2.14 Provisions and contingent liabilities
1. 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. The expense relating to a provision is presented in the standalone statement of profit and loss
net of any reimbursement. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate
that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the
passage of time is recognized as a finance cost.
2. Contingent liabilities
Contingent liability is a possible obligation that arises from past events and the existence of which will be confirmed only by the
occurrence or non-occurrence of one are more uncertain future events not wholly within the control of the Company, or is a present
obligation that arises from past event but is not recognized because either it is not probable that an outflow of resources embodying
economic benefits will be required to settle the obligation, or a reliable estimate of the amount of the obligation cannot be made.
The Company does not recognize a contingent liability but discloses its existence in the standalone financial statements unless the
probability of outflow of resources is remote.
3. Contingent assets
Contingent assets are not recognized. However, when the realization of income is virtually certain, then the related asset is no longer
a contingent asset, but it is recognized as an asset.
Provisions, contingent liabilities, contingent assets and commitments are reviewed at each standalone balance sheet date.
2.15 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. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through
standalone statement of profit and loss are recognized immediately in standalone statement of profit and loss.
1. Financial assets
All financial assets are recognized initially at fair value plus, in the case of financial assets not recorded at fair value through standalone
statement of profit and loss, transaction costs that are attributable to the acquisition of the financial asset. Purchases or sales of
financial assets that require delivery of assets within a time frame established by regulation or convention in the market-place (regular
way trades) are recognized on the trade date, i.e., the date that the Company commits to purchase or sell the asset.
a. Classification and subsequent measurement:
Debt instruments that meet the following conditions are subsequently measured at amortised cost less impairment loss (except
for debt investments that are designated as at fair value through profit or loss on initial recognition) (i) the asset is held within
a business model whose objective is to hold assets in order to collect contractual cash flows; and (ii) the contractual terms
of the instrument give rise on specified dates to cash flows that are solely payments of principal and interest on the principal
amount outstanding.
Debt instruments that meet the following conditions are subsequently measured at fair value through other comprehensive
income (except for debt investments that are designated as at fair value through profit or loss on initial recognition) (i) the
asset is held within a business model whose objective is achieved both by collecting contractual cash flows and selling financial
assets; and (ii) the contractual terms of the instrument give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
FVTPL is a residual category for debt instruments. Any debt instrument, which does not meet the criteria for categorization as
at amortized cost or as FVTOCI, is classified as at FVTPL. Trade receivables, cash and cash equivalents, other bank balances,
loans and other financial assets are classified for measurement at amortised cost.
Financial assets at amortised cost are subsequently measured at amortised cost using effective interest method. The effective
interest method is a method of calculating the amortised cost of an instrument and of allocating interest income over the
relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees
paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts)
through the expected life of the debt instrument, or, where appropriate, a shorter period, to the net carrying amount on
initial recognition.
b. Equity instruments:
The Company subsequently measures all equity investments in scope of Ind AS 109 at fair value, with net changes in fair value
recognized in the standalone statement of profit and loss.
c. Derecognition
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily
derecognized (i.e. removed from the Company's standalone financial statements of assets and liabilities) when: i) The rights
to receive cash flows from the asset have expired, or ii) The Company has transferred its rights to receive cash flows from the
asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a 'pass¬
through' arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the
Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control
of the asset.
When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement,
it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained
substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognise
the transferred asset to the extent of the
Company's continuing involvement. In that case, the Company also recognises an associated liability. The transferred asset and
the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original
carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay.
d. Impairment of financial assets
The Company recognises loss allowances using the Expected Credit Loss (ECL) model for the financial assets which are not fair
valued through profit and loss. Loss allowance for trade receivables with no significant financing component is measured at
an amount equal to lifetime ECL. For all other financial assets, expected credit losses are measured at an amount equal to the
12-month ECL, unless there has been a significant increase in credit risk from initial recognition, in which case those financial
assets are measured at lifetime ECL. The changes (incremental or reversal) in loss allowance computed using ECL model, are
recognized as an impairment gain or loss in the standalone statement of profit and loss.
The Company recognises loss allowances for expected credit losses on financial assets measured at amortised cost.
At each reporting date, the Company assesses whether financial assets carried at amortised cost are credit impaired. A financial
asset is 'credit impaired' when one or more events that have a detrimental impact on the estimated future cash flows of the
financial asset have occurred.
Evidence that a financial asset is credit impaired includes the following observable data:
Ý significant financial difficulty of the borrower or issuer;
Ý a breach of contract such as a default or past dues;
Ý the restructuring of a loan or advance by the Company on terms that the Company would not consider otherwise; - it
is probable that the borrower will enter bankruptcy or other financial reorganisation; or
Ý the disappearance of an active market for a security because of financial difficulties.
The Company follows 'simplified approach' for recognition of impairment loss allowance on trade receivables which do not
contain a significant financing component. The application of simplified approach does not require the Company to track
changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime impairment pattern at each standalone
balance sheet date, right from its initial recognition.
In all cases, the maximum period considered when estimating expected credit losses is the maximum contractual period over
which the Company is exposed to credit risk.
When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when
estimating expected credit losses, the Company considers reasonable and supportable information that is relevant and available
without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on the Company's
historical experience and informed credit assessment and including forward looking information.
The Company considers a financial asset to be in default when:
Ý the borrower is unlikely to pay its credit obligations to the Company in full, without recourse by the Company to actions
such as realising security (if any is held); or
Ý the financial asset is more than past due.
The gross carrying amount of a financial asset is written off (either partially or in full) to the extent that there is no realistic
prospect of recovery. This is generally the case when the Company determines that the counterparty does not have assets
or sources of income that could generate sufficient cash flows to repay the amounts subject to write-off. However, financial
assets that are written off could still be subject to enforcement activities in order to comply with the Company's procedures
for recovery of amounts due.
2. Financial liabilities
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit and loss, loans and borrowings,
payables, as appropriate.
a. Initial recognition and measurement
All financial liabilities are recognized initially at fair value and, in the case of loans and borrowings and payables, net of directly
attributable transaction costs. The Company's financial liabilities include Borrowings, Other Financial Liabilities, Trade Payables
and Leases.
b. Subsequent measurement
All financial liabilities are subsequently measured at amortized cost using the effective interest method or at FVTPL. For financial
liabilities that are denominated in a foreign currency and are measured at amortized cost at the end of each reporting period,
the foreign exchange gains and losses are determined based on the amortized cost of the instruments and are recognized in
'Other income'. The fair value of financial liabilities denominated in a foreign currency is determined in that foreign currency
and translated at the spot rate at the end of the reporting period. For financial liabilities that are measured as at FVTPL, the
foreign exchange component forms part of the fair value gains or losses and is recognized in profit or loss.
c. Derecognition
The Company derecognizes financial liabilities when, and only when, the Company's obligations are discharged, cancelled or
have expired. The difference between the carrying amount of the financial liability derecognized and the consideration paid
and payable is recognized in standalone statement of profit and loss.
3. Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the standalone balance sheet if there is a currently
enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, to realise the assets and
settle the liabilities simultaneously.
4. Impairment of non-financial assets
The carrying amounts of assets are reviewed at each standalone balance sheet date. If there is any indication of impairment
based on internal / external factors, an impairment loss is recognized, i.e. wherever the carrying amount of an asset exceeds its
recoverable amount.
For impairment testing, assets that do not generate independent cash inflows are Compared together into cash-generating units
(CGUs). Each CGU represents the smallest Company of assets that generates cash inflows that are largely independent of the cash
inflows of other assets or CGUs.
The recoverable amount of a CGU (or an individual asset) is the higher of its value in use and its fair value less costs to sell. Value in
use is based on the estimated future cash flows, 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 CGU (or the asset).
The Company's corporate assets (e.g., office building for providing support to various CGUs) do not generate independent cash
inflows. To determine impairment of a corporate asset, recoverable amount is determined for the CGUs to which the corporate
asset belongs.
An impairment loss is recognized if the carrying amount of an asset or CGU exceeds its estimated recoverable amount. Impairment
losses are recognized in the standalone statement of profit and loss. Impairment loss recognized in respect of a CGU is allocated first
to reduce the carrying amount of any goodwill allocated to the CGU, and then to reduce the carrying amounts of the other assets
of the CGU (or group of CGUs) on a pro rata basis.
An impairment loss in respect of assets for which has been recognized in prior periods, the Company reviews at each reporting
date whether there is any indication that the loss has decreased or no longer exists. An impairment loss is reversed if there has been
a change in the estimates used to determine the recoverable amount. Such a reversal is made only to the extent that the asset's
carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no
impairment loss had been recognized.
2.16 Fair value measurement:
The Company measures financial instruments such as derivatives at fair value at each balance sheet 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:
1. In the principal market for the asset or liability, or
2. In the absence of a principal market, in the most advantageous market for the asset or liability
The principal or the most advantageous market must be accessible by the Company.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset
or liability, assuming that market participants act in their economic best interest.
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 techniques that are appropriate in the circumstances and for which sufficient data are available to
measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the standalone financial statements are categorised within the
fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
1. Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities.
2. Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or
indirectly observable.
3. Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.
For assets and liabilities that are recognized in the standalone financial statements on a recurring basis, the Company determines
whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that
is significant to the fair value measurement as a whole) at the end of each reporting period.
External valuers may be required for valuation of significant assets and liabilities. Involvement of external valuers is decided on the
basis of nature of transaction and complexity involved. Selection criteria include market knowledge, reputation, independence and
whether professional standards are maintained.
At each reporting date, the Management analyses the movements in the values of assets and liabilities which are required to be
remeasured or re-assessed as per the Company's accounting policies. For this analysis, the Management verifies the major inputs
applied in the latest valuation by agreeing the information in the valuation computation to contracts and other relevant documents.
A change in fair value of assets and liabilities is also compared with relevant external sources to determine whether the change
is reasonable.
For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature,
characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.
This note summarises accounting policy for fair value. Other fair value related disclosures are given in the relevant notes.
2.17 Foreign Currencies
Transactions in foreign currencies are translated into the functional currency at the exchange rate at the date of the transaction or an
average rate if the average rate approximate the actual rate at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rate
at the reporting date. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are
translated using the exchange rates at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign
currency are translated using the exchange rates at the date when the fair value is determined. The gain or loss arising on translation
of non-monetary items measured at fair value is treated in line with the recognition of the gain or loss on the change in fair value of
the item (i.e., translation differences on items whose fair value gain or loss is recognised in OCI or profit or loss are also recognised
in OCI or profit or loss, respectively).
Exchange differences arising on settlement or translation of monetary items are recognised in profit or loss.
2.18 Borrowing costs
Borrowing costs directly attributable to the acquisition, construction, or production of a qualifying asset are capitalized as part of
the cost of that asset, while all other borrowing costs are charged to profit or loss as incurred. Transaction costs associated with
obtaining borrowings are subsequently amortized over the term of the borrowing, consistent with the effective interest method
under Ind AS 109 and other borrowing-related costs are expensed immediately in the period incurred.
2.19 Cash and cash equivalents
Cash and cash equivalent in the standalone balance sheet comprise cash at banks and on hand and short-term deposits with
an original maturity of three months or less, which are subject to an insignificant risk of changes in value. For the purpose of the
standalone statement of cash flows, cash and cash equivalents consist of cash and short-term deposits, as defined above, net of
outstanding bank overdrafts (if any) as they are considered an integral part of the Company's cash management.
2.20 Cash flow statement
Cash flows are reported using the indirect method, whereby loss for the period is adjusted for the effects of transactions of a
non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses
associated with investing or financing cash flows. The cash flows from operating, investing and financing activities of the Company
are segregated.
2.21 Events occurring after the balance sheet date
Based on the nature of the event, the Company identifies the events occurring between the standalone balance sheet date and
the date on which the standalone financial statements are approved as 'Adjusting Event' and 'Non-adjusting event'. Adjustments to
assets and liabilities are made for events occurring after the balance sheet date that provide additional information materially affecting
the determination of the amounts relating to conditions existing at the balance sheet date or because of statutory requirements
or because of their special nature. For non-adjusting events, the Company may provide a disclosure in the standalone financial
statements considering the nature of the transaction.
2.22 Recent Accounting Pronouncements
MCA has notified amendments to Ind AS 1 (classification of liabilities and disclosure of material accounting policies) and amendments
to Ind AS 7 and Ind AS 107 (disclosures relating to supplier finance arrangements). The Company has evaluated these amendments
and has no impact of the recognition and measurement of assets and liabilities on its standalone financial statements.
Standards notified but not yet effected
Ministry of Corporate Affairs ("MCA") notifies new standards or amendments to the existing standards under Companies (Indian
Accounting Standards) Rules as issued from time to time.
Ind AS 118 - Presentation and Disclosure in Financial Statements, which will replace Ind AS 1 and is effective for annual reporting
periods beginning on or after April 1, 2027. Ind AS 118 introduces revised presentation requirements in the statement of profit and
loss and enhanced disclosure requirements.
Amendments to Ind AS 1 - For annual reporting periods beginning on or after 1 April 2026, any breach of a covenant-whether
material or immaterial -occurring on or before the reporting date will, in accordance with Ind AS 1, require the related liability
to be classified as current, unless the lender has granted a waiver of the breach on or before the reporting date and has agreed
not to demand repayment for at least 12 months after the reporting date as a consequence of the breach. Such a waiver shall be
treated as an adjusting event. The Company is currently assessing the probable impact of these amendments on its standalone
financial statements.
(d) Terms and rights attached to equity shares
The Company has only one class of equity shares having a par value of Rs.10 per share. Each shareholder is eligible for one vote per
share held. In the event of liquidation of the Company, the equity shareholders are eligible to receive the remaining assets of the
Company after distribution of all preferential amounts, in proportion to their shareholding.
(e) (i) Preferential allotment
During the year ended March 31, 2025, the Company has made preferential allotment of 10,72,466 equity shares at H300 per
share (with a securities premium of H290 per share)
(ii) Conversion and forfeiture of Share warrants
During the year ended March 31, 2025, the Company has converted 28,61,500 share warrants at an issue price of H72 (with a
securities premium of H62 per share) into equal number of equity shares.The Company had allotted 5,57,650 fully convertible
share warrants to the promoters on August 23, 2024 at an issue price of H300/- (including security premium of H290/- each),
each convertible into one equity share of face value H10. At the time of allotment, the Company received 25% of the issue price
(H75 per warrant). During the year ended March 31, 2026, the Company has received an amount of H437.63 lakhs towards
conversion of 1,94,500 warrants into equity shares (out of 5,57,650 warrants allotted on August 23, 2024 at an issue price of
300/- per warrant).
As per the terms of issue and the applicable provisions of the SEBI (Issue of Capital and Disclosure Requirements) Regulations,
2018, the warrants were required to be converted within 18 months from the date of allotment, i.e., on or before February 22,
2026, failing which the warrants would lapse and the upfront subscription amount paid at the time of allotment would stand
forfeited. Accordingly, the balance 3,63,150 fully convertible share warrants were not exercised within the stipulated conversion
period and consequently lapsed with effect from February 23, 2026. The upfront subscription amount received at the time of
allotment in respect of such unexercised warrants was forfeited and transferred from 'Other Equity - Money received against share
warrants' to capital reserve, in accordance with the terms of issue and the applicable regulatory requirements.
(h) Aggregate number of bonus shares issued, shares issued for consideration other than cash and shares bought
back during the period of five years immediately preceding the reporting date :
The Company has not allotted any fully paid up shares pursuant to contract(s) without payment being received in cash except as
disclosed in note 40 relating to share swap .The Company has not bought back any class of shares during the period of five years
immediately preceeding the balance sheet date during the year ended March 31, 2026.
(ii) Securities premium
Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as
issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.
(iii) Capital reserve
Capital reserve represents the reserve created on account of forfeiture of share warrant amount (Refer note 13(e))
(iv) Other comprehensive income
Other comprehensive income (OCI) represent the balance in equity for items to be accounted in OCI. It is classified into (i) items that
will not be reclassified to statement of profit and loss, and (ii) items that will be reclassified to statement of profit and loss.The said
portion of equity represents excess/(deficit) of investment valued at fair value through OCI in accordance with Ind AS109 "Financial
Instruments" as specified under section 133 of the Act, read with Rule7 of the Companies (Accounts) Rules, 2014 and the Companies
(Indian Accounting Standards) Rule 2015.
Terms & Conditions
(i) Transactions with related parties during the year were based on terms that would be available to third parties. All other transactions
were made in ordinary course of business and at arm's length price.
(ii) All outstanding balances are unsecured and are repayable in cash.
(iii) Remuneration does not include the provision made for gratuity, as they are determined on an acturial basis for the Company as a
whole. The decisions relating to the remuneration of the KMPs are taken by the Board of Directors of the Company, in accordance with
shareholders approval, wherever necessary.
31.1 Fairvalueheirarchy
i) The Company uses the following hierarchy for fair value measurement of the company's financials assets and liabilities:
Level 1: Quoted prices/NAV (unadjusted) in active markets for identical assets and liabilities at the measurement date.
Level 2: Other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either
directly or indirectly.
Level 3: Techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable
market data.
ii) Fair valuation techniques
The Company maintains policies and procedures to value financial assets or financial liabilities using the best and most relevant
data available. The fair values of the financial assets and liabilities are included at the amount 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 following
methods and assumptions were used to estimate the fair values:
1) Fair value of cash and deposits, trade receivables, trade payables, and other current financial assets and liabilities approximate
their carrying amounts largely due to the short term maturities of these instruments.
2) Borrowings are evaluated by the Company based on parameters such as interest rates, specific country risk factors, credit risk
and other risk characteristics. Fair value of variable interest rate borrowings approximates their carrying values.
The Company's principal financial liabilities comprise borrowings, trade and other payables. The main purpose of these financial liabilities
is to manage finances for the Company's operations. The Company's principal financial assets comprise trade and other receivables, loan
and cash and cash equivalent that arise directly from its operations.
The Company's activities expose it mainly to market risk, liquidity risk and credit risk. The monitoring and management of such risks is
undertaken by the senior management of the Company and there are appropriate policies and procedures in place through which such
financial risks are identified, measured and managed in accordance with the Company's policies and risk objectives. It is the Company
policy not to carry out any trading in derivative for speculative purposes.
The Company Board of Directors is ultimately responsible for the overall risk management approach and for approving the risk strategies
and principles. No significant changes were made in the risk management objectives and policies during the year ended March 31,
2026 and March 31, 2025. The management of the company reviews and agrees policies for managing each of these risks which are
summarised below:
The Company has exposure to the following risks arising from financial instruments:
A) Market risk
B) Liquidity risk
C) Credit risk
A) Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices.
Market prices comprises three types of risk: currency rate risk, interest rate risk and other price risks, such as equity price risk and
commodity price risk. Financial instruments affected by market risks include loan and borrowings, deposit, investments, and foreign
currency receivables and payables.
(i) Interest rate risk
Interest rate risk is the risk that the fair value of 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
total debt obligations with floating interest rates.
(ii) Foreign currency risk
The Company do not have any foreign currency exposure as at March 31, 2026.
(iii) Commodity price risk
Commodity price risk is the risk that future cash flows of the Company will fluctuate on account of changes in market price of
key items used in trading of goods. The Company is exposed to the movement in the price of items used in the trading of goods
in domestic and international markets. The Company has in place policies to manage exposure to fluctuation in the prices such
items. However no material exposure existed at the year ended March 31, 2026.
B) Liquidity Risk
Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at reasonable price.
The Company uses liquidity forecast tools to manage its liquidity. The Company is able to organise liquidity through own funds and
through current borrowings.The Company has good relationship with its lenders, as a result of which it does not experience any
difficulty in arranging funds from its lenders. Table here under provides the current ratio of the Company as at the year end.
C) Credit risk
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to
a financial loss. The entity is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing
activities, financial assets. Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis.
Credit evaluations are performed on all customers requiring credit over a certain amount.
a) For trade receivables
The customer credit risk is managed subject to the Company's established policy, procedure and controls relating to customer credit
risk management. In order to contain the business risk, prior to acceptance of an order from a customer, the creditworthiness of
the customer is ensured through scrutiny of its financials, if required, market reports and reference checks. The Company remains
vigilant and regularly assesses the financial position of customers during execution of contracts with a view to limit risks of delays
and default. Further, in most of the cases, the Company normally allow credit period of 30-45 days to all customers which vary
from customer to customer. In view of the industry practice and being in a position to prescribe the desired commercial terms,
credit risks from receivables are well contained on an overall basis.
The impairment analysis is performed on each reporting period on individual basis for major customers. Some trade receivables
are grouped and assessed for impairment collectively. The calculation is based on historical data of losses, current conditions and
forecasts and future economic conditions. The Company's maximum exposure to credit risk at the reporting date is the carrying
amount of each financial asset as detailed in notes. 5,6,7,9 and 10.
(b) Loans to related parties
The Company considers the probability of default upon initial recognition of loan and whether there has been a significant
increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is a significant increase in
credit risk, the Company compares the risk of a default occurring on the loan as at the reporting date with the risk of default as
at the date of initial recognition.
c) For other financial assets
The impairment analysis is performed on each reporting period on individual basis for major customers. Some trade receivables
are grouped and assessed for impairment collectively. The calculation is based on historical data of losses, current conditions and
forecasts and future economic conditions. The Company's maximum exposure to credit risk at the reporting date is the carrying
amount of each financial asset as detailed in notes 6.
33. Segment information
The segment reporting of the Company has been prepared in accordance with Ind AS-108, " Operation Segment " ( specified under the
section 133 of the Companies Act 2013 (the "Act") read with the Companies ( Indian Accounting Standards ) Rule 2015( as amended from
time to time) and other relevent provision of the Act) For management purpose, the Company is organised into business units based on its
products and services and has two reportable segments as follows:
a) Operation Segments
Agro Commodities
Steel Abrasives
b) Identification of Segments:
The Board of Directors monitors the operating results of its business segments separately for the purpose of making decisions about
resource allocation and performations assessment. Segment performance is evaluated based on profit or loss and its measured
consistenly with profit and loss in the Financial statements. Operating segments have been identified on the basis of the nature of
product/ services and have been identified as per the quantitative criteria specified in the Ind AS.
c) Revenue and expenses have been identified to a segment on the basis of relationship to operating activities of the segment. Revenue
and expenses which relate to enterprise as a whole and are not allocable to segment on reasonable basis have been disclosed as
"unallocable".
d) Segment assets and segment liabilities represent and liabilities in respective segment, Investments, tax related assets, borrowings and
other assets and liabilities that can not be allocated to a segment on resonable basis have been disclosed as " unallocable".
e) There is no transfer of products between operating segments
f) No operating segments have been aggregated to form the above reportable operating segments
(i) Finance income and costs on financial assets are not allocated to individual segments as the underlying instrumentsare managed at
Company level.
(ii) Current taxes, deferred taxes and certain financial assets and liabilities are not allocated to those segments as they are also managed
at company level.
34. Capital management
For the purpose of Capital Management, Capital includes net debt and Total equity of the Company. The Company manages its capital so
as to safeguard its ability to continue as a going concern and to optimise returns to shareholders. 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 investor, creditors
and market confidence.The Company may take appropriate steps in order to maintain, or if necessary adjust, its capital structure.
(i) The Assessing officer has made additions of Rs. 20.91 lakhs vide order dated 27/03/2022 u/s 143(3) in respect of A.Y 2013-14,
therefore raising a demand of Rs.7.19 lakhs. The same has been contested before CIT (Appeals), Delhi and is pending before the said
authority. The Company does not expect any liability on the above account.
(ii) The Assessing officer has made additions of Rs. 77.77 lakhs vide order dated 28/12/2022 u/s 143(3) in respect of A.Y 2021-22,
therefore raising a demand of Rs. 2.80 lakhs. The same has been contested before CIT (Appeals), Delhi and is pending before the said
authority. The Company does not expect any liability on the above account.
(iii) The Company received a GST demand order dated April 17, 2025 under Section 74 of the GST Act, 2017, amounting to H86.11 lakhs
(including tax, interest and penalty) relating to alleged ineligible input tax credit on account of the supplier's non-payment of GST.
The Company has filed an appeal against the demand on May 29, 2025 and, based on management's assessment, no provision has
been recognised as the likelihood of an outflow of economic resources is considered not probable. Accordingly, the matter has been
disclosed as a contingent liability.
(iv) The Company has received a GST demand order on April 03, 2024, aggregating to H67.68 lakhs (including tax, interest and penalty)
in respect of alleged short payment of tax under the Reverse Charge Mechanism (RCM) and excess/reversible input tax credit.
The Company has disputed the demand and filed an appeal before the appropriate appellate authority. Based on management's
assessment, no provision has been recognised in the financial statements
(v) The Company has received an order dated 18th February 2025 from the Commercial Tax Officer, Tuticorin-III, Tirunelveli, Tamil
Nadu, pursuant to remand directions from the Hon'ble High Court against the earlier order issued on 9th April 2024 (Ref No.
ZD330424071304R), for the tax period April 2018 to March 2019. The GST authorities have raised a demand aggregating to H39.53
lakhs under Section 73(1) of the CGST Act for FY 2018-19, primarily relating to non-production of original invoices and purchase
omissions. The Company has disputed the demand and filed an appeal on May 12, 2025. Based on management's assessment, the
Company believes it has a sustainable case on merits and, accordingly, no provision has been recognised in the financial statements
(vi) The Commercial Taxes Department, Government of Tamil Nadu, has issued an assessment order (Order No. 220802220605837
dated 08/02/2022) against the Company for the financial year April 2018 to March 2019 under GSTIN 33AAFCM8959A1ZG. The total
demand raised under this order, including tax, interest, and penalty, aggregates to H17.37 lakhs. The company has filed an appeal on
May 29, 2025. As the matter is pending adjudication and not yet concluded, no provision has been made in the books of accounts.
(vii) The Company has received a GST demand order, aggregating demand of H110.75 lakhs (including tax, interest and penalty) under
Section 73 of the CGST Act, 2017, primarily relating to differences between GSTR-3B and GSTR-9C, non-reversal of input tax credit
on credit notes, blocked credit and other related matters. The Company has disputed the demand and filed an appeal on August 26,
2025. Based on management's assessment, no provision has been recognised in the financial statements.
(viii) During the GST audit conducted under Section 65 of the CGST/TNGST Act, 2017 for FY 2017-18, the tax authorities identified
certain discrepancies in the Company's GST records and returns. Consequently, The Company has received a GST demand order
dated August 16, 2025, aggregating demand of H383.94 lakhs (including tax, interest and penalty). The Company had filed a
rectification application against the order on November 14, 2025, which has been rejected by the tax authorities on February 06,
2026 and an appeal against the order yet to be filed. Based on management's assessment, no provision has been recognised in the
financial statements.
(ix) The Company has received a GST demand order by CGST Panipat division on December 24, 2025, aggregating demand to H27.47
lakhs (including tax, interest and penalty) relating to alleged short payment of GST and excess availment of input tax credit (ITC) on
38. Corporate Social Responsibility (CSR)
The Company has contributed Rs. Nil towards CSR activites during financial year 2025-26, (March 31, 2025: Nil). The Company does not
fall under the ceiling limit as prescribed under section 135 of the Companies Act 2013.
39. Going Concern
During the year ended March 31, 2026, the Company incurred a loss before tax of INR 545.45 lakhs (Previous year: INR 509.61 lakhs) and
a cash loss of INR 540.73 lakhs (Previous year: INR 504.09 lakhs). Further, revenue from operations declined significantly during the year
as compared to the previous year, primarily due to the absence of major revenue-generating activities during the current year.
Notwithstanding the above, as at March 31, 2026, the Company had a positive net worth of INR 29,648.40 lakhs (March 31, 2025: INR
30,118.35 lakhs), and its current assets exceeded its current liabilities by INR 1,061.78 lakhs (March 31, 2025: INR 1,330.36 lakhs). The
Company also has adequate liquid resources to meet its operational requirements, statutory dues and other financial obligations as and
when they fall due. The management is actively pursuing new business opportunities and contracts to revive operations and strengthen the
Company's revenue base. Based on the Company's business plans, available financial resources, projected cash flows and the assessment of
its ability to meet its obligations as they fall due, the management believes that the Company will continue to operate as a going concern for
the foreseeable future. Accordingly, the accompanying financial statements have been prepared on a going concern basis. Consequently,
no adjustments have been made to the carrying amounts and classification of assets and liabilities that may be required if the Company
were unable to continue as a going concern.
40. Share Swap
During the year ended March 31, 2025, on April 22, 2024, the Company acquired the remaining 96.82% equity interest in Fratelli Wines
Private Limited through a share swap arrangement under which it issued 3,07,79,177 equity shares of H10 face value (with a securities
premium of H62 per share) in exchange for 1,23,11,671 equity shares of Fratelli Wines Private Limited (face value H10, securities premium
H170). Following the transaction, Fratelli Wines Private Limited has become a wholly-owned subsidiary of the Company.
41. Employee Benefit Expenses
A) Defined Contribution Plans:
The Company makes contribution in the form of provident funds as considered defined contribution plans and contribution to
Employees Providend Fund Orgnisation.The Company has no further payment obligations once the contributions have been paid.
Following are the schemes covered under defined contributions plans of the Company:
Provident Fund Plan & Employee Pension Scheme: The Company makes monthly contributions at prescribed rates towards
Employee Provident Fund administered and managed by Ministry of Labour & Employment,Government of India.
Employee State Insurance: The Company makes prescribed monthly contributions towards Employees State Insurance Scheme and
payment made to Employee State Insurance Corporation, Ministry of Labour & Employment,Government of India.
43. Other statutory information
(a) Details of benami property held
The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for
holding any Benami property.
(b) Relationship with struck off companies
The Company does not have any transactions with struck off companies.
(c) Details of crypto currency or virtual currency
The Company has not traded or invested in crypto currency or virtual currency during the year ended March 31, 2026 and March
31, 2025.
(d) Charges or satisfaction
The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.
(e) Wilful defaulter
The Company is not a declared wilful defaulter by any bank or financial Institution or other lender, in accordance with the guidelines
on wilful defaulters issued by the Reserve Bank of India, during the year ended March 31, 2026 and March 31, 2025.
(f) Details of advanced or loaned or invested funds
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 to or on behalf of the Ultimate Beneficiaries.
43. Other statutory information (Contd.)
(g) Utilisation of Borrowed funds and share premium
The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the
understanding (whether recorded in writing or otherwise) that the Company shall: (a) directly or indirectly lend or invest in other
persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or (b) provide any
guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(h) Details of transaction disclosed under Income Tax Act
The Company does not have 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.
(i) Compliance with approved scheme(s) of arrangements
The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year.
(j) Compliance with layers for its holding in downstream companies
The Company has complied with the number of layers for its holding in downstream companies prescribed under clause (87) of
section 2 of the Companies Act, 2013 read with the Companies (Restriction on number of Layers) Rules, 2017.
(k) Audit Trail( edit Log)
The Company has used an accounting software i.e Tally Prime for maintaining its books of account for the financial year ended March
31, 2026 which has a feature of recording audit trail (edit log) facility except audit trail on the database level and the same has been
operating for all relevant transactions recorded in the software throughout the year. Additionally, the audit trail has been preserved by
the Company as per the statutory requirements for record retention. Based on the Company's internal assessment, there has been no
instance of the audit trail feature being tampered with during the year.
(l) Data Back Up
As per the MCA notification dated August 5, 2022, the Central Government has notified the Companies (Accounts) Fourth Amendment
Rules, 2022. As per the amended rules, the Companies are required to maintain the back-up of the books of account and other
relevant books and papers in electronic mode that should be accessible in India at all the time. Also, the Companies are required to
create back-up of accounts on servers physically located in India on a daily basis. The books of account along with other relevant
records and papers of the Company are maintained in electronic mode. These are readily accessible in India at all times and a back-up
is maintained in servers situated in India and The Company and its officers have full access to the data in the servers.
44. Change in name
The Company has changed its name from Tinna Trade Limited to Fratelli Vineyards Limited with effect from July 26, 2024 as approved
by the shareholders through a special resolution passed on April 01, 2024. The name change was subsequently approved by the
Registrar of Companies on July 26, 2024. This change aligns with the company's strategic direction and branding objectives to better
represent its vision and operations.
45. Events occuring after reporting period
The Company evaluates events and transactions that occur subsequent to the balance sheet date but prior to the issuance of the
standalone financial statements to determine the necessity for recognition and/or reporting of any such events and transactions in
the financial statements. As of May 30, 2026, there were no subsequent events to be recognized or reported in these standalone
financial statements
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