2.17 Provisions

Provision is recognised when:

i) The Company has a present obligation
as a result of a past event

ii) A probable outflow of resources is
expected to settle the obligation and

iii) A reliable estimate of the amount of the
obligation can be made.

Reimbursement of the expenditure required
to settle a provision is recognised as per
contract provisions or when it is virtually
certain that reimbursement will be received.

Provisions are reviewed at each Balance
Sheet date.

a) Discounting of Provisions

Provision which expected to be settled
beyond 12 months are measured at the
present value by using pre-tax discount
rate that reflects the risks specific to the
liability. The increase in the provision due
to the passage of time is recognised as
interest expenses.

Onerous Contract

Present obligations arising under onerous
contracts are recognized and measured as
provisions. An onerous contract is considered
to exist where the company has a contract
under which the unavoidable costs of
meeting the obligations under the contract
exceed the economic benefits expected to
be received under it.

2.18 Contingent Liabilities and Contingent Assets

(a) Contingent Liabilities are disclosed in
either of the following cases:

i) A present obligation arising from a
past event when it is not probable
that an outflow of resources will be
required to settle the obligation; or

ii) A reliable estimate of the present
obligation cannot be made; or

iii) A possible obligation unless the
probability of outflow of resource
is remote.

(b) Contingent assets is disclosed where an
inflow of economic benefits is probable.

(c) Contingent Liability and Provisions
needed against Contingent Liability and
Contingent Assets are reviewed at each

Reporting date.

(d) Contingent Liability is net of estimated
provisions considering possible outflow
on settlement.

2.19 Earnings Per Equity Share

In determining earnings per share the
Company considers the net profit
attributable to equity shareholders. The
number of shares used in computing basic
and diluted earnings per share is the weighted
average number of shares outstanding
during the year.

2.20 Liquidated Damages and Penalties

"Credit items arising on account of
Liquidated Damages and Penalties during
execution of contract or due to termination
of contract etc. are carried as "Retained
Amount for Damages A/c" under "Other
Current Liabilities" until the management
has decided either to levy or waive the same
before financial closure of the project.
Thereafter if these are not levied or waived
by the management before financial closure
of the project such leftover balances of
liquidated damages and penalties etc.
are credited to the total cost of the
concerned project on financial closure of the
project".

2.21 Operating Segment

An operating segment is a component of the
Company that engages in business activities
from which it may earn revenues and incur
expenses, whose operating results are
regularly reviewed by the Company's Chief
Operating Decision Maker ("CODM") to make
decisions for which discrete financial
information is available. Based on the
management approach as defined in Ind AS
108, the CODM evaluates the Company's
performance and allocates resources based
on an analysis of various performance
indicators by business segments and
geographic segments.

2.22 Fair Value Measurement

Company measures financial instruments at
fair value at each reporting date. Fair value
is the price that would be received to sell an
asset or paid to transfer a liability in an orderly
transaction between market participants at

the measurement date. The fair value
measurement is based on the presumption
that the transaction to sell the asset or transfer
the liability takes place either:

• in the principal market for the asset or
liability or

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

The principal or the most advantageous
market must be accessible to 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. The company uses valuation
techniques that are appropriate in the
circumstances and for which sufficient data
are available to measure fair value
maximizing the use of relevant observable
inputs and minimizing the use of
unobservable inputs.

Financial Guarantee Contracts

Financial guarantee contracts issued by the
Company are those contracts that require a
payment to be made to reimburse the holder
for a loss it incurs because the specified debtor
fails to make a payment when due in
accordance with the terms of a debt
instrument. Financial guarantee contracts are
recognised initially as a liability at fair value,
adjusted for transaction costs that are directly
attributable to the issuance of the guarantee.
Subsequently, the liability is measured at the
higher of the amount of loss allowance
determined as per impairment requirements
of Ind AS 109 and the amount recognised less
cumulative amortisation.

2.23 Dividend to equity holders

Dividend paid/payable shall be recognised
in the year in which the related dividends are
approved by shareholders or board of
directors as appropriate.

2.24 Financial instruments:-

(A) Initial recognition and measurement

Financial Instruments are recognized at its fair
value plus or minus transaction costs that are

directly attributable to the acquisition or issue
of the financial instruments.

(B) Subsequent measurement

(i) Financial Assets

Financial assets are classified in following
categories:

a) At Amortised Cost

b) Fair value through Other
Comprehensive Income.

c) Fair value through Profit and loss
account.

a. Debt instrument at Amortised Cost

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

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

(b) The contractual terms of the financial
asset give rise on specified dates to cash
flows that are solely payments of
principal and interest on the principal
amount outstanding.

Financial assets measured at amortised cost
using effective interest rate method less
impairment if any. The EIR amortisation is
included in finance income in the statement
of profit and loss.

b. Debt instrument at FVTOCI

A debt instrument is classified at FVTOCI
if both of the following criteria are met:

• The objective of the business model
is achieved both by collecting
contractual cash flows and selling
the financial assets and

• The asset's contractual cash flows
represent SPPI.

Debt instruments included within the FVTOCI
category are measured initially as well as at
each reporting date at fair value. Fair value
movements are recognized in the Other
Comprehensive Income (OCI). However the
company recognizes interest income

impairment losses & reversals and foreign
exchange gain or loss in the P&L. On de¬
recognition of the asset cumulative gain or
loss previously recognised in OCI is reclassified
from the equity to P&L. Interest earned is
recognised using the EIR method.

c. Debt instrument at FVTPL

FVTPL is a residual category for financial
Assets. Any financial assets which does
not meet the criteria for categorization
as at amortized cost or as FVTOCI is
classified at FVTPL.

In addition the Company may elect to
designate financial asset which
otherwise meets amortized cost or
FVTOCI criteria at FVTPL, if doing so
reduces or eliminates a measurement or
recognition inconsistency. The Company
has not designated any financial asset
at FVTPL.

Financial assets included within the
FVTPL category are measured at fair
value with all changes recognized in the
P&L.

Investment in Equity instruments are
measured through FVTOCI.

d. Equity Instrument at FVTOCI

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

The Company has made an irrevocable
election to present in other
comprehensive income subsequent
changes in the fair value of equity
investments not held for trading.

(ii) Financial liabilities

a) Financial liabilities at Amortised Cost

Financial liabilities at amortised cost
represented by trade and other
payables security deposits and retention

money are initially recognized at fair
value and subsequently carried at
amortized cost using the effective
interest rate method.

b) Financial liabilities at FVTPL

The company has not designated any
financial liabilities at FVTPL.

(C) Derecognition
Financial Asset

A financial asset (or where applicable a part
of a financial asset or part of a group of similar
financial assets) is derecognized only when
the contractual rights to the cash flows from
the asset expires or it transfers the financial
assets and substantially all risks and rewards
of the ownership of the asset.

Financial Liability

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

(D) Impairment of financial assets

Company applies expected credit loss (ECL)
model for measurement and recognition of
impairment loss. The Company follows
simplified approach for recognition of
impairment loss allowance on trade
receivable. 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 ECLs at each reporting date right
from its initial recognition

Company assesses on a forward looking basis
the expected credit losses associated with its
assets carried at amortised cost and FVTOCI
debt instruments. The impairment
methodology applies on whether there has
been significant increase in credit risk.

2.25 Investment Property

Properties that are held for long-term rental
yields and / or for capital appreciation are
classified as investment properties.
Investment properties are stated at cost of
acquisition or construction less accumulated
depreciation and impairment, if any.
Depreciation is recognised using the straight
line method so as to amortise the cost of
investment properties over their useful lives
as specified in Schedule II of the Companies
Act, 2013.Transfers to, or from, investment
properties are made at the carrying amount
when and only when there is a change in
use.

An item of investment property is
derecognised upon disposal or when no
future economic benefits are expected to
arise from the continued use of asset. Any gain
or loss arising on the disposal or retirement of
an item of investment property is determined
as the difference between the sales proceeds
and the carrying amount of the property and
is recognised in the Statement of Profit and
Loss.Income received from investment
property is recognised in the Statement of
Profit and Loss on a straight-line basis over
the term of the lease

2.26 Cash and cash equivalents

Cash and cash equivalent comprise cash at
bank and on hand. It includes term deposits
and short term money market deposits with
original maturities of three months or less that
are readily convertible to known amounts of
cash and which are subject to an insignificant
risk of changes in value.

2.27 Prepaid Expenses

Prepaid expenses up to INR 5,00,000/- in each
case are treated as expenditure/income of
the year and accounted for to the
naturalhead of accounts.

2.28 Prior period errors

Errors/omissions discovered in the current year
relating to prior periods are treated as
immaterial and adjusted during the current

year, if all such errors and omissions in
aggregate does not exceed 1% of total
operating revenue as per last audited
financial statement of the Company.

If the error occurred before the earliest period
presented, the opening balances of assets,
liabilities and equity for the earliest period
presented, are restated.

2.29 NEW STANDARDS/ AMENDMENTS AND OTHER
CHANGES EFFECTIVE APRIL 1,2024 OR
THEREAFTER

Pursuant to the notifications issued by the
Ministry of Corporate Affairs dated 9
September 2024 and 28 September 2024, the
Companies (Indian Accounting Standards)
Second Amendment Rules, 2024 and Third
Amendment Rules, 2024 were notified,
amending the following standards effective
for annual reporting periods beginning on or
after 1 April 2024:

(a) Ind AS 117 - Insurance Contracts; and

(b) Ind AS 116 - Leases (amendments
relating to lease liability in sale and
leaseback transactions).

The above amendments have been
evaluated by the Company and did not
have a material impact on the financial
statements for prior periods. Further, they are
not expected to have a significant effect on
the financial statements for the current or
future periods.

2.30 NEW STANDARDS/ AMENDMENTS ISSUED BUT
NOT YET EFFECTIVE

On May 7, 2025, MCA notifies the
amendments to Ind AS 21 - Effects of Changes
in Foreign Exchange Rates. These
amendments aim to provide clearer
guidance on assessing currency
exchangeability and estimating exchange
rates when currencies are not readily
exchangeable. The amendment is effective
from the date of notification. The Company
is currently assessing the probable impact of
these amendments on its financial
statements.

Nature and Purpose of Other Reserves:

(a) Retained Earnings

Retained Earnings represents the undistributed profits of the Company.

(b) General Reserve

General Reserve is a free reserve which is created from retained earnings. The Company may pay dividend and issue
fully paid-up bonus shares to its members out of the general reserve account, and company can use this reserve for
buy-back of shares.

(c) Items of Other Comprehensive Income

The Company has elected to recognize changes in fair value of investment in equity securities of Indian Port Rail and
Ropeway Corporation Limited in other comprehensive income. The changes are accumulated within the FVTOCI
equity investments reserves within equity. The company transfers amounts from this reserve to retained earnings when
the relevant equity securities are de-recognized.

Terms of Repayment:

(i) There is a moratorium period of 3 years for each year’s loan. During the said moratorium period, no amount on account
of interest and principal shall be payable. The interest shall be charged on yearly basis and repayment of loan shall be
once in a year (for a period of 12 years) after the completion of moratorium period. Ministry of Railways would make
available to RVNL the required funds thereafter, to enable them to do the debt servicing. The debt servicing will pass
through RVNL books.

(ii) The Company has not borrowed any funds during this F.Y 2024-25 (Previous year 2023-24: Rs.Nil) from Indian Railway
Finance Corporation (IRFC). The outstanding borrowing is Rs. 4,492.36 crores as on 31.03.2025 (as at 31.03.2024 : Rs.
4,964.36 crore) , which includes current liability i.e. repayable in next twelve months Rs. 499.51 crores (as at 31.03.2024
: Rs. 472.00 crore).

(iii) The Interest Liability has been assessed on the amount disbursed in the FY 2006-07 to 2024-25 by applying the Interest
rate as advised by the IRFC for each Financial year (2024-25- No disbursement, 2023-24- No disbursement, 2022-23- No
disbursement, 2021-22: 7.64%, 2020-21: 7.73%, 2019-20: 8.42%, 2018-19: 9.17% & 8.93%, 2017-18: 8.82%, 2016-17: 8.19%,
2015-16: 8.68%, 2014-15: 9.56%, 2013-14: 9.60%, 2012-13: 9.41%, 2011-12: 10.12%, 2010-11: 9.12%, 2009-10: 8.92%, 2008-09:
9.96%, 2007-08: 10.24%, 2006-07: 9.73%).The interest accrued but not due on the IRFC loan amount has been shown in
the Balance Sheet as recoverable from MoR under Current Assets & Non-Current assets (for the interest non recoverable
in next 12 Months) and the interest payable but not due under the Current Liabilities and Non-Current Liabilities (for the
interest not payable in next 12 Months) payable to IRFC.

(v) The Interest Liability has been assessed on the amount disbursed in the FY 2005-06 to 2019-20 by applying the Interest
rate as advised by the IRFC for each Financial year ( 2019-20:8.45%, 2018-19: 8.75%, 2017-18 : 8.75% , 2016-17 :8.19%,
2015-16 :8.68%, 2014-15 :9.56%, 2013-14 :9.60%, 2012-13 :9.41%, 2011-12 :10.12%, 2010-11 :9.12%, 2009-10 :8.92%, 2008-09
:9.96%, 2007-08 :10.24%, 2006-07 :9.73%,2005-06 :8.06%)The interest accrued but not due on the IRFC loan amount has
been shown in the Balance Sheet as recoverable from MoR under Current Assets & Non-Current assets (for the interest
non recoverable in next 12 Months) and the interest payable but not due under the Current Liabilities and Non¬
Current Liabilities (for the interest not payable in next 12 Months) payable to IRFC.

Risk Analysis :

Company is exposed to a number of risks in the defined benefit plan which are as follows:

A) Salary Increases- Actual salary increases will increase the Plan’s liability. Increase in salary increase rate assumption in
future valuations will also increase the liability.

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

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

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

E) Withdrawals - Actual withdrawals proving higher or lower than assumed withdrawals and change of withdrawal
rates at subsequent valuations can impact Plan’s liability.

NOTE 30. DIVIDEND

The Board of Directors has recommended the final dividend of Rs. 1.72 per equity share having face value of Rs. 10 each for
the financial year 2024-25, subject to the approval of the shareholders at the ensuing Annual General Meeting.

NOTE 31. CAPITAL MANAGEMENT

The Group manages its capital in a manner to ensure and safeguard their ability to continue as a going concern so that
group can continue to provide maximum returns to shareholders and benefit to other stake holders. Group has paid
dividend as per the guidelines issued by Department of Public Enterprises (DPE) as follows:-

i) The carrying amounts of trade receivables, trade payables, unbilled revenue, cash and cash equivalents and other
short term trade receivables and payables which are due to be settled within 12 months are considered to the same
as their fair values, due to short term nature.

ii) Long term variable rate borrowings and lease receivables are evaluated by Company on parameters such as interest
rates, specific country risk factors and other risk factors. Based on this evaluation the fair value of such payables are not
materially different from their carrying amount.

iii) The fair values of office security deposits, other assets, and items like liquidated damages and penalties is determined
by discounting estimated future cash flows using current market interest rates. For FY 2024-25, a 7.70% SBI fixed deposit
rate is used for financial assets, and a 10.33% SBI lending rate is used for financial liabilities. These are reported under
Level 3 in the fair value hierarchy, given the use of unobservable factors, including credit risk of counterparties.

iv) Investment in unquoted equity of subsidiaries, joint ventures and associates are stated at cost as per exemption
provided by Para 10 of IND-AS 27.

v) Staff loans and advances have been continued at carrying value as measurement implications are immaterial.

vi) RVNL determined fair value of investment those are carried through Other Comprehensive Income through independent
valuer. Valuation of Investment of Indian Port Rail & Ropeway Corporation Limited is based on the latest available
financial statements as on 31 March 2024.

vii) Based on an expert opinion and further analysis of the underlying contractual arrangements, and in accordance with

Paragraph 62(c) of Ind AS 115 - Revenue from Contracts with Customers, the Company has determined that security

deposits and retention money are primarily performance-related. As these do not constitute a significant financing
component, discounting of these balances is no longer considered appropriate. Accordingly, this reassessment has
been classified as a change in accounting estimate under Ind AS 8, applied prospectively from the current financial
year. As a result of the change in accounting estimate, the net impact on the current year’s Statement of Profit and Loss
is a decrease in profit amounting to Rs.1.86 crore. The Company expects that similar treatment will apply to comparable
balances in future periods. However, due to variability in contract terms and differences in timing and structure of
future arrangements, it is impracticable to reliably estimate the exact quantitative impact on future periods.

Fair Value hierarchy

Level 1- Quoted prices (unadjusted) in active markets for identical assets or liabilities

Level 2- Inputs other than quoted prices included within Level 1 that are observable for the assets or liability, either
directly (i.e. as prices) or indirectly (i.e. derived form prices)

Level 3- Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs)

Fair value hierarchies of assets and liabilities as on 31 March, 2025 are as follows:

(iii) Financial risk management

The Company’s principal financial liabilities comprise
Borrowings from IRFC, trade payable and other
payables. The Company’s principal financial assets
include trade and lease receivables and cash & cash
equivalents that are derived directly from its
operations. The Company is exposed to market risk,
credit risk and liquidity risk. The Company’s financial
risk activities are governed by appropriate policies
and procedures and that financial risk are identified,
measured and managed in accordance with the
Company’s policies and risk objectives. The board of
directors reviews the policies for managing each of
these risk, which are summarised below:-

a) Market Risk

Market risk is the risk that the fair value of future cash
flows of a financial instruments will fluctuate because
of changes in market prices. Market risk comprises
Interest rate risk and foreign currency risk. Financial
instruments affected by market risk includes loans and
borrowing, deposits and other non derivative financial
instruments.

i) Interest Rate Risk

Interest rate risk is the risk that the fair value of
future cash flows of a financial instruments will
fluctuate because of change in market interest
rate. The Company has only loan from IRFC, the
payment of interest and repayment of principal
of that is ensured by the Ministry of Railways;
therefore the risk related to said loan is Nil , debt
servicing will pass through RVNL books only.

ii) Foreign Currency Risk

The Company takes services from countries
outside India for projects and is exposed to foreign
currency risk arising from such foreign currency
transactions. Due to immateriality of foreign
exchange amount group does not hedge any
risk.

b) Credit risk

Credit risk is the risk of financial loss to the Company if a
customer or counterparty to a financial instrument fails
to meet its contractual obligations, and arises
principally from the Company’s receivables from
customers. The Company is exposed to credit risk from
its financial activities including deposits with banks,
financial institutions and other financial instruments.
There is negligible risk for receivable from Ministry of
railways also company does not have any history of
bad debts.

Financial instruments and cash deposits

Credit risk from balances with banks and financial
institutions is managed in accordance with the
Company‘s policy. Investment of surplus are made
with approved counterparty on the basis of the
financial quotes received from the counterparty and
as per the gudilines issued by DPE from time to time.

c) Liquidity risk

Liquidity risk is the risk that the Company will not be
able to meet its financial obligations as they become

due. The Company manages its liquidity risk by ensuring
, as far as possible, that it will always have sufficient
liquidity to meet its liabilities when due, under both
normal and stressed conditions, without incurring
unacceptable losses or risk to the Company’s
reputation. The Company’s principal sources of
liquidity are cash and cash equivalents and the cash
flow that is generated from operations. The Company
believes that the working capital is sufficient to meet
its current operational requirements. Any short term-
surplus cash generated, over and above the amount
required for working capital management and other
operational requirements, are retained as cash and
investment in short term deposits with banks. The said
investments are made in instruments with appropriate
maturities and sufficient liquidity.

Note 33. Key sources of estimation uncertainty

The followings are the key assumptions concerning the future,
and the key sources of estimation uncertainty at the end of
the reporting period that may have a significant risk of
causing a material adjustment to the carrying amount of
assets and liabilities with next financial year.

a) Fair valuation measurement and valuation process

Impact of fair valuation of Staff loans and advances
are immaterial therefore it has been continuing at the
carrying value.

The fair values of financial assets and financial liabilities
is measured the valuation techniques including the
DCF model. The inputs to these method are taken from
observable markets where possible, but where this is
not feasible, a degree of judgment is required in
establishing fair values. Judgments include
considerations of inputs such as liquidity risk, credit risk
and volatility. Changes in assumptions about these
factors could affect the reported fair value of financial
instruments. See Note 32 for further disclosures.

b) Taxes

Deferred tax assets are recognized for unused tax losses
and unabsorbed depreciation to the extent that it is
probable that taxable profit will be available against
which losses can be utilised. Significant management
judgment is required to determine the amount of
deferred tax asset that can be recognised, based
upon the likely timing and level of future taxable profit
together with future tax planning strategies.

c ) Borrowings from IRFC and Lease Receivables from
Railway.

Company has borrowed funds from Indian Railway
Finance Corporation for the purpose of construction
of railway projects. There is a moratorium period of 3
years for each year’s loan. During the said moratorium
period, no amount on account of interest and principal
shall be payable. The interest shall be charged on
yearly basis and repayment of loan along with interest
shall made be once in a year (for a period of 12 years)
after the completion of moratorium period. Ministry of
Railways would make available to RVNL the required
funds thereafter, to enable them to do the debt
servicing. The debt servicing will pass through RVNL
books. Accordingly, funds are received by RVNL on
each year from MoR and the same is transferred to
IRFC. Therefore, there is no impact on Statement of
Profit & Loss of the Company.

1%. Customer profile include Ministry of Railways, Public Sector Enterprises and State Owned Companies in India. The
Company’s average project execution cycle is around 24 to 36 months. General payment terms include mobilisation
advance, monthly progress payments with a credit period ranging from 45 to 60 days.

ii) Contract Assets are recognised over the period in which services are performed to represent the Company‘s right to
consideration in exchange for goods or services transferred to the customer. It includes balances due from customers
under construction contracts that arise when the Company receives payments from customers as per terms of the
contracts, however the revenue is recognised over the period under input method. Any amount previously recognised
as a contract asset is reclassified to trade receivables on satisfaction of the condition attached i.e. future service which
is necessary to achieve the billing milestone.

iii) Contract liabilities relating to construction contracts are obligation to transfer goods or services to a customer for which
the entity has received consideration (or the amount is due) from the customer. These mainly arise when a particular
milestone payment exceeds the revenue recognised to date under the input method and advance received in long
term construction contracts, the amount of advance received gets adjusted over the construction period as and
when invoicing is made to the customer.

NOTE 38. CONTINGENT LIABILITIES

38.1 Claims Against the Company not acknowledged as debts:

Iln respect of claims pending under adjudication in arbitration invoked by the Contractor not acknowledged as debts by
the Company are Rs. 4,527.61 crore as at 31 March 2025 (Previous year Rs.3,364.10 crore ) and the cases pending in courts
not acknowledged as debts by the Company involve an amount of Rs.436.31 crore as at 31 March 2025 (Previous year
Rs.551.99 crore ). All the claims in case of MoR Projects, if become payable, will form part of the project cost and reimbursable
by respective clients.

38.2 Direct taxes:

Income- tax demands raised by the Income-tax department as at 31 March 2025 is aggregating to Rs. 28.00 crore (Previous
Year Rs.1241.86 crore ) and Company has not accepted the claim and submitted its appeal to department as follows:-

a) . Service TaxIn respect of Service-tax, the company has received show cause notice from Director General Goods &

Service Tax Intelligence, Delhi Zonal Unit raising a demand of Rs 279.46 crore (Previous year Rs279.46 crore ) for non¬
payment of service tax for the period from July 2012 to June 2017 under forward/reverse charge mechanism on
services provided/ received to/by Ministry of Railway and Zonal Railways contested by the company. The Company
has received order from Additional Director General(Adjudication) dated 24.08.2021 reduced the demand to 148.68
crore plus applicable interest and imposed penalty of Rs. 130.78 crore .The Company has filed an appeal before
CESTAT, New Delhi against the said demand. If the liability is decided against the Company in future ,the same will be
borne by Ministry of Railways.

b) . GST:GST dapartment has rasied demands of Rs. 244.59 crore (Previous Year Rs. 124.38 crore ). However, the Company

has not accepted the demand and submitted its representation/appeal to department as follows:-

NOTE 39. CAPITAL COMMITMENT:

- Office Premise at World Trade Center, Nauroji Nagar New Delhi being constructed by NBCC Rs. 50.54 crore incl. GST
(Previous Year: Rs.60.68 crore)

- Implementation of ERP is Nil (Previous Year: Rs. 1.01 crore)

39.1 Other Commitment

Commitment towards Contractual Payments of Project expenditure is Rs. 42,871.50 crores (Previous Year: Rs.31,763.85 crore).
-Contribution towards share capital in Subsidiaries, Joint Venture & Associates is Rs. 331.49 crore (Previous Year: Rs. 34.96 crore).

The Concession Agreement was signed between NHAI and M/s Malkanai Paradeep Road Vikas Limited on 10.10.2023 for
“Rehabilitation and Upgradation from 4 to 8 laning of Chandikhole-Paradip Section of NH-53 (Old NH-5A) from Km. 80.000 to
Km. 76.646 (Package-4)(2nd call)" in the state of Odisha on HAM Mode. The Authority awarded the above project to RVNL
at a total project cost of Rs. 808.48 Crore. Malkanai Paradeep Road Vikas Limited entered into an EPC Agreement on
24.04.2024 with Rail Vikas Nigam Limited and agreed to award 100% of the EPC works, for a total of Rs. 661.11 Crores excluding
GST to RVNL for executing the construction. Till date Rs. 59.80 has been paid to RVNL towards achievement of first mile stone.
Balance Rs. 601.36 crores will be delivered in due course.

i) One of the former employees Mr. Devendra Singh on deputation from Indian Railways has filed a writ petition on
22.07.2010 against the Company in respect of dues on account of difference in pay scales. The impact of the same has
not been quantified in the writ.

ii) During the financial year 2014-15, Company received a show cause notice from the Director General of Central Excise
Intelligence, regarding the liability of Service Tax of Rs. 213.59 Crores and interest and penalty thereon. The Company
has not accepted the liability and has submitted its reply to the Show Cause Notice on 06.01.2015. A personal hearing
has also been held in this regard on 21.09.2015 before the Principal Commissioner of Service Tax, Delhi-I. A similar
statement of demand cum show cause notice has also been received for F. Yr. 2014-15 on 05.04.2016 in which a
demand of Rs. 82.07 Crores has been raised. It has also been replied on 24.05.2016. For FY 2015-16, 2016-17, 2017-18
(upto 30.06.2017), the statement of demand cum show cause notice in which a total demand of Rs. 211.66 Crores cum
show cause notice was served on 22.03.2018, which was replied on 18.05.2018. During the current financial year
department has communicated that matter is kept in abeyance in view of the appeal on the identical issue filed by
the department in the case of M/s Mundra port and special economic zone limited before the Hon’ble supreme court.

iii) As per the Construction Agreement for Palanpur-Samakhiali doubling , there is a provision for contingencies of 0.5% as
mentioned in estimated project cost.

iv) As per the Construction Agreement between RVNL and Kutch Railway Company Limited, If expenditure is incurred by
RVNL out of its own funds on the project executed on behalf of KRC, on account of the failure of KRC to make payment
to RVNL within 15 days of dispatch of intimation of requirement of additional funds, then RVNL shall charge interest at
the prevailing Base Rate of SBI 1% on the total amount so expended. The interest to be charged shall be fixed from
the 16th day after dispatch of demand for required funds and charged up to the date of actual payment is received
from KRC During the current financial year, Company has written the letter to the RVNL and challenged the interest
calculation method adopted by the RVNL. Further board of directors in the 106th meeting held on 23th August 2024 is
of the view that the levy of interest by RVNL for delayed payment beyond the original estimate cost of Rs. 1548.66 crores
should not be made on the basis of RVNL demand for funds. Interest should not be charged till the Revised estimate (1st
or 2nd) is sanctioned by KRCL Board and a period of 2 years has passed which is required by KRCL to mobilise the funds
for the cost overrun. Based on this, Company has not accepted the interest charged by the RVNL after Sep 2023
accordingly interest of amounting Rs. 45.37 Crores under the Project of doubling of Palanpur - Samakhyali Section and
interest of amounting Rs. 16.42 Crores under Project of electrification of Palanpur - Samakhyali Section has not been
provided in the Financial statements till FY 2024-25.

v) In case of the Project of electrification of Palanpur - Samakhyali Section the estimated cost of the project is Rs. 755.00
crore , however the company has received the expenditure amounting of Rs 759.52 crores from the RVNL till 31 March
2025. Company has not accepted the liability in excess of the estimated amount of the project cost.

(i) Department has raised demand in respect of alleged offence of evasion of Service Tax amounting to Rs.7.58 Crores
and Rs. 2.86 Crores for financial year 2014-15 and 2015-16 respectively. Also department has raised demand of Rs. 2.95
Crores for the FY 2016-17 and 2017-18 (upto June’17), However Company has not accepted the liability and has
submitted its reply to department. Since the Company had earlier received favourable ruling from CESTAT, it is
confident that no additional liability will devolve on it. Further for the period FY 2011-12 to FY 2013-14, KRCL has
received favourable order from CESTAT for demand of 13.42 Crores. In case of similar companies on same matter
department has moved to Hon’ble Supreme court in this case.

(ii) During the FY 2019-20 Income Tax Department has moved to Hon’ble High Court of Delhi in respect of Tax demand of
Rs. 5.17 Crores for A.Y. 2011-12, Company has already received favourable order from ITAT in this case. Therefore, liability
for this case has not been recorded in the books of Accounts.

(iii) Arbitration proceedings between KRCL and MOR (Respondent) is on going. As against the KRCL’s claim, MoR has also
filed counter claims. It is to be stated that as per Section 42A of The Arbitration and Conciliation Act 1996, Either Arbitral
details of proceedings or of Claims ought to be kept confidential by the parties till the same is concluded. Therefore,
KRCL is not in a position to disclose details of Arbitration proceedings including claims of KRCL/counter claims of MoR in
Financial Statements.

(iv) During the previous years, company has received certain bills under protest from contractor pertaining to phase 1 on
which a future liability may arise. Financial impact of the same is not ascertainable at present.

(v) Contingent liability in respect of departmental charges not claimed by RVNL @ 5% of project cost is estimated at 114.49
Crores.

(i) The Company had received a Show Cause Notice (SCN) during financial year 2014-1 5 from tax authorities in the
matter of applicability of service tax on the Company in respect of apportionedfreight received by the Company from
Railways. The SCN covered a period of three years fromfinancial year 2011-12 to financial year 2013-14 and involved
service tax of Rs. 16.33 Crores plus interest and penalties. The Company contested the SCN and submitted its position
through are joinder thereon to the adjudicating authorities, pleading that no service is rendered by BDRCLto Western
Railway that might warrant liability to pay Service Tax. The Company got relief and favorable order from the Commi
ssioner of Service Tax vide her order dated 25 01.2016 and has therefore not provided for the amount in the aforesaid
claim its books for the above period. However, the department has filed appeal with CESTAT against the order of
Commissioner for 25/03/2019 rejected the appeals filed by department. The Department has filed a appeal in Hon’ble
Supreme Court against the order of CESTAT in response to the same the company has submitted a statement in
Hon’ble Supreme Court.The tax authorities issued another SCN npany on the same grounds of involving a demand of
Rs. 16.38 Crores plus interest and penalties for the FY 2014-15. The company has duly submitted its reply to the
adjudicating authorities for withdrawal of the claim in the aforesaid SCN on the same grounds as pleaded in the earlier
rejoinder. Since the Company’s stand is based on sound principles and immutable facts, and it had received a
favourable ruling from the Commissioner of Service Tax. on the earlier occasion, it is confident that no additional
liability on account of Service Tax will devolve on it. The Company has not yet received any adjudication order in the
matter. Further, the tax authorities issued another SCN to the Company on the same grounds involving a demand of
Rs. 16.15 Crores plus interest and penalties for FY 2015-16 on 21 March 2018, the company has duly submitted its reply
to the adjudicating authorities for withdrawal of the claim in the aforesaid SCN on the same grounds as pleaded in the
earlier rejoinder.

Furthermore, the tax authorities issued another SCN to the Company on the same grounds involving a demand of Rs
8.99 Crores plus interest and penalties for FY 2016-17 & 2017-18 (Upto Jun-17) on 22th April 2019. The company has duly
submitted its reply to the adjudicating authorities for withdrawal of the claim in the aforesaid SCN on the same grounds
as pleaded in the earlier rejoinder.

(ii) The O & M expenditure pertaining to Bharuch-Chavaj section has been provided in financial statement to the extent
information provided by Western Railway and information available with company, remaining O & M will be provided
in the year in which information will be received from Railways.

(iii) Company has terminated some contractual employees, due to misconduct at workplace and unauthorised absence
from office, aggreived by the decision of the company employees have filed application with labour court for
compensation towards their termination. However, based on the facts of the case, company expects favourable
decision. Financial impact of the same is not ascertainable.

(iv) The Company has received a claim of Rs. 6.96 Crores from Rail Vikas Nigam Limited (RVNL) pertaining to an arbitral
award for the construction of the BDRCL Project under construction agreement for the gauge conversion of the
Bharuch-Samni-Dahej Section. Out of this, Rs. 5.51 crore has been accepted and paid by the Company. However,
the remaining amount of Rs. 1.45 Crores has not been accepted by the Company, and the necessary facts in this
regard have been intimated to RVNL.

(v) The Company had received a claim of Rs 6.96 Crores from Rail Vikas Nigam Limited (RVNL) pertaining to arbitral award
for construction of BDRCL Project under construction agreement for gauge conversion of Bharuch Samni-Dahej Section.
The claim of Rs 5.51 Crores has been accepted and paid by the company. The remaining amount of Rs. 1.45 Crores has
not been accepted by the Company and the necessary facts in this regard have been intimated to RVNL.Till date
there is no details and clarification on the same is received from RVNL

Capital commitment: (Share of RVNL:35.46%)

(i) Capital commitment in respect of S&T Work-project Rs. 4.49 crore (Previous year Rs. 4.59 crore)

(i) During the financials year 2022-23, Company had received a show cause notice dated 23.12.2022 from the Principal
Commissioner (Audit) Central GST & Central Excise Bhubaneshwar ,regarding the liability of irregular availment of ITC
amounting Rs 209.02 Crores along with the interest under section 50 of the CGST Act, 2017 and also Penalty under
Section 73 af the CGST Act. The Company had appeared before the Principal Commissioner (Audit) Central GST &
Central Excise Bhubaneshwar for adjudication. An order has ised by the Adjudicating Authority on 30-11-23 against the
company. Therefore, the Adjudicating authority has imposed interest of Rs. 4.10 Crores and penalty of Rs. 20.90 crores
under GST Act, 2017. However, the company has filed appeal against the order on 7th March, 2024.

(ii) During the financial year 2024-25, the Company received another show cause notice dated 16.01.2025 from the
Additional Commissioner (Adjudicating Authority), GST & Central Excise, Bhubaneswar, confirming a demand of GST of
Rs. 3.31 Crores with interest under Section 50 of the CGST Act, 2017 and penalty under Section 73 of the CGST Act. As
the amount was already paid by utilisation of ITC and the same was also confirmed by the Adjudicating Authority
while passing the order, the Company is in the process of filing an appeal against the order.

(iii) Additionally, during the financial year 2024-25, the Company received a third show cause notice dated 14.02.2025
from the Commissioner (In-Situ Audit), Central GST & Central Excise, Bhubaneswar, regarding the liability for wrongful
availment of ITC amounting to Rs. 12.27 Crores along with interest under Section 50 of the CGST Act, 2017 and penalty
under Section 73 of the CGST Act. The Company has not accepted the liability and has submitted a reply to the notice
with the GST Department.

(iv) Furthermore, an income tax demand of Rs. 0.86 crores and interest of Rs. 0.65 crores for the AY 2017-18 is showing on the
income tax portal. The Company has not agreed with the tax demand and has requested the Income Tax Department
to rectify the mistake under Section 154 of the IT Act.

Capital commitment: (Share of RVNL:36.44%)

The capital commitment in respect of cost to be incurred for assets covered by the Service Concession Arrangement is Rs.

45.73 crore as of 31 March 2024. For comparison, the capital commitment as of 31 March 2023 was Rs. 399.74 crore.

f). Dighi Roha Rail Limited

Note 46.

(a) The Company usually receives advance payment from Joint Venture Companies for incurring expenditure on their
projects. However, in the case of one joint venture company i.e. Krishnapatnam Railway Company Limited (KRCL),
the Company is incurring project expenditures on a regular basis and the total amount receivable from KRCL as on 31
March, 2025 is Rs.1355.72 crore which includes Rs. 889.95 crore on account of Interest. The application of interest has
been changed from compound to simple w.e.f 1 October 2024, whereas KRCL requested for application of simple
interest w.e.f. 01.04.2020. The matter is pending with the Board of Directors of the Company and adjustment if any will
be recognized as and when the matter is finalized.

(b.) In view of the representation made by one of the Joint Venture Company KRCL for the waiver of departmental
charges and pending decision by the Board of Directors of the Parent Company, the claim for departmental charges
5% of the completion cost of the project has not been raised on KRCL by the Company. The matter is pending with the
Board of Directors of the Company and adjustment if any will be recognized as and when the matter is finalized.

Note 47. Segment Reporting as per IND AS 108

General Information

Operating segments are defined as components of an enterprise for which discrete financial information is available which

is being evaluated regularly by the Chief Operating Decision Maker (CODM) in deciding how to allocate resources and

assessing performance. Chairman and Managing Director of the company has been identified as CODM.

The company has identified one reportable operating segments as "Development of Rail Infrastructure".

Information about reportable segments and reconciliation to amounts reflected in the financial statement:

Income and expenses directly attributable to segments are reported under the respective operating segment. Income and

Expenses which are not directly identifiable have been disclosed as un-allocable expenses or income.

Note 49. Additional reporting requirement (Schedule III):

(i) The Company does not have any Benami Property and further no proceedings has been initiated or pending against
the Company for holding any Benami property.

(ii) The Company does not have any transactions with companies struck off.

(iii) The Company does not have any pending charges or satisaction to be registered with ROC.

(iv) The Company has not traded or invested in Crypto Currency or Virtual Currency during the financial year.

( v) 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 Act, 1961 (such as search
or survey or any other relevant provisions of the Income Tax Act, 1961).

(vi) The Company has not been classified as willful defaulter by the Bank or Financial Instituitions

(vii) The Realisable Value of financial assets of the Company is not lower than value disclosed in financial statements and
subject to confirmation.

(viii) The following disclosures shall be made where loans or advances in the nature of loans are granted to promoters,
directors, KMPs and the related parties (as defined under Companies Act, 2013), either severally or jointly with any
other persons , that are :

(a) . Repayable on demand; or

(b) . Without specific any terms or period of repayment

Note 50. Operating Cycle

Based on the time involved between the acquisition of assets for processing and their realisation in cash and cash equivalents,
the Company has determined twelve months as its operating cycle for the purpose of classification of its assets and liabilities
as current and non-current in the balance sheet.

Note 51.

Balances of some of the Trade receivables, Other assets, Trade and Other payables accounts are subject to confirmations/
reconciliations and consequential adjustment, if any. Reconciliations are carried out on on-going basis. Provisions, wherever
considered necessary, have been made. However, management does not expect to have any material financial impact
of such pending confirmations/reconciliations.

# Tangible Net worth Total Debt Deferred Tax Liability
## Held as investment as per note 6.1

Capital employed (Rs in crore) 14,012.74 13,855.05

Note 53.

Previous year figures has been reaaranged, reclassified and regrouped to make them confirmatory with current year reported
figures.

As per our Report of even date attached For and on behalf of Board of Directors

For Gandhi Minocha & Co. Sd/- Sd/-

Chartered Accountants Sanjeeb Kumar Pradeep Gaur

Firm Registration No.: 00458N Director Finance Chairman & Managing Director

DIN: 03383641 DIN: 07243986

Sd/- Sd-

(CA Manoj Bhardwaj) Kalpna Dubey

Partner Company Secretary

M.No. 098606 FCS No. F7396

Place : New Delhi
Date: 21.05.2025