2.07 In the earlier years, the Directorate of Enforcement (ED) by way of two attachment orders had provisionally attached certain properties, plant and machinery at Dagori and Siltara for H 30758.39 Lakhs for alleged misuse of coal of Gare Palma IV/4 coal block in the state of Chhattisgarh. The Adjudicating Authority had confirmed the above provisional attachments. Subsequently, the PMLA Appellate Tribunal (AT) stayed both the attachments on an appeal filed by the Company.
The Court of Special Judge, New Delhi (CBI Court), vide its order dated 19th March, 2024, had discharged the Company, Mr Arvind Jayaswal and Mr Ramesh Jayaswal U/S 3 and 4 of the Prevention of Money Laundering Act 2002 (PMLA), holding that there was no offence of money laundering in the absence of any charge of cheating in securing the allocation of coal block. The Company had also filed a separate application for release of the attached properties before the CBI Court. The AT by its order dated 28th November, 2024 allowed the Company's appeals and set aside the Provisional Attachment orders under Section 8(6) & (7) of the Prevention of Money Laundering Act, 2002 (PMLA). However, there is some ambiguity in the said order as it mentions both the appeal numbers, however the body of the Order inadvertently only refers to the OC no.790/2017, which pertains to the first provisional attachment of H 20616.39 Lakhs of the Plant and Machinery under installation at Dagori Integrated Steel Plant situated at Bilha, Bilaspur (Chhattisgarh). Though the operative portion of the order do state that "The appeals are allowed". The ED had challenged the CBI Court order, dated 19th March, 2024 referred above, in the Honorable Supreme Court (SC) by filing a Special Leave Petition (SLP). While hearing the ED SLP, the SC had given oral directions to the Company not to press the application filed with CBI Court for release of the attached properties. Consequently, the Company gave an oral undertaking that it would not press for its early adjudication.
2.08 I n the earlier years, after completion of investigation the Central Bureau of Investigation (CBI) had filed Charge-Sheet pursuant to its FIR against the Company and Mr. Ramesh Jayaswal, the Managing Director (MD) and others alleging misrepresentation and violation of the terms and conditions of the Gare IV/4 Coal Block Allotment Letter and the executed Mining Lease.
The Special CBI Court, New Delhi, then took cognizance of the matter and had charged the Company and its MD under section 120-B r/w Sec 420 and 406 of the Indian Penal Code. The case is under trial. The Company strongly refutes all the allegations and believes it has a good case on merits and is confident that it and its MD would be able to defend themselves.
2.09 During the year, the Company has undertook Category one Capital Repairs and Upgradation of its the Blast Furnace (BF) at the Steel Plant Division, Raipur, therefore the Blast furnace and its associated Power Plants, Sinter Plants, Steel Melting Shops and Rolling Mills remained under shutdown for a period of 84 days. Subsequent to repairs and upgradation, the plant has been fully stabilized and operating at its full capacity.
2.10 During the year, active development of project of DRI and Captive Power Plant at Bilha Bilaspur, Chhattisgarh (Bilha Project) remained suspended and accordingly the Company has not capitalised Borrowing Costs as per Ind AS - 23.
2.11 CWIP includes Bilha Bilaspur project amounting to H 48262.87 Lakhs (Previous Year H 47969.11 Lakhs) had been put under abeyance on account of cancellation of the captive coal mines of the Company by the Honourable Supreme Court of India. The Company had recognised an impairment provision of H 43963.87 Lakhs (Previous Year H 43670.11 Lakhs) for the same in accordance with the Indian Accounting Standards (Ind AS) 36 - 'Impairment of Assets' and the Project remained suspended during the year.
2.12 "In accordance with the Indian Accounting Standard (Ind AS 36) on " Impairment of Assets", during the year, the management carried out an exercise of identifying the assets that may have been impaired in accordance with the said Ind AS. On the basis of a review carried out by the management, there was no further impairment loss on property, plant and equipment and Capital Work in Progress during the year ended 31st March, 2025.
2.13 There are no projects under capital work in progress (CWIP) whose completion is overdue except as stated above in Note no. 2.10 and 2.11.
(b) The Company does not have any intangible assets under development, whose completion is overdue or has exceeded its cost compared to its original plan except as mentioned in Note No.3.03.
3.03 The Intangible Assets under Development include H 1520.75 Lakhs towards Metabodeli Mines (50 Hectares), H 46.88 Lakhs towards Ramdongri Mines and H 27.40 Lakhs towards Sonadehi Mines. In the case of Metabodeli Mines, the Company had challenged the validity of section 10 A (2) (c) of the MMDR Amendment Act, 2015 and Rule 8 (4) of the MCR 2016 before the Hon'ble Chhattisgarh High Court (HC) which passed an interim order dated 12th January, 2017, keeping the application of the company alive. In the case of Ramdongri Mines, the State Government of Maharashtra had granted Mining Lease in favor of the Company on 17th August, 2004. The company has perused the matter with the Government authorities for completion of procedural formalities for Mining Lease execution.
The Company had also challenged the 2021 Amendment to the MMDR Act, 1957, before the HC, vide Writ Petition No. 3696 of 2021 which includes cases of Sonadehi, Devpura and Metabodeli Mines. The HC granted Status-Quo on 6th October 2021.
Further due to Central Government's clarification to the State Government as regards the eligibility of the Prospecting license holder for the grant of Mining Lease, the Company opines that its case with respect to the Metabodeli Mines also falls under Section 10 A (2) (b) in addition to 10 A (2) (c) of the MMDR Act, 1957, as advised by the State Government previously.
Accordingly, the company filed Writ Petition No. 2757 of 2020, before the HC, to ensure that the Mining Lease is granted under Section 10 A (2) (b) upon completion of the stipulated conditions. Presently the matter is pending for consideration before the HC.
The Company opines that as the above cases are already pending under Section 10A (2) (c) and are subjudice, hence the amendments in Section 10A (2) (b) will not have any impact on the status of the case.
Further the amendment under the Mining Act in the second Proviso of Section 10A (2) (b) provides that "the holder of a reconnaissance permit or prospecting license whose rights lapsed under the first proviso, shall be reimbursed the expenditure incurred towards reconnaissance or prospecting operations in such a manner as may be prescribed by the Central Government"; accordingly, the Company does not envisage any losses on account of the above amendment.
3.04 The Company had filed Mining Lease applications for Rowghat Iron Ore Deposit, Bastar, Chhattisgarh. The Chhattisgarh State Government (SG) had rejected the same by a common order which was challenged by the Company. The SG had filed a complaint before the Ministry of Mines which had referred the matter to the Chief Vigilance Officer (CVO), which couldn't make out any case against the Company. The revision petition of the Company was allowed by the Mines Tribunal and subsequently the Hon'ble Delhi High Court also confirmed the order of the Mines Tribunal. The Hon'ble Delhi High Court had specifically observed that the Company had successfully undertaken prospecting operations in the area.
Subsequently in 2012, SG filed a fresh complaint containing the same allegations before the Chief Vigilance Commission (CVC). The Central Bureau of Investigation (CBI) on the directions of the CVC had registered a FIR and then filed Chargesheet against the Company alleging certain irregularities before the Special CBI Court Nagpur where the trial is under progress. The Company doesn't expect any financial effect of the above matter under litigation.
16.04 Rights of Equity Shareholders
The Company has only one class of equity shares having a face value of H 10/- per share. Each shareholder is eligible for one vote per share held. In the event of liquidation of the Company, the equity shareholders will be entitled to receive any of remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.
16.05 There are no shares reserved for issue under options and contracts / commitments.
16.06 Dividend Paid and Proposed of H Nil (Previous Year : H Nil)
NATURE AND PURPOSE OF RESERVES Capital Reserve
The Capital Reserve was created pursuant to the Scheme of Merger of the Steel Division of Corporate Ispat Alloys Limited, Amalgamation of Nagpur Alloy Casting Limited and Capital incentive received from Government of Maharashtra. It shall be utilised in accordance with the provisions of the Companies Act, 2013.
Securities Premium
Securities Premium was created when shares were issued at premium. It shall be utilised in accordance with the provisions of the Companies Act, 2013.
General Reserve
The General Reserve was created pursuant to the Scheme of, Amalgamation of Inertia Iron and Steel Industries Private Limited, Merger of Sponge Iron Plant and Power Plant of Corporate Ispat Alloys Limited and Abhijeet Infrastructure Limited. It shall be utilised in accordance with the provisions of the Companies Act, 2013.
Capital Redemption Reserve
Capital Redemption Reserve was created on account of redemption of Preference Shares. It shall be utilised in accordance with the provisions of the Companies Act, 2013.
Retained Earnings
Retained Earnings represent the accumulated profits/losses made by the Company over the years.
Revaluation Reserve
Revaluation Reserve was created on account of revaluation of Factory Building and Shed. It shall be utilised in accordance with the provisions of the Companies Act, 2013.
Other Comprehensive Income
Other Comprehensive Income (OCI) represents the amount recognised in Other Equity consequent to remeasurement of Defined Benefit Plan.
Equity Component of Compound Financial Instruments
The Company had received the Interest free Inter Corporate Deposits from the Promoters and under Ind AS the difference between the Fair Value and Transaction Value is recognised as Equity Component of Compound Financial Instruments under Other Equity.
c. a first and exclusive charge by way of hypothecation on all the movable assets including Current Assets of the Company, both present and future (excluding the ED Attached Assets).
18.05 The Company was entitled to defer its liability to pay Sales Tax (including a portion of Purchase Tax) in respect of its certain units. The liability under the Schemes as on 31st March, 2025 is H 7863.02 lakhs (Previous Year : H 7863.02 lakhs) which is provided for on the basis of its Net Present Value (Net of payments) of H 1709.98 lakhs (Previous Year : H 2780.01 lakhs). This Sales-tax liability is repayable in five equal annual installments starting at the end of the tenth year from the year to which it relates and will be fully paid up by 30th April, 2028.
18.06 During the previous year, the Company had issued and allotted total no. 28,08,766 zero coupon, unlisted, unsecured, redeemable, Non-Convertible Debentures of H 100 each to Maa Usha Urja Private Limited (MUUPL) aggregating to H 2808.76 Lakhs, on private placement basis, by conversion of the payable amount by the Company to MUUPL and has to be repaid on 09th February, 2032 (subject to availability of call/put options). The Fair Value of NCDs as on 31st March 2025 has been calculated with Discounting rate of 17.50% p.a.
18.01 During the previous year, on 14th December, 2023, the Company allotted 320000 Unlisted, Secured, Redeemable, NonConvertible Debentures (NCDs) with 14.50% per annum as Scheduled Coupon Rate and 3.00% per annum as Additional Coupon Rate, having face value of H100000/- each aggregating to H 320000 Lakhs on private placement basis with a tenor of sixty months from the date of allotment to the various Debenture holders. Vistra ITCL (India) Limited is the Debenture Trustee. During the previous year, the Company has utilised majority of the proceeds of NCDs for repayment of secured obligations of the ACRE Trusts and other related expenditure and the balance proceeds have been utilised fully for the intended purpose during the year.
18.02 The Secured NCDs referred to above and the Current Maturities of NCDs referred in Note no. 24 below, aggregating to H 272079.16 Lakhs are guaranteed by an unconditional and irrevocable personal guarantee provided by Mr. Arvind Jayaswal and Mr. Ramesh Jayaswal. Further they have been secured by first and exclusive pledge of the entire Equity Shares of the Company held by the Promoters and Promoter Group Companies.
18.03 The Secured NCDs referred to above and the Current Maturities of NCDs referred in Note no. 24 below, aggregating to H272079.16 Lakhs are further secured by way of:
a. a first and exclusive equitable mortgage on all the immovable properties of the Company, both present and future (excluding the Enforcement Directorate (ED) Attached Assets and the Corporate Ispat Alloys Limited (CIAL) Steel Division Land acquired under merger).
b. a first and exclusive equitable mortgage on the Land of Neco Ceramics Limited.
29.01 During the year 2005, the Government of Chhattisgarh (CG) published the Chhattisgarh Upkar (Sansodhan) Adhiniyam, 2004, according to which the Company is liable to pay energy development cess @10 paise per unit generated from its captive power plants. The levy of energy development cess has been disputed by the Company and is pending before the Hon'ble Supreme Court of India (SC).
The Office of the Chief Electrical Inspector, CG had sent demands for the energy development cess since the SC vide its interim order dated 2nd November 2007 permitted the department to raise the bill, however it directed that no coercive steps shall be taken by the CG to recover the dues till further orders.
The legislative competence of the CG is not under challenge. The Company had been legally advised in the past that it is highly unlikely that the provision by which the CG has imposed energy development cess will be struck down by the SC. In view of the above and as a matter of prudence, the Company has made a provision of energy development cess aggregating to H 6730.90 Lakhs till 31st March 2025.
Details of Asset-Liability Matching Strategy:-
Gratuity Benefits liabilities of the company are Funded. There are no minimum funding requirements for a Gratuity Benefits plan in India and there is no compulsion on the part of the Company to fully or partially pre-fund the liabilities under the Plan. The trustees of the plan have outsourced the investment management of the fund to an insurance company. The insurance company in turn manages these funds as per the mandate provided to them by the trustees and the asset allocation which is within the permissible limits prescribed in the insurance regulations. Due to the restrictions in the type of investments that can be held by the fund, it may not be possible to explicitly follow an asset-liability matching strategy to manage risk actively in a conventional fund.
B Management is of the view that above litigations will not impact significantly the financial position of the Company.
C The Company has received Show Cause notices from the Excise and Goods and Service Tax (GST) department which mainly
relates to demand of duty for sale of exempted goods, denial of credit on structural steel used in new plants, bank expenses, Demand on CAMPA fund and Royalty and excess ITC claimed then appeared in GSTR-2A etc. The Company does not foresee any losses on this account.
D "In the earlier years, the Company has received various demand notices from sales tax authorities for non-submission of declaration in "C-Form" and also due to absence of tax exemption eligibility certificate related to sales of pellets and as on 31st March, 2024, such demand notices aggregating to H 1375.01 lakhs were disclosed under other contingent liabilities as Disputed Sales Tax and GST.
However, during the year,
a) The Honorable High Court of Chhattisgarh, vide its order dated 11.03.2025, allowed the Company's appeal against the sales tax demand notice of H 13.55 Lakhs for the year 2008-09 for applicability of notification dated 31.10.2006 and accordingly, the Company is entitled for the benefit of exemption without submission of C-Form; and
b) The Honorable Commercial Tax Tribunal of Chhattisgarh, vide its order dated 13.05.2024, allowed the Company's appeal against the sales tax demand notice of H 140.77 Lakhs for the year 2017 -18 on account of receipts of tax exemption eligibility certificate on sale of pellets.
The Company is of the view that since the sales tax demand notices were also issued under the same section and having same allegation, so all such demand notices will also be dropped and hence the Company has not considered those demand notices as contingent liabilities as on 31st March, 2025.
B. Segment Identification, Reportable Segments and definition of each segment :
i. Reportable Segments :
The Company's operating segments are established on the basis of those components that are evaluated regularly by the
Chief Operating Decision Maker, in deciding how to allocate resources and in assessing performance. These have been
identified and reported taking into account the differing risks and returns, nature of products, the organisational structure
and the internal reporting system of the Company.
ii. Primary / Secondary Segment Reporting Format :
a) The risk-return profile of the Company's business is determined predominantly by the nature of its products. Accordingly, the business segments constitute the Primary Segments for disclosure of segment information.
b) Since all the operations of the Company are predominantly conducted within India, there are no separate reportable geographical segments.
c) No Non-Current Assets of the Company is located outside India as on 31st March, 2025 and 31st March 2024.
d) No single customer has accounted for more than 10% of the Company revenue for the year ended 31st March, 2025 and 31st March 2024.
iii. Segment Composition :
a) Steel Segment is engaged in manufacture and sale of Pellets, Pig Iron, Sponge Iron, Billets, Rolled Products and includes its captive power plants at its units located at Siltara, Raipur and Mining activities in the state of Chhattisgarh and Maharashtra.
b) Iron and Steel Castings Segment comprises of manufacture and sale of Construction, Engineering and Automotive Castings with production facilities at Nagpur in Maharashtra and Anjora in Chhattisgarh.
c) Other Segment comprises of trading of PVC pipes.
d) Unallocated comprises of income, expenses, assets and liabilities which can not be directly identified to any of the above segments.
NOTE : 42 EXPENDITURE RELATED TO CORPORATE SOCIAL RESPONSIBILITY (CSR) AS PER SECTION 135 OF THE COMPANIES ACT, 2013 READ WITH SCHEDULE VII.
a. CSR amount required to be spent as per Section 135 of the Companies Act, 2013 read with Schedule VII thereof by the Company during the year is H 1631.66 Lakhs (Previous Year : H 1070.71 Lakhs)
b. i) Expenditure incurred related to Corporate Social Responsibility is H 1715.26 lakhs (Previous Year : H 945.96 lakhs).
ii) Expenditure carried forward to the Financial Year 2025-26 is H 117.70 lakhs (Previous Year : H 34.10 lakhs).
c. The amount of Shortfall at the end of the year out of the amount required to be spent by the company during the FY 2024-25 : Nil FY 2023-24: Nil
d. Total amount of Previous years shortfall: Nil
e. Reason for shortfall: Not Applicable
44.02 Fair Valuation techniques used to determine Fair Value
The Company maintains procedures to value its 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:
i) Fair Value of Cash and Cash Equivalents, Other Bank Balances, Trade Receivable, Trade Payables, Current Loans, Current Borrowings, Deposits and other Current Financial Assets and Liabilities are approximate at their carrying amounts largely due to the short-term maturities of these instruments.
ii) The Fair Values of Non-Interest bearing Non-current Borrowings is calculated based on discounted cash flows using a lending rate. They are classified as level 2 fair values in the fair value hierarchy due to the inclusion of observable inputs.
iii) Fair values of Investment in equity are derived from quoted market prices in active markets.
iv) The Fair Value of the remaining financial instruments is determined using discounted cash flow analysis.
v) 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.
44.03 Fair Value Hierarchy
The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation
techniques:-
i) Level 1:- Quoted prices / published Net Assets Value (unadjusted) in active markets for identical assets or liabilities. It includes fair value of financial instruments traded in active markets and are based on quoted market prices at the Balance Sheet date and financial instruments like mutual funds for which Net Assets Value is published by mutual fund operators at the Balance Sheet date.
ii) Level 2:- Inputs, other than quoted prices included within level 1, that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices). It includes fair value of the financial instruments that are not traded in an active market (for example, over-the-counter derivatives) is determined by using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on the Company specific estimates. If all significant inputs required to fair value an instrument are observable then instrument is included in level 2.
iii) Level 3:- Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs). If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.
NOTE : 45 Financial Risk Management - Objective and Policies
The Company is exposed to Market Risk, Credit Risk, Liquidity Risk and Competition Risk.
The Risk management is carried out by the company under the policy and plan as approved by the Board of Directors. The Risk management plan defines how risks associated with the Company will be identified, analysed and managed. It outlines how risk management activities will be performed, recorded, and monitored by the Company. The basic objective of risk management plan is to implement an integrated risk management approach to ensure that all significant areas of risks are identified, understood and effectively managed, to promote a shared vision of risk management and encourage discussions on risks at all levels of the organization to provide a clear understanding of risk and benefit trade-offs, to deploy appropriate risk management methodologies and tools for use in identifying, assessing, managing and reporting on risks, and to determine the appropriate balance between cost and control of risk and deploy appropriate resources to manage and optimise key risks.The activities are developed to provide feedback to the management and other interested parties (e.g. Audit committee, Board etc.) by way of Action taken report. The results of these activities ensure that risk management plan is effective in the long term.
45.01 Market Risk and Sensitivity:
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate due to changes in market prices. Market risk comprises three types of risks: Foreign Currency Rate risk, Interest Rate risk and other Price risks, such as Commodity price risk. Financial instruments affected by market risk include Loans and Borrowings, Deposits and Investments.
The sensitivity analysis relates to the position as at 31st March 2025 and 31st March 2024.
The sensitivity analysis excludes the impact of movements in market variables on the carrying value of post-employment benefit obligations, provisions and on the non-financial assets and liabilities. The sensitivity of the relevant Statement of Profit and Loss item is the effect of the assumed changes in the respective market risks. This is based on the financial assets and financial liabilities held as at 31st March, 2025 and 31st March, 2024.
(a) Foreign Currency Exchange Risk and Sensitivity:
Foreign Currency Exchange risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate due to changes in Foreign Currency Exchange rates. The Company's exposure to the aforesaid risk relates primarily to the Company's operating activities forex business primarily in USD, EURO and has foreign currency trade payables and receivables. Consequently, its exposed to foreign currency exchange risk. The Company regularly reviews and evaluates its exchange rate exposure and follows its established risk management policies and plan.
b) Interest Rate Risk and Sensitivity:
Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate due to changes in market interest rates. The Company is having Non current borrowings in the form of Secured Non-Convertible Debentures (NCDs) which have a fixed rate of interest and hence, there is no associated interest rate risk.
c) Commodity Price Risk:
The Company's revenue is exposed to the market risk of price fluctuations on sale of its iron, steel and castings products. These prices may be influenced by factors such as supply and demand, production costs (including the costs of raw material inputs), global and regional economic conditions, governmental policies and growth. Adverse changes in any of these factors may reduce the revenue earnings.
The Company prices its Iron and Steel products as per the accepted market practices.
The Company primarily purchases its raw materials (other than captively sourced material) in the open market from third parties or from approved suppliers on contract basis and is consequently subject to prices fluctuations on the purchase of non-coking, coking coal and other raw material inputs.
The company's almost entire requirement of the Iron ore and fines (major raw material) is fulfilled from its captive Iron ore mines reducing commodity price risk of raw materials significantly.
The Company aims to sell its products and procure key raw materials at prevailing market prices. Predominantly the selling prices and input raw materials move in the same direction although with a lag effect.
45.02 Credit Risk
Credit risk is the risk that a counter party will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and other financial instruments. The Company periodically reviews and monitors this risk.
a) Trade Receivables:
The Company measures the expected credit loss of trade receivables, which are subject to credit risk, based on historical trend, industry practices, the operating business environment and adjusted for forward looking information. Loss rates are based on actual credit loss experience and past trends.
The Company has used practical expediency by computing the expected credit loss allowance for trade receivables based on provision matrix based on historical credit loss experience and adjusted for forward looking information. The expected credit loss allowance is based on ageing of the days the receivables are due.
Liquidity risk is the risk that the Company may not be able to meet its present and future cash and collateral obligations without incurring unacceptable losses and might encounter difficulty in raising finances to meet commitments associated with financial instruments that are settled by delivering cash or another financial asset. The Company's objective is to, at all times, maintain optimum levels of liquidity to meet its cash and collateral requirements. The Company relies on operating cash flows to meet its fund needs.
With implementation of the debt refinancing in previous year, the cash flow position of the Company, financial leverage levels, liquidity position have improved and have resulted in elimination of the financial stress. The Company has been doing prompt servicing of debt dues as per the contract and has also made Cash Sweep (Excess Payment) amounting to H 44060.76 Lakhs.
b) Financial Instruments and Cash Deposits:
The Company considers factors such as track record, size of the institution, market reputation and service standards to select the banks with which its balances are maintained. The Credit risk from balances with bank and utilization of surplus funds is managed by the Company's finance and treasury department.
The Company does not maintain significant cash in hand. Excess balance of cash other than those required for its day-to-day operations is deposited into the bank.
For other financial instruments, the finance and treasury department assess and manages credit risk based on internal assessment which is performed for each class of financial instrument with different characteristics.
45.04 Competition and Price Risk:
The Company faces competition from the local and foreign competitors. Nevertheless, it believes that it has competitive advantage as it sells high quality value added made to order Alloy Steel products. Further by continuously upgrading its expertise, quality, range of products through constant Research & Development, it strictly adheres to the delivery schedules to meet the Customers' needs. With successful completion of Blast furnace Category One Capital Repair & Upgradation and repairs of associated other plants, the company has achieved cost benefits and hence further augmented its competitive advantage.
For the purpose of the Company's capital management, capital includes issued capital, all other equity reserves and debt. The primary objective of the Company's capital management is to maximise shareholders value. The Company manages its capital structure, makes adjustments in the light of changes in economic environment and the requirements of the financial covenants.
The Company monitors its capital using Gearing ratio, which is Net debt divided by the Total Capital Employed (Equity plus Net Debt). Net debt is non-current and current debts as reduced by cash and cash equivalents and current investments. Equity comprises all components including other comprehensive income.
49.01 Exceptional items for H 61.19 Lakhs during the previous year represent payments related to Lease rentals and interest in pursuance to the orders of the Honourable Delhi High Court and Samadhan (Delhi High Court Mediation & Conciliation Centre) related to the 70 TPD Oxygen Plant towards settlement between M/s Goyal MG Gases Pvt Ltd (GMG) (Lessor) and the Company.
49.02 During the earlier years disputes arose between the Company and M/s Goyal MG Gases Pvt Ltd (GMG) (Lessor) related to 100 TPD Air Separation Plant. The matter was referred to Sole Arbitrator. On 01st June 2023, he passed an Arbitral Award (Award) which was challenged by both the parties before the Hon'ble Delhi High Court (HC).
On 15th January, 2024, the HC granted stay to the effect and operation of the Award with conditions that the Company had to deposit H 900.00 Lakhs with the High Court Registry (Registry) as Fixed deposit (FD) and pay H 900.00 Lakhs directly to GMG, which was complied by the Company.
Further, on the Company's request H 900.00 Lakhs FD was released in favor of GMG. Presently the appeals are pending before the HC, next date for hearing is 10th July 2025.
However, during the previous year, without prejudice and on prudence, the Company had made provision of H 1824.95 Lakhs as Exceptional item.
NOTE:50
During the year, the Special Central Bureau of Investigation (CBI), Court, New Delhi in the matter related to M/s Abhijeet Infrastructure Private Limited (AIPL), a non-group Company, convicted AIPL and also convicted and sentenced the then Directors of AIPL including Mr. Ramesh Jayaswal u/s Section 420, Section 120-B, Section 120-B read with Section 471 and 420 of IPC. On an application made by Mr. Ramesh Jayaswal, the Honourable Court suspended his sentence to enable him to file an appeal in the Delhi High Court (DHC). Accordingly he has filed an appeal in the DHC against the conviction and sentencing orders. The DHC has admitted the appeal and directed continuation of suspension of the sentencing order.
The Company has obtained legal opinions from an eminent Law Firm and Retired Supreme Court Judge, according to which the above order will not have any effect on continuation of Mr. Ramesh Jayaswal as Managing Director of the Company including his future re-appointments under the provisions of Section 167 and 196 of the Companies Act, 2013.
NOTE : 51 Other Statutory Information
51.01 The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
51.02 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 (whether recorded in writing or otherwise)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.
51.03 The Company has not received any fund from any person(s) or entity(s), 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.
51.04 The Company does not have any such transaction which is not recorded in the books of account surrendered or disclosed as income during the year in the tax assessments under the Income-tax act, 1961.
51.05 No proceeding has been initiated or pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.
51.06 The Company is not declared wilful defaulter by any bank or financial institution or other lender.
51.07 There is no charge creation or satisfaction which is yet to be registered with the Registrar of Companies (ROC) beyond the statutory period excepting twenty-two old charges totalling to H15093.00 Lakhs (Previous Year - 15105.00 Lakhs) appearing on the website of the Ministry of Corporate Affairs due to certain factors beyond the control of the Company. The principal reasons for non-satisfaction of the ROC Charge are as under: -
1) Lender no longer exists,
2) Lender merged with other lender, current lender is unable to track the transaction,
51.08 The company does not have any borrowings from banks or financial institutions on the basis of security of current assets.
NOTE : 52 The Management and authorities have the power to amend the Financial Statements in accordance with section 130 and 131 of the Companies Act, 2013.
NOTE : 53 Previous Year's figures have been regrouped / rearranged wherever necessary, to make them comparable with those of current year.
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