(K) Provisions
Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past
event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation
and a reliable estimate can be made of the amount of the obligation. Provisions are measured at the best estimate
of the expenditure required to settle the present obligation at the Balance Sheet date.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that
reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision
due to the passage of time is recognised as a finance cost.
Provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimate. If it is no
longer probable that the outflow of resources would be required to settle the obligation, the provision is reversed.
(L) Taxation
(i) Current income tax
Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to
the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or
substantively enacted, at the reporting date.
Income tax expense for the year comprises of current tax and deferred tax. It is recognised in the standalone
statement of profit and loss except to the extent it relates to a business combination or to an item which is
recognised directly in equity or in other comprehensive income. Management periodically evaluates positions
taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation
and adjust provisions accordingly where ever appropriate.
(ii) Deferred tax
Deferred tax is recognised on temporary differences between the tax bases of assets and liabilities and their
carrying amounts for financial reporting purposes at the reporting date.
Deferred tax liabilities are recognised for all taxable temporary differences, except when it is probable that the
temporary differences will not reverse in the foreseeable future.
Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax
credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that
taxable profit will be available against which the deductible temporary differences, and the carry forward of
unused tax credits and unused tax losses can be utilized.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that
it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset
to be utilised. Unrecognised deferred tax assets are re-assessed at each reporting date and are recognised to
the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when
the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or
substantively enacted at the reporting date.
Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current
tax assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same
taxation authority.
Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which gives future economic benefits in
the form of adjustment to future income tax liability, is considered as an asset if there is convincing evidence
that the Company will pay normal income tax. Accordingly, MAT is recognised as an asset in the Balance
Sheet when it is probable that future economic benefit associated with it will flow to the Company.
(M) Employee Benefits
(i) Short term employee benefits
All employee benefits payable wholly within twelve months of rendering the service are classified as short term
employee benefits. Benefits such as salaries and performance incentives, are charged to standalone statement
of profit and loss on an undiscounted, accrual basis during the period of service rendered by the employees in
the financial year.
(ii) Defined Contribution Plans:
Contributions to defined contribution schemes such as employees’ state insurance, labour welfare fund,
superannuation scheme, employee pension scheme etc. are charged as an expense based on the amount of
contribution required to be made as and when services are rendered by the employees. Company”s contribution
to provident fund is made to Government Administered Fund. The above benefits are classified as Defined
Contribution Schemes as the Company has no further defined obligations beyond the monthly contributions.
(iii) Defined benefit plans
Company has an obligation towards gratuity, a defined benefit retirement plan covering all employees. The
plan provides for a lumpsum payment to employees at retirement/determination of service on the basis of 15
days terminal salary for each completed year of service subject to maximum amount of Rs. 20 Lacs.
Company’s liability towards gratuity and compensated absences is determined using the projected unit credit
method, with actuarial valuations being carried out at the end of each annual reporting period by independent
actuary. Remeasurement, comprising actuarial gains and losses, the effect of the changes, is reflected
immediately in the balance sheet with a charge or credit recognized in other comprehensive income (OCI) in
the period in which they occur. Remeasurement recognized in the other comprehensive income is reflected
immediately in retained earnings and is not reclassified to profit or loss.
The classification of the Company’s net obligation into current and non-current is as per the actuarial valuation
report. Refer Note 35 for Employee benefit plan calculations.
(iv) Share Based Payments
Employees of the Company receive remuneration in the form of share-based payments in consideration of the
services rendered.
For cash-settled share-based payments, the fair value of the amount payable is recognised as ‘employee
benefit expenses’ with a corresponding increase in liabilities, over the period of non-market vesting conditions
getting fulfilled. The liability is remeasured at each reporting period up to, and including the settlement date,
with changes in fair value recognized in employee benefits expenses.
Under the equity settled share based payment, the fair value of Rs 318 lakhs on the grant date of the awards
given to employees required to be recognized under Ind AS 102. as ‘employee benefit expenses’ with a
corresponding increase in equity over the vesting period is netted off against other income resulting in no
impact on profit before tax. (Refer note 24(i)(e)) When the options are exercised, the Company issues fresh
equity shares.
(v) Impact of New Labour Code
On 21 st November 2025, the Government of India notified the four Labour Codes - the Code on Wages, 2019,
the Industrial Relations Code, 2020, the Code on Social Security, 2020, and the Occupational Safety, Health
and Working Conditions Code, 2020 - consolidating 29 existing labour laws. The Ministry of Labour &
Employment published draft Central Rules and FAQs to enable assessment of the financial impact due to
changes in regulations. There is no material incremental impact in the gratuity and compensated absences
liability in financial statements as at 31.03.2026 due to change in definition of wages.
(N) Revenue RecognitionSale of Products/Services
As per Ind AS 115, Revenue from sale of goods is recognised when control of the products being sold is transferred
to customer and when there are no longer any unfulfilled obligations. The Performance Obligations in our contracts
are fulfilled at the time of dispatch, delivery or upon formal customer acceptance depending on terms with customers.
Revenue is measured on the basis of contracted price, after deduction of any trade discounts, volume rebates and
any taxes or duties collected on behalf of the Government such as Goods and Services Tax, etc. Accumulated
experience is used to estimate the provision for such discounts and volume rebates. Revenue is only recognised to
the extent that it is highly probable a significant reversal will not occur.
Sales return - Our customers have the contractual right to return goods only when authorised by the Company. Sale
returns are accounted on actual receipt of goods from the customers.
The entire revenue from sale of products is recognised at a point in time.
Specific recognition criteria described below must also be met before revenue is recognized.
(a) Conversion charges are recognized on completion of jobs and based on agreements as the service is performed
and there are no unfulfilled obligations.
(b) Interest Income from financial asset is recorded on time proportion basis using the effective rate of Interest
(EIR).
(c) Carbon Credits are recognized on realization basis.
O) Earning per equity shares
The Company presents basic and diluted earnings per share (“EPS”) data for its equity shares.
Basic EPS is calculated by dividing the net profit for the period attributable to equity shareholders of the Company
by the weighted average number of equity shares outstanding during the period which is adjusted for such events,
such as bonus shares.
For the purpose of calculating Diluted EPS, net profit for the period attributable to equity shareholders and the
weighted average number of equity shares outstanding during the period is adjusted for the effects of all dilutive
potential equity shares. (Refer note 32)
P) Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating
decision maker. The Company’s Managing Director assesses the financial performance and position of the Company,
and makes strategic decision and has been identified as the chief operating decision maker. The Company’s primary
business segment is reflected based on principal business activities carried on by the Company. The company is
operating under a single segment i.e., “Dairy Products - comprising Ghee and Milk Powder and therefore there are
no reportable segments as per IND AS-108 “Operating Segments” issued under section 133 of Companies Act
2013 read with Companies (Indian Accounting Standards) Rules 2015.
The company has received 10% or more of its revenue from one customer during the year.
Q) Contingent liabilities
A contingent liability is a possible obligation that arises from past events and whose existence will be confirmed only
by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the
Company; or a present obligation that arises from past events but is not recognized because it is not probable that
an outflow of resources embodying economic benefits will be required to settle the obligation; or the amount of the
obligation cannot be measured with sufficient reliability. Therefore, determination of the amount to be recognised as
a liability or to be disclosed as a contingent liability, in each case, is inherently subjective, and needs careful evaluation
and judgement to be applied by the management.
In case of provision for litigations, the judgements involved are with respect to the potential exposure of each
litigation and the likelihood and/or timing of cash outflows from the company, and requires interpretation of laws and
past legal rulings. The Company does not recognize a contingent liability but discloses its existence in the standalone
financial statements.
Contingent assets are not recognised in the financial statements. However, contingent assets are assessed continually
and if it is virtually certain that an inflow of economic benefits will arise, the asset and related income are recognised
in the period in which the change occurs.
R) Use of Key Accounting estimates and judgments
The preparation of financial statements requires management to make estimates, judgements and assumptions in
the application of accounting policy that affect the reported amount of assets and liabilities on the date of financial
statements and the reported amount of revenues and expenses during the reporting period. Difference between the
actual results and estimates are recognised in the period in which it is known/materialised. Continuous evaluation is
done on the estimation and judgements based on historical experience and other factors, including expectations of
future events that are believed to be reasonable. Revisions to accounting estimates are recognised prospectively
except as described in note 24(i)(c) regarding reversal of depreciation.
In particular, information about significant areas of estimation, uncertainty and critical judgments in applying accounting
policies that have the most significant effect on the amounts recognized in the financial statements are included in
the following notes:
(i) Property, Plant and Equipment - Note 3A
(ii) Indefinite useful life of Intangible Assets - Note 3C
(iii) Recognition of deferred tax assets/liabilities - Note 31D
(iv) Measurement of defined benefit obligation - Note 35
(v) Measurement and likelihood of occurrence of provisions and contingencies - Note 34
(vi) Measurement of Right of Use Asset and Lease liabilities - Note 3D, 16A and 16B.
(vii) Measurement of fair value of biological assets—Note 4
(i) For details of Property, plant and equipment charged as security against borrowings. Refer Note 16(iii) & Note
19(i).
(ii) Title deeds of all immovable properties i.e. Land & Building at Bahadurgarh, Patiala in the name of Company are
held by banks as security.
(iii) Estimated amount of capital contracts remaining to be executed is Rs. 3 Lakhs (PY Rs. Nil).
(iv) * includes office equipment.
(v) During the year, the company has written off Property,Plant and Equipment worth Rs 17 Lakhs
(vi) Company has not revalued any PPE and ROU Assets during the year except Land at Patiala by Rs 3216 Lakhs
(refer note 24(i)(b)
Footnotes:
(i) Trees and plants are considered biological Assets as per Ind AS 41. During the year company has capitalised Rs. 8 lakhs
(P.Y Rs. 8 lakhs) towards lease rentals of land. Company has obtained the certificate of Agricultural Scientist with regard
to fair valuation at the reporting date and has accounted the gain of Rs. 106 lakhs on reinstatement during the year(
previous year 84 lakh) (refer note 24(c) Company has written off an amount of Rs 189 lakhs pertaining to Moradabad plant
on disposal of Land & building .Management hopes to generate revenue from the sale of trees in the subsequent years.
(Also refer Note 24A(i)(d)
i) In view of insignificant amount of bad debts and timely recovery in earlier years, allowance for expected credit loss is made
on the simplified approach of Actual bad debts in earlier years.
(ii) (a) Includes Rs 47 Lakhs (net of write off/ provisions of Rs 22 Lakhs) from an entity facing an insolvency petition before
theNCLT, a claim of Rs 78 Lakhs including interest of Rs 9 lakhs has been filed before the Resolution Professional.
The Company on the basis of legal advice, is of the view that it has good chance to recover the amount of claim. As a
matter of abundant caution, the amount of Rs 22 Lakhs as stated above has been written off/ provided in the books.
(b) Trade receivables of Rs 50 Lakhs outstanding for more than two years are considered recoverable.
iii) No trade receivables are due from directors or other officers of the company or any of them either severally or jointly with
any other person, or from firms or private companies in which any director is a partner, a director or a member. Refer note
36 (b) for information about credit risk .
(i) Represents the amount deposited as a pre-condition for preferring appeal, the matter is pending before Rajasthan Tax
Board. Company is of the view that the Appeal would be decided in its favour and hence no provision has been made.(Refer
Note 34(a)
(ii) Includes unconfirmed advances to suppliers of Rs 461 Lakhs outstanding from earlier years. However, the management is
hopeful of recovery of the same and as a matter of abundant caution, a provision of Rs 8 Lakhs has already been made in
the books.
Footnotes:
(i) Non moving / slow moving stocks of packing material, stores and spares of Rs 78 Lakhs have been written off, Refer
footnote 24(i)(c).
(ii) For details of inventories provided as security for borrowings. Refer Note 19(i)
(iii) The mode of valuation of inventories has been described in Note 2H of material accounting policies.
(i) Includes an amount of Rs. 199 Lakhs on GST Refund (Moradabad Plant) pending disposal of the appeal preferred by the
department.
(ii) Represent job work executed pending dispatch.
(iii) Represents amount receivable in terms of sale deed of the Moradabaad Plant which has been received subsequent to the
reporting date on execution of sale deed. Refer Note 24A(i)(a)
(iv) Includes Rs 28 lakhs given to employee towards Medical emergency considered good and recoverable.
(v) In line with circular no.04/ 2015 issued by MCA dated 10-3-2015, loans given to employees as per the Company’s policy
are not considered for the purpose of disclosure under section 186 (4) of the Companies Act,2013.
Footnotes:
(i) Represent GST input credit.
(ii) Against the demand of Rs 1896 lakhs with an equivalent amount of penalty levied by CGST Ludhiana in respect of Patiala
Plant in earlier years, confirmed by Commissionerate (Appeals), Company has preferred an appeal before Tribunal CGST
Ludhiana which is pending. The Company has been legally advised of its success as the facts of the Patiala Plant are
similar to that of the Moradabad Plant where the entire demand had been quashed by the appellate authority.
(i) The Company has only one class of equity shares having a face value of Re. 5 per share. Each holder of equity share is
eligible for one vote per share.
(ii) In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the
company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares
held by the shareholders.
(iii) Details of shares held by shareholder holding more than 5% of aggregate shares of the company.:
Footnotes:
(i) Securities Premium
The amount received in excess of face value of the equity shares is recognised in Securities Premium. In case of equity
settled share based payment transactios, the difference between the fair value on the grant date and nominal value of
shares is accounted as security premium. In case of business acquistions, the difference between the fair value on the
acquistion date and nominal value of shares is accounted as security premium. The company may issue fully paid-up
bonus shares to its members/ buy back of shares out of balance lying in the securities premium account .
(ii) Retained Earnings
Retained earnings are the profits that the Company has earned till date, less any transfers to general reserve, dividends or
other distributions paid to shareholders. Out of the total revlaution reserve of Rs 5,081 Lakhs created at the time of first
time adoption of Ind as on 01.04.2016, during the year, revalution reserve of Rs 4300 Lakhs has been withdrawn on
account of sale of Moradabad Plant. and the balance revaluation reserve of Rs. 763 lakhs (PY Rs. 5,081) pertains to
Patiala Plant. Further, During the year company has revalued the Patiala Plant and the surplus of Rs 3197 Lakhs has been
credited to retained earnings instead of Revalation Reserve,(refer Note 24A (i)(c). Items of other comprehensive income :
Remeasurement of Net Defined benefit plans represents changes in the liabilities over the year due to changes in the
acturial assumptions or experience adjustment within the plans are recognised in the other comprehensive income and are
adjusted to retained earnings.
(iii) Share Option Outstanding Account
The Fair value of equity settled share based payment transaction is recognised as expense in the standalone statement of
profit and loss with a corrosponding credit to Employee stock option outstanding account.
NRC vide resolution dated 28.05.2025 withdrew/ cancelled the ESOP Scheme 2024 on the request of the employees,
informed Bombay Stock Exchange and approved the amended Stock Incentive Plan on 20.06.2025 to the Eligible Employees/
Director of the company under the “Milkfood Ltd Employee Stock Option Plan 2024” complying the Companies Act read
with Securities and exchange Board of India (share based employee benefits and sweat equity regulations) 2021. The
vesting period is till 20.06.2026. Pursuant to the amended plan and the approval of the Nomination and Remuneration
Committee the company has granted options numbering the company has granted options numbering 12,18,000 (Fair
value Rs 409 Lakhs) during the year. Refer foot note (e) of note 24 (i).
(iv) Capital Reserve has been created in pursuance of scheme of amalgamation between Triputi Infrastructure Pvt Ltd (Transferor
Company) with Milkfood Ltd (Transferee Company). This reserve is not available for capitalisation/ declaration of dividend
and share buy back.
(v) The disaggregation of changes in each type of reserve, retained earnings and other comprehensive income are disclosed
in Statement of Changes in Equity.
(ii) Figures in bracket relates to the previous year. Interest rate above represent prevailing rates.
(iii) a) SBI Term Loan of Rs 1000 Lakhs was primarily secured on 1st pari pasu basis of entire current assets including stocks
of raw materials, stores, spares, Stock in Progress, Finished Goods, including goods in transit, book debts (etc.) and
collaterally secured by 1st pari passu charge through equitable mortgage of factory land and building located at
Bahadurgarh Patiala, hypothecation of Movable fixed assets of the company excluding vehicles and assets financed
by other lenders and charge over company’s Brand. Further the loan is guaranteed by the two individual promoters.
b) Canara Bank Term Loan of Rs 1000 Lakhs was primarily secured by 1st pari passu charge on entire current assets of
the Company including receivables and collaterally secured through pari pasu charge on equitable mortgage of factory
land and building located at Bahadurgarh Patiala - Punjab and hypothecation of Plant and Machinery.
(iv) Original Date of agreement: 08.08.2022, tenure 10 years, flexible at the option of borrower for earlier payment with a
floating rate of interest 10.25% p.a as mutually agreed. Rs 2755 Lakhs have been paid subsequently and hence considered
short term borrowings.
(v) The company has utilised the borrowings from banks and financial institutions for the specific purposes for which it was
taken.
(vi) There has been no default in respect of repayment of borrowings and interest. Company has not been declared as wilful
defaulter by any bank or financial institution or any other lender.
(vii) Represents the Loan from directors of the erstwhile merged company.
(viii) Vehicle loans are secured by endorsement in favour of lender on Registration certificate
(i) Company has treated a sum of Rs 901 Lakhs (previous year 1212 lakhs) payable to suppliers as security deposit received
as non current liability as per trade practice followed consistently in the past .During the year an amount of Rs 301 lakhs
has been written back as considered no longer payable (Refer Note 24(i)(c))
(ii) Payable to ex-employee pending final decision of court.
(iii) Refer note 36(c) for information about liquidity risk
(i) Cash Credit limit sanctioned by State Bank of India/Canara Bank are secured by hypothecation on pari passu basis on all
present & future current assets including stocks and book debts and extension of charge on pari-passu basis on the
Property,Plant and Equipment (excluding vehicles) of the company and exclusive charge on the Brand “MILKFOOD”.
Refer Note 16(iii).The facility is further guaranteed by two individual promoters.
(ii) The company has utilised the borrowings from banks and financial institutions for the specific purposes for which it was
taken.
(iii) Company has not been declared as wilful defaulter by any bank or financial institution or any other lender.
Footnote:
(i) This information as required to be disclosed under Micro Small and Medium Enterprise Development Act, 2006 has been
determined to the extent such parties have been identified on the basis of information available with the Company.
(ii) Disclosure as required by Micro, Small and Medium Enterprises Development Act, 2006
(i) (1) Recognised gain , basis agreement to sell, substantial receipt of consideration and handing over the possession prior
to the reporting date, despite the fact that Sale deed of Rs 9217 Lakhs executed subsequent to the reporting date,
considering the same to be adjusting events instead of non adjusting events in terms of Ind AS 10 and SA 560
resulting in increase in profit to that extent.
(i) (2) On account of retrospective revision of useful life of vehicle from 6 to 8 years from FY 2019-20 onwards instead of
prospective as per Ind AS 8 resulting in overstatement of profit before tax to the extent of Rs 251 Lakhs.
(i) (3) other Income is net of Share Based Payments instead of seperate classification in Employee benefit expense as per
Ind AS 102 with no impact on profit before tax.
Footnote:
(i) No amounts have been written off / provided for or written back during the year in respect of amounts receivable from or
payable to related parties. There have been no guarantee provided or received to/ from related party in respect of any debt/
obligation of the related party or of Company except personal guarantee given by two Individual promoters in respect of
secured loans from banks
(ii) Related parties have been identified by the management.
(iii) Rent (lease liability including interest) is certified by the the management as per prevalent market rates and for business
purposes of the company.
(iv) As the defined benefit plans and compensated absences are provided on actuarial basis for the company as a whole, the
amount pertaining to Key Managerial Personnel are not ascertainable and hence not included above.
(v) Related parties transactions are done in the ordinary course of business and are at arms length. Outstanding balances at
the year end are unsecured. Refer note 16(iv) for Terms and conditions of loans taken from related party.
vi) Figures in bracket relates to the previous year.
vii) Employer contribution to Provident fund on aggregate basis to KMP
(viii)An amount of Rs 20.07 Lakhs has been paid as retainership fees
Footnote
(i) *The company is contesting these demands and the management, based on advise of its legal Team, believes that its
position will likely be upheld in the appellate process. No expense has accrued in the standalone financial statements for
these demands raised. The management believes that the ultimate outcome of these proceedings will not have a material
adverse effect on the company’s financial position and results of operations. The company does not expect any
reimbursements in respect of the above contingent liabilities.
(ii) In addition, the company is subject to legal proceedings claims, which have arisen in the ordinary course of business. The
company’s management reasonably does not expect that outcome of these legal proceeding etc, when ultimately concluded
and determined, will have adverse material effect on the company’s results of operations or financial condition.
(iii) Basis GST department information, the Income Tax Department has re-opened the Assessment for Ay 2019-20 alleging
the escapement of Income of Rs 2,230 Lakhs. The Company has challenged the re-opening on the premise that all its
purchases are genuine,duly backed by necessary documentry evidences and is of the view that there would not be any tax
liability consequent upon the positive outcome of GST case which is pending before the Tribunal.
Note: 36. Financial risk management objectives and policies
The company’s principal financial liabilities comprise borrowings, Security Deposits Received, trade and other payables etc.
The main purpose of these financial liabilities is to finance the company’s operations. The company’s principal financial assets
include, trade and other receivables, cash and cash equivalents and security deposits that are out of regular business operations.
The Company’s activities expose it to a variety of financial risks namely credit risk, liquidity risk, market risk and other risks. In
order to manage the aforementioned risks, the Company operates a risk management policy and a program that performs
close monitoring of and responding to each risk factors. The company’s senior management oversees the management of
these risks. The key risks and mitigating actions are also placed before the Audit Committee of the Company.
(a) Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument that will fluctuate because of changes
in market prices. Market risk comprises three types of risk i.e. interest rate risk, currency risk and other price risk, such as
commodity risk. The objective of market risk management is to manage and control market risk exposures within acceptable
parameters, while optimising the return.
i. Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of the Company’s financial instruments will fluctuate
because of changes in market interest rates. The Company’s exposure to the risk of changes in market interest rate
relates primarily to the company’s borrowings with floating interest rates.
The following table demonstrates the sensitivity to a reasonably possible change in interest rates on borrowings
affected. With all other variables held constant, the company’s profit before tax is affected through the impact on
floating rate borrowings, as follows:
The impact of increase of 1 % in rate of interest would have been mitigated majorly by negotiating the interest rate on
long term substantial borrowing from the related party.
ii. 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. There does not seem to be any significant risk as transaction in foreign currency
are not there.
As there is no significant foreign currency risk, sensitivity analysis showing impact on profit is not calculated.
iii. Commodity price risk
The Prices of the raw material mainly loose ghee keep fluctuating frequently due to volatility in the prices of Raw Milk.
and the company tries to pass the same to the customers through appropriate adjustment to selling prices. The major
players both on supply chain of loose ghee and market chain of FG are in unorganised sector and at times the
company has to pay more for supply and receive less for sales. Company is trying to work on seamless chain of supply
and sales at most reasonable prices.
(b) Credit risk
Credit risk is the risk of loss that may arise on outstanding financial instruments if a counterparty default on its obligations.
The company’s exposure to credit risk arises majorly from trade and other receivables. Other financial assets like security
deposits and bank deposits are mostly with government authorities and nationalised banks and hence, the company does
not expect any credit risk with respect to these financial assets. In majority of cases of trade receivables are collected in
time. The trade receivables are subject to monthly review. Expected Credit Loss is too low considering the past record and
management does not foresee any significant change in near future. In view of insignificant credit risk sensitivity analysis
showing impact on profit is not calculated
(c) Liquidity risk
Liquidity risk is the risk that the Company will face in meeting its obligations associated with its financial liabilities. The
Company’s approach in managing liquidity is to ensure that it will have sufficient funds to meet its liabilities when due
without incurring unacceptable losses. In doing this, management considers both normal and stressed conditions. The
liquidity position remained under stress due to 8% fall in revenue from operations during the year resulting in negative cash
flow from operational activities. The position stood improved by the end of financial year upon disposal of MBD plant. The
table below summarises the maturity profile of the company’s financial assets & financial liabilities on the reporting date:
Note: 37. Capital management
The Company manages its capital to ensure that the Company will be able to continue as going concern and maximising the
return to shareholders through the optimisation of the debt and equity. For the purpose of the company’s capital management,
capital includes issued equity capital, securities premium and all other equity reserves attributable to the equity shareholders.
The company management/ Board monitors capital using a gearing ratio, which is net debt divided by total capital. The company
includes within net debt, all non-current and current borrowings reduced by cash and cash equivalents and other bank balances.
The Company manages its capital structure and makes adjustments in the light of changes in economic conditions and the
requirements of the financials covenants. To maintain or adjust the capital structure, the Company may adjust the level of
dividend payments to shareholders, return excess capital to shareholders , issue new shares or buy back shares. The capital
structure is monitored on the basis of net debt to equity and maturity profile of the overall debt portfolio of the Company as given
below:
In order to achieve this overall objective, the company’s capital management, amongst other things, aims to ensure that it
meets financial covenants attached to the interest-bearing borrowings that define capital structure requirements. The breaches
in meeting the financial covenants would permit the bank to immediately call borrowings. There have been no breaches in the
financial covenants of any interest-bearing borrowings in the current year.
No significant changes were made in the objectives, policies or processes for managing capital during the years ended March
31,2026 and March 31,2025 except that MBD plant was sold during the year and Land & Building at Patiala Plant was revalued
during the year.
Note 38. Fair value measurement
(i) All the financial assets and financial liabilities of the company are carried at amortised cost.
(ii) The management assessed that the carrying values of trade and other receivables, deposit, cash and short term deposits,
other assets, borrowings, trade and other payables reasonably approximate their fair values because these instruments
have short-term maturities.
(iii) It is view of the management that fair value impact of long term security deposits/loan paid or payable would not be
material.
40. Corporate social responsibility (CSR)
As per Section 135 of the Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at least 2% of
its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The
areas for CSR activities are defined in schedule VII of the Companies Act which inter- alia includes contribution to the Prime
Minister National Relief Fund, PM Cares Fund or any other fund set up by the Central Government for socio economic development
and relief and welfare of the scheduled castes, the scheduled tribes, other backward classes, minorities and women. A CSR
committee has been formed by the company as per the Act. The funds were primarily utilized through the year on these
activities which are specified in Schedule VII of the Companies Act, 2013.
Note 43: Relevant Additional Regulatory Information: (Other than disclosed in the respective notes)
(i) The operating cycle of the company is assumed to be of twelve months in absence of clearly identifiable normal operating
cycle and accordingly assets/ liabilities have been classified as current/ non current.
(ii) No proceedings have been initiated or pending against the company for holding any benami property under the Benami
Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made thereunder.
(iii) The Company has not done any transaction with struck off companies during the year.
(iv) There is no charge or satisfaction of any charge which is not registered with ROC beyond the statutory period.
(v) The company has not granted any loans or advances in the nature of loans to promoters, directors, KMP and the related
parties either severally or jointly with any other person which is either repayable on demand or without specifying any
terms or period of demand and therefore requirement of disclosure of such loan/ advance is not applicable.
(vi) The company has complied with the number of layers prescribed under clause (87) of section 2 of the act read with
companies (restriction on number of layers) rules 2017.
(vii) Company has not applied any accounting policy retrospectively or has made a restatement of items in FS or has reclassified
items in the FS.
(viii) The Company have not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign
entities (Intermediaries) with the understanding that the Intermediary shall:
a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of
the company (Ultimate Beneficiaries), or
b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries
(ix) The Company have not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with
the understanding (whether recorded in writing or otherwise) that the Company shall:a) directly or indirectly lend or invest
in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries),
or b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(x) The Company have not traded or invested in Crypto currency or Virtual Currency during the financial year.
(xi) The Company have not made any such transaction which is not recorded in the books of accounts that has been surrendered
or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey
or any other relevant provisions of the Income Tax Act,1961)
Note 44:
Previous year figures have been reclassified / regrouped wherever necessary to confirm with those of current year figures. The
impact of such reclassification/ regrouping is not material to the standalone Financial statements.
Note 45:
On 21st November 2025, the Government of India notified the four Labour Codes - the Code on Wages, 2019, the Industrial
Relations Code, 2020, the Code on Social Security, 2020, and the Occupational Safety, Health and Working Conditions Code,
2020 - consolidating 29 existing labour laws. The Ministry of Labour & Employment published draft Central Rules and FAQs to
enable assessment of the financial impact due to changes in regulations. There is no material incremental impact in the gratuity
and compensated absences liability in financial statementsas at 31.03.2026 due to change in definition of wages.
Note 46:
The Company has used accounting software for maintaining its books of account, which have a feature of recording audit trail
(edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the respective software.
Further, where the audit trail (edit log) facility was enabled and operated, the audit trail feature has not been tampered with.
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