AS at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with Indian GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error

Ind AS estimates are consistent with the estimates as at the same date made in conformity with Indian GAAP The Company made estimates for following items in accordance with Ind AS at the date of transition as these were not required under Indian GAAP:

(i) Impairment of financial assets based on expected credit loss model

(ii) Fair valuation of Non-current Investments

(iii) Effective interest rate used in calculation of security deposit and retention money

ii) Derecognition of financial assets and financial liabilities

A first-time adopter should apply the derecognition requirements in Ind AS 109, Financial Instruments, prospectively to transactions occurring on or after the date of transition Therefore, if a first-time adopter derecognized non-derivative financial assets or non-derivative financial liabilities under its Indian GAAP as a result of a transaction that occurred before the date of transition, it should not recognize those financial assets and liabilities under Ind AS (unless they qualify for recognition as a result of a later transaction or event) A first-time adopter that wants to apply the derecognition requirements in Ind AS 109,Financial Instruments, retrospectively from a date of the entity's choosing may only do so, provided that the information needed to apply Ind AS 109,Financial Instalments, to financial assets and financial liabilities derecognized as a result of past transactions was obtained at the time of initially accounting for those transactions.

The Company has elected to apply the de-recognize provisions of Ind AS 109 prospectively from the date of transition to Ind AS

ni) Classification and measurement of financial assets

Ind AS 101, First-time Adoption oflndian Accounting Standards, requires an entity to assess classification and measurement of financial assets (investment in debt instruments) on the basis of the facts and circumstances that exist at the date of transition to Ind AS

(C) Reconciliations

The following reconciliations provides the effect of transition to Ind AS from Indian GAAP in accordance with Ind AS 101, First-time Adoption oflndian Accounting Standards

A Prior P*?^riotl Adjustments

The Cor^Pany has made certain errors in adoption of accounting policies under Previous GAAP During the current year, on transition to IndAS. the Company has rectified these errors AI Revenue recognition for sale of goods w r t to cut-off and service revenue with respect of time proportionate booking of revenue A2 Cut-off procedures in respect of purchases A3 Measure?^ent and recording of inventory

A4 Recogni t*on and measurement of post employment defined benefits A5 Accrual and booking of certain expenses A6 Measurement of exchange (gain) / loss

A7 Effect of”temporary differences arising due to above mentioned adjustments A8 Adjustrr»^cni on account of short/excess provision for Tax

B On account of implementation of IND AS B1 Re-mei*^surenicnt of post employment benefit plans

Under the Indian GAAP, actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability was forming part of the profit or loss for the year However under Ind AS 19, it is recognised in other comprehensive income As a result of this change gains/ losses recognised in the statement of profit and loss under the Indian GAAP has been transferred to other comprehensive income upon transition B2 Lease accounting

Under the Indian GAAP, lease rentals related to operating lease were accounted as expense in the statement of profit and loss Under Ind AS, lease liability and right of use is recorded at present value of future contractual rent payment on initial date of lease Subsequently, finance cost is accrued on lease liability and lease payments are recorded by way of reduction in lease liability ROU is depreciated over lease term

B3 Expected credit loss

Under the Indian GAAP, the Company had assessed provision for impairment of receivables based on the incurred loss model and no provision was created Under Ind AS, impairment loss has been determined as per Expected credit loss (F.CL) model The provision amount as per Ind AS - ECL is recognised in retained earnings on date of transition and subsequently in the statement of profit and loss account.

B4 Impact on account of fair valuation of interest free security deposits and retention Money

Under the Indian GAAP, interest free refundable security deposits (given) and retention money were accounted at their transaction value Under Ind AS, all financial assets are required to be recognised at fair value On the date of initial recognition, in case of security deposits the difference between the transaction amount and the fair value has been recognised as ROU The security deposits and retention money have been subsequently amortised under effective interest rate method and the ROU on a straight line basis over the term of contract

B5 Current tax

Under the Indian GAAP financial statements, the company had identified errors in accounting of earlier year tax adjustments and had accounted as prior period items in the year in which the errors were identified Under IND AS, the errors are to be adjusted in the year in which the error has been done or in the first period presented Accordingly, the company has adjusted the errors in respective financial years in which accounting error were identified

B6 Deferred tax

Deferred tax adjustments has been made in accordance w ith Ind AS, under balance sheet approach for all the items which have differential book base from that of tax base and which temporarily gets reversed due to timing difference including adjustments arising from Ind AS transition

Under the Indian GAAP, the Company had not recognised deferred tax assets The Company has evaluated the carrying amount of deferred tax and it has envisaged that it will earn sufficient taxable profit Ijj that will be available to allow all of the deferred tax asset to be utilized

Accordingly deferred tax assets has been recognised in the restated financial information B7 Other comprehensive income

Under Ind AS, all items of income and expense recognised in a period should be included in profit and loss for the period, unless a standard requires or permits otherwise Items of income and expense that are not recognised in profit and loss but in other comprehensive income under "Statements of Profit and Loss (including other comprehensive income)" includes re-measurements of defined benefit plans and their corresponding income tax effects The concept of other comprehensive income did not exist under Previous GAAP B8 The transition from the Previous GAAP to Ind AS did not have material impact on the statement of cash flow, except for payment of lease liabilities, which were forming part of operating activity under Previous GAAP and are now included under financing activity

B9 Appropriate adjustments have been made in the Balance Sheet, Statement of Profits and Loss and Statement of Cash Flows, wherever required, by a reclassification of the corresponding items of income, expenses, assets, liabilities and cash flows in order to bring them in line with the groupings as per the audited Ind AS financial statements of the Company prepared in accordance with Schedule III of Companies Act 2013

1

Previous year figures of number of shares hare been recaste,/due lo split of shares. Further, current year figures of number of shares are pursuant to impact of split of shares from face value ofRs. 10 to Rs 2 per share and issue of bonus shares.