(xiii) Provisions, Contingent Liabilities and
Contingent Assets
Provisions are recognized when the Company has a present
legal or constructive obligation as a result of past events, it is
probable that an outflow of resources embodying economic
benefits will be required to settle the obligation and the
amount can be reliably estimated. The expense relating to
a provision is presented in the Statement of Profit and Loss,
net of any reimbursements.
The amount recognized as a provision is the best estimate
of the consideration required to settle the present obligation
at the end of the reporting period, taking into account the
risks and uncertainties surrounding the obligation. When
a provision is measured using the cash flows estimated
to settle the present obligation, it carrying amount is the
present value of those cash flows (when the effect of the
time value of money is material).
A present obligation that arises from past events, where it
is either not probable that an outflow of resources will be
required to settle or a reliable estimate of the amount cannot
be made, is disclosed as a contingent liability. Contingent
liabilities are also disclosed when there is a possible
obligation arising from past events, the existence of which
will be confirmed only by the occurrence or non-occurrence
of one or more uncertain future events not wholly within the
control of the Company.
Claims against the Company, where the possibility of
any outflow of resources in settlement is remote, are not
disclosed as contingent liabilities.
Contingent assets are not recognized in standalone financial
statements since this may result in the recognition of income
that may never be realized. However, when the realization
of income is virtually certain, then the related asset is not a
contingent asset and is recognized.
Provisions, contingent liabilities and contingent assets are
reviewed at each Balance Sheet date.
(xiv) Employee Benefits
Short-term benefits
Short-term benefit obligations are measured on an
undiscounted basis and are expensed as the related
service is provided. A liability is recognized for the amount
expected to be paid if the Company has a present legal or
constructive obligation to pay this amount as a result of past
service provided by the employee and the obligation can be
estimated reliably.
Defined contribution plans
The Company makes defined contributions to the
Government Employee Provident Fund, which is recognized
in the Statement of Profit and Loss, on an accrual basis. The
Company recognizes contribution payable to the provident
fund scheme as an expense when an employee renders the
related service. The Company has no obligation other than
the contribution payable to the provident fund.
Defined benefit plans
The Company's liabilities under The Payment of Gratuity
Act, 1972 are determined on the basis of actuarial valuation
made at the end of each financial year using the projected
unit credit method.
The Gratuity obligation is unfunded. Obligation is measured
at the present value of estimated future cash flows using a
discounted rate that is determined by reference to market
yields at the Balance Sheet date on Government bonds,
where the terms of the Government bonds are consistent
with the estimated terms of the defined benefit obligation.
The net interest cost is calculated by applying the discount
rate to the defined benefit obligation. This cost is included in
the 'Employee benefits expense' in the Statement of Profit
and Loss.
Re-measurement gains or losses arising from changes
in actuarial assumptions are recognized in the period in
which they occur, directly in OCI. These are presented
as re-measurement gains or losses on defined benefit
plans under other comprehensive income in other equity.
Remeasurement gains or losses are not reclassified
subsequently to the Statement of Profit and Loss.
Compensated absences
The employees of the Company are entitled to compensated
absences. Accumulated compensated absences, which
are expected to be encashed beyond twelve months from
the end of the year, are treated as long-term employee
benefits. Liability for such benefit is provided on the basis
of actual leave balance as at the Balance Sheet date. The
Company records an obligation for compensated absences
in the period in which the employee renders the services
that increases this entitlement. The Company measures the
expected cost of compensated absences as the additional
amount that the Company expects to pay as a result of the
unused entitlement that has accumulated at the end of the
reporting period. The Company recognizes accumulated
compensated absences based on actuarial valuation in the
Statement of Profit and Loss.
(xv) Financial instruments
A financial instrument is any contract that gives rise to a
financial asset for one entity and a financial liability or equity
instrument for another entity.
Financial assets and liabilities are recognized when the
Company becomes a party to the contractual provisions of
the instrument.
Financial assets:
Initial recognition and measurement
Financial assets are classified, at initial recognition, and
subsequently measured at amortised cost, fair value through
other comprehensive income (OCI), and fair value through
profit or loss.
The classification depends on the Company's business
model for managing the financial assets and the contractual
terms of the cash flows.
Subsequent measurement
For purposes of subsequent measurement, financial assets
are classified in following categories:
• Debt instruments at amortised cost
• Debt instruments, derivative financial instruments and
equity instruments at fair value through profit or loss
(FVTPL)
• Equity instruments measured at fair value through other
comprehensive income (FVTOCI)
Debt instruments at amortised cost
A 'debt instrument' is measured at the amortised cost if both
the following conditions are met:
a) The asset is held within a business model whose
objective is to hold assets for collecting contractual
cash flows, and
b) Contractual terms of the asset give rise on specified
dates to cash flows that are solely payments of
principal and interest (SPPI) on the principal amount
outstanding.
This category is the most relevant to the Company. After
initial measurement, such financial assets are subsequently
measured at amortised cost using the effective interest rate
(EIR) method. Amortised cost is calculated by taking into
account any discount or premium on acquisition and fees or
costs that are an integral part of the EIR. The EIR amortisation
is included in finance income in the standalone statement
of profit and loss. The losses arising from impairment are
recognised in the statement of profit and loss.
Debt instrument at FVTPL
FVTPL is a residual category for debt instruments. Any
debt instrument, which does not meet the criteria for
categorization as amortized cost or as FVTOCI, is classified
as FVTPL.
Debt instruments included within the FVTPL category are
measured at fair value with all changes recognised in the
profit and loss.
The Company classifies its debt instruments which are held
for trading under FVTPL category. Held for trading assets are
recorded and measured in the Balance Sheet at fair value.
Gains and losses on changes in fair value of debt instruments
are recognised on net basis through profit or loss.
Debt instrument at FVTOCI
A debt instrument is subsequently measured at fair value
through other comprehensive income if it is held within
a business model whose objective is achieved by both
collecting contractual cash flows and selling financial assets
and the contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
Derecognition of financial assets
A financial asset (or, where applicable, a part of a financial
asset or part of a group of similar financial assets) is primarily
derecognised (i.e. removed from the Company's balance
sheet) when:
• The rights to receive cash flows from the asset have
expired, or
• 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.
Impairment of financial assets
The Company applies expected credit loss (ECL) model for
measurement and recognition of impairment loss on the
following financial assets and credit risk exposure:
a) Financial assets that are debt instruments, and are
measured at amortised cost e.g., loans, debt securities,
deposits and bank balances.
b) Trade receivables or any contractual right to receive
cash or another financial asset that result from
transactions that are within the scope of Ind AS 115.
The Company follows 'simplified approach' for recognition
of impairment loss allowance on:
• Trade receivables or contract revenue receivables;
Under the simplified approach the Company does not track
changes in credit risk. Rather, it recognises impairment loss
allowance based on lifetime ECLs at each reporting date,
right from its initial recognition.
For recognition of impairment loss on other financial assets
and risk exposure, the Company determines that whether
there has been a significant increase in the credit risk since
initial recognition. If credit risk has not increased significantly,
12-month ECL is used to provide for impairment loss.
However, if credit risk has increased significantly, lifetime
ECL is used.
ECL is the difference between all contracted cash flows that
are due to the Company in accordance with the contract
and all the cash flows that the Company expects to receive,
discounted at the original EIR. ECL impairment loss allowance
(or reversal) recognised during the period is recognised as
income/(expense) in the statement of profit and loss (P&L).
The balance sheet presentation for various financial
instruments is described below:
Financial assets measured as at amortised cost and
contractual revenue receivables
ECL is presented as an allowance, i.e., as an integral part of
the measurement of those assets in the balance sheet. The
allowance reduces the net carrying amount. Until the asset
meets write-off criteria, the Company does not reduce
impairment allowance from the gross carrying amount.
For assessing increase in credit risk and impairment loss,
the Company combines financial instruments on the basis
of shared credit risk characteristics with the objective of
facilitating an analysis that is designed to enable significant
increases in credit risk to be identified on a timely basis.
Financial liabilities
Initial recognition, measurement and presentation
Financial liabilities are classified, at initial recognition, as
financial liabilities at fair value through profit or loss, loans
and borrowings, payables or derivatives, as appropriate.
All financial liabilities are recognised 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 trade payables,
loans and borrowings including bank overdrafts, other
financial liabilities and derivative financial instruments.
For purposes of subsequent measurement, financial liabilities
are classified in two categories:
• Financial liabilities at fair value through profit or loss.
• Financial liabilities at amortised cost (loans and
borrowings).
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include
financial liabilities held for trading and financial liabilities
designated upon initial recognition at fair value through
profit or loss. Financial liabilities are classified as held for
trading if they are incurred for the purpose of repurchasing in
the near term. This category also includes derivative financial
instruments entered into by the Company that are not
designated as hedging instruments in hedge relationships as
defined by Ind AS 109.
Gains or losses on liabilities held for trading are recognised in
the statement of profit and loss.
Financial liabilities designated upon initial recognition at fair
value through profit or loss are designated as such at the
initial date of recognition, and only if the criteria in Ind AS
109 are satisfied. For liabilities designated as FVTPL, fair
value gains/ losses attributable to changes in own credit risk
are recognised in OCI. These gains/ loss are not subsequently
transferred to profit or loss. However, the Company may
transfer the cumulative gain or loss within equity. All other
changes in fair value of such liability are recognised in the
statement of profit and loss.
The Company classifies its debt instruments which are held
for trading under FVTPL category. Held for trading assets are
recorded and measured in the Balance Sheet at fair value.
Gains and losses on changes in fair value of debt instruments
are recognised on net basis through profit or loss.
Loans and borrowings
After initial recognition at fair value, interest-bearing loans
and borrowings are subsequently measured at amortised
cost using the EIR method. Gains and losses are recognised
in the statement of profit and loss when the liabilities are
derecognised as well as through the EIR amortisation
process.
Amortised cost is calculated by taking into account any
discount or premium on acquisition and fees or costs that are
an integral part of the EIR. The EIR amortisation is included
as finance costs in the statement of profit and loss.
This category generally applies to borrowings.
Derecognition of financial liabilities
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 the derecognition of
the original liability and the recognition of a new liability. The
difference in the respective carrying amounts is recognised
in the statement of profit and loss.
Offsetting financial instruments
Financial assets and liabilities are off-set and the net amount
is reported in the Balance Sheet where there is a legally
enforceable right to offset the recognized amounts and
there is an intention to settle on a net basis or realize the
asset and settle the liability simultaneously.
Derivative financial instruments
The Company uses derivative financial instruments, such
as foreign exchange forward contracts, and interest rate
swap to manage its exposure to interest rates and foreign
exchange risks. Such derivative financial instruments are
initially recognized at fair value on the date on which a
derivative contract is entered into and are subsequently re¬
measured at fair value.
Derivatives are carried as financial assets when the fair value
is positive and as financial liabilities when the fair value is
negative.
The Company enters into derivative contracts to hedge
risks which are not designated in any hedging relationship
i.e., hedge accounting is not followed. Such contracts are
accounted for at FVTPL.
(xvi) Cash and cash equivalent
Cash and cash equivalent in the balance sheet comprise
cash at banks and on hand and short-term deposits with
an original maturity of three months or less, that are readily
convertible to a known amount of cash and subject to an
insignificant risk of changes in value.
For the purpose of the statement of cash flows, cash and
cash equivalents consist of cash and short-term deposits,
as defined above, net of outstanding bank overdrafts as
they are considered an integral part of the Company's cash
management.
(xvii) Cash dividend to equity holders
The Company recognises a liability for payment of dividend
to equity holders when the distribution is authorised and the
distribution is no longer at the discretion of the Company.
As per the corporate laws in India, a distribution is authorised
when it is approved by the shareholders. A corresponding
amount is recognised directly in equity.
(xviii) Earnings per share
Basic earnings per share are calculated by dividing the
profit for the period attributable to equity shareholders by
the weighted average number of equity shares outstanding
during the period.
For the purpose of calculating diluted earnings per share, the
profit for the period attributable to equity shareholders and
the weighted average number of shares outstanding during
the period are adjusted for the effects of all dilutive potential
equity shares.
(xix) Segment Information
Operating segments are reported in a manner consistent
with the internal reporting provided to the chief operating
decision-maker. The Chief Operating decision-maker is
responsible for allocating resources and assessing the
performance of the operating segments and makes strategic
decisions.
(xx) New accounting standards, amendments
and interpretations adopted by the Company
effective from April 1, 2024:
The accounting policies adopted in the preparation of the
standalone financial statements are consistent with those
followed in the preparation of the Company's annual financial
statements for the year ended March 31, 2024, except for
amendments to the existing Indian Accounting Standards
(Ind AS). The Company has not early adopted any other
standard, interpretation or amendment that has been issued
but is not yet effective.
The Ministry of Corporate Affairs notified new standards or
amendment to existing standards under Companies (Indian
Accounting Standards) Rules as issued from time to time.
The Company applied following amendments for the first¬
time during the current year which are effective from
April 1, 2024:
Introduction of Ind AS 117:
MCA notified Ind AS 117, a comprehensive standard
that prescribe, recognition, measurement and disclosure
requirements, to avoid diversities in practice for accounting
insurance contracts and it applies to all companies i.e., to all
"insurance contracts" regardless of the issuer. However, Ind
AS 117 is not applicable to the entities which are insurance
companies registered with IRDAI.
Additionally, amendments have been made to Ind AS 101,
First-time Adoption of Indian Accounting Standards, Ind
AS 103, Business Combinations, Ind AS 105, Non-current
Assets Held for Sale and Discontinued Operations, Ind
AS 107, Financial Instruments: Disclosures, Ind AS 109,
Financial Instruments and Ind AS 115, Revenue from
Contracts with Customers to align them with Ind AS 117.
The amendments also introduce enhanced disclosure
requirements, particularly in Ind AS 107, to provide clarity
regarding financial instruments associated with insurance
contracts.
Amendments to Ind AS 116-Lease liability in a sale
and leaseback:
The amendments require an entity to recognise lease liability
including variable lease payments which are not linked to
index or a rate in a way it does not result into gain on Right
of use asset it retains.
The Company has reviewed the new pronouncements
and based on its evaluation has determined that these
amendments do not have a significant impact on the
Company's Standalone Financial Statements.
1D. SIGNIFICANT ACCOUNTING JUDGEMENTS,
ESTIMATES AND ASSUMPTIONS
The preparation of standalone financial statements in
conformity with Ind AS requires management to make
judgements, estimates and assumptions, that affect the
application of accounting policies and the reported amounts
of assets, liabilities, income and expenses at the date of
these standalone financial statements and the reported
amounts of revenues and expenses for the year presented.
Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed at each
balance sheet date. Revisions to accounting estimates are
recognized in the period in which the estimate is revised and
future periods affected.
Estimates and judgments involved in applying accounting
policies, is in respect of:
• Useful lives of property, plant and equipment
and Intangible assets
Determination of the estimated useful lives of tangible
and intangible assets and the assessment as to which
components of the cost may be capitalized. Useful lives of
tangible assets are based on the life prescribed in Schedule
II of the Companies Act, 2013.
• Taxes
There are many transactions and calculations undertaken
during the ordinary course of business for which the
ultimate tax determination is uncertain. Where the final tax
outcome of these matters is different from the amounts
initially recorded, such differences will impact the current
and deferred tax provisions in the period in which the tax
determination is made. The assessment of probability
involves estimation of a number of factors including future
taxable income.
• Defined benefit plans (gratuity benefits)
A liability in respect of defined benefit plans is recognised in
the balance sheet, and is measured as the present value of
the defined benefit obligation at the reporting date less the
fair value of the plan's assets. The present value of the defined
benefit obligation is based on expected future payments
at the reporting date, calculated annually by independent
actuaries. Consideration is given to expected future salary
levels, experience of employee departures and periods of
service. Refer note 28 for details of the key assumptions
used in determining the accounting for these plans.
• Discounts, rebates and sales returns
The Company recognises the accruals for rebates/ discount/
incentives and returns based on accumulated experience
and underlying schemes and agreements with customers.
Notes:
(1) In case of work-in-progress (including intermediate goods), during the year ended March 31, 2025 ' 1.38 millions
(March 31, 2024'5.35 millions) was recognised as expense for inventories at net realizable value.
(2) In case of finished goods, during the year ended March 31, 2025'1.71 millions (March 31, 2024'3.45 millions) was
recognised as expense for inventories at net realizable value.
(3) Finished goods includes goods in transit ' 103.60 millions (March 31, 2024'20.46 millions).
(4) Stock in trade includes goods in transit ' 9.15 millions (March 31, 2024'0.01 millions).
(5) The secured cash credit facilities are covered by paripassu charge on inventories (including raw material, finished goods
and work-in-progress) and trade receivables (refer note 14).
(6) The above includes inventories held by third parties amounting to ' 91.33 millions (March 31, 2024'87.14 millions).
(7) The mode of valuation of inventories has been stated in note 1C(xi).
14. BORROWINGS (Contd.)
Details of terms and securities for the above
borrowing facilities are as follows:
1) Cash Credit from State Bank of India amounting to
' 6.82 millions (P.Y ' 174.23 Million) is secured by
Hypothecation and pari passu first charge on entire
present and future asset of the comapny comprises of
stocks & receivables and equitable mortgage of Factory
land & buildings: Plot no 408,409,410 & 411 at kerala
GIDC, Bavla, Ahmedabad; Office Building: 901 to 903
& 911, B-square-2, Iscon Ambli Road, Ahmedabad.
The cash credit facility carries interest rate linked to 6
months MCLR Plus spread of 0.30%. (March 31, 2024:
6 months MCLR Plus spread of 0.30%). The effective
interest rate is 9.15% (March 31, 2024: 8.85%).
2) The term loan from State Bank of India amounting
to ' 296.85 millions (P.Y ' 366.27 Million) for
construction & establishment of saykha technical
manufacturing plant, secured by Hypothecation of all
the plant & machineries, utility item, furniture fixture,
lab items, misc fixed assets created out of credit
facilities extended by bank situated at Plot no. DP/154
Saykha to Saran Village Road Saykha industrial Estate
GIDC Mouje Saykha Bharuch and equitable mortgage
of Factory land & buildings : Plot no 408, 409, 410
& 411 at Kerala GIDC, Bavla, Ahmedabad; Factory
land and building situated at Plot no. DP/154 Saykha
to Saran Village Road Saykha industrial Estate GIDC
Mouje Saykha Bharuch; Office Building: 901 to 903 &
911, B-square-2, Iscon Ambli Road, Ahmedabad. The
loan carries interest rate linked to 6 months MCLR plus
spread of 0.30%. (March 31,2024: 6 months MCLR
plus spread of 0.30%) The effective interest rate is
9.20% (March 31, 2024: 8.80%). The loan is repayable
in 64 monthly installments commencing from February
2024.
All the credit facilities extended by State Bank of India
is also secured by personal guarantee of Manjulaben
Rameshbhai Talavia, Muktaben Jamankumar
Talaviya,Vishalbhai H Domadia, Jagdish R Savaliya,
Rameshbhai R Talavia, Jamankumar H Talavia.
3) Cash Credit from HDFC Bank amounting to
' 287.47 millions (P.Y ' 61.74 million) is secured by
Hypothecation of stocks, debtors, plant & machinery
and equitable mortgage of Factory land & buildings:
Plot no 408,409,410 & 411 at kerala GIDC, Bavla,
Ahmedabad; Factory land and building situated at
Plot no. DP/154 Saykha to Saran Village Road Saykha
industrial Estate GIDC Mouje Saykha Bharuch; Office
Building: 901 to 903 & 911, B-square-2, Iscon Ambli
Road, Ahmedabad. The effective interest rate is 8.19%.
(March 31, 2024: 8.37%).
4) The term loan from HDFC bank amounting to ' 460.57
millions (P.Y ' 500 Million) is sanctioned for construction
& establishment of saykha technical manufacturing
plant, secured by Hypothecation of plant & machinery
and equitable mortgage of Factory land & buildings
situated at Plot no. 408,409,410 & 411 at kerala GIDC,
Bavla, Ahmedabad; Factory land and building situated
at Plot no. DP/154 Saykha to Saran Village Road Saykha
industrial Estate GIDC Mouje Saykha Bharuch; Office
Building situated at 901 to 903 & 911, B-square-2,
Iscon Ambli Road, Ahmedabad. The effective interest
rate is 8.02%. (March 31, 2024: 8.36%). The loan is
repayable in 109 monthly installments commencing
from April 2024.
All the credit facilities extended by HDFC Bank is
also secured by personal guarantee of Manjulaben
Rameshbhai Talavia, Muktaben Jamankumar
Talavia,Vishalbhai H Domadia, Jagdish R Savaliya,
Rameshbhai R Talavia, Jamankumar H Talavia.
5) The unsecured loans from directors & others are
repayable on demand when there is surplus cash
available with the company. Based on the management's
assessment of repayment the same has been classified
as current as at March 31, 2025.
6) Vehicle loans are secured against the same vehicles
for which loan is taken. All vehicle loan are repayable
in 60 monthly installments commencing from date of
sanction. The loan carries fixed interest rate of 7.25%-
9.10%.
7) Company has availed Buyer's credit interchangeably
with Letter of credit facility from HDFC bank amounting
to ' 97.29 (P.Y: Nil) millions, secured by Hypothecation
of plant & machinery and equitable mortgage of Factory
land & buildings situated at Plot no 408,409,410 & 411
at kerala GIDC, Bavla, Ahmedabad; Factory land and
building situated at Plot no. DP/154 Saykha to Saran
Village Road Saykha industrial Estate GIDC Mouje
Saykha Bharuch; Office Building situated at 901 to 903
& 911, B-square-2, Iscon Ambli Road, Ahmedabad.
The buyer's credit facility carries interest rate linked to
SOFR PLUS 175 bps.The interest rate for buyer's credit
ranges from 6.09% - 6.26%. The buyer's credit / Letter
of credit carries bank charges at 1% p.a.
All the credit facilities extended by HDFC Bank is
also secured by personal guarantee of Manjulaben
Rameshbhai Talavia, Muktaben Jamankumar Talaviya,
Vishalbhai H Domadia, Jagdish R Savaliya, Rameshbhai
R Talavia, Jamankumar H Talavia.
The management assessed that carrying values of financial assets i.e., cash and cash equivalents, Investments, loans, trade
receivables, other financial assets and liabilities as at March 31, 2025 and as at March 31, 2024 are reasonable approximations
of their fair values largely due to the short-term maturities of these instruments.
The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a
current transaction between willing parties, other than in a forced or liquidation sale.
B. Fair value measurements
The fair value of the Financial Assets and Liabilities is included at the amount at which the instrument could be exchanged
in a current transaction between willing parties, other than in a forced or liquidation sale. The Company uses the following
hierarchy for determining and/or disclosing the fair value of Financial Instruments by valuation techniques:
(i) Level 1: quoted prices (unadjusted) in active markets for identical Assets or Liabilities.
(ii) Level 2: inputs other than quoted prices included within Level 1 that are observable for the Assets or Liabilities, either
directly (i.e., as prices) or indirectly (i.e., derived from prices).
(iii) Level 3: inputs for the Assets or Liabilities that are not based on observable market data (unobservable inputs).
39. THE CODE ON SOCIAL SECURITY 2020
The Code on Social Security, 2020 ('Code') relating to
employee benefits during employment and post employment
benefits received Presidential assent in September 2020.
The Code has been published in the Gazette of India.
However, the date on which the Code will come into effect
has not been notified and the final rules/interpretation have
not yet been issued. The Company will assess the impact
of the Code when it comes into effect and will record any
related impact in the period the Code becomes effective.
40. OTHER STATUTORY INFORMATION:
(i) The Company does not have any Benami property,
where any proceeding has been initiated or pending
against the Company for holding any Benami property
under the Benami Transactions (Prohibition) Act, 1988
and rules made thereunder.
(ii) The Company does not have any transactions with
companies struck off under section 248 of the
Companies Act, 2013 or section 560 of Companies
Act, 1956.
(iii) The Company does not have any charges or satisfaction
which is yet to be registered with ROC beyond the
statutory period.
(iv) The Company has not traded or invested in Crypto
currency or Virtual Currency during the financial year.
(v) Utilisation of Borrowed funds and share premium:
(i) 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.
(ii) 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.
(vi) 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).
(vii) The Company has not been declared a Wilful Defaulters
by any bank or financial institution or consortium
thereof in accordance with the guidelines on wilful
defaulters issued by the RBI.
(viii) There is no immovable property whose title deed is not
held in the name of the Company.
(ix) The Company has complied with the number of layers
prescribed under clause (87) of section 2 of the Act
read with the Companies (Restriction on number of
Layers) Rules, 2017.
(x) The Company has not entered into any scheme of
arrangement in terms of sections 230 to 237 of the
Companies Act, 2013.
(xi) The Company has availed loans from banks on the
basis of security of current assets. The Company files
statement of current assets with the bank on periodical
basis. Reconciliation of quarterly returns or statements
of current assets filed with banks or financial institutions:
2) Trade Receivables:
a) Reversal of interest income on overdue trade receivables,
b) Loss allowance made for trade receivables,
c) Adjustments to trade receivables due to period-end cut-off procedures,
d) Remeasurement of balances due to foreign exchange rate fluctuations,
e) Recognition of discounts and rebates applied to revenue within trade receivables.
3) Advances to Suppliers and Advances from Customers:
a) Offsetting of these advances against trade payables and trade receivables.
4) Trade Payables:
a) Only inclusion of payables related to raw material and packing material vendor balances.
41. The Company has used an accounting software for maintaining its books of account, which has a feature of recording
the audit trail (edit log) facility, except that audit trail feature was not enabled throughout the year for certain relevant
transactions/fields/tables within the software at the application level. Further, for audit trail at database level, SOC
report with adequate coverage is not available with the Company.
Further, except for above, audit trail feature has operated throughout the year for all relevant transactions recorded
in the accounting software. Also, there are no instances of audit trail feature being tampered with except for above.
Additionally, the audit trail of previous year has been preserved by the Company as per the statutory requirements for
record retention to the extent it was enabled and recorded in previous year.
42. In the financial year 2022-23, the Company had completed initial public offer (IPO) of 10,596,924 equity shares of
face value of ' 10 each at an issue price of ' 237/- per share, comprising fresh issue of 9,113,924 shares (including
55,000 shares issued to employees at concessional rate of ' 227/- per share) and offer for sale of 1,483,000 shares
by selling shareholders. Pursuant to the IPO, the equity shares of the Company were listed on National Stock Exchange
of India limited (NSE) and BSE Limited (BSE) on December 8, 2022.
The Company had received an amount of ' 2,014.39 millions (net off IPO expenses of ' 145.06 millions) from proceeds
out of fresh issue of equity shares.
43. During the previous year ended March 31, 2024, the Board of Directors in their meeting held on November 03, 2023
considered and approved the Employee Stock Option Scheme, viz., Dharmaj Employees Stock Option Plan 2023
('Scheme'), in terms of the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021. The maximum
number of options that may be issued pursuant to this scheme is 300,000 Share options, to be convertible into equal
number of Equity shares of the Company. This Scheme was approved by the members through Postal Ballot with the
facility of E-voting by December 05, 2023. As on March 31, 2025, no stock options were granted to eligible employees.
44. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by
Company.
45. Standards issued but not effective: As at the date of issue of financial statements, there are no new standards or
amendments which have been notified by the MCA but not yet adopted by the Company. Hence, the disclosure is not
applicable.
46. EVENTS AFTER THE REPORTING PERIOD
The Company evaluates all events and transactions occurring subsequent to the balance sheet date but before the
approval of the financial statements to assess whether they require recognition or disclosure in the financial statements.
On January 07, 2025, the Company received an intimation from the GST Department regarding the initiation of a GST
audit covering the period from April 2018 to March 2024. During the course of the audit, the Department raised several
objections, including issues related to the incorrect classification of products, ineligible availment of Input Tax Credit
(ITC), and other compliance matters. Although a formal Show Cause Notice quantifying the demand has not yet been
issued, the Company received the final audit order, based on which it admitted a liability of ' 4.59 millions. This amount
was paid on April 25, 2025. As the conditions giving rise to this liability existed as of the balance sheet date and the
obligation was confirmed prior to the approval of the financial statements, this constitutes an adjusting event under
Ind AS 10. Accordingly, the financial impact has been recognized in the financial statements for the year ended March
31, 2025.
As per our report of even date
For M S K A & Associates For and on behalf of the Board of Directors
Chartered Accountants Dharmaj Crop Guard Limited
ICAI Firm Registration No: 105047W CIN: L24100GJ2015PLC081941
Samip Shah Rameshbhai Talavia Jamankumar Talavia
Partner Chairman & Managing Director Whole Time Director
Membership No: 128531 DIN: 01619743 DIN: 01525356
Vishal Domadia Vikas Agarwal
Chief Executive Officer Chief Financial Officer
Malvika Kapasi
Place: Ahmedabad Place: Ahmedabad Company Secretary
Dated: May 30, 2025 Dated: May 30, 2025 Membership No: A52602
|